Tuesday, 6 September 1983 Mr SPEAKER (Hon. Harry Jenkins) took the chair at 2 p.m., and read prayers. Mr SINCLAIR(New England) —Mr Speaker, I rise on a matter of privilege. I refer to an article on page 5 of this morning's edition of the Sydney Daily Telegraph which is headed 'Speaker Probes Spy in MP Drama'; it is under the by-line of a Mr Bob Chisholm. During the course of that article there is a reference to this fact: A spokesman for the Speaker, Dr Harry Jenkins-- Mr Speaker, you are quoted by name-- confirmed yesterday that an MP had asked for an investigation into the incident to find out whether it had breached parliamentary privilege. Mr Speaker, you would also be aware that, on 29 August last, the Attorney- General, Senator Gareth Evans, in a letter to the Prime Minister (Mr Hawke) commented about the draconian terms of section 44 (ii) of the Constitution. He said: This gives further weight to the argument that the traditional political sanctions are the appropriate ones for all but the most extraordinary and dangerous ministerial breaches of official secrecy. He then said that in the public interest, in the prosecution of a member of this House in matters affecting national security it would not be appropriate for criminal proceedings to proceed. In the light of this article in the Daily Telegraph I ask: Firstly, will Mr Speaker advise the House of the nature of his investigations, to what degree he has reached conclusions on the submission by the honourable member and whether the matter is to be raised in the normal way in this House? Secondly, with respect to the opinion of the Attorney-General, will he assure the House that no greater privilege will be accorded members of this House than that which should and does apply to the citizens of Australia in matters pertaining to national security other than that privilege which is, of course, as of right, for matters and statements made within the House on matters where specific privilege is accorded by resolution of this place so that there will be no inhibition against any security agencies of this nation inquiring into any individual member in the same way as they would inquire into any citizen other than that which is covered specifically by parliamentary privilege ? Mr SPEAKER —I acknowledge that the right honourable member has quite properly raised a matter of privilege and he has done it at his earliest opportunity. He will appreciate that my attention has been drawn to the newspaper article. Unfortunately, there are inaccuracies. I think the interests of the House would be best served if, in reply to his submission, I made a considered statement later in the day. I thank the right honourable gentleman. Ministerial Statement Mr HAWKE(Wills-Prime Minister) —by leave-I wish to make a statement on the tragic episode which shocked the world last week. On the basis of information available to it, the Government has no doubt that Korean Air Lines flight 7, en route from Anchorage to Seoul, was shot down by a Soviet fighter aircraft early in the morning of 1 September Australian eastern standard time. Mr Speaker, there are many unanswered questions surrounding this disaster. The basic ones are: How was it possible for military aircraft to fire on and destroy a civilian airliner in peace time; and, why has the Soviet Union been unable or unwilling to produce a coherent, convincing and suitably regretful account of these appalling circumstances? Whatever the answer to these questions and to the other important question of how the airliner strayed so far off course into Soviet airspace, the simple fact is that an unarmed, civilian airliner serving no military purpose was shot down by a Soviet fighter aircraft. There can be no justification for such a barbaric act. Two hundred and sixty-nine passengers and crew, including four Australians, have died. Following this tragedy, the Government has taken action to bring to the attention of the Soviet Government its deep concern and shock and has sought a prompt and full explanation of Soviet actions. The Soviet Ambassador in Australia was called to the Department of Foreign Affairs on 2 September and requested to provide a full and proper account of the circumstances surrounding this unjustifiable act. On the same day, our Ambassador in Moscow, Mr Evans, called on the Soviet Foreign Ministry and made the same request. So far, the Soviet authorities have provided no information in response to our request. They have simply drawn our attention to statements made by the official Soviet newsagency, Tass. Apart from the fact that the statements so far issued by Tass have been totally inadequate and deliberately misleading-they have, for example, made the preposterous claim that the Korean airliner was on an intelligence mission-they are quite inappropriate as communications between governments. The Minister for Foreign Affairs (Mr Hayden) and I have made crystal clear the Government's outrage and condemnation at what has occurred. We will maintain persistent and strong pressure for an adequate explanation. I have personally expressed our condolences to the bereaved Australian families. May I say that I did not purport to speak just for the Government. I knew that I would be speaking for all members of this House. I have also sent a message of sympathy to President Chun Doo Hwan of the Republic of Korea, who will be paying an official visit to Australia next month. President Chun has addressed to me his country's appreciation of our support and sympathy. Australia was at the forefront of those countries which called for an emergency meeting of the United Nations Security Council to discuss this tragedy. This took place on Friday, 2 September and will resume on 6 September, United States time. The Australian acting permanent representative, Mr Joseph, expressed Australia's shock and indignation at the downing of the KAL flight. Describing the incident as a 'massacre in the sky', Mr Joseph said: Australia joins with other members of the international community in demanding an immediate and full accounting from the Soviet authorities. We have put this request bilaterally and I repeat it here today in a multilateral context. The explanations so far emanating from Moscow about the episode are in our view entirely inadequate. There has been a refusal thus far either to acknowledge responsibility or even to extend a convincing expression of regret for the action. This is deplorable. We appeal to the Soviet Union. If the Soviet authorities give in to the instinct to cover up, it will only confirm the worst fears of those who suspect them most, with repercussions across the spectrum of international relations. Mr Joseph went on: In this regard, Mr President, I must say that one cannot but feel profoundly disturbed by the latest Tass statement which was read out to the Council earlier this afternoon by the delegation of the USSR. We see no element of contrition in the statement. It amounts, at least on first reading, to blaming the victims themselves. I would remind the Soviet delegation that some of those victims were Australian citizens and I would say firmly on the behalf of these victims, now deceased, that they were entirely blameless in this appalling episode. We reject this latest attempted evasion of responsibility. I believe that this House would fully support the stance taken by this Government before the United Nations. This incident is one of the gravest concern to every nation. It is incompatible with accepted norms of civilised behaviour between nations and contrary to principles of international law. Moreover, it has very serious consequences for the safety of air navigation. Sadly, this incident is not the first of its kind. Honourable members will recall that in 1978 Soviet fighters opened fire on, and forced to land, another KAL flight, also with some loss of life. Earlier, in 1973, a Libyan aircraft strayed unwittingly over the Sinai Desert and was shot down by Israeli fighters with a loss of over 100 passengers and crew. That action was taken only after the pilot acknowledged, but did not heed, the warnings and signals given by the fighters. Furthermore, the Israeli Government promptly provided details of the incident, issued a statement expressing deep sorrow at the loss of life and announced ex gratia payments of compensation to the families of those killed in explicit deference to humanitarian considerations. Mr Speaker, there is a grim irony in the fact that the Soviet representative to an emergency session of the International Civil Aviation Organisation in February 1973 described that incident as a 'criminal act of international terrorism' and said that ICAO could not remain aloof from the barbaric act committed by Israel. In 1955, compensation was also offered by the Bulgarian Government after its air force had shot down an Israeli airliner in Bulgarian airspace, killing 64 passengers and crew. The Bulgarians offered to pay compensation to the families of those killed, to punish those responsible for the catastrophe and to take measures to prevent a repetition of such incidents. There are, therefore, precedents for the kind of response which the international community has every right now to expect of the Soviet Union. There is another dimension to this tragedy, to which I would like to draw the attention of the House. The incident is a reminder of the consequences of continued hostility and lack of communication and dialogue in the Korean peninsula. Australia has recognised two states and two governments on the Korean peninsula since 1974. Other Western nations which have relations with the Republic of Korea, South Korea, have made it clear that they would be prepared to recognise the Democratic People's Republic of Korea, North Korea, if the DPRK and its friends, including the Soviet Union, would come to terms with the reality that there has existed in South Korea for over 30 years a sovereign government, the Republic of Korea. It is our firm conviction that the continuing failure of the Soviet Union and others to recognise that reality, while attempting to deny the Republic of Korea its legitimate place in the international community and its rights in international law, has contributed to the circumstances in which this appalling action has taken place. Cabinet discussed this matter yesterday and examined possible future action which Australia, together with other nations principally affected, might take. The Government, in its deliberations, was mindful of the calm and deeply moving words of Mr Ray Grenfell, the brother of one of the Australian victims who, after expressing his shock and disbelief at the destruction of an unarmed passenger aircraft, said: 'But we don't believe there should be any further violence or retribution-one act like that does not deserve another act'. We have decided to continue to press the Soviet authorities for a full accounting of their actions. We are examining what steps might be taken to strengthen the safety of international civil aviation. We are supporting the convening of an extraordinary meeting of the Council of the International Civil Aviation Organisation in Montreal next week. There we will seek a full accounting by the Soviet Union and a thorough impartial investigation in accordance with the Chicago Convention. The shooting down of the Korean aircraft was a clear infringement of customary international law and of the principles underlying the 1944 Chicago Convention on International Civil Aviation, to which the USSR is a party. It is open to the Government, under international law, to claim compensation from the USSR for the loss of Australian lives. We are giving close consideration to this possibility. Obviously any amount of compensation will not recompense the grief of those families who have lost loved ones in this disaster. The Government regards this tragedy as an affront to the international community. As a result, Australia will seek to co-ordinate its response as widely as possible with other countries and particularly with the countries of the Asia-Pacific region. In this connection, I spoke with United States Secretary of State, George Schultz, yesterday and have confirmed that our attitude to this disaster is closely consistent with that of the United States. President Reagan's strong, clear and measured statement this morning expresses the profound concern and abhorrence felt by all civilised countries at what has occurred, while keeping open the channels of communication essential to preserve international security. The Soviet Union is now seeking to evade its responsibilities, to shift the blame and to categorise the justified international outrage at its action, as confected indignation for propaganda purposes. The Government reiterates that the Soviet Government must provide a full and adequate account of this tragedy. I am sure that the House will join me in calling on the USSR to cease hiding behind evasive statements and to accept its responsibilities before the international community for the tragic consequences of its action. In conclusion , I seek leave to move a motion. Leave granted. Mr HAWKE —I move: That this House- (1) expresses Australia's shock and indignation at the totally unjustified destruction of a Korean Airlines Boeing 747 by Soviet fighter aircraft; (2) Extends its deepest sympathy to the families of the Australian and other victims; (3) calls upon the USSR to give a full, truthful, prompt and appropriately regretful account of this tragic episode; (4) urges the international community to take measures to prevent the recurrence of such a tragedy; and (5) supports the response of the Australian Government as outlined in the Prime Minister's statement. Mr PEACOCK(Kooyong-Leader of the Opposition)(2.19) —Whilst joining the Government on this matter, the Opposition wishes to move an amendment to the motion moved by the Prime Minister (Mr Hawke). Mr Duffy —Oh, come on! Mr PEACOCK —When the honourable member hears me on this I do not think he will respond in that way. Accordingly, I move: That all the words after 'tragedy' be omitted with a view to substituting the following: '(5) while supporting the response of the Australian Government to date, as outlined in the Prime Minister's statement, requests the Government to formulate further measures that could be taken in the event of the Soviet Union failing to respond to the request in paragraph (3) and to press immediately for just compensation for the families affected by this disaster; and (6) condemns the Soviet Union for its barbaric act.'. In moving these amendments the Opposition has absolutely no intention of dividing this House. The gravity of the matter demands, in our view, that the House adopt a unanimous response. We hope, however, that the Government will feel able to accept our amendments in recognition of the abhorrent behaviour of the Soviet Union. Should this not be the case we will regret such rejection but, as I have stated, we will not divide on this issue. The Opposition joins the Government in condemning the Soviet Union for the shooting down of a Korean Air Lines aircraft and the tragic loss of life caused by what can only be described in the terms in which the Prime Minister referred to it and also as a callous act. The barbaric and savage action was both inhumane and illegal. It was a senseless and impulsive act of murder which will cast a dark shadow over the Soviet Union and its credibility in the international community. It has shown the Soviet Union to be governed by leaders who place little value on human life. That may already have been revealed by their behaviour in Hungary, Czechoslovakia and Afghanistan. It may already have been revealed in their treatment of political dissidents. But there could be no clearer example of the Soviet Union's callous disregard for human life than the shooting down of an unarmed civilian aircraft with 269 people on board. This incident tested the value the Soviet Government places on human life. It is acknowledged that the South Korean aircraft strayed into Soviet territory . It must be understood that that territory is of great military sensitivity to the Soviet Union. But instead of guiding the aircraft back on to its course the Soviet authorities shamelessly murdered 269 innocent men, women and children amongst whom were five Australians. It is cause not only for reflection but also for grave concern that a super-power with the potential to destroy mankind can overreact to a minor infringement of its air space with total indifference to humanity. Moreover, by defying international law the Soviet action has very serious consequences for the safety of air navigation. It was a breach of the 1944 Chicago Convention on International Civil Aviation. As the Prime Minister has rightly pointed out, it was contrary to the 1966 and 1973 International Civil Aviation Organisation resolutions calling on states not to intercept except as a last resort-and 'intercept' does not mean shoot down. It was also an act of legal hypocrisy. The Soviet Union was quick to charge France with illegality when in 1961 the French Air Force intercepted a Soviet civil aircraft flying without authorisation through French air space by firing a warning shot at it. On that occasion the Soviet Union asked: 'Since when has it become a custom to identify an aircraft by opening fire?' The Soviet Government must ask itself the same question today. The actions of the Soviet Union cannot be allowed to pass without censure. No nation, however powerful, can flout the accepted international principles of civilised behaviour with impunity. Indeed, a major power such as the Soviet Union has an even greater responsibility to uphold those principles in order to guarantee a more peaceful world. For this reason the Opposition supports the measures which the Prime Minister has outlined to this House today. We believe the Government should formulate further measures that could be taken against the Soviet Union if the Soviet Government fails to provide a full, truthful, prompt and regretful account of its behaviour. I mention in this context the possibility of acting to restrict access of Soviet crewed ships to Australian waters and the possibility of suspending bilateral trade talks with the Soviet Union. But the Government should also press immediately for full and just compensation for the relatives of those killed in the disaster, as the United States Administration is doing. The fact that the Soviet Union acted illegally demands, under international law, the payment of compensation. In line with the Government's motion the Opposition urges ICAO or other appropriate institutions to take measures to prevent the reoccurrence of such a tragedy. Measures should also be taken within ICAO to bring the Soviet Union to account for its disregard for international air law. We join the Government in stressing the vital importance of Australia acting in concert with other Western nations and our regional neighbours in taking measures against the USSR if those measures are to be fully effective. The Opposition has noted with approval the decisions announced today by the President of the United States and welcomes the Government's commitment to act in consultation with the United States. In conclusion let me repeat that the Opposition and, indeed, all Australians must be saddened and horrified at the atrocity committed by the Soviet Union. It was uncompassionate, inhumane slaughter. It was a grossly irresponsible act committed in defiance of international law. It was an act which showed the Soviet Government to be totally indifferent not only to the dignity of mankind but also to the point of taking lives. Finally, let me on behalf of the Opposition express our deepest sympathy to the relatives of the Grenfell family and Ms Jan Moline, the Australians who were so tragically murdered. Mr SPEAKER —Is the amendment seconded? Mr MacKellar —I second the amendment and reserve my right to speak. Mr HAYDEN(Oxley-Minister for Foreign Affairs)(2.27) —I support the motion which has been put forward to the House by the Prime Minister (Mr Hawke). The past several days have been a sustained moment of gravity, concentrating common sentiments among all members of this community and, indeed, of the communities of the Western world. There have been sentiments of sadness that nearly 300 lives of passengers and crew should be terminated in such a cruel, unexpected and sudden manner and grief shared with the surviving family members, relations and loved ones of those who lost their lives in this unexpected and inexcusable way. Of course, there has been anger at the way in which the incident occurred, an anger which is properly fortified by the obstinate evasiveness of the Union of Soviet Socialist Republics in refusing to acknowledge what everyone knows to have happened-namely, that a Korean commercial airliner was shot down by a Soviet military aircraft on 1 September with large scale attendant loss of life. But over and above all this we are disciplined by the recognition of our responsibility to serve the best course for the future of mankind. In that respect I thought it instructive to watch the President of the United States of America this morning delivering a statement on this matter on a television program broadcast world wide. I believe his presentation was statesman-like. There was controlled anger as he expressed firm and justifiable condemnation of what the Soviet Union had done. In the second thrust to his statement was an outline of initiatives, of reprisals, that the United States intended to implement after it had explored with its allies the best manner in which these sorts of things could be done in concert and the sort of support which would be forthcoming for the United States in taking these initiatives. Then, and most importantly, came the firm declaration that in spite of all of the anger, disillusionment and disgust at what had happened, which was experienced world wide, the United States recognises that the most important thing is to continue to draw the Soviet Union away from its paranoia and into the main stream of discourse with the rest of the world; to work for worthwhile things which will serve a better future for mankind, such as the development and, hopefully, the successful conclusion of talks such as the intermediate-range nuclear force talks and the strategic arms reduction talks, talks which are central to the future of this globe. I believe that is the way in which our discussion must be conducted in this matter. There is no room for competitive indignation. We all share the sorrow, the anger and the disgust at what has happened. For my part, I suspect very strongly, from the evidence I have seen, that it was on the part of the Soviet Union an egregious blunder; but, for all that, the blunder does not exculpate what happened. The Soviet Union should have adopted established practices to establish beyond any doubt the nature of the Korean Air Lines 747, which was a commercial aircraft, not a military aircraft. No amount of fabrication, no amount of manufacturing, can establish an alibi which will deflect the outrage of the rest of the world at what happened, the failures, the cruel and humanly destructive failures of the Soviet Union, worsened by its attempts to be obstinate in its evasiveness in an effort to avoid responsibility . What happened, happened in a geographic part of this globe which is an area of fragile accommodation, a potential flashpoint that could conflagrate the globe at any moment. What happened on this occasion demonstrates that potential amply. I repeat that it is my view that the conduct of the United States Administration , the presentation of the President of the United States of America this morning , displayed the sort of restraint which is appropriate in all of these circumstances, in spite of our experiences, our feelings. The Opposition has sought to move an amendment to the motion which has been put to the House by the Prime Minister. We recognise the genuineness of motivation on the part of members of the Opposition. This is not an occasion on which any person should seek to pick up a quick political opportunity, and it is not an occasion on which the Opposition would seek to do so. I therefore put to the Opposition that, if weighed up in a mature sense, there is nothing in the addendum which the Opposition proposes which has not been amply covered by the motion which has been moved by the Prime Minister and in the statement that he delivered in a measured and effective way today. There are three elements to the addendum which the Opposition wishes to have included in the motion moved by the Prime Minister. The first is that the Opposition, in essence, requests the Government to formulate further measures that could be taken in the event of the Soviet Union failing to respond to a request from the Government for adequate explanations and attendant matters. I assure the Opposition, as the Prime Minister sought to outline in his statement to the Parliament and as I certainly sought to establish yesterday at a Press conference, that these matters are well and truly in our mind. We have been in close contact with our friends and allies. We have been in very close contact with Washington. The Prime Minister has spoken to the Secretary of State for the United States, Mr George Shultz, on this matter, and has maintained a continuing briefing to members of the Cabinet on American proposed initiatives, sharing information with us. We have been in close contact with Seoul, especially to express our grief at what has occurred, and to discuss the matter through our representatives there, and with Tokyo and, of course, Moscow, to deliver our protest, our outrage, at what has taken place. The important point to bear in mind is that any initiatives taken in this matter must, first, be circumscribed within that common-sense approach which the Americans are displaying at this point, to which I have referred; secondly, to be effective, they have to be co-ordinated; and therefore, thirdly, they require close consultation with the United States. That we have undertaken and continue to fulfil. I mentioned yesterday that should the Soviet Ambassador fail to present a satisfactory response to our initial calling in of him and presentation of our concern on this matter we would call him in again. I repeat: We will work closely in association with our allies in this matter. The next matter that the Opposition proposed very properly, as it very properly mentioned the first matter, was that we should press immediately for just compensation for the families affected by this disaster. We give a firm undertaking to honourable members and to members of the community that this is a matter that we have under way. I mentioned yesterday that as a result of the collaboration between the Prime Minister and the Secretary of State of the United States of America, the Prime Minister was able to advise us, and I was able then to relate to the media yesterday, that this was a matter in train and continues to be in train. Of course we will make appropriate public responses to this matter as it develops further as it is our intention to keep the public informed. The third matter that the Opposition very properly stressed related to the condemnation of the Soviet Union for its barbaric act. In fact if honourable members look at page 2 of the Prime Minister's statement as circulated in the House today they will see almost precisely those words. He stated: There can be no justification for such a barbaric act. But I really do think the formulation, given the mood of the moment, of part 1 of the Prime Minister's motion is more than adequate for the task. It states: expresses Australia's shock and indignation at the totally unjustified destruction of a Korean Airlines Boeing 747 by Soviet fighter aircraft; That is severe enough, that is condemnatory enough and that is categorical enough, I believe, to meet the requirements of all honourable members. No one in this Parliament has a monopoly on concern, grief, anger or any of those sentiments. We all share them equally. In all of the circumstances, therefore, the Government, believes the Opposition's amendment is unnecessary. I think, in all those respects canvassed today on this matter, the most relevant comment is the comment that the Prime Minister made in his statement to the House a few minutes ago. He quoted the brother of one of the Australian victims who, when asked about his reaction, said: But we don't believe there should be any further violence or retribution-one act like that does not deserve another act. That seems to me to have the shape of a New Testament injunction which we could appropriately apply in all the circumstances of this continuing matter of great moment and concern. Mr MacKELLAR(Warringah)(2.38) —I seconded the amendment moved by the Leader of the Opposition (Mr Peacock) because this is a moment when, through the voice of this Parliament, the Australian people give expression to the emotions which have been stirred by the sense of horror and very deep shock which have overcome all of us since hearing the news of this bewildering tragedy. Our first reaction was one of incomprehension but then, as the evidence mounted, the full scope and deliberate callousness of this action left Australians numbed, saddened and angry. Our first thoughts are for the bereaved and our sympathy goes to the relatives, families and friends of the victims. But as a nation we have a further duty-a duty to truth and to the safety and integrity of the international air traveller. We cannot let the Soviet Union create a new set of rules for international conduct in these matters-rules which would justify not the rescue of the innocent but in fact the destruction of the innocent. The failure of the Soviet Union Government to admit the truth is monumental. A system which has lived by half truths finds itself now unable to cope with the incontrovertible fact that Soviet military aircraft were directed to shoot down an unarmed civilian airliner, fully identified by its navigation and strobe lighting system. The message was: 'The target has been destroyed'. That is the cold, callous verdict of this senseless and cruel military operation. Are we therefore expected to accept the proposition that civil aircraft over Soviet territory are henceforth to be regarded as legitimate military targets? That seems to be the thesis to be supported by Soviet subterfuges of silence, evasion and controlled leaks. The position that civilian aircraft infringing Soviet air space are automatic military targets has to be confronted and has to be resolved . That is the underlying issue. The world's response must be prompt, strong and unequivocal. The Soviet policies have to be changed to bring them into accord with civilised standards. That is essential. So far the Soviet responses to this whole affair have been totally unsatisfactory. Its first position was to imply no responsibility. The plane, we were led to believe, simply fell out of the sky. Yesterday it tried to go on to the political attack. This sort of approach had worked in the past. Always the propaganda was aimed to lead people to believe that both sides were to blame. Instead of stating factually what happened, the Soviets attempted to cover-up and complained about misrepresentation. Tass stated: The White House and the State Department are mounting a world-wide rabid anti- Soviet campaign. But Tass went on to ask: Why did the authorities of the U.S. and Japan, whose air traffic services control flights of planes on this route, knowing that the plane remained a long time in Soviet airspace, not take appropriate measures to put an end to this flagrant violation of the sovereignty of the Soviet Union? That statement bears very close consideration. A plane containing 269 men, women and children was shot down because it intruded into Soviet air space. It was identifiable as a straying civil aircraft. Its lights were on. No blame is to be attached to the Soviet Union, it seems to argue. Why? Because the plane was in Soviet air space. It was the job of the United States and Japan to stop it from being there. Their failure to do this justified the destruction of the place and 269 innocent lives. This preposterous argument is foisted on a world stricken by horror and disbelief. It is utterly cynical. It is clear that the Soviets thought they could get away with it. However, the tapes of the Soviet fighter's interception, which are to be tabled in the United Nations Security Council, will confound this utterly cynical approach. We must resist the Soviet proposition that a plane which strays into national airspace can be shot down irrespective of the nature of the aircraft. The Soviet concedes nothing about the impossibility of contacting the aircraft out of the range of air control. It is a very distasteful argument indeed to introduce a notion of blame against the Japanese air control. Nor can the Soviet Union be allowed to get away with an argument which implies that the Korean airliner was not accidentally off course but was controlled throughout into a deliberate violation of Soviet air space. This type of argument must be totally rejected for what it is-a cruel defence of the might the Soviets want to establish-the right to shoot down anything in its air space, a right which, according to the Soviet, has at all times to remain beyond question and argument. The price to be paid, if we surrender to the Soviet intransigence, will be a high one in terms of humanitarian standards of international behaviour and in terms of ordinary standards of air traffic safety. The truth is that the international obligation must clearly rest on a nation which shoots down an aircraft to justify its decision in terms which satisfy commonsense tests of morality. The failure of the Soviet Union to attempt to do this in terms which even acknowledge the facts the whole world knows points to a very deep moral crisis in the Soviet social and political system. No amount of toughing it out, riding the storm of world-wide indignation, will be able to conceal that fact. The Cambridge historian Herbert Butterfield once observed that civilisation is a fine line of defence against barbarism. This is amply demonstrated by this most tragic of events. The amendment which has been tabled today, however, recognises that there are further developments to be taken into account as the international community addresses this issue. There is no scope for Australia to take-as other countries are about to do-action on a bilateral civil aviation basis. We must be prepared to demonstrate that, if the Soviet Union does not come to acknowledge her culpability in terms which can reasonably be considered as coherent, convincing and suitably regretful, a further judgment by Australia should ensue. The Soviets should in no way be allowed to feel that we are not determined in our attitude. So far, as the Prime Minister (Mr Hawke) has acknowledged, the Soviets have provided no information in answer to our requests . We in the Opposition feel that to appear to say in advance that there can be no adverse consequences for our bilateral relations if they refuse us would be wrong. There is a danger that the motion of the Government, without amendment, could lead to that result. I am sure it is not intended, but it could lead to that result. Mr Speaker, the Leader of the Opposition has made very clear we are not going to divide on this matter. We have listened to the arguments by the Minister for Foreign Affairs (Mr Hayden) wherein he acknowledges the correctness of the propositions put by the Opposition. We urge the Government to accept the amendment which makes the position of this Parliament more clear than the motion moved so far by the Government. It will be a resolution of this Parliament, not a resolution of the Government, and it should be seen as such. We urge the Government to accept the amendment which is tendered in a bipartisan spirit and which we believe conveys the sense of this House, and accords with the spirit of the Government's approach. Amendment negatived. Original question resolved in the affirmative. Mr Scholes —Mr Speaker, I ask that the vote on this matter be recorded in the Votes and Proceedings as a unanimous vote of the House. There is no actual means by which that would be done normally. Mr SPEAKER —I think the Minister for Defence has made the point by having his remarks included in Hansard. The Clerk-Petitions have been lodged for presentation as follows and copies will be referred to the appropriate Ministers: Chiropractic Services To the honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of certain citizens of Australia shows : That, with the exception of the Australian Capital Territory and the Northern Territory, all State Parliaments have enacted chiropractic legislation. That chiropractors provide a safe, effective and economical health care service that is complementary to medicine. That the introduction of a Federally funded health care system restricted to the services provided almost exclusively by the medical profession, with its traditional approach, restricts the freedom to select the health care practitioner of one's choice and does nothing to reduce the excessively high cost of health care in Australia. That a financial disadvantage will be incurred by those citizens utilizing chiropractic care, many of whom find that their health complaints are vertebrogenic (spinal) in origin and therefore do not respond satisfactorily to traditional approaches. Your petitioners therefore pray that the House of Representatives in Parliament assembled ensures that chiropractic services are included in Medicare when it is introduced. by Mr Andrew,Mr Anthony,Mr Baldwin,Mr Blanchard,Mr Ian Cameron,Mr Cohen,Mr Connolly,Mr Dawkins,Mr Drummond,Mr Fisher,Mr Steele Hall,Mr Humphreys,Mr Hurford,Mrs Kelly,Mr Lusher,Mr Millar,Mr Moore and Mr Uren. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of concerned people respectfully showeth their desire to stop the commercial exploitation of the kangaroo. Your petitioners therefore humbly pray that your honourable House re-apply the ban on the export of kangaroo products. And your petitioners as in duty bound will ever pray. by Mr Beazley,Mr Blanchard,Mr Ronald Edwards and Mr Humphreys. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. We the undersigned citizens of Australia, believing that men and women are equal but different, convinced that Australia can provide equal opportunity for all citizens without foreign treaties, concerned that ratifying the UN Discrimination Convention would give a Communist-dominated international committee the power to judge Australia's laws, humbly petition that your honourable House will not ratify the UN Convention on the Elimination of All Forms of Discrimination against Women and we will always thus petition. by Mr Anthony,Mr Steele Hall,Mr Wilson and Mr Young. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of undersigned citizens of Australia respectfully showeth: 1. The concerns which people around the world have for the increasing stockpiles of weapons of mass destruction; 2. The global concern that any nuclear exchange will inflict on humanity unimaginable death and suffering; 3. The vulnerability that Australians will face in any nuclear conflict between the major powers; 4. The public concern that Government should explore all avenues to ensure that the nuclear threat is eliminated. Your petitioners therefore humbly pray that the Australian Parliament establish a Select Committee on Nuclear Disarmament and Peace to investigate the creation of a Ministry of Peace and Nuclear Disarmament. And your petitioners as in duty bound will ever pray. by Mr Cohen,Mr Connolly,Mr Dobie and Dr Harry Edwards. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of certain citizens of Australia shows-that at present, certain infertility treatments including hormonal drugs, procedures and laboratory services, are not covered by any health insurance due to non- itemisation on the Commonwealth Rebate List. The psychological and emotional stress of infertility is therefore increased by the added financial stress. Your petitioners therefore pray that the Parliament will view our plight to create life with sympathy, by recognising our needs and taking action to include the abovementioned items on the Commonwealth Rebate List. by Mr Blanchard,Mr Ronald Edwards and Mr Rocher. The Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned citizens of Australia showeth that: The Universal Declaration of Human Rights affirms the principle of the inadmissibility of discrimination and proclaims that all human beings are born free and equal in dignity and rights and that everyone is entitled to all the rights and freedoms set forth therein, without distinction of any kind including distinction based on sex. However extensive discrimination against women continues to exist. It is an obstacle to the participation of women on equal terms with men, in the political , social, economic and cultural life of this country. It hampers the growth of the prosperity of society and the family and makes more difficult the full development of the potentialities of women in the service of this country and of humanity. Your petitioners therefore humbly pray that the Commonwealth Government will act to ratify the convention on the elimination of all forms of discrimination against women. by Mr Macphee,Mr O'Neil and Mr Scott. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth that whereas the Government of Australia has signed the United Nations Covenant on Civil and Political Rights which in Article 23 (1) states that ''The family is the natural and fundamental group unit of society and is entitled to the protection by society and the State''. And whereas the terms of the United Nations Convention on the Elimination of All Forms of Discrimination against Women would violate the above Article 23 (1) We humbly pray the Government to refrain from ratifying the Convention on the Elimination of All Forms of Discrimination against Women; believing that its implementation would result in: (1) Undue cost to the nation at this time. (2) ''The elimination of any sterotyped concept of roles of men and women at all levels'' as described in Part 3 Article 10 (c), being a disruption of traditional parental roles, is likely to result in emotional disturbances of childhood. (3) The strong encouragements to mothers to join the workforce, with the provision of networks of creches and child care centres as outlined in Article 11 of the convention is likely to result in maternal deprivation and psychological disturbances among children with an increase in childhood psychiatric illnesses. (4) The sexual role changing as recommended in Part 3 Article 10 (c) is likely to contribute to further marriage insecurity and breakdown. And we pray you may be conscious of God's sovereign purpose for our nation and your petitioners in duty bound will ever pray. by Mr Ian Cameron and Mr Hodgman. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. This petition of certain citizens of Australia shows: That payments to contract and sub-contract owner-drivers of trucks are likely to be reduced by ten per cent on implementation of the new system of tax deduction at source from payments for work and services; That profit or personal remuneration constitutes a very small part of payments received by owner-drivers, compared with capital and running costs and government charges; and That a deduction of ten per cent of gross payments would not only be much greater than required to protect the revenue, but would also cause hardship to owner-drivers and their families. Your petitioners therefore pray that the Government will not require tax to be deducted from payments to owner-drivers. And your petitioners as in duty bound will ever pray. by Mr Rocher and Mr Tuckey. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. We the undersigned citizens of Australia are concerned about the deterioration of human rights and the general harassment and oppression of Church and community workers in the Philippines. The recent cases of Fr Brian Gore and Karl Gasper illustrate this situation. We urge the government to express forcibly this concern. We call on the Australian Government to intercede on behalf of Karl Gasper so that the Presidential Commitment Order, under which he is being detained, be lifted and charges be laid so that a trial may commence. Further we petition the government to reconsider any form of assistance to the Philippine Military Forces whilst these same forces continue to disregard basic human rights. And your petitioners as in duty bound will ever pray. by Mr Blanchard. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled: The humble petition of the undersigned citizens of Australia respectfully showeth. 1. That an airport in the north-western region (commonly called Scheyville) imposes disastrous economic, environmental and social costs on our community. 2. An airport would destroy 2,000 households and impose upheaval, noise and pollution on one million people presently unaffected. 3. The cost of an airport in the north-western region is greater than the alternatives, whilst fog and close proximity to RAAF Base Richmond would make operations impractical. 4. It would destroy the historic village of Pitt Town, environmentally important wetlands, and their unique adherent wildlife. 5. Your petitioners reject these proposals and call for endorsement of the MANS Committee findings. And your petitioners as in duty bound will ever pray. by Mr Cadman. To the Honourable the Speaker and members of the House of Representatives in Parliament assembled. The humble petition of certain citizens of Australia respectfully showeth: We the undersigned petitioners are employees of Merritt and Booth Pty Ltd and Merritt and Booth Plant Hire Pty Ltd. These firms have conducted business for about twenty-five years as earthmoving and drainage contractors. Currently there are employed forty-three citizens by the abovenamed firms. It has been brought to our attention that this Honourable Parliament intends to give effect to a system of taxation known as ''The Prescribed Payments System''. We wish to call to the attention of This Honourable House the effect which this tax will have upon the companies for which we work. As a direct result of this source tax we are informed that a cash flow problem will develop. We are further informed that this will result in retrenchments of several of the current employees of these firms. Your petitioners therefore humbly pray that this Honourable House reconsider the introduction of the ''Prescribed Payments Scheme'' and bear in mind the plight, of we the undersigned petitioners, which awaits us if the abovementioned scheme is brought into operation: And your petitioners as in duty bound will ever pray. by Mrs Darling. To the Honourable Speaker and members of the House of Representatives of the Australian Parliament in Canberra assembled. The petition of certain citizens respectfully showeth: That the right to work without discrimination on any ground including, inter alia, discrimination on grounds of race, ethnic origin, pregnancy, marital status, sex and/or sexual preference, is a fundamental human right; and That it is both the duty and the responsibility of society to fully support those denied work and therefore those who are unemployed as a result of society' s inability to provide full paid employment should be guaranteed an adequate income without discrimination on any ground, including inter alia discrimination on grounds of race, ethnic origin, marital status, sex and/or sexual preference, or pregnancy. Your petitioners therefore humbly pray- That appropriate and adequate laws be formulated and passed to outlaw discrimination in Commonwealth employment, in employment of persons by statutory bodies and quasi-governmental organisations, in employment of individuals under federal awards, and in employment of all persons in areas over which Commonwealth and Australian Capital Territory equal opportunity legislation should have jurisdiction; and That appropriate laws be formulated and passed to outlaw discrimination in the provision of unemployment benefits to all persons without regard to race, ethnic origin, marital status and/or sex. And your petitioners as in duty bound will ever pray. by Mr Ronald Edwards. To the Honourable Speaker and members of the House of Representatives in Parliament assembled Re: Income Tax Assessment Amendment Act of 1983: We wish to express our extreme concern and alarm at the decision of the Federal Government to introduce the above legislation from 1st September 1983. The impact of the legislation will be devastating to the electrical contracting and building construction industry and will only result in the loss of jobs and substantial increases in costs. The impossible conditions placed by the Australian Taxation Office on obtaining exemption certificates by 1st September will place our businesses in financial jeopardy, irrespective of the fact that we have fulfilled our taxation obligations at all times. Needless to say that this will affect all electrical contractors and sub-contractors in a similar fashion. To have up to 10% of our turnover withheld as tax whilst we are subject to provisional tax shows a total disregard to the business sector and a total lack of knowledge of the electrical contracting industry by our legislators. In view of the failure of the Taxation Office to produce the relevant documentation and the burden on Accountants with annual taxation audits and returns at this time of the year, we would respectfully request you to urgently raise this matter on behalf of the electrical contracting and construction industry for a total review of the implications involved and also a deferment of the operative date. Your petitioners therefore pray that the House of Representatives and Parliament will take note of their petitioners and constituents. by Mr Gayler. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth: Holders of the health care card and pensioner health benefits card cannot receive any level of free dental care from private dentists, as they can medical care from private doctors. The existing network of private dental practices will need to be the principle mode of dental care delivery. Your petitioners therefore humbly pray that: Holders of the health care card and pensioner health benefits card should be provided with free dental care through private dentists, immediately. Dental care be included in the formulation of Medicare. And your petitioners as in duty bound will ever pray. by Mr Hawker. To the Honourable, the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of the Commonwealth of Australia respectfully showeth: 1. That, as tenants of public housing estates, we are concerned about the lack of security for people and property on estates. 2. The Ministry of Housing in Victoria states it can not improve security due to public service staff ceilings. 3. These ceilings are a direct result of insufficient Commonwealth funds being made available to the State of Victoria. Your petitioners therefore pray that the Commonwealth increase the money available to the State of Victoria for public housing and your petitioners as in duty bound will ever pray for your thoughtful consideration of their plea. by Mr Hurford. We the undersigned citizens of Australia and employees of the gas industry respectfully showeth. That the Government's decision to apply tax at the rate of at least 30 per cent to lump sum superannuation benefits accrued after 1 July 1983 from primarily the employers' contributions: (a) is unfair to those employees who have foregone salary during work-lives to contribute to superannuation schemes within an accepted and appreciated system whereby such employees judiciously and conservatively prepared for a more secure and stable retirement than would necessarily be provided by social security benefits alone; (b) is not in the interests of providing jobs and careers for the youth of Australia in that it may create a tendency for employees to continue to work longer than would be the case at present so to allow either the accumulation of comparable net lump sum benefits or to allow the purchase of a higher annuities if the latter be prescribed as stated; (c) is likely to act as a disincentive to employees to contribute to a superanuation scheme and thereby add to the number of recipients of social security benefits; (d) is not the way a Government should increase its revenue/reduce its deficit under the guise of correcting an inequity (i.e. between pensions from a superannuation scheme being fully taxable whereas 5 per cent of a lump sum is fully taxable) or eradicating an alleged tax avoidance (i.e. 'double-dipping') scheme which it is not as it is and has been perfectly legal; removal of taxation applying to pensions payable from superannuation schemes would have been equitable to take a pension or part-pension in preference to a full lump sum and thus contributed towards the Government's objectives; (e) should not be utilised in the ensuing debate to generate reviews of a nature leading to the imposition of new taxes on capital gains or property assets arising primarily out of the employment of those who have had moderate means and income as employees. Your petitioners therefore humbly pray that the House will request the Government to repeal its decision to impose such tax on lump sum superannuation benefits and to desist from further changes adverse to the means and well-being of those to retire or in retirement. by Mr Keating. To the Honourable the Speaker and Members of the House of Representatives assembled. The humble petition of the undersigned citizens of Australia respectfully showeth that: 1. Omega by sending low frequency signals, penetrating sea water enables hunter -killer submarines to establish their position and to launch a 'first strike' attack. Omega is also used by AWACs, the flying radar stations, and for other military purposes. 2. Omega is an important U.S. military base and a potential nuclear target. A nuclear attack on Omega would have a disastrous effect on Victoria and Melbourne . 3. Omega and other U.S bases in Australia endanger, rather than protect us. They add a new unnecessary menace to a nuclear arms race that must be stopped, if we are to survive. Your petitioners pray that Members and the House assembled will close Omega. by Mr Milton. To the Honourable the Speaker and Members of the House of Representatives in the Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth: That the railway crossing situated approximately 5 kilometres east of Port Augusta on Highway One (the main highway between Adelaide and all northern and western centres of South Australia and continuing through to Western Australia) has once again been the sight of an horrendous accident. This accident has caused two, possibly three fatalities. Previous requests have been made by the city council of Port Augusta for the construction of an overpass, so that this section of the highway no longer presents a danger to the motoring public and those involved in driving trains over this crossing. Permission for construction of this overpass has previously been refused and the situation has now become critical. Your petitioners therefore humbly pray that the Federal Government will reconsider their previous decision and approve construction of an overpass at this fatally dangerous railway crossing to avoid further loss of life. And your petitioners as in duty bound will ever pray. by Mr O'Neil. