No Ticket, No Start---No More!

The Industrial Significance of the 1978 Live Sheep Export Dispute

David Trebeck

    'Industrial relations were once considered complex until we simplified them somewhat.'
    Ian McLachlan, as NFF President, 1988.

    'Good luck, and when we're 95 per cent sure you're going to win, we'll be right behind you.'
    Government backbencher's good wishes to me at Canberra airport at the outset of the dispute, March 1978.

    'I sympathize with the farmers about the export of live sheep. The Government of South Australia has always been in favour of the export of live sheep and we have been endeavouring to encourage the trade. But there are two sides to the question and they need to be settled by the reasonable people. It is the extremists that have been taking the decisions... The Government hasn't failed in its duty in any way. What we have been endeavouring to do has been to conciliate this dispute. The fact is the people on both sides have been thoroughly unreasonable.'
    Don Dunstan, South Australian Premier,April 978.


The 1978 live sheep export dispute marked the turning-point in the handling of industrial matters in Australia after the decline which followed the O'Shea case in the late 1960s. In that sense, its importance as a precursor to many of the major industrial battles waged over the subsequent decade is difficult to overstate. It was important in the economic sense of safeguarding an emerging export industry which has earned Australia many hundreds of millions of dollars since. It was important in providing a major fillip to farm organisation amalgamation, leading to the formation of NFF in the following year. It was important in that it brought to the fore the leadership talents of Ian McLachlan, later to be President of NFF. And it was important in that in so many ways it revealed the shortcomings of government and Governments.

For all these reasons, the story of the live sheep export dispute needs to be told---appropriately in the forum provided by the H R Nicholls Society. While a great deal of media interest was generated at the time, little authoritative analysis has been undertaken since, to my knowledge. This task should be completed before the memories of those centrally involved fade too much, and lest any attempts by some to rewrite history gain credence. A decade after the event seems a more than adequate interval.

  • At the time of the live sheep dispute, I was Executive Officer of the Australian Woolgrowers' and Graziers' Council (one of the predecessors of the National Farmers' Federation) and was thus a 'bit' player in what occurred, albeit with the benefit of a ringside view. This paper would not have been written without the assistance and active encouragement of Ian McLachlan (then Chairman of the Combined Livestock Committee in South Australia), Sir Samuel Burston (then President of AWGC), Jim Samson (then President of AWGC's Western Australian affiliate, the Pastoralists and Graziers Association), Max Cameron (then Chairman of the Western Australian Livestock Export Committee) and Ted Cole (then Industrial Director of AWGC), all of whom were far more involved than I.

Development of Live Sheep Export Trade

Live sheep were first exported from Australia to Middle East countries in 1960. From an initial volume of 2,500 head in that year, numbers exported to the Middle East rose progressively to 800,000 head by 1973. Relatively minor quantities were also exported to other countries, including Singapore, Malaysia and Mauritius. The principal exporting State was Western Australia, with exports from South Australia---including sheep originally from Queensland, New South Wales and Victoria---becoming increasingly important from the mid-1970s.

The type of sheep being exported at that time were almost entirely aged merino wethers---well beyond their prime as woolcutters and of little or no value to the mutton trade in Australia. In other words, they were sheep which were otherwise close to being worthless.

Following the increased spending-power offered by higher oil prices, the numbers of live sheep exported rose steeply from 1974 to reach 4.8m by 1978. Kuwait was the principal customer during the 1960s; Iran took over this role in the (pre-Ayatollah) 1970s and exports to Saudi Arabia also grew in importance. Libya entered the scene as a major player somewhat later.

Middle East people are traditional sheepmeat eaters. Moreover---and of vital importance in the current context---they prefer fresh meat to chilled meat which is in turn preferred to frozen meat. This preference reflects both taste considerations and traditional customs, as well as the practical matter of no refrigeration in many areas remote from the unloading ports. Live sheep were often simply walked from the port to more distant settlements where they were to be consumed. 'Storage' was thus relatively easy in the form of live animals. Similarly, in the immediate aftermath of the rise in oil prices, there was massive congestion in most ports which also meant that live animals were more flexible and less vulnerable than a perishable product. Another factor is that live sheep are required at particular times of the year for religious slaughter and sacrifice.

Australia is by no means the only supplier of live sheep to the region. Other traditional sources---involving different and often higher priced (fat-tailed) breeds include Rumania, Bulgaria, Somalia, Sudan, Turkey and even South America. Competition also comes from carcase meat---mutton and lamb, chilled and frozen---as well as poultry and beef. The total market is---and was a decade ago---highly competitive. Each product has its place and prices are sensitive to changing conditions. The main group responsible for opening up the market for Australian live sheep was the Danish Clausen shipping group. It converted surplus oil tankers into specialist sheep carriers---enormous vessels, some of which are capable of carrying over 100,000 sheep per voyage. Other groups entered the trade later, especially following the OPEC oil price hike. The requirements and husbandry skills for feeding, watering, ventilation and the hygiene of these large numbers of animals are clearly not to be underestimated.

Initial Skirmishes

In the early and mid 1970s, the Australian sheep and wool industry was undergoing its most turbulent period ever. In 1970, when sheep numbers peaked at 180m, some sages were suggesting that the sheep was about to go the way of the silkworm---a permanent victim of the march of synthetic fibres. As a result of the wool recession, sheep numbers declined by 40m by 1974. They recovered to just over 150m the next year---there had been a brief, if spectacular, commodity boom in 1973-74---before dropping further to 135m in 1978. Variable seasonal conditions added another uncertain element. As a result, sheep slaughterings fluctuated widely and hence the demand for abattoir employees also fluctuated.

With the live sheep export industry expanding at the time, it was perhaps not surprising that the abattoir workers' union, the Australasian Meat Industry Employees' Union (AMIEU), saw the sheep exports as the 'cause' of this fluctuating abattoir employment, even if other factors were actually responsible.

