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Wednesday, 23 March 1966

Mr DUTHIE (Wilmot) .- The Australian National Line has become an indispensable facet of Australia's transportation system. In its 1 1 years of operation, the Australian National Line has built up a tremendous reputation in Australia and overseas for efficiency, growth, progress, usefulness and management. It is now a mature adult in the world of shipping. The Australian National Line has pioneered new forms of shipping transport, such as the roll-on-roll-off ships. It has stimulated shipbuilding in Australian shipyards. It has gathered together an outstanding staff in the fields of administration, management and construction.

The Australian National Line had an interesting birth. It was bom out of the Liberal Government's failure to sell the 40 Government owned ships after the Labour Government was defeated in December 1949. To the eternal disgrace of the Menzies Government in the early 1950's these Government ships were hawked around the world as the Government sought buyers for them.

Mr Freeth - That is not true.

Mr DUTHIE - It is true.

Mr Freeth - The Government did not sell them.

Mr DUTHIE - The Minister was not the Minister for Shipping and Transport at the time.

Mr Freeth - The Government insisted that the ships stay on the Australian coast. That was a condition, of sale.

Mr DUTHIE - Yes.

Mr Freeth - That is rather different from hawking them around the world for sale as the honorable member said.

Mr Pollard - But the Government tried to sell them. That is the issue.

Mr DUTHIE - Yes, the Government tried to sell the ships. The Government did not care who bought them even though they were to operate on the Australian coast. These ships could have been dispersed among overseas shipping companies because not a single company could afford to buy 40 ships even at the price the Government was asking for them. The Labour Party fought this move up hill and down dale for four years in this Parliament. Mr. Speaker, what a tragedy for our coastal shipping trade was averted when the Government failed to obtain the price that it wanted for these ships. This sellout, if it had taken place, would have set our coastal shipping trade back 10 to 15 years, in my opinion. These good ships would have been dispersed amongst half a dozen shipping companies which would have competed with each other. The Australian National Line has justified fully our confidence in its capacity to operate a huge coastal fleet and to meet competition along the way.

The Australian National Line through the years has been suffering under a grave handicap. This handicap can be likened to the ball and chain of the convict days. In the National Line's charter which was amended in 1964, the Government allowed the Commission to borrow only $10 million a year towards the capital expansion of its operations. This leaden restriction is to be removed under the provisions of the Bill now before the House. The ball and chain are to be taken from the Australian Coastal Shipping Commission. The Commission is to be given freedom to operate up to any level it wishes consistent with good financial practice. The borrowing straitjacket imposed on the Commission for so long was introduced when the original Act was framed most deliberately, in my humble opinion, by this Government in order to prevent the A.N.L. from growing up too fast and from coming to competitive maturity too soon. By competitive maturity I mean the capacity of the A.N.L. to compete with other shipping interests. This restriction on borrowing was imposed on the A.N.L. to keep it within a certain limit. In order to expand the Line needs capital. With its borrowings restricted to only $10 million a year, the expansion of this shipping line was certainly limited when we consider how costly ships are.

In my opinion, this borrowing restriction on the Commission has kept its development back, limited its expansion, and prevented vital shipping business from coming to our starved shipbuilding industry. The Australian Coastal Shipping Commission now wishes to expand its operations and its construction programme into various fields. The Commission has ordered, as my colleagues have said, a 47,500 dead weight tons bulk carrier which will concentrate on the transport of bulk ore. This carrier will soon be in service. The Commission has ordered also another 47,500 dead weight tons bulk carrier. It has ordered two roil-on roll-off cargo vessels for the Melbourne-Brisbane and the MelbourneBrisbaneNorth Queensland service. The Commission has announced" - I am very pleased with this decision - that it has under consideration a proposal to construct a second Bass Strait passenger vessel. We in Tasmania certainly hope that the Commission will decide definitely to build another " Princess of Tasmania ". This new ship should be bigger and include some definite improvements in relation to facilities that were not included in the " Princess of Tasmania ". Tasmania has been pressing for this second Bass Strait passenger vessel for some time because bookings on the " Princess of Tasmania " have to be made nearly 12 months ahead if passengers wish to take their cars over to the State. This fact has discouraged a number of people in their planning.

We feel there is enough freight and there are enough passengers also to warrant a second Bass Strait ferry. Now we are told that this matter has reached the consideration stage. We hope that, with the passing of this Bill, the Commission will be encouraged to go right ahead, decide the matter, and then plan and build this second Bass Strait passenger vessel. If the Commission decides to go ahead with this vessel, there will be a lot of happy people in Tasmania and on the mainland. Many people want to come to my State for a holiday. I could not recommend Tasmania for a holiday too highly. The Queensland area is very nice, but the climate is hot and Surfers Paradise is very expensive. People who have been there come back poorer men and women. The tourist will find a much better climate in Tasmania and it is not so expensive. People who want to visit Tasmania should come in February, March or April as these are the best months. If they want to see a green island they should come in October and November.

The Australian Coastal Shipping Commission has announced that it is to build a new specialised vessel for the Darwin trade. So, with this programme that I have outlined, no wonder this Bill is before us to remove the limitation on borrowing that has held back the Commission all these years. The Minister for Shipping and Transport in his second reading speech said -

The accepted commercial practice in thesematters is to achieve an appropriate balance between equity capital, overdraft and some form of loan finance. The Commission is required to pay a reasonable return on its capital and is expected to play a competitive role in its operations. In these circumstances it should have the same freedom to vary the ratio between loan borrowings and equity capital as its competitors, and the purpose of this Bill is to place it in this position.

