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Monday, 24 May 1965

Senator ANDERSON (New South Wales) (Minister for Customs and Excise) . - I move1 -

That the Bill be now read a second time.

With the concurrence of the Senate, I propose to make one second reading speech to cover the Butter Fat Levy Bill 1965, the Dairy Produce Export Control Bill 1965, the Dairy Produce Research and Sales Promotion Bill 1965, the Dairy Produce Export Charge Repeal Bill 1965 and the Dairy Produce Levy Repeal Bill 1965.

There are two statutory levies currently operating, under separate Commonwealth Acts, which provide the Australian Dairy Produce Board with the funds for overseas market development on the one hand and for research and sales promotion activities in Australia on the other. The levy for overseas marketing development which is applied to exports of butter and cheese was imposed by Commonwealth legislation when the Board was originally established in 1925. The levy for research into dairy industry problems and for sales promotion of dairy products in Australia was imposed by legislation enacted in 1958 on the production by Australian factories of butter and cheese.

Some time ago the Minister for Primary Industry (Mr. Adermann) advised the Australian Dairy Industry Council that the collection of the increasing number of primary industry levies is creating administrative problems for his Department and that he would like the Council to consider, in the interests of departmental efficiency and economy, a proposal that the two levies currently operating be fused into one levy to cover all the Board's requirements. The matter was considered by the Council, which has recommended that the current levies should be consolidated into one production levy to be based upon the butter fat content of the dairy products coming under the control of the Board.

The Council also supported a recommendation from the Australian Dairy Farmers Federation that the income of the Board should be increased to enable it to intensify its promotion and market development activities. Five Bills are necessary to implement the proposals and I feel they can logically be discussed concurrently. The Butter Fat Levy Bill 1965, which is the main Bill, provides for a maximum rate of levy of 6s. per cwt. of butter fat to be apportioned between the three primary functions of the Australian Dairy Produce Board in the following ratio: Overseas marketing, two parts, 2s. 4id.; local promotion, two parts, 2s. 43d.; and research, one part, ls. 2id.

It has been estimated that this rate of levy would give the Board an assured income of approximately £1,100,000 if the maximum rate of levy were applied. The maximum rate of levy represents about li per cent, of the pay rate to producers by butter factories which is expected to be about 46d. per lb. commercial butter basis, equivalent to 55d. per lb. of butter fat, for each of the 1963-64 and 1964-65 seasons. The Board has considered its budget for 1965-66 and has recommended that the operative rate of levy to apply from 1st July 1965, should be 5s. per cwt. of butter fat, estimated to give an income of approximately £900,000 and representing less than 1 per cent, of the expected factory pay rates for butter for 1963-64 and 1964-65 when the pools for these two seasons are wound up.

The estimated income under the current legislation for 1964-65 is about £760,000 and the increase in the Board's budget for 1965-66 reflects the recommendation of the Australian Dairy Farmers Federation that more funds should be made available for promotion and market development. It is proposed by the Board that from the levy of 5s. per cwt., 2s. be allocated for overseas marketing, 2s. 2id. for local promotion and 9id. for research which should result in revenue for each purpose of £360,000, £398,000 and £1.42,000 respectively. This would give the Board an additional £20,000 to finance overseas market development and £118,000 more for sales promotion in Australia. The estimated revenue from the levy for research purposes in 1965-66 is £142,000 compared with £131,000 obtained in 1963-64. The increase in revenue of £11,000 is designed to bring levy payments up to the level of expenditure as small deficits in the past two years have been met from reserve funds.

The four other Bills are machinery measures and are consequential upon the Butter Fat Levy Bill 1965. The Dairy Produce Export Control Bill 1965 and the Dairy Produce Research and Sales Promotion Bill 1965 provide for the proceeds of the levy to be credited to the respective accounts of the Australian Dairy Produce Board in the proportions I indicated earlier. The Dairy Produce Export Charge Repeal Bill 1965 and the Dairy Produce Levy Repeal Bill 1965 provide for the repeal of the current legislation which the new legislation will replace.

I believe that the Council and the Board are acting prudently in planning for increased activities in the field of promotion and export market development of butter fat products. There are already signs that the European dairy industries are recovering from two lean production years and it is strongly indicated that surpluses of butter fat will be re-appearing in world markets in the not too distant future. The Government therefore supports the industry's proposal that the Australian Dairy Produce Board be provided with additional funds for this purpose and welcomes the agreement of the Australian Dairy Industry Council to the consolidation of the dairy levies. I commend the Bills to the Senate.

Senator Cormack - I wish to raise a procedural matter in relation to the business which has just been discussed by the Senate. These Bills relate to a vast arena of recommendations of which there is no evidence, nor is there any information, available to the Senate. I ask the Minister whether he will make such information available before these Bills are debated.

Senator ANDERSON - I shall raise this matter with the appropriate Minister, if he is available, immediately the Senate rises. If not then, I shall certainly do it at first opportunity in the morning, and provide all the available information both to Government members and to the Leader of the Opposition in the Senate (Senator McKenna).

Debate (on motion by Senator Kennelly) adjourned.

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