The AMIEU first became concerned in about 1973 when it had the temerity to impose a 'ban' on all live sheep exports. The then Federal Minister, Senator Wriedt, responded in the way that politicians find most natural---by setting up a committee. It was headed by the Chairman of the Australian Meat Board, Col. McArthur, and the outcome was a weight restriction on the type of sheep which could be exported live.

The weight limit was dropped in the following year and the AMIEU then sought industry and individual company agreement to the proposition that for every sheep exported live, two or three should be exported in carcase form (the ratio sought varied over time and between different States). This became known as the '2 for l' or '3 for l' ratio. Some live sheep exporters ignored these demands while others endeavoured to abide by them, mainly because they did not exert any great impact. However, as numbers of live sheep exported continued to rise, these ratios 'bit' and began to influence market behaviour.

The AMIEU focused its attention on live sheep exporters who were also meat processors and exporters---that is, the employers of its members. Producers and their organisations are not closely involved at this stage.

Indeed, some meat exporters shared the union's concern at the impact of live sheep exports on abattoir throughput and employment. The exporters' organisation---the Australian Meat Exporters' Federal Council---managed to convince Col. McArthur that some restraints were required. Fortunately the Meat Board had no power over livestock exports and so was able to come to the 'help' of the industry! By the time the Australian Meat and Livestock Corporation replaced the Meat Board (in July 1977), producers were sufficiently active to prevent the new Corporation---with expanded powers that did include livestock exports---taking any ill-advised action.

From the start, my organisation, the Australian Woolgrowers' and Graziers' Council (AWGC), was totally opposed to any restrictions being imposed on livestock exports. The following AWGC policy resolution on the issue is indicative:

    'That this Council does not accept any interference in the free export of live sheep for slaughter. Further, that it does not recognise any so-called agreements or arrangements made between labour organisations and/or other interested parties which may have the effect of interfering with this freedom.'

This view was conveyed to the Primary Industry Minister, Ian Sinclair, by an AWGC delegation in February 1976---that is, shortly after the election of the Fraser Government.

Unfortunately, the policy position of the other Federal organisation at the time--- the Australian Wool and Meat Producers' Federation (AWMPF)---was more equivocal. One of its leaders, John Kerin (no relation to the present Minister), President of the AWMPF affiliate the United Farmers' and Graziers' of South Australia, occasionally acting President of AWMPF, and AMB producer Board member, actually moved a resolution at a State tripartite meeting in South Australia in June 1977 supporting a 2 for 1 ratio. Others attending that meeting were Departmental officers, meat exporters, live sheep exporters, union representatives and other producers (two each representing the South Australian affiliates of AWGC and AWMPF). The resolution was passed 11 to 4, with 4 abstentions. The next day, the AWGC representatives telexed Mr Sinclair and others, stating their total opposition to the resolution and that under no circumstances would they be bound by it.

The tempo escalated in 1977. The AMIEU's Federal Management Committee took over the handling of the issue and, shortly thereafter, it announced that live sheep exports from Queensland, New South Wales and Tasmania were 'banned' and that stock movements from Southern Queensland and New South Wales into South Australia for export would be blocked.

It stated that the 'current ratios' in Western Australia were working well but that it was 'worried' by the situation in South Australia.

The union announced that it was giving the entire industry until 1 March the following year to implement an effective system of ratios, failing which national industrial action would be taken. It sought from every exporter, details of sheep and sheepmeat exports to all markets.

Senior office-bearers of the AMIEU must have fancied the chances of their policies being adopted, the rhetoric of opposition notwithstanding. Some live sheep exporters were supporting ratios (especially the relative newcomers such as AustIran/Meridian Livestock) some meat exporters were uneasy at what was occurring, Col. McArthur was known to be sympathetic, not all producer groups appeared resolute and even the Federal Government had not developed an industrial reputation which would have caused AMIEU officials to lose much sleep.

However, the Government had recently passed amendments to the Trade Practices Act following a review by the Swanston Committee. The amendments included the secondary boycott provisions at Section 45D. In late 1977, these provisions had not been widely tested and there was very little, if any, case law to go on.

The AMIEU threats were being taken sufficiently seriously that in September 1977 Elder Smith Goldsborough Mort (Elders GM)---now Elders Pastoral---obtained a preliminary opinion by senior counsel to assess the options which might be open to deal with any attempted blockage of the movement of live sheep to a vessel. It appeared fairly clear that S45D was designed with such an eventuality in mind.

Another initiative at this time was the formation in South Australia of a Livestock Exporter Industry Association. Its sponsor was Ian McLachlan, via AWGC's affiliate, the Stockowners' Association of South Australia, and it was designed to ensure a more robust and united view on the livestock export issue by all producer groups and livestock exporters (some of whom were also major meat exporters). AWGC also became more active in a co-ordinating role at this time.

By the second half of 1977 headlines in the rural press were forecasting a major industrial 'blow-up'. Because of a shortage of sheep for slaughter---largely the result of seasonal conditions---abattoir employment was falling, the AMIEU and its members were becoming more restive, and live sheep exports---the convenient scapegoat---were continuing to rise. The union made the fanciful claim that 16,000 abattoir jobs had been lost over the previous twelve months, by implication most due to live sheep exports.

The issue was the main item of business at a meeting on 2 August 1977 of the ACTU-Farm Organisations Liaison Committee. Credit for the formation of this Committee was claimed by the then President of the ACTU, Mr Hawke.1 It met infrequently and was a forum largely for farmers to ventilate concerns with the actions of unions. Not surprisingly, it achieved little and later fell into disuse.

This particular meeting did at least acquaint Mr Hawke with the knowledge that farmers felt very strongly on the live sheep export issue.2 Debate was led by Ian McLachlan, who was a Vice-President of AWGC and who had a keen interest in, and had quickly developed a grasp of, industrial affairs.3 Later in 1977, Burston and McLachlan met Hawke and presented him with a paper outlining the farmer position and the reasons for it. Hawke and his ACTU colleagues were unable to fault the arguments contained in the paper.

