Monday, 14 October 1985 Mr SPEAKER (Hon. Harry Jenkins) took the chair at 2 p.m., and read prayers. Mr LIONEL BOWEN(Kingsford-Smith-Acting Prime Minister) —I advise the House of the following ministerial arrangements: The Prime Minister, Mr Hawke, is attending the Commonwealth Heads of Government Meeting in the Bahamas and will be absent from Australia until 25 October 1985. I will be acting as Prime Minister in his absence. The Minister for Community Services, Senator Grimes, is also absent from Australia on Government business. He is travelling to Thailand and to various European countries to attend meetings and study disability programs. The Minister for Health, Dr Blewett, will act as the Minister for Community Services in his absence and Senator Ryan will represent the Acting Minister. Mr HAWKER —I direct my question to the Minister for Primary Industry. Is the Government considering an export tax on live sheep exports? Mr KERIN —No. Mr CUNNINGHAM —Can the Minister for Defence advise the House of the outcome of the review by the Royal Australian Air Force of its decision on the future of the RAAF guard dog which is well known by the nickname Sheriff? Mr BEAZLEY —The honourable member has been assiduous in raising this issue with me over some period. He has obliged me in the course of his representations to examine RAAF policy on the release of dogs it has trained to be guard dogs, particularly at what point of time it is prepared to consider their release into the general community. My first conclusion of that review is that I shall never review a decision on a dog again. My second conclusion is that the policy the RAAF has in relation to the dogs is appropriate, given the nature of the animals and the consequences to the general community were those animals to be prematurely released into it. The evaluation processes of the RAAF are perfectly acceptable as far as those dogs are concerned. It needs to be borne in mind that it is all very well to receive pressures from one angle in regard to the future of these dogs, but there would be a very reasonable public reaction to releasing into the community dogs which could be considered to be dangerous by the people who had been responsible for their management. I have been advised, after all that, by the Air Force that Sheriff is not to be put down but is to be retrained as a pool dog, that is, a dog that will work with a variety of handlers. So in that context Sheriff will not be destroyed. However, I support the Air Force's decision not to release the dog to its former handler, LAC Brendan Prendergast, on the grounds that Sheriff is still assessed as being very aggressive and has not lost the will to attack or bite. Mr SPEAKER —Since I have been Speaker I have, I think, lessened a little the rigidity of the rule relating to the acknowledgement of certain people present in the gallery. I have tried to do this in a sensible manner. What I will do is rather unusual, and the gentleman I am going to mention will know how unusual it is. After many years in the Press gallery, for the first time we have present in the Speaker's gallery Mr Alan Reid who has reported the proceedings of this Parliament for so long. I guess that many of us have probably disagreed with Alan's reporting from time to time, but we have all treated him with the greatest of respect for the years of service he has given to this Parliament from the Press gallery. Alan, we are glad you are able to join us. Honourable members-Hear, hear! Mr IAN ROBINSON —I ask the Treasurer: Why will farmers, regardless of when they purchased farms, suffer limitations to the income losses they can offset against off-farm income when investors in real estate will be able to retain the benefits of negative gearing on properties purchased up to 17 July 1985? Further, why will farmers have limitations imposed on them when the Broken Hill Proprietary Co. Ltd can offset losses in its steel division against losses in other divisions? Further, why have farmers been singled out when owners of multiple retail businesses, for example, are able to offset their losses? Finally, why is the Government continuing to discriminate against the farming sector of this country? Mr KEATING —The whole premise of the question is basically unsound. The fact is that someone who relies 100 per cent upon farm income is not affected at all, and that is the position of most farmers. Members of the National Party, who for years have masqueraded as the protectors and defenders of the farming interests of this country, ought to understand that someone relying on a farm income is not affected by this measure at all. The reason that there is quarantining is not to discriminate against the farm sector. We have made a commensurate discrimination against the property sector by virtue of the fact that these are areas of tax sheltering: Negative gearing in property and farm losses incurred by Pitt Street farmers. For years high income people who have been receiving their income predominantly away from the farm sector have been allowed to offset losses on farms where they have in many respects not really attempted to establish a firm agricultural base or a substantial agricultural income. Rather, they have written off capital and running costs against their other non-farm income for the purposes of securing, over time, a capital gain. What this has done to the farm sector is to drive up land prices in some areas to the clear disbenefit of genuine farmers who have been trying to buy land and aggregate properties and who are now carrying substantial mortgages around their necks because the coalition parties for 30 years allowed the people they represent, very high income earners, to walk through the 60c tax rate by leaving all these loopholes in the tax system, one of the most glaring of which is tax sheltering. The honourable gentleman asked me a question which I answered last week. Had he been listening he would have got the answer, that is, that any losses prior to 1986-87 are not lost. They can be carried forward. Indeed, any losses that accrue even after the introduction of this measure can be carried forward. They are not lost. In terms of offsets for people who are in a genuine farming position and seek some offset of their income or some complement to their income from a non-farm source, there are two tests. The first allows for full loss of non-farm income up to $15,000, with a partial loss to $30,000. Of course, where the property is owned and operated by a husband and wife there are two sets of such offsets in respect of the $15,000 and $30,000 limits for both taxpayers. The other test is the aggregate of five years under which farmers can write off losses against non-farm income up to the aggregate of the previous five years net farm income. So genuine farmers who are receiving some off-farm income to complement their farm income will be protected by that measure. In respect of averaging, I made it clear last week that at the moment the current averaging provisions allow for up to $5,000 of non-farm income to be included and this will now be increased to $15,000. This will save the farming community $20m, so most farmers will be advantaged very much by the averaging provisions. The other obvious point is that all farmers will benefit from the reduction in marginal rates of tax. That is a benefit which will apply to the whole farm community and the whole farming sector. I find this question somewhat interesting, bearing in mind that the Leader of the National Party of Australia sprang to his feet last Friday to say that I should not be answering questions on taxation in Parliament. When the honourable member for Newcastle asked me a question, the right honourable gentleman said: The tax reform package is currently under debate and legislation is before the Parliament. It is not proper under our Standing Orders for such matters to be canvassed at Question Time. I have let him off the hook by standing up and answering. I could have made him look an absolute mug by sitting here for a week. With his big mouth open, in came the right honourable member for New England trying to protect the Opposition's hopeless position on taxation by denying a questioner on this side of the House the right to a question. As I have answered his colleague's question, I shall now go on to answer the question that I was prevented from answering last Friday by the Leader of the National Party. That question by the honourable member for Newcastle related to a statement by the-- Mr SPEAKER —Order! I remind the Treasurer that, while the rule of relevance is very wide at Question Time, his answer should be relevant to the original question. Mr KEATING —It is, Mr Speaker. The original question was: Can the Treasurer advise the House whether the Government has finalised its taxation reform package? How does the Government's progress in this area compare with-- Mr Sinclair —On a point of order, Mr Speaker: I would be delighted if the Treasurer wanted to answer specific questions asked within our Standing Orders. He has just had submitted that this particular answer is not relevant and as it is not relevant it is contrary to the Standing Orders. If he wishes to get one of his colleagues to ask a question on a matter that is within the Standing Orders, that is a different proposition altogether. Mr SPEAKER —Order! There are two aspects here. The matter which occurred on Friday was concluded before I was able to give a ruling within the Standing Orders and I would have ruled that the question was proper. The caution I gave the Treasurer today was that I trusted that in taking up the extension of that question he would relate it to the question asked today by the honourable member for Page. If he does so, the relevance applies. Mr KEATING —The relevance is that the Government's tax policy is thought through, well conceived, announced, and will be implemented. The honourable member for Page asked me a question in relation to the Government's tax policy, as did the honourable member for Newcastle. What is entirely obvious is that the Opposition has no such coherence in taxation policy, has not got a clue about where it is going in respect of taxation policy, and when Senator Messner, the taxation spokesman for the Opposition, last week gave an interview to Louise Dodson in the Australian Financial Review he gave a very interesting summary of what he believed Opposition tax policy should be. I took him up on the point about his supporting a capital gains tax, with an extension of section 26AAA and other matters. I have had a reply, in a manner of speaking, from Senator Messner, who referred in the Senate to my hysterical imaginings about his discussions on section 26AAA and talked about sinister connotations being put on his views. He also said that we needed a modification to section 26AAA. His whole statement dealt with making senseless points about modification. It is a play on words whether one is dealing with a modification of an existing tax policy or a change. When is a change a modification and when is a modification a change? The long and the short of it is, basically, that the Opposition believes in having a capital gains tax based on section 26AAA of the Income Tax Assessment Act. Senator Messner, in the Opposition's so-called secret document, goes on to say that on equity grounds speculative windfall gains such as lottery wins ought logically to have been included in a capital gains tax. So he proposed to take the whole concept of capital gains taxation even further than the Government has taken it. He proposes not only simply to tax real gains and wash from the calculations the inflationary impact but also to adopt a section 26AAA approach to medium term capital taxation on the basis of the full nominal gain being taxed at the full marginal rates and applying it to lottery wins and everything else. So Senator Messner has made quite clear what Opposition tax policy is. He has walked away from his Leader on any views he might have. When I picked him up on these points in the Parliament he scurried away to the Senate and said he had been misrepresented. The fact of the matter is that the Opposition has a policy which is totally ultra vires that expressed for years by the Leader of the Opposition. It has no thought-through position on taxation, as it has not on wages or public policy generally. What becomes patently obvious is that over time all that the Opposition will do is cavil and carp at the Government's policies while offering no constructive alternative except to try to slither behind a mealy-mouthed attack on the Government on capital gains, while it has a capital gains tax in the offing and in the making. Mr SPEAKER —Order! I suggest that the Treasurer wind up his answer. Mr KEATING —All that we ask is that there be no more double standards from the Opposition on a capital gains tax when it is harbouring proposals to have a capital gains tax-a pernicious, vicious and savage tax at full marginal rates on full nominal gains. Nothing Senator Messner has said will let him off the hook. He has said that the Liberal Party wants a capital gains tax. Therefore, how dare the Opposition criticise honourable members on this side of the House for proposing a capital gains tax when it is contemplating such a tax. Mr DUNCAN —Did the Acting Prime Minister see in this morning's Australian Financial Review an article headed: `States urge banks to take softer line towards customers hurt by card fraud'? I ask whether the Minister saw a comment in that article which, with regard to the recent meeting of Consumer Affairs Ministers, referred to: . . . expressions of dissatisfaction about the Commonwealth Government's progress on the problem. The article further stated: The latest indication is that the Commonwealth would take another 18 months before some legislation is in place. Mr SPEAKER —Order! The honourable member is allowed to use a reasonable amount of information to make his question intelligible, but he is going beyond the bounds in giving a long quotation. I ask him to come to his question. Mr DUNCAN —In view of the importance of this matter, will the Minister say whether this is true and advise the House as to the progress being made in this important matter of setting up legal rules governing the use of and fraud on credit cards? Mr LIONEL BOWEN —The Government has formed an inter-departmental committee which also comprises observers if not representatives from State governments to talk about the question of fraud in relation to the electronic transfer of funds. There have been a number of discussions. I did not attend the last ministerial meeting of Consumer Affairs Ministers, but I am aware that consumers are very concerned that fraud could be perpetrated and that they would be held responsible. The State governments are quite right in saying that they also have a responsibility, particularly as it relates to building societies and credit unions which are also involved in what is called electronic transfer of funds. It is incorrect for the article to suggest that the Commonwealth is not interested. It is incorrect to suggest that the Commonwealth would delay the matter. The issue at present is that there is no legislation which protects consumers involved in fraud by this method of transfer of funds. Naturally, the banks are also concerned and are perhaps reluctant to suggest that there could be a liability on them. One has to look at the balance of the situation. The consumer has to be protected and, should the consumer not be protected, those who would be liable have to be assured that a fraud has been perpetrated. In other words, with a card system, someone could use a card and, although the normal customer may not be using the card, it may not necessarily be a fraud. There is that difficulty. It is important that we have protective devices for the consumer. It is novel in the sense that this type of crime is well known across the world and is increasing. It requires a co-operative effort between the Commonwealth and the States. I am happy to say that the IDC established by the Treasurer is working towards that end. I am anxious that, if a regime can be established, we should have legislation at the earliest opportunity to guarantee that all bona fide customers or consumers will be compensated in the normal way when such fraud has been perpetrated. At present, as the honourable gentleman knows, if fraud can be established with respect to cheques and other mechanisms, the liability is not on the customer or the consumer. That is the issue here. The question is whether there can be some method whereby a customer could be deemed to be guilty of negligence in allowing the card to pass out of his or her hands. I am sure that the matter can be dealt with effectively. It will require advice from both the Federal Government and State governments as to how best it can be done. It is agreed by all Ministers that it is better to have uniform legislation and I am anxious for that uniform legislation to be introduced at the earliest opportunity. Mr JULL —My question is directed to the Treasurer. In light of the fact that up to 1,000 people have now lost their jobs in the restaurant and catering industry in Queensland alone in the past fortnight, and that concern has been expressed by a number of industries especially in the primary sector at the effects of the termination of entertainment expenses, can the Minister advise what will be the total saving to revenue of this measure? Will this be counteracted by the loss of income tax, excise and other receipts? Is the Treasurer prepared to re-examine his proposals to try to determine a better system whereby tax deductibility may be allowed for legitimate entertainment expenses in restaurants? Mr KEATING —Can I answer this one, Ian? Mr Sinclair —Yes, Paul. Mr KEATING —This one is all right, is it? Mr Sinclair —Within reasonable time constraints, yes. Mr KEATING —I will just say this about the Liberal Party of Australia: For 25 years in this Parliament members of the Liberal Party have worked hot to work out how their people could dodge the 60 per cent rate by leaving all of these loopholes in the tax system. They never worried about all the tax shelters; they kept putting more in because they always knew that, as people's incomes were inflated through the tax scales, as the burden fell more and more substantially on low and middle income earners, the people they represented would not have to pay because they had worked out all the loopholes in the system. That is why they are now smarting. The fact is that we have actually removed the opportunities for minimisation by cleaning up all of those tax shelters. There is now this interest about the entertainment sector which goes not simply to a minimisation of their income but actually even disturbs their lifestyle. They may even wear the effects on their income but they do not like it to disturb their lifestyle. They like having their lunch with the Commissioner of Taxation picking up 46 per cent of the bill. One has to draw a very long bow in looking at the effects upon employment in the restaurant industry as last week we saw figures showing an employment growth of 56,000 people in one month. Honourable members opposite are talking about 1,000 people employed in the restaurant industry being affected. I do not know whether they are right about that or not. I notice that another economic rationalist at the back of the chamber is chipping in with his tuppence worth about free meals. It is too early to say what the impact will be on employment in the restaurant industry. I am told that it may affect some restaurants differently from others and that, so far, some restaurants are not affected by the measures at all. Some seem to have been affected but not as greatly as they feared. Making premature judgments and relying on assessments by analysis organisations which have produced reports with horrendous employment effects are hardly the sorts of things for the Parliament to take notice of. We are seeing a very strong employment growth in the economy at the moment. If there is any displacement in this sector it can be taken up elsewhere. There is no case for any one sector of commerce in this country having its employment or its prosperity underpinned by a tax shelter. Of course, if we provide tax concessions for any one sector of commerce versus another, that sector will enjoy more prosperity relative to other sectors of the economy. That is very clear; we can see it from the proliferation in the number of restaurants over the last decade or so. I have very grave reservations as to whether entertainment should ever have been allowed as a deduction in the tax system. Given the fact that it has been widely abused and exploited in the shameless way in which it has, I think the cries of a lot of people in the industry are cries for the continuation of a position of privilege which they enjoyed. I make it quite clear that this does not affect the whole industry. It certainly affects business meals, drinks, cocktail parties, staff functions, et cetera; but conventions and conferences at which meals are not in the category of entertainment are still deductible. Therefore, the convention industry, which is growing in this country as convention facilities are being made available, will still have meals as a deductible expense, as indeed will be the case with staff canteens and the like. This notion that the removal of the tax deductibility of restaurant meals will devastate this whole component of the leisure industry, particularly the convention industry, is simply not true. We will have to wait for some time yet to see what the full employment consequences will be in this industry. Again, it can only encourage a change within the community for those people who wish to have their meals out by requiring them to go to places where they can afford to go without deducting it from their taxable income. I suggest to the honourable member that he regard the change as a need to make the tax system more fair, more equitable and more efficient. In that case we will see a more dynamic economy with more employment growth. What has been a subsidy to one industry will end up being a benefit to the whole economy and with a benefit to the whole economy, we will simply see a far stronger economy and more aggregate employment. So the honourable member's fears about employment losses in the restaurant industry ought to be weighed against that fact. Mr LANGMORE —Is the Special Minister of State aware of threatened industrial action by the Australian Federal Police Association which includes the threat not to enforce the traffic laws in Canberra? Will the Minister meet with the Association to discuss the matter? Mr YOUNG —I thank the honourable member for Fraser for his question. Yes, I am aware of the matters raised by the Canberra branch of the Australian Federal Police Association. In the last couple of weeks I had occasion to address the national conference of the Association and raised some of the matters which it now wishes to discuss with me, including the question of police resources as it affects the Australian Capital Territory as well as the question I raised regarding lateral recruitment into the Australian Federal Police. I have met with members of the newly elected executive of the AFPA since that conference last week and it was intended that I meet with them again next week in Adelaide, but I understand that arrangements are to be made that I will meet them here. I can tell the honourable member for Fraser that I can understand the frustration of some of the people in the Australian Capital Territory, perhaps as a result of meeting with members of the national executive on an agenda which deals with matters basically concerning policing operations outside the Australian Capital Territory. Because of the demands of the work load outside Canberra there has been a tendency for people within the Australian Capital Territory to have the impression that perhaps it was getting a lower priority. This has not been the case. As I said to the Parliament earlier, in a comparison with the major States the Australian Capital Territory is only second after South Australia in having police per head of population available to it; so it is in a very good position compared with the States and there has not been any tendency by either the Fraser Government or this Government to deplete the police resources available to Canberra. I want to reiterate that the demands made on the Australian Federal Police over the last six years, since its emergence in that concept, have changed very dramatically and most of the demands made on the Commonwealth law enforcement agency have been outside Canberra-in the major criminal and white collar crime areas. Looking ahead at what sort of operations the police would have in Australia, we would have to predict that that is where the growth will continue to be. I raised the question of lateral recruitment not on the basis that the Government had made a decision in conjunction with the Commission that this is what we were going to do but rather on the basis that the Association ought to think about these matters, because obviously in dealing with some of the sophisticated crime that is operating in Australia at the moment there may be a need for the Government to discuss with the Association the need to bring more professional people into the police to deal with these questions. Any of the matters which I raised at the Association conference can be discussed with the Association from the conceptual stage before any decision is taken. I can also reassure both the honourable member for Fraser and the honourable member for Canberra, who were good enough to lead a delegation to me last week of concerned people in the community, that whenever matters concerning Canberra are on the agenda of the national executive of the Association, I have asked it to make sure that people from the Canberra branch of the Association are present on that delegation. In dealing with these matters I do not think there is any reason why the local branch of the Association should be calling for industrial action. The door has been open for the negotiations to take place on all of these matters. I would just like the Parliament and the Canberra branch of the Association to understand that the decisions on the operation of the Federal Police are not a matter for the Minister, but are a matter for the Commissioner, and he will continue to make them in terms of the resources that are made available to the Australian Federal Police. It may be of interest to honourable members to know that the police college at which the recruits are taken in, at Weston, in Canberra, will be working at capacity from January 1986 until June 1986, using up all the recruits that will be made available to it as a result of the $10m promised to it from the last election by the Prime Minister. So I suggest to the members of the Association who are thinking of taking industrial action that these matters should be set aside until discussions are held between the Association, which includes this branch, and me. Mr PETER FISHER —My question is directed to the Minister for Employment and Industrial Relations. What is he doing to curb the activities of organisers of the Builders Labourers Federation who have black-banned non-unionist contractors from building work in my electorate and have threatened, and forced union levies upon, both work experience students and their employers? Will he ensure that these valuable work experience programs are able to continue without this thuggery? Mr WILLIS —I am not aware of the specific examples that the honourable member raises in his question but I am aware of the general issue he raises. Let me say first that the Builders Labourers Federation has engaged in various activities which this Government has criticised. As a result, we have taken unprecedented action to try to eradicate those practices and, in particular, have taken action against the Federation as such to remove it from the industrial relations system. In relation to the question of forcing people on work experience or job creation programs to become members of the union and to pay union fees, I took up that matter with the Australian Council of Trade Unions some time ago. The ACTU was unable to get the BLF to change its practices to any substantial degree. It is a matter which continues to concern me. I understand that various people who have been unemployed for a long time and have got a job in the building industry have been faced with the demand immediately to pay a very substantial amount of union fees-for half a year or so, which in the case of the BLF is well over $100. That is an amount of money which many people cannot find easily when they have been unemployed for a long period. It is a matter which concerns me very much. I will continue to do my best to change that, but I suspect that the only real way by which we will change it is to take that fundamental action against the BLF in which we are engaged. Mr TICKNER —Has the Minister for Trade seen the allegation that the foreign tax credit system proposed by the Government would discourage Australian investment in South East Asia and disadvantage Australia in its trade with China? Mr DAWKINS —I have seen such references-that if the Government proceeded with its decision in relation to the foreign tax credit system, this would disadvantage Australia's trade performance, particularly in the region. It is important to point out that in the Treasurer's statement of 19 September he indicated that in proceeding with the foreign tax credit system the Government would take appropriate measures to recognise the position of Australian investment in regional countries. The Government wants to encourage Australian investment in those areas where it will encourage trade between Australia and those developing countries. A number of Australian companies have invested in the region and those investments have been important in encouraging and fortifying the trade relationships between Australia and those countries. I think there has been an attempt to make some mischief with this announcement. I indicate, as did the Treasurer on 19 September, that we are alert to these concerns and, well before the introduction of this new scheme foreshadowed for July next year, we will have an opportunity to consider those on a case by case basis. This reference was made by the Leader of the Opposition in a speech to the Melbourne Chamber of Commerce, a speech which was distinguished only by the extent of the gross inaccuracies contained in it. This particular inaccuracy was probably one of the most glaring of all. One always has a choice when one is considering the inaccuracies to which the Leader of the Opposition puts his name. His inaccuracies can be either deliberate misrepresentations of the kind for which he is famous-a particular example of that was his deliberate misrepresentation at the time of the 1983 election, when he withheld from the Australian public the prospect of the $9.6 billion deficit for Australia in 1983-84-or they can be further evidence of his compulsive misery. Time and time again the Leader of the Opposition has made predictions of dire prospects for the Australian economy, all of which have turned out to be untrue. Of course, it has been a matter of monumental disappointment for the Leader of the Opposition that his prophecies of doom for the Australian economy have not been realised and that, instead, the Australian economy is doing infinitely better; in fact, it has put into the shade completely the Australian economy's performance during the time when he had the task of determining economic policy. Or, alternatively, the third choice that one has when confronted with inaccuracies from the Leader of the Opposition is that he is just plain wrong. Of course, there have been so many occasions on which the Leader of the Opposition, when he was Treasurer, was just plain wrong. It is perfectly clear that the rest of the members of the Opposition have a very short recall of memory when it comes to his performance. But it is important to remember that in each of the five Budgets for which he was responsible, expenditure outlays were in excess of those predicted at Budget time. If one goes to the question of deficit projections, one finds that he was wrong on three out of five occasions. If one goes to the question of predictions of unemployment, one finds that he was wildly wrong on most occasions. The only point I want to make is that in that speech, which, as I say, was celebrated only by the extent of the inaccuracies within it, the Leader of the Opposition made certain undertakings about what a government led by him would do in the area of taxation. One has only to look at his record when he had the opportunity to do things, to realise that one should take absolutely no account of what he says. He has demonstrated time and again that in office and out of office he is totally unreliable. Mr HOWARD —I refer the Acting Prime Minister to the statements made last Friday by the Prime Minister regarding the relationship between the present Australian Government and the United States Administration. Has the Prime Minister yet conveyed to the United States Government the support of the present Australian Government for the action taken by the United States last Friday against the suspected hijackers of the Achille Lauro? If not, will the honourable gentleman do so? Mr LIONEL BOWEN —It is a fair question. I am not aware of it; if it has not been done, I will arrange for it to be done. Mr FREE —I direct my question to the Minister for Science. Is it a fact that Australia has, until now, not been invited to attend a summit conference of the seven major Western industrial powers? Is it also a fact that Australia will be attending the Ottawa summit next week? If so, will the Minister provide details? Mr BARRY JONES —The answer to all three questions is yes. The Ottawa summit of 20-21 October is the sequel to the conference of the Organisation for Economic Co-operation and Development held in Venice in April 1985, where Ministers from the 24 nations discussed technology and job creation. My invitation to this conference was at the instance of Japan, the United States, Canada and Italy. It is to be hoped that this will be a forerunner of Australia's permanent representation at northern summit conferences. The meeting will consider policies for promoting promising technologies and industries, the role of government vis-a-vis industry and industrial research and development innovation, and planning and co-ordination of science and research. I have been asked to lead the discussion on the first of these subjects. The invitation is also a confirmation of the old adage about prophets not being without honour. Mr GOODLUCK —Is the Minister representing the Minister for Resources and Energy aware that petrol pricing in this country is a real mess? Is the Minister aware that the Prime Minister said that he would reduce the price of petrol? Is the Minister aware that petrol prices have increased by about 10c to 12c a litre since his Government came to office? Mr Charles —Nonsense! Mr GOODLUCK —No, it is not damned nonsense; it is an absolute fact. Is the Minister aware that the disparity in the price of petrol throughout this country is having a very dampening effect on the rural economy and also on States such as Tasmania, in which people are paying 60c a litre-- Mr SPEAKER —Order! The honourable member must come to the point of his question. Mr GOODLUCK —I am coming to the point now with a positive request. Will the Minister give consideration to the formation of a select committee or a joint committee, comprising Labor, Liberal and National Party members, to look into the price of petrol and get it away from the bureaucrats, get it away from the judges-- Mr SPEAKER —Order! If the honourable member continues in the same manner he will be asked to resume his seat. He should get to the point of his question. Mr GOODLUCK —Will the Minister give consideration to the formation of such a committee so that we can have a good look at the pricing of petrol in this country and make it fair for every decent Australian? Mr BARRY JONES —I will pass on the honourable member's views to my colleague the Minister for Resources and Energy, who no doubt will give them appropriate weight. However, it needs to be pointed out that in April of this year Australia actually had the lowest petrol prices of the 24 Organisation for Economic Co-operation and Development nations. Mr Porter —Including the United States? Mr BARRY JONES —Our prices were lower than those of the United States in April. Considering that the United States is such a prodigious producer, the fact that our metropolitan prices were so low was a great tribute to the policies of this Government overall. There is no question that the enormous variation in petrol pricing, as honourable members well know, is due to the huge size of our country, the dispersal of its population and the inevitable high distribution costs in between. These problems have not arisen under this Government. They are endemic problems. As long as we have an industrialised economy based on the distribution of fuel we will have enormous variations in fuel costs because of distance. It seems to me that that is not a problem that can be overturned by setting up a conference or a committee, no matter how well intentioned. Essentially, that would mean redistributing the burden so that the great bulk of urban petrol consumers would be paying more in order to subsidise the delivery costs in the bush. I hear Telecom Australia cited by an honourable member as an example. That is an absolutely fundamental question that would need to be looked at in a Budget context. As I say, I am prepared to refer the honourable member's question to Senator Gareth Evans for his comment, but basically I do not think it will change the situation. Mr KEATING(Blaxland-Treasurer) —For the information of honourable members, I present the Department of the Treasury annual report for 1984-85. Mr KEATING(Blaxland-Treasurer) —Pursuant to section 125 of the Insurance Act 1973, I present the Insurance Commissioner's annual report for 1984-85. Mr YOUNG(Port Adelaide-Special Minister of State) —Pursuant to section 25 of the Commonwealth Grants Commission Act 1973, I present the Commonwealth Grants Commission fifty-second report for 1985. Mr HURFORD(Adelaide-Minister for Immigration and Ethnic Affairs and Minister Assisting the Treasurer) —For the information of honourable members, I present a statement on expenditure from the Advance to the Minister for Finance for August 1985. Mr PETER MORRIS(Shortland-Minister for Aviation) —For the information of honourable members, I present the annual report of Qantas Airways Ltd for 1984-85. Mr HOLDING(Melbourne Ports-Minister for Aboriginal Affairs) —For the information of honourable members, I present a report by the Aboriginal Land Commissioner on the Mount Allan land claim. Motion (by Mr Young) proposed: That the House take note of the paper. Debate (on motion by Mr N. A. Brown) adjourned. Mr HOLDING(Melbourne Ports-Minister for Aboriginal Affairs) —For the information of honourable members, I present a further report by the Aboriginal Land Commissioner on the Gurindgi land claim to Daguragu station. Motion (by Mr Young) proposed: That the House take note of the paper. Debate (on motion by Mr N. A. Brown) adjourned. The Clerk —Petitions have been lodged for presentation as follows and copies will be referred to the appropriate Ministers: To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned citizens respectfully showeth that they are opposed to the proposals contained in the Government's White Paper for the reform of the Australian Tax System in so far as they relate to the imposition of further capital gains and wealth taxes. Your petitioners humbly pray that the House of Representatives in Parliament assembled will call upon the Government to reject any proposal to increase the burden of capital gains and wealth taxes on the Australian people. And your petitioners as in duty bound will ever pray. by Mr Beale,Mr Ian Cameron,Mr Tim Fischer,Mr Halverson,Mr Reith,Mr Shack,Mr Slipper,Mr Smith,Mr Tuckey,Dr Watson and Mr White. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia showeth that whereas: 1. They are completely satisfied with the design of the existing Australian National Flag. 2. They are aware it properly reflects the immutable characteristics of Australia, namely: (a) The Union Jack, itself the creation of three Christian Crosses, represents the Nation's historic origin and the source of its language and law; (b) The Southern Cross on an azure blue background signifying its geographic location on this planet Earth; (c) The large star depicting the advent of federation in 1901. 3. They know the Flag has been a source of inspiration to generations of Australians in peace and war. 4. They recall that millions of native-born Australians and newcomers to these shores from other parts of the world have become united under its proud symbolism. 