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Thursday, 24 August 1972
Page: 392


Senator O'BYRNE (Tasmania) - The debate on the report of the Senate Standing Committee on Primary and Secondary Industry and Trade concerning freight rates charged by the Australian National Line shipping service to and from Tasmania was very well received. I think a tribute should be paid to the members of the Committee who so thoroughly examined this problem within the field of their terms of reference. I think they were able for the first time to give not only to the Senate but also to the people of Australia the proper emphasis to be placed on the great difficulties which Tasmania experiences as a result of its geographically insular position. Not only are we Tasmanians disadvantaged because of this insular position as related to the neighbouring continental mass with its alternative forms of transport such as very highly subsidised railways and highways systems and regular airway and seaway schedules, but also the lack of population in Tasmania adds to our problems. This in turn makes it essential that the great bulk of production which takes place in Tasmania on a primary and secondary level is without a readily available local market and must he exported either to the mainland or overseas. Wilh this in view the Committee has tried to come to grips with the problem with regard to the ANL activities and the introduction of new techniques in the way of roll-on roll-off vessels to provide a service which is satisfactory in terms of both regularity and costs. We have heard from Government senators and people outside this chamber that all blame for Tasmania's shipping problems is to be attached to the employees associated with that industry. In fact, the situation is typical of the economy as a whole: Inflation and increasing costs are making it impossible for many organisations to do business in Tasmania simply because of its isolation. These costs could be absorbed were there a ready local market - but there are not enough people resident in Tasmania to make the same adjustments to costs. Therefore the inflationary trend in the economy greatly affects those on the island.

The recommendations of the Committee covered a very wide field. I think most of the points that were made have been given very close consideration. The Minister spoke recently of an investigation into recent increases in both freight and passenger rate charges. He pointed out that if averaged across the board these adjustments in the freight schedule on the Tasmanian service apply to only a limited number of items and amount to an increase of only 1 per cent. The whole concept of a roll-on roll-off service, in my view, should have brought greater benefits to Tasmania in the way of reduced freight costs. After all, although a formula showed that nearly half the costs are on the land side - the costs incurred when a ship is lied up-


Senator Wright - What do you mean by the land side?


Senator O'BYRNE - The report includes a formula which shows that 50 per cent of costs are to be attributed to the land leg. It states:

Though there were some variations in the relative proportions quoted by witnesses, these depending to some extent on the nature of the goods and the size, shape and weight of packed units of cargo, the Committee believes it is reasonable to accept the following figures as a basis for consideration: Percentage of total charges - sea freight 40 to 45 per cent, wharfage 10 per cent, land leg charges 45 to 50 per cent.

Those percentages add up to 100 per cent. The report goes on:

It seemed to the Committee that the position of the Australian National Line had not been viewed in the proper perspective when Mie criticism arose following the shipping freight increase of 12£ per cent in August 1970. In the preceding 11 years, despite rising costs in the latter states, the freight rates charged by the Line had remained constant, with the qualification that there had been in 1961 a reduction of 15 per cent in the rates charged tor shipments from Tasmania to the mainland. Over the same period, freight forwarders' charges had been increased progressively by approximately 50 per cent.

So although the criticism that has been levelled at the Waterside Workers Federation and at other unions associated with this industry has been pretty sharp, the report shows that the freight forwarders' charges have increased progressively by approximately 50 per cent. Yet I have not heard one word of criticism from Senator Wright or from others who have been examining this situation of the effect of that increase on overall freight charges.


Senator Wright - To be fair, does not the report refer to an annual increase in wages costs to the ANL itself of $lm a year?


Senator O'BYRNE - As a matter of fact I have before me a document dated 17th August last in which the Minister for Shipping and Transport (Mr Nixon) points out that a review covering the period March to December last year showed that costs had increased by $1.8m. It reads:

Since increases were last applied in March 1971, there have been losses through strikes and increases in wages, maintenance, repairs, insurances, terminal charges and general overhead.

These increases in cost include the Tasmanian land end of the Line's operations as well as the mainland end.

