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Tuesday, 22 October 1974
Page: 1847

The PRESIDENT - Order!

Senator Poyser - He is lying to the Senate. I am laying it right on the line to him because he is a cad.

The PRESIDENT - Order, Senator Poyser. Senator Webster, you implied that some honourable senators who were not respectable were not invited. I hope that you will make the necessary explanation otherwise you will have to withdraw that implication.

Senator WEBSTER -Mr President,when I started to speak vocal members on the Government side acted like a lot of clowns, if I may say so, and attempted to make it impossible for me to be heard.

The PRESIDENT - Order! Senator Webster, if you continue this type of debate I will sit you down.

Senator WEBSTER - I am surprised, Mr President. When I stood to speak there was so much noise that you had to call honourable senators on the Government side to order. I said that I understood that this committee had invited all honourable members of Parliament.

Senator Poyser - The honourable senator did not say that at all.

Senator WEBSTER -Well, honourable and respectable. If I can proceed, as I wish to do, may I say on a quiet note that Saturday afternoon was an inconvenient time to call members of Parliament to attend. But at this committee meeting it was stated that the Minister for Agriculture (Senator Wriedt) had been invited. I make it known that no member or supporter of the Government was present. Apparently the Minister did not see fit to provide anybody to be his delegate at this particularly important meeting.

Senator Poyser - Mr President,I again rise on a point of order. The implications made by Senator Webster earlier have not been explained by him. He implied that any person who was not invited was dishonourable. He made that statement. If he reads tomorrow in Hansard what he said he will realise this. He is now making an attack on the Minister for Agriculture because the Minister was unable to be there. But the truth is that this gathering was arranged by a certain gentleman named Russell who was the President of the Liberal Party in Victoria for many years. It was a rort; a complete rort.

The PRESIDENT - Order! Senator Poyser, if you wish to debate this matter you are entitled to do so but you are speaking to a point of order at the moment.

Senator Poyser - Surely. I shall do so.

The PRESIDENT - I disregard the point of order and call Senator Poyser.

Senator Poyser - No, Senator Webster is still on his feet.

The PRESIDENT - Does the Minister wish to reply?

Senator WEBSTER - Mr President,I was on my feet and I was interrupted by Senator Poyser.

The PRESIDENT - I call Senator Webster.

Senator WEBSTER - Thank you, Mr President. I make the point that this rally of farmers was particularly important because it pointed up the disadvantages with which the rural industries are burdened at present. I thought that it would be of interest for the Senate to understand some of the problems that are inherent in primary production at this moment. For instance, it was suggested at the meeting, on good authority, that in 1974-75 the trade deficit of Australia may be $ 1,000m. I make the point because traditionally the primary industries of this country provide a large segment of the export income. In 1971-72 primary production accounted for 48.9 per cent of total exports, but in 1972-73 it was 52.8 per cent. It is estimated that in 1974-75 the figure will be approximately 5 1.2 per cent.

I do not attribute to the present Government by any means all the problems that are besetting primary industry. Indeed, low export prices are one of the most inhibiting factors in relation to two of the main exports, meat and wool. It is suggested that during the 2 years that the present Government has been in office the returns to producers of cow beef have dropped 47.7 per cent, of ox beef 39 per cent and of wethers 23 per cent. The figure for wool has dropped approximately 19.4 per cent and for ewes approximately 14.1 percent.

Mr President,the importance of this particular sector of the industry suggests to us that it should receive from this Government better attention than it has received during the past 2 years. Indeed 7.38 per cent of the work force provides, or are expected to provide, over 5 1 per cent of the total exports of this country. One can go through a whole series of factors which are inhibiting the primary producer and with which, I imagine, even those senators in the Government who represent rural areas must be concerned. These factors include the imposition of higher interest rates. One may recall that this Government increased to the rural producer the cost of borrowing money. Primary producers were encouraged to borrow because of a 2 per cent disparity between normal interest rates and those charges to primary producers. That rate lifted. Compare a rate of 7.5 per cent, which was available 2 years ago, with the average figure now of probably 12& per cent or 13 per cent for primary industry. I feel that fact requires the attention of the Government. I think that it would be of great assistance in encouraging a return to stability in primary industry.

