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Tuesday, 22 February 1977


Mr RUDDOCK (Parramatta) - It is always a pleasure to follow the honourable member for Burke (Mr Keith Johnson) because I find his remarks so stimulating. It is a pity that he has to distort and misrepresent the position that is explained in the clear words used in the legislation which is before us and to try to misrepresent to the Australian people the purpose of that legislation. It is a pity that he has to distort it by using comparative words like 'Hitler' and 'honesty' in relation to honourable members on this side of the house. I find that totally unworthy of him, as would every honourable member on this side of the House. There is no way that we will be labelled with those sorts of malicious charges. I resent it very much.

While we are looking at some of the matters he raised, let us look at the content of his speech. It is important that in an Act of Parliament which applies to most people in the community and which has in it quite harsh penalties- not penalties that we have imposed but penalties that were imposed by a government of the political persuasion of the honourable member for Burke -


Mr Keith Johnson (BURKE, VICTORIA) - No.


Mr RUDDOCK - Yes, a government of the political persuasion of the honourable member for Burke, because it enacted this particular item of legislation. We are debating a Bill relating to an Act of Parliament which has an effect on corporations and individuals. That is the effect of the High Court decision of the other week; it has an effect upon individuals. If the honourable member is saying to us on this side of the House that there are other people in the Australian community to whom such legislation should not apply if they are in breach of that law- that is what he is saying to us, that there is one group of people to whom the law shall not apply but that it shall apply to all others with all the harshness and all the penalties that his Government saw fit to include in the legislation- and if that is what the honourable member refers to as honesty, then I think it is quite clear that all the honesty rests on this side of the House.

I refer the honourable member for Burke to section 51(2) of the Act which will read:

In determining whether a contravention of a provision of this Part other than section 45d or 48 - which refers to mergers- has been committed, regard shall not be had-

(a)   to any act done in relation to, or to any provision of a contract, arrangement or understanding to the extent that the provision relates to the remuneration, conditions of employment, hours of work or working conditions of employees.

There were 2 provisos mentioned there. One was section 48 which related to mergers, and I do not think that would affect those matters about which I have spoken, and the other was section 45d. I ask the honourable member, and I ask the Australian people, looking at the words- not read in total but looking at the specific operative words which are relevant in section 45D- to note that the action can be taken to deal with boycotts, to deal with a situation of employees who engage in conduct or in concert 'for the purpose of hindering or preventing the supply of goods or services by the employer to a corporation'. What is wrong with that? Does the honourable member think that employees should be in a position to hinder or prevent the supply of goods or services by an employer to a corporation? Does the honourable member believe that in all cases? I think that is where we differ quite substantially. I believe, as do all honourable members on this side of the House, that we went before the people in December 1 975 with that in our policy. I have heard some people in government in New South Wales where there is a one seat majority speak about mandates. Look at the size of that rump on the other side of this House. We will talk about mandates. The Australian people endorsed this Government and its policy proposals because they did not want those boycotts; they did not want that sort of malicious conduct from people like the honourable member for Burke, who spoke before me in this debate and who made it clear that the unions want to be able to hold other people to ransom, that they want to be able to deal in a harsh and unconscionable way with other people's property and the rights of the individual.

While I am on this matter, let us look at the position of the people in New South Wales whom I represent- not the people in Victoria whom the honourable member represents who have not had imposed upon them as a result of a union boycott prices for petroleum products that are extortionate in the extreme. The people of Victoria are subsidised by the people of New South Wales. If honourable members want to know why New South Wales is going down the drain they should ask themselves what is the effect upon the people of New South Wales and the industries of New South Wales of additional petrol price increases which have been brought about by the trade union movement that honourable members opposite defend and represent. These increases have been brought about by the boycotts of the Transport Workers Union. Their attitude is totally unconscionable, totally dishonest and has brought about a situation for which we have a mandate to remedy- and we shall do so. I pledge myself to oppose any amendment to this sort of provision which, quite clearly, the Australian people have demanded.

I want to deal with the Bill in a broader way. I support the proposals in general as well. There has been some criticism of this legislation. The honourable member for Port Adelaide (Mr Young) made reference to some of these aspects in his speech. He wondered whether there was demand by the Australian people for an amendment -

Mr DEPUTY SPEAKER (MrLucock)Order! Can we have a cessation of private debate?


