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Thursday, 3 May 1973
Page: 1650


Mr GARLAND (Curtin) - I want to point out to the Government that it must face up to the structural damage which has been done to the mineral industries of this country. I raise the matter again today because there has been an opportunity of some weeks to see what the effect of the Government's policies on those industries has been. I refer particularly to industries in Western Australia and Queensland, but certainly to industries elsewhere in Australia. This matter affects the national interest because the impact of currency rate changes by the Government has run very deep. I repeat that it has caused structural and permanent damage. The Government made a unilateral revaluation of the currency. It further made a decision - although the Treasurer (Mr Crean) was inclined to say that it was not a decision - not to devalue the Australian currency at the time that the United States of America decided to devalue by 10 per cent. The Treasurer in his Press release of 14th February referred to the decision as not producing much net change in the effective exchange rate for the Australian dollar with its main trading partners. I point out to him that that misses the point.

The point is the relationship with our competitors, and I refer particularly to Canada and Brazil which devalued with the United States dollar. It is not what has happened with our trading partners that is important. What is important is the people against whom we must compete. The actions of the Government, both in the short term and the long term, greatly affect the 2 less populous States of Western Australia and Queensland. I suggest that they are affected more than the Government seems to realise.. They will lose many hundreds of millions of dollars and handouts by the Government of Federal funds of the order of $5m, $10m, $15m or $20m will not nearly compensate in employment or in economic efficiency in those communities. So, I warn again some weeks after those events that the consequences for those States lead to inequities and to unjust treatment. There seems to me to be a strong indication that the Government and the Prime Minister (Mr Whitlam) in particular show an interest, really, only in the 2 big cities of Sydney and Melbourne and are inclined to ignore economic influences - indeed, one gets the impression at times that the Prime Minister disdains to have much to do with economic matters - and to concentrate on the problems of those cities. I stand here this morning and say that the cities of Sydney and Melbourne have problems which need to be redressed by the Government but that other cities, communities and States also have rights and needs. ] take up again the furphy, because it is repeated so often, that the big mining companies ought not to have signed their contracts in United States dollars and I repeat that, in the circumstances of those days, it was impossible to write a large contract other than by tying it to United States dollars. If those contracts had not been written in that way there would have been no development, no contracts and not one new project, Yet the Government says again and again that the mining companies ought not to have tied their contracts to United States dollars because if the Government were to admit the reality, it must accept some of the blame, as indeed it must.

The Minister for Social Security (Mr Hayden), when he was Acting Treasurer, went out of his way in this House to comment about resource allocation in Australia and what he thought should be done. He was quoted in the 'Australian Financial Review' as saying that the present resource allocation was not good. What justification in terms of that statement can there be for the action of the Government in damaging these great industries in Australia? I emphasise that the mining industries in Australia are - or were - among the most efficient industries, if not the most efficient, in this country. The present Government has for a long time gone out of its way to criticise the efficiency of areas of manufacturing and rural industry, but the rnining industry - the one industry which was capable of such great productivity, which was so capi tal intensive, which reversed an unfavourable balance of payments situation into a favourable one and which built up a high standard of living in this country - has now been damaged by this Government. Judging by remarks made by responsible Ministers, the Government apparently extracts some pleasure from this action. The Government's announced plan is to shore up the less efficient industries in the community, having caused this damage to the mining industry.

This is a matter of national interest. I have referred in particular to the plight of the 2 States concerned because of the significant effect on the entire Australian economy. When one hears the intemperate language of the Minister for Minerals and Energy (Mr Connor), who appears to act with excessive aggression, it give serious doubts about the objectivity of his policies and, to me, creates considerable doubt about the fairness of those policies. One can understand the desire of this new Government, filled with its enthusiasms and with some release of frustration, to be progressive and to make changes. But one gets the impression at times that they are changes for their own sake. Through all of this activity to which I have referred this morning there has been an impetuousness in the statements which have been made, a lack of balance and, I believe, a clear impression that proposals are being made without calm thought and objectivity. The Government's actions and statements in respect of the mining industry in particular have been very damaging and the currency changes which were tremendously adverse to the mining industry, were the result of expressed government decision. I say that, even if the Treasurer, in respect of the second matter, tried to pretend that he had not made a decision but had simply allowed the currency to remain as it was when the whole world was considering what it would do in relation to the United States currency as a result of the United States decision - it has a decision. He said that because he did not want to consult his colleagues, the Minister for Overseas Trade (Dr J. F. Cairns) and the Minister for Primary Industry (Senator Wriedt), in spite of the fact that they have great responsibilities to the Australian people and to this Parliament. But he did not consult them, as was clear, in making that great decision.

With respect to the great iron ore developments and other developments which have taken place in this country in recent years, the

Government failed to approach the Government of Japan, at the time it made these decisions. Indeed, I would say that it should have approached that Government before making the decisions because there were a few days when it had an opportunity to try to make some arrangements. The famous British economic journal, The Economist', in its latest edition referred to the unilateral revaluation as 'largely a political gambit'. What a condemnation is that from such an authoritative journal!

Surely the mining industry and the much needed processing of minerals will, in future, provide opportunities for graduates from our universities and will in future create opportunities for enterprise, and for Australians, to justify the retention of our great and remote regions. Mining and processing give us very much opportunity nationally and, in particular, give an opportunity to the 2 less populous but larger States of the federation, Queensland and Western Australia. All States and the whole Australian nation and its interest are involved in this issue.







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