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Wednesday, 3 June 1942

Mr CHIFLEY (Macquarie) (Treasurer) . - This debate bar illustrated clearly the differencesof opinion that exist even among wheat-growers when they seek to reach an agreement upon the price to be paid for their crop. I apologize for the absence of the Minister for Commerce (Mr. Scully), who, because of illness, is unable to attend ; but, learning, I presume by the kindly intimation of the honorable member for Swan (Mr. Marwick), that the subject was to be discussed, he has prepared the following statement : -

The honorable member for Swan, in his motion, has raised two separate points. First, the payment for the current wheat crop harvested during 1941-42 and placed in No. 5 pool, and, secondly, the completion of payments of the crops from the two previous seasons. I am surprised that there should be any question about payments for the present wheat pool, because the method adopted was specifically recommended by wheatgrowers' representatives, and the Government is carrying it into effect. The wheat stabilization plan is based upon the normal Australian crop of 160,000,000 bushels, of which approximately 140,000,000 bushels is marketed. Before the details of the plan were decided in November, 1940, the former Minister for Commerce (Sir Earle Page), together with officers of the Department of Commerce, met representatives of the Australian Wheat-growers Federation in Sydney. They were Messrs. Kendall, Cullen and Stott, who represented three of the main wheat-growing States and held the principal offices in the federation.

It is well that honorable members should note that.

The possibility of production in excess of the normal harvest was discussed, and it was made clear that, in the event of the crop being above the average, payment would be made on the basis of an adjustment of the fund guaranteed over the whole crop.

Mr Prowse - That is capable of two interpretations.

Mr CHIFLEY - Some honorable members have placed two, and even three, interpretations upon it. The statement proceeds -

Honorable members will realize that crops vary, and, in the case of wheat, vary greatly, so it was clear that sooner or later there would be a crop giving more than 140,000,000 bushels for the market. This immediately raised the question of what should be done in such circumstances. Two solutions are obvious. The first is the method which this Government has adopted and which was accepted by the previous Government, namely, to spread the total guaranteed fund over the whole marketed crop. The second method would be to pay a guaranteed price of 3s.10d. a bushel on 140,000.000 bushels, and the excess crop would then be placed in a separate pool.

If the excess crop were placed in a separate pool, some honorable members would have ground for complaint if the Government attempted to recoup itself by selling in competition with the main pools. The statement continues -

On this basis, wheat-growers would receive the full guarantee on a percentage of their crop. Honorable members may recall that the former Minister did not commit himself on this question in the House; but, in reply to several questions, he stated that the problem would be dealt with when it arose. It did arise very shortly after he left office, and I had to deal with it.

The nearest that he came to committing himself definitely on this matter was on the occasion of his introduction into this House of the wheat industry stabilization legislation on the 29th November, 1940. when he stated -

The liability of the Commonwealth Government is based on an acquired crop of 140,000,000 bushels at a guaranteed price of 3s.10d. per bushel f.o.b. bagged wheat basis.

My interpretation of this statement is that the Commonwealth Government's liability would be limited to approximately £27,000,000 - the total amount of the guarantee. Honorable members will recall that the former Minister had in mind the control of production to a marketable crop of 140,000,000 bushels, by the provision in the regulations for the cutting of crops for hay. However, the matter had been discussed, and, although I am informed that the former Minister for Commerce rather favoured the second method, he asked for the advice of the wheat industry concerning it.

On the 1st and 2nd May, 1941, a conference was held in Melbourne which was attended by members of the Australian Wheat Board, the Wheat Industry Stabilization Board, and the Wheat-growers Advisory Committee. The Wheat-growers Advisory Committee was nominated by the Australian Wheat-growers Federation, and consisted of one member from each of the four big wheat-producing States. The members were Mr. Maycock, of the South Australian Wheat-growers Association; Mr. Marshman, of the Victorian Wheat and Wool Growers Association; Mr. Watson, of the Wheat and Wool Growers Union of Western Australia ; and Mr. Kendall of the Farmers and Settlers Association of New South Wales. Mr. Stott, the secretary of the Australian Wheat-growers Federation, also attended. In addition, Mr. Cullen, of the Victorian Wheat and Wool Growers Association; Mr. Field, of the Farmers and Settlers Association of New South Wales; Mr. Diver, of the Primary Producers Association of Western Australia; and Mr. Clarke, of South Australia, were present, as the four wheat-growers' representatives on the Australian Wheat. Board. Honorable members who are familiar with the wheat industry will realize that these men were competent representatives of the growers.

