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Thursday, 15 September 1983
Page: 906


Mr PEACOCK (Leader of the Opposition)(3.39) —I would not talk about our being a bit thin on the deck. We have about a 100:1 ratio here with two Government members in the chamber. We have moved this matter of public importance concerning the confusion and uncertainty caused for Australian industry by the conflict within the Government over protection policy because of what has transpired this week. If industry is to invest, to become more profitable, to become more competitive and to create more jobs, there must be clear, comprehensible and coherent policies from government.

Recent contradictory remarks made by Ministers have given rise to very great uncertainty. I remind the House that, on 12 September, the Minister for Foreign Affairs (Mr Hayden) said that our protectionist policies were 'embalming geriatric industries in a sort of formaldehyde of protection, On 14 September, the Minister for Trade (Mr Lionel Bowen) made perfectly clear his support for high levels of protection and added, rather tartly:

In matters of trade I am responsible; in matters of foreign policy the Minister for Foreign Affairs is . . .

We also note that he told the House, although we could not read about it in the Hansard this morning:

. . . we--

that is, the Minister for Trade and the Minister for Foreign Affairs-

agree to disagree on a few minor matters--

He then rather hastily added:

not matters such as this though.

In other words, there was no agreement between him and the Foreign Minister on industry policy. We have known for a lengthy period what the attitude of the Minister for Trade has been. He even goes to open international trade fairs which are generally accorded in a given area to promote two-way trade and proceeds to speak on the benefits of high rates of protection. Honourable members can imagine the degree of disillusionment amongst members of his audience.

Let me be quite clear on this. We have never run away from this difficult area. We have said that high levels of protection cannot be reduced overnight. But we have equally said that, as with every other country, interdependence is not some foreign policy cliche. It connotes that essential element in trade-that one country trading with the other is thereby dependent on the other. There is an interdependent element throughout the world on questions of world trade which has to be addressed. It is not good enough for the Minister for Trade to come into this House and simply say 'Look, I not only disagree with the Minister for Foreign Affairs, but I have to recognise that there are many distortions in world trade', talking to us as if we did not know about the distortions created by non-tariff measures. I have never resiled from the reality that when Australia is attacked for its allegedly high protectionist stance, we need to point out that more than 50 per cent of the world's trade is distorted by non- tariff barriers. We know of the examples around the world of some countries even preventing motor vehicles from coming into their given jurisdiction by the use, for example, of a drug Act or drug regulation because the medical kit in the glovebox of a vehicle did not allegedly fit within the confines of that particular drug regulation. I abhor that approach just as much as I abhor the approach of people who feel that we can solve the difficulties of the international economic situation by moving to higher rates of protection.

Central to it all is the necessity that a government give clear, comprehensible and, as I have said, coherent policies so that those who wish to engage in trade with us know what we are about and, more particularly, so that our own industralists and their employees know where they stand. We have a situation in Australia today where not only a senior Minister, involved inevitably as he is as Foreign Minister in international, economic and training matters, but also the former Leader of the Australian Labor Party, are saying that we are ' embalming geriatric industries in a sort of formaldehyde of protection' while the Minister for Trade totally disagrees and simply says in this Parliament that we have to take note of the non-tariff barriers around the world today. We have not had spelt out in this Parliament any coherent program whatsoever relating to protection policy. It is not surprising that industry is confused, that it is uncertain; that, on the one hand, trade unionists are denigrating the Foreign Minister and, on the other hand, certain other elements of Australian commerce are praising the Foreign Minister and denigrating--


Mr John Brown —Which certain elements?


Mr PEACOCK —Of the trade union movement?


Mr John Brown —No.


Mr PEACOCK —I refer the honourable gentleman to the remarks Mr Thompson made about the Foreign Minister at a meeting of the Australian Council of Trade Unions. Again I do not have the quotation with me but I could have it brought into the chamber. Mr Thompson attacked the Foreign Minister. I am not surprised because I would imagine that there had been a degree of tick-tacking with certain other Ministers around this place. After all, the Minister for Industry and Commerce (Senator Button) said that the Foreign Minister's views had been coloured by his frequent trips through South East Asia. So we have had added to the confusion not only the statements of the Foreign Minister, the Minister for Trade and the Minister for Industry and Commerce but also that rather exciting injection the other day when the Minister Assisting the Minister for Industry and Commerce (Mr John Brown) answered a question by reading from his plethora of pages provided by his Department of Industry and Commerce advisers-matters about which only the date and time had been changed so far as I could tell from what was submitted to me and my predecessors. I cannot recall any of us simply giving voice to that piece of bureaucratic language that was put down by the Minister who is to respond to this matter of public importance.

On AM today the Minister for Trade again distanced himself from the Foreign Minister's views. The Foreign Minister said:

Our economics have got to be right.

