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Wednesday, 17 July 1946


Mr McLEOD (Wannon) .- For the first time in the history of the wheat industry in Australia we have, in this bill, a stabilization plan which will cover a reasonable period. Under the Government's proposals the farmers will be assured, for five years at least, of a reasonable guaranteed price for their product. That, has never before been the case. I have listened with interest to the criticisms of the bill by honorable members opposite, particularly those of some eminent lawyers and other professional men; but I have not .been able to decide, from their remarks, where they stand in regard to the stabilization of the industry. It seems to me that they have no policy whatever in that connexion. The Leader of the Opposition (Mr. Menzies) said -

We must seek to give a reasonable measure of stability to the whole of what might be described as the average wheat harvest, whether it" be sold in Australia or abroad. Therefore we must be prepared to protect the wheat-grower in respect of npt only that portion of his crop which is sold here but also a reasonable volume of production for export.

That is a delightfully vague statement which does not commit the right honorable gentleman to anything at all, but I pay this tribute to him: unlike his Australian Country party associates he is at least honest. I agree with those who have said that the wheat industry is being regarded as a kind of political football. It is obvious to me that some honorable gentlemen opposite, realizing that we are on the eve of a general election, wish to protect themselves if the tragedy of the return of an anti-Labour government should. happen. It is for that reason that the Leader of the Opposition did not commit himself. He said in effect, " Let us .pay a reasonable price for a reasonable amount ". The right honorable gentleman at one time appeared to consider 2s. 6d. a 'bushel a generous payment, so I am unable to guess what he might regard as a reasonable payment. The honorable member for Indi (Mr. McEwen) has made a very different proposal, 'but I can see that if the antiLabour parties were returned to power, the Leader of the Opposition, if hebecame Prime Minister, would repudiate the proposals of the honorable member for Indi. I intend to test the sincerity of some honorable gentlemen opposite and, in particular, to expose the duplicity of the honorable member for Indi. The honorable member for Wimmera (Mr. Turnbull) asked us to forget the past. Of course, some honorable gentlemen opposite desire to forget their past, because it is so black. They have a deplorable record in relation to assistance for the farmers. But when this Government assumed office it- immediately set to work to help al] primary producers.


Mr Bowden - Do not .be silly!


Mr McLEOD - The honorable member for Gippsland (Mr. Bowden) once posed as a radical, but now he uses his vote, invariably, to help the banks, the big financial institutions, and vested interests generally. Honorable gentlemen opposite are trying to gull the farmers into believing that they would provide a better stabilization scheme than that- outlined in the bill. No doubt the daily prayer of the honorable member for Indi and politicians like him is, " Please give the wheat-farmers a short memory, and let us publicly forget what we did to them in the past ".

A good many of the remarks that have been made about the wheat farmers by honorable gentlemen opposite in the course of this debate savour of rank hypocrisy. What did the honorable member for Indi do to assist the farmers when he was a member of the previous government? He did nothing. It was only after the Labour Government, came into office that the farmers received substantial help, as, in fact, did all those who were engaged in primary production. The Country party and the party that now calls itself Liberal have an extremely unsavoury record in this connexion, as an examination qf the pages of Hansard would show. When the people saw the error of their ways and returned the Labour party to power in the National Parliament the lot of the primary producers improved immediately. Honorable members opposite said that they would do things, but never did them. The Labour party said it would help the farmers and it has helped them. It will be a disaster for the wheatgrowers if, by any mischance, this Government does not retain office after the elections. I intend to remind honorable members of a certain statement of Mr. G. C. Marshman, a practical wheatgrower. He has stated in a section of thi! press '.hut he met the honorable member for Indi .in the corridor of this House while that honorable gentleman was a member of the Government.


Mr TURNBULL (WIMMERA, VICTORIA) - Is Mr. Marshman on the pay-roll?


Mr McLEOD - He is not on the payroll of the wheat merchants. He is a practical wheat-grower. It will be known to those who are well informed on this subject that the Country party, when it was supporting the previous government, acquiesced in the appointment of seven merchants or their satellites to the Australian Wheat Board.


Mr Bowden - Out of how many members ?


Mr McLEOD -- Out of nine. One of the others was appointed to represent the organized wheatgrowers and the second to represent the unorganized wheat-growers. Subsequently, when the change of government occurred, the outlook of primary producers, particularly the wheat-growers, improved immediately. Mr. Marshman was a member of the deputation of wheat-growers which visited Canberra for the purpose of seeking an increase of the price of wheat by 3d. a hi vh el. but the honorable member for

Indi said that he would not embarrass the Government by asking for the increase at that time. I quote the following statement by Mr. Marshman from the Westralian Wheatgrower : -

Whilst on this visit wo met Mr. McEwen in the corridors of Parliament House and made known to him the purpose of our deputation, and requested his support. The reply we received was - " I refuse to embarrass the Government on such a matter at this time ".