5. They are certain that any change to the Flag will produce division in the Australian community. Your petitioners therefore pray that your honourable House will: Propose and pass a motion that ``the existing Australian National Flag be changed only with the approval of the Nation as expressed in a referendum''. And your petitioners as in duty bound will ever pray. by Mr Beale,Mr Duffy,Mr Halverson,Mr Hawker,Mr McArthur,Mr Peacock,Mr Shipton and Mr Staples. 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 the overwhelming majority of Australians are completely satisfied with the existing Australian National Flag. 2. That we are totally opposed to any change in the Australian National Flag as provided in Section (3) of the Flags Act, unless such proposed change is first voted on by the people of Australia and passed by a majority of voters in a majority of States. And your petitioners as in duty bound will ever pray. by Mr Drummond. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned respectfully showeth: 1. That the overwhelming majority of Australians are completely satisfied with the existing Australian National Flag. 2. That we are totally opposed to any change in the Australian National Flag as provided in Section (3) of the Flags Act, unless such proposed change is first voted on by the people of Australia and passed by a majority of voters in a majority of States. And your petitioners as in duty bound will ever pray. by Mr Fife. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of certain citizens of Australia respectfully showeth: That the Australian flag symbolises the continuity between Australia's past, its present and the future; That the presence of the Union Jack on the flag represents not a subservience to Britain, but a reminder of our inheritance of the fruits of hundreds of years of struggle for individual liberty against the forces of tyranny and oppression; Nonetheless recognises the rights of Australians should they wish as a people to change the design of their flag. Your petitioners humbly pray that no change be made to the Australian flag except with the consent of the people in a referendum. And your petitioners, as in duty bound, will ever pray. by Mr Ruddock. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned shows: That the proposed introduction of compulsory identification (ID) cards should be reconsidered and rejected because the system: (a) is not a cost-effective method of reducing tax evasion and social security fraud and, to the contrary, in the form proposed will facilitate such evasion and fraud; (b) will constitute an unwarranted infringement of individual privacy by the aggregation of a wide variety of personal information of a private nature; (c) will cause a further large and costly growth in the bureaucracy and burden on the taxpayer; and (d) cannot be guaranteed against misuse for purposes other than for which their introduction is stated to be intended and in fact provide the opportunity for blackmail and other forms of misuse. And your petitioners humbly pray that the problems which identification cards are intended to reduce should be attacked by other, more effective and less obnoxious methods. And your petitioners, as in duty bound, will ever pray. by Mr Burr,Mr Downer and Mr Goodluck. To the Honourable the Speaker and Members of the House of Representatives assembled in Parliament. The petition of the undersigned respectfully showeth: Introduction of any additional capital gains taxes, wealth taxes or death duties is opposed on the grounds that: they adversely affect the small and medium size businesses in Australia, destroying incentive and discouraging investment in this important area of the economy; the Australian economy, and employment in particular, is heavily reliant on growth in small businesses; any capital gains that might result when owners of small businesses finally sell the business are not ``windfall gains'' but the result of many hard years of work and sacrifice, with very little being taken out of the business by way of salaries so that the maximum amount of money can be ploughed back into the business to create growth and jobs; the owners of small businesses often depend on a capital gain-which are simply deferred salaries-when they eventually sell their business to sustain them in retirement; Your petitioners request that the House of Representatives, in Parliament assembled, will protect the rights of private enterprise and reject any inequitable additional taxes. And your petitioners as in duty bound will ever pray. by Mr Cadman,Mr Fife and Mr McArthur. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned respectfully showeth: 1. That we are completely dissatisfied with the frequent and substantial increase in the price of petrol and diesel fuel. 2. That we are aware that these price increases have an adverse affect on the living standards of the average Australian wage earner. 3. That increases in fuel prices add to farm costs and further reduce the average income per farmer which has already fallen to one-third of national earnings. Your petitioners therefore pray that the Government will immediately reduce the price of petrol by three (3) cents per litre in line with the commitment given by the now Prime Minister of Australia during the 1983 election campaign and take all possible action to prevent further increases occurring. And your petitioners as in duty bound will ever pray. by Mr Fife and 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 Australia respectfully sayeth: That we the undersigned are totally opposed to any taxation change which involves a tax on Health Fund contributions, health charges or benefits; That we are already required to pay a 1 per cent levy to partly finance the Medicare scheme and that we would regard any further taxation of our health insurance arrangements as unfair and unreasonable; That therefore we urge the Government to ensure that there is no taxation on illness and no special taxation on those who seek to insure themselves against the cost of private health care. And your petitioners as in duty bound will ever pray. by Mr Fife and Mr Ruddock. To the Honourable Speaker and Members of the House of Representatives in Parliament assembled, we the undersigned call upon all Members to pay due respect to all returned service personnel. Your Petitioners therefore humbly pray that all changes to benefits for veterans, and conditions of service for military personnel, as announced in the May Economic Statement, be withdrawn as to allow sufficient time for sensible community debate before any veteran or service person can be unfairly disadvantaged. by Mr Blunt. 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 that: The Labor Government's policy of automatically increasing the A.B.R.D. fuel levy when the C.P.I. increases, perpetrates inflation, increases the cost of goods to country people, reduces the living standards of all Australians, short changes motorists as the extra funds raised are not spent on roads. Your petitioners humbly pray that the House of Representatives in Parliament assembled, urge the Government to: Give Australian motorists a better deal and immediately repeal those legislative provisions that automatically increase the price of petrol when the C.P.I. increases. And your petitioners as in duty bound will ever pray. by Mr Blunt. To the Right Honourable Speaker and Members of the House of Representatives assembled. Your petitioners humbly pray that the House of Representatives, in Parliament assembled; should disallow the new Customs and Objectionable Publications Ordinance and that: The Attorney-General enforce laws to prevent the importation and sale of hard-core pornography (e.g. X-rated videos) and publications which consistently incite the use of hard drugs; The importation and sale of grossly obscene publications, including those associated with blasphemy be prevented; Imported video tapes/discos for non-commercial use to be registered by the Films Censorship Board; Censors more appropriately reflect responsible attitudes; Further measures be taken in association with States to protect Australians, particularly women and children, from exploitation; and That, because of the importance of this issue to society, a conscience vote be permitted to all Members of Parliament. And your petitioners as in duty bound will ever pray. by Mr Blunt. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned citizens of the Commonwealth of Australia respectfully showeth: That we deplore the discriminatory tax proposals as outlined in the Government's `White Paper' and the Government's preferred option on proposed new and widened tax proposals as so outlined, namely: Capital Gains Tax Hidden Death Tax described as `Capital Gains Tax after death' Gift Tax Increased Company Tax Employer taxes on employees' employment benefits All such taxes will discriminate against and inhibit progress, growth and employment throughout the nation. They will attack hardworking people who have built up their assets; they will discourage thrift; they will inhibit development; they will treat unfairly all who plan for the future; they will cause trouble and expense in arriving at the value of their assets; they will discourage industry and punish achievement. Your petitioners most humbly pray that the Members of the House of Representatives in Parliament assembled should immediately reject these tax proposals. And your petitioners, as in duty bound, will ever pray. by Mr Blunt. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of certain citizens of Australia respectfully showeth: That all steps be taken to prevent the continuous erosion of the rights of the holders of freehold land. Your petitioners draw to the attention of Parliament the denigration of freehold rights as practised in New South Wales and calls on the Parliament to enact overriding legislation to allow full and proper compensation to all Australians where Government requires the use of private property and traditional rights attached thereto. 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 that the current policies of the Community Arts Board of the Australia Council are disadvantaging rural residents with regard to access to the Arts. Your petitioners, therefore, humbly pray that the Federal Government will allocate sufficient funds to the Australia Council specifically to ensure ongoing funding to State Arts Councils to enable those organisations to maintain access to performing and other arts activities in country areas. And your petitioners, as in duty bound, will ever pray. by Mr Ian Cameron. To the Honourable the Members of the House of Representatives in Parliament assembled, the humble Petition of The South Australian Country Women's Association Incorporated and the undersigned shall showeth. The necessity to restore the concessional price of fuel in rural areas-without which there will be increased freight and production costs. Your petitioners therefore pray that your honourable house will restore concessional price of fuel in rural areas for the benefit of all Australians. And your petitioners as in duty bound will ever pray. by Mr Downer. To the Honourable the Speaker and the Honourable Members of the House of Representatives in the Parliament assembled. The humble petition of the undersigned citizens of Australia showeth that whereas: 1. They are completely satisfied with the design of the existing Australian national flag. 2. They are aware it properly reflects the immutable characteristics of Australia, namely: (a) The Union Jack, itself the creation of three Christian Crosses, represents the nation's historical origin and the source of its language and law; (b) The Southern Cross on an azure blue background signifying it geographical location; (c) The large star depicting the advent of Federation. 3. They know the flag has been a source of inspiration to generations of Australians in peace and war. 4. They recall that millions of native-born Australians and newcomers to these shores from other parts of the world have become united under its proud symbolism. 5. They are certain that any change to the flag will produce division in the Australian community. Your petitioners therefore pray that your honourable House will give a speedy passage to the Flags Act Amendment Bill which provides that the Australian National Flag can only be changed by a referendum. And your petitioners as in duty bound will ever pray. by Mr Drummond. 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: That in the light of the Labor Government's failure to act to correct the many anomalies in the Assets Test on pensions brought to its notice, the Labor Government's legislation should be repealed before it has an unduly unfair impact on pensioners. Your Petitioners therefore humbly pray that the House of Representatives in Parliament assembled should immediately seek the repeal of the Labor Government's iniquitious and unfair Assets Test. And your petitioners, as in duty bound, will ever pray. by Mr Hawker. To the Honourable the Speaker and the Members of the House of Representatives in Parliament assembled. The humble petition of citizens of Australia shows: That the people of New Zealand and the New Zealand Government have given an example to the world in their efforts to achieve a nuclear free South Pacific, and such decision being endorsed by the people at a general election. Your petitioners therefore pray that the Australian Government support the principled stand taken by the New Zealand Government and urges it to condemn any efforts by the U.S. Government to impose economic or other sanctions on New Zealand in retaliation for their stand on nuclear vessels. We further urge the Australian Government to urgently implement its policy to promote the development of zones of peace and nuclear free zones in the Indian and Pacific Oceans. And your petitioners as in duty bound will ever pray. by Mr Kent. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned respectfully showeth: We are concerned that the closure of the Enterprise Migrant Hostel will be detrimental to the long-term settlement prospects of migrants in Victoria as well as detrimental to Ethnic Communities who have settled in the Springvale area. In addition, the long-term development of commerce and industry in the area will be adversely affected. We urge the Government to reverse this decision. And your petitioners as in duty bound will ever pray. by Mr Kent. To the Honourable Speaker and Members of the House of Representatives in Parliament Assembled. We the undersigned citizens of the Commonwealth do humbly pray that the Commonwealth government 1. Unhold the principle that the seeds and cuttings of plants are a public resource and a common heritage to all and that accordingly seeds should be freely available to all, freely multipliable able to be sold, exchanged, exported and imported by anyone who wishes. This is seen as a matter of national food security. 2. Recognise that plant breeding is a highly co-operative venture often involving private enterprise at the very last stages after basic seed collection, storage, and research has been publicly funded. 3. In view of the aforementioned paragraphs, recognise that any system giving `property' or ownership right over seeds to individuals, organisations or enterprises is inappropriate and unjust. 4. Recognise that legislation establishing plant patenting schemes overseas has had serious adverse effects namely: (i) a slow-down of scientific information exchange and exchanges in basic plant breeding materials, that is, germ plasm, (ii) subordination and/or curtailment of public breeding programmes, (iii) farmer unrest at seed prices. (iv) monopoly control of seed production and sales has passed into the hands of giant petrochemical and drug corporations also marketing crop chemicals, (v) increased uniformity of crop varieties leading to a vulnerability to pest and disease attack. 5. Reject any proposal to legislate for any system such as the drafted Plant Variety Rights Act, which gives exclusive ownership rights over seeds to individuals, organisations or enterprises. And your petitioners, as in duty bound, will ever pray. by Mr Milton. To the Honourable Speaker and Members of the House of Representatives, the Petition of the undesigned respectfully showeth: That the recent cuts announced in the Mini-Budget to Prescribed and Day Care Services are a reversal of A.L.P. policy to make child care services available to all at an affordable cost. Further, that the fee rises arising from the cuts will cause great hardship to the majority of families using these services. Your petitioners therefore humbly pray that your honourable House full restores all Federal funding to children's services in Australia. And your petitioners as in duty bound will ever pray. by Mr Nehl. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. This petition of concerned Australian citizens respectfully points out: That for our survival, an effective Worldpeace Initiative needs to be established which will work towards mutual understanding, world disarmament, economic well-being for all fulfilling employment, a sustainable conservative natural resources and revitalising soils essential for growing a plentiful and healthy food supply and tree cover. By achieving these objectives, Australia can set an example for the rest of the world to follow. Your petitioners therefore humbly pray that your Honourable House will: 1. Create an Australian Ministry for Peace specifically devoted to peace-building and the non-violent resolution of conflict; 2. Convene a national Summit for Survival to discuss the issues of world dissarmament, security and national and international co-operation; 3. Support the United Nations World Disarmament Campaign by allocating the equivalent of at least 10% of our military expenditure to fund peace activities; 4. Actively assist the International Year of Peace in 1986 by initiating programs for peace education, self help development and environmental repair; 5. Develop National Employment Programs to give priority to the planting and growing of forests, food-producing trees and other crops to assist the greening of Australia. 6. Implement National Recycling Programs to reuse water and to compost all presently wasted domestic sewage-sludge and organic garbage with mineral-rich gravel dust, a by-product from rock quarries and mines, into hygienic humus, a natural fertiliser, for use in revitalising impoverished soils. 7. Propose to the United-Nations General Assembly that 1989 be declared International Year for Repairing the Earth. And your petitioners as in duty bound will ever pray. by Mr Ruddock. To the Honourable the Speaker and Members of the House of Representatives in parliament assembled. This petition of concerned Australian citizens respectfully points out: That, for our survival, an effective Worldpeace Initiative needs to be established which will work towards mutual understanding, world disarmament, economic well-being for all and full employment. This Initiative will help to ensure a sustainable society conserving natural resources, and revitalising soils essential for growing a plentiful and healthy food supply and tree cover. By achieving these objectives, Australia can set an example for the rest of the world to follow. Your petitioners therefore humbly pray that your Honourable House will: 1. Propose to the United Nations General Assembly that 1989 be declared International Year for Repairing the Earth. 2. Implement action programs leading up to 1989 which will include: (a) Actively supporting the International Year of Peace in 1986 by reallocating at least 10% of our military expenditure to fund environmental repair programs. (b) Implementing National Recycling Programs to reuse water, and to compost into hygienic humus all presently wasted organic garbage and sewage-sludge mixed with fine ground powder from mineral-rich gravels and rocks, to use as a natural fertiliser in revitalising impoverished soils; (c) Developing National Employment Programs to give priority to irrigation systems and the planting and growing of healthy forests, food-producing trees and other crops and vegetation to assist the greening of Australia. And your petitioners as in duty bound will ever pray. by Mr Shipton. To the Honourable Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth: That the Veterans' Entitlement Bill dated May 1985 is taking a fair `earned service' from the men and women of Australia, who kept this country free so that Governments of today could have the freedom to be able to Govern fairly. Your petitioners therefore pray that the House of Representatives in Parliament assembled ensure that the previous legislation in respect of Servicemen and Women and their dependants entitlements be restored. And your petitioners as in duty bound will ever pray. by Mr Sharp. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled; the humble petition of the undersigned citizens of South Australia showeth that: Without any warning and at the worst possible moment, the Federal Government has abandoned the pensioner patients in South Australia's Nursing Homes. These people are suffering undeserving hardship and trauma as a result of the Federal Government's decision to freeze the nursing home benefit levels in South Australia. The pensioner patients and those on fixed incomes now cannot expect any relief from recent significant fee increases approved by the Department of Community Services and which have coincided with the decision to freeze benefits. 80-85% of nursing home patients are pensioners and the majority are now required to pay in excess of their pension for their nursing care for the very first time. Some are paying over $5 per day on top of their pension. Many are looking for cheaper nursing care that doesn't exist. We request that the Federal Government: 1. alleviate the distress of South Australia's nursing home patients and their families by effective restoration of the principle that pensioner patients should not have to pay more than their pension for nursing home care 2. restore the review of the benefit rates in November 1985 3. resolve its concerns over health care costs with the South Australian Government rather than inflicting unnecessary suffering on nursing home patients. And your petitioners, as in duty bound, will ever pray. by Mr Downer and Mr Wilson. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Richmond electorate respectfully showeth that: The Hawke Labor Government's ban on negative gearing and restrictions on property depreciation will adversely affect thousands of disadvantaged people who rent their homes. Your petitioners humbly pray that the House of Representatives, in Parliament assembled, urge the Government to: End its ill-considered and discriminatory policy on rented property and allow depreciation on all buildings used to produce rental income. And your petitioners as in duty bound will ever pray. by Mr Blunt. To the Honourable Speaker and Members of the House of Representatives in Parliament assembled. The Petition of citizens of New South Wales respectfully showeth: 1. Badgery's Creek and surrounding district are unsuitable sites for any major airport due to environmental, conservation and weather factors. 2. Many hundreds of people will be dislocated and many thousands more will be disturbed by the siting of an airport at Badgery's Creek and surrounding districts. 3. N.S.W. taxpayers cannot afford the cost of a second airport when at a minimum of cost upgrading and expansion of Kingsford Smith will satisfy the needs of N.S.W. air travellers in the foreseeable future. Your Petitioners therefore humbly pray that your Honourable House will not approve an airport at Bagdery's Creek and surrounding districts. And your petitioners, as in duty bound, will ever pray. by Mr Grace. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled: The petition of certain Wollongong citizens of Australia (electors of the Division of Macarthur) shows-Living Sound Radio (here circumstances of case stated) has been allocated 1045 MHz on FM Radioband and has blocked out all Sydney FM Radio reception. Those stations affected are: 2 Triple M and 2 Day FM. Your petitioners therefore pray that-(1) They allocate to another frequency. (here terms of action petitioned stated) (2) Reduce power output transmission. by Mr Martin. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of certain citizens of the Federal Division of Fisher in Queensland respectfully showeth: That the Hawke Socialist Government be called upon to remove the unjust and cruel Assets Test; That the Assets Test discriminates grossly against those people living on acreage blocks or in rural areas; That the introduction of the Government's grab for the assets of senior citizens is condemned as un-Australian; That the Government is requested to reconsider the Assets Test. And your petitioners as in duty bound will every pray. by Mr Slipper. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of certain citizens of the Federal Division of Fisher in Queensland respectfully showeth: 1. They are completely satisfied with the design of the existing Australian National Flag. 2. They are aware it properly reflects the immutable characteristics of Australia, namely: (a) The Union Jack, itself the creation of three Christian Crosses, represents the Nation's historical origin and the source of its language and law; (b) The Southern Cross on an azure blue background signifying its geographical location on this planet Earth; (c) The large star depicting the advent of Federation in 1901. 3. They know the Flag has been a source of inspiration to generations of Australians in peace and war. 4. They recall that millions of native-born Australians and newcomers to these shores from other parts of the world have become united under its proud symbolism. 5. They are certain that any change to the Flag will produce division in the Australian community. Your petitioners therefore pray that your honourable House will: Propose and pass a motion that ``the existing Australian national flag remains sacrosanct from change''. And your petitioners as in duty bound will ever pray. by Mr Slipper. To the Honourable the Speaker and members of the House of Representatives in Parliament assembled. The petition of certain citizens of the Federal Division of Fisher in Queensland respectfully showeth: That the actions of trade unions have gone beyond their traditional goals of protecting workers conditions and rates of pay and have reached the point where they are seriously affecting the economic health of the nation and the people. Your Petitioners therefore humbly pray: 1. That all Governments throughout Australia acknowledge and protect the Right to Work on behalf of all Australians. 2. That the total sovereignty of individual governments be recognised as a fundamental requirement of a workable, balanced Federal system of government. 3. That all necessary steps be taken to protect the citizens of Australia from any inducement, compulsion, threat or intimidation to join any trade union. 4. That there should be no preference in employment for people who are members of trade unions. 5. That the supremacy of elected governments over the sectional interests of trade unions be recognised, and 6. That the provision of essential services be maintained, free from industrial disruption. And your petitioners as in duty bound will ever pray. by Mr Slipper. To the Honourable the Speaker and members of the House of Representatives in Parliament assembled: The humble petition of certain citizens of Queensland, Australia, respectfully showeth that we are totally opposed to any change in the Australian National Flag declared in the Flags Act (1953). Your petitioners humbly pray that Parliament in its wisdom will take no action to change the Australian National Flag. And your petitioners, as in duty bound, will ever pray. by Dr Watson. Petitions received. 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 escalation of costs to home owners, small business and rural industries arising from the Government's high interest rate policy. 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)(2.57) —Once again the Opposition is obliged to raise a matter which irks the world's greatest Treasurer no end: The continuing escalation of costs to home owners, small business and rural industries arising from the Government's high interest rate policy. Since I last raised this matter in the House last month, the prime lending rate of the major trading banks has gone up another half per cent to 18 1/2 per cent. This compares with 14 per cent when the Hawke Government came to office. The small overdraft rate is 16 1/4 per cent only on the first $100,000 borrowed by a small businessman or farmer, who has to go elsewhere at much higher rates for any excess borrowings over $100,000. One can imagine the effect this is having on small business and farm costs, and of course it affects the willingness of small businessmen to expand their activities through investment and by taking on more staff. For the farmer, of course, it threatens the very survival of the person on the land. The Treasurer (Mr Keating) has tried to paint a picture of investors jumping over themselves to borrow the expensive money to make new investments. Dr Klugman —On a point of order, Madam Deputy Speaker: I am not 100 per cent sure about Standing Orders, but I draw your attention to my notice of motion No. 87 on page 3102 of the Notice Paper. This is basically the same as the matter of public importance that has been introduced by the honourable member for Mackellar. My notice of motion reads: That this House supports higher interest rates for depositors in financial institutions and lower interest rates for borrowers. Madam DEPUTY SPEAKER(Mrs Child) —Order! There is no point of order. The honourable member's notice of motion could well be brought on for debate in the House. Mr CARLTON —That gives some idea of how pathetic and how concerned the Government is about having this matter raised. Government members are trying to stop the matter of public importance being debated by raising frivolous points of order. Anyone who is concerned about what is happening to farms, small businesses and home owners will understand that Government back benchers, supported by the Treasurer, just want this matter hushed up and not debated in the House. Where is the evidence of the assertion by the Treasurer that investors are falling over themselves to borrow expensive money to make new investments? After the announcement of the new capital gains tax investors will be even less willing to use this high cost money to invest since their effective rate of return will be reduced by capital gains tax. What of home owners? After giving us a stern lecture on the way in which market forces must determine interest rates, the Treasurer had to sit in the House while the Prime Minister (Mr Hawke) announced that the artificial ceiling on savings bank loans would be fixed at 13 1/2 per cent. He knows that that decision makes a mockery of his whole argument for flexibility of financial markets. He knows that even the Government-owned Commonwealth Bank is circumventing the ceiling and charging more for savings bank home loans by making additional service charges. He knows that generally the banks have to circumvent the 13 1/2 per cent artificial ceiling by diverting borrowers into more expensive loans often through finance companies at very high rates indeed. The Treasurer cannot accuse the Opposition of inconsistency on interest rates. We acknowledge the absurdity of the ceiling, as he acknowledged it some months ago when he took it off overdrafts for small businesses. He acknowledges the absurdity but maintains the fiction. Even at the 13 1/2 per cent level from which hardly anyone benefits, and certainly not those borrowers from the Commonwealth Bank who are paying additional service charges, a family with a $40,000 loan over 25 years-this is a fairly modest loan-would be paying an additional $10 a week more than they were paying a few months ago in interest charges under this Government's high interest rates policies. New home owners will be the hardest hit because they have to face up to the widening deposit gap. Funds at the 13 1/2 per cent rate are drying up fast because the savings banks cannot attract new deposits at the low rates that they have to pay. If these people look at the higher interest costs available from other sources, they find that they do not have the repayment capacity to buy the home they seek. The new home owners will be hit even harder than current borrowers. Private home building figures are starting to show this trend. In July the number of private home starts began to fall. I have been reliably informed, through talking with people in the banks, that loans have become harder since then and that there has been a greater fall off in private buildings. What is happening with interest rates overseas? Let us have a look at what the competition is offered. After all, we have to compete in our businesses with trading partners and competitors overseas. They are being charged interest rates that are very much lower than the Australian primary rate of 18 1/2 per cent. The prime rate in the United Kingdom this month was 12 1/2 per cent; in France, 10.9 per cent; in Canada, 10.1 per cent; in the United States of America, 9.5 per cent; in West Germany, Holland and Switzerland, 7 1/2 per cent and in Japan, 5 1/2 per cent-Australia's prime rate is 18 1/2 per cent. Before the Treasurer works himself up to deliver us a Treasury lecture on monetary policy, let me make it clear that our argument with the Government is not the link between interest rates and monetary policy; our argument is not over the interest rate ceiling. We are fully aware of the link between interest rates and monetary policy. We are fully aware of the absurdity of the Treasurer's position on the housing interest rate ceiling. Our argument is with people who make promises and do not deliver. Our argument is with those who claim that they have the world's best economic policy yet refuse to acknowledge glaring defects in that policy. Let us first have a look at the promises. The Treasurer never likes me to go back to these promises, particularly those made before the last election. I go back once again to Guy Fawkes day, 5 November 1984, during the lead-up to the election campaign. I refer honourable members to that famous front page of the Daily Mirror. It was not only the popular Press-- Mr Howard —It has a big circulation. Mr CARLTON —The Daily Mirror has a big circulation. There was an article also in the Age. The heading in the Daily Mirror stated: `Home loan drop on the way'. A picture on the front page carries the heading `Home Boost: Treasurer Keating'. The article states: Home buyers are set to receive a New Year bonus, with mortgage rates strongly tipped to fall. Treasurer Paul Keating has predicted an across-the-board fall in interest rates flowing on to home repayments. Mr Keating said: `I accept the views of most market commentators that we have further interest rate falls ahead of us . . .' That statement was made by the Treasurer on 5 November 1984, before the election. This comment was followed up closer to the election date by a comment from the Prime Minister. I have a cutting of a page from the Melbourne Sun-News Pictorial of Wednesday, 21 November. I like this page because at the top is a picture of Gough Whitlam and an article headed: `Memories of Gough'. The story I draw attention to is headed: `Interest will drop-PM'. Only a week or two before the election the Prime Minister said in Adelaide that interest rates will drop in the following year. The article stated: He said yesterday Australians would `reap the interest rate rewards' that were flowing from the Government's policies over the past 20 months. `We've ploughed the fields and sown the seeds', he told a business lunch in Adelaide. `In the very near future, we will harvest the crops'. So the Treasurer followed by the Prime Minister promised interest rate reductions during the election campaign. After the election, the then Deputy Leader of the Opposition, Mr Howard, in a question in the House asked: I wonder whether the Treasurer could give the House some idea of when the interest rate reductions that he and the Prime Minister promised during the election campaign are likely to occur. That was on 25 February 1985, after the election. Mr Keating replied: I am quite prepared to stand precisely by what I said in the election campaign. I said on that occasion that I accepted the view of most market commentators that there was a further interest rate step fall ahead of us, particularly after we get through the tax rundown period. I stand by that. As the Deputy Leader of the Opposition well knows, the upward adjustment of interest rates that has occurred in recent times has been part and parcel of the general liquidity conditions in the rundown of the second half of the year. We have been through all that and interest rates have continued to rise. So, on 12 April the Prime Minister had two bob each way. The Australian Financial Review had a story headed: `Hawke blames irrational market for interest rates'. The article stated: Once the money market became more rational, took a good look at the Government's economic policy actions and the tax rundown period was over, there would be a lowering of interest rates, the Prime Minister, Mr Hawke, predicted yesterday. . . . `We nevertheless believe that given the fundamental strengths of the Australian economy- this is 12 April this year- and, I think, the increasing perception of the strength of the adherence of the Government to the fiscal management which is embodied in the trilogy, that we can expect through the period of this year there will be, I would expect, a lowering in the level of interest rates'. That is what we hold the Government to. Before the election it promised a drop in interest rates. After the election it continued to say that there would be a drop in interest rates. As recently as April the Prime Minister, while blaming irrational markets for an increase in interest rates, said that there would still be a drop. That is what we were promised. We compare that with a rise to 18 1/2 per cent in the prime rate and an increase of 2 per cent for home borrowings since then, with increases of $10 a week for modest home owners. What about the economic policy that we are talking about? Just how good is it when interest rates are at their highest real levels since the Great Depression? How good is it when home owners, small businesses and farmers are really hurting from the cost effects of high interest rates? How good is it when our inflation rate is higher than those of our trading partners and when our international competitiveness is threatened? How good is it when the dollar is still shaky months after the devaluation which was supposed to put us back into the ring? Today we got the September balance of payments figures. Once again, despite the fact that we have the world's greatest Treasurer and the world's greatest economic policy, the figures are very bad. There has been a further deterioriation in the balance of payments at a time when we ought to be seeing some benefit accruing from the devaluation earlier this year. Both the balance of trade and current account positions moved further into deficit in September. For the first three months of this financial year the current account deficit was $3,345m, well up on the deficit for the same period last year. So it looks as though we are headed for a current account deficit this financial year which will surpass last year's historically high level. What is of particular concern is that the benefits of the competitive advantage which should have been expected to flow from the massive devaluation of the dollar earlier this year have not yet materialised. In fact, our trading performance has continued to deteriorate, with a marginal decline in imports being more than offset by an 11 per cent decline in the value of our exports while at the same time our inflation performance has worsened against that of our major trading partners. Our balance of payments performance so far, combined with our massive overseas debt, will be further bad news for interest rates because, in order to avoid further downward pressure on our exchange rate, the Government has been forced to keep interest rates at exorbitant levels. If the dollar falls much further-it has been very shaky against the trade weighted index-the Government will have to go cap in hand once again to the Australian Council of Trade Unions to seek further wage discounting or risk a further intensification of inflationary pressures. But high interest rates themselves feed back into the economy causing economic damage as their costs go through into wages through automatic wage indexation. This Government has to face up to two things. The first is the fact that it promised in the election campaign, and again this year, that interest rates would fall. This Government is very good at telling us how good its economic management is. It is very good at telling us what the benefits are. It told us what the benefits were going to be before the election and those benefits have not materialised. But what is worse than that, the