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Thursday, 28 May 1942


Senator E B JOHNSTON (Western Australia) . - I congratulate the Leader of the Opposition (Senator McLeay) upon having submitted this motion, because it goes to the heart of the present problems of the wheatgrowers. The honorable gentleman certainly set out their present requirements in a highly capable manner. On the 1939-40 crop the quantity of wheat received was 196,000,000 bushels, which realized 4s. Id. a bushel f.o.b. In round figures, £1,500,000 is owing to the farmers, in respect of that wheat. If there is one thing the farmers require to-day more than another it is cash, and I fail to understand why amounts that have accrued to them for a crop that was harvested nearly 2^ years ago have not been paid. Reference was made to the fact that a sum exceeding £250,000 paid by Japan has not yet reached the Australian Wheat Board. That payment was obtained from a credit which was held before the war, and 1 understand that the money reached Australia some time ago. Surely the Government should pay that money out to the wheat-farmers without delay! When largesse is being handed out to other sections of the community, the least the Government can do is to see that wheatfarmers are paid money due to them in respect of wheat grown 1\ years ago. The Government is a trustee for the wheat-growers, and I have yet to learn that it has power to retain money owing to this hard-worked section of the community.

The sympathy of the Assistant Minister for Commerce is appreciated, but sympathy without action is like mustard without beef. It was pointed out that about 4 1/2 d. a bushel is due to the farmers in respect of 64,000,000 bushels of wheat in the No. 4 pool, and representing the harvest of 1940-41. That was a drought year in most parts of Australia and the crop was consequently small. It seems reprehensible that, since this pool has been finalized, £1,500,000 due to the farmers nearly eighteen months ago has not yet been paid to them. I fail to see why the farmers should have to wait for their money at all. The Government compulsorily acquired their wheat and they were not permitted to trade a bushel of it. They could not send some of "it even to other properties which they owned. They were required to deal practically entirely through the board. I recognize that the board acquired the wheat under the provisions of the Commonwealth Constitution, and did so for the purpose of helping the wheat-growers; but that does not lessen the legal obligation of the Commonwealth to pay a just price for it. A just price to the farmer would cover the cost of production and a reasonable "profit, so that he could enjoy the same standard of living as the majority of those engaged in other industries. Evidence was given recently before the Joint Committee on Rural Industries by some of the leading wheat-farmers in the eastern States that the cost of production varied from 4s. to 4a. 6


Senator FRASER - To-day is not the first time the honorable senator has put forward that argument in this chamber.


Senator E B JOHNSTON - It is a good argument, which will bear repetition. Any government which departs from that attitude will hear it again and again from me. If a guarantee means anything, it should be a price to the farmer f.o.r. at siding which covers the cost of production and an Australian standard wage for himself and his employees. Then every one would know what the farmer was being paid for his wheat. I am an unfortunate wheat-grower who for last season's crop received 3s. a bushel, less freight to the port, for bagged wheat, and 2s. lOd. less freight for bulk wheat. The price actually received in cash by farmers was an average of about 2s.' 7d. a bushel for bagged wheat and 2s. 5d. a bushel for wheat in bulk, yet people say that farmers are being paid the guaranteed price of 3s. lOd. a bushel f.o.b. for their product. Should . the war last for another three or four years, is the pool to be charged with storage for that period, notwithstanding that the Government of this country is under a legal obligation to pay a just price for wheat compulsorily acquired? I do not blame the present Government for guaranteeing so much a bushel f.o.b.: that arrangement was made by the right honorable member for Cowper (Sir Earle Page) when Minister for Commerce. I point out, however, that the amount received by producers is not equal to the cost of production, nor is it anything like what 3s. 30d. a bushel sounds when the average resident of Australia hears that rate mentioned'. There is a deduction of at least 9½d. a bushel from that price for freight, storage and handling charges. The Government is under an obligation to pay without delay the £1,500,000 due to farmers from the No. 4 pool for the1940-41 harvest, particularly as we have been told that nearly all of that wheat has been realized.