Primary industry has been disadvantaged because of increased costs of transport in rural areas. The assistance that was given to people who lived away from the seaboard, by way of a subsidy in petrol and fuel costs, has been eliminated because -

Senator Primmer - The removal of the petrol subsidy would not have affected one farmer who was at Beaufort on Saturday.

Senator WEBSTER -The honourable senators knew the meeting was on. I take it that he was occupied and could not attend. Apparently the Minister did not see fit to attend the meeting. That is the respect that the Minister showed for that sector of industry. People from over 200 miles away from Beaufort attended that meeting. Their costs of travel- indeed, the costs of running various motors on their farms- have increased due to the withdrawal of the fuel subsidy.

I wish to refer to a number of other matters. The tax deductibility concessions to primary producers for the provision of watering facilities on properties, for the provision of storage for fodder and for the provision of internal fencing on farms have been withdrawn by this Government. Previously these concessions were an encouragement. One could go through a great series of burdens that have been placed on rural industries. I have mentioned previously in this place that the Government, having assured the people when it was elected in 1972 that it would not increase taxation, eventually imposed a 10 per cent increase in company taxation on proprietary limited companies. This impost has been a burden to many producers in rural areas. I have mentioned previously in this place the retention allowance for smaller proprietary limited companies, a structure of legal ownership which has developed in this country over many years. A private company which is now being taxed at 47.5 per cent of its gross earnings finds that it is forced, unlike its partner, the public company which is also taxed at 47.5 per cent, to disgorge at least 50 per cent of its income after taxation. This factor is inhibiting those who wish to build up their own farms or industries in primary production. It is a most important factor for primary production, which I believe should be encouraged in this country.

A particular measure which has been introduced in the present Budget is the 10 per cent surtax on unearned income. We know that apparently a decision has been made by the Labor Party that the $25m tax that was to be extracted from those individuals in the community who earned less than $100 a week has now been eliminated and will apply only to those who have an unearned income above that figure. That will be a hard burden. We have not seen the Government legislation nor do we know how it will apply with regard to primary producers. But it is interesting to sum up the Government's words on what may be unearned income. I believe that it can apply to a variety of areas of primary industry.

The latest measure, which surely those on the Government side must debate very closely, is the new capital gains tax. Mr President, the capital gains tax, if it is introduced in the way in which this Government has suggested that it will be introduced, will have the eventual effect of being the greatest death tax that this country has ever known. Not only will it apply to probably everybody in the community who has attempted to have some savings for himself, but also to primary industry, to which my remarks are particularly related. Those who are involved in farms and who have assets from which they derive their income will be very hard hit by this tax. When this death tax and capital gains tax are taken into account, it is possible that a farmer who has a substantial borrowing on his property could lose the whole of that property because of the net value of the property as at 18 September, when the measure was introduced, and the probable escalation which will occur in the valuation of that property due to inflation. On that point I plead with the Minister and with other members of the Government to consider the proposal and see what effect it is likely to have on primary producers on small holdings in Australia.

The most important matter on which I would plead with the Government relates to the proposed cessation of the superphosphate bounty. As I understand Labor Party policy, it spells out support for a bounty on the use of superphosphate. I do not know whether I am correct in that understanding, but I do know from a reading of the policy speech that the Labor Party supports the use of superphosphate in order to encourage primary production, to ensure that produce from the primary industries is marketed to the Australian consumer as cheaply as possible and that exports of primary products are encouraged. In various areas of primary production the use of superphosphate over the years has enabled the Australian farmer to develop to the stage where probably he can be acknowledged as probably the most efficient farmer in the world.

Senator Keeffe - Ha, ha.

Senator WEBSTER - I hear a laugh from an honourable senator, but that is the type of thing we get from a man who is not even proud of his country and the producers of this country. It is regrettable that he should take that attitude. I am proud to know that in Australia there are primary producers and other workers who are able to produce more in an hour than would be produced in nearly any other country. Ours is a great nation and we are able to export primary products. Half our export income is earned from primary industries. But one of the most important factors in encouraging our primary producers to increase their volume of production has been the use of superphosphate. One would have imagined that when the Government decided to phase out the bounty on superphosphate it would have taken into account its own statement that it would not discourage the use of materials of that kind in primary industry. I recall listening to one member of the Australian Labor Party expounding to farmers the great importance of the superphosphate bounty. Although this was some years ago one would have been left with the impression that the use of superphosphate would be encouraged by the Labor Party.

