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Wednesday, 31 October 1956

Mr HOWSON (Fawkner) .- The purpose of this bill, as was weil shown by the Minister for Labour and National Service (Mr. Harold Holt) in his secondreading speech, is to raise the stevedoring charge from 6d. to ls. 7d. a man-hour, a matter to which reference has been made in detail by the honorable member for East Sydney (Mr. Ward) and the honorable member for Dalley (Mr. O'Connor). The honorable member for Dalley has suggested that this steep increase is too much. I am glad to see that, on this occasion, the Opposition does not propose to vote against this bill, but believes that it should be carried into effect.

From the figures given by the Minister in relation to the various increases that have necessarily been occasioned by the latest awards in this industry, it will be seen that tremendous additional costs have been incurred. The cost of increasing attendance money from 16s. to £1 4s. a day is £368,000 a year. The cost of sick and holiday pay is well over £1,000,000 a year. Taking into account all the reasons for which this increase has been proposed, 1 cannot see how a charge of less than ls. 7d. a man-hour could be justified.

I am glad to see that, as a result of these increased charges, the waterside workers of Australia will have increased amenities. They will have sick and holiday pay and there will be greater amenities on the wharfs. I believe, in short, that this is another step towards the decasualization of the industry which, I am sure, is desired by members on both sides of the House. I stated during the debate on the stevedoring industry legislation, which was before the House last June, and I still believe, that the eventual aim of the Government should be to achieve permanent employment for waterside workers. I believe that we should aim to get back once again to a proper form of employer-employee relationship, in which private companies are responsible for the employment of the people who work for them and that there should not be an intermediate board as there is at present. I am glad to say that we have gone one step further towards attaining this aim. Members of the Opposition have not drawn attention to the interesting fact that the conditions of the waterside workers are now better than those of shipwrights and

Other skilled operatives who work alongside them on the wharfs and in the ships. I am surprised that Opposition members have never paid much attention to the need for special margins for skill for people, such as these shipwrights, who spend many years of apprenticeship in learning a trade. It is interesting that though the waterside workers have benefited from the latest increases, the hardship of the skilled operatives is more apparent than ever. No reference to this has been made by Opposition members, who always tend to think only of the unskilled labourer, not the man who is so very much more vital to the industry.

Mr J R FRASER - Does the honorable member suggest that all wharf labourers are unskilled?

Mr HOWSON - I do not. I am merely suggesting that they are not as skilled as are the shipwrights and others who work alongside them in the industry.

This is an appropriate moment to speak also of the significant improvements that have taken place in the industry since the Stevedoring Industry Bill was introduced in June. We have heard of some of these improvements from the honorable member for East Sydney (Mr. Ward), but he did not, when he was speaking about the press and radio pick-up, refer to the large number of waterside workers who have benefited from the introduction of this service in the many ports in which it has been operating since June. It is well known that many welcome the service and say that it should have been introduced years ago.

The system of transfers is also working very satisfactorily. Yet, when the bill was brought 'down we had a howl from the honorable member for East Sydney to the effect that the new system would be neither acceptable nor workable. In fact, it is bringing a great degree of efficiency to the industry.

Added efficiency has resulted from the use of smaller gangs for beams and hatches. More important than all these, is the effect of the sling load judgment brought down by Mr. Justice Ashburner. The honorable member for East Sydney suggested that the men have to work harder, but His Honour, having investigated the industry in great detail, decided that greater sling loads were possible without increased effort on the part of the men. His Honour suggested that the stevedoring companies were the right people to determine what the sling load should be. They have detailed knowledge of these matters, and since the change there has been no significant increase in the accident rate. Obviously, the sling load judgment is bringing to the industry improved efficiency, which will benefit both employers and employees. 1 agree that we still have a long way to go, but it is good to see the significant improvements that have taken place in the few months that the legislation has been in operation.

To-night, Opposition members have spent a great deal of time in referring to the findings of the Tait committee on the profits ' of stevedorng and shipping companies. 1 shall deal, first, with coastal shipping, and later with overseas interests. The honorable member for East Sydney suggested that coastal shipping and stevedoring profits have been too high. I suggest that, for a number of reasons, they have not been high enough. The honorable member suggested that rebates from stevedoring charges should be included as net profits to the industry, but ignored the fact that these rebates are largely included as part of the proper commission that should be charged by agents and are, therefore, not profits to the industry, but rather moneys that would otherwise have to be raised by a special commission on the part of the shipping agents themselves.

Two paragraphs in the summary of the committee's report ought to be noted. The committee found that, in December, 1947, freight rates were too low to enable either the Australian Shipping Board or the private shipping companies to engage profitably in interstate trade. Again, during the period 1951-52 to 1953-54, most private operators under the Australian Shipping Board made overall profits, but, in 1954-55, private operators suffered substantial losses on the operation of their own vessels, although their charter acitivities were still profitable.

Mr COUTTS (GRIFFITH, QUEENSLAND) - How does the honorable member reach that conclusion?

Mr HOWSON - These figures are taken out of the Tait committee's report. The honorable member may not have had time to read it. He might well consult the honorable member for Dalley (Mr.. O'Connor).

Mr Coutts - Are they the overall figures?