I come now to the1941-42 pool. Here I express my amazement at the attitude of the Government in regard to the price of 3s.10d. a bushel f.o.b. for 140,000,000 bushels which was guaranteed under the Wheat Industry (War-time) Control Act. That measure was introduced into the Parliament on the 29thNovember, 1940, and provided that 3s.10d. a bushel f.o.b. would be paid for the whole of the140,000,000 bushels, and it was fully understood by every wheat-grower in Australia, and by every member of this Parliament, that farmers would be paid on that basis, and that if the crop exceeded140,000,000 bushels, as, in fact, it did, despite the attempt of the Government to limit the acreage to an area which would produce not more than140,000,000 bushels, the surplus would belong to the farmer and would be paid for at realization. When introducing the bill in the House of Representatives on the 29th November, 1940(videHansard, page 316), the then Minister for Commerce (Sir Earle Page) said -

It must be realized that any wheat grown in excess of the 140,000,000 bushels basis will not participate in the guarantee. The same must, of course, apply to surplus hay, but facilities for its disposal will be provided.

Under the terms of that contract the farmers sowed their seed and the harvest in the pool amounts to153,000,000 bushels. The whole of the surplus of 13,000,000 bushels which hasgoneinto the No. 5 pool from the last harvest is the property of the farmers of Australia, and its realization price under the legislation, which amounts to a contract, with the farmers, should be paid to them, in addition to the 3s.10d. a bushel f.o.b. guaranteed to them.

I pass on to refer to a meeting which took place on the 1st and 2nd May, 1943. I admit frankly that when I entered the Senate to-day I was not fully aware of the representative nature of the gather ing, or of the exact terms of the resolution that it had carried - a resolution which certainly showed an exceedingly strong desire to help the Government of the day in a time of national emergency. At that time, Japan had not entered the war, and the position was entirely different from what it now is. I admit that the resolutions which have been quoted by the Minister were carried by that influential conference, but I do not agree that that could affect a contract between the Government and wheat-growers who were not at the conference. The farmers worked hard on their farms and expected to get3s.10d. a bushel for 140,000,000 bushels and realization price for any surplus which might be produced as was guaranteed to them by the terms of the Wheat Industry Control Act of 1940. The Menzies Government clearly intended that there should he a realization price on the balance.


Senator Fraser - That is the point in dispute.


Senator E B JOHNSTON - Yes, and on my own showing the whole of the argument of the Minister isupset. I have here a copy of a letter which was sent to the present Minister for Commerce on the 26th May, 1942, by Mr. W. C. Cambridge, the secretary of the Farmers and Settlers Association of New South Wales, an organization which was represented at the conference mentioned. I emphasize that the meeting was held on the 1st and 2nd May, 1941, whereas the previous Government's proposal had been passed by the Parliament in December, 1940 - six months earlier.

This is what the Farmers and Settlers Association now says about the matter -

We are aware that a joint meeting, over a year ago, carried a certain resolution, but the matter was taken up straight away with Sir Earle Page and a definite assurance was given" that up to the full quota would be paid for' at the guaranteed price ', and if a surplus was produced on the licensed area, it would be sold when possible and proceeds paid to the farmers ".

That is the policy which the Leader of the Opposition now asks the Government to honour. It is the duty of the Government to satisfy itself whether that statement is correct. I have little doubt that should it find it to be correct - and I am convinced that it is - it will honour the obligations entered into with the wheatfarmers by its predecessor. It is clearly the duty of the Government-to pay the price of 3s. 10s. a bushel f.o.b. in respect of 140,000,000 bushels; and in respect of the extra yield of 13,000,000 bushels to pay to the farmer the price realized for such wheat. Better still, it should take the broad Australian view, and, realizing the value of the industry to the Commonwealth, and making allowances in respect of the difficulties of marketing resulting from the entry of Japan into the war, immediately adopt the suggestion of the Leader of the Opposition that in respect of this extra wheat, it should pay the price of 3s. lOd. a bushel f.o.b. less a deduction of only 9$d. a bushel for all charges. That would mean an additional payment of only 5d. a bushel to the farmer on last, year's harvest, which, [ suggest, is very small indeed, particularly when we remember' that the Government has distributed largesse in the form of charity to worthy sections of the community.. The wheatfarmers, however, now ask not for charity, but for justice; and that- the Government give to their industry that consideration to which it is entitled because it is the greatest source of employment in this country. The letter of the Farmers and Settlers Association continues -

Mr. Murphyand Mr. Cullen are both aware of the fact that Sir Earle refused to make any pronouncement departing in any way from the full guarantee provided by the act. No doubt, the right honorable member for Cowper appreciated the desire of the conference to assist him ; but he realized that the crop had been sold under the contract arranged under the Wheat Industry (War-time) Control Act 1940, whereby the Government was bound to pay 3s. lOd. a bushel in respect of 140,000,000 bushels and to give to the farmer the full price ultimately realized for the balance of 13,000,000 bushels. The Government can easily verify the evi'dence of Mr. Murphy and Mr. Cullen on this matter. I suggest that it should do so promptly, and thus clear up the matter with satisfaction to the growers. The letter continues -

