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Thursday, 22 November 1973
Page: 3712


Mr KERIN (Macarthur) - I always admire the way that members of the Austraiian Country Party loyally come into this House whenever their leader or deputy leader speaks in here. This is somewhat contrasted by the interests in wheat displayed by members of the Liberal Party of Australia because at present only 2 members of that Party are in the House. One is the honourable member for Corangamite (Mr Street), who takes a genuine interest in primary industry and the other is my friend Mr Graham who has one of the bigger wheat growing electorates of Sydney. The Deputy Leader of the Country Party, the honourable member for New England (Mr Sinclair) made great play on uncertainty - uncertainty in primary industry at present and uncertainty in business. This is a rather common theme. If I were still farming and growing beef, I would continue to grow beef at present. If I were in farming and growing sheep I would continue to grow sheep or wool at present. If I were in farming and growing wheat I would continue to grow wheat at present.

It just does not seem to square with me that one can say we have reached a position of uncertainty because the wheat stabilisation plan is to be extended for only one year. Growers are in exactly the same position now as they were in at this time last year. That is about the worst that one can say. We all accept that the main reason all along for the wheat stabilisation plan has been to take out the bumps and hollows, the rises in prices, the drops in prices and the problems caused by seasons. We are all aware of these things. These sorts of problems caused the previous Government to introduce quotas into the wheat industry. This has been regretted by honourable members opposite, I think, and it is regretted by us and by the wheat growers. But this is the way that the wheat industry works sometimes. I do not think it is time now to debate the whys and wherefores or the ins and outs of wheat stabilisation itself so much as when the next plan is to be brought into the Parliament.

The main Bill we are discussing today, the Wheat Industry Stabilisation Bill, centres mainly on an extension of the stabilisation scheme for one year. As such, the Opposition largely does not disagree with what is proposed.

Already Press speculation has occurred on the next wheat industry plan. I think everyone knows that another wheat industry plan has been drawn up already and is at present being discussed. In due course it will be introduced. A lot can be said about wheat stabilisation. With the new plan a great deal of work has been done in the last year or so. I mention Mr Callaghans report and the fact that a great deal of work has been done in universities and various other places.


Mr Maisey - The greatest menace that the wheat industry ever had!


Mr KERIN - The honourable member for Moore maintains that academics are a bit of a menace.


Mr Maisey - No, Mr Callaghan.


Mr KERIN - I am sorry. It is a paradox for the Deputy Leader of the Country Party, Mr Sinclair, to say that wheat sales when his Party was in government were a non-political event and to demonstrate now that there is a heck of a lot of politics mixed up in the matter which also has a potential for divisive attitudes in the country.

I point out that even though this plan is an extension for one year only the government has embellished the wheat plan for this one year extension. I am always most happy when people on the other side of the House get stuck into the Minister for Primary Industry, Senator Wriedt, because I take the long term view. I think that in 2 years or 3 years time much of these words, in black and white in the Hansard report, will be used against honourable members opposite by the farmers themselves.

On 23 February of this year the Minister for Primary Industry announced the addition of 10c a bushel on first advance payments. This is the first time that the first advance payment has been changed in some IS years. At the same time, the Minister accepted the proposal by the Australian Wheatgrowers Federation for a national delivery quota for 1973- 74 of 514.4 million bushels, plus 20 million bushels on a special pool basis at any stage when there was excess. On 24 May 1973 the Minister for Primary Industry announced that there would be a second payment for growers from the 1969-70 pool. These measures largely were designed to help stimulate more plantings. Even then the belief was that there would be a growing and better market for wheat.

I think all honourable members are now distressed by the fact that, although there were good wheat plantings and those plantings were going well and the seasons were good, the outbreak of rust has caused some problems to the wheat industry. I was distressed to see only in the last few days, that the estimate for wheat production in New South Wales this year has been reduced from 155 million bushels to 130 million bushels which is a drop of 16 per cent. The Australian Government has committed $500,000 to the locust problem. The weevil affair, if I can describe it in that way, is still the subject of more discussion. But even in this area we are doing something positive as the Commonwealth Scientific and Industrial Research Organisation, through its laboratories at Black Mountain In the Australian Capital Territory, is now investigating other ways of combating the weevil menace in terms of storage in situ.

I am sure that the Minister for Northern Development and Minister for the Northern Territory (Dr Patterson) will speak about the long term wheat contracts. These are certainly the best measures that the Government can take for the industry to try to introduce greater certainty into this area of activity. Another long term wheat stabilisation plan will be introduced and together with long term wheat contracts, we can guarantee more certainty. I do not think that anyone would state categorically that the present world wheat prices will continue to hold. If we are looking at the politics of this matter, I think it can be said also that Canada attained better contracts than we did with China, for political reasons, especially the fact that we knocked at the door at a later time.