overseas position is still deteriorating, despite the effects we should have got from devaluation, and the interest rate regime would seem to have to continue for months ahead. My question to the Treasurer is this: In view of the promises that he and the Prime Minister made to the Australian people, just when will we see interest rates coming down? This basic ingredient of a healthy economy, that is, a reasonable rate of interest, must come along soon, otherwise the whole of the accord will come tumbling round the Treasurer's ears. I repeat my question to the Treasurer: Just when will the high interest rate regime be stopped? Just when will interest rates fall in the way that he and the Prime Minister so clearly indicated to the Australian people before and after the election? Mr KEATING(Blaxland-Treasurer)(3.12) —I was nearly chloroformed by the performance of the honourable member for Mackellar (Mr Carlton). It nearly put me right out for the afternoon. This is about the fourth time that we have heard this drivel from the honourable member for Mackellar. What surprises me about it is that it is precisely the same drivel as we had the previous time. There is not even any permutation or variation in the theme; it is just the same old garbage that we heard the time before. What it really gets down to is that the Opposition is saying that it understands the links between monetary policy and interest rates but it is seeking to deny them. The Opposition understands the links, despite the fact that it seeks to deny them, but it is really on about what it alleges. The Opposition, in trying to beat up the remarks that the Prime Minister (Mr Hawke) and I made in the election campaign, is really making a point as to when interest rates should be coming down. That is the whole point of the plot. Really, it is much deeper than that. We have the free marketeers, the people who are now running the Liberal Party of Australia, the so-called dries, the people who believe in market outcomes, standing up in the Parliament every week and denying that the market has the right outcome. They are saying that the market outcomes are wrong and that they will not accept them. They are saying that the market has it all wrong, only they are right, and what is wrong is the casting of policy. Therefore, in their remarks directed towards the Government, they enjoin the Government to loosen monetary policy. They have done that explicitly and implicitly-explicitly by the Leader of the Opposition (Mr Howard), in his Press statements, saying in the first place that monetary policy was too loose and ought to be tightened and now saying that it is too tight and ought to be loosened. While saying that this is bad for the economy, they fail to recognise or even to mention that last week we saw figures showing employment growth running at 56,000 for the last month. The present interest rates are supposed to be holding down economic growth, yet we saw economic growth manifested in this very strong growth in employment. In fact, 210,000 jobs have been created since the beginning of this financial year. We are also seeing economic growth in terms of the housing industry. We saw crocodile tears being shed about housing interest rates, but the total number of new dwelling approvals rose by 2 per cent in August and 1.2 per cent in the three months to August. Let me cite the number of building approvals over the last three years. There were 116,400 in the last year of the coalition Government-that was its pathetic performance-and there were 150,000 in the first year of the Hawke Government. The number of dwelling approvals rose from 116,400 to 150,000. In 1984-85, the number of approvals rose to 160,400. Many more thousands of Australian families are in homes as a result of this Government's policy to deregulate the financial sector and let money flow back into the banking system for housing. Despite all this talk about interest rates in respect of housing, we have been able to maintain that growth in housing approvals. But the most important point is the fact that people today are not borrowing, as they were in Mr Howard's time as Treasurer, to hang on, to save themselves from financial insolvency. They are borrowing now to invest and to expand their businesses. Today profits are good, bank lending is high and business borrowing is set to expand. Despite the interest rates which have prevailed in more recent times, bank lending has been running very strongly and growth in the economy has been running very strongly. So what is the basis of the claim by the shadow Treasurer? There is no basis to it. Really what the Opposition is cavilling at is monetary policy. We have seen a 26 per cent increase in the balance sheets of trading banks over the last 12 months. Because of deregulation the banking system has again had an enormous growth in deposits and lending and that lending, of course, has the capacity to lift growth in the economy. But if it were to get to a point where pressure emerges on both prices and wages, that would be counter-productive. Hence the Government has a firm monetary policy in place. The coalition today is saying that it does not want a firm monetary policy in place, that it does not believe in controlling inflation like this. It really wants the Government to soften monetary policy so that interest rates can subside. While it is true that the Government has the prices and incomes accord to rely upon as one of the central tenets of its policy in respect of inflation control, it also has monetary policy. Right from its first days in office it has run a firm monetary policy, so much so that in 1983-84, I think we sold $12 billion worth of bonds to mop up the massive Budget deficit bequeathed to us by the former Treasurer and also the capital inflow which came that year before the Government floated the exchange rate. We brought the money supply in on target for the first time in six years in 1983-84 with that massive bond selling program. We have continued to run a firm monetary policy ever since because we do not believe that the accord alone should be sufficient to rely upon for inflation control but that it ought to be backed up and supported by a decent monetary policy. I would have thought that that would have been one of the things that the honourable member for Mackellar would have identified with. I would have thought that the members of the new dry Liberal Party, the free marketeers, would have been giving a signal to the markets out there that they actually believe in a decent monetary policy, that they actually believe in having a rigorous approach to inflation control and that in a very strongly growing economy-if the June quarter accounts are an indication, running at somewhere on a flash basis between 8 and 12 per cent, depending on which measure is used-and with the employment growth manifesting the strength of the recovery, decent monetary policy and the attendant interest rates are things which would comfort a sensible Opposition in respect of inflation. But no, these dullards on the other side of the House apparently think that more points are to be gained from cheap shots about interest rates and parading on the front page of the Sydney Daily Mirror with some totally irrelevant story about interest rates before the depreciation of the Australian dollar. I am at a bit of a loss to understand just where the Opposition stands on any policy whatsoever. It is totally rudderless on all policy. It has a sham wages policy which has fallen to pieces; nobody knows where it stands on wages. It has a sham tax policy. Senator Messner denies Mr Howard all the central tenets of the policy on which he was elected in his famous policy speech to the National Press Club, before he downed Andrew Peacock in the party room and, of course, a sham economic policy in general. There is no sensible cast of policy. Nobody in the financial markets can have any confidence in the Opposition. It has no idea how to run the economy and no idea how to reduce inflation. We heard this silly rhetoric about: `How good is growth when you have inflation running at 6 to 6.5 per cent?' How good was it when it was running at 12 per cent? That is what the Opposition left us with. How good was it when we had unemployment rising by a quarter of a million in one year, and how good is it now when we have 487,000 people in jobs? How good is it when we have 5 per cent non-farm growth? The Opposition has tried to deny the undeniable. I wonder why it has taken the trouble to waste my time and its own with these sorts of proposals. I noticed some confused gibberish about the balance of payments. Let me say something about that. The outcome for the September quarter balance of payments is precisely spot on with the Treasurer's forecast for the current account over the balance of this year. The current account deficit has been reduced from 4.9 per cent to 4.6 per cent of gross domestic product over the course of the year, on year average terms. We believe also, as we forecast, that there will be an improvement on a through the year basis. So the current account deficit will decline with speed towards the end of the year. At the end of the first quarter the outcome for September was precisely as the Treasury forecast. So it is not a matter of a trend running against what was expected; it is as we expected it would be. The J-curve effect takes time-it gets worse before it gets better. We also figured into that calculation the strength of our domestic recovery and the impact of that strength on import growth, notwithstanding the 20 per cent depreciation. The fact is that the current account deficit is running as we forecast it would. On that score also the Jeremiah stuff we have heard from the other side of the House has no basis to it. We are at the stage in economic policy discussion in this Parliament where one side of the House has a coherent economic policy-effective anti-inflation, growth and monetary policies-which has manifested itself in growth in living standards and employment. On the Opposition side there is no such economic policy. It still believes in an inflation-first strategy of throttling growth to throttle inflation, by using monetary policy to kill off growth and inflation. Yet those opposite come in here with crocodile tears and talk about how high inflation might slow growth. They never believed in growth, nor were they interested in growth. They had an average of 2 per cent growth in each year of their seven years in office. We had more growth in our first two years in office than they had in seven years, yet they come in here and tell us that our interest rate policy will be detrimental to growth. We believe in running a firm, sensible monetary policy, particularly in the face of strong economic growth. We want to maximise employment opportunities in the economy and in the maximisation of those opportunities we want to maximise growth. We want the strongest rates of growth that this country can both sustain and tolerate. We are not about to abandon monetary policy for some short term effect on interest rates in order to placate the opportunist noises coming from the Opposition. I suggest to the honourable member for Mackellar that the next time he goes back to Sydney, where he comes from, he should ask people in the financial market what they think of his views on monetary policy and interest rates. I suspect that he will be told sharply that he is wrong; that the Opposition has no idea how to manage an anti-inflationary policy in the face of strong economic growth, or indeed in the face of any growth at all. Remember that we had double digit inflation in the late 1970s with only 2 per cent growth. I am afraid that for the coalition it is back to the drawing board. The people in the business community, who know on which side their bread is buttered, are now seeing profit, investment and employment growth. Business opportunities are being opened up by this Government's policies, notwithstanding the interest rate consequences of the depreciation. That growth will lead the business community again to signal its faith in the Government's policies and reject as humbug the policies of the coalition. Mr HUNT(Gwydir)(3.25) —I agree with the Treasurer (Mr Keating) on one point, and that is that this nation requires growth. But it does not require growth in interest rates, and that is what this debate is about at present. The Government's wage indexation and, indeed, its economic growth is being funded by overseas and domestic borrowings and by record interest rates. The Treasurer asked a question: What is and where is the basis of the Opposition's concern? I suggest to him that he should go out amongst the farming community and the small business sector of Australia. He challenged the honourable member for Mackellar (Mr Carlton) to go out amongst the business world and challenge business people with respect to the facts of growth and the policies that this Government is following. I challenge the Treasurer to go out into the country areas and to test the feeling there as a result of the record high interest rates. The truth of the matter is not, as the Treasurer says, that the accord is backed up by a decent monetary policy. I quote the words he used: `The accord is backed up by decent monetary policy'. What he meant and should have said is that the accord is backed up by record high interest rates. The Treasurer and his Government have manipulated monetary policy to keep interest rates high in order to attract foreign investment and thus cushion the plunge of the dollar on foreign exchange markets. Australians are paying a very high price for the debacles such as the MX missile reversal, excessive Budget deficits, and the so called accord, all of which have contributed to the falling confidence in the Hawke Labor Government by business both here and abroad. There is no doubt that the Hawke Labor Government has manipulated the system to stop the dollar plummeting below the US60c barrier. By driving up interest rates, it has stopped the dollar going through the floor. The Reserve Bank of Australia annual report of 30 June this year admitted as much. It stated: The effects of tighter monetary policy since February may take time to become apparent in the growth of financial aggregates. It goes on: The impact on interest rates, however, is evident; by the end of the year, most interest rates had risen substantially with many rates at historically high levels both absolutely and relative to the rate of inflation. Labor's decision to push interest rates up to a record high in real terms is falling heaviest on those who can least afford to pay. Who are the ones being most crippled by these debt loads? It is the farmers, the small business sector and home buyers. Labor has abandoned the farm sector. It has been singled out in each of Labor's Budgets for excessive expenditure cuts and with the recent tax package and now record debt loads it faces record real interest rates. None will suffer more than the people living in country areas, whether they be the families operating farms or small businesses, or whether they be people who seek to obtain jobs in areas where we have up to 30 per cent unemployment; people who have fought a prolonged drought coupled with a collapse in some commodity prices but who are battling to stay in their businesses and on their farms. Although the breaking of the record drought gave some relief, the costs of drought, low prices and high costs have left farmers with record debt loads. The crippling interest rates could not have come at a worse time. The Bureau of Agricultural Economics surveyed three-quarters of Australia's 170,000 farms, revealing an average farm business debt at 30 June 1984 of $53,700. These are the latest figures we have. If they had been taken at 30 June 1985, they would have been considerably higher. But over 12 months ago the debt was $53,700 per farm. Some specific industries face an enormous debt load. In Western Australia, for instance, the wheat belt was found to have an average farm business debt of $148,000-and that was at 30 June last year. But it is said that it is more likely to be about $180,000 to $190,000 today. In most cases these debt loads have resulted from factors outside the control of farmers. No doubt the lending institutions have increased loans because of the cyclical nature of agriculture and the hope of improved prospects of the mid-1980s. Indeed, I have been pleased that the banks have given undertakings to the National Farmers Federation that they will not engage in foreclosures and that farmers generally should not be in fear of actions they might take. I am very pleased that the National Farmers Federation took the initiative to talk with all the leading bankers in this country. I know that this week my own Leader will be doing the same, because there could well be a crisis if banks started to foreclose on some of the oppressed farmers at present. The dollar fiasco has been largely responsible for madly escalating interest rates. The Hawke Government must accept its full share of the blame for the economic nightmare now facing tens of thousands of farmers and small business people. Let us look at the trend in interest rates this year. Interest rates have leapt, month by month, in a staggering fashion. The maximum rate for trading bank overdrafts of $100,000 or more stood at 14.25 per cent in January. In February it was 14.75 per cent; in March, 16 per cent; in April, 16.75 per cent; and in May, 17 per cent. In many cases today it is in excess of 20 per cent. Mr Nehl —Disgraceful! Mr HUNT —It is disgraceful. No business can operate for any length of time with that sort of interest rate. Other financial institutions' rates are higher still. Institutional farm debt has broken through the $6 billion mark. We cannot expect the farm industries to bear the twin burdens of escalating debt and crippling, record high interest rates without damaging our ability to earn the export income so crucial to the repayment of the $70 billion gross external debt, which has doubled since 1983. The recent decline of Australia's credit rating is the tip of the iceberg. Australia faces a devastating economic downturn unless we restore to the wealth-generating export industries a capacity to make a fair return and the incentive to stay in business, despite the present very trying economic and trading conditions. The Hawke Labor Government is adopting expedient economic policies based on its requirements to satisfy its commitment to the Australian Council of Trade Unions through the prices and incomes accord. In the end, all Australians will pay a high price for this commitment. I acknowledge that interest rates peaked at high levels under the coalition Government in 1982. However, there is a fundamental difference. At that time world interest rates had soared. This time we are out on our own. We are way out in front of them all. The honourable member for Mackellar cited some very interesting figures which show that our interest rates are far ahead of those of other countries. Our interest rates hover around 20 per cent whereas in Holland and Switzerland they are 7.5 per cent, and in Japan they are 5.5 per cent. Already our export performance is deteriorating at an accelerating rate. Our export competitiveness will become something of an international joke unless urgent steps are taken to restore our ability to compete by lowering our production costs. Country Australia is getting it in the neck from this Government. Not content with the enormous debt and interest rate burdens on small business, the farm and farm industries, the Government has pursued a discriminatory policy of ripping off the rural sector-$442m of Budget outlays since 1983-and introducing new tax measures which effectively transfer resources from the people living outside the major metropolitan centres. All this is to satisfy the Government's ACTU masters. There is a case for positive discrimination in favour of country-based industries if Australia is to regain its international standing. Sadly, our future generations stand to pay heavily for the shortsighted and expedient policies of the Hawke Labor Government in regard to its monetary and fiscal responsibilities. No government can continually discriminate against the wealth producing and export sectors of its economy without reducing all living standards. The lesson of the Argentine is there for all to see. Our relative living standards are falling. We are a diminishing trading nation. Record interest rates will only accelerate our decline as a prosperous people. It is not good enough for the Treasurer to come into this place and say: `Where is the basis of your concern?' The basis of our concern is with the wealth producing industries of this nation. Unless the Government is prepared to face up to their dilemma and crisis, we will see those factors contributing to the declining living standards of Australians generally. Mr CUNNINGHAM(McMillan)(3.35) —The matter of public importance we are debating today is another example of the Opposition's two-faced opportunism in attempting to exploit interest rates as a political issue. We have just heard from the honourable member for Gwydir (Mr Hunt) who, along with the right honourable member for New England (Mr Sinclair), represents the agrarian socialists, those who believe in socialising the losses and privatising the profits. We have also heard today from the new Liberal dries, the honourable member for Mackellar (Mr Carlton) and his new Leader, the honourable member for Bennelong (Mr Howard), who have espoused free market policies which they are quickly abandoning day by day. Of course, we know of the other Opposition faction-the Liberal wets, who are led by the honourable member for Kooyong (Mr Peacock) and the honourable member for Denison (Mr Hodgman), who could not agree one way or the other or make up their minds about anything. We have just heard the honourable member for Gwydir suggesting that interest rates are causing massive problems for the rural sector. There is no doubt that interest rates are something that everybody hates to see increase. However, there are good reasons in today's economy as to why. The Treasurer (Mr Keating) explained them very carefully. I cannot let go some of the things mentioned by the honourable member for Gwydir without correcting them. I refer to the massive effect that the honourable member claims interest rates are having on the rural sector. It is incorrect to suggest that the majority of farmers are experiencing debt problems. It is just not true. According to the latest information from the Bureau of Agricultural Economics-the honourable member cited its figures previously for his own benefit-the average debt-capital ratio of Australian farmers is quite low, less than 10 per cent. In June 1984-the latest figures available-22 per cent of farms had no debts whatsoever. A further 28 per cent had debts of less than $15,000. So 50 per cent of the farming community could be investors rather than debtors. Therefore, they have an objective interest in interest rates. That 50 per cent of the farming community would have an interest in seeing that it gets a return on whatever investment it has over and above inflation. So which half of the rural sector is the National Party of Australia talking about? On the other hand, the average farm also had nearly $21,000 of liquid business assets and over $10,000 of financial investments in the hands of the farm household, as distinct from the farm business. The 1984 average farm debt of around $31,000 was almost exactly matched by liquid assets of a similar amount. Hence, on average, farmers gain as much as they lose from interest rate increases. Of course, this average hides relatively small pockets of farmers who are experiencing problems. This Government is certainly very alarmed about the problems that certain industries are facing. However, these problems tend to be related to the commodities concerned. The major problems at present are in the areas of horticulture, rice, sugar and Western Australian wheat farming, which the honourable member for Gwydir mentioned. It is obvious from this list that the major difficulty is with low returns as much as with high interest rates. Perhaps low returns are having a bigger effect than high interest rates and the real problem is in low returns. It is true that rural indebtedness has increased, possibly by around 10 per cent in 1984-85, which would bring the total debt of the rural sector to around $6,500m. A significant proportion of this increase would reflect the result in producers borrowing to finance expansion. Farmers had debt problems under the reign of the present Leader of the Opposition as Treasurer and were borrowing just to hang on. Today, right throughout the economy, people are borrowing money, even at high interest rates, to invest and expand. That is the difference with the economy at present. Let us look at some of the strong points of the economy. Economic growth fell by 0.6 per cent in 1982-83 but increased by 4.9 per cent in 1983-84 and by 4.6 per cent in 1984-85. Non-farm gross domestic product grew by 5 per cent in 1984-85. Economic growth averaged only 2.1 per cent a year under the Liberals. It is averaging close to 5 per cent under Labor. Hence, it is quite obvious that there are pressures to borrow money, not, as used to be the case, for farming and business communities to hang on. Today they are borrowing money to invest, to develop their economies, to expand. Why should they want to do so? In regard to consumption, retail sales continue to rise strongly, increasing by 4.3 per cent in the July quarter of 1985 to being 11.2 per cent higher than they were in the July quarter of 1984. From the April 1983 though, employment is up 481,200-well on target to meeting this Government's promise of creating 500,000 jobs within three years. The unemployment rate is down from 10.4 per cent in September 1983 to 8.1 per cent in September 1985. These figures clearly indicate that we have two elements working in the economy at present. One is the monetary policy which the Government is sticking to and which has been applauded throughout the economy. This is no doubt affecting interest rates, but in the long term I am sure that the Australian people will understand that this is the policy they elected this Government to carry out. We need only to look at the editorial in the Australian of 10 March 1983 to see what was being said at the time of the election and what the people of Australia want. I will read part of it in this debate: The former prime minister, Mr Fraser, and his colleagues were elected to government with an overwhelming majority on December 13, 1975, on their own argument that they were demonstrably better economic and financial managers than the previous . . . government. In their seven years and 82 days in office they failed, dismally, in living up to those claims . . . As prime minister, Mr Fraser must take much of the blame for the failure of his government's economic policies. But he cannot be expected to shoulder all the responsibility for the government's inability-or unwillingness-to pursue its economic and financial objectives. Much of it must also be laid at the door of his treasurer for five years, Mr John Howard, who was responsible for framing, with Treasury advice, the last five Budgets of the Fraser government. It will take a long time for him to live down his ministerial legacy of huge Budget deficits this year and next. What is required now is a prime minister and treasurer who know exactly what the deficit is and know what to do about it. It is up to Mr Hawke and Mr Keating, from their formal assumption of office tomorrow, to take on the tough job of repairing the damage to the Government's finances and the economy, and set the country on the road to recovery. That is what this debate today is about. Members of the Opposition come in here bleating about interest rates without any policy of their own. As I mentioned at the start, they have three factions-the agrarian socialists, the Liberal dries and the Liberal wets. None of them knew which direction they wanted to go in those days when they should have learned the lessons that the Australian newspaper talked about so effectively. In their speeches on the matter of public importance today honourable members opposite also said that interest rates were having a detrimental effect on the housing sector. Let us look at some of the figures. Between the trough in the March quarter 1983 to the June quarter 1985, real private dwelling investment rose by 40.4 per cent. That is a massive increase in investment. It has happened at a time when the Opposition is trying to tell us that there is doom and gloom about, that people are not prepared to invest, that people are not confident of the economy in Australia and that interest rates are too high. When this country gets fully mobile, when we get interest rates and the economy back into kilter with a lower inflation rate, we will see some real figures, but these are quite impressive as they are. In 1984-85 housing commencements numbered 152,000, the highest level since 1973-74. The lowest levels of commencement we saw for a long time were at the end of the reign of the Fraser Government. In the three months to August 1985 the number of approvals rose by 1.2 per cent. Let us go to one of the areas that the honourable member for Mackellar and his Leader, the honourable member for Bennelong, used to claim they represented-the private business area. Real private business fixed investment recovered in 1984-85 by 4 per cent. The Statistician showed that, in current prices, investment expectations are 11 per cent higher for 1985 and 1986. In real terms we expect growth to be a little higher than last year. Is this a sign of a problem in the economy or that there is such drastic doom and gloom about, as mentioned by the honourable member for Mackellar and the honourable member for Gwydir? It certainly is not, and I am sure that this Treasurer and the Prime Minister (Mr Hawke), as stated in the Australian editorial I quoted previously, knew exactly what the deficit was and what to do about that sort of thing. We have had a clear indication from the time that that was printed in 1983 through to today that the Government is on the correct course. The figures indicate that the Government is on the correct course and there is certainly no doubt as to what the Government is on about. I conclude by going back to a report by the Reserve Bank of 30 June 1981. I quote one small section from its comments on policy-this was at a time when the honourable member for Bennelong was in charge: Growth in money and credit in 1980-81 was too rapid, even taking into account that growth and output were stronger than expected. The outcome cannot be viewed independently of events in preceding years. Experience in the last three years has demonstrated weaknesses in the way policy has been implemented. The Reserve Bank was quite adamant at that stage that the honourable member for Gwydir and the Liberal dries as we call them-- Madam DEPUTY SPEAKER(Mrs Child) —Order! The honourable member's time has expired. The debate is concluded. Debate resumed from 11 September, on motion by Mr Hurford: That the Bill be now read a second time. Mr CARLTON(Mackellar)(3.45) —The Loans Bill 1985 is a machinery Bill to make provision for financing of the Budget deficit in 1985-86 and subsequent years. Unfortunately, in some respects a government cannot overspend from Consolidated Revenue; so where the Parliament authorises expenditures that would cause the equivalent of an overdraft on the Consolidated Revenue Fund, the Government must borrow to meet the excess expenditure. It is just the same as in a household. If one has not enough money in one's bank account and outlays are higher than what is there, one has to borrow some money. This Bill makes arrangements for the Government to borrow. Previously there used to be an annual Loan Bill to handle this situation for all circumstances arising during a financial year. This Bill has been drafted as standing legislation rather than annual legislation to remove the necessity to pass legislation annually. As the Bill does not itself authorise expenditure but merely creates a mechanism whereby expenditures authorised by other legislation can be made, the Opposition does not object to the concept of standing legislation. It merely improves the efficiency of the Parliament. We therefore support the Bill. What we are concerned about, however, is the level of borrowing required under the present Government's policies and the borrowing that this Bill enables. The Treasurer (Mr Keating) continues to shower himself with congratulations and self-praise. If one were to listen to all that without looking at the underlying figures, one might be somewhat taken in, but there is a very substantial increase in government spending under the Hawke Government leading to additional debt. The average real increase in government spending under the Hawke Government is still 4.9 per cent per year, which is more than double that of the average of the Fraser years. Something that is forgotten in the heat of debate is that the Fraser Government had a lower percentage increase in real terms over its seven years on average than any government before or since. That is something well worth saying because a lot of nonsense is talked about that. Mr Andrew —Well worth repeating. Mr CARLTON —That is true. Incidentally, if I may say so in the same vein, it also had a lower rate of unemployment in six of its seven years than the Hawke Government has had since. What ought to be taken into account in looking at those figures is that that final year was a year of very grave international recession and drought within Australia. There were very exceptional conditions. When the Government congratulates itself on its present level of unemployment-about 8 per cent-it is really a shocking performance when one considers the alleged growth that has occurred over the years that have gone since. As a result of this extra spending, 750,000 pay as you earn taxpayers will move into higher tax brackets this year and 500,000 of them will go into the 46c rate. In the recent package they were promised some relief from this, starting in September of next year and then again in July of 1987. We will see whether there is any money available to pay for those promises. Under the present Treasurer per capita overseas debt has risen from $1,571 in June 1983 to $3,326 in June 1985. In other words, to look at it in a personal way, in June 1983 every individual-man, woman and child-had borrowed $1,571 overseas and in June 1985 that had risen to $3,326 per person. That is a rather frightening thought. If one sees a baby in a pram these days, one knows that attached to that baby's head is an overseas debt of no less than $3,326 before the child has even been to school. That is very serious. The overseas debt under this Government has risen over that same period of two years from 14.6 per cent to 25.1 per cent of our gross domestic product. More than a quarter of everything we produce in a year goes to service our overseas debt, and that is a pretty frightening figure. The public sector component of that debt has risen from $864 a head in June 1983 to $1,670 a head in 1985; it has doubled. Despite the fact that the economy is supposed to have grown and despite the fact that we are supposed to have the best economic managers in the world our public sector overseas debt, which was $864 a head two years ago, is now $1,670 a head. Mr Hodgman —Fifty per cent more than in the United States. Mr CARLTON —Yes, as the honourable member for Denison so correctly says, it is 50 per cent more than in the United States. It is said that the United States has a very high level of debt at the moment, and historically it has, but ours is double that level. Of course, when one has debt like this one has to pay interest on it. One also has to repay capital according to the obligations in the original arrangements. Australia's external debt servicing obligations, expressed as the ratio of interest payments and contractually due capital repayments to exports of goods and services, rose from 8.3 per cent of GDP in 1979-80 to 33.6 per cent in 1984-85. Let me explain that to honourable members. In order to get some idea of how much of one's overseas earnings one must pay out in order to service one's borrowings, one has what is called a debt servicing ratio. If one takes interest and capital together, then over the financial year just ended 33.6 per cent of our exports of goods and services had to be spent on repayment of capital under contract and interest. In other words, about one-third of everything we earned overseas in a year had to be paid out in interest payments and repayment of capital. If one is running a household and one is paying out one-third of after-tax income in servicing debts, one must be a little worried about how far one is going. Consequently, we as a nation must be very concerned about that. There is another indicator called the public sector borrowing requirement. If one takes the total requirement of public bodies-Federal, State and local-to borrow money in order to meet spending that is not covered by current income, one sees that it is still 5.6 per cent of our gross domestic product, or almost 50 per cent greater than that of the United States. It is also much higher than that of most other industrialised countries. Australia's 5.6 per cent in 1986 compares with 3.8 per cent for the United States, 0.5 per cent for Japan, 1.3 per cent for West Germany, and 2.9 per cent for the United Kingdom. The only country that gets close to us is the rather profligate Canada, which has had pretty bad economic policies over a number of years. Its requirement is 5.5 per cent, but we are still higher than that at 5.6 per cent. The deficit of about $5 billion in this year's Budget-it was put at $4.9 billion, but because of the deal done with the Australian Council of Trade Unions on wage discounting, some discounting of inflationary pressures due to devaluation was agreed to-means that the cumulative deficit in the first three Keating Budgets is $20 billion. This is more than the cumulative deficits for the seven Fraser Budgets. So in just three years this Government has chalked up deficits which are higher than those of all seven Fraser Budgets put together. It must be remembered that even if the Hawke Government achieves the $5 billion deficit this year, this outcome will still be higher than any deficit in the Fraser years and will be twice the average deficit levels during those seven years. In the light of all the whingeing that goes on in the House about how terrible the Fraser Government was, it is interesting to make these comparisons. The Government has made much of its small increase in spending, but if one looks at the Budget Papers one sees that outlays in 1985-86 are expected to be 29.8 per cent of gross domestic product-the third highest level in Australia's history-and they were beaten only by the first two Hawke Budgets and equalled by the last big-spending Whitlam Budget. So, in effect, this is back to 1975 stuff here, which is quite interesting because there is a big difference between the rhetoric about economic performance and the actual figures. Mr Brumby —You don't really believe this stuff? Mr CARLTON —The figures are all in the Budget Papers, if the honourable member would like to look at them. Those Papers are prepared by the Treasury- Mr Brumby —I have the Budget Papers here. Mr CARLTON —Certainly the honourable member will be able to check these figures out in the Budget Papers. The average real increase in the first three Hawke Budgets was 4.9 per cent, more than twice the average real increase in the seven Fraser Budgets of 2.2 per cent. Those figures are also available directly from the Treasurer's Budget Papers. That fact cannot be denied, even by the honourable member for Bendigo. If we look at the public debt, the Commonwealth's public debt interest bill, which does not include the States or the statutory authorities, will be a massive $6.724m in 1985-86-an increase of more than $1 billion over last year, or almost 19 per cent. So public debt interest is the largest individual item of spending after social security and payments to the States and local government. In other words, in this year's Budget we are spending more on interest costs than we are spending individually on defence, health and education. That is where we have got by this high spending policy. In fact, the interest charges have doubled in the three Keating Budgets from $3,378m in 1982-83 to the present level of $6,724m. Let me put that in terms that everyone can understand because this is a pretty frightening figure. The fact is that $6,724m interest costs-and people do not generally understand billions and millions-actually costs each individual taxpayer $20 a week. When one gets one's pay packet and looks at the pay slip, one should realise that $20 each week is contributed to interest charges alone. If a taxpayer is paying much higher interest rates on a home loan, on hire purchase payments and on Bankcard, which has just gone up to 