EMBARGO ETKhARGO EMB~ ARGO
Not to be published or broadcast before
7pm, Sunday, 11th February, 1962.
FOR PRESS ADDITIONAL PROTECTIVE PROCEDURES
( Statement by the Deputy Prime Minister and
Minister for Trade, Mr. J. McEwen)
The Minister for Trade, Mr. J. McEwen, today elaborated
the measures the Government proposes to take to extend the
protective machinery at present available to Australian industry
both primary and secondary which are affected by imports.
He stated that these measures accord with the Government's
policy of continued growth of the economy with employment for a
continuously growing workforce.
Mr. McEwen gave details of the machinery which will be
set up by the Government to deal with requests for temporary
protection to supplement the present temporary duty provisions of
the Tariff Board Act. Mr. MeEwen pointed out that the present
temporary duty arrangements had given effective results but -the
Government felt that there were circumstances under which, as a
temporary measure of protection, the quantitative restriction of
imports may be desirable, combined with, or as an alternative to,
temporary duties.
" As made clear by the Prime Minister, the announcement of
a willingness to use import restrictions under these circumstances
does not signify any intention to revert to import licensing on a
wide scale unless required by serious balance of payments
difficulties. " There appears to be a misapprehension in some quarters
that the Government itself intends to identify the range of items
which require added protection by quantitative restriction and
make decisions accordingly. Provision of protection to Australian
industries has never been accorded on the initiative and judgment
of the Government itself. The initiative is always with industry
to request protection.
" No departure from thi~ s -principle is intended.
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" Broadly, two considerations are in mind. Firstly, as
visualised in the Prime M~ inister's Policy Speech in November, the
Government has recognised the particular difficulties of certain
Australian industries where production efficiency and a reasonable
cost level req~ uire the maintenance of a continuing high volume of
output. Where an inflow of imports has reduced the Australian
industry's share of the market so as to make an otherwise stable
industry unlrofitable and even perhaps uneconomic, it may be more
appropriate to apply quantitative limitation of imports, rather
than a temporary duty.
" Another circumstance wihich may warra~ nt temporary
protection through import restrictions may be that substantial
reduction of domestic demand resulting from general economic
circumstances operat ing in Australia, may reduce an Australian
industry to a serious situation unless the volume of imports is
temporarily diminished.
" The principle was established when the system of
temporary duties vwas introduced that an immediate reference by
made to the Tariff Board for normal consideration when a temporary
duty is imposed. This provision will also apply if import
restriction is provided as temporary protection.
" As the Prime Kinistor has already announced, a Special
Advisory Authority will bc established to advise on any request
for orotection by restriction of imports. Vnhere it is established
that imports are causing or threatonin3 to cause serious damage
to a particular industry, the Special Advisory Authority will be
able to recommend that any temporary protection shown necessary,
be given by means of temporary duty and/ or import restrictions.
This would not conflict with tho commitments Australia accepts
under the G. A. T. T.
The advice of the Special Advisory Authority could be
sought also in a situation in which a serious run-down of overseas
balances was threatened. This is an aspect of what the
Government has in mind, referred to in the Prime Minister's
statcment, that pressures which may develop should be dealt with
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by specifically designed measures.
" Action will be taken, Mr. 1-ci Ewen said, " to bring the
operations of the Special Advisory Authority within the a-mbit of
the Tariff Board Act. However, if real urgency exists, the
Special Advisory Aut. ority would be asked to advise the Government
on these matters even before the necessary legislative action is
taken." " In connection with the normal functioning of the Tariff
Board the Government proposes to amend the Tariff Board Act so
that under certain circumstances the Tariff Board after a full
inquiry may recommend that protection should include import restrictions
where the tariff alone would not give the necessary measure
of protection." Mr. IicEwen mentioned that representations had been made
recently to the Government, during its consultations with
various organisations, that it should be prepared to afford
protection to industries in respect of proposed extensions into
new manufacturing, or industries proposing to sot up manufacture
in Australia for the first time.
" If the Government feels that the question of protection
of a now industrial venture should, in the interests of the
economy, be considered in advance of actual production, it will
forward the matter to the Tariff Board for its consideration."
Mr. McEwen stated also that consideration is being given
to amending the Tariff Board Act, to ensure that requests for
protection are considered with a minimum of delay. For instance,
one opportunity would be to provide that evidence can be tendered
to the Tariff Board in writing, under a statutory declaration, and
made available to all interested parties unless accepted by the
Board as confidential, as an alternative to the existing
requirements that evidence be given in public on oath. The
existing procedures result in a considerable time -loss, especially
when witnesses have to read very detailed and lengthy evidence.
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" The Government regards the Tariff Board as an important
advisory instrument in enabling the Government to achieve the
national objective of continuing growth of the economy and employment
of the workforce. believe that industrial expansion at
a rate which will make an appropriate contribution to employment
can, as . the Prime Minister has said, be reconciled with a
reasonable stability of the Australian cost and price structure
and with a strong external position.
" The introduction of investment allowances in connection
with the establishment of new plant and equipment used in manufacturing
industry represents an encouragement by the Government
to the installation of the most up-to-date equipment. By world
standards the Australian home market is a small one and nothing
is more critical to keeping costs of production low in today's
industry than that our factory equipment should be abreast of the
world's most modern.
" Those investment allowances will, of course, embrace the
equipment of industries processing primary products, for example,
meatworke, butter factories, fruit and fish canneries, flour
mills and the like.
" The Gcvernment desires to sustain the rate of investment
in manufacture, for today's investment increases tomorrow's
productive resources and employment. Modernisation of equipment
and the modification of our policies of protection, combine to
better enable Australian industry to hold an adequate share of the
home market, produce at lowest achievable costs and so be bettor
enabled to reach out into export.
" While the Government is extending additional aid to
Australian industry, it is imperative that industry itself should
explore every opportunity to reduce costs. This should include
consideration of aspects of rationalisation and standardisation
so that productivity may be increased and costs kept low which
is so essential in a small volume market.
" The Government is anxious that the resources and services
of C. S. I. IR. O. should be availed of by Australian industry in
pursuit of greater productivity and cost reduction.
" The decision by the Government to re-inforce its existing
policies by the measures detailed above should be taken as an
earnest of the Government's intention to give effective support
to Australian industry in its essential role in fulfilling the
national economic objectives.
" The Government has shown it is prepared to play its
part". Mr. McEwen said the Government wishes to strengthen the
concept of partnership between Government and industry in pursuit
of the nation's high objectives.
Canberra, 11th February, 1962. 16/ 62T