TRANSCRIPT OF FARMERS FEDERATION OCTOBER 14,_ 1976
P. M. Inaudible If all sections of the commpnity could adopt an equivalent
attitude, I think we would work our way out of our difficulties
very quickly indeed.
The last few years and still the present, are obviously
difficult for rural industries. National prosperity can't
be built on a declining rural sector; on a rural sector that
is not adequately profitable. It can't be built if the
manufacturing industry isn't adequately profitable. All
industries and all Australians are basically independent.
The message from that address as I would understand it is
that there is a basic unity within the Australian nation
and all sections are, to some extent, dependent upon other
sections in the Australian community. It is no good believing
there will be prospetity in the factories and the cities
unless there is also prosperity in the country side.
We have had to give priority in our economic policies, as
you know to attacking inflation. Without that we won't
be able to restore profitability and both are essential
for rural industries.
In the wider community unless we sucessfully attack
inflation, there won't be adequate jobs for people in
Australia who want to work. Nothing destroys the incentive
to invest for industries to advance more quickly than the
kind of inflation that we have had over the past two or
three years.
In the months since the election we have brought Government
spending under control and as you know, in the May statement,
we have knocked off over $ 2,500 million in the estimates
of expenditure. We ended up with a growth of 11% in the
Commonwealth budget. It is worth noting that in all the
states there was a much more significant growth in their
budgetary expenditures than that. Some states still spent
19% more this year than last year. States have still tried
to come to usand say they haven't got enough resources.
They have really got enough resources. It is a question of
their own priorities. If some states want to have the
abolition of probate duties which is something most of
us probably hate the probate duties not the abolition
a higher priority than other matters, then that is a
matter for the state. But they can't pick up their own
high priority. matter's and then come to us for the matters
they put at the bottom of their list of priorities.
The growth in their budgets has been significantly greater
than ours.
In this question of bringing expenditure under control,
I think it is also worth just recalling for a moment what
we have done for local government. There, the increase
is 75% and up to $ L40 million and that was the largest
increase in our budget and for a very deliberate purpose.
We believe that there would be-too great a burden on rate
payers in many parts of Australia, especially in rural
areas and we hope that local government authorities would
use these funds at the very minimum, to hold rates steady.
Hopefully, even to reduce rates. I find that in some
parts of Tasmania, local government authorities have
increased rates by 20% in rural areas still in a time such as this
2.
I find that very hard to understand because the rate payers
can't stand these kinds of increases and all spheres of
government have got to understand also that they can't go
on spending more and more of other peoples incomes more
in real terms each year especially when our gross national
production is static, or as it was under the last year or two
of Labor, actually declining. That is what creates the squeeze
in the private sector. That is what creates the squeeze on
farmers.
When people come to us as they have on one or two occasions,
and said what can they do about local government that has
put up rates when they should hold them steady or even better
reduce them. There is a short answer of course because the
local government councils who makes these decisions are elected
councils and they have to come up for re-election. Therefore,
I would think it would be in the hands of rate payers themselves
to determine what they can do for councils who will not exercise
restraint in their own expenditure. I say that knowing quite
well that there are demands on local government that are
Important and have to be met. At the same time the increasing
funds made available this year was creating an opportunity to
local government to relieve the burden on their own constituents
and I believe they ought to do it.
in our own efforts to reduce expenditure, by the end of this
year, the Public-Service will be over 25000 less than it would
have been-under the guidelines operating under our predecessors.
I think that is-a significant decrease. It is probably the
first time for 25 or 26 years in which there has been an
actual decrease.-. It has been a slow and steady increase in
the size of the Service since November last year.
We have undertaken significant reforms in the Federal system
and I have spoken of these in relation to the states and also
in relation to local government.
We have fully-indexed personal taxes. This doesn't just apply
to this year, it applies again on the first of July next year
and everytyear thereafter so it stops the unlegislrated tax
increase-tht comes with inflation. The effect of it of course
is less, if inflation is less, as I hope it will be, as it must
be, but nevertheless there is a continuing benefit in that
particular legislation. It will require governments to be honest.
On other fronts we have legislated for secret postal ballots
in union elections. More and more unions are coming to conduct,
as they now must,, their elections in those ways.
We have undertaken specific measures expressing our concern
with the limits of the funds available to us for rural industries.
The investment-allowance applies to a large part of purchases.
for rural industries. I know it doesn't help very greatly,
the farmers who haven't got an income but nevertheless the
allowance is there and for some rural industries it is of
significant assistance.
The reserve price for wool has increased on the new basis
of and average 275cents a kilo on the old method of measuring
the reserve price.-the market price is strong at the momentto
provide longer termcstability, we said that that would
apply as a minimum, not only for this year, but also for next
year. Obviously we would hope to be in a position to be able
to review that in the manner in which Australia would want for
the next season. At least if it is established a mimium over
a two year period. I believe that indicates confidence in the
industry which is in some degree a contrast with earlier
attempts to reduce the floor price at a time when it was
just starting to regain some confidence, that a move by
the Government of the day which damaged confidence in
the industry, for probably the following six or nine months.
That I hope is past.
We are pressing to get the legislation of income equalization
deposit scheme introduced and passed in this session. There
may be some drafting problems in relation to that but I believe
we can do it. That scheme will at least apply to this years
income.
The negotiations and discussions fo~ r the establishment of a
rural bank are proceding and there is no doubt that that bank
is going to be established. We hope that existing banks in
this position will want to be involved in it with us but if
they don't the rural bank will be established in any case.
I would like to issue a slight note of warning in relation
to the rural bank. I suspect that some people think that
it will solve all problems. It can solve some longer term
problems where longer term finance is needed. We have also
said it will be available for the purchase of producers
equipment instead of having to go to hire purchase terms.
