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Wednesday, 30 May 1973
Page: 2863

Mr KELLY (Wakefield) - There are several things that I want to mention about this very important Bill. I am rather uncertain as to how far and wide we are allowed to range when talking to the Bill but I will, of course, be obedient to your wishes, Mr Deputy Speaker. However, I want to deal briefly with the fascinating subject of phthalic anhydride. I presume that as I am talking to the second reading of this Bill it would be competent for me to discuss this subject. As you have not signified any disagreement, Mr Deputy Speaker, I will just make a passing reference to this industry which has received yet another of these Special Advisory Authority reports. When this matter comes up formally in the next session I intend to deal with it a good deal more thoroughly.

I want to warn the industry that I am most unhappy about the present amount of protection that the industry is getting. As is the case with so many of the chemical industries the product of this industry lies at the root of other industries. This industry supplies the raw material for other industries such as the manufacturers of paint and plasticisers. There is only one manufacturer of this phthalic anhydride and that is the Colonial Sugar Refining Co. Ltd. I have always been critical of the expectation that big powerful rich companies such as CSR should get such generous tariff protection as they have been getting. In speeches I made about phthalic anhydride on 10 October 1962, 14 August 1963 and 14 April 1964 I pointed out the succession of tariff protection measures that have been taken to assist this industry. At one stage there were 2 organisations - the Broken Hill Pty Co. Ltd and, I think, the Newcastle Chemical Co. - engaged in the industry. Then CSR Chemical Industries, as it was then known and which later became CSR, took over. It has since been getting successive measures of assistance under the tariff.

This is another example of a Special Advisory Authority report recommending an increase in the rate of protection to help a company which one cannot say is really suffering. Let us have a look at the figures. According to the last annual report it made public - on 31 March 1972 - it made a profit of $20m and a return on ordinary capital of 27.6 per cent. The last half yearly report, which came out in September 1972, indicated that the half yearly profit had gone to $11.6m and that there was a 12.96 per cent higher rate of return. I cannot quite understand why an industry which is as important to other industries as this one is and which is in the hands of a firm that is as powerful and competent as CSR should need to have this kind of lavish protection handed out to it whenever it asks for it. If I had a good season but one paddock in the corner of the farm was a failure it would hardly be proper for me to go whining to the Government and say: 'Look I need some assistance. True I am doing very well overall but I am not happy about the return from the bottom paddock and I think the Government, the consumer or someone ought to do something about it'.

I think there is justification for the imposition of wise tariff policies, but to expect the infant industry argument to carry on for so long and to have infants as large as CSR, which has indicated a profit return on ordinary capital of 27.6 per cent and a total profit of $20.5m is, I think, taking it a bit too far. I understand that I must not range over too wide a field during the debating of a validation Bill. But I issue a warning that when the matter comes up for consideration in the future I will deal with it in more detail. In the meantime it is suffice to say that the Opposition supports the Bill.

Question resolved in the affirmative.

Bill read a second time.

In Committee

The Bill

Clause 3.

All duties of Customs demanded or collected (whether before or after the commencement of this Act) on or before 31 December 1973, pursuant to Customs Tariff Proposals introduced into the House of Representatives on any of the following dates shall be deemed to have been lawfully imposed and lawfully demanded or collected: 7 March 1973 15 March 1973 29 March 1973 3 May 1973.

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