After all, this is a shipping line which has very little at either end of its run because of the nature of its charter. The facilities for booking through private agents have been mentioned. My family is to sail from Tasmania tonight on the 'Empress of Australia'. Perhaps we have been favoured, because following a number of phone calls we were able, first, to get a standby on some chairs on board, and later, miraculously, we were able to secure a 4-berth cabin. But when we made our first inquiries we were told: 'No, there is a big line up'. As I see the pattern, the private agents like to take bookings from all over the country and to hold them as long as they can before they confirm them with the Line. As a result early bookings are put on the stand-by list and it is not until the last week or so before the ship sails, when the company has to run around all its agents to see whether they can have their bookings confirmed, that anything can be done about final bookings. This seems to me to be most uneconomical and unsatisfactory, and it has a very bad public relations effect.

A French sea captain visited me in Launceston, and I have never heard a Frenchman swear in English as fluently as he did because of all the trouble that he had going from the tourist bureau to the booking office - having the big runaround in Melbourne. He tried his very best to get any sort of accommodation on the 'Princess of Tasmania'. When he arrived on board the ship he found that there were 30 to 40 vacant berths. He was appalled to think that this could happen on what is not only a national line but also one of our few life lines cross the Strait. He wanted to come across by sea because he did not like air travel.


Senator Wright - Did the Committee make any comment on this matter to which you are now referring?


Senator O'BYRNE - The Committee commented on it, but I do not think its recommendations were forceful enough. It is my firm opinion that we have to take a wider view of transport generally throughout Australia. There is not a shadow of doubt that Trans-Australia Airlines is the most efficient organisation in Australia for achieving quick results when inquiries are made and for giving service. TAA leaves any other organisation for dead. It has an electronic system for registering bookings.


Senator Marriott - You would not try to book with Ansett, would you? I think that the people in Ansett are capable as well.


Senator O'BYRNE - I speak as I find it. The people in Ansett are very good. I must admit that Ansett is my second preference. I have no complaints about that airline. When I started travelling with TAA, Ansett was not in existence. There was Holymans and then there was the Australian National Airlines which became Ansett Transport Industries. I suppose Ansett has the same facilities as TAA. The point I am making is that if people book with TAA in Brisbane the booking staff can immediately receive advice from the central office. They know within seconds whether it is possible to make the booking. Why cannot the Australian National Line operate with this kind of technique, so that people who want to book with the Line can go to a TAA office or an Ansett office - preferably one only of the airline offices, and TAA has offices right throughout the Commonwealth. Instead of booking to travel by air they could book to travel by sea. The same process could be followed. They would know what the bookings were and what the availability of bookings was for 12 months ahead if neccessary. Not only would this give the general public greater respect for the Line and provide better public relations but it must result in more economies when all the berths are filled and there is maximum usage of the very expensive vessels.

The present difficulties arise from the costs of $1.8m that have been mentioned. This has been a cause of great concern to Tasmanians because they see no end to these spiralling costs. At the same time we find that our industries are suffering because every time there is an increase in freight our capacity to compete on the mainland is reduced and the incentive for people in Tasmania to produce goods is reduced because of the increased freight costs.


Senator Webster - Does not the Labor Party want to cut protection and put industries at the risk of losing everything to overseas companies? Is that not your policy?


Senator O'BYRNE - Is Senator Webster interested in the ANL or does he want a sort of Budget debate? I can elaborate on that perhaps during the Budget debate, I think he might be a better authority on old bomb motor cars than perhaps he is on Tasmanian shipping problems. The Minister in his statement of 17th August said:

Because of these cost increases, losses incurred in ANL's Tasmanian services and the high cost of providing passenger facilities, it became regretfully inevitable that some increases in charges must occur.

Of course, that is quite obvious, but the important point is the impact of these charges. It is all very well to isolate the Australian National Line and to say that unfortunately the increases have to occur, but there is a flow on from these increased charges right through the whole economy in Tasmania. Not only that, but when there is an increase in shipping freights, the forwarding people get their proportion and all along the line this reaction accumulates to the disadvantage of the Tasmanian people generally.

The Minister mentioned that fare and accompanied vehicle rate increases will bring in about an extra $150,000 annually and freight increases will bring in about $200,000. Of course, these increases apply to individual fares and cars. The cost of sending a car to Tasmania and bringing it back to the mainland has practically doubled.


Senator Wright - Which statement are you referring to? The recent one?


Senator O'BYRNE - Yes, the statement of 17th August.


