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Thursday, 16 May 1957

Mr IAN ALLAN (Gwydir) .- I find -myself in disagreement with honorable members who have spoken on this bill, because I do not think the scheme will work. There is nothing wrong with the objectives of the bill or with the intentions behind it. Those objectives would be supported by every wheat-grower throughout Australia. They are praiseworthy. Everyone wants to see more research conducted into the problems of the wheat industry, but I do not believe that this scheme will bring that about. I shall give my reasons for saying so.

The proposal is that a tax shall be levied on the wheat industry to raise money for the purposes of new research. It is the word " new " which gives rise to the first difficulty. This is a developing industry. Technical advances in the industry are going on all the time, and there will be great expansion. The specific methods of assisting the industry at the present time are set out in the bill. That work is being done by State government agencies and Commonwealth Government agencies. How are we to determine, either now or in the future, what constitutes a new research project? Surely it is reasonable to expect that the money raised from the wheatgrowers by the tax that will be levied under this scheme will be merged with the rest of the funds available to those agencies. It will make no difference to the amount of research work carried on. The only change will be that the wheat-grower will be carrying a heavier burden. Well, the wheat-grower is accustomed to doing that. For many years he has been subsidizing the consumer of bread by selling his wheat at the home-consumption price. That has cost the wheat industry many millions of pounds. The wheat-grower has also paid out of his income for all the wheat storage facilities and shipping facilities for his crop. This additional burden will not hurt him very much, and he will not object to it if it achieves anything new that is worth while. But I doubt very much whether we can take that aspect of the scheme on trust. I believe that the money raised in this fashion from the wheatgrowers will be pooled with the rest of the funds which the State governments obtain from the Commonwealth Government.

Let me turn to the second point. How much will the Commonwealth Government contribute to this fund? Will it contribute anything? If it will contribute, why does it not say so? Why must we take that completely on trust? Who are we trusting? We may trust this Government, but in the future there will be other governments. Can we trust them to contribute any specific amount? I do not think that we can. We are proposing to disburse this money for a variety of extension works and research works. I think it is unreasonable to expect that the department will allocate a part of the funds that it gets annually to some work that is being carried on in a State, additional to the work that is financed by the normal grants to that State for agricultural research. I think that it would be quite unrealistic to expect that to be done. I suggest that a much better procedure would be for the Commonwealth to nominate specific works and to stipulate the amount of money it is prepared to contribute annually to those works. Then we would know exactly where we were going and what the wheat-grower was paying for.

The third point to which I refer is crucial. Who will pay this tax, anyway? It will not be the wheat-grower this year. It will not be the wheat-grower next year, because the cost of production is now above the export selling price and we are drawing on the stabilization fund. Considerable sums have been drawn out this year. The fund will be exhausted in another year, and no more money will be available from that source. So the fund will pay the tax this year and the Government will pay it next year. This trend in costs and prices has been apparent for a considerable period. There is no reason to believe that it will suddenly turn the other way, just because we have passed this legislation. We must proceed on the assumption that the present trend will continue into the foreseeable future. If it does continue in the way in which it has gone in the last few years - that is, with overseas prices falling and costs at home rising - this tax, in future years, will be paid by the Government.

If that assumption is sound, I suggest to the Minister for Primary Industry (Mr. McMahon) that it would have been better to defer this proposal for discussion during the negotiations that will take place next year when the wheat stabilization scheme comes up for renewal. The scheme expires next year. There may not be a wheat stabilization scheme next year; there may be a subsidization scheme.

I regret that I have to disagree with the Minister on this bill, because I know that his intentions are wholly admirable and praiseworthy, but I hope that the suggestions I have made will be considered by him before the bill goes much further.

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