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned citizens of Australia showeth that: We the undersigned workers of Monier Sleepers demand that you do all in your power to protect our jobs, which due to a lousy budget (especially the allocation of rail funds) appear to be in jeopardy. The present contract finishes on November 4th and no other work is on the books at this time. The closure of this plant would mean a loss to Port Augusta of half a million dollars a year in wages. Expenditure in the Iron Triangle amounts to three- quarters of a million dollars a year. Your petitioners therefore humbly pray that the Commonwealth Government will act to prevent the closure of the Monier Sleeper Plant in Port Augusta. by Mr O'Neil. To the honourable the Speaker and members of the House of representatives in parliament assembled: We the citizens of the City of Woodville and supported by the citizens of South Australia, being deeply concerned over the threat of closure of the Woodville plant of General Motors-Holdens, respectfully show: 1. That the management of General Motors-Holdens has failed over a period of more than two (2) years to give any assurances that the Woodville plant would continue in operation. 2. That a recent statement attributed to the GMH Managing Director: 'The overall objective of our South Australian rationalisation plan has been to eliminate all productive activities on the Woodville site' has not been refuted. 3. That the elimination of the Woodville plant will cause enormous social dislocation, hardship and misery to the citizens of Woodville and South Australia. Your petitioners therefore pray that the Parliament of Australia will condemn this callous disregard for the citizens of Woodville and South Australia, and do all in its power to force General Motors-Holdens to retain its operations at the Woodville plant. by Mr Scott. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully request: That the Government's decision to introduce a means test for over-70 pensions be reversed, as it will cause undue hardship and an unreasonable financial burden on a significant percentage of the aged population of Australia. Your petitioners therefore humbly pray that the Government will withdraw this legislation. And your petitioners as in duty bound will ever pray. by Mr Shipton. To the Parliament of the Commonwealth of Australia. The humble petition of the undersigned citizens of Australia respectfully showeth: That over 2000 political prisoners in Istanbul prisons have been on hunger strike since 4th July, 1983. Their demands are: withdrawal of prison uniforms and return of civilian clothes an end to torture, oppression and all kinds of prohibitions, for example, on interviews with lawyers, families, going out to fresh air, receiving books and writing materials abolition of the cell system which is established for torture and bloody intrigues; return to the system of wards recognition of all rights to the political prisoners Therefore, we humbly request the government of the Commonwealth of Australia: to put pressure on the Turkish government to meet the demands of the political prisoners who are hunger striking in Turkey to send an independent delegation from Australia, made up of members of the legal profession, medical profession, church, press, unions, parliament and democratic people, on a fact-finding mission and later to publish the uncensored report of this delegation to grant political asylum for people from Turkey to take action to stop the pressure on Turkish migrants by the official representatives of Turkey in Australia (i.e. embassies, consulates) and to investigate the activities of these representatives and make public the results of the investigation to protest the fascist oppression by the government of minorities, primarily the Kurdish nation in Turkey to review its diplomatic relations with Turkey and to publicise the demands in this petition And your petitioners as in duty bound will ever pray. by Mr West. To the honourable the Speaker and members of the House of Representatives in Parliament assembled. The humble petition of the citizens of Western Australia respectfully shows: last year, over 3,300 people died on Australian roads; alcohol is a factor in 50 per cent of road deaths; alcohol advertisements do not show the perils of driving after drinking alcohol ; alcohol advertisements are glamorous and increase their effect on teenagers, indicating drinking alcohol as the social pastime; Your petitioners therefore humbly pray that the Parliament will legislate to ban the advertising of alcohol from commercial television and radio. And your petitioners as in duty bound will ever pray. by Mr Ronald Edwards and Mr O'Keefe. To the Honourable the Speaker and Members of the House of Representatives of the Commonwealth of Australia in Parliament assembled. The petition of certain citizens of New South Wales respectfully showeth that the Federal Government should have allowed Parents and Citizens Associations and other such bodies exemptions from the Bank Accounts Debits Tax Administration Act. Your petitioners therefore humbly pray that your honourable House will amend the Act to allow such bodies to be exempt from the tax. And your petitioners, as in duty bound, will ever pray. by Mr Keating. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of certain citizens of the Division of Moore respectfully showeth: That there is great need for the establishment of a new Community Youth Support Scheme project in the Subdivision of Girrawheen, because of the high level of youth unemployment in this subdivision, in order that the CYSS project can provide a range of activities which develop the skills, abilities and self reliance of unemployed young people resident in the Subdivision of Girrawheen. Your petitioners therefore humbly pray: that proposals for the establishment of a new Community Youth Support Scheme project in the Subdivision of Girrawheen be granted favourable and prompt attention by this Parliament and its Ministers. And your petitioners as in duty bound will ever pray. by Mr Blanchard. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of certain citizens of the Division of Moore respectfully showeth: That there is great need for the upgrading of the Quinns Rocks telephone system which passes through the Neerabup telephone exchange. Your petitioners therefore humbly pray: That an upgrading of the Quinns Rocks telephone system through a new exchange, currently planned to come into operation in 1986-87, be brought forward so that it commences operation in the 1983-84 financial year. Your petitioners also pray that the microwave link joining Wanneroo to Quinns Rocks be completed in 1983-84 therefore greatly improving the inadequate communications facilities that these citizens presently endure. And your petitioners as in duty bound will ever pray. by Mr Blanchard. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. We, members of St Andrews Uniting Church in Australia situated at Kings Road, Brighton-le-Sands, desire legislation passed through Parliament providing for: (i) The granting of title to all Aboriginal Reserves to the Aboriginal groups currently related to them, (ii) The land needs of groups in places where Reserves are not currently available or if available are inadequate for their reasonable needs, and (iii) Freedom for Aborigines to lay claim to sites of particular significance to them, for example Mumbulla Mountain on the South Coast of New South Wales which to be effective would need to require the right to control timber cutting. Any such title granted must be inalienable except by decision of a designated majority of the Aboriginal group concerned with permission of the Supreme Court or by Act of Parliament. The legislation should also include a guarantee of the group's right to self-determination in the organization of their community's internal affairs. And your petitioners as in duty bound will ever pray. by Mr Punch. Petitions received. Mr TUCKEY(O'Connor) —I give notice that, on the next day of sitting, I shall move: That this House- (1) condemns the Russian nation for its callous and unnecessary act to deprive thousands of innocent nationals, including Australians, of their families and relatives, by the shooting down of an unarmed commercial airliner; and (2) calls on the Australian Government and all free nations of the world to expel or repatriate immediately all the families of Russian diplomats or nationals residing with them so they too may feel at least temporary deprivation of family. Mr RONALD EDWARDS(Stirling) —I give notice that, on the next day of sitting, I shall move: That this House- (1) notes the successful conclusion of the latest Commonwealth bond tender and its consequent lower interest rates; (2) urges Australian financial institutions to seek, where possible, to lower interest rates on housing mortgages; and (3) urges wage and price restraints on unions and employers in the building industry. Mr EWEN CAMERON(Indi) —I give notice that, on the next day of sitting, I shall move: That this House- (1) expresses its complete satisfaction with the design of the existing Australian national flag; and (2) acknowledges that- (a) the flag has been a source of inspiration to generations in peace and war; and (b) any change to the flag will produce division in the Australian community. Mr Gear proceeding to give a notice of motion- Mr SPEAKER —Order! The honourable member's notice is out of order. Mr Hodgman proceeding to give a notice of motion- Mr SPEAKER —Order! I ask the honourable member to re-phrase his notice. It is out of order. Mr WELLS(Petrie) —I give notice that, on the next day of sitting, I shall move: That this House condemns the Bjelke-Petersen Government- Opposition members interjecting- Mr WELLS —Not to mention its clones in this House- Mr SPEAKER —Order! The honourable member for Petrie will proceed with his notice of motion. Mr WELLS —I give notice that, on the next day of sitting, I shall move: That this House condemns the Bjelke-Petersen Government for its insistence on pursuing a course of one party minority government in Queensland while refusing to recall the Parliament. Mr COLEMAN(Wentworth) —I give notice that, on the next day of sitting, I shall move: 1. That this House notes that- (a) the major research and development activity at the Lucas Heights research laboratories of the Australian Atomic Energy Commission is the program of uranium enrichment using centrifuge technology, and (b) this program is supported by national energy research development and demonstration grants, and 2. Condemns the Government for its decision to end this program. Mr RONALD EDWARDS(Stirling) —I give notice that, on the next day of sitting, I shall move: That this House applauds the success of the Australia II America's Cup syndicate in its challenge for the America's Cup. Mr HODGMAN(Denison) —I give notice that, on the next day of sitting, I shall move: That this House- (1) notes the statutory declaration dated 6 September 1983 of Mr Bernard Goumy, and (2) reprimands the Soviet Ambassador, Mr Evgeny Samoteiken, for his behaviour at Canberra Airport on Friday, 2 September 1983. Mr ANTHONY —I wish to direct my question to the Prime Minister. The Prime Minister has publicly supported the development of uranium mining and export from Roxby Downs and approval of new contracts for uranium exports from Nabarlek and Ranger mines. I welcome those statements. But I ask the Prime Minister: How does he reconcile his views with the statement by his Minister for Foreign Affairs, reported on 8 June, that he would not support approval of new contracts and the comments yesterday by the President of the Australian Council of Trade Unions, Mr Dolan, supporting opposition to Roxby Downs and opposing any change to the Government's uranium policy? Further, will the Prime Minister assure the House that the Government will not treat uranium from Roxby Downs, Nabarlek and Ranger any differently from uranium from the proposed mines at Jabiluka, Koongarra and Yeelirrie, which have been given export development approval? Mr HAWKE —I say at the outset that Mr Dolan will speak for the Australian trade union movement and will express his opinion. He will not be expressing the opinions, views or decisions of the Australian Government. Let me make clear the position of this Government and the Australian Labor Party on this admittedly vexed issue of uranium mining. The platform of the Labor Party clearly recognises that the Government would be faced with an existing industry, including contracts and agreements with customer countries. The platform also clearly allows for the consideration of projects where uranium would be mined incidentally to the mining of other minerals and where the Government considered the mining of such minerals to be in the national interest . It is well known that Roxby Downs also has major deposits of copper and gold. It is one of the world's major underdeveloped mineral resources. All honourable members will appreciate that Roxby Downs is of particular significance to the economy of South Australia as well as to the Australian economy as a whole. In the context of this policy on existing mines-and Roxby Downs-the Government is currently undertaking a review of all aspects of the industry, including the international safeguards aspects. The review will be considered by the parliamentary Party in the near future. Any continuing exports will be on the strictest conditions and will be undertaken in the light of the considerations that I have put forward. It is known that we have taken action already in respect of exports of uranium to France. I remind the House, so that I can give the complete picture in this matter, that when I was in Paris recently I had discussions with President Mitterrand. Against the desires of the recipient in France and the exporting company in this country, I indicated that there would be no further shipments at this stage. I remind the House that that did not involve an infringement of the contract because there was no requirement under that contract for shipping before October 1984. With regard to shipments to France, in the period between now and October 1984, when there would be a requirement under the contract, we will be conducting discussions and negotiations with the Government of France with a view to securing a cesssation of nuclear testing in the South Pacific. That is an accurate statement of the position of this Government. When the review which is being prepared has been considered by the committees of the Government and by the Cabinet, a decision will be made. An announcement will be made accordingly in this House. Ms McHUGH —I ask the Prime Minister: What progress has the Federal Government made in implementing the prices and incomes accord with the trade union movement ? Is that progress sufficient to give the Government the authority to request trade unions to confine wage increases to those granted in national wage cases under the centralised wages system? Mr HAWKE —I know that members of the Opposition are looking forward to their customary serve on this matter. I assure them that it is coming in a more concentrated form. The Federal Government has available to it the conventional policies in the fiscal and monetary areas. But this Government has available to it an additional instrument of policy which was recognised in the honourable member's question- that is, the prices and incomes accord. This means that we do not have to rely simply on the blunt economic instruments of policy which attempt to contain inflation only by stopping growth and creating unemployment. We are proud, as a government, to say that very considerable progress has been made in implementing the accord across a very wide range of fronts. The Government, as is well known, has supported a return to the centralised system before the Australian Conciliation and Arbitration Commission. That is indeed a linchpin of the accord. In those submissions we have also supported six-monthly wage indexation before the Commission. We have not addressed ourselves under the accord to only the question of wages claims; we have in addition asked companies to exercise restraint in setting dividends and other non-wage incomes such as directors' fees. We have also sought the support of professional bodies for restraint in the level of fees. Also in the current sittings legislation will be introduced to establish the Prices Surveillance Authority and, as part of the accord, we have abolished the pernicious Industrial Relations Bureau. In addition, Medicare and community employment programs are being implemented in line with the accord. It is known that at the Premiers Conference we took special steps to assist the States in a way which would enable them to resist pressure to raise taxes and charges, which they would have had to do had we not given them that additional $155m. Further, we have set up the Economic Planning Advisory Council. That necessarily brief outline of the important things that have been done under the prices and incomes accord, that coherent and co-operative approach, contrasts starkly with the total vacuum on the other side of the House. I remind honourable members of just what has transpired recently. At the National Press Club on 27 July the Leader of the Opposition, talking of a totally hypothetical situation, said that if there were a change of government the Opposition would in fact inherit a centralised system. This is attempted policy mark 1. At the National Press Club on 27 July the Leader of the Opposition said that in those circumstances the Opposition would allow the centralised wage system to continue for a period. But he could not say what would happen after that because he could not make up his mind at that stage. That was on 27 July, when the Australian community had an opportunity of hearing policy in this area from the Leader of the Opposition. A few days later, last Wednesday, 31 August, at the same venue the Deputy Leader of the Opposition said: The time has come when we have to turn Mr Justice Higgins on his head. Of course, what he was trying to do was to turn the Leader of the Opposition on his head, because he had a quite different policy. The Deputy Leader of the Opposition said that he wanted to overturn the principle of comparative wage justice, which is the base upon which the centralised wage system operates; and he on that occasion, as distinct from the Leader of the Opposition, placed himself squarely in the camp of the vocal proponents of the decentralised wage fixation system. That is possible policy mark 2. Then enters mark 3. Of course, it is put by the shadow Minister for Employment and Industrial Relations, the third member of this amazing threesome. Of course, the shadow Minister for Employment and Industrial Relations strongly supports the centralised system. In May, the House will recall, he circulated a paper in which he took to task the Deputy Leader of the Opposition and others who thought in similar vein. This is what a report mark 3 had to say: . . . mere talk of market forces operating was doomed to fail miserably and to aggravate the economy . . . The situation is that only in the wages policy area have members of the Opposition sought to make any serious attack on the Government in regard to its economic policy. But unfortunately for them, they have come at if from three different and conflicting directions. I remind the House of what the now Leader of the Opposition said when he was Minister for Industrial Relations: There is a need to take a long and serious look at centralised versus decentralised methods of wage fixation . . . That was over two years ago and he and his colleagues are as confused now as they were then. The only thing that one can get out of this conflicting and confusing welter of approaches from the Opposition is that it believes that in no circumstance and on no occasion should there be any increase at all in wages. The policy of this Government is absolutely clear. We believe that there should be an equity of approach in this matter and that restraint should be exercised by all people who make claims upon the limited resources of this country. We are supporting at the national wage case an increase of the limited kind we are talking about. I make it quite clear on behalf of this Government that we expect the Australian Council of Trade Unions and the associated unions to abide by the decision that will be handed down in regard to those wage claims and that no claims shall be made by them outside the centralised system. Mr MACPHEE —I ask the Prime Minister a question about the terms of the answer he has just given. I refer to an interview reported in this week's Business Review Weekly in which he indicated that the Government would support the ratification of a $20 pay rise in the building industry. Is it the intention of the Government to see moneys expended by Federal and State governments on employment creation in fact go on increased wages in the building industry? Is it the intention of the Government to see that begin a new community wage round flowing on to metal, electrical and other workers as the President of the Australian Council of Trade Unions has indicated? Does the Prime Minister really believe that a $20 wage increase for 130,000 workers in the building industry is justified in terms of the National Economic Summit Conference communique as special or extraordinary circumstances? What are the principal special features that he refers to? Surely they are that there is a recovery led by the money invested by governments and the turbulent, destructive nature of industrial relations led by the Builders Labourers Federation. Mr HAWKE —I am indebted to the shadow Minister for Employment and Industrial Relations for his question. The position of the Government in regard to the proposed building industry agreement is quite clear. As I indicated earlier, it is that sectional claims are not to be allowed other than in special or extraordinary circumstances. Opposition members-Ha, ha! Mr HAWKE —Laughter has never been any substitute for rational and intelligent thought. Mr Tuckey —Well, you had better start laughing. Mr HAWKE —I can assure the honourable member that I am laughing now and I will be laughing for many years. Over a very long period in Australian industrial relations the building industry has been regarded as a sector of the Australian economy in which it is appropriate for special allowances to operate because of the circumstances of that industry. The circumstances, of course, are varied, but one obvious feature of them is the transient nature of the work force, the fact that employees go from job to job. In the history of Australian industrial relations that fact has been recognised as giving rise to particular allowances. It is the case that the Australian Conciliation and Arbitration Commission will need to be satisfied with the various allowances agreed to between the parties- that is, the employers and the trade unions. In these inane interjections we hear about the unions but we hear nothing about the fact that it takes two to tango. The agreement will be between the trade unions and the employers. The Commission will need to be satisfied that the terms and conditions negotiated between the employers and the trade unions meet the requirements of the accord that have been referred to. I make this final point: The Australian economy over recent years has suffered from the fact that industrial relations in the building industry have been disastrous. They have been a disgrace to many of the trade unions involved and to many of the employers involved. This agreement is not simply to be a one- sided arrangement by which there will be some increases in allowances for special circumstances. On the other side of that agreement will be the very real prospect of two years of industrial peace. If as a result of the negotiation of that agreement we can have two years of industrial peace in this hitherto turbulent industry the building and construction industry will prosper; it will also be of great significance to the overall welfare and development of and increased activity in the Australian economy in general. Mr MILDREN —I direct my question to the Minister for Science and Technology. Has the Government made any decision about the future of the Australian National Animal Health Laboratory? Mr BARRY JONES —Total expenditure on ANAHL near Geelong now amounts to $157m with an annual projected operating cost of $8m. But given modern developments in biotechnology and diagnostic procedures the Government is very concerned about the future of ANAHL. In late 1972 the McMahon Government approved the commencement of design work but it was not until March 1978 that construction began under the Fraser Government. Construction was speeded up in 1979 after a Tasmanian outbreak of a vesicular disease in pigs with symptoms resembling those of foot-and-mouth disease. While the building has been under construction a revolution has been taking place in the diagnosis of animal diseases. There is now a major difference of scientific opinion about how best to tackle the problems of diagnosing and treating exotic and indigenous animal diseases. This is essentially a difference between a rigid, centralised approach, such as that of ANAHL, or a flexible, decentralised model using experienced flying squads of diagnosticians, as recommended by the Australian Academy of Science. The Academy 's report on establishing a mobile diagnostic capacity for foot-and-mouth disease in Australia was released in August. The Commonwealth Scientific and Industrial Research Organisation is in a position of great embarrassment about the future of ANAHL. The CSIRO Chairman recently recommended to me that a ministerial committee be set up to consider the future of ANAHL. The Prime Minister has agreed that a ministerial committee will be established immediately comprising the Minister for Trade, the Minister for Defence, in whose electorate ANAHL is located, the Minister for Primary Industry, the Minister for Health and me. Mr ROCHER —Is the Minister for Employment and Industrial Relations aware that a couple of weeks ago the national wage case bench was advised that certain employers in the building industry look like reaching an agreement which, amongst other things, will provide for a general increase to allowances of 19.8 per cent and the introduction of a new allowance of $7.50 per week called a building industry recovery procedures allowance? Does the Government intend to intervene in proceedings due to commence soon before the Australian Conciliation and Arbitration Commission? Does the Government agree that the proposal constitutes a sectional increase and, therefore, is contrary to the Government's intention that there should be a return to a centralised wage fixing system? If so, does the Government intend to oppose the proposed increases? Mr WILLIS —The question asked whether I am aware of the agreement. Yes, I am. By the way, the agreement was finalised today in respect of all unions except the Plumbers and Gasfitters Employees Union of Australia which, apparently, would not accept the proposal in regard to no ticket-no start. The procedure now is that the parties will go to the Commission tomorrow before Mr Justice Ludeke who will then set a date for a Full Bench to hear the ratification application. The question asked whether we will intervene in that case. Yes, we will. In fact, we have already appeared before the Commission indicating our intention to intervene. I have been asked whether this is a sectional claim. I think the Prime Minister has already covered this ground fully in the answer given to the previous question. But I can say, in perhaps a slight elaboration of that, that of course the Government is concerned about any sectional claim. It is concerned about the cost of the package in regard to the building industry and particularly the implications for flow-on. It is clear that that is a matter of concern to us. Indeed, we shall be taking it up in the Australian Conciliation and Arbitration Commission. In regard to the flow-on implications, we are concerned particularly about that part of the package to which the honourable member referred, known as the building industry recovery procedures allowance-otherwise known as BIRPA, which I suppose connotes an element of indigestibility. We shall be giving full consideration to the implications of that, particularly in respect of any possibility of flow-ons and bearing in mind what that could do in regard to general wages policy. When the matter comes before the Commission, on a date yet to be set, we shall be elaborating on that concern and putting a detailed submission to the Commission. Mr LINDSAY —My question is directed to the Prime Minister. Will the Federal Government provide Commonwealth funding necessary to ensure completion of stage 1 of the Burdekin Dam by 1988? Mr HAWKE —I thank the honourable member for his question. I know, as do all members of the House, his very long-standing commitment to the building of the Burdekin Dam. Way back in 1976, the honourable member helped to set up the Townsville-Burdekin Regional Water Committee to lobby for the construction of the dam. He has played a very important role in convincing the Federal Cabinet to build the dam. Given his long-standing and total commitment to the building of this project, I want to assure him that, yes, this Government is totally committed to the continuity of funding. The construction is still in its very preliminary stages but it will pick up next year. Of the $13m appropriated for this project in the Budget, $8.5m will be required to complete the construction village, the permanent and portable buildings, telecommunications, power supply, water supply, sewerage, village roads, workshop and caravan park amenities. The balance of this very generous budgetary allocation, the balance of $4.5m, will be used to begin construction of the main dam. The Federal Government's decision to build the dam reflects our commitment to integrated forward-looking development of our natural resources. It will provide an enormous boost to north Queensland in terms of construction, irrigation, jobs , new contracts, new demand, and new confidence. Opposition members interjecting- Mr HAWKE —I know the unhappiness on the other side of the House; I can appreciate the unhappiness. However, I remind the House, the people of Australia and, most particularly, the people of Queensland, that it will provide an assured water supply for well over 100,000 Australians plagued by years of neglect. We are aiming for a completion of this great project by 1988, if it is practicable. It would be a tremendous boost to the bicentennial celebrations if we could do that. The Burdekin Dam is a symbol of the reconstruction of the Australian economy which will occur under this Government. It is because this Government and all its members share this commitment that we were all shocked and dismayed by the demeaning and destructive comments about the dam by the Deputy Leader of the Opposition, the shadow Treasurer. He had this to say-and I am almost ashamed to read it out-- Government members-Go on, Bob; read it. Mr HAWKE —Pressed as I am, Mr Speaker, I will read it out. This is what the Deputy Leader of the Opposition had to say: I wouldn't have regarded the Burdekin Dam as any more sacrosanct than other areas. He went on: I'd have put it into a hotchpotch with some other things. The last thing that the people of Queensland need is for a cloud to be cast over this great national development project. With a Federal Budget of over $50 billion, why has the Deputy Leader of the Opposition singled out the Burdekin Dam as the one project to be consigned to the scrap-heap? The people of north Queensland have waited for 50 years for the Burdekin Dam. Is that not long enough for the Deputy Leader of the Opposition? Does he expect them to wait for another 50 years? This House is entitled to ask why the Deputy Leader of the Opposition-I suppose he is speaking on behalf of the Opposition Leader; he would not be allowed to say that without the authority of the Opposition Leader-is pursuing this vendetta. The Liberal Party's anti-north Queensland antics are simply incomprehensible. These dam busters are ignoring the lessons of history-the absolute necessity for coherent, robust policies for the development of our huge natural resources. I suggest to the Deputy Leader of the Opposition and to the Leader of the Opposition, because they must be speaking with the same voice on this matter, I imagine, that they do what I did, that is, visit the site of the Burdekin Dam and see for themselves this great developmental project, this historic example of Australians coming together to build a better future. Mr HOWARD —I address a question to the Treasurer. I refer the honourable gentleman to a section of the prices and incomes accord with the Australian trade union movement which reads: . . . the Government will endeavour to reduce the relative incidence of indirect taxation because of its regressive and inflationary nature. How does the honourable gentleman reconcile this statement with remarks he made last week to the effect that the regressive label attached to all indirect taxes had been oversimplified and had limited the Australian Labor Party's view of this form of taxation, and that a full examination of the regressive versus progressive tax argument could lead to a different view being taken on the traditional labels? That is a view, incidentally, with which I totally agree. How does the honourable gentleman reconcile the statement in the accord with the remarks attributed to him? Does it mean that the Government's attitude towards direct versus indirect tax has undergone a significant change over the past few months? Mr KEATING —The first point I should like to make is that the Australian Council of Trade Unions welcomes the Budget in broad, overall terms, including the increases in indirect taxation. Referring more generally to the question of indirect taxes, the Government chose in the Budget to change the basis of the anomalies in the indirect tax base in respect of excises and, as I indicated, increased in a discretionary sense at least one tax; that was the increased tax on petrol of 1 1/2c. The increase in respect of the crude oil levy due to the increased raisings out of Bass Strait was not the consequence of any change in rate but, rather, uplift. Were it not for the fact that the Government included in the Budget a contingent measure to deal with underlifting, the revenue assumptions could quite easily have been mere assumptions. What the Deputy Leader of the Opposition implies in his question is that the Government can do nothing about the indirect excise base. I reject that absolutely. In the Budget the Government stayed away from the easy option of indirect taxes which we saw the Government to which the honourable member belonged resort to in the middle 1970s when, despite prognostications to the contrary, indexation was holding together. The Fraser Government found it easy to resort to the soft tax option of the crude oil levy. There was a rapid increase in the oil price from $2-odd a barrel to the world price overnight. The Fraser Government resorted to the curious policy of financing supposedly anti- inflationary Budgets with inflationary taxes and charges. That was very much a hallmark of the revenue policies of that Government. Of course what it did finally was destroy indexation. It then tried the so-called market-place basis of wage determination which the Deputy Leader of the Opposition prefers and which, amongst other things, has got us into the position in which we are in terms of inflation today. In general terms, the Government stayed away from discretionary measures in excises. Indeed, the increases on tobacco, beer and other commodities were essentially the result of the indexation procedure rather than the express result of a decision, for instance, to increase the price of cigarettes, which is an option available to the Government. Seeing that some States had increased the excise on cigarettes in recent times, we deliberately stayed away from that. I reject the proposition, which I think is implied in the question, that in some way the movement of the excise base, the removal of anomalies and the discretionary increase in petrol prices were a turning away from the general policy we have fostered. In that respect we have the accord very much in mind. As to the other element of the honourable member's question in respect of the neutrality or otherwise of indirect taxation, there have been a number of publications in recent years in respect of some indirect taxes, particularly from the Organisation for Economic Co-operation and Development, which imply that at the worst some of these taxes are neutral. Last week the Prime Minister and I indicated that the tax base will be under review throughout this year. Those considerations will weigh upon the Government and we will, of course, be making our own judgments about those claims. MR HOLLIS —Has the Minister for Defence seen reported statements in the Nowra newspapers by the Mayor of the City of Shoalhaven and by the former member for Macarthur about the future of HMAS Albatross? Can the Minister give the House any assurances that in the Government's reassessment of its defence priorities the livelihood of the people of Shoalhaven, who have for many years depended on the Service population in the district, will be protected? Mr SCHOLES —I am aware of the statements which have been made in the area and I am at a loss to know why they were made because I cannot understand why local government or people prominent in the local community would wish to create uncertainty and depress local property values, especially for people who may be leaving the area. Like most areas, Nowra has economic problems which are general throughout the community. The honourable member will also be aware, as he was present at the meeting, that during my visit to HMAS Albatross I met with officials of local councils and gave them an absolute assurance that the levels of activity at HMAS Albatross would remain as they were at the time of the announcement relating to fixed wing aircraft. I am able to inform the House that as a first step in maintaining those levels the Government will be transferring the Australian Army's Parachute Training School to HMAS Albatross in 1985. At present the school is at the Royal Australian Air Force base at Williamtown and its relocation has been planned as part of the development of Williamtown to accommodate the RAAF's new FA18 aircraft program. Nowra is a suitable location for the types of activities carried out by the school, and moving it will assist in maintaining the Defence Force population in that area. The new training facilities for the school, which has a peak staff and student load of approximately 160, being 70 permanent staff and approximately 700 graduates per year, will be around $5m. In order to carry out the Government's undertaking consideration is currently being given to other defence activities which can be transferred to Nowra at times of any reduction in the current military personnel. I am somewhat surprised that without any justifiable reason a campaign such as that suggested by the honourable senator has been conducted in the area. I assure the people of that area that the honourable member for Macarthur has been diligent in ensuring that the undertakings that were given by me on behalf of the Government are and will continue to be carried out. Mr PEACOCK —My question is directed to the Prime Minister. I refer him to the recent opinion of the Attorney-General regarding the former Special Minister of State wherein the Attorney-General indicated that the sanctions of resignation or dismissal, traditionally regarded as applicable and appropriate for all but the most extraordinary and dangerous ministerial breaches of official secrecy, should apply to the former Special Minister of State. In that light I ask the Prime Minister whether he agrees with the Premier of Victoria that if the price of requiring high standards of ministerial conduct is 'some dissension for a time in the party then I am prepared to pay that price. But I am not prepared to compromise or in any way diminish the standards that should be set in government '. Secondly, does he also agree with Mr Cain's view that a Minister who breached ministerial propriety should not return to the Ministry, despite his long contribution to the Australian Labor Party? Mr HAWKE —In respect of the first part of the question, I agree with the statement of Mr Cain, and nothing that has happened in respect of the honourable member for Port Adelaide is in any way in contradiction of my agreement with that statement. What the Leader of the Opposition seems to have difficulty in coming to grips with is the fact that the honourable member for Port Adelaide is no longer a Minister in this Ministry. Mr Peacock —You are keeping his seat warm. Mr HAWKE —He has tendered his resignation and I accepted it, and the Leader of the Opposition has no evidence at all about a seat being kept warm. Like so many of the pathetic blatherings from the other side, the noise is not complemented by substantiable facts. The fact is that the honourable member tendered his resignation, and it has been accepted. In respect of the second part of the question, as is increasingly often the case with the Leader of the Opposition, again he is tangled up with mistaken propositions. The Premier of Victoria has not said that Mr Landeryou will never return to the Ministry. There has been no such statement; nor could there be any such statement. In respect of the honourable member for Port Adelaide, I repeat what I said the week before last, that the resignation was tendered; it was accepted. The circumstances surrounding it are being considered by the Royal Commission on Australia's Security and Intelligence Agencies. At all times since the appointment of that Royal Commission, as a government we have acted, as distinct from honourable members on the other side of the House, in a way which is consistent with the integrity of the Royal Commission. We have not sought outside the Commission to canvass the issues which are being considered in the Commission and which are a matter of determination by the Royal Commissioner. We have, at all points, followed that course. That is what is happening here. The situation involving the honourable member for Port Adelaide is before the Royal Commission. It has been considered appropriate that no action be taken in regard to an additional appointment until such time as the Royal Commissioner has recommended. Honourable members are whistling in the dark with regard to the honourable member for Port Adelaide because the facts are that he recognised in the circumstances that he should tender his resignation. He did so; it was accepted; he is not a Minister. There is not one piece of evidence available to honourable members opposite, however much they bray and carry on, that the honourable member's ministerial seat is being kept warm for him. Mr LEO McLEAY —I draw the attention of the Minister for Immigration and Ethnic Affairs to an article appearing in the Sydney Morning Herald this morning regarding immigration to Australia from Lebanon. Is it true that the rejection rate for migration and visitor applications from the Lebanon is unduly high? What is the Government's response to the present resurgence of civil strife and military activity in the Lebanon in regard to migration of Lebanese nationals to Australia? Mr WEST —The visitor visa acceptance rate for the Lebanon is 84 per cent and the migration acceptance rate for 1982-83 is 11 per cent, or 648 sponsored permanent residents. It is true that this is a slightly lower figure than Australia's acceptance rate on a world wide basis. Honourable members would be aware of the current surge in civil strife and military activity in the Lebanon. This week I have examined whether special measures are required in respect of migration from the Lebanon. In July 1982 the former Government introduced measures to expedite family reunion cases and to extend visitor visas to Lebanese who were in Australia. Those measures were withdrawn in December 1982. Today this Government has decided on the following actions: To re-activate the expedition of family reunions from the Lebanon; to waive the two year permanent resident requirement for new sponsorships-that is, sponsorships by close relatives from within Australia-and to give special consideration to family reunion cases which fail the economic-social assessment scale by which prospective migrants are assessed. That means that any people who are unduly affected by the fighting in the Lebanon will be given special consideration if they are sponsored and they do not get through the socio-economic assessment. We will extend the visitor visas of Lebanese who are currently in Australia until 31 October this year and then I will review the situation. Finally, no Lebanese national who is currently in Australia will be deported, either as a prohibited immigrant or under our criminal deportation policy until we are in a position to review the situation in the Lebanon. This is a measured response to a critical situation in the Lebanon having regard to the up to 80,000 Lebanese permanent residents already in Australia. I should mention that under the United Nations definition of a refugee, we cannot designate people in the Lebanon as United Nations-type refugees. They are victims of a civil war inside their own country. The measures that we have introduced today should ameliorate the situation for concerned relatives and visitors in Australia. Mr SPEAKER —I present, pursuant to statute, the report of the Auditor-General dated 5 September 1983 on audits, examinations and inspections carried out under the provisions of the Audit Act and other Acts, completed as at 30 June 1983. Motion (by Mr Lionel Bowen)-by leave-agreed to: (1) That this House, in accordance with the provisions of the Parliamentary Papers Act 1908, authorises the publication of the report of the Auditor-General upon audits, examinations and inspections under the audit and other Acts - September 1983. (2) That the paper be printed. Mr HAYDEN(Oxley-Minister for Foreign Affairs) —For the information of honourable members, I present the annual report of the Department of Foreign Affairs for 1982. Mr DAWKINS(Fremantle-Minister for Finance) —For the information of honourable members, I present statements on monthly issues from the Advance to the Minister for Finance for the period May to July 1983. Discussion of Matter of Public Importance Mr SPEAKER —I have received a letter from the honourable member for Mackellar ( Mr Carlton) proposing that a definite matter of public importance be submitted to the House for discussion, namely: The continuing attacks by the Government on the aged citizens of the Australian community, causing them alarm, distress and hardship. I call upon those members who approve of the proposed discussion to rise in their places. More than the number of members required by the Standing Orders having risen in their places- Mr CARLTON(Mackellar)(3.47) —Mr Speaker, as you have said, the matter of public importance being raised today by the Opposition is: The continuing attacks by the Government on the aged citizens of the Australian Community, causing them alarm, distress and hardship. I did not have to look very far this morning in order to get a particular example of the distress that is being caused to the elderly in our community today. I did not look for a particularly odd example; I just picked the first letter that I happened to read this morning in the Sydney Morning Herald from a Mrs B. Marshall of The Entrance Road, Gosford. I think I should read this letter to the House. Mrs Marshall states: The Herald (August 27) said that 10 per cent of the value of a second home is to be taken as income in the new pensions assets test. I have a house let at $45 a week to good tenants of long standing. I pay $13 a week in rates and $2 insurance. Within the past two to three years I have laid out $3,500 for renewing drains and guttering, plus painting, and spent more than $400 on a new hot-water service last year. I don't know the value, but it is a fairly nice house and few houses are worth less than $40,000. Ten per cent of this is roughly $80 a week, which is to be incorrectly counted as income, and I still have to pay out $15 a week for rates and insurance, not to mention $4,000 recently paid out. I can prove every one of these figures, if required. I am not a big landlord, merely a widow who married again, and so have an extra house, but that is not the point. Actually, I have long wanted to sell, as it is such a poor proposition, but have not been able to bring myself to put the tenants out. I would think that no properties make 10 per cent net, after rates and maintenance, loss of rent, damage, etc. The only reason landlords keep them is for some prospect of capital gain. The old pensions test assumed two-thirds of rent as income, which was wildly overstated, but words fail the new one. That is not a remarkable case of an elderly person, a pensioner, who is really distressed about the proposals by the Government to re-introduce an assets test on pensions. She is not a person who is well able to rearrange assets, not a person in the early part of her life who would find these things, although distressing, nonetheless possible to overcome. But this is just one of many examples of people who are currently absolutely terrified of what will come about as a result of the Government's assets test. They also have many months to stew over this matter before the final details will be resolved and the assets test is finally introduced some time next year. The Opposition, originally when in government, eliminated the assets test on pensions for very good reasons. It was almost impossible to distinguish one case from another in an equitable way. People found it extraordinarily difficult to process the declarations by pensioners as to their assets. There was also the distressing situation where clerks in the Department of Social Security were trying to do their jobs as best they could in dealing with elderly people often approaching infirmity, and were trying to come to just decisions about the disposition of their assets. If a decision of that kind is made in all good faith by a clerk within the Department of Social Security one has to have appeal provisions to ensure that justice is done. For that reason in 1976 the Fraser Government removed the assets test on pensions. I will take another example, using figures this time, of the comparison between two couples with quite different amounts of assets who would be treated, in the one case totally unfairly by the proposed assets test of the Government. Let us take a married pensioner couple with $267,500-worth of exempt assets as defined under the Government's proposals but without any income. That couple would be entitled to a total age pension of $7,139.60 a year. In addition, they would be entitled to full fringe benefits worth, say, $20 a week. This couple is certainly asset rich by any standards. This couple with total exempt assets worth over $267,000 has a maximum pension income. Let us take a poorer couple- again I am not taking an extreme case-with total assets of $112,000 but arranged in a different way without any particular regard to trying to avoid anything. Let us say that, under these proposals, those assets generate a notional income of $5,200 per annum. That couple would lose $1,300 per annum of their pension and they would not be entitled to any fringe benefits. There we have a comparison between a couple with well over $200,000-worth of assets on a full pension and fringe benefits and another couple with assets of $112,000, subject to a loss of $1,300 per annum of their pension and no fringe benefits. Obviously people all over Australia at the moment are in fear as to what is to happen to them under this assets test. Their fear is very genuine; it is palpable. It is coming through into the electorate offices of every member in Australia. It is not something dreamed up by the Opposition; it is very real and very distressing. It is something that is happening to a segment of the population which, in many respects, is least able to alter its lifestyle and rearrange its affairs. Certainly, as those people become much older, more frail and infirm, it will represent a desperate situation for them. The test will discriminate against people who have sold their houses, for whatever reasons, and have put their money into other assets-people, for example , who are in nursing homes. The most frail members of our population-those who have sold their homes-have assets which are in place of their homes. They are in nursing homes, perhaps hoping to come out some day. Nonetheless, those people would have their pensions removed. Whereas if, by the pure chance of life, they had remained in their original homes they would not be subject to this assets test. That kind of injustice is just unbelievable in this day and age. I refer also to farmers whose own home on the farm would not be exempt from the assets test. We would have a situation where, if a farmer sold a farm and invested in unproductive assets such as jewellery, paintings, works of art or whatever, which would be exempt assets under these proposals, he or she could get the pension, whereas if he or she held on to the farm then the pension would be gone . This is a terrible attack on the elderly of Australia. It is almost unbelievable. The Opposition knows full well what some members of the Government really believe about this situation from the remarks that were made by the Minister for Foreign Affairs (Mr Hayden), then Leader of the Opposition, in March 1982, when he responded to a speech given by Sir Phillip Lynch where Sir Phillip canvassed these matters. I might say that Sir Phillip's proposals, or canvassings, were not accepted by the Government of the day. But the present Foreign Minister, then Leader of the Opposition, said: Mr Fraser must immediately clarify his Government's policy on Sir Phillip Lynch 's proposed wealth test on pensioners. As they stand Sir Phillip's comments yesterday signal the Government's determination to end means test free pensions for people over seventy, and to reintroduce a means test on assets and savings for the rest of our 1.8 million pensioners. He went on to say: It's another kick in the teeth for aged and retiring citizens, as well as half a million widows, invalids and supporting parents. Already many aged people this year are being forced to pay income tax for the first time, because rising inflation is pushing their pensions above the taxation-free threshold. Now Sir Phillip Lynch is indicating the Government wants to go a step further by cutting off pensions to tens of thousands of people. The next paragraph is very significant. Again I am quoting from what the Foreign Minister, the then Leader of the Opposition, had to say: The argument about millionaires receiving pensions is a cruel and emotive device to cover up the Government's real intentions. Mr Howard —Who was this? Mr CARLTON —This is what the present Foreign Minister, the then Leader of the Opposition, had to say in March 1982. He-- He is referring to Sir Phillip-- is using this argument to justify ripping the pension off ordinary people with modest savings they have worked for all their lives. What Sir Phillip Lynch is really proposing is a wealth test on all pensioners. One member in this House who would very much remember those remarks would be the honourable member for Lowe (Mr Maher), because those remarks were made by the then Leader of the Opposition during the course of the Lowe by-election campaign . If any member of this House owes his election at least in part to those remarks made by the then Leader of the Opposition it would be the honourable member for Lowe. It would be a good idea if he were in the House at this moment to hear what is being said on behalf of the aged people of Australia. The Prime Minister (Mr Hawke) also made a commitment during the election campaign when he said that a Labor government would 'not take money out of the pensioner's cheque'. That was the commitment of the present Prime Minister during the election campaign. What would the pensioners have expected as a result of that commitment? Would they have expected a dramatic increase in the tax on lump sum superannuation which they have got? Would they have expected, in the May statement, the income test on pensioners