There seem to be 2 versions of the problem with respect to the United Arab Republic. One version is that the Australian Wheat Board was not attempting to repudiate the contract with the UAR at all. But I think we can say that the move for cash payment was a repudiation in fact. Alternatively, we can adopt the other version in which people say that the Government was interfering. If the Government did interfere by providing a 75 per cent guarantee to maintain the viability of the contract, this is by far the highest amount in respect of which an Australian Government has ever guaranteed such a contract. That contract provides for the supply of 1.02 million tonnes of wheat each year for a 3-year period, the conditions of sale, including terms if any, and 'the price to be negotiated at the beginning of each year. Even if long term wheat markets can be guaranteed, there is no guarantee that they will be held. In 2 or 3 years time we could need the wheat contract with the United Arab Republic. I think that it is reasonable for the Government to move in this way.

The Deputy Leader of the Country Party has foreshadowed an amendment to the Wheat Industry Stabilisation Bill which will seek to deny to the Minister for Primary Industry the right to issue directives to the Australian Wheat Board. The honourable member will do this when the Bill reaches the Committee stage, later today I suppose. The amendment relates to section 13 (3) of the Act, which provides:

The Minister may give directions to the Board concerning the performance of its functions and the exercise of its powers and the Board shall comply with those directions.

Senator Wriedtused this section to direct the Board to bear 25 per cent of the recent credit sales to Egypt. The Governnent, as I said, is bearing the remaining 75 per cent. I think the Deputy Leader of the Country Party will find it somewhat embarrassing to move that amendment, however, as the power of direction was first inserted in the Act in 1954 by his predecessor, Sir John McEwen. The Leader of the Country Party, Mr Anthony, now says:

I do not believe that the purpose -

He is referring to section 13 (3) of the Act: was ever intended to be to allow the Minister to direct the Board as to how it should carry out its duties. This section was inserted in the Act to protect the industry - not to allow the Government to tell the industry, through the Board how to manage its affairs.

These views, however, are not borne out by research. The section was inserted not to protect the industry but to protect the taxpayer. On 20 October 1954 the then Minister for Defence, Sir Philip McBride, introduced the Wheat Industry Stabilisation Bill 1954 info Parliament on behalf of the then Mr John McEwen. Explaining the new provision to give the Minister power of direction, he said:

It is far from the Government's intention that this should open the way to Government interference in the wheat selling operations pf the Board, but it will be obvious to honourable members and it has in fact been clearly stated to the Wheatgrowers Federation that, as the Australian Government assumes the financial responsibility of guaranteeing the plan from public revenue, then, in the interests of the taxpayers generally, it cannot be indifferent, for instance, to the price at which the Board may be willing to sell wheat at some particular time or to some particular market.

Thus, Sir Philip was saying that the taxpayer had to be protected and, if necessary, the Minister could interfere even on a matter of price. There was no demur from either side of the House.

It is difficult to see, therefore, why Senator Wriedt was not entitled to issue the directive he did to the Board. Mr Anthony had his chance to put things right himself when he introduced the Wheat Stabilisation Act 1968 into the House of Representatives on 23 October of that year. But section 13 (3) remained unaltered. Neither in his second reading speech, nor at the committee stage, did the then Minister for Primary Industry make any reference to the section. There are many people not only in Government but in the industry who believe the Board acted irresponsibly in trying to wriggle out of the Egyptian deal.

The Board welcomed the market with open arms when the China market went bad. Now it says that, unless the next sale is in cash or the Government picks up all the risk, there should be no sale. As I said earlier, the wheel must eventually turn again and the day may come when we go begging to Cairo to buy on terms. I repeat, incidentally, that the 75 per cent of the risk that the Australian Government will carry is the highest percentage that has ever been carried on any wheat deal.

A great deal has been said about politics. I refer to April 1971 when Dr Rex Patterson, who was then Labor's shadow Minister for Primary Industry, directed a pointed question to the then Prime Minister, Mr McMahon, on political interference in the wheat trade with China. I do not think that I should outline all that went on at that time. The political nature of the wheat deals going on at that time was very well demonstrated by Dr Patterson at the time. Allegations were made about interference by the Australian Security Intelligence Organisation. These allegations were never properly denied or discussed in this Parliament. I think it was pretty well established in the minds of everyone that wheat sales have been a large part of politics in Australia. It is a little naive when talking about wheat to say that politics are not involved. I am not saying that this is a good thing, but I am saying that it is something that we all should be mature enough to be aware of.

When the next wheat stabilisation plan is introduced into this House, I hope that we will have a chance to talk about the real deficiencies of other wheat stabilisation plans and that constructive criticism will be offered of the plan that will be brought forward in some attempt to give the industry more assurance of the long term stability which it has at present, I maintain, and which it wants in the future.







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