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Wednesday, 15 May 1957

Mr HAROLD HOLT (HIGGINS, VICTORIA) (Minister for Labour and National Service) . - I move -

That the bill be now read a second time.

This bill is short, and its purpose is plain. It increases the stevedoring industry charge from1s. 7d. to 2s. a man-hour. As honorable members will be aware from earlier legislation relating to the charge, it finances the operations of what is now the Australian Stevedoring Industry Authority. The operations of the authority go very much further than its own administrative activities. It attends to the payment of attendance money, -and it makes, in effect on behalf of all employers in the stevedoring industry, payments on account of sick leave and statutory holidays. That is not the complete range of its activities, but those are some of them.

The charge is a levy on man-hours worked, and is additional to the hourly working rate of pay awarded by the Commonwealth Conciliation and Arbitration Commission to waterside workers. It is paid by the employers in the industry, and is received by the Australian Stevedoring Industry Authority to form a fund covering a number of purposes, including those I have mentioned. The charge was increased in October last, principally to meet the 50 per cent, increase in the attendance money rate and the payments on account of sick leave and statutory holidays, which had just previously been awarded by Mr. Justice Ashburner, of the Commonwealth Arbitration Court, as it then was. There were also additional costs flowing, for example, from the extension of the press and radio system of allocating labour.

The rate of charge which had operated prior to October had been found insufficient to sustain the authority's working funds, and these had, for some time, been running down at a rapid rate. The action taken in October was considered necessary to arrest this trend and restore the funds to a safe level for future operations. It should be made clear that the authority's revenue varies according to the number of man-hours actually worked. The effect on the authority's finances of a decrease in man-hours worked operates adversely in two directions because, first, its revenue decreases, and, secondly, unemployment increases with a consequential increase in the number of attendance money payments.

It had become evident in January, that the October increase was not likely to produce the desired improvement in the authority's finances, and pending a determination of whether the financial position would be held or would deteriorate, arrangements were made with the authority's bank, the Commonwealth Trading Bank, for temporary accommodation, while .trends in the industry could be further studied. This review has been made, and has disclosed a further deterioration in the authority's finances. The rate of ls. 7d. was fixed in October on the best estimate that could be made at that time of the manhours likely to be worked in 1956-57. It was then thought that 36,500,000 hours would be so worked. It now appears that the figure will be nearer 34,000,000, which is 2,500,000 man-hours below the estimate, and I think it is important to carry in mind that it is 4,500,000 below the hours actually worked in 1955-56. So it will be seen that we estimated, knowing that there was a reduced level of imports, that the figure would be some 2,000,000 hours less than it had been in the previous year. In the result, it is working out at about 4,500,000 hours below the 1955-56 figure.

The principal reasons can be briefly stated. First, the volume of imports has been lower than anticipated, and the easing of import restrictions has not so far resulted in increased cargoes. Goods to a value of £823,000,000 were imported in 1955-56. The figure for this year is likely to be of the order of £700,000,000, which is £120,000,000 less than the figure for the previous year, and the Government has planned on a permitted level of imports to a value of £775,000,000 in 1957-58. This increase in imports is expected to influence the volume of tonnage handled throughout ports from June onwards. The Suez crisis has also had some influence on the rate at which imports have arrived.

Secondly, as I mentioned in the House recently, there has been a progressive decline in the tonnage of general cargoes handled by our interstate shipping. I do not need to go into the reasons for that at this stage. Bulk cargoes have not lost ground in the same way, but it is general cargo that requires the larger labour force. In 1956, the tonnage of general cargo carried interstate declined by more than 20 per cent, in comparison with that of the previous year.

A third factor which has affected the authority's finances, and which is rather an unusual one, I imagine, is the unusually dry weather in many ports. This has meant, overall, a significant reduction in the time lost due to rain, and, although there has been no great effect from this on the total manhours worked, there have been more men on attendance money.

Fourthly - and this is a happier note - there has been a welcome improvement in stevedoring performance. The increase in sling loads and the smaller gangs which have resulted from Mr. Justice Ashburner's award are bearing fruit. Palletization of cargoes and mechanization of handling arrangements, including extension of bulk loading facilities are also making a contribution.

All these factors have meant a smaller number of hours worked and while, in regard to the latter category mentioned, they have been a reflection of improved efficiency, they have contributed to increased attendance money payments and reduced revenue for the authority. The fewer man-hours worked have had two effects on the authority's finances. Its income in 1956-57 is expected to be £200,000 less than was estimated. On the other hand, its expenditure on attendance money is expected to be approximately £600,000 more. So that, overall, on these two items, the authority will find itself, at the close of this year, about £800,000 worse off than was expected.

Looking to the future, some increase in the volume of stevedoring work can be expected in 1957-58. This will require a smaller labour force to handle the same tonnage than would have been the case, say, twelve months ago. Assuming this improvement continues in the longer term, stevedoring operations may require a smaller work force than the current level. This is receiving the close attention of the authority, and port quotas are being reduced as the occasion demands. Recruitment has been suspended, and the labour forces are being reduced by wastage. However, more immediately, the levy has to be adjusted because the current trend in the authority's finances cannot be allowed to continue.

The Government has no intention of increasing the levy more than is needed. It may transpire that what we are providing here is not adequate but, on the estimates that we have been able to make, it should be adequate. However, it is abundantly clear that the new levy must be adequate to enable the authority to meetits current commitments, including increases flowing from the recent basic wage rise; to pay off the overdraft it has incurred; and thereafter to build up some modest reserves against the inevitable and constantly recurring fluctuations in the volume of business in this industry. An increase of 5d., it is believed, should enable that.

Honorable members are aware of the efforts which the Government is making to reduce costs, including transport costs, which represent such a relatively high proportion of our total. I am hopeful that this increase of 5d. will not have to remain for very long, and that in roughly a year's time, when the authority's overdraft should have been discharged, it will be possible to reduce the levy. The improved waterfront performance should enable shipowners to absorb all or most of the increased charge.

I have had some discussions with my colleague, the Minister for Shipping and Transport (Senator Paltridge), and through him have made some inquiries of the Australian Coastal Shipping Commission. It would appear that the operations of that body have been in recent times sufficiently satisfactory and have been influenced, to some degree, by an improved waterfront performance. This should enable it to absorb the recent 10s. increase in the basic wage and also the 5d. addition to the stevedoring charge. In all probability it may not be necessary to increase the freight charges of the commission. I hope that the same experience will result from the survey which the interstate shipowners will be making of their operations. I know that they have commented publicly on the improved performance. I think it was Mr. Parker, of Huddart Parker Limited, who made some reference to it. It is, perhaps, not unconnected with the good performance of coastal shipping in northern Queensland that there has been a reduction of £1 a ton in freight for cargoes transported southwards from the northern ports.

Given reasonable prospects of a continued improvement in waterfront performance I should hope to see not merely an absorption by shipowners of this charge, but also, as the charge becomes reduced - as I most certainly hope it will be in the near future - corresponding steps taken by them in the direction of a reduction in their shipping freights. I commend the bill to the House.

Debate (on motion by Mr. Ward) adjourned.

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