21 per cent, and on all those other charges which have increased enormously over the past few months, despite the promises by the Prime Minister and the Treasurer before the election that they would reduce interest rates, he must realise that after paying his own private interest bill, an average of $20 a week over and above that goes to meet the Federal Government's interest bill. Then, of course, there are State and local government interest bills to pay on top of that. We have a pretty high overseas debt in this country at the moment, both private and public, and both of those are worrying. What are the problems arising from these levels of debt? First, there is the question of the burden on the Budget of servicing public debt. If one is trying to construct a Budget and find funds to pay pensions, improve health services, which are a disaster at the moment, improve education and all those basic things we need, and trying to keep our soldiers, sailors and airmen properly paid, before any of that can be done $6.7 billion must be paid in interest charges. That is an obvious problem with inflationary effects as well. To the extent that money needs to be borrowed in Australia-in other words, there is not enough money on current account and it needs to be borrowed in order to pay off this debt and to meet costs-it places additional pressure on already high interest rates. Interest rates are very high at the moment-18 1/2 per cent at the prime rate and many interest rates for business are more than 20 per cent. If the Government is making additional demands, if it has to go out and borrow additional money as well, that will have an upward pressure on the general level of interest rates, and that has flow-on effects into the economy. If interest rates go up substantially the effect is felt on all costs, not just domestic costs. The effect is felt in interest rates on home loans, overdrafts, finance purchases and Bankcard and also on every interest charge that is placed on a business. Charges will go up for small business borrowings, borrowings on overdrafts for working capital, borrowings for investment in, say, new plant, an extra shop or any productive investment. If interest rates on such borrowings went up from 12 1/2 per cent to, say, 18 per cent or 20 per cent, as they have risen over the last year or so, that would push up costs and would also have the effect that one would not want to go ahead with new activities. It would ultimately have a very depressing effect on business investment. The Treasurer has claimed that people are falling over themselves wanting to borrow money at 20 per cent in order to make investments. I simply do not see that happening around the traps. I do not see small businessmen in my electorate rushing out to borrow money at 20 per cent in order to push up their overall level of debt to a level which would make them go broke if there was any fall off in the economy. It is simply not happening, and this is a fiction of-- Mr Brumby —Who is borrowing the money? Mr CARLTON —Some of the people honourable members opposite are always attacking. When money is borrowed abroad the need to meet the interest and capital repayments on overseas debt, particularly when it is added to the present high level of private overseas borrowings, soaks up our overseas earnings. The balance of payments figures for September were released today. They are not very good. They show a further deterioration in our balance of payments; in other words, this month we have added substantially to our overall level of overseas borrowings and, therefore, we have added to our debt servicing and capital repayment commitments. That presents some very grave difficulties for economic management. In a word, this month's figures are crook. The Treasurer admitted earlier in the debate on the matter of public importance that the figures were crook, but he said that they were in line with what the Treasury forecast said they ought to be. That does not cut any ice with me. If the Treasury forecast says we will have crook figures and if they come out as crook, they are still crook and the overall position is not in any way diminished. Those figures are very bad. How does that affect us? At the moment, it affects us in rather a serious way because for the first time in a very long time in Australia's history overseas lenders are beginning to question Australia's international credit rating. When the Western Australian Government recently wanted to borrow some money overseas, for the very first time overseas banks asked serious questions about the capacity of that Government to pay back that money. Those are the sorts of questions that governments in Australia have not had to face up to before because we have a treble A rating around the international borrowing traps. That was an interesting sign that people are beginning to worry about our overseas indebtedness and our capacity to meet our interest and capital repayments. They are beginning to question it. There is a magazine called the Institutional Investor, which is widely read around the world by those investing in various economies. It recently conducted a survey of international banks to see how they rated the credit worthiness of various countries borrowing money on the international stage. The sad news from that survey, which was published a couple of weeks ago, is that Australia had slipped quite substantially in recent times and had been slipping since the Hawke Government came to power. Although we had a devaluation in the Australian currency, which was supposed to give us the chance to improve our domestic economy, to push up local manufacturing, to replace imports and to give us a competitive advantage, it seems that the dollar is still suspect in international circles. In recent weeks, it has started once again to look shaky against the currencies of our trading partners. All this, combined with the additions to our overseas debt and the concern of international investors about our credit worthiness, gives us some domestic concern for our economy. Of course, the Treasurer is in a rather difficult position because he has to try to keep up the value of the dollar. A further devaluation of the dollar would mean that import costs would rise and the extra costs would flow into the economy. It would have an inflationary effect on prices, which would go up internally. The consumer price index would reflect that increase. Under the automatic wage indexation provisions of the Australian Labor Party-Australian Council of Trade Unions prices and incomes accord, the unions would expect an automatic increase because prices had gone up, even though the only reason for their going up would be the higher cost of imports due to devaluation. This all happened a few months ago and the Treasurer had the very difficult job of negotiating with the ACTU some kind of discounting of the CPI for wage increase purposes. He made a deal which he regarded as very good but which some of us regard as being pretty second-rate whereby, although the inflationary effects of devaluation have already started to flow back into the economy, they will not be reflected in wage increases until a period of six months has elapsed. So the Treasurer made a partial deal but still admitted that costs over and above that which would ordinarily be worked out on the formula would flow back into the economy; in addition, of course, there is that delay of six months. If there is a further devaluation and if overseas investors rate the Australian dollar at less than its current level, this whole cycle will have to be gone through again. Dr Harry Edwards —You would get the accord mark 3. Mr CARLTON —Accord mark 3, as the honourable member for Berowra so correctly says. We would have the same old cycle of devaluation and inflationary pressures on the economy, with imports rising. The Government would have to go back once again to the ACTU, with cap in hand, to ask it: `Please let us discount the inflationary effects of what we have just done?'. That is why the Government is terrified about the possibility of a fall in the dollar. That is why it has to maintain a strict monetary policy to keep up interest rates, which it is doing. It is in a very difficult position as it cannot really say how long that would have to go on. In the Australian Financial Review of last Friday there was a report from a respected economist, who stated that no easing of interest rate pressures was foreseeable by the end of the year. Indeed, if we look beyond that, there are no factors we could look at which would give us any hope of a falling off in interest rates. Really, we are between the devil and the deep blue sea. On the one hand we have very high interest rates causing inflationary pressures which will eventually stop investment and will have an effect on the CPI, thus pushing wages up; on the other hand, if we do not keep up those high interest rates we will run the very severe risk of devaluation, with roughly the same consequences on the other side of the equation. Those are the reasons why this economy, which is claimed by the Treasurer to be the best ever, is fairly shaky when one examines its basis. It all comes back to the mechanism of the Loans Bill 1985 which we hope to pass in the House today and the purpose of which is to make provision for financing Budget deficits. It gives the House the opportunity to reflect a little on the longer term consequences of the policies that have been pursued by this Government and to examine how difficult it would be to fulfil the various promises the Government has made. We in the Opposition wish to draw attention to these things. We certainly do not take any pleasure in the fact that interest rates are at their most historically high level since the Great Depression; we merely warn the Government that unless there is some realistic assessment of the overall economic policy and an end to this self-congratulatory mode into which the Treasurer has moved, all Australians will be suffering in the medium to long term. Mr BRUMBY(Bendigo)(4.10) —Honourable members would be aware that the expenditure from the Consolidated Revenue fund cannot validly exceed revenues available to it and that in order to avoid obtaining approval for additional borrowing from the Australian Loan Council, over a period of years successive governments have introduced legislation in the form of a loan Bill which provides for the financing of the Budget deficit. The Bill before us today is the Loans Bill 1985. This Bill makes provision for the financing of the prospective 1985-86 deficit. I take this opportunity to make some general observations on the fiscal and economic policy which has been pursued by this Government with particular reference to Australia's international indebtedness and the measures which have been taken by the Government to reduce this debt. In the broader sense, there is no doubt that Australia is poised to experience its third successive year of strong economic growth, through 1985-86. In doing so, the economy will be building on the progress which has been made over the past two years and in particular on the strong recovery that has been so evident in the private sector. The 1985-86 Budget provides for a deficit of around $4.9 billion. Such a deficit represents 2.1 per cent of gross domestic product and compares with the prospective $9.6 billion deficit that we inherited in 1982-83 when we won government and which would have represented almost 5 per cent of total GDP. It is worthy of note that, in difficult economic circumstances, the Hawke Government in its three Budgets has reduced the Budget deficit as a proportion of GDP from the prospective 5 per cent that we inherited to 4.3 per cent in 1983-84, 2.7 per cent in 1984-85 and 2.1 per cent for this Budget. Again, it is worthy of note that the current level of 2.1 per cent compares with an average deficit level of 2.9 per cent of GDP through the 10-year period to 1983-84, the majority of which years were of course under the Fraser Government. I repeat that this year's Budget deficit is 2.1 per cent as a percentage of GDP and the average over the last 10 years to 1983-84 has been 2.9 per cent. It is pleasing that against the background of that marked fall in the Commonwealth sector's borrowing requirements associated with the lower Budget deficits and a reduction in borrowings by Commonwealth authorities, the gross public sector borrowing requirement was reduced by one percentage point in 1984-85 to 7.3 per cent of GDP and by 1.5 percentage points to 5.7 per cent of GDP on a net basis. The lower Commonwealth Budget deficit for 1985-86 and the restraints on borrowings at all levels of government agreed at the Premiers Conference and Loan Council in May 1985 will ensure that there is a further significant reduction in the public sector borrowing requirement as a share of GDP in 1985-86. Real growth in outlays of only 1.3 per cent in this Budget and the Government's commitment to its so named trilogy of budgetary restraint over this term of government will undoubtedly and unquestionably ensure further reductions in 1986-87 and beyond in the Government's public sector borrowing requirements. Those on the Opposition benches and others in the community who seem to be in many ways ignorant of the realities of government spending programs have over recent times been calling for even larger reductions in levels of government spending. These calls are particularly hypocritical, emanating as they do from an Opposition which left this Government with a projected deficit of $9.6 billion and which during its famed razor gang exercise managed to reduce government spending by only a few hundred million dollars throughout that whole tortuous program. The Opposition's rhetoric simply does not match its performance. The Opposition's performance ought to be compared with this Government's achievements in holding growth in outlays to 1.3 per cent in real terms in this Budget, as well as in May cutting $1.2 billion off the forward estimates of spending programs and reducing the overall Budget deficit from that prospective $9.6 billion which we inherited to the 1985-86 prospective figure of $4.9 billion. We have done all of those things in the space of less than three years. They are notable achievements and compare more than favourably with the performance of the Fraser years. But those who call for even greater reductions in government outlays need to recognise that almost 60 per cent of all outlays are subject to some form of indexation arrangements. Public debt interest accounts for a further 10 per cent of outlays. It needs also to be said that where the Government has acted to make savings in some of the big ticket outlay areas like social security by introducing the assets test to means test more effectively pension payments, it has been the Opposition and those who are most vociferous in their calls for lower government spending who have been squealing the loudest about our endeavours to make those cuts in areas such as the assets testing of pensions. I make it quite clear that I am no advocate of excessive or profligate government spending or of the unnecessarily high taxes required to support it. But the debate about lower government spending needs to be kept in a proper and sensible perspective. There are some fundamental facts which need to be known and they need to be properly understood. I will make just three points about that. First, by the standards of most countries of the Organisation for Economic Co-operation and Development, neither taxes nor government expenditure in Australia are high. Australia ranks about sixth lowest of the 23 OECD countries in taxes and government expenditure as a proportion of GDP. The second point I wish to make concerns the effect on Commonwealth Budget outcomes through the payments of unemployment benefit and income and other taxes forgone as a result of today's unemployment level. If we look at that area and compare it with the level of unemployment in the 1960s, that additional cost and payment in outlays to the Commonwealth is around $5 billion. The extra interest payments required to service the cumulative deficits caused by unemployment over the last 10 years is another $2 billion to $3 billion. (Quorum formed) Before I was interrupted by the honourable member for Fisher (Mr Slipper) who called a quorum by drawing attention to the state of the House, I was talking about the Budget deficit and the inability of the Opposition to understand some of the realities about the Budget deficit. I was saying that 65 per cent of total government outlays involve some form of indexation and a further 10 per cent are related to debt payment. If we look at some of the things we have done to make savings in some of the big spending areas like social security where we have introduced the assets test, it is the Opposition and its supporters and those who argue most strongly for reductions in government spending who are the most vociferous in their calls for lower government spending. Members of the Opposition are hypocritical and do not understand the facts. Let us look at what they did a couple of months ago at the Liberal Party council meeting. Here we have a real example of the intelligence of members of the Liberal Party and members of the Opposition. At that council meeting they called for a 4 per cent reduction in government spending. We do not have to be mathematical gurus to know that a 4 per cent reduction in government spending in real terms would require us to cut $9.3 billion off this year's deficit. The mindless automatons opposite want us to cut $9.4 billion of the Budget deficit. They are not in the House now as they do not like to face the sad reality but I shall explain what it would mean to cut $9.4 billion off the Budget deficit. Firstly, it would mean abolishing any free issue of the Australian flag. That would be a disgrace. Secondly, it would mean cutting back $20 a week on all age, war service disability, invalid and widow's pensions, the supporting parents benefit and the unemployment benefit. Mr Kent —That is what they want. Mr BRUMBY —That is what they want, as the honourable member for Hotham says. They want to do that. But that is not all because there is only about $1m or $2m in that. We would have to scrap completely the family allowance. What about industry? Honourable members opposite are said to be big supporters of industry. Thirdly, we would have to cancel all payments for industry, the arts and foreign aid. What about cockies' corner? I have gone about half way through the list. To find that $9.4 billion we would also have to abolish the Department of Primary Industry and all the payments that are made through it. I see that two members of cockies' corner are in the chamber. They are supporting the Liberal Party council's call to cut spending by $9.4 billion, which would mean the end of the Department of Primary Industry and all payments made through it. Finally, of course, we would have to close down the Australian Broadcasting Corporation, the Commonwealth Scientific and Industrial Research Organisation and the Atomic Energy Commission. Even after we had done all those things we would have to find another $800m-worth of cuts to do the job. That is what the Liberal Opposition has been calling for. As I have said, we have brought the deficit down from a prospective $9.6 billion, which we faced when we came to government after those disastrous years in office of honourable members opposite, to $4.5 billion. We have reduced it from almost 5 per cent of GDP to 2.1 per cent. The honourable member for Charlton (Mr Robert Brown) knows full well that that is a great achievement indeed. Most importantly, we have kept spending growth in real outlays this year to 1.3 per cent in real terms. We have managed to do that while, at the same time, protecting those in the community who need the support of the government. We have done that by protecting them through our welfare programs and, at the same time, we have managed to keep the economy turning over at record growth rates. For the third year in a row we have had a 5 per cent growth in real non-farm GDP. That is an achievement that has not been equalled by any government since World War II. The Hawke Government has achieved it. It has achieved it with a great team of Ministers, a great Cabinet and, above all, a great team of back benchers. I shall conclude by making a few points about the external debt side of things. I know that my colleague the honourable member for Maribyrnong (Mr Griffiths) will also speak on that area. We have heard a lot about the external indebtness of Australia and the buildup of foreign debt. If we look over our performance in the last few years we will see that we have been generating levels of current account deficits which are not sustainable indefinitely. The Government recognises that and it has taken measures to put an end to that and to restore the competitive edge to the Australian economy. Advertisements have been placed in papers about our foreign debt. Over the last few years the level of Commonwealth debt has doubled from about $6.7 billion to about $12 billion. Honourable members would be aware that most of that is well covered by our foreign exchange holdings. The area that has really exploded in terms of foreign debt is the private sector. That area has increased six-fold since the early 1980s. So in talking of foreign debt we on this side of the House agree that we cannot produce current account deficits indefinitely; they are not sustainable. What we can do is take measures to reduce the amount of indebtedness. Perhaps the most important thing we can do there is get the economy turning over again, keep it going fast, keep the growth rates high and get back to international competitiveness. We have done that through the prices and incomes accord. All the countries in the OECD are talking about the success of the accord. We do not have to big note the accord because people are doing it for us overseas. They are all talking about Australia's prices and incomes policy as the policy that has allowed us to get sustained levels of real economic growth, and sustained levels of job growth while, at the same time, keeping inflation down to a satisfactory level and restoring international competitiveness. I wish to summarise a few of the points I have made today on this Loans Bill. I have said that in terms of the deficit-that is what this Bill is about; it is a Loans Bill to finance the deficit-we have brought it down from a prospective $9.6 billion to $4.9 billion in 1985-86. In terms of a proportion of GDP-perhaps this is the most remarkable aspect of our performance as a government-we have brought that deficit of $9.6 billion down from 5 per cent to 2.1 per cent. I repeat what I said earlier: Members of the Opposition can whinge and go on all they like. They talk a lot of nonsense. Unfortunately, they did not learn anything when they were in government. If they had half a brain they would be dangerous. We should compare that 2.1 per cent in this Budget with the average for the last 10 years of 2.9 per cent. We have done that. We had the May economic statement this year. We kept growth in real outlays to 1.3 per cent. We have done that, most importantly, at a time when we have looked after people in need in our community. We have kept the economy going at a great rate. We have improved our international competitiveness. We have generated 487,000 new jobs in less than three years. No government has done that before. I know that I do not have to repeat it but it is important to say it. Mr Griffiths —I would like to hear it again. How many? Mr BRUMBY —We have generated 487,000 new jobs. Mr Hand —What did the Opposition do when it was in government? Mr BRUMBY —The honourable member for Melbourne, who is an assiduous member, asked what the Opposition did when it was in government. I make the point that we have created more jobs in two years than the Opposition did in seven years. That is the extent of our performance. It is only a matter of months now before this Government clocks up 500,000 jobs. We will do it in under three years. That is an achievement unparalleled in Australia's economic history. There has been a 5 per cent growth in non-farm GDP. Industrial disputes are at their lowest levels for 17 years. The rate of increase in real labour unit costs is at its lowest level for more than a decade. So we have got all the fundamentals right and this economy is starting to take off. The economic illiterates opposite simply cannot seem to grasp that. All they are doing is going out into the market-place and overseas and trying to bag this Government and to run down the achievements of this economy and to run down the achievements of industry in generating new jobs. In conclusion, we have had economic idiocy from honourable members opposite in calling for a $9.3 billion reduction in this year's Budget deficit. As I have said before, to do that we would have to cut every single pension payment in Australia by $20 a week. We would have to terminate the family allowance. We would have to cancel every payment to industry, the arts and foreign aid. I do not know where the members of cockies' corner are-there are still one or two of them in the chamber-but we would have to abolish every payment made through the Department of Primary Industry and, of course, we would also have to close down the ABC. Even then we would have to make another $800m in cuts. So it cannot be done. We have provided the lead. We are acting responsibly. We have the fundamentals right in this economy and we will go on to create even more jobs and look after the people who need them in this community. Dr HARRY EDWARDS(Berowra)(4.30) —I will not attempt to speak directly to that tripe about cutting this and cutting that. The Opposition has made no such suggestion. The honourable member for Bendigo (Mr Brumby) is just using his imagination. However, I cannot help but refer to the fact that when it comes to the question of employment and unemployment, and without saying that the result in terms of growth and the increase in jobs is not gratifying, which it is, a substantial part of that increase is due to the bounce back from the 1982 recession and it is by no means a net gain on 1981. In fact, the Government ought to look at the 1981 situation. It corresponds under our tenure of government with the cyclical situation of the present Government today. If it were shown on a technical Phillips curve, if the inflation and unemployment situations are combined, the 1981 situation would be almost comparable with the situation the Government is in at the moment. However, in 1981 the unemployment situation was about 5.6 per cent, but, present unemployment level is 8.1 per cent, even on the best of interpretations. That unemployment figure of 8.1 per cent is higher than it was in six out of the seven years of the Fraser Government. Mr Lloyd —What were those figures again? Dr HARRY EDWARDS —The unemployment figure today is 8.1 per cent and in 1981 it was in the order of 5.6 per cent, significantly less. In six out of the seven years of the Fraser Government it was significantly less than 8 per cent. Honourable members opposite should look at the figures before they put this misleading information before us. Mr Robert Brown —No more wild horse chases. Dr HARRY EDWARDS —The Government has that type of record in some respects when it comes to interest rates, the difficulty with the balance of payments, and the currency. This is a debate about the deficit and the financing of the deficit. Before I go on to the remarks I intend to make, I want to pick up the constant reference throughout the speech of the honourable member for Bendigo to the $9.6 billion `deficit' which was allegedly handed over to this Government by the former Government. He used that as if it was a real figure, and then calculated today's deficit in relation to it as as though some massive change has been achieved. It is true that the then Treasurer, the honourable member for Bennelong (Mr Howard) now the Leader of the Opposition, did not release that projected estimate of the deficit for 1983-84-we are talking about a situation in February 1983-because it was meaningless in respect of what the actual deficit would be when the chips were down in the Budget determining process. The Special Minister of State (Mr Young) had a go at the same thing here on Friday. He quoted the then Treasurer as saying at the time: `True, the deficit is trending higher than the then current $4.4 billion deficit of 1982-83'. The honourable member for Bendigo today, the Special Minister of State last Friday and the Prime Minister (Mr Hawke) the other week, debating of all things the Australian Bicentennial Authority and his behaviour in that respect, all made reference to this matter. It is about time the Australian Labor Party gave up this manifestly phoney, misleading and false charge. It was particularly significantly because, as we all know, the Government then, spuriously, went on to justify abandoning much of its ALP platform on the basis of this figure. I want to make two points on this: Firstly, the honourable member for Bennelong was quite right in what he said about the deficit `trending higher than the 1982-83 figures', because when the Labor Party won office and assumed actual responsibility for the 1983-84 deficit, it brought in a deficit of about $8 billion, which included additional outlays in respect of its new programs of the order of $2,500m. In short, it got the projected no policy change 1983-84 deficit down from the $9.6 billion to about $5.5 billion; about the sort of deficit which it is likely to realise this year. In government we would have pruned it even further. So in fact the deficit was, as the honourable member for Bennelong said, trending higher than the then $4.4 billion of 1982-83, but only about 25 per cent higher, not higher to the extent of a $9.6 billion deficit as government members accuse. This second point really takes the candle. When the corresponding forward estimate for 1984-85 was provided to the Hawke Government last March twelve months, the Prime Minister, in a weekend interview, described it as `illusory'; and the Treasurer (Mr Keating), when questioned in Parliament the following week, stated that the deficit estimate was based on projections that were so uncertain that they were virtually meaningless, and he refused to release the estimate- Mr Robert Brown —Very wise. Dr HARRY EDWARDS —Very wise! Yet he and his colleagues pilloried the former Treasurer and the former Prime Minister for not releasing the previous one which was even less securely based. So then, they refused to release the corresponding estimate for 1984-85 that, as I said they so pilloried the then Treasurer and the Prime Minister for not releasing in respect of 1982-83. It is no wonder that at the time the Australian Financial Review had a leader headed `Deficit duplicity', and I think the Canberra Times had one headed `Prime Minister's image damaged'. It referred to the `deficit duplicity' on the part of the Prime Minister and the Treasurer and referred to the whole exercise as `. . . being reduced by the Treasurer, Mr Keating, to one of cynical expediency', which indeed it was and is. The Prime Minister, the Special Minister of State and the honourable member for Bendigo ought to be ashamed for continuing to propagate that lie in this place. The purpose of the Loans Bill, which is before the House, as previous speakers have said, is to provide for the financing of the prospective Budget deficit for 1985-86, a major thrust being, of course, to provide for the charging of defence spending to the Loan Account to relieve the pressure on the Commonwealth Revenue Fund. While this Bill provides a formal framework in respect of the financing of the deficit, it does not get down to the nitty-gritty of what is actually done to finance the deficit. I suggest that, for example, we take the deficit of $6.7 billion in the year to June last. As I said in a brief comment in the adjournment debate a few weeks ago, an important feature of this year's Budget Papers which has gone unremarked is the Hawke Government's inflationary financing of that deficit. It was a deficit second only to the $8 billion of the year before. But what has not been openly recognised is that the Hawke Government relied on the Reserve Bank of Australia to finance directly or indirectly fully half of that $6.7 billion deficit. That is inflationary finance on a large scale by any standard. Indeed, as I said on that earlier occasion, such a resort by the Hawke Government to central bank financing is tantamount to printing money. It is reminiscent of the Whitlam era, as a reference was made by the shadow Treasurer earlier in his remarks, or perhaps of the activities of Dr Jim Cairns when he was Treasurer. The circumstances leading to that were: During the first part of the 1984-85 financial year the Government was out to keep the lid on interest rates during the election campaign. In that context there was then the necessity to finance its own profligate spending, the very large increases in spending provided for in the 1984-85 Budget for everything except a few areas such as science and food aid, which apparently it did not rate. There were very big increases. Sport and recreation was up by 60 per cent; the community employment program was up by 40 per cent; spending on housing grants was up by 83 per cent; spending on the Australian Bicentennial Authority was up by 352 per cent; and so on. It was necessary to finance the Government's profligate spending, while at the same time there was strong growth in private sector activity and its demand for finance. In addition, there were complications from the devaluation. In those circumstances the domestic capital markets could not possibly absorb the demands made upon it by the Government. In responding to a question without notice touching on this matter which I asked some weeks ago, the Treasurer referred to the Government's very proper bond selling program to finance the deficit in the 1983-84 financial year, but he had less to say about 1984-85. It is clear from page 77 of Budget Paper No. 1, Statement No. 2, that initial subscriptions of $7.6 billion to the gross issue of Government bonds during the year were made on the normal scale by the trading banks and, more importantly, by the non-bank sector. Subsequently, a large swag of the holdings were `refinanced'-that is, bought-by the Reserve Bank with the effect of pumping new cash into the system on a large scale. In the outcome the cash-base growth was up 50 per cent on 1983-84 and the increase in money supply, as measured by M3 at $13.4 billion, was nearly twice the growth of the previous year. Whatever the complications of interpretation arising from deregulation in the financial system, that hardly qualified as a `firm monetary policy', as the Treasurer averred the other day that the Government had run `at all stages', and it bodes inflation trouble down the track, albeit policy currently is tight. Returning to financing the deficit, I refer to the table at page 385 of Budget Paper No. 1, part of which I seek leave to have incorporated in Hansard. Leave granted. The table read as follows- Table A: Changes in Holdings of Domestically-issued Commonwealth Government Securities and Other Financing, 1982-83 to 1984-85 ($m) 1982-83 1983-84 1984-85 DOMESTIC FINANCING (NET)... 4049 7895 6122 Bank... -171 714 4277 Reserve Bank (a)... -1621 -936 3377 Trading Banks (b)... 500 561 1149 Savings Banks... 950 1089 -249 Non-Bank... 4220 7181 1846 Authorised Money Market Dealers... 539 -46 -452 Life Offices... 459 1015 -133 Other Non-Bank (c)... 3222 6212 2431 OVERSEAS BORROWINGS (NET)... 586 362 906 Gross Raisings... 1153(d) 1178(d) 1815(d) US Dollar... 418 996 440 Pound Sterling... 176 148 . . Deutschemark... 170 . . 236 Swiss Franc... . . 30 259 Yen... 233 . . 733 Guilder... 154 . . 139 Reypayments... 568 816 909 Less: Discount on Treasury Bonds... (-)168 (-)297 (-)282 TOTAL FINANCING TRANSACTIONS... 