CHECKC AGAINAT nELTVERY NMBARMOFn UNTIL flELYERY
SPEECH BY THE PRIME MINISTER
ADDRESS TO THE CATTLDID(' S UNION
NT ISA 26 AUGUST 1991
Mr Chairman, I regard it as an honour to come here to Mt Isa
to talk to the Cattlemen's Union today.
Facing up to you blokes reminds me of the story of the cocky
who bought a very expensive prize bull. A couple of days
later the stock agent who sold him the animal drove past and
saw that it was hard at work hooked up to the plough.
Thinking this was a bit of a waste he asked the cocky why he
was using an expensive asset in such a way. Surely it would
have been better off doing what bulls do best.
The cocky said, " I just want to show the beast that
farming's not all romance.*
Coming here I feel a bit like that bull.
Mr Chairman,
You have come from places all over Australia to attend this
conference. Many of you, being cattlemen, have come from
remote places in our vast Continent. But wherever you have
come from, you will I know have been fascinated, as I have
been, by the extraordinary events in the Soviet Union last
week; so ominous and menacing at the start, but moving sCo
swiftly to such a splendid resolution.
As cattlemen you are all international traders, and you all
know how interdependent the world has become. I am sure you
understand that the events in Moscow last week will be
important for all of us. In Parliament last week, I
expressed our delight at the outcome, and our admiration for
those who made it possible. Today I want to start by taking
this first and very appropriate opportunity of a major
speech to explain briefly to you, and through you to
Australians everywhere, what I think is the broader
significance of these events.
Between Monday and Thursday last week, we witnessed one of
the pivotal events of the century. I want to explain why,
when I say that, I mean exactly what I say.
9
From where we now stand, only eight years from its end, we
can see that the history of thiis century has been the
history of the struggle by people all over the world to
achieve or to defend political and economic liberty.
These liberties are ideals which have been evolving in our
civilisation for many centuries. But it has fallen to this
century to try to build social, political and economic
structures which would bring those ideals to life for all
people, everywhere.
In that long struggle, ideologies have carried the banners.
This has been the century of ideologies. But where the
ideologies have been strongest, it has been easiest to
mistake the means for the endi; to betray the ideals to
defend the ideology. So much of the history of our century
has been the histor-y of such betrayals. Nowhere has that
been more true than in the tragedy of the Bolshevik
Revolution, which promised the Soviet people so much, and
has given them so pitifully :: ittle.
For them, and for all of us, the events of last week mark
the decisive end of that tragedy. Last week the oldest and
greatest of the Communist systems showed, at last and beyond
any question, that it is weaker than the will of its own
people in their striving for political and economic freedom.
The ideal has defeated the ideology.
It is obvious what this means to the Soviet people
themselves. For them, the sczenes we saw on our screens last
week are the most exciting and auspicious since Lenin
arrived at the Finland station in October 1917. Now, as
then, a coup has ended, and a revolution has begun.
Today the people of the Soviet Union have the chance to
define their nationality and rebuild their society anew. it
will not be easy. But they have great material and
9piritual resources. We wish them well, and we will help
where we can.
For other nations still held by tyranny, last week's scenes
must mean hardly less than they do to the people of the
Soviet Union. They are a bright beacon of hope.
For the world as a whole, the events of last week show that
the spirit of international cooperation which has grown in
recent years is deeply rooted in the strongest soil. They
challenge us to expand that cooperation.