Mr RUDDOCK -I do not know that I needed that assistance, but thank you, Mr Deputy Speaker. I shall endeavour to carry this matter further and to cover some of the very important aspects of this legislation which will assist the Australian people and will assist in the provision of jobs and creating certainty in manufacturing industry. Whether the honourable member for Port Adelaide wants to ignore it or not, very widespread concern was expressed about the legislation that applied previously in the Trade Practices Act. That matter was the subject of considerable public discussion. It was a matter of great debate during the previous general election. I believe, as do all honourable members on this side of the House, that we have a mandate- I use that term advisedly- to proceed with the introduction of legislation that will restore certainty and clarity to the present legislation. Such consideration was one of the principal tasks that we expected the Swanson Committee to perform. We wanted to ensure that manufacturing industry would be in a position to be able to proceed without being unduly hindered in its tasks by claims that can be brought, very often without adequate reason, before the Trade Practices Commission. We wanted to ensure, where we could, that where issues had to be decided the law was given clarity where it had not been clear to date. I do not think anybody would disagree with the sorts of concepts that people speak of as being a requirement for trade practices law. It is rather the way in which we seek to amend the legislation that is important. Trade practices law concerns a set of market practices, market behaviour, market power and the structure that endangers the competitive processes. The main goals of competitive policy are competitive prices, efficient methods of production and innovation. There are important objectives and I do not think anybody would disagree with them. But we have to look at the particular provisions in the Act and ask ourselves whether those provisions bring about that sort of situation.

We have discussed tonight in considerable detail the sections dealing with prices discrimination. The honourable member for Grayndler (Mr Antony Whitiam) cast doubt upon some of the suggested amendments that were brought forward in the Swanson Committee report. I should like to commend to all honourable members the reading of section 7 of the Swanson Committee report, which deals with price discrimination. That particular section spells out in some detail the important considerations that affect this matter of certainty, the matter of jobs and also the important matter of manufacturing industry being able to be successful. The section dealing with price discrimination has been the subject of considerable discussion because of the involvement and the conflict of that section with the operations of the Prices Justification Tribunal. We have seen also that the practice of quantity discounts has been emasculated. We have seen that these provisions have worked to the detriment of consumers in the maintenance of prices at a higher level, which has discouraged volume sales. That has had an effect upon manufacturing industry. Whilst that section speaks about the lack of price flexibility, these provisions must be examined.

What we have seen happening in Australia has occurred frequently in the United States of America. If honourable members would care to look at an article by Mr Charles Filgate Giles appearing at page 555 of the Australian Law Journal of November 1976 they will see, under the heading 'Price Discrimination- s. 49', some more detailed reference to the United States experience, which has been very similar to our own. As yet not many cases have been brought here to decide what the section means. There is a great deal of uncertainty as to the intention of this Parliament arising from the language that has been used in the Act. In the United States a great deal of criticism has been levelled at the varying interpretations that courts have placed upon some of the terms used. That might not happen here, but it may. While that prospect of uncertainty exists, is it any wonder that the price discrimination clauses have not been effective?

The honourable member for Grayndler made reference also to the commentary by the Trade Practices Commission on the Swanson report. I went through the commentary and looked for the powerful arguments that he suggested would persuade me to another course. I looked at the commentary and found that it was couched in the same sorts of generalisations, with the same sorts of general statements, as it was criticising in the Swanson committee report. Regrettably, in this area we are not dealing with specifics- there is no finite data available upon which we can make our decisions. We are making them on the basis of judgments. But very important questions are involved. Indeed, it has become clear that there has been a maintenance of higher prices as a result of that particular provision. That is my view and that was the considered view of the Swanson Committee when it had before it the numerous representations that had been made to it.

While we are talking about representations, the honourable member for Grayndler suggested that he had received great volumes of representations from small retailers asking that this particular provision be maintained. It may well be that he has had representations passed on to him by the spokesman for this matter on the other side of the House. It may well be that the Minister for Business and Consumer Affairs (Mr Howard) has received some such representations. But I can say that in moving around my electorate- the large city of Parramatta- I have not had people coming up to me and saying: 'Ruddock, you have to maintain those price discrimination clauses because to do otherwise would have a disastrous effect upon small business'. That sort of view is simply not abroad in the community.