The honorable member for Indi said that he would not embarrass the Government because the, country was at war; but shortly afterwards, when the Labour Government was in office, Japan entered the war. Did the Labour Government* thereupon refuse to do anything more to help primary producers? We know very well that it did not. It provided a better price for wheat and it also introduced substantial subsidies, including a subsidy for superphosphate. The previous government budgeted for a war expenditure of ?100,000,000, but this Government has had to budget for as much as ?350,000,000 under that heading. Yet one of its earliest enactments provided a guaranteed price of 4s. for wheat at sidings. For the first time in their history, the Australian wheatgrowers received cash at sidings for their product.' The Government also had to make provision for the payment of subsidies on superphosphate, as well as on other necessaries such as bags and tractor parts. I continue the quotation from The Westralian Wheatgrower -

Mr.McEwen did not send a reply . .' . ami angrily remarked that he resented such an approach to him and would ignore the circular and the body that sent it. Now he poses as the growers' champion.

Mr. Marshmanwent on to say ;

T find it particularly difficult to reconcile the mon that were and the men that are, and would warn growers to be most cautious about taking action to. destroy a subsistence whilst they go out to chase a shadow. 1 stress what follows. Mr. Marshman has had a good deal of experience of politicians of the calibre of the honorable member for Indi. Referring to that honorable gentleman, he said - in reply to a question ait the Country party conference as to whether there was a limit to the quantity of wheat on which the Federal Country party would guarantee 5s. 2d. a bushel, Mr. McEwen replied : " No Treasury "ould sign a- blank cheque".

That proves that the present opposition to the stabilization scheme proposed by the Government is purely political humbug. It is all very well to say, "Next year we will get a good price". As a primary producer, I have experienced the greatest hardship. After World War I., inflated land values, and the inflated prices of all commodities which the primary producer needs, ruined me. We want the wheat industry to have a stabilized price, not necessarily a high price.


Mr TURNBULL (WIMMERA, VICTORIA) - Then why are the wheat-growers opposing this scheme?


Mr McLEOD - The honorable member for Wimmera knows nothing about the wheat industry. For a long time he has been associated with dealers and agents. How he was returned as the representative of wheat-growers puzzles inn.


Mr TURNBULL (WIMMERA, VICTORIA) - I have been a wheatgrower and have never been a dealer.


Mr McLEOD - The honorable member has been associated with auctioneers and land " sharks ". Such interests naturally do not care for stability, but prefer booms and slumps. That is how they make large incomes. They are fearful lest the farmer may get out of their clutches. This scheme has been' brought down by the Government at the request of organizations of wheat-growers. If the honorable member for Wimmera were a wheat-grower whose future, and that of his sons, depended on what he produced, *would he take all that can be obtained from present-day prices or contribute a portion of it to a fund? Undoubtedly, he would say, "We will build up a fund". The wheat-farmer has sufficient brains to realize that, with the price of wheat at 10s. a bushel, there will be such productive activity in Europe that, by mechanized methods, a large surplus will be produced in the next two years, and the possibility is not remote that not a bushel of wheat will lie wanted from Australia. A glut can be caused as quickly as a surplus. The wheat-growers know that. When there is a glut Australia will be the first country to feel the effects of it. Therefore, the wheat-growers want security for the next five years. The Government is accepting a- risk in this matter. If the price of wheat falls below 5s. 2d. a bushel in the next five years, the Government will have to make good the deficiency. I wonder whether any merchant would take a similar risk. Would firms such as Bungie's, Darlings, and Dreyfus give similar conditions to the farmers? Would the honorable member for Indi guarantee to pay for the wheat grown by the honorable member for Forrest (Mr. Lemmon) on similar terms? This scheme will be reviewed during its currency. The value of it lies in the fact that for five years the wheat-growers will know where they stand. The Government is sympathetic to all ;primary producers, and has given them a far better deal than they received from anti-Labour governments. When honorable members opposite had the opportunity to assist the primary producers, particularly the wheat-growers, they did nothing.' They are making this a political issue. The honorable member for Indi has cited figures supplied by a man who, I understand, has made quite a lot of money out of speculations in wheat. Naturally, that gentleman does not want the industry to be stabilized; Certain interests are opposed to the stabilization of any industry. Had there been a stabilization scheme, based on similar principles, in the years from 1919-20 to 193S-39, what would have been the value of it to the wheat industry? The late Mr. J. E. Maycock, who, during his lifetime, was the secretary of the South Australian Wheat Growers Association, a member of the council of the Australian Wheat Growers Federation, and a member of the Australian Wheat Board, and whose death represented a great loss to the wheat industry, prepared a table which was published in The South Australian Wheat-grower of the 22nd February last. It snowed that the total benefits of a stabilization plan to the farmers, had one been in operation for the twenty years from 1919 to 1939,

 

EXPLANATION OF TABLE.

