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Tuesday, 14 May 1968

Mr HALLETT (Canning) - Mr Deputy Speaker,the honourable member for Corio (Mr Scholes) seemed to be concerned, from the beginning of his speech, about the continued drift of population from country areas to city areas. This is a real problem. May I suggest to the honourable member that more positive thinking is needed if this trend is to be arrested in the future. Perhaps one of the things to do would be to give us support in the forthcoming redistribution so that representation of areas beyond city boundaries will not be depleted. If this drift continues and all the representation in parliament is taken from country areas and given to the cities of Australia the effect will be calamatous.

In the balance of his speech, the honourable member indicated the effect on Geelong that the drought had had. This is very true. It is only an extension of what might happen and what could happen if we do not safeguard the industries within our country areas. Those industries should be safeguarded. It is obvious from the drought situation which we have been experiencing that industry is affected by the conditions. Drought will continue to affect industries for some time to come. Thank goodness the rain that we have known in the last week or so has come. But this rain is not the end of the drought. The country must recuperate from the present state of affairs. We must rebuild and our industries must come back into production again. It will be some time before production increases and this revival is felt by city areas in the production lines. This is a real problem. I endorse the remarks that the honourable member for Corio has made. This is one problem about which we must think seriously and adopt appropriate remedies.

On the last occasion when a Commonwealth Aid Roads Bill was before this House, we had an influx of mayors from, I think, all cities of Australia. The mayors came to Canberra to bring pressure to bear on the Government to give their cities a greater proportion of the financial cake. Here again we see evidence of the application of pressures from our cities to take from country areas money that is meant to build roads on a national basis right across the face of this country and is not intended to build so many monstrosities such as the steel and concrete overways, underways and what-have-you within our city areas. That kind of work really does not get us anywhere. One has only to look at some of the leading cities in the world to find examples of what I mean. Just how high these overways will go, I do not know. They are rising many stories high at the moment. Obviously, this state of affairs cannot continue. We must spread out and use some of the 3 million square miles that we have. I hope that when the Commonwealth Aid Roads Bill next comes before the House it will receive the support of the honourable member for Corio.

Mr Deputy Speaker,the four Bills before the House make provision for the future. Tremendous pressures are always put on any Government for many things. One of the matters to be considered for the next Budget will be social services. I think that Australia, even though it has suffered the ravages of drought, is a country that enjoys a high standard of living and can afford t'o look after its elderly folk. I do believe that serious consideration must be given to helping to some greater extent many of the people in our community - for instance, invalids - who have no support other than their pension. I hope that the Treasurer (Mr McMahon) and the Government as a whole will sympathetically consider their plight. The Government does assist them in many ways. The homes for the aged scheme, I believe, has been a tremendous success. It is meeting with support all over Australia. It represents a real effort to make a better world for some of our aged people. We can afford to do this. I really believe that. I feel that we should be looking at the subject of social services somewhat more closely in the next Budget.

Before I move on to other matters, may 1 refer to the tremendous growth rate that we have seen in the last few years in my State, Western Australia. With this growth, of course, come some problems. It is just as well that we have seen this growth rate. The repercussions of it have been borne not in a large measure by government expenditure but more particularly by private expenditure. Private money has gone into this tremendous development in primary industries and secondary industries, but mainly in primary industries. I refer to agricutlure in the true sense and also to mining development. But this growth has brought pressures to bear on the economy of Western Australia. Those pressures have been felt in one field mainly. This is the housing field which, I think, needs attention.

The State Government itself cannot handle the problem although it is endeavouring to do so. Indeed, this matter does need attention from the Commonwealth. I believe that a case exists - I understand it has been proposed now by Western Australia - for additional assistance. I feel, and I think the Government of Western Australia also feels, that we require and can absorb many more migrants in our State. But the limiting factor in this regard is housing. If Western Australia is to continue this development and if it is to continue the export' drive which, when looked at, is seen to be of tremendous importance to Australia as a whole, which will need more of this development in the next few years in view of its balance of payments situation, I feel that the Commonwealth must look to Western Australia and assist it to a greater extent than it has so far. It must assist Western Australia to house the migrants and provide associated requirements, such as schools and hospitals.

This assistance is not being asked for without some real purpose. We can see the achievements which have been accomplished. But no State, I believe, can expand on its own resources at the rate that Western Australia has been expanding. Western Australia has been doing this very effectively but the time has come, I think, when we must look seriously at the situation there. The price of homes and the price of land that is offering are moving up. The price of land certainly is rising far too rapidly in some areas. I do feel that it is a State responsibility to do something about this matter, but having done something about it, the State still must build the homes that are required, whether they be in the country or in the industrial areas adjacent to the city of Perth. This problem is to be found in my own electorate. A very important machinery industry has developed in my electorate from the ground upwards. It began in a small way. The limiting factor in its development now is housing. This, I think, is the subject about which the honourable member for Corio was talking. Decentralisation is necessary. In the case I have just quoted decentralisation is operating but housing is a limiting factor. This is the reason why tonight I bring this matter forward in the House in the hope that the Commonwealth Government will give consideration to it.

