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Thursday, 1 May 1980
Page: 2071


Senator RAE (Tasmania) - I propose at a later stage in my speech to seek leave to alter the wording of my original motion by adding after 'fares' the words 'and services'. I will speak to this proposal in a moment. It has resulted from some discussions held with others interested in this matter. It will make quite clear what is intended. The Senate, although some may dispute it at times, is constitutionally intended to be, and I believe still is, a vehicle for the exercise of what is regarded by many people as States' rights. There is an opportunity for the States to use the Senate and the Senate committee procedures to ensure that matters which are relevant to the total nation but of particular concern to an individual State can be given consideration.

I think it is of some significance that the first suggestion for a select committee of this chamber in 1901 was a proposal for a select committee to look at the question of transport between Tasmania and Victoria. That was the very first select committee proposed in this chamber. It has not ceased in the succeeding 79 years to be a question of some significance, of some importance, to Tasmania. The fact, as one Minister in this chamber with such incredible perspicacity noted, is that Tasmania is an island surrounded by water. Tasmanians were very grateful for the fact that he had identified the true situation. We felt that at last we had made a major breakthrough. The Executive Government in Australia was beginning to realise that Tasmania was actually an island surrounded by water. That, of course, has certain consequences. One of the consequences is that one cannot drive to and from Tasmania, notwithstanding what has happened to fuel prices. The situation remains that the very largest percentage of people who travel in Australia travel by road. They travel in their own car, in a hired vehicle or with friends. That option is not available either to Tasmanians or to people who wish to visit Tasmania.

I do not think that I am being chauvinistic in relation to Tasmania when I say that many people regard it as living up to the slogan of the Tasmanian Tourist Bureau- 'the Treasure Island'. It is a treasure from the point of view that it has a tremendous variety of extremely attractive scenery in a small area. On the generally accepted figures tourism is probably the second most important industry. The general attitude around Australia is that Tasmania has got its tourism act together fairly well. It is a major industry to the State. It is a major attraction to the 9 million people who live less than two hours' flying time from Tasmania. In a country as large as Australia one can take an overseas trip to an island as large as Tasmania. It is 26,000 square miles in area- twice the size of Taiwan, just to give a comparison. One can fly there for a holiday which is very different. Most people say it is one of the cheapest and one of the best holidays obtainable.


Senator Chipp - Unless you go to the casino.


Senator RAE - Senator Chippmentions the casino. I will now make some comments which I would have made later. I happen to be able to say that I have no problem about the casino. I went to the casino on its opening night and played blackjack for an hour. I won $3 and I gave $1 to each of my sons as a momento of opening night. I am still $3 in front at the casino. Whilst it has been of very great importance to Tasmania I think it is a matter of personal choice whether one visits the casino. One of the interesting things is that like the Sydney Harbour Bridge in the early 1930s, like the Sydney Opera House in the 1960s, the 1970s has seen in tourism in Australia the day of the casino- the Hobart casino, the Wrest Point casino, the Tasmanian casino. Of the man made features in Australia, the Sydney Harbour Bridge, the Opera House and the casino in Hobart are the best known both in Australia and overseas. The interesting thing about tourism statistics in Tasmania since the casino has been advertised and has been made the focal point of a lot of promotion is that a gigantic number of tourists who come to Tasmania never go near the casino. The casino has assisted in the development of a convention centre. Importantly it has been promoted so that now it can be readily identified as Ayers Rock can be identified, as the Sydney Opera House can be identified and -


Senator Jessop - What about the Barossa Valley?


Senator RAE - However it is unlike the new High Court building, which people will not be able to identify as something which will attract anybody to Canberra. My colleague Senator Jessop interjects about the Barossa Valley. There is all the difference under the sun between the two. In relation to tourism, what Tasmania has to offer is that which can be complemented but not substituted by, the product of the Barossa. Fortunately we can import. In Tasmania we are developing a new and, what is likely to develop into, a great wine industry, producing very fine European-type wines. I do not imagine that it will ever produce wine in the sort of volume that will continue to be the product of the Barossa and other parts of South Australia, Victoria and New South Wales, but let nobody think Tasmania does not have a wine industry and it does not produce excellent wines. Let nobody who finds it enjoyable visiting wineries as part of a tourist trip think he will not get that opportunity in Tasmania, just as he can get it in South Australia, Victoria and New South Wales or, for that matter, Western Australia, which recently has developed its wine industry quite significantly.

