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Wednesday, 30 November 1938

Mr GREGORY (Swan) .- I think that the attitude of the Opposition is paradoxical. I should have thought that this bill would evoke compliments to the Minister for Commerce (Sir Earle Page) and the PostmasterGeneral (Mr. Archie Cameron) on the marvellous work that they have done in bringing the whole of the States together in amicable understanding on a difficult problem. The States themselves recognize that they were taking a great responsibility in recommending legislation of this description. Of the six States which are parties to the agreement, three are under the control of Labour governments, while in a fourth, Victoria, the government holds office with the support of the Labour party. It is extraordinary, therefore, that the Leader of the Opposition (Mr. Curtin) should take the step of moving an amendment, the effect of which would be to defer, if not entirely destroy, the bill. If there was anything like freedom of trade between the nations of the world, wheatgrowers of Australia could compete on the world's markets except in times of national emergency, without receiving any assistance from the Government. It was stated in the report of the Agricultural Committee of South Australia that both South Australia and Western Australia could compete with any country of the world, were it not for the greatly increased cost of producing wheat in Australia. That cost has almost doubled during the last fifteen years, and the result is that to-day a great majority of the farmers are bankrupt or are on the verge of bankruptcy. Recently I placed before the House a graph showing the approximate value of a bushel of wheat in other countries of the world including,

Argentina, United States of America, and Canada, compared with Australia. The remarkable fact disclosed by the graph was that the purchasing power of a bushel of wheat in Australia was much lower than in any of the other countries. I had an accountant in Western Australia prepare a table showing the costs of production of wheat in Australia for all years from 1913 to 1931. Over that period the increase was nearly 100 per cent. It is that state of affairs that has done much to make conditions difficult for Australian wheat-farmers. The following is an extract from the report of the Royal Commission on the Wheat, Flour and Bread Industries : -

The (practice of selling wheat for consumption in Australia at approximately the world parity prices for export wheat has been of benefit to the Australian consumer to the extent of approximately1s. per bushel as compared with the prices which would have been paid for wheat imported duty free.

The average price for wheat for the years 1916 to 1931 was over 5s. a bushel, yet the royal commission which thoroughly investigated the industry found that the people of Australia were benefiting to an amount of1s. a bushel on all wheat consumed in Australia. The report further stated - the industry probably provides more direct employment than any other single industry in Australia; the industry provides almost 20 per cent. of the freight earnings of, and approximately the same percentage of the total tonnage of goods carried by the railways of the four principal wheat-producing States; the industry contributes a substantial proportion of Australian credits overseas;

If the wheat-farmers are to be allowed to be forced off their land, an enormous loss must inevitably accrue to Australia, not only through loss of home market for other producers, but also because of damage to credit overseas. I would prefer legislation to guarantee a price for all wheat consumed in Australia, similar to the scheme operating in Canada, because then the person exporting wheat would receive the same advantage as the man who produced for local consumption. The value of our export trade is an important factor. It must also be recognized that a greater population is necessary to this country in order that the agricultural industries may be developed. It is easy to imagine what a setback it is to this country to have wheat placed on its markets at 2s. 2d. or 2s. 3d. a bushel, which is the price obtaining in those States which are so vitally concerned in the industry, although I understand that the figure is a little higher in Victoria and New South Wales. Those engaged in the industry have also to bear the burden of high tariffs which not only increase the cost of production but also bring about a loss of markets, because of the restraint placed on international trade. Ships come to Australia in ballast instead of carrying cargoes for sale in this country. All of these things affect the industry and must be taken into consideration.

The demand for a home-consumption price has been brought about by a persistence of adverse conditions under which farmers find it impossible to carry on. I well remember the agitation which was carried on for some time for the establishment of a compulsory pool. It was believed then "that the only practicable method of providing for such a price in Australia was by means of a voluntary pool. We all know the history of that voluntary pool. With the exception, possibly, of Western Australia, voluntary pools have been a failure. Then came the demand for a compulsory pool. We passed legislation to enable the creation of a compulsory marketing scheme, but owing to the decision of the Privy Council that Commonwealth legislation regulating interstate trade was unconstitutional An effort was then made to secure necessary power for the Commonwealth by means of a referendum, which would have enabled the Commonwealth Government to control the interstate marketing, of wheat. I do not wish to indulge in unnecessary criticism with regard to influences which were brought to bear during the referendum campaign, but there is not the slightest doubt that in a number of States there was the strongest opposition to the Commonwealth proposals, yet in very few instances did we find members of the Labour party urging that the powers of the Commonwealth should be enlarged. There are in the Common- wealth many supporters of complete unification, involving the granting' of greatly increased powers to the Commonwealth; yet when this question which so vitally affects the wheat industry was put to a vote, the referendum was defeated, and it is not within the power of this Parliament to legislate in the direction of establishing the compulsory poll advocated by so many who opposed that referendum. Recently a meeting of the Agricultural Council was held to seek a way out of the difficulty created by the failure to alter the Constitution, and then Ministers representing the various State governments held a conference. I appreciate the difficulties which confronted the Labour governments of the States when an amicable decision with regard to the fixing of a home-consumption price was being sought. These governments were called upon to undertake the introduction of legislation providing for the fixing of prices of wheat products within each State conditional upon the Commonwealth Government passing legislation, which is now before the House, to impose a tax on flour used for the manufacture of bread. For many years the Labour party has professed itself to be in favour of the establishment of a home-consumption price, and has stated that it would be prepared to introduce legislation for this purpose if it were in power. To-day the Leader of the Opposition drew special attention to the fact that the effect of the legislation now before the House would be to increase the cost of living, and he said that definite hardship would be placed upon men with large families. I point out that the effect upon the consumer of the establishment of a homeconsumption price by means of a compulsory pool, as advocated by the Labour party, would be exactly the same. Whether by a compulsory pool or by the means provided for in this legislation, the price of flour will be fixed at a certain amount, and the effect upon consumers of bread will be precisely the same by either method.