Column 1 shows the years in which the respective crops were grown.

Column 2 shows the total amount of crop grown, including wheat retained on farms.

Column 3 shows the amount of wheat estimated to be retained on farms to cover seed, feed, &c. The amount is estimated at approximately 20,000,000 bushels, and any odd figures over millions are shown in this column in order to leave even millions" in Column 4.

Column 4 is the amount of wheat actually sold in each year.

Column 5 shows the average open market price f.o.r. in - each season.

Column 0 shows the total amount received by farmers in each season, with all wheat sold ;it the open market price shown in Column 5.

Column 7 is the first column commencing to show what would have been received if the present Wheat Stabilization proposals had been in operation. This column assesses the amount used annually for local flour mid miscellaneous purposes at 37,000,000 bushels, being :i 1,500,000 bushels for local flour and 5,500,000 bushels for feed and miscellaneous purposes. This amount of wheat would always bo sold at 5s. 2d. per bushel.

Column 8 shows the value of the balance of the crop sold for export at open market price when the price exceeded the stabilized floor price of 5s. 2d.

When the open market price was less than the stabilized floor price of 5s. 2d., the price' is taken as 5s. 2d., because this is what the fanner would actually receive miller the Stabilization Plan.

Column !) shows the total amount which would have been received by farmers in each year under stabilization and is the total of Columns 7 and 8.

Column 10 shows the average price per bushel for each season when the value of the crop exceeded 5s. 2d. per bushel.

Column 11 shows the stabilized price, being the amount received by the farmer, namely, fis. 2d. per bushel and 40 per cent, of any excess over 5s. 2d.

Column 12 shows the amount per bushel placed in the stabilization fund each year, being 00 per cent, of any excess over 5s. .2d. per bushel.

Column 13 shows the total amount placed in the stabilization fund each year.

VALUE 01' THE WHEAT B.ETURN TABLE.

The Wheat Table printed on the opposite page i.a not printed to suggest that because farmers would have shown a profit of over £1113.000,000 if the present stabilization plan had been in operation for the entire period between the two Great Wars, they are bound to make the same profit in the next 20 years. It is printed with the express purpose of showing farmers what would have happened, and they must examine it and form their own conclusions as to whether future benefits are likely to be greater or smaller.

Some person will say that the stabilization floor price would have been less than 5s. 2d. for the period, hut in 1919-20 and in 1920-21 the f.o.r. price of wheat, which was based on London parity, was 8s. 10-id. and 8s. 6|d. per bushel, bagged basis, respectively, and farmers were receiving this for every bushel they sold, as there was no Flour Tax legislation in existence.

If is worthy of note that these prices were received under the old Compulsory Pool, and that in 1921-22, the first year of the open market, the price fell to 5s; 5}d. I do not suggest that the open market was the cause of this drop, but it is a point worth remembering.

If wheat were sold to-day under the same conditions as in those years,- viz., London parity with Canadian, the price would be 7s. Did., bagged basis, f.o.b. Australia, and those farmers' friends, who do not farm themselves, would have had a better case for opposing stabilization at 5s. 2d. in 1919 to 1921 Mian they have to-day.

It will be noticed that during the twenty years the highest price is 8s. 10id. There were nine years over 5s., three more over 4s., and sight lower than this. Let the farmer consider after studying the information set out in this paper, if better prices than these are likely to operate in the next twenty years.

Critics will say the plan is not for twenty years. Unfortunately, it is not, but it is for five, maybe for six, and will be continued, and the decision the farmers have to make to-day is whether they will have it or not, and most "f them are going to reply with a very definite " Yes ".

The figures in Columns 2 and 5, which are the basis of the table are supplied by the Government Statistician.

In Column 2 it is estimated that approximately 20,000,000 bushels is retained on farms. This is arrived at by allowing 13,000,00(1 bushels for seed and 7,000,000 bushels retained for feed and other purposes. It is possible that many farmers will consider 20,000,000 too high a figure. If this is so, it would mean that there would be several million bushels more in each year to be sold, and this would increase the benefit of the Stabilization Plan to the farmer and its cost to the Government.

