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Friday, 30 October 1964

Senator O'BYRNE (Tasmania) .- This Bill has for its purpose the amendment of the Australian Coastal Shipping Commission Act. The main amendments relate to the borrowing powers which are contained in section 30 of the Act. The Minister for Defence (Senator Paltridge) referred in his second reading speech to the substantial capital expenditure which the Australian Coastal Shipping Commission faces over the next few years for the construction of new vessels which it has on order or intends to build, and for associated shore facilities. Under the Act, the borrowing power of the Commission is limited to £5 million. It is on this point that we on this side of the Senate present our main opposition to the Bill. In other respects we support it. It appears that the limit of £5 million unnecessarily inhibits and circumscribes the scope and the initiative of the Commission. In view of all the circumstances and of the activities of the Commission, the Government could well have made provision for a higher limit than £5 million. It is the intention of the Opposition to move at the Committee stage that the amount of £5 million be increased to £10 million.

It is interesting to note that the Minister stated that the proposed new section of the Act is in the same terms as section 31 of the Australian National Airlines Act 1945- 1961, which controls the operations of the Australian National Airlines Commission. To discuss a topical subject, during the recent festivities associated with the welcome extended to the Boeing 727 aircraft when they arrived in Australia, the managing director of Ansett Transport Industries Ltd. remarked, amongst other things, that this indicated the expansion of airlines and of the need for finance. He pointed out that while the total cost of taking over Australian National Airways Pty. Ltd. had been £3i million, that was the cost of only one new Boeing 727. That comparison illustrated how aircraft costs have increased over the years. The same comment may be made, of course, in regard to shipbuilding costs.

No debate on a matter such as this should be allowed to pass without reference to the splendid achievements of the Australian National Line. Those achievements are a source of great pride to mc personally and reflect tremendous credit on the Chairman, the Vice-Chairman, the Commissioners, and especially Mr. Mercovich, the General Manager. The Commission's report which has been presented to this Parliament is studded with references to wonderful achievements. As a representative of Tasmania, I can say that the Australian National Line is one of Tasmania's greatest friends and allies. Since its advent, not only has it revolutionised our maritime services, but also it has given the people of Tasmania a standard of service which they had never previously enjoyed. The regularity, the reliability and the high standard of the services are appreciated very much by the people of Tasmania.

The Australian National Line has gone into competition with other shipping lines on the fairest of terms and has shown its ability to compete at every level. Perhaps, in the circumstances, there could be reservations concerning the terms, because restrictions have been imposed on the A.N.L. The inhibiting and circumscribing of the line so as to prevent it from performing the duties which I believe the people of Australia, and particularly the people of Tasmania, would like to see it perform, is a matter on which I want to develop my argument. During the last year we have had considerable controversy in Tasmania relating to the This matter bears on the competition provided for the Australian National Line by the Union Steamship Co. of New Zealand Ltd, which is operating the " Seaway King "

Union Line was able to obtain promises - whether or not they were in the form of contracts, I do not know - that it would bc able to go into Hobart. Yet, strong pressure was being exerted on the Australian National Line to direct all its services to Hobart, against competition which had had the advantage of being organised before the " Empress of Australia " began to operate. At the time of the controversy I was asked what I thought would be the future schedules of the " Empress, of Australia ". I felt quite certain in my mind that the matter would be dealt with efficiently and fairly by the members of the Commission. As things have' turned out this year, the people of Tasmania are quite happy with the arrangement.

Under the Act as it is framed at present, the Commission is limited to borrowing for temporary purposes on overdraft with a maximum of £5 million. The Bill seeks to extend the sources from which funds may be obtained. Under the new proposals, the Commission will be able, subject to the necessary approval, to borrow money other than by bank overdraft, and also to borrow from the Treasurer out of moneys appropriated by the Parliament for the purpose. The very attractive report of the Commission for 1964 shows the liabilities of the A.N.L. They are: Bank overdraft £1,876,187, accounts payable, £885,666, accrued charges £557,458, provision for income tax £1,250, 000, and proposed dividend £985,507, a total of £5,554,818. It seems absolutely ridiculous that specific arrangements should be made for limiting the overdraft or borrowing capacity of the Line to £5 million when the report shows that there are current liabilities of more than £5i million.

