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Wednesday, 30 November 1938


Mr GREEN (Kalgoorlie) .- I support the amendment moved by the Leader of the Opposition (Mir. Curtin) because it is entirely consistent with the attitude that was taken by every honorable member on this side of the House when the last flour tax was introduced in this Parliament. The Leader of the Opposition has stated the case fairly fully and has shown the necessity to raise the revenue with which to provide assis- tance for the wheat-growers by some other means than a tax on the bread of the poor. Honorable members who drafted this bill must have foreseen this attack, and I am surprised at the Country party agreeing to the revenue being raised by the method proposed.

There is no doubt about the necessity for assisting the wheat-growing industry. It is long overdue. For the last six years, the Country party has been associated with the Nationalist party, or, as it is sometimes called, the United Australia party, and during that period, in three election campaigns, the Leader of the Country party (Sir Earle Page) and the Leader of the Nationalist party (Mr. Lyons) promised that steps would be taken to stabilize the wheat industry. Yet, nothing has been done until now, when this proposal to tax the 'bread of the poor is brought before the House. As the honorable member for Henty (Sir Henry Gullett) has said, the full effect of it is that, as far as the industrialists and wheat-growers of this country are concerned, because of the improper and unfair means adopted to raise this money, the Labour party is put in the dangerous position of having to fight one portion of the producers in order to see that another portion gets justice. I object to being put in that position. As a man w;ho knows a great deal about the wheat industry, I can say that it is impossible to go through the wheat-growing areas of Western Australia, South Australia and Victoria without seeing that they are nearly on the verge of collapse. For several years now, with the exception of a brief period in rho last two years, the wheat industry has been in a precarious position. In July last year the price for wheat was fair, but that state of affairs existed for a short period only. The fluctuations of price that occur show how necessary it is to stabilize the industry in a proper way. Early last season the wheat was, for. the most part, bought by speculators, and those growers who held on to their wheat in the hope of a rise of price wore finally compelled to sell at unfavorable prices. Wheat-growing is an important industry. I sometimes think that our friends from the cities do not realize how important it is to Aus tralia as a borrowing country that has to pay £27,000,000 per annum overseas in interest. With the exception of the woolgrowing industry, which employs, only a small number of people in comparison, the wheat industry is of more importance to Australia than any other industry. No matter how much we conserve the manufacturing industries of Australia - it is right to do so - they cannot send their goods abroad in order to make up the leeway of revenue necessary to keep Australia solvent abroad that results from reduced wheat prices. It is vital, therefore, that our exporting industries be kept in production. But, unless assistance is given to the wheat-growers, they cannot continue in production for much longer.

Until recently, there were engaged in the wheat industry, 70,000 farmers. Most of the wheat-growers are supposed to own their own land, but, in reality, they do not, because they are heavily involved in debt to the financial institutions. I shall not deal with that aspect for the moment, except to say that to-day there are not more than 60,000 men engaged in the industry. After the partial collapse of the gold-mining in Western Australia and before its recent recovery, apart from the primary industry of timbergetting, the one industry that held the State together was the wheat-growing industry. With only one-fifteenth of the population of Australia, Western Australia produced one-fifth of its wheat, so that State has played an important part in providing funds with which to meet our overseas debts. Whereas formerly there were 12,000 persons engaged in the wheat industry in Western Australia, to-day, because of the low returns, there are only about 7,000. With the price of wheat at something less than 2s. a bushel on the farm - the wheat-growers in Western Australia receive ls. lid. a bushel at railway sidings - even 'with the bounty that is proposed, the wheat-grower to-day will receive 2-Jd. a bushel less than it costs him to grow his wheat. That is an answer to those who are opposed to the granting of governmental assistance to the wheat-growers. Even a discriminatory tax, if no other means wore available, would be justified to give them aid. I put the cost of production of wheat at 3s. 4d. a bushel. As every one knows - the matter has been gone into repeatedly - 3s. 4d. a bushel would be the cost of production in one yeal-, if a farmer had made a clear profit in the previous year; but that figure does not allow anything for interest or for the season when the growers receive nothing, as the result of drought.

