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Tuesday, 15 March 1966

Mr PETTITT (Hume) .- The first thing I must refute is the statement by the previous speaker, the honorable member for Dawson (Dr. Patterson) with reference to the former honorable member for Dawson who was a leading world authority on sugar matters and who spoke in an informed way in this House on many occasions on matters pertaining to the sugar industry. Too often we find a man with academic knowledge only standing up to speak in this House as an expert on rural affairs. Mr. Shaw, not many months before he died, told the story in this House of what this Government has done in the north.

Mr. Shawtold of the tremendous development talcing place and of the tremendous amount of money that is being spent in that atea. The present member for Dawson said that he would tell us how we could develop the north. He said he would tell us where we could get the money. He did not do so. He is like many economists who have these flights of fancy which have no foundation in fact. Too many of us who have made our way in the world the hard way and who have reached where we are today because of our own efforts would have been in the bankruptcy court if we had listened to the economists. I think today of many young men who have gone into the northern area now afflicted by drought and who have developed properties on the advice of Government agronomists and economists. Today many of them are in the greatest difficulty, not because the advice they were given was not sound but because, very often, they did not have knowledge of the local conditions they would have to face. But, mainly they are in trouble because they struck a two year drought which was unheard of in that area.

The honorable member for Dawson said many things with which I agree. He also said many things that we have been saying on this side of the House for years. Obviously he is already uncomfortable on the Opposition side of the House. I felt that this would be so long before he stood as a can didate for the Dawson by-election. One of my friends said to the honorable member for Dawson: " How can you reconcile yourself with the views put forward by a socialist party? " The honorable member will not be able to attain the things he seeks to attain from the Opposition side of the House because honorable members opposite have no sympathy for those ideas. It was not very long ago that the Deputy Leader of the Opposition (Mr. Whitlam), when speaking in Sydney said that far too much money was being spent in country areas. He said that the people of Australia were suburban dwellers and that that was where the money ought to be spent first. He said that far too much money was being spent in country areas. That indicates the overall policy of the Opposition. Today we see this Government passing legislation which is in the interests of the people who created the wealth of this country. We heard in the speech of the Prime Minister (Mr. Harold Holt) what he proposed to do to provide rural finance. This is something for which the Australian Country Party claims a great deal of credit. What our drought committee did in introducing deputations to the former Prime Minister and the present Prime Minister, who was then the Treasurer, is well known. Practically everything that our committee proposed has now been accepted by the present Prime Minister. I pay him a tribute for seeing the necessity for developing our rural industries. I also pay a tribute to our own Country Party Ministers who fought hard for many months in order to get our policy on rural finance adopted.

I do not think many people in this House or outside it realise what the proposal for rural finance really means to this country. Our rural industries are still responsible for earning the great bulk - about 88 per cent. - of our export income. That includes a small amount earned by the export of minerals; but it is earned principally by our rural industries. The very lifeblood of this country is our export earnings from rural production. It is absolutely vital to the future development of the country that these industries be supported and given the ability to develop and expand, wherever they are.

The first need is water. This is one point on which I agree with the honorable member for Dawson. Water is perhaps the most vital commodity in Australia. This Government has done a great deal and is doing a great deal more to exploit our water resources and to expand the conservation and reticulation of water. Very much remains to be done. We are a nation of only 11 million people trying to develop a vast continent. There just is not enough money or manpower to do everything. Without water it is futile to try to develop a vast continent such as Australia.

Although much has been done and is being done in this field, the honorable member for Dawson gave no credit to the Government for its tremendous efforts. He advocated the spending of many millions of dollars on northern Australia. But he did not tell us from where he would get the money. Does he intend to increase taxation greatly, or would he reduce the present expenditures on other items, such as defence, social services, telephones, the development of country areas in the south or the reticulation of water in the south? These things are desperately needed in our southern areas where we have lost the great bulk of our stock. It is not in the far north but in the more developed areas that we have lost vast numbers of the stock that are our main export earners. This is where we have to spend the money.

The Prime Minister's present proposal for the provision of rural finance will enable the individual, who is always the most effective in national development, to provide for drought himself. I have always maintained that it is very much better to give a man a taxation concession than to give him a subsidy. Subsidies tend to encourage the inefficient man, the man who does not try to help himself. But taxation concessions encourage the man who has the ability, the drive and the knowhow to go ahead and make his own provision to counter the effects of drought. The proposal is to inject quite a lot of money into the community and we have to be very careful about how this is done, lt would be very easy to force stock prices up to uneconomic levels. That is something that has to be worked out.

Anybody who has had anything to do with the development of a property knows that the provision of long term finance is absolutely imperative. Under former banking arrangements, primary producers were expected to repay their loans within a very limited number of years. My experience, and the experience of many other people who have developed properties, is that a person developing a property needs an increasing amount of money. As he sows down the land he needs fencing, water supplies which are the most costly item of all, fodder and plant to enable him to store continent. There just is not enough money he must be retaining his surplus stock. So, unless he has long term finance the venture becomes futile. But the ultimate result pays handsomely.

A particularly pleasing feature for rural producers is the indication that these long term rural loans will be available through our own trading banks. Many primary producers, land owners and other people have had long associations with the private banks. Some families have banked with the same institution for three or four generations. They do not want to be forced to go to a government bank for finance, as has been the case so often in the past. We believe that the present proposal is a major breakthrough. The Prime Minister has told us that under his proposal provision will be made for us to obtain this finance through our own private trading banks.

This new type of finance will not interfere in any way with the present overdraft arrangements which are so necessary for producers who need carry on, short term finance while they are waiting for the proceeds of the sale of their produce. That finance is necessary and has always been available. It is the long term finance that will mean so much to this country. It will allow many men who are keen to go out and develop properties to do something worthwhile and practical. Another feature of the Prime Minister's proposal is the suggested setting up of a rural loans insurance corporation along the lines, I take it, of the Housing Loans Insurance Corporation.