If you were to spread the money involved in the guarantee over 153,000,000 bushels it would he taking 13,000,000 bushels of farmers' wheat, probably worth over £1,500,000 tor nothing

An amount of £1,500,000 would be realized on 13,000,000 bushels at a price of 2s. 6d. a bushel. We now have the extraordinary position under Mr. Scully's recent announcement that the farmers would have been very much better off had they supplied 13,000,000 fewer bushels to the pool. The Minister understands the problems of the wheatgrowers and, I believe, is anxious to help them. I cannot conceive that he would countenance for one minute any suggestion that the farmers should be paid the same amount for 153,000,000 bushels as it was originally intended to pay for 140,000.000 bushels, and to charge to the farmers all the extra expense of handling and storage, &c. Such a suggestion is ridiculous and cannot be justified in any circumstances. Why should the farmer pay freight, handling charges and storage on 13;000,000 bushels of wheat, if the Government intends to take it from him without any payment? The honest thing for the Government to do is to realize that the claims embodied in the motion of the Leader of the Opposition are just and proper, and be a little more generous than was originally intended and pay 3s. lOd. a bushel f.o.b. for the whole of last years' crop delivered to No. 5 pool, and totalling 153,000,000 bushels.

I was amazed when I saw the announcement by the Minister for Commerce (Mr. Scully), published in the press a few weeks ago, that the price guaranteed in respect of 140,000,000 bushels was to be spread over the season's crop of 153,000,000 bushels, with the result that the price per bushel would be reduced from 3s. lOd. to 3s. 6.1d. f.o.b. In other words, he meant to rest on the payment of 2s. 5d. a bushel for bulk wheat and 2s. 7d. a bushel for bagged wheat, which has already been paid, and, incidentally, is unprofitable to the grower and not sufficient to permit the industry to continue. The following report from Griffith appeared in the Sydney Morning Herald of the 21st May. It is a report from Griffith -

The price under the stabilization scheme was fixed at 3s. lOd. a bushel at ports for a crop of 140,000,000 bushels. As 163,000,000 bushels were delivered, the total amount payable by the Government was spread over the whole crop, thus bringing the average down by nearly 4d. a bushel.-

A meeting of the executive council of the Farmers and Settlers Association yesterday protested against the fixing of this all-round price.

The association, it was stated, recognized that the Government's financial responsibility was limited to 3s. lOd. on 140,000,01)0 bushels, but the legislation provided that all wheat grown on the licenced areas for sale hod to be delivered to the Australian Wheat Board, and the former Minister and sponsor of the act, Sir Earle 1'age, gave an assurance that, if the crop marketed from the licensed areas exceeded the quota, the excess would be marketed when practicable, and the proceeds paid to the growers.

Not only at Griffith, but also at every wheat centre throughout the Commonwealth, the growers were of the opinion expressed in that report. No government can afford 'to play further confidence tricks upon the wheat-growers in respect of the guaranteed price for their crop. That report went on to say -

The executive also recognized that the Government was entitled to priority in the selling of the 140,000,000 bushels, and stated tho willingness of growers to defer claims for further instalments on the 13,000,000 bushels excess deliveries until it was sold, but It insisted that it would be "repudiation and confiscation " if the Government used any of the proceeds of the excess deliveries to set off the guarantee on tho 140,000,000 bushels . quota.

I agree with that opinion entirely, ana I appeal fo the Government to investigate the matter thoroughly. I am sure that when it realizes its obligations tto the wheat-growers it will fulfil them.


Senator Allan MACDONALD - - "What was in the mind of the Minister for Commerce when he made the announcement, referred to?


Senator E B JOHNSTON - I cannot interpret the mind of the Minister. He is an honorable man, but I think he must have been misled. The Leader of the Opposition was justified in raising this matter in the Senate this afternoon, and I hope that the motion will be agreed to. The act of this Parliament, passed in 1940, and the promise made by Sir Earle Page when Minister for Commerce alike provide that the price of 3s. lOd. a bushel f.o.b. would be paid on 140,000,000 bushels and the balance held in trust for the wheat-growers. Anything lless than that would amount to robbing the wheatgrower.; of 13,000,000 bushels of wheat at 2s. 8d. a bushel or £1,500,000. I am loth to believe that any Australian government would be a party to an act that would deprive the wheat-growers of portion of their reward for the production of. the harvest.







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