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Wednesday, 10 September 1958

Mr BIRD (Batman) . - I intend to devote my attention to the Australian aircraft industry because I consider that, the circumstances being as they are, it is high time the Government made some tangible decision concerning the future of this allimportant industry. At the moment, the industry is in a state of uncertainty. Government policy is varied almost from day to day, with the result that optimism is fast waning in the industry and skilled per.sonnnel engaged in it are looking for other avenues of employment because they just do not know how long they can expect their present employment to last.

From time to time, we on this side have directed questions to the Minister for Supply (Mr. Townley) in an endeavour to ascertain what the position is. Whilst the Minister does his best under the circumstances, I want to say categorically that the answers given so far have been satisfactory to nobody. Many months ago, in an effort to create the impression that something was being done to stabilize the industry, the Government appointed a business committee to inquire into the industry and to make recommendations concerning its future. That committee heard evidence many months ago, and up to the moment, so far as I am aware, no firm recommendation has been made known to the Parliament, or to the public as to what may be done for the future of the Australian aircraft industry.

About three weeks ago, in answer to a question by me, the Minister stated that the Division of Aircraft Production at Fisherman's Bend had received further orders for Jindiviks, and could expect to continue to construct these Jindiviks and carry out modifications to a few Canberra bombers for the next couple of years. He pointed out that nothing was visualized for the Commonwealth Aircraft Corporation employees except the completion of an additional order for Avon Sabre jets that was given some months ago. The Minister for Defence (Sir Philip McBride) stated to-night that during this financial year the orders for the Sabre jets will be almost completed, so that it can be seen, that unless something concrete is announced very shortly, the industry will be truly in the doldrums and there will be little cause for optimism about the future. I should say that morale of the personnel engaged in the industry is ebbing fast. I have been approached by representatives of trade unions concerned with the industry in Melbourne seeking information as to just where the employees stand. The Government has procrastinated for two or three years now. and it is high time that we had a definite announcement as to what the Government proposes to do.

In 1957, the Commonwealth Aircraft Corporation was somewhat concerned about the future of the industry and made top level representations to the Government asking, quite fairly, what the future held for it. The corporation was given an order for an additional 21 Sabre jet fighters. I imagine that was done to keep the employees quiet for the time being and to give the Government an opportunity to make up its mind. Actually, the reprieve given to the Commonwealth Aircraft Corporation was only temporary. The work created by the additional 21 Sabre jet fighters will not last for very long. It is expected that this order will be completed within a few months now.

Unfortunately for the industry, over the last two or three years, political and defence authorities have debated or left undecided, the question of replacement equipment for the Royal Australian Air Force. We were told some years ago that some new type of fighter should be constructed because the Sabre jet was fast becoming obsolete. Unfortunately, tied up with this matter is the whole future of the Commonwealth Aircraft Corporation in this industry. The position now is that an industry of unquestionably great defence background utility and high technological standing is tottering in the balance because of political indecision. Because of the uncertainty of the Government about the future of the industry, those connected with the industry have become so plagued that they do not know whether they are coming or going. That feeling exists from the highest to the lowest level of the employees. I did hope that by this time the high level business committee which the Government appointed some months ago would have made a recommendation and that the Government would have adopted that recommendation and made a firm announcement as to what the industry could expect in the future. But nothing along those lines has happened.

I should like now to give some idea of the way in which the Government has treated this industry over .the last three years. In 1955, it was recommended that the Royal Australian Air Force should be equipped with Lockheed F104 Starfighters. In March, 1957, the Government announced, through the Prime Minister's defence statement in that month, that an aircraft equivalent in performance to the FI 04 was to be selected for production by the

Commonwealth Aircraft Corporation. That announcement was made eighteen months ago. The Minister for Defence then went on a mission to Washington, came back, and told all and sundry that the Government did not propose to equip the R.A.A.F. with the FI 04 Starfighter. I understand that the latest suggestion - and it is only a suggestion at the moment - is that a new American supersonic twin jet fighter, the Northrop N156F should be adopted for the re-equipment programme. In view of the fact that orders for the Avon Sabre jets and the Canberra bombers are now being carried out, the Government should put the Australian aircraft industry out of its misery by making a definite announcement as to what it proposes to do. If it does not, it will mean that in time the aircraft industry will be denuded of its skilled personnel, who will look for other avenues of employment. They are not prepared to stay in an industry that may last for only another six months. The more highly skilled craftsmen - toolmakers and men of that description - can get offers of lucrative employment outside.