4467 7960 6746 (a) Includes increases in the Reserve Bank's holdings of Treasury Notes, Bonds and Bills plus decreases in the Commonwealth's cash balances at the Reserve Bank. (b) Includes Development banks. (c) Includes Income Equalisation Deposits, State domestic raisings and other financing transactions, not elsewhere identified. (d) Gross raisings include, by accounting convention, payments from the international Sugar Organisation. Dr HARRY EDWARDS —I thank the House. It can be seen from the table that the crucial non-bank contribution, which represents genuine domestic savings, was very low. With the deficit at $6.7 billion it was only $1.8 billion net. In contrast, in the previous year, 1983-84, the non-bank sector contributed $7.2 billion towards the then deficit of $7.9 billion. In that year the Reserve Bank actually decreased its holding of Governments securities by almost $1 billion. But in the past year the central bank contributed, directly or indirectly, some $3.4 billion-fully half of the deficit funding requirement. As I have said, there was a significant exercise in printing money and inflationary financing. I referred to the Reserve Bank contributing directly. Included in that direct contribution was the acquisition by the Government from the Reserve Bank, in exchange for bonds, of foreign currency reserves of the order of $1.5 billion. That really represents a straight-out raid on the overseas reserves. The Government avoided the due process of borrowing, as a means of minimising the impact of its overall profligate spending on interest rates and the weak Australian dollar. By proceeding in that way the fundamental problem of the nation living beyond its means was not addressed. The proper process in this regard would have been to make an additional public bond issue designed to tap genuine domestic savings and then to purchase foreign exchange from the foreign exchange market with the proceeds. Of course, that would have put more pressure on the weak Australian dollar, as compared with acquiring the foreign currency by appropriating it from the Reserve Bank stock. It would have put added pressure also on domestic interest rates. But in the outcome, the overall effect would have been less domestic savings available to others in the economy; hence, indirectly, a lesser demand on the balance of payments and a lesser balance of payments deficit, thus a lesser degree of the nation `living beyond its means', and generally a more responsible outcome. Turning to the 1985-86 Budget deficit, the first point I make is that the deficit has a shop-front label of $4.9 billion. However as has been widely pointed out, the $4.9 billion is achieved after a very large and questionable leap in the payment to the Government's revenue to be made by the Reserve Bank of the order of $800m. That has been based largely on paper gains in the Australian dollar value of foreign exchange reserve sales. As John Stone, the former Treasury Secretary, cogently pointed out, it is tantamount to reducing the deficit on the basis of printing money, this time through the currency depreciation process. After the 1984-85 effort, one might say that the Government is getting the printing of money down to something of an art form. As for the financing of this year's deficit, it is evident that again the Government is shaping up to play the same tricky games as last year-to adopt a phrase of Ross Gittins of the Sydney Morning Herald of 31 August-with the financing of the overseas deficit. The overseas deficit is $3.5 billion, of which the foreign currency component is $2.9 billion. The Government proposes to finance this deficit by `utilising interest credits to reserves', then the main part of $2.2 billion will be financed by the order of $1.1 billion of direct borrowing from overseas and $1.1 billion appropriated from the foreign currency reserve. As I said in talking about last year, that is virtually a grab from those reserves-it is a matter of the direct provision of Government bonds-in effect, rather worthless paper-to the Reserve Bank in return for $1.1 billion of real foreign currency which amounts to a raid on this major asset of the country, namely, the foreign currency reserves. Those reserves total about $13 billion and constitute one offset on the credit side to the worrying gross overseas debt of nearly $70 billion gross, to which the shadow Treasurer, the honourable member for Mackellar (Mr Carlton), referred in his speech. This procedure of utilising reserves in this way cannot be other than a short term procedure, in that the foreign currency reserves are finite and will not last indefinitely. The proper and responsible process, in the nation's clear situation of living beyond its means, would have been an additional public bond issue tapping genuine domestic savings and then the purchase in the foreign exchange market of foreign currency with the proceeds. By appropriating foreign currency direct and borrowing direct from overseas, first, the Government's new bond selling program is reduced significantly. To that extent upward pressure on domestic interest rates is reduced, which no doubt is good for the Government in the short term. Secondly, by acquiring foreign currency from the Reserve Bank stock rather than from the foreign exchange market, downward pressure on the weak Australian dollar is reduced. Again, that is good for the Government in the short term. But this is the rub: By proceeding in this way, the fundamental national economic disequilibrium we have-the massive deficit in the overseas balance of payments, which threatens the whole economic strategy, the fact that the nation is living beyond its means, which is the country's underlying problem and challenge-is not addressed. The procedure is, as Mr Gittins said, `a neat trick'. Indeed, it is something of a con. The conduct of policy will need to be more sound and responsible if the Government is to guide this country through the very difficult and complex situation ahead. Mr GRIFFITHS(Maribyrnong)(4.49) —In addressing the Loans Bill 1985 I will take up some remarks of both the honourable member for Mackellar (Mr Carlton) and the honourable member for Berowra (Dr Harry Edwards). The honourable member for Berowra referred to some claims to fame that Mr Stone may have had. Let me say at the outset that it is not my view that the skids were put under Mr Stone in terms of his position at the Treasury. But if I were Treasurer of this Government, I would have reflected on the contribution that Mr Stone made; for example, 10.4 per cent unemployment, which peaked shortly after we gained office. The honourable member for Berowra qualified in some way this Government's success story in terms of the level of unemployment, from a peak of 10.4 per cent to a current rate of 8.1 per cent and declining rapidly. Honourable members will not need to be reminded that that is a record without equal in terms of the countries of the Organisation for Economic Co-operation and Development and, taken in global terms with all the other major economic indices, it is a record unequalled by any post-war Australian government. The honourable member for Mackellar articulated at some length the issues relating to the level of Australia's international indebtedness. I was somewhat surprised that he did that. He reflected on the same topic in this House last week, on 8 October, as reported at page 1644 of Hansard, when he said: Our overseas debt stood at $3,326 for every man, woman and child as at June 1985 compared with $1,571 for every man, woman and child as at June 1983. I recall the honourable member for Mackellar reiterating those statistics in today's debate, and he also added to them. I shall simply paraphrase what he said, because I do not have a copy of the Hansard this early, of course. The honourable member referred to the public sector debt as representing some $864 for each newborn Australian in 1983, and currently representing about $1,670 for each newborn Australian. Of course, in that analysis he took no account of our foreign reserves; nor did he take account of, qualify or attempt to interpret precisely what those figures mean. This `shock, horror' approach, the crude comparison of 1985 figures with 1983 figures, makes very good tabloid politics, but in no way, shape or form does it indicate any degree of political analysis and, more particularly, it makes very shallow the Opposition's claims to any level of economic expertise. The history of the Australian economy is, of course, a history of a net borrowing economy. This was the case throughout the whole post-war period-and, I might add, a not inappropriate approach of successive conservative administrations. The issue upon which this House ought to focus is the extent to which borrowings may actually or potentially be such that Australia's ability to service such borrowings may be brought into question. No one disputes that. It is a fundamental of any government's economic approach. It is not the issue as such with which I have concern. I believe that this Government is taking the appropriate policy approaches, and I shall advert to those later. But it is really the way in which this issue has been misrepresented. It has been misrepresented by speaker after speaker on the Opposition benches. Of course, the issue upon which one needs to focus is the trend line level of current account deficits-not, of course, in nominal terms, as is the wont of Opposition members, but as a proportion of gross domestic product-and the extent to which borrowings to service such current account deficits are sustainable over time. The 1985 Budget Papers contained the following statement: Australia's account current deficit during the 1980s has been at levels which are both well outside the range of previously sustained experience and which are not viable indefinitely. Related to the succession of large current deficit accounts, there has been a rapid growth in Australia's external indebtedness . . . As I indicated earlier, I agree with this analysis, but it is worth making the following points. The inter-relationship between current account deficits and the requirement upon both public and private enterprise to borrow overseas is clear. It is worth noting that the Fraser Government, with Mr Howard, the honourable member for Bennelong, as Treasurer, embraced current account deficits of around 5 per cent of GDP. This has developed into something of a downward trend line-however, with a significant further decline in prospect. I shall articulate why that decline will continue later in my speech. It is clear that a number of variables have impacted to increase the external deficit significantly in recent years. The honourable member for Berowra will no doubt not dispute those variables. It is largely attributable to the increase in domestic consumption expenditure, as opposed to, or at the expense of, domestic investment expenditure over recent years, and, of course, that has been a fundamental problem with our economy and a number of policy approaches have been adopted by this Government in an attempt to address that very issue. Another feature of our external debt is the move away from foreign equity in Australian enterprises to the provision of interest-bearing loans to both the public sector and, indeed, the private sector. As indicated by the Minister for Finance (Senator Walsh) in another place on 11 September 1985: . . . a country which takes capital from abroad exposes itself to greater risk if the capital comes in the form of interest bearing loans rather than equity capital. Of course, that is one of the fundamental issues upon which we ought to be focussing. A potential problem in this regard is that component of our foreign debt used to facilitate corporate takeovers. Throughout these debates, I have not heard any reflection by any Opposition member on the current very high level of corporate takeover activity in our economy. I think that most observers on both sides of the House would agree that these takeovers do not add a great deal to the Australian economy's net wealth or its ability to grow in the future. There are, of course, certain takeovers, rationalisations, and so on, that add to the Australian economy, but, as a general rule of thumb, most honourable members would agree that the very high levels of borrowings required to facilitate the number of corporate takeovers in recent months is not a great contribution to the Australian economy, and it is an issue to which this Government should address its mind. In any event, regardless of the short term problems that may be associated with the particular pattern of foreign borrowing that we have currently, at least some of these problems should be outweighed in the longer term as we have a greater movement, as reflected in those borrowing ratios, to greater equity in Australian companies. It is a self-evident reality that if we can direct a greater component of our investment into Australian equity in Australian companies, in the longer term there will be benefits to be derived from that. One of the important components of our foreign debt is, of course, related to movements in the value of the Australian dollar. I think that the component of our total foreign debt directly related to valuation movements in the dollar is some 20 per cent. How that is manifested, for example, is in the practice of Australian borrowers to contract in United States dollars. This was largely a factor, combined with the float, of course, and the subsequent devaluation of the Australian dollar, in the increase in net foreign debt of about $9 billion in 1985-86, compared to the previous year's figure. But of course, that analysis has really been skated over by the Opposition members, who prefer to talk-and I can understand why they do it-in nominal terms, without explaining any of the very many variables that we must address in this quite complex area. The increase in principal and loan service repayments in such circumstances will, of course, be reversed in the event of an increase in the value of the Australian dollar relative to that of the United States. The honourable member for Berowra will be aware that many economic commentators have been surprised at the continuing high levels of the United States dollar and, in my view at least, there is a reasonable chance that that relationship will change and that the benefits that will follow, by definition, will accrue to Australian borrowers in large part. This scenario is in prospect as the float and devaluation should reduce the current account deficit as a proportion of gross domestic product. Contrary to Opposition orthodoxy, the Commonwealth is not a large net foreign debtor. Improvements in gold and foreign currency holdings have left the total public sector a moderate net debtor, whilst the Commonwealth overseas debt substantially equates with its foreign reserve holdings. So enough of the propaganda from the other side which attempts to distort that fundamental reality. In any event, it is worth concluding on a factual analysis of the components of total external debt of State and Federal governments and statutory authorities, that is, the component of foreign debt guarantee by governments. The article by Mr Leard referred to earlier in debates has been by now substantially devalued in terms of its impact because, quite simply, its approach and figures were wrong. The sum of $26 billion is owed by governments. The figure is not $70 billion as Mr Leard would have it; it is, in a global sense, $68 billion. Mr Leard's figures take no account of foreign reserves. If one takes account of foreign reserves, the net indebtedness, having deducted those items, is some $52 billion. It is up the Opposition benches to explain more fully in its contribution to this area of debate what conclusions it draws from the fact that, of that $68 billion, some $42 billion is owed by the private sector. That is the fundamental. In terms of the Commonwealth Government's position, our foreign indebtedness is in equilibrim with the other side of the equation-our foreign currency and gold holdings. In terms of total public sector net debt, we could be described only as a moderate overseas debtor. The fundamental issue upon which we ought to concentrate is the $42 billion owed by the private sector and, in particualr, the proportion of that $42 billion that is being used increasingly for corporate takeovers that, by any definition and in most circumstances-I stress the latter point-do not add one whit to the Australian economy. Mr HURFORD(Adelaide-Minister for Immigration and Ethnic Affairs and Minister Assisting the Treasurer)(5.03) —in reply-I thank those honourable members who took part in the debate on the Loans Bill 1985. No points of substance have been raised to which I need to reply. However if I have missed any, we will be going through the Hansard record and I will be in touch with honourable members. Again, I thank those honourable members who took part in the debate. Question resolved in the affirmative. Bill read a second time. Message from the Administrator recommending appropriation announced. Leave granted for third reading to be moved forthwith. Bill (on motion by Mr Hurford) read a third time. Consideration resumed from 11 October. Schedule 2. Department of Employment and Industrial Relations Proposed expenditure, $718,056,000. Department of Industry, Technology and Commerce Proposed expenditure, $300,512,000. Mr N. A. BROWN(Menzies)(5.08) —One of the main concerns of the Department of Employment and Industrial Relations is employment growth and the measure of unemployment in this country. We have been told recently that there has been an improvement in employment and a reduction in unemployment. I put to the Committee today that any improvement in employment is welcome, but that before the Government gets carried away with its enthusiasm and, more importantly, before it becomes utterly convinced that its policies are right for continued employment growth, the present results should be put into perspective. When they are put into perspective it will be seen that they are not the glowing success and ringing endorsement that the Government likes to claim. In the first place, the preliminary figures we have recently seen show that the unemployment rate has dropped from 8.3 per cent to 8.1 per cent. The figures for employment growth reveal that there has been an increase in employment of some 56,000, although it should be noted that only 16,000 of that increase is constituted by full time jobs. The remainder, and overwhelming bulk, of the increase is constituted by part time employment. Although what we have seen is an improvement, it should be understood that this is still far too high a level of unemployment. It should also be understood that if the Government is claiming some sort of comparable improvement on the performance of the previous Government, it is simply not borne out by the figures. I make it plain at the outset that I think this debate of `we did better than you' and `no you did not, we are doing better than you did' is singularly unproductive and very sterile in an area that deserves far more concern. The point should be made nevertheless, if the Government is relying on the improvement in the figures, that the present unemployment rate is still higher than it was for six of the seven years of the previous Government. During those years the unemployment rate was frequently 5 per cent to 6 per cent until the country was hit by drought and a recession. A further point that puts the situation into some sort of perspective is simply this: We have had an increase, according to recent figures, of 16,000 in full time employment. When one considers that our labour force comprises 7,334,000 people, one sees that that is not a result about which the Government should be shouting from the rooftops. I make the point again that this comparison is certainly not made for the purpose of scoring any political points but to make the point that, as unemployment is now historically high and seems to be static at an historically high level, now certainly is not the time to pursue blindly existing policies and is not the time, in particular, to pursue policies which can only increase labour costs and, to put it as simply as possible, make it more difficult for employers to employ more people. Paramount amongst those policies is the wages-prices accord which must force into our wage cost structure substantial increases which, at the very least, one should concede is not a policy approach which is conducive to any sort of confidence that there will be substantial increases in employment in this country. The Government has bargained away, in return for nothing, a 3.8 per cent increase in the present national wage case, at least 2 1/2 per cent in April next year and 3 per cent of the 4 per cent productivity claim which will be before the Australian Conciliation and Arbitration Commission next year. If the Government had argued those claims on their merits it may, for all I know, have come to the same conclusion. However, what the Government has done-I venture to say that it will regret it-has been to bargain away those wage cost increases and gain in return little, if anything. In fact, it has lost more than it has gained because it has lost the advantage, which the Treasurer (Mr Keating) was crowing about in his Budget Speech, that the Government could have gained by taking policy decisions which were aimed at holding on to the advantages for the industry of this country of the devaluation of the dollar. Further, there are particular points that should be made about youth unemployment when one looks at it in more detail. The first point to be made is that in September the rate of youth unemployment was 21.6 per cent. It was 21.6 per cent in the previous month also. That is clearly a static situation. If the Government is relying, as I understand that it is continually, on the simplistic point that a drop in the unemployment rate overall shows that its policies are working, presumably it follows that the static youth unemployment rate that we apparently now have must show that its policies are not working for youth unemployment. Secondly, the Government has now admitted that high youth wage costs are a factor in preventing a growth in youth employment. It has admitted it expressly through the mouth of the Minister for Employment and Industrial Relations (Mr Willis) in the extraordinary television interview which is still the subject of almost daily discussion in this Parliament when the Minister conceded that it was crazy, to use his word, that we should have a situation where youth wage rates were in fact in so many cases adult rates and where there were no youth rates and awards. He conceded that that was crazy and, when asked what he was doing about it, there came that historic reply-nothing. It is time the Government did something about it. Not only has the Government admitted this expressly through the Minister; it has admitted it by necessary implication by setting up yet another scheme, the trainee scheme, which I readily concede almost certainly has some attraction, but which employs young people by having them paid less than the award wage. If there is a scheme which is designed to have the employer pay the employee less than the award rate, I cannot think of a more necessarily implied admission that the award rate is too high. If the award rate were not too high, presumably more young people would be employed under it. It is for that reason that the Government has directed its attention on this occasion, properly so far as it goes, towards devising a scheme where the employer does not have to bear the burden of the full award wage cost. If what I am saying is correct and has some substance, what the Government should be doing is to follow that admission through into the wider community. What it should be doing is to support those moves that industry and commerce themselves are trying to make to get more realism into youth wages-not only as part of some scheme across the board so that employers will once again find it economical to employ more young people. There are other things that the Government can do to encourage youth employment. Paramount amongst those is that it should lend its support to those moves for a more liberalised industrial relations system that makes wages more responsive to the individual work place. It must surely be common sense that, if an employer can pay what his employees want, what they are worth and what his business can afford to pay, we will get more employment than is produced by this blind, universal approach which has been accepted in this country. Under our present system it is simply stated that the same wages must be paid, and they must be paid to all employees across the board no matter what an individual business can afford to pay and no matter whether the wages are so high that the employer cannot take on more employees. There are new industries that the Government should be encouraging, instead of adopting what I suggest is simply a blind adherence to what the Government has been landed with. There is great potential in this country for new industries, particularly in communications. Instead of adopting the approach of leaving things to be carved up between government monopolies and private institutions which hold their licences at the behest of the Government it should encourage those new industries. We could have a wide range of new communications in this country, whether based on new forms of radio and television by new licences being granted or whether based on satellite technology. There is a whole range of them which the Government should be supporting and encouraging and not, as is the case in some circumstances, doing nothing about them or, in other cases, setting its face against them. There are other matters that the Government can attend to. In regard to the tax package which is presently before the Parliament and which has been announced by the Treasurer, it must surely be apparent to the Government that there are forces contained within that package which cannot militate towards greater employment growth but which, if anything, will militate against employment growth. We heard the way in which the Treasurer today, in that manner that he so often adopts, simply expressed a complete indifference to employees in the restaurant industry and related industries where one would think the Government would look for more support. They are decisions which the Government is making and which are militating against employment growth. They are militating against the expansion of business and commerce and I venture to say that we will not even see over the next few months the growth in employment that we have seen over the last month. The DEPUTY CHAIRMAN(Mr Blanchard) —Order! The honourable member's time has expired. Mr KEOGH(Bowman)(5.18) —I want to take the opportunity of this debate this afternoon to refer principally to matters associated with the Department of Employment and Industrial Relations. I think it quite appropriate to indicate at the outset of my remarks what an impressive record the Minister for Employment and Industrial Relations (Mr Willis) and the Government have had in this area of government responsibility. The figures released last week by the Australian Bureau of Statistics show that total employment has increased by 487,500 job places in the time the Government has been in office. So far this financial year 103,000 new jobs have been created. Of course, as has been referred to by a number of speakers in the House on a variety of different occasions since then, the Government is very close to achieving that target of reaching 500,000 jobs in its first three years of office. The situation in regard to employment improvement unfortunately is not as good in Queensland than for other States. The news last Thursday contained somewhat better results for Queensland than for other States. The news last Thursday contained somewhat better results for Queensland, but unfortunately it has not reached the stage when one could say it is anything like good news. Whatever the Queensland Government might like to say, the unemployment rate of almost 9 per cent in that State is anything but good news. The unemployment rate among Queensland youth of 21 per cent is nothing short of tragic, but the figures show that at last, in spite of all the obstruction and confrontation from the State Government, the progressive economic policies of the Hawke Labor Government are beginning to benefit Queensland just as they have led to a dramatic turnaround in other States. This is not to say that we in Queensland are out of trouble. As a Queenslander, naturally I am quite worried that the obstinate and obstructionist attitude of the Bjelke-Petersen Government in Queensland could continue to destroy all the gains that the people of that State have made through the initiatives of this Federal Labor Government. Earlier this year we had an example of the arrogance of the Queensland Government when it inflicted immense damage on the struggling Queensland economy by deliberately provoking a power dispute in the hope that it would give it victory in a by-election which was being held at that stage in Rockhampton. Fortunately and understandably the Rockhampton voters refused to be swayed and returned a new Labor member to replace my colleague the honourable member for Capricornia (Mr Wright) who had vacated that seat. Hundreds of millions of dollars were lost during that time by businesses battered in a dispute deliberately provoked by the Bjelke-Peterson Government because it thought it might relieve some of the pressure it was under in the Parliament at that time. Now in another by-election campaign we are set for a repeat of that performance. In an obvious attempt to provoke the trade union movement in Queensland, the Queensland State Cabinet decided last week that it was worth another try and announced that more work in the Queensland power industry would be handed over to outside contractors. The fact that the National Party is again facing a by-election obviously has everything to do with the timing of that decision, as it had with the previous one. Fortunately, I know that the electors in the area concerned on this occasion-the area of the State seat of Redlands comes within my electorate of Bowman-have supported me and the Labor Government in Canberra in the last two Federal elections and they have suffered from the cynical neglect of the Bjelke-Petersen Government over many years. I am sure that they will see the cheap ploy in that Government's announcement about the change in employment arrangements for the power industry. I am sure that they will reject the National Party candidate and see that their representation at State level is by Labor, as it is federally. This afternoon I wish to refer mainly to the very successful community employment program that was initiated by this Government and is administered by the Minister for Employment and Industrial Relations. The problem of unemployment has always been of top priority with the Government, and foremost among the successful schemes for the creation of employment has been the community employment program. In my electorate of Bowman the scheme has been extremely successful. In particular, the Redlands Shire Council and local community groups in the area have used the CEP to create many jobs and to upgrade many existing facilities. More than $2.2m in CEP funds has been committed to help create work for more than 203 local unemployed people. The Budget CEP allocations for this financial year were some $290m on a national level, with some $42.1m going to Queensland. Of this, $10m is available to the Queensland Government for sponsoring projects that it initiates. I am aware that the guidelines for the funding require that 65 per cent of the Commonwealth funds go towards labour costs and I am certain that Queensland abides by those requirements. My concern is that that State Government, in applying for CEP funds, is utilising them for projects that ordinarily would be within its normal range of departmental activities and that in this way Commonwealth funds are being used by the National Party Queensland Government to balance its own budget. To say that least, such action is contemptible. I have here many examples, which I cannot quote this afternoon because of shortness of time, which clearly show that the Queensland Government has unfairly taken advantage of the community employment program. I also have many examples-again shortness of time does not allow me to list them-of massive amounts of equipment being purchased by the Queensland Government for use on these programs. To my knowledge that equipment then becomes part of the State Government's equipment for use in the future on other jobs. Thus, the Government has been saved the initial expense of purchasing the equipment. It is well to consider that that type of equipment should have some offsetting cost so that some of those funds that are used to purchase it can find their way back into the community employment program, rather than into the coffers of the Queensland Government. From talking to my colleagues I understand that the Queensland Government is not the only State Government that is guilty of this practice, but unfortunately in Queensland it occurs much more often. It is an outright abuse of the CEP scheme and is nothing more than arrogant misuse of Commonwealth Government funds to carry out work which should be undertaken by the State Government from its own Budget appropriations. This Government must make a decision about the future of the community employment program after 30 June 1986. I believe, and I put this to the Minister, that the guidelines should be changed. I strongly urge that direct funding to State governments be discontinued when those guidelines are revised. Such discontinuation would prevent any further misuse of funds, and if State governments have a genuine interest in assisting the unemployed and creating job opportunities for them, they will have ample opportunity to undertake that responsibility directly through their own State Budgets. I believe that funds that come from the CEP should be totally allocated to local government and community organisations, which often lack the large funds necessary to carry out those sorts of programs. Certainly they would be able to initiate projects of more direct and general benefit to local communities. It is certainly my wish that the CEP should continue as it provides an important step back into the work force for many long term unemployed. Under CEP these people are given an opportunity to regain their confidence, learn new skills, and have a source of current work experience and perhaps even a recent employment reference, both of which are a definite advantage when applying for jobs. The new scheme the Government has in mind for 16 and 17-year-olds will not become effective for some time. In the meantime many who missed out on employment opportunities when they left school are being and will continue to be assisted by the CEP. Until the new scheme becomes fully implemented they will continue to receive opportunities through the CEP, and in the past it has certainly been of great advantage to the youth in my area. The DEPUTY CHAIRMAN(Mr Blanchard) —Order! The honourable member's time has expired. Mr McGAURAN(Gippsland)(5.28) —In speaking to the appropriation for the Department of Employment and Industrial Relations, I wish to follow the honourable member for Menzies (Mr N. A. Brown) and highlight the disturbing trend in youth unemployment. No matter how much gloss the Government attempts to paint over the situation of youth unemployment, the simple, cold, hard facts are that the problem is not getting better and, in some aspects to which I will address myself later, such as rural unemployed youth, it is worsening. The figures tell a very sad tale. For males aged between 15 and 19 the unemployment rate for September was 20.4 per cent; for females aged between 15 and 19 it was slightly higher at 23.2 per cent. This means that the combined unemployment rate for 15 to 19-year-olds was 21.6 per cent. This is to be compared with the unemployment rate of 6.8 per cent for those aged over 20. This gives us an overall unemployment rate for all persons in the work force of 8.1 per cent. Sadly, I do not believe that this Government is addressing the problems of youth unemployment with the urgency that is required. The priority program upon which the Government has solely relied is in an early stage and my great fear is that, firstly, it will fail to pick up a great many unemployed youth, and secondly, it will fail to pick many of the rural unemployed youth. Few Australians would deny that unemployment and inflation have been the scourge of both metropolitan and rural life of the past 15 years. As we all know, the causes are manifold and the solutions apparently are few. The resources to identify and then perhaps alleviate unemployment are regarded generally as being more abundant in city and regional centres. Youths, always the main sufferers in an economic downturn, have added difficulties and problems with unemployment when they are beyond the limelight of the Press and, in some cases, beyond even their own political representatives. I believe that there are some very serious blank spots in research in this area and for that reason I decided to investigate the issue. Some weeks ago I forwarded to 250 postmasters and postmistresses throughout all States of Australia a questionnaire seeking their views on youth unemployment because they are at the hub of a community, at the coal face, if you like. The towns I chose were in isolated, relatively remote parts of Australia and had populations of between 500 and 1,000. I received a total of 100 replies, and I point out that I received those replies within 48 hours. Regrettably, the Minister for Communications (Mr Duffy) felt moved to veto or prevent any other replies. An instruction was sent out from Australia Post to the postmasters and postmistresses telling them not to answer the questions. The Minister forwarded me his own condemnation. He said he believed the figures and the research obtained would be used in a political sense and that this would be, in some way, politicising public servants. I reject that. I have distributed the results of that survey to all members of parliament. What has to be remembered is that in the country, particularly in the relatively isolated rural areas, youth unemployment exists often to a greater degree than in the cities and larger towns. Employment opportunities are smaller and narrower, with the numbers, size and diversity of industries confined by the limitations necessarily imposed by rural conditions. Furthermore, educational and training facilities are restricted, travel and transport services are reduced and communications are hampered by these places remote locations. As a consequence, the motivation to combat the frequently depressing and debilitating effects of medium to long term unemployment is reduced or lost. Little has been done to measure the extent and effects of youth unemployment in rural Australia. The results of the survey that I undertook were compiled from evidence supplied by front line observers in some of Australia's smaller centres. It sets out, admittedly in only a smallway, to shed some light on one of our more pressing social problems. The survey was based on a set of six questions which sought the respondents' views on the extent of unemployment in their areas, the activities of the unemployed, local support for the unemployed and prospects for improvement. Furthermore, respondents were asked whether any significant support for unemployed females should be undertaken and, finally, what suggestions they could make which they believed would stimulate youth unemployment. The replies to the survey were certainly not exhaustive but the findings represented a pretty fair reflection of opinion on the extent of youth unemployment, its effects and its potential solutions. What can be said is that nearly 60 per cent of the respondents indicated that the problem was worsening in their areas, with 70 per cent claiming little hope for improvement. Prominent among suggestions offered as solutions by survey respondents included: First, more local government supervised youth employment programs; secondly, greater support for industry in rural areas; and thirdly, the initiation of local government and community projects to be paid for with the unemployment benefit, meaning that unemployed youth must undertake some government or community work to receive the unemployment benefit. I call upon the Government to place greater emphasis on local government as a means for dealing with unemployed youth, particularly in remote areas. I also call upon the Government, as a matter of urgent importance, to undertake a national survey into rural youth unemployment. I realise that the statistics gathered by the Commonwealth Employment Service are readily available, but they do not tell us anything like we need to know if we are to identify the sources of unemployment and possible solutions to the problem. The concept of a national survey arose out of a youth unemployment conference that I held two or three months ago in my electorate in the city of Sale. That conference was chaired by Professor Dame Leonie Kramer. More than 130 community representatives from Gippsland alone attended the conference, which again highlights the concern with which citizens in rural and remote areas of Australia view youth unemployment. I thank those good postmasters and postmistresses who replied to the survey. I believe that the full complement of 250 would have done so but for the intervention of the Minister for Communications. Their concise descriptions and open analysis of local conditions are a credit to them and their organisation and, I believe, have contributed greatly to the successful formulation of the survey report which I have circulated. However, I stress it is only a pilot study and so much more needs to be done. One of the most interesting aspects of replies to the survey related to the activities of the unemployed. Respondents to the survey indicated an overall tone of objectivity and understanding in their responses. However, it would not be unfair to suggest that a number of respondents allowed a measure of disapproval to enter their replies. The Government is charged with a special responsibility, and that is to ensure that bias against or disillusionment with the youth of our country is not allowed to foster to any greater extent than is apparent at present. The only way of dealing with this prejudice is to get our young people, particularly our young rural unemployed, back to work. With regard to Priority One: Young Australia, with its almost total reliance on traineeships or work study programs, I urge that local government be accorded many of those traineeships because it is in the best position both to identify and to deal with youth unemployment in rural Australia. Mr ALLAN MORRIS(Newcastle)(5.36) —It is appropriate today that the two departments of Employment and Industrial Relations and Industry, Technology and Commerce, are linked together in this debate on the Budget-Appropriation Bill (No. 1) 1985-86-because it is this Government that actually started those two departments working in unity. In that context, it is appropriate to consider the unemployed and the training of the work force of our community. Investment programs, technology, research and development should all be very much involved with industrial relations and industry and commerce policy making. In recent times, we have seen the result of that policy. Before I come to the main part of my discussion, I wish to express my very deep regret that when the Leader of the National Party of Australia, the right honourable member for New England (Mr Sinclair), was the Minister for Communications, with responsibilities for all postmasters and postmistresses and all the activities of Australia Post throughout Australia, he did not go to the trouble to do the kinds of things that the Opposition is now talking about. In fact, it is rather unfortunate that the Opposition's sudden awareness of youth unemployment, not just in rural Australia but in the whole of Australia, has been so late in coming. Certainly, the previous Government carries a great responsibility for what is perpetrated on the community that it represented. If the current Leader of the National Party had done the homework he should have done when he was the Minister perhaps we as a government would not be facing the problems we are facing now. This is the first Budget in which the technology section has come under one Minister in the portfolio of Industry, Technology and Commerce. That shift, of the technology section has been reflected in the expenditures in the Budget Papers and therefore in the Appropriation Bill. The benefits of that change are now becoming visible with the transfer of the Australian Industry Development Corporation and various other research and technology components to that portfolio. The fact is that under the current Government we have seen massive changes in the last 2 1/2 years in the Australian Industry Development Corporation and in the development of the management investment corporations. Since 1 July, we have had a tax write-off of 150 per cent for research and development expenditure. These changes are very much part of industry policy. They are the precursors of our industrial revival, the industrial rejuvenation, that this country has so long waited for. Looking back at industry employment figures in Australia in recent years, in 1982-83 there was a decline in the metals products section of manufacturing of some 10 per cent. In the following year it declined by another 6 per cent. The fact is that the policies of the previous Government were sending our manufacturing sectors into absolute and total decline. We came to government in March 1983 and industries were on their knees. I pay particular reference to the steel industry. In my area alone, employment dropped from 11,250 in 1981 to just on 6,000 by 1983; in other words almost half of the employees of the Broken Hill Proprietary Co. Ltd steelworks in Newcastle had been retrenched, made redundant or disemployed, whatever term one likes to