It is not going to solve the problem unless there are
adequate prices for the product the farmers have to sell.
That is basic to the whole operation.
The other thing can help and help quite considerably but
they can't overcome the basic situation if the return to
producers is inadequate.
There have been measures to help the beef industry in rural
reconstruction and there is no need I think for me to detail
these.
We are hopeful in the longer term and I can't place a time
on it, that the markets in Europe-. will open again for beef.
Also that markets in Japan will expand. This is going to
take a pressing because they have got their own domestic
beef lobby as we well know.
In the United States we are in the middle of an argument
at the present time because they are caught in a situation
shortly-before an election where immense pressure is being
brought by their own beef lobby and where the problem basically
has been caused not by anything Australia has done.
The problems are caused largely by imports from Canada
imports into the United States.
I think you probably know what has happened over the course
of this year. The Americans have got a practice of having
pre paid zones and beef was coming in
and Australian beef was been used for processing and entry
into the United States. This was legal. It was within
United States law. Indeed, an attempt was made at some
stage in the United States to make it unlawful for that
entry to come in and Congress wouldn't buy it. To relieve
the United States of.. pressure we said we wouldn't ship more
beef through after September 10. That again was
a voluntary action of ours. One that was within the law and
one that didn't have to be taken. We have done what we can
to assist them with that particular problem
out of their own law or lack of will to take action
against beef in But the real problem has come
from Canada. Canada has always refused t~ o be part of a
voluntary restraint arrangement into the United States. What
they have always done is pencil in the amount of beef they
think will come from Canada. This year they pencilled in 50 to
million pounds. It looks as if imports from Canada
will be about 100 million pounds and that is about the
extent of the United States problem for this import year
to them. What we have been pressing obviously is that
the quotas issued at the begining of the year should
remain and there should be no reduction in those quotas.
It has also been put in the strongest possible terms
that any discriminatory action against any one country
would not be something that the Australian Government
or people would be able to understand. At one stage
some of their officials were suggesting that the nice
way to overcome the problem was for Australia alone
to voluntarily agree to reduce its quota significantly
below the amount that had been allotted to us. In-other
words Australia was being expected to solve the problem
caused by Canada and that was quite unacceptable to
Doug Anthony and myself and the whole of the government.
I am sure it would have been quite unacceptable to all
of you.
What decisions they make about these matters I can't tell.
All I can say is, that I have been in direct'touch with
the President twice; once to Doug Anthony when he was
acting for me a few days ago; and on my own return I have
also spoken to the Embassy and L-ouri: officials-in the
United States are pressing the Australian case as strongly
as a case can be put. It is obviously a matter of significant
importance to beef producers over the next few weeks.
We have widened the support that is available for drought
in drought assistance.
We have joined in the contemplation of the slaughter of
cattle which is a solution to our problems that I don't
like but in certain circumstances a number of states
asked us to support that programme in this way and we
have done it.
I think there is some misunderstanding about the nature
of the government's support for drought relief. There
has always been a circumstance in which states meet
a certain basic expenditure which hasn't been ordered
for about 15 years, so with inflation it doesn't bear
much relationship to their own budgetary capacities.
They meet all the expenditure on agreed items up to
that base amount and after that we pick up the total
expenditure and go on picking it up without limit.
The states objected to this saying that it was unfair
that they had to meet the expenditure up to a base
amount. So we said if you don't like that arrangement
we will go dollar for dollar with you from the first
dollar spent. They have either choice, I think they
are going to stay with the old arrangement. The widening
of the drought assistance is reasonably forthcoming and
if there are new measures proposed that need to be examined
they will be promptly.
The superphosphate bounty has been continued and the IAC
recommended that it be continued. I think that struck some
of us with a degree of surprise in view of past history but
nevertheless the IAC on that particular incident made what
I certainly believe to be the appropriate and right decision.
I think that some other farmeis bcl ev-\ e it is the right
decision.
There are acute problems of apple and pear industry that we
know and measures have been taken by the government to try
and ease the burden in that particular area. Again a solution
that we don't like to problems. We have eased the eligibility
provision so that farmers can get unemployment assistance
and in certain circumstances I think that has been quite
essential. I think it is quite wrong that every other
group in the Australian community could be eligible for
unemployment assistance but a farmer, because he was living
on his farm even if he presently didn't have work to do, was
ineligible. Farmers in that kind of circumstance also of course are
particularly benefited from the new system of family allowances.
If you look at the percentage of people in low incomes and in
a number of primary industries, they would not have been able
to have benefited from the family rebates. Their incomes
just wouldn't have been high enough to get that benefit.
The new system of family allowances makes sure that that
family will benefit.
But we don't look to measures of that kind~ obviously as being
more than a short term assistance because the objective is
to move rural industries into a situation in which they can
be profitable and adequately stand on their own feet with
appropriate support and assistance and appropriate policies
from government to enable that to occur.
General economic recovery is critical to achieving that
objective. The economy is recovering. Indicators are
obviously mixed at this stage. After the events of the
last two or three years, the recovery is clearly going to
be slow. It is very easy to jam an ocean liner onto the
rocks but not so easy to get that ocean liner off the rocks
and sailing properly with all systems working well. We never
said it would be quick before the elections. We said it would
take the full three years to get the economy where we thought
it ought to be. The Government has great confidence in the
future of Australia's rural industry and it will be seeking
to take its part and make sure that it is a viable and
prosperous and happy future working in partnership with
Australia's rural industries I am sure together we can
achieve that.
Mr President, the spirit within the spirit of that paragraph
of your speech, your address that you read out, I have no
doubt about the outcome.
Gentlemen, I have great pleasure in declaring this conference
open.