over 70? Would they have expected the assets test that has now been announced? Would they also have expected in the Budget no increase in the taxation threshold at the bottom end which will mean that, over the next 12 months, more pensioners will be paying tax? That was another matter that was referred to by the present Foreign Minister in his statement last year. This is an unco-ordinated set of actions on the part of the Government. It is hurtful to this elderly section of the community in a most appalling way-those people least able to deal with it. It is obviously unco-ordinated because the Government's actions cancel each other out. The tax on lump sum superannuation payments is made redundant by the assets test. The application of the income test to those over 70 is overtaken by the assets test. Where is the co- ordination in these policies? There is none. There is also an attack on our armed services. If one is compelled to retire under armed services rules and is under 55, one pays 30 per cent tax on everything. If one is one day over 55, one pays only 15 per cent tax on the first $50,000. That matter still has not been resolved. The Opposition is taking action in the Senate today. That action is designed to ensure that this matter is taken up by the Senate Standing Committee on Social Welfare. Existing retirement incomes systems will be looked at, with particular reference to any changes which may be necessary to ensure equitable and comprehensive income security for Australians of retirement age. I am informed that that action will be supported by the Australian Democrats and Senator Harradine. On re-election, the Opposition would repeal Labor's proposed assets test and superannuation legislation as part of a total, co-ordinated approach to retirement income policy. We will not stand by to see this Government create such uncertainty, hardship and distress to the elderly section of the community, those who are least able to rearrange their assets at their time of life. Dr BLEWETT(Bonython-Minister for Health)(4.02) —This rather pathetic motion rests on two issues, that is, the assets test issue and the superannuation issue . Both represent tough decisions made by this Government in order to see that the welfare resources of this community are distributed according to those most in need. While the motion itself is pathetic, one of the more tragic sights is the man who actually moved this motion. In the past, the honourable member for Mackellar (Mr Carlton) was noted for a coherent, intellectual position. He was known, of course, as one of the driest of the dries. Though I did not agree with all of the arguments that flowed from that position, nevertheless one could have a respect for that man's intellectual position and the kinds of arguments that he often advanced in this House to do the very things that the Australian Labor Party is now doing to ensure that the resources for social welfare in this society go most to those in need. But there was no sign of that at all. In fact, there has been no more discreditable passage across the floor of this House than that of the honourable member for Mackellar when he produces the sorts of arguments that he produced today. He talked about these acts of the Government terrifying old people. But who has done the most to try to produce terror amongst old people by these decisions? Witness the kinds of alarmist campaigns that this Opposition has waged on this issue? Let me say again what the honourable member for Mackellar said: 'They are going to have to stew in this for many months.' The reason why no immediate legislation is envisaged is that the Government wishes to continue a dialogue with all of the pensioner organisations to iron out the anomalies and problems in relation to this assets test. As the Minister for Social Security (Senator Grimes) has quite clearly indicated, in the months ahead, before legislation is presented to this House in November or December, his task will be to examine the various problems, some of which were raised by the honourable member for Mackellar. The honourable member for Mackellar also made a series of comparisons about some of the problems that arise in relation to an assets test and some of the difficulties and unfairnesses that occur. But those difficulties and unfairnesses pale beside the inequities of the present system, whereby those who often have considerable capital resources are able, through systems of capital gains, to avoid the incomes test entirely. One could produce a whole series of much greater inequities which the honourable member was prepared to recognise in our present system a year ago, when in government. It is much easier to produce the kinds of inequities we now face and which this asset testing is an effort to remedy, than the comparisons which, of course, can be made by the honourable member for Mackellar. But if one wants to judge which are the greater inequities , I suggest that the members of the Opposition look at some of the inequities which occur under the present system as a result of the growing avoidance of the income test because there is no assets test. Before I deal with the specific matter of the assets test, I point out that I believe that the old people in this community can have a considerable basis of confidence that these actions will result in much greater resources being distributed to those most in need amongst the aged in our community. That can be seen if one simply looks at the commitment of the past Labor Government to this matter and its achievements. We will honour and are proud of that tradition of past Labor governments which introduced and developed most of the major income security measures in this country, such as aged, invalid and single parent pensions. The values of those pensions increased most when the party now on this side of the House was in Government. Mr Hodgman —Why are you robbing them now? Dr BLEWETT —I will deal with the particular contemporary problem of the honourable member for Denison, but it is about time the Opposition judged that in the context of our past achievement. The aim of the Labor Party's social security policy is: . . . the prevention and elimination of poverty and social disadvantage through a system of benefits . . . based primarily on need. Despite the kind of hysteria that is being created in some sections of the community by some members of the Opposition we will not abandon that commitment, which is to a system of benefits based primarily on need. We are on record as stating that: To redress present inequalities social security initiatives will be co- ordinated with other government policies to redistribute income, wealth and general community resources. We have begun the process. We have had some five or six months. We have not wasted time in beginning to see that resources are distributed more according to need in this community, a process which I am convinced will, during the first term of the Hawke Government, bring considerable advantages to pensioners and beneficiaries at the lower end of the scale. Very many pensioners on modest incomes and superannuation will also benefit. I would like to remind the House, before replying to some of the ill-judged comments on this matter of public importance, of the progress made towards improving the living standards of aged persons which the previous Labor Government made when in office some 10 years ago. Let us look at what happened. This will give some indication to old people in this community as to what will happen to us as we re-order priorities in terms of need. We took the pension from a value of under 20 per cent of average weekly earnings to 24 per cent of average weekly earnings. The Fraser Government allowed that standard pension to slide back to 22 per cent. If one uses average weekly earning as a yardstick one uses a basic inflation index. Pensions in those years rose at twice the rate of inflation under Labor. So pensioners did not suffer from the effects of the world economic problems of those years. We expanded the rate of building accommodation for the aged and home care services. We introduced a range of community programs. No Labor Government attacks aged or retired people. We have not caused them hardship in the past. We have no intention of causing them distress in this Government's time. We are faced with a disastrous projected $9.6 billion deficit dropped on us by the equivocating former Treasurer who at one stage, of course, possessed a desire to make some of these decisions himself but lacked the willingness to go through with them. We had no alternative but to re-assess the planned timetable of promises made to pensioners over the years and repeated by the Prime Minister (Mr Hawke) during the last election campaign. I repeat that the promises made during the campaign remain fixed-not just because we have made them to pensioners but because our concern for social justice demands that we honour those undertakings. In the present time of constraint we looked first at those people who, on any scale of economic and social disadvantage, are the poorest-the unemployed, including the young unemployed, pensioners and beneficiaries with children. We targeted additional social security expenditure towards them. If honourable members look at the Budget, they will see that those were the priorities that emerged at that time. In recent weeks both the Minister for Social Security and I have spoken to many pensioner groups. They do not disagree with the high priority we place on bringing benefits to those most in need, particularly at this point of time the unemployed and other beneficiaries with children. Our policies towards age pensioners have been signalled on two occasions in the past six months. In May we limited the over 70s pension to pensioners whose income was less than $303 a week for a single person or $505 a week for a pensioner couple. Again, in making this decision-I think the means test is quite generous-they were given over five months' notice of a change which will not affect them until November next. In discussing the issues with these groups, I found no confusion and very little argument about the appropriateness of the decision. Married age pensioners, who have a greater likelihood than most of owning their homes, cannot be said to be in hardship if they are on incomes of $25,000 a year. The planned assets test, as honourable members will know, does not come into effect for more than a year-not until 12 months after the passage of the legislation. The changes affect only a quarter of age pensioners and some will improve their situation. For instance, those who have money invested in savings bonds or a utility loan will have only 10 per cent of that investment taken into account, while the return in real terms to the pensioner will be between 12 per cent and 15 per cent. Others who foolishly left very large sums idle in cheque accounts will profit by better financial counselling. They put their funds in such accounts in an effort to evade the incomes test. They may not draw the full pension, but a better use of their savings, lump sum superannuation or whatever, will more than compensate. Let me refer again to the assets limits. The home, car and personal possessions of a pensioner are disregarded for the assets test. No one will go into pensioners' houses to value their belongings. The first $1,500 for a single pensioner and $2,500 for a pensioner couple will be disregarded. No one will touch what might be called cash on hand or contingency money which a pensioner holds. The next significant figures are the assets pensioners can have and still collect the full rate of pension. They are $17,100 for single pensioners and $28 ,500 for a pensioner couple. Those figures are over and above all of the factors already eliminated. They correspond with the $30 and $50 a week which are allowable income under the present income test. As with the income test, the pension then reduces by $1 for every $2 until the pension cuts out at the assets level of $106,436 for a single pensioner or $177,428 for married pensioners. I suggest that very few of those pensioners are suffering hardship. I also point out that these figures are based on November 1983 pensioner rates. They will be higher in November 1984, but of course we cannot anticipate by how much. Of course pensioners are unsettled by this change. It is a matter of deep regret, as I have said already, that honourable members opposite have abused their positions by deliberately frightening our elderly people instead of explaining to them the reality of the assets test. My colleague the Minister for Social Security has, since the change, seen many groups of pensioners and listened to the anomalies and cases that they have brought forward. We have pledged in this House and in the other place that if there are forceful reasons why adjustments should be made to the assets test, they will be made. The assets test we have proposed was administered in that form by successive Liberal and Country Party Ministers until the Fraser Government eliminated the assets component in 1977. I am told that the right honourable member for New England (Mr Sinclair), when he was Minister, refused to abolish the assets test because he knew that people would be ready to exploit the system, as has increasingly occurred since 1976. He was right. It has been a major factor in our reimposing the test. Investment leeches have sprouted to exploit pensioners' savings for their own ends. Wealthy people have been encouraged to work a pension system designed for the less fortunate. We aim to put a stop to this deliberate circumvention of the pension income test which honourable members opposite allowed. They encouraged the wealthy to run away with social security money while they kept the standard pension level down. It was consistent with their actions in allowing tax cheats to run away with revenue while pay-as-you- earn taxpayers paid. Honourable members opposite, who profess righteous indignation about the changes this Government is making, should come clean about their past. How would they have cut social security expenditure? For cut it they would have. In particular, I say to the honourable member for Mackellar (Mr Carlton), that we would like very much to know what other cuts they would have made in the circumstances we now face. What ways of obtaining additional revenue would they have chosen? Would they have imposed a capital gains tax? Would they have brought back death duties? Would they have abolished the dependent spouse rebate ? These are the policies of significant pensioner organisations. I suggest that some honourable members opposite, who talk so much about pensioners, should simply read some of the representations made by organisations about the issues I have just raised, and give this House and this nation some indication of what response they would have made to the economic situation to which their policies have led us. If the Opposition would not do any of these things, how would it finance higher pensions? We have made our policies clear. We are directing scarce resources to the unquestionably needy. In the next year and in the years after that we will have additional revenues as a result of those additional resources which will go towards increasing pensions and benefits, as we have promised. A pension of 25 per cent of average weekly earnings will, under us, become a reality. Mr WILSON(Sturt)(4.17) —I support the speech made by my colleague the honourable member for Mackellar (Mr Carlton) in bringing to the attention of this House our concern at the continuing attacks by the Australian Labor Party Government on aged citizens of the Australian community, causing them alarm, distress and hardship. It is nonsense for the Minister for Health (Dr Blewett), to suggest that members of the Opposition have caused the distress and alarm amongst the aged community of Australia. The distress has arisen out of two announcements in principle by the Labor Government, one in the mini-Budget and the other in the Budget a few days ago. I want to speak about the Government's decision to impose an assets test. It is my view that every Australian aged 65 and over should be entitled to a basic pension without an income test and without an assets test. In fact, if the honourable member recalls the last few sentences in his speech, he said that he wanted every Australian to benefit from a superannuation scheme whereby a basic 25 per cent of average weekly earnings was available to everyone. It seems to me to be a very strange way of implementing that promise, to try to squeeze the proportion of the aged population of Australia receiving a pension entitlement- between 85 per cent and 90 per cent-down to 70 per cent or less to save revenue. It is strange that on the one hand the Government is advocating a universal national superannuation scheme-pensions available to every Australian as a right -and on the ther hand is seeking to take away from Australian pensioners and those who will become pensioners in the years ahead the right that many Australians properly regard themselves as having earned by paying taxes during their earning years. It is very strange that the imposition of an assets test should be brought in at this time, because the evidence is quite clear that assets tests and income tests distort people's normal saving and investment patterns and cause a change in their behaviour, to enable them to maximise their position. It is my strong belief that all people, including those approaching retirement and those who have retired, will do better for themselves and, in doing better for themselves, will do better for the Australian nation if they invest and save according to sensible criteria. But income tests and assets tests distort those normal responses to people's saving habits. As a result of the imposition of an assets test people will further change their patterns. I wonder whether the Government will save the sort of money that it thinks it will save at the expense of the elderly and the frail in our community. I venture to suggest that the percentage take-up rate will vary little over the time ahead as a consequence of the reimposition of the assets test. But the cost burden will be even greater because more and more people will become increasingly dependent upon government and put pressure on governments, through the public sector, to pay higher and higher pensions to a higher and higher proportion of the aged population. A smaller proportion of the population will be encouraged to be self-reliant. That is what we should be doing-encouraging individual self-reliance over and above a basic and adequate minimum pension paid to all. The introduction of a means test is a backward step. It is interesting to note the history of the assets test as it applies particularly to those over 70. There was a time when the assets-income test withdrew the pension at the rate of 100c in the dollar. Is the Labor Party going back to that? It nearly has; it is not far from it. The tapered means test was introduced by a Liberal government. That set the maximum withdrawal rate of pensions at 50c in the dollar. Then came the Whitlam Government, which, with a great fanfare of trumpets, said that it was going to abolish the means test. But like the Hawke Government and its promises, it failed to deliver. It did abolish the means test for the very old and made a pension available to everyone by virtue of age. But it said: 'As we have abolished the means test we must make pensions taxable because one day all pensions will be paid free of means test'. So they were made taxable and the Whitlam Government then broke its promise; it failed to abolish the means test, so that those who were receiving pensions subject to a means test were not only means tested but also taxed. In the Labor Party's Budget there was not a word to show that, because pensions are now subject to an assets test and to an income test which has been reimposed for the over-70s, pensions are going to be paid free of tax. Oh, no, not a word of it! Senior people in our community are paying the most punitive tax rates in the land. They lose 50c for every dollar of income by virtue of the means or income test, and they lose another 15c in the dollar as a consequence of the impact of personal income tax at the standard rate. When the Minister for Health , who has taken part in this debate, introduces his Medicare arrangements and the withdrawal rate taper is put on top of the means test taper and the tax liability of pensioners with modest incomes, I wonder what the marginal rate of tax, the real rate of tax, imposed upon pensioners will be? The Labor Government in this Budget has substantially increased the tax burden on pensioners. It has frightened many because, as my colleague has pointed out, large numbers of wage earners have saved through their working years to provide for themselves. They did not want a caravan-they knew that their wives, if widowed, could not manhandle or 'womanhandle', a caravan-so they bought a small beach house or holiday house which now, because of inflation, is worth $30,000 or $40,000. They receive no rent from it but now they will be penalised; they will lose their pensions. These people are greatly worried. I had brought to me the case of a migrant whose parents also migrated to Australia. They are in the category of the old old-90 years of age or something of that order. The son built a house for his parents. He owns the house; yet now, under the assets test proposed, that will be counted as an asset against him. Is it expected by the Labor Government that that son should charge his parents 10 per cent of the value of that property to maintain his retirement income? Surely not! What should happen is not the reimposition of an assets test but the abolition of the income test so that we can move to a situation in which every Australian, on reaching the age of 65, is entitled to a retirement pension. Then if there are people in special need we should focus attention on small categories of need whilst encouraging the great bulk of the Australian community to provide for themselves over and above that basic guaranteed minimum retirement pension that should be provided to them through the taxpayer. One of the mistakes we often make when we examine the cost of social security is that we look at it in static terms. We forget that the taxes paid over the last ten years to pay for age pensions were paid by people who are today retired . They are entitled to reap the benefits now, in their retirement, of the effort they put into providing pensions for at least 85 per cent and in some instances 95 per cent. The Government's action in the Budget is a retrograde step. It is a vicious attack on the senior citizens of this country. It is an attack on those who are approaching retirement and who, because of Labor's approach to superannuation payments, to the pension for the over-70s and to the reimposition of the assets test, will now be totally discouraged from making provision for themselves at the very time when we should be encouraging more and more people to be self-reliant. Mr DEPUTY SPEAKER(Hon. Les Johnson) —Order! The honourable member's time has expired. Mr HAND(Melbourne)(4.27) —I support the Government's opposition to this feeble attempt by the Opposition to bring to the attention of the community what the Government is supposed to be doing to the old people of this country. The two Opposition speakers probably have the worst records of any of the former Ministers in relation to their former portfolios. The proposer of the matter of public importance, the honourable member for Mackellar (Mr Carlton), was the person who set about to cut back the health care made available under various schemes to the pensioners of this country. The second opposition speaker, the honourable member for Bonython (Mr Wilson), when he was Minister for Aboriginal Affairs, showed just how the then Government cared about that oppressed group in our community. The Opposition has a history of oppression of and attacks on the weakest people in the community. It has attacked the unemployed and the Aborigines. It has attacked and cut back services for aged people. Now one of its spokesmen on the front bench, the honourable member for Denison (Mr Hodgman) , regularly attacks in the House another weak group in our community, the people least able to defend themselves-the ethnic communities. Members opposite are full of hypocrisy. In the House they bleat, cry crocodile tears and try to score cheap political points to try to convince people. What they are really doing is creating fear. They are the ones who create fear. They are the ones who are misleading and causing concern amongst the people least able to understand some of these things-the elderly of this country. Mr Hodgman —You are robbing the grandmothers of Australia. Shame on you! You socialist! Mr HAND —The people in my electorate, in the inner suburbs of Melbourne, those people on lower incomes who worked and are now aged, suffered the effects of the decisions of the honourable member's Government. Mr Hodgman —Granny robber! Why don't you pick on someone your own age? Mr DEPUTY SPEAKER(Hon. Les Johnson) —Order! The honourable member for Denison in the course of this debate has made a number of interjections. I think he has had more than a fair go. I ask him now to interject no further. Mr HAND —This Government intends to take a number of initiatives. In the recent Budget it announced some of them. It will introduce a spouse carers allowance to be paid to a male who provides care and attention to an age, invalid and repatriation pensioner spouse where care is needed because of the spouse's physical and mental disability. A new hostel care subsidy of $10 per week will be introduced in January 1984. There will be an increase in the personal care subsidy from $30 to $40 per week from January 1984 for those hostel residents who need assistance in the performance of daily living tasks. Pensioners will receive indexation increases from November 1983. The new rate will be $83.90 a week for single pensioners and $143.20 a week for pensioner couples. Fringe benefit limits will be indexed from November 1983. This will ensure that pensioners' concession rights are maintained. These are hardly the acts of a government that is trying to create hardship for the aged people of this country . Let us consider what the previous Government did. Whilst we are not able to meet our commitment to raise pensions to 25 per cent of average weekly earnings in this Budget, we remain firmly committed to that objective. I take honourable members back to the famous policy speech of the former leader of the Liberal Party, Mr Malcolm Fraser, in 1975 when he said: The real value of pensions will be preserved. When Labor left office pensions were at 24.5 per cent of the average weekly earnings. I will take honourable members back a little to the time when Malcolm Fraser, who was probably the greatest manipulator of the truth that this country has ever seen, and his Government left office. In 1978-79 the September quarter rate was 24.5 per cent; in 1979-80, 23.4 per cent; in 1980-81, 23.7 per cent; in 1981-82, 22.3 per cent; and in 1982-83, when the Fraser Government was thrown out, it was 22.2 per cent. Who are the people who have attacked the living standards of the aged people in this country? They are certainly not members of the current Government. We would be the first to admit that everything is not a bed of roses for the aged people but, by hell, things will be a lot better and are already a lot better under this Government than they were in the eight years of the previous Government. The Fraser Government was not content with attacking people's wage or income levels. It attacked other areas such as housing. In the last Budget of the Fraser Government, of which the honourable member for Mackellar (Mr Carlton), who is sitting at the table was a Minister, allocated 40 per cent less in real terms than Labor had allocated in 1975 for pensioner or aged persons' housing. Not content with the extent of the onslaught, the final act of the Fraser Government -the cruellest blow and the one for which I emphasise the honourable member for Mackellar was responsible-was to take away from elderly Australians their access to adequate health care. It is not just a question, as some have sought to suggest, of the Government singling out the aged in this process. In the ordering of priorities the question of pensions was assessed and action has been initiated. We have sought to bring about equity in the taxation system and that process will continue. I hope that this year when the relevant legislation goes to the Senate honourable members opposite, through their colleagues in that place, will not protect those manipulators of the tax system, those tax avoiders, those bottom-of-the-harbour promoters and prevent taxation revenue coming back to the Australian community and, in turn, being used for the benefit of aged people. The kind of measures announced in the Budget to which I alluded earlier in respect of increased services and facilities for pensioners can be provided only if we are rigorous in making sure that pensions go only to those in need and not to the richer people in the community and the tax avoiders. Every dollar which is paid out in benefit to people who could easily support themselves is a dollar less for more hospital wards for the aged, a dollar which could be used for modern medical equipment to service the aged and a dollar less for trained staff to help deal with pensioners' problems. These are the dollars that we cannot afford to squander on those not in need. I turn to the support for our position. The Australian Council of Social Service, a body respected throughout this country, issued a Press release headed 'Assist the Needy Not the Rich' on 4 March 1982. The first paragraph states: The Australian Council of Social Service supports the use of a means/asset test for old age pensions. Even with the increased welfare expenditure these needs cannot be realistically met while universal payments are made to the rich. In that comment the Council was referring to the way in which the previous Government had been dealing out pensions. I wish to quote also a person whom the honourable member who presented this matter of public importance would, I think, still support. Senator Chaney I think is still the Leader of the Opposition in the other place! He is reported in an article by Michelle Grattan in the Melbourne Age of 27 August 1983 as having stated: I think we cannot escape the fact that there are some genuinely needy pensioners in the country who do not receive enough help, while some other people, by the advantageous arrangement of their assets, are able to draw on the system to a greater extent than their real degree of need would seem to justify. I refer in conclusion to a critique prepared by the Australian Pensioners' Federation on the proposals introduced in the Budget as they affect pensioners. I wish to mention a couple of points. The pensioners say on page 2 of the critique that they would like to see the introduction of a wealth tax, the introduction of death and gift duties and the introduction of capital gains taxes. They say in conclusion on page 8: The Australian Pensioners' Federation seeks to represent the views of those pensioners who clearly deserve the pension and who have suffered considerably over the last eight years as prices have outstripped the pension rises and public health and welfare services have suffered cut-backs. That refers to the cutbacks of the former Government. Surely that is what the legislation being proposed by the Labor Government is all about. It is to cut into the income of those people who manipulate the system, to strip them of some of their wealth, but in no way to attempt to harm those people who need our assistance and the assistance of the Government. Mr DEPUTY SPEAKER(Hon. Les Johnson) —The discussion is concluded. Motion (by Mr Peter Morris)-by leave-agreed to: That, in accordance with the provisions of the Parliamentary Contributory Superannuation Act 1948, Mr Moore be appointed a trustee to serve on the Parliamentary Retiring Allowances Trust. Report Mr MORRISON(St George) —by leave-Mr Speaker, I present the official report of the Australian Parliamentary Delegation to Indonesia and seek leave to make a short statement in connection with the report. Leave granted. Mr MORRISON —I suspect that all of us as members of Parliament have at one time or another been placed in what might be described as a no-win situation. Anyone following the events associated with the visit to Indonesia of the Australian Parliamentary Delegation would have been struck by the immaculate timing of alleged exposes of Indonesian activities in East Timor. There certainly has been a determined and seemingly concerted effort to undermine the credibility of the Delegation before it left Australia, whilst it was in Indonesia and when it returned. Lest I be accused of paranoia, let me rehearse the main features of the campaign. The line of attack has ranged from charges that the Indonesians would veto the membership of the Delegation and would decide where the Delegation would be allowed to go, to such other matters as the inadequacy of time in East Timor and censored interpretation. I wish to make it clear that the composition of the Delegation was decided by this Parliament. At no time did the Indonesian authorities raise any objection to the membership of the Delegation. The decision as to the main places visited was made by the Delegation. Honourable members may recall that Mr Whitlam's report on his visit to East Timor was criticised because he had not visited areas considered significant by Fretilin supporters in Australia. So before departure for Indonesia I asked a supporter of the Fretilin position for a list of villages that he thought the Delegation should visit. My colleague the honourable member for Fraser (Mr Fry) gave me a list of nine villages. The Delegation visited all of those villages with the exception of one village, Lackluta, the circumstances of which are explained in the report. As the report notes, the selection of the villages could have been regarded as provocative. At no stage did the Indonesians demur and, as promised both by President Suharto and Governor Carrascalao, the Delegation not only went wherever it wanted to go but also was provided with the facilities and the transport to do so. I come now to the question of time. The amount of time spent in East Timor was a matter of concern to the Delegation. The original Indonesian proposal was not considered satisfactory by the Delegation and following further discussion after the Delegation arrived in Jakarta the period spent in East Timor was extended. The end result was that the Delegation arrived in East Timor on Wednesday 27 July and departed on Monday 1 August. There is little doubt that whatever length of time the Delegation spent in East Timor it would have been criticised by some authorities and some sources as being insufficient. What has to be kept in mind is that any visit, without the access to air and land transport made available by the Indonesian authorities, could take weeks to cover the same ground as the Delegation was able to cover. Publicity has also been given to the alleged inadequacies of the interpreters to the Delegation which, because of the ready acceptance of those charges in some quarters, calls for a comment. Before taking up those charges I refer honourable members to the section of the report dealing with interpreters. It will be noted that the Delegation had the services of an Indonesian speaking officer from our own Department of Foreign Affairs. The Portugese and Tetum- Tetum is a local language-interpreters were selected by the Delegation. In fact, the principal interpreter was chosen by Senator McIntosh. Neither of the local interpreters were employees of Indonesian authorities and the Delegation used its own funds for a payment to the interpreters. I now want to turn to the particular charges made in an Australian Broadcasting Corporation program Background Briefing presented on Sunday 14 August. The thrust of the ABC program fully accords with what I have been saying about deliberate efforts to undermine the credibility of the Delegation. The reporter made his intended point very clear. He said: It is the question of translation which could well place the findings of the delegation under a cloud. The reporter questioned 'the integrity of the translators present at the meeting between Mr Morrison and the Fretilin guerrillas' and accused the interpreters of manipulating the conversation and providing 'deceitful translations'. Although the question of translation was the centre-piece of the program I cannot recall the reporter questioning me on the subject and certainly nothing was taken to air. As I am the person directly involved in the situation, this is a curious omission. Nor was there any attempt to ascertain the peculiar circumstances of that meeting. It was, in the first place, a chance meeting and in the circumstances, which are described in the report, I was not accompanied by the interpreters selected by the Delegation. The arrangements for interpretation on this occasion were makeshift with Mr Jimenez, a member of the provincial Government, reluctantly filling in at my request. I also draw the attention of honourable members to the comments made by the interpreter who checked the tapes of the Delegation when it returned to Australia. This is included in the report. Mr Repper, who was a translator recommended to us by the Department of Immigration and Ethnic Affairs, pointed out that the Fretilin spokesman had a very poor command of Portuguese, that he showed a lack of coherence and that 'many of his sentences made no sense'. The inference mischievously drawn by the ABC from this single episode seeking to discredit all the findings of the delegation therefore does not hold. Moreover, the main thrust of what the Fretilin spokesman sought to convey to me was translated. I also had handed to me the letter in which these points were amplified. My efforts to get the name of the translator used by the ABC to discuss some aspects of the translation were fruitless. The Acting General Manager of the ABC, Mr Mackriell, denied my request. At this stage I seek the leave of the House to incorporate in Hansard a Press release I issued as the Leader of the Delegation. Leave granted. The document read as follows- PRESS RELEASE Australian Parliamentary Delegation to Indonesia The media has pursued with interest one aspect of the activities of the Australian Delegation concerning the interpretation at the chance meeting between the Leader of the Delegation Mr Morrison and four armed members of Fretilin. The facts are: 1. At the chance meeting with the Fretilin Group the interpreters selected by the Delegation were not travelling in cars 4 and 5 which stopped. 2. The Portuguese translation was done by Mr Jimenez, a representative of the Provincial Government who reluctantly filled in as interpreter at Mr Morrison's request. He was the only Portuguese speaker present. The translation from Indonesian to English was checked by Mr John Holloway of the Department of Foreign Affairs, the Delegation's Indonesian interpreter. 3. According to the translator recommended by the Department of Immigration and Ethnic Affairs who checked the tapes in Australia, the standard of Portuguese used by the Fretilin spokesman was poor and difficult to follow. 4. In the initial stages of the discussions with Fretilin which were marked by some confusion as each party measured the other up, the references in Portuguese to the name of the village of Salari and the description of that village as according to one translation a ''concentration camp'' and according to another version as a ''village of concentrated settlement'' did not come to Mr Morrison in the English translation. 5. As the literal translation done after the event and with the benefit of playing the tape several times now stands there is clearly an inconsistency in the statement of the Fretilin spokesman: (a) he invited Mr Morrison to go to Salari to meet other members of his group (b) the village of Salari was ''a concentration camp set up by those of Java''. If the translation had come through literally Mr Morrison would certainly have sought to clarify the inherent inconsistency in the two statements. 6. The ABC Radio's Background Briefing program on Sunday 21 August sought to discredit the Delegation's work in East Timor, by inferring from the omitted parts of the literal translation that all the translations of conversations held by the Delegation in East Timor were suspect. As pointed out, in the unusual circumstances of the chance visit the two interpreters used by the Delegation throughout East Timor were not present at the Fretilin meeting. The inference drawn by the ABC Program therefore does not hold. 7. Mr Morrison does not accept that the translation on this occasion was deliberately distorted or censored. He rejects completely the assertions in the program that the translation was ''deceitful''. The main points that the Fretilin spokesman wanted to make about the position of Fretilin were conveyed in English to Mr Morrison and are a matter of record. The letter handed to Mr Morrison repeated most of the points raised by the Fretilin spokesman. 8. In an effort to discuss the translation used by the ABC Talks Department with the translator, Mr Morrison sent a telegram to the Acting General Manager of the ABC, Mr Mackriell asking for the interpreter's name and address. Mr Mackriell advised Mr Morrison on 16 August that the ABC was ''unwilling to disclose at this stage the information you have requested''. Mr Morrison said that it was curious that in a technical matter such as translation the ABC had taken refuge in anonymity. He regretted the lack of cooperation from the ABC. 9. Mr Morrison said that he had recorded on 15 August an interview for another ABC Program, ''PM'', which was critical of the presentation of the Background Briefing program. This interview had not gone to air. Mr MORRISON —At this stage I want to take up the unusual circumstances in which a document described as a dissenting report is attached to an agreed report. Many of these points are dealt with in the letter of transmission which is contained in the report. The document signed by Senator McIntosh relies for much of its argumentation on alleged quotations from the report. The sentences he quoted are demonstrably not in the agreed report. It is almost as though the writer of the document had not been present at the meetings of the delegation. The status of the document as a dissenting report is, therefore, open to question. Whatever the document is dissenting from, in the examples cited-these are contained in the letter of transmission-it is not dissenting from the agreed report. Senator McIntosh has admitted to me that he attended a meeting of some of his parliamentary colleagues on Sunday 21 August at which the visit to East Timor had been discussed. It was on the very next day-Monday-that he advised me of his intention to add a couple of pages, as he put it, to the report he had agreed to on the previous Thursday. Senator McIntosh has been reported as claiming that he was under pressure. I believe I can say on behalf of the Delegation that that pressure did not come from his colleagues on the Delegation . I want now to turn to the main findings of the Delegation and these are recorded at length in the Delegation's report. The first finding is that the Goverment in East Timor appeared to be in effective control of all settled areas . As we have noted, the Delegation was invited to go anywhere in East Timor it wished to go, and it did so. In all the villages visited by the Delegation-I emphasise again that the Delegation visited the villages proposed by my colleague, the honourable member for Fraser-the provincial administration was fully in place. It seems there is a widespread misconception in Australia that Fretilin occupies and administers a large part of East Timor. For instance, the Chairman of the International Affairs Commission of the Australian Council of Churches, Mr Ian Williams, in a telegram sent to me urged that the Delegation accept the invitation of the Fretilin representatives-presumably those in Australia at the time-to visit Fretilin areas in East Timor. As such, it was an empty invitation. I think that if honourable members look at the areas covered by the Delegation-maps are contained in the report-they will see that we criss- crossed East Timor north, south, east and west. There are undoubtedly Fretilin camps in the rugged terrain of East Timor but that would appear to be the extent of Fretilin's territorial control. I now turn to the security situation. The Delegation's findings on the security situation in East Timor are recorded in chapter 8 of the report. From early this year and since the talks between the Government and Fretilin in March, and up to and including the visit of the Delegation, no military encounters have taken place. Certainly at the time of its visit, the delegation found that the security situation was quiet. As noted in the report, the delegation travelled without military escort and was able to walk through all the villages visited without any security protection. With the strong support of the new Governor, Mr Carrascalao, the Indonesian authorities have opted for a hearts and minds campaign to encourage Fretilin groups to lay down their arms. Details of this campaign are described in the extensive documentation of the delegation contained in the report, particularly the conversations that the delegation had with Governor Carrascalao and the leader and the military commander in East Timor, Colonel Purwanto. I do not think that anyone knowing the resources of the Indonesians would deny that the Indonesians certainly have the resources to defeat the Fretilin groups if they so wished. It seemed to us as a delegation that they were anxious to prevent further loss of life. The difficulty for the Indonesians is that the current campaign-that is, the hearts and minds campaign-is being depicted as a sign of weakness, particularly by Fretilin supporters outside East Timor who continue to encourage the resistance movement. The impact of propaganda generated from abroad was evident to me in the discussion that I had with the Fretilin guerrillas in East Timor. During that conversation the Fretilin spokesman expressed surprise that Mr Abilio Araujo had not come with the delegation. Mr Abilio Araujo describes himself as the Minister for Foreign Affairs-I think it is-of the Fretilin Republic. He is an expatriate Fretilin who was, at the very time when we were in Indonesia, in Australia. It would seem to me that the Fretilin in East Timor had apparently been led to believe that support, in the form of Mr Araujo, was in the way, curiously enough , in company with the Australian Delegation. But the Fretilin spokesman, Mr de Sousa Gama, appeared perplexed when I told him that neither Mr Araujo nor any member of the Fretilin was with the Delegation. I also suspect that the visit of the Delegation had been portrayed as evidence of international support for Fretilin in East Timor to buoy up their expectations. The Fretilin in East Timor have become the main victims of the propaganda of overseas Fretilin supporters. They are living on false expectations. In the circumstances of the situation in Timor, it is, to my mind, a cruel deception. I want to bring the report up to date with a personal observation. Since the Delegation's visit to Indonesia there has been a report of a Fretilin attack, on 8 August, on a unit of an engineering battalion, in which 15 servicemen were killed. The relaxed conditions which have prevailed and which are described in the report are obviously now at risk, and we should ask ourselves who would benefit from a change in the prevailing conditions. It is worth recalling that, when the delegation was in Indonesia, a report emanating from Australia claimed that the Indonesians would mount what was described as a blood-bath on 17 August , the celebration of the Indonesian national day. We had the opportunity in East Timor for talks with the Fretilin. They made no reference, no mention, either in their letter or in the discussion, to any such possibility, and certainly there was no mention by the Indonesian authorities, by Colonel Purwanto, that this sort of campaign was being contemplated. It would certainly not be consistent with the hearts and minds campaign being pursued by the Indonesians. The Delegation has described the purposes of that campaign. Moreover, it is hardly in the interests of the Indonesians to initiate military operations when United Nations consideration of the question of East Timor is imminent. I do not believe that the same sorts of arguments can be applied to the position of the Fretilin buoyed up by their overseas supporters. I turn now to, I suppose, the crunch part of what flows from the Delegation's report. In that report we point out, on the basis of discussions that we had with President Suharto and other Indonesians, they they regard the 1976 act of incorporation of East Timor into the Republic of Indonesia as final and irreversible. We should also note that since 1975 Indonesia has lived with what is a critical resolution of the United Nations. At the last session of the General Assembly, the vote was maintained by a slim margin. In that vote, two- thirds of the members either voted in favour of Indonesia's position or abstained, and of importance to Indonesia is that it has the support of its partners in the Association of South East Asian Nations, Papua New Guinea, New Zealand and, since 1978, Australia. What is currently at issue is whether the Australian Government should continue with the policy of the previous Government in voting for the Indonesian position, abstaining, or voting against the Indonesian position. As the report points out, a change in Australia's vote in the United Nations would, in these circumstances, not change the fundamental situation in East Timor; but it would, detrimentally affect Australia's relations with Indonesia and significantly detract from any role that Australia could play in influencing developments in Indonesia, including in East Timor. In reaching a decision on how to vote at the United Nations, if such a vote does take place, any Australian government must face up to the realities of that situation. The report goes into a number of other issues. It is highly critical of the current civil rights, human rights, position in Indonesia. The Delegation, on a number of occasions, raised what it regarded as questionable practices of the Indonesian authorities in relation to the Press and the freedom of the Press, and we argued very strongly on a number of occasions, including at a meeting with the DPR, the Indonesian Parliament, for the resumption of Australian Press presence in Jakarta, and also to encourage Indonesian Press into Australia. We believe that there are very substantial barriers to understanding between Indonesia and Australia. Australia, from the comfort of its own position, with a non-turbulent history, and where war, civil war and revolution have not impacted upon us, has a certain outlook towards these issues. But we also believe that it is necessary to understand some of the issues that confront countries such as Indonesia-and there are many people who are very critical of the conduct of Indonesia-the conditions that have prevailed in a country which was under colonial power, which had to fight for its independence, and which went throught a bloody civil war in 1965 in which people by the tens of thousands were killed. We have to understand the differences in attitude that people from that sort of background take. In the introductory comments to the report we try to spell out these barriers to understanding and the lack of shared values which create enormous obstacles to a close relationship with Indonesia. What we sought to do was to point out that we do not have to be buddy-buddies with Indonesia and that we do not have to set ourselves up to be great friends; what we should set ourselves up to be is good neighbours. The President and the Speaker of the Indonesian Parliament quoted an Indonesian proverb which I think is very relevant to the relations between Australia and Indonesia. That proverb was that it is better to have a good neighbour than a distant relative. There is an enormous challenge both to the Indonesian side and to the Australian side in coming to terms with our neighbouring relations. I believe, and I think the Delegation's report substantiates this, that that effort is well worth making. Motion (by Mr Peter Morris)-by leave-proposed: That the House take note of the paper. Mr DOBIE(Cook)(5.02) —I am pleased to support the remarks of the leader of the Australian Parliamentary Delegation to Indonesia, the honourable member for St George (Mr Morrison), and to endorse the remarks he made in his speech. As a member of the Delegation I found the visit politically absorbing and socially interesting, yet physically somewhat gruelling. All members of the Delegation proved to be most amenable companions throughout the visit. We were accompanied by outstanding people whose efforts and dedication were a tribute to this Parliament. I refer to Mr John Holloway of the Department of Foreign Affairs, Dr June Verrier, the delegation secretary and a well known and highly respected member of our Parliamentary Library Research Service, and Mr Dennis Richardson from the Australian Embassy in Jakarta. Assistance was generously given by Ambassador Dalrymple and all his staff, and I thank them for facilitating all our endeavours and movements. Without this effort by them our visit would have been far less effective. The leader of the Delegation in the report paid tribute to our Indonesian hosts and I endorse and support this appreciation of their generosity and their personal friendliness at all times. When each member of this Parliament considers this report I trust that he or she has regard for the need for amicable relationships between Indonesia and Australia. It should be noted that the report does not contain any formal recommendations on policy. Rather, each reader of the report will have the opportunity of making an individual evaluation of the observations and findings contained in that report. However, as parliamentarians we have to understand that East Timor is a central issue in Indonesia's measurement of its relationships with our country. It is only fair to point out that the Indonesian Government regards it as a critical test of Australian-Indonesian relationships. It is worth pointing out that the Republic of Indonesia regards the act of incorporation of East Timor as final and irreversible. For my part, I believe it is totally unrealistic to postulate that this situation can be changed, short of the unlikely option of armed intervention. However, the report points out: . . . the lack of shared values will inevitably produce awkwardness and misunderstandings. A greater effort of understanding on both sides is not only worthwhile but essential. I add that it is not an awesome or difficult task. As a delegation of parliamentarians we were all concerned about human rights, including those in Indonesia. I commend chapter 5 of the report for close scrutiny by my colleagues in this House and note that while we did not visit detainees in prison, though permission was given-shortage of time stopped us-we visited Atauro Island which is the main detention centre for Fretilin sympathisers. As the report details, the local authorities were confident that all detainees would be moved back to the mainland by October 1983. Our visit to this camp is detailed in the report. There was no attempt whatsoever to prevent detainees from speaking to Delegation members or to prevent members from going anywhere they chose within the camp. The detainees approached us willingly and in large numbers to present their views and gave no impression