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Friday, 26 November 1965


Mr FOX (Henty) .- It is obvious to anyone who has listened to the speeches made last night and this morning, particularly the speech of the honorable member for Balaclava (Mr. Whittorn), that any objection to the introduction of restrictive practices legislation comes from this side of the House. I am aware that quite a number of my colleagues hold the view that legislation of this nature is in conflict with the principles for which the Government parties stand. I do not support this view and I propose to say why I do not support it.

I am not a legal man so I do not intend to become involved in legal argument with lawyers on either side of the House. The Bill will be analysed fully in the Committee stage. The general principles of the Bill have been explained on numerous occasions by the Attorney-General (Mr. Snedden).

I believe that those principles have been analysed and commented upon at length over a considerable period of time in newspapers and magazines.

I wish to give my views, as a layman, of the reasons for the introduction of the Bill. I wish to give also my views on whether the Bill is in conflict with Liberal principles and whether certain sections of the business community are justified in opposing its introduction. The long title of the Bill states that its purpose is: "To preserve Competition in Australian Trade and Commerce to the extent required by the Public Interest."

Does that purpose conflict with the principles for which the Liberal Party of Australia stands and on which it has been consistently returned to office over the past 16 years? This was referred to by the honorable member for Balaclava, who said that the Liberal Party was returned to office on the principle of setting the sails for private enterprise. The official platform of the Liberal Party includes the following planks -

26.   The preservation of a competitive free enterprise economy.

65.   The prevention of injury to Australian industries through unfair trading methods.

76.   The encouragement, fostering and protection of small businessmen.

Those principles have been embodied in the platform of the Liberal Party since its foundation just over 21 years ago, and for the last 16 of those 21 years the Liberal Party has been elected to office on those very principles.

The Prime Minister (Sir Robert Menzies), in the policy speech that he delivered prior to the last general election, said -

It is of the essence of competitive enterprise that there should be real competition, and that the road to advancement in any business should be open to all. This system we wish to protect.

Privately imposed restraints which are against the public interest or submit the small trader to oppressive limitations should be eliminated.

On that policy speech, this Government was returned to office with a greatly increased majority.

Why should circumstances today be any different from what they were when that policy speech was delivered approximately two years ago? Why should circumstances today be any different from what they were 21 years ago when the platform of the Liberal Party was drawn up? Why should circumstances today be any different from what they have been over the past 16 years during which the Liberal Party has been in government? If the business community objects to those planks in the platform of the Liberal Party, why has it consistently voted for that Party? The first objective of the Liberal Party, as set out in its Federal Constitution, is that it is dedicated to the political liberty, freedom and dignity of man. Nothing in this Bill conflicts with those principles. Why some sections of the business community object to this Bill, I do not know.

Let us see what has to be done by businesses from the time they are established. First, whether a business is a firm or a company, it has to be registered. Secondly, a company has to register its articles of association. Thirdly, it has to file its profit and loss account and balance sheet with the Registrars-General in the States in which it operates. Fourthly, it has to file annually a list and summary of shareholders. All of these documents are open to public inspection on the payment of a very small fee to the Registrar-General of the State concerned.

A company has to conform to the provisions of the Companies Act of the State of its registration. A business is compelled to observe the trading hours laid down by the various State Governments. It has to pay award wages. Each of its buildings has to comply with uniform building regulations. If it is handling food, it has to comply with the health regulations laid down by the various State Governments. It must take out third party insurance with respect to any vehicle that it operates. It must register the vehicles that it operates. Finally, the drivers of those vehicles and all the directors, employees, shareholders and customers of that business, if they drive cars, are compelled to observe the traffic laws. All of those things must be observed in the public interest. Why then should some sections of the business community object to having to conform to a code of business ethics in the public interest? That is all that this Bill is - a code of business ethics.

The fact that the Government has introduced this Bill does not mean, as one member of the Government parties suggested, that the Government regards Australian businessmen as rogues. But, if these laws did not exist, many businessmen would not do many of the things that the various State and Federal laws compel them to do - not because they are rogues, but because of laxity and thoughtlessness. Only the firm or company that does not act in the public interest has anything to fear from this legislation.

Just what is the public interest? I realise that it is not easy to define, but it affects a great many groups of people. It affects - not necessarily in the order in which I now name them - consumers, employees, producers, distributors, importers, exporters, proprietors, investors and, no doubt, many other people. The trouble is that each section of the community is self-centred and selfish in its outlook. The Institute of Public Affairs, which opposes this Bill, has stated -

It is quite unreal to expect private interests to invest huge sums of money without some reasonable security in disposal of products.