The world can stand united to0 confront aggression, as we did
a year ago. And the world can speak with a single voice to
support freedom and deter tyranny, as we did last week. So
we must wonder why the world cannot learn to cooperate
better to serve the important interests we share in other
areas as well. I113 t
At the moment, no international issue is more pressing than
the future of the Uruguay Round. Since 1986, when the
Uruguay Round began, the world has changed so much because
in so many areas we learned to apply the harsh lessons of
the past to avoid the mistakes of the past. But in world
trade we seem to be in danger of repeating the terriblo
errors of the 1930s, which produced not just poverty but
war. Time is running out for a successful conclusion to the
Uruguay Round of the GATT. Nine months have now passed
since the failure of the ministerial meeting in Brussels
last December. Unless real progress is made by the end of
this year or very early in 1992, the political momentum
required to conclude the Round successfully could be
dissipated. of course, there are many reasons to be worried
on that score, but the most obvious is that once we get into
1992, the United States will go increasingly into election
mode. The importance of a successful outcome to the Round for the
world economy and for Australia, including of course the
beef industry, is as high as ever.
We are absolutely committed to the need for a balanced
outcome in the Uruguay Round. No one can afford a deail that
perpetuates the gross waste of the world's scarce resources
that presently occurs. The Common Agricultural Policy of
the EC, the EEP policy instigated by the US to combat it,
and on a lesser scale the import restrictions in Japan,
Korea and other countries, all add up to an intolerable
situation for Australian primary producers.
It cannot, and will not, go on forever.
Success in the Round will be of lasting benefit to your
industry. If we can implement changes that see the lowering and
eventual elimination of export subsidies, then, but only
then, the Andriessen assurance that EC subsidised beef
will not be dumped onto our North Asian markets would
become redundant.
The overwhelming responsibility for a successful conclusion
to the Round rests with the Europeans. As I wrote to the
leaders of the G7 meeting before the London summit last
month, the key to the future of world trade is GATT; the key
to GATT is the Uruguay Round; the key to the Uruguay Round
is agriculture; and the key to agriculture is reform of the
European Community's agricultural protection policies. The
Europeans are principally responsible for the corruption of
the international market in agricultural goods, which
adversely affects this country and other free traders in the
Cairns Group.
' k) 32
We welcome signs that the European Community is addressing
serious reform of the Common Agricultural Policy. As for
the Uruguay Round, we do not make unreasonable or inflexible
demands that has not characterised the approach we have
taken, either individually or in our role as leader of the
Cairns Group but we do seek qp~ nifir and concrete
commitments in each of the three areas of internal support,
border protection and export subsidies.
I have asked the Leader of the Opposition to join the
Government in sending a bipartisan mission to Europe to
press Australia's concerns about these issues. The mission
will be led by the Minister for Trade and Overseas
Development, Dr Blewett.
Beyond that, it is essential that world leaders maintain a
close personal interest: in the Uruguay Round, as it may well
be that direct involvement by Heads of Government will
become necessary to secure an outcome to the Round. if so,
you may be assured tha': I will be at the forefront of those
efforts. Under GATT, imperfect as it is at present, we have achieved
important liberalisation in the Japanese and Korean beef
markets. Korea has an obligation to remove, by July 1997 at
the latest, import barriers introduced for balance of
payments reasons. Japan has moved to a tariff-based import
regime with tariff reductions from seventy per cent in April
1992 to fifty per cent by April 1993.
Japan and Korea currently account for about 37 per cent of
Australia's total beef and veal exports. By 1995-96 these
two markets are projected to account for as much as 47 per
cent of our total exports.
Australia continues to supply seventy per cent of Korean
imports. In 1991, Korea is expected to import 100,000
tonnes, well over the 62,000 tonnes minimum access level.
The challenge is to ensure improved access for the period
after 1992. The Australian industry will also need to adapt
to be able to satisfy the changing pattern of demand as
higher incomes lead to consumers preferring boneless cuts of
grain-fed product. Without industry development to meet
this demand change, the US will have an edge in the Korean
market. Japan's movement to a tariff-based import system is expected
to lead to a substantial improvement in demand for imported
beef. Whilst the initial change will lead to some
constraints as the market adjusts, the tariff reductions
should boost demand. The forecast is that our sales could
increase to 320,000 tonnes by 1996, or by over 65 per cent
on this year's expected sales.