A further formal meeting of the Liaison Committee took place on 13 March 1978 when the farm organisations flatly told the ACTU and AMIEU that no ratio would be acceptable under any circumstances. The AMIEU was again requested to provide substantive analysis of the impact of live sheep exports on abattoir employment, but it did not do so. Farmer representatives offered full co-operation in any approaches to the Government concerning demonstrated welfare problems in the industry or in seeking expansion of freezing and chilling and other facilities enabling development of carcase exports to the Middle East, without the use of bans and limitations. The AMIEU rejected this offer and the meeting broke down.

As for the AMIEU's policy, it was hard to visualise in practice how the mechanics of a ratio policy might operate, especially at the individual firm level. Producers endeavoured to explain to the AMIEU that any restraints would be detrimental, not only to their own, but also to meatworkers', long-term interests.

This argument turned on the substitutability of sheepmeat for live sheep. As noted earlier, consumer preference was clearly for fresh meat (hence live sheep); forcing the market to absorb more meat than it wanted would have been counter-productive---lower prices and reduced market share.4 Over and above these practical matters were the questions of principle: should Australia seek to dictate to its customers the form in which a product should be purchased? And, should not Australian producers have the unrestricted right to sell their product on world markets (especially at a time when most other rural commodity prices were at unremunerative levels)?

Other issues relevant to an overall perspective included:

  • abattoir awards already recognised the somewhat variable nature of employment in the industry by containing a loading to compensate for times when employees may be temporarily out of work;
  • the numbers of sheep which died each year on farm from 'normal causes' substantially exceeded the numbers being exported live; and
  • the union's record of industrial militancy did not suggest an abiding care for maximum employment; in 1977 industrial disputes in the meat industry cost 262,000 man days of work sufficient to provide full-time employment for 1,000 people.

Battle Lines are Drawn

None of this cut much ice with the AMIEU. The union's Assistant Federal Secretary, Mr Jack O'Toole, announced that, as industry meetings had broken down, it would henceforth deal directly with shippers and would consider the use of pickets to achieve its objectives.

Accordingly, on Sunday 19 March 1978, the AMIEU imposed a picket designed to prevent the movement of 30,000 sheep owned by Elders G, which were being held at sheep yards at 'The Levels', Cavan, on the outskirts of Adelaide. These sheep were to be loaded on a Clausen vessel ---the Iran Cremona---for export to the Middle East. Similar pickets were imposed in Western Australia (see later).

On the same day, the two grower organisations---the United Farmers and Graziers of SA and the Stockowners' Association of SA---met and formed a Combined Livestock Committee, under the chairmanship of Ian McLachlan. The Committee was given total responsibility to handle the dispute. In reiterating its unequivocal opposition to any ratios, the Committee pledged itself to take lawful action only and to seek action by the SA Government to remove the picket forthwith so that the sheep could be loaded. The Committee also decided that:

  • if livestock shipments from SA ports were impeded, it would arrange for the withholding of all stock for slaughter from SA abattoirs;
  • no livestock from interstate should be slaughtered in SA abattoirs in these circumstances; and
  • relevant State and Federal Ministers should seek injunctions against the AMIEU if they prevented the free flow of live sheep exports.

A number of actions took place over the next couple of days:

  • pickets were extended to cover an additional 70,000 or so sheep owned by Metro Meat awaiting loading on two vessels berthing in Adelaide; this was a great relief to the Combined Livestock Committee because it avoided the possibility of a split in the exporters' ranks;
  • the SA Minister for Labour and Industry, in a meeting with grower, shipper and union representatives, proposed a one month's moratorium during which all bans would be lifted, in return for exporters agreeing to a 2 for 1 ratio; not surprisingly, this 'initiative' was rejected;
  • discussions were held between AWGC and the Trade Practices Commission in Canberra to explore options for the TPC initiating action under S45D (as it was empowered to do);
  • various legal options which might be taken by the owners of the sheep (Elders GM) were assessed---involving, inter alia, S45D, the Crimes Act, the SA Road Traffic Act, the Trespassing on Land Act and common law; and
  • the President of AWGC, Sir Samuel Burston, approached the Prime Minister requesting the Government, through the Minister for Business and Consumer Affairs, to take out an injunction seeking to restrain continuing breaches of S45D by the AMIEU.

Role of S45D

It is appropriate to note the relevant words of S45D. At that time, it stated that:

    'S45D(1) ...a person shall not, in concert with another person, engage in conduct that hinders or presents the supply of goods or services by a third person to a corporation ... where the conduct is engaged in for the purpose, and would have or be likely to have the effect, of causing:

    (a) substantial loss or damage to the business of the corporation..., or

    (b) a substantial lessening of competition in any market in which the corporation supplies or acquires goods or services.'

The persons acting in concert were clearly the AMIEU, its office-bearers and/or members; the third person was Elders GM, which had a contract to supply goods (sheep) to a corporation (Clausen).

While S45D had only recently appeared on the statutes, the AMIEU was already familiar with it, being the defendant in the successful Tillman's butchery case in late 1977 (in fact a further hearing on that case was set down for 11 April).

It seemed clear that Elders GM could take action under S45D, the only uncertainty being whether the union might be able to argue that its conduct was not engaged in for the purpose of causing loss or damage (both purpose and effect having to be established). It also seemed possible that a grower might be able to succeed with action under S45D (1)(b) and that Clausen could have a common law action against the AMIEU for causing breach of contract.

Federal Cabinet considered the request for its intervention on Wednesday 22 March and replied that it was 'urgently considering the proposition'.

Elders GM first attempted to move the picketed sheep on Tuesday 21 March. The attempt was unsuccessful and affidavits were prepared describing what had occurred. This led Elders to launch proceedings in the Federal Court on Thursday 23 March (before Fisher J.) seeking an injunction under S45D. Interestingly, one of the Elders affidavits recorded a conversation with the SA State Secretary of the AMIEU, Mr Arthur Tonkin. In it, Mr Tonkin was quoted as saying:

    'I am acting on instructions from my Federal body. I am told what I am to do. The phone rings four times a day. I am under Federal instructions.'

So much for democracy. These observations were hardly a stinging endorsement of the AMIEU's actions from those in the front line.