of being cowed. However, they were detainees without legal cause, and this represents an obscenity to all of us in this Parliament. We welcome the declaration that all will be off this barren, hot island within a matter of weeks. I believe that this report should be read for what the majority report has to say to fellow parliamentarians. It shows that Indonesia is making a significant effort to improve the physical and material conditions in the province of East Timor. It was my own observation that the Indonesian authorities have shown certain sensitivities in their administration of this new province. Progress is obviously being made and tribute should be paid to the new Governor who seems to have the confidence of the East Timorese and the authorities in Jakarta. Governor Carrascalao impressed all members of the delegation, and it was pleasing to hear one Roman Catholic authority refer to him as the hope of East Timor. I also point out that the report's findings on the lack of any evidence of the Islamisation of East Timor, the source of much disquiet amongst certain of my constituents in Cook, is worth reading and should allay many fears. I wish to address some remarks to the minority report. It is true to say that the delegation was surprised to receive Senator McIntosh's dissenting report. There is of course no question about his right to issue such a report. It is, however, an unusual step for a member of an Australian parliamentary delegation to take. A good deal of hard work had gone into the preparation of the report and a good deal of compromise had been resorted to in order to obtain a consensus opinion. Many important issues such as the view of the majority of the Delegation about the status of Indonesia's sovereignty over East Timor were dropped in the interests of consensus. Senator McIntosh had been closely involved in this process to obtain consensus. The Delegation considered the contents of the report in minute detail. Senator McIntosh had indicated that he was happy with it. In these circumstances one would have hoped that the matters of substance, which presumably prompted the change of heart on Senator McIntosh' s part, would have been made crystal clear. This is anything but the case. With the dissenting report the Parliament has been presented with a collection of generalities which provide a superficial and misleading view of the Delegation's report. In writing the report the full Delegation was only too mindful of the complexities of the East Timor question and the limitations under which the delegation operated. Any fair-minded person reading the report will quickly grasp this point. The report does not, and in fact could not, attempt to provide a detailed survey and analysis of events in East Timor since the mid-1970s. The Delegation' s report records what the Delegation did, where it went and to whom it spoke. That is the purpose of such a report. I believe the majority report does this efficiently and fairly. Senator McIntosh does not question, to use his own words, the facts, figures and other information contained in the Delegation's report. Yet at the same time he complains that the report is tendentious, superficial and at times misleading in its evaluations and observations. Such criticisms are better directed at Senator McIntosh's own farrago of distortions and generalities than to the delegation's report. Senator McIntosh complained of the tendentious nature of the delegation's report and of its enticing many of its readers towards what he describes as certain conclusions. What conclusions does the Senator have in mind ? Why are they not spelt out? Why the resort to tendentiousness on his part? Senator McIntosh, in his minority report, maintains that the report contains a misleading perception of the character of support in Australia for the East Timorese, arguing that the report obscures the fact that most of the support in Australia is directed not specifically towards Fretilin but towards the East Timorese in general. This is only one of a number of criticisms of the delegation's report that do not bear close examination. Moreover, one might ask whether prominent organisations such as the Campaign for an Independent East Timor or the Australia East Timor Association offer the same support to those East Timorese who have sided with the Democratic Union of Timor and Apodeti and accepted incorporation into Indonesia as they offer to Fretilin. Further, Senator McIntosh concedes that Indonesia has made large budgetary allocations for the development of East Timor. He maintains that the delegation was unable to determine the extent to which development is benefiting the Timorese. The Delegation recorded what it saw of the development process. The Delegation, precisely because of the limitations on its visit, avoided qualitative judgments about the development process. The self-contradictory element in Senator McIntosh's approach is best shown in his comment that the Delegation avoided addressing the issue of the attitude of the Timorese to their present situation. At the same time he acknowledges that the nature of the Delegation's visit made this an impossible task. What Senator McIntosh seems to be implying is that the Delegation must admit failure in a task that was beyond its capabilities and which was not in fact the purpose of our visit. Bearing in mind Senator McIntosh's complaints about the superficiality of the Delegation's report, it is instructive to consider the tone of the honourable senator's dissenting report. Senator McIntosh used phrases such as 'tends to diminish the significance of aspects of the Timor problem', 'a rather distorted account of the historical background', 'obscures the true character of recent historical developments', 'impressions rather than soundly based assessments' and 'tendency to gloss over the circumstances'. All of these phrases beg questions or, to use Senator McIntosh's terminology, invite conclusions. We should note for the record that Senator McIntosh's document even quotes sections of the report which, mainly in deference to his objection and the wish to achieve consensus, were omitted from the draft to which he agreed. In his minority report he stated: . . . a moral issue involved in holding out false hopes and encouraging small Fretilin groups in East Timor to continue their fight when realistically the situation could not be changed short of the unlikely option of armed intervention. This represents the view of the majority of the Committee but was deleted. It raises the question: From which draft was the author of Senator McIntosh's document working? I should point out that the only time this quotation is mentioned in the whole of the printed report is in Senator McIntosh's objection. Having taken the unusual step of presenting a minority report, Senator McIntosh had a responsibility to the Parliament to spell out his position in precise, unmuddled terms. I regret that he failed that responsibility. In conclusion, I would move to the point that our visit to Indonesia was, in fact, to Indonesia, not just to East Timor. We visited West Timor, East Timor and Central Java. It was a fascinating observation of the Delegation that similar problems existed in each area. It is fair to say that the Governor of West Timor, himself a distinguished man who has worked amongst the disadvantaged of his area for his whole lifetime, was critical of the fact that he was getting less funds for West Timor than for East Timor. It is not uncommon for me to talk of regional finance in the Parliament. Mr Sinclair —Even of island States. Mr DOBIE —Island States are part of the national scene. I wish to refer to the three visits that I have made to Indonesia. In 1968 I went there when the Parliament building was not completed. There was still some doubt in those days- when barbed wire was to be seen everywhere and, tanks and what have you roamed the streets of Jakarta after the 1965 problem-whether the Parliament would survive. When I went there in 1972 there was evidence that the parliamentary system was starting to jell. When we were there this time, in 1983, it was perfectly obvious to all of us on the Delegation that the parliamentary committee system was having a profound influence on the governing process of Indonesia. Whether the Parliament of Indonesia and the Parliament of Australia are the same, whether they will ever be the same, or whether they could ever be the same are questions which none of us can answer. However, the fact remains-it was evident to us on this visit as guests of the Indonesian Government and of the Speaker of the Indonesian Parliament-that the Parliament of Indonesia has a role to play far in excess of many of the countries which will be voting against its actions in the United Nations when those questions come before it later this year. Mr CROSS(Brisbane)(5.15) —I have been asked to be brief because of the pressure of legislation today, so I do not intend to cover many of the matters that my colleagues have referred to in their speeches. I support what they have said about the factual nature of the report of the Australian Parliamentary Delegation to Indonesia. It is always an interesting experience to go on a parliamentary delegation. I have been on only one before. This Delegation, of course, was a particularly important one as we visited our near neighbour Indonesia. The Delegation was well balanced and it worked very hard. Every member made a contribution to its success and findings. In praising all members of the Delegation I particularly mention our leader, the honourable member for St George (Mr Morrison). Because of the honourable member's previous service in the diplomatic corps and in this House he was well fitted to lead a parliamentary delegation of this kind and he did it with considerable skill and aplomb. If the history of Fretilin is written at some time in the future a visiting card, exchanged on a rather dusty road, might find a place in it. The report consists of 214 pages, including many appendices and records of conversations. The actual report has 79 pages and some 20 of these are devoted to East Timor. The dissenting report is 4 1/2 pages long. During the visit we had the opportunity of meeting the President of Indonesia, President Suharto, his deputy and members of the Foreign Affairs, Information and Defence Committee of the Indonesian Parliament. It was obvious that the Indonesian Parliament regarded our Delegation as an important one. It was obvious not only from our contacts with the President, his deputy and members of the Parliament but also from the many people with whom we spoke throughout Indonesia that the people there and the Indonesian Administration place great importance on the continuing good relationship with Australia. It was also obvious-it was mentioned to us on many occasions-that there was considerable good will towards Australia, in part because of the aid which we have given Indonesia in some quite significant ways but also because of Australia's support for the Indonesian independence movement . I am sure all honourable members will recall that in 1948 and 1949 Australia joined with India in sponsoring Indonesian membership of the United Nations. There is obviously a great deal of good will towards Australia there. The honourable member for Cook (Mr Dobie) pointed out the differences in Indonesian society. We cannot expect Indonesia to be a mirror image of Australia . It has a vastly different background, a much more diverse ethnic composition and, of course, a long history of many hundreds of years of colonialism under the Portuguese, the Dutch and for a short period the Japanese before it achieved independence. Despite the differences between Australia and Indonesia, it is obvious that good relations with Indonesia are very important to this country. Because of the very nature of things, in relations with neighbours it is the areas in which we differ that are of particular concern. At present the major interest in Australia's relationship with Indonesia focuses on East Timor and, of course, that is the reason why the major part of the report deals with East Timor. It is obvious from what we saw in Indonesia that it is in effective control of the Province of East Timor and will remain in control of that Province. For Australia to bring about family reunion for people in East Timor, to assist in improving their food situation and solving some of the serious problems of health and disease involves a positive relationship with Indonesia. That is something every honourable member of this Parliament should take into account when this report is being considered. In Timor we found a relative state of peace. That is not to say that all the killing has stopped. There have been since, and will be in the future, occasions when loss of life occurs. One can only hope that the moderate policies of Governor Carrascalao will prevail and that the Indonesian military authorities will show retraint-sometimes perhaps in difficult circumstances-to build on the fragile peace which exists in East Timor. Time and again we explain to people in Indonesia that while governments may make agreements, the long term relationship and friendship between people is built on reciprocal respect and shared values. It is on this matter that we have pointed out that people in Australia and in countries like Australia will follow the development of human rights in Indonesia and in East Timor into the future. In the limited time I have chosen to take, it only remains for me to join with my colleagues in paying my tribute to the staff of the Delegation, Mr Holloway and Dr Verrier, to the support we received from the Department of Foreign Affairs, our Ambassador to Indonesia, Mr Rawdon Dalrymple, and all of his staff in Jakarta and Canberra. I believe that the report is a good investment of time and money for the taxpayers of Australia and for the people who went on that Delegation. I can only hope that all honourable members will study it carefully because it deals with a matter of extreme importance and with a relationship with our near neighbour that will remain with us for all time. Mr MacKELLAR(Warringah)(5.24) —I am very pleased to take part in this debate because it is about a relationship between Australia and our nearest South East Asian neighbour. That relationship, of course, is one of the most significant and sensitive for both of our countries. Both have to work at the relationship to ensure a creative and mutually beneficial future for it. As has been pointed out, Indonesia has always been mindful and appreciative of the role played by Australia in its struggle for independence. The wisdom of those early years was sustained in subsequent years-They were difficult years at times-by a patient and friendly diplomacy on both sides. The relationship survived the difficult issue of the future of West Irian. It survived the crisis mounted by Indonesian efforts to undermine the newly independent state of Malaysia. Honourable members will recall that under President Sukarno, Indonesia opposed the inclusion of the Borneo states of Sabah and Sarwak into the newly independent state of Malaysia. Indonesia applied a policy of military action and Australians were involved in a shocking war on behalf of Malaysia. Notwithstanding those stresses, diplomatic relations and dialogue continued with Indonesia. This indicates the fundamental strength of the relationship. The decision by Indonesia to incorporate East Timor into the Indonesian state was fraught with great difficulty. Indonesia clearly hoped for a solution which did not involve the use of force. The political situation which came to crisis in 1975 was a complex one, bedevilled as it was by the internal upheavals in Portugal. For a time there was a clear possibility of a Marxist leadership emerging in the Portuguese Army. These fears proved somewhat misplaced, but they were not seen so at the time. Portugal was in a deep state of internal crisis in 1975 and developments in Timor took off with little reference to Lisbon. Normally, the settlement of the future status of a colony would contain arrangements for a transfer of power in conditions of political stability in the metropolitan state. Unfortunately Portugal was, at that time, in political chaos. This had a local effect in Timor , which fundamentally disturbed Jakarta. East Timorese political groups engaged in armed conflict. Civil war erupted in East Timor between Fretilin, an army- based political movement and the Timorese Democratic Union-UDT-a movement supported, in the main, by businessmen and civil servants. Although the civil war between Fretilin and the UDT lasted for only five weeks or so, it was to have fundamentally disastrous effects. The weight of advantage militarily was with Fretilin, having the backing of 3,000 Timorese in the regular army. It was a civil war which claimed 1,500 or so lives. This was the first real tragedy. The second tragedy was the destruction by Fretilin of UDT, which had foolishly occupied certain installations in main towns. It was a cruel and ruthless way to deal with opposition to their exclusive bid for political power in Timor. We should remember the UDT represented the core of the politically literate civilian community. The destruction of this community by the military in the name of independence introduced a large measure of ambiguity into the international reputation of the movement proclaiming independence for East Timor . The UDT, or what was left of it, sought to petition Indonesia for integration and assistance. Thus began a phase of military intervention by Indonesia against Fretilin, which itself had chosen to live by the violent suppression of its internal opposition. It became a situation of very confused merit. Fretilin had acted to quell all voices but its own and had done so cruelly. In doing so, it has extinguished the prospect of a dialogue which could have emerged instead of the warfare which ensued between Fretilin and Indonesia. All this happened in 1975 and the suffering in subsequent years has been enormous. The community of East Timor had been a neglected one for centuries. By the time of the crisis only 20 per cent of the population was literate and the economic system under which the population of some 600,000 lived, was a very fragile one. The tragedy inherent in the political situation was compounded for Australians by the tragic death of the Australian journalists. This produced a difficult, emotional situation for all Australians. There are obviously still problems. Even today, so soon after the visit of the Parliamentary Delegation, there are reports of more military preparations against Fretilin dissidents. When Prime Minister Fraser visited Indonesia in October 1976, he emphasised the need for Indonesia and Australia to look not backwards but forward to a future which would alleviate, so far as possible, the human suffering which had come with the fighting and the associated disruption in the territory. Humanitarian aid from Australia to Timor was approved and a program of refugee repatriation initiated. This year following the change of government, the Timor question was catapulted into the front rank of issues to be tackled by the new Government. The Government pressed into action by a resolution of the Australian Labor Party of 1982, which said amongst other things: ' . . . the ALP opposes all defence aid to Indonesia until there is a complete withdrawal of Indonesian occupation forces from East Timor.' I will not quote all the difficult propositions in the resolution, but it is clear that it is fundamentalist in its objective and is designed in the form of a challenge to any effort to put the issue into a perspective which could ensure the continuance of constructive relations between the two countries. We may all be very sure that the Indonesian Government studied the text of the resolution very carefully indeed, particularly as it was apparent that the Minister for Foreign Affairs (Mr Hayden) was to make the Labor Party policy inherited from this resolution a central feature of his first major visit to South East Asia. It was inevitable that publicity given to the visit to Indonesia in the context of the policy of the Party, should present the Indonesian response as a test of Indonesia's bona fides. I believe the Indonesian Government behaved with considerable restraint. The reopening of the issue was not to be entertained lightly by Indonesia. At the United Nations last year, the former Prime Minister , Mr Whitlam, worked hard to put the issue to rest as an irritant in our bilaterial relations with Indonesia. I believe that the former Prime Minister acted out of a sincere personal conviction and against the background of a concern about the directions his own Party was taking, which if it prevailed, could only deepen irretrievably the division which had surfaced over this issue. But the uncertainty created by this washing of Labor Party linen in the South East Asian region, however inevitable from the Government point of view, has created a potential for doubt and misunderstanding. The Prime Minister has given the Indonesian Government reassurances and his visit did much to allay concerns which had been gathering and needed to be dispelled. The fact that the Government was testing its strength in its own Party on the issue was obvious enough, but the Indonesians could not be reassured by interpretations alone. The good will that exists in Indonesia towards Australia, and the good will that exists in Australia towards Indonesia, should not be clouded by these exercises in internal combat. I might borrow Mr Mungo MacCallum's comments at the time in the Age when, in relation to the processes of what he called the Government's indecisive decisions, he said: One thing we now understand about the new Government is that things will be done; but they will be done in particular, in respect of, with regard to, on the basis of, and over time. Exactly what will be done is still far from clear; but in a series of harangues yesterday (Wednesday 4 May) the Prime Minister, Bob Hawke, made it very clear that he is not about to reveal his plans for the rest of us to the rest of us. The Australian Financial Review on 11 April reported that the Minister for Foreign Affairs (Mr Hayden) informed the Prime Minister that unless Labor changed its position on East Timor relations with Indonesia would plummet to a post-confrontation low. He warned that the possible result could be the cessation of overfly rights for Qantas Airways Ltd and the barring of all Australian merchant and naval shipping from Indonesian waters. But the six weeks intervening before the Prime Minister's visit to Indonesia produced something of a crisis in the Labor Party, and the crisis has now re-emerged in the form of the report of the joint Australian Parliamentary Delegation to Indonesia. The report is not just about Timor. It endeavours-I think succeeds in this-to place the Timor issue in the context of our relations with Indonesia. Early in its observations the report states: The Delegation's visit took place during a period of awkwardness and sensitivity in our relations. The Indonesians certainly regard the Timor question as a critical test of Australian-Indonesian relations indicating that if differences persist the whole relationship will suffer. A more extreme illustration of this position was the accusation made during a wide ranging discussion in Jakarta that Australia, in permitting Fretilin representatives into Australia (as it did simultaneously with the Delegation's visit to speak at public meetings on their cause), was tantamount to the Australian government supporting the enemies of Indonesia in their efforts to subvert it. This view reflects the very real differences between Australia and Indonesia, and the failure by both parties to attempt to step inside the value system of the other to understand what each is doing and why. Australians must therefore attempt to understand how central an issue Timor is in Indonesia's measurement of its relationship with Australia. In one way Australia's position does not count. Indonesia has the support of all the countries of South East Asia, including Papua New Guinea. How Australia votes in the United Nations will make no difference to the situation in East Timor. Indonesia for the last six years has lived with the critical resolution of the United Nations. It regards the 1976 Act of Incorporation of East Timor into the Republic of Indonesia as final and irreversible. The report goes on to observe that a vote by Australia against Indonesia would not alter the situation in East Timor but it would, in fact, diminish any role that Australia could play in East Timor and Indonesia as a whole. I am mindful that Senator McIntosh has put in a minority report. Against the background of his decision, it is well to recall that the Delegation was given every assistance to visit any part of East Timor of its choice and to meet and mix with people freely. I note that the honourable member for St George (Mr Morrison ) in his speech mentioned the fact that the places that the Delegation visited were chosen by supporters of Fretilin. The Delegation travelled very widely and members spoke to a great number of people. I think the report makes an observation of considerable merit about the context in which the issue must be placed. It states: Indonesian and Australian leaders have publicly recorded their determination to foster strong and constructive relations. But the Delegation's visit to Indonesia helped it to appreciate that a realistic appraisal must acknowledge that the lack of shared values, the quite dramatically different histories, cultures and traditions of Australia and Indonesia will inevitably produce some awkwardnesses and misunderstandings. It continues: Hence to the great reservoir of goodwill that there quite clearly is in Indonesia towards Australia, and in Australia towards Indonesia, we find that in 1983 is added the need for a new maturity- The word 'maturity' is a very valuable word-a word which calls for the need of this House to address the issue in the perspective of the wide and valuable sweep of our relations with a nation whose very stability carries great consequences for Australia. I believe that, if certain concerns in Indonesia about Australia were to persist they would be misplaced, and would be fruitful only of disappointment to both of us. There is in Australia a large reservoir of good will and good sense towards Indonesia. There are moments when we will legitimately express an apprehension, and it to us. But let us put such moments in a framework of mutual concern to achieve the highest amity in our relations. Indonesia is a constructive force in South East Asia and the Association of South East Asian Nations. It is a matter of record that it has been very helpful , when there have arisen issues with a potential for misunderstanding in our economic relations with ASEAN. The relations between heads of government, both Labor and coalition, have been notable for good will and sound understanding. Therefore, let us, as a Parliament, restore the fundamental texture of a relationship which has within it the capacity towards greater mutual stability and understanding. The report before the House does not walk away from the issues but faces them realistically. I believe that the Delegation has acted in the spirit of its advice to this Parliament. It has shown a balanced judgment and a sensible maturity. It is a very important milestone that has provided the opportunity for Parliament to take an all-round view. It is unfortunate that the report was not a unanimous one. I believe that, at one stage, it was going to be a unanimous one. Certainly it would have helped relations even more if it had been a unanimous report. I congratulate the Delegation. Mr FRY(Fraser)(5.37) —I find it rather sad that, having listened to the very strong report by the Prime Minister (Mr Hawke) this morning on the inexcusable brutality of the shooting down of a civilian airliner and having supported that resolution, as I know all honourable members did, we now get a report on the same day that white washes a much greater degree of brutality in East Timor. It was a disgusting and inexcusable act of brutality to shoot down an airliner with 269 people on board, but over the last eight years somewhere between 150,000 and 200,000 people have been killed in East Timor. Almost one-third of the population has been wiped out. One would not know that from reading the report of the Australian Parliamentary Delegation to Indonesia. The report is a justification for Indonesian aggression; there is no question about that. It was not the intent of the Delegation to do that but that was inevitably what would result in this sort of report. The Indonesians are very experienced and very expert at stage-managing such visits. How could one possibly get a balanced view of what is happening or what has happened in East Timor? I was very sad, on coming into the chamber today, to hear the distortions of history being perpetuated time and again about what went on in East Timor. A member of the Opposition said that the terrible Fretilin people were responsible for the civil war. This is absolute nonsense. If people really want to know what happened in East Timor they should read that very excellent book of Jim Dunn called East Timor-A People Betrayed. That spells out very clearly what actually happened. It is a very fine book and every member of this Parliament should read it. The people of East Timor have been betrayed again today with this report which does nothing but whitewash the sorry, tragic history of what happened to the East Timorese people as a result of the brutal aggression of the Indonesians . I can only applaud the decision of Senator McIntosh to weigh in with a dissenting report. I am very glad that somebody stood up and said that all the Indonesian propaganda should not be accepted and that we should have a look at the other side of the picture. The honourable member for St George (Mr Morrison) said that the honourable senator was under pressure. He was under pressure from his own conscience not to accept the propaganda that was being fed to him. I congratulate him on coming to terms with his conscience and for saying what he felt about it in the light of his experience, the contact he has had with the Senate Committee on Foreign Affairs and Defence that has been looking into the situation and the huge bulk of evidence-I hope some of it will come out shortly in the Committee's report-which points up the brutality of the Indonesian occupation. One would have no inkling of it whatever from what I have read in this report so far. To point up the inadequacy of it, I refer to page 213, appendix 35, which deals with a Press conference on 3 August. The leader was asked about a report from me that the Indonesians were to launch a new attack on Fretilin. He rather rubbished that. He answered: We have one advantage over Mr Fry and Mr Araujo . . . we have just been there and we have seen for our own eyes and we have discussed with the Governor, with the military commander. I have already detailed the military commander's attitude and his mode of operations. Certainly nothing we saw, nothing we were told there gives any credence to that report. He said there was no credence in the report. A week later, the great gung ho general, General Moerdani, confirmed the report from the mouth of the leading general in Indonesia: 'We are going to launch a major operation against Fretilin '. I remind the House that there are only supposed to be two hundred of them left. General Moerdani continued: 'We are going to launch a major operation and wipe them out,-once again'. They have been wiped out so many times. It is time we learnt the lesson that these people are not just going to lie down and be trodden on and walked over by the Indonesians. It does not matter what we do, how many mealy-mouthed speeches we make, reports we bring out or foreign affairs cliches we use about friends, neighbours and relatives and all that sort of nonsense, or what goes on in the United Nations. The people on the ground will decide what is going to happen in East Timor. I have spoken recently to the East Timorese who have come to Darwin. They have said: 'It does not matter what happens outside. It does not matter what Australia, America or the UN does. We will never accept Indonesian domination. It does not matter what Fretilin does, even if it comes to some arrangement. We will never accept Indonesian domination.' I think we should remember this and not just accept the pragmatic, so called real politik view of the foreign affairs people and our own pragmatists who say: 'All right, the Indonesians are there. We can't get them out. We must accept them.' That is nonsense. History has a habit of catching up with aggression. It will catch up wilth the Indonesian aggression in East Timor the same as it will anywhere else. It might take a long time but it will happen. We should not sanctify Indonesia's aggression by whitewashing its actions in the way that we have done in the report. I speak in support of Gordon McIntosh's report. On page 83, the main sentence in his report is: There is a clear tendency to gloss over the circumstances in which East Timor was illegally seized in a long operation which caused great suffering to the Timorese people, whose current attitudes to their new situation we were simply not able to assess. We can understand the difficulties of the Delegation. The members of the Delegation were the captives of their hosts, but they did have a wonderful opportunity to make this report something worthwhile. That was when the two Fretilin people walked out of the bush and conducted a conversation with the leader. Unfortunately, the Delegation turned its back on a wonderful opportunity to get the other side of the story; to hear an alternative view point about what was going on. They had gone to the trouble of arranging a delegation to be there to meet our Delegation and we turned our back on them. I read the transcript of the recordings of the discussion that took place. I have some sympathy with the leader in that I believe that a misinterpretation of the conversation may have led him to make that decision. I have read the transcript, and that is how it seems to me. It was quite clearly misinterpreted. What they said was not in fact what they conveyed to the honourable member for St George. I give him the benefit of the doubt but, even so, the members of the Delegation missed a wonderful opportunity of meeting those people and hearing something of the Fretilin view point. Unfortunately, they turned their back on it. The other aspect I want to make some reference to is the fact that after eight years the killing continues. Even though my report was rubbished at the time, it has now been confirmed. We have had a report from Lord Avebury, of the Human Rights Committee of the European Parliament signed by hundreds of parliamentarians calling on the right of self-determination for the East Timorese. We have also had a report from the Timorese independence liberation movement in Lisbon spelling out in great detail some of the atrocities that have been committed on particular individuals in East Timor at the hands of the Indonesian invaders. People have been publicly castrated and left to die in the sun. People have had their bodies mutilated. There has been a report of cannabalism-one of the people eating a captured Fretilin person who was killed and saying: 'This is what we do to Fretilin', to try to frighten the life out of people. We cannot just turn our backs on this and say: 'It has happened. Too bad . We can't do anything about it.' I am just as concerned as anybody in this Parliament with having good relations with Indonesia. I do not see that we can't have good relations with Indonesia on the basis of their respecting our point of view as we respect theirs. We have a policy about the right of self-determination for all people. There is no question about that. Yet we are being advised to turn our back on it, forget it and say: 'Too bad'. We must not do that. Self-determination will not be brought about by politicians making statements here. As I said, it will be brought about on the ground of East Timor. But at the same time, Australian Labor Party policy is to support the right of self-determination for the East Timorese. It will not be changed either by people making statements in this House about how our delegation should vote at the next UN meeting on this issue. It should be and it will be decided by the Party itself. I ask honourable members to look at what happens in these situations. We cannot just say that the Indonesians are there, and therefore do nothing about it. The Indonesians have been in West Irian for 23 years. The people there are still resisting them. They will not accept them. The Indonesians have not succeeded in winning their minds and their hearts. There are plenty of other examples, of course, in places such as Ireland. The Armenians have been killing the Turks for many, many, years. That will go on. I do not think we can expect the East Timorese people just to lie down and forget about it. They are not built that way. They are a fine, proud race of people who value their independence more than anything else. They are not urgently in need of aid. I refer briefly to the list of names I gave to the honourable member for St George. It was not the list of places that were in the control of Fretilin. They were places which were fairly critical in relation to the possibility of famine or starvation. I understand, in fact, that it was confirmed. Some of the places the Delegation went to were not actually flowing with milk and honey. The position was rather tight. There is no question about that. I think that this report is a great shame. It will be seen for what it is-a whitewash for the Indonesian presence in East Timor. It will be used as such in a most blatant way, as propaganda. I think that the way it is written really destroys its own credibility by presenting such a one-eyed picture of what is going on in East Timor. I do not say that as a personal criticism of the Delegation. Members of the Delegation were captives of their hosts: they reported what they saw. Naturally the Indonesians guaranteed that they did not see anything the Indonesians did not want them to see. I give full credit to Senator McIntosh for putting in a dissenting report. I can assure honourable members he was under no pressure from his colleagues. The only conflict he had was that he wanted to get a consensus but he had the problem of his own conscience in signing a report with which he did not agree. I congratulate him for bringing out a dissenting report which adds a little balance to a one-eyed view of the situation. Mr SINCLAIR(New England)(5.49) —I think that the people of Australia need to recognise that the report of the Australian Parliamentary Delegation to Indonesia was the product of the willingness by the Government of Indonesia to try to help the present Government of Australia out of an impossible quandary. The views that have just been expressed, the views of Senator McIntosh, the views expressed at the 1982 Conference of the Australian Labor Party are the views of the Labor Party. The Government of Indonesia was forthcoming enough with the Australian Prime Minister, Mr Hawke, after the change of government to say: 'We recognise you have a difficulty'. It seems that the present Prime Minister is prepared to recognise and understand reality only when he gets into government, for he could well have expressed the views that he expressed in his visit to Indonesia at that meeting of the Australian Labor Party in 1982, when the present policy of the Labor Party was established. I think that we all know that the Prime Minister tends to have in public places a point of view that cannot always be matched by performance. Regrettably, the Australian people will find more and more that that is the case. But I welcome the thought that the Indonesian Government has been prepared to be as extraordinarily generous as it was to the Australian Parliamentary Delegation to enable the Delegation to spend time that was necessary for it to understand, discuss and meet with, as far as possible in a relatively short visit, as many people as they could in East Timor and try to understand the position there and the state of the Indonesian occupation of that country. I will discuss the issue on a number of bases. The first thing we need to remember is that it was the former Labor Prime Minister, Mr Whitlam, who first entered into discussions with the Government of Indonesia regarding the future of East Timor at the time of the drift in Portuguese domestic policies and the difficulties that the Portuguese were finding in maintaining any sort of control and law and order in its respective territories, not only to the north of Australia but also in Africa. On 26 August 1975 Mr Whitlam made these comments to the House: The other interested country . . . is, of course, Indonesia, with which we have been in very close touch on developments in Portuguese Timor in recent days. Indonesia has shared the Australian concern about the evident drift in Portuguese policies and, like us, has urged on the Portuguese the need to reassert Portuguese control in Portuguese Timor. We, for our part, understand Indonesia's concern that the territory should not be allowed to become a source of instability on Indonesia's border. I do not intend to recite the rest of the history of the development of Mr Whitlam's views. As my colleague the honourable member for Warringah (Mr MacKellar) mentioned a while ago, only last year Mr Whitlam, at a meeting of the United Nations, confirmed his views that it was foolish for Australia to persist in trying to suggest in some way that East Timor could exist in some form other than as part of Indonesia. Let me make it quite clear that that point of view was adopted by the coalition on its election to government. It was affirmed by the then Prime Minister on 10 October in a statement to the House when he referred to negotiations and visits made by himself and the present Leader of the Opposition (Mr Peacock) to Indonesia. He commented that the policy was a complex one which had been complicated by rapid changes in Portugal and the breakdown in that country's control and administration of East Timor. He believed that the important thing was to look to the future and to alleviate as far as possible the human suffering which had come with the fighting and associated disruption in the territory. He indicated that Australia would help with the humanitarian task. Indeed, it did so. The relationship then seemed to be on a stable footing. I was fortunate in being able to visit not only Indonesia but Dili and Atauro Island on 28 January this year. After discussions with Governor Carrascalao, President Suharto, General Benny Moerdani and other Ministers and officials of the Indonesian Government, I was also able to see some of the developments in the province of East Timor and on Atauro Island. It seems to me that several observations that I made on my return to Australia on 30 January have relevance to this debate and report of the Parliamentary Delegation. There is no doubt that East Timor's climate is very similar to Australia's climate. It certainly suffers from recurring droughts. I referred to the fact that from my observations it seemed in the relatively short time of Indonesian occupation that there had been far more done to help the people of East Timor than in the 400 years of neglect by the Portuguese administration. Anybody who criticises the circumstances of the Indonesian administration needs to remember that for many years little was done by the European administrators. It was in that climate, I am afraid, I viewed rather cynically the comments by Lord Avebury and members of the European Parliament in Lisbon yesterday which were reported in the Australian media this morning. There has certainly been a significant contribution by the Indonesian Government to correct the position and, per capita, the Indonesians are spending more in East Timor this year than in any other province. The budget in 1983-84 is $US17.3m, which is an increase of 9 per cent on last year's budget. It reflects a significant increase in allocation for the province at a time when the Indonesian Government has suffered from a decline in oil revenues and when it is generally cutting back on government expenditure in many other areas. Certainly, there are problems at Atauro. Anybody who goes there cannot help but be distressed by the plight of many of those who are currently under reasonably open detention, but nonetheless detention, on that island. Equally, there is no doubt that the people are free to move around. They produce some crops. During my visit with a number of linguists who could converse with the people on the island there seemed to be a number who felt that living conditions on the island were no worse than those to be found in some other parts of Indonesia. The Indonesian Government was very apprehensive, following the change of government in Australia on 5 March, about the consequences of this on the relationship between Australia and Indonesia. They welcomed the visit of the Minister for Foreign Affairs (Mr Hayden). It was interesting that on his return he stated: The whole chapter of East Timor has not been easy. The past cannot be forgotten . That is true. The Opposition does not believe that it should be forgotten. Mr Hayden continued: But equally the past should not dominate the present. It cannot be allowed to straitjacket our vision of the future. Of course, both he and the Prime Minister were forced to live with the resolution of the thirty-fifth national conference of the Australian Labor Party held in Canberra in 1982. None of the policies undertaken by the present Government have accorded with the form of those resolutions, whether in the terms of the definition referred to by my colleague the honourable member for Warringah, that the ALP opposes all defence aid to Indonesia, whether it supports the principle of free migration or whether it opposes the operation of Australian companies in East Timor. In no respect has the policy of the ALP to date been carried out by members of this Government. When the Prime Minister visited Indonesia he attempted to re-establish the relationship which was established by my colleague the Leader of the Opposition and by the former Prime Minister. He attempted to play down the effects of that policy. He has certainly generated within the Labor Party much concern, as reflected by the speech made by the honourable member for Fraser (Mr Fry) and the minority report of the Parliamentary Delegation presented to the Parliament by Senator Gordon McIntosh. The concern that we must all have is that, firstly, the Labor Party has a policy which seems to be in marked division in this place. The Prime Minister reportedly speaks for the Party; yet the Labor Party traditionally, through its platform, constitution and rules laid down by its biennial conferences, has seen those as the policies that bind it not just as a party but as a government. Members of the Opposition are interested to know, with regard to the report of the Parliamentary Delegation, to what degree the Government finds itself able to continue to diverge from the official policy of the Party. Secondly, and more importantly, is the position of the future. We on this side of the House are concerned that in the resolution of the relationship between Australia and Indonesia there should be no debate on an issue which we believe should long ago have been put to rest. The question of the status of the province of East Timor within Indonesia, in my view and, fortunately, in the view of the majority of the members of the Parliamentary Delegation, is no longer at issue. However, there are many matters on which there should be, and must continue to be, dialogue and debate between Australia and Indonesia. As the leader of the Delegation, the honourable member for St George (Mr Morrison), has said, unless there is a preparedness within the Labor Party to put to rest the question of sovereignty, I believe that in the future we are likely to be less able to resolve those significant issues of humanitarian concern and some areas of policy differences. Reference has already been made to the death of journalists-a matter which concerns many people in the Australian media and which concerns members of this Parliament, and rightly so. Again that is a matter of the past. Whatever the actual fate of those journalists and the cause of their deaths, I do not believe that in 1983 we can advance without accepting that there have been differences of opinion on that issue and that there the matter must lie. Equally, I believe that there needs to be concern about family reunions. Honourable members on both sides of this House-my colleague the honourable member for Denison (Mr Hodgman) is one-have expressed concern that family reunions should continue and that about 150 people who are still to be repatriated to Australia should be allowed to do so within a reasonable time. There has been concern about drought aid and humanitarian aid of various types. The previous coalition Government was particularly forthcoming in trying to meet the needs of the people of East Timor and in trying to help the Government of Indonesia to undertake those additional responsibilities that it accepted when in 1975 East Timor became part of Indonesia. There is too the question of the accreditation of Australian journalists in Indonesia. Because of the many differences between Indonesia and Australia there are different attitudes towards things which might be said. I was delighted that the honourable member for St George referred to his concern about some of the less rational statements which unfortunately are broadcast in the Australian media. Having read the comments on AM this morning by Lord Avebury and of the delegation in Lisbon, I am concerned that they are sensational in character and seem unsubstantiated in kind. If there are allegations about famine, they have not been echoed by the record of this Parliamentary Delegation. It certainly was not seen by me during my visit. Indeed, it seems that the Indonesians have done the best they can to improve the lot of the residents of East Timor. We all need to remember that Indonesia is a country of many islands. They stretch as far as Perth is from Wellington, or as Dublin is from Moscow. Within that island nation there are many races and many different lingual groups. There are many attitudes and views different from those in Australia. Their concept of pancasila, the state ideology, is perhaps hard for Australians to comprehend. Yet Indonesia is a nation with which we must live. It is a country of 155 million people. Some of its provinces have the greatest population concentrations in the world. It is extraordinarily fertile. It is very rich in mineral resources. It has an enormous future. In my view, Indonesia could well be the Japan of the next two decades. In those circumstances, for Australia to have anything but good relations with that neighbour would be foolish. I endorse the Indonesian proverb used by my colleague the honourable member for St George- better a good neighbour than a distant relative. Let us hope that this parliamentary report can at last bring some common sense into the policies of the Labor Party. Those who seek to dissent on this issue might at least recognise that East Timor is a matter of the past. Let us get on with a proper and positive relationship with Indonesia. Question resolved in the affirmative. Bill presented by Dr Blewett, and read a first time. Motion (by Mr Willis)-by leave-agreed to: That so much of the Standing Orders be suspended as would prevent the Minister for Health, when moving the second reading of the Bill, speaking without limitation of time. Second Reading Dr BLEWETT(Bonython-Minister for Health)(6.06) —I move: That the Bill be now read a second time. The Health Legislation Amendment Bill and the related levy Bills not only represent a major social reform, but are an essential part of the Government's economic strategy. Not only do they embody a health insurance system that is simple, fair and affordable, but they represent an advance in the social wage and our accord with the trade union movement, and in moderating the impact of inflation. Medicare will play its part in economic recovery. This legislation embodies one of the major policies this Government placed before the people of Australia last March-and for which a clear and unequivocal mandate was received from the Australian people. Let there be no doubt about that fact-Medicare was a central plank in our platform. It was discussed extensively prior to the campaign and debated exhaustively during the campaign. Unlike our predecessors, who shied away from any discussion of health policy at election after election, the Australian Labor Party placed firmly and squarely before the Australian people the health policies which are incorporated in this legislation. The tortured, contradictory and reactionary policies of our predecessors have led us back into the past. In 1969 Justice Nimmo wrote: The operation of the health insurance scheme is unnecessarily complex and beyond the comprehension of many. And to quote further: The contributions have increased to such an extent that they are beyond the capacity of some members of the community and involve considerable hardship for others. That is a statement from the 1969 report on health insurance, but I defy any impartial observer to say that these statements are not equally true of today. It is a measure of the circular nature of health policy in this country, and the waste of the last seven years of Fraser government, that we are here today fighting battles that should have been finally decided a decade ago. Mr Fraser's tragically broken promise that 'we will maintain Medibank' given in November 1975 has led us inexorably back into the past, back into dependence on those old Liberal allies, the private health funds, to run basic health insurance. The Fraser Government departed in March this year, leaving behind a health insurance scheme almost identical with that of its predecessor, the McMahon Government of a decade ago, with all its flaws, with all its inequities, discriminations and confusions. What Mr Fraser bequeathed this country was a health scheme lacking in both universality and fairness. The latest Australian Bureau of Statistics survey shows that 1,953,000 Australians were without any health cover through either private insurance or the Commonwealth cover provided to pensioners, the unemployed and low income earners. The current health scheme has increased basic private insurance premiums to approximately $14 a week for a family. If we were not introducing the Medicare program on 1 February next year the cost of a ward bed in a public hospital throughout Australia would be $130 a day, and premiums would have risen even higher still. For those lower and middle income earners who do take health insurance, the costs have become a substantial strain on the family budget. The task facing the Hawke Government is thus much the same as that faced by the Whitlam Government, and I am proud that our solutions are much the same. Unfortunately, the Fraser Government's gutting of the Medibank name and concept have meant that the word itself developed unfavourable connotations. Medibank has become linked in many people's minds with the seven years of confusion under the previous Government. But I do not resile from openly stating that the principles of the Medicare plan are similar to those of Medibank as it was originally introduced in 1975. There are two important differences. Firstly, Medicare will be substantially self-funding through the 1 per cent levy and a rearrangement of existing health insurance subsidies, whereas Medibank placed a considerable strain on Consolidated Revenue. That was due to an obstructionist Senate, which encouraged by the Australian Medical Association, the