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Monday, 24 May 1965

Senator KENNELLY (Victoria) . - There are five Bills dealing with the dairying industry and four of them are consequential to the Butter Fat Levy Bill. I understand that the five Bills will be debated together. These five Bills replace Acts and provide for the imposition of levies. One levy is on butter which is exported overseas. The other is a levy on dairy commodities consumed in Australia. These levies will be devoted to sales promotion and to research in the dairying industry. The Minister for Customs and Excise (Senator Anderson) stated in his second reading speech that the collection of two levies caused unnecessary administrative difficulties. To streamline procedure, it is proposed to collect only one levy although the proceeds will be applied to the same purposes for which two levies were collected previously. This proposal has the approval of the organisations which more or less control the dairying industry. It is true that the amount of money to be raised under the provisions of this Bill and the associated bills will be larger than the total represented by the previous two levies. However, this also has the support of the dairying organisations.

This is an important industry. It is subsidised in many ways probably to the extent of £15 million or £16 million a year. There are in the vicinity of 34,000 dairy farms in the whole of Australia, and I read some time ago in the McCarthy report that there are 13,000 in Victoria. This industry employs many people apart from those actually engaged on the farms. The farms are much more highly mechanised now than they were in years gone by, but even today there is a tremendous amount of work to be done on them. The smaller farms, in particular, depend upon the work not only of the farmer himself but also of his wife and children. The industry also provides employment for a large number of workers in various factories throughout the country areas. In many instances it provides the economic lifeblood of small towns in Victoria.

Butter production last year amounted to 203,000 tons, of which over 91,000 tons, or nearly 45 per cent., was exported. The Minister's adviser was kind enough to tell me that the value of exports of butter is about £26 million per annum. If we add to that another £5 million or £6 million from the export of cheese, it is clear that this is an important industry.

The legislation gives the Board the right to strike a maximum levy of 6s. The only question 1 want to ask the Minister is: Has the Board the right to strike whatever levy it desires? The Minister has said that a 5s. levy will be collected this year, although the legislation sets a maximum of 6s. Is it the prerogative of the Board to say that the levy will be 5s. this year and 5s. 3d. next year, subject to a maximum of 6s.?

It is interesting to see how the levy is divided. Two-fifths of the proceeds have been devoted to overseas marketing, twofifths to the promotion of home consumption and one-fifth for expenditure on research. I have no doubt that that would be the division this year if the full levy were imposed. However, as the Minister has said, the levy this year will be only 5s. It is interesting to note that while two-fifths will still be used for the promotion of the sale of our butter overseas, the proportion devoted to promoting the consumption of butter in Australia has been raised. Instead of the levy of 5s. being allocated as 2s. for overseas marketing, 2s. for home consumption promotion and ls. for research in the industry, the Minister stated in his second reading speech that the Government intends to increase the amount for home consumption promotion. Instead of providing 2s. for home consumption promotion, the Government intends to provide 2s. 24d., the additional 2id. coming from the amount that formerly was allocated to research.

One matter that concerns me is the reason for the large fall in the home consumption of butter. I put it down to three things. First, price; secondly, the fact that different foods are being used to take the place of butter; and, thirdly, advertisements to the effect that we should keep our figures as they were when we were in our 20's, and that if we continue to eat this commodity it will have a bad effect on our hearts. I do not know about that, but in the year 1959-60 the consumption of butter was 26.2 lb. per head and in 1963-64 it was 23.9 lb. per head. That constitutes a considerable drop in consumption. Possibly it is due partly to the fact that since our immigration programme really got under way, approximately 2 million people have come to this country. 1 do not want to be unkind when I say that they were not used to eating as much butter as we eat in this country. No doubt they have followed here the eating habits which they had in their own countries. They are not the large butter consumers that we are. 1 do not think that anyone can shut his eyes to the fact that the price of butter has a marked bearing on the drop in consumption. I am not saying for one moment that we should get cheap butter. Members of the Australian Labour Party have always said that the person who works, whether it be as a farmer or in any other vocation, is entitled to a decent standard of living. The industry has been given an annual subsidy of £13£ million. There has been a lot of argument as to whether that bounty which works out at 7id. per lb., is really a consumer bounty. It is quite likely that if this bounty were not provided the economic position of dairy farmers would be such that they would not be able to remain on the land. It is interesting to read in a statistical bulletin on the dairy industry that in 1959-60 the exports of butter were 78,000 tons, in round figures, and that the figure rose in the year 1963-64 to 91,000 tons.

In the second last paragraph of his second reading speech, the Minister gave me and, no doubt, others, some food for thought when he said -

There are already signs that the European dairy industries are recovering from two lean production years and it is strongly indicated that surpluses of butter-fat will be re-appearing in world markets in the not too distant future.

That statement must give those who are engaged in the industry and those who attend to the administration of it - I am speaking of the Department of Primary Industry - some food for thought. As I have said, we are discussing five complementary Bills. I remember that Senator Cormack asked last night whether reports and recommendations of bodies on which these measures are based are available for perusal, but his questions were not directed to me and I will leave the Minister to answer them. It is true that, when one reads these Bills, one finds they are consequential upon the principal measure. So, when this Bill is passed, there will be no need for any debate on the remaining Bills. I say that the Opposition raises no objection to the passage of the five Bills.

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