The meeting discussed the method of payment, in the event of a large crop, and the following resolution was carried unanimously : -

That when the marketable crop exceeds the quantity on which the guaranteed price is payable and the realizations from the sale of that crop do not return to growers a guaranteed price of 3s.10d. per bushel f.o.b. ports, bagged basis, payment of 3s.10d. per bushel on the guaranteed quantity be averaged for the whole marketable crop for the year.

This resolution was passed on the first day, and was confirmed on the second day unanimously.

This rather contradicts some of the statements which honorable members have made to-day, and will be most difficult to answer. The representatives of the wheat-growers assembled at this conference. Presumably they were authorities upon the wheat industry, and represented various wheat-growers' organizations.

Mr Prowse - I still think that another interpretation may be placed upon the resolution.

Mr CHIFLEY - The resolution appears in black and white, for every honorable member to read.

Mr Prowse - The Treasurer will admit that the Government guaranteed a payment for 140,000,000 bushels, and that there was a surplus of 13,000,000 bushels. Could not the meeting, in agreeing to the resolution, have meant that when the 13,000,000 bushels was disposed of, the amount realized, in addition to the subsidy, would be paid to the growers ?

Mr CHIFLEY - To read that into the resolution the honorable member would have to strain his imagination almost to breaking point. The statement continues -

I need only point out that this matter was fully considered by the growers' own representatives before the size of the crop was known, and now that a crop above the average has been received the Government is putting into operation the unanimous recommendation of the wheatgrowers' own representatives. Actually, the present position is the result of a crop which was better than usual in Western Australia and Victoria.

Some honorable members have suggested that the new arrangement was made for the benefit of wheat-growers in New South Wales.

Mr Pollard - But for the pressure exerted by the Labour party on the then government the scheme would not have been so good as it is.

Mr CHIFLEY - No doubt. The Minister's statement continues -

As I have announced before, the result is that, while growers will get the same amount of money for the crop, the guaranteed price will be reduced from 3s.10d. per bushel to approximately 3s. 6d., but in view of the circumstances which I have explained, the Government does not have to apologize for accepting the advice of the people who are most interested in the matter.

The Government makes no apology, because, if it is not to accept the advice of the people associated with the industry, whose advice will it accept - the advice of some one who wants to make a little political capital?

Mr Marwick - That remark is most unfair.

Mr CHIFLEY - What is the truth? Do honorable members who have spoken on this matter speak on behalf of the wheat-growers' organizations ?

Mr Marwick - I have been raising this matter for a month.

Mr CHIFLEY - Yes, but the wheatgrowers of Australia are organized, and I assume that the members of the organizations are elected properly. If they are not, that is the fault of the wheat-growers. Do honorable members claim to speak on behalf of the organizations named in this statement, or are they speaking on behalf of themselves and saying what they believe to be the proper thing to do?

Mr Marwick - Yes.

Mr CHIFLEY - I do not dispute the sincerity of honorable members, but have they the authority to speak on behalf of the official organizations of the wheatgrowers ?

Mr Marwick - No one has claimed that he does.

Mr CHIFLEY - Well, I have made claims myself sometimes which may not have been basically correct. I am sorry that the Minister for Commerce is not here to argue this case; he could do it much better than I can hope to do. But enough has been said to indicate that he had sound reasons for regarding the resolution carried to be a unanimous authorization by the wheat-growers for him to do as he has done. I shall bring to his notice the points that have been raised in this debate. No doubt he will be anxious to read what has been said, and I am sure that he regrets his inability to be here. His statement continues -

The second matter raised by the honorable member concerns the Government's failure to finalize payments to farmers on wheat in No. 2, No. 3 and No. 4 wheat pools. Actually, of course, it is No. 2 and No. 4 wheat pools that are concerned, since No. 3 is only a low-grade wheat from No. 2 pool. It might be pointed out that pools cannot well be finalized until the wheat in them has been sold and payment received for it, and in neither No. 2 nor No. 4 pool has this been done.