private funds and the other voices of reaction of the time, repeatedly rejected the Medibank enabling legislation. The Medibank Bills were only eventually passed at the Joint Sitting which followed the 1974 double dissolution, but unfortunately the levy Bills did not meet the criteria for submission to the Joint Sitting. I am pleased to say that while there has still been considerable opposition to our health insurance proposals, on this occasion the debate has been much more reasoned and rational in its tone. Our opponents have for the most restricted themselves to differences of opinion, rather than the litany of distortions and alarums of 1973 and 1974. Secondly, the arrangements for reimbursing the States are different this time. I will go into the details of the current proposals later, but let me say that I think this difference reflects the tougher economic circumstances of the 1980s. Also, this Government is concerned to ensure that taxpayers' dollars are allocated to areas of greatest need. So our payments to the States represent a fair reimbursement of revenue that will be lost through removal of public hospital charges, rather than a generous increase in overall funding for all the States, except in the case of Queensland where the unique situation of Queensland's public hospital system is recognised by a $35m special grant in a full year over and above compensation payments. We have sought in planning Medicare to produce a simple, fair, affordable insurance system that provides basic health cover to all Australians. In designing the Medicare program four attributes have been uppermost in the Goverment's mind. I refer firstly to simplicity. The simpler we make a health scheme the more chance it has of delivering the services to those who need the most. The more complex a health scheme, the more likely it is to favour the well -off, the articulate and those capable of manipulating a complex system. While the nearly two million people without health insurance or Commonwealth health protection are mostly low and middle income earners, the complexity of the current arrangements also allows the rich to avoid contributing to the community pool of health dollars collected through the insurance system. For those well enough off to meet their health bills throughout the year, and with a range of taxation deductions available through a careful arrangement of their financial affairs, health insurance is an unnecessary waste of money. Spared the cost of insurance premiums, they also know that the majority of their health bills will be refunded through the taxation system. In contrast to those who have lawyers and accountants to organise their affairs , low income earners are expected to be able to cope by themselves with the bureaucratic complexity of the health care card system. An itinerant labourer on varying weekly incomes is asked to average his income from the last four weeks, check to see if it is less than $193 a week for a married couple, and notify the Department of Social Security if his income exceeds that average by more than 25 per cent in any one week. It is little wonder that many do not apply, as indicated in the 1982 health insurance survey details which showed that well over half a million people entitled to a government concession card were paying for private medical and hospital cover. Under Medicare people will not have to worry about falling behind in their payments and being caught with substantial bills. Every Australian resident will be covered automatically and the 1 per cent payment will be made along with, but separately identified from, the tax instalments in the weekly or fortnightly pay packet. For those who do not have pay-as-you-earn deductions the health levy payment will be calculated as part of their annual payment of income tax. Medicare will provide basic health cover free of the hassles and worries of the current private insurance scheme. It will also make health insurance fairer and affordable to every Australian because everyone will contribute towards the nation's health costs according to his or her ability to pay. This is in stark contrast to the current scheme, where the flat rate contribution means that a family earning just above the income limits for a health care card must pay 7.2 per cent of its total income toward basic health cover, whereas a family on $50, 000 a year pays only 1.4 per cent of its income for exactly the same cover. Medicare has income thresholds below which no levy is payable. The limits for this year will be $128.80 a week for a single person, and $214.25 a week for a married couple, increasing by a further $21.15 a week for each dependent child within a family. The threshold has been set at these levels to ensure that everyone who currently receives free health cover through a pensioner health benefits card, or a health care card for the unemployed and low income earners, will not have to pay the levy under Medicare. The current system has different income limits for different entitlement cards so that pensioners can earn more than a low income earner and retain their health concession card. This discrimination is removed under Medicare as the same income thresholds will apply for everyone. Because we have adopted the higher pensioner income limits approximately 200,000 people who now just miss out on a low income health card will receive basic health cover under Medicare without having to pay any levy. Medicare will provide the same entitlement to basic medical benefits, and treatment in a public hospital by the hospital's doctors, to every Australian resident regardless of income. This universality of cover is obviously desirable from an equity point of view. In a society as wealthy as ours there should not be people putting off treatment because they cannot afford the bills. Basic health care should be the right of every Australian. I reject the arguments of those opposite who say providing cover to everyone will encourage overuse of health services. There is no reason to expect that the two million Australians currently without any cover will use medical and hospital services more than the rest of the community, and to restrain overall health costs by excluding those two million people from treatment except in the direst emergency, as the current scheme does, is not a situation which this Government-or any other humane government-would allow. Beyond this obvious matter of principle, universality of cover also has many advantages in terms of efficiency and reduced administrative costs. Doctors and hospitals will have their bad debt problems removed overnight. This will significantly reduce doctors' practice overheads and in public hospitals reduce the amount of bureaucracy required to check whether a person is entitled to free treatment, record his private fund membership or chase him for payment if he falls into neither category. There are also significant advantages through universality in reduced payment delays for doctors and lower overall administration costs in paying medical claims through a single public fund, but I will go into those matters in more detail later. However, it is important to state unequivocally right now that one of the Government's major objectives through the Medicare program is having the maximum number of health dollars spent on delivering health services rather than administering them. The conservatives opposite, through their opposition to Medicare, would lock governments and private practitioners into continued unnecessary waste on insurance services that have nothing to do with improving the health status of the Australian people. That should alert all of us to the fact that their opposition has nothing to do with principles or ideals-of which they are singularly bereft. Rather it is simple political expediency, and opposing for the sake of opposing, that has characterised many of their hollow statements on this issue so far. I come now to the precise implementation of those proposals in the Bill before the House. Firstly, I refer to those who are eligible for Medicare benefits. They will be available to all persons ordinarily resident in Australia with the exception of members of diplomatic missions and other dependants. The Bill provides that the Minister for Health may make written declarations regarding the eligibility of persons or groups of persons who may or may not be entitled to Medicare benefits. To this point, the Government has agreed that eligible persons will include: All permanent Australian residents, including repatriation beneficiaries and defence force personnel; persons visiting Australia who obtain approval to stay for at least six months, with eligibility to date from arrival in Australia; persons visiting Australia who originally obtain approval to stay less than six months, but who are granted an extension which makes the total approved stay more than six months, with the eligibility to date from when the extension was granted; persons visiting Australia who are residents of countries with whom Australia may in the future negotiate a reciprocal health care agreement; persons who are residents of certain neighbouring countries who come to Australia for specialist hospital care, subject to rules laid down by State Health Authorities; and Australian residents receiving medical services while travelling overseas. Medicare benefits will be payable at the same rate and for the same range of services as are currently provided by the private funds on their basic medical benefits table. Clause 12 of this Bill sets out the rate of Medicare benefits, which will be 85 per cent of the schedule fee, with a maximum patient payment of $10 for any one item where the schedule fee is charged. The same level of benefit will be payable for all types of patients and replaces the present confusing and complex arrangements which provide for different levels of Commonwealth benefits according to type of patient and method of billing by providers. This change is an essential component of Medicare and will provide for equity, simplicity and efficiency. The move to a single level of Medicare benefits for all will mean a reduction in benefits presently payable for pensioner services and disadvantaged persons' services, with the increase in maximum gap from $5 to $10. However, this will not affect benefits payable for most general practitioner consultations and the effect on other benefits is only marginal. The range of services covered by Medicare benefits comprises medical practitioners, certain surgical procedures rendered by approved dental surgeons, consultation services rendered by participating optometrists and services by accredited dental practitioners in the treatment of cleft lip and cleft palate conditions. Medicare benefits cover the full range of doctors' services including treatment by specialists, surgery, and diagnostic services such as radiology and pathology. They are also payable for medical services rendered to in-patients of public and private hospitals. Following the entry into formal agreements by each State and the Northern Territory with the Commonwealth, all persons eligible for Medicare benefits will also be entitled to public hospital in-patient accommodation and treatment without charge, where that treatment is provided by a doctor appointed by the hospital. Out-patient treatment in public hospitals will also be provided without charge. Arrangements currently applying whereby benefits are not payable for medical and hospital services to compensable patients-that is, motor vehicle , third party and workers' compensation services-will remain unchanged under Medicare. However, I intend to examine together with the States and the general insurance industry whether it may be possible to simplify the administrative arrangements for these services at some future date. To avoid a situation of one Commonwealth agency raising charges for which another Commonwealth agency is required to pay benefits, the Government has decided that charges currently raised for services received from Commonwealth Pathology Laboratories or Commonwealth medical officers will cease from 1 February 1984. Under Medicare doctors will be able to elect to direct bill for any patient and the Medicare benefit will be paid in full settlement of the account for that service. The present direct billing arrangements are limited to pensioner health benefit, health care and health benefit cardholders. There is also currently a three-tiered system of Commonwealth medical benefits-85 per cent for pensioners and the disadvantaged, 30 per cent for the privately insured and nil for the remainder. Because of this categorisation of entitlement the previous Government decided that a person's eligibility for benefits has to be established before any payment can be made. This bureaucratic maze of cross-checking between the number on the assignment voucher and Social Security's entitlement records is the major reason for the current unacceptable delay in doctors receiving payment for their direct billed claims. The introduction of these checks earlier this year increased the number of claims being rejected from 5.5 per cent to 14.0 per cent and therefore increased the number of claims requiring double handling by over 150 per cent. The Health Department's somewhat antiquated computer hardware and systems and the previous Government's unresponsive attitude to increasing processing staff numbers as the lengthening dole queues increased the number of people eligible for direct billing are also partly responsible for the current delays. I have recently approved the employment of 111 temporary staff to help reduce the backlogs, but as long as we remain with the present insurance system it will be difficult to provide an acceptable turnaround time on claims. However, I am confident that because Medicare provides the same rate of benefit to all Australians and therefore removes the need for eligibility checking-combined with the modern, on-line processing systems of the Health Insurance Commission- the delay between lodgement of direct bill claims and receiving payment will be reduced to one to two weeks. Once this level of service is established and well known I expect many doctors will take advantage of the direct billing system. The greater the use of direct billing the lower administrative costs will become for doctors and the Government and the lower the cost of seeking treatment will become for the patient. After the introduction of Medicare it is desirable that the private health insurance funds be able to wind down their medical benefit activities as soon as possible. The Bill therefore provides that benefit claims for medical services received prior to 1 February 1984 should be lodged with the relevant health benefits fund by 31 January 1985-that is, within 12 months as opposed to two years under the current arrangements. Where there is good reason for a claim to be lodged later than this date, or where the 'cut off' would impose undue hardship, the Minister will have discretion to allow a longer period. For services rendered after the introduction of Medicare the current time limits will apply. They are for direct billed claims to be lodged within six months of the date of service and for patient billed claims to be lodged within two years. In line with the recommendations of the 1980 Jamison Commission of Inquiry into the Efficiency and Administration of Hospitals appointed by the previous Government we will be legislating to prevent both private health funds and general insurers from offering cover for the 'gap' between the Medicare benefit and the schedule fee. The reason for this is quite simple and practical. As the AMA stated in evidence to the Jamison inquiry: Doctors generally believe that there should be a charge at the point of service . In this report Jamison noted that 'it'-gap insurance-'underpins the practice of fixing charges above the schedule fee'. Therefore, if we allowed gap insurance we would not be saving people money. They would simply be paying $2 from their own pocket on top of their 100 per cent of schedule fee rebate, instead of $2 for the difference between the Medicare benefit and the schedule fee on a standard GP consultation. This would be in addition to the insurance premium for the gap cover, so overall most people are financially better off without gap insurance. It is only doctors who would be financially better off if gap insurance were permitted. For all of these reasons the Government will not allow gap insurance to be offered. In this way doctors will be encouraged to limit their charge to a level around the schedule fee and this will be important in containing Australia's overall health bill. The private health funds will be able to offer insurance that supplements the basic cover provided by Medicare. All organisations registered under the National Health Act will offer that insurance in accordance with the community rating principle, which is that everyone pays the same contribution rate regardless of age, sex, family size or medical condition. The only exception is that single persons pay half the family rate. This is different to Medicare because Medicare is not an insurance plan in the commercial sense. Under Medicare persons do not contribute to ensure cover for themselves or their family for a specific period. Rather they will contribute towards a national health pool according to their income. Whether a person is single or a family member does not affect the ability to pay except in determining the low income thresholds for levy payments. All Australians will be entitled to the same Medicare cover and so they will draw from this pool according to their health needs. In this way Medicare is more a social service scheme, so it is inappropriate to differentiate between married and single people for determining their health levy payment. People wishing to have private treatment in a public hospital or treatment in a private hospital will be able to insure for these costs. At the time of the election we planned that the basic private table would offer a benefit equal to the private bed charge in a public hospital. This charge was subsequently set at $80 a day. While it was always intended that this level of benefit would be payable in private as well as public hospitals the private hospital organisations pointed out that this level of benefit would not cover the cost of many private hospitals. It would therefore be necessary to have probably three additional hospital tables supplementing the basic private table at different benefit levels. Such a gaggle of tables would only have created confusion and uncertainty and we were conscious of the dangers of creating a situation where sharp movements in hospitalisation patterns from the private to the public sector were likely. To simplify the hospital insurance options under Medicare and to prevent any shift occurring, the Government has decided to introduce a system of categorisation of private hospitals, to which I will refer in more detail later. What this categorisation system means to the general public is that differential benefits are paid from the basic private table, so this table will provide cover for private treatment in a public hospital and shared ward accommodation in most private hospitals. The range of benefit levels contained within the basic private table means that we expect there will need to be only one further supplementary hospital table providing cover for higher cost or single room accommodation and additional charges such as theatre or labour ward fees. I should emphasise that there will be no need for anyone to take out hospital insurance if they are satisfied with the care provided in public hospitals by doctors employed on a salary or sessional basis by the hospital. For those who do want private treatment in hospital the basic private insurance premium will be about $5 a week for a family. Except for the introduction of Medicare public hospital charges would be rising to $130 a day throughout Australia by early 1984, and basic medical and hospital insurance premiums would be on average $14. 50 a week for a family. Because the abolition of the private insurance tax rebate is part of the funding of Medicare, that $14.50 basic premium becomes a cost of $10.15 a week after allowing for the 30 per cent rebate. On this basis a family would have to be earning more than $515 a week or $26,780 per annum before total health cover-that is, the Medicare levy and the private treatment in hospital cover-became more expensive under Medicare than under the current scheme. After allowing for two income families, it is still the case that two out of three Australian families earn less than $515 a week and will therefore pay less for this level of cover under Medicare than under the present scheme. Sitting suspended from 6.30 to 8 p.m. Dr BLEWETT —I now turn to ancillary tables or extras cover for dental and paramedical services, which has been a relatively neglected area of health insurance. The private funds currently generate most of their income from basic medical and hospital insurance, but with the medical sector removed they will be expanding the range and level of their ancillary benefits. People will be able to obtain cover for services such as dentistry, physiotherapy, home nursing, chiropractic and chiropody from these tables as well as the costs of aids and appliances such as artificial limbs and wheelchairs. Funds will no longer be able to restrict the membership of the extras table by requiring a person to be a member of another table also. With the reduced cost of basic cover to most people through the Medicare levy, these extras tables will prove an attractive option for many people. The Government believes that its role is in providing basic medical and hospital cover, and the decision on whether to take ancillary cover is then left to the individual. The other limiting factor is that inclusion of any or all of these extra services into Medicare would substantially increase its costs and therefore the levy would have to rise. This is undesirable in terms of offering people basic health cover at the lowest possible cost. The National Health Act currently provides that a waiting period of up to two months may be applied before basic benefits are payable. It is proposed that this two-month waiting period will be maintained for the private table under Medicare, but that a nine-month waiting period will apply for obstetric cases. Furthermore, because of the 'safety net' of free public hospital treatment under Medicare, it is considered unreasonable that persons should be able to take out private insurance specifically for hospital treatment for known illnesses. Accordingly, organisations will be permitted to apply a waiting period for benefits for pre-existing ailments of up to two years after a contributor joins an organisation or transfers to a higher table of benefit. It should be noted that section 81A of the Act becomes inoperative after 1 February 1984. This provides that pensioners and disadvantaged persons who lose their entitlement to free care under the present scheme will be entitled to take out private insurance for basic cover without the need to serve waiting periods. That is the present position. This provision will not be necessary as under Medicare every Australian will be automatically entitled to the same basic cover. A fundamental principle of the Medicare arrangements is that every Australian should be entitled to public hospital accommodation and treatment by the hospital's doctors without charge. Against this background, the Bill will enable the Commonwealth to enter into formal agreements with the States and the Northern Territory in relation to the provision of public hospital and other health services. Heads of agreement, attached as a schedule to the Bill, provide the parameters for the agreements, which are required to be substantially in accordance with those heads. The agreements will, on the one hand, specify the range of public hospital services which the States are to provide without charge to eligible persons and, on the other, the financial arrangements to apply under which the Commonwealth will reimburse the States for revenue losses and any additional costs incurred in providing such services. The grants will comprise payments for: Revenue losses and additional costs resulting from the removal of all in- patients and out-patients fees in respect of patients who elect to be treated free as public patients in public hospitals; revenue losses resulting from a reduction in fees for private patients in public hospitals; provision for the future payment by States of daily bed subsidies to private hospitals from the block grants (from, it is expected, 1 July 1985); the payment of grants for community health purposes; and provision for escalation of or variation to components of grants. These compensatory grants will be additional to, and independent of, the identified health grants currently paid to the States within the Federal-State general tax sharing arrangements. The current estimate for such payments- excluding community health funds-to the States and the Northern Territory and in respect of the Australian Capital Territory for the period 1 February 1984 to 30 June 1984 is $198m. The estimate in respect of full year funding is $709m. Included in these payments to the States is the offer of a special grant to Queensland of $15m in 1983-84 and $35m in a full year. These grants are offered to ensure that all States receive marginally more in additional receipts from the Medicare program than they contribute in additional outlays. Mr Speaker, I seek leave to incorporate in Hansard a table which illustrates how the Medicare financial arrangements are broken up between the States. Leave granted. The document read as follows- Estimates of net outlays on Medicare, by State, full year (6m) NSW Vic. Qld SA WA Tas (a) Total Additional Outlays (b) (d) 629 484 220 163 163 57 1762 Additional receipts (and reduced outlays) (c) 621 472 212 145 143 45 1680 Net outlays +8 +12 +8 +18 + 20 +12 +82 (a) Includes Northern Territory and Australian Capital Territory. (b) These include outlays for medical and optical benefits, compensation for revenue losses due to reduction and abolition of charges in public hospitals, special grant to Queensland, increases in subsides to be paid to private hospitals, gross establishment and administration costs, and increased outlays for the expansion of community health services. (c) These include savings on the reduction in contributions to the Re-insurance Trust Fund, revenue from the introduction of a one per cent levy on taxable income, and savings from the abolition of the present income tax rebate on health insurance. Dr BLEWETT —I thank the House. This table clearly shows that Queensland is not subsidising any other State, as the Queensland Premier is so fond of claiming in his desperate attempt to retain power by whatever means. In fact Queensland is the only State government which has its overall health funding situation improved by Medicare. All the other States are receiving grants which simply compensate them for revenue lost by removing and reducing charges. The Queensland public hospital system is being compensated for its revenue losses and receiving a special grant to revitalise its hospital services on top of this , and that is a recognition of the unique situation in Queensland. Every cent raised through Medicare in Queensland is being returned to Queensland, and the State Government will receive far more in health funding from the Hawke Government than it received in the last two years under Mr Fraser. Last year the Queensland Government received $93m in health funding from the Commonwealth Government. In the first full year of Medicare Queensland will receive $173m. Only Mr Bjelke-Petersen in an election year could complain about that sort of deal. In addition to specifying the financial formulae to apply to the compensatory grants, the agreements will also encompass other essential matters, including the requirement that public hospital admissions be solely on the basis of medical need, without regard to health insurance status; and the Commonwealth- State consultative arrangements which will be set in train so that the financial and operational arrangements can be monitored and modified as necessary in the mutual interests of the Commonwealth and the States. This consultative process will also consider matters such as the development of peer review and hospital audits, the expansion of hospital accreditation, and the development of certificates of need for high technology equipment. The Government believes that these measures all have scope for achieving economies in the area that is unquestionably the most substantial generator of health costs in this country. The purpose of these consultative arrangements is to give effect to the Government's belief that the Commonwealth has a positive role in the broad national policy and planning aspects of public hospital provision. For a considerable time, concern has been expressed by Commonwealth and State health Ministers about rights of private practice for salaried doctors in public hospitals. This concern has arisen partly from the variety of arrangements and schemes under which salaried doctors exercise their private practice rights, lack of detailed knowledge about how such schemes operate, and how the funds available under those schemes are applied. Receipt of medical benefits income by staff specialists provides them with a source of income, over and above their salaries determinations, which is generally accrued during the same working hours in which those salaries are payable. In effect, there is a double payment mechanism operating. The doctors receive a full salary, which can be considered to be drawn from both State and Commonwealth revenue to the extent that each contributes from State revenue sources and from Commonwealth cost sharing- identified health grant payments towards the cost of health services. Over and above that, the Commonwealth pays again through medical benefits. At this point let me assure the House that the Government has no intention that rights of private practice arrangements be abolished; rather, that appropriate control mechanisms be developed. The concerns about the operations of private practice rights particularly relate to diagnostic services and some therapeutic services- pathology, radiology, radiotherapy and nuclear medicine-where there is not usually any direct doctor-patient contact, where there is substantial scope for generating additional revenue, and where there is a significant technical content to the service which is provided by the hospital rather than the doctor. For this reason the Bill provides that Commonwealth medical benefits are payable only for diagnostic services provided to in-patients and out-patients of public hospitals if the service is provided pursuant to a contract between the medical practitioner providing the service and the hospital granting a right of private practice, of a form accepted by the Commonwealth Minister. It has been agreed with State Ministers that the content of the contract will be: A All accounts to be raised by the hospital on behalf of the doctor. B All charges to be at or below schedule fee. C All revenue received for diagnostic services rendered under private practice contracts for full time specialists in a particular hospital to be treated as one fund. D The fund to be applied in the following order: 1 Facility charges (recovery of costs) to the hospital in a form acceptable to the Commonwealth Minister. 2 Drawings by the doctor at a level determined by the State, up to 25 per cent of full time specialist salary. 3 Any residual to be applied following guidelines set by the State Ministers for Health. My officers are currently negotiating with State health officials on how the conditions for visiting diagnostic specialists could be more equitable when compared with those proposed for salaried staff. However, I would stress again that these measures will be aimed at ensuring accountability measures are introduced into rights of private practice, and not at removing those rights. The Government has also expressed considerable interest in reactivating community health services as a viable and less costly alternative to the more expensive institutional services, and, as a consequence, will be supporting this aspect of health care under the Medicare arrangements. The formal agreements with the States and the Northern Territory to which I referred earlier will also make provision for the funding of new and/or expanded community health services. The sum of $7.2m will be provided to the States, the Northern Territory and the Australian Capital Territory for such purposes for the period 1 February to 30 June 1984, and a total of $18m in a full year. In addition the Commonwealth will retain $0.8m in 1983-84 and $2m in a full year for allocation to community health projects of national significance. With these funds I was able to make a grant of $100,000 a year for the next three years to the Lidcombe Workers Health Centre so that it can continue as Australia 's leading centre in dealing with occupational accidents and disease. The additional $20m in a full year will restore community health spending to the 1975 real levels of expenditure. As I indicated earlier when referring to the basic private table to be offered by the health funds after 1 February next year, private hospitals are to be categorised, and the daily insurance benefit and Commonwealth bed subsidy will vary according to that categorisation. The reason for categorisation is that the steep increases in public hospital charges over the past two years have allowed private hospitals to piggy back their fee increases in line with those increases . That is reasonable in so far as the increases reflected increases in costs, but most of the increase resulted from the Fraser Government's $228m reduction in health funding to the States over those two years. This was a 32 per cent cut in the real level of health funding to the states. Private hospitals are a very diverse range of institutions. At one extreme are the major surgical hospitals, mostly run by religious or charitable organisations, which provide a level of care and services comparable with that in the major public hospitals. At the other extreme are bush nursing and other small hospitals, generally located in rural areas, which, except for a few beds, provide a service similar to that of a nursing home. What is striking under the present insurance system is that, despite the large difference in cost structures brought about by the different level of care provided, the insurance benefits they receive are almost the same. So while the acute hospitals require this level of fees to survive, there is a substantial scope for profit in the medical or nursing hospitals. By categorising private hospitals the benefit and bed subsidy they receive will be much more closely related to their services and cost structure. We are proposing a 3-tiered structure so that category A hospitals receive a $120 a day basic benefit and a $40 a day Commonwealth bed subsidy; category B receive a $ 100 a day benefit and $30 a day subsidy; and category C an $80 a day benefit and $20 bed subsidy. The total cover in the three categories of private hospital will therefore be $160 a day, $130 a day, and $100 a day. The Government believes that categorisation will allow the health fund's basic private table to offer cover for a shared room in most private hospitals, provided the industry is prepared to accept that from 1 February 1984 the benefit will reflect reasonable cost levels rather than the inflated fees that some hospitals charge now. The categorisation will follow principles laid down by the Minister in regulations made under section 23H of the Health Insurance Act. The principles for categorisation will reflect factual measures of the type of services provided in the hospital. However the Minister will have due regard to the opinion of the State Minister before finally determining the hospital's category . Clause 45 of this Bill makes the Minister's decision on categorisation subject to administrative review by the Minister and also appealable to the Administrative Appeals Tribunal where a private hospital proprietor believes his hospital has not been correctly categorised in accordance with the principles as set down. The Commonwealth currently allocates $86.7m to the private hospital industry through the bed day subsidy. The increased subsidy levels under Medicare mean that a further $46.5m will be allocated in the first full year of Medicare. The Government believes that the States should have the major role in planning the total health services available in the community. For this reason we believe that the daily bed payment to private hospitals would be more appropriately paid by the States. Most State health Ministers accept the logic of this transfer of functions. However they consider it to be legislatively and administratively impossible to have it in place by 1 February 1984. For this reason the Commonwealth will continue to make the daily bed subsidy payment to 30 June 1985 , but individual States can take over the function prior to that date if they wish. The Government is aware of the shortcomings of the current arrangements relating to patients who are accommodated in either private or recognised hospitals for extended periods, and who are, in essence, nursing home-type patients. The existing arrangements for classifying long stay patients provide that after 60 days continuous hospitalisation patients are reclassified as nursing home-type patients and are required to make a non-insurable patient contribution towards the cost of accommodation, in the same way that a patient in a nursing home does. The fund benefit payable in a public hospital is reduced to the level of the standard nursing home benefit. In a private hospital the hospital's charge is reduced by the amount of the patient contribution. Where the patient's doctor considers that the patient has a continuing need for acute hospital care, the doctor may issue a certificate under section 3B of the Health Insurance Act in which case the nursing home-type arrangements do not apply. Currently there is no review mechanism relating to the issue of such certificates. The Government considers these arrangements to be unsatisfactory and, as a result, this Bill reduces from 60 days to 35 days the period after which a patient is automatically reclassified as a nursing home-type patient, unless an acute care certificate is issued by the patient's doctor. In deciding to reduce the statutory period to 35 days, the Government had regard to the fact that this is five times the average length of stay in hospitals. A further refinement of the current arrangements will be the establishment of a review mechanism in the form of acute care advisory committees which may review a medical practioner's decision to issue a certificate and recommend to the Director-General of Health that such a decision be affirmed, varied or revoked. From 1 February 1984, the new nursing home-type patient arrangements will apply in all States, with their introduction in New South Wales from that date. The effect of these new arrangements will be that an insured patient in a private hospital who is classified as a nursing home-type patient will be paid $80 per day less the patient contribution. The payment will be frozen at this level until such time as it is equal to the standard nursing home benefit plus patient contribution. Private hospitals will then be receiving the same amount as public hospitals for their long stay patients. However, the Commonwealth daily bed subsidy will be paid at the rate applicable to the category of hospital in which the patient is accommodated. For a nursing home-type patient in a recognised hospital, who elects to be treated as a private patient, the current arrangements will continue to apply; that is fund hospital benefit reduces to the standard nursing home benefit. In the case of public patients there will be no accommodation charge, but the patient contribution will still be payable. Clause 67 of the Bill amends the Health Insurance Commission Act to confer the Medicare functions of the Commission. The Health Insurance Commission will act as a single public fund for the provision of Medicare benefits to the Australian people. There are several reasons for the Government taking this decision after careful consideration of all the options for administering Medicare benefits. Firstly, it is undeniable that the single funds will be able to perform the task equally efficiently but at a much lower cost. The 1981-82 report by the Department of Health on the operations of the health funds showed total medical fund management expenses of $148.4m, of which $98m can be apportioned to the cost of providing basic medical benefits. In determining the overall cost of administering basic medical benefits under the current health scheme the $20m per annum cost to the Health Department or administering direct billing for pensions, the unemployed and low income earners must also be considered. Taking these two amounts together the cost of administering basic medical benefits payments is to the order of $130m in 1983-84 dollars. The Commission will administer the same benefit payments for $86m in a full year. This is a saving of $40m per annum when compared with what it costs to administer the same benefit payments under the present complex private insurance scheme. The initial establishment costs of Medicare will be $56m in this financal year which, when added to the operating costs from 1 February 1984 of $34m, means that the gross administration costs of Medicare will be $90m in 1983-84. The savings incurred through the single public fund operation will recoup the initial establishment costs of $56m in less than two years. The economies of scale involved in having a single public fund operation must produce significant administrative savings. This fact is recognised in the platform of the Australian Democrats which states: Under the present health insurance arrangements there is considerable waste of members' funds in advertising and in duplication of staffing and computer equipment. It also states: A national health scheme must be easy to understand, simple in operation and designed to eliminate unnecessary costs, including those in administrative procedures whether in government of private organisations. The Health Insurance Commission can provide a convenient network of branch offices that will make cash payments to Medicare benefits and receive claims for cheque payment through the use of 280 offices throughout Australia. The private funds currently support a structure of about 1,000 branch offices because there are often the offices of several different funds located close together in a suburban shopping centre or metropolitan business district. This duplication of facilities in the private insurance system must make a single public fund operation less costly. Similarly, the private funds cannot claim that they will employ 2,000 extra staff and run Medicare more cheaply. In a labour intensive industry such as health insurance the cost of this number of extra staff cannot be compensated by internal cost advantages through competition. This is where in choosing the Health Insurance Commission the Government is not appointing a public monopoly, rather it is handing the administration of Medicare to an efficient, progressive organisation which has coped remarkably well with the changes of different situations thrust upon it over the past ten years. In 1975 the private health funds were all given the opportunity to act as agents for Medibank. No major fund took up the offer and the Voluntary Health Insurance Association of Australia now cites as a major reason for this refusal the fact that it believed the Medibank claims assessing system would be hastily installed and result in problems and confusion. It believed that if it accepted the agency offer and acted as the public contact point it would be blamed for any problems that occurred. As a result of its refusal to run Medibank the Health Insurance Commission was entrusted with the task of achieving the 1 July 1975 deadline without any major public inconvenience. It is this ability to take on a massive task of implementing a universal health program such as Medibank within a tight timetable-a task the private funds then believed was impossible- which gives us the confidence in Medibank Private's ability, the Health Insurance Commission's ability, to implement the Medicare program. Having successfully administered a public fund for more than three years, the Health Insurance Commission had its functions reduced to that of another private fund by the November 1978 health scheme changes. The removal of the public function left it with 3,000 surplus staff and a computer system which was not appropriate to its future needs. Within 14 months Medibank Private had developed an on-line claims processing system that is at least equal to the best in Australia. The efficiency of its processing system has enabled Medibank Private to remain competitive despite its higher salary rates and additional superannuation liability for all employees. From the 1978 changes Medibank Private was left to cope with the gradual rundown of surplus staff members as its staff levels had been an unnecessarily heavy cost. Its management expenses have fallen steadily from 15.5 per cent of contribution income in 1980-81 to 11. 3 per cent in 1981-82 to 10.1 per cent in the last financial year. There has been some criticism of Medibank Private operations in the smaller states. Australia-wide it has been able to obtain 23 per cent of the already crowded private insurance market, but in some states its smaller market share has affected its relative efficiency. However, the efficiency of the organisation is illustrated by the situation in Victoria, where Medibank Private has a comparable market share of its major competitor, HBA. In that State Medibank Private had a management expenses ratio of 11.6 per cent in 1981-82 compared with 12.5 per cent for HBA. Denials of comparability by HBA are nonsense. The Auditor-General's scrutiny of Medibank Private to ensure a fair proportion of administrative costs is far more stringent than for any private health fund. It cannot be denied that the discipline of the market-place has been a major factor in achieving this outstanding management record. It is one of the important reasons why we want to continue having the Health Insurance Commission operate Medibank Private as well as the Medicare function. Competition in the private insurance market will keep the Health Insurance Commission a lean and efficient organisation and these qualities will also extend to its Medicare operation, allowing it to run a universal fund at the lowest possible cost to the taxpayer. We do not wish Medibank Private to obtain a monopoly position in the private insurance market as this would sacrifice many of the cost advantages I have just outlined. For this reason we have been willing to place limitations on Medibank Private's membership so that its share of the private insurance market is restricted. The window into the private insurance market-place that Medibank Private will provide is also essential to our policy of reduced controls over the private funds' operations. We believe that private insurance can be much more effectively regulated by the use of Medibank Private as the 'honest broker' in the market. The other major argument in favour of having a single public fund operate Medicare is the timely and accurate supply of data on doctors' services in the detection of fraud and overservicing. The continuation of the present system whereby 63 different organisations supply that data means that the accumulation of doctors' profiles is dependent on the speed of the slowest fund. The Health Insurance Commission is currently the timeliest and most accurate fund in Australia, with a 99.97 per cent accuracy level in the statistical data it supplies to the Health Department for fraud and overservicing purposes. While the overall responsibility for investigating fraud and overservicing will remain with the Health Department it is pertinent to note that the Health Insurance Commission has been among the most active of the private funds in pursuing suspected cases of fraud. In fact, the amendments to the Health Insurance Act contained in clause 58 of this Bill which make bribery by a proprietor of a private hospital an offence largely came about through the efforts of Medibank Private in pursuing what it correctly considered to be a rip-off of contributors ' funds, but which the inadequacy of the current laws prevented it taking to court. The final factor in favour of having the HIC administer Medicare was that, as I outlined earlier, the Government would find it impossible to entrust such an important program to the private funds, considering their opposition to Labor's health policies throughout the past decade. While there would be a relationship of trust if the Health Department were to operate Medicare, it would have neither the experience to administer such a large benefit payments organisation nor the administrative efficiency that accrued to the HIC through its five years of operation in the private market. In seeking consensus with the private funds on the introduction of the Medicare program the Government has offered a range of concessions. There are three main reasons for the concessions announced: Firstly, to guarantee a continuing substantial role for the private funds and ensure Medibank private could not gain unfair commercial advantage through the Health Insurance Commission's operation of Medicare; Secondly, to minimise the possibility of redundancies caused by Medicare's introduction; and Thirdly, because Medicare will provide basic cover to all Australians there is no longer a need for the Government to regulate the funds' operations so closely. Clause 73 of the Bill gives the Minister a general power of direction from the Health Insurance Commission. All directions made by the Minister must be set out in the annual report which is subsequently tabled in the Parliament. Once the Parliament has agreed to this power of direction I will be making three directions in relation to Medibank Private's operations. Firstly, Medibank Private membership will be limited in each State and on each table to the numbers as at 30 June 1983. Secondly, Medibank Private operations will be limited to their present 195 offices. The greater overall work volumes following Medicare's introduction may mean some transfers to larger premises at an equivalent site. However, Medibank Private will not be able to operate from the 86 new Medicare offices which will be opened before 1 February 1984. Thirdly, to ensure that the Health Insurance Commission's operation of Medicare and Medibank Private does not give Medibank Private an unfair advantage in lower administrative costs that could be passed on in lower contribution rates, I will be directing that the management component of all their contribution rates must reflect average industry costs. These directions under section 8J of the Health Insurance Act will apply up to 30 June 1986, at which time these policies will be reviewed. Clause 101 of the Bill creates a new section 73BAB in the National Health Act which means that funds will operate under a minimum reserve policy rather than the current maximum reserve policy. The change to minimum reserves means that the Government's concern is to ensure the financial viability of each fund, but we will not be controlling the contribution rates to reduce the reserve levels of a profitable fund. Clause 101 also creates a new section 73BAC which allows the Minister to remove restrictions from the private funds as to the sorts of business they can carry on in addition to their health fund activities. Provided these other activities are entered into on a normal commercial basis this will allow the funds to set up their own companies and diversify into other activities such as general insurance, travel agencies, retirement villages, et cetera. Following their loss of medical insurance from 1 February this diversification potential will allow them to retain staff in new activities after 1 February. Clause 128 of the Bill allows the Minister to approve merges between solvent funds. This will facilitate industry rationalisation in what is still a crowded private insurance market as funds will no longer have to go through the current costly and time consuming winding up procedures involving the Federal Court of Australia. Clause 119 of the Bill amends section 78 of the National Health Act. Funds will no longer require the approval of the Minister to change its rates of contribution or benefits and conditions of operation of all tables. As I outlined earlier, because Medicare provides basic cover to all Australians the Government no longer considers it necessary to regulate the funds beyond ensuring that overall financial viability and deciding the general principles for their operation. To this end clause 78 of the National Health Act has been amended to limit the requirements for ministerial approval to the benefits and conditions on the basic table only. These conditions go much into the way to providing the de-regulation the private insurance industry has sought for many years but neither Labor nor Liberal governments felt able to grant while they were responsible for providing basic health cover in our society. The concessions on restricting Medibank Private's operations clearly prove that this Government has no intention of seeking monopoly control of the private insurance industry. One of the issues raised during the discussions with the private funds was the question of employment of fund staff. This question was also raised during the discussions I had with the Australian Council of Trade Unions. All along the Government has made it clear that employment preference would be extended to employees of the private health funds who sought employment with Medicare and who were affected by the introduction of the new program. The transfer of staff from the private health funds to Medicare will be handled with efficiency and compassion. At this stage let me however lay to rest the claims that have been made that at least 5,000 people will lose their jobs because of Medicare. These claims, Mr Deputy Speaker, are widely exaggerated and based on figures calculating the size of the private health insurance industry which are much exaggerated. The private health insurance industry has traditionally had a high turnover rate of employees and, when this is taken into consideration along with the diversification opportunities the Government will offer the private funds, the employment prospects of fund staff will be maximised. As well negotiations are proceeding with the Department of Employment and Industrial Relations and the Public Service Board to further expend the employment prospects of affected private fund staff. Finally, it is with regret that I note the continuing negative attitude of the Opposition to Medicare. The shadow spokesman for health, the honourable member for Mackellar (Mr Carlton), continues to regard medical and hospital services as market commodities rather than basic rights for all Australians. He has made it quite clear that he would abandon Medicare immediately on attaining Government. On 22 July this year he told a health symposium at Sydney University 'The diffidence that in 1976 prevented us'-that is the Liberals-'from moving swiftly away from the earlier model would not be repeated'. Perhaps fortunately, his leader does not share that view. When pressed on the matter at the National Press Club on 7 July 1983 he could only provide the following gnomic utterance ' We will have to make our assessment of the extent to which Medicare has permeated the Australian community at a later date'. I am confident that through the full implementation of Medicare we will achieve such permeation through the