use. When we came to government Australia had had some 30 years or more of a policy import replacement and the psychology and attitudes which go with that. That particular policy, which was a legacy of the Menzies-McEwen era, was that, if a good was manufactured in Australia, we did not need to import it; tariffs were imposed on those imports to protect the Australian industry. As a pure theory from the conservatives and economic managers of whom the country thought so highly in those days, it seemed okay; but what it created was a situation in which, firstly, the vast majority of our manufacturing industries involved manufacturing under licence with the marketing rights for Australia only, which meant that there could be no export of most of those goods. In effect, we created a high cost, low volume manufacturing sector in Australia. The second result was that we created an attitude, a psychology of: `It does not matter how much it costs or how well we make it; if we become uncompetitive, we will just increase the tariffs'. It was that mentality that made our industries in Australia perform so poorly in world terms. With the introduction in mid-1983 of the steel industry plan, for the first time we saw a great change in the direction of industry policy. Historically in Australia we had had only two models of industry. One model was that of arm's length, which meant that the Government knew nothing about it and it was none of the government's business. The second model was one of nationalisation, which meant that the government owned the industry. The arm's length policy had been significantly deficient, and the steel plan showed that. What the Fraser Government said in 1982, when the steel industry collapsed, was: `We do not know what it is about'. In fact, for the benefit of honourable members, I mention that, when we convened a public meeting in Newcastle to try to come to terms with the problem, the then Federal Government was not prepared to send any Minister to talk to us about it. In fact, what the Prime Minister of the day did was to refer the matter to the Industries Assistance Commission because it might know something about it. The arm's length policy meant that the government knew nothing, could do nothing and therefore in some way could not be held responsible. Of course, under conservative governments we had nationalised industries being part of government policy. The famous example was the Australian National Line, where the public industry aim was to serve Country Party policy and not the people of Australia. With the introduction of the Steel Industry Authority we saw a great change. For the first time we had the establishment of a neutral interface between the industry and government in the form of the Steel Industry Authority, the Authority being made up of government, employees and the employer. That Authority has been seen to be extremely effective. It allows government to be informed by the Authority, which monitors not only Australian industry but also world industry. In other words, somebody in Australia is taking responsibility for measuring, monitoring and looking ahead for the steel industry. The results of that are now becoming very clear. The Broken Hill Proprietary Co. Ltd is undertaking a massive investment program which will be of enormous benefit to the Australian steel industry. We find our industry is becoming competitive and will be able to survive in the future. It takes not just investment by BHP but also investment by government in monitoring and leading and setting the policy climate to allow that industry to recover and to work. The Steel Industry Authority was a precursor to the tripartite industry policy structure. We have now seen its successors in the authomotive industry and the shipbuilding industry. In both cases a similar neutral interface has been established between government, industry and the employees. We are now seeing the recovery in the automotive industry. I can assure honourable members that the figures for the shipbuilding industry are also extremely encouraging. If one looks at the expenditures in some of these areas by this Government, the shift will be seen. For the shipbuilding industry, there has been an increase of almost $20m over the last two years. In the current Budget $35m is being spent on design and research for the automotive industry; in other words, there is a positive contribution by government towards that industry. I make the point that this Government has not said to industry: `It is all your problem. The onus is on you'. We have been saying that the government has a positive role to play. We will play our part if industry plays its part. The unions are required to play their part in terms of industrial arrangements, demarcation disputes and dispute settling procedures. In the last couple of years we have seen the greatest reduction in and the lowest level of industrial disputation for some 20 years. In the computer bounty legislation that we introduced in 1984 we saw yet another shift and extension of government policy. It involved the provision of bounty on sales overseas. What we had had in Australia was a totally inward looking industry policy in which any form of support was available only for the domestic market. That happened with shipbuilding and computer manufacturing. With computer manufacturing we established a policy that makes a bounty available for the value added components in Australia for sales outside Australia. In other words, we saw it as a production bounty. It did not matter whether it was sold in Australia or overseas; the benefit was still the same. For the first time we encouraged our industries to be outward looking, to look beyond the small Australian market and the fairly narrow Australian capacity. The same philosophy was applied to shipbuilding. In Newcastle alone in the last eight months two companies have received enormous benefit with sales to New Zealand as a result of that export bounty on shipbuilding. What we have tried to do as a government is to restructure, rethink and redirect Australian industry. It is a long, slow and hard process. But to date, if one looks at the steel automotive, computer and shipbuilding industries, one sees the results emerging and in terms of new technology as well. The DEPUTY CHAIRMAN(Mr Blanchard) -Order! The honourable member's time has expired. Mr SHIPTON(Higgins)(5.46) —At the outset I would like to remark briefly on the nature of the debate. We are in fact debating in Committee the Appropriation Bill (No. 1) 1985-86 as it relates to the Department of Employment and Industrial Relations and the Department of Industry, Technology and Commerce. The Committee stage of this Bill takes the place of what was an experiment during the Fraser years with House of Representatives Estimates committees, which were abandoned by that Government. I hope that this Government will take on board the nature of the very debate that we are having today. There is a very unsatisfactory element about it in that people from both sides of the House make speeches giving their points of view, but the net result is not discussion around the table as was the case in the old days of the House of Representatives Estimates committees. I believe that this House is at a significant disadvantage compared with the other House, the Senate, which has Estimates committees. We could re-institute Estimates committees to the great advantage of this chamber and its members. It would be particularly advantageous in looking at the detailed statements that we have before us. We have explanatory notes on the estimates of expenditure and receipts from both departments. It is interesting to look at them because they are in great contrast with each other. Although much work has been put into them, the explanatory notes of the Department of Industry, Technology and Commerce are a morass of figures, with little explanation except in the preface. In contrast, those of the Department of Employment and Industrial Relations state in the introduction that an important element of the Government's budgetary and financial management reforms has been the study of the possible introduction of program budgeting. These notes are a start along that track for the Department of Employment and Industrial Relations. I found this very useful in the notes of that Department when compared with those of the Department of Industry, Technology and Commerce. I recommend to the Department of Industry, Technology and Commerce, the Minister for Industry, Technology and Commerce (Senator Button) and the public servants present today a switch to the program budgeting type of estimates preparation along the lines of the estimates of the Department of Employment and Industrial Relations. As is stated, it improves the information available for public and parliamentary scrutiny and for upgrading program management by departments. It makes it easier for all of us, especially members of the House, because, when debating appropriation Bills, we are talking about spending taxpayers' money. In the past there has been a presumption in this country that the more money that is spent, the greater is the job being done. That is a myth that needs to be debunked. We must get to the end of that road. In fact, the more money that is spent the more taxpayers' money is used, and we really have to reduce taxation in this country. The only real way of doing that, rather than by shuffling the deck chairs on the Titanic, which I think this tax package does-perhaps it will make it hit another iceberg-is by cutting government expenditure, and that is what this debate ought to be about. This Committee and, I believe, Estimates committees would provide the venue for honourable members on both sides of the House to look at where the taxpayer is getting value for money. Members of parliament can do that by looking through detailed programs and the explanations of them and they can quiz the departments. In the old Estimates committees the Ministers had officials with them. In this way we can see how the taxpayers are getting value for their dollar. This would facilitate the debate on the cutting of government expenditure, and it is a debate that needs to take place. The debate ought to be on how government can be made more efficient and responsive to community needs and it ought to be about reducing the size of government. In fact, I think that is the great structural challenge. The more all of us on both sides of the chamber talk about the pros and cons of tax packages and the more we talk about changing the taxation system-I do not propose to debate the tax package today-the more we fall into the self-fulfilling prophecy that we will have higher taxation. We need to switch the debate and talk about how we can cut the size of government. If we cut the size of government and have a more efficient and leaner government we will have lower taxation. I think the move towards program budgeting that we see in the employment estimates before us, combined with changes to the committee structure of this place, are ways in which governments can reduce expenditure. I turn now to the industry and technology appropriation in the Budget. I think the Budget itself should be about setting the scene and the climate for the growth of the small business sector. I think the small business sector is the key to the future of this country. It is the key to jobs, employment and profits. The nature of the corporate sector is changing. At present, large corporations are rationalising and cutting costs. They are getting rid of departments and merging with other companies because inflation and costs have affected them dramatically. Large companies are getting rid of advertising and engineering departments and that is providing opportunities for small firms outside to take that work. But the large corporate sector will not be a net generator of jobs in the future. Therefore, we have to look at the small and medium-sized business sector. The job of any government ought to be to create the climate, the framework and the environment in which the small business sector can grow, in which people can be encouraged to invest and commit capital to small business and, having committed that capital, to have profits in that business. Through profits we have jobs. If we do not have profitable companies and a profitable private sector the bottom line is that we do not have employment. That is what the Budget ought to be about. We should ask ourselves whether this Budget is good for small business and, whether it sets in place the framework and creates an environment for small business to invest, grow and prosper. It does not. If we look at the whole series of actions of this Government, of which this Budget is a central element and the tax package is another element, we will see that the tax-wages deal done with the Australian Council of Trade Unions for deferred discounting until April savegely hits the corporate sector. There is no incentive left. Who would want to invest in a new small business today? Governments, in framing Budgets and all policy in the industry, technology and commerce area, have to ask themselves: Will this help the growth of the business sector, particularly the growth of the small business sector? The answer, clearly, in relation to the Budget is no, as it is in relation to the tax package. As I have mentioned, government ought to be creating the environment and the climate for the small business sector to grow. That is where the industrial relations appropriations are interesting. The program is there. As I have said, the appropriations are well set out but they indicate that a large amount of revenue in this country today is being put aside by government for training and re-training, trade training, vocational training, industry training, job creation and employment assistance, employer incentives, community employment, mobility assistance, community youth support schemes, community support-our youth unemployment is one of the highest, if not the highest, in the Western world-and other assistance. In a large part of these estimates the Government programs how we can spend money to help people to get jobs and train people for jobs. I am not knocking people who are being trained for jobs but I wonder how much better it would be if the money was spent not on training but in creating a climate and an environment for small firms to employ those people through a deregulated, flexible wages system-a change to the industrial relations system in this country which is sorely needed. When I was shadow Minister for small business I met many young people who wanted jobs and many employers who said to me: `The award wage is $300 a week but I am prepared to take on a young person to work in this business for $150 a week. There are young people who want those jobs at $150 a week'. How much more profitable would it be and how much expenditure would it save if the employer could make an arrangement for that employee to work in that business? It would save all the training programs because this would be on-the-job work experience and the bureaucracy would not have to administer the training programs. In fact, we would be a saving government expenditure. The DEPUTY CHAIRMAN(Mr Blanchard) — Order! The honourable member's time has expired. Dr THEOPHANOUS(Calwell)(5.56) —Earlier in the debate we heard the honourable member for Menzies (Mr N. A. Brown) say that unemployment still remains high. Nobody is denying that, but one wonders about the credentials of the honourable member for Menzies in coming into the chamber and talking about the level of unemployment as he was Minister for Employment in the worst period since the 1930s recession in terms of the destruction of employment opportunities in this country. We did not hear much from him at that time about the plight of the unemployed. At the time we were in opposition and we made several calls upon the then Government to intervene in the economy, to turn the situation around and to abandon the absurd strategy which it had adopted, but to no avail. Of course, we can see now that not only has that strategy been proved to be a failure in Australia but also it has been proved to be a failure in the United Kingdom. It has been clearly shown that if one tries to control inflation merely by squeezing down on employment and creating high levels of unemployment one does not succeed. The Opposition is still proposing strategies and policies which are identical to those being adopted by the Thatcher Government in Britain and which would be disastrous in terms of employment. Instead of reducing unemployment, they would increase unemployment dramatically. If there is a need to go in a particular direction it is in the opposite direction; that is, in the direction of ensuring that the conditions are created for increased investment and increased job creation in both the public and the private sectors. The Government has done quite a lot in that area. I want to talk about one aspect of it-the positive conditions that have been created for increased investment by the private sector. There are at least three aspects of this which are important and which have set the scene for greater investment by the private sector, yet certain spokespersons of big business have ideological hangups which they continue to bring up in warning businessmen and big business about the optimism which has been created, saying to them: `Perhaps you had better take it easy. Perhaps the conditions are not really quite right'. I will go through the conditions in a moment but in order to back up the point I was making I ask honourable members to look at the statement made yesterday by the Business Council of Australia, which said that although the levels of profitability that have been achieved are substantial we should not get too carried away with all this because, even through there has been an undoubted recovery in profits, we should still take things very carefully and hesitate about investment. In fact, it says that investment should proceed at a slow pace, in a subdued way, rather than take advantage of the positive conditions which have been created. It raises the question as to whether business people are being asked to make decisions in the interests of their shareholders and so on, who they supposedly represent, merely on the basis of suggestions of certain ideological leaders who are clearly very much tied into the establishment of the Liberal Party of Australia and who have no commitment to the wider national interest, which is, of course, to achieve maxium growth and maximum job creation. I have said the conditions are such that there ought to be this investment, and there is no excuse for recommending against such increased private sector investment. Let me mention those conditions. First of all, we had the very substantial devaluation of the dollar which has created the circumstances in which Australian industry is now much more competitive. The devaluation constitutes at least the equivalent of a 12 per cent increase in tariffs in terms of the impact that it is having on competitiveness. The devaluation is levelling out at present and we have a situation where, instead of people taking advantage of it, we have these ideological noises coming from groups such as the Business Council. Instead of seeing the devaluation enjoyed in terms of its economic impact, so that investment is rushed, especially in the manufacturing industry, we have all these warnings for people to hesitate and to pull back. The second factor that is very important is the announcement of the imputation of dividends. As I said in a previous speech, this is probably one of the most historic changes in the taxation system which ought to have a dramatic impact on investment as now the emphasis is away from speculative capital gains and is into those areas where dividends are now paid to the shareholders without double taxation, which has been completely removed. In fact, in certain cases taxpayers will be able to write off part of their personal tax burden through the imputation of dividends phenomenon. Under those circumstances, as has been said for example by the Australian Financial Review, this is an historic change which strengthens the foundations of the economy and of private enterprise. But do we hear the Business Council of Australia and other bodies saying: `We are grateful for this situation. We think this is an historic change.'? Do we hear them rationally responding to this situation? Of course not. We see them putting up propaganda to their various members and telling them that they ought to beware of these policies. Thirdly, we have the growth in domestic demand as a consequence of the general growth in the economy. This is one of the things that has been fuelling the overall growth in the economy and in jobs. But do we see a responsible attempt to take account of this growth in demand? Certainly not. We hear again these kinds of ideological noises. But we also see another phenomenon. We see the Government being attacked because of the high foreign debt. There is no attempt to analyse its sources, but merely to paint over it with a brush and say that the economy is not proceeding as well as it ought to be. But what analysis has been done of the high foreign debt? One has been done by the Department of the Parliamentary Library. I ask permission to incorporate a table in Hansard in relation to this. Leave granted. The table read as follows- Statistics Group DEPARTMENT OF THE PARLIAMENTARY LIBRARY Table 5: Public and Private External Debt As at 30 June Public external debt (a) Amount As a percentage of Exports (c) GDP (d) Private external debt (b) Amount As a percentage of Exports (c) GDP (d) $m Per cent Per cent $m Per cent Per cent 1969... 1,760 45.4 6.4 1,638 42.2 5.9 1970... 1,649 34.8 5.4 2,019 42.6 6.6 1971... 1, 617 32.1 4.8 2,998 59.6 8.9 1972... 1,515 27.0 4.0 4,027 71.8 10.7 1973... 1,376 19.8 3.2 3,997 57.6 9.3 1974... 1,229 15.7 2.4 3,832 49.1 7.4 1975... 1,401 14.1 2.3 4,636 46.7 7.5 1976... 1,436 13.0 2.0 4,631 42.1 6.3 1977... 2,299 17.4 2.7 5,541 42.0 6.6 1978... 4,792 34.3 5.3 5,392 38.6 5.9 1979... 6,625 40.1 6.4 6,095 36.9 5.9 1980... 7,148 33.1 6.1 6,756 31.3 5.8 1981... 6,660 30.3 5.0 9,136 41.5 6.9 1982... 8,804 38.9 5.9 16,099 71.1 10.7 1983... 13,306 54.4 8.0 23,187 94.8 14.0 1984... 16,895 60.8 9.1 28,097 101.1 15.1 1985... 26,123 76.1 12.6 42,343 123.4 20.4 (a) Defined as level of external borrowings of general government and public enterprises outstanding at specified date. (b) Defined as level of external borrowings of private non-monetary enterprises and non-official monetary institutions outstanding at specified date. (c) Exports of Goods and Services for the year ended on the specified date. (d) Gross Domestic Product for the year ended on the specified date. Dr THEOPHANOUS —I make the simple point that two-thirds of the foreign debt at the moment is not owned by governments. It is owned by the private sector in this country. It borrowed money for investment purposes in certain cases, yes, but in other cases it borrowed money for speculative, wasteful purposes, especially in company takeovers. Therefore, it is partly responsible for the difficult situation we find ourselves in. The Government ought to consider this situation and ask whether it is time to introduce some control over excessive borrowings by private corporations when those moneys are not being used for investment purposes but are being used for no other purposes than speculation and company takeovers. The CHAIRMAN —Order! The honourable member's time has expired. Mr COWAN(Lyne)(6.06) —Madam Chair, I thank you and the Minister for Immigration and Ethnic Affairs (Mr Hurford) for the opportunity to say a word or two in the debate on Appropriation Bill (No. 1) 1985-86. I want to deal with the community employment program and also the possibility of extra employment for youth. I would like to answer the previous speaker, the honourable member for Calwell (Dr Theophanous), and say that in Australia today we have the opportunity for full employment. If the management of the economy is correct-I do not wish to criticise that-the opportunity must surely be here to achieve that. I think that private enterprise generally will be able to employ more people if it can see profits available to it and if it can see the opportunity to expand. I think most of the profits today, which we read about in the daily Press, are made by the bigger industries and bigger organisations in Australia. Those many smaller ones, which employ 50 to 100 people and less, are the ones which will employ the extra people and we must allow them to expand within the community. I was rather concerned to read an editorial in the Australian of, I think, 8 October which instanced that many fruit and vegetable growers in the Riverina and other parts of Australia were unable to get labour to pick their crops. I know this has occurred previously. The other day a constituent in my electorate approached me to say that he was unable to get floor layers for his business. He wanted a specially trained person to do this and he asked me to approach the Minister for Immigration to see whether there was any possibility of being able to get trained personnel from other parts of the world, but this request has been refused. I emphasise that some of the problems that exist in certain employment fields today within Australia could be paid a little more attention. I know that people who are unemployed usually do not want to go out of their district to work, but maybe some single man or woman would be prepared to travel if a little pressure and incentive were there. The wages in the fruit and vegetable industry are very high at the moment. I think they provide a reasonable return, therefore, our problem today with youth unemployment may rest with the fact that we are still not training sufficient people in certain trades within our State technical colleges. I know that the Minister has a plan and I wish him all the best with it. I hope it is very successful. But we still come back to the problem, in this technical world of ours, of being able to say to young people that training and work are available if they want to take advantage of those opportunities. I am rather fearful that in today's atmosphere in Australia a lot of young people have reached the stage where they do not think it is possible to get employment. We must never promote that frame of mind, and I am sure that neither the Government, the Opposition nor industry promote it. I wonder whether the young people are taught at school that it will be hard to go out into the work force and get a job. That confidence must be instilled into the youth of Australia. It is our responsibility, with industry and commerce, to try to provide the work and the incentive to work, but we will still have to engender in young people's minds the idea that they have to face the challenge of trying to find a job. Maybe they will have to go to parts of Australia where they do not want to live, but the opportunity may be there for them to find a job. I am concerned about the community employment program. We accept that a lot of people are employed under it, but I would like to see approved some programs that deal more with community projects. I am talking about country showgrounds and halls and other projects where some benefit is gained for the social and general life of the community by the provision of more funding for that type of work. I do not want to be critical about it, but occasionally I see grants made to the community for projects for which we see no results; nothing productive comes from them. If taxpayers' money is to be spent, it should be directed towards this type of program. In the 1986-87 financial year I hope that the legislation will cover many more practical jobs under CEP, if it is to be continued. I conclude by saying that I believe that administration should be decentralised. In saying that I mean that if a businessman or farmer in the community can employ a person and taxpayers' money is available in the form of assistance, why not subsidise the wages for that person by the amount of the unemployment benefit? In other words, if a retired person, a pensioner or a farmer wants a fence built or clearing done or manual work of some kind, a person could be employed to do that work for a month, two months or longer. Most people want to work. Is it not better, when there is unemployment in the community, to give employers a certain amount of money if they employ a person for a certain period? By doing this we could decentralise administration. It could be done through the Commonwealth Employment Service offices by way of registration and I believe that it would help to reduce unemployment. My electorate is on the north coast of New South Wales. I worry tremendously not only about the youth in the community but also about the adults of 45, 50 and 55 who feel that it is futile to try to get jobs. If people will go to live in these good geographical areas of Australia, we may be able to help them find jobs. I thank the Committee for the opportunity of making these comments. Mr WILLIS(Gellibrand-Minister for Employment and Industrial Relations)(6.15) —I wish to say a few things about the points raised by honourable members in this debate, and I thank them for their contributions to the debate. It is inevitable in a discussion on employment that people will say that it is not good enough; that we should have more employment and less unemployment. However, it should be said that Australia's record of employment growth in the past couple of years has been exceptional by national and international standards. Certainly this Government has nothing to be ashamed of in terms of its employment performance in this country. We have seen a tremendous turnaround from the situation we inherited when we came to office. This Government inherited 10.2 per cent unemployment and an economy that was going downhill fast. In the 12 months prior to this Government coming to office there was an absolute loss in employment of 180,000 jobs and unemployment increased by a quarter of a million. That situation has been turned around so dramatically that Australia now has the fastest growing economy in the Western world. We are creating employment faster than any other country in the industrialised Western world. We are now performing so well that other countries are looking to Australia, talking about the Australian model and wondering about the secret of our success. It is simple. The secret of our success has been that we have applied the policies we said we would when we were in opposition. Those policies are based on the absolute priority and essentiality of providing employment. They have been achieved by pursuing an expansionary budgetary policy and a wages policy which has been concerned to ensure that we did not have a blow-out of wages and inflation as a result of that expansionary budgetary policy, as has so often been the case in the past. If one looks at the record of this Government, one must say that the employment growth has been extraordinary-far beyond the expectations of most people. There has been an increase in employment of 487,000 since April 1983, compared with 340,000 in the seven years of the previous Government. I stress that approximately 70 per cent of those jobs have been full time jobs. Indeed, in the last financial year 75 per cent of the job growth has been in full time jobs. Importantly, in view of the fact that it is sometimes raised by honourable members opposite, most of this job growth has been in the private sector. It is simply not true, as is sometimes alleged, that most of the job growth is occurring through Government subsidies or Government expenditures. We are creating most of the jobs in the private sector. Seventy per cent of jobs created have been in the private sector. In the last two years, 75 per cent of jobs created have been in the private sector, and in the last 12 months, 86 per cent of growth in employment has been in the private sector. As the recovery goes on, a higher and higher proportion of the jobs are being created in the private sector. That is because with the strengthening of the economy there is a greater capacity for employers to take on labour. The basic conditions are there for increased employment. There has been a considerable reduction in the real level of unit labour costs. Profitability in industry has increased, so it is now more profitable to be in business and therefore there is more incentive to take on employees. Our international competitiveness has increased considerably and there is a higher level of demand. For all those reasons there is understandably a strong growth in employment. The Organisation for Economic Co-operation and Development has predicted that employment growth in Australia will be 2.75 per cent for the calendar year 1985, as against 1.25 per cent for the whole of the OECD countries. For 1986 it expects a 2 per cent growth for Australia, compared with one per cent for the whole of the OECD countries. Employment in Australia is expected to increase at double or more than double the rate of growth of the rest of the industrialised world. It is not credible for people to stand up, in those circumstances, and say that we are not doing a good enough job; that unemployment is too high. We do not deny that it is too high at 8 per cent, but it is certainly a lot better than 10 per cent plus, as it was when we came into office. If we can continue these policies, as we strongly expect we will, and they continue to be successful, we will certainly see further reductions in the level of unemployment at a time when many countries are finding it impossible to reduce unemployment and unemployment levels are continuing to increase. The Opposition spokesman on industrial relations has said in this debate that the Government has bargained away for nothing the prospects of capitalising on the devaluation and so keeping economic growth going. Clearly, that is not what the OECD expects, because it is forecasting strong economic growth for Australia and strong employment growth. So, the Opposition is out of kilter with the OECD forecasters but it is also out of step with reality, because the reality is that we have achieved an arrangement with the ACTU in which we have very much established the basis for capitalising on that devaluation. We have an agreed 2 per cent discount off the national wage case in April of next year and that, in association with the postponement and the very prolonged implementation of any productivity case outcome, will mean that we are able to fully accommodate, through our wages policy, the impact of inflation, and to ensure that the inflationary impact from devaluation does not get built into our system and that it is able to be removed from the system and that by 1987-88 we shall be back to 5 per cent inflation. So in those circumstances there is, again, no reason to believe that we cannot maintain strong economic and employment growth. Of course, we already have the unemployment rate down to 8.1 per cent-the lowest rate for three years-and with the forecast increases in employment which we expect and which the OECD expects, that rate will continue to decline, even though from time to time there will probably be some momentary increase in it through variations in the work force participation rate. In this debate there has also been some discussion about the youth labour market and the fact that we still have a high level of youth unemployment. Certainly we have a high level of youth unemployment. At 21.6 per cent for teenagers that rate is disturbingly high; but it is much less than the 28 per cent that it was when we came to office. Although it has dropped considerably, we would be the first to agree that it needs to be reduced to much lower levels before anyone could feel reasonably satisfied. However, let me say firstly that, quite clearly, the policies that we have been pursuing have enabled us to have a considerable expansion of youth employment. For a very long time in this country, and certainly through the period of the previous Government, we have been experiencing reducing youth employment. Indeed, it goes back into the late 1960s that the downturn in employment for youth began, and it continued right up until the last couple of years. During the seven-year period of the previous Government, teenage employment declined by 31,000. Since we have been in office, we have seen teenage employment increase by 38,000. That is a 6 per cent increase over the past two years. It is a substantial turnaround from the trend that we inherited. Looking at youth on a wider scale-that is, those aged 15 to 24-it can be seen that we have had growth in employment for youth of 83,000 in the last two years. So there has been a considerable growth of youth employment. It is quite misleading to suggest that we are unable to create jobs for young people. We have done so. But given the enormity of the problem that we inherited, we still have that unemployment rate at a level which is far too high. The Government is not simply relying on continued economic growth and associated employment growth to bring down those youth unemployment levels. We have introduced, in particular, the traineeship scheme to try to ensure that we have a much more rapid impact, particularly at the level of teenagers and young teenagers, who are people who often have extremely severe problems in the employment area when they leave school before year 12 and go into the work force with no vocational or educational skills and, therefore, are not particularly attractive to employers, and they suffer from periodic bouts of unemployment, and may spend the rest of their lives going through bad employment performance unless something is done to assist them. We believe that it is very important-and the various reports that we have commissioned have said that it is important-to give young people more vocational skills. If they are leaving school early and not going into some form of structured training or on to some other form of professional qualifications they need to have a form of structured training. That is what the system of traineeships is designed for-to provide a system of structured training for the vast bulk of school leavers who leave school before year 12, and there are about 100,000 of them every year who do not go on to be an apprentice or do not go on to some other form of education but go into the labour market and suffer, in many cases, severe unemployment problems. It has been said by the report of the Kirby Committee of Inquiry into Labour Market Programs and by the OECD review of youth policy that a major step in correcting that is to give young people vocational skills. The traineeship scheme which we are now introducing will do a great deal to assist in providing those skills to young people. It will be a revolution, a very substantial transformation in the whole process of young people moving from school to work. We have already announced the first traineeships, which are with the Ansett company. We expect to announce many thousands more in the course of this year and, in the course of the next few years, to take the annual level of traineeships up to some 75,000. It has been said in this debate by the Opposition spokesman on industrial relations that the fact that the wage being set for trainees was less than the full award rate indicated that the Government acknowledged that youth wages were too high. That is an absolute misconception or deception, depending on which way one interprets the motives of the person who said it. The reality of the situation is that the trainee wage we are setting is certainly less than the award rate, because in most cases the wage reflects that the fact that there is less than a full week's work being performed by the trainee; that is, the trainee, over the course of the year, will be on the job for only 75 per cent of the time, since the traineeship consists of employment on the job, training on the job and training off the job, and for the time off the job there will be no payment. That means that the wage set must take account of that fact and, therefore, one starts off at 75 per cent of the award rate. There can be also, under the criteria that we have established, a further reduction to account for the fact that there is considerably enhanced training on the job by the employer. That means additional cost to the employer and loss of productivity to the employer. Therefore, it is not unreasonable to say that in that situation, in which there is a considerably increased amount of training on the job as compared with what previously existed before traineeships were introduced, there should be some further reduction in the wage to take account of that. That is quite a different situation from saying that because one has less than the full award rate applying to traineeships we are acknowledging that youth wages across the board are too high and should all be reduced, because we are talking about a separate situation-a training situation, not an employment situation. Traineeships are about training, and training on and off the job. The wage which is set for that reflects the special circumstances