Senator Marriott - That was the second increase since the Committee was set up. There have been 3 increases.


Senator O'BYRNE - This is the unfortunate thing.


Senator Marriott - A great advertisement for government enterprise.


Senator O'BYRNE - Perhaps we could take that view, but the other competing lines have not done any better. They certainly have not provided the same standard of service. I suppose the 'Empress of Australia' could be called one of the most modern roll-on roll-off vessels operating in the southern hemisphere. She has provided facilities that should really have considerably reduced freight costs but the advantage has been eaten up by these added charges.

The Minister said that further savings will come about through the recent rationalisation of the services plus increased efficiency. I am hoping to hear the Minister make some definite statement about the booking arrangements because I think the private side of the booking arrangements has let the Government down. I do not want to accuse the Union Steamship Co. of having any purpose to denigrate or to undermine the Australian National Line, but I do not think that the company is equipped properly to handle the bookings for this service. I am certain that when berths are allocated to the various booking offices throughout Australia those offices are not as interested as we are in making the Line a viable economic proposition. All they are interested in is getting their commission. If Joe Blow comes into a booking office and wants a berth or a chair on the Empress of Australia' that office would like to sell it to him, but if he does not come in to the office it will just send the allocation back to the shipping line at the latest possible time. That results in a loss to the company. I believe that if what the Minister has said about the recent rationalisation and increased efficiency means that this aspect is being considered, we will see quite an improvement in the situation and perhaps a longer period before the next freight increase.

I come finally to the point that the Minister made in his statement. He said:

On the matter of freight subsidy, the Government has looked at this proposal from time to time, but it has not been able to accept it. In addition the Senate Committee investigation frowned on "subsidy.

I do not know how we are going to overcome this matter because the old shipping line to Tasmania was subsidised. The Taroona', the 'Nairana' and the 'Loogana' were subsidised for carrying mail.


Senator Marriott - Over £1,000 a day, was it not?


Senator O'BYRNE - Yes, and perhaps it helped Tasmania to reach its present population and its present standard of production. We have all become tired of reiterating our complete dependence on shipping services for the bulk of our freight.

Sitting suspended from 12.45 to 2.15 p.m.


Senator O'BYRNE - When the sitting was suspended, I was drawing the attention of honourable senators to the peculiar and invidious position of Tasmania with regard to the freight problem which is the subject of the report now being considered by the Senate. The latest round of increases adds a burden which, in the eyes of Tasmanian people, brings the State to a crisis situation. People in local government and business are confused as to the economic future of Tasmania. The latest freight increases became effective on 14th August. An increase of almost 20 per cent took place in 5 categories of cargo. These freight increases followed freight increases of up to 50 per cent on vehicle and passenger services. The management of the Australian National Line explained the increases by saying that they were designed to eliminate anomalies in cargo rates.

Senator Marriottmentioned that the activities of the ANL illustrated the inbuilt inefficiency of government enterprises. Down through the years that I have known Senator Marriott I have been on committees with him and enjoyed his friendship. But this is where our philosophies part. It is my contention that many of these activities are public services in the same way as roads, electricity, water supply and telephone facilities are essential public services and are not areas for private enterprise. Private enterprise has operated in these fields in the United States of America, but many of them are failing now. The transport system of the United States, particularly the rail system, faces bankruptcy and, in more and more areas, the individual States are being forced to take up their public services.

Looking at private enterprise in Tasmania we see not only that it has been given a number of considerations and concessions but also that it has been a source of revenue to the Commonwealth. After all, Tasmania receives poor royalties in responsibilities to provide these facilities as respect of the first class quality timber it produces, which is mainly exported, and from its mineral resources. Tasmania has spent a great deal of its financial resources on the development of hydro-electric schemes to attract industries that use hydro-electric power. These industries include the aluminium industry and the paper pulp industry. Many of these industries disadvantage Tasmania because of the high level of pollution that they produce. Nevertheless these industries have made a contribution to Tasmania's economy. Yet such facilities as our shipping services are making it nearly impossible for Tasmania's economy to remain viable.

