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Thursday, 27 April 1972
Page: 2160

Mr SINCLAIR (New England) (Minister for Primary Industry) - in reply - Generally in this debate tonight there has been a recognition of the kinds of change that face the dairy industry and the efforts that these Bills represent in meeting them. There are difficulties associated with trying to ensure, in the formulation of the 2-price quota scheme, that those in the industry get State backing at this stage of the proposal. It was pointed out correctly tonight that that scheme originated in the McCarthy report. It has been suggested that at this stage there are some details of the scheme which have not been adequately identified. I would point out to the honourable member for McMillan (Mr Buchanan), who sought certain details, that I wrote a letter to him, dated 29th March, setting out full details from the point of view of the Australian Dairy Industry Council. To save time tonight I will not read those details but I point out to any honourable member who seeks them that they are readily available from the AIDC or myself.

In essence, the present rate of progress on the implementation of the 2-price quota scheme depends upon the consultations which are taking place in order to determine an administerative framework. This framework, of course, is not for the Commonwealth Parliament alone to consider but for it and the State parliaments to consider and then to implement. At the official level we are in the process of trying to get an agreed basis for a restraint control mechanism. I believe that the AIDC 2- price quota scheme is the best base from which any such mechanism can be implemented. Some reservations have been expressed by the Victorian Minister responsible. We are endeavouring to come to a mutually acceptable base for the administrative framework. I would emphasise, as I did in my second reading speech, that I see the implementation of some type of restraint mechanism, when it is necessary, as absolutely critical to the rational organisation of production geared to available markets in the future. Already some suggestion has been made by the honourable member for Dawson (Dr Patterson) about the application of section 96 grants. There are ways in which it might be possible to apply funds selectively in order to ensure that those who are prepared to subscribe to some type of restraint mechanism can be assisted and that those who are not so prepared, or those States which have no such mechanism, can be distinguished against. At this stage I do not believe that type of a financial constraint to be necessary. I have in fact received undertakings from all governments that they are prepared to implement a scheme when it is proved necessary. Some honourble members have suggested in the debate that they believe that perhaps the Government is being too pessimistic in its forward projections. The honourable member for Dawson and I in fact concur in the difficulties which could well arise in the future. I am afraid that I find it hard to see the future for the industry other than one in which it must relate its volume of production to the available markets which will fluctuate and which, regrettably, will be dependent not only on the marketing effort that is taken by the Australian dairy industry but also on a marketing effort influenced substantially by the considerable stocks which in the past have been built up by countries such as those in the European Economic Community.

Particular points have been raised in relation to some areas in these Bills. I do not want to go into the question of transferable quotas. As I say, the details of the actual provision of the restraint mechanism necessarily will come before this Parliament in legislative form before they are implemented. At that time I will be prepared to talk on this matter. I personally would hope that although there is to be at this stage a State quota if the ADIC proposal is implemented there will be a transferability or a negotiability of quotas within the States and perhaps it might be possible - certainly technically it will not be impossible - for such transfers to occur interstate as well. The basis of their implementation is, as I say, still the subject of negotiation with the States. For that reason I do not wish tonight to canvass the ways in which it could best be implemented. But I do believe that there is in the long term interests of restoring profitability to dairy farmers a significant interest in ensuring that there should be some type of restraint control mechanism available.

I disagree with the suggestion that was put forward that the Government is pursuing a policy of destroying the profitability in dairy farms - of economic nihilism, as I think it was defined. Indeed, our policy is to ensure that within the rural community those people who operate will operate profitably. There have been tremendous problems for some people in the dairy industry. The honourable member for Dawson referred in particular to those in Queensland and those in northern New South Wales who have been operating on marginal returns, many of them below subsistence level, for many years. The dairy farm build-up scheme was designed to help those farmers so that they could get into a position of profitability relatively equal to that of those in other professions or trades or employment in the community. I believe that the movement out of the industry has been something of an adjustment which has helped towards the achievement of that objective. It certainly is not the Government's desire to drive farmers out of business. The Government's objective is to ensure that those who are in the business of farming are able to operate profitably.

The suggestion has also been made that there is a necessity that the results of research be made available more widely. This is a philosophy with which I would agree, not only with respect to dairying but also with respect to every other sphere of research. It is unfortunately true that many valuable pieces of information are locked away in pigeon holes around the countryside. How to translate them from those pigeon holes into practical application is a challenge which extension services of Commonwealth and State governments have been pursuing. The Commonwealth extension service grant, of course, recently has been enlarged. The additional funds going to State advisory services are designed to help in the propagation of information relating to these research activities. I might add that the enlargement of the research scheme which these Bills envisage will increase the ability of the Dairy Produce Research Committee to ensure that findings are applied as speedily as they can be tested. I believe that this Dairy Produce Research Committee in its new role will be able to achieve its objective to a greater degree than it could before.

Mr Deputy Speaker,the Bills in fact repeat substantially, as the honourable member for McMillan has said, the sorts of measures which were first introduced a long time ago, but they are not the same measures. These are measures which are introduced in a changing world marketing situation. They are measures introduced in the light of undertakings given about the ADIC 2-price control mechanism, and they are introduced with a cognisance that, trying to look into the crystal ball, there are still ahead significant problems in determining just how profitability of dairy farmers can best be assured. We believe that the guarantees that are given through the stabilisation scheme provide a sound base. We see beyond that in the ADIC or other production control mechanism that assistance can be provided which will help to achieve that objective of profitability. In closing, I thank the honourable member for Dawson for permitting a cognate debate on all of these Bills which I see as being essentially related to the same objective. I commend the Bills to the House.

Question resolved in the affirmative.

Bill read a second time.

Message from Governor-General recommending appropriation announced.

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