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Wednesday, 30 May 1973
Page: 2861

Mr O'KEEFE (Paterson) - I rise to support my 2 colleagues the honourable member for Wakefield (Mr Kelly) and the honourable member for Darling Downs (Mr McVeigh) who support this Bill. This Bill seeks to extend up to 31 December 1976 the bounty which is paid on agricultural tractors manufactured in Australia. This legislation fully supports in their entirety the recommendations which were made as a result of the recent Tariff Board inquiry. The tractor industry has grown with the wheat boom years 1965 to 1969 when the total number of tractors in Australia rose from 290,000 to 323,596 of which 299,297 were wheel type tractors. This industry is one which experiences great fluctuations due to the varying seasons experienced by farmers right across Australia. In fact, huge losses have been sustained by tractor and machinery companies operating in Australia in the past few years. Some firms manufacturing tillage implements have folded up and they have been taken over by their competitors.

While tillage and harvesting machinery has been manufactured for many years the manufacture of tractors has been, comparatively, a much later proposition. Imported tractors come mainly from the United States of America, Great Britain, Canada, Italy, Czechoslavakia and other continental areas. The huge import of overseas machines was no doubt the main reason why the LiberalCountry Party Government brought down in October 1966 the Agricultural Tractors Bounty Act to cover tractors manufactured in Australia and to give Australian firms protection from overseas companies which were manufacturing for the world market. The first company to manufacture tractors in Australia was John Deere Chamberlain Pty Ltd of Welshpool in Western Australia. The Government encouraged that company by way of subsidy payments from 1 July 1969 to 30 June 1970. A total of 1,779 tractors were manufactured on which bounty of $992,478 was paid. The value of the machines totalled $7,727,000. That was a very worthy and great contribution to the tractor industry in Australia. The greater the horse power of the tractors produced the larger the bounty that was paid by the Government. This practice has continued under the provisions of the Agricultural Tractors Bounty Act. The amount of bounty which is payable is clearly set out in Schedule 1 to the Bill. That Schedule takes into consideration low horse power tractors and extends up to tractors in the 80 to 100 horse power bracket. The action of the Government in paying bounties encouraged this company to manufacture in Australia, saving valuable foreign exchange and creating employment for labour and industry. It helped us to be self-sufficient in this very important field.

When we look at the situation we find that the next company that manufactured here was the International Harvester Co. which has its headquarters in Melbourne. This company soon followed the example set to it by Chamberlain Industries. From 1 July 1969 to 30 June 1970 this company received from the Government by way of bounty $764,000 for 1,407 tractors produced at a value of $3. 4m. These figures indicate clearly the growth of this industry due to the assistance given by the Government -to the companies. In 1971 Chamberlain Industries was paid a bounty totalling $848,535 for the 1,333 tractors which it manufactured, and the International Harvester Co. was paid a bounty totalling $537,183 for the 1,147 tractors which it manufactured. So both of these companies have been helped considerably by the bounty which the Government has paid on tractors manufactured in Australia. Tractors manufactured in Australia have helped farmers right across 'the board in their production campaigns, particularly in the big wheat years. They have helped these farmers to achieve the production of huge quantities of wheat which has been of great benefit to Australia both from a national point of view and from every other angle.

Another intending manufacturer of wheel type tractors in this country will be covered by the Bill that we are at present discussing. This intending manufacturer is the Pointer organisation which plans to make an unconventional wheel tractor designed particularly for use in developing countries. Having looked through the records one finds that this company will be manufacturing in Victoria. It has not got off the ground yet. At current levels of production both local producers are well below their maximum plant capacity. Chamberlain Industries has a capacity on a multiple shift basis of over 3,000 units per annum. At the time of the Tariff Board inquiry this firm was working at slightly over only one shift capacity with additional time being worked in some production processes. The International Harvester Co., which has a plant capacity considerably in excess of that of Chamberlain Industries, has indicated that it could increase its output considerably by working its sheet metal, forge, welding and machine shops on 2 shifts with 3 shifts on certain key machines.

Local producers' combined plant capacity is sufficient to supply over 40 per cent of the 1975-76 total market demand, which was estimated recently by the Tariff Board to be 15,000 tractors. At the present time neither local producer has plans for extending its production facilities. The reason for this is that this industry has received very severe setbacks over the past few years due to drought conditions and a lack of farmer income. These companies have had to curtail their manufacturing program. Indeed, when we look at the companies which supply tractors from overseas we find that their imports of machines are down considerably. It has been only in the past few weeks that the number of tractors in Australia is catching up and is sufficient for current demands made on this industry by the farming community.

At the time, of the public hearing of the Tariff Board local manufacturers employed just over 1,000 people in the production and distribution of the goods under reference to the Board whereas prior to the decline in production in 1969-70 it is estimated that approximately 1,600 people were employed. These figures do not include the considerable number of people employed by manufacturers which supply mc and Chamberlain Industries with spare parts and they do not include the great number of people who are employed right across Australia in the various tractor distributing organisations which sell to the farmers. So U ls an industry which is very important to Australia, which employs a great number of people, and which is making a splendid contribution to the economy of the nation. It is my wish and the wish of my colleagues that more companies operating in this field should commence manufacturing in Australia and thus make a contribution to employment in Australia and in this industry. I feel that as the years progress and as courage comes back into the industry as the seasons possibly revert to their normal condition we will see this happen. But the way the seasons have been manufacturers certainly have not been encouraged to put capital into this industry. I support the Bill.

Question resolved in the affirmative. Bill read a second time. Message from the Governor-General recommending appropriation announced.

Third reading

Leave granted for third reading to be moved forthwith.

Bill (on motion by Mr Daly) read a third time.

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