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Thursday, 22 November 1973
Page: 3727


Mr DEPUTY SPEAKER (Mr Drury (RYAN, QUEENSLAND) - Is leave granted? There being no objection, leave is granted. (The document read as follows) -

 


Mr McVEIGH - I thank the House. Similarly, the matter of interest charges is discriminatory. Interest on overdrafts will be calculated at current rates but the interest factor on the imputed costs for capital will be at lower rates below 6 per cent per annum, additionally. Recent valuations in Queensland on unimproved capital value basis, obtained by an analysis of recent sales, indicated an increase of almost 50 per cent in the capital values over a period of 9 years.

Depreciation does not take account of obsolescence. The Australian farmer has a reputation for being among the most efficient in the world. He has gained this reputation through harnessing modern technical knowledge to practical experience. It is rather odd to claim that they do not change their machinery within 10 years and their buildings within 50 years. The yield devisor remains at 20.25 bushels an acre. The Bureau of Agricultural Economics, in a publication dated May 1973, indicated that with the exception of New South Wales average wheat production per farm was lower than in the 1967 survey. Wheat yield per acre sown in 1972 was 17.9 bushels, 20.7 bushels in 1967 and 18.1 bushels in 1962. The average wheat production per farm in the respective years was 8,848 bushels, 9,731 bushels and 6,790 bushels. Theoreticians have to be made to realise that Australia is a dry land; that rains do not come but droughts, rust and frosts do. The average yield should not be as high as it is. Of course there is no need to spell out that the lower the yield, the higher the cost per bushel to produce. But these are facts and we cannot change facts.

As stated above, if the owner-operator's allowance was a movable factor the cost of wheat would have been higher. By being denied natural justice the community have been subsidised by the wheatgrowers. Incidentally, the people of Australia should be told the truth concerning subsidisation of the industry. The consumer of wheat and wheat products is protected within Australia both in respect to price and availability. Subsidisation to the consumer of wheat in Australia both in the past and the foreseeable future cannot be over-emphasised. As an example it is reliably estimated for the season 1973-74, with the Australian housewife having the advantage of purchasing bread based on a price of wheat at $1.93 a bushel, she is receiving wheat at almost $2 per bushel less in comparison with the ruling world price. On the amount so utilised this represents a subsidy1 to the Australian consumer of bread of at least $80m for the year 1973-74. Of course history records that in previous years a similar position existed. One can recall cheap wheat for the Australian people for 6s 8d per bushel when the overseas price was approximately £1 per bushel. The Government has paid into stabilisation a sum of $299,236,000 since the inception of stabilisation but the growers have contributed in an effort to level out the peaks and the troughs, the sum of $172,015,000. When one also adds the enormous amount of cheap wheat for local use over many years, it is no idle boast that the industry has been subsidising the population. To deny this is simply to refuse to face up to the truth and to resort to cheap political gimmickry. In an economy where the quality of Australian life is protected by long service leave, arbitration courts, tariffs and subsidies I am not prepared to stand idly by while members of the rural sector are denied this same quality of life. They are not second class citizens as the actions of the Labor administration would seem to indicate. We of the Country Party maintain that the same allowances for increased leisure should be inbuilt into the cost factor of establishing the cost of production of wheat.

I remind the disciples who sit opposite and seek to downgrade the rural sector that the rural sector is still on its knees following years of drought, low prices, and costs over which it had no control. Debts are being repaid, but I point out that a recent survey into the farming sector shows that the annual rate of return on capital on wheat farms now stands at 4.1 per cent, having declined from 5.9 per cent in 1967 and 9.4 per cent in 1962. Wheat production is lower per farm, the overall area sown to wheat for grain has slowed markedly and farm receipts still leave much to be desired. With the world crying out for wheat and staple foods we should be encouraging production not reducing it.