The only other pool is the No. 3 pool, which consists entirely of low-grade wheat.

Mr Marwick - To all intents and purposes the wheat in the No. 2 pool has been disposed of, and the Government has the money.

Mr CHIFLEY - The facts are as this statement sets them out. The statement continues -

No. 2 pool was the first war crop, and included in the sales of that wheat was a sale to a country with which we are now at war. War occurred before that country had completed payment, and as a result the Australian Wheat Board has not yet received full payment-

Honorable members may say that there are means of getting that money. The statement continues -

There is still over £300,000 owing and while it is hoped that the money will be paid before long, it cannot be stated definitely just when the money will be received. The other pool mentionedis No. 4 pool which consisted of the very light crop of 1940-41. In this case there is still wheat remaining for sale. Certainly there is not much of it left now, but honorable members will realize that if growers are to get from any wheat pool exactly what they are entitled to, then they cannot get a final payment until all sales in the pool have been completed.

I would point out, however, that it is the policy of the Government to pay advances to growers as soon as they can be justified, and honorable members may be assured that further payments will be made to the growers concerned at the earliest opportunity.

In the case of No. 4 pool this matter has already been considered, and the Government has decided the amount of the next advance. A payment of 3d. a bushel will be made on all wheat in this pool, the total amount being £800,000.

Mr McEwen - That was a quick decision.

Mr CHIFLEY - It was not made within the last few days. The honorable member, as a former Minister, knows that governments sometimes make decisions, but that other people have to be consulted before the decisions can be announced. As the Commonwealth Bank is concerned in the making of payments of this kind, the decision of the Government could not be announced until the banking authorities had been consulted. I am glad that the announcement can be now made. The Government was not forced into making this announcement merely because the adjournment of the House was to be moved to discuss the wheat situation. The Minister's statement continues -

This will bring the amount paid to 3s. 10d. a bushel less freight for bagged wheat. There will be a final payment for this pool to be made later.

I fully appreciate the feelings of wheat-growers when they find that it takes a long while before they receive the final payment for wheat which they have delivered to the Commonwealth, but this delay is inevitable. Growers realize the diffi culty of selling wheat abroad at the present time, and I think that they realize also that the present system of selling Australia's wheat is the only satisfactory one under war conditions. With present markets it takes a long while to sell a wheat crop, and at the end of the present year we shall have most of the 1941-42 crop still on hand. I can only assure honorable members that it will be sold asquickly as possible, that it will be sold on the best terms possible, and that wheat-growers will receive the full market realizations.

Thehonorable member for Wakefield (Mr. Duncan-Hughes) referred, I think, to the possibility of there being a shortage of wheat. I say this for myself, not on behalf of the Minister, that in one State there is sufficient wheat on hand to last that State for twenty years.

Mr Duncan-Hughes - I spoke about the possibility of there being a shortage of primary products generally; I did not specify wheat.

Mr CHIFLEY - Yes ; but the honorable gentleman linked his remarks with a discussion about wheat. I attended one of the wheat conferences, and the picture I saw was that, even if we did not grow any more wheat this year, and if there were no losses of wheat stored, we should have sufficient wheat in stock to last us, on a normal consumption, for three and a half years. I realize, of course, that stored wheat does deteriorate in some parts of the country. In Western Australia, for example, deterioration took place before the grain was taken off the fields. The wheat problem is a hardy perennial in this Parliament. About ten years ago the chances were that whenever one entered this chamber one would hear talk about wheat guarantees and the like. The problems of the wheat-farmers crop up every year in this Parliament. The proper control of the industry has never been the subject of a fullyconsidered plan.

Mr SPEAKER - The honorable gentleman's time has expired.

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