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Wednesday, 11 September 1985
Page: 439

Senator TATE(12.19) —This morning we have had a display of the barbaric, dismantling mentality which is possessing members of the Opposition as they gather force behind the discredited former Treasurer, now Leader of the Opposition, Mr Howard, in their mania for destroying some of the greatest corporations which are owned by and serve the Australian people and which have been created by visionary leaders, both Labor and Liberal, over the past several decades. They have taken as their vehicle for mounting their first campaign in the war against these great enterprises owned by the Australian people the Snowy Mountains Engineering Corporation Amendment Bill, which is designed to modify the functions and structure of the Snowy Mountains Engineering Corporation. The Corporation is a consultant engineering corporation which is obviously derived from one of the greatest and most beneficial national engineering projects and teams put together for the Australian people by a Labor government in the face of virulent hostility from the then Liberal leader, Mr Menzies. It is interesting to note, nevertheless, that the Snowy Mountains Engineering Corporation was established by a great Liberal Prime Minister, John Gorton, who, because he had a vision of Australia which was greater than that of the State branches of the Liberal Party which destroyed him, was finally forced from office. He had a vision for Australia which allowed him to build on the great success of the Snowy Mountains project which will, as I say, be regarded as one of the greatest and most beneficial engineering enterprises ever undertaken in this country.

It is not right to say, as Senator Parer said, that that was a long time ago. Many of those who took part in the inaugural activities of the Snowy Mountains teams are, of course, no longer with the current Engineering Corporation. However, should we not take into account corporate ethos and pride? One finds that people who enter private enterprise are influenced by a spirit of achievement, enterprise and excellence which has characterised those who have preceded them. We are saying that the Snowy Mountains Engineering Corporation falls into that category and has inherited the skills, the ethos and the excellence built up in the early days of the Snowy Mountains Hydro-Electric Authority which it succeeded. Indeed, that achievement has been recognised. The Governor-General made three awards for export performance to acknowledge the activity of Australian organisations or private enterprise firms that had engaged in export activity over the past decade, one of which went to this organisation. The distinguished United States publication Engineering News Record put the Corporation on its list of the top 200 most significant engineering consulting firms in the world. So we are not talking about some bureaucratic enterprise which has-

Senator MacGibbon —You are giving us a history lesson. Deal with the present.

Senator TATE —I am coming to the present. I am saying that these are acknowledgements by the Governor-General and an eminent United States publication of the current status of this Corporation. It is not true to say either, as Senator MacGibbon has said, that the Corporation has a very seedy management. This was his defamatory comment about the people who put in the effort for the Corporation.

Senator MacGibbon —I never said `seedy' at all.

Senator TATE —The honourable senator did. If he looks at the Hansard he will find that that is what he said. `Very seedy management' is what he said.

Senator MacGibbon —I said `senior'.

Senator TATE —The honourable senator said that it cannot attract people with current market skills and judgment. In fact, Mr Liebelt, a former group executive director of Conzinc Riotinto of Australia Ltd, has been appointed interim chairman of the Corporation. I would have thought that he would bring all his skills and experience at CRA to bear in the operations of the Corporation. I am sure that that will be well reflected in the activities of the Corporation.

The Corporation has acted magnificently and has paid dividends and taxes to the Australian people. Senator Siddons pointed out that, in current Australian dollar terms, $40m has been paid over the last decade by the Corporation to the Australian people by way of dividends and taxes. However, because the Corporation is going through a rough period the political vultures on the other side of the chamber have decided to swoop and dismember and remove this Corporation from the Australian scene.

Senator Lewis —If it were big business you would not hesitate to swoop. I never heard you say that you would keep BHP alive or any other private company. They would be bankrupt and you would be laughing.

Senator TATE —The fact is that we have a corporation-

Senator Lewis —Why don't you be sensible? Why should the taxpayers carry a company that is in trouble?

Senator TATE —The fact is that the reason for the trouble has not been analysed. Senator Archer talked about the lack of motivation on the part of the members of the Snowy Mountains Engineering Corporation teams. The reason is very simple.

Senator Lewis —The reason is that it is building up an enormous superannuation debt.

Senator TATE —Mr Acting Deputy President, will you protect me?

Senator Lewis —That is the reason why it is in trouble.

Senator TATE —Will you protect me against this outrageous intervention? The reason is that over the past two or three years there has been a substantial loss of oil revenue to many of the members of the Organisation of Petroleum Exporting Countries which have financed a tremendous amount of engineering activity in Third World developing countries of the kind which the Snowy Mountains Engineering Corporation used to undertake. With the lowering of the level of those sorts of activities in respect of Third World and developing countries, caused in large measure by the cessation or diminishing of the flow of recycled petro dollars into the development projects of those countries, there has been-

Senator Lewis —Yes, but the private sector has to cope with that sort of cutback.

The ACTING DEPUTY PRESIDENT (Senator Jones) —Order! I ask Senator Tate to direct his remarks through the Chair. I ask Senator Lewis to cease interjecting. Senator MacGibbon has had his say and I now ask that Senator Tate be allowed to have his say.

Senator TATE —The fact is that the development projects previously undertaken by Third World countries and in which Australian enterprises such as the Snowy Mountains Engineering Corporation used to participate are not as common as they used to be. This has led to a diminution in the activity, and therefore the general profitability, of the Corporation over the last two or three years. That means, of course, that we must have a period in which there has to be a re-adjustment of the Corporation. That is evidenced by the fact that it has reduced its workforce from some 600 to 380 employees. As I have pointed out, it has taken into its top management area people with experience such as an executive director of CRA. In that way, I believe it is shaping up as an organisation which can operate profitably into the future.

