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Wednesday, 8 December 1976


Mr YOUNG (Port Adelaide) -After listening to the honourable member for Wakefield (Mr Kelly) what can one say? All this year I have taken the opportunity in my role as shadow Minister in this area to speak in debates before the honourable member. Today I took the liberty to speak after him. I think that is probably one of the best speeches the honourable member has made all year. On some occasions when he has spoken I have had to leave the chamber to attend committees or to do something else. I have enjoyed listening to him today. If the honourable member thinks that the talk about tariff cuts stirs up the nervous Nellies amongst supporters of the Government, as he described them, I suggest that he should ask them how they feel about increasing interest rates. He will find that it is usually the same group of people. If it is true that there were nervous Nellies among the supporters of the previous Government, only the faces have changed. The same number are still on the other side. We will have to put up with the same problems.

I do not want to see out my years in the Parliament battering away at the walls as the honourable member for Wakefield has done. Obviously, he puts forward lots of views to which some of us in the Parliament-from both sides- listen, although I am not too sure about honourable members from the Government side who will speak after him. I think they may have views different from those of the honourable member for Wakefield. The Government, of course, has avoided the problem. Over and over again it raises the issue of devaluation. There can be no camouflaging of the effects not so much of the statement which the Minister for Business and Consumer Affairs (Mr Howard) made last night but of the Government's decision on tariffs. There can be no doubt that earlier predictions about the effect of devaluation on inflation still exist. The Treasurer (Mr Lynch) has continually said that he cannot quantify them. All of us could say without fear of contradiction that the effect of devaluation on inflation will be substantial.

Although the fact is that tariffs may have been removed from a small portion of our imports, overwhelmingly the cost input is still there and the consumers in Australia will have to meet it. The missing link from the contribution of the honourable member for Wakefield to these debates of course is the structural adjustment element which is required with tariff reform. In the safe seat of Wakefield with every little industry, sometimes one can take liberties which are a little foreign to the problems than can be taken by the honourable member for Kingston (Mr Chapman) who sits beside the honourable member for Wakefield. I am sure that the honourable member for Kingston would not be at liberty to say some of those things about industry and what could and could not be done in Australia. The honourable member would find that to express a view like that would bring him into conflict with the views which may be held by the manufacturers and the workers at Chrysler Australia Ltd.

I think that we have probably had as many discussions on tariffs this year in the Parliament as we have had in most years. I cannot go back too many years but 1976 seems to have been a good year in that people have been given the opportunity to discuss these questions. I would think that the honourable member for Wakefield and others would have had their fill in relation to tariffs for the year 1 976. But be that as it may, it is impossible to talk about the need for reform if we do not talk about structural adjustment. If we talk about stuctural adjustment we are talking about industry as a whole and about the absence of the White Paper. As I said last night, until we can discuss all these matters there will be a great fear among the working people of this country that tariff reform merely means that they will lose their jobs. If that is the fear which is held by working people in this country, tariff reform will never come about because governments will never have the courage to introduce reforms. It seems to me to be such a simple exercise for us in Australia to come up with the design to look after those people who lose their jobs and perhaps the manufacturers who may have to be shifted or, in some cases, closed down. I think it is important always when discussing what may be the problems of high tariff in Australia also to discuss the welfare and the wellbeing of the people who are involved and affected by decisions which are taken by governments

Far too often these things are ignored. I reiterate what the honourable member for Wakefild said about the 25 per cent tariff cut. For honourable members in the House who take some interest in the matter I suggest that they should forget forever trying to say that the 25 per cent tariff cut completely dismantled Australian industry. At the same time as the 25 per cent tariff cut took place there was such a thing as structural adjustment. People could apply for their full wage for 6 months if the employer signed a document stating that the employee had lost his job as the result of the tariff cuts. Very few people were paid their full wage. There were very few people for whom the employer was prepared to sign the document saying that they had lost their employment as a result of the 25 per cent tariff cut. It did not put 100 000 people out of work. It did not put 10 000 people out of work. It put perhaps a few hundred people out of work. It is nonsense to go on saying that the 25 per cent tariff cut had that sort of impact. All honourable members have to do is read the annual report of the Industries Assistance Commission, and argue with that.


Mr Howard - You will be sorry that you put that into Hansard.


Mr YOUNG - It is true and it has been said from this side of the House on a number of occasions. It is so much hogwash for the Government continually to use the 25 per cent tariff cut as the basis for saying that the Opposition does not think about the welfare of industry or the people who work in it. What the Government is saying is so much nonsense. In the past fortnight we have become accustomed to listening to Ministers telling us that there are 4 arms of the economy with which they are dealing. They say.'This is one arm. That is another arm.' and finally the Prime Minister (Mr Malcolm Fraser) and the Minister for Employment and Industrial Relations (Mr Street) get on to the wages arm. As the honourable member for Wakefield has pointed out, what can the Government do in the field of wages? Obviously it is in a quandary as to the attitude it should adopt at national wage case hearings. It takes the view that one of the ways to overcome the problems is to see that wage increases are kept to an absolute minimum.