of the fact that that training is occurring in a structured way and it is not normal productive employment in the sense that young people are hired at present without the structured traineeships being in existence. So, it is misleading and totally incorrect for the Opposition to claim that the introduction of trainee wages at less than full award rate indicates an acceptance on our part that junior wages across the board are too high. We remain very confident that the policies that we have been pursuing will continue to produce strong employment growth in this country. They are a tremendous turnaround from what we inherited. I am sure that the people of Australia recognise that, and I am sure that all honourable members, including those on the Opposition benches, recognise in their hearts that what has happened on the employment front has been remarkable. I only wish the Opposition members could have been anywhere near as good when they were in office. Proposed expenditures agreed to. Sitting suspended from 6.30 to 8 p.m. Attorney-General's Department Proposed expenditure, $217,792,000. Mr SPENDER(North Sydney)(8.00) —In the meagre 10 minutes allotted to each speaker I wish to address two matters: First, the Australian Constitutional Convention and constitutional change and, secondly, the question of access to the courts and legal aid. On page 30 of the explanatory notes for the estimates of the Attorney-General's Department an amount of $200,000 is set aside for 1985-86. It appears that provision has been made for the holding of a plenary session of the Convention scheduled for the second half of 1985. Presumably, that is the purpose of the item. We are aware from what we have read in the Press that the Attorney-General (Mr Lionel Bowen) has some proposals for what has been quoted to be a `radically revised Constitution'. I think that quotation appeared in the Sydney Morning Herald of 1 October. One question I ask the Attorney-General is: What effect will his constitutional proposals-that is, effectively to have a constitutional commission-have on the Constitutional Convention? The Attorney will recall that at the last meeting of the Constitutional Convention a motion was moved by Mr Fordham, the Deputy Premier of Victoria, and seconded by Mr Neil Brown which dealt with the future of the Australian Constitutional Convention and, amongst other things, said that an Australian Constitutional Convention should be constituted and provision made for the ongoing work of that Convention. The Council is set down to continue its work and the question is: In view of the announcement that has been made in relation to the Attorney-General's proposal to have a constitutional commission, what will be the role of the Convention? Will the Convention have any role at all? Will the Council have any role at all or is it to be rolled up? I would be glad if the Attorney would tell us what the role is to be and, if it is to have a role, how it is going to work with the commission which he proposes. As for the proposed commission, I should be glad if the Attorney would tell us how far its work has been advanced and what its composition is to be. It has been reported that persons who are being considered for the commission include the author, Mr Thomas Keneally, the media personality, Mr Ray Martin, and the singer Mr Peter Garrett. I do not question the accomplishments of these people in their own fields. However, I ask: What is their individual or collective suitability or usefulness for the purposes of a commission whose job it is, as I understand it, to examine the Constitution? What instructions does the Attorney-General propose to give this commission about the constitutional changes he has in mind? What constitutional changes does he have in mind? Does he propose major shifts of power between the States and the Federal Government? Does he propose that there should be a major grab or grant of power by or to the Federal Government? When he looks to his commission, how does he see it working? People can be extremely skilled in their own areas, but when they are asked to look at questions of constitutional reform it is a job like any other and it is a job that requires skills. It is an intricate and difficult task which requires that one understand the Constitution-that one understands something about the history of the Constitution, how it is interpreted and how laws are interpreted-so that one has an understanding of what one is to put in its place. On 1 October the Sydney Morning Herald reported the Attorney-General as saying-I do not know whether it is correct-that he wants to have a brand-new document. In an earlier edition of the Sydney Morning Herald, on 4 March 1985, he was reported as making some general comments about what he wants to see a rewritten Constitution covering. One of the comments that is either made of him or attributed to him-I do not for a moment say that the quotation is necessarily a correct quotation-concerns wage rates and ways to control inflation. Does that mean that power is to be transferred to the Commonwealth for that purpose? The Attorney-General is reported as saying or has attributed to him the view that section 92 of the Constitution causes problems when States try to establish regulations to control marketing. For many years section 92 has been a barrier against State control or marketing exercises and enterprises and a barrier that has prevented the Commonwealth from controlling interstate trade. Section 92 was put into our Constitution to prevent controls over interstate trade so that we should be one country, and I understand from the Attorney's remarks that he is concerned that we should be one country. In that event, what does he intend to do about section 92? Does he intend to get rid of it? Does he intend to qualify it? Does he believe that it should apply to the Commonwealth? Does he believe that States should have the power to establish regulations to control marketing within the various States? If that is what he intends, he is taking us back to the situation that existed before Federation. In short, therefore, what are the Attorney-General's intentions? What are the areas within the Constitution that he believes require change? What are the directions that he wants to see constitutional change take? What are the specific proposals that he would have Australians make for 1988? If we are to have a constitutional commission, if we are to have a Constitutional Convention, the Attorney-General must, as the Attorney-General of this country, tell us clearly what he expects that commission or Convention to achieve. If we do not have leadership by him or clear directions from him, we do not understand where we are meant to be going and, more than that, the Australian people as a whole are not being told where he wants to go. If we are to have a brand-new Constitution-I must say that I see no reason at all for a brand-new Constitution without for a moment saying that the present Constitution is perfect-I should like the Attorney to tell us what that brand-new Constitution is to involve. I turn to the second subject I want to address-legal aid and access to the courts. I am sure that the Attorney-General would agree with me when I say that access to the courts is fundamental. We can have the best of legal systems and reform the laws as best we can, but if ordinary Australians do not have access to the courts because the costs deny them the price of entry, the system fails. I see on page 78 of the explanatory notes for the appropriations of the Attorney-General's Department that there is to be a cut of some $5m. I am not quite sure how that is made up or the purposes for it. It may well be that this amount has been taken up in some other way. However, I should be glad if the Attorney would explain that item to me. In saying that, I realise that overall there is to be a major increase in the funding for legal aid. At the same time, I would like the Attorney-General to express a view as to the role and utility of the private profession and to contrast it in his opinion with the role of salaried counsel within the legal aid organisations. I am not particularly going in to bat for the private professions, but one needs to try to have an assessment-I am sure that the Attorney-General tries to make such an assessment-of the benefits one can get from employing those working in-house, outside counsel and outside solicitors. I would be glad if he could tell us the availability of legal aid in cases where there are prosecutions for breaches of Commonwealth laws. Can he give us figures for the last 12 months or so, perhaps the last financial year, on the number of applications made and the number of applications rejected? Lastly, can he give us some indication of the Government's reaction to the final report of the legal aid task force, to the recommendations contained in that report and to the way in which he sees the legal aid processes of this country developing over the next five to 10 years? I choose five to 10 years because, if one is going to plan ahead for legal aid, it is wise to plan beyond the next month, the next 12 months or the next 24 months. Mr MAHER(Lowe)(8.10) —Some years ago when we were in opposition I heard Mr Justice Staples criticise the proliferation of organisations within the Attorney-General's portfolio which in his view at that time wasted and dissipated the money available for legal aid. He named organisations such as the Institute of Family Studies, the Human Rights Commission, the Australian Institute of Criminology, the Law Reform Commission, et cetera, not particularly denigrating any of these individual groups but saying that there is a limited pool of funds for legal aid available to Australians and that the more these organisations proliferate the less there is for legal aid. He talked about the fact that, if there is an institute or a commission, it has to be serviced with cars, with libraries and with pot plants. Here tonight in the estimates for the Attorney-General's Department I notice an allowance of $33,000 for indoor plant hire for the Office of the Director of Public Prosecutions. I feel that perhaps Jim Staples was right-there is evidence in this breakdown and, therefore, a reduction in the amount of money available for legal aid because of these organisations. All members of parliament, I am sure, are confronted by constituents who cannot obtain legal aid, the most common type of situation being a matrimonial cause or family law case when a woman is denied legal aid in respect of property settlement after her husband leaves her. But other groups come forward and complain to members about legal aid. I pay tribute to the work of the Australian Legal Aid Office. I know that the Attorney-General (Mr Lionel Bowen) has been fortunate in gaining an enormous increase in the amount of funds available for legal aid, but it is an area where, I assume, there will never be enough money to satisfy all the claimants. I pay tribute to the work of the Australian Legal Aid Office staff. I refer many cases to the Legal Aid Office from my electorate office. I find the staff there to be very skilled, to be possessed of a great deal of expertise, and creativity for that matter, in dealing with constituents who sometimes are very upset and annoyed, and to be very tolerant. Tonight, however, we are dealing with the estimates for the whole of the Attorney-General's Department, with an expenditure of $217m. I note that in the case of the Law Reform Commission there is expenditure of $2.5m, but nearly half a million, or $400,000, of that goes towards office rent. While I do not believe that any organisation should operate from second-rate accommodation, I feel that there is a great argument for more government office buildings when one finds that such a large proportion of the expenditure on an important group such as the Law Reform Commission goes on rent. As I have said before, I notice that through the Department there appears to be a need for more co-ordination of law libraries. There is this notion that each group should be at arm's length from the others. Nevertheless, members share a library with another place, the Senate. Why cannot these legal departments, offices, commissions, councils and institutes share libraries? Why do they need the expensive duplication of law reports with separate cataloguing and separate personnel running libraries? I feel that there needs to be, in the fullness of time, greater co-ordination of libraries and, therefore, an enormous saving of funds to the taxpayers. I know that the Attorney will get around to this, as will those who administer his Department. Every department, every institute and every organisation has great amounts of money expended on libraries. I said that in opposition and I say it in government. I am looking forward to action by the Government in the area of spent convictions. I believe that this may come in under privacy legislation. I have raised previously in the House the need to do something about the privacy of an individual who has a Commonwealth conviction in his or her past and who has to reveal it. People have come to me who are ashamed of something that happened years ago. They might now be honoured and respected citizens, but whenever they apply for a licence of some sort or fill out an application form they have to state a conviction in their past. This is a difficult problem. It has been discussed for many years and has been the subject of Law Reform Commission reports, but it has never really been grappled with. I know that this Attorney, who is noted for his compassion for people with problems, will see the importance of this area, particularly where the conviction was for a minor matter. Another area that I have touched on before is the reform of our prisons. I refer to the need for conjugal visits for people sentenced to prison for Commonwealth crimes. In Central America last year when I was visiting prisons there as a member of an Australian parliamentary delegation I found that prison officials were appalled that there were no conjugal visits in this country. The whole notion is just too difficult to deal with here, but the debate on accquired immune deficiency syndrome-AIDS-has highlighted the incidence of homosexuality in goals and the great problem of homosexual rape of prisoners. There is a need to maintain a prisoner's marriage and to strengthen the institute of marriage, and there should be no bias against heterosexual relationships being maintained in prison. I commend the Attorney, the Institute of Family Studies and other groups within this Department to investigate the need to strengthen the institution of marriage where one partner is in custody. It has been overcome in California where there has been legislation in this respect for many years. I know that all sorts of incidents and problems might arise, say, in respect of someone convicted of bigamy and sent to gaol, but I do not think this problem should be kept in the too-hard basket. I commend this matter to the Attorney and I know that he will look at it. Another point I want to touch in is the development within the Office of the Director of Public Prosecutions. The full time staff there has gone to 337, with estimated expenditure of $10.9m. This is an extremely important department and is doing very important work following on from the Costigan Royal Commission into the Activities of the Federated Ship Painters and Dockers Union-work that has really uncovered the depth of organised crime in this country and has shown the links between crime, tax avoidance, drugs and many other areas. I know many of the personnel in that office and I know how dedicated and impartial they are. I feel that the Attorney, in establishing this Office, has restored to the Attorney-General's Department much of the self-esteem and self-confidence that went out of the window at the time of the bottom of the harbour scandals and the revelations concerning the Commonwealth Deputy Crown Solicitor's Office in Perth. I know many people in the Sydney Commonwealth Crown Solicitor's Office. I know that they were very embarrassed at the time; they felt that no one was speaking up for their work and for the high standards, the skills and the expertise they had developed in many areas. I feed now that the past is forgotten and that people in the Department have regained their traditions. I congratulate the Attorney and his predecessor for having restored the role of the Crown Solicitor's Office and its officers and for having raised the general level of the Attorney-General's Department. I commend the estimates to the Committee. Mr WEBSTER(Macquarie)(8.20) —There is one issue I wish to take up concerning the estimates for the Attorney-General's Department. It concerns the estimate of $5.6m in 1985-86 for the operation of the Human Rights Commission. The Commission was established under the Human Rights Commission Act of 1981. As pointed out in the Budget statements for 1985-86, co-operative arrangements with the Commonwealth and the States of New South Wales, Victoria and South Australia on human rights matters provide for a one-stop system for handling complaints under the human rights and sex discrimination legislation. I am deeply concerned about this $5.6m allocation to the Commission because I believe that enough evidence exists to support the belief that it has departed considerably from what it was originally set up to do. It has exceeded its brief. It is overwhelmingly obvious that the majority of Australians do not want many of the things that are being pushed in the Commission's barrow. The Commission seems bent on attacking the traditional Australian family and our way of life. This is clearly illustrated in the book, bearing the Commission's imprimatur, `Teaching for Human Rights' by Ralph Pettman. On page 152 it states: In Australia-a liberal, capitalist, multicultural democracy with social welfare proclivities, a highly stratified class structure, a value system that is secular, racist, sexist and materialist-the family reflects and promotes this fact. That is an emotionally exaggerated definition. The next few paragraphs go on to indicate that to promote the traditional family is to take a totalitiarian approach and that other group units, no doubt including homosexual groups, are `to be given a fair go, and that governments are obliged to acknowledge and allow for this fact. This is a clear attack on the Australian family. The same book, written for the Commission, makes a strong attack on Australia's allies, such as the United States and others, when it states on page 66: There has been mass assassination too, by more covert and indirect means. The construction of a capitalistic world economy, predicated upon dishonesty and agreed, has slaughtered uncounted millions the world over through the exploitation and misdevelopment of global resources. The United States and other erstwhile `free market' democracies have much to answer for in this regard. I believe that that kind of statement far exceeds the Commission's brief. It has already been mentioned in this House by the honourable member for Parkes (Mr Cobb) that the Commission has clearly assumed powers way beyond its role. Here are a few examples which have taken place in 1985 and one which will occur if present Bills before the House gain assent. Firstly, the Commission has advocated that we should allow homosexual immigration on the grounds of family reunion and it has come down strongly against anyone who is critical of the homosexual community. The last thing most people want is more homosexuals and more cases of acquired immune deficiency syndrome coming into this country. Secondly, the Commission has recommended that any illegal immigrant couple who have a child in Australia be entitled to permanent residence in Australia. This is an invitation to circumvent the law by fecundity. As the honourable member for Parkes also mentioned in his speech, Ronald Biggs managed to evade extradition from Brazil by fathering a child there. The third departure from the Commission's brief occurred when it urged Federal Parliament to override the Queensland parliamentary laws relating to Aborigines on State reserves on grounds, for example, that they may well want to have arrangements for self-government which differ from those of the community generally. Fourthly, the Commission wants boys and girls under 12 years of age to compete against each other equally in sporting events and it has been reluctant to revise this decision. The Executive Director of the Australian Primary Schools Sports Association has had to apply to the Human Rights Commission to be allowed to run the Association's national championships divided into boys and girls competitions. Fifthly, if the Bill of Rights is passed, the Human Rights Commission would acquire alarming powers to investigate any action which it believes could have contravened that Bill. It could compel anyone to appear before its inquiries and produce any evidence or documents. The Commission could become Australia's star chamber, as has been mentioned on another occasion. Sixthly, Dr Moen, a lecturer in law at Sydney University, has said that a study he has done on affirmative action and equal employment opportunity policies had been suppressed by the Human Rights Commission because it was critical of the Commission's policies in Australia. Dr Moen had argued, for example, that employment schemes should hire their workers on merit and not stipulate that so many women or so many Aborigines and so on should be hired for each job. The seventh point is that the Human Rights Commission caused the visiting Professor of Jurisprudence at Sydney University, Professor Lauchlan Chipman, to claim that the Commissioner was `guilty of the most serious violations of human rights because of its abandonment of the traditional concept of justice'. He also said that the Commission had become `a monument to injustice' and that anybody who expected justice from the Human Rights Commission was naive. The Human Rights Commission has actively promoted just about every trendy cause in the book, most of which can never be argued to be in the best interests of this magnificent, God-given country and its great people. I believe that these points clearly show that the Attorney-General's Department has overestimated this aspect of its Budget by $5.6m. In other words, the sooner we estimate the Human Rights Commission out of the Budget, the better it will be for all of us. Mr DUNCAN(Makin)(8.28) —I wish to spend the few moments available to me looking at what I perceive to be some of the problems that exist in relation to the Family Court of Australia. I hope to do so in a relatively non-partisan fashion. If I can avoid doing so I do not want to go into the moral and philosophical questions which underlie marriage and the dismantling of marriage in our society. Obviously one would need far more than 10 minutes to do such a thing. I do not want to discuss those well canvassed issues of the jurisdictional problems arising under our Constitution; nor do I want to deal with substantial legal matters such as matrimonial property, which has recently been the subject of a report, and various other substantive legal points. Rather, accepting the philosophy behind the existing Act, I want to deal with the question of how it can be developed to better meet the needs of those involved as efficiently as possible and at a minimum cost to the Government. The history of the Family Law Act is that it was a very pioneering piece of legislation which was passed in 1974 and came into effect in 1976. The climate in which it came into existence was one of a great deal of fear and concern. The doctrine of fault was being overturned and a no fault system, at least in relation to the primary question of the divorce itself, was being instituted. The traditional adversary process in the Supreme Court had been the order of the day for as long as Australia had been settled by Europeans. There was a need to establish a court which had a fairly formal structure so that property settlements particularly, which involved large amounts of money and Queen's Counsel and the like, could be dealt with by a fairly high powered tribunal. I believe that there was also a need in a few cases to have a court which basically had the trappings and form of the traditional higher courts so that in those instances where particularly difficult litigants were involved they would feel that a body with great weight and power was making decisions. However, I believe that since that time the environment in which the Family Court operates has changed quite dramatically. We now can look at the proceedings of the Family Court to see whether they cannot be affected in a more efficient fashion than has occurred to date. There is now a need for less formality in most cases, for less rigidity and for a form which allows a great deal more flexibility. Essentially, the Family Court deals with two situations-those involving fundamental and irreconcilable conflicts and those where conflict is at a minimum and can be quarantined. In rare cases, conflict does not exist at all at the Family Court level. It is interesting to note that 10 per cent of cases now require a hearing; in other words, 90 per cent of the cases that come before the Family Court are settled without an adversary court proceeding. Further, although the number of applications has been stable at around 40,000 per year since 1977, the cost of the administration of the Family Law Act has gone up astronomically over that period. Cost escalations have occurred notwithstanding the trend towards applicants conducting their own divorce proceedings. For example, to illustrate that point, I mention to the Committee that in 1983 one-third of all applicants conducted their own proceedings, as against 28.6 per cent the year before. Those are the latest figures that I could find, but they certainly illustrate the fact that more and more people are conducting their own proceedings before the Family Court. Interestingly, in Western Australia, where the State Family Court exercises Federal jurisdiction, in 1983 half of the applicants conducted their own proceedings. Those figures tell us that in 90 per cent of cases, a less formal, less structured proceeding could be used, leading to a more efficient, less coercive and cheaper system of family law in this country. What type of system should it be? It could possibly be a two-tiered system, involving an informal counselling and conciliation procedure, with some type of voluntary arbitration for the 90 per cent of the cases that do not appear to involve major conflict, and the more formal Family Court structure, which would deal with those difficult cases which would be referred to it when serious conflict was found to exist by the officers at the lower tier of the system. It is interesting to note that, as I recall it, the original proposals for the Family Court provided for a two-tiered system of justices-senior judges and more junior judges. Although we still have senior judges and other judges, I understand that the proceedings do not work as they were originally intended to with the two-tiered system, with the more senior judges dealing with the more complicated and difficult matters where conflict was involved and the ordinary judges dealing with the less complicated matters where less conflict was involved. I believe that the benefits of a two-tiered system would be great and the cost savings would be large. By quarantining the 10 per cent of most difficult cases so that they would be the only cases dealt with by judges, the number of judges needed in that jurisdiction could be reduced significantly. Apart from the savings in salaries and fixed costs that could be made through this reform, it would also involve drastic savings in the costs of security services now needed to protect Family Court judges. I understand that from 1 July of this year it is anticipated that the combined costs of the New South Wales Police and the Australian Federal Police involved in protecting Family Court judges could total more than $4m for the ensuing 12 months. Obviously, any reductions in the number of judges would save considerably on that amount. As well, the introduction of a less formal procedure for the 90 per cent of cases that do not end up in serious conflict could mean that more of them would be handled by the appellants without assistance from lawyers, and hence it would mean cost savings to them and to the system. Of course, in some States there is still a considerable number of cases in which legal aid is involved and, therefore, possibly quite a deal of savings could be made in relation to legal aid. If the less adversary process were to be adopted at the first tier of proceedings, it could be assumed that cases would begin and would conclude much more quickly, thus saving on administrative costs. I have mentioned these matters tonight because I believe that there are opportunities for considerable savings to the Government in the Family Court area. I believe that the system is not operating as effectively as it could. I use the world `effectively' carefully, because I do not want to give the impression that in this area of great trauma and great difficulty, which I am sure is recognised by everybody, I am simply seeking to apply mechanical cost saving measures. I am not suggesting that at all, but I think that there are steps that can be taken within the existing framework to ensure that the system works better from the point of view of the litigants, that it works in a more cost-effective way from the point of view of the Government and that, overall, we can have a much better system. It is nearly 10 years since the Family Court began operating. For those of us who can remember the system that operated prior to the new system it is fair to say that the new Family Court system has worked quite well. Mr Slipper —It has been a disaster. Mr DUNCAN —It has not been a disaster. The honourable member has obviously not had any experience of the system that prevailed prior to the introduction of the new Family Court system. Whilst the tragedy of judges and their wives being killed was not with us- Mr Slipper —That is where it is a disaster. Mr DUNCAN —It may well be a disaster, possibly, in relation to one person in one State who has disrupted the whole system. In my view the system in States apart from New South Wales has worked very well. Litigants have not been under the same sorts of pressures that they were under previously. For that reason I think that by and large it has worked quite well. We are now at the stage when worthwhile reforms could be made, and I recommend the sorts of suggestions that I have made tonight to the Committee. Mr SLIPPER(Fisher)(8.38) —Tonight I am privileged to be able to address the Committee on matters relating to the Attorney-General's Department. The previous speaker, the honourable member for Makin (Mr Duncan), outlined certain aspects of the Family Court system, a system which, in my opinion and in the opinion of most people in Australia, has been an unmitigated disaster. Since 1976 we have had a court which purported to provide a system where there was no fault, where there was understanding, where there was compassion and where, in fact, litigants would have a fair go. As a lawyer, I know that there is absolutely no respect whatsoever for the Family Court. Litigants feel cheated. Lawyers know that the Family Court does not give the people of Australia a fair go. In fact, there can be no respect for any court system unless it is prepared to adhere to the principles which we have inherited from British law. I do not under any circumstances condone violence. The fact that judges are in fear of their lives and that their families are subjected to the outrageous violence that we have seen is an indication that some people are simply not prepared to accept a court which has such a pathetic record as the Family Court of Australia has. One of our greatest jurists, the Rt Hon. Sir Harry Gibbs, Chief Justice of the High Court, in his recent address to the Australasian Legal Convention, referred to problems relating to the Family Court. He mentioned that there was some difficulty in attracting to that Court judges of appropriate calibre. Of course, he was not impugning the honesty or decency of judges on the Court but he pointed out the difficulties which people were experiencing with this Court, with the judges and also with the limited jurisdiction faced by this Court. I believe that this is a bipartisan matter and I know that the Attorney-General (Mr Lionel Bowen), who is at the table, is concerned, as indeed are most Australians, about the Family Court and the way in which it has failed the aspirations of those who conceived its existence. I also wish to address myself to the matters relating to the most useless left wing and biased commission in existence in this country today, which has the temerity to make a claim for government funds in the appropriations. Of course, I refer to the Human Rights Commission whose irrational approach to subjects it has studied has shocked in many cases even the most left wing of its supporters. I was amazed to notice on page 24 of the 1985-86 Budget Paper No. 6 that $5,616,000 has been allocated to its budget. Mr Lloyd —How much? Mr SLIPPER —The figure is $5,616,000. I oppose this appropriation and state unequivocally that, in my opinion, this is $5,616,000 too much to spend on this ideological indulgence. Mr Nehl —Hear, hear! Mr SLIPPER —I thank the honourable member for Cowper for his support. I am ashamed to admit that the Fraser Government, no doubt surrendering to Liberal trendies, saw fit to establish this monster which has continued to devour public funds at an unprecedented rate. Mr Nehl —It was a mistake. Mr SLIPPER —It was a mistake; it was a tragedy. The nonsense that this Commission continues to utter is beyond belief. A recent report published in August 1985 compelled even the Labor Attorney-General to disagree with its findings. In this country it is important to emphasise the role of the individual. But, sadly, in recent years the role of government has grown to an extent that, under this Government, bureaucracy has blown out, gobbling up far too much of our national wealth. In addition, it is frightening but true that bureaucracy has now allocated to itself a function never before assumed. It now even presumes to dictate people's conduct and beliefs. It must be condemned absolutely for this. Under this Government, we see instrumentalities, departments and commissions grabbing a role falsely described as public education but which is in reality public propaganda. In many examples such as the Human Rights Commission, ideologically committed people take a biased view in areas of high contention. They proclaim it as some sort of truth and then promote it at the expense of the ordinary Australian as something which all people must believe and accept as gospel. The predictable Marxist beliefs of the Commission are rejected by all Australians. The Human Rights Commission is a non-elected body, a law unto itself. It has decided, in the area of human rights, to determine beliefs that are acceptable and which should be encouraged and those that are unacceptable and which should be proscribed. Mr Webster —It should be disbanded. Mr SLIPPER —It should be disbanded, as the honourable member mentions to me. The late Senator Joe McCarthy of the United States Senate would be proud of the Human Rights Commission and its attempts to control the minds of Australians. Under a coalition government, it should be abolished forthwith. I was heartened to hear that the Deputy Leader of the Opposition, the honourable member for Menzies (Mr N. A. Brown), speaking in Brisbane, recently described its future as bleak. Let us look at some of the arrogant claptrap regurgitated by the Human Rights Commission and its socialist staff. Mr Webster —It is sickening. Mr SLIPPER —I agree absolutely. It recently produced a book called Teaching Human Rights-Activities for Schools. This has become one of the prime weapons of the Commission in its attempts to indoctrinate the public. Let us all note that this book was published for the Human Rights Commission and copyright is in the Commonwealth of Australia. This means that the ordinary taxpayer will foot the bill. Mr Nehl —Disgraceful. Mr SLIPPER —It is indeed disgraceful. The subject of `life' is included in the book which contains as an absolute truth this statement: The construction of a capitalist world economy, predicated upon scarcity and greed has slaughtered uncounted millions the world over through the exploitation and mass development of global resources. The United States and other erstwhile `free market' democracies have much to answer for in this regard. Imagine the taxpayers of Australia being forced to pay for a publication which would have pride of place on Karl Marx's shelf! What about the tens of millions of people murdered in Russia when the Bolsheviks imposed communism upon the people of that unhappy country? What about the people of Afghanistan now labouring under Russian oppression? As one can understand, these matters are conveniently overlooked by Dame Roma Mitchell and her cronies. The sooner the Human Rights Commission is given the chop, the better. Mr Maher —I take a point of order, Madam Chairman. I am very reluctant to interrupt the honourable member but, as I understand it, Dame Roma Mitchell is a judge and it is contrary to the Standing Orders to impugn in this House the character of a member of the judiciary. I am not sure whether she still is a judge but certainly she was a judge and may well still be one. The CHAIRMAN —I thank the honourable member for Lowe. I regret that at the time I was speaking to the Clerk. If the honourable member for Fisher did say anything that was outside the Standing Orders, I am sure he will withdraw it. Mr SLIPPER —My understanding is that Dame Roma Mitchell is no longer a judge. In any event, if she acts as though she is not a judge, she ought not to be treated as a judge. The sooner the Human Rights Commission is given the chop, the better. If the Attorney-General has the courage to take this step, everyone will applaud. But unfortunately, I doubt whether the Left in the Australian Labor Party will permit this expensive ideological indulgence to be put out of its misery. If Dame Roma Mitchell had any decency or honesty, she would resign forthwith. Mr Nehl —Hear, hear! Mr SLIPPER —I am pleased that the honourable member again agrees with me. The Human Rights Commission has now reached the stage where at public expense it promotes unacceptable philosophy and condemns free enterprise, trade, the development of resources and, of course, the United States of America. Let us look at another example. The Commission has produced a book dealing with the family and suggests that the family in this country emphasises that our country has a highly stratified class structure and a value system that is secular, racist, sexist and materialistic. The Human Rights Commission is endeavouring to undermine the very institutions of Australia. The Commission expects the people of Australia to fund its white-anting activities. It expects this Parliament to support it in its attempts to destroy this country's traditions. It expects us to prop up its attempts to indoctrinate Australians in a manner which would do Dr Goebbels justice. I am certain that this worthless Commission and its staff have another think coming. I am positive that the people of Australia will not tolerate this indoctrination by people who have no respect for our values. The people of Australia are absolutely opposed to any attempt to control their minds and actions in left wing ways. This Government stands condemned for endorsing the Human Rights Commission's demands to control the activities of citizens. This country will stand up and be counted by rejecting the Human Rights Commission. The CHAIRMAN —Order! The honourable member's time has expired. Mr WRIGHT(Capricornia)(8.48) —In the 10 minutes allocated to me in this debate, it is my intention to target my remarks specifically at an area that falls within the aspect of the responsibility of the Attorney-General (Mr Lionel Bowen) which relates to the Trade Practices Commission and consumer affairs protection aspects. At the outset, I wish to place on record my personal appreciation of the renewed and positive emphasis that the Attorney-General has given to consumer affairs in this nation and to commend him for the far-reaching and innovative changes that he is bringing about through the major amendments to the Trade Practices Act which he introduced into the House last week. One of these changes relates to the liability for loss or damage from breach of certain contracts. It introduces the pioneering and radical concept of making the credit supplier or provider also liable to the consumer if that consumer suffers loss or damage as a result of misrepresentation, breach of contract or failure of consideration in relation to a contract. This means that those banks, finance firms, credit unions and the like which make credit available too freely, and thus enable Australian