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Thursday, 4 May 1961

Mr POLLARD (Lalor) .- Mr. Deputy Speaker,the measure now before the House for consideration is a very brief bill consisting of a couple of pages of amendments to the Wine Overseas Marketing Act 1929-1954. I remember very well the last amendment which was made to the act in 1954. It was designed to grant additional powers to the Australian Wine Board which controls the export of wines and brandies, to enable it to promote, by advertising and other means, the sale of wines, particularly within Australia. This bill is designed to vest the board with powers that will enable it more effectively to market wine and to promote its sale in the United Kingdom and other countries.

The wine industry is of very great economic importance to Victoria and South Australia in particular, to New South Wales to a lesser degree, and to Western Australia to some degree. The industry is fairly well organized. As far back as 1929 this Parliament enacted legislation empowering the collection of a levy. That legislation has been amended from time to time to permit the collection of increased levies. As far as I know, the work of the Australian Wine Board, generally speaking, has been of a high order. Now, with the substantial expansion of the industry following the last war and the great production available, it is essential that facilities for promoting sales in the United Kingdom should be expanded. This bill provides for that action to be taken.

According to the second-reading speech by the Minister for Primary Industry (Mr. Adermann) the immediate and main purpose of this legislation is to allow the Wine Marketing Board to .acquire property in London and to stock it with wine which it will be empowered, under this bill, to acquire. I take it that this wine will be purchased from the owners. Presumably the objective is solely to promote the sale of wine in the United Kingdom. I cannot see any objection to that, Mr. Deputy Speaker.

It is realized by the wine industry that very large vested interests in the United Kingdom are not very interested in fostering the sale and consumption of Australian wines in that country. I was in the United Kingdom with my friend, the honorable member for Blaxland (Mr. E. James Harrison) some three years ago. Although we are not wine bibbers, we made it our business to make some inquiries about the availability of Australian wine in the provinces of the United Kingdom. On inquiry at hotels and other places at which we stayed overnight, we found that Australian wine was almost entirely unknown. Pursuing our inquiries, we were told by one innkeeper that he considered that one of the main reasons why Australian wine was not more popularly known and more readily available was that the great wholesale and retailing houses of the United Kingdom had direct financial links with wine-producing interests in France, Portugal, Spain and in other countries. Therefore, it was in their interests to show a decided preference for wine which has its origin in continental countries. They cop it both ways. They get the profit on the distribution of wine in Britain and they profit from their interest in the overseas wine-producing enterprises. The honorable member for Blaxland and I ascertained that the merchants who purchased Australian wine, in the main, were not interested in preserving its Australian identity. But because its quality was so good - it was better in many instances than continental wine - they utilized it in the blending process. However, the consumer in the local inn or cafe never saw Australian wine in the bottle, labelled as such.

As I have said, the central purpose of the bill before the House is to enable the Australian Wine Board to acquire property in London and, perhaps, in other parts of the United Kingdom and in other countries, and to stock those centres with representative samples of Australian wine under their own attractive label. The authority will be able to bring to the notice of customers and others the virtues inherent in Australian-produced wine. I think that the measure is desirable, and I support it.

However, a very great power is vested in the wine-marketing authority. Previously, it had no authority to assume ownership of wine. Under this legislation it will be vested with powers of acquisition. It will be allowed to utilize funds which are obtained from a levy on grapes delivered to wine distilleries in acquiring quantities of wine. That is a very vast power. The Minister, in his second-reading speech, admittedly qualified this power to acquire wines, by adding the words " solely for promotional purposes ". However, I have not been able to find any limitation in the bill on the amount of wine that the board may be able to acquire. Some vignerons may entertain a fear that the board could possibly abuse this acquisition power. As far as I can see, although admittedly I may be wrong, the whole question comes down to a matter of interpretation.

Just how much wine may it be necessary to acquire for promotional purposes? The board might consider it desirable to acquire and sell on behalf of Australian wine producers the whole of the amount available for export in a particular year. Would it be possible for the board to do that, Mr. Deputy Speaker?

Mr Adermann - The board will have the normal powers of a marketing board.

Mr POLLARD - I want to be quite clear on this matter. Is the authority to be allowed to acquire only a certain quantity of wine solely for use for promotional purposes, or does this act in reality empower the authority to purchase any quantity of wine, and to engage not only in promotion but also in direct marketing activities? The position is rather obscure. This is an important matter. Personally, I would not oppose such a power, because I think it is desirable.

Mr Adermann - There is no thin line of demarcation. The board has a power to acquire.

Mr POLLARD - As the Minister knows, until the present time the board's power has been limited to control over, but not extending to acquisition of, wine.

