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Thursday, 20 May 1965

Senator WEBSTER (Victoria) . - The Bill before the Senate is to grant financial assistance to the States in connection with the price of certain petroleum products. It seeks to bring about a more equitable cost structure for petroleum fuels throughout Australia. The intention is that the price per gallon should be no more than 4d. above the main city prices and that the whole of the benefit should go to the eventual purchaser of the fuel. This policy was stated by the Prime Minister (Sir Robert Menzies) in his policy speech in 1963. I certainly fully endorse the Bill. I compliment, as did former speakers, the Minister for National Development (Mr. Fairbairn) who, 1 understand, played a leading part in the preparation of the Bill, and the Minister for Customs and Excise (Senator Anderson), whose Department will have to implement the measure. The Bill will provide financial assistance to the States so that they may be able to make payment to distributors of eligible petroleum products. Payments to the States will be made under section 96 of the Constitution.

The Bill has some interesting features. First, the Minister is to be given power to formulate a scheme and he is to be given power to amend this scheme. I compliment the Minister upon the very comprehensive document that we have been given in explanation of this proposal. Under the scheme, distributors are to be registered. To become registered distributors, they must enter into an agreement with the Commonwealth. They must give an assurance that the purchaser will be given the benefit of the subsidy and that they will not claim unless they have given the purchaser the benefit of the subsidy. There are provisions in the Bill which give reason to believe that good safeguards will exist. The States will make payments to distributors of amounts ascertained in accordance with the scheme. Clause 5 (5.) (a) states that the scheme shall provide for payment by the State to registered distributors, in respect of the sale by them at places to which the scheme applies of any eligible petroleum products, of amounts ascertained in accordance with the Scheme, but the following paragraph states that the scheme may provide for payment by the State to registered distributors in respect of their own use of eligible petroleum products and expenses incurred by them in connection with this scheme. In one instance it is stated that the scheme shall provide; in the other it is stated that the scheme may provide. Perhaps that position could be made a little clearer.

The Bill prescribes how amendments may be made to the scheme. If the Minister is satisfied that an eligible petroleum product was on 30th June 1964 sold at a place specified in the schedule and by reason of curcumstances existing on 31st December 1964 it is desirable to vary the rate of payment, the schedule may be amended. He may amend the schedule by omitting the name of a place, if a new site is selected for distribution. I take it from another provision that if a distributor moves under the wing of another State, an amendment of the schedule may be made. The Minister may amend the schedule to substitute for the rates of payment in the schedule rates in the currency provided for by the Currency Act. 1963. I take it that that relates to decimal currency. We have the benefit of knowing that the schedule will be published in the Gazette.

Information will be furnished by the States. One safeguard is that application has to be made to the Commonwealth by the Stales on a form approved by the Treasurer. We shall have the protection afforded by the certificate of the Auditor-General of the Stale that payments have been made in accordance with the scheme. Only on provision of that certificate will payments be made. An indemnity will be paid by the Commonwealth to the State if any legal action arises, as a result of which compensation must be paid. 1 welcome the Bill. We in the Country Party have for many years worried about high costs in the outback. Here in one stroke the Government is removing a crushing burden of transport costs in the country. We who are closely connected with all country matters realise that there has been something of a cost and price squeeze going on in country areas for many years. The national policy of growth and continued expansion, population growth, full employment in country areas, and manufacturing development, have inevitably put pressures on costs. It is the farmer who feels this type of squeeze particularly. We all know that the farmer has lifted his efficiency greatly in past years and has boosted his output dramatically with a lower work force. What is not generally known is that despite this performance, in the years since 1952-53 in real terms, net farm income has fallen by nearly 2 per cent. On the other hand the average incomes of male wage and salary earners have risen by some 30 per cent. In some measure this shows how the farmer's relative income position has deteriorated.

There is need for the Commonwealth to adopt compensatory policies. Unlike other units in the economy, the farmer, exposed to export in the cold world, cannot pass on increasing costs. Not only has he to battle against upward cost pressures at home but also his problems are aggravated by unremunerative prices in overseas markets, shrinking access to markets, and even competition from heavily subsidised farm products from moderately wealthy industrialised nations. So, rightly, at a time such as this he turns to the Government for some assistance. Some adjustment must be made to ensure an equitable position for the primary producer in the economy. National policies must include compensating measures to sustain the strength of agriculture on an expanding basis. But equity is not the only ground. The balance of the economy in the Commonwealth is involved. The stability of the economy depends on the export earnings of primary industry to pay for the things that represent ambitions of growth.

