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Thursday, 4 June 1970

Dr PATTERSON (Dawson) - Mr Speaker,the Wheat Industry Stabilisation Bill 1970 is intended to amend the parent Wheat Industry Stabilisation Act in 2 major respects. The first is in relation to quotas which are a form of restriction on wheat production in Australia. The second is to give discretionary authority to the Australian Wheat Board to sell in Australia wheat for purposes other than human consumption at prices lower than the price for human consumption - in other words, lower than the price set within the terms of the stabilisation scheme itself for wheat for home consumption.

As is well known now, a record production of wheat has occurred in Australia. This has caused very serious problems regarding not only storages for that wheat but also the disposal of it. It has been necessary for the wheat industry to restrict production or to accept a lower price for its products. The wheat industry has agreed to reduce production voluntarily by a form of quotas - this being the responsibility of the States - and the Commonwealth has agreed to pay the same first advance payment of $1.10 per bushel. The State governments have accepted the proposal to reduce production.

The Bill before the House will enable the Australian Wheat Board to operate on a quota pool basis. In the 1969-70 season, for example, wheat delivered within a grower's quota will become part of the quota pool. Wheat delivered in excess of his quota will be received as over quota wheat. It will not be taken in the 1969-70 pool unless, and to the extent that, it is sold and paid for in full during the season.

With respect to the prices, as outlined in this Bill which amends the principal Act, the change proposed again is the result of further recommendations by the Australian Wheatgrowers Federation. The Wheat Industry Stabilisation Act. 1968 provides for a home consumption price to apply to all domestic sales of wheal whether as stock feed, for products for human consumption or for industrial use. In September of last year, as the Minister for Primary Industry (Mr Anthony) points out in his second reading speech, the Federation asked for some amending provisions to be introduced with respect to the price of wheat in Australia. The complementary legislation was altered to give the Australian Wheat Board discretionary authority to sell wheat for slock feed and for industrial uses at a price below the going home consumption price of $1.71 per bushel for f.a.q. wheat in bulk f.o.r. ports but not less than the equivalent of the guaranteed price which for that season was ยง1.45 per bushel for f.a.q. wheat f.o.b.

On 22nd May 1969 I suggested proposals designed to allow surplus wheat to be sold for stock feed in Australia at prices below the high domestic price then operating. That price was $1.71 per bushel. I made the point that owners of starving stock in Australia were discriminated against blatantly because they were forced to pay a price based on $1.7) per bushel while, at the same time, the Australian Government, through the Australian Wheat Board, was selling wheat to overseas countries, including China, at prices well below the domestic price. On the one hand, for example, owners of starving stock in western Queensland were required to pay the domestic price based on $1.71 per bushel while, on the other hand, wheat of the same quality was being sold to overseas markets at $ 1 .45 per bushel. In some cases, the price could be less.

When this proposal, based on a No. I pool and a No. 2 pool system for wheat apart from wheat for human consumption, was suggested to the Parliament, the Government said that it could not be clone, that such a proposal if adopted would wreck the whole wheat stabilisation scheme, lt could not be considered. It was said in fact that it would wreck the very solid foundations on which the whole of the wheat stabilisation scheme had been built. This appeared to be the official view of the Government. Now, the Government has performed a somersault. It has changed its mind. This has been known for some lime. Legislation complementary to this Bill has been introduced in all State parliaments wilh the exception, 1 believe, of Queensland. I am not certain whether complementary legislation has been introduced into the Queensland Parliament yet because serious drought has affected quota levels.

We see that, in this Bill, the Government has introduced what was suggested here a long time ago. 1 think that this is a good system. Naturally, the Opposition is supporting it. The only basic difference between, us is on the subject of price. The only basic difference between the Government's view on this wheat for stock feed or industrial use and the altitude adopted by the Opposition is that we believe that the Australian Wheat Board should be given flexibility regarding the price at which the wheat is sold, even if that price is below the guaranteed price. 1 will be moving an amendment during the Committee stage to give effect lo that attitude.

In many instances, in times of severe drought, if stocks of wheat are built up it may be good economics to sell that wheat at a price below SI. 45 per bushel. Certainly it is recognised thai this could have a serious effect on the coarse grains market in some periods. As a person who is in favour of stabilistaion und orderly marketing in all major industries, I think the time will come before very long when the coarse grains industry, as far as exports are concerned, will have to be stabilised in terms of controlled marketing in the same way as stabilisation has taken place in relation to practically every major produce industry which has been in trouble. We are seeing this happening today even perhaps in relation to the dairying industry. The need for flexibility is recognised. Prices on the coarse grains market could drop. This fact is recognised by me. However, in the long term, it would be most advantageous to have a flexible price for what is called unsaleable wheat, rather than to permit it to be stored indefinitely, and then to try to solve the problems of the ancillary effects on the coarse grains market in some areas.

I propose to move an amendment to the motion for the second reading of the Bill. This amendment is identical to the amendment which 1 moved at the time when the legislation establishing the wheat stabilisation scheme was before the Parliament. I argued here that only I price should be agreed upon. Thai is to say, ] argued that we should not have a price of SI. 7 1 per bushel for all wheat sold domestically and a price of Si. 45 per bushel for wheat that was exported. This was a radical change in the whole system of wheat stabilisation since the inception of the scheme. The burden of additional costs has been borne by the low income earner - that is, the family which eats bread and eggs - instead of the Australian taxpayer making up any difference that is needed out of Consolidated Revenue. I move:

That all words after 'Thai' be omitted with a view to inserting the following words in place thereof: the Bill bc withdrawn and redrafted to provide for a one-price scheme for home consumption and export wheat, being a price which will return to the grower $1.48 f.o.r. per bushel which is equivalent to a guaranteed price of $1,511 f.o.b. per bushel for exports up to a maximum of 200 million bushels from the crop of any season, to apply from the commencement of the current stabilisation scheme'.

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