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Address to "Policy for Agriculture" Conference, Perth



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PROSPECTS AND POLICI ES

FOR

AUSTRALIAN AGRICULTURE

An address by the Minister for .Primary Industry and Deputy Leader of the Australian Country Party,

HO , J a D, AST IRONY 9

at a Conference, "Policy for Agriculture", Melville Civic Centre, Perth, 3rd A p ril, 1970.

The rural industries are an integral part of the

economic structure of.Australia. Tiet no one gloss over their importance.

They provide nearly 10% of our Gross National Product and employment for 10% of the male work force; Almost a million people live on farms. A large number of non-rural people depends on the rural industries directly or indirectly, especially in country towns.. They provide the means of settlement and development of the nation. They supply almost 9010 of our domestic needs of food and fibre. °They earn some 50 - 60% of our export earnings to service the growing needs of this country.

Earnings from minerals - much of it from this State - will continue to rise at a spectacular rate and estimates suggest that mineral exports could amount to as much as rural export income towards the end of the present decade, but the primary industries will provide the bulk of our export earnings for

some time to come, If Australia is to continue to grow, to develop, to meet all our national aspirations, then the primary industries must play their vital role. They must be kept in

existence, and on a sound footing,

The performance of our primary industries has been magnificent. Over the past decade, the rate of growth in our output has been 21 times that of North America and ! times that of Western Europe. Each member of the Australian rural work force feeds and clothes 55 to 60 people at home and abroad.

Tn the United States, often quoted as a prime example of efficient

production, the comparable figure is 45 people - three--quarters of the number supplied by the Australian farm worker. So our farm sector has moved ahead, and has established its claim of efficiency.

One of the most significant factors in agricultural policy-making is that Governments, both in Australia and overseas, have supported rural producers in their efforts to improve their incomes and raise production. These policies have led to sharp increases in production overseas, where traditional importing

countries like the U.K. and Western Europe are producing more of their ovrn requirements of food, thus reducing trading opportunities of exporting countries such as Australia, and even competing-with Australia in other markets.

These policies have involved Governments in an enormous cost to their Budgets. The cost of EEC support policies for 1969 amounted to A2,054 million and is rising at an astronomical rate.- Structural expenditures by the EEC are estimated at $A1,964 million in 1969.

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How long will the taxpayers of these countries continue to tolerate policies leading to misallocation of resources and increasingly expensive food supplies ?- Strong opposition is already being voiced to these policies, and they are being critically examined. The United States is again reviewing its farm programme. Canada has adopted a policy designed to reduce its heavy wheat stocks, offering $6 per acre for wheat land turned into summer fallow and $10 per acre for additions to perennial pasture. Canadian wheat delivery quotas for 1970-71 are to be based on total area of summer fallow and net addition to land under pasture, and not only on the area planted to wheat. The

Canadian Government has estimated that up to 22 million acres could come under this programme, involving 0100 million. This follows a voluntary reduction by farmers of five million acres in their wheat plantings in 1969. The EEC has had proposed to it a major programme of restructuring and rehabilitation , of the farm sector to save costs in support policies.

There is an increasing awareness of the comparative advantages enjoyed by Australia as a producer of foodstuffs, but exporting countries have to fight for access to markets. If they don't they will find themselves competing against one another in a few selected markets, such as Japan.

There is dynamic growth in the economies of countries of North America, Western Europe and Japan, with rising incomes leading to changes in patterns of demand. Consumers are preferring meat rather than butter, cereals and other starchy foods. The

demand for feed grains and protein meals has increased to supply the needs of expanding livestock and poultry industries. This has led to a strong impact on our beef cattle industry, and prices have risen by some $10 per 100 lb. over the past six years - a huge price increase.