Mr Adermann - The chief deficiency in the present act lies in the fact that the board can sell but not receive and disperse the funds resulting from such sales. The funds have to go into the Consolidated Revenue Fund. The board, therefore, cannot actually work as a promotional body.

Mr POLLARD - It can act as an agent on behalf of a particular owner. I agree that that is so. But under the bill before us it will be able to acquire the wine of a particular grower without consulting him - although, of course, notice must be given - not only for promotional purposes but for purposes of selling the wine and ultimately dispersing the funds to the growers. That is what I want to be clear on.

Mr Adermann - It is desirable to have stocks available, and to ensure continuity of supply.

Mr POLLARD - I follow that, but I want to have the position made absolutely clear. What does this provision mean? Does it mean that the authority is empowered to acquire any quantity of wine it wishes, and to hire or purchase wine stores in London and store vast quantities of wine?

Mr Anderson - It would be limited by the availability of funds.

Mr POLLARD - That is so, but the honorable member for Hume knows as well as 1 do that with even a limited amount of finance, which the board will have, it is possible, on the security of the product itself, to secure finance to purchase considerable quantities. The money raised on the security of the wine can be recouped fairly readily when sales are effected.

Mr Clyde Cameron (HINDMARSH, SOUTH AUSTRALIA) - That would be a good thing, would it not?

Mr POLLARD - To my mind it would, and I would not object to it. 1 am merely wondering whether the Government is using a quick method of securing these powers for the authority, and departing from a widely observed principle which requires that before the produce of primary producers is acquired, a poll is held of the producers concerned.

Mr Adermann - The primary purpose is to take over promotional activities, which have previously been conducted with limited powers. This provision is intended for promotional purposes only. An irresponsible board, of course, could abuse the power, but how long would it continue to function if it did so?

Mr POLLARD - The Minister says, and I accept his statement, that it is intended that the board should acquire only such quantities of wine as are necessary, perhaps, to stock a shop window or to prepare some other display in property acquired by the board in The Strand or some other place for the purpose of exhibiting Australia's wine products. But the Minister adds that it is up to the board not to abuse its power. I do not think it is usual to equip a board with such a wide power as would enable it, subject to financial limitations and its ability to raise money on the security of wine purchased, to acquire, in effect, the whole of the export wines of Australia and market them in such manner as it wishes, and, in due course, to recoup the original owners of the product.

Mr Adermann - I think an additional protection is available. Board members are appointed by the industry organizations, which in themselves are opposed to the board having wide powers of acquisition.

Mr POLLARD - It is true that members of the board are appointed by the industry. They are nominated by the various organizations that are represented on the board, and the nominations are endorsed by the Minister himself. That is a protection, I agree. But the bill envisages a rather unprecedented state of affairs, if I have read it correctly. I admit I have not had time to investigate all the legal ramifications of the bill. One has little time to indulge in such research when one must remain in this House until 6 a.m. But if these wide powers are to be given, without a frank statement to the Parliament that the board will be able to acquire all Australia's export wines, it appears to be rather a sensational departure from the practice hitherto adopted.

Mr Adermann - I think the honorable member missed the point of my last statement. The organizations that appoint members to the board are themselves opposed to general acquisition powers. Their representatives are not going to abuse the acquisition power when they know that their organizations are opposed to general acquisition.

Mr POLLARD - From what the Minister has said, it would appear that this is a matter solely for the discretion of the board. If the board decides, because of a certain set of circumstances, that it is desirable to acquire the whole of the annual wine production available for export, it may do so. It is rather an unusual provision. Personally I would not object to it, providing the wine-growers generally were consulted and a poll were held. It might be a very desirable reform. Tt is certainly rather unusual. b'.it T do not oppose it.

The Opposition supports this measure, despite what appears at first glance to be the vesting of a very wide power in this authority. I believe that the authority will be able to do very useful work for our wine industry. The legislation will result in economy in advertising, uniformity of policy, co-ordination and co-operation between various sections of the industry, and will make available much wider powers to deal with the unfair competition that this industry undoubtedly faces in the United Kingdom and other countries. If the desirable objectives enunciated by the Government can be achieved by this measure, I am all for it. There is no doubt that our wines and brandies, in the opinion of very many connoisseurs, are equal to those of any other country, and it. is the fervent hope of the Opposition that this measure will prove of great benefit to the industry and to the whole of Australia by resulting in increased export earnings.

I leave it at that, Mr. Deputy Speaker, because there are other honorable members, chiefly from South Australia and New South Wales, who wish to speak, and who can speak with more feeling on this subject than I can.

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