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Tuesday, 15 March 1966

Mr BRIDGES-MAXWELL (Robertson) . - It is regrettable that the honorable member for Oxley (Mr. Hayden) spent so much of his time trying to cast suspicion on the Minister for Trade and Industry (Mr. McEwen) who negotiated the New ZealandAustralia Free Trade Agreement. The honorable member spent much of his time trying to point out that the Queensland dairy industry is in financial and economic difficulties, which is granted; but there is no relationship between the economic difficulties of the Queensland dairy industry and the Trade Agreement. He also went on to say, when he was denigrating me Minister, amongst other things that the Minister had not consulted the industry at all. The Minister for Trade and Industry, in a speech that he delivered to the State Council of the Queensland Dairymen's Organisation - and the honorable member for Oxley quoted from a newspaper report of that speech - stated that he had consulted with the chairman of the Australian Dairy Produce Board. The honorable member for Oxley went on to say that the Minister did not consult afterwards with the industry. It was at the specific request of the State Council of the Queensland Dairymen's Organisation that the Minister went to Brisbane on 8th December.

On the question as to how the Agreement will affect the dairymen in Queensland, the Minister in his speech on that day stated that the importation of the additional cheese, on present average prices, would cost the dairymen of Queensland 30s. in the first year of the Agreement. When the absolute limit of 1,000 tons per annum comes into effect after five years, on present average prices, the loss will be some £8 per year. On the other hand, these same Queensland dairy farmers are receiving an average of £245 in subsidy from the Government. I think that this is the answer to some of the points that were raised by the honorable member for Oxley and his colleague, the honorable member for Capricornia (Mr. Gray). I wonder how much of the distress and worry of the Queensland dairy farmers has not been caused by misinformation which was given by honorable members opposite in the middle of last year when discussing this subject and the subject of pig meats, which I shall deal wilh later on.

In my view, this is an historic Agreement. It follows a number of other trade agreements that have been negotiated by this Government and which have materially benefited this country in its development. It will provide for far closer ties between Australia and New Zealand. We have great traditional ties with New Zealand. We have, of course, the great Anzac tradition. We are involved with New Zealand in treaties such as the Security Treaty between Australia, New Zealand and the United States of America, the South East Asia Treaty Organisation and in the Commonwealth.

The objectives of the Agreement ire set out in Article 2, which states -

The objectives of the Member States in concluding this Agreement are -

(a)   to further the development of the Area and the use of the resources of the Area by promoting a sustained and mutually beneficial expansion of trade;

(b)   to ensure as far as possible that trade within the Area takes place under conditions of fair competition; and

(c)   to contribute to the harmonious develop ment and expansion of world trade and to the progressive removal of barriers thereto.

The objective contained in paragraph (a) is the important one because this part of the world is facing great pressures, both economically and from events in our north. There is great need for rapid development, not only of Australia but also of New Zealand. We need closer ties not only in the economic field, but in .the defence fields. The benefits that will flow from closer trade arrangements with New Zealand will assist in building the industrial complex, which is so essential from a defence point of view and from the national welfare point of view.

As I said before, I believe that this historic Trade Agreement is of great importance. It is one that will lead to greater understanding between these two peoples, as my friend, the honorable member for Mackellar (Mr. Wentworth) so clearly pointed out. We, as much as the people of New Zealand, need larger markets. This Agreement will bring great benefit to both nations. At present the trade between the two countries is in the vicinity of $200 million - $158 million for exports from Australia to New Zealand and approximately $40 million for imports into this country. The Agreement covers 60 per cent, of the total trade between the two countries. On the national or international level, it is of great importance that this trade be expanded and, as mentioned in the objectives to which I have referred, the Agreement will provide for the freer movement of trade throughout the world. This Agreement will give us easier access to the New Zealand markets for our goods. In return New Zealand goods will have easier access to our markets, subject to certain protections and limitations with which I intend to deal. The main objections that have been raised by honorable members opposite are related basically to cheese, pig meats and frozen or processed vegetables.

Before this Agreement, there was no limitation on Australian cheese imports from New Zealand except that there was a duty of 6d. per lb. Under this Agreement, for the first time in the history of the Australian dairy industry, there will be an upper limit - a quantitative limit - on cheese coming into Australia from New Zealand. What would have happened if Great Britain had entered the European Common Market and both Australia and New Zealand had lost all or a great part of their share of the British market? New Zealand could have put cheese on the Australian market, after paying the duty, until this Agreement was implemented. Now, whatever happens to Great Britain and the European CommonMarket, New Zealand is not able to export to Australia more than 1,000 tons of cheese. This protection was not sought by the industry but it is being provided and I foretell that it will be of great benefit in protecting the industry.

Last year Australia imported some 260 tons of cheese upon which duty was paid. Under the terms of the Agreement, in the first two years 400 tons of cheese will be allowed into Australia. In the third and fourth years 800 tons will be allowed in and then there will be the upper limit of 1,000 tons. As I said earlier, dairy farmers will have to export cheese in equivalent quantities and on present prices dairymen throughout Australia will be affected to the extent of £12,000 in the first year. I think that was the figure mentioned in a speech by the Minister for Trade and Industry or in an answer he gave to a question. The cost to the Australian dairy farmers will be £48,000 in the fifth and final years on present costs. But it has been pointed out that as the Australian population grows, the effect of this importation will be less.