The figures disclosed in the annual report are well worth quoting. During 1963 the Line carried coastal cargo amounting to 7,139,134 tons, compared with 6,046,040 tons in 1963 - an increase of 1,090,000 tons. Overseas cargo carried in 1963 amounted to 5,250 tons and was nil in 1964. I will have something to say about that later. lt is interesting to note that in 1963 the Line carried 90,968 passengers and in 1964 90,837 passengers. These figures show that it is working to its maximum carrying capacity as far as passengers are concerned.

The difference in the numbers carried in the two years is only a little more than 100. This indicates the popularity of the services provided, the regularity of the schedules, and the general attraction that the Line has for both business people and tourists. Its popularity has been sustained. In 1964, the Line made a profit before tax, of £2,265,847, compared with £2,089,932 in the previous year. This represents a gain. The Line pays income tax to the Commonwealth. For some reason or other, this Government believes that it must impose income tax on its own instrumentalities. It does so in the case of the Australian National Line, notwithstanding that the whole purpose of the Line is to try to hold freight rates so that shipping costs which become part of the costs of production of industry can be kept as low as possible. The Line has to borrow money and pay interest on the money it borrows. This imposes a considerable burden. It could borrow, perhaps, from the Commonwealth at favorable rates; but on the other hand, in an emergency it might have to go on the open market and pay high rates of interest. The Line paid £1,230,436 in income tax in 1963,-1964, but despite that it showed a net profit, after tax, of £1,035,411. The percentage of net profit to capital, after paying income tax, was 6.3 per cent, in 1964, compared with 8.2 per cent, in 1963.

The assets of the Line comprise ships, land, buildings, plant and equipment. Between 1963 and 1964 the value of the ships increased from £29,932,545 to £32,444,755 and the value of land and buildings increased from £658,548 to £1,148,868. During the past year the Line purchased eight acres of land at Mort Bay in Sydney on which to construct a passenger and cargo terminal.

Sitting suspended from 12.45 to 2.15 p.m.

Senator O'BYRNE - When the sitting was suspended I was reviewing the activities of the Australian Coastal Shipping Commission over the past year. In January 1964, the Commission launched the " Empress of Australia " and on 9th June it launched the "Musgrave Range" at the Whyalla shipyards. On 5th October 1963 the Commission launched the " Jeparit " at Brisbane and the vessel was commissioned on 4th February 1964. It has ordered two additional vehicle deck ships, one for the Melbourne-Brisbane trade and the other to operate between Melbourne and Sydney. The Commission has also conducted negotiations with a view to placing an order for a bulk carrier of 47,000 tons dead weight. The excellent report of the Commission for 1963-64 shows that the Australian National Line is being operated to the limit of the powers granted to the Commission by the Government and we have high hopes for its future.

I mentioned earlier that the Commission had purchased eight acres of land at Mort Bay, Sydney, and had let a contract for the construction of a passenger and cargo terminal on the site. On the figures available to me, I calculate that a considerable investment is represented by that land. In view of the bright future of the Australian National Line, there is a golden opportunity for the Government and the Commission to increase that investment by purchasing further areas of land in the immediate vicinity of the Mort Bay site. If the opportunity is not grasped now, it might never occur again. I understand that an area about twice the size of the land already bought by the Australian Coastal Shipping Commission is available for purchase now.

I strongly recommend that every consideration be given to the purchase of the land because there is no shadow of doubt that the Australian National Line has been established on such firm foundations that the Commission and its assets have become an invaluable part of our commercial and defence complex. This is more apparent in view of factors operating throughout Australia and, indeed, the world today. A reliable and well equipped shipping line is just as important to our defence system as it is to our trade and economy. The Australian National Line has a most promising future despite the administration of this Government. I foresee more progressive governments and I would not like to see inefficiency and circumscription of the Commission's activities because of lack of foresight.

I hope that the Minister for Defence, in his reply, will express some opinions on the feasibility of my suggestion that more land be acquired at Mort Bay. It can be accepted that this will be the headquarters of the Australian National Line. The anticipated expansion of the Line's activities in the coming year will take it into trading areas of Queensland that it did not service previously. The report of the Commission directs attention to the entry of the Australian National Line into the southern ports - North Queensland service. That alone illustrates my point that because of its character, this Line will be called upon to provide an essential coastal shipping service. I have seen no mention in the report, except in a negative way, of any expansion into the overseas shipping trade. In 1963, cargo carried overseas totalled 5,250 tons but there is no record of any overseas cargo having been carried in 1964. lt has been pointed out often that we must look to a situation in which we will have to protect and preserve our overseas trade balances in a keenly competitive world. We have to protect our economy in every way possible, and one way to do this most effectively is the transport of our evergrowing volume of exports. That need is related to my point of view that the basic facilities should be provided at the headquarters in Sydney for such an expansion of the Commission's activities.