Population growth in developing countries is high. Under-nutrition . is common and malnuti_tion is more widespread, with the centres of highest population being worst affected. Foreign exchange resources are limited, and these countries depend on

local production for the bulk of supplies: However, the new high-yielding varieties of wheat and rice, and good seasons, have helped tremendously in the last two years. Seasonal conditions are very significant in their impact on international markets. World wheat trade in the last 10 years expanded from 36 million

tons to 62 million tons and then fell back to 47 million tons, with variations in seasons being an important factor, although not the only one,

This variability and unpredictability of markets creates uncertainty for farmers. But I believe our rural industries have the strength and the flexibility to adjust to changing markets and conditions. There is no point in producing for producing's sake. We have to adjust to the realities of the market. This has been

done for sugar and tobacco, and the wheat industry is adjusting itself. The process is a painful one, but it has to be done. Wheat industry leaders have recognised the problem, faced up to

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the difficulties, and provided leadership for their industry. In other areas we have accepted quotas for our butter exported to the U.K., and curtailed exports of beef to the U.S. in the interests of our beef producers. We have .to face the realities of the situation so that we can gain an assured place in the

markets for these products.

Primary producers are facing difficulties. No one questions that. What we must aim for are practical, realistic and sound solutions of lasting benefit. The Government's policies have helped overcome problems in the past, and we will help the producer to face up to his problems now and in the future. Our approach has been to provide a framework within whiOh producers

can operate effectively and efficiently. We have been active in seeking markets internationally through the Trade Commissioner Service, through help to exporters, through direct government-to--government negotiations. We have sought to achieve international

arrangements to assure and secure markets at reasonable prices through bilateral trade agreements and commodity arrangements such as the International Grains Arrangement and the International Sugar Agreement. We have provided stabilisation schemes and

schemes of direct assistance for the wheat, dairy, dried vine fruit and cotton industries. When the U.K. devalued her currency we provided, and are still providing, compensation to the industries affedted. This commitment has now reached X115 million.

The cost to the Commonwealth ofdirect financial assistance to the primary industries in 1969-70 is estimated at more than $180 million.

We have recognised the importance of farm development and farm investment. We have provided improved credit facilities through the Development Bank, Term Loan Fund and the Farm Development Loan Fund. We have provided taxation concessions,

special depreciation rates, full deductability of expenditure on some capital items, averaging of incomes, carryover of losses for unlimited periods, and estate duty concessions,

But costs are rising. Our economy is growing. Because these rising costs impose a burden on the primary producer we have sought in cases to Arbitration Courts and in general economic policies to retrain cost increases. Costs are rising

almost continually in all advanced countries, and we are concerned about inflation in Australia, but Australia's performance in managing her economy compares very favourably with other countries. Over the past 12 months, prices have risen in Australia by 3.5%, in Canada by 5,1 %, France 6.8%, Germany 2. 7%,- Japan 5.6%3, New Zealand 5.7%, South Africa 2.6%, the U.K. 6.6% and the U.S. 6.1%.

But I recognise that rising costs still present problems. And the Government has recognised this by providing subsidies on input costs - on fertilisers and petroleum products. We have provided increased finance for research to enable farmers to

imp:°ove productivity to meet the challenge of increasing costs.

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Our overall policy has been aimed at achieving stability; at assisting the farmer to achieve income growth along with the rest of the odonomy; at helping farmers adjust to the changing circumstances of the rural industries. Sometimes these adjustments are difficult, but we have faced up to them in co-operation with the industries concerned.

In the case of wheat the industry, in the face of difficult problems, put to the Governments sound, courageous proposals for delivery quotas. The Coimnonweal''th has assisted with substantial finance and the States are administering

the scheme - a most difficult job.