Let me return to the matter of the select committee to which I referred earlier. That was the first select committee ever asked by this chamber to look into shipping between Tasmania and Victoria. In 1970 the Senate accepted a motion which I had moved. When freight rates started to go up and to become a very real problem, we referred to a Senate committee the matter of freight rates to and from Tasmania. It was as a result of that committee inquiry that the Tasmanian freight equalisation scheme evolved. That scheme resulted from the recommendations made by that Senate committee, its identification of the justice of doing something about the situation of the one State which was bearing the burden of three aspects of Commonwealth Government policy.

The Commonwealth Government had decided that it was important to preserve a shipbuilding industry in Australia. By giving subsidy and protection to that industry, what happened was that- no doubt to the delight of my colleague Senator Jessop- Whyalla was preserved, as were other shipbuilding centres. What happened to Tasmania was that it had to pay for the cost of the most expensive ships in the world. However, that was not the main problem. The main problem was that not only were they the most expensive ships to bring anything to Tasmania but also they were manned by the most expensive seamen in the world. That, again, was a matter of Commonwealth Government policy. The ships were turned around and the freight was loaded or unloaded by the most expensive waterfront in the world. Each of those three aspects were matters of Commonwealth Government policy, decided upon in the national interest and in the interests of preserving and developing our important overseas exports.

Compromises had been made, which meant that the only State which did not have the competitive alternative of land communication had to bear the brunt of the impact of three Commonwealth Government policies causing the most expensive ships, manned by the most expensive seamen and turned around and loaded by the most expensive waterfront in the world. When people occasionally say that the freight equalisation scheme provides a nice handout, some sort of subsidy, to Tasmania I start to get cross. I start to feel sorry about the fact that those people apparently have not yet reached the stage of understanding that it is not a subsidy, it is not a handout. It is compensation for the disadvantage, for the penalty, created by other legitimate Commonwealth Government policies.

My colleague Senator Jessop, who has always taken a very great interest in Whyalla, would agree that the point becomes significant when one realises that in the first year of the operation of the freight equalisation scheme for Tasmania which resulted from the Senate committee inquiry to which I referred a payment of $22m was made under that scheme in respect of people operating to and from Tasmania, whereas in that year $38m was paid out to Whyalla in shipbuilding subsidy. Yet we still wound up with the most expensive ships in the world. I give an example of what happened. A ship was to be introduced into the Tasmanian operation and the would-be owners sought tenders. The lowest tender in Australia was $ 11.1m. That would have attracted a subsidy of over $4m from the Australian taxpayer. That same ship could have been built in Korea for $3. 9m, or in Japan for $4,5m, which meant that the amount which the Tasmanian industry had to amortise in its freight costs, instead of being in excess of $7m, could have been $3. 9m.


Senator Jessop - Had it been built in Taiwan it probably could have been even $3m.


Senator RAE - It may have been less had it been built in Taiwan. The two prices I mentioned are the ones of which I am aware. What it meant was that, in order to preserve the shipbuilding industry in places such as Whyalla or Newcastle, Tasmanians- Tasmanian industry and Tasmanian people- until the introduction of the freight equalisation scheme, had been asked to bear the brunt of the subsidy which was being provided to preserve an Australian shipbuilding capacity. I do not pause to debate the question of whether that process was efficient or inefficient. I simply make the point that the freight equalisation scheme does not offer a handout, does not offer a subsidy. It provides compensation, justly deserved. Tasmania's passenger transport is provided by two means, one by air and the other by sea ferry.


Senator Chipp - Some travel by yacht.


Senator RAE - Senator Chippinterjects, legitimately and accurately, that some people travel by yacht, some even prefer to do so, when they get time.


Senator Grimes - Some walk across the water.


Senator RAE - Senator Grimesinterjects to say that some people walk across the water. We have not had a visit from Gough for quite some time, but I understand that at one stage he did walk to Tasmania. I understand also that, having visited Tasmania for the Bass by-election, he took the first plane out afterwards.

Tasmania has no road and no rail opportunity and whatever anybody may say, competition does provide some levelling influence in the rate at which costs may escalate. When the choice is between air and ferry fairly important decisions need to be made as to what sort of air service and what sort of ferry service is required. I put it in simple terms: Do people want a low cost cattletruck type of operation, or do they want something with all the frills and at a high cost? There is no way that frequency, regularity and high standards can be provided without the cost being paid. If we want something which is a bit akin to the charter-type operation in which the standard of service is relatively low in which the size and comfort of the accommodation is relatively spartan, we can expect that the cost will be low.

A variety of interests are involved in travel to and from Tasmania. One is the interest of Tasmanians wishing to visit other areas of Australia for their family holiday, for commercial reasons, or for whatever other reason it may be. There is also the inflow to Tasmania of very significant numbers of tourists. The questions which then arise are: What sort of services will best suit the majority view? What sort of services do people want for that relatively short distance which takes about 40 minutes in a DC9?