Now there is a first class statement! If we are looking for guidance from the Minister for Trade on our trading policies we will be guided by what he said this morning: 'Our economics have got to be right'. The Hansard might be wrong- his officers might change the Hansard-but he seems to have very firm views that economics need to be got right. I assume that by that he meant we need lower protection.

Today the Minister for Trade said that no country in the world has its economics right. He argued that free trade was unachievable. Quite clearly, these contradictions raise questions about what our trade policies are and, more particularly, who makes them. We know from our friend, the Deputy Prime Minister (Mr Lionel Bowen) that the next time he is Acting Prime Minister some poor, hapless ally will again be taken and possibly dragged off, rhetorically speaking , to Beirut, just as our friends the Japanese were to be taken with us to Kampuchea. I would not know whether, during that period, we could place the same reliance on the remarks in the trading area because each time the Trade Minister speaks in these areas there is an extraordinary degree of confusion. Confusion weakens Australia's reputation as a stable trading partner, and as a responsible member of the General Agreement on Tariffs and Trade and other international trade agreements.

We all know that it is difficult enough in the international economic climate. We must share some of the blame for this as must every member of the Western industrialised world, because we have never got right the relationship between finance and trade policies at the international or the domestic level. Perhaps the West Germans are the only ones who have been able to act in a more cohesive manner in this area. There is a desperate need for bringing together, for example, at the international level, the viewpoints of those who participate in International Monetary Fund and International Bank for Reconstruction and Development discussions and those who are associated with GATT. Sometimes they seem to be producing or following different lines and so too at the domestic level between the Treasurers, Finance Ministers and Trade Ministers. But when this matter is exacerbated to the extent that has occurred between the Foreign Minister and the Trade Minister, confusion is heaped upon confusion.

I referred earlier to the fact that the Minister for Industry and Commerce, who is supposed to be responsible for industry policies, made reference to the Foreign Minister's remarks as being simply coloured by his frequent visits to South East Asia. However, the most serious element of it all is that the inconsistency between all these Ministers undermines any confidence Australian industry have in planning ahead with that degree of certainty of coherent, stable government policies that they ought to expect.

We have the Prime Minister (Mr Hawke) coming in here and saying that the Government believes in wage restraint and that the prices and incomes accord will work. We know that the primary reason for the difficulties facing Australian industry today is that it has been cast out of the market because of the wage hikes. With the covert consent of this Government we will have a 4.3 per cent increase this month in wages brought down by the Australian Conciliation and Arbitration Commission and a return to full indexation next year, thus giving Australian industry no competitive position whatsoever. When we add to that the gravity of this uncertainty, coming at the inopportune time of world recession, the growth of Asian industries, Australia's falling competitiveness, and the Government's abandonment of the wages pause, then Australian industry is not merely placed in a less competitive position but, as I said, it is unable to plan with any certainty at all when the conflicting statements that are being made by Ministers are taken into consideration.

The Opposition makes its position quite clear. Australian industry has to remain outward looking. We must encourage export oriented industries. We have to capitalise on the proximity of the world's fastest growing markets. That will require gradual predictable reductions in protection and it will require incentives for industry growth, whether through accelerated depreciation provisions or incentives for high technology. It will not be the sort of thing that this Government does, with things such as sunrise industries, thinking that it can pick out the industries. The shadow Minister for Science and Technology has time and again said that governments are notoriously bad at picking winners and picking losers.

It is not the role of government to involve itself in that way, it is the role of government to create certainty to allow for flexibility and adaptability to occur within the market place. The flexibility and the yacht-like tacking that occurs within the ranks of this Government is the very last thing that industry requires. We need gradual predictable reductions in protection; we need incentives for industry growth. I have mentioned accelerated depreciation provisions and the incentives for high technology, which incidentally, were wrapped up in a very plausible program for high technology in the program of advanced technology, the Adteci Corporation, which the previous Prime Minister spelt out in the policy speech. That was the approach to take, to throw it open to the only area that is the determinant as to whether industry will succeed in the end, namely, the market place, with government creating the proper climate. The very reverse is occurring on the other side.

The protection against unfair competition and the moves that the Government has made in relation to dumping I have endorsed before. However, I come back to the central element. We have had confusion heaped on confusion. We have had statements that industry is being embalmed in a sort of formaldehyde of protection. We have been told by the Minister for Trade (Mr Lionel Bowen) that we must jack up protection to hold to the employment factor as the basic criteria in protection policies. That was the fundamental approach in the 1930s. I know that for years there has been a ridiculous debate in this country between protection and free trade. It has not brought the sophistication that so many of us would require to be injected into it. When that debate is going on publicly between the Minister for Foreign Affairs and the Trade Minister, it is time for the Opposition to say: 'Time enough for this. Give industry the coherence that is required so that it can plan it effectively'.


Mr DEPUTY SPEAKER (Hon. Les Johnson) —Order! The honourable gentleman's time has expired.