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Wednesday, 29 February 1984
Page: 113

Senator SCOTT(10.37) —I move:

That the resumption of the debate be made an order of the day, for the first day of sitting after 1 May 1984.

I would like to speak to this motion at least in some detail as I think it is necessary to explain the position. It appears, at least to those of us on this side of the Senate, quite extraordinary that the Government and the Minister for Primary Industry (Mr Kerin) have persisted with the Live-stock Slaughter (Export Inspection Charge) Validation Bill 1983. It was brought before the Senate on the last day of the sitting last year but was not debated. It was evident that the Government was not aware of the real difficulties and real problems of the industry to which these increased costs were to apply. Consequently it was hoped that a proper measure of consultation would, at least in part, resolve the issue .

Taking advantage of the recess and of the fact that the Government had not pursued the legislation late last year such consultation has occurred. Indeed committees have been set up to investigate the area of cost effectiveness of meat inspection-indeed of the industry itself. As the Minister has said the Interim Inspection Policy Council is to carry out as a matter of priority an examination of the financial and economic aspects of the current recovery of inspection costs in the export meat industry. The Minister has asked that the Council's report be available by the end of April. That is a reasonably short period and to us it seems most inappropriate, indeed not understandable, that the Government would want to pursue this legislation which would impose an extraordinarily heavy cost structure on the industry in the absence of an opinion to be formed by the Council and the result of widespread investigations and hearings which are to take place across Australia in Brisbane, Sydney and Hobart during the week commencing 12 March 1984 and in Perth, Adelaide and Melbourne during the following week. It will be a widespread and in-depth inquiry into a whole range of issues that relate to the export inspection of meat, to the calibre of that inspection and to its cost. It will relate that to the industry in the current circumstances in which it finds itself and indeed in the circumstances in which it has to compete in a highly competitive and, at the moment, somewhat down-graded meat export industry.

This legislation was introduced into the House of Representatives as long ago as last September, I believe, and it represents a desperate attempt by a Government, which at that stage was ill-informed, apparently to head off a legal challenge by the industry. Much more particularly, the legislation was evidence of the Government's lack of capacity and determination to do the very things that it talks so consistently about-to consult with the industry, to examine the industry's position in the economy and to come to some sort of responsible consensus. Obviously it has refused to do that. As late as, I think, 24 November last year the Minister for Primary Industry again insisted that the Government would be pursuing this legislation and the imposition of these extraordinarily heavy charges at a time which was perhaps the most inappropriate.

The purpose of the Bill is to validate meat inspection charges from 1 January 1983 to 21 November 1983 due to a technical deficiency in the legislation since the beginning of the year. The Bill certainly should not be passed by this Parliament until the sort of investigation that I and the Opposition have referred to has been carried out. Fortunately the Government has established a proper inquiry into the cost problems of this most important industry but having done that why on earth it should pursue the legislation seems beyond understanding.

The whole matter arose in the first place because of the Government's determination in the 1983 Budget to impose very significantly increased charges for meat inspection. 'Significantly' is not nearly a strong enough term, because the charges that were imposed as a result of that Budget represented an increase of 200 per cent, an increase from $1.80 to $5.40 per head-an insufferable proposition. The original Commonwealth charge of $1.80, which had been in force, unaltered, since 1979, compared more or less favourably with the charges in the States of $1.50 in New South Wales, $2.08 in Victoria and as low as $1.06 in Queensland.

This sort of increase was an insufferable addition to the cost structure of an industry that had been finding times difficult indeed. It occurred at a time when the industry, like many other of Australia's rural industries, was recovering from the most severe drought in its history. An increase at such a time was impossible for the leaders of and participators in the great primary industry in general and in the meat industry in particular to understand. There seemed to be no justification for an industry, fighting its way through a drought, to be suddenly hit by a 200 per cent increase in one section of its cost structure.

People probably fail to recognise that for rural industry to recover from a drought of the severity of the 1982 drought, following as it did a pretty lean period in 1979, 1980 and 1981, takes a very significant time indeed, particularly in the livestock industry. The livestock industry needs a period not of weeks or months but of years to recover in terms of numbers and standard of stock and in its capacity to compete in the world market.

Senator Harradine —Some areas are still affected by drought.

Senator Crichton-Browne —Exactly.

