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Thursday, 7 October 1971
Page: 2056


Mr BUCHANAN (McMillan) - The first thing I want to say is something that I have said on the occasion of the consideration of these estimates for several years now. We are debating the estimates for the Departments of Customs and Excise, Primary Industry and Trade and Industry. Each honourable member is given 10 minutes to debate this group of departments and it is impossible to devote sufficient time to a thorough consideration of all of the items that one would want to discuss under any one of these heading. One has to skip from one department to the other and in doing so one cannot do justice to any of them. This reflects the absurdity of the way in which we examine the Estimates. Honourable members, including myself, have to spend the time available in developing some of our ideas rather than engaging in an examination of the Estimates themselves. I do not propose to ask for any explanations of any of the items. However, I want to comment on one or two of them.

Firstly, I wish to refer to the Department of Customs and Excise. One of the problems that we find in our daily discussions with people who have difficulties in regard to by-law entries is the time that is taken to get a decision and the nature of the decision when it is made. We are very grateful for the fact that another Tariff Board member is to be appointed to enable decisions to be made more quickly. This is very good. But it is said that even when this member is appointed decisions will probably take 2 months to make. This seems to be quite wrong. We could have a situation in which a manufacturer who was trying to establish a certain process could be held up because a decision on some type of material that he wants is deferred until after some very exhaustive inquiries have been made. I cannot understand the attitude of some people who want to import a certain article which they could very well buy here. In that type of case they ought to be required to buy their article from the Australian manufacturer. However, we could have the situation in which, although the Australian manufacturer of a carburettor said that he was capable of making that article for a certain type of engine, we knew perfectly well that the carburettor which he made would not fit on a specified engine, was not a suitable equivalent or would not be efficient or effective.

I recall one case in which wire rope was required for the reinforcement of a concrete bridge. Magnificent wire ropes are made in Australia and I believe emphatically in giving all the protection, comfort and benefits to Australian manufacturers in order to promote industry ' and to create employment. However, in this case the Australian machinery was not capable of making wire rope one-sixth of an inch bigger as required in the architect's specifications. It seems ridiculous to knock something back like that. In this case inquiries were made to ascertain whether the wire rope could be made in Australia and it was found that Australian manufacturers could not supply the product. Of course, the manufacturer could supply the product if he had the right type of machine.. But he would not acquire such a machine' to produce wire for one bridge. I do not see why we should reduce the effectiveness of our bridges because we do not produce 'wire rope of the size required in Australia:

I go from that subject to the , Tariff Board itself. I want to register my amaze ment that the Tariff Board keeps coming out with an effective rate of protection. For some years now we have had lectures in the annual reports of the Board on Australian manufacturing industry. The Board seems to be developing a theme of trying to take the actual development of Australian manufacturing industry from the place where it belongs - in the Department of Trade and Industry at present. I will come to that point again in a minute.

The adoption of an effective rate of duty is understandable if we take this rate in its simple form. But anyone who tries to follow through the absurd formulae which the Board has asked us to apply must get himself into trouble. Officers - of the Department of Trade and Industry have gone to great trouble to try to convince me that their calculations on the effective rate in the cherries case was accurate. The calculation may have been accurate according to the formula which they used, but I believe that it is nonsense to try to equate such a formula in a commonsense way to a tariff on a particular item.

In passing I would like to comment that it is even more unfortunate that some members of Parliament seem to be maintaining the idea - and this is supported by a lot of people outside - that tariffs are necessarily against the interests of primary industry. The persistence of this view is not in accordance with the facts. Many primary industries have very large and severe tariff protection. Although it is argued these days that many tariff rates apply in industries which do not need them, those levels were set for particular reasons. Before we dismantle any of these old tariff items which are not being used by certain industries at present, we should have a close look at the position. It is argued that the tariff rate is there so consequently industry should charge as much as it possibly can to keep within that rate. It is said that industries are taking full advantage of the tariff in the price they are charging. Several reports have stated that this is not so. In actual fact there are higher profit rates . on the imported products than there are on the locally manufactured article. The local manufacturer remains in business because the high tariff rates deter people from competing. If the rates were to be taken away all of a sudden, massive unemployment would result. i notice that in the estimates of the Department of Trade and Industry there is provision for an increase in the number of officers particularly in the Third Division, from 112 to 138. Also, there is a 40 per cent increase in the amount of money allotted to the Department for this purpose. We know that the Department has been building up a section which will make economic assessments. This section will examine industries, produce reports and so reputedly help the Tariff Board to make its decisions. I want to say once again - I have said so several times in this place - that it is quite wrong to build up the Tariff Board into a great empire as far as manufacturers are concerned. What is really needed is that control of the secondary industry section of the Department of Trade and Industry, which is taking over all those officers who are being recruited by the Tariff section, should be transferred to a separate department. The real purpose of this section should be to examine the fundamental economics of manufacturing industries, as they are to assist those industries, and not to bring up information to the Tariff Board which would pull those industries down. At present the section is advertising for econometricians which is a new term brought in by the people who developed the type of formula to which I have referred. Simple people like us in this House are not able to understand this jargon. They are developing a tariff policy based on mathematics and not on common sense.







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