The full hearing for the application of an interim injunction took place the following Wednesday (29 March). By this time the Commonwealth Government had decided to join the proceedings in support of Elders. The AMIEU was represented by its Federal Secretary (Mr Fred Hall) who rejected the claim, saying that the respondents were acting within union policy as they were bound to do. He added that the union was planning to challenge the constitutional validity of S45D before the High Court. The Elders application for an interim injunction was granted, with the date for the hearing concerning a permanent injunction being set for 26 April. The stakes were rising: continued picketing would place the union in contempt of court.

Pressure Increases

Meanwhile, the Combined Livestock Committee was itself stepping up the pressure. At a meeting on Thursday 23 March, it passed the following resolution:

    'That all primary producers in South Australia be advised that they should market no livestock for handling by any South Australian export abattoir as from and including Tuesday 28 March because, due to industrial interference, the market place does not represent the true value of their produce.'

This was a carefully worded resolution---that it could not itself be caught by S45D---but the intent was clear: if there were no livestock marketed, there would be no work for AMIEU members, who would therefore be liable for stand down. After some frank discussions with one or two sceptics, the resolution was successfully implemented.

By the middle of the second week it was apparent that the live sheep dispute was no minor tiff. Behind-the-scenes negotiations were commencing and Hawke, for example, was suggesting to the AMIEU that it might have bitten off more than it could chew.

More worryingly, Sir Samuel Burston, President of AWGC, was being pressured to back off by a number of senior Ministers, suggesting that a Cabinet decision to this effect had been taken. However, by this stage, farmers around the country were uniting behind the actions of the Combined Livestock Committee like never before. Therefore, even if he wanted to--- which of course, he didn't---Sir Samuel was in no position to accede to this pressure. However, the fact that it was being applied was a sad reflection on the instincts, priorities and resolve of the Government, especially given its electoral mandates from 1975 and 1977.

Pressure was also applied by members of the Industrial Relations Club---employer associations and the Arbitration Commission itself---to the effect that conciliation and arbitration was the only answer. Ted Cole, with his lengthy day-to-day experience of dealing with such people, was very firm in his advice that AWGC should keep the dispute well away from the Commission. He was being continually approached to 'get his people to be reasonable'.

On Friday 31 March, another grower initiative took place. A motorcade of about 100 cars and trucks drove slowly through the streets of Adelaide in an endeavour to draw further attention to the farmers' position. In a press statement, Ian McLachlan said that this was just the start'. In fact it was a trial run for a much larger invasion which was being planned for the following Tuesday.

The Federal Government was searching for a means of settling the dispute. The Minister for Employment and Industrial Relations---Mr Tony Street---and Mr Hawke held meetings on 31 March at which a proposal was developed for all bans to be lifted in return for an inquiry into the live sheep export industry. This proposal was put to Sir Samuel Burston who rejected it. Mr Street even wanted the AWGC Executive and the AMIEU Executive to consider the proposal simultaneously and to record their decisions in sealed envelopes---a rather Gilbertian touch. The AMIEU did not think much of this plan either, considering it too vague.

The recognition of the futility of inquiries as the basis for 'solutions' to these types of disputes was absolutely critical. Sir Samuel Burston came to this conclusion while walking around the hills of his Casterton property, and Jim Samson from Western Australia was also firmly of this view. The experience was later recalled during the Mudginberri dispute.

From the farmer perspective there was clearly nothing to be gained. The issue was one of principle on which no compromise was possible, farmer action to counter the pickets was so far quite effective, the media generally had become quite sympathetic and the AMIEU, on past performance, was not certain to abide by any umpire's verdict. At the Adelaide livestock markets that week, 84 sheep and 28 cattle were on offer, compared with normal yardings of 18,000 and 3,000 respectively. This was an unprecedented display of farmer unity and determination.

The SA Government had the power to act, principally by instructing the police to remove the pickets. It did not do so. Nor was McLachlan able to convince the Chief of Police that, if he was able to move the sheep onto the main road, the police had a responsibility to keep the highways and byways clear (under the SA Road Traffic Act).

However, as Mr Dunstan's comments, quoted at the beginning, indicate, the Government was trying to 'conciliate' and it was worried about 'reasonable people' versus 'extremists'. In fact the South Australian Government played a comparatively minor, and largely ineffective, role. This was perhaps fortunate---because one of the briefing papers prepared for the Agriculture Minister stated that:

    'No permanent solution can be generated until a formula is derived which provides an assurance to all parties. One can appreciate the view that 'we produce the stock and should be able to sell to whom we like'.

    Nevertheless, industrially, it must be prudent to negotiate on a formula which safeguards the interests of all parties.'

The then Chairman of SAMCOR---the government-owned authority which ran the Gepps Cross abattoir in Adelaide---held a similar view. He told McLachlan during the dispute: <

    'You must compromise; the name of the game these days is conciliation.'

Adelaide Rally

Tuesday 4 April was a momentous day and, if there were any lingering doubts about the farmers' resolve, they were completely swept aside. An enormous motorcade, of 4,000 cars and trucks, assembled at dawn at eight strategic locations around the city outskirts and proceeded, in groups of 25-30, to drive slowly towards the centre of the city at less than 20 kph. The traffic of Adelaide was brought to a virtual standstill. The police were forewarned and, far from being critical, co-operated to the hilt. Members of the general public stood and cheered and sought information leaflets which were available. Extra television and radio news bulletins were broadcast and the newspapers ran special supplements on the procession. One Adelaide resident wrote to Ian McLachlan in terms which seemed to sum up the prevailing mood:

    'Your demonstration managed to delay me today; I got to work a little late. However, I write not to complain but to congratulate you on your efforts. For too long we have had stupid industrial action which has really cost Australia dearly in so many ways.'

The farmers' cars and trucks were liberally festooned with posters which demonstrated that, despite the seriousness of the situation, bush humour was alive and well. It is a great pity they have not all been recorded. Here are a few examples:

    'Pick a peck of picketers and pack them in the poop.'