Senator SCOTT —Some people have forgotten this. As Senator Harradine says and Senator Crichton-Browne from Western Australia says, some areas of Australia are still very significantly affected by drought. Since they remind me of that, I should also say that some significant areas of primary producing land in Australia are almost totally devastated by flood. There is an irony in the fact that after literally years of drought, one should be ravaged by flood, which can be almost as devastating. So the period needed for recovery after the drought and the consequences of the drought, I suggest, make this legislation more inappropriate now than it could ever have been.

The other matter that makes this a totally inappropriate time to consider even some increase in charges-if indeed there is to be any-is the fact that the industry is struggling and has struggled through a period of depressed prices. Competitively it finds itself in a very serious situation. It has taken this industry many years to recover to some real degree from the loss of market it suffered when the United Kingdom moved into the European Economic Community and as a result of that Community's attitudes. I believe that the sort of competition with which this great meat industry in Australia is confronted is worth remembering. It is a very significant competition with competitors who are helped immeasurably by their governments and their taxpayers. The meat industry in Australia stands on its own feet. It relies on its own efficiency and on its breeding capacities and standards to compete around the world. It is an industry which has virtually no support from the Australian community. Basically it does not seek that support, but it does seek a fair deal in areas such as cost structure, over which governments have a significant measure of control.

It is important to recognise that this industry, unaided in Australia and confronting on world markets all forms of competition, is an industry which does not have the sorts of benefits that are common to its major competitors. I believe, for instance, that we should remind ourselves of the circumstances of the European Economic Community, where there is a complete block-out of the mass of Australian products and where prices are bolstered by a very significant subsidised system, to the extent that subsidised surpluses are nowadays moving into the free markets of the world and making those markets very much more difficult places indeed. So our producers face enormous subsidising of competitors in the European Economic Community.

It is worth remembering that in the last couple of years New Zealand has subsidised its sheep meat industry by in excess of $500m. South America, a competitor of Australia in the beef and veal markets of the world, has preferential access to many parts of Europe and export rebates and long term cheap loans. These are some of the advantages of yet another competitor. On the Australian side of the coin, the Australian producer virtually starts about $40m behind scratch because that is his contribution to meat export inspection.

The meat industry in Australia represents something like $1.5 billion in export earning capacity, and something like $1.2 billion of that is referable to beef and veal alone. When talking of the problems which have confronted this industry and which have been significantly increased by the determination of the Government to press ahead with the proposition of a 200 per cent increase in charges it is worth remembering that the state of the industry is bringing about significant unemployment in a whole range of areas. In the abattoir areas around Australia many people have been laid off. Hundreds of workers have been laid off in meat works in Victoria, Tasmania, Western Australia, Queensland and New South Wales. Some of these meat works are closing down and some have closed down altogether. Others are in a skeleton staff situation.

I suppose it is worth recalling the measures that the Government has taken to help the steel workers in this country. That may well be a good thing; I am not saying that it is or is not. But clearly that same sort of responsibility and concern has not been exhibited towards rural workers in this country who in this case cover a very wide range of people, including people in the refrigeration and transport industries as well as people within the precincts of the abattoirs themselves. Hundreds and, indeed, thousands of people are involved, and many hundreds have already lost their jobs. Not only have those hundreds lost their jobs but also literally thousands of people are living in complete uncertainty and dismay just wondering whether this week or next week, or next month, their area of operation and work will be forced to close down because it has become non-competitive, basically as a result of the enormous and continuously increasing charges levelled at it.

I believe I have made clear the point that caused us to seek the adjournment of the debate on this legislation. It is virtually unbelievable that a government, having recognised, apparently, the need for consultation in this industry and the need to identify the penalty of charges being brought into the industry through the 200 per cent increase, having set up two proper committees, having given them clear instructions and guidelines for investigation and having asked them to report as a matter of priority by about the end of April, should then seek to pursue this legislation. The Government was tardy enough in taking those steps and for a significant period, to the end of November, was arrogantly insistent that it would not alter the charges and would be pressing for their implementation.

For all those well-based and sound reasons we have sought the adjournment of the debate so that when matters come to a head again and when the question of export charges is examined again by the Government it will at least be in receipt of a responsible examination by responsible committees and will be talking with some real knowledge of the industry with which it seeks to discuss and come to some responsible arrangement in this area.