Australian community such that Medicare will remain the basic form of health cover until the end of the century. While the Federal Opposition remains negative I acknowledge that the Australian Democrats have voiced some disquiet on particular features of Medicare. Their leader even speculated recently that the Government would not really be that sorry to see Medicare stopped because this would assist the Government to keep the Budget deficit down. I would point out first of all that a $25m saving this year in abandoning Medicare would have only a very marginal impact on a Budget deficit of $8,361,000,000. But more importantly, Medicare is vital to the Government not only as a social policy on its own merits for providing simple, fair and affordable health cover to all Australians but also as a key element in the social wage policy and a key element in guaranteeing wage moderation over the coming year. The union movement is supportive of Medicare because the greatest benefit of the scheme will go to low and middle income earners who make up the majority of its members. Average family earnings are just over $400 a week and at this level the family would pay only $4 a week in the health levy. This is a saving of $10.50 a week when compared with the estimated cost of private insurance by early 1984 and the saving will represent extra cash in the weekly pay packet of wage and salary earners. Medicare is also estimated to reduce the consumer price index by 2.6 per cent over the first two quarters of 1984. Thus Medicare plays a major role in the anti-inflation strategy of the Government. For all these reasons Medicare is a vital policy for the Hawke Labor Government but we are not prepared to accept fundamental changes to that legislation at the behest of the minority parties. The Government will be judged on the success or otherwise of Medicare. Mr Groom —Hear, hear! Dr BLEWETT —It must, therefore, have the final say on the basic machinery to implement the scheme. No government could abdicate that responsibility. I am glad to find the honourable member for Braddon agreeing. Medicare is a policy on which the Government kept every commitment made during the election campaign. My only concern with the minders in the Senate is to ensure that someone keeps them honest to their own election undertakings. We have a clear mandate from the people to enact the Medicare program in all its fundamentals. The Medicare program and its costings were made freely available for public scrutiny and debate over 12 months prior to the election. This is in sharp contrast to the five schemes of the previous Government all of which were hatched in secrecy and none of which were presented to the electorate. So let there be no talk from the Opposition benches of not having mandates. Their health schemes had to be hidden away at election times not promoted as a major policy initiative as Medicare was in February and March of this year. As for the claim that Medicare may have a mandate but not its administration through a single public fund such as the Health Insurance Commission, let me refresh some memories on this point. First of all, the Medicare policy document which has been freely available since February 1982 has as its first statement following the introduction 'all Australians will be guaranteed automatic entitlement under a single public insurance fund'. Then again earlier this year we issued a booklet entitled Labor's Health Plan-Summary of Arguments for use during the election campaign. The book was widely circulated and freely given to journalists and the public with queries about Medicare. In a section comparing the Liberal health scheme with the Labor health plan it was stated, 'Having some 80 health funds is administratively inefficient and costly'. It then went on to state, 'Having a single public fund for all medical insurance is cost efficient- advantageous of scale, reduced administrative and advertising costs'. It seems that only a few members of parliament are unaware of this commitment. The members of the funds themselves were under no illusions as was pointed out by John Short in an article in the Sydney Morning Herald on 25 May 1983 when he wrote: 'the funds have known for the past three years that the ALP is committed to having its Medicare scheme run by one public health fund, namely, Medibank. And if the honourable member for MacKellar and Senator Haines wish to continue this 'nobody told me' charade I would remind them of my speech to the Australian Hospitals Association in Adelaide late last year entitled 'Consistency and Consensus in Labor's Health Policy', later reprinted in the Australian Health Review. They were both present during that section of the course because we all spoke from the same platform. During my speech I stated: While we will not found our system on the private health agencies we recognise they have a continuing, if subordinate, role to play. There will be substantial opportunities for the private funds to supplement the public fund with forms of hospital cover and to provide a wide range of ancillary covers. In this legislation we are honouring precisely that commitment. Further, during the election campaign the Voluntary Health Insurance Association of Australia produced a spurious costing document on Medicare and circulated it widely among the Press and the then Government. This was the basis for many stories about Medicare having a 2 or 3 per cent levy, but let me just cite one in particular. The Age in an article of 26 February 1983 entitled ' Medicare Levy would Double Say Funds' quoted the VHIAA's Executive Director as stating 'medicares deficits would total $1,800m after three years of operation' and 'in its first full year of operation medicare would face a deficit of $253m and by 1987-88 the annual deficit would rise to $1,805m'. However, following the election they had to concede that these figures were grossly inaccurate and thus they issued a revised draft of the costing document. The magnitude of their deliberate or negligent errors in their election propaganda was such that: the three year Medicare deficit became $496m instead of $1,800m; the first full year cost became $162m instead of $253m at election time, and the 1987-88 deficit became $614m instead of $1,805m at election time. Whatever the reason for these errors, the damage was done before the post- election corrections were issued. I ask the House to consider the competence and integrity of an organisation that put forward such figures during the campaign- and these are the people to whom the Opposition would ask the Government to entrust the running of Medicare. Having witnessed the strident and at times malicious campaign waged by the private funds against Medicare I am sure that very few electors went to the polls on 5 March believing that the Labor Party could or would entrust Medicare's operations to the private funds. Only by ignoring all of these statements and all of these activities is it possible to deny that the ALP has a mandate to operate Medicare through a single public fund . For too long confusion, continual change and complexity have been the hallmarks of Australia's health insurance system. The Government's Medicare policy which this legislation enacts, reverses the confusion, changes and complexities of the past. No longer will health insurance be a costly necessity for Australian families. It will, Mr Deputy Speaker, be their right. I commend the Bill to the House. Debate (on motion by Mr Carlton) adjourned. Bill presented by Mr Hurford, and read a first time. Mr HURFORD(Adelaide-Minister for Housing and Construction and Minister Assisting the Treasurer)(8.40) —I move: That the Bill be now read a second time. When I introduce the Income Tax Laws Amendment (Medicare Levy) Bill 1983, I will outline the basic features of the Government's scheme for introduction of a Medicare levy. This Bill-the Medicare Levy Bill 1983-declares the basic rate of levy. For 1983-84 the basic rate will be 0.416 per cent of taxable income, that is, five-twelfths of the full year rate of 1 per cent. The Bill also contains rules for fixing the maximum amount of levy payable and the income points below which people with low incomes will not be called on to pay any levy. As I will mention in my speech on the Income Tax Laws Amendment (Medicare Levy) Bill, the basic rate will be reduced by one half for certain repatriation beneficiaries and service personnel who are liable for the levy because their dependants are eligible for Medicare benefits. Explanations of each clause of the Bill are contained in the explanatory memorandum which will be available to members shortly. I commend the Bill to the House. Debate (on motion by Mr Howard) adjourned. Bill presented by Mr Hurford, and read a first time. Mr HURFORD(Adelaide-Minister for Housing and Construction and Minister Assisting the Treasurer)(8.43) —I move: That the Bill be now read a second time. By this Bill, and the other that I have just introduced, it is proposed to impose a Medicare levy of one per cent of the taxable income, as determined for income tax purposes, of people residing in Australia. The Bills are a finance- raising complement to other measures designed to implement the Government's universal Medicare scheme. Other basic features of the scheme are contained in legislation that has been introduced by my colleague, the Minister for Health, ( Dr Blewett). Introduction of the levy is timed to coincide with the coming into operation of the main Medicare legislation on 1 February 1984. Because the Medicare arrangements will apply for only five months of 1983-84, the rate of levy to be applied to 1983-84 taxable incomes is set at five- twelfths-or 0.416 per cent-of the annual rate of one per cent. At the upper end of the income scale, the maximum amount of levy payable by a taxpayer or by a married couple will be $291.20 for 1983-84 and $700 for a full year. For low income taxpayers there are relieving provisions which have the effect that a person whose taxable income is less than $6,699 will not be liable for the levy. There are further relieving provisions in respect of people responsible for maintaining dependants. These will apply to both married couples and sole parents. In these cases the levy will not be payable where the person's taxable income together with, where the person has a spouse, the taxable income of his or her spouse, is not more than $11,141. This threshold is to be further increased by $1,100 for each dependent child or student maintained by the taxpayer or his or her spouse. Thus, for example, a married couple with two dependent children will not pay any levy unless the aggregate of the couple's taxable incomes is more than $13,341. Provision is also being made to give relief from the levy to certain classes of persons, including veterans and war widows. The broad principle is that a veteran or war widow who is personally entitled under repatriation arrangements to full free medical treatment for all medical conditions, whether or not war-caused, and who has no dependants or who has dependants who are also entitled to such medical benefits, will be completely free from payment of levy. If the repatriation beneficiary is entitled to full cover personally but has a spouse or one or more dependent children not fully covered by a repatriation scheme, relief will be given for one-half of the levy that would otherwise be payable. Defence Force personnel and those people who hold pensioner health benefits cards, health benefits cards or health care cards on a non-income tested basis will be eligible for relief from the levy on the same terms as proposed for repatriation beneficiaries. For these purposes the spouse of a veteran or a child under 16 will be treated as a dependant if the veteran contributes in any way to their maintenance. A child who is aged 16 or more but less than 25 and who is a full time student will be treated as a dependent if his or her separate net income is not above $1,785. A fundamental objective of the legislation is to integrate collection of the levy with the collection of income tax. This has distinct administrative advantages and is the most economical and sensible course to follow. It does, however, require a number of provisions of a technical kind. Much of what is contained in the Bills is concerned with these technicalities, and explanations of the various provisions are contained in an explanatory memorandum which I have arranged for honourable members to receive shortly. I mention in particular that pay as you earn deductions from salaries and wages will be increased from 1 February 1984 to take account of the levy. The legislation also provides for a separate identification in assessments of the amount of a taxpayer's liability for Medicare levy, as distinct from income tax liability. The Bill will also amend the tax sharing legislation to make clear that collections of levy are not to form part of the revenue in which the States and local government share, given that the levy is being introduced to offset Commonwealth expenditure on Medicare. The various terms of the Bill, including technical clauses that provide for levy to be payable on certain income derived by trustees and for people living in the external territories to be exempt, are, as I have already indicated, explained in a memorandum that will be made available to honourable members. In these circumstances, I think I need say no more at this stage about particular features of the Bill. With pride and pleasure I commend this Bill to the House. Debate (on motion by Mr Howard) adjourned. Bill presented by Mr Hurford, for Mr Keating, and read a first time. Mr HURFORD(Adelaide-Minister for Housing and Construction and Minister Assisting the Treasurer)(8.50) —I move: That the Bill be now read a second time. The purpose of this Bill is to amend the States (Tax Sharing and Health Grants) Act 1981 so that provisions relating to health funding will be consistent with the Medicare arrangements, agreed upon at the 30 June-1 July 1983 Premiers Conference, due to commence on 1 February 1984. Under the Medicare program, additional public hospital funding will be provided to the States and the Northern Teritory to ensure that these Governments are not financially disadvantaged by the introduction of Medicare into their public hospital systems . At the same time, it is proposed that the existing funding arrangements under the States (Tax Sharing and Health Grants) Act will continue separately, at least until its expiry on 30 June 1985. Health grants have been payable to the States and the Northern Territory under the Act since 1 July 1981. They replaced grants payable under the hospital cost- sharing agreements for States-other than South Australia and Tasmania, whose hospital cost-sharing agreements were to continue to the end of 1984-85-and the Northern Territory, and payments for community health and school dental programs for all States and the Northern Territory. These health funding arrangements, involving grants for general purposes but identifiable as a Commonwealth contribution towards the cost of health programs, were seen by the previous Government as an interim step towards full absorption of health grants into tax sharing grants. While those States no longer receiving hospital cost-sharing payments are not necessarily required under the current legislation to expend their identified health grants on the provision of health services, they accept these grants under certain conditions. In particular the existing legislation requires the States-other than South Australia and Tasmania-and the Northern Territory to provide free access to accommodation and treatment in public hospitals to all eligible pensioners and persons in special need, and their dependants. The legislation also requires these states to furnish certain information concerning the provision of these services. The Medicare proposals have two implications for the health funding arrangements which I have just outlined. First, South Australia and Tasmania have agreed to participate in the Medicare compensation arrangements on the condition that they terminate their hospital cost-sharing agreements with the Commonwealth on 31 January 1984. Secondly, the Medicare compensation payments are to be provided to the States and the Northern Territory on conditions which include, among other things, that they provide accommodation and treatment in public hospitals without charge to all Australian residents who do not elect to be treated as private patients. The States and the Northern Territory will also be required to make available a range of health statistics to the Commonwealth. The amendments proposed in this Bill, therefore, provide for South Australia and Tasmania to receive, from 1 February 1984, health grants under this Act in place of grants payable under the hospital cost-sharing agreements. As a result, this aspect of their health funding arrangements with the Commonwealth will be brought more into line with arrangements currently applying in all other States and the Northern Territory. Nevertheless, these changed arrangements largely preserve in 1983-84 and 1984-85 the relative benefit which will have accrued to both these States from the continuation of their hospital cost-sharing agreements with the Commonwealth after 30 June 1981. In 1983-84, South Australia and Tasmania will each receive an addition to their identified health grant after 1 February based on the amount that each would have received had their hospital cost-sharing agreements run for the whole of 1983-84 in the absence of the Medicare arrangements. In 1984-85, this additional identified health grant payable will be equal to the amount otherwise payable for the whole of 1983-84, escalated in line with the growth in total Commonwealth tax collections in 1983-84 over 1982-83. This is consistent with the treatment of the health grants provided to other States and the Northern Territory under the current arrangements. The Bill also removes the conditions imposed on the States under the current arrangements in respect of free hospital services and associated data requirements. It is proposed that the conditions which the Government requires to be met by the States in the hospitals area under Medicare will be covered by regulations under the Health Insurance Act as detailed by the Minister for Health (Dr Blewett) in a separate statement. The provisions contained in this Bill are important elements in the Government' s overall Medicare policy of providing all Australians with ready access to medical and hospital services. I commend this Bill to the House. Debate (on motion by Mr Howard) adjourned. Debate resumed from 23 August, on motion by Mr Hurford: That the Bill be now read a second time. Mr HOWARD(Bennelong)(8.57) —The Income Tax Assessment Amendment Bill (No. 3) 1983 completes the clear breaking of yet another of the Government's pre- election commitments, and that of course is the commitment made solemnly by many spokesmen for the Government that the home interest deductibility arrangements that existed at the time of the last election would be maintained. It is therefore instructive in addressing this legislation to take the House back to the circumstances of the housing debate of 12 or 18 months ago and to examine both what was said then by the Australian Labor Party on the subject of the attitude and record of the Fraser Government towards housing assistance and what in fact has eventuated, the Labor Party having been elected to government. It is instructive to look not only at the statements of the then Leader of the Opposition but also at the statements of the Labor Party's spokesmen in this area. One recalls that when the housing package of 19 March 1982 was introduced the cry of the Labor Party was that it was a case of too little, too late, to too few families. Yet that same party in government, little more than a year later, is able not only to turn that statement on its head but also to take away most of the assistance that was provided by the former Government. I think the performance of the Government in this area is one of its more abysmal performances so far as the breaching of election commitments is concerned. We are already aware that the Government has withdrawn the general housing interest rebate that was provided in the 1982 Budget. With virtually a snap of the fingers on 19 May the Treasurer (Mr Keating), in his mini-Budget statement, took away that concession-a concession the like of which was constantly urged to be introduced by the Labor Party during its years in opposition. I can recall motion after motion moved by the then Leader of the Opposition and by the honourable member for Gellibrand (Mr Willis), who was then the economic spokesman for the Labor Opposition, calling for interest on housing mortgages to be made tax deductible or tax rebatable. When on 19 March last year a limited form of assistance was introduced not only did the then Opposition criticise it but also it called for a far more generous scheme to be introduced. When the former Government introduced in the Budget a scheme that provided for a taxation rebate of housing interest rates over 10 per cent on a mortgage or mortgages to a total of $60,000, that move also was criticised by the then Labor Opposition as being too niggardly, too mean and not doing enough to match the aspirations of people who sought to own their own home. I would have thought that it was common ground between both of the major parties in this Parliament that we ought to adopt policies which maximise private home ownership. It has certainly been a goal of the Liberal and National parties, both in government and in opposition, to adopt policies which maximise private home ownership. I put it to the House that in the time that we were in government we not only pursued those policies but also we were instrumental in bringing about an increase in the volume of private home ownership. If one looks at the most reliable statistics produced on this subject, one finds an appreciable increase in the volume of private home ownership between 1976 and 1982. That was a direct reflection of the policies pursued by the former Government. Over the last 12 months there have been very considerable changes in the housing market in Australia. The availability of money for mortgages, so much a problem about 18 months ago, is no longer the problem that it was. Lack of demand is more of a problem now than it was some 18 months ago. Once again, policies introduced in defiance of the Labor Party played a role in bringing about an increase in the availability of money for housing purposes. Every step that was taken by the former Government to deregulate interest rates to some extent was criticised by the Labor Party when it was in opposition. We were told by the then Labor Opposition that if we gave more flexibility to the banks, if we went down the path of some deregulation of interest rates, we would drive up housing interest rates even further and that we would contract the availability of money for housing. Of course, the reverse has been the case. The moves that were announced on 18 March last year as part of the housing package produced by the Fraser Government included a significant degree of deregulation and reform so far as the savings banks of this country are concerned. Those reforms, in my view, played a major role in improving the competitive position of savings banks in Australia at present. It would be no secret to the Minister for Housing and Construction (Mr Hurford), that over the last year deposits in Australian savings banks have gone up by about 20 per cent , which is the largest rise for over 10 years. Some of that is undoubtedly due, as I would be the first to concede, to the fact that in depressed economic circumstances savers are more likely to place their money in low risk deposits. Mr Hurford —Most of them. Mr HOWARD —I do not argue that undoubtedly that has played a major role. I accept the comment of the Minister for Housing and Construction that that has played a major role in the increase in the volume of deposits. But one of the other things that has happened, of course, is that it is no longer the case in Australia that savings banks are subject to regulation in bidding for deposits. That change was introduced by the former Government after the 1980 election. Of course, it was regaled at the time by the then Opposition as being a shameful step down the path of deregulation. But it has played a major role in improving the competitive position of savings banks. It helped to redress an imbalance in the system that existed against the savings banks. I believe that that change, together with the changes that were announced on 18 March 1982, have played a part-I think a significant part-in bringing about the improvement in the deposit situation of savings banks. It is my view that the sooner we have a total deregulation of all interest rates in Australia, the sooner we will have a far better and more equitable position with regard to the availability of funds for the areas that we desire to help. I believe the case which has been made against the regulation of interest rates, not only by the Campbell Committee of Inquiry into the Australian Financial System in its report but also by other works in this area, is overwhelming. Far from interest rate regulations and controls having worked to assist the very people they were designed to assist, they have had a perverse effect in that area. They have brought about a severe rationing and an unavailability of funds in many cases for people in the housing, small business and rural sectors whom they were designed to help. That matter belongs to the general area of housing finance and it is perhaps a little outside the ambit of this Bill, which deals with the modification of the tax rebate of March 1982 and declares, in general terms, that entering into that limited scheme will not be available to anybody after 30 September this year. In so doing, of course, it completes the duo of repudiation over which the honourable member for Adelaide, the Minister for Housing and Construction, has presided in his first six months as Minister. He has succeeded in having removed from the statute books the concession that provided to every person paying off a home in Australia interest rebatability on rates over 10 per cent on loans to a total of $60,000. By this second measure he is succeeding in taking away, after 30 September 1983, the measure that was brought in on 19 March 1982. That is not a bad effort from the Minister for Housing and Construction in a Labor Government who was able to say when we introduced the measure of 19 March 1982 that it was a case of too little not going far enough for too few families! That is not a bad effort for somebody who has been in that position for only six months! We can only contemplate what will be the situation after the honourable member for Adelaide has been in the housing portfolio for a little longer. Once again, I remind the House and the Australian community that what this Minister has done is to preside over the clear and unmistakable repudiation of a simple, unambiguous election commitment that was made by the Australian Labor Party before 5 March. Not only did members of the Labor Party run around the country over the last 18 months saying: 'Look, it is absolutely terrible that the Liberal and National Parties are not doing enough for housing, that March interest rebate should have been more generous and that Budget rebate should have been more generous'. It was not sufficient for them to do that; what they then had to do was to compound all of those criticisms and statements by producing, at the time of the last election, a policy that is really a bottler in the context of this debate. That policy is dated 28 February 1983. Mr Hurford —Hear, hear! Mr HOWARD —The honourable member says: 'Hear, hear'. The policy is an absolute bottler in the context of this debate. It goes under the heading of 'Statement by Tom Uren, MP, Federal Labor spokesman on housing, urban and regional affairs- 28 February, 1983'. The document states: On the other hand, home buyers will be given increased protection by a Labor Government . . . The statement then lists a series of dotted points. The first dotted point states: tax rebates on mortgage interest payments; That was the promise. The reality, the actuality, is that after 30 September 1983-after a bare seven months under the Hurford regime-under the policies of the Labor Party in the housing area nobody in Australia will be able to apply for interest rebatability. That is not a bad effort, a bad performance, on the part of the Labor Party so far as its housing policy is concerned. What was the next point? I ask honourable members to listen to this: increased household spending power as a result of progressive tax cuts and ' social wage' improvements; That is not a bad one. What is the third dotted point? It states: easing of interest rate pressures through a more appropriate monetary policy; One day it is accommodating. Next day it is neutral. Now it is an 'appropriate' monetary policy. I come to the fourth point. I will give the Government some credit for this because at least it has not interfered with the changes which we made last year in this area and which, of course, made a significant contribution to what has been achieved in the area. The fourth point reads: an adequate flow of housing funds at affordable interest rates through Labor's housing finance measure; The only reasons that there is an adequate flow of money into housing at present are the reasons I stated a few moments ago: Firstly, the fact that in times of economic recession savers are more likely to be attracted to low risk deposits; and, secondly, the deregulatory measures which were taken by the Liberal- National Party Government over the last two or three years and which were criticised by the Labor Opposition at the time as taking us down a perilous path but which fortunately so far have not been the subject of interference. The fifth point listed here is: reduction in interest rate volatility through Labor's retention-- listen to this- of historical measures for government regulation of the financial system. We can take our pick as to what that means, either in the context of what was promised at the time or in the context of what has been done since. All I would say in all seriousness to the honourable member for Adelaide, the Minister for Housing and Construction (Mr Hurford), and to his colleague the Treasurer (Mr Keating) is that if the Government really wants to maintain the present availability of funds for housing, if it is really interested in preventing volatility, the last thing it will do is implement the measures it promised before the election it would implement in this area such as the proclamation of Part V of the Financial Corporations Act and all that other regulatory interventionist gobbledegook that it promised us during the election campaign was the solution to all our problems in this area. I hope for the sake of the Australian financial system and for the sake of the availability of money for housing in Australia that what comes out of the Martin review of the Campbell report is a sharp reminder to the Labor Government of the reality of market forces in our financial system and indeed in the whole of our economy. If it is the decision of the Government to recant on some of the promises that it made in this area before the election, I will be the first to congratulate it and I will be the first to say that it is adopting the right course of action. I hope that the appointment of the Martin Committee in this area is a signal that the Labor Party is seeing the sense of adopting a different stance in this area. When we look at the policy of the Labor Party in the housing area and compare it with what is embodied in the measure now before the House and look at what happened before, we see a very clear pattern of repudiation. We were promised in no uncertain terms that the housing interest rebate would be maintained. Mr Hawke went around the country saying: 'Trust me. I will keep that housing interest rebate'. What happens? Within six months the Minister for Housing and Construction takes both of them away and says: 'Don't worry. Everything is going nicely. Trust me. I am taking them away but somehow or other you are not going to be any worse off'. What else does he do? Having breached that promise, he takes hundreds of millions of dollars away from private home ownership and transfers it to the public housing sector. Once again we have a clear breach. One is entitled to ask: What is the Labor Party's housing policy? Where does the Labor Party stand in this area? Does it stand for the optimum level of private home ownership? Does it honour what many people in this community thought was a bipartisan objective in the housing area; that is, optimum private home ownership? Or does it stand for a housing policy which seeks to rely more and more upon public sector housing? I do not cavil at the fact that public sector housing should receive a certain amount of government assistance, and I think people struggling with rental accommodation in some of our major cities in present circumstances are going through very difficult times. In a number of areas I support the initiatives and measures that have been taken by the Government. But nothing can hide the fact that year after year while we were in government we were told by the Australian Labor Party that the answer to all of our problems in the housing interest area was twofold. We were told, firstly, that we had to regulate and control interest rates more than they were being controlled at the time and, secondly, we had to provide tax relief for mortgage payments. As far as the first proposition is concerned, I have demonstrated that the policies advanced by the Labor Party on that were wrong; that in fact regulation reduces the flow of funds into housing, not increases it . Secondly, the Labor Party has clearly and unambiguously broken the promise it made before the last election about the deductibility of housing interest payments. That joins a long list of specifically and clearly repudiated promises of the Labor Party. I say to the honourable gentleman and to those sitting behind him that he and they will be reminded of that broken promise every time there is a debate on housing in the Parliament. I can think of few examples where there has been such a clear gap between the rhetoric of a party when in opposition and its delivery and performance when in government. Year after year we were told that the answer to this problem was to make all such interest deductible. Last year, when we did something about it in a responsible manner, we were told that it was not enough, that it was too late and would not benefit enough families. When in August, in the Budget, we moved again to provide some help, we were once again told by the then Leader of the Opposition that we were not going far enough. We were served up with an election policy speech that promised the earth. It said that the Labor Party would maintain the assistance given by the former Government and throw in a whole lot more goodies for good measure. Yet within six months-it is almost six months to the day since the Labour Party was elected to Government-it has achieved the remarkable feat in the housing area, which is so close to the hearts of millions of Australians and their families, of tearing up not only its pre-election policy but also the rhetoric of the preceding five of six years that went into the preparation of that pre-election policy. This legislation represents a clear and shameful repudiation of an election commitment to keep a tax benefit for hundreds of thousands of ordinary Australian families. It was given without any sense of responsibility and has been taken away without any sense of concern for those it affects. Mr CUNNINGHAM(McMillan)(9.17) —It was interesting to hear the comments just presented to the House by the former Treasurer, the honourable member for Bennelong (Mr Howard). In his 20 minutes he failed even to address himself to the actual Bill before the House and attempted to put across the message that this was another allegedly broken commitment of the Labor Government. He tried to tell us that we had been saying that the previous Government's measures were too little, too late and for too few families. He claimed that the actions of the Labor Government are affecting adversely lots of people across Australia; that we have deceived those families. Let us look at the facts. Firstly, the Australian public will be well aware that the honourable member for Bennelong, the former Treasurer, deceived the Australian public prior to the election. He clearly deceived it as to the very important projected Budget deficit figures. Yet tonight he tries to tell us that Labor has broken some commitment. The Australian people judged the former Government's performance. If Opposition members look across the chamber they will see the many seats filled on this side compared with the very few filled on their side. They should then quickly realise that the sort of approach that is taken by the honourable member for Bennelong is old hat and the public will not believe it. The real deception came from the very person who has just spoken, the honourable member for Bennelong. He did not tell the people the truth about the amount of deficit that they would have to face. He did not tell us how he would have overcome these problems if he had been re-elected. At least we realised in the last week of the election campaign that the public had been deceived. The message given to the Australian public was that because of this deception we would have to make adjustments to some of the policies that we had formed. That is quite clear when one goes through the matters that have been raised in this debate today. We still have the honourable member for Bennelong talking about freeing up markets and freeing up interest rates. The only sure thing about the policy that was adopted by the previous Government was that it had given up any commitment to get interest rates down to 10 per cent. That was the clear indication it gave to the Australian people. The scheme it brought in offered people-very wealthy people, of course-a rebate of up to $60,000. Honourable members opposite admitted that they could not get interest rates down to 10 per cent and that they would have to subsidise interest rates above 10 per cent. That was a clear indication that they had no policy. They admitted it to the Australian people. They said: 'Elect us again and we will continue the high interest rates'. It was a quite simple proposition . We have said to the Australian people-we are acting upon this-that we will get the economy going again and get interest rates back down so that the former Government's policy will be null and void. There is no need for the former Government's policy. We have replaced it with a policy which is effective for the Australian public. Let me get back to the general outline of the legislation before the House. The Income Tax Assessment Amendment Bill is designed to amend the tax laws to give effect to one of the decisions announced by the Treasurer (Mr Keating) on 19 May . Announcements were made at that stage also by the Minister for Housing and Construction (Mr Hurford) in relation to our housing policy. There are to be no new entrants after 30 September 1983 to the tax rebate scheme for home loan interest payments by first home buyers and beneficiaries of the scheme after that date are to be subject to an income test. This is clearly a change of priority and a change of direction- a changed endorsed by the Australian public at the election. The Bill will amend the provisions of the income tax law which allow a rebate of tax for home loan interest payments during the first five years of occupancy of a taxpayer's sole or principal residence. It is very important that the public should be well aware of the effect of the amendments. There will be no new entrants to the rebate scheme after 30 September 1983, subject to some transitional measures. The entitlement to a rebate after that date will be subject to an income test. At present the rebate is 30c in the dollar of qualifying interest, subject to an upper limit of $500 in the first full year of occupancy, reducing by $100 a year during the following four years. The upper limit is increased by $200 where the dwelling is also the home of a dependent child or student dependent of the taxpayer. This increase is available on a pro rata basis if the dwelling is the home of the dependant for only part of the year. Broadly, the Bill proposes that taxpayers who qualify under the rebate scheme on or before 30 September 1983-that is, those who have first occupied a dwelling as their sole or principal residence on or after 1 July 1977 or on or before 30 September 1983-will continue to receive the benefits of the existing scheme, but subject to the operation of an income test. The income test will apply in such a way that benefits under the scheme after 30 September 1983 will be available in full to taxpayers whose family incomes in the 1982-83 income year is $24,300 or less, shading out proportionately for family incomes up to $27,900. No rebate will be available after 30 September to a taxpayer whose family income is $27, 900 or greater. The income to be taken into account for the purpose of the income test will be the combined 1982-83 taxable income of the taxpayer and the person, if any, who is his or her spouse on 1 October 1983. There are some extenuating circumstances that will allow some adjustments even in that case. For the 1983-84 year of income only the rebate entitlement attributable to the period after 30 September 1983 is to be income tested. The rebate otherwise available for the whole year in accordance with the existing law will be apportioned over the periods up to and after 30 September 1983 on the basis of the number of whole months in each of those two periods during which the taxpayer is an owner occupier of a dwelling which is his or her sole principal residence and in respect of which rebatable interest is paid. It is very important that this message is made clear to the public so that there is no confusion as to what the real situation is when this legislation is passed. The Bill extends the operation of the provisions to taxpayers who, although they enter the rebate scheme by taking up occupation of a dwelling after 30 September 1983, have contracted to acquire or build or commence to build on or before that date the dwelling they will ultimately occupy. This transitional measure will protect those first home buyers who will not be eligible under the proposed system of income tested periodic cash payments to first home buyers who contract to purchase or build their principal residence on or after 1 October 1983. Because of differences in the tests which must be satisfied under the two schemes, some first home buyers would not, without this extension, be entitled to the benefits of either scheme. Hence the reason for the legislation. Where such a taxpayer comes within the rebate scheme, the income test will apply to the combined 1982-83 taxable income of the taxpayer and the person, if any, who is his or her spouse on the day the dwelling is occupied. Mr Hodgman —You still broke promises. Mr CUNNINGHAM —It is very important to understand why the honourable member for Bennelong did not address himself to the legislation and tried to work on the idea that this Government had broken a commitment. Mr Hodgman —You have. Mr CUNNINGHAM —The honourable member for Denison is interjecting about broken promises. I do not know how honourable members opposite can sit there and talk about broken promises after the deception which they perpetrated in this country prior to the election. The people of Australia decided to put them on the Opposition benches. They should not interject and tell us that we broke promises . We have to readjust to reality. Madam Deputy Speaker, I now turn to a few points relating to the new scheme which will be introduced by the Labor Government. The first home owners scheme or the FHOS as it is called, will replace the home deposit assistance scheme from 1 October 1983. The scheme has been designed for special reasons. It has been designed to provide equity and uniform treatment as widely as possible between applicants. It has not been designed to create a special section of people in the community who are treated better than anybody else. It is designed to help those who really need help. It has been designed to weigh the benefits of eligibility criteria against costs to ensure that a majority of applicants are not put to inconvenience or processing delayed merely to apply a test which will relate to only a small number of applicants. It is also designed to be workable, simple to understand and to meet the reasonable requirements of lenders and of the housing industry. I now outline the objectives of the scheme. These are as follows: To help people achieve greater capacity to borrow the necessary funds to build their first home; to aid those low income families who cannot bridge the deposit gap and thus have difficulty qualifying for a loan; and to provide assistance with repayments during those difficult first five years of home ownership. That is the really important part of this scheme. It will help to regenerate the building industry. It will help young people get into the housing market. They could not get into it before unless they put money in the bank and became eligible under the previous Government's assistance scheme. That reasoning by the former Government seemed to be based on the premise that public funds should be spent right across the board. I did not understand that reasoning. At the same time as the former Government was telling us that public expenditure had to be reduced it seemed to take clear action to spend money on people who did not need it. There is no logic in that approach. This Government will not take that approach. We have been in office only for six months but we have done more in that time to restructure this country than the former Government did in the six or seven years since it hijacked its way on to the Government benches in 1975. Another objective of the scheme is to stimulate demand, thereby increasing general employment, particularly in the building and related industries. One does not have to go far around Australia at the moment to see how that policy is already taking effect. A lot of work has been generated in the building industry . When this legislation is enacted and the new scheme commences there will be an increase in the capacity of the building industry to build more homes. In the last year of the former Government only 106,000 dwellings were built. That is its record. Mr Charles —No. Mr TUCKEY —Well, if I am not, I ask the honourable member to keep quiet. The situation is that this is taxation by stealth and, of course, it is discriminatory. When we look at the Budget Papers we see that last year taxation on telecommunications amount to $560m and this year will amount to $741m in round figures. From those figures I presume it is reasonable to take $24.255m as being what the Government proposes to collect from the sale of Aussat Pty Ltd equity capital, if it has not changed its mind on that. We are looking at an increase of $156m in the taxes that are levied in this area. Of course, the bulk of that is the $100m that was picked up from Telecom in the mini-Budget. At that time the Treasurer (Mr Keating) said: 'Do not worry about it; it is one of these minor matters. Anyhow, it is a tax on Telecom. Telecom is hugely profitable; it does not charge people much'. He is at least honest enough to tell us as an illustration that in a full year the additional intered charge could be met by a 1c increase in the cost of a local call-the Isaccs call-a commensurate increase in short and medium distance STD charges and a $10 increase in the annual telephone rental fee; in other words, about 10 per cent all round. So that dollar a minute STD call that many people in the electorate of O'Connor are obliged to make but which people in the electorate of Isaacs are not nearly so frequently obliged to make will go up to $1.10. That is the sort of discriminatory burden that is being imposed by this legislation. If one lives in Isaacs, if one gets one's votes in Osaacs, what is 1c a call or 10c a minute? That is the difference, and that is what we are talking about. The facts of the situation are completely different from the low key, smooth and slinky approach of those Bills. They are the types of Bills that could crawl under the carpet in this chamber without a bump. I have indicated to some extent the people who will pay in these circumstances. They will be the consumers, particularly in relation to the charge on television stations. I was a bit interested in some of the words of the honourable member for Isaacs. Two words seem to be climing out of the Government benches time and time again. Honourable members opposite like to use the phrase 'in a clear and co-ordinated fashion'. You cannot convince us; you must be trying to convince yourselves. It is unbelievable. You say it and the Prime Minister (Mr Hawke) says it. If you keep telling yourselves you will believe it as you believe in many of your other fibs but you will not be clear and co-ordinated because- Mr DEPUTY SPEAKER(Mr Mildren) —Order! If you wish to have a private discussion you can have it afterwards outside; otherwise direct you comments through the Chair. Mr TUCKEY —Thank you, Mr Deputy Speaker. I will do that. For your information, another comment of the honourable member for Isaacs was that the Government made a firm decision about Aussat. That would have to be the greatest joke I have heard in a long time. The firm decisions were made about Aussat. It was only the Government's procrastincation and its supporters coming froward with all their issues and pork barrels, wanting to get a piece of the action, that threw the whole thing back into the pork barrel. The previous Government had a firm and clear position from Aussat. We knew where we were going with it. It took another firm decision of this Government to get it back on the track that it was on before. We are still to know whether it is to be put under the control of Telecom so that we have all of Australia's major inter-city communications under one union so that that union can turn Australia on and turn Australia off. Mr Robert Brown —Disgraceful. Mr CUNNINGHAM —That is an absolutely disgraceful performance. Yet the honourable member for Bennelong stood up in this House for 20 minutes and told us how we have broken promises. Let us look at what this will really do. About 50,000 people will be eligible during 1983-84 to receive non-repayable grants under this new first home owners scheme. I repeat that 50,000 people will be eligible in the first year. This is an increase in assistance of some 40 per cent since 1982-83. The introduction of this scheme is evidence of the Government's firm commitment to give housing a high priority and to target assistance to the lower and middle income groups who need it most. The new scheme will replace the home deposit assistance scheme and the first home buyers tax rebate scheme which was introduced by the previous Government. The new single scheme will be more effective and better directed to lower and middle income families and will be more easily understood by the public. The rhetoric of the honourable member for Bennelong in the House tonight, if people are foolish enough to believe him, will serve only to disrupt and deceive the people as to what this Government is all about in the new housing scheme. We are not in the habit of spending money where it is not needed. The job before governments in Australia at present is clearly to get the economy going. To do that we have to spend money where it will have the most effect-that is, we must put the money where the people will use it and not where people will use it to add to their savings. There is not much point in using public funds if those funds are just going to go into the bank and be borrowed at interest rates of 16 and 17 per cent, which was the case when the previous Government was in charge. It tried to get tax rebates and to recycle the money. It achieved 106,000 home starts in 1982-83. That is not much of a performance on which that Government can stand up and be counted. I repeat that under this new first home owners scheme eligible first home buyers who buy on or after 1 October will have a choice as to the form of assistance they will receive. I hope that all the people listening tonight clearly understand this. First home buyers with two or more dependent children will be eligible for a subsidy of up to $7,000 over five years or a lump sum payment at the time of purchase with smaller subsidy payments over the first five years of home ownership. First home buyers with one dependent child will be eligible for a subsidy of up to $6,500 over five years or a lump sum payment at the time of purchase with smaller subsidy payments over the first five years of home ownership. First home buyers without dependent children will be eligible for a subsidy of up to $5,000 over five years or a lump sum payment at the time of purchase with smaller subsidy payments over the first five years of their home ownership. Applicants will have three options as to the amount of lump sum and subsidy. The subsidy will be paid monthly over a five-year period. Assistance provided under the new scheme will be a major boost to the prospects of lower income families struggling to buy a first home at a time of economic difficulty. The assistance will be available at the time of purchase and will assist many home buyers in obtaining a larger loan to bridge the deposit gap. It will restore home buyer confidence and provide a much needed stimulus to the house building industry, which has been depressed for some time. The Goverment also will begin a publicity campaign focusing on the new scheme just before it begins on 1 October. The publicity will be designed to ensure that all eligible first home buyers are made aware of their entitlements under the new scheme and how to apply. In concluding let me make a couple of points. One is that with prudent, economic management we can look forward to interest rates in this country falling. We can reverse that decision taken by the previous government. It virtually declared that it could not lower interest rates and brought in a subsidy scheme for interest rates over 10 per cent rather than attack the real problem and bring interest rates down to 10 per cent which would have assisted those who needed help. I solidly support the legislation the Minister has brought into this House. I look forward to its passage and to the new scheme coming into operation on 1 October. The decision of the Australian public at the last election will be vindicated by better government, better home building and a lot more homes being constructed in this country. Mr CADMAN(Mitchell)(9.35) —It is fascinating to hear the Australian Labor Party try to justify some of the terrible decisions it has made and which affect 70 per cent of Australian families. Those families are Australia's home buyers. They have lost a great benefit and it was not within six months, it was within a few weeks of this Government coming to office that the Treasurer (Mr Keating) made the announcement on 19 May that home rebates, the subsidy for interest rates, would be scrapped. That abolition of the income tax rebate for interests in the first year will save the Government $80m and in a full year $395m. The incredible thing is that the Government has presented this decision as an advantage to Australian home owners. The removal of the tax rebate represents another broken promise. It ranks with the types of promises which were broken just after the National Economic Summit Conference when the Prime Minister (Mr Hawke) gave assurances that there would not be lump sum taxes for people who were retiring. He told many