Let me cite the figures of Professor Henderson. He says that the poverty line for a man and his wife with 2 children going to a man and his wife with 4 children with the wife not working can go from $120 to $140 a week, averaged throughout Australia. There will be some slight variation depending on the location, but that is a very high amount. Professor Henderson says that that is the poverty line. How on earth can the Government convince the wage and salary earners of Australia that the way out of this economic malaise is for the working people to accept all the burden? Devaluation was extremely generous to some of the vast mining companies in this country. People read in the newspapers about the advantages that flow to those companies as a result of devaluation and they wonder why the Government can say to them: 'You are not going to get $3 or $4 a week increase at the national wage case hearing because we believe that if we can convince the Commission that you should accept less the country will be better off'. At the same time they are reading that devaluation can take the profit of the Utah Development Co. for this year, if it is converted, from $132m to $179m. It seems to me that the argument is balanced all one way.

Obviously, as Bob Hawke has pointed out on a number of occasions on behalf of the trade unions, if indexation is destroyed at the Arbitration Commission we will go back to the old system under which the strongest unions can get the increases they desire and the unorganised workers- the other 30 per cent or 40 per cent of the work force which is not organised into associations or trade unions- will miss out. Perhaps that is the Government's purpose. Perhaps it would prefer some of the strong unions to be able to bargain their way out of the problems while a substantial number of wage and salary earners stay as they are. It is the system that applied for a long period of history before national wage case hearings in Australia. People talk about the problems which industry faced in 1974 and 1975. Let me remind them of what was considered to be a substantial wage lift in 1974. The substantial wage lift at that time was the $24 rise. Earlier in the year the metal workers received $15 and later in the year they received $9. In between those 2 hearings the transport workers received $24.

All the blame is apportioned to the trade unions for receiving those increases in salaries. Most of those decisions were given by wage fixing tribunals. In other cases, because industries were doing so well out of what they considered to be the economic boom, there was very little dispute about what was then considered to be a quite massive wage increase flowing right through industry. So industrial relations, in terms of bargaining, almost disappeared. But why the Government blames the trade unions more than it is prepared to blame industry astounds me. Industry gave the increase because it considered that it could afford it. The wage fixing tribunals gave it. It was not just a case of the trade unions going out on long strikes or industrial struggles to achieve it. It was given as soon as it was asked for. The blame, if there is any blame, for the jump in wages that occurred in 1974 belongs to the community. It belongs to both sides of industrial relations. As we know, there is no benefit in wage earners receiving wage increases of that size at a time of inflation, which bring about higher inflation, because they lose the value of them. So 1974 was a particularly important year as far as industrial relations were concerned, but it was not the fault of the unions that those wage increases were handed out.

I want to refer to a couple of other matters in relation to our industries. I have spoken very briefly about structural adjustment. I think that that is one of the important matters that have to be looked at by the Government. It certainly is being looked at by an Opposition committee, to see what we can do and how we can encourage the adjustment that must take place in this country in view of what may occur, particularly in relation to our educational standards and our population, between now and the year 2000. There is nothing magical about the year 2000; it just happens to be a convenient time scale on which to work, in view of the long term policies that are required for industry in this country. Continually we hear talk of companies in this country going off-shore and the suggestion that all the problems of the companies that go offshore are the problems of high wages. It is not quite as simple as saying that wages are the only things that are driving companies overseas.

Many companies in Australia have gone overseas willingly. There is no way that we can discuss rationally Australian industry competing with the industries to the north of this country. To speak of it as if we could wave a magic wand and get the textile industries, the shoe industries and perhaps some of the component parts of the car industry back into Australia is to talk nonsense. It cannot be done.

Many of the countries to our north are making provisions and doing everything in their power to attract industries. There are many other alternatives under which companies operate overseas and under which they cannot operate here. I refer particularly to the Prices Justification Tribunal, the Trade Practices Commission and some of the other mechanisms which government can put into being here but which do not operate in countries such as Taiwan, Singapore or South Korea. Obviously when they look at their own countries or regions they find that not only do they have an enormous work force now but also by the year 2000- the magical yearthey will have another 800 million people. Are we expected to say that we will do what we can to see that they cannot get jobs? It is not just industries from Australia that go into those countries. Industries from all the developed countries are in those areas. Industries in the United States of America go across the border into Mexico or Canada. That is a phenomenon that has come out of all the developed countries. So, to talk about being able to prevent it with some magical solution is nonsense. Things will change, as everybody says and as all the Government departments say whenever they provide the Government with any sort of document. It is a question of finding the solution in order to accept change. It is a question of taking away the fear that people have of losing their jobs and living on the dole. It seems to me that we should have reached the stage where we can overcome these problems.

It is not a question either of just using the old cliche that we believe in a strong, viable manufacturing industry. Nobody can explain or interpret that cliche. No one is quite sure what it means. To the honourable member for Indi (Mr Holten) a strong viable manufacturing industry relates to all the industries that are in the electorate of Indi. I suspect that if I used that term people would say I was referring to all the industries that are in Port Adelaide. If the honourable member for Brisbane (Mr Peter Johnson) used the term he would be held to mean all the industries in Brisbane.

The fact is that change will occur. We are put here to try to find some solution to the problem, to see how people accept the change in the best interests of Australia and to develop industries which have a long term future.

The only industries that will perhaps have a long term future are those industries which have natural protection or perhaps can be built up as an industry exporting to those regions to the north of us. I think that we have had a reasonably good year for tariff debate. I am sorry that the year ended with a statement from the Government on Pearl Harbour Day. Nevertheless, 1977 may be a better year for us.







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