In relation to the wool industry, attention is now being directed towards marketing. Fr om 1st July 1970 the levy for research and promotion will be reduced from 2% to 1% of gross proceeds from the sale of shorn wool and the Government's

contribution to these activities will increase from 4X14 million to an average of $27 million a year. The Commonwealth has accepted a financial commitment of some $$7.3 million a year to improve wool marketing under plans which will be implemented for the 1970-71 wool selling season. The object is to upgrade preparation and presentation of the clip, and this

should be the forerunner of a whole range of important reforms

These examples of wheat and. wool illustrate two principles of our policy. Firstly, circumstances differ in our rural industries, and each needs particular policies. Those who seek a uniform policy for all industries show that they do not understand those industries. While there are certain basic features common to all industries - such as efforts to

restrain price increases, to seek income improvements, to increase productivity - for the most part there is a need to tailor policies to the circumstances of individual industries.

The subject you asked me to discuss is "Prospects

and Policies for Australian leg ,culture". The claim is sometimes made that we in Australia do not have an agricultural policy. If this means that we do not have a piece of paper saying ... "the policy for agriculture in Australia is this.., this.., and this..." then that claim is right. Of course you can't have an agricultural policy like that, because agricultural policy must be dynamic; it

must be continually changing; it must be adaptable; it must be able to take account of many constantly changing factors. So you can't put doom on paper ign all-embracing agricultural policy.

But if you believe that an agricultural policy should be aimed at helping primary producers achieve stability; at helping them organise themselves on a sound basis; at helping them find new overseas markets, anO make those markets secure by trade agreements;if you believe

agricultural policy means helping farmers develop new products through research and extension; helping them lift production where this is warranted; providing them with access to finance on concessional terms; if you see this as agricultural policy, then we most certainly do have one.

No one would suggest, I think, that an agricultural policy could have blanket application to allindustries, or to all sections of one .industry, or to all parts of Australia. ;' This is the difficulty with primary industry. It is so diverse. It is made up of so many varying

elements, and the people engaged in it have, quite often, very diverse viers.

I do not accept the view that is frequently put forward, that the Government should take over from farmers and their industry organisations the responsi-bility for planning the production and distribution of their output. The feeling that the Government should do this is quite strong in some quarters, and indeed is quite strong in the minds of many farmers.

This has been particularly evident since the wheat industry has found itself in difficulty. I have said many times that I believe the farmer himself - as an individual and as a thinking participant in his industry organisations -is best placed to make the decisions that affect him, his farm and his industry. I know the usual rejoinder to this is that I am merely passing the buck.But I think that is too facile an answer. The matter is hot nearly so simple as that.

In the case of wheat - the industry has had the courage to impose upon itself, by its own decision, quite a severe discipline, and one which will demand a considerable sacrifice on the part of many growers, and one which has led

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to hardship in many cases. This hardship would have been much worse if the industry had not made this decision. But leaving that aside, and leaving aside the fact that the Commonwealth has no power to control production anyway, may

I ask you to consider what would have happened had'the Government imposed this discipline on the industry. What would have happened if I had said to wheatgrowers: 'You must cut your production. I am going to impose quotas on

production. I am going to tell you exaotly how much wheat you will be allowed to deliver to the silos'?

I doubt very much whether the wheatgrowers would have accepted this. They would have very smartly told me where I could go. Now, you may say: 'That's all right, but what you are saying is that by letting the industry itself carry

the odium of production controls, you have saved your own skin, and avoided all the abuse that would be hurled at the person making the decision to restrict production'. Well I don't seem to have avoided much of the abuse. And I've been getting a lot of it because wheatgrowers have been led to believe that it was me who imposed restrictions on them. But the point I'm trying to make is that there is a very

valuable psychological benefit in having primary producers accept the responsibility for making their own decisions. Even though it hurts them to have to i.3muckle down to wheat restrictions, they will do it and they are doing it, because they'lunow they must do it for their own eventual good, and because they made the decision themselves, speaking

collectively. If I had taken it upon muself to tell them to do it, I doubt very much whether they would have taken any notice of me. This would have been embarrassing for me, but what is far more important, it would have been disastrous

for the Wheat growers, their industry, their families, and their communities.