    'Load the sheep and let them float; send Don and pray he don't.'

    'De-tool O'Toole.'

    'Dear Don: get off you Arts and do something.'

    'Bar the bastards who bar our baas.'

    'Sheep go or Dunstan go; prefer both.'

By this time there was naturally widespread discussion as to whether direct farmer involvement might be needed to move and load the sheep. The thousands of farmers who descended on Adelaide that day were therefore doing more than just showing solidarity---they were potentially on standby. Farmers came not just from all parts of South Australia but from further afield as well. A charter plane load of 200 Queenslanders was present and there were far more volunteers for this trip than places available. The Queenslanders successfully generated extensive media coverage while in Adelaide demanding that the sheep be loaded---and managed well and truly to get up the nostrils of Mr Dunstan.

Significantly also, there were several carloads of (non-AMIEU) unionists present especially shearer members of the AWU. The State Secretary of the AWU issued a statement highly critical of the actions of the AMIEU---which had led to the standing down of some of his members (e.g. 80 shearers employed by Metro Meat to shear sheep just prior to export). The AWU could see the employment-creating effects of the trade for its members and at no time supported the position of the AMIEU.5

One of the more important but lesser known activities which occurred while the 'drive-slow' was in progress, was a series of no fewer than four telephone calls between Ian McLachlan, Sam Burston and the Prime Minister which led ultimately to an unequivocal statement of support from the Commonwealth Government. These discussions were at times quite testy as to whether the Government was or was not supporting the farmers and whether the farmers were or were not being reasonable. Initially, a metre-long telex arrived which was verbose and evasive. The Prime Minister was bluntly told that he would be held up to ridicule and the reader booed or laughed off the stage were it read out at the rally. Mr Fraser's final telex---which was largely drafted by McLachlan himself---read:

    'The Federal Government has already supported action taken under S45D of the Trade Practices Act in relation to the live sheep export trade, and in the face of bans remaining in force will continue to do so. The law is there for a purpose in this instance the free movement of trade and commerce into and out of Australia. This law will be upheld.'

This statement was read out to the lunch time rally at Victoria Square which was the culmination of the 'drive-slow'. It was attended by between 6,000 and 10,000 people---including many city residents. The Board of Elders interrupted its meeting and marched the few blocks to the rally behind Managing Director, Charles Schmidt. The rally served as a massive display of support for the actions taken. Later, Ian McLachlan responded to Mr Fraser in these terms:

    'My thanks for the firm telex which vas read to a meeting of many thousands of farmers and public in Adelaide today. Had I received any less positive a message from you, it would have been received by the gathering with suspicion and the orderly departure of farmers would have been doubtful.'

At the end of the day, a keg was despatched to Police Headquarters as a token of farmer appreciation for police co-operation and good humour. Media support for the farmers' cause was virtually unanimous. The Advertiser's editorial the day after the rally said, in part:

    'The farmers who rallied from far and wide to converge on Adelaide yesterday made their point in no uncertain terms. It was unfortunate, perhaps, that they chose so disruptive a means of doing so. They managed nevertheless to get across a message that would have struck a responsive chord not only in city dwellers here but in other people throughout Australia.

    The message transcended the immediate issue of the right of primary producers to find and exploit markets of their own choice. It was, in essence, that an intolerable situation has been reached if the law is not to be enforced and if elected governments are to behave in a manner subservient to union pressure. It has been left to the farmers who, in their own words, 'have had a gutful', to spell it out with such clarity.

    Despite the widespread traffic jams, yesterday's demonstration was no less impressive for the restraint shown by its leaders. The appeal was to reason rather than emotion: it was emphasised, in particular, that violence towards the pickets who have several times frustrated efforts to load the sheep for export should be avoided.'

Meanwhile, Elders had made further attempts to test the pickets. They remained in force; and so on Thursday 6 April (the day before Good Friday), Elders served contempt notices on union officials, returnable in the Federal Court the following Tuesday (11th).

The Assistant Secretary of the local TLC made constructive entry to the debate by calling for the live sheep export industry to be nationalised. His plea fell on deaf ears! More positively, Senator Peter Walsh, who was then the Opposition's spokesman on Agriculture, issued a paper strongly critical of the AMIEU and fully supportive of the unrestricted export of live sheep.

And so the dispute entered its fourth and decisive week. Before describing these events, the scene in Western Australia should be recorded.

Western Australian Connection

While Adelaide may have been the main focus of events during the four-week dispute, there was no shortage of activity in Western Australia. As already noted, Western Australia had a lengthier history of live sheep exports than any other State and this had already been reflected in a change in the sheep flock structure, with a higher proportion of ewes to wethers (the wether portion only being required for export).

The AMIEU action, when it commenced on 19 March, was intended to be nationwide. Accordingly, pickets were threatened the following day at both Bunbury and Albany. At Bunbury the waterside workers erected a barricade to keep the pickets out and stated that they would load the sheep. At Albany, the waterside workers were initially undecided but eventually agreed to load sheep when told that if they refused the ship would merely be moved to another port where the waterside workers were prepared to load.

The Bunbury ship was eventually loaded after the AMIEU picketers, who had got around the waterside barricade and on to the ship, were removed by police. The Albany ship---the Farid Fares, which was loading 41,000 sheep for Metro Meat remained picketed and so Metro Meat gave all its WA AMIEU employees one week's notice before being stood down, as required by the WA State Award. As in South Australia growers were advised to withhold livestock from sale, on the grounds that the industrial interference was preventing the true market value being reflected in the saleyard. Metro also sought a S45D interim injunction against the picketing at Albany and this was granted by Fisher J. sitting in chambers, in Adelaide. Pickets were also imposed on vessels loading at Esperance, Fremantle and Geraldton.

However, unlike South Australia, the WA Government, under Sir Charles Court, was more active. On 30 March the Government issued an Executive Council order giving port authorities power to call in police. It also instructed the WA Meat Commission---a statutory authority which operated the Robbs Jetty abattoir in Perth---to apply to the State Industrial Commission to seek the removal from the award of the AMlEU's right of entry at abattoirs and an employment preference clause for AMIEU members.