This debate is not really so much about the Snowy Mountains Engineering Corporation. It is about the destruction of many great public enterprises which, as I say, have so far served Australia very well. Mr Howard gave notice in his address to the National Press Club on 28 August and in his statements since assuming leadership of the Liberal Party of his intention to make this a key element in the Opposition's appeal to the Australian people. He said that he would not even take fright at some element of foreign ownership in the Commonwealth Bank. He is prepared to sell off elements of the Commonwealth Bank to foreign owners. He is prepared to do that because he recognises that if he tried to sell those elements on the Australian domestic market interest rates would soar as people competed to raise money to buy shares within Australia. That is the reason he gave at the National Press Club for wanting to sell part of the Commonwealth Bank overseas. This is the sort of madness which is now possessing the Opposition.

Mr Howard says that he believes in a free market. Senator Archer, in opening for the Opposition in today's debate, said that perhaps we could sell off portions, if not the whole, of the Snowy Mountains Engineering Corporation to the Corporation's work force. He thinks it should be sold to the 380 members of the Corporation who, as Senator Siddons pointed out, are unlikely to have accumulated much in the way of great capital assets. These people would have been working for salaries and wages during the course of their working life. Senator Archer is supposing that somehow these 380 people could finance the acquisition of the Corporation which is worth many tens of millions of dollars. It would not be possible for them to do so unless we did what Mr Howard suggested could be done with Telecom Australia. Mr Howard said that we could sell off portions of Telecom-these would be only the profitable portions because, of course, the Government would leave the unprofitable portions in public hands-to the workers at a below market price. This is what has been suggested by the great marketeer from the other side of politics. By doing this he would be offering a bribe to the workers of Telecom to take out shares at less than the market price which they could then sell on a future occasion and make a capital gain. That is the sort of mess that the Opposition's ideological crusade is getting it into. We have got to the stage where in order to satisfy the cries and bleats of those who demand that organisations such as the Snowy Mountains Engineering Corporation be dismantled and sold to the private sector, we must sell overseas or sell to employees at a below market price in order to encourage them to abandon the present situation.

The attack by the Opposition on this Bill is only part of the overall fight for privatisation which it is launching. I believe that the Australian people will see that there is nothing of value in that proposal. In fact, what will occur is that the services provided, particularly by Telecom, will become much more expensive for those who live in country areas. Senator Sheil is sitting here. I am sure that members of the National Party of Australia are as concerned as we are that persons in remote areas of Australia may be faced with the prospect of not being able to enjoy the considerable cross-subsidy that takes place at the moment in the provision of services to them through the Telecom organisation. It is quite clear that if Telecom were to be dismantled, what would be sold to private enterprise would be the very profitable inter-capital city trunk routes and the new technology areas which Telecom has so well pioneered, particularly the area of computer access to information banks.

Of course, it is never mentioned by honourable senators on the other side that the postal services area is self-sustaining financially and does not cost the taxpayer a brass razoo. Telecom and postal services are under attack. Qantas is a target. The Commonwealth Bank is to be sold, part of it overseas, if Mr Howard has his way. The first off the rank as far as the Parliament is concerned is to be the Snowy Mountains Engineering Corporation. It seems to me to be a sad commentary on the Opposition that it has such a lack of patriotic pride in the quality and excellence of the work undertaken by that organisation, in succession to the traditions established by the Snowy Mountains Hydro-Electric Authority, that it should consider such a matter.

When one looks through the annual report of the Snowy Mountains Engineering Corporation one sees that not only is it engaged in a number of very significant domestic and Australian projects but also it is involved overseas in Indonesia, China, Fiji, India, Bangladesh and Bahrain in the provision of engineering skills and management and the construction of projects which create extremely good focuses for countries in those regions for the appreciation of Australia and the skills it can offer. As is directed by this Bill, the Snowy Mountains Engineering Corporation, in undertaking many of those activities as a flagship for Australia, carries with it many private engineering firms and consultancies. In fact, in the list of functions set out in clause 6 of the Bill is a direction of the Parliament, if this Bill is passed, to ensure that the Corporation shall endeavour to:

(b) so far as is practicable, involve Australian organisations in the performance of its functions overseas; and

(c) promote overseas the interests of the Australian engineering industry.'';

There is a very clear indication that if this Bill is passed, the Corporation is to do as it has been doing, but in a way sanctioned and required by the Parliament, and involve Australian engineering industry from the private sector in these activities to the greatest extent practicable. In that way, I believe many openings will be provided for Australian private enterprise which has the engineering skills to offer to complement and supplement the activities of the Snowy Mountains Engineering Corporation.

I am really very pleased to be involved in this debate at such an early stage in the battle over privatisation that is to be waged by the Opposition. I believe that the Australian people, as they become more conscious that privatisation means selling off assets owned by all Australians to some Australians and some overseas investors, will reject the carrot that is offered of helping to pay off some of the overseas debt by the once-only gains that are made by these sales. I believe more and more too for that matter that Australians will become conscious, as the months proceed, of the nature of Australia's overseas debt and the small portion of it which can be attributed to and which is the responsibility of the Australian Government. Most of Australia's overseas debt is incurred by private enterprise going outside of Australia in order to raise money overseas for its activities, such as the non-productive takeovers we have seen cluttering the financial pages and even the headlines of our media over the past several months. However, that debate is for another day.

All I wish to say at the moment is that the Government stands firmly behind this magnificent Snowy Mountains Engineering Corporation. We expect it to come out of the trough it has been in with a new management team, a leaner work force and a change in possibilities overseas as the effects of the depression in oil prices that I mentioned as a contributing factor to the lowering of development activity overseas in third world countries is remedied. I believe, with Senator Siddons and the Australian Democrats, that this Corporation, as the years progress, will be a great flagship for Australia overseas and I wish it well as it is set on its way by the Parliament in this amendment Bill.