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Wednesday, 12 October 1983
Page: 1668

Mr GEAR(5.46) —In supporting the Bounty (Agricultural Tractors) Amendment Bill, I point out, as has been pointed out before, that the benefits will mainly go to Chamberlain John Deere Pty Ltd in Western Australia, the only major manufacturer of tractors. The need for assistance can be attributed to a downturn in the domestic market and, in particular, a sharp contraction for the first six months of 1982-83 financial year. Some of the factors that are involved are the drought in Australia-which, thankfully, now looks to be over- high domestic interest rates, the stagnant world demand, coupled with the global excess of production capacity. The present oversupply of tractors is reflected in figures that show in 1980-81 total tractor sales in Australia numbered 7,566. The surplus that year was 792. In 1981-82 total tractor sales had dropped to 5, 955 and the surplus had grown rather dramatically to 3,909. For the first six months of the financial year 1982-83, that is until December 1982, total sales had plummeted to 1,797 and the surplus remained at 3,812. In 1980-81 Chamberlain tractors-that is, the locally produced tractors-enjoyed 20.9 per cent of the market, selling 1,579 units. In 1981-82 that figure had shrunk to 18.2 per cent, reflecting 1,082 units sold. In the six months to December 1982 the figure had halved from that of the previous year. Its total share of the market was then only 9.6 per cent and in those six months it sold only 173 units. Honourable members can see from those figures that the downturn was rather dramatic.

Coupled with the large excess of tractors on hand-that is, close to 4,000 tractors-I believe that the stage was set for a dumping exercise. I call it a de facto dumping exercise. Dumping harms the local industry. Some of it is international dumping. The results are the same. The local manufacturer has been severely disadvantaged, not because manufacturers overseas have dumped their products but because importers have allowed a large surplus of tractors to be held in Australia. As proof of that I refer to a few advertisements which appeared in journals throughout Australia. The first one shows the normal price for a particular International tractor as $29,985, but offers a special discount close to $8,000. Another tractor, the normal price of which is $36,556, attracts a special discount of $10,000. Yet another International tractor, with a normal price of $41,544, attracts a special discount of $9,500. An advertisement for the tractors of Massey-Ferguson (Australia) Ltd, Renault (Australia) Pty Ltd, Iseki, Deutz Australia Pty Ltd and Fiat of Australia Pty Ltd offered discounts of up to $5,000. The advertisement states:

With the support of our manufacturers.

An advertisement for Belarus tractors states:

Before you turn the page, study this and save up to $30,000.

An advertisement for Fiat tractors offers an allowance of $3,500. An advertisement for Ford tractors states that for a Ford TW30 one can get $16,000 cash back; for a Ford TW20, $11,800; for a Ford TW10, $10,200; and for the Ford 8401, $3,900. All of these advertisements indicate that there is severe price cutting with the support of the manufacturers to get some of these surplus tractors into the market. No doubt in the short term this has benefited the people who bought them, but the effects on the rest of the industry are quite profound.

The intention of this Bill, of course, is to rectify some of the damage caused by advertisements such as those. Indeed, the car parks and all the stores of Chamberlain John Deere in Western Australia are full. It has about 800 tractors. It is overflowing with them. In fact, it has nowhere to put them. The effect of this is a substantial loss of employment. In Western Australia about 1,200 people used to work at Chamberlain John Deere. That figure has fallen to 800. This has also had a severe impact on apprentice training. Not enough apprentices are being trained in Australia now. To see our manufacturing capacity decrease in such a dramatic way also lessens our chance for training those people we will need when the recovery gets under way. In fact, it not only affects them; it also affects the local suppliers and contractors. I received a phone call this morning from Mr Kevin Durney, the Manager of Aircraft Industrial Marine Services , which operates in my electorate. He wanted to express his concern about the Australian Development Assistance Bureau tender, in which Massey-Ferguson was successful over Chamberlain John Deere, about which I will say a little more later. That firm has a contract with Chamberlain John Deere to the tune of $20, 000 a year for instrumentation. That is only one firm. Many firms in Western Australia rely on work from Chamberlain John Deere. They have been adversely affected by the downturn in Chamberlain John Deere's activity.

In regard to the question of foreign aid, I must say that I agree with the honourable member for Ryan (Mr Moore) when he talks about the ADAB tender going to Massey-Ferguson which will import tractors and send them overseas to Bangladesh. It is a great concern to me and also to those people in Western Australia-especially the 60 people who look like losing their jobs-if Chamberlain John Deere is not successful. I was so concerned I went to see the Prime Minister (Mr Hawke) to express that concern. He agreed with me that some points needed looking at. To his credit, he has asked for more information so that we can-more rationally, I hope-have another look at that tender. I would say that the only inhibition is that the guidelines under which the tenders were let were established under the previous Government. I do not know whether there is any way we can get out of those or whether we can bring some rationality into the matter. I certainly hope so. By sending our Australian tractors overseas as foreign aid and by competing, as did Chamberlain John Deere for a contract in Libya where it sold tractors, a vote of confidence is given to the Australian product. I agree with the honourable member for Wannon (Mr Hawker) on the matter of tractor cabs. I am sure that the local product is as good as anything we will import. That goes for Chamberlain tractors also. They are happy with them in Libya. I am sure that they will be happy with them in Bangladesh.

The 'Buy Australian' campaign will be getting under way fairly shortly. I cannot think of a better way for a government to express its support for 'Buy Australian' than to buy these tractors and send them to Bangladesh. The cost, of course, of not doing it would be borne by the community. One could not imagine the Japanese giving foreign aid and sending Chamberlain tractors. I am sure they would send Japanese tractors.

I think I have covered the ADAB tender fairly well. I do not intend to go into it any further except to reiterate that I think that wherever foreign aid is involved we should send the local product. We should send Australian tractors, thus helping to keep Australian companies in business, Australian workers at work and not importing tractors to send overseas. I believe that there is a substantial case for Chamberlain John Deere receiving this assistance. I commend the Bill to the House.