In Column 7, 37,000,000 bushels per annum is allowed for flour and 'miscellaneous purposes, being an allowance of 31,500,000 bushels for local flour and 5,500,000 bushels for miscellaneous purposes. This is probably a fair assessment of the position in the period covered by the table, and the purpose of sotting up the table is to show what would have actually happened in that period.

However, in applying the table to the future, any farmer may make his own estimate of the a mount likely to be sold for feed, which will depend on the encouragement and development or at least on the retention of our market for pig and poultry products.

Twenty-five million bushels is estimated to be used for feed in the current year, but this is only an estimate; it is not a fact.

In the coining 20 years we hope to see this amount exceeded, but many persons have a great fear that it is going to be very difficult to hold our market for pig and poultry products at its present level.

If any farmer considers that more should he allowed for feed in the future, he must increase the amount sold at 5s. 2d. in those years in which the open market price exceeded5s. 2d., thus reducing the return to farmers in those years and reducing the benefit of the Stabilization Plan to farmers and its cost to the Government.

The total result of the table showing the actual facts of the position for 20 years from war to war is as follows: -

 

In selecting a period to test the stabilization proposals, it was desired to take a period which would be fair, and therefore instead of selecting any given number of years, which might have been claimed to either favour or to discount the plan, the whole period from the end of World War No. 1 to the commencement of the World War No. 2 was taken.

It is a strange thing that whenever any proposal is put forward which would benefit farmers, it is always opposed by a number of persons who loudly protest that they desire to protect the farmers.

One person inquired who supplied the funds. If we base our estimate of the future on our experience of the past, our table shows that the Government takes the risk of providing £ 108,000,000 and the farmers £21,927,583.

How any farmers' friend can describe the plan as" an attempt by the Government to deprive the farmer of a portion of the market value of his production," or describe it as " picking the growers' pockets," passes my comprehension.

These statements certainly presume that farmers are lacking in intelligence, and are. therefore an insult.

It has also been said that the Government is not taking any risks. Farmers must form their own conclusions by studying the table relating to the past and forming their own estimates of the future.

Honorable members opposite have never had the desire to stabilizeindustries. Many wheat-growers believe that when this bill has been passed by this House and the Senate, it will become law automatically. I stress that this is only the first step. Although the bill may be passed by the National Parliament, it will not become the law of the land unless complementary legislation is passed by the States. Although the Premiers of the States agreed to this scheme, it will still have to run the gauntlet of the last bastions of vested interests, the great stronghold of reaction, the legislative councils of the various States, the majority of whose members represent those who live on the toil of others and exploit themasses. All the planning of the wheat-growers, and all the efforts of their elected representatives in this National Parliament, will count for naught unless the scheme is approved by the Legislative Council of Victoria. Where do honorable members opposite stand? In those chambers they have confederates through whose instrumentality they can destroy this plan. I challenge them to declare themselves. They must know what they intend to do. I want to make it clear and definite that if the scheme is rejected by a State legislative council, open market conditions will prevail. Why do not honorable members opposite say without equivocation, " We are going to defeat this scheme in the State upper houses "? The wheatgrowers should be alert to this danger. We work under a dual system of government, and the final decision in the matter will rest with those who live on the toil of others. They, of course, will be against it.


Mr Bowden - The honorable gentleman is inviting them to turn it down.


Mr McLEOD - They are the confederates of honorable members opposite, who ought to tell them to put the measure through. I am very sorry that the honorable member for Wimmera, an electorate that has great traditions associated with the wheat-growing industry, should be opposing a plan which is designed to benefit the industry. When he travels about his electorate he will realize that the hard-working wheatgrowers are wholly in favour of stabilization, which they know to be their only hope. They do not want to go back to the old system of the open market, under which according to Mr. Dunstan, 2,000 farmers went off the land. Governments which were supported -by honorable members opposite gave the farmers a debt adjustment scheme, but they never brought in a wheat stabilization plan because that would have been against the interests of the merchants and the great combines. The purpose of this Government is to ensure that all sections of the primary producers shall obtain a fair return for their work. This has already been achieved for the dairy-farmers." Honorable members- opposite favour a return to open marketing. The farmers might prosper under such a system for this year, and. perhaps next, but eventually, when prices fell, they would be worse off than ever. ' We are told that prices would be regulated by the law of supply and demand, but the farmers have already been the victims of that law, and they are now demanding a more stable system. The Labour Government has proved that it can give stability to the industry, and honorable members opposite are jealous of its record. It is wrong for them to say that the Government is robbing the farmers. Under this arrangement, the farmers will get back every penny that they put into the fund, - the money, in the meantime, being invested in interest-bearing securities. I hope that prices will keep up, but, if they fall below a certain figure, the Government, under the plan, will be obliged to subsidize the wheat-growers. Honorable members opposite would destroy the stabilization plan for which the' farmers have fought for years. Those who insist upon receiving 10s. a bushel now for their wheat, with no home-consumption price, will come to the Government, and demand a home consumption price when world parity prices fall. They should realize that they cannot have it both ways. As I have said,, the fate of the scheme does not depend upon what is done in this Parliament, but upon what is done in State parliaments by the reactionary confederates of honorable members opposite.


