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Wednesday, 19 September 1973
Page: 1260

Mr EDWARDS (Berowra) - As the Leader of the Australian Country Party (Mr Anthony) said, this Bill provides for the deletion of section 6 of the Principal Act. The Minister for Overseas Trade and Minister for Secondary Industry (Dr J. F. Cairns) pointed out in his second reading speech that section 6 ties subsidy rates to circumstances as at 1 December 1969 and in general very strictly limits the circumstances in which the schedule of subsidies can be amended. In that way this Bill paves the way for implementing the proposal referred to by the Treasurer (Mr Crean) in his Budget speech to widen the margin in petrol prices between city and country areas from 3.3c a gallon to 5c a gallon. Thus a large and important benefit will be reduced. Farmers, the people in country towns, and country industries will pay 1.7c a gallon more.

On the face of it, the scheme itself is not to be abolished. That is to say, the principle and purpose of the scheme are to be retained; at least I hope that will be the case. As my colleague pointed out that is by no means certain. It is presented to us at this stage as enabling legislation for a cutback, as one of the Coombs culling operations, and it is one of those acts of bastardly or antagonistic-

Mr Katter - That is fair enough.

Mr edwards - Yes. It is one of those acts antagonistic to country people that we have come to accept from this Government. As I have said before anti-rural is the stance of this Government. There can be no doubt that this scheme has been of great benefit to a variety of people. I mention first country dwellers, not to mention of course country industries including State and municipal governments' power generation authorities and other bodies. I shall come back to that point. The scheme has been a very significant factor in welding metropolitan and country life into one Australian community. There is a basic justice - equity - in all Australians whether in the coastal cities, the larger inland cities, the smaller country centres or on the farms, paying similar prices for the same products.

The case in equity is all the stronger when it is recognised that in country towns in many cases there are forces making for lower wage rates for the same job as compared with the larger cities. I have a young relative who is a machinist-fitter who draws about $30 to $40 a week less than his counterpart in the city. A scheme such as this one designed to effect some equalisation of prices - the original objective was actual equality - provides a partial offset to the situation. And yet here is the Government increasing the differential. One would have thought that this so-called Australian Government - those are the words Government supporters like to use - would have been more sympathetic to the view I am putting. I suppose to some extent, as I have said, we are not certain whether continuation of the scheme is approved in principle. I pose the question: Is it, or is it not? At least at this stage it can be said that the Government has not legislated to abolish the scheme. But of course if one reads the gospel according to Coombs in the Coombs report, one sees among the possibilities the phasing out of the existing program over, say, 3 years by progressively raising the subsidy margin. This legislation is the first raising of the margin giving vent at least to that extent to this Government's anti-rural bent.

I have referred to the moulding of one Australian community. The interdependence of the city and country is of course absolutely fundamental. The best evidence perhaps is the high correlation that exists between the prosperity of the rural sector and the prosperity of the nation as a whole. When I speak of the prosperity of the nation as a whole I speak in particular of the major capital cities whose interests this Government so carefully studies to the neglect of the country areas. The slack in general economic activity in 1971-72 about which Government supporters are always so keen to castigate the Opposition, falsely attributing it entirely to the former Government's budgetary policy, was in fact caused to a large degree by low farm incomes. They had the effect of retarding the growth of private consumption, perhaps by as much as 1 percentage point. I will not elaborate but that is very important in that context. This Government which sees itself so much as city based had better remember that its fortunes are also tied in this way to the prosperity of the rural sector.

The enlargement of the margin - this reduction or cheese paring of the benefit I suppose one might call it - will not affect only country people.

Mr O'Keefe - It will affect costs everywhere.

Mr EDWARDS - It will. As my colleague says it will affect the whole of the national economy. When the widening of the margin and the increased excise duty on motor spirit provided for in this Budget are combined, the estimated result is that rural transport costs for farm produce will increase by up to 27 per cent. There will be consequential increases in food prices which will affect all purchasers, both city and country.

Mr O'Keefe - All primary produce coming into the markets will be affected.

Mr Katter - All backloadings will be affected.

Mr EDWARDS - Yes. So these problems will affect the city also and at a different extreme is, as I said a while ago, the impact on country industry and especially remote industry. Great but also small mining enterprises and their dependent communities will be affected. Need I stress the point? We all know the stance of this Government in the mining context under the leadership of so dogmatic, if I might say, and so prejudiced a man as the Minister for Minerals and Energy (Mr Connor). Mining enterprises in remote areas are already reeling under the difficulties of 3 revaluations with only partial compensation, apart from the iron ore industry. The proposed extra 5c a gallon is now to be payable directly on fuel and there will be this reduction in the benefit by the enlargement of the margin. As has been said, 'business is always one damned thing after another', but for the Australian mining industry things are coming too thick and fast altogether.

I have referred to the issue of whether this legislation presages the elimination of the scheme altogether. On that point, as my colleague the Leader of the Australian Country Party said, the Minister does have a tilt at the scheme as a whole. In his second reading speech he said:

The scheme is, however, expensive and less efficient in achieving its objective than is desirable.

One gets little insight as to just what is the objection save the Minister's remarks when he said:

In practice the largest pay-outs under it are made in major inland cities.

So what? The purpose of the scheme is the fostering of the one metropolitan-rural national Australian community. For that purpose there is a compelling case for it in equity and a compelling case in terms of encouraging regional development - or at least countering some of the pressures that work against it. So what then, if large payouts do accrue to the residents of Canberra, Broken Hill and Toowoomba?

In respect of the efficiency of the scheme it has also been said against it that it is not economic logic to provide a -subsidy which encourages people to remain in remote locations and to do this in such a way that the greatest encouragement goes to those in the most remote places. Distance, it is said, involves a real cost to the community and such a policy would enlarge that cost. But again, I suggest that that is to allow strictly doctrinaire economic thinking to run away and override considerations of justice and equity. Fortunately - if one can use that word in this sorry context - the flat, uniform widening of the margin will affect proportionately least the stalwart citizens, if I might so describe them, of the remote areas of Australia who live and work in the isolation of those places in the interests of this whole nation. They deserve better treatment than they are meted out by this city oriented, anti-rural Government.

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