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Thursday, 16 May 1968


Mr LUCHETTI (Macquarie) - The Minister for National Development (Mr Fairbairn) has made a disappointing and unconvincing reply to the honourable member for Cunningham (Mr Connor), who has charged the Government with permitting an increase in the price of petrol in Australia. When the Minister gave the reason for the increase in the price of petrol in his reply to a question in the Parliament on 7th May he referred to the finding of vast quantities of oil in the Bass Strait area of the continental shelf. Today the honourable member for Cunningham has brought home clearly and strongly the Labour Parry's point of view on this matter. It also represents the point of view of the members of the Australian community who, as a result of this Government's policy will find themselves paying more for petrol and petroleum products. The Minister did not attempt to answer the case presented by the honourable member for Cunningham. He skirted round the matter. Like the honourable member for North Sydney (Mr Graham) the Minister would rather go back into history and refer to the days of petrol rationing than deal with the question of why the finding of a substantial quantity of oil in Australia, which should add to our wealth, should not result in a reduction in the price of petrol to the Australian people.

What is the position? According to Dr Alex Hunter, the price of our oil will be increased and air fares will rise. Petrol prices could rise to the extent of 5c per gallon, despite the fact the Minister said that over the next few months petrol prices could rise, on the average, by 1.7c per gallon. In any case, it has been made clear that the price of petrol will be dearer. Let us look at the facts. Why should this be so? It can be justified only because the Australian people are perhaps the most cheerful givers. They are the champion givers. They give the highest price for oil found in Australia. They give the longest term leases. They give the biggest areas - in fact, nine graticular blocks to 25 square miles. They pay the highest royalty for oil discoveries and give the greatest and most substantial assistance. In every way the Australian Government is prepared to give and give to the oil companies without concern to the Australian community.

I was astonished, whilst the honourable member for Cunningham and my colleague from Hindmarsh (Mr Clyde Cameron) were speaking, to hear interjections from members of the Country Party respecting this matter. One would have thought that the Country Party would have been on the side of the Australian Labour Party in this instance because the Country Party is concerned with the man on the land and the small man using his lorry, his car or his other vehicles to take his produce to the market at the nearest town. The small man is involved in questions of development and of cost of transportation. But the community will pay. The increased price of petrol will add to the staggering burden being borne today by transport industries in this country. According to the Commonwealth statistical services, for the 12 months ended 30th June 1967 not less than $223,672,000 was levied in net customs and excise duties collected on motor spirit. To that staggering burden being borne by transport industries in Australia there will be added the increased cost of the price of petrol.

What does Australia do about this state of affairs? Is this price increase justified? The Minister for National Development did not answer that question. He did not attempt to answer it. Surely it is the responsibility of the Minister who speaks for the Government in these matters to justify this price increase. Australia gives aid to the exploiters by subsidies for drilling, tax concessions, graticular blocks and by assistance through the Bureau of Mineral Resources. We guarantee the exploiters and help them with subsidies and price advantage. When it is all worked out, the cost of oil from Bass Strait landed at the refinery gate will be approximately $1.20 per barrel. But this Government which is concerned not wilh the struggling factory, the struggling farmer, the struggling community or the struggling pensioner who may own a car, will allow these struggling oil producers, about whom the Government is concerned, to charge $3.50 per barrel. This is the sort of plan that we have from the Government at the present time. We are told that we have need of all these concessions. But what special costs have oil companies exploring in Australia to face that are not faced by oil companies producing oil overseas?

The Minister for National Development in the course of his remarks spoke of the added problems overseas. He referred to over-drilling because graticular blocks schemes which are adopted in Australia are not adopted overseas. Oil companies operating overseas in the main pay higher royalties. They do not get subsidies. They do not receive taxation concessions. They must pay shipping costs for large tankers to bring oil from the Middle East around South Africa to Australia. So it is that the costs are great for oil and petrol from overseas. What new element comes into this matter that causes the cost of oil produced in Australia to be so much higher that the Government should be taxing the Australian people to give assistance to Esso-BHP? This organisation has done so amazingly well. It has stimulated the Australian stock market with its prospects of success. Why should we be giving such organisations permission to increase the price of petrol whilst loading the additional cost on to the poor people in the community? According to the 'Australian Financial Review' of 14th November last year, those to profit as the result of these discoveries will be: Mr Lewis Weeks to the value of $5. 3m per year; the Federal Government with its subsidies and its royalties of $8.5m per year; the Victorian Government to the extent of $ 15m per year; while Esso and BHP will have takes of $35m each. So it is that these companies which will be doing so well out of their discoveries have stimulated the stock exchange.

Sitting suspended from 12.45 to 2.15 p.m.


Mr LUCHETTI - Mr R.N. Irwin, the President of the Automobile Association of Australia, in a recent publication is reported to have said:

.   . surely it is a paradox that, according to Press reports, greatly increased estimates of future local production of crude oil could mean an increase in retail petrol prices.

The unhappy truth is that the more oil we get in Australia the dearer will become the price of petrol to the Australian consumer. The Opposition believes that a fuel policy should benefit all. The Government has adopted not a national policy but a sectional policy. The exploiters of our latent wealth are not disadvantaged in Australia; they have many advantages. The Minister has outlined these advantages on numerous occasions. Royalties paid in this country are not as high or as large as those paid by oil companies in other parts of the world. We have to be realistic; we have to be fair and just to the Australian community. The Australian people should not be called upon to pay excessive prices for petrol and oil to make Esso-BHP shareholders richer.

The Minister has been at pains to try to make out a case for the increased price of petrol to Australian consumers. But let us look at the 'Australian Financial Review' of 14th November last year. Under the heading 'Dizziest five minutes listed BHP to $2,270m' these words appear:

In their dizziest 3 minutes in years, Australian sharemarkets yesterday increased their valuation of the Broken Hill Proprietary Company by some (206m to &270m.

That was because of the Broken Hill Proprietary Company's share in the offshore exploitation of oil in Bass Strait. This is what the public has to pay for. Is this the struggling company that needs financial support from farmers, producers and the ordinary people of this country? Surely not.

Mr SPEAKER (Hon. W. I. Aston)Order!The honourable member's time has expired.







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