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Conservatives limber up for a fight over trade protection



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W BM t LIBERAL News Release

Federal Secretariat: P.O. Box E13. Queen Victoria Terrace. ACT. 2600 Tel.: (062) 73 2564

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Conservatives limber up for a fight over trade protection By D A V ID O'REILLY THE passage of a seemingly insignificant piece of federal legislation last week

represents a turning point in the historic shift underway in the trade and industry policies of Australia’s conservative political parties.

W hat appeared on the sur­ face to be routine support by the Federal Opposition for a relatively unimportant com­ mercial Bill, is being portrayed as the end of an era in the ap­ proach of both the Liberal and National parties to industry protection.

At a joint Liberal-NP meet­ ing some weeks ago, it was re­ solved that the Bill extending bounty assistance to an Al- bury company, Battenfeid, should be supported.

But the decision was made in the face of a quiet revolt by an axis of Liberal Party “dries” and economic rationalists and

an important new cell of Na­ tional Party MPs who entered Parliament at the last election and who privately exult in the

phrase that has sprung up to describe them — “the new­ wave Nationals". ·â– 

The role of this small NP cell of youngish, university- educated economic rational­ ists is significant because it is attempting gradually to cut· links with the agrarian social­ ism that for so many years dominated the Country Par­ ty’s approach to trade and industry policy.

Last week, this axis of MPs served notice that, while they would allow through the ex­ tended assistance to the A1-

bury company, the days of automatic parliamentary sup­ port for such moves were over. From now, they are deter­

mined to breathe life into their political rhetoric about deregulation and the disman­ tling of protection by refusing to automatically allow assist­ ance-extending legislation through the Parliament. ,

Instead they will examine each Bill and decide, case by case, if other factors outweigh the importance of hammering the deregulation line.

Battenfeid is the only com­ pany left in Australia produc­ ing injection-moulding machines for the manufacture

of plastic goods and parts. The machines have been subject of seven IAC reports in the past

decade. Local production has been receiving relatively high, though gradually diminishing, assistance for many years.

Phased bounties have been used since 1979 to protect the company as other local firms went out of business. While in­ itially the bounties were intent ded to be temporary, the legis­ lation extends them at an ad­

ditional cost of $2 million to the taxpayer. Leading the charge was en­

ergetic David Connolly,- the NSW MP who Andrew

Peacock gave responsibility for drawing together the Lib­ erals’ deregulation policy be­ fore the December election.

Mr Connolly told Parliament the Opposition was not oppos­ ing the bounty extension be­ cause it would be unfair to the

company to change policy at such short notice. But he

warned the Government it had better start translating its rhetoric about industry ra­ tionalisation into action.

For a company which now produced 30 machines, com­ pared with 103 in 1979 the Government was subsidising each of its 68 workers by

$25,000 a year. It was another case of suc­ cessive IAC inquiries extend­ ing support year after year,

and featherbedding jobs as — industries or companies grad­ ually collapsed without any rationalisation.

Importantly. Mr Connolly was given support in the de­ bate by Dr David Watson, Mr Alexander Downer, Dr Harry Edwards and Mr Peter White

from the Liberal Party and Mr Michael Cobb, and Tim Fis­ cher from the National Party. Other MPs said to be support­ ing the policy shift, in some

degree, but who did not speak include Mr Peter Slipper, from the Nationals and the Liber-, als’ Mr Julian Beale and Mr Warwick Smith.

These MPs make the point

that the type of assistance ex- ! tended for Battenfeid is . in I fact costing the economy, financially and in jobs. They .

said it was "becoming accepted th at for every job saved by featherbedding, the money '

could be used to create three jobs elsewhere. "The industries which owe their employment to protect­

ion or assistance do so a t the i expense of employment in other industries,” Mr Connolly said.

The shift in the Opposition’s approach does not have major, short-term moment for parlia­ mentary politics. What it does reflect is th at the National

Party traditionalists are losing the battle and a new breed of activists are determined to •signal to both the business j

community and the unions they are intent on implement-, ing a new philosophy for in­

dustry restructuring and de­ regulation rather than just talking about it. Soon a government Bill will

come before the Parliament to prop up the ailing Snowy

Mountains Engineering Cor­ poration by expanding its abil­ ity to compete in the market. The joint party meeting in

Canberra last Tuesday voted that this Bill, which once

would have been likewise regarded as routine and un­ -exceptional, will now be opposed.

The MPs who inherit the leg­ acy of “Black Jack" McEwen have finally decided th at dif­ ferent economic conditions

from those of the 1950s and 60s now require different answers. ·

New-wave Nationals pledge critical scrutiny