8o I'm saying that I believe, and my Party believes, and the Government believes, that the final responsibility for making decisions must come back to the farmer himself. And I don't think the vast majority of farmers objects to

this. I think farmers value their independence of action. They don't want anyone, particularly the Government, telling them how to run their affairs. And of course no one is better placed than the farmer himself to make decisions affecting his own farm. No one knows it better than he does.

But I'm not saying the Government has no responsibility in all this. Quite the opposite. Governments have very great responsibilities to help the people who make up such a vital part of the nation and its economy.

Farmers must make `heir own decisions, but they can't make the right decisions unless they have information. They must know what is happening around them; what is happening in their industry; what is happening on their home and ex-port markets; what might happen in the future. They must

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have technical advice. This is where Governments come into the picture. They have the responsibility of getting to the farmer as much information as they possibly can. We already do a great deal in this direction. Twice a year, as Chairman

of the Australian Agricultural Council, I provide very comprehensive reports on each of the primary industries. The Bureau of Agricultural Economics, which is responsible to me, is constantly engaged in continuing surveys of the various primary industries, and this information is published. The Bureau provides information on the outlook for various industries, and this information is published. I know there is a need for more of this kind of information, and it is my aim to see that it is provided.

The Government goes further than this. There is a number of committees and panels on which t1e Government is represented. These are constantly engaged in examining and assessing the situation of various industries or looking

into the problems of these industries. In addition, the Government is represented on marketing boards and, in some cases, the Chairman of the board is a Government officer or nominee. In these ways the Government works with the rural industries.

There have been claims made lately that the Government has failed to give leadership to the primary industries. There have been motions and amendments in Parliament to this effect. It has been claimed that I have failed to give

leadership in formulating agricultural policy. I sometimes wonder what I spend most of my time doing, if not that.

May I take just a few minutes to quickly run through a few of the things I have said to Australian farmers over the last few years in my efforts so guide them, to advise •them, to give them some lead in where they should be heading

in production and other fields. Let's start with wheat. A little over two years ago I told the wheat industry it had no cause for complacency; that those who believed we could sell all we grew should have been brought back to earth by

price falls in the previous eight or nine months. No one took any notice of me at the time, but I did give this warning. That was in March 1968 in Melbourne. In August that year I told the Australian Wool Growers and Graziers'

Council that if wheat production expanded too much and a similar trend occurred in other producing countries we could find ourselves with a world surplus of wheat and large unsaleable stocks in Australia, In October 1968 1 told Victorian wheatgrowers that the attitude of their industry leaders in that State in resisting the stabilisation pro-posals then being discussed could jeopardise the existence of the Australian Wheat Board and the existence of an orderly marketing system that was of paramount importance to the wheat industry. At the same time I again warned of the dangers of further increases in stock-holdings.

Later that month -- October 1968 - I told growers at

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Warracknabeal in Victoria that we had a tremendous upsurge in production, and sales prospects were not encouraging. And I told them it was going to be extremely difficult to maintain the first advance at $1.10 per bushel because they would be flat out paying it back to the Reserve Bank within

the stipulated period of 12 months. I said the same things at the A.P.P.U. Federal Conference in Canberra later in October.

Mr. Chairman, I don't want to ipose on your patience by continuing to read all the references I have set out in my paper. Perhaps it is sufficient for me to say that there is a very long list of occasions on which I have spoken

to the wheat industry about production levels, sales prospects, the financial burdens the industry was undertaking, the problems of storage in both the physical and-financial senses, and so on. These references will appear in the text of my address which will be available later, so I won't read them

to you now. I just want to make the point that there has been no lack of effort on my part to guide, advise and lead the wheat industry in association with its own organisation leaders. -

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On 4th November, 1968, I announced that the first advance would be maintained at $1.10 per bushel. But I heavily qualified my statement, saying there were special considerations such as drought, indebtedness and so on,

and that growers couldn't tale $1.10 for granted in future years. And I went through all the reasons why the industry must be very careful about production. On 26th November I said it would be impossible to pay a first advance of $1.10 if there were a big carryover and. another big harvest in 1969. On 5th December I came to Perth for a meeting at Perry Lakes Stadium. I told the 3,000 people who turned up

that, not only would it be impossible for the Government to consider $1.10 9 but they wouldn't have a hope of getting their wheat into the silos anyway is they produced too much.