As was stated to the meeting of primary producers on Saturday, there have been substantial increases in costs in the 2 years that Labor has been in office. For instance, in that period their input costs for vehicles have increased by approximately 31.8 per cent and the cost of labour on their farms has increased by 92.6 per cent. Shearing costs for wool producers have increased by 98.9 per cent in that short time. I plead with the Government to look at these costs. Before deciding to do away with the superphosphate bounty altogether it should acknowledge that primary industry needs assistance and should look for ways of providing that assistance. I am confident from the views that I have heard expressed along the corridors in this building that there is movement within the Labor Party to ensure that the superphosphate bounty is not phased out. Although the Minister for Agriculture (Senator Wriedt) has not commented on this we have heard remarks from Dr J. F. Cairns who said that the Government's decision on the superphosphate bounty was a bad mistake. Perhaps those words indicate that there is some tension and dissension within the Labor Party on this issue. It would be wonderful if we could hear from the Minister for Agriculture a statement like the one from Dr Cairns. I really feel that the Minister believes that the bounty should be continued.

The cost increases which I mentioned a while ago are not due entirely to a reduction in the bounty on superphosphate but have been due mainly to costs which it would have been beyond the capacity of the Government to foresee. Because of the increased cost of rock phosphate and other materials, by the 15th of this month the price of superphosphate had increased by 116.4 per cent since Labor took office. Because of that alone I would plead with the Minister to review the decision to phase out the superphosphate bounty. Sufficient evidence is available to show that many people throughout the world are deficient in nutrition and some people are starving. One would have thought that in a situation of that kind a Labor Government would be concerned to say that here was an opportunity to help by encouraging the simple farmer to produce more.

Senator Poyser - What do you mean by 'the simple farmer'?

Senator WEBSTER - I am a farmer and I am a simple person. I would say that the farming community must be encouraged to use whatever device will enable it to increase production for the benefit of mankind. In order to give some indication of the way costs have increased I mention that in 1972 the price of superphosphate ex works in Victoria was $14.90 a ton. By 1973 it had reached $ 1 5.55 a ton and in 1 974 it is $34.05 a ton. It is proposed now to withdraw the subsidy which is approximately $1 1.81 a ton. The effect of this will be to increase the cost of superphosphate ex works in Victoria to $45.46 a ton. A farming proposition with which I am associated finds that the cost of putting superphosphate on the ground within 40 miles of Melbourne will be more than $56 a ton.

Senator Wriedt - That is what is hurting you; it will cost you a few more dollars. You are not worrying about others.

Senator WEBSTER - One would think that somebody would leap to his feet in an attempt to protect me from the attack of a Minister who would suggest that this is what prompts me to make these remarks. I am sure that all honourable senators heard the Minister. The remark was unworthy of him. Perhaps I should spend another half hour on this subject, during which I could refer to Hansard and quote his remarks that the truth will come out. We know how much Unilever and the margarine industry poured into the Labor Party's coffers. But honourable senators opposite do not want to hear about that. We know what makes the Government tick at present.

The PRESIDENT - Order! I remind Senator Webster that he is being quite provocative and is attracting the fire of senators on my right. I ask him to moderate his remarks in presenting his case to the Senate.

Senator WEBSTER - I was being moderate until the Minister butted in with his inane comment. I can only say that I hope that the Minister is taking this matter straight to his heart. I believe that he would wish to see agriculture encouraged in this great country. In many areas encouragement is needed. One can only predict that if the superphosphate bounty is eliminated, little superphosphate will be used in the coming year.

Honourable senators may recall that in the early part of this year the Opposition moved that before the bounty was eliminated it should be mandatory that the matter be referred to the Industries Assistance Commission. The Minister indicated prior to the May election that there would be an opportunity to debate this matter. I suggest that we should have that opportunity. I suggest also that if there is no possibility of a discussion in the Senate of this important matter the Government should give consideration to revising its policy and not do as is rumoured- remove the present subsidy and substitute a subsidy of $8 a ton. I suggest that the superphosphate bounty needs to be doubled in the coming year to enable us to cope with the problem of increasing production. The Government must do all of those important things which I have stressed to assist us in our export production, to assist in lowering the cost of production for the simple people of Australia who are the consumers, and to do what Labor promised prior to becoming the Governmentthat it would not-abolish the superphosphate bounty.

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