Mr Chairman, the US has been our largest export market since
the mid-sixties. Sales are expected to remain firm. This
year's projected sales of 370,000 tonnes is up on last year.
There is the possibility that the US Meat Import Law trigger
level will be exceeded, raising the prospect either of the
US Administration negotiating Voluntary Restraint
Arrangements ( VRAs) with suppliers, or a quota set at the
trigger. That would mean a 10% reduction in our access.
The next US quarterly consultations with supplying countries
will be held this week, after which the position, and
whether the trigger level will be reached, will be clearer.
Officials mest with the Cattle Council last week, and there
will be further consultations with the industry in the weeks
ahead. In the long term, the challenge is to have trade restricting
measures, such as the US Meat Import Law, removed.
Mr Chairman,
Today we do have a lot to thank the cattle industry for.
Australia has prospered on the sheep's back, but today is
increasingly riding on the back of the cattle industry,
which now contributes 15% of the total gross value of farm
production and is Australia's third-largest rural
export-earner.
In this period where the world trading environment is so
distorted and where commodity prices, for the most part,
have nose-dived, the beef cattle industry is doing fairly
well. This is in no small measure due to the
resourcefulness, creativity, energy and sheer hard work of
those involved in the industry. The work done to adapt
different breeds of cattle to Northern Australian conditions
is but one outstanding example.
Looking to the medium term, saleyard cattle prices are
projected to increase until 1993-94, which reflects keen
demand by existing producers and new entrants responding to
the favourable medium-term export outlook.
Cattle numbers are forecast to reach 28.5 million head by
1995-96 and slaughterings projected to rise to 9.6 million
per year.
By 1995-96, production looks like being 19% above the
1990-91 estimates.
Because growth in production will be in excess of the growth
in total demand, prices are projected to fall after 1993-94.
The rate of increase in the retail price of beef is also
projected to slow, which should increase retail demand.
Total per person beef consumption is projected to increase
to 42.5 kg by 1995-96.
93 4
* Beef production costs are projected to increase, which means
we should plan for an increase in efficiency or face a
decline in profitability in the mid-. 1990s.
Mr Chairman,
Some of you might recall the first time I addressed the
Cattlemen's Union, which was in 1977 when I was President of
the ACTU.
What I talked about then was the need for us to work
together so that we might achieve consensus for the
betterment of your industry and all the people who work in
it. As Prime Minister, I say the same thing today. We must work
together. The economic future of this country depends on it.
The Australian meat industry is characterised by a maze of
complex awards and over-award agreements. Its workforce is
made up largely of pieceworkers. ' Work is repetitive and
conditions uncomfortable. Training is deficient, career
paths and job security are, by the standards of many other
Australian workers, deficient. So too are standards of
workplace health and safety.
Such an environment is a breeding ground for discontent and
mistrust. If we are to overcome the legacy of generations of poor
relations between employers and employees, and create an
environment in which this industry can raise its
productivity and efficiency, a major attitudinal change is
required. As I said, we Government, unions and employers
must strive to work together.. Employers and unions must
change their traditional adversarial approach. They must
address their combined prcoblems in the long-term interests
of the industry. Such changes ' are already occurring in some
areas but there is still a long way to go.
To this end, we believe that t~ e establishment of a
tripartite consultative committee Employers, Government,
and unions at industry level would be a key factor in
improving communication between unions and employers in the
meat industry. The same kind of arrangement should also be
set up at the plant level.. Consultative arrangements like
this have been crucial in other industries, such as vehicle
manufacturing and iron and steel production.
Mr Chairman
My Government has been an active participant in the pursuit
of industrial relations reform in the meat industry.
We have provided funding through the Workplace Reform
Program to help the Meat and Allied Trades Federation of
Australia and the relevant unions with award restructuring. .9; 1
In Queensland, we have helped the drafting of a consolidated
model award to apply to the export sector. The aim is to
reduce substantially the number of job classificationsi in
existing awards, create greater flexibility in working
arrangements and skill utilisation, and to develop career
paths. My Government is also awaiting the results of the Australian
Industrial Relations Commission Inquiry into the Meat
Industry, as it should provide a basis for further reform in
the industry.