Then we entered 1969, and I was invited to open the Wimmera Machinery Field Days in Victoria -- on 4th March. I said there that I had been asked many times to state the Government's attitude to wheat production. I thought I had already given some pretty strong hints of the Govern-ment's attitude, but apparently some stronger words were needed. So I said, firstly, that I did not intend, and

the Government did not intend, to tell growers how much wheat to grow. And I told them the Government had no power to control production anyway. But then I went on to say that I hoped the industry would work out some means of solving the problem of mounting production. And I

offered to make myself available, if asked by the States, to try to co-ordinate a uniform national policy. I did not actually say 'cut your production", but if people didn't get that impression from what I did say they must have been pretty slow on the uptake.

On the 10th April I said growers should gear their thinking to the possibility that the delivery quotas scheme, which by that time the Australian l heatgrowerst Federation had put forward, would come into effect for the imminent

season. Further, I said that even if it didn't come into effect, it would be hard to store the amount of wheat suggested by the Federation for quota, production, and that growers who produced more would only make the situation more acute. On 14th April I told th Graziers' Association in Sydney there was a need to bring about some scheme of rationalisation of deliveries to the terminals that year -1969 - or there would be chaos. On 17th April I was in Rockhampton, telling the Central Coastal Graziers' Associa-tion of the enormous problems we were facing if growers went

on planting more wheat. On 7th July I told the Agricultural Council of what had been happening, and repeated all my warnings about the dangers of producing too much wheat, and of the financial burden this was placing on the industry.

By this time the delivery quotas scheme was operating, but additional complications were looming; so on 21st July in Adelaide I told the United Farmers and Graziers' Associa--tion of the dangers of over-quota direct trading. On 27th August at Dowerin in Western Australia I said growers might

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have to be prepared to live with quotas until stocks were reduced. The next day I was a few thousand miles away at Toaczoomba'in Queensland telling growers they must make the scheme work, or the whole industry would be in turmoil,

'On 11th September I was in Adelaide saying the same thing, and adding that it ill became a major political party -the alternative Government - to be repudiating a scheme devised by Australia's wheat growers for their own industry. In Canberra on 15th October I told the National farmers' Union that statements being; made by a public figure that quotas should not be applied in 1969 were flying in the face of the

industry's recommendations and doing nothin .but sabotaging the scheme and selling out to the big producer.

I took the initiative in clearing the way for the Wheat Board, in co-operation with the bulk-handling authorities, to provide up to 60 million bushels of emergency storage facilities,

And, looking back over the last few years, I've told meat producers that we are entering a period of difficult export market access, rising production and static home consumption. I've urged the meat industry to look towards

some kind of overall marketing arrangement to rationalise and regulate supplies to all its narkets, I've continually kept before the industry the need for the highest hygiene standards to meet the requirements of export markets. I recall drawing attention to the potential of the Japanese market for meat. I've urged producers to look at the use

of now breeds. I urged early action on voluntary restraint on shipments to the united States to avoid the bringing down of a quota that would disadvantage us,

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I've long advocatod limiting dairy production. I've told told dairy farmers they are producing too much fat and not enough protein. I've criticised the Victorian Government for opening up new dairy land. I've urged diversification

away from butter, the export of which drags dorm producers' returns. I've told the industry extra subsidy isn't the answer to its problems. I've suggested the industry must kick off the logrope of established methods as better ones become available. I've urged the. industry to get the most it can out of its best market -- the home market. I've said that milk zones are an anachronism, and urged the industry to put its marketing house in order. I've told it it must be ready to adjust to the changed conditions which will apply if Britain enters the Common Market, And now I've got to the stage of saying we should reduce daiey production. I've talked of the need to work out a skim =ilk equalisation plan. I've urged the industry to consolidate its position to meet the challenge of the future.