There are some other matters with which I want to deal. I think I have dealt in some detail with selective boycotts. I want to cover two other aspects, the major one of which relates to the Minister's statement on the applicability of this legislation to government. I remind honourable members of the statement by the Minister when he said that governments are becoming increasingly involved in commercial activities often in direct competition with private enterprise. It is anomalous that the Trade Practices Act should apply to private enterprise and not to government enterprise of a commercial nature. The Minister went on to indicate that at present an interdepartmental committee is examining the detailed implementation of this proposal. I want to encourage the Minister to ensure that this committee reports promptly.


Mr Howard -It has.


Mr RUDDOCK - Well, I hope the Minister can assure us that he will adopt new provisions very shortly- perhaps when we consider these amendments when the Parliament resumes in a fortnight's time. In my view it is important that statutory corporations operating in direct competition with private enterprise should comply with this legislation. Statutory corporations should not be allowed to continue to be immune to this legislation. We do not often hear about State corporations such as the dockyard at Newcastlea New South Wales socialist enterprise. We do not often hear that and we want to hear that this legislation will apply also to those socialist enterprises and the statutory corporations of the States. I hope that the interdepartmental committee looks at some of those aspects. This may lead us to some conflict with States, but I would hope that this legislation would apply to all trading corporations, be it Trans-Australia Airlines vis-a-vis Ansett Airlines of Australia or be it Medibank vis-a-vis the private health funds.

In recent history let us look at a letter by Professor Peden of Macquarie University on Labor Party advertising, in relation to Medibank, in which it is suggested that Medibank was free. In a letter in the Sydney Morning Herald of 5 November 1976- honourable members might like to refer to it- he makes reference to this problem. This sort of advertising could be prompted by a government for political reasons. It was not capable of being reviewed by the Trade Practices Commission. I believe it should.

The other matter with which I will deal briefly is public hearings. We know, of course, that the manner in which public hearings of the Commission are to operate is to be changed. The Swanson Committee, in dealing with conference procedure in its report from page 240 onwards, mentions that the proceedings ought to be made simpler and implies that people who might offer professional advice to companies ought to be excluded from those provisions. I suggest to the Minister in relation to small companies that are not in a position to have on their boards a solicitor, a barrister, an accountant or somebody like that who can argue their case with some familiarity that those companies will be put at a disadvantage in comparison with the larger companies in some of these exercises. I think we ought to look much more closely at whether or not the smaller companies ought to be able to get some advice in that way.

Another aspect which I wish to cover deals with secrecy. I think it is important that we pay some respect in this legislation and in the way in which we examine it to some of the aspects of corporate property. In this I mean trade secrets, patents, items on which companies have contributed valuable research, development, knowhow and so on and other matters that have been mentioned to me such as the money price of a merger and details of current costings. I believe that in the examination that is to take place much of the secrecy is preserved by the new procedures that have been adopted. I have not examined this aspect of the Act in detail. One of the things that I would be looking for in my own personal examination of these provisions is that these valuable items of corporate property are protected. There is a public interest to which we must look as well. I believe that it is important in the public interest that people who have invested money in companies in the knowledge that they will have certain corporate assets and advantages that sometimes those corporate assets bring have their investment protected. I am pleased as I speak in this way to see honourable members nodding some approval in relation to these aspects. It is of fundamental importance in this legislation that there is the protection of minority interests, that there is the protection of the rights of individuals and that there is genuinely equality before the law.

Let me return to the point upon which I started. We know that in this legislation as previously drafted certain people were exempt from its rather onerous provisions, onerous as they have been described by honourable members opposite even though they legislated for the provisions. I want, in my consideration of this legislation- and I am sure at least all honourable members on this side of the House do- to ensure that all people are equal before the law and that the law applies to individuals, corporations and groupings of people to a like extent so that any trade practices which are unreasonable can be stopped.

Mr DEPUTY SPEAKER (Mr Lucock)Order!The honourable member's time has expired.







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