Mr Chairman, I know that some of your members have been
worried about foreign investment in your industry
particularly as it relates to ConAgra.
But Mr Chairman, your industry has since its inception
depended on foreign investment to get where it is today.
Imagine the industry's development without the significant
capital injections that started it last century. Imagine it
without the innovation of frozen meat transport, or more
recently the development of grain feed-lot capacity.
The concern about ConAgra is to my mind a misplaced concern.
Your industry body, the Australian Meat and Livestock
Industry Policy Council, has submitted foreign investment
guidelines to the Government.
While those guidelines are still under consideration,
ConAgra's purchase of Elders meat division does fall within
them. In the ConAgra case, we required that the shareholders
agreement for the meat business provide for at least fifty
per cent of directors to represent Australian interests and
that ConAgra report back to the Foreign Investment Review
Board on developments within the meat industry generally
within twelve months.
Mr Chairman
I know that cost recovery for the Australian Quaranti. ne and
Inspection Service ( AQIS) is also a major concern for you.
The Government's decision to introduce full cost recovery
for services provided by AQIS from 1 January 1991 was made
as part of the micro-economic reform process. It ensures
that all users of the inspection service pay for the
services they require.
We fully expected that the introduction of full cost
recovery would lead to debate about the quality, type and
cost of services provided by AQIS. Such debate is a natural
and desirable consequence of this charging policy, as it is
only with such debate that the most efficient services can
be provided.
Those paying f or the ser-vice are fully entitled to pressure
AQIS to ensure they get the most efficient and effective
inspection service possible.
It must be emphasised that Government-certified inspection
is in some cases the only means of access to overseas
markets and the only way of ensuring that information on
product quality is available to assist the producer. It is,
therefore, in the interests of both the industry and AQIS to
ensure that cost-efficient services and effective product
monitoring is carried out.
Mr Chairman,
Last week also saw my Government's ninth Budget. That
Budget was the third instalment of policy decisions which
have made i991 the year of the most substantial and farreaching
economic reforins, not just in the life of this
Government, but in the entire post-war era.
That is a large but completely justifiable claim.
The Budget must be seen in the context of the continuing and
comprehensive process cf reform on which we have embarked.
It must be assessed in the context of the landmark programs
we have placed on the national agenda, including those
already being implemented, such as the abolition of the
two-airlines policy and telecommunications reform both, I
might say, crucial to the future of Northern and outback
Australia. In the quest for a sustainable and internationally
competitive economy, in this year alone we have set in train
through the March Statement the acceleration of
unprecedented tariff reform: taxation reform, notably the
simplification of depreciation provisions, and the widening
of sales tax exemptions: and resource security.
Again in 1991 alone, the commitments undertaken through the
Special Premiers Conference process are fundamental to
economic reform.
The July Special Premiers Conference agreed to establish the
National Rail Corporation, the National Road Transport
Commission, and the Electricity Grid Management Council, and
to business deregulation which will sweep away the stupidity
of having six sets of regulations around our nation. These
are all major reforms which are fundamental to building a
competitive Australia.
It is in this broader context of reform that the Budget must
be viewed, and it is against that background that I want to
emphasise some basic points about the Budget itself. () 3? 7
9.
First, and most importantly, the Budget will underpin
economic recovery over the course of 1991-92. Unemployment
will go higher in the short term something I regret deeply
but sustainable job growth will resume in this financial
year. For a Labor Government, high unemployment cuts to the quick.
We could easily have attempted artificially to pump-prime
the economy. But we resisted that, because it would have
simply put us back on the path of the cyclical boom-and-bust
periods which have for too long characterised the Australian
economy. Any jobs created in the boom would have been more
than of fset by the jobs lost in the subsequent bust.