I think most members of the committee will agree with the two points I am about to make. The first point is that the R.A.A.F. needs a new fighter to replace the Avon Sabre jet. I do not think there will be any argument about that. Secondly, the Government has, by word of mouth, announced that it will produce a fighter in Australia. However, because of the delay in making a positive statement, a great deal of doubt exists as to whether the Government means what it says. The Government will be firmly believed by the Australian people only when it says definitely what it intends to do. It should make a speedy decision on this matter in order to allay the doubts that exist in all sections of the aircraft industry.

Only recently I read in the press that Indonesia was acquiring MIG 17 fighters from Russia. I read in the press the following day that R.A.A.F. authorities were of the opinion that the MIG aircraft was superior to our own Avon Sabre jet. That is very disquieting. We must face the fact that Australia will never be able to get first-class aircraft from overseas when she wants them in an emergency, because the countries that make those first-class aircraft possibly will be facing the same state of emergency and will require the aircraft for their own purposes. It is quite possible that in grave times we would have to fend for ourselves in the production of aircraft. Therefore, it is time that the Government made up its mind. To-day the aircraft industry is just getting along by nibbling at small orders - an order worth a few thousands of pounds from here and an order worth £50,000 from somewhere eke.

The Commonwealth Aircraft Corporation factory in Victoria has the most modern equipment. I cannot speak too highly of the machinery and the personnel. However, we find that it has to take all sorts of engineering work in order to keep its personnel together. It cannot keep on doing that, because the source of the work that it is getting is rapidly drying up. Unless it can obtain firm orders for aircraft, it will have to dispense with more of its skilled personnel. Because of the present circumstances, brought about by the vacillation of this Government, the staff of the Commonwealth Aircraft Corporation in Melbourne has been reduced from nearly 5,000, at the height of the Sabre jet programme, to fewer than 3,000. That is bad. It means that men who have acquired the art and skill of aeroplane production over the years are leaving the industry. It is not an art or a skill that you can learn in a few months; it takes years to reach the highest pinnacle. If we are to stop the drain on employees, the Government must say what it intends to do. Now is the time for big and bold decisions on the part of this Government, but we know that when the Government has been called upon to make big and bold decisions in the past, it has always bucked at the barrier. I am very much afraid it is doing so in relation to this question.

A great deal of uninformed criticism has been levelled at the aircraft industry by people who would have all the work done overseas, people who think that nothing pood can come from our own factories. They say that because it costs more to build an aircraft in this country, we should buy aircraft oveseas and let our aircraft industry go out of existence. I suggest to the Government that it is difficult for the Australian aircraft industry to keep its costs down because of the circumstances surrounding production.

The aircraft industry wants to spread out its work on a peace-time basis in order to achieve the best economic results. It could keep prices down if it did that. On the other hand, the Air Force - and 1 can understand its point 'of view - when it determines what equipment it wants, requires it as quickly as possible. Because of that, the aircraft industry has to speed up its methods of production, with the result that costs jump considerably. The R.A.A.F. wants the equipment aS quickly 'as possible.

It is riot concerned about what happens to the 'industry between orders. It is not the job of the R.A.A.F. to worry about what happens to the aircraft industry between orders, but it i's the job of the Government, In addition, military requirements for modifications to the original specification introduced into the production line of the Commonwealth Aircraft Corporation arid the Division of Aircraft Production, though laudable as military objectives, are a delaying factor in the construction of aircraft in this country. They are also very costly. It seems to me that we 'must expect in the aircraft industry a process of boom and recession. You come up to a peak of production, you go down into the valley for a couple of years, and then you come up again. It is a case of up and down alternately. Therefore, the Government should give very serious consideration to achieving some degree of stability in the aircraft industry.

A suggestion has been made by the Commonwealth Aircraft Corporation. Everybody knows that the directors of that organization are men who have proved themselves to be very successful in many sections of industry. They suggest that when the Commonwealth Aircraft Corporation is npt required to make military aircraft, it should be given an opportunity to provide civilian aircraft of the DC3 standard. At the present time there are more than 70 DC3's in Australia, used on feeder services to the main airlines. They usually carry only about ten or fourteen passengers. Those aircraft are wearing out. The Commonwealth Aircraft Corporation has suggested that it provide aircraft to take the Place of these DC3's which are fast becoming obsolete and are not in a fit state to take the air. I suggest that the Government give very serious consideration to the suggestion that the aircraft industry be given an oppor tunity for steady development, riot dependent upon defence uncertainty.

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