Back in 1967 when I was Minister for the Interior I remember saying the wool industry rust gear itself to the

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containerisation era. I've continually urged the industry to improve its standards of clip preparation and presentation. I've called for the production of more wool, more good wool, and wool of uniform quality and preparation. I've even said I could .sce no harm in mixing wool with artificial fibres. I've urged growers to break away from traditional methods of production and handling. I spoke very strongly on the need for them to come to terms with themselves on marketing. Last year I said the wodl industry had reached a crisis point and must make a decision onrarketing immediately, I've pointed to the need to increase the =rorld's supply of fine wool to prevent man-made fibres filling the supply gape

I've described as "?absolutely crucial' the need to introduce a series of measures for the long-term survival of wool - fully-integrated wool-selling complexes,modern handling and transport methods, data processing techniques,

objective measurement.

W. Chairman, again I will not continue reading the many references An my paper to occasions on which I have spoken in this vein. These references can be read by those who are interested. But I hope I've made the point that the charge against me and the Commonwealth Government of lack of leadership is difficult to sustain. I believe that what I have had to say to all these industries has in every instance been constructive, and designed to help them in the difficult circumstances of today,

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I've had a few things to say to the sugar industry from time to time. In 1968 1 warned both the canned fruits and rice industries of rapid increases in production which could bring problems. I urged the cotton industry in that year to do something about its marketing arrangements. I've told

egg producers they are producing too many eggs for their own goods I tve warned them against increasing their flocks; urged them to consolidate their position; told then exports are unattractive, new markets virtually non-existent.

I've I've warned pig producers of the dangers of vertical integration in their industry. I've said grape growers should be ready to meet the situation that will arise when plantings catch up with demands. I've told wine producers it would be a pity to see development of their industry undermined by unwise pricing policies.

a stabilisation plan They rejected its fruits we ve set hp is investigating the to recommending growers they mus t have ;emend in the face of

I spent two years negotiating for the dried vine fruits industry. You c ^n -t win them all ! With canned

an ii nte:cdepo,rtmental committee which problems of the industry with a view solutions. I've told apple and pear

some kind of orderly marketing arranj ii. sing'productions

On more general matters, I've talked of the need for greater productivity --• not production, except where there :re market opportunities available for the increased prodution I've u ged farmers to make the greatest use

they can of the skill that is available through extension servic,s and private managemer_ advisors, In the fishing

industry :: ° „e taicn a great many steps to help the industry in tro .last two :-ears, I 1ve sugges ted the need for a number

of measure, to help fight drought, and some of them now exist,

_=ve urged the seed industry to produce high--quality seed at prices economic to the user, and warned against insufficient field testing and technical backup. I Ive told the banana industry they need to do more research on preservation end handling. I've said the poultry industry needs more research and should try to increase its exports.

I've told the scientists they must play a bigger part in tackling the social and economic problems of farmers.

T had to lead the battle against the irresponsible people who tried to encourage growers to plant a non-recommended wheat variety in New Sou th Wales. I've called fr-r recognition of the fact that we must have strong merino

studs in this country. I've told farmers to be very careful about the machinery they buy for their farms. I've long advocated the need for finance to be provided on concessioxial terms, and claim some of the credit for what has been done,

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I've admitted that the Australian Wool Industry Conference isn't perfect, but have told those who are not satisfied with it to work to improve it, not discredit ite I've urged farmers to look carefully into the

question of going into sideline crops, I've ,welcomed the trend from dairying to beef, but said it shouldn't go too far in some districts.