After 11 years, the Commission is to be free from the limitation of borrowing that applied to it. But it has taken 11 years for the Government to remove this shackle or restriction from the Commission. The Minister says quite frankly that this move will give the Commission a better chance with its competitors. Honorable members can imagine what sort of a chance the Commission has had up to date with its competitors, bearing in mind the borrowing restrictions that have been placed upon it.

The Minister said further -

The approval of the Minister and the Treasurer will be necessary before any borrowings are made and this will provide a means of limiting or controlling the borrowings of the Commission in the light of its approved requirements for ships and terminal facilities if this proves to be necessary.

Therefore, the Government's shadow will still fall across the bows of the ships of the Commission because the Commission will not be able to borrow finance without permission and authority from the Government. 1 hope that the Government will be fair and reasonable when the Commission brings its borrowing programme before it; otherwise the purpose of this legislation will be lost. Indeed, the Commission will rely on the leniency, goodwill and decency of the Government to give it a fair go in its competition now that the restriction on its borrowing programme has been removed.

According to the Summary of the Australian Fleet, Table No. 1, supplied by the Minister, there were 113 ships as at 31st December 1965 operating around the Australian coast in our interstate fleet. Of these ships, 90 are Australian owned. More are Australian owned than I thought. However, 23 out of 113 are not Australian owned. Unfortunately the tendency for overseas shipping companies to butt into our Australian coastal trade is increasing rather than diminishing, lt is not a good sign, and I think it should be resisted by this Government. The Australian National Line is quite capable with the other shipping companies on the Australian coast of handling all our trade and, if it cannot, it must build the ships in order to do so. We do not want interference from overseas shipping companies on the Australian coast. 1 want to refer to a point or two raised in the 1965 report of the Australian Coastal Shipping Commission. It is an attractive annual report with coloured photographs, splendid graphs and, in all, is a model of a report to be submitted to any Parliament in any country. I am intrigued by the item headed " Chairman's Review " on page 4 which says -

The Commission has therefore called tenders for three large vehicle deck vessels and in so doing will extend the " container " principle of transport over a far wider field.

Then we have this sentence -

For this and other plans in hand or in view, additional finance, preferably by way of borrowings, will be necessary.

That is a very significant statement and is in keeping with what we have been trying to say in this debate, namely that the Commission needs freedom to implement this kind of programme. The only way it can implement it is to extend its borrowings. The Bill before us tonight should be a great blessing to the Line and will help the Commission to carry out the programme which I have just outlined.

It is interesting to note that at 30th June last year the Commission had a total of 39 ships. It had 19 bulk carriers with a total dead weight tonnage of 189,960, and an average age of 7 years 4 months. It had 1 grain carrier of 2,014 tons dead weight of the age of 7 years 10 months; 16 general cargo vessels totalling 54,059 tons of an average age of 14 years and 3 vehicle deck vessels of 5,468 tons of an average age of 3 years 5 months, making a total of 39 ships of a total dead weight tonnage of 251,501. That is a wonderful record of capital equipment in ships. The personnel of the Line numbered 2,076. What the Line is doing for the economy of Australia is something to be wondered at. This Bill will give the Line what might be regarded as a blood transfusion. The building of ships in our shipyards will mean a distribution of wealth, finance, money, purchasing power, or whatever you like to call it, throughout Australia. We are proud of the Australian National Line, and I am sure that anybody who comes into contact with the work it is doing is also proud of it.

The Commission has now been given the green light to go into overseas trading should it want to do so. I understand that its charter gives it the power to do so. The Minister gave me that information in answer to a question I asked this year in the House. This development is long overdue. The Minister for Trade and Industry (Mr. McEwen) - the Leader of the Country Party, the Deputy Prime Minister - made a statement in Tasmania last year, the most significant that he has made for a long time, at a Country Party conference, I think, in which he said that he expected to put a bold plan to the Federal Cabinet soon to give Australia an overseas shipping line. The newspaper in which his statement was reported commented -

It is understood his plan is for a conference of private Australian companies to operate a fleet of bulk cargo carriers overseas.

That is his scheme. He wants to ask these shipping companies - Broken Hill Pty. Co. Ltd., Howard Smith Ltd., Bulk Ships Pty. Ltd., Adelaide Steamship Co. Ltd. and R. W. Miller Holdings Ltd. - to get together and help finance or build ships for an overseas service. This is something different from the Australian National Line doing it. I only hope that either plan will be put into effect, or perhaps a combination of both, because we have to get into the overseas field. We are the only trading nation that does not own a fleet of overseas ships. The Australian National Line, with its charter and the know how to do this, and with the shipbuilding yards in Australia, could build the necessary vessels, or with finance made available to it, hire or charter them. It could start off with a few ships and gradually build up to 15 or 20 within the next 15 or 20 years. That is what I hope will happen.

I desire to make a few points on this aspect. Our major primary industries rely on overseas markets. Our major secondary industries rely on overseas sources for raw materials and heavy capital equipment. We are so much further than most competitive countries from the main importing markets and our life blood is shipping, in this continent tucked away down here in the South Pacific. In 1961-62 only 0.6 per cent., or one ton in every 150 tons of goods entering Australia, and only 1.5 per cent, of goods shipped from Australia, were carried in Australian registered vessels. On the best statistics available it has been reliably estimated that the total freight charged by overseas shipowners to carry our exports and imports in 1962-63 was £430 million.

Mr Freeth - The honorable member is getting a bit overseas in relation to the Bill.

Mr DUTHIE - I have not said as much about overseas shipping as some of the Minister's colleagues did.

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