Second, while the Budget is the first in five years to
provide for a deficit, all spending initiatives are fully
offset by savings. We have protected the structural
integrity of the Budget while at the same time taking
initiatives, especially for families and disadvantaged
groups. Third, the changes to Medicare are designed to further
entrench~ a great reform into the Australian landscape. The
problem of overservicing had to be addressed. We have done
it in a way which preserves the fundamental characteristics
of Medicare and in a fair way which protects those least
able to afford it and those in greatest need.
Finally, this is a Budget containing far-sighted reforms in
the area of superannuation. Like Medicare, it would have
been easier to duck the problem. Instead, we have tackled
it head-on and, in doing so, have laid firm foundations for
the retirement incomes of our rapidly ageing population into
the twenty-first century.
in the ninth Budget of my Government, we are still taking
the tough decisions, we are still doing what is best for
Australia's long-term interest. We have always drawn some
flak for our tough decisions. But the Australian people
have always recognised and rewarded my Government for
displaying a commitment to the long term. I believe they
will continue to do so.
Mr Chairman
My Government is acutely aware of the difficulties currently
being experienced in rural Australia.
938
i't propose to reiterate Budget details which you
3dy know, but I will mention one major reform which
fits families in rural Australia those families which
as we say, asset rich but cash por. The introduction
n assets test on the family allowance, at a threshold of
:, 000 net of debt and excluding the family home, has been
) mpanied by hardship provisions to protect asset rich,
poor families. For two years from 1 January 1992,
. lies will continue to receive the Family Allowance
3onent of the Family Payment regardless of the value of
ir assets if current income is less than the basic rate
Social Security benefit S13,078 plus S624 per child
liquid personal assets are less than $ 10,000 in the case
a couple.
im the same date, families meeting the above tests and
: h net business assets up to a value of $ 600,000 will
; ome eligible to receive the equivalent of the present
nily Allowance Supplement under the new combined Family
Yment. Under the new arrangements, families could be
igible for family assistance payments of up to about $ 50 a
ek per child.
have also put in place a strategy to facilitate rural and
! gional development. To reduce gaps in rural and regional
! rvices and to promote the diversification of rural and
3gional economies, we have introduced new measures in the
991-92 Budget with additional funding of $ 2.3M in 1991-92,
nd S4.3M in both 1992-93 and 1993-94.
ike the Budget as a whole, these treasures need to be seen
gainst the background of Government action through the
ear. In particular, the then Minister for Primary
ndustries and Energy announced in April an increase in
unding for the Rural Adjustment Scheme by Sl00M to S160M in
991-92. This assistance is directed to those farmers most
n need and gives the Commonwealth the capacity to support
P to S1.4bn of rural debt in 1991-92.
n addjition to these programs, the Government recognises the
articular mix of difficulties facing the residents of
orthern Australia. A Northern Australia Social Justice
trategy is to be developed over the next year, in
Onjunction with a Northern Australia Economic Strategy.
r Chairman, in conclusion let me say that whenever I come
Northern Australia, whether hece in Mt Isa or in Darwin,
orth Queensland, or the Kimberleys I realise once again how
he economic and social balance in Australia is changing.
outherners, more and more are coming to see that where the
wentieth century has been dominated by the south, the
wenty-first will swing to the north.
attlemen knew that a long time ago, and if there is one
riticism that I might make, it that you have kept the
ecret of Northern Australia to yourselves for too long. BONBON EN-
SThe fundamental changes my Government has made in the
economy of Australia, whether in encouraging tourism in the
North by abolishing the two-airline policy and protecting
our wonderful environmental tourist attractions, or
redirecting our trade efforts towards our Asian and Pacific
markets, have changed, and benefited Northern Australia more
in the last nine years than in the previous ninety.
But whatever the future holds for Northern Australia one
thing is for sure cattle and cattlemen will play an
important part in it.
Thank you.
0910
W