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Monday, 6 December 1976
Page: 3298

Mr GROOM (BRADDON, TASMANIA) -Has the attention of the Prime Minister been drawn to the Sente Select Committee report on the Mount Lyell crisis which was handed down last Friday in the Senate? If so did he note the Committee finding that devaluation of itself should ensure the continuance of the mining operations at Mount Lyell without any retrenchments? Has the Prime Minister had any response yet to the call he made in the House last week for the Mount Lyell Mining and Railway Company Limited to reconsider its previous decision to enforce massive retrenchments at Mount Lyell?

Mr MALCOLM FRASER - I thank the honourable gentleman for drawing the attention of the House to the report of honourable senators. I believe it is a valuable and useful report. I would like to commend the honourable senators concerned for having prepared the report so speedily in such a short space of time so that there can be proper publicity for the course of action which is recommended and so that people can understand the facts of the situation. I think it ought to be noted that in respect of this particular matter senators from the Government side and from the Labor side, together with Senator Harradine, came to a common conclusion. I was particularly glad to see that Senator Devitt and Senator Grimes were part of the Committee of inquiry under the chairmanship of Senator Wright, together with Senator Harradine, Senator Messner and Senator Townley. Therefore there is a consensus, among Tasmanian senators at least, that the decision we have taken is of great benefit to Tasmania. Indeed the Tasmanian Premier has given recognition to this, as have trade union leaders in that State. I think one or two specific paragraphs of the report ought to be brought specifically to the attention of the House. The report states:

The devaluation decision converts the Company's forecast cash position during the periods 1977, 1978, 1979 from a calamitous cash deficit of $21 m, to a position of near balance. If the company continues its operations unreduced by the decision of 4 November, it will convert, merely by devaluation, huge deficits into manageable results. It will, merely by devaluation, be enabled to achieve about the same economies as were proposed by the contraction plan ... As the calculations are cumulative over the period, the net result is that at the end of 1979 devaluation has converted an estimated cash deficit, then, of $2 1.233m into a deficit of only $2.755m; which approximates very closely the deficit of $2.638m which the Company planned to achieve by the retrenchment and contraction plan.

I think all members of this House believe that it would be much better to carry on with those men fully employed, especially in view of the community aspects of Queenstown. As I have said previously in this House, it is not just a question of management and labour; it is a community that is very much affected. The Senate inquiry reported:

The devaluation decision and the availability of government guarantees should ensure the continuance of the mining operations and development, on the unreduced scale, without retrenchments.

The government guarantees were in relation to banking overdraft arrangements which had been offered by the government to the industry many months ago and which had not been picked up by the industry. So the Committee's report is clearly underlining that the company ought to be able to carry on, that devaluation has been an enormous help to this industry, likewise, a great help to many other industries and an enormous help to Tasmania as a whole.

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