On 10 April growers decided that they would take over the loading of sheep. A number were made temporary port authority employees for this purpose (in some of the outer ports) and loading was carried out at Albany and Esperance with farmer assistance. The Waterside Workers' Federation responded to this use of 'scab' labour by calling a 24 hour national waterfront strike for 12 April. A total of 62 picketers were arrested by police for being on port authority land, which also provoked a (four day) national abattoir strike.

By this time, events had also moved ahead decisively in Adelaide.

Operation Sheeplift

Over the Easter weekend, the weather intervened for the first time as a cold change passed through Adelaide. This not only made the overcrowded sheep-holding yards extremely muddy and unpleasant, but also exposed the newly shorn sheep to wet and windy conditions from which some stock died and more were likely to follow. There were by now over 90,000 sheep blocked by pickets in Adelaide and feed was beginning to run short.

Ian McLachlan announced categorically that the sheep were going to be moved during the coming week. A plan which had been devised over the weekend, and which was given the title Operation Sheeplift, was put into effect. It consisted of a few engagingly simple ideas, some lateral thinking and meticulous planning.

Metro Meat's Managing Director, Ken Dingwall, announced that the vessel Aries Chief, not being able to load in Adelaide, was being diverted to Western Australia. In fact once clear of Outer Harbour, the Aries Chief sailed not for the west, but around to Spencer Gulf and to the small port of Wallaroo. Wallaroo was chosen because it was close to Adelaide, because there were no pickets present, and also importantly because the vessel could manoeuvre into and out of the berth without the necessity for tugs---and therefore free from potential blackbanning by tug operators. The idea of Wallaroo was first suggested a few weeks previously by Ernest Mills, a Tasmanian farmer, live sheep exporter and wartime friend of Sir Samuel Burston. Mills held the lease for all the wharf facilities at Wallaroo and offered them to the farmers should they be of interest. The idea was converted into a specific plan by Ian McLachlan.

Meanwhile, a small group of farmers---about 30---were sent to Wallaroo to guard the entrance to the port and prevent any AMlEU pickets from intervening. Several hundred later gathered there---a portion of those who had remained in Adelaide after the rally on 'roster'. As an extra precaution---indicative of the careful planning---all participating farmers were issued with coloured armbands for identification. The main organiser of this part of the operation was Stockowners' Association executive member, John Riggs, who had earlier supervised planning of the 'drive slow' through Adelaide.

The third element was the movement of the sheep from the holding yards. Again a simple solution was devised. Rather than take them directly past or through the pickets, they were loaded onto semi-trailers at the rear of the holding yards and taken out via the back door, so to speak. A convoy of semi-trailers then proceeded the 150 or so kilometres to the now protected port of Wallaroo. The Commissioner of Police had by now recognised his responsibilities under the Road Traffic Act and helped to ensure that the roads were clear.

The picket had been out-flanked---and outthought.

On Tuesday 11 April---after the berthing of the Aries Chief was delayed by adverse tides and strong winds---loading commenced at Wallaroo, with the aid of some of the farmers. On the previous day, as already noted, loading commenced in Western Australia, also involving direct farmer assistance.

With the picket effectively defeated, an agreement was reached between the Government (Mr Street), the ACTU and AWGC that involved:

  • the lifting of all bans and removal of all pickets;
  • the resumption of normal loading;
  • the temporary suspension of legal proceedings; and
  • an understanding that, for the immediate future, neither side would publicly press its position regarding ratios.

When they realised what was happening, some AMIEU picketers travelled by car to Wallaroo. However, they soon realised that discretion was the better part of valour and they did not seek to disrupt loading. The question of how close matters came to physical violence, even bloodshed, has been frequently discussed, especially by Mr Hawke and other union representatives. In fact it was one of the only 'beat-ups' of the entire dispute. Part of the reason for this was undoubtedly exaggerated or misinformation in the heat of the moment, but there was also an element of pique, not to mention aggrandisement, involved.

Here are three accounts:

    '700 farmers converged on the small town of Cavan [sic], most of them armed with some implement (including iron bars and hose pipes loaded with lead). Union officials compared the actions of these armed farmers with the mugs and hooligans who supported Adolf Hitler and fascism in Germany.'6

    'We had potentially the most violent industrial dispute in my recollection. If farmers and meat workers had physically confronted each other, particularly at Wallaroo, it is just as likely as not that deaths would have ensued. It is not overdramatic to suggest that we were not very far away from that.'7

    'The dispute had abruptly shifted towards flash-point. In South Australia a convoy of sheep trucks had already set out and was only a few hours away from arriving at the wharves; both the picketers and the farmers were carrying weapons. Hawke recalled,

    I got to Tony (Street's) office and he told me what the position was: we had only a couple of hours. The situation was appalling---the union blokes and the farmers were armed, and when the trucks arrived at the wharves that was going to be it. We got on the telephones and managed to get a message to Ian McLachlan, who was the leader of the farmers' group in South Australia. McLachlan is a very able bloke and one of the toughest I've ever had to deal with in negotiations. Finally, we were able to talk to him in a telephone box at Wallaroo. I had a very tough conversation with him---I pleaded then demanded that he had to call his people off because otherwise there would be bloodshed, maybe death, and if that happened then there was no way the thing could be unravelled, and at any rate, it was just too horrible to contemplate that people might be killing each other. He was very tough---his side undeniably had a case: the farmers were really scratching financially and were fighting for their livelihood---but to his credit he responded. He called his men off. That was just the first step.

    The next was to try to resolve the conflict. He, Street, I and [Sir] Sam Burston, who was magnificent in his co-operation, then had to work something out. We set up an inquiry.