Senator Kendall - The honorable senator will have to get the Seamen's Union to grow up first.

Senator O'BYRNE - I feel that the Australian National Line, inspired by its objectives, can offer a new era in employeremployee relationships in that respect. By comparison, I believe, the Commission will show the conference lines and other lines run by private enterprise how to overcome the problems of employee-employer relationships by a proper approach. I have every confidence that that will be the experience.

I have already mentioned the importance of the Australian National Line to Tasmania. The " Bass Trader " which plies regularly between the mainland and Bell Bay, has become part of the everyday life of northern Tasmania. People in northern Tasmania who export to and import from the mainland have only words of praise for the service rendered by the "Bass Traders " That statement applies also to the " Princess of Tasmania". The heavy demand for bookings on this ship continues. I think that that one point should be cleared up. I refer to the distribution of quotas to the various booking agencies. I gather that a lot of people make tentative bookings a long way in advance and when the bookings are co-ordinated, it is discovered that there are cross bookings which, because of the duplication, create vacancies that could have been used by people who genuinely wanted to travel at a time when heavy bookings caused them to abandon their intention. I suppose it is a matter of management and checking. It is an area that should be investigated to see that the people who are given such generous and elastic concessions by the Line do their utmost to ensure that the maximum use is made of every berth and other accommodation facilities on both the " Princess of Tasmania " and the "Empress of Australia". In his review, the Chairman said -

For the past six years, Australian National Lino freight rates have been held, or reduced in certain trades, an achievement made possible, inter alia, by the efforts of the management and the staff afloat and ashore; by virtue of the additional revenue forthcoming from new tonnage paid for out of reserves and the full employment of the fleet, to which 1 have referred. This year, £3 million has been invested in the " Empress of Australia ", " Musgrave Range " and the " Jeparit "; and the terminals and other facilities to serve the needs of the fleet.

Upon the advent of the last two mentioned ships-

He referred to the " Musgrave Range " and the " Jeparit " - together with the " Empress of Australia ", the Australian National Line will operate roll-on rolloff services embracing Brisbane, Sydney, Melbourne, Hobart, Launceston (Bell Bay), Devonport and Burnie. The " Empress " will also re-establish a passenger link between Sydney and Hobart after a lapse of 24 years.

The Hobart to Sydney service will certainly fill a long felt want. Another competitor has already entered the field, perhaps because of the stimulus provided by the A.N.L. Tasmania will gain from the services provided and 1 feel certain that there will be sufficient business to make these ventures profitable.

The advent of the roll-on roll-off ships has a tremendous impact on the Waterside Workers Federation. The number of waterside workers employed in Hobart has fallen to about half of its previous strength. The possibilities are that there will be a further reduction. The legislation which has already been introduced in this Parliament to provide for retirement benefits for waterside workers has made possible the implementation of a plan to see that the replacement of personnel on the waterfront has not been kept at a level as high as previously, so that the numbers have been reduced. Nevertheless, the new methods of loading and unloading have had. a very big impact on the port of Hobart where the salaries and wages received by the people who were regularly employed on the normal handling of Cargo have been drastically reduced. In many cases the services of waterside workers have been dispensed with.

I have quoted widely from the annual report from 1964 of the Australian National Line because I have wished to make the point that the great constructive factors within the policy of the A.N.L. should be given every encouragement by this Parliament. The figures for the' operations of the Line show that it could compete with any other business organisation, and even excel in its activities. I commenced my speech by offering my congratulations to the Chairman, the Vice-Chairman and the Commissioners, and also to Mr. Mercovich, the General Manager, for being able to carry on this splendid organisation in a manner that brings credit to themselves and can attract only praise from the people of Australia.

Apart from the reservation that the Opposition would prefer to see the amount of £10 million substituted for the. amount of £5 million,, so that the fullest possible scope for the activities of the Australian National Line may be created, the Opposition supports the measure.

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