representatives of the union movement and the assembly at large that he would not be taxing lump sums on rebate and here is another broken promise. Mr Howard —Barry Unsworth knows about this. Mr CADMAN —Barry Unsworth could tell the story. Barry Unsworth is still fighting this measure and Barry Unsworth will win it because it shows the hypocrisy of announcements made prior to the election. The tax rebate on home interest rates is another broken promise. Throughout the election campaign the Minister for Housing and Construction (Mr Hurford) who is at the table, the Prime Minister, and the Minister for Territories and Local Government (Mr Uren), went around the country saying to the Australian home buyers that the Liberal Government was not doing enough for them, that the Australian Labor Party would improve the situation and that it would increase the size of the rebate people could have when they purchased their own home. Of course, on 19 May that promise was broken . As I said, on 19 May the decision was taken to take away from the Australian home buyers $80m in this financial year and $395m in the next financial year. That came into effect from 1 July. From 1 October the Government has decided to readjust its first home buyer scheme. It was a scheme introduced by the previous Government. What it has done is take the same money and use it differently. The Government is acclaiming this as a new scheme, a more advantageous scheme, a scheme that will give more to first home buyers. In fact it takes the same money and uses it differently. There is no gross, there is no net advantage to any first home buyer in Australia. What it has done is to remove the general assistance to the home buyers in Australia and it is claiming that it can do that with the prospect of falling interest rates. I notice that the Treasurer in the Budget did not take the risk of making those predictions and if that is the assumption on which the rebate to the Australian home buyers is being removed, then I think he is running a grave risk if interest rates should happen to rise in the months ahead. The first home buyers are the ones who will be squeezed. They are the ones who will be pinched. They and their families will be the ones who will suffer. Mr Braithwaite —He is hedging his bets. Mr CADMAN —Who, the Treasurer? I would think that the Minister for Housing and Construction would be fascinated by some of the remarks made by the Treasurer at the Summit Conference. The Treasurer said: It is the central objective of the Government's economic policy to ensure that economic growth spreads through the private sector and that the recovery is therefore sustained and unemployment markedly reduced. In fact the measures we are debating tonight have the impact of taking funds from the private home buyers and redirecting those funds to the public sector. There is no commitment to foster the private sector and to encourage people to buy homes. Exactly the opposite is happening. The Treasurer made those statements and another promise is broken. This is stimulation through tax collection, through cutting benefits and through putting greater pressure on Australian families. The cost of money to home buyers is still the most important factor, and it is still the most important factor preventing people from purchasing their own homes. There is plenty of money in the market. All the lending institutions have adequate supplies of funds. They are not lending them because the borrowers cannot cover the cost of repaying those funds. One has only to check the categories of people who are borrowing to build their own homes to see that there has been a dramatic shift over the last few months from the categories that were purchasing this time last year. The people who are purchasing today comprise far more professional people, far more semi-professionals and skilled people, people who have an assured income at a high level. The average workers about whom the Australian Labor Party talks are not buying homes to the same extent today as they were 12 months ago. What the Government is doing by this measure is further discouraging the average Australian worker from purchasing his own home. If one were to look at the extra funds being allocated to public housing, I think one would suspect that, as in 1972, the ALP is saying: 'People do not need to buy their own homes or to own their own homes. What we shall do is reduce the stimulus, reduce the incentive, and redirect those funds to the public sector.' That is a traditional approach from the ALP. In 1972, the first thing it did, after making similar promises that it would retain the home savings grant scheme , was immediately to cut it. In that way, the ALP provides a deterrent to Australians who want to own their own homes. The rebate, together with other measures, is one of the reasons why this Budget, plus the 19 May decisions, is costing many average Australian families up to $16 a week. The cumulative effect of the Government's decisions is costing Australian families $16 a week. If one adds in Medicare, the cost of fuel, the cost of getting to work, the effect is even greater. Honourable members should come to the western suburbs of Sydney and find out how people manage under this Budget and the Government's decisions. The way in which the ALP treats the people it claims to represent is dreadful. In the western suburbs of Melbourne it is exactly the same. First, the ALP hits people in the pocket for buying their own homes. It promises them tax relief, which it immediately denies them. It increases the cost for them of getting to work. Then the ALP says: 'We shall charge you through your tax for your medical coverage'. The Government does not even know what that will be. So, there is the $16 a week for the average Australian family. How much they have benefited by the Government's administration! I am looking forward to the next election. We have so many issues on which the ALP has broken promises. It will go to the people next time and the people will ask: 'Which of these promises are real promises, and which are not real?' The ALP will not be able to justify its position in that regard because the people will not believe it. It will not be believed by the Australian community. I find it fascinating that linked with this rebate is the decision about changes in many other areas of Government activity. The decision to subject pensioners to an assets test will affect them in their own homes. The decision to tax lump sums is a duplicating and confusing decision when one considers assets tests. It is a redirection of resources away from- Mr Cunningham —I raise a point of order, Madam Deputy Speaker. The honourable member is wandering far and wide from the Bill. He has not yet even mentioned what the debate is all about. I think that it is time he came back to the Bill. Madam DEPUTY SPEAKER —Order! There is no point of order. Mr CADMAN —It is a money Bill, so I think I am entitled to wander a bit. Mr Braithwaite —The honourable member was talking about broken promises. Mr CADMAN —Yes, I am talking about broken promises, and about the way in which the Australian Labor Party, with a gilt-edged election campaign, has made promises and has then broken them. The most serious aspect of those broken promises is their effect on Australian home buyers and Australian families. What about Australian families? On 19 May the Government threw Australian families aside. The Government threw them on the scrapheap. I will read what the Budget says about this, the way in which it describes these measures. It says that the 'savings' following the abolition of the mortgage interest rebate scheme were estimated at $50m in 1983-84, rising to $175m in 1984-85. The Budget Papers, the Government's own documents, talk about them as 'savings'. If we try to present to the Australian community the proposition that by taking money away from it we are saving it money, we will find that it will not accept that sort of argument. It feels that if we are taking money away from it we are stealing from it because having made promises we have then taken away funds that are rightfully those of the community. Yet the Government, in its papers, calls such action a saving. With regard to first home buyers, the same term is used. The 'savings' in 1983- 84 were estimated at $30m, rising to $155m in 1984-85, and $190m in 1985-86. Again, the term 'savings' is used. That may be a Treasury point of view, but surely it is not a government's point of view. Why does the Government consistently claim that it is helping people and use the term 'savings' when it is taking money away from people? If it is saving money, as the Budget papers say, why have those savings not been given back in the form of tax cuts? Why has the Government not lived up to its commitment of giving tax cuts? It has saved money. Where has that money gone? Where are the tax cuts? Where are all the other good things that were promised during the election campaign? The Government cannot treat the Australian community in that way and expect it to forget it. If the Government says that it will save people money by taking it out of their pockets, they want to know how they are to get it back. There is not one element in the 19 May decisions or within the Budget which people would regard as beneficial. The average Australian family is anxious to improve its lot and its way of life . Owning a home is an important part of that ambition. It gives the family a stability and a sense of reason for continuity and for family attention to the details of day to day life. It gives a security to children. It provides a sense of continuity in family life for teenagers. Such a sense of continuity is essential if teenagers are to pass satisfactorily and healthily through those years. Yet the Government has tonight introduced the first piece of its promise- breaking legislation. It has introduced legislation that will take money out of the pockets of average Australian families and will not assist them in any way. In fact, the whole thrust of the Budget takes from each Australian family a sum of roughly $16 a week. It is dreadful that the Australian Labor Party can represent these measures as ones that are beneficial. It is the height of hypocrisy. The Minister at the table, despite his huffing and puffing when he found that there were three or four months during which no funds were going to the housing area, cut everything off. He did not realise that he had done it and then he had to backtrack to decide what he was to do and to make some interim arrangements for first home buyers. It is dreadful administration and similar to that which will apply to pensioners when they come to consider what their future will be when they look at their assets test. It will take them 12 months to find out just where they stand. It took Australian home buyers five months to find out where they stood after the Government made the decision. Nobody knew where they stood. The same applies to the 10 per cent withholding tax. Those to whom the tax will apply do not know where they stand. The tax at source is another area in which the Government has failed to understand the Australian community. The Government had better listen to its back bench and have its back bench hold regular meetings in which frank statements are made. The Government might even need a new Minister or two because it is short of Ministers of ability. I should think that many candidates in this chamber would adequately fit the role of the new Minister. Indeed, Mr Deputy Speaker, I suggest that if you were to take over the portfolio of housing we would see some great benefits. Whilst indeed you made some unusual decisions in the years that you were in government, you were more consistent than the current Government has proved to be because it has made promises but has failed to deliver them to Australia's home buyers. Mr BRUMBY(Bendigo)(9.50) —It is unfortunate that few of the Opposition speakers this evening have bothered to concentrate at all on the content and the purpose of the Income Tax Assessment Amendment Bill (No. 3). Their arguments, when they have touched on that content, have certainly been very scant and very specious. I find it remarkable that the honourable member for Mitchell (Mr Cadman) should have spent some 10 or 15 minutes speaking about the general conditions of the average Australian family and the supposed broken promises of this Government. If we look at the record of the previous Government, at what it did in terms of interest rates, at how it decimated the housing industry and reduced the possibility for most Australian families to buy homes, we will see that its record is disgraceful. The honourable member for Mitchell seems a little taken aback by those comments , but the record of the previous Government was deplorable. Interest rates were never higher than they were during the last months of the previous Government. We also saw massive levels of unemployment created by the previous Government. The honourable member for Mitchell talked about improving the conditions of average Australian families. I think it is fair to say that every decision that this Government has taken since 5 March has decidedly promoted the position of the average Australian family. Mr Newman —Name one thing. Mr BRUMBY —I am about to, and I am about to talk about this Bill before the House and about the new first home buyers scheme which will be introduced on 1 October. I mentioned interest rates. As was noted by the honourable member for McMillan (Mr Cunningham) in his excellent address, the lower limit for the general rebate which the previous Government operated was set at some 10 per cent. That was surely an admission of the failure of the policies operated by the previous Government. In this scheme which we have announced, which will take effect from 1 October, we will provide assistance to more than 50,000 Australian families and, most importantly, it will be targeted at those who need the assistance. Mr Deputy Speaker, I indicated that I would return to the Bill. On 19 May the Treasurer (Mr Keating) announced in the economic statement that there would be no new participants in the first home buyers tax rebate scheme after 30 September this year. The main part of this Bill before the House gives effect to that measure. Those eligible for the rebate prior to 30 September will remain entitled to a tax rebate on home loan interest payments for the first five years of ownership, subject to an income test. As has been noted by the honourable member for McMillan, the full rebate will be available to those first home owners whose taxable income in the 1982-83 financial year is less than $24 000. Above that figure the rebate entitlement will be reduced proportionately and phased out at the maximum income level of $27,900. As I have indicated, this Bill is just one aspect of a total housing package announced in the May economic statement which is designed to rationalise housing assistance programs in Australia and is designed particularly to ensure a better targeting of assistance to low and moderate income earners; that is, those most in need of housing assistance and those most forgotten by the policies of the previous Government. The initiatives and changes contained in that May package are marked by a very just concern for low income first home buyers purchasing or constructing their homes within the change over period, between the conclusion of the previous home deposit assistance scheme and the commencement of the Government's new scheme on 1 October. This Bill in its main provisions provides for those transitional arrangements. Although generally there will be no new entrants to the scheme after 30 September, first home buyers who contract to build or purchase before 30 September-in other words, those whose prescribed date is prior to 30 September-will be eligible for the rebate even though they do not take up occupancy until after 30 September. These transitional measures will give access to the rebate to first home owners who would not be eligible for assistance under the new first home owners assistance scheme to commence on 1 October. I think it is noteworthy that the Government has taken care to ensure that there is a smooth transition between the two schemes and that all low income earners are certainly not disadvantaged, because concern for low income home buyers in our community was certainly not a prominent feature of the previous Government's housing assistance schemes. The honourable member for Bennelong (Mr Howard) spoke tonight about the general tax rebate. The Government maintains that the general rebate was highly inequitable and that the great bulk of assistance went to moderate to high income earners able to take out significant loans. The rebate was set at 30.68c in the dollar for 1982-83 for interest exceeding 10 per cent on the first $60, 000 of a home loan. I have mentioned, as has the honourable member for McMillan tonight, that it is an indictment of the previous Government's economic policies that it introduced a scheme in respect of interest rates exceeding 10 per cent. I think it is worth pointing out in a general criticism of that scheme that fewer than 20 per cent of home buyers who made use of that rebate did so through pay-as-you-earn deductions. That shows that the remaining 80 per cent of people certainly did not need the rebate to meet their monthly mortgage repayments. This obviously raises the question as to whether that assistance was being directed to people in need. We have abolished that scheme from 30 June of this year. The phasing out of the income testing of the special first home buyers tax rebate certainly strengthens this Government's commitment to low income home purchasers. The rationalisation of the tax rebate scheme has enabled the Government to increase the level of assistance to low and moderate income first home buyers through the first home owners assistance scheme which will operate after 1 October. Savings from the abolition of the tax rebate in 1983-84 will be some $80m, rising to $330m in total in 1984-85. Those savings will in part be directed to the first home owners scheme. There is no question that, with the maximum grant of $7,000, the scheme will bring the Australian ideal of owning one's own home within the reach of a great deal more Australians. Certainly the Goverment has completely honoured its pre-election commitment in terms of private sector housing by introducting this scheme which makes a $7,000 contribution to first home owners. We heard some selective quotations from the honourable member for Bennelong. We certainly did say before the election that we would 'bridge the deposit gap which prohibits many moderate income earners from obtaining home ownership'. There is no question that our scheme does that. I should also add that the scheme we are introducing on 1 October also implements many of the recommendations of the Committee of Inquiry into the Australian Financial System -the Campbell Committee-in regard to home ownership. The Campbell report rejected interest rate controls as an effective measure of home ownership assistance. The report said that interest rate controls had been used for this purpose previously but with very limited success. The report noted that as there is very little scope to allow for greater risk in the interest rate charged, lenders naturally prefer those with a higher income and wealth; hence lending institutions employ income-related repayment rules which tend to disadvantage lower income earners in loan raising. Mr Sinclair —You are reading that. You ought to make your speech without reading it. Mr BRUMBY —I have not read much of my speech tonight. Mr Sinclair —It is about time you stopped reading it. Mr BRUMBY —I thank the right honourable member for his advice. I was saying that -- Mr Sinclair —He is reading again. Mr BRUMBY —The right honourable member for New England would do well to listen to some of the remarks that have been made tonight by my colleague the honourable member for McMillan and some that I have made about the deficiencies in the policies of the previous Government. Already tonight we have heard that under the previous Government's programs construction of new houses fell this year to 106,000; interest rates were the highest ever in our history for borrowers who wanted to buy their own homes; and the inflation rate and other factors affecting home ownership reached such a level, as I have said, that very few Australians were able to purchase their homes. Our scheme, which will be introduced on 1 October, provides benefits to genuine low and moderate income families. As I indicated, the Campbell report recommended that in the interests of an efficient financial system home ownership assistance should be directed towards providing tied cash grants to eligible purchasers to assist them to bridge the deposit gap. There is no question that our first home owner assistance scheme, which will be introduced on 1 October, will do precisely that. It has, of course , been argued that such a direct cash grant scheme discriminates against low income home renters who are far from being in a position of purchasing homes but who, nevertheless, share the tax cost of the scheme without enjoying any of the benefits. However, the Labor Government has acted to meet that need by extending supplementary rent assistance of up to $10 a week to all social security beneficiaries, including the unemployed, as announced in the recent Budget statement, and by boosting funds to public housing by a massive 50 per cent. There is no doubt that a positive response to the Government's housing package has been unanimous throughout the public and private sectors. The Housing Industry Association, building societies and welfare housing agencies have all expressed their unqualified support for Labor's equitable housing policies. Throughout my electorate of Bendigo the response has been similarly enthusiastic and widespread, particularly amongst low to moderate income earning families who have never had an opportunity to buy houses with this sort of assistance. Consistently, the Government has at all levels sought to enhance the quality and availability of housing for all Australians, particularly those at the lower end of the income scale. Changes to the special tax rebate for first home buyers, to be given effect tonight by the Income Tax Assessment Amendment Bill (No. 3) are just one strand of the Government's unquestionably fair and very positive housing policies. I certainly commend the Bill to the House. Mr HURFORD(Adelaide-Minister for Housing and Construction and Minister Assisting the Treasurer)(10.00) —in reply-In closing the second reading debate I thank all right honourable members who took part, except the Deputy Leader of the National Party, the honourable member for New England (Mr Sinclair) who interjected in a disorderly fashion during his temporary stay in the House. In particular, I pay tribute to the honourable member for McMillan (Mr Cunningham) and the honourable member for Bendigo (Mr Brumby) for their excellent contributions. Following discussions at the National Economic Summit Conference, the Government took steps to ensure that housing will play a leading part in economic recovery in this country. Our plan is directed to people buying their first homes. It is a plan which is income tested and targeted to those who are in the greatest need. I will have great pleasure in introducing to the Parliament tomorrow night the First Home Owners Bill 1983 which will display how the Government intends to use housing in order to get the economy going. Of course, a major part of our plan is the proposal to pay from 1 October a new cash subsidy and this is contained in the First Home Owners Bill. The Income Tax Assessment Amendment Bill (No. 3) will continue the existing rebate for first home buyers but one would not know that from any of the contributions from honourable members opposite. The honourable member for Bendigo and the honourable member for McMillan mentioned that the rebate will continue. This targeted proposal does not end with the Income Tax Assessment Amendment Bill (No. 3). The rebate will go to those in greatest need-the new first home buyers who are within the means test. The income test on the tax rebate will mean that eligible families with a taxable income in 1982-83 of $24,300 or less, which is 135 per cent of average weekly earnings, will receive the rebate in full. The rebate benefit will shade out in the income range $24,300 to $27,900, which is 155 per cent of average weekly earnings. Honourable members will realise that the rebate can be up to $700 in the first full year of home ownership or $500 per annum if there are no children. It shades out over the following few years. So it does not end with this Bill at all. It goes to those in greatest need. The proof of the pudding is in the eating. The fact is that the proposals that have been introduced by the Labor Government in the last six months have meant a revival of the housing industry. We have also moved to protect those home buyers who might not have been eligible for either the tax rebate or the new cash subsidy. Those who contract to buy or build on or before 30 September will be eligible for the tax rebate from the time they occupy their homes if they are not eligible for the cash subsidy we will be introducing from 1 October. Our total housing package will- indeed it has already because of the expectation that has been aroused-stimulate home building in a responsible way. It will generate at least 25,000 additional jobs directly in the building industry, and other jobs will be created in the materials supply and consumer industries associated with housing. The new cash subsidy will be a better directed scheme. It is better presented. It is going to the lending institutions, enabling them to lend more. It is getting enormous support from the Housing Industry Association, the Master Builders Association, the banks, the building societies and all of those who are involved in this great industry. Recovery in the United States is coming from the housing and construction area. We mean that to happen in Australia. It is already happening because of the better policies of this Labor Government. The Bill will ensure that the lower income first home buyers who entered into home ownership at the time of high interest rates will continue to receive assistance to the end of their fifth year of first home ownership. We are pleased that that is so. We are pleased that we are able to introduce better measures for those entering into home ownership from now on. Once again, I thank honourable members, in particular honourable members from this side of the House, who took part in what has been an interesting debate. Question resolved in the affirmative. Bill read a second time. Leave granted for third reading to be moved forthwith. Bill (on motion by Mr Hurford) read a third time. Debate resumed from 23 August, on motion by Mr Dawkins: That the Bill be now read a second time. Mr MOORE(Ryan)(10.10) —I thank the Government Whip and the Leader of the House (Mr Lionel Bowen) for their assistance in the timing of this debate. The purpose of Loan Bill (No. 2) 1983 is to authorise the Government to raise borrowings to meet the deficit resulting from the Budget. I thought that tonight, rather than discuss the matter in a political sense, I might attempt to review the way in which loan raisings are handled in the Australian capital markets. It is worth starting from the point of Keynesian economics, which have been so distorted by politicians over the decades in relation to deficit financing, and the converse of running Budget surpluses in times of high economic activity. All too frequently I have noticed that governments have been very willing to run deficits but have shown a complete disregard for the converse of Keynesian economics-running a surplus in times of high economic activity and reducing national commitments. In so doing governments have been forced into relying on the printing of money or substantial government borrowings. Because of that we now have enormous pressure on the Australian capital market brought about by debt raisings, not only in terms of the Australian Federal Government but also right through the State and local government spheres. The history of the Australian money market is very brief. I think it is only a matter of 20 years since nine members started the Reserve Bank of Australia as a lender of last resort. Because of the market's remarkably small size the growth in government debt has been terribly significant. The total proposition has been as to how the market could handle the mustering of Australian domestic corporate savings for use by the public sector. This brought about an enormous change in the style of marketing of government securities over those years. The sale of government bonds first took place across the counter of the Commonwealth Bank of Australia acting as agent for the Reserve Bank. There was no limit on the number of bonds, just a fixed interest rate. Because of the position, strength and size of the government sector most of the operators in the short term money market were completely dependent on the bids coming from the Reserve Bank in that sense . So the open-window policy rapidly fell into disregard. As a consequence, and because of the development of a number of new merchant banks and operators in the area, the tender system which we have today was developed. Because of the sheer size of the approaches made to the market- $1, 000m in May, $1,500m recently and $1,000m before that-we now have a problem as to how the bonds can best be marketed. Are they to be called for in terms of tenders of that size, which possibly only five, six or seven major groups within the Australian capital market today can meet or are we to look at the consequences of some wider application of the tender system? At present, with the substantial approaches that have been made to the market, we note that tenderers have forced the price to a level which is more competitive than the open market would produce. In other words, the smaller number of tenderers have kept their prices at a level which has given them a substantial margin when it comes to the retailing of those Commonwealth bonds on the Australian market. This will inevitably add substantially to the interest cost to the Federal Government. One is dealing in very substantial amounts of money. I would therefore like to canvass the possibility of studying how we can best approach the market in regard to these sums and get the result which the nation ought to require. Those honourable members who may have an interest in this matter will have noticed that an attempt to sell this quantity of paper requires an understanding of the psychology of the market-place. There is no doubt that the first tender, of $1,000m in May, was well received by the financial markets, which were looking for a lead from the new socialist Government. They were not at all sure what they were going to get. They did not know whether there would be another Whitlam spend-up, grab-bag sort of dish it up policy. Indeed, the approach of a tender of $1,000m did show that the Government would embrace a tight monetary policy and stop the usual slop that was evident in the Whitlam days. That bond issue was taken up with great ease. As we have gone down the track there has been a tendency on the part of the capital market to look at the proposed tenders and say: 'How much will it be this time? Look at the size of the deficit; how much are we going to dig up? What are the likely competitive positions in relation to it?' In other words, the market asks what commercial demand there will be for money. As the corporate sector at the moment is substantially depleted in its requirements it has been largely out of it but, at the same time, domestic savings have been substantially increased. Savings accounts are up and building society accounts are up. Therefore, it has been necessary and it will be necessary to try to harvest that money. How can this best be done? I suggest to the House that it ought to look at accepting the principle of underwriting. By doing this it would offer the issue to an underwriter who would take it at a fixed amount and would then go to the market and sell it. Honourable members might ask: What is the advantage of that course over going to tender? The advantage lies in the way in which the Telecom bonds or semi-government issues have been handled. They have been taken in an underwritten form and then marketed not just to institutions but right throughout the community. Advertisements have even been placed in the Australian Women's Weekly. There has been great success in getting the small investor to buy the stock. If the Government is to continue not only this year but also next year, as is quite evident from the Budget Papers, to sell substantial amounts of deficit bonds within the private sector to mop up the savings which will not be used because of the slackness within the corporate sector, I suggest that a very sharp eye be kept on this particular approach. It will be surer, cheaper and far more effective in getting the Australian Government paper around the community, not just to the institutions. It is the community which holds the money because it is the consumer who is not spending money and who is saving money these days. Therefore, I urge the Government to approach this matter with some particular care. It is a matter that needs judgment. It is not possible to handle the Australian capital markets without judgment. It is no good saying that because $ 1,000m went off it is all easy going. It is not; it will require handling. Finally, I wish to extend my argument. For a long time we have underwritten our overseas loans through a syndicate generally headed by Morgan Stanley or, in recent times, one of the Japanese banks. I urge the Treasury to look more carefully at this procedure and to look at the history of the development the banking systems of some of the smaller countries, financially, over the years. I refer to the Canadians. Canada was in no better position than Australia in the 1950s and 1960s. However, the Canadian Treasury insisted that the domestic underwriters be included in the underwriting syndicates that are taken on to raise Government securities outside the Dominion. As a consequence, there are some very substantial underwriting firms in that country. The firm of Wood Grundy is the one I had in mind. In the 1950s it was no bigger than the average Australian share broker but today it is a significant force in world underwriting. The Australian underwriters ought to be guaranteed a position within the international underwriting syndicates. They should not be sold the line which has so frequently been sold by the major underwriters around the world. They have said to me personally and I have no doubt they have said to many others: 'Of course, if we put in an Australian, who are they going to sell it to?' That is a plausible argument if one happens to be the leader of the syndicate. It is not a plausible argument if the weights are put on the Australian to perform. These days, given the widespread operations of the Australian merchant banks and brokers in London, New York and other places, they are nearly as well positioned-not as well but nearly as well-as some of the established people. Unless Australians are given a go in this context they certainly will never be able to match them in view of the enormous competition that is coming into this country with the foreign banks. I am sure that we all hope to see this achieved. With those few comments, I conclude. Mr BRUMBY(Bendigo)(10.22) —Honourable members would be aware that expenditure from the Consolidated Revenue Fund cannot validly exceed the revenues available to it and that, in order to avoid obtaining approval for additional borrowing through the Australian Loan Council, successive governments have, over a period of years, introduced legislation in the form of a Loan Bill to provide for the financing of the Budget deficit. This Bill makes provision for the financing of the prospective 1983-84 deficit. I take this opportunity to make some general observations on the fiscal and economic policy pursued by this Government, and particularly on the Budget of 23 August as detailed by the Treasurer (Mr Keating ). When this Government came to office on 5 March I think we were all aware that almost three-quarters of a million Australians were out of work. Unemployment had risen by more than 260,000 during the previous 12 months, and certainly our inflation rate of 11.5 per cent was twice the average of the countries of the Organisation for Economic Co-operation and Development. There is no question that the very miserable 'fight inflation first' policies of the previous Government not only failed to reduce Australia's inflation rate but also bankrupted many of our industries, relegated hundreds of thousands of Australians to the poverty and indignity of unemployment and left our families and our youth without hope or economic security. By February of this year, just one month before the change of office on 5 March, the number of jobless in my electorate of Bendigo had reached alarming levels. Official statistics show that in the shire of Bet Bet unemployment had reached more than 27 per cent; in the shire of McIvor 16 per cent; in the borough of Eagle Hawk 13.9 per cent; and in Bendigo itself, some 11 per cent. On 5 March our Government received a very clear and overwhelming mandate to get this country back to work, to restore economic growth and to deal simultaneously with those problems of inflation and unemployment. Since that date the Government has worked tirelessly and with determination to honour that mandate. The Budget of 23 August, to which this Bill is related, follows the National Economic Summit Conference, the May Economic Statement and the recent Premiers Conference. Our Budget provides the maximum fiscal stimulus to the economy without fuelling excessive inflation or placing undue burdens on interest rates or balance of payments problems. It is a Budget which very decidedly offers new hope for the unemployed and help for the needy. Nine hundred and fifty-eight million dollars will be spend on employment generation and training programs. That is an increase of 80 per cent on last year. The Government expects that to result in employment or training opportunities for some 300,000 Australians. Recovery will be led by the construction industry, with increased assistance to first home buyers and increased funding for public housing resulting in another 30,000 jobs. Additional employment stimulation will also come from the 16 per cent increase in civil works expenditure and a 22 per cent increase in direct capital expenditure. But our Budget is also directed very much to help those in need. Over the past seven years the real income of unemployed people has been allowed to decline, forcing many below the poverty line and adding real suffering to that indignity of unemployment. This Government is committed to progressively improve the position and lot of all disadvantaged Australians. Single unemployment benefits will rise progressively by a total of $14 a week and will be indexed to guard against erosion of the real value of the benefit. The first increase will be in November of this year and the second in May of next year. Married benefits are already indexed and are expected to rise by approximately 16 per cent to almost $150 weekly. Unemployment rates for 18-year-olds will rise by $5 a week in November and the limit on earnings for all unemployment beneficiaries has been doubled to $20 a week. Our first Budget also provides help for first home buyers and assistance to industry. The first home owner's assistance scheme, the subject of debate tonight, will give eligible first home buyers a non-repayable tax free grant of up to $7,000. It is a scheme which will genuinely assist Australians wishing to buy their first home. That assistance is tied to an income test. Our Government has abolished the very unfair and iniquitous previous savings test of the former Government. Our Budget also allows for assistance to industry totalling in excess of $1,100m, including a doubling of grants under the rural assistance scheme, aid for the steel industry and $12.5m in capital instalments for the Australian Industries Development Commission. Mr Speaker, as I have indicated previously this Bill in general terms provides for the funding and financing of the 1983-84 Budget deficit. In this Budget the Government has both honoured its commitment to responsible economic and fiscal management and at the same time has provided the maximum possible stimulus to the economy. There is no question that our Government is well on the way to achieving its objective of creating 500,000 jobs over the next three years. I certainly commend this Bill, which provides for deficit funding, to the House. Question resolved in the affirmative. Bill read a second time. Message from the Governor-General recommending appropriation announced. Leave granted for third reading to be moved forthwith. Bill (on motion by Mr Hurford) read a third time. Mr SPEAKER —Earlier today the Deputy Leader of the National Party, the right honourable member for New England (Mr Sinclair), raised a matter of privilege. I informed the House that I would consider the matter and make a statement to the House later in the day. In raising the matter the right honourable gentleman referred to an article published in today's issue of the Sydney Daily Telegraph and to a letter from the Attorney-General (Senator Gareth Evans) to the Prime Minister (Mr Hawke) dated 29 August 1983 and asked two questions. I intend to deal separately with each of these issues. The first question dealt with the Daily Telegraph article which appeared under the heading 'Speaker Probes Spy in MP Drama'. The article went on to allege that an Australian Security Intelligence Organisation agent is under investigation by me to determine whether he is in contempt of Parliament. In doing so it referred to a published transcript of certain in camera evidence given before the Royal Commission on Australia's Security and Intelligence Agencies. The facts are these: On the afternoon of Sunday, 4 September, I was phoned at my home by a member of this House who expressed concern regarding evidence given before the Royal Commission. The evidence in question referred to ASIO surveillance of a member of parliament, particularly with reference to association with Valeriy Ivanov, the expelled Russian diplomat. The honourable member could have been the person concerned in that evidence and raised with me the general question of breach of privilege and sought advice on the courses that were open. I advised the honourable member that I had not studied the news items or the transcript but that when in Canberra the next day I would consider them and advise the honourable member further. During the course of Monday a journalist, Mr Bob Chisholm, approached a member of my personal staff stating that he had been informed that a Member of Parliament had referred certain matters arising before the Royal Commission to the Speaker. The staff member replied that a Member of Parliament had referred matters and these were being considered. Later the honourable member who raised the matter with me was advised by me that if it were to be pursued further it should be raised in the usual way in this House. Honourable members will be aware that no complaint has been raised in respect of the matter and I can inform the House that I am not pursuing any investigations into it. Should it be raised at some future time I will then consider the matter in accordance with the precedents of this House. The second question asked by the right honourable gentleman was in respect of a letter written by the Attorney-General to the Prime Minister, dated 29 August last. The letter apparently conveyed an opinion by the Attorney-General in respect of the possible prosecution of the honourable member for Port Adelaide ( Mr Young) in respect of matters currently being investigated by the Royal Commission on Australia's Security and Intelligence Agencies. This matter is not one which comes within the responsibility of the Speaker. The question of any prosecution or other actions in matters affecting national security is entirely one for the Government. A member of this House is protected in respect of his normal privileges in the Parliament, the principal privilege being his right of freedom of speech in the Parliament, but in other respects he is in no different position to any other citizen of Australia. As I understand the law as it presently exists, a member of parliament may be subject to the same sort of inquiry by a security agency as is any other citizen of this country. Whilst I will strenuously defend the privileges of this Parliament, as I demonstrated recently before the Royal Commision, I can assure the House that in no way can I, nor will I, attempt to interfere in the normal processes of the law in respect of any member of this House. Education-New South Wales Coal Mining Industry-Community Employment Program- Burdekin Dam-Sri Lanka-Soviet Ambassador to Australia Mr SPEAKER —It being past 10.30 p.m., I propose the question: That the House do now adjourn. Mr ANTHONY(Richmond-Leader of the National Party of Australia)(10.32) —I take the opportunity tonight to raise a matter of specific concern to my electorate and to the people of northern New South Wales. I do so because the Government will very shortly have the opportunity to make a decision which could bring this grievance to an end. It is a long standing grievance of my constituents concerning secondary education in Lismore. In 1969, after years of effort, a teachers college was opened in an old school building which was built in 1902. Today there is a new college, the first part of a college of advanced education which has been built. The college is now operating in two centres which are several kilometres apart. Obviously, there are unsatisfactory features and great inefficiencies because of the distance between the centre. There is a need to try to resolve this by meeting the plans that have been drawn up for the second, third and fourth stages of the college. In northern New South Wales the population is growing rapidly. It is one of the most rapidly growing regions of New South Wales. Unlike other areas where the primary school population is declining, in the northern part of New South Wales it is rapidly increasing. By the year 2000 it is anticipated that the population will rise by another 58 per cent. It is therefore important that a decision be made as soon as possible to try to alleviate the difficulties of the college in meeting the request to fill positions and to be able to participate in the courses that have already been approved, but, because of the inadequacy of facilities and finances, it is not possible to take in as many students as the college would like. I am indebted to the Minister for Education and Youth Affairs, Senator Ryan, for her advice that the Government expects to receive the recommendation of the Tertiary Education Commission within the next few weeks. The Government will make a decision as a result of those recommendations. In the last year or so the College of Advanced Education has had a high priority but, because of the shortage of funds, moneys have not been allocated to this college. It is hoped that in 1984 moneys will be made available so that the second part of the college can be commenced. I understand the difficulties of finance, but when one realises the growing population, the difficulty of the college, and the very high level of unemployment, which is now approaching 30 per cent in this region, there is a need for public works programs to be undertaken. I cannot think of any stronger justification of the Tertiary Education Commission to make a recommendation. I certainly hope it will, and that the Government will pick up those recommendations and give them support. The college has become a principal feature of life in northern New South Wales. It has added greatly to the education opportunities and the cultural structure of the region. Because the college is situated so far away from other areas of tertiary education-the nearest is Armidale or Newcastle-I believe it warrants special consideration. At the moment there is a hiatus in that the college has to use an old building and there is a new college two or three kilometres away. It makes it very difficult to maintain the impetus that is needed in college morale. I hope that when the Minister for Education receives the recommendations of the Tertiary Education Commission she will give the Northern Rivers College of Advanced Education top priority so that it can continue its programs. Mr HOLLIS(Macarthur)(10.37) —Less than two weeks ago I made my maiden speech in this chamber, during which I concentrated on the situation of the underground coal mining industry in New South Wales. At 4 o'clock this afternoon I was informed by the management of Clutha Development Pty Ltd that it was sacking another 230 staff, deputies, miners and tradesmen from three mines in the Burragorang Valley. These sackings are a national disgrace. Clutha is wholly owned by the multinational British Petroleum Co. of Australia Ltd. The company calls itself the quiet achiever, but really it is the quiet deceiver. As I said two weeks ago, BP was permitted to contradict all Foreign Investment Review Broad guidelines by taking over 100 per cent of the Burragorang Valley mines- thanks to those who sit opposite. It is not as if BP were doing badly out of Australia. Indeed, it is doing very well. It has made hundreds of millions of dollars in profits from the oil industry and now it is moving with Western Mining Corporation Ltd into the largest uranium project in the world at Roxby Downs. The growth of the dangerous uranium industry is being financed by the sacking of underground coal miners in New South Wales. If BP had not been permitted to get into uranium it would have been more responsible in its activities in the coal mining industry, which would have protected coal miners' jobs. Australia is now paying the price of the plunder of our resources by big multinationals, who care nothing about the destruction of the local communities in my electorate. They care only about profits. British Petroleum is not and never has been a coal company. Its expertise is in oil and other fields. It has mismanaged the coal on the southern fields. It did not have marketing contacts. It lost out in negotiations though ineptitude when there was a contracting market. The workers in the valley have given away everything. They took cuts in their wages and worked shorter hours. They did this to save their jobs. Let this be a warning to other workers who are talked into giving up hard won conditions. It will not save their jobs. BP has blamed everyone but itself. It blamed the workers, the unions, the delays at Port Kembla, and the transportation policy of the New South Wales Government. Not once did it mention its lack of experience in coal and its poor mangement. Now Australia has to pay. We must stop this plunder of the underground coal mining industry. Australia must have a national energy policy. We must get the foreign multinationals out of our energy industries. What happened today in the Burragorang Valley should not have been permitted to happen, and it must not happen elsewhere in our energy fields. This can be achieved by more direct government intervention in our vital resource sector. Mr COLEMAN(Wentworth)(10.40) —The recent decision of the Government to cut government funding to certain non-government schools inevitably caused a sharp reaction in my electorate. Six out of the 15 schools on the New South Wales 'hit list' are in the electorate of Wentworth, which is probably unique in Australia in having more students at non-government schools than at Government schools, even though there are some very famous and greatly respected government schools also in the electorate. Because of this sharp public reaction, I convened a meeting recently of people concerned with the local non-government schools to discuss the development, and representatives of every non-government school in the electorate attended the meeting, not just those on the 'hit list'. The point is that everyone realises that the cuts in funding, for the moment confined to some 41 schools, are the thin end of the wedge and are meant by the Government to be the beginning of the end of the non-government schools system as we know it. This is the objective of the State Teachers Federation and it is the objective of the present Minister for Education and Youth Affairs (Senator Ryan) who once belonged to the Australian Council of State School Organisations, a council dedicated to the termination of state aid and who wrote a couple of years ago in the Sydney Morning Herald: It is with reluctance that I for one conclude that the freedom to send one's children to an independent school is bought at too high a price for the rest of society. She may have reached that view with reluctance-- Mr Hurford —Mr Speaker, I take a point of order. That report has been corrected by the Minister in a letter in today's Canberra Times. The honourable member should not be quoting something that is not correct. Mr COLEMAN —I am quoting ipsissima verba. She may have reached that view with reluctance, but reached it she emphatically has. But the people who have this objective are at present restrained by the fact that the new Government had not adopted this objective in its election campaign. Funding of non-government schools of some kind is to continue for the time being. But within that constraint much can be done at the State and Federal levels. Apart from the funding cuts, the Minister has appointed to the Commonwealth Schools Commission two men publicly opposed to state aid and has ensured that, for the first time, there is now no representative of non-government schools on the Commission. As for the State level, we see the influences on Labor policy in the 9 August issues of the Victorian Teachers Journal which contains 'the three unions position on State aid'. Referring to the State Government, it says that there must be no new registrations of independent schools, that schools already registered must not be allowed to expand to a higher year level, that there must be no new interest subsidies, that independent schools must pay payroll tax, that they must no longer enjoy the status of charitable insitutions for tax purposes and that their transport concessions must be restricted. In other words , at the State level alone much can be done to undermine non-government schools while still recognising their temporary right to some reduced form of state aid. It is in this light that I believe we should see Senator Ryan's cuts. They are not an attempt to establish a more equitable system of funding. They are meant to be the beginning of the end. The end is outlined in the recent Anderson report on the proposed Radford Anglican College in the Australian Capital Territory. It wants an integrated school system under an educational authority which would decide issues of curriculum and teaching methods uniformly for both government schools and private schools. If one joins the system, one loses one's purposes for existence. If one does not join the system, one loses all state aid . So the writing is on the Government wall. One of the unhappiest features of the whole mess is that the Government is penalising the people who can least afford the increased fees that must result from the funding cuts. The rich may grumble but they will be able to afford it. But the fact is that most parents whose children are attending these schools are not rich. Over two-thirds of the mothers are working purely to pay the fees. These are the ones who will suffer because the Government has a dogmatic hatred of parental freedom of choice in education. In a few short months the Government has broken the nexus of non- government