I have long marvelled at the fact that there has never been a flow on to the wheat industry of the principle of the margin of profit factor which is part and parcel of every day commercial life. Why is this not passed on to the wheat industry? This industry is part of the Australian population, not apart from it. I submit that when the new stabilisation scheme is being negotiated this should be included. How else can an industry exist without some effort to" cushion the effects of costs being up and returns down? -The Country Party, of course, supports 'the moves which assure long term outlets for ' our 'primary products on a commercial basis and riot as a deliberate instrument of foreign policy. But we stand for agreements which do not deny supplies to traditional buyers for many years, and we condemn too great dependence on countries which have proved in the past that they will buy only when it suits them. It is timely to remind the Labor Party that in September last year the Australian Wheat Board sold to the People's Republic of China one million tons of wheat. I understand that a similar quantity has been negotiated this year. I make the point that this sale was finalised during the life of the Liberal-Country Party Government. Incidentally, total sales to the People's Republic of China over the past 10 years have been 16,485,600 tons. This gives a veritable rebuttal to the Minister for Overseas Trade and Secondary Industry as he then was, who said that the only body which could negotiate long term contracts with the People's Republic of China was a Labor Administration. I congratulate the honourable member for Moore (Mr Maisey) on the magnificent contribution he has made in selling wheat to the People's Republic of China over many years. He was one of the people who blazed the trail. He has made a contribution to the Australian wheat industry which does great credit to himself and to the Party to which he belongs. I seek leave to have incorporated in Hansard a table which shows the amount of wheat sold by the Australian Wheat Board without any government intervention during the period from 1963-64 to 1972-73.


Mr DEPUTY SPEAKER (Mr Drury - Is leave granted? There being no objection, leave is granted. {The document read as follows) -

 


Mr McVEIGH - My final comment concerns the point raised by the Deputy Leader of my Party, the honourable member for New England (Mr Sinclair). The Bill contains a clause which allows the Minister to issue a directive. The people of Australia were appalled at the directive given by the Federal Minister for Primary Industry recently to the Australian Wheat Board to place at risk 25 per cent of growers money with the Egyptian authorities. It is well to remember that there was a 3-year agreement with Egypt which was extended for a further year and became, in essence, a 4-year agreement. It is also well known, particularly by the farmers who were, after all, the people who were hurt in the pocket, that there have been problems with payments. The agreement with the Egyptian authorities does not specify that the sales shall be made on terms. The financial aspects of the agreement are decided in the light of prevailing prices and terms of delivery each year. If effect, there is only a contract to sell a specified quantity. I emphasise that there is absolutely no undertaking to sell on terms. The reason for the inclusion of the clause in the Bill in 1954 was to ensure that the Australian Wheat Board acted in a responsible manner bearing in mind that public funds might be used for stabilisation purposes. For purposes of stabilisiation, the factor is average export prices and any sale which is too low will lower the average and cause a greater public contribution. The power was included to ensure that the best possible sale was made. The Minister - I charge him - has been recreant to the trust placed in him, and his dictatorial action is one of complete irresponsibility. If the Minister wants the wheat industry to be the pawn of foreign policy, it is up to him to pick up the tab and pay the bill. He placed in peril, by his mischievous behaviour, payments to Australian growers. This type of action must be stopped. As a grower I have the utmost faith and confidence in the grower members of the Australian Wheat Board. They are all men like the honourable member for Moore, men of sound practical experience and that is the best university of all. The Minister should not have meddled in their affairs, affairs about which he knows nothing. The grower members, incidentally, are not responsible to him and dictation from him cannot be tolerated. Section 3, paragraphs (a) and (b) of the Act, lays down that the Minis ter shall appoint grower representatives. It provides:

(a)   if there is a State Board in the State - he shall be appointed by the Minister from amongst the members of the State Wheat Board, on nominations of the State Board; or

(b)   if there is no State Board in the State - he shall be appointed by the Minister after being elected by wheat growers in the State in accordance with the regulations.

The Minister has no say. He must do what the growers or the Board decide. I am totally opposed to this capricious action of the Minister in interfering with the elected representatives of the growers. The members are responsible to the growers - the growers elect them - and I say to the socialists opposite that the growers own the grain; keep your hands off it.

Rumours are strong that the Labor machine intends to replace elected grower representatives with jobs for the boys. This is anathema to the industry and the very antithesis of what the industry wants. The crops have been marketed very successfully by people who are concerned and interested because it is their own property. Let it stay that way. We will not accept any breaking down of the status quo. The industry denies that the Australian Wheat Board has reneged on a contract, as has been implied by the Labor machine. That is an untruth and a deliberate misrepresentation. The Australian Wheat Board acted with great propriety and meticulous honesty. By his actions the credibility of the Minister will be forever in doubt.







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