    A senior government official, who requested anonymity, said later that Hawke's handling of the dispute had averted not just a brawl on a wharf in South Australia but the development of a widespread violent confrontation. Both sides had access to weapons---the farmers were carrying iron clubs and batons gnarled with barbed wire, and are rifle owners while the meat workers could lay their hands upon a murderous variety of skinning and boning knives. The live sheep dispute is generally regarded in industrial relations circles as the most potentially dangerous since the Depression. Sir Richard Kirby commented 'The only dispute that I remember being anything like as serious was the Rothbury Disaster of 1929. I think for the country as a whole, we had a very lucky escape in 1978.''8

Mr Hawke may well have believed these comments, but the reality was quite different. Certainly, individual farmers may have welcomed the opportunity for a 'stoush' and were not intending to retreat if challenged. But apart from the several factual errors in these accounts, the reality was that the farmers' leaders were totally in control at all times (the editorial in the Advertiser quoted earlier commented on the fact). The whole point of the Wallaroo operation was to avoid direct physical confrontation with the meatworkers, not provoke it---to out-think and out-flank the union pickets. If individual unionists were going to be silly enough to travel 150 kilometres in order to walk into the lion's den, then that would have been their look-out. In the end, they had enough commonsense not to do so. There was no suggestion of 'McLachlan calling his men off' at Wallaroo; they were there first for precisely the reason to prevent a confrontation.

As for farmers' weapons, virtually the most 'dangerous' pieces of equipment on hand were lengths of PVC pipe which farmers regularly use as prodders when handling stock in their yards. How on earth any union official could have seen they were filled with lead is intriguing. Ms d'Alpuget's anonymous Government official---who could see it all from Canberra---was clearly finding the atmosphere too heady. Ms d'Alpuget's own amplification (rifles and knives) makes her seem somewhat gullible, while the observations of Sir Richard Kirby---of all people---are in the best arbitral traditions of Henry Bournes Higgins.

In fact, Mr Hawke's role in the dispute was far more limited than he and some other people have since made out. He was in the unusual position of facing people who were tough, determined and correct and he had little choice in the end but to try to assist the AMIEU save some face, a task made more difficult by the fact (as he himself has admitted) that he was not widely admired by some senior AMIEU office-bearers.

Hawke had already capitulated by the time he spoke to McLachlan at Wallaroo, having earlier spoken to Burston and offered to call off all union action in return for discussions. Burston responded that he would not even convey this proposal to the South Australians unless the assurances that all bans would be lifted, all pickets removed and normal loading resumed, were ironclad. Hawke gave this undertaking, whereupon Burston rang McLachlan---that is, well before Hawke did so. At this stage, there was no negotiation---let alone pleading---with McLachlan at all.

Subsequent Events

On 19 April, a week after the dispute ended, Mr Street chaired a meeting of interested parties to attempt to pick up the pieces. This meeting agreed that:

  • there should be an examination of the employment implications of the live sheep export trade, conducted over the following three weeks by Mr Geoff Miller, then Director of the Bureau of Agricultural Economics;
  • to encourage a further expansion in the carcase meat trade to the Middle East, and despite a recent examination conducted by Government officials, a 'tripartite fact-finding mission' would be sent to the Middle East; and
  • pending these examinations, the status quo should remain---that is, no bans, no change in the volume of livestock exports, and no action on the S45D matters.

AWGC made a 44 page submission to the Miller Inquiry on 24 April. It contained detailed assessments of the additional jobs created by the live sheep export trade (roughly 1,600 throughout Australia) and demonstrated that, at maximum, 200-300 abattoir jobs may have been displaced but, more likely, no jobs at all would have been lost.9

The Miller Report was eventually completed in August (partly because the AMIEU's submission, although required by 1 May, was not received until 23 May), coinciding with the report of the findings of the Middle East mission. Both reports were considered at a further tripartite meeting chaired by Mr Street on 19 August, a meeting which AMIEU representatives declined to attend, although earlier demanding that it be deferred from 9 August.

The Miller Report came down unequivocally in favour of the continued unrestricted export of live sheep. The AMIEU rejected the Report, and so AWGC arranged to have 30,000 copies printed of its findings, and also those of the Middle East mission, which were distributed to meat workers throughout the country.

In subsequent years, there have been periodic flare-ups of the live sheep dispute, especially at Portland which later became a shipment port. The Victorian Secretary of the union, Mr Wally Curran, maintained his enthusiasm for ratios and the odd dispute (an industrially plagued abattoir located at Portland was a contributing factor). However, on each occasion, farmers indicated that they, too, had lost none of their enthusiasm to maintain the unrestricted trade and these various flare-ups were effectively dealt with.10

Some Implications

First and foremost, the live sheep export dispute demonstrated graphically that, on a matter of fundamental principle, farmers and their organisations were not prepared to compromise. Moreover, they demonstrated that they were capable of counter-attacking in an effective and innovative manner so as to avoid any direct and physical confrontation.

This determination was so novel in Australian industrial relations behaviour that it earned farmers the title of extremists by some politicians, while others---and their advisers---who, of course, were wiser in such matters, knew that sooner or later, 'an industrially realistic position, acceptable to all sides would be thrashed out by negotiation and consultation'.

The performance of the Federal Government, especially the initial attempts to 'talk reason' to the farmer leaders, has already been noted. Bert Kelly was typically astute in his assessment:

    'Many of the farmers felt that there was too much tame acceptance by the Government and that the best thing for them to do was to keep their heads down. Sometimes indeed the Government seemed to be almost irritated with the farmers because they were determined to go ahead with the struggle, even without Government support.

    If this is indeed so, it shows that the Government is losing contact with the rural sector. But, far more important, it shows a willingness on the part of the Government to compromise on matters in which there is no room for compromise.'11

Conversely, there was no mistaking the views of the general public---farmers and non-farmers alike. The media treatment also was massive and, almost without exception, sympathetic. During and after the dispute, hundreds of letters, telegrams and phone calls poured in to Ian McLachlan's office and to the rural organisations. Here is a small sample of them:

    'I am a wheat, sheep and cattle farmer in the Riverina and l want to personally thank you and your colleagues for the part you took on behalf of all Australians, indeed of all Australia, in defeating an illegal union picket. I am thrilled to hear of your brilliant victory.'