Wheat-growing is the most precarious industry in which it is possible for men to engage. If a mau, without knowledge, wished to put money into wheat-growing as an investment, I should advise him that it would be better for him to buy Australian bonds. I do not care what part of the country it be, wheat-growing is a liability on a man, even in parts where the rainfall is assured, such as the western district of Victoria and parts of South Australia. The prices that men have paid for land in the more favored parts of Australia make it impossible for them to grow wheat profitably. I guarantee to any man who grows wheat, and does not also grow sheep, that the return on his investment would be less than it would be if he had bought Australian bonds and spent the rest of his days in his armchair. That can be proved. Wheat-growing is essentially a small man's industry. I maintain that for many years past no farmer has been amassing wealth from the growing of wheat. In Western Australia hundreds of thousands of acres of marginal land have been prepared for wheat-growing over a period of fourteen or fifteen years, by men who started out in a small way under government assistance. Workers were induced by promises made by a former Premier of Western Australia to leave their employment in the mines and go into the outback areas in the hope of making a success of wheatgrowing. They wanted to secure some independence for their wives and families. Many of these men are now broken down in health because of the heartbreaking struggle to eke out an existence. After working from daylight to dark for many years under the- hardest of living conditions, they have finally come to the conclusion that there is no possible hope of ever owning their properties, and have walked out. There are scores of abandoned farms in the marginal wheat areas of Western Australia, which honorable members who do not believe my statement that no man can amass wealth from wheat-growing, can acquire for almost nothing. But if a man has sufficient money to purchase a wheat farm even in good rainfall areas he will find it far more profitable to invest his money in bonds, join a city club, and sit back and enjoy a comfortable life. The Premier of Western Australia, to whom I have referred, was very optimistic about the development of the wheat industry in that State, and he went out into the gold-mining areas and urged miners to forsake their employment underground and take up wheat-farming. At one stage I myself was induced to engage in the wheat industry. The proposition then sounded attractive and hundreds of men left the mines. They took up land with practically no capital. Money was advanced to them by a bank controlled by the Government. One man whom I knew in the early days, took up a holding in the scrub and when I visited him he and his family were living in a tent covered with brush to protect it from the sun. Their meat, the remains of a kangaroo, was hanging in the shade, anr! they were living on this together with bread and treacle. 1 told the man that, there was a job waiting for him with the Australia mine firm in Kalgoorlie on the filter presses at £7 a week. He replied that he would not take the job at £14 n week. That man eventually finished broken in .spirit and body, as hundreds of others have been. I could take honorable members to the mines and introduce them to men who several years ago gave up their futile attempts to make a living in the wheat industry, and returned to their former jobs. To-day they are working under the bad conditions always associated with gold-mining, 3,000 feet under the earth. With wheat at its present price it is impossible to make a reasonable living in wheat-growing. In the district of New South Wales represented by my colleague, the honorable member for Gwydir (Mr. Scully), the price is from ls. lOd. to ls. lid. a bushel. That is approximately ls. 5d. a bushel below the cost of producing it.

Any scheme which has for its object the rehabilitation of the wheat industry of this country must deal with the question of interest charges and with other financial aspects. There is in existence in Western Australia an organization known as the Wheatgrowers Union, which is supposed to be more democratic than the Country party to which my friends, the honorable member for Swan (Mr. Gregory) and the honorable member for Forrest (Mr. Prowse) owe allegiance. Members of the Wheatgrowers Union are in somewhat the same position as the Country party rebels in Victoria. In the Canberra Times of November 28th, 1938, appears the following report: -

Perth, Saturday.

Claiming that action has been forced on growers by "the indifferent consideration given by the Federal Government" the president of the Australian Wheatgrowers Federation, Mr. T. H. Powell, has forwarded to organizations affiliated with the federation in all States, proposals for an intensive campaign in all States to unseat sitting members opposed to their plans for the rehabilitation of the wheat industry. .

The demands include the fixing of wheat at a permanent price basis of 4s. at the siding; providing for reserves of wheat to be held in the Commonwealth for home requirements for twelve months to guard against adverse seasons, and protect the public from exploitation ; compulsory limitation of production, as practically all export wheat is exported at a loss . . .

I.   stress the fact that with the exception of the last two years during which no wheat has been produced in certain areas of Western Australia owing to drought, practically all export wheat has been exported at a loss. Four shillings a bushel is not such an extravagant price as it might appear to be, because it must be realized that it is in the dry areas of Australia that most of our wheat is produced. I do not refer to the unsuitable lands mentioned by the Minister for Commerce (Sir Earle Page), when he introduced the bill. Most of Victoria's wheat is grown in the Wimmera, Northern Wimmera, and Mallee districts, and it is because of the failure of the crops in these areas that the usual annual production of 39,000,000 bushels from that State, one of the most fertile of the Commonwealth, is this year reduced to 13,000,000 bushels, one-third of that quantity. I reiterate that it is quite impossible for wheat-farmers to carry on under present conditions. The wheat industry means so much to the financial stability of Victoria, although it is the greatest manufacturing State of the Commonwealth, that the losses owing to drought this year have meant a reduction of £800,000 in railway revenue, and also a similar deficit in the finances of the State. There is no industry more important to the welfare of the community than the wheat industry. The railway systems of South Australia and Western Australia and, to a large degree, Victoria, depend almost entirely upon good wheat seasons for their revenue. By giving assistance to the wheat industry, therefore, it does not mean that only a smallportion of the community is being helped. For every £200 or £300 paid to the wheat-growers there is a corresponding railway turnover of thousands of pounds. Every man in the wheat-growing industry knows that. Wheat-growers usually depend upon the railways to bring their farm requirements 50, 150 or 200 miles, and the wheat which they produce is carried over similar distances. When there is a failure of the wheat crop in a State such as Victoria, the railway department cannot abandon a large portion of its service, and effect wholesale dismissals. It must continue to operate at a loss for another twelve months. The only way in which a balanced economy can be obtained is by' rehabilitating the position of the wheat industry. That task isa Commonwealth liability, and the whole burden cannot be placed upon the breadwinners of the community as is proposed by this bill.

It is impossible under the proposed plan to fix the price of bread. In the United States of America and Canada it has been frankly admitted that the problem of rehabilitating rural industries is a federal one, and had it not been for action taken by the Roosevelt Administration and by the Canadian Government wheat-growers in those countries would have left the land.


Mr Blain - What was done in those countries ?







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