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Thursday, 20 April 1972
Page: 1920

Dear Sir,

Thank you for your letter about my rates. At the present i am unable to pay anything off my rates. All my wool proceeds are going to the wool firm which is providing carry-on only. The bank will not provide any carry-on at all. i propose to make a further application to the Rural Assistance Board.

That letter was addressed to the shire clerk. What is happening now is that the debt structure of primary producers has been transferred over the years from traditional banking institutions to pastoral finance companies and hire purchase firms and now, from those sources, to local government which has, to quote another shire clerk, 'neither the resources nor the ability to counteract such an erosion of its financial position*. So against this background of 2 loudly trumpeted Government measures we can examine the Government's major scheme - the rural reconstruction scheme. The scheme was badly based right from the beginning. The sum of $100m was to be spread over 6 States and 4 years. The Commonwealth insisted on doubling the rural reconstruction interest rates which had prevailed in New South Wales for a whole generation. It insisted on reducing the 30-year limit which had prevailed for that time to a 20- year maximum for repayments. It insisted on receiving the whole of its money back from the States at high interest.

The Commonwealth was bent on making (money out of rural hardship. The Commonwealth also dictated how the money should be spent. It ignored a generation of experience in New South Wales and told that State, and all other States, that half only would be available for debt adjustment and half would have to go to farm build-up. The Commonwealth ignored protests about this. It ignored State protests that the money Was being released in an inadequate way. The Commonwealth Government and the Minister ignored the Victorian Minister who said that the scheme was a disaster, and the New South Wales Minister who repeatedly said he was out of money and the scheme was stalled.

When I raised this in the Parliament the Minister for Primary Industry denied it all and indicated that he had solved the problem and told me to be quiet. In the end he had to admit that he was wrong, the Federal Government was wrong and the scheme had broken down. It took 3 meetings of Federal and State Ministers and officials to reach some kind of agreement to get it going again. The Commonwealth was dictating and insensitive to such a degree that the conferences were bitter and one Minister threatened to walk out and go home. I do not blame him, because he had assessed his State's urgent additional needs at $10m and he was offered only one-fifth of that sum.

The end results of the conferences have been announced by the Minister and we are debating his statement on them tonight. Let us see what the Government agreed to. Firstly, it refused to approve the needs as put forward by the States, which are doing the work and know the problems. Secondly, it refused a request by the States that repayment obligations to the Commonwealth be liberalised. It agreed to allow the States to spend the balance of their allocation over 2 years instead of 4 years. In fact one-half of the money had been spent in one year and the scheme had stalled so there was nothing else he could do. The Government agreed to go back to the original limit of 30 years for repayment instead of 20 years, but only for build-up. So it is still tougher in New South Wales than it has been for 30 years. Then the Government agreed to find an additional $15m for allocation between 6 States over 3 years and tried to insist on earmarking one-half of that sum for farm build-up. If it is, the additional finance for an entire State in a single year could be $700,000. How generous this is. The Commonwealth spends more than that each year on the ink that is spilled on its mountains of paper.

The Minister made another claim about this reconstruction scheme. He said:

The new funds now provided by the Commonwealth will ensure continuity in the job readjustment in agriculture.

This must be a reference to the resettlement loans. What a tragic fraud. There were only 2 dozen applications from all over Australia. In one State only 2 applicants received approval, and one of them got' a resettlement loan of $500 after losing his farm. The rural retraining scheme is even worse. In the whole of the Riverina there has been only one applicant, who was offered $57 for himself and his family of 4 over 3 years towards a retraining course. This case is the subject of a question on notice that remains unanswered after some, weeks. This is the record. This is the performance. Yet the Minister told Parliament:

The reconstruction scheme has already established itself as a worthwhile catalyst towards renewed viability in primary industry.

ThU miserably inadequate performance satisfied the Government and its Ministers, but it has not satisfied the countryside. Mr Noel Hogan, the national president of the Fanners Union of Australia, told tha

Government bluntly and firmly the other day that S300m is needed on the basis of low interest and long term finance. The local government bodies have told the Minister in deputation that the amount made available for rural assistance is totally inadequate. The Western Division Group of the Shires Association of New South Wales told the Minister that the cost of servicing loans is now prohibitive and that over the whole State only one applicant in 3 or 4 has been able to get help from rural reconstruction and that only one in 5 applicants from the western division of New South Wales has received any help. The Group told the Minister also that interest rates of 4 per cent for debt adjustment and 6i per cent for build-up are far too high, and produced evidence that 90 per cent of the wool subsidy in some areas has gone to banks and pastoral finance companies and not to growers.

