STATEMENT BY-TIEPRTE ISE
( The Rt. Hon. R. G. Menzies, Cli, QC, MP.)
HOUSE OF REPRESENTATIVES
WEDNESDAY, 17TH OCTOBER, 1962.
ANNOUNCEMENT OF ECONOMIC ENQUIRY
Over recent years the Government has had requests
foj. a-nujber of organisations for public enquiries into
various aspects of our economic affairs. Some of these requests
have related principally, if not wholly, to the Customs Tariff.
Others have sought a wider coverage and, at the extreme, have
wanted an enquiry to comprehend all the main aspects of our
economic affairs. The Government has given much thought to these
requests. It has found difficulty in seeing that an enquiry
limited to the tariff, or any particular aspects of the tariff,
would be a sufficient undertaking. Apart from anything else
there would be great difficulty in confining any enquiry to Lhe
tariff because that subject is connected with and dependent
upon so many other issues. On the other hand, a general economic
enquiry, as some have proposed, might have to become almost
illimitably wide, take more time than is justified and by its
very breadth, lead to conclusions so broad and vague and
qualifiud as to be of little practical use. We have decided,
therefore, to institute an enquiry of a particular kind.
We feel that it should serve the requirements of
the widest number of people and organisations, that it should
be helpful not only to the Government and its various agencies
but also to trade and industry, to all who play a constructive
role in the growth of our economy. What we all need is light
upon possibilities rather than guidance upon how to go about
achieving this or that objective. We hope to have drawnm upas
far as it is possible to do so with the information that
can be had a chart or prospectus of our economic potentialone
that would show both the extent of our resources and their
capabilities and also the limitations upon those resources.
It would also be valuable to have some competent
and objective advice of an analytical kind upon certain great
questions regarding the best use and disposition of our resources,
For it is one of the fundamental facts about our economy that
while many of our resources, so far as we know them, are good
in point of quality, they are also limited in extent and subject
to various handicaps upon their development. This makes it of
the first importance that we should put them to the best and
most productive use.
These are the main considerations which have guided
the Government in drawing up terms of reference for an enquiry.
These terms of reference are as follows
" HAVING IN MINI) THAT THE OBJECTIVES OF
THE GOVERNMENTIS ECONOMIC POLICY ARE A HIGH RATE
OF ECONOMIC AND POPULATION GROWTH WITH FULL
EMPLOYMENT9 RISING STANDARDS OF LIVING EX( TERNAL
VIABILITY, AND STABILITY OF COSTS AND RICES,
TO ENQUIRE INTO AND REPORT ITS FINDINGS ON THE
FOLLOWING MATTERS
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TIE TRENDS IN POPULATION AS A alHOLE AND
IN THE WORK FORCE COMPONENT;
THE AVAILABILTITY OF KNOTWN BASIC PHYSICAL
RESOURCES;
THE GROWTH OF DOMESTIC SAVINGS;
OVERSEAS INVESTMENT IN AUJSTRALIA ( INCLUDING
LIKELY SOURCES AND TRENDS AND AN ASSESSMENT
OF ITS SIGNIFICANCE TO THE AUSTRALIAN
ECONOMY);
THE LIKELY PATTERN OF GROWTH AND GEOGRAPHICAL
DISTRIBUTION OF INDUSTRY, PRIMARY, SECONDARY
AND TERTIARY ( INCLUDING THE GOVERNMENTAL
SECTOR);
THE CONSEQUENCES OF THIS FOR THE OCCUPATIONAL
PATTERN OF THE WORK FORCE;
QUESTIONS INVOLVED IN THE PRODUCTION IN
AUSTRA" LIA OF GOODS THAT WOULD OTHERWIISE
BE IMPORTED;
THE DEVELOPMENT OF PRODUCTION FOR EXPORT
AND THE SECURING OF ADEQUATE EXPORT
OUTLETS; AND
THE EFFECT OF CUSTOMS TARIFFS AND OTHER
FORMS, DIRECT OR INDIRECT OF PROTECTION
ON THE DISPOSITION OF RES6URGES AND ON
THE BROAD ECONOMIC OBJECTIVES STATED
ABOVE. I
As they s-tand, these terms of reference are largely selfexplanatory
and need no great elaboration. No doubt, when the
Committee which is to conduct the enquiry has been assembled,
we will have some discussion wi1' th them so that they will be
quite clear in their minds as to what it is the Government
wants them to do on its behalf and for the community.