It has been pointed out that, in the recent Budget, the Commonwealth found no difficulty in allocating $54m for the Tarcoola-Alice Springs railway and $2. 5m for the sealing of the Eyre Highway. These are most important contributions by the Commonwealth towards the Australian transport system. We claim that not only an equal share should be given to Tasmania but more should be provided. (Quorum formed) I appreciate the concern of Senator Negus that my words of wisdom were falling on so few ears. Nevertheless, I know that there are times when honourable senators are busily engaged in their offices on electoral work. I fully understand how busy they are. I had pointed out that the Budget provides $54m for the rail system between Tarcoola and Alice Springs and $2. 5m for the sealing of the Eyre Highway. Yet, we cannot get the message across to the Government that similar sympathetic consideration should be given to the only method of transport available to Tasmania for its commercial products. These other areas to which assistance is being provided have alternative methods of transport and are not as isolated as Tasmania is.

The Commonwealth Government has power to provide assistance to Tasmania. I draw attention to the contribution that was made by the Deputy Leader of the Opposition in another place, Mr Barnard, when he was speaking on 1 7th August 1972. Dealing with the Australian Coastal Shipping Commission Act, the Deputy Leader of the Opposition referred to section 17, and stated:

It is worth looking closely at this section because its implications have been largely overlooked. The section empowers the Minister to direct the Commission to establish, maintain and operate shipping services to meet the requirements of a particular area where it is desirable in the public interest for such a service to be provided. Furthermore, the section stales clearly what can be done when such a service is established and it operates at a loss. If the service operates at a loss and in the same year the ANL records an overall loss, the line is entitled to be reimbursed by the Commonwealth. The amount of the reimbursement is defined as the amount of the loss of that particular shipping service or the overall loss of the ANL whichever is the less.

I   . also am at a loss to understand why the Committee did not deal with this point. I mention particularly Senator Rae who, unfortunately, is absent this afternoon. 1 am very sorry to hear the reasons why he is absent, lt is absolutely essential that the terms of this provision of the Act should be brought into effect with regard to the shipping line operating to Tasmania. This is a disguised form of subsidy, but provision is there. Yet, the Minister for Shipping and Transport (Mr Nixon) has said that this power has never been invoked and that no reimbursement has ever been made by the Commonwealth under that section. There is no time like the present for it to re-examine not only its responsibility towards Tasmania and the Australian National Line but the compensating gains that it would make by keeping Tasmania a viable, developing, healthy and economical part of this Commonwealth.

There has been a depression of mind and spirit in so many directions in our little island. Our mainstay for so many years has been our fruit industry - our apple and pear industry. Its activities have been well ventilated in the Australian Parliament over the past 72 years. The industry is in a very bad economic plight. This has been brought about by an alteration of the emphasis of our . markets, the accessibility to the European and British markets by South African competitors, as well as by shipping freights, coming back to the subject. The extra imposition on the Tasmanian people at this stage is such that the Commonwealth must provide some incentive for the people of Tasmania to find a way out.

Recently there was a change of government in Tasmania. It is possible that the Commonwealth Government might feel that it might get some political gain by making it more difficult for that State Government of a different political colour to overcome this problem. I say that because these issues often reflect more on State and local government than they do on the Commonwealth. I believe that the national Parliament and the national Government should approach this problem on a truly national level. Tasmania is the poorer sister of the family. There is no doubt about that. However, it is poorer only in the economic sense because Tasmania can match the other States in the other qualities of life. I am trying to emphasise the special need of Tasmania at this time of economic crisis when Tasmania's cost structure is influenced so strongly by freight charges incurred in transporting our goods to the mainland. The lifting of the confidence of our people needs immediate attention. 1 am taking advantage of the debate on this report apropos the Australian National Line and Tasmania's transport problems generally in the hope thai, in the councils of the Government, Tasmania will be given urgent consideration and whatever concessions can be granted to help out at the present time.

The Committee set out to do a job and did it very thoroughly. Members of the Committee did credit to themselves as individuals and to the idea of Senate select committee investigations. Its work represents another of those little segments of the mosaic in building up the prestige and usefulness of the Senate. I believe that the system of democratic government is enhanced by the presentation of these reports because they are then available for further research and for projections along the lines of the recommendations made by the various committees. We of the Opposition support the report and hope that some of the suggestions made during the course of the debate on it will be heeded by the Government and that this will be to Tasmania's advantage.







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