The fact of the matter is that two types of business interests are involved. First, there are the businesses that are already established and well protected, by the terms of many agreements, against the ambitions of newcomers. Secondly, there is the business which has not yet become established and which finds it very difficult to get a go. Agreements that operate against these businesses, in effect, protect inefficiency and promote a lazy attitude to business. Thus the country as a whole loses the benefits and advantages of competition.

This Bill is not an attack on orderly marketing, as suggested by another member of the Government parties. My colleagues boast that the Liberal Party stands for private enterprise. That is true. But as far as I am concerned, " private enterprise " means the shopkeeper or the factory with only five or six employees just as much as it means the industry employing hundreds or thousands of workers and making profits of the order of millions of pounds. I have heard opponents of the Bill say: " Why give all of the protection to the consumers? What about the manufacturers? " I point out that many manufacturers are consumers of the components or processes of other manufacturers. It is a well known fact in industry that many retail prices have been forced up unnecessarily by the operation of agreements that react to the detriment of some manufacturers who have to use components that they do not manufacture themselves.

I have heard many people say that this Bill will retard the flow of overseas capital which is very badly needed for the development of Australia. In answer to that, I say that most of the major Western countries have similar legislation which is much tougher than the provisions of this Bill. A substantial proportion of our capital inflow comes from the United States of America, where businessmen have been living with the Sherman anti-trust legislation for a long time. They accept the particularly tough provisions of that legislation as part of their way of life. In my opinion, they are not likely to be deterred by the comparatively tame provisions of this Bill. In spite of the tough provisions of the Sherman anti-trust legislation, the United States is regarded as exemplifying the spirit of private enterprise. Far from being forced out of business, trade associations flourish in that atmosphere in the United States.

The honorable member for Balaclava quoted figures which were produced by the Institute of Public Affairs and which showed the number of hours that a person has to work today in order to acquire certain assets compared with the relevant figures for 1949. Of course the present figures are better; and they will be better next year and better still the year after that. Even under the severe restrictions of the Sherman anti-trust legislation, in the United States wages are higher and consumer prices are effectively lower than they are in Australia. The honorable member for Balaclava referred to the cost of restrictive trade practices legislation to the oppressed people of the United States. I say to him that, far from being oppressed, the people of the United States have a higher standard of living than have the people of any other country.


Mr Buchanan - Did the honorable member have a haircut in the United States?


Mr FOX - No, I did not.


Mr Buchanan - Could not the honorable member afford one?


Mr FOX - I could have afforded one in Britain where the cost is only 3s. 6d. sterling even though anti-trust laws are in operation.

Some people ask why we need this Bill. I hope that people will not delude themselves with the thought that restrictive trade practices are not carried on in Australia. As the honorable member for Melbourne Ports (Mr. Crean) has said, a royal commission was appointed recently in Tasmania to inquire into the activities of 70 trade associations. It found that in fact 59 of them were operating restrictive trade agreements. I believe that another royal commission appointed by the Government of Western Australia arrived at a similar conclusion.

Some people who would not approve of a businessman getting rid of a competitor by burning down his premises apparently regard it as legitimate for him to put that competitor out of business by withholding his supplies or boycotting him or selling goods at prices less than the competitor's cost price or by any one of the many other restrictive devices that are being used by unscrupulous people and organisations at the present time. We have no effective legislation to deal with restrictive trade practices. The Australian Industries Preservation Act can be invoked only after a restrictive trade practice has been in operation, and in many cases this is too late. Why should we always have to wait for something to happen before taking action to prevent it happening again?

By making certain types of agreements registrable this Bill seeks to prevent the use of restrictive trade practices. Why should anyone object to that? Some people object to the registering of agreements and to them I would like to point out that only about 50 per cent, of the prosecutions which take place in the United States of America under the Sherman anti-trust laws are the result of complaints. The other 50 per cent, of prosecutions are the result of fossicking or investigation by the Administration. This Bill is much more lenient than the Sherman act which automatically outlaws many agreements. Under this Bill each registered agreement is examined on its merits and only in the light of all the circumstances will the tribunal approve or reject an agreement.

I believe there should be freedom of opportunity for newcomers to a particular type of business. I believe that competition breeds initiative, self-reliance and flexibility of mind. Competition leads to freedom of choice and surely all Government supporters stand for this. The honorable member for Balaclava referred to the election of 1949. I say that this Government was returned in 1949 because the Opposition sought to deny to the people freedom of choice in banking. I believe there is a real need for the kind of legislation which will foster effective competition in the Australian economy and for this reason and the others I have given I support the Bill.







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