Appointments to the Committee will be made as
soon as possible. it is not intended to establish the body as a formal
Royal Commission. Within its terms of reference we want the
Committee to hiave the greatest possible freedom in deciding how
it goes about its work.
The Committee will obviously require considerable
staff assistance and we shall certainly see, to that. It -also
seems likely that the Committee will w'ish to call on various
people or institutions to undertake special enquiries. The
facilities of relevant Commonwealth. Departments and authorities
will be available to the Committee, and we do not doubt that we
will also have the co-operation of State Governments and their
associated authorities, so for as this is necessary.
Especially do we hope that industry, in its various
branches, will co-operate in making information av. ailable and
perhaps in undertaking investigations which only they are
capable of carrying out. It should be emphasised again that,
in the degree that it is successful in throwing light on our
economic future, the results of the enquiry can be of great
value to industry and trade as well as to governments. 9a & / 3
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For its part, the Government hopes that the enquiry
will be helpful to it in providing information which will help
it in the determination of many fundamental issues of policy,
Amongst these, obviously, will be the important issue of tariff
policy in its broadest aspects. It should help particularly
in setting the role of the tariff in its due context and
perspective and integrating it with economic policy as a whole.
Naturally the Government will wish the report of
the enquiry to be available to it as early as possible. At the
same time it realises how wide and complex and difficult are
the subjects it is putting before the Committee and it has not
therefore laid down a fixed period within which the Committee
should make its final report. That is something on which it
will talk to the Committee when it has been brought together.
The Government wishes to make it clear that it has
the firmest intention of preserving the full independence of
the Tariff Board as an advisory body established by Parliament,
its system of open and public enquiry and its high public
standing and prestige. These things are of the very essence
of the Tariff Board system which has, over many years, served
Australia well and has won admiration and respect overseas.
The Tariff Board is, to repeat, an advisory body.
It is not a policy-making body although its recommendations
necessarily have a considerable influence on policy and it
is not an executive body. Its principal and best-known function
is to consider, on reference from th, Government, applications
for protection by way of tariffs or bounties or, alternatively,
proposals for the reduction of such protection. It also has
power on its own initiative to review existing duties, to
conduct enquiries on certain matters and to report to Parliament.
But tariff policy as such is the responsibility of
the Government. Only Parliament can enact tariffs; only the
Government proposes tariff legislation to Parliament.
The tariff and other forms of protection such
as bounties and subsidies are means to provide a degree of
shelter for local industries against the competition of imports
from other countries and so to sustain and promote the growth
of these local industries. Protection has been the policy of
all Australian Governments since Federation. Our own policy
is clear; we are for effective protection for efficient
Australian industry. Tariff policy involves broad issues of principle
how far one class of industry should be encouraged by protection
as compared with other classes of industry, whether diversity
of industry should be sought or specialisation, what relative
weights should be given to the effect of tariffs on costs
generally, on rural incomes and on consumers, how far international
reactions to tariff increases should be taken into
account and so on. But tariff-making is also a matter of
decision in individual cases within a general framework of
principles and under a changing context of circumstances. In
that sense, tariff policy is built up and elaborated, precedent
by precedent. It is equally apparent that policy on tariffs and
protection generally must form part of, and be consistent with,
economic policy as a whole. It must serve the same broad
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-obje-ct-ives of policy, external as well as internal. It clearly
must be related to overseas trade policy our relations with
other countries as well as to internal policy on the industries
which provide the exports for overseas trade. it must be
related to population growth and full employment but it must
also be related to the problem of costs and prices.
More and more as our experience widens, it is
borne in upon us that sound courses of action depend on our
ability to see ahead and, having seen ahead, to prepare
a head. The need for more information and better information,
more light on what is going on today, what may or may not be
going on tomorrow or next year or the ne: ft five or ten years,
is common ground with everyone. Business demands,. rightly
enough, to know what thec Government is trying to do, what
its objectives are and what its lines of policy will be.
The Government, on its part, feols the need to know more of
what business hopes to do and plans to do.
The work of the Committee should help us all.