Mr HOWSON - Yes. They are a summary of the committee figures. Again, the honorable member for East Sydney suggested that a reasonable profit for the industry was that earned by liners engaged in the trade between the United Kingdom and South Africa. .He said that a reasonable return on the estimated replacement cost of the vessels was 5 per cent, per annum, but suggested, at the same time, that the profits of the Australian shipping companies were too high. The summarized findings of the Tait committee gives the average profit of the main operators in the interstate trade. In 1953-54, the year of highest profit, the figure was only 3.3 per cent, of the estimated replacement costs of the vessels. In fact, the highest profits since the war have not nearly been up to what even the honorable member for East Sydney calls a reasonable level. How can he say, then, that the shipping and stevedoring companies are earning huge profits? Their profits have given them no confidence in the future. This is shown by the fact that they have not, hitherto, felt justified in providing new ships for operation on the coast, or new machinery for operation in the stevedoring industry. The average life of a ship is calculated to be 25 years, yet the average age of all ships engaged in the Australian coastal trade is more than 25 years, and the figure is rising annually. There have not been sufficient profits in the industry to enable the shipping companies to buy new ships for operation in these waters. I suggest, therefore, that as the result of the new organization of the shipping and waterfront industries, that flowed from the Government's measures, there is at least good reason for shipping companies to have faith in the future and to provide sufficient ships and machinery in order to increase efficiency and productivity.

We come now to the overseas operators. This subject has been covered at length by the honorable member for Dalley (Mr. O'Connor). He referred to the fact that freight rates are agreed upon by negotiation between the Australian Overseas Transport

Association and the Australia-United KingdomContinental Conference. This system originated in 1929 and has therefore operated for nearly twenty years, not only under Liberal governments but also under the Scullin, Curtin, and Chifley Labour governments. Honorable members opposite, when they were in government, found that this system was efficient; at any rate, they did nothing to change it, so they must have thought that the arrangement was the best that could be devised at that time. I cannot understand, therefore, how they can grumble about the profits being made as the result of this arrangement as they took no steps to change it when they were in office. However, while admitting that high profits are being made by the overseas shipping companies, I cannot agree that the only way of solving this problem is that which was suggested by the honorable member for East Sydney when he said, " Let us go into the industry and do the job ourselves ". The answer to that proposition was given in another part of his speech when he spoke about the chartering of ships operating in coastal waters. The only ships that operated at a profit in coastal waters during many of the post-war years were those which were under charter from overseas interests, and it was proved conclusively that overseas ships can be operated more cheaply than we in Australia can operate ships. However much we tried to compete with overseas interests in the shipping trade between Australia and the United Kingdom and the Continent, we could not do so on anything like a profitable basis. There would be absolutely no chance of this, however much money we invested in ships. I submit that that proposition was advanced "by the honorable member for East Sydney without his having given any thought to the manner of putting it into operation. It just is not practicable, because we cannot compete on the same basis with British shipping. Our costs are very much higher than are those of British companies and this was so even under a Labour government. When Labour was operating ships costs were even higher still. Labour could not operate ships as cheaply as it could charter British ships to do the job.

I agree that we need to introduce some competition. 1 am glad to hear that, for once, honorable members opposite like the word " competition "; it is so unusual for them to do so. As an example of the way in, which competition can be brought about, we have seen what happened recently in the East African trade where the Royal Interocean lines have taken over from the Shaw Savill line and vastly increased efficiency on this run has resulted. The South African Government has been able to reach agreement with the United Kingdom shipping lines on a reasonable basis for the estimation of freight rates.

I am informed that delegates from the Australian Overseas Transport Association are now in London, negotiating with overseas shipping interests. Instead of taking the view of the honorable member for East Sydney, I think we should approach this matter from a more practical angle and examine the original agreement made in 1 929 in order to determine whether it should be varied. If the freight rates suggested by the United Kingdom firms are too high, possibly some competition could be introduced by negotiating on a separate basis with shipping companies on the continent. I hope that our delegates at present in London will get some assistance from the report that has been issued and will endeavour to find a way of negotiating so that competition can once more be brought into the overseas shipping trade. We should look at the matter in a more constructive way than that which was suggested by the honorable member for East Sydney. In one respect it has been a good thing that there have been profits in overseas shipping because at any rate the companies engaged in that trade have been encouraged to invest in new ships to ply between Australia and the United Kingdom. I understand that within two or three years a new liner will come on the run which will reduce from four weeks to three weeks the passage between Melbourne and London. At any rate, as a result of the profits being earned in the trade, we are enjoying a greater measure of efficiency. Let us hope that similar results will be achieved in this country's coastal trade.

We should examine the whole future of this industry. There is no doubt at all in my mind of the vital importance of all the transport industries in the economic life of Australia. The House should remember the warning given by the Minister in his second-reading speech, when he said that members of the Waterside Workers Federation must realize that their whole future is at stake if they persist in raising the costs in this industry and pricing themselves out of the market. We have only to remember what has happened in the coal industry, because of the cost of operations within the industry and increasing competition from oil the demand for coal is falling. Honorable members may have seen a report in the press only two days ago to the effect that James Patrick and Company Proprietary Limited is discontinuing its shipping service between Brisbane and Sydney because of the decreasing need for shipping on that run and the increasing competition being encountered from rail and road interests. This is surely the writing on the wall for the coastal shipping trade, and employers and employees alike must appreciate the tremendous need now for reducing costs in the industry in order to provide efficient service in competition with other forms of transport.

I am glad to see that the Australian Coastal Shipping Agreement Bill which was introduced last June provided a measure of competition in the coastal shipping trade. We have seen the efficiency that evolves with competition in the civil aviation field. Now we have a chance for a similar form of competition between the Australian Shipping Board and the private shipping companies. Both this new venture in coastal shipping and the new future that is evolving in the stevedoring industry as a result of the measures introduced last June provide, 1 feel certain, a feeling of confidence in the future of this industry that those engaged in it cannot have enjoyed over the last twenty years. Let us hope that all engaged in this industry will now strive together as a result of these measures to improve the efficiency of these industries and so help to reduce costs and increase productivity throughout the Commonwealth.

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