Now, before someone tells me it's all very well for me to say all those thing' without backing them up with Government action, may I say a little about the way the system of consultation and discussion.-works between

Government and industry, It isn't just a question of my making all sorts of statements, or telling rural industry organisations that it=s up to them to find answers to their problems, and then leaving thorn to it,

You all know the line we take when talking about this matter: that the Government lc•oks to the industry organisations for advice on policy; that we try to implement policies put forward by the industries themselves, That's quite true, but it doesn't tell the whole story by a long way0 it isn't just a question of my sitting in my office

in Parliament House and saying, 7I wish someone would come and tell De what to do about wheat, or ,whatever it may be, The process of consultation, discussion, and thrash-ing-out of ideas and policies is virtu-.ally a continuous one,

receive a constan t stream of people in the primary industries who discuss with me their ideas about policy for their industries, and of course I give then my feelings at the some time° We have for some years now had consultation procodures by which primary industry organisations -- along with loaders of other sectors of the e o .c:: i - can put their views in person to the Cabinet P,7inisiers concerned with the whole range of economic policies, 2md, of course, there is constant contact between the officers of my Department, and the )fficers of the Bureau of Agricultural Economics, and people in the primary industry organisations.

I don't think it's going too far to say -. and you know this happens -- that quite often before an industry puts a proposal before the Government there has already been a tremendous amount of contact, consultation and discussion between officers, and perhaps Ministers, of the Government and the industry concerned, This is a two-way process -the Government needs the advice and suggestions of the industry itself based on its wealth of practical 3aiowledge and understanding of its own problems and possibilities.

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At the some time the industry needs the expert knowledge and experience the Government has available to it to help formulate policies which are going to help it on a sound, long-term basis. I think this is the right way to go

about it. It is inevitable that in the interchange of ideas, in the discussions behind the scenes, in the private talks, there must be, and there is, extensive consideration of the

alternative linos of action which are possible and their implications for the short and the long term - a lot of development and polishing of policy .ideas. We do it this way because it is our aim that when a firm proposal is put

before no officially, I can take it to the Government knowing that it is a sound, practical policy that has the support of the industry, my own support based on my own knowledge and opinion and the expert advice of my officers, and further that it is like: y to be acceptable to the Gavernient. To me, this approach makes sense.

One of the facets of agricultural policy mast urgently in need of implementation is that of adjustment, of reconstruction. Anyone who looks carefully at r$iost of our rural industries cannot escape the conclusion that this adjust.en'c is needed; that many farms are too small to produce a decent living; that there is an urgent social problem to be tackled.

The first industry to come to grips with this problem was the dairy industry. About three years ago the Australian Dairy Industry Council asked. the Commonwealth to introduce a scheme to reconstruct low-income dairy farms, Now this was

a good idea, It appeared to have the support of the whole dairy industry. Sato Governments, particularly your Govern-ment here in Western Australia, has been operating reconstruction schemes on a limited scale for some years, and operating them successfully.

But, you know, that is right, and what is good for farmers doesn't always appear that way to them. And this is one of the great difficulties overlooked by people who demand that the Government tell farmers what to do; that the Govern-ment give more direct guidance to rural producers. The Commonwealth accepted the dairy industry's proposal on reconstruction. Mr. Adcrmaxni said this when he introduced the current stabilisation plan. When I became the Minister I began telling farmers about this plan their industry had put forward. And you know what happened then. There's only one way to describe it. All hell broke loose! And it's still on.

I've been kicked from pillar to post all over Australia for wanting to drive the small farmer off his land. I've been accused of wanting to destroy the traditional family farm; I've been told that what I want in Australia is one big farm, probably owned by an American corporation! What I've never been able to understand in all this is how people can imagine

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that I, a Member of Parliament representing more small farmers than any other Member; a Country Party Member pledged to fight for farmers; a Country Party Minister; a Minister charged with the job of administering farm policy in the interests

of farmers; a small farmer myself; a politician vitally dependent on the votes of small farmers ... how is it imagined that my great desire is to drive , as any of them off the land as possible? Yet this is what is claimed about me.

