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Wednesday, 19 April 1972
Page: 1243

Senator HANNAN (Victoria) - Mr Acting Deputy President,we have just witnessed a most extraordinary exhibition. Senator Bishop, to whomI ascribe the virtue of sincerity, a man interested in the welfare of an Australian industry, has put forward a motion related to the Australian aircraft industry. Before my friend Senator Mulvihill resumed his seat only 4 of his colleagues were prepared to listen to his important motion. (Honourable senators opposite interjecting) -

The ACTING DEPUTYPRESIDENT (Senator Lawrie) - Order!

Senator HANNAN - I did' not put the motion down. I do not know why it happens that so frequently when I have pearls to place before this chamber I am interrupted by honourable senators opposite. Senator Bishop has adverted to a very serious and important question in our industrial life and in our defence life. To that, extent I give him credit. Unfortunately I cannot go along with Senator Bishop in the words and the attitudes that he expressed.

Senator Poyser - That surprises us.

Senator HANNAN - Can I have a fair go? I was very quiet when you were speaking.

The ACTING DEPUTY PRESIDENT - Order! There is far too much conversation in the chamber. The honourable senator will be heard in silence. I call Senator Hannan.

Senator HANNAN - I am indeed grateful to you, Mr Acting Deputy President, for your protection, which apparently I need so badly.

Senator O'Byrne - You are only a filler inner.

Senator HANNAN - Wait until I am finished with you to see whether or not I am a filler inner. I want to refer firstly, before getting around to some of the nonsense which has emanated from the official Opposition, to the 2 difficult matters to which my friend Senator McManus referred but which I could not understand. The point which Senator McManus made in regard to Project N could be valid if the Royal Australian Air Force and the Army had completed their evaluations of this extremely important project. But in truth and in fact, as the honourable senator must know, that evaluation has not yet been done. Approximately 99 per cent of the production from the Government Aircraft Factories, the Commonwealth Aircraft Corporation Pty Ltd and the Hawker Siddeley company is in respect of military aircraft. Unless the Defence forces have a requirement for Project N and unless we have very many overseas purchasers rushing in, wanting to put their dollars down and saying, 'Look, we will have a dozen or a couple of dozen of these aircraft', it would be the height of folly to become involved in a project of this kind.

The other matter to which my friend adverted, perhaps casually, was the fact that we were not producing helicopters. As you will know, Mr Acting Deputy President, we are producing - admittedly it is over a period of time - 75 light helicopters for the Army and 116 helicopters for civilian use. This is not peanuts in an industry which produces this highly complex and most valuable equipment. As I said before, almost the entire output from the Government Aircraft Factories, the Commonwealth Aircraft Corporation and the Hawker Siddeley company are military aircraft. This is what puzzles me. These aircraft are needed for defence purpose. One does not need to be Mandrake to know that the Australian Labor Party has no defence policy. That being the case, how on earth can it show any interest in the production of aircraft from CAC, GAF or Hawker Siddeley for defence? To find the answer we do not have to look further than the events which occurred last weekend at the Victorian State Council of the ALP and its appalling decision on Vietnam. We do not have to go beyond the treachery of that decision to know how little interest the official opposition has in defence, foreign affairs and our relations with our great and powerful friends. That being the case, I find it a little difficult to understand why-

Senator Cavanagh - 1 rise to a point of order. I am concerned about the question of relevancy which is essential in the debate and whether what the Labor Party did last week has anything to do with aircraft production in Australia.

The ACTING DEPUTY PRESIDENT - Order! There is no substance in the point of order.

Senator HANNAN - It is not difficult to understand the sensitivity of my friend Senator Cavanagh in relation to these matters which indicate quite clearly that the Australian Labor Party is not interested in defence and is not interested in foreign affairs.

The ACTING DEPUTY PRESIDENT - Senator Hannan, I suggest you keep your remarks a little closer to the motion before the Senate.

Opposition senators - Hear! hear!

Senator HANNAN - 1 am glad to hear the cheers which indicate that my honourable friends opposite so value your protection, Mr Acting Deputy President.