Mr Bowden - Why not put them out of Parliament? .


Mr McLEOD - The franchise for the legislative councils is such that it is impossible to dislodge the reactionaries. Only those who own property of a certain value are permitted to vote.

When it was proposed that all returned soldiers who had fought for their country should be given a vote the friends of honorable members opposite voted against the proposal. The honorable member for Gippsland (Mr. Bowden) ii a returned soldier, and he talks a great deal about what he will do for the servicemen. My opinion is that he will do for them just about as much as he has done for the wheat-farmers, and that is nothing at all. When they were down, he was ready to dump them. The Labour party is the only one that has. ever honoured the promises made to the farmers and provided stable marketing conditions. I am not surprised that the honorable member did not wish his past to be recalled, but in this instance it was necessary to do so. He and others like him have not altered their outlook. The 'honorable member for Indi is a typical example of a man whose- opinions have undergone no change. In 1940, he was asked by the wheat-growers of the Goulburn Valley to 'support their claim for a minimum price of 2s. 6d. a bushel," but he refused. For the benefit of the honorable member for Wimmera, who has so much to say, I quote the following: -

On the 21st November, 1939, an amendment was moved to guarantee the wheat grower 3s. 6d. a bushel f.o.h. on the wheat acquired in the No. 2 pool. When Labour attempted to have a vote taken to allow Parliament to give a decision on this amendment, all the Country party members voted with the United Australia party members, and prevented Parliament from expressing its views in the matter. The Sydney Morning Herald, commenting on the Country party attitude in this regard, said " Gradually it began to dawn on the party that they were. 'on the spot'. They realized that, they must either support the motion or leave themselves open to the accusation that all their talking for the farmers was mere sham-fighting '. "Members cast round for a way out. They found it by persuading the Government to shelve' the .debate, and breathed a sigh' of relief."

That is the record of the men who now profess to be so generous, but we should compare their present protestations withtheir miserable attitude in the past. As for the amendment moved by the honorable member for Indi, I warn the growers, "Beware of the Greeks when they bring gifts ''. On a previous occasion, the honorable member for Darling

Downs (Mr. Fadden) got into trouble with.the Leader of the Opposition regarding proposals for the stabilization of primary industry, and the Leader of the Opposition had to repudiate what the Leader of the Country party had said. In the. same way, two distinct policies for wheat stabilization are now being advanced by the Opposition, but neither will ever be applied.

On the established facts, the growers should have no difficulty in deciding that they had been betrayed by the anti-Labour parties ; and on the same facts, they should have no difficulty in recognizing that the Labour Government has lifted their industry out of the unfortunate position in which it was placed by previous governments. Our purpose is to safeguard the future of the industry. It is easy to recognize the attempts of honorable members opposite and the interests they represent to undermine the Government's scheme, but I ask the growers to remember the record of those who now profess to be their friends. The growers received a raw deal from anti-Labour governments. There should have been a stabilization plan in operation at the end of the last war, and if there had been there would have been no insolvency amongst the fanners, and no need for debt adjustment. When a previous Labour Government endeavoured to have legislation passed providing for a guaranteed price for wheat, the proposal was defeated by the enemies of the Government in the Senate; . yet to-day, honorable members opposite persist in saying that, the Scullin- Government promised the farmers 4s. for their wheat, but failed to honour its promise. I have no doubt that if the present stabilization proposal is defeated by the confederates in State parliaments of honorable members opposite, we shall be told once more that a Labour government failed to honour its -promises. I congratulate the Minister for Commerce and Agriculture upon the way he has co-operated with the organizations of the wheat-growers. He did not get angry with them, as did the honorable member for Indi when the growers asked for a modest increase of 3d. a bushel. The Minister's door has always been open to the growers, and now an effective stabilization plan has been introduced. I congratulate the Government upon having brought down, for thefirst time in the history of Australia, a stabilization scheme for the benefit of thewheat industry.

Silting suspended from 6 to 8 p.m.







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