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Wednesday, 16 October 1974
Page: 1765

Senator BESSELL (Tasmania) -I wonder whether the impressive list of figures that Senator Everett gave us during his address on this Bill took into account the dramatic increase in inflation since 1972. He said that the figure was around 50 per cent. But when the inflation rate has increased from 4.5 per cent per annum to 20 per cent per annum there is a fairly obvious need for a dramatic increase in the grant to take up this sort of slack in true money terms.

I agree with Senator Everett when he says that in freeing itself from the Grants Commission Tasmania has made a real step forward. I also agree with him when he says that the Grants Commission has had an effect on policy. We all can remember that not so very long ago the Totalisator Agency Board issue was raised. It was a policy that had to be looked at very carefully by the governing party. The direction that was given by the Grants Commission in its report for that year indicated fairly clearly that unless TAB operations were introduced there would be an adverse decision the following year. By enabling Tasmania to get out from under that sort of direction, the action of the Tasmanian Government has been of tremendous value to the people of Tasmania. But there have to be reasons why this action was sought and why it was needed.

Senator Everettmentioned the increasing number of visits to Tasmania that have been undertaken by members of the Federal Labor Ministry in recent times. I wonder whether those visits are not related to the particularly high vote that the Liberal Party received at the election in May this year. Of course, both parties are quick to recognise moves in public opinion. I think that at present the Government is recognising some signs which are unpalatable to it. This is the sort of situation that will make any government respond, and respond in much the way that Senator Everett outlined; that is, by sending its representatives into the area and by trying to overcome disfavour and unpopularity by the sheer weight of numbers and personalities. This will not necessarily achieve the result that is hoped for. When we look at the situation in Tasmania and relate it to the debate that is taking place at the moment and to the debate that we had a few minutes ago on the Australian Shipping Commission Bill, we can see that there is some reason for disquiet. I mentioned a fortnight ago today in my maiden speech that in Tasmania there is tremendous disquiet in the business community, in the farming community and in the commercial world. The quarterly report of the Australia and New Zealand Banking Group released just recently indicated clearly that a very large number of manufacturing businesses in Tasmania were looking closely at the possibility of moving out of that State. There is only one reason why they cannot do it: It would cost too much to move, notwithstanding that the present cost of getting their raw materials into Tasmania and their exports out of Tasmania is nearly as high.

The inflation rate and the high interest rates have destroyed the confidence of the people throughout Australia in this Government's ability to handle the situation. More particularly, this situation applies to Tasmania which, by reason of its size, does not have the ability to be flexible in its policies and does not have the resources to call upon to make job opportunities available to people who are displaced from industry. Senator Rae mentioned in his address to the Senate the number of people who are out of work in Tasmania. The figures show fairly clearly that the situation is worse there than anywhere else in Australia. The figures show that 3.14 per cent of the work force is unemployed in Tasmania. This percentage is above the percentage in other States.

The 2 areas in which the greatest pressure of unemployment is being felt are the textile industry, in which there has been a 5.15 per cent increase in unemployment, and the building industry, in which there has been a 1.78 per cent increase in unemployment. It is fairly obvious that, with the policies that have been adopted over the last 12 months, these are the sorts of industries that will react most quickly to changes in the economic climate. The building industry has always been a wonderful barometer of the economic situation. If there is a recession or if there is a downturn in demand, fairly obviously this industry will respond very quickly on the employment side. If there is an upsurge in activity, as we hope there will be in the not too distant future, the reaction is just as quick. But in the textile industry it is a different story. The position would not be so bad in the textile industry if there were only unemployment in certain of the mills. But, when the action of the Government causes the complete closure of a mill, this is a more difficult position. The mill then has to be reestablished and made into a viable business. This is not always easy and it is certainly extremely costly. The subsidy that has been mentioned without doubt represents a recognition of the seriousness of the situation. Mention has been made of the reason for the payment of the subsidy, not only in the Senate but also in the other place. The reason why this has been brought about needs some explanation.

