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Transcripts from the Prime Ministers of Australia

Transcript 2685

CONFERENCE OF THE PRESIDENTS OF THE NATIONAL MANUFACTURING INDUSTRY ASSOCIATIONS - SPEECH BY THE PRIME MINISTER, THE RT HON WILLIAM, MCMAHON CH MP - 4 OCTOBER 1972

Photo of McMahon, William

McMahon, William

Period of Service: 10/03/1971 to 05/12/1972

More information about McMahon, William on The National Archive website.

Release Date: 04/10/1972

Release Type: Speech

Transcript ID: 2685

CONFERENCE OF THE PRESIDENTS OF THE
NATIONAL MANUFACTURING INDUSTRY
ASSOCIATIONS
Speech by the Prime Minister, the Rt. Hon. William
McMahon, M. P. 4 OCTOBER, 1972
Mr. President and Gentlemen:
This visit gives me the opportunity to welcome you
collectively to Canberra and also to say something about the
matters of special interest to both Government and industry.
First, let me say that I am giving close attention
personally to the representations you have made in recent months
about the future of manufacturing in Australia, about current
matters like the tariff review and trade practices, and about the
Government's administrative system for dealing with manufacturers
and manufacturing policy, and about the state of the economy in
general. Let me take this last point first because it is against
the background of the state of the economy that we measure the
progress and the prospects of manufacturing industry.
I believe that the worst is well behind us and that
steadily and deliberately the economy will continue to gather
strength, providing there are-no self-inflicted injuries resulting
from prolonged industrial trouble and industrial lawlessness, and
always providing that when wage increases take place, productivity
increases are not far behind.
The level of unemployment is being watched closely and
the Government has already taken corrcctivc measures, through the
Budget and other ways, to ensure that-unemployment falls.
I am completely confident that we can overcome the
problem to the satisfaction of the Australian people and the
discomfort of the Labor Opposition and ' he President of the ACTU.
To my mind it is tragic that there are sufficient numbers
of people about who seem to have a ves~ ted interest in unemployment
for purposes of political advantagi! that they can conmmand
headlines in the media to the ext _ nt t:. iat they do.. 2

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This is a time when by word and deed we should
demonstrate confidence, each in our own way and in our own field.
I ask manufacturers to join the Government in approaching the
problems of the day in this fashion because manufacturers have
an honoured place, a vital place, indeed an indispensable place,
in this industrialised society of ours.
Now I want to mention two or three matters
as a positive act of reassurance by me, because i am aware that
some of you are a little uncertain and anxious about the effect
of Government policies on manufacturing industry.
I refer to policies like the Tariff Board
review which is already in progress and the revision to the
Trade Practices legislation which has yet to comb before the
Parliament. Here and now, I want to assure you that our
fundamental political philosophy is unchanged. We are committed
to the free enterprise philosophy, because we know it works to the
benefit of the whole Australian community and that our policies are
related to, and do not displace, that philosophy.
I have told manufacturers on other occasions
that neither I nor the Government will do anything to compromise
the future of economic and efficient Australian industries, and
more than that, we will continue to encourage and provide incentives
to those industries. We seek your counsel and co-operation regularly.
And we are Prepared to give the most careful consideration to
ways and means of developing both those practices, if necessary
by new arrangements. Mr President, in the last eighteen months, the
Government has taken a new look-at every major field of Government
activity. We have restored the investment allowance
decided to continue the financial incentive
provided under the Industrial Research
and Development Scheme for a further five
years
-decided to extend the export incentives
scheme beyond 30 June, 1973
-made the most significant amendments to the
Conciliation and Arbitration Act since 1947
-announced important new measures on overseas
takeovers
and we will table the llono-, Dlies Commission and Trade Practices
Bill and we will give time for informed public de-bate before we
legislate.