The main matter that I wish to mention tonight is a problem that we find in the primary industries. In many areas this problem is becoming rather serious. The problem can be staved off for some time by improvements in production techniques and all sorts of things, but a point in time comes when pressures become great. The Government has a policy of protection for secondary industry. I am not going to argue about the wisdom of this policy. It has assisted to develop Australia. We have developed Australia in no uncertain fashion. Secondary industry needs protection. But once a manufactured article comes off the production line it is subject to pressures from outside. This situation is not unusual in the world. It is not unique to Australia. Protection is offered in various countries to their industries. In many cases the degree of protection is far greater than it is in Australia.

We have had recently the episode concerning motor cars imported from Japan into Australia. Here, protection is offered to the Australian motor car industry. But let us try to reverse this situation by exporting motor cars to Japan and see how far we get. I do not believe that we are able to do this. I do not believe that with all the protection in the world - protection that we need - we would be in a position to export cars to Japan. This is understandable. It is Japan's business. We cannot argue about it. This is the type of protection that some countries give to their industries.

We also have in the Australian scene, shall I say, the protection of wage and salary earners. In other words, we have the arbitration system which is machinery set up to protect wage and salary earners and to see they get a fair return for their labour. This is fair enough, too. Although our arbitration system may have its ups and downs and need some adjustments from time to time, as an independent authority it does listen to both sides of an argument and make the adjustments that it considers to be necessary. When we get to the primary industries we see a different picture altogether. In this modern age we must look very seriously at the situation. On the one hand costs are forced up because of the policies I have mentioned. The Government has from time to time introduced legislation to protect the primary industries against rising costs. We have, for instance, taxation concessions, fertiliser subsidies and fuel equalisation measures which reduce the cost of fuel to certain people in country areas. But this assistance is not keeping pace with the general increase of costs.

The price of many commodities has deteriorated. This has been most evident with the commodities that are sold overseas. Sugar and wool are in real trouble. Perhaps we could argue about the method of marketing wool, but it is not my intention to do so tonight. The basic fact is that the wool industry is in real trouble. I should like to quote a passage from the Quarterly Review of Agricultural Economics. It states the position fairly well in these terms:

The combined effect of the various changes in production and prices is an expected reduction of between 11% and 12% in the gross value of rural production to $3, 373m from $3,821m in the previous year. Farm costs, on the other hand, have continued upwards, rising by an estimated $100m with the result that farm income is expected to fall from $ 1,401m in 1966-67 to $853m, the lowest for a decade.

The volume of exports of rural origin in 1967- 68 will probably fall by no more than 2%, despite the effects of the adverse seasonal conditions on the volume of rural production.

So actual total production has not dropped by a great amount. However, the cost-price squeeze has placed the farm industries in a predicament. The Quarterly Review of Agricultural Economics also stated:

Prices for farm inputs rose relatively slowly during the early years of the 1960s, but since 1963-64 the index of prices paid by farmers has increased by amounts ranging from 21% to 5% a year, and this trend is expected to continue through 1967-68 with a rise of nearly 4%.

The principal increases are in wages (5i%), local government rates (91%), fuel (9%) and fertiliser (5%), with smaller increases in machinery and spares, building materials and freight.

When these percentage rises are related to falling income, it is obvious that something will bust if we do not look at these points much more closely than we have.

We must protect the secondary industries to provide employment for our people and to keep our immigration programme going.

But if we continue to protect our secondary industries and our wage and salary earners, surely we must balance this by protecting our primary industries. This is the only way that the primary industries will be able to stay solvent. Surely these great industries which have held Australia together for so long will still maintain their position as our greatest export earners. This is very important, especially when we consider our balance of payments. If we neglect these industries and if we let the farmers and the young people who are trained in farming drift to the cities, as the honourable member for Corio said, we will lose the best of our stockmen, the best of our engineers, who do the work in this mechanised age, and others engaged in the primary industries. Then we will see a rapid fall in production. Nothing is surer, unless we protect the primary industries.

I mentioned some of the measures that have been adopted to assist primary industries. The cost of fertiliser has risen by 5%. The present subsidy on fertilisers is assisting primary industries and is the means of increasing production. It helps to keep down costs. But the subsidy was given some years ago and has not been increased since. These are the matters at which we should be looking when we seek to protect primary industries against rising costs. The primary industries cannot possibly absorb all the increases and I cannot stand by and see them decay. If we are not careful we will not really be farming but we will start to mine our soil. Surely we have seen enough evidence of this in other countries, which have permitted the soil to be mined and have finished with a dust bowl. This can happen in Australia, because the only way a farmer here can meet his commitments is to get more and more from his soil. He crops more often, and so on. What we want to do is to build our soils and to protect them. We can do this only if we have a sound economy on which our agricultural industries are based.

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