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Tuesday, 29 November 1983
Page: 3020

Mr O'KEEFE(10.53) —Grain farmers in various areas of Australia are greatly concerned at the 15 per cent tariff on all imported grain harvesters which was recommended by the Industries Assistance Commission in its recent inquiry. The IAC inquiry was made pursuant to a referral from the then Minister for Administrative Services, the honourable member for Bass (Mr Newman), who called for an inquiry and report on whether there should be any changes in the form of assistance provided to the producers of grain harvesters in Australia. Submissions to the inquiry by the National Farmers Federation and the Livestock and Grain Producers Association favoured assistance from tariff to bounty and recommended that if assistance was needed for the manufacture of local grain harvesters it should be provided by means of a bounty. The IAC found against this evidence and made a recommendation to the Minister for a tariff duty of 15 per cent on all grain harvesters imported.

The Minister for Industry and Commerce (Senator Button) endorsed these findings and, of course, since this decision farmers across Australia have voiced through NFF and LGPA considerable opposition to such action. Petitions against this decision bearing the names of thousands of farmers have been presented to this Parliament by me in the past few weeks, expressing bitter disappointment and concern. The use of the tariff as a form of assistance for the local manufacturers of grain harvesters is highlighted by the declining market share of locally made machines and the inability of local manufacturers to produce large capacity machines of advanced design to satisfy the majority of the grain industry's harvesting requirements. Tariffs or quota assistance would increase the cost of an essential and major input to all grain growers. Profitability of the grain industry-one of Australia's most efficient low-cost industries-would be reduced, as would the ability of Australia to compete on the world's grain market, where over 70 per cent of its grain production is sold. Thus a tariff or quota would contribute to a less efficient industry structure, leading to low farm and national income, and a reduction in employment numbers.

By contrast, because a bounty would not increase the cost of an essential major input, and because local manufacturers of grain harvesters would have to compete against imports in terms of price, quality and performance of their products, a bounty would contribute to a more efficient use and allocation of Australia's resources. The bounty for the local manufacturer of grain harvesters should be structured in such a way that it does not discriminate on the grounds of local content or machine size. Many independent farmers have also approached me requesting a bounty instead of a tariff recommended by the IAC. Representations have been made to the Minister requesting that, as there are other flaws in the IAC report, he investigate the situation and find in favour of the grain producer's stand.