It is not only the price of bread that affects the cost of living. One can hardly congratulate the Labour party in this regard because a policy of high tariffs means increased costs in many directions, including building materials, such as timber. As I have previously stated, not only have three Labour governments approved of this legislation, but the legislatures of the States concerned have also accepted full responsibility for it. In view of that it is difficult to understand the attitude of the Labour party in this Parliament. Criticism of this measure was expressed by the honorable member for Henty (Sir Henry Gullett) on the ground that it would increase the price of foodstuffs. It is therefore strange that while that honorable gentleman was a Minister, Cabinet introduced similar legislation to that now before the House.

Mr Lane - Has the honorable gentleman ever been in Cabinet?

Mr GREGORY - I have been in Cabinet for longer than most other honorable members in the chamber. I was a member of Cabinet in "Western Australia for nine years. The honorable member for Henty criticized the principles of this legislation on the ground of what he termed decency and justice, but I submit that his criticism was far from justified, and anything but decent.

Criticism has also been expressed by honorable members of the proposal to set aside £500,000 of the money raised under this legislation for the purpose of alleviating distress in drought-stricken areas. The opinion has been expressed that the industry itself should not be compelled to make some provision to meet such circumstances. I think that is wrong. I agree with the honorable member for Riverina (Mr. Nock) that if less wheat is being produced in Australia 'competition for local consumption is not so keen, and those who benefit in that way could well be expected to aid their fellow producers not so fortunately circumstanced.

This legislation will give to wheatgrowers greater stability. I think that the legislation should be kept in operation for five years or more so that the industry may be placed once more on a sound footing. I do not believe that over-production of wheat throughout the world will occur for long. The position to-day is due to the war scare and to the policy of economic nationalism .adopted by many countries. According to a statement by Sir George Reisch appearing in to-day* press, unless the nations of the world get together and rid themselves of economic barriers of trade in the next year a war will destroy civilization. That is the cause of nearly all the trouble. I venture to say that if, within a few years, the nations of the world can come together and agree to trade together freely, there will be little difficulty in supplying not merely the quantity of wheat the world is producing to-day, but very much more. It is dreadful to think that large masses of people in different countries of the world are starving for the staff of life at a time when there are huge stocks of wheat that nobody seems able to buy. One important feature of this bill which honorable members should not lose sight of, is that if the world price of wheat rises to 6s. the price to the Australian consumer will not exceed 5s. 2d. An excise duty will be imposed upon all wheat exported at a price above 5s. 2d. for the purpose of establishing a fund which is to be utilized to correct any increase of the price of wheat in Australia beyond the level set out in the bill. That phase of the bill should make it acceptable to the people as a whole. If this legislation were to have effect for only one year, as has been suggested, it would only result, as the honorable member for Riverina (Mr. Nock) has said, in the necessity for having the disabilities and difficulties of the wheat industry brought up in this House year after year. That could only result in continuous trouble in regard to this important industry.

I trust that nothing will be done to hinder the passage of this legislation, which will mean so much to the future of an industry which is of such great importance to Australia. Delegates to the Rome conference from nearly every country in the world declared that the prosperity of the farmer is absolutely essential to national prosperity. With the prosperity of the farming community is bound up the success of the secondary industries and those employed in them. I am hopeful that instead of a proposal that there should be a reduction of the production of wheat we shall find necessity for increasing it. Western Australia has a huge area, of wheat land which should be put into use. The greatest difficulties confronting the farmers to-day are brought about by low prices and high costs of production. If production costs could be lowered the people could enjoy rauch better conditions. I hope that as honorable members realize that all of the Australian Governments have expressed a desire that the bill should be placed upon the statute-book, it will meet with the approval of the House.

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