I don't like criticising the Press, because I get an well with them and have few complaints about their work. But I do blame them to a fairly large degree for all this misunderstanding of the small farm problem.

A few weeks ago I spent an hour talking to the Farm Writers and Broadcasters' Society in TVIelbo.urne, telling them of my ideas for keeping the family farm intact; for keeping the small farm in business on a profitable basis.

I mentioned the need for adequate capital for the family farm. And so it went on. The next day, there was a headline in The Australian ....'Anthony Predicts End of Small Farmer'. And now the letters are coming in again.

'Dear Mr. .Anthony, I read in The Australian where you said the small farmer must go...'

I"La tellingyou all this to illustrate that it isn't as simple as it seems for Governments to implement sound, constructive, worthwhile and urgently-needed policies, It's most discouraging for anyone who, like me, has examined the plight of small farmers, measured the extent of the problem, talked about it and tried to do something about it, to be -.bused up and down the country by the very people he is trying to help. I've now got to the stage whore I'm putting together a document of about 20 pages containing virtually

everything I've ever said about the small farmer. Nowhere in it will anyone find anything to substantiate the claim -'Anthony wants to get rid of the small farmer',

Those who talk of Government planning for agriculture usually do not talk of the thing that must go with it -Government direction. It is no use planning if you don't take steps to mako your plans work. It is hard enough to work out plans in consultation and co-operation with primary producers and then make then work, let alone work them out on your own and enforce them. I do not believe Australian farmers want Government direction. They are

pretty tough, independent characters. Although some of them are saying the Government should toll them what to do; I think that when they think it through, and realise that it isn't nearly so simple as that, they will want to continue Eder the system of joint Govornmont--industry consultation , co-operation and implementation.

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There are problems, difficulties and uncertainty about the future for our rural industries. We need to face up to these circumstances without surrendering to them. We live in a changing economic environment which affects rural producers as much as anyone else. Rural producers like everybody else have to react to change. Consumers are becoming more and more sophisticated, and farmers have to produce what the consumers demand. Developments have to be faced and adjustments made. No

one likes having to adjust thoir enterprise. We become accustomed to doing things, and don't like to have to change.

In talking about adjustments I'm not"thinking in terms of what has happened in the United States and elsewhere, In the United States in 1947 there were 6 million farms and 26 million people living on them. Today

there are 3 million farms and a farm population of 10 million. In Australia the number of commercial farms has declined by a few thousand since the war, and the farm population has also declined by a few thousand since 1958.

We have to devise policies to assist rural producers to obtain their share of our expanding wealth. Generally the size of farm properties is adequate, although the problems for some will increase.

There is potential, aided by scientific advances, and in some cases reconstruction, for rises in output per farm end per unit of lahour. I see no need for any real change in the traditions of family farming.

Improvement in efficiency end productivity is likely to become the central tenet in farming. The evidence indicates still that very good returns to efficient management are possible, although a limiting resource is capital. The capital investment in rural properties has increased by about one-third over the past twelve years, excluding livestock and the unimproved value of lend. Thisis a striking increase, represented by such diverse items as tractors, chisel ploughs, irrigation plants, dams, fences, silos and other improvements. The number of tractors on farms has increased from 224,700 to

324,000 over the past ten years, and their horsepower has been steadily increasing. Farms in Western Australia generally are larger than in most other areas. T,he capital value of a wheat property in Western Australia increased from $38,000 to $54,000 excluding the value of land,between 1959-62 and 1964-67. All this represents a very large capital investment that has to be financed.

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These trends will inevitably continue and change the pattern of farming. Adjustment will be required. Farms that once provided an adequate living for their owners will no longer do so. They will be unable to finance

the capital required, and so change is inevitable.

The whole f'Lustralian community has bone€fitted from the changes and adjustments that the fart sector has made in the past.

We must help the rural sector in its adjustment and ensure that the adjustment is made as easy as possible.