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Thursday, 2 December 1976

Mr WILLIS -Operating profit for the company for 1974-75 of $5.8m represented 580 per cent on paid-up capital, or 88 per cent on funds employed. The dividend payment that year was $1.20 for each $1 share. In addition, 5 directors shared $656,700 in directors emoluments which excluded further fees of $3,000 each. This was for the year 1974-75. The vast majority of this incredibly high remuneration to directors went to one man, the Managing Director of James Patrick and Co., Sir Reginald Reed. The other fascinating aspect of this inquiry has been the revelation that apart from the enormous profits and directors emoluments, the company works on a cost-plus basis for its pricing policy which, amazingly, operates on the basis that as the business expands so profit margins should increase. The so-called logic for this policy is that the larger the business the larger the risk.

The success of this pricing policy from the company's point of view is clear from its exceptional profitability. The impact of this policy on the rest of the economy which pays for this company 's excess profits through higher prices for various products is difficult to quantify but certainly it is very important to disclose such profiteering. Without the Prices Justification Tribunal operating as it has under the Labor Government's legislation, we would never have known of this profiteering. Accordingly, the Opposition is greatly concerned that the substantial weakening of the Prices Justification Tribunal will mean that such exposures are unlikely to occur in the future and that the ability of the Government to ensure that excessive costs are not foisted on the Australian public by rapacious stevedoring companies will be lost.

I want to mention the position of the staff of the Australian Stevedoring Industry Authority who are vitally affected by the Government's proposed scrapping of its direct regulatory role in this industry. The Authority is to be disbanded and the staff of about 220, who are scattered throughout Australia in the various ports, are all to lose their jobs. As practically all of them are not members of the Australian Public Service, they do not have automatic right of transfer to other Public Service jobs. Accordingly, they have been greatly concerned at the Government's intended action. They all received 6 months initial warning of likely dismissal in July this year and they were led to believe, as we were all led to believe, that the Authority would cease to function as of 31 December this year. After some negotiations on redundancy agreements, an agreement was settled which was reasonably satisfactory to the staff of the Stevedoring Industry Authority, but the uncertainty of not knowing precisely when the axe would fall has provided understandable difficulties for them. It was accepted as part of that redundancy agreement that no one would leave for 3 months but that after that time they would be free to go to other employment while retaining the full redundancy benefits.

In fact, however, some staff members who found other jobs were refused permission to leave after the 3 months had expired. That, coupled with the problem of not knowing whether the Authority would cease operation at the end of this year or at some later date, led to growing unrest amongst the staff. However, with the Minister's statement to the House a fortnight ago and his subsequent discussions with staff representatives, the air has been cleared. Staff members have been told that those who obtain an alternative job will be released wherever possible and that the Authority will almost certainly cease operations at the end of June 1977. The initial warning of likely retrenchment has, in fact, been extended to 26 June 1977. Nevertheless, the Government deserves criticism for not keeping the Authority's staff well informed of its intentions and its progress in establishing the new arrangements, thereby causing unnecessary traumas and anxiety to the staff of the Australian Stevedoring Industry Authority. In conclusion, I note that there are still many difficulties for the Government and the parties to the industry to overcome in establishing the new basis of operation in the industry and in establishing transition arrangements that do not disrupt the working of the industry. Hopefully for all concerned these difficulties will be satisfactorily resolved and we will accordingly not need to debate again for the umpteenth time a Bill to extend the temporary provisions that have applied to the industry for a decade.

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