    'I wanted to let you know what a marvellous job you and all your supporters have done over the last few difficult weeks. The main thing was that you consistently argued for the maintenance of law and order---without that we are in trouble.'

    'I saw and heard Dunstan on TV last night and was astonished and disgusted. I've written him a note and told him so. Also that you were not the extremist, but the pickets blocking the free use of a public road. I believe there is no such thing as compromise with the type of people these unions represent. Being 91, I'm not much good at putting a letter together.'

    'As primary producers in the fishing industry, we fully support your stand in the live sheep dispute and we wish you every success in obtaining free export rights for your sheep.'

One of the important ingredients in the success achieved was the availability of S45D. For the first time this provided a lever to the employer side of a dispute which could be invoked and so restore some balance against unjustified trade union activities. Unlike the arbitral proceedings it was a 'real' law and it was heard in a real court---the Federal Court. Injunctive relief could be obtained promptly and a union which continued in defiance of a Court order was in contempt, for which the penalties could become very steep very quickly. On several occasions the Arbitration Commission ---via its President sought to become involved. This 'help' was consistently and effectively resisted by the farmers.

The S45D action did not proceed to its logical conclusion. Some said it was better that way---to keep the provisions untested, using them merely as negotiating coin. However, inevitably that bluff would be called and a preparedness to see matters through was obviously called for sooner or later. Subsequent cases have made further progress and any doubts about the efficacy of the legislation were removed.

In a related way the dispute also put paid to the view---which during the dispute continued to be espoused by at least one senior Government Minister---that legislation never solved industrial disputes. For a Minister, whose Government introduced the legislation, to make such a claim seems ironical to put it mildly. This particular legislation did materially help to resolve the dispute, as it has done repeatedly since.

A flaw in the wording of S45D was discovered and this was drawn to the Government's attention. As a result, a new clause S45D(l)(A) was inserted to remove any ambiguity or difficulty. As a sidelight it is appropriate to recall the observations of that well-known legal commentator, George Negus. Writing in the Weekend Australian, immediately following the dispute, he said:

    'S45D is a curious piece of law, shrouded in vagueness and constitutionally dubious. Weighty legal opinion is that this highly doubtful law might not stand any real High Court test.'

Ten years on, it is still in place and George's weighty lawyers have not been able to convince the High Court to strike it down. Incidentally, the AMIEU's threatened High Court challenge never proceeded.

For the victors the dispute was, apart from anything else, a massive morale booster. It greatly smoothed the path to NFF---and obviously the United Farmers and Stockowners of SA, which, within 18 months, merged the United Farmers and Graziers and the Stockowners Association. It also gave farmers a renewed sense of self-esteem in the community, which they have substantially built on since. And it encouraged them---and subsequently others---to continue to act resolutely in the major industrial battles which arose later.

Ian McLachlan's role was, of course, enormous. The pressure and the hours over that four-week period were unrelenting. In such an environment, there is so much happening, so many well-meaning opinions being offered, so many media demands, and so much paper flying about, that it is extraordinarily difficult to remain cool, level-headed and to be able to keep thinking, rather than just reacting. It is a gift given to only a few people.

As for the vanquished, AMIEU members suffered financially for the poor advice and leadership they received from their office-bearers. They certainly won nothing for their efforts. The experience proved too much for some and, within a short time, the Federal, South Australian and Western Australian Secretaries had either retired or resigned. Mr O'Toole battled on, becoming Federal Secretary, in which capacity he was to meet his destiny some years later, also involving Ian McLachlan, at a place called Mudginberri.


    1 Mr Hawke later claimed that this group brought the then disparate farm organisations together for the first time, which in turn facilitated amalgamation discussions leading to the formation of NFF. In other words, Mr Hawke claimed some credit for the formation of NFF. As they say, success has a thousand fathers! In fact the separate farm organisations had met jointly on numerous occasions previously. The prior President of AWGC, Peter Roberts, had been particularly instrumental in arranging these meetings, especially to ensure that a common approach was being put before the Government on such matters as pre-budget submissions

    2 Sir Samuel Burston and Mr Hawke were, at the time, fellow board members of the Reserve Bank. In their frequent discussions at that forum Sir Samuel was unable to reinforce farmer determination on the subject of live sheep exports.

    3 The cricket-loving Bob Hawke had been sufficiently impressed to have asked AWGC's Industrial Director Ted Cole on an earlier occasion whether this was the same Ian McLachlan who had played cricket for South Australia.

    4 Some months previously, a BAE paper had quantified these effects: a decline in live sheep exports by 56 per cent and prices by 45 per cent. See L D Cornell and P G Horne, 'Impact of the Middle East Market on the Supply Response of Live Sheep and Sheepmeat in the Australian Sheep Industry', paper presented to the 22nd Annual Conference of the Australian Agricultural Economics Society, Sydney, February 1978.

    5 En route to the rally, Sir Samuel Burston hitched a ride in an old truck. The three tough looking customers in its cab said: 'Are you a bushie? OK, hop in.' They said: 'We're not farmers, we're shearers but we're so mad with the ... meaties that we've driven 150 miles this morning to join in with you lot to show them what we think of them doing us out of our shearing contracts for the live sheep trade. You blokes make sure you flatten them...'

    6 AMIEU Queensland Branch, Newsletter, May 1978.

    7 Bob Hawke, quoted in the National Farmer, 20 April 1978.

    8 Blanch d'Alpuget, Robert J Hawke---A Biography, Schwartz 1982. pp 347-8

    9 This estimate needs to be set against the figure of an equivalent 1,100 abattoir jobs lost in 1977 as a result of AMIEU industrial disputes, which was quoted earlier.

    10 On one occasion farmers engaged trucks to break AMIEU picket lines and subsequently ensured that union attempts to black ban the drivers involved were unsuccessful. This in turn led to the celebrated Gibbins case, so eloquently described by Barrie Purvis in the IPA Review, See 'Arbitration and Human Rights', IPA Review, February 1987, pp 18-19.

    11 Hon C R Kelly (Modest Member), Australian Financial Review, 12 May 1978.