The Minister was told of an efficient producer who was a victim of the anomalies and inadequacies of a series of government schemes. He was advised that he was too wealthy to apply for drought relief money and ineligible for wool relief grants because his income had not fallen by 8 per cent in the required period as he had used credit to re-stock after the drought. The administrators of the scheme disregarded his bigger debts and bigger commitments, simply taking into account paper income from wool from sheep he had bought on tick. Then along came the Government's assistance to the wool industry by guaranteeing 36c per lb. This grower missed out again. He found that his money was held by the wool firm, so he applied for rural reconstruction assistance. This was his last hope. In spite of 40 years of work in the industry and his proven record, he has again missed out.

This is the story of the Government's measures in the countryside. They are narrow and inadequate, and designed to promote the Government's programme of get big or get out'. The Prime Munster has made the Government's policy clear. He said that 18,000 wool growers have to get out of the industry. This means an exodus of 100,000 people from the countryside. The Prime Minister announced it. It is policy. lit is being implemented. It is not long since I stood in this House and asked the Minister for Primary Industry to investigate the plight of 600 closer settlement lessees in New South Wales. They have revolted and simply told the New South Wales Government that they cannot pay 5 per cent on their leases, the charge insisted upon by the New South Wales Minister for Lands who, when in opposition, said that if the charge was more than 2i per cent the scheme would fail. I asked the Minister for Primary Industry to investigate the situation and the revolt by 3,000 irrigators against increased government charges for water. I wanted the Minister to understand the problems of the countryside. He should have task forces going into trouble areas to get information on the measure of help needed. He will not believe the States or heed the farmers. Perhaps he accepts what is said by the Prime Minister and agrees with the reduction proposed of the rural sector.

I reject the Minister's reference to the horticultural industry as completely inadequate. I remind him that the canned fruits industry in Australia was initiated and encouraged by government, and that growers in my area have been following to the letter government advice on what to plant and how much of it. They are now being penalised for following government advice and government directives. The Federal Government has a direct and clear responsibility to the canned fruits industry. It brought it into being under the umbrella of the Ottowa Imperial Trade Agreements of 1932 and it cannot now abandon the infant that it brought into the world. If the industry is in trouble it is because the Federal Government has vacillated over 10 years following Britain's announced intention to enter the European Common Market. It still has not spelled out a policy for the future. It still has not made alternative treaty and preference arrangements. AH that the Government has done is to talk about over-production - that term was used in the Minister's statement - as if the industry was responsible for all the ills. But the responsibility is the Government's. If it acts and gives leadership, the growers will respond.

Finally, I want to pin the Minister down on a subject that he has so far avoided. There was discussion at the CommonwealthState meetings about the future of the studs. The New South Wales Sheep Breeders Association and State agencies have asked for special assistance for the nation's studs. Many of the studs are sunk in crisis and face extinction. If they go and the valuable genetic material is dispersed, it could take 20 years to reassemble these powerhouses in the development of the Wool industry. It has been estimated that $10m will be needed to stabilise the stud (industry and to help sheep producers to maintain a high standard. The Government should help producers to get good sound nock rams. This would assist the industry generally. It is doubtful if more than 100,000 flock rams were bought in this ram-selling season over the whole of Australia. The average price was under $30 a ram. If we are to throw flock improvement to the winds, then we will return to the kind of unimproved merinos which still graze in Camden as historic relics of the past. That sort of animal will return to haunt us in the future.

Incomes have been reduced by one-third in 2 years of rural recession and prospects are labelled 'very doubtful' for the future. We cannot afford this. The answer in rural reconstruction is clear. The countryside needs confidence and credit. The Government should reject the McMahon doctrine of wholesale removals. The Minister should find his courage and rebel against this inept concept by his inept leader. The producers do not want handouts; they do not want to wait for bankruptcy. They want to know that the nation needs them and will stand by them. They want an injection of confidence which they do not get from statements by the Prime Minister that 18,000 of them will have to leave the industry. Every member on the Government side sat silent and did not even challenge that statement.

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