Senator Georges - You should talk about the subject under discussion.

Senator HANNAN - You will have to do better than that. That is childish. For the past 35, almost 40, years the aircraft industry in Australia has revolved around and been economically dependant upon orders from the Royal Australian Air Force. The entire industry seems to revolve around the large factories - Government Aircraft Factories, Commonwealth Aircraft Corporation - which are situated in the predominant manufacturing area of Australia, namely, Melbourne, Victoria, around which the whole nation seems to revolve in an industrial sense, and the minor production is done in Sydney by the Hawker Siddeley company. When these 3 large contractors are put together, along with the 10 or 15 other parts contractors, we find that we have the nucleus of a small, viable, highly developed aircraft industry. That being the case, it is not surprising that of the 1,300 aircraft recently purchased by the RAAF 1,000 were manufactured in Australia. If this is neglecting an industry, I think words have lost their meaning. It is not possible to take seriously the criticism in that regard. In addition the decision was made recently - it was not quite so recently - to build Macchi all-through jet trainers. It has been necessary to buy the relatively small number of aircraft which have been purchased abroad because of the type of aircraft involved. We did not have an adequate run of production to set up jigs, assembly and manufacture in this country. Does any honourable senator opposite suggest that we should have got involved in the manufacture of Mysteres or BAC Ills or aircraft of that type?

In the financial year 1970-71 the RAAF spent 74 per cent of its budget on Australian production. In addition to the money spent with major contractors we have a vast number, almost 200, minor suppliers of bits and pieces and so forth who have contributed their share towards the maintenance of the Australian aircraft industry. There is one particularly interesting policy which has been adopted by the

Royal Australian Air Force under the present enlightened administration of the Minister for Air (Senator DrakeBrockman) and that is this: If it is necessary to buy aircraft or components abroad on one particular occasion, at a later date if that order has to be repeated a search and check is carried out first to see whether the aircraft or equipment is available in Australia. Australian firms are given the opportunity of fulfilling the order before the matter is finalised overseas.

Another relatively small aspect when one considers the capital cost of aircraft is the Government's policy on offset orders. When the Government has ordered aircraft abroad, as it has done from the Boeing organisation, it has arranged for offset orders to be placed for portions of the aircraft. These are set off against the total debit for the purchase. In Australia we manufacture rudders, elevators and in spar ribs for Boeing 727 aircraft. You will be interested to know, Mr Acting Deputy President, that Australia now is the sole source of supply for rudders, elevators and in spar ribs for Boeing 727 aircraft. There are other examples of offset orders which I could give. The United Aircraft Corporation of America already has placed orders in Australia worth $165,000 and is currently negotiating further contracts for aero-engine components. I am not going to be foolish and say that this is the greatest industrial feat of the 20th century but it does mean that the aircraft industry in Australia is receiving sustenance as a result of the Government's policy. In the long term it means also that because of the close involvement of our manufacturers with overseas manufacturers, which have all the technological assets which the American and French nations, for example, can provide, our industries increasingly are drawn into the main stream of world development.

The Australian aircraft industry has developed a number of firsts. I want initially to refer to what I regard as one of the more outstanding successes of Australian designers and aero-engineers. I refer to the Jindivik pilotless target aircraft. As you would appreciate, Mr Acting Deputy President, it is not very pleasant to fly an aircraft with a drogue trailing at the real and to have people firing anti-aricraft shells at the drogue. That being the case the people at our range in South Australia developed the Jindivik. This is a pilotless jet aircraft which tows a target drogue. It has been so successful that the American Government has placed orders for it. I recall seeing a sound film made by the American Department of the Navy before the Jindivik was sold. It was a great triumph for Australian scientists, engineers and manufacturers to compete successfully with American defence manufacturers, having in mind that, by congressional order, overseas orders are not placed for defence equipment unless it is absolutely necessary.

The ACTING DEPUTY PRESIDENT - Order! The hor Durable senator's time has expired.

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