schools with government schools. It has broken the principle that each Australian child has a right to minimum basic assistance in education. It is increasing the cost to taxpayers by forcing more children to government schools which cost the taxpayer more than non-government schools. And it has risked reviving sectarian bitterness. What an achievement-in just six months! Mr WELLS(Petrie)(10.44) —I would like to speak tonight about the community employment program particularly as it affects my State of Queensland. This excellent program which holds out hope of employment for thousands of young Australians, many of whom I represent because there is a large degree of unemployment in my electorate of Petrie, is being sabotaged by the inactivity and the fumbling incompetence of the Bjelke-Petersen Government. Mr Ian Cameron —Not true. Mr WELLS —The honourable member for Maranoa interjects in his usual fumbling inarticulate way. I would like the honourable member for Maranoa to know that back in the 1930s my father was a gun shearer out in Maranoa and he possibly even stripped wool off the sheep of the honourable member's father. If the honourable member does not watch out, I will be tearing strips of more than wool off him. At the moment in Brisbane the community employment program office is faced with the problem of large numbers of applications. I have dozens of applications for the community employment program from organisations in my electorate. But that office cannot process the applications by virtue of the fact that the Bjelke-Petersen Government has not yet made the appropriate recommendations for nominations to the advisory committee by which the money will be disbursed. It is not a tremendously difficult task for a public servant, under the authorisation of his appropriate Minister, to choose a committee of six people. This has been done in other States of Australia but not in Queensland. This caps off the degree of incompetence and delay which only the Bjelke-Petersen Government could have achieved. Back in May in this place we set things in train for the community employment program. In June multilateral meetings took place in this city between representatives of State and Commonwealth public services. Over the next five weeks there were bilateral discussions in each of the State capitals. In each State capital except Brisbane the Commonwealth officials were met by representatives of the appropriate department of industry. In Queensland they were met by-honourable members may have guessed it-representatives of the Premiers Department. Representatives of the Premiers Department in Queensland were unable to say whether Queensland would go ahead. The final meeting on this subject was scheduled for 19 July and on that date the State public servants were unable to say what the attitude of their Government would be on the question. They postponed indefinitely that meeting which was supposed to organise the community employment program for Queensland. The result of that was that nothing more happened until the very day that the once Treasurer of Quensland, Dr Llew Edwards got rolled by his Ministers and his successor, Terry White. On this occasion Llew Edwards, as one last act before meeting his maker, signed the agreement-perhaps for fear that the person who came after him would not be able to write his own name. Subsequently, nothing more has happened. It has even gone to the extent that in Brisbane State public servants who are supposed to be attending meetings with Commonwealth public servants have simply not turned up. One might even think that State public servants have been trying to avoid Commonwealth public servants. When Commonwealth public servants ring up State public servants and ask them for an appointment they are told that they cannot do anything or see them before next Thursday. Maybe they are very busy. Maybe they are watching where the axe will fall now that there is a new minority one-party Government in Queensland which has a certain aversion to any public servant who has not cringingly toed the appropriate party line for the past 20 years. One way or another my constituents are suffering. One way or another over 40 organisations in my electorate which have put in applications have not had those applications acted upon. One way or another the Commonwealth public servants in Brisbane who are trying to work out this idealistic community employment program and who want to say something in reply to people who have made application to them are unable to do so by virtue of the fact that the Bjelke-Petersen Government has not yet had the energy or the will to nominate an advisory committee. I call on that Government to do what could very simply be done. It does not take very much effort to get together a Commonwealth public servant, a State public servant, a social worker, an Aborigine, a representative of youth and a representative of women's groups. That could be done by going to any supermarket in West End. It is a very easy process. All that has to be done is to nominate a committee. Once it is nominated funds can start flowing. I urge the Bjelke-Petersen Government to stop messing around, to stop trying to sabotage this worthwhile and idealistic Federal program and to get on with the job. Mr BRAITHWAITE(Dawson)(10.49) —I welcome the very late interest, indicated at Question Time this afternoon, of the Prime Minister (Mr Hawke) in Queensland and north Queensland and in particular the Burdekin Dam. Although it was rather late , it proved one thing; that is, that the Dorothy Dix question which prompted his answer was geared to only one end-to what we have heard a little bit about tonight. It was geared to furthering the campaign against the Queensland Government. I would not mind-as I say, I welcome the intervention-if it had not been so hypocritical. It follows so closely on the attitude expressed by the Prime Minister and the Government on the Franklin Dam, for which the Prime Minister has honestly earned the reputation of a dam buster of great proportions . What concerns me most is not so much the hypocrisy but the cynical approach adopted in using a Dorothy Dixer to express a latter-day interest in the Queensland elections. It would possibly have been much better if the question had concentrated more on where the Burdekin Dam was to be located and on the Government's attitude to conservation of water and the development of the north. I just want to look at the facts. The Government has only one Minister from Queensland and he visits it only on his rare returns to Australia from overseas visits. He probably does not yet understand that there is an international airport at Townsville at which he might land on some of these returns. We have also seen the dismantling of the bicentennial water resources program by the Minister for Resources and Energy (Senator Walsh). The question this morning was answered in such a fashion that it was obvious that the Prime Minister's interest in or knowledge of the Burdekin was only a last minute intervention brought about by the fact that the Queensland election will be held at the end of this year. The Burdekin Dam was a commitment well before the Prime Minister entered this place as a member. That commitment was real. I want him to tell me why there are so many people engaged on this project which I have visited four times in as many years. Many people were working there in 1981, 1982 and 1983, well before the Prime Minister even became interested in it. I feel that the answer to the question this morning did not place emphasis where it should have been placed. Cane farmers, rice millers, rice growers, business people and newspaper proprietors in the Burdekin area have given a decade of commitment to this project. Finally they won through and saw the commitment made by the Fraser Government in 1980. The Prime Minister would not even know the names of the people with that lifetime of interest. Ian Chisholm, Ross Chapman, Joe Bugeja, Frank Rossiter, Ray Hoey and many other business people have been solid in this regard to try to get the matter going. I recall the efforts made by the previous member for Herbert, Mr Dean, and what he was able to promote in this area. Mr Humphreys —Did you support him? Mr BRAITHWAITE —I certainly supported him. The Prime Minister might be interested to know that the Burdekin Dam is in the electorate of Dawson, not in the electorate of Herbert where I am pretty sure he feels it is located. There has been an unpardonable delay by the Government in announcing that it will recommit itself to the Burdekin Dam and not welch on the deal, as it did in relation to the Alice Springs-Darwin railway link about which it promised something before the election and then walked away from that promise. I feel that the Prime Minister's recent policy recommitments in Townsville were only extensions of projects commenced by the Fraser Government. The Commonwealth offices in Townsville, the expansion of the Townsville Airport, the national highway program and the Burdekin Dam are only re-affirmations of projects commenced by the Fraser Government. Mr SPEAKER —Order! The honourable member's time has expired. Mr MILTON(La Trobe)(10.54) —Recently some hundreds of Tamils in Sri Lanka were killed as a result of communal violence. As some misleading and inaccurate statements have been made about the background to these regrettable acts of genocide it is important to put the record straight. The Tamils constitute about 20 per cent of the population of Sri Lanka. The majority of them live in the northern and eastern provinces and trace their ancestry in Ceylon for thousands of years. These are the indigenous Tamils. About a million Tamils live in the up country areas where tea and rubber are grown. They are descendants of those who were brought by the British from India 100 to 150 years ago to work in the plantations. The notion that the majority of Tamils are of recent Indian origin is false. The Portuguese and Dutch, previous rulers of Ceylon, administered the country, keeping the Tamil and Singalese areas separate, a situation which existed in the days of the Sinhala and Tamil kingdoms ruled by kings. The British, however, centralised the administration of the colony during their recent rule. A national government with representation of all communities was formed in 1948 when Ceylon became independent. At this time it was constitutionally agreed that Sinhala and Tamil would be the national languages and all people would have the responsibility of electing their government. Unfortunately, since that time the Tamils have been systematically disadvantaged by government decree beginning with the Act of Parliament which made Sinhala the only official language. Over the years there has been a continuing harassment of and repeated acts of violence on the Tamil community. I will now go over some of the more recent events that typify what has been happening to the Tamils. In June 1983 a public security protection Act was passed. This gave authority to dispose of bodies of those killed during anti- terrorist actions by armed forces without an inquest or inquiry. Then there was the banning of Tamil newspapers and the deportation of foreign correspondents. News censorship and blackouts were enforced. Finally, on 20 July, three Tamil schoolgirls were raped by soldiers. One girl suicided and another became insane. It was also reported that six school children were murdered by armed forces. On 23 July sympathisers ambused a military truck. Thirteen Sinhalese soldiers were allegedly killed in retaliation. Sinhalese soldiers then rampaged in Jaffna. Hospital sources revealed that 51 innocent Tamils were killed and many had bullet wounds. On 24 July a state funeral was given to the soldiers with a mass meeting in Colombo. The Sinhalese unleashed murder, arson, rape and looting on the innocent Tamils in Colombo and all over the island. One 25 July 37 Tamil detainees were massacred in a high security gaol in Colombo while awaiting trial . Three days later 17 more detainees were massacred in gaols. More foreign correspondents were then deported. Others were refused permission to enter. The Vatican representative to Sri Lanka was deported. The violence continued between 25 July and 31 July on innocent Tamils all over Sri Lanka with the armed forces encouraging and participating in the violence. The Australian reported that the President said: We can't think of Tamils nor about their lives or their opinion about us. The President appeared on television after seven days of continuous violence and said: . . . very sorry that this step has to be taken, but I cannot see any other way by which we can appease the natural desire and the request of the Sinhala people to prevent the country being divided and to see that those who seek for division are not able to do legally. The toll includes 279 dead according to government sources; there are over 2, 000 dead according to the Opposition. Eighteen thousand homes have been destroyed and looted and there are over 100,000 Tamil refugees. Over 100 factories and 2,000 small businesses have been destroyed. Thousands are unemployed and damages total over $95m. In August 1983 the Government announced a takeover of Tamil businesses and property for restoration. The major share of equity was vested with the Government after repair. Two international representatives from the Red Cross were expelled by the Government. They were not given any co-operation nor were they allowed to help refugees. Refugees are being transported to Jaffna by ship with the help of the Indian Government. The Government has decreed a loss of civic rights, professional status and confiscation of property to those who advocate separatism. President Jayawardena admitted on television that his armed forces turned against the Tamil minority and encouraged the Sinhales to attach Tamils during the recent communal voilence in Sri Lanka. The record is a sad and sorry one. I am sure that all honourable members of this House regret the terrible deeds that are being perpetrated against the Tamil citizens by their fellow Sinhalese citizens. Mr HODGMAN(Denison)(10.58) —On Friday, 1 September a disgraceful incident occurred at Canberra Airport involving the Soviet Ambassador to Australia, Mr Evgeny Samoteikin. Mr Holding —I raise a point of order, Mr Speaker. Mr HODGMAN —Who are you covering up for Clyde? Mr Holding —I am drawing the Speaker's attention to the rules of the House which the honourable member should know. A reflection can be made upon a representative of another nation only by a motion on notice. I refer you, sir, to page 26 of the Standing Orders, and the reference in May's Parliamentary Practice. Mr HODGMAN —This is a frivolous point of order. The honourable member is covering up for the Soviet Ambassador. I warned the Speaker that he would take this action. He is covering up for the Soviet Ambassador. Shame on him! Mr Holding —It is time you learnt the rules of the House and stopped acting like a cheap hooligan. Mr HODGMAN —He ought to be ashamed of himself. Shame! He is covering up. Mr Holding —I ask the honourable member for Denison to withdraw his remarks. I find them offensive. I am entitled, sir, to bring your attention to the rules of the House. Mr SPEAKER —I ask the honourable member for Denison to withdraw the remarks. Mr HODGMAN —Mr Speaker, this is a frivolous point of order. Mr SPEAKER —Order! The honourable member will withdraw the remarks. Mr HODGMAN —I withdraw, but I will deal with the honourable member later. Mr Holding —Mr Speaker-- Mr HODGMAN —This is what he is covering up for. Mr SPEAKER —Order! The honourable member for Denison knows that displaying such signs is not permitted in the House. If he offends again he will be named. It being 11 p.m., the House stands adjourned until 10.30 a.m. tomorrow. House adjourned at 11 p.m. The following notices were given: Mr Lionel Bowen to move- That, unless otherwise ordered, Government Business take precedence of General Business on each day of sitting until the Appropriation Bill (No. 1) 1983-84, the Appropriation Bill (No. 2) 1983-84 and the Appropriation (Parliamentary Departments) Bill 1983-84 have passed all stages in the House. Mr Hayden to present a Bill for an Act relating to the making by Australia of a special contribution to the International Development Association. Mr Hurford to present a Bill for an Act relating to the increase in Australia's quota in the International Monetary Fund. Mr Hurford to present a Bill for an Act relating to the subscription by Australia for additional shares in the capital stock of the Asian Development Bank. Mr Hurford to present a Bill for an Act to encourage and assist persons to purchase or build their own homes. Mr Hurford to present a Bill for an Act to amend the Home Deposit Assistance Act 1982. Mr Hurford to present a Bill for an Act to amend the Housing Loans Insurance Act 1965 and the Commonwealth Functions (Statutes Review) Act 1981. Mr Lionel Bowen to move- (1) That the resolution of appointment of the Joint Select Committee on Electoral Reform be amended: (a) by inserting after paragraph (3) the following new paragraph: '(3A) That the members of the committee hold office as a joint committee until the House of Representatives expires by dissolution or effluxion of time.'', and (b) by omitting paragraph (14), as amended, and substituting the following pargraphs: '(14) That the committee have leave to report from time to time. (14A) That the committee report as soon as possible.''. (2) That a message be sent to the Senate acquainting it of this resolution and requesting its concurrence. The following papers were deemed to have been presented on 6 September 1983: Air Navigation Act-Regulations-Statutory Rules 1983, No. 149 Australian Capital Territory Representation (House of Representatives) Act- Regulations-Statutory Rules 1983, No. 154 Commonwealth Electoral Act and Referendum (Constitution Alteration) Act- Regulations-Statutory Rules 1983, No. 153 Commonwealth Inscribed Stock Act-Regulation-Statutory Rules 1983, No. 157 Defence Amendment Act-Interim Determinations-Statutory Rules 1983, Nos 143, 144 Great Barrier Reef Marine Park Act-Regulations-Statutory Rules 1983, No. 148 Health Insurance Commission Act-Regulations-Statutory Rules 1983, No. 152 International Organizations (Privileges and Immunities) Act-Regulations- Statutory Rules 1983, Nos 145, 151 Lands Acquisition Act-Statement of lands acquired by agreement authorised under sub-section 7 (1) Navigation Act-Regulations-Statutory Rules 1983, No. 156 Northern Territory Representation Act and Commonwealth Electoral Act- Regulations-Statutory Rules 1983, No. 155 Public Service Act-Appointment-Department of Housing and Construction-M. P. Griffin Public Service Arbitration Act-Public Service Arbitrator-Determinations accompanied by statements regarding possible inconsistency with the law-1983- Nos 260 and 261-Professional Officers Association, Australian Public Service and others Nos 262 to 264-Professional Officers Association, Australian Public Service and others* Nos 265 to 268-Professional Officers Association, Australian Public Service and others No. 269-Professional Officers Association, Australian Public Service and others * Nos 270 to 278-Professional Officers Association, Australian Public Service and others No. 279-Professional Officers Association, Australian Public Service and others * Nos 280 to 286-Professional Officers Association, Australian Public Service and others No 287-Professional Officers Association, Australian Public Service and others No. 288-Professional Officers Association, Australian Public Service and others No. 289-Commonwealth Foremen's Association of Australia (Australian Public Service) No. 290-Administrative and Clerical Officers' Association, Commonwealth Public Service and others No. 291-Australian Broadcasting Commission Staff Association Nos 292 and 293-Association of Professional Engineers, Australia No. 294-Association of Draughting, Supervisory and Technical Employees* No. 295-Royal Australian Nursing Federation* No. 296-Australian Theatrical and Amusement Employees Association No. 297-Australian Public Service Association (Fourth Division Officers)* Nos 298 and 299-Professional Para-Medical Officers' Association, Commonwealth Public Service* No. 300-Federated Liquor and Allied Industries Employees Union of Australia Nos 301 to 303-Australian Public Service Association (Fourth Division Officers) * No. 304-Australian Public Service Association (Fourth Division Officers) No. 305-Administrative and Clerical Officers' Association, Australian Government Employment and others No. 306-Australian Broadcasting Commission Staff Association No. 307-Australian Theatrical and Amusement Employees Association No. 308-Professional Musicians' Union of Australia No. 309-Australian Journalists Association No. 310-Australian Broadcasting Commission Senior Officers' Association and another No. 311-Australian Journalists Association No. 312-Actors' and Announcers Equity Association of Australia No. 313-Australian Journalists Association No. 314-Administrative and Clerical Officers' Association, Commonwealth Public Service and others No. 315-Australian Journalists Association (* Not accompanied by statement) Radiocommunications Licence Fees Act-Regulations-Statutory Rules 1983, No. 146 Salaries and Wages Pause Act-Regulation-Statutory Rules 1983, No. 150 Seat of Government (Administration) Act- Determinations, dated 23 August 1983, listing fees for the purposes of- Building Ordinance Dog Control Ordinance Hawkers Ordinance Motor Traffic Ordinance Ordinances-1983- No. 20-Building (Amendment) No. 21-Motor Traffic (Amendment) (No. 3) No. 22-Hawkers (Amendment) No. 23-Dog Control (Amendment) No. 24-Weights and Measures (Amendment) No. 25-Money Lenders (Amendment) (No. 2) Regulations-1983- No. 6 (Motor Traffic Ordinance) No. 7 (Building Ordinance) No. 8 (Weights and Measures Ordinance) No. 9 (Motor Traffic Ordinance) Variations (2) of plan of lay-out of City of Canberra and its environs, dated 6 September 1983 Wireless Telegraphy Act-Regulations-Statutory Rules 1983, No. 147 The following answers to questions were circulated: Question No. 40 Dr Everingham asked the Minister for Health, upon notice, on 3 May 1983: Can he supply references to refute (a) Rapaport's 1959 findings relating Down's syndrome to Fluorine in Bull. Acad. National de Med. Paris 143 : 367, (b) G. L. Waldbott's findings of fluoride intolerance in Fluoridation-The Great Dilemma page 131, Coronado, 1978, (c) P. E. Zanfagna's findings in Allergy to fluoride, Fluoride Off. Quart. J.Intl.Soc. Fluoride Res. 9 : 36-41, 1976 and (d) Steyn's findings of endemic goitre in high fluoride areas in South Africa. Dr Blewett —The answer to the honourable member's question is as follows: (a) (i) Rapaport's findings relating Down's syndrome to fluoride intake were examined by a Royal Commission into the Fluoridation of Public Water Supplies, Hobart, 1968. The Commissioner was critical of Rapaport's methodology (pages 166 -167 of the report), and referred to an extensive investigation by the Department of Health, Education and Welfare of the United States of America, which showed no correlation between Down's syndrome and fluoridated water (page 168 of the report). The Commissioner found no evidence that fluoridated water caused Down's syndrome. (ii) Erickson et al. (Journal of the American Dental Association, 1976: 93, 981 ) examined data relating to 1,387,027 births in U.S.A. and found no correlation between Down's syndrome and fluoridation. (iii) The effects of fluoridation on the prevalence of congenital malformations in Birmingham (England) was studied by Knox et al. (Community Medicine, 1980: 2, 190). Birmingham's water supply was fluoridated in 1964. It was concluded that there was no evidence of specific teratogenic or general toxic effects resulting from fluoridation. (b) In the investigation quoted by Waldbott, Roholm in 1937 had described skeletal fluorosis in workers who have been exposed to excessive amounts of fluoride for many years during the industrial processing of cryolite (sodium aluminium fluoride). Other studies have confirmed the hazard of the longterm intake of excessive amounts of fluoride. However, skeletal fluorosis does not occur at the low concentrations of fluoride used in fluoridation of water. (c) (i) The possibility of allergy to fluoride was considered by the American Academy of Allergy which concluded that there was no evidence of allergy or intolerance to fluorides as used in the fluoridation of water supplies, (Austen et al. Journal of Allergy and Clinical Immunology, 1971: 47, 347). (ii) Claims that fluoridation of water caused allergic responses were considered by the Governor's Commission of Fluoridation in Minnesota. The Commission reported that it did not accept the claims of allergic reaction to fluoridated water (Anders et al. Report of the Governor's Commission on Fluoridation, Minnesota, 1979). (d) Steyn's investigation concerning endemic goitre in high fluoride areas in South Africa was carred out in 1936. Subsequent research by Jackson and also by two investigators appointed by the South African Commission of Inquiry into Fluoridation (1966), found no evidence that fluoride in the drinking water was a cause of goitre. These investigations are referred to in the Report of the Royal Commission into the Fluoridation of Public Water Supplies, Hobart, 1968 (page 154). The South African Commission of Inquiry reported that there was no evidence of association between fluoride and goitre. Question No. 43 Dr Everingham asked the Minister for Foreign Affairs, upon notice, on 3 May 1983: (1) Has his attention been drawn to any reports of a telecast twice shown on PBS television to millions of Americans and in part or whole in several European countries, entitled 'Nuclear War: The Incurable Disease', featuring the major part of a live broadcast to millions of citizens from Moscow by three prominent physicians from the United States of America and three from the Soviet Union. (2) If so, will he obtain the program for the National Film Library or Parliamentary Library from International Physicians for Prevention of Nuclear War, 225 Longwood Avenue, Boston, Mass 02115, U.S.A. and recommend it to television stations in Australia. Mr Hayden —The answer to the honourable member's question is as follows: (1) and (2) I am advised that the film is only available on video cassette. My Department is in contact with the Parliamentary Library about the possible procurement of a copy. Question No. 49 Dr Everingham asked the Minister for Foreign Affairs, upon notice, on 3 May 1983: (1) Does the Government accept that the arms race is progressively making more likely a nuclear war by accident, miscalculation or fear of pre-emption. (2) Will the Government indicate to the Western nuclear powers that nuclear deterrence of conventional war lacks credibility in view of the Vietnam and Afghanistan campaigns and should be phased out in favour of staged, verifiable and legally enforceable replacement of armed forces by democratically appointed peace-keeping forces, enforceable international arbitration and development of democratic representation of all world citizens on an international authority with power to strengthen international law; if not, why not. Mr Hayden —The answer to the honourable member's question is as follows: (1) The Government is concerned that continued escalation of the arms race would increase the risks of nuclear war. For this reason the Government is encouraging negotiations between the super powers designed to reduce their nuclear and conventional forces. At the same time, the Government recognises that arms control negotiations between the two super powers have increased knowledge and understanding about each side's capabilities and intentions. This process may, in turn, have helped to make it less likely that there will be an outbreak of nuclear war by accident, miscalculation or fear of pre-emption. The Government believes that the hot-line agreements between the Soviet Union and the western nuclear powers, as well as the 1976 Agreement on Measures to Reduce the Risk of Outbreak of Nuclear War between the U.S.A. and the U.S.S.R., have contributed to this process. (2) The Government has made known its concerns about the risks of nuclear war and its interests in promoting policies of peace and disarmament to government leaders in a number of countries, including the Western nuclear powers. Australia has been an active supporter within the United Nations and elsewhere of policies designed to promote international peace-keeping activities. In addition to financial contributions, we have provided personnel and equipment to operations in Cyprus, Kashmir and the Middle East. Australia is also a member of the General Assembly's Special Committee on Peace-Keeping Operations which was set up to review the whole question of peace-keeping. Careful note has been taken of the constructive suggestion that Australia advocate the phasing out of deterrence in favour of staged verifiable and legally enforceable replacement of armed forces by democratically appointed peace-keeping forces, enforceable international arbitration and development of democratic representation of all world citizens on an international authority with power to strengthen international law. It presupposes, however, a measure of co-operation amongst states which is not in fact discernable. The present situation is characterised by competition, rivalry and tensions between states on a range of issues which prevent the co-operation and concensus necessary for reform of the international system. The Government is pursuing policies aimed at reducing tensions and facilitating the process of negotiations necessary to make progress in this area. Question No. 130 Mr Robert Brown asked the Minister for Foreign Affairs, upon notice, on 12 May 1983: (1) When were Australian advisers and troops committed to the war in Vietnam. (2) Over what period were Australians involved in the war. (3) What was the total cost of Australia's involvement. (4) What aid other than military was provided over this period and for what purposes. (5) What aid has been provided since Australia's military withdrawal in 1972 and for what purposes. (6) When did aid cease to be provided and what was the reason. Mr Hayden —The answer the the honourable member's question is as follows: (1) Australian advisers and troops were first committed to the war on 24th May 1962, following a Government announcement to commit thirty officers and other ranks of the Australian Army Training Team to Vietnam. (2) The Training Team's first detachment arrived in Vietnam on 31 July 1962, and from then until June 1973 various elements of the Defence Force operated in the country. (3) The estimated total cost is assessed to be $466.2 million, which comprises $247.6 million for the normal cost of maintaining those forces in Australia, and $218.6 million for the additional costs of maintaining them in Vietnam. In addition, $6.0 million was spent on military aid to South Vietnam over the period 1970-71 to 1972-73. (4) Civilian aid was first made available to the Government of the Republic of Vietnam under the Colombo Plan, in 1954-55. During the years of Australia's active military involvement this aid took the form of educational assistance and civil infrastructure projects designed to assist the Government of the Republic of Vietnam meet its economic and social development goals. A total of $27.688 million in aid was provided by Australia to Vietnam from 1962 to 1973. (5) A total of $25.106 million in aid was provided between the time of Australia's military withdrawral in 1973 to 1979. This aid continued to be in the form of educational assistance and civil infrastructure projects. (6) Civilian aid to the Government of the Republic of Vietnam ceased when that Government fell in April, 1975, although the majority of Vietnamese students in Australia nominated by that Government stayed on in Australia to complete their courses of study. A subsequent program of Australian assistance to the Socialist Republic of Vietnam was suspended by the previous government in January 1979 in response to Vietnam's invasion of Cambodia. A total of 88 students nominated by the SRV had taken up Australian awards. At the time of suspension, 35 students were still undergoing training and were permitted to complete their courses in Australia. Question No. 148 Dr Charlesworth asked the Minister for Employment and Industrial Relations, upon notice, on 17 May 1983: (1) What level of grants have been allocated to CYSS projects in the Electoral Division of Perth. (2) What has been the nature of the individual projects funded by the Government in the electorate and, in particular, (a) what proportion of these projects have been oriented towards traditional female occupations and (b) are statistics available on the extent to which participants in particular CYSS projects in the electorate succeed in finding employment in related areas; if so , what are the details. Mr Willis —The answer to the honourable member's question is as follows: (1) Details of the Commonwealth Grants provided to the 5 Community Youth Support Scheme (CYSS) projects located in the Electoral Division of Perth with effect from 1 July 1983 are: Annual grant Project level $ Bayswater (Morley) 65,000 Inglewood (East Victoria Park) 65,000 Perth ( Centre-Care) 65,000 Perth (YMCA) 65,000 Yokine 42,600 All existing CYSS projects have been invited to make application for new grants covering the twelve month period 1 November 1983 to 31 October 1984. Annual grant levels may be varied as part of this process. (2) (a) Each of the projects located in the Electoral Division of Perth provides activities positively oriented towards employment, and offers a balanced and broad range of activities covering both male and female employment opportunities. As would be expected, however, traditional occupational sex biases are reflected in the participation of males and females in such activities. An external study has been commissioned to investigate ways in which the access of young women to CYSS projects might be enhanced and how CYSS can be made more relevant to their special needs. Results are expected to be available later this year. (b) The Community Youth Support Scheme is designed to provide a broad range of employment skills for unemployed young participants. Unlike TAFE, CYSS Centres do not have as their primary objectives training in specific vocational skills. Accordingly, the statistics provided by individual projects only give an indication of employment outcome without reference to specific ocupational areas . Question No. 160 Mr Jacobi asked the Minister for Defence, upon notice, on 17 May 1983: (1) Will he bring up to date the information given by his predecessor in answer to question No. 3824 (Hansard, 17 March 1982, pages 1111-12), concerning (a) the movement of Soviet naval ships in the Indian Ocean, (b) the movement of Soviet naval ships in the North, West and South Pacific and (c) the movement of Soviet naval vessels in the (i) Persian Gulf, (ii) Gulf of Oman, (iii) Gulf of Aden, ( iv) Arabian Sea, (v) Red Sea, (vi) Eastern Mediterranean and (vii) Black Sea. (2) Further to his predecessor's answer to questions No. 4641 (Hansard, 24 August 1982, pages 879-80), and No. 2193 (Hansard, 18 August 1982, pages 678-9), can he now say whether significant development for Soviet naval purposes has occurred at Dahlak Island, Aden, Socotra or at the Bay of Turbah. (3) Will he take steps, in accordance with recommendation 14 of the 1976 report of the Joint Committee on Foreign Affairs and Defence entitled 'The Middle East- Focal Point of Conflict', to appoint military attaches to appropriate diplomatic missions in the Middle East, in view of the geo-political and strategic importance of the Gulf of Hormuz, Bab-el-Mandeb, the Red Sea and the Persian Gulf, within the Middle East. Mr Scholes —This answer replaces the answer previously supplied to the honourable member on 23 June 1983: (1) (a) Monthly class/day figures of Soviet naval and naval-associated ships which operated in the Indian Ocean during the period 1 January 1982-30 April 1983 are shown in the following table. SOVIET NAVAL ACTIVITY INDIAN OCEAN (SHIP DAYS) JANUARY 1982-AUGUST 1982 Jan. Feb. Mar. Apr. May June July Aug. Aircraft Carrier Kiev . . . . . . . . . . . . . . . . Cruisers Kara 31 28 31 . . . . . . . . . . Kresta . . . . 31 30 31 30 31 31 Destroyers Kashin . . . . . . . . . . . . . . . . Frigates Krivak 62 56 62 40 58 40 31 31 Submarines Charlie 31 28 18 . . . . . . . . . . Echo II . . 5 31 30 31 30 5 . . Victor . . . . 8 51 62 68 61 31 Foxtrot 62 56 60 4 . . . . . . . . Mine sweepers T-58 31 28 31 30 18 . . 22 31 Natya . . . . . . 10 31 39 31 31 Landing ships Alligator 62 60 80 60 58 30 31 31 Ropucha . . . . . . . . 12 30 5 26 Auxiliaries Tugs 29 28 31 30 31 30 20 25 Barracks ship . . . . . . . . 23 23 . . . . Oilers 56 37 31 26 77 30 31 31 Repair Ships 31 28 31 30 31 30 31 35 Sub Tenders 31 8 28 36 31 30 31 31 Tankers 62 . . 55 60 62 66 67 55 Miscellaneous 244 225 232 255 346 314 255 192 Others Oceanographic 62 56 59 . . 30 39 4 31 Hydrographic 51 56 94 110 124 109 85 37 Int Collectors 31 28 49 33 39 73 86 33 SOVIET NAVAL ACTIVITY INDIAN OCEAN (SHIP DAYS) SEPTEMBER 1982-APRIL 1983 Sep. Oct. Nov. Dec. Jan Feb. Mar. Apr. Aircraft Carrier Kiev . . . . 9 31 17 . . . . . . Cruisers Kara . . . . 9 31 17 . . 29 30 Kresta 30 31 . . . . . . . . . . . . Destroyers Kashin . . . . . . . . . . 8 29 30 Frigates Krivak 30 43 30 12 . . . . 18 30 Submarines Charlie . . 11 30 31 31 7 . . . . Echo II . . . . . . . . . . 22 31 30 Victor 21 . . . . . . . . . . . . . . Foxtrot . . 11 30 11 . . . . . . . . Mine sweepers T-58 30 31 30 31 11 . . . . . . Natya 30 31 59 43 31 28 31 38 Landing ships Alligator 30 31 59 43 31 28 31 55 Ropucha 21 . . . . . . . . . . . . . . Auxiliaries Tugs 30 31 30 60 62 33 60 60 Barracks ship . . . . . . . . . . . . . . . . Oilers 30 50 42 44 17 8 17 30 Repair Ships 49 31 34 57 31 28 60 32 Sub Tenders 38 56 30 31 31 44 39 30 Tankers 30 48 60 62 42 28 54 60 Miscellaneous 201 154 120 149 170 215 268 231 Others Oceanographic 30 31 27 . . . . . . . . 31 Hydrographic 48 71 60 62 74 50 62 52 Int Collectors 30 56 39 42 31 28 31 30 (1) (b) Information on the movement of Soviet naval ships in the North and West Pacific is provided primarily by friendly nations on the understanding that its composition is protected. In the South Pacific, in October 1982, a Soviet Naval research ship and a FOXTROT-class submarine were noted west of Tahiti. This group was also seen east of New Zealand in December. (1) (c) It is not possible to provide a detailed analysis of Soviet naval activity specifically within the Persian Gulf, Gulf of Oman, Gulf of Aden and the Arabian Sea. However, the information provided on Indian Ocean activity in the above table, because of the geopraphy of the area, takes in naval ship movements in these peripheral waters. Soviet naval movements in the East Mediterranean and the Black Sea, being of less direct strategic concern to Australia, are not analysed in detail. (2) The information given in response to your Questions No. 4641 and 2193 about developments at Dahlak Island, Aden, Socotra Island and the Bay of Turbah remains current. (3) The question of whether military attaches should be appointed to appropriate diplomatic missions in the Middle East is kept under review. Given the requirement for restraint in the growth of overseas staff, such appointments must be carefully evaluated against existing and foreseen representational requirements in terms of the whole range of functions attaches are appointed to carry out, and relative priorities established. While the general strategic significance of the Middle East area is appreciated , permanent representation there does not have a level of priority that would warrant appointment of resident military attaches at present. Note: The information contained in the above answer has been drawn from unclassified sources. Question No. 217 Mr Reeves asked the Minister representing the Attorney-General, upon notice, on 24 May 1983: What are the total amounts of all expenditures and/or capital works programs undertaken by the Minister's Department in or related to the Northern Territory for each year from 1978-79 to 1982-83 which were not covered by general or specific grants to the Northern Territory. Mr Lionel Bowen —The Attorney-General has provided the following answer to the honourable member's question: Expenditures excluding capital works programs incurred by the Attorney-General' s Department in the Northern Territory and not covered by general or specific grants to the Northern Territory are: 1982-83 1978-79 1979-80 1980-81 1981-82 (estimated) $ $ $ $ $ Northern Territory Supreme Court 886,021 232,360 . . . . . . (to 30.9.79) Commonwealth Reporting Service NT Branch 218,758 60,864 . . . . . . (to 30.9.79) Australian Legal Aid Office, NT Branch 472,505 559,788 695,288 805 ,439 1,181,000 Other Branches, NT 482,866 658,576 750,353 843,617 859,045 2,060,150 1,511,588 1,445,641 1,649,056 2,040,045 These amounts will be understated by an amount estimated at between $10,000 and $50,000 per annum, being expenditure on salaries and administrative support for Northern Territory programs incurred interstate. The expenditure cannot be readily quantified. Expenditure on capital works and repairs and maintenance will be provided by the Minister for Housing and Construction, while expenditure on acquisition of sites and buildings will be provided by the Minister for Administrative Services . Question No. 243 Mr Staples asked the Minister for Science and Technology, upon notice, on 26 May 1983: (1) Are there any exotic plant pathogens being researched on, and currently stored in Australia; if so, (a) what are these pathogens, (b) who is working on them, and (c) what level of microbiological security are these pathogens being used and stored. (2) Are any of the exotic plant pathogens capable of causing damage to Australian crop, pasture or native flora. (3) How do the microbilogical security conditions compare with those under construction at the Australian National Animal Health Laboratory (ANAHL) for the containment of live exotic viruses. (4) Have any persons involved with these pathogens made opinions on the facilities and security of the ANAHL and the related proposal to import live foot-and-mouth disease virus. (5) Were the opinions expressed in favour or against the live import of foot- and-mouth disease virus. Mr Barry Jones —The answer to the honourable member's question is as follows: (1) Yes. (a) Rust isolates from New Zealand, Xanthomonas ampelina, X. axonopodis, X. populi, X. fragariae, X. manihotis, Pseudomonas asplenii, P. hibiscicola, Fusarium spp., Curvularia spp. Drechslera spp., Tomato bushy stunt virus, Phialophora spp., Coryneform bacterium causing stunting of Cynodon dactylon, Agrobacterium rubi. Cadang cadang viroid, Cucumber pale fruit viroid, Chrysanthemum stunt viroid, Potato spindle tuber viroid, Beet curly top virus, Clover yellow vein virus, Clover yellow mosaic virus, Pea streak virus, Peanut stunt virus, Red clover vein mosaic virus, White clover mosaic virus, Ustilago spinificis. U. renderi, Broad bean mottle virus, Belladonna mottle virus, Cacao yellow mosaic virus, Clitoria yellow vein virus, Dulcamara mottle virus, Eggplant mosaic (Type strain) virus, Erysimum latent virus, Okra mosaic virus, Ononis yellow mosaic virus, Plantago mottle virus, Poinsettia mosaic virus, Scrophularia mottle virus, Wild cucumber mosaic virus, Cucumber green mosaic virus, Sunnhemp mosaic virus, Botrytis spp., Erysimum latent virus. (b) Mr J. D. Oates, Dr P. Fahy, Dr L. Burgess, Dr J. Alcorn, Dr G. Behncken, Dr L. E. Leightley, Dr D. S. Teakle, Dr C. Hayward, Dr R. H. Symons, Dr J. Randles, Dr R. Francki, Dr A. J. Gibbs, Dr. R. Cruickshank, Mr P. Jenkins, Dr D. D. Shukla. (c) Imported cultures may be used in the laboratory of the applicant only. They must be labelled and held separately from other cultures. Glassware and other equipment must be sterilised after use. Few cultures are permitted entry for experiments involving plant inoculations. These are performed in growth cabinets or glasshouse compartments, access to which is strictly limited to responsible personnel only. Plants must be destroyed and pots and soil sterilised on completion of tests. There is a regular check maintained on cultures imported into Australia. (2) Yes. (3) The conditions for containment of live plant viruses are less secure than those at the Australian National Animal Health Laboratory (ANAHL) which will be the most secure microbiological laboratory in Australia. (4) Yes. Of those listed in 1 (b) above Dr Gibbs has made representations to Ministers and made public statements on the proposal to import foot-and-mouth disease virus. (5) Dr Gibbs was opposed to importation of foot-and-mouth disease virus. Question No. 249 Mr Lloyd asked the Minister for Communications, upon notice, on 26 May 1983: (1) When will a decision be made on the reform of the broadcast frequency spectrum. (2) What (a) changes are being considered and (b) effects will these changes have on radio and television channels. Mr Duffy —The answer to the honourable member's question is as follows: (1) Consultations between my Department and Industry have commenced on proposed principles for re-assignment of some parts of the radio frequency spectrum used by broadcasting. Once these consultations, which will include the Broadcasting Council, have been completed, I shall seek Government endorsement of the conclusions. The timing of a final decision depends on the duration of the consultations with Industry. I hope a final decision will be announced within the next few months. (2) (a) Existing or proposed Government initiatives in broadcasting are creating pressure on the Very High Frequency (VHF) band. In Australia, VHF television channels 3, 4 and 5 occupy most of the spectrum space internationally used for Frequency Modulation (FM) radio, namely 88-108 MHz (Band II). In order to ensure sufficient VHF-FM frequencies will be available throughout Australia for the implementation of new intiatives in broadcasting, it is proposed that some television stations currently occupying frequencies in Band II will be assigned alternative frequencies. (b) It is expected that these changes will make possible the further development of FM radio (ABC, commercial, and public) and the provision of additional television services in regional areas. Question No. 262 Mr Gayler asked the Minister for Defence, upon notice, on 26 May 1983: What proportion of overall operations of each of the armed forces has been carried out between the area bounded by Cairns, Port Hedland, and Australia's northern frontier, excluding operations associated with overseas flights and sailings by the RAAF and the RAN. Mr Scholes —The answer to the honourable member's question is as follows: The statistics sought are not readily available. Although very substantial data is held in the Department of Defence and each of the arms of the Defence Force on the activities of elements of the Defence Force, such data is for on-going purposes and does not lend itself readily to compilation into the form sought by the honourable member. From a broad analysis of Defence Force exercise activities in northern Australia, that is north of the Tropic of Capricorn, over the period July 1979 to July 1983, my Department has concluded that the proportion of overall activities of each of the arms of the Defence Force held in that area was about: RAN-35 per cent, Army-25 per cent, RAAF-25 per cent. These proportions vary year by year. They do not include day-to-day activities by units based in the area. As well, cognizance must also be taken of the significant operational activity undertaken in the form of surveillance of the Australian Fishing Zone by RAN patrol boats and RAAF Orion maritime patrol aircraft. In any one year, approximately 70 per cent of patrol boat operations and 50 per cent of Orion operations are conducted north of the Tropic of Capricorn. There is no doubt that the proportion of defence activity in northern Australia has increased substantially over the past decade. This reflects a recognition of the strategic significance of northern Australia in any credible circumstance of armed attack on Australia. That recognition is endorsed by the present government. Question No. 278 Mr Macphee asked the Minister representing the Minister for Social Security, upon notice, on 26 May 1983: (1) Is it a fact that if a person dies on the date of issue of a pension cheque the pensioner's estate is entitled to the full fortnight's pension contained in the cheque. (2) Is it also a fact that where the pensioner dies before the fortnightly cheque is due but after it is posted the pensioner's estate is obliged to refund the entire cheque rather than only that amount which relates to the period after the recipient's death. (3) Is it further a fact that where a pensioner dies before the cheque is posted no pro rata payment is made for the period during which the pensioner lived after the last payment of the pension. (4) If the positions outlined in parts (1) to (3) are correct, will he change this practice to the more equitable pro rata payment to cover the last few days of the pensioner's life. Dr Blewett —The Minister for Social Security has provided the following answer to the honourable member's question: (1) to (3) Yes: pensions are payable neither in arrears nor in advance. Rather each instalment is due and payable on each and every pay-day during which the pensioner remains eligible. (4) Under a pro rata system any additional payment to the pensioner's estate on death would, on average, be offset by a smaller instalment paid to the pensioner when pension was first granted. Overall it is considered that the balance of advantage lies with the present system. Question No. 279 Mr Lloyd asked the Minister for Communications, upon notice, on 26 May 1983: (1) What is the present position in relation to a person delivering articles into a householder's letter receptacle which is clearly marked 'for postal articles only'. (2) Will he seek to amend the Postal Services Act to make this practice illegal . Mr Duffy —The answer to the honourable member's question is as follows: (1) The Postal Services Act 1975 does not prohibit the placement of any item in a householder's mail box, irrespective of whether it is marked 'for postal articles only'. (2) The Committee of Inquiry into the Monopoly Position of the Australian Postal Commission suggested that the Postal Services Act be amended to make it an offence for anyone other than Australia Post to place material into private letter boxes marked 'for postal articles only'. I have sought the views of the Attorney-General on this suggestion of the Bradley Committee, as it concerns consumer protection policy, more so than postal policy. Question No. 291 Mr Lloyd asked the Minister for Communications, upon notice, on 26 May 1983: (1) Does the legislation currently governing Australia Post provide the Commission with sufficient incentive to undertake continuing assessment of the economic use of its network or individual assets within that network. (2) If not, what will rectify this situation, and when will he take appropriate action. (3) If the situation referred to in part (1) is the case, why is this not contrary to the view of the Committee of Inquiry into the Monopoly Position of the Australian Postal Commission. Mr Duffy —The answer to the honourable member's question is as follows: (1) Yes, as provided in section 7 of the Postal Services Act 1975. (2) Not applicable. (3) I am unable to answer this part of the question; I find it incomprehensible . Question No. 297 Mr Macphee asked the Minister for Employment and Industrial Relations, upon notice, on 26 May 1983: Further to the commitment in the statement of the Minister for Immigration and Ethnic Affairs indicating less reliance on the migration program as a source of skilled workers, greater emphasis on the training and re-training of Australians to fill skilled vacancies and the intention to develop a manpower planning approach to ensure that economic recovery was not held back by skilled labour shortages, can he indicate (a) what additional training and re-training programs the Government has in mind, (b) whether it has been possible to overcome any position of craft unions to mature age training and (c) whether he endorses the attitude that when the world economy recovers the Government's manpower planning approach will avert a return to levels of skilled migration similar to those experienced during the period of the previous Government. Mr Willis —The answer to the honourable member's question is as follows: As the Minister for Immigration and Ethnic Affairs indicated in his statement on the migration program to the House of Representatives on 18 May 1983, we will , together with the Minister for Education and Youth Affairs and the Treasurer, be looking for alternatives to the recruitment of skilled workers overseas to reduce Australia's long-standing reliance on this source of labour supply. To this end, we directed officials to review possible alternatives and report to us by end-August. Furthermore, as I announced to the House on 19 May the Government will also be conducting a broad review of all existing training and assistance programs to ensure that they fully meet our objectives. The Government therefore expects to be in a position to take training, re-training and related intiatives during the course of 1983-84 which will help to ensure that Australia's skilled labour requirements are met by Australian residents to a greater extent than in the past. Question No. 334 Mr Campbell asked the Minister for Science and Technology, upon notice, on 23 August 1983: Did the following companies receive grants of $300,000 or more in 1980-81 under the Australian Industrial Research Development Incentives Board's project grants : (a) Australian Paper Manufacturers Ltd, (b) Amalgamated Wireless (Australasia) Ltd, (c) ACI Operations, (d) Australian Mineral Industries Research Association Ltd, (e) Broken Hill Associated Smelters Pty Ltd, (f) Bendisi Corporation Australia Pty Ltd, (g) Bradken Consolidated Ltd, (h) Broken Hill Proprietary Co. Ltd, (i) Comalco Aluminium Ltd, Comalco Research Pty Ltd and Comalco Aluminium ( Bell Bay) Ltd, (j) Cleveland Tin Ltd, (k) Email Ltd, (m) Concurrent Processing Systems Pty Ltd, (n) Electrolytic Zinc Co. of Australasia Ltd, (o) ICI Australia Ltd, (p) MIM Ltd, (q) Orbital Engine Co. Pty Ltd, (r) Mauri Brothers & Thompson (Aust.) Pty Ltd, (s) Varian Techtron Pty Ltd, (t) Yeelirrie Management Services Pty Ltd and (u) Hospital Products International Pty Ltd; if so, (A) on what grounds did these companies receive the grants, (B) what is the general criteria used to determine which companies will receive the grants and (C) how are the amounts of individual grants determined. Mr Barry Jones —The answer to the honourable member's question is as follows: (a) to (e) Yes, (f) company not recognised; if Bendix Corp. Aust Pty Ltd, yes, (g) to (u) yes. (A) and (B) The Australian Industrial Research and Development Incentives Board examines and makes a relative assessment of all project grant applications received by it. The selection is based on requirements specified in the Industrial Research and Development Incentives Act 1976, Ministerial Directions issued to the Board and funds made available to it in the budgetary context. The criteria currently being used by the Board were published in the Commonwealth of Australia Gazette of 21 December 1982. (C) The amount of grant is normally 50 per cent of the assessed cost of undertaking the R&D project. The assessment of costs is based on company claims which are scrutinised by the Board's technical and cost investigators and reviewed as appropriate. Normally, no one company or a group of related companies can receive more than $750,000 in a year. However, the Minister can approve a higher grant limit upon the Board's recommendation in certain circumstances.