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Tuesday, 18 April 1961

Mr WHEELER (MITCHELL, NEW SOUTH WALES) - There you are; the honorable member re-affirms it.

There cannot be any doubt whatever of what will happen in the future to insurance companies under a socialist government, because here we have a re-avowal of the socialistic doctrine of nationalization. I think I will leave it at that, because it has been openly stated and openly re-affirmed. We on this side of the House, naturally enough, are opposed to any form of nationalization or socialization of industry.

Mr Bryant - Why?

Mr WHEELER - Because of the wide difference between a sound Liberal outlook and the morbid outlook of the socialists. Having looked at honorable gentlemen opposite and at the enlightened countenances on this side of the House, I can see the difference between straight-out honest to goodness Liberalism and the morbid doctrine practised on the other side.

In introducing the measure, the Minister for Trade (Mr. McEwen) said that the Government was anxious to encourage Australian exports and to strengthen the export earning capacity of our primary and secondary industries. The bill is one of the measures designed to help to this end. It is also designed to encourage or to act as an inducement for Australian industries to develop overseas trade. This is a commendable move and should be supported, but to break into the export market at present is not an easy matter. The honorable member for Mackellar has pointed out the difficulties confronting the high-cost producing country and the advantage that the low-cost producer naturally enjoys. Consequently, the range of manufactured goods must necessarily be low.

International trade now is living in a crazy world in which a very big proportion of all exports can be classed actually, if not legally, as dumped - that is, sold at prices which have been artificially lowered. This is done either by selling below the home price or by giving a government subsidy by tax remissions or some other device. We in Australia seem to have little alternative but to join in this crazy race. The truth is that a lot of nations have introduced subsidies on exports in an attempt to sell abroad goods that cannot be sold at home because they are too dear. They cannot beat the imported goods on their home market; yet they hope to beat them overseas. What they really do is to export at a loss, a loss disguised either as a subsidy or a tax remission.

The Australian manufacturer, aside from high costs, has another obstacle which I shall refer to as the second tariff. There are tariffs on imported goods, but our very high Australian taxes are in effect a tariff on local goods. This gives the imported article an advantage in many instances. It was laughable to read recently that the interstate executive of the Australian Labour Party held the view that taxes on high incomes in

Australia were lower than those abroad. The Australian Labour Party no doubt hopes to finance its give-away election programme by higher taxes on big incomes, but it is just trying to fool the public.

Most secondary production in Australia comes from public companies. They pay a company tax of 8s. in the £1 on any profit they distribute to shareholders. A further personal income tax is levied. For high incomes, the combined effect of the two taxes is higher than those levied overseas. In other countries, as a rule, only one tax is levied. With our high taxes and high costs, our local manufacturers are being elbowed out of the Australian market. By giving them some tax relief and some other types of Government assistance, it may be possible for them to sell more in overseas markets, but this will be selling at a loss in many instances from the national point of view. By all means let us use every effort to increase our exports, but our best efforts, I am afraid, will leave us short unless we can do something about the flood of imports. It benefits nobody but the shipping companies if each country pays out subsidies to sell its goods abroad at a loss when they could be sold on the home market if the price was right. Some time ago, the Government took one of the most courageous and genuine steps any country has taken towards establishing freer national trade. It virtually abolished import restrictions. But there is no denying that this drastic action has created many problems in the local economy. The Government has announced that its policy is to deal with economic problems as they occur. In other words its economic policies are flexible, as they verily should be, and it has not hesitated to change a policy when circumstances have so dictated. I sincerely hope it will not be inflexible or rigid on this matter of import controls because import controls are the key to many of our problems.

Undoubtedly, the sweeping away of controls has done some good, lt has helped to keep our prices in check, and that was the principal object in abolishing controls. But there are still many things being imported which do not really affect our price or cost structure at all. I refer, for instance, to the wide range of /luxury imported foodstuffs and wines 'to be seen in many of our shops. If they were missing and the buyers had to turn to local productions, it would have no effect, for instance, on the basic wage.

Another argument for free imports ii that they keep local industry on its toes, that they force it to maintain efficiency. But very frequently these luxury imports are no better than the Australian manufactured goods. They sell merely on snob appeal. There is a class of people who are prejudiced against Australian-made goods and who buy imported goods as a matter of principle, no matter what the quality. I submit that, by restricting the importation of these luxury items, we would save a great deal of our precious foreign exchange without any compensating disadvantage to us. That is the first step to be taken in the battle to restore our overseas reserves, and there are other steps which we must take.

I cannot help feeling that, although there has been a slight favorable turn in the overseas trade position lately, there may be worse to come. For instance, Britain is under strong pressure to join the European Common Market. If she does, it will mean the end of the preferences we enjoy in Britain. Although the preferences we grant to British goods are very much bigger than the ones Britain grants us, what seems to be coming out of the discussions going on in Britain at present, is the proposal that she should try to sell us the idea of foregoing our preferences in the British market while still granting Britain her preferences in this market. That, I believe, would be a disastrous step. Whatever comes of the European Common Market negotiations, it seems clear that, on the balance, the European Common Market has worsened our position in trade with Europe.

The position is so complex that I should like to see Parliament debate many other questions relating to overseas trade quite apart from those now under discussion. Because of that, I do grudge the long time given recently to debating the African question. That long debate was forced by a move from the Labour Party which seems to be most anxious to distract attention from Australian affairs at the present time. The Labour Party has just come through a period of policy window dressing in preparation for the next elections, and the goods it offers are so obviously designed to deceive rather than to serve that apparently it does not want them examined minutely. The Australian Labour Party has no answer to our local economic problems. Its members would much prefer to talk about Africa, about China or anywhere else in the world than discuss conditions on the home front. For my part, I support wholeheartedly the Government's efforts to boost exports but I am even more anxious to hear from the Government some proposal on the other side of the ledger - some proposal relating to imports, for I feel that balance will be achieved only by a substantial reduction there.

Question resolved in the affirmative.

Bill read a second time.

In committee:

Clauses 1 to 4 - by leave - taken together, and agreed to.

Clause 5 (Contracts in national interest).

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