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This to my mind is a sensible way because we get
the benefit of public reaction, suggestions and criticisms before
the final commitments are made.
Of course, you have to live with criticism that
you can't make up your mind quickly. But surely there is merit in
such a course. A " hit and miss" policy would be as dangerous as
the application of doctrinaire socialism to the business life of
this country. And, believe me, those are the only alternatives
to the way we act. Now, Mr President, may I say a word or two about
tariffs. It's pretty clear to me that our tariff policy is still
under fire from some groups. So let me go over some of the ground
again very briefly. As a general principle, let me say this. In
all industry matters within its jurisdiction, including tariffs,
the Government is the body which makes the final decisions. It
does so with a full exposure of the facts. It does so after taking
the advice of its experts and considering the recommendations of
its committees, tribunals and appointed authorities.
The advice it seeks is objective and non-political.
It comes from specialists, researching, studying and examining
specialised fields. It is a major factor in political decisionmaking
but it is not the only one. The decision a Government
takes has to be made in practical terms. The theorist has his
value and he is important. But he is not the decision-maker.
The Government is the decision-maker and has to
take into account the national interest, the industry interest
and whether a proposal can really work or not. It has to make
its decision against a far wider background than the one against
which its advisers, by the nature of their specialty and their
brief, have tD work. Now, I've heard the Tariff Board described as
a " bunch of theorists". That isn't fair to the able men on the
Board. And I think that kind of criticism stems from an over-ready
assumption that a Board recommendation becomes the Government
decision as a matter of course.
The Tariff Poard's current review of the high areas
of the tariff which should be completed in about six years is, as
you know, concerned with identifying any excess protection which
may exist.

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In recent months, some manufacturers have sail"
they would like to have advance indication of the timing of the
enquiries under this review as far ahead as possible to help them
in their policy making. Yesterday, as you no doubt know, the Tariff
Board issued a publication which sets out its timetable for the
thirty-five industry references which will take it up to 1978.
The Board's programme gives proposed. sequence and duration of
individual enquiries. This publication is avaiable from the Tariff
Board in Canberra and I hope it will go a long way to meeting
your wishes in this matter of timing.
You will appreciate as the Deputy Prime minister
has said yesterday, that it was desirable to have a broad
timetable and that somne flexibility will be needed by the
Government in the exact timing of references. I want to assure
you, too, that you will have advance indication of the timing
of review enquiries as far ahead as Practicable.
Now I want to emphasise that the Government does
not see this review as challenging either the principle of the
practice of protection. The Tariff Board works in the knowledge
that the Government's long-established policy is one of full
adequate protection for economic and efficient Australian
industries. That hasn't been changed and won't be changed.
Both my colleague, t%-he Minister for Trade and.
Industry, and I have repeatedly stated this in the past year or
SO. But what I do want to do today is to stress
those " other factors" which arc taken into, account when the
economics of an industry are under study. These " other factors"
have their relevance in any study of the best way to allocate
and use our national resources.
One is a defence consideration. An industry
which has a 3otential contribution through somne sector of its
operations to our defence resources is entitled to, and will
get that potential recognised in any tariff decision.
Another is the industry which may not be able
to survive without protection above the level assessed exclusively
in terms of its cost disability against imports, but which employs
special classes of labour which we want to encourage, or which
may be developing special skills and technology.
I remind you of our recent decisicns in the
case of woven and knitted shirts. We decided that to achieve an
orderly transition to a lower level of protection, the existing
level would be maintained for a longer period than was recommended
by the Tariff Board.

In the meantime, the Government negotiated for
voluntary restraint arrangements with low-cost countries to ensure
that the manufacturers were able to keep going. However, despite
these negotiations, it was not possible to reach acceptable
agreements, and the Government therefore decided to establish tariff
quotas on competing imports to ensure that the local industries did
not " go to the wall". The point I want to emphasise over and over again
is that if tariff actionisconsidered necessary by the Government to
achieve rationalisation, then firms would not be expected to adjust
overnight. Special care would be taken not to put job opportunities
for Australians at risk.
Mr President, there are other examples, but my time
is short. The message I want to leave with you is that the Government
regards a strong, growing and prosperous manufacturing industry
as a great pillar of economic strength and wants it to grow and
expand. I state further that in the Tariff review and the
Government's approach to it, and in the proposed Trade Practices
reforms, the Government is encouraging healthy progress in a
competitive, free enterprise economy.
Our recent decision on foreign investment in
Australia is, I submit, further clear evidence of our desire to
foster Australian industry and to make it stronger, more efficient
and affluent.

Transcript 2685