The honorable member for Oxley referred to the Minister's speech and said that the Minister had not consulted the dairy industry in Queensland. A very valid point came out of the discussions which the Minister had with the Queensland Dairymen's Organisation on 8th December but it was not quoted by the newspaper to which the honorable member for Oxley referred. The Minister said that the answer to the dairymen's problem in Queensland was to lift production. As one member of the Queensland Dairymen's Organisation said to the Minister, the development of the new tropical legumes and pastures will have a tremendous effect on production. I think the words used by one member of the Organisation were that this development would lead to a breakthrough similar to that achieved in the southern States when grasses and clovers were developed. This is undoubtedly true. The Organisation asked the Minister on that occasion whether or not he would make representations to the Minister in charge of the Commonwealth Scientific and Industrial Research Organisation to step up research in Queensland and whether there could be greater financial assistance for that purpose. I am sure that the Minister has made those representations.

During the recent parliamentary recess, the Minister for Primary Industry (Mr. Adermann) announced to the Australian Agricultural Council that there would be a quadrupling of Commonwealth funds for agricultural extension services. Of course some of this money will go to Queensland in proportion to the grants to the other States. This will help the Queensland dairy farmer. It is not fair, nor is it honest, to say at this stage that the New ZealandAustralia Free Trade Agreement will put farmers off their properties, as I think the honorable member for Capricornia (Mr. Gray) said. I believe the Agreement will have a minimal effect. It will cost the dairy farmer in Queensland on the average about thirty shillings a year.

In 1963-64 some 2,600 tons of pig meats were imported from New Zealand. Since then, because of trichinosis, there has been a total embargo on the importation of pig meat into Australia from New Zealand. The fall in prices mentioned by honorable members opposite has followed, I believe, the normal fall in recent years. The graph for the last three or four years shows a normal dip in September. As my colleague the honorable member for Riverina (Mr. Armstrong) has said, prices have risen since and seem to be following the normal trend. If New Zealand controls trichinosis, 3,000 tons of pig meat from New Zealand will be allowed into Australia duty free under the Agreement, but such imports will be strictly supervised. This pork will go only to processors, as it has in the past, and not to butchers. These processors will be asked to ensure that they do not alter their buying pattern or lower the price on the home market. This undertaking has been accepted in the past by processors in Queensland and I think it is common in other agreements we have such as the meat agreements.

The Minister for Trade and Industry, in his speech on 8th December to the Queensland Dairymen's Organisation, said that the same supervision would be undertaken if pig meat is imported from New Zealand. He added that it would be very much easier to supervise the comparatively few processors of pig meat than to supervise the very large number of people who purchase red meats. I believe that these guarantees will protect the pig meat producers of Queensland.

When figures for ham and bacon were taken out last in 1963-64, they revealed that a total of 43 tons of ham and bacon was imported from New Zealand in that year and consumption on the local market was 43,000 tons. It cannot be said, therefore, that the importation of 43 tons would disrupt the Australian market. Total production of pig meats in Australia is about 121,000 tons. Therefore, the 3,000 tons from New Zealand which would come to Australia under the terms of the Agreement would be negligible.

Above and beyond all these facts, the three industries that are primarily worried about this Agreement - the cheese industry, the pig meat industry and the vegetable industry - have great protection under it. The Minister for Trade and Industry, in answer to a question I asked in the House last August, said in relation to the pea and bean industries -

We took steps to consult with those people, both on the processing side and on the growing side of the Australian industry, who were able to give information. So that honorable members may see this matter in perspective, 1 point out that, under the existing arrangements with New Zealand, for I think seven or eight years there has been a sliding scale of duties and no duty is payable where the product is exported at a price above a certain level. In order to illustrate the degree of competition, I mention that 4,300,000 lb. of peas and beans were imported from New Zealand in the two years ended June 1964 and only £14,000 of duty has been paid on those peas and beans. There has been no disruption of the Australian industry in those circumstances.

I believe that this Agreement will not have any deleterious effect on this industry. I can assure the honorable member that if mere is any disruption, I will be the first to bring it to the notice of the House. That is specifically mentioned in the Agreement. The protection given to our industries is that consultations can take place. We have very close and friendly relations with New Zealand. If one of our industries is about to be directly affected - for instance, :f there will be unemployment or some financial loss - the machinery is in the Agreement to protect it. Consultations can occur immediately, and within 60 days there can be-

Mr Allan Fraser (EDEN-MONARO, NEW SOUTH WALES) - That will be closing the stable door a bit late.

Mr BRIDGES-MAXWELL - -I do not think so. There can be immediate consultations. Statistics will be kept. The protection that is in the Agreement is that under Articles 8, 9 and 10 an industry has immediate recourse to the Government, which has the power to consult with the New Zealand Government. Australia and New Zealand are friendly countries. The purpose of this Agreement is not for our countries to harm each other. The purpose, as set out in the objectives, is to promote the economic and social development of the free trade area, and later of our Territories, as provided for in Article 13.

Although I respect the fears that have been expressed by the industries concerned, I believe that they have that protection and consequently that the Agreement will be of great national benefit. It will be of benefit to the growth of our economy and, more importantly, to the growth of the New Zealand economy, with its rather narrow stucture. It will allow a more rapid development of our population and of our nation. What is of even greater importance is that it will bring two countries closer together in this part of the Pacific area at a time when we need very close and friendly relations.

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