This is the broad thinking of the Government which underlies the Bill. This is a continuation of the policy that has yielded the superphosphate bounty, beef road schemes in Queensland, research and extension services, tax concessions, irrigation, rail standardisation, and protection of the overseas operations of primary producers. The proposition in relation to the price of petrol is another example of the application of policies designed to assist not only the farming community but also industrial communities which aire removed from city areas. They are designed also to bring some amenity to rural dwellers.

There is a great personal factor in this Bill. We want a strong, prosperous and happy country community. We want to make life in rural areas attractive. This raises all kinds of personal considerations which, as I have mentioned, the Government has endeavoured to meet in a host of practical ways. The Government is always endeavouring to bring amenities to country areas. Senator Drake-Brockman mentioned that nearly 90 per cent, of the Australian community now has television available to it. Let us consider the activities of the Post Office. The number of rural automatic exchanges has increased from 169 to 1,784. In 1949 only one in ten country subscribers were provided with automatic exchanges. Now one in two have them.

A good deal of the funds allocated to the States finds its way into avenues of development in country areas, such as in the construction of schools, the carrying out of shire and municipal works and the provision of various amenities. Perhaps even "more importantly, we are striving to reduce the added costs of family life in the country. In country areas good roads are essential not only for increased production but also for good living conditions and for the provision of reasonable amenities for families. The Government makes it mandatory for at least 40 per cent, of its allocation to the States for roads to be spent on rural roads. We now have twice as many miles of sealed roads as we had in 1949. The Bill now before us will reduce the price of petrol in rural areas - a practical and constructive contribution towards reducing the personal cost of transport and towards reducing the added cost of life in the country where nearly every family owns a car and using a car is part of family life.

We have here a concrete measure designed to reduce the added cost of production in the country. Senator Kennelly suggested that the Bill was designed with the objective of gaining increased taxation because the farming community would receive an increased income. The honorable senator may have that thought in mind. I believe that there are other vitally important things about this Bill. It will provide assistance not only to primary industries but, as I have said, to rural manufacturing industries as well. We must keep in mind that our great exporting industries need assistance.

The Bill could be of considerable value in the field of tourism. The reduction in the price of petrol will reduce the cost of travel and will induce people to travel further to see some of the extreme areas of our great Commonwealth. One of the important features of the Bill is the subsidy on aviation fuel. I think this shows great vision because there is an ever increasing use of light aircraft in country areas. The Government's action will tend to reduce costs in the light aircraft industry and for the people who own and use light aircraft.

In some respects the schedule is rather difficult to follow and I should like to direct the Minister's attention to it. The distribution points in Tasmania are listed on only one sheet, those in Western Australia on 17 sheets, in South Australia on 7 sheets, in Queensland on 21 sheets and in Victoria on 15 sheets. I mention those States because we have said that the centres listed are those which we will declare to be approved for receipt of the subsidy. For some reason which the Minister may explain the list for New South Wales and the Australian Capital Territory covers 89 pages.

Senator Anderson - They are the existing points of distribution.

Senator WEBSTER - This is rather difficult to follow. For instance, every place which is a distribution point for petrol is also apparently a distribution point for aviation gasoline. That is difficult to imagine, because I should think that aviation gasoline would be distributed from the airport. I cannot think that aviation gasoline is taken in 44 gallon drums to all of the places in New South Wales and the Australian Capital Territory listed in the 89 pages.

Senator O'Byrne - Nearly every station property has its own airstrip.

Senator WEBSTER - If there are so many such places in New South Wales and the Australian Capital Territory that they fill 89 pages, I congratulate those two areas. I point out also that although high subsidies are paid in certain areas for motor spirit, power kerosene and auto distillate, there are instances in which no subsidy is paid for aviation gasoline. In that circumstance I take it that the aviation gasoline is obtained at what I might call the home base and is sufficient for the forward and return journey.

I see the reverse position which is hard to imagine. A place like Weipa mission will gain a reduction of 28£d. on aviation fuel and gasoline but the suggestion is that there are no motor vehicles there. That must be so because no subsidy is mentioned for motor spirit.

This is an excellent measure. It will be of great value to the Commonwealth. To me, the most important feature in this Bill is the encouragement and stimulus which the States, with the assistance of the Commonwealth, will be able to give to the cause of greater, balanced development. I commend the Bill heartily to honorable senators.

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