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Wednesday, 7 March 1973
Page: 283

Mr WHITTORN In view of the responsibility of the Minister for Overseas Trade and Minister for Secondary Industry for overseas trade, both imports and exports, and in view of the fact that he said in December that revaluation would 'take the puff out of the stock exchange' and that those who lost money, particularly in mining, had no right to complain, I now ask him whether he is satisfied with the effect of revaluation on manufacturing industries. How does it affect employment in the textile, footwear and heavy industries, especially after the devaluation of the American dollar? Does he still consider that those Australians who invest in Australia's viable industries feel as complacent as he obviously feels when millions of dollars are lost by them, especially when jobs are placed in jeopardy by these decisions?

Dr J F CAIRNS (LALOR, VICTORIA) (Minister for Overseas Trade) - The effect of revaluation of the Australian currency, directly as the result of decisions made by the Australian Government and indirectly as the result of decisions made by the American Government, is quite considerable. I expect that the percentage change in the value of the currency as a result of these decisions would be greater than the percentage effect on Australian industry that would have come from a tariff change of the same percentage. Therefore, it will be appreciated that the change in the currency has a very considerable effect. These changes were made by the Government for very sound and strong reasons related to the level of Australia's reserves. The speculative aspects of currency dealings involved from time to time many millions of dollars. The decision about revaluation had very strong force and weight behind it. Unfortunately, any such decision taken in and justified by the national interest has consequences. The consequences of this decision will take a considerable amount of time to work out. It is not yet possible to foresee the effects.

In relation to the effect of the change in currency value on secondary industry and primary industry, both these sections of industry are being examined thoroughly by interdepartmental committees which have established criteria for adjustment and compensation. These criteria take into account other changes in the economy that have taken place. When action is taken on the recommendations of these interdepartmental committees - action has already been taken in some cases and will be taken in others as soon as the decisions are properly made - the effect on different sections of the economy also will be weighed. It seems to me that people who have been involved over a period of time in speculation in which millions of dollars have changed hands, as has been the case with speculation in the mining industry, and who have made a great deal of money on the speculative upswing, run the risk of losing some money on the downswing. Personally I have not much sympathy for the very well-to-do people who have been involved in that speculation. But there are many others. The particular effect that the Government will be very careful to take into account is the effect on employment. The first responsibility of this Government is not only to maintain full employment but to protect the job of everybody who is employed. Nothing will lightly be done that will endanger one job in this country. If, for reasons of national interest, changes have to take place and people have to be disemployed, that will be done with proper protection and with proper rights to retraining - things that the previous Government apparently never thought of.

Mr Peacock - You are going to direct them compulsorily, are you?

Dr J F CAIRNS - That remark made by a former Minister shows how unwilling he is to give serious consideration to this matter. It is very apparent from files we have and from statements that have been made that the previous Government was being briefed for a long time on the constructive action that could be taken to deal with these matters without any question of direction at all. Yet, in all these cases, the previous Government ignored the advice it was given. This Government will not do so. The proper steps will be taken to ensure that no injustice is done to anyone as a result of the currency appreciation.

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