I do not need to tell honorable members how difficult it is today to get a start on the land. I started almost from scratch. In those days it was a good deal easier than it is today, although it may not have been as easy then as it was in my father's day, when a man with a good reputation and knowhow could get a cheque book and go ahead. It is becoming more and more difficult to get a start. A great amount of finance or financial backing is necessary before any young man can set himself up as a primary producer. Thousands of young men in Australia - not only the sons of farmers and graziers, but also the sons of professional men and young men who have gone through our agricultural colleges - are breaking their necks to get a start on the land and are finding it almost impossible to do so. I believe that this scheme of insuring bank loans to progressive young men with ability, drive, knowhow and all the other requisites except sufficient finance, will have a tremendous effect in increasing our production and our export income. I do not think anything would have a greater effect on development than enabling young men to go out and take up land that needs to be developed and so to increase the prosperity of the whole community.

The Prime Minister's proposal also indicates acceptance of an obvious fact that we have been pressing for many years, namely that a great deal more capital is necessary for the development of land today because of the increase in scientific knowledge and the research that has been done by the Commonwealth Scientific and Industrial Research Organisation and other institutions. We know that we can increase our production, that we can grow more pastures, that we can conserve fodder and can provide adequate water supplies but far too often we just have not the wherewithal to do these things. That applies particularly to the young and vigorous man. The provision of long term finance will allow such a man to help himself and so help the whole community.

Now I turn to drought. This subject is referred to only briefly in the plan put forward by the present Prima Minister because the former Prime Minister had already made it very clear to the States, particularly New South Wales and Queensland which are suffering the ravages of drought, that the Federal Government was prepared to back those States in any expenditure that they made on drought relief.

Mr England - To back them unconditionally.

Mr PETTITT - Yes, unconditionally, with unlimited assistance for the people who, unfortunately, through no fault of their own, are suffering the ravages of drought. This assistance will go on. It will not be affected by the special long term finance. This money is available now and is doing a tremendous job. I agree that this provision was much too slow in coming into operation but, unfortunately, governments move slowly. Unfortunately, the State Governments were slow in getting off the mark after the former Prime Minister gave the undertaking, and it had to be reiterated by him over and over again before we got the States to move and do something worth while, but they are doing it today and a tremendous job is being done.

I believe that it is utterly ridiculous in this day and age that we should accept as a fact that we must lose vast numbers of breeding stock in any drought, at least in New South Wales. This is not necessary and should not have to be accepted at all. If there is one lesson that we must learn from this drought it is that we can do something to save the stock. Very often it does not pay an individual to save his stock, although he feeds to the limit of the value of the stock, to the limit of his resources, or to the limit of his borrowing ability. But the nation suffers very, very seriously not only from the loss of the stock but also from the loss of the progeny - the natural increase - and the income that it would produce over a number of years.

I believe that there should be proper planning. Here again, I feel that this is a national problem. The retention of, perhaps, one-third of our wheat crop at the point of production until the next crop is in sight would do more than anything else to make sure that we never suffer these losses again. Wheat is an excellent food for both sheep and cattle. The Commonwealth Scientific and Industrial Research Organisation has proved in tests that wheat will save sheep and cattle. There is no doubt that it is a better food for sheep but it will save cattle in a difficult situation. I believe that, in the national interest, we must save stock. It is much better, certainly, if we can help the individual so that he is in a position to do so. We should give tax concessions to encourage the enterprising man to protect his own stock in his own interests. The retention of a portion of the wheat crop would not only help us to save our stock but also would give us something in kitty to supply our customers in a vear when we did not have such a big wheat crop. If we are not able to supply the overseas customers that we have for our wheat we shall lose those markets. If we had a stockpile, it would be there as a drought reserve and it would be there to meet our customers' requirements. It could be stored cheaply, it could be moved cheaply, and it could be cashed when the drought broke.

We hear many people - mostly ignorant and uninformed people - talking about the improvidence of farmers. It costs a tremendous amount of money to preserve large quantities of fodder - grain or hay - and provide storage for it. Very few farmers can afford this, particularly in the safer areas of high value land. Very few farmers can afford to leave fodder standing in a shed in a corner for, perhaps, five, six or seven years, waiting for a drought. The hay deteriorates. The grain is standing there, not earning all that it might earn. If we stockpiled wheat to be made available as fodder, if we gave some tax concessions and, perhaps, allowed farmers to invest with the Government certain sums in good years, to be tax free if they used the money for drought feeding, we would be encouraging enterprising men and preventing tremendous losses.

At the present moment we have a drought on our hands. Many millions of sheep and hundreds of thousands of cattle have been lost, and we have to do something about getting people back into production. It is not an easy task; it is one that we have to handle very carefully. We can do a tremendous lot of damage if we make finance available ad lib, but we must ensure that the deserving and progressive man has assistance to get back into production. Right along the line, no primary producer who is worth his salt is asking for charity. He never has done so. Some people do that, but those who are worth their salt - the great majority - do not. They want time. That is all that they ask for. They want long term finance. I believe that the average primary producer is not looking for excessively low interest rates. He wants to pay reasonable interest. The term is much more important than the interest that is payable.

Now that we are in this position, with this very worthwhile proposal that has been made by the Prime Minister, now that we have the experience of the drought behind us and now that we have the opportunity to make this country develop, to make it move, let us all put our shoulders to the wheel. I am sure that we will then prove that this move by this new Government - it is a new Government - will do much to create employment and prosperity and ensure the future of this country.

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