We find, when we look back at the situation, that the accusation that the previous Government did nothing for 23 years cannot be borne out by a close look at the facts. There is no doubt that into the late 1960s, with the introduction by the Australian National Line of the roll-on roll-off method of shipping, Tasmania, in common with other areas of Australia, enjoyed a relatively competitive cost of transport. But, as time went on, this situation slowly started to change. It was recognised by the then Government and by people on this side of the Senate towards the end of the 1960s and in the early 1970s that something needed to be done. In this respect, we have the report that was mentioned earlier by Senator Rae. It is the report of the Senate Standing Committee on Primary and Secondary Industry and Trade on Freight Rates on Australian National Line Shipping Services to and from Tasmania. On 3 September 1970, the Committee was appointed to look into this matter. It made various recommendations. Two quite interesting reservations were expressed by 2 of the members of that Committee. The first reservation to which I refer is in relation to subsidy arrangements. Senator Rae stated:

I recommend that

(a)   the questions related to the introduction of some scheme of subsidy or freight cost equalisation be referred to the Bureau of Transport Economics for consideration at the same time as they carry out the recommended quantitative assessment of Tasmania's transport disabilities relative to the other States (Committee Recommendation No. 2);

(b)   the Bureau's report upon both matters be published for the consideration of all interested persons to then determine what action should be taken at a Government level.

Senator Wriedt,who was then a member of the Committee, said in his reservations:

For this reason alone, and for several others, particularly the vast sums of Commonwealth money which has been spent on mainland railways and beef roads, I believe the Commonwealth has an obligation to directly assist Tasmania in respect to shipping freight rates.

The significance of the comparatively low degree of departmental spending in Tasmania has been largely overlooked in the past and coupled with the declining rate of private investment in secondary industry in Tasmania, is a major factor in the State's inability to maintain a level of economic development with Australia as a whole.

I agree with the Committee's finding that the normal subsidy methods would prove difficult to achieve but I also contend that a taxation allowance on company tax should be given favourable consideration. The present rate of tax on all the shipping operators trading to Tasmania is a major factor in their consideration of freight rates.

I think it was clearly demonstrated at that time that these 2 honourable senators, who sit opposite one another in the Senate chamber, recognised that there were problems which, within the scope of the inquiry, the ability of the Committee and the time allowed to it, it would be impossible to unravel. The subsequent report that it was recommended be supplied by the Bureau of Transport Economics was made available in March 1973. I quoted from that report a fortnight ago many of the pertinent points which are still relevant to the situation that exists today. We see from that report that it is not easy to find a long lasting solution. The Government has had this report for nearly 1 8 months. It has not been able, from the information contained in the report, to arrive at a solution. Therefore, it has commissioned the Nimmo Committee report. We hope that that report will contain the details that will give sufficient clarity and a decision that is permanent, just as permanent as the one referred to by Senator Everett in regard to the $ 15m that is being made available to Tasmania. It will be of tremendous value, I think, to Tasmania which has shipping problems in its Transport Commission notwithstanding that two or three of its ships have finished up at the bottom of the sea. I think it is important that there is room for the Tasmanian Government to have opportunity to manoeuvre in the capital field and in the budgetary aspect, without continual recourse to Federal Government funds.

The other important subject with regard to costs in the freight field is the unquestionably very high pay that seamen get. I do not think anybody disagrees that a seaman like any other worker in Australia is entitled for his labour to a fair and equal share of the products of the nation. When one considers that these people work only a 32-week year, their rate of pay is over $300 a week. If shipping is to be effective on a scheduling basis, fairly obviously this must be extrapolated out to 12 months- 52 weeks of the year. If we do that we find that the cost of a seaman on each of the ships is in excess of $15,000 a year. It is fairly obvious that costs must of necessity increase very rapidly. When an inflationary pressure exists, as at present, it is fairly obvious that there will be large jumps in demand for increased wages and an increased share of productivity. There are many other aspects and side issues. I think that I demonstrated fairly clearly during the Budget debate that Tasmania is disadvantaged to the extent of $5m. I do not agree with the supposition that because certain goods that are imported into Tasmania receive the benefit of a freight equalisation scheme, there is no increased cost to the people of Tasmania. If one goes to the worker, the carpenter, the builder or the housewife, they will all tell you that there is very definitely an additional increase in costs. Some of those people still have enough money left, notwithstanding the economic situation in Tasmania today, to travel occasionally to another State. They can compare then quite easily the cost of groceries. Women seem to have a particularly keen eye for doing so.

