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Tuesday, 7 May 1985
Page: 1783

Mr HAWKER(9.02) —In commencing my speech tonight, I will take up a couple of the points made by the honourable member for McEwen (Mr Cleeland). The first point, which I think he completely missed, related to the issue of Commonwealth funding. Under this legislation as proposed there will in fact be a ceiling on the funding-

Mr Cleeland —An increase.

Mr HAWKER —No, a ceiling. Under the former Government's arrangements there was no ceiling and there was generally funding on a one to one basis to the level that the industry could match. Therefore, to talk about increases is really rather spurious. The point is that under this legislation there will be a ceiling and, once that ceiling is reached, as the Minister for Primary Industry (Mr Kerin) pointed out in his second reading speech, it is up to the industry to supply all the funding over that amount. I must admit that in listening to his speech I was fascinated to find that World War I and World War II came into rural research. He may explain that to us one day.

He also talked about the Government being serious about attacking farm costs. The National Farmers Federation has given the Government a very good little booklet which explains how to attack farm costs and points out why they are making agriculture so uncompetitive on world markets. I understand that, despite at least two meetings with the executive of the NFF, senior members of the Government, including the Minister for Primary Industry and the Prime Minister (Mr Hawke), have rejected the basic arguments put in that farm costs document. I therefore find it hard to understand how the Minister can suggest that this Government is serious about trying to help primary industries to tackle the farm costs problem.

In speaking to these Bills tonight, I will confine my remarks to the Rural Industries Research Bill. In so doing, I support the Deputy Leader of the National Party of Australia, the honourable member for Gwydir (Mr Hunt), and the honourable member for Wakefield (Mr Andrew) in their comments. It is interesting to note that the Minister in his second reading speech when introducing these Bills summed up the position rather eloquently when, concerning research, he said:

It is necessary . . . that rural research is organised in a way which will ensure that there is adequate research investment, that the greatest possible returns are achieved from each dollar spent, and that those who administer and undertake research are fully accountable to the providers of funds.

That is an excellent aim and I certainly hope that these Bills will achieve that. However, he went on to talk about the funding levels. I have already mentioned this in response to what the honourable member for McEwen said. I suggest that as the current annual gross value of primary production in Australia is about $14 billion, 0.5 per cent of which is $70m, the Government does in fact have a bit of a commitment to match. Although I know it is over five years, $70m is much more than the $32.6m mentioned in the second reading speech. Of course, the Minister states that under these arrangements wool is at present excluded. But I just draw the attention of the House to some comments about wool research made at the annual meeting of the Wool Council of Australia and reported tonight as follows:

Wool industry leaders called on the Federal Government today to stop diverting funds for vital rural industry research into other areas of research.

This was stated by the Chairman of the Australian Wool Corporation, Mr Asimus, and other wool growers. Mr Asimus is also reported as saying:

Budget pressure on the CSIRO in recent years had gone far enough and it was time for the wool industry to 'stand up and start beating the drum' to stop a drift of funding from rural research.

Also at the meeting one of the members of the Board of the Corporation, Mr Silcock, said that 'an example of CSIRO fund cutting was a cut over two years of $500,000, or about half, in funds for the biological de-fleecing program'. I suggest that if we are to make a serious attack on the costs facing wool growers in particular these are the sorts of research projects that are urgently needed to help cut the costs. On the subject of the Commonwealth Scientific and Industrial Research Organisation, which has already been mentioned by my colleagues, I refer honourable members to a question on notice to the Minister for Science (Mr Barry Jones) from the honourable member for Gwydir. In answer to whether CSIRO had been given a direction to change the emphasis of its funding, the Minister said:

No formal instruction has been given to CSIRO to alter the proportion of its funds devoted to agricultural research but I have suggested--

I like the way he puts it-

to CSIRO that it should work towards deploying resources away from agriculture, mineral, energy and water resource research--

In fact, he cites the figure for the current percentage of the CSIRO's funds going to rural industries as 31.6 per cent. Under his proposal, that will be cut back to 29 per cent. The Government should look again when it talks about how serious it is in supporting the rural industries. The importance of rural research is found if one reads various reports that have already been alluded to. The Balderstone Working Group report to the Minister for Primary Industry in September 1982 entitled 'Agricultural Policy-Issues and options for the 1980s' touched on a number of matters of rural research and in particular the question of government funding and who should actually pay for research. In its report it is stated:

The Group considers there are a number of valid arguments in support of public funding:

These arguments are summed up in four points as follows:

Individual farms are too small to carry out advanced agricultural research since the expenditure threshold for scientists and equipment is beyond the capacity of the individual farm.

The community, by taking a longer term and sometimes different perspective on potential research benefits, is often prepared to fund research activities which would not be considered 'economic' by private firms.

Private firms often cannot capture the gains from research, especially if the new knowledge cannot be incorporated in a patent . . .

I take the point made by the honourable member for Wakefield about plant variety rights. We have had one inquiry after another into this matter. The former Government introduced some legislation for plant variety rights back in about 1982, but still there has been no action. I understand from what the honourable member has said tonight that there is to be another inquiry. The Minister stated, even before he was a member of the Government, that he believed that plant variety rights were worthwhile, certainly in some areas. I hope that the Minister will take this point on board and have another go at the question and that he will not keep putting it into the too hard basket. The matter has been inquired into over and again. If the answers are not known now, they never will be known. The fourth argument which the Balderstone report put in favour of public funding was:

Externalities justify public funding. That is, publicly funded research is needed in the areas of health, safety and 'quality of life' . . .

The group said:

Overall, the Group believes that agricultural research funding should be increased and that increased expenditure should be concentrated on applied research. The benefits producers derive from research justify an increase in their proportionate contribution to research funding. The Commonwealth should also significantly increase its overall funding of agricultural research. The Group considers that research is an appropriate area for providing assistance to raise farmer incomes on the grounds discussed . . . in another part of the report.

I think that is very important, because we have mentioned farm costs and this is very much in line with how the Federal Government can assist in alleviating farm costs. There have been several reports in a similar vein on this matter. As time is rather limited, I will not go into too much detail. However, the October 1982 report of the Senate Standing Committee on National Resources says quite a bit about the importance of agricultural research, mentioning some of the successes in the past and how it is important to continue with it. When looking at the question of economic analysis of whether research can be justified, one should look at the Industries Assistance Commission report in 1976 called 'Financing Rural Research'. It states:

Economic analyses in a number of countries point to agricultural research being highly profitable and having a significant effect on the rate of productivity increase.

So there are very good grounds for the Commonwealth and the States to continue assisting in rural research. We have seen some excellent innovations over the years and as the honourable member for Wakefield pointed out, many of those innovations were at the initiative of individual farmers.

There are a couple of important parts of this Bill that I hope the Minister for Primary Industry will take on board. The first is that in order for this legislation to achieve what he really wants it to and what we hope it will do, it is vitally important that the best people possible be selected for the positions on the research councils. I am sure that the Minister is conscious of this, but I hope that he can really achieve it. If it is not achieved, a lot of the effort involved in this legislative change will be wasted. There is no doubt that Australia's primary industry can have a great future, but that future will depend to a very large extent on the success of current and future agricultural research.

Whilst supporting this Bill, I also support the amendment moved by the Deputy Leader of the National Party. I realise that the Minister has been very busy with a number of matters but, nonetheless, I think he ought to consider how he approaches his legislative program and give himself enough time so that he can consult the industries that will be affected by this legislation.