I see no reason at all why Tasmanians should not have a say in the decision-making process. I do not mean that they should make the decision but they should have an input into the decisionmaking process of the airlines and the Australian National Line. At present the ANL is considering what sort of substitute vessel for the Empress of Australia will be introduced in 1985 when it will go out of service. Should it be a ferny? Do people want something which is fast, which burns up a lot of fuel and in which people sit up and are, perhaps, uncomfortable. By having a fast service at least they would reach their destination reasonably quickly. Obviously, with increasing fuel prices a fast service will be expensive. Do people want a sea trip which they can enjoy? I am sure that my colleague, Senator Bonner, would love the chance of a sea trip in a nice cabin.


Senator Jessop - He could see the tranquil seas of Bass Strait.


Senator RAE - As Senator Jessop says, he could see the tranquil seas of Bass Strait. At times they are tranquil but, unfortunately, not always.


Senator Georges - You have the chance to get this committee and it looks as though you are going to sink it.


Senator RAE - Over the next 20 years decisions have to be taken about what type of aircraft and services can meet the needs. Decisions have to be taken in the next year about what type of ship will be provided as a substitute for the Empress of Australia. I believe that the ANL, notwithstanding the fact that it is a statutory authority, has done a tremendous job for Tasmania. It has been much maligned.


Senator Bonner - It is one of those qangos.


Senator RAE - It is another qango but it has done an excellent job. 1 have every confidence that in planning a replacement for the Empress of Australia it will apply itself as assiduously as it can to the needs of such a service. But I am sure that it would be helped by the sort of consideration which a Senate committee, obtaining evidence from submissions and public hearings, could provide. I see the creation of this committee as the opportunity for Tasmania to put its act together in relation to one of its two major needs. One of them is that its commercial life line through freight services must be preserved. The second is that it must have personal transport communication. It is important that there should be an input from the people who are involved, whether it be the tourist industry, a group of pensioners or a major industry. They should provide some input in the consideration of what sorts of services can best meet Tasmania 's needs.

Questions which have to be answered concern the relativity of a provision which involves, directly or indirectly, Commonwealth expenditure, the investment in air and sea services, the problem of the cost-time relationship, the problem of frequency and, certainty as opposed to a lower cost, whether we should adopt a cattle truck approach, a super service approach or something in between. Of all the issues which have involved people in Tasmania in comment in the past couple of years, this would be the most common one. It would have taken up as much as or more space than any other issue in the Tasmanian newspapers. It would have taken up as much air time. I am sure that Senator Tate or Senator Grimes would agree that on every talk-back radio program, almost without fail someone will talk about the issues which are encompassed in the motion before the Senate tonight. In no way does it involve a conflict with the national air fares inquiry which has been set up by the Minister for Transport, Mr Hunt, to look at air fares. It relates to what services are appropriate to the one State to which considerations apply different from those which apply to the rest of the States. I have not moved the motion with a view to imposing any service or cost on the rest of Australia. I wish to use the vehicle of a Senate committee to gather evidence to provide an input to those who eventually will make the decisions in relation to the provision of those services.

I hope the Committee will be able to be involved in other things of some relevance such as the development of international links. The proposed link between Hobart and Christchurch in New Zealand is a matter which has been pursued for five years by various people in Tasmania to the stage where an early announcement is expected. There are various direct interstate links which avoid the extra cost of the flag fall rate. As we all know whenever an aircraft lands, turns around and takes off again a tremendous extra cost is imposed over and above the cost the aircraft would have incurred had it been able to fly directly from A to B instead of stopping off at C on the way. Such direct services as the Tasmania to Coolangatta service, the Tasmania to Sydney service and the Tasmania to Adelaide service which was tried for a little while last year have all proved beneficial and have reduced costs. These are services which we can explore usefully to find out to what extent they can be developed, how many services are required, what the demand will be and what savings there will be.

Many questions are involved. I certainly do not want to do what Senator Georges suggested I might be doing. I trust that the Senate will support the establishment of a small select committee, to use the select committee procedure, to enable Tasmanians to find out what is the majority view about what will best serve Tasmania's interest as a State of the Commonwealth in linking it with the remainder of the Commonwealth. The Committee should be able to present a report which can identify to government, to the ANL and to the airlines what questions have been brought out as a result of a public inquiry using what I believe is one of the most important mechanisms available to any of us as members of this chamber, that is, the Senate committee system. I hope the Senate will support the idea. I seek leave to amend the motion in the manner which I foreshadowed earlier.

Leave granted.


Senator RAE - The effect of the alteration is to add after the word 'fares' the words 'and services'. As I understand it, others who are interested in the matter have agreed that the addition of those words has helped to make quite clear what the inquiry should be all about.







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