Another matter has been causing a good deal of concern in my region of the State- the northwest coast. As many of the senators from Tasmania know, for many months there has been a good deal of speculation on the possibility of establishing a vegetable processing factory on the north-west coast with assistance from the Australian Industry Development Coporation We were trenchantly criticised by senators on the other side for our refusal to pass the AIDC and NIF Bills. When we look at what happened on Saturday of last week we realise that honourable senators opposite can hide no longer behind that excuse for the non-establishment of this factory. In the 'Advocate' of Saturday, 12 October, Mr Costello, the Minister for Agriculture in Tasmania, in answer to an accusation by Mr Mervyn Radford from the north-west coast that the Minister was unaware of what was going on, stated:

My Department co-operated with the feasibility study being conducted by the PDS, both in the provision of statistical information and also in discussions.

This company from Sydney was looking into the economic viability of the project. The report continues:

I also was present when the then Acting Prime Minister (Dr Cairns) visited the North- West.

Dr Cairnshad made it quite clear that, although he personally was in favour of the project, the Australian Industry Development Corporation had rejected it since it did not believe it was economically viable.

Dr Cairnshad gone on to say that, had the Senate not refused to pass the amendments to the AIDC Bill, then it would have permitted the establishment of such projects as the co-operative.

But the AIDC had decided already that they would not approve this project. For Government senators to use that as an excuse for their inability to compromise on such an important issue does them less than credit in this sort of situation, because it was not a point of policy in the Bill; it was just a request for a finalisation of the investigation.

Sitting suspended from 6 to 8 p.m.

Senator BESSELL - Prior to the suspension of the sitting I was trying to explain that the much vaunted processing factory in north-western Tasmania has not received the support of the Australian Industry Development Corporation because they themselves with all their wisdom and their ability have realised that it is not an economically viable proposition. Earlier, Senator Everett mentioned that there had been a 100 per cent increase in the amount of moneys received by Tasmania from the Commonwealth Government. I think the relevant point here is that during the last 4 years the tax revenue to the Commonwealth has doubled. Four years ago it was $7,248m. It is estimated that this year the amount will be $14,5 18m. If we take into account the 100 per cent increase in moneys received by Tasmania we must also take into account the 100 per cent increase in revenue to the Commonwealth Government which is about the same figure. There is not quite the generosity that would appear from what Senator Everett said. It is fairly clear that while Senator Everett said we ignored the situation it is important that he, in turn, ignored the amendment moved by Senator Rae. I think it is an extremely important matter. To support the amendment would show a solidarity to the people of Tasmania. It would show the people who elected us to this place- on whichever side of your chair, Mr President, we may sit- that we are vitally interested in what is going on and that we earnestly desire to get together to try to formulate a plan that will act as a solution for the disadvantaged people in Tasmania who have suffered, unfortunately, for too long a period.

Between us I think we have explained quite readily the reasons for the difficulty in arriving at a rational or workable decision. It is not a matter of just coming up with money. The money has to be applied in such a way that it will give relief that is needed. Mention was made of the $2m in connection with exports from Tasmania. Unfortunately, this could not relieve the disadvantage that Tasmania already suffers. It will also do nothing to relieve the import factor. We hope that the Nimmo report will bring down the types of figures and the types of graphic detail that is needed to arrive at a formula whereby this continuing problem to Tasmania which has occurred over the last 4 or 5 years can be finally solved to the satisfaction of the people of Tasmania. It has a relevance, of course, to the people of Australia. I think that we all realise because of the very nature of the agricultural activities in Tasmania, particularly on the north-west coast, a tremendous amount of frozen food and other things of this nature are produced which find their ready markets in Victoria and New South

Wales. For this reason it is extremely important that everybody should share the cost of transport between centres. Everybody in Australia should be prepared to accept something of the burden of the disadvantages suffered.

I think the reference made by Senator Everett to a group of people who were in Launceston yesterday hardly acknowledged the real situation. I understand that at one stage there was somewhere in the vicinity of 500 people. This has been brought about by a genuine desire of the people to bring to the Government's notice the real situation that faces this part of Tasmania. It is terribly important, I think, that we should recognise that there are areas in Tasmania and in other parts of Australia which have been sadly affected by policies of this Government. The Government acknowledges that some of the policies that it has followed in recent months have been responsible for the present situation. The Government has done what it could in this respect but there is still very much more to do.

In closing, I should like to return to the amendment. I again ask other members of the Senate from Tasmania to support the amendment moved by Senator Rae. In this way they will show the people of Tasmania the genuine desire of us all to find a solution to a problem that has been with the State of Tasmania for a long time. Unless a genuine and earnest desire is demonstrated to the people of Tasmania by us all they will lose faith that we will ever find a solution to their problems.

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