consumers to be ripped off by the con merchants, the quick quid crooks and repayment rorts, will now be legally liable. Over the years, tens of thousands of Australian consumers have been caught by these corporate criminals who have preyed on the unsuspecting, who set up companies only to go out of business, taking with them millions of dollars in repayments. For far too long, these types of people have got away scot-free. While the amendments to the Trade Practices Act will greatly hamper the success of future rip-off schemes by removing the availability of easy credit, I believe an effort should be made to bring to justice those who have ripped-off the Australian public in the past. I am therefore calling for a select committee of inquiry into the failure of probably the most costly rort that has hit this country-I refer to the fitness and aerobic industry. Approximately one year ago, right across this nation, the fitness and aerobic industry went bust, taking with it millions of dollars of investments by small business proprietors who went into fitness centres and almost $15m from the tens of thousands of customers who joined those centres on pre-payment plans financed mainly by the ANZ Bank. Today, 12 months later, between 10,000 and 15,000 Australians are caught up in a situation where they are still being forced to pay for something that they never received or only partly benefited from. While the ANZ Bank at this time has agreed not to pursue any further action against the people in New South Wales who were caught up in the fitness industry collapse pending the outcome of a test case there, that bank is vigorously pursuing the other thousands of members of the Vigor and Inshape enterprises in Queensland, Victoria and Tasmania. I contend that the ultimate collapse of the Vigor and Inshape enterprises was planned and premeditated. It was skilfully orchestrated by a group of men who, in my opinion, should be behind bars. I refer to Richard Augustine McDonald, Brian McDonald, Barry McCowan and John Collins, associated with the companies Clinton Dale Pty Ltd, Macedraw Pty Ltd and Excidal Pty Ltd. The people behind these companies, particularly the four men named, I believe conspired to take the- Mr Spender —Mr Deputy Chairman, I take a point of order. It seems to me that some charges of a criminal nature are being made against individuals and organisations outside this chamber. It may not be entirely within the Standing Orders but there are some things that should be recognised and charges of criminality should not be made lightly in this chamber. The people who do it disgrace this chamber. Hence, Mr Deputy Chairman, I would ask you to rule the honourable member out of order. The DEPUTY CHAIRMAN(Mr Keogh) —Order! I am not aware of the actual matters to which the honourable member for North Sydney is referring. He may recognise the fact that I have just occupied the Chair. I will listen closely to the honourable member for Capricornia. Mr WRIGHT —The people behind these companies, particularly the four men named, I believe conspired to take the get fit enthusiasts for every cent they could and, with the help of the availability of easy credit through ANZ Bankcard, did just that. These men, with the help of others in various eastern States, masterminded a scheme which, from the very outset, was destined to fail-a scheme which would never have got off the ground had it not been for the part played by the ANZ Bank. (Quorum formed) The collapse of this scheme has left the viability and reputation of the fitness and aerobic industry in tatters. Clearly, there is a need for uniform State and Commonwealth legislation on franchises and there is a need to tighten the law relating to pre-payment contracts that exceed a 12-month period. This scheme was very simple. It was a rort pulled by McDonald and his cronies whereby they bought fitness centres well above the market price and, in so doing, gave people a $30,000 deposit. They promised to pay a lease over a few months. They did not complete the contract but, during that period, took something like $600,000 from some centres, up to $1.5m from other centres, pocketed the money and then closed down the centres. They did the same with franchises. They sold these franchises for $30,000 plus 5 per cent of gross turnover and another 10 per cent of gross turnover for advertising and promotion. The sort of money that was taken can be shown by the figures. In six centres-two in New South Wales, three in Queensland and one in Victoria-these people took out $1.5m in three months. For instance, in Preston they took out $204,327; in North Sydney, $232,435; and in Rockhampton, $224,425. These crooks-that is what they are, criminals-took out something like $15m from unsuspecting Australians right across the board. I suggest that there is a need for an inquiry. There ought to be an inquiry into the ANZ Bank's part in this matter as well because it was telling people that they would not have to pay interest. The bank was also giving credit to centres that actually were starting up after other centres in Victoria had failed. We also had a situation where there is no credit check on any of the people applying. There were instances where up to 100 people were given approval over the phone. The money was immediately paid to the Vigor organisations; yet the people heard nothing from the ANZ Bank for months and months. People were duped; they were told they could get out of their membership. In fact, they could not. It was a blatant lie. They were forced into loans. In a survey carried out throughout central Queensland and other parts of Queensland hundreds of people stated in writing that they were told by the Vigor centres that they had to use ANZ Bankcard. There are known instances where cash payments were refused. These people were also conned because they were told, for instance, that there would be no interest payments on any of the money that they would pay by way of this loan. Hundreds of people said that they went into this scheme only because ANZ was behind it. I believe that the Australian market-place has been a haven for con merchants for far too long. It is my hope that, given the establishment of a select committee of inquiry into the collapse of the fitness and aerobic industry in 1984, this Parliament can strike a blow for consumer justice that will be a warning and a deterrent to this nation's white collar criminals for decades to come. But we must start here. There must be an inquiry because it is quite obvious from the interjections from the honourable member for North Sydney and his colleagues that they will protect the white collar criminals of this nation. The DEPUTY CHAIRMAN —Order! The honourable member's time has expired. Mr LIONEL BOWEN(Kingsford-Smith-Attorney-General)(8.58) —I thank all honour- able members for their contribution. This has been a wide-ranging debate. People who practise the law have all sorts of cases put before them. I now realise, having listened to honour able members, that they all have particular matters that they want addressed. Let me commence where my distinguished colleague the honourable member for Capricornia (Mr Wright) just finished, that is, with the Trade Practices Act. I am very conscious of the fact that many honourable members have had complaints from consumers about matters relating to consumer protection. The honourable member for Capricornia, who is one of the leading representatives of the consumer movement in Queensland, has been very anxious to ensure that this piece of legislation protects consumers from fraud. I am very pleased to be able to say that in the present proposals, there is a protection for those who are deceived. That protection not only goes to those who might have been the originators of the perception but also extends liability to those who provide the credit. Some responsibilities are now being looked at in terms of that Act. I am sure that when that matter is considered by the Parliament the honourable member will be pleased with the result. There is not a great deal of time but I would like briefly to touch on other matters. The honourable member for Fisher (Mr Slipper) raised two issues. The first issue he raised related to family law and the problems faced by the courts. The honourable member for Fisher comes from Queensland. As far as my Department and I are aware, whilst there are always difficulties in family law-difficulties relating to the problems of people, the problems of custody and the problems of property-there is certainly no problem in the courts in Queensland. In fact, in terms of results it is one of the better managed jurisdictions without perhaps having the pressures of some of the other States. Whilst I can understand that the honourable gentleman feels that in his view there is a change in the law, because the fault has been taken out of the question of family law, it ought to be put on record that that piece of legislation was not passed on party lines. It crossed all party lines. Those of us who were here at the time will recall that many people had different points of view on the final piece of legislation. Many people did not like it but the majority did and those in the majority came from all sections of the Parliament. Although I find some of the problems of interest, I think the issue is that the pressures are great. Perhaps the court was set up in too much of a hurry in 1976. Perhaps there was not an adequate availability of suitable premises. I am not complaining, but I think that was a factor. I agree also when Sir Harry Gibbs says that some consideration ought to be given to personnel who take on the responsibility of family law. I must say that I find it difficult to attract people to go to the family law court because of the attitude adopted, probably very unfairly, that there is something wrong with the court. There is nothing wrong with the court but there can be a lot of difficulties with a court that deals with human behaviour when people are not prepared, to some extent, to accept the verdict of a judge when it comes particularly to custody and also when they disagree with issues of decision made in property settlements. Divorce means that the parents are going to separate and we have the inevitable tension, conflict and heat generated by the fact that each considers himself or herself not to be in the wrong, yet a judge has to make a decision. It is not an easy task. It has been very disappointing to find that violence has come about, particularly in the Sydney region. An enormous amount of resources and time is being devoted to protecting the judges in that area to detect those responsible for the murders of people and the attempted murders of others. It is a very serious problem. I have been talking to the judges and I find them very co-operative and understanding of the problems they face. I must say that they try very hard to get the message across that it is a court in which they want to assist people. As was said by some other speakers earlier, it is a court that was designed for compassion and conciliation but it is very difficult if at times that does not come through in the conduct of the court. Of course, there is also the inevitable problem of the disenchantment by litigants as to the result. I think it would be helpful if we could persuade the Parliament that perhaps we might have expected too much of judges who have no judicial responsibilities other than to sit in the Family Court of Australia every day. I do not think they need to be given other judicial work. I think it would break the monotony and help to assist the court. I do not think it is in our best interests to have an exclusive Family Court of Australia. I think it ought to be like any other court. I would be very anxious to upgrade the status of the judges to that of Federal judges, but there is a resistance to that on the basis that they may not be able to do all the work of Federal judges. I think I should be entitled to try and in future appointments there might be the opportunity to work in major areas. That would go very close to what the Chief Justice was on about. It is also important in appeal cases that there be judges of Federal Court status to talk about appeals and I think that would be accepted. Then we might break down the barrier that has been very unfairly created in the sense that the court has no real understanding of the problems of the family. What we are about, of course, when we talk about the responsibility of judicial office is the fact that a judgment has to be made and that very experienced people are there who can make those judgments. We cannot really solve the problems of a family that is torn apart by difficulties in its past with a legal result that it come back together. That would require other than a legal judgment. A judgment directing that the parties resume married life is of no consequence at all to them. They want to know what will be the result from the point of view of property or custody, and that requires the wisdom of Solomon. The issue is to get the parties to accept the fact that a judgment has to be made and that it is not one of revenge. It must be one of attempted apportionment, of where the future remnants of the family can continue to make their respective lives and particularly, as far as the children are concerned, to get the respect, love and affection of both parents. That would be a remarkable result. It has not always been possible to achieve that. Those of us who know the difficulties of the divorce court and the sadness and sorrow of children whose parents have separated understand that. The difficulty is that we find too much emphasis placed on what is wrong with the court. Let me give it high praise for the work it does. It performs very well. Ninety per cent of the cases are settled, which is a very remarkable effort for those assisting that court. I must say that the court, through the judges, the registrars and the officers of my Attorney- General's Department, and with my own interest, are working out ways and means whereby we might be able to streamline the procedures to try to prevent too much adversary combat. If the parties can come to a settlement on the matter we must encourage that. The registrars are playing a very good role in that area and I think we are beginning to see an improvement in not having too much red tape or too many difficulties in getting matters dealt with. But there are always those cases which will never be solved unless they go to court, and I am anxious to work in the area that will bring about a solution to those, I hope by melding that court into a Federal jurisdiction and not having it in such an exclusive jurisdiction. It will take a fair bit of advocacy on my part with those in the judiciary who feel there are problems in that area. I point to the issues: At present there are 60 uniformed New South Wales policemen in Sydney guarding the courts and judges. That is just an impossible continuous allocation of resources that has to be used and we have to find a solution to that. It is not in the interests of the judges, their safety and their families, and I can well understand why people could feel there is a real problem in being invited to sit on that court. I think we can get away from this if we can get into the areas I have mentioned; that is, not exclusive jurisdiction and not having the court identified as a special building. The honourable member for Fisher is not present, and I do not mind that, but he seemed to think that the setting up of the Human Rights Commission was solely my fault and that the people on it were solely appointed by me, whereas in fact it was created by the Fraser Government and all appointments were made by that Government. I think the honourable member might at least recognise that. Mr Peacock —I think he did say that actually. Mr LIONEL BOWEN —Did he? I accept the honourable member's views although I do not think he had the benefit of listening to him in here. Mr Peacock —I listened in my office; I listened to every word. Mr LIONEL BOWEN —There must have been some interception in the communications system because it did not come through here. I think the Commission is trying very hard in a very difficult area but at the same time we are dealing with the question of human rights. I do not agree with a number of its decisions, and I have said so, and the Government does not either. Nevertheless, from the point of view of dealing with the issue of human rights, the former Government created a commission, as it should have and as it was obliged to do as we sit on the Human Rights Commission in the United Nations. We endeavour to get the message through to all countries that people have rights and governments must recognise them. I know the Commission endeavours to do that in a wide-ranging area. It does it in the areas not only of Federal and State laws but also relating to the rights of people in terms of employment, where there may be racial or sexual discrimination. I am very hopeful that when the present Bill goes through the Parliament we will reconstitute the Human Rights Commission. I am anxious that the President of that Commission be a Federal judge and occupy the position for a limited period rather than permanently so that again there can be some understanding of the fact by a number of judges as to how the human rights legislation can work. I look forward to that as a challenge to the legal profession and I am sure that there will be recognition of the value of the International Covenant on Civil and Political Rights. We agreed that we would ratify that Covenant. The previous Government did that and we supported it. The means of ratification was to bring into existence the Human Rights Commission-we are now going to reconstitute that-as well as an Australian Bill of Rights, which is now before the Parliament and about which I will say no more. The honourable member for Makin (Mr Duncan) referred to the Family Court. He referred, quite properly, to the Western Australian situation, where parties are encouraged to settle their differences and to appear in person. I must say that it is one of the most successful Family Courts in Australia. Some 68 per cent of litigants appear in person and matters are frequently solved in pre-trial conferences. The parties are able to get some legal advice if they wish, but if matters can be solved without too much legal interference, better solutions obviously are achieved there. The honourable member mentioned problems of exclusivity of jurisdiction and difficulties with security, to which I have adverted. The Court is performing very well in South Australia. The additional provision for getting the parties together without too much legal involvement, with the registrars holding conferences, is now being used readily. The number of cases has been reduced because of this concept, which came into being only in July. Nevertheless, we want to overcome the problems I mentioned earlier which might be causing difficulties, problems such as the nature of the exclusive jurisdiction and the wrong impression that the Court is deemed to be inferior in terms of being able to judge as other courts do. That is not right. In that context I make the point that perhaps we can do better in making marriages more successful if we devote more resources to pre-marriage counselling guidance and education. The final position comes down to the parties themselves having an understanding, a compatibility and an appreciation of the pressures which arise in the married situation, particularly where children are involved. There are also difficulties caused by economic hardship, loss of employment and other pressures which can affect the family. If all those matters could be put into perspective properly prior to marriage, I am sure it would assist. Nevertheless, strong efforts are being made in the area of family law. The honourable member for Macquarie (Mr Webster) said that the Human Rights Commission must have been established by a Labor Government. I can understand the problems, but the Human Rights Commission does not produce reports because the Government requests it to do so. That is not necessarily so; in fact, it is usually to the contrary. It produces reports, as required by its charter, on questions such as illegal immigrants, Aborigines and homosexual reunions, but this Parliament makes the law and is guided by public opinion as to what is fair and reasonable. The Human Rights Commission has a charter to produce reports, and I remind the honourable gentleman that the Commission was established by the Fraser Government. That fact should be recognised in the debate here. Criticism was also made of reports being received in respect of affirmative action. That matter is being discussed, not from the point of view of any legislative requirement that it be made mandatory but from the point of view that people interested in giving women fair employment opportunities, as is their right, are talking with the business community and agreeing that there can be opportunities to consider equal opportunity or equity in employment. I think the business community is agreed that there are plenty of opportunities where it can indicate to its members that they should not overlook the fact that because an employee happens to be a woman she would not have the necessary skill and application for the job. The case is to the contrary, as we all know. When we look around, both in the Parliament and elsewhere, we see women in our society making a splendid contribution. What we are talking about in this area should not be criticised; it should be supported. Opportunities have to be given to women in employment be cause there is no doubt that they have been discriminated against in the past and that they deserve as much encouragement as anybody in our society. That is what the movement is all about and I think it will attract support across the length and breadth of the nation. When legislation is introduced, consideration should be given not to making affirmative action mandatory but to mentioning it if it is not being applied. The honourable member for Lowe (Mr Maher) effectively dealt with the issue of organised crime. He was the only honourable member to touch on that matter. It is a most serious issue, not only in our nation but throughout the world. Enormous resources have to be devoted to prosecuting criminals. The Director of Public Prosecutions carries out that role, and is very busy and successful in bringing criminals to trial. It takes a long time and a fair amount of effort to get the necessary evidence. The National Crime Authority has worked effectively in creating task forces of lawyers and others who have skills relating to monetary transactions and can chase what Mr Costigan called the money trail. Together with the Taxation Office, they have been able to collate information that will lead to substantial benefits for the Australian community. There is no doubt that the amount of money involved runs into millions of dollars. The intelligence behind these organisations is not limited to Australia; it is international. It involves organisations such as the Mafia and others whose penetration is improving, regrettably, in all nations of the world. The recent conference in Milan, dealing with organised crime, identified these problems in every nation of the world. It was realised that the narcotics trade particularly is increasing and that young victims are deliberately being addicted to drugs by those involved in the organisations. They become a problem not only to themselves but to society because their drug addition leads to other crime in trying to service that addiction. There needs to be co-operation by means of mutual assistance treaties, which will provide the opportunity for a country to ask for information which might be available in the financial area. Information could be given and received to help in dealing with organised crime. The questions of taking evidence overseas and the forfeiture of assets are also important. In other words, there has to be a massive attack in this area. I welcome the support of the State governments, but it is a major issue facing all nations of the world. Mr Sinclair —Will you find Trimbole? Mr LIONEL BOWEN —We are having a lot of difficulty, for reasons that the right honourable member might understand. The amount of money involved would run into millions of dollars. The right honourable gentleman mentioned a person's name. As a matter of interest, in the case in Ireland he was defended by three Queen's Counsel and two juniors, which would have cost a little bit of money. It has been suggested that assets might have been available in a neutral country, famous for that, running into substantial sums of money. It might interest the right honourable member to know that when this person left Australia on a false passport, it was thought that he also knew the countries with which we had no extradition treaties. His legal intelligence is pretty good. I am happy to say that I have completed another eight extradition treaties, so that we shall be able to deal with these matters, and there are many more to go. It is difficult to get the countries of the world to move quickly, but it is because we have altered the techniques, agreeing with the question of a statement of the offence as being reasonable in the evidence submitted, that I think we were able to get a lot of movement there at present. I thank the honourable member for Lowe for raising this most important matter. It will take a lot of the time of this country's legal and other resources to deal with these matters. The Australian Taxation Office has a role to play, as have the banks on the question on opening of accounts and identities, and the following of the money trail. There will be brought to trial people who perhaps would never have thought that they would be in a court, because they are of a very sophisticated class, and not the usual type of criminal-although they certainly know how to make money, and they batten on to the unfortunate young. If one is looking at drug addiction, it is tragic to find that most of those caught up in addiction have come from broken homes. That is not axiomatic, but it follows through from the Family Court structure, and the issue of love and affection really comes into the human being having the stability and maturity to be able to deal with the pressures. If that love and affection is not present in their formative period of life, these people seem to be prone to addiction. Another interesting study-which is not proven, but it is suggested that it has some merit-shows that of the heroin addicts, 80 per cent had alcoholic parents. There is then a further factor in addiction that arises from the fact that the home might not have been going as well as it should. Mr Sinclair —Who did the study? Mr LIONEL BOWEN —It is a Sydney study. It is yet to be proven, but that is one of the issues. I just comment on it in the context of dealing with crime to say that in many cases, particularly regarding heroin, most of the addicts are under the age of 23 and most would not live beyond the age of 30. So there is a dreadful problem for our society. One can imagine what it does to their parents and others caught up in this issue. As honourable members would know, it was not prevalent in the 1960s; it has become more obvious in the 1980s. That is an issue that we are facing. The honourable member for North Sydney (Mr Spender), the shadow Attorney-General, raised a number of very important issues. He wanted to know about my constitutional commission. I think that I have said what I am about to say in the Convention debates. I went there this year asking that the Convention be adjourned for two years to enable an alternative method of constitutional reform to be considered. I think that the honourable member would agree with me that the only way in which we shall get constitutional reform in this country is on a bipartisan basis, and that it is very difficult to get bipartisanship in this area. Honourable members opposite would recognise that because, whilst at times we might have appeared to be bipartisan, when we reached the hustings we were anything but that. Of course, inevitably, the people do not want to say that they understand the situation if we appear to be disagreeing on the issue. That has been my criticism of the Convention itself. It has been meeting for 12 years and it has not had a lot of success. We have been able to give votes to the Territories. We have been able to fill casual vacancies in the Senate. There was one other matter which escapes me at present. Honourable members opposite would recall that when they were in government they did not even call the Convention together between 1978 and 1983, so it was not a high priority. The Cabinet has agreed with me that we ought to try to see whether we can get together some of the people in Australia who would have particular skills and would also be representative of the Australian people-on both sides of the political fence-but who also have communicative skills in order to be able to communicate with the people on what it is all about and, to see whether we can get a new or revised document. The honourable gentleman appears to be a bit concerned because I might have mentioned the name of Tom Keneally. I make no apologies for that. I think that he is a very effective writer. He understands the heart and soul of Australia. I must tell the honourable gentleman that in all the meetings in Australia held for a new constitution on the basis of democracy, particularly following the 1975 results, Keneally was always there and taking a leading role. It is not as though one just plucked him out of the air on the basis that he might not have shown any interest; he is very interested in talking about Australia as a nation and he feels that he has a contribution to make. As honourable members opposite would appreciate, although they may not necessarily agree, I think that there are opportunities for people to talk about a constitution and how it would represent the aspirations of the Australian people, and in my view Keneally could fulfil that role. I have mentioned the name Garrett not because I have ever met the gentleman but because young people relate to him. He also happens to be legally trained. If one looks at his lyrics-not that I encourage honourable members to devote a lot of time to them-one sees that he talks about the wishes and the needs of the people. If honourable members talk to young people, as I am sure they do, they will find them being very anxious to get the truth on what we are about in Australia. They have a great respect for each other, and to some extent they regard themselves, because they are young, as needing to be considered in the terms of documents that we write about their rights and their future. So that was an aspect of mentioning that name. I have never met Ray Martin, but I regard him as also being a first class communicator, particularly to an older group of people who relate to him. He also has skills, and I was pleased to hear him say that he felt that he would like to take an interest. Of course, they will not be the only people involved. I endeavoured to name the type of people who would be the nucleus in regard to looking at a document that might be suitable for Australia. I mentioned two former Prime Ministers, from different sides of the Parliament. I emphasise that on the basis of bipartisanship. I also mentioned the fact that I would be very anxious to get a retired High Court judge as chairman. At present I am waiting for an answer. If I can get that answer-and I hope that I will get it-I shall be able to go right ahead. At the moment, I want to talk about the calibre of the people who would attract a lot of legal weight in regard to the aspects of how they saw this document in practice. Whether they be High Court judges or parliamentarians, they have lived with this document and the problems and the problems of it. There must be recognition of the States. Consideration would need to be given to that. There must be recognition and consideration of local government. But the nucleus would be small, and in my view there would need to be some sub-committees that could make an input. The honourable member asked about the role for the present Convention. If it wished to continue, I would not be able to stop it. I would invite it to make a submission to the commission. That might be what it could do. But it is quite counter-productive for the Convention to be, as it was in recent efforts, with the surprising support of the Opposition, urging that we return to State excise taxes. That was one of the resolutions passed. I cannot imagine anyone in Australia wanting to have two types of taxes. People regard taxation as being onerous when it is levied by the Federal authority, but to think that they would now have a State tax as well would cause no end of trouble. I wait with bated breath for the Opposition to come forward with a policy at the next Federal election urging that there also be State excises; yet that is the sort of conduct that goes on. I am only stating this in terms of trying to get some understanding of what we are about. Finally, the honourable gentleman raised a number of valid issues in regard to legal aid. Substantial amounts of money are being paid in legal aid. One matter that the honourable gentleman raised was on the basis of how much work was being done in-house. It would have been a difficult question for me to answer, but fortunately I have just looked at a letter that has been put in front of me. It relates to legal aid, and it says: In 1984-85, 37.3 per cent of the total expenditure of all major legal aid bodies in Australia was devoted to salaries and administrative costs, while 62.7 per cent went towards payment to private legal practitioners. Of course, one could immediately say that that might be a pretty excessive administrative cost; but when one looks at the question of administrative cost, one sees that it means the salaried staff. The salaried staff conducted 217,658 advice interviews and 34,097 duty lawyer interviews and appeared in 75,364 duty lawyer matters. Mr Spender —We are a litigious nation. Mr LIONEL BOWEN —We are a very litigious nation. I make the point that the staff were not just sitting down looking at the files. They were really in action. The honourable gentlemen would know that the funding the Commonwealth provides is the major funding. However, the States also make a contribution. Our funding is in the vicinity of $72m. Last year, 70.9 per cent of the referred matters went to private practitioners and 29.1 per cent was in-house. The number of persons assisted by Commonwealth funding last year totalled 86,705. There are difficulties in the area of legal aid. The honourable member for North Sydney was probing the issue. I can understand that; it is fair. There is just not enough money to give legal aid in all circumstances. The task force report is out. It will be noticed that the major contribution has been made by the Commonwealth, as it has to be. Some States have very little input at all. They do not have any resources. New South Wales has a substantial input because it uses the money that is obtained from solicitors' trust accounts which runs into about $24m. That does not apply, for example, to South Australia. Very little money is contributed by some States. Nevertheless, the structure I have inherited is one of State commissions except in New South Wales, with which we are still negotiating a merger. The idea with the commissions is that the legal profession be represented on them. I place a lot of value on the profession. It does a lot of work for nothing and it seldom gets recognition for that. However, it is important to get its members to take an interest in how we might best deliver the $70m. On that basis we can get some results. If I can get the profession to talk to me about how best to do so in the various States I am sure that we would get co-operation. There would be occasions when particularly the young members of the profession would get very little indeed to appear in the local courts, but at least people would be represented. Regrettably, at present there is no legal aid for pleas of guilty or for committals. That poses a problem for us. In many cases one could be encouraged to visit duty solicitors and get some advice. I am sure that the profession would co-operate. I would be anxious to explore that with the profession. The sum of $38m in legal aid goes on family law matters, which is very surprising, considering that only 7 per cent or 8 per cent of matters are litigated. Again, there is an outrageous expenditure to the extent of the needs of others. There is a difficulty in trying to get the best results for people. I am very appreciative of the support given by the legal aid duty personnel as well as by the profession. It is a continuous effort. The fact is that we would all agree that we cannot give as much money as is needed. However, we would all expect it to be given to those in need. Mr Spender —What is the $5m reduction? Mr LIONEL BOWEN —I thank the honourable member for reminding me. The $5m was a reallocation within the same portfolio. As I understand it, the relevant document, which is not readily available, would show that there was a reduction in division 175 from memory. One will find that payments to the State commissions have been substantially increased. In other words, there has been a substantial increase in legal aid. The item concerning the $5m is merely a book entry, if I may use that term. The State commissions have received substantial increases to which the $5m went towards. There is a difficulty in that the State commissions are anxious to reduce their contributions. I have just had the departmental explanatory notes handed to me. The appropriation under division 175 for the Australian Legal Aid Office has been reduced. However, there has been a substantial increase in division 819.02, legal aid commissions, formerly division 175.3.03, which has gone from $37.1m to $56.2m. The $5m relates to that area. I think that addresses most of the matters. I thank honourable members for their contributions. Proposed expenditure agreed to. Department of Defence Proposed expenditure, $6,212,321,000. Department of Foreign Affairs Proposed expenditure, $1,129,023,000. Mr SINCLAIR(New England-Leader of the National Party of Australia)(9.37) —Unfortunately, in 10 minutes there is little chance of my doing as I would like. I guess that in many ways I should initially comment by saying that it is a great pity that we have this form of examination of the Estimates. As one who lived under another system and did not like it particularly, I still think that it is a pity that there is not an opportunity for greater dialogue. The contribution just made by the Acting Prime Minister (Mr Lionel Bowen) on the estimates for the Attorney-General's Department identified some of the advantage we would have if there were some exchange of views on some of the details of expenditure. In my remarks I will very briefly canvass an assessment of the strategic situation and then relate it to two areas that concern me in the estimates for the Department of Defence. In regard to the strategic situation, we know that Mr Paul Dibb is shortly to make a contribution. I would be interested to hear the view of the Minister for Defence (Mr Beazley) on the rate of progress there and what is going to happen about the Paul Dibb review. I see a number of problems. My colleague the shadow Minister for Foreign Affairs, Mr Peacock, is going to talk about ANZUS. We know of the situation concerning fishing rights for the Union of Soviet Socialist Republics in Kiribati and the problems with the defence co-operation program. I am not too sure of the rate of progress of the defence co-operation program. However, I am most concerned that the DCP be maintained. Some political prejudice has been shown about some of the aid programs in some countries, but for my money the DCP is a tremendously valuable way by which this country can help other countries in the region to develop their defence capability to enhance our overall regional security. Through DCP there is an opportunity for many countries to play some role with us. One way we can contain the impact of the Soviet fishing agreement with Kiribati is to make sure that we also continue to co-operate with Kiribati in the way it develops its own intrinsic defence capability. That allows me to refer very briefly to the Pacific patrol boat. I will return to it. I do not feel that it is adequate for the sort of aid programs I have in mind for that part of the world. Having mentioned the Soviet Union and ANZUS in passing, there are a number of particular problems that I hope Mr Dibb addresses. The circumstances of the hijacking of the Achille Lauro have shown the degree to which terrorism is rife. It is a threat henceforth not only to aircraft but also, presumably, shipping as piracy on the high seas is now possible, having been shown already to have occurred. I was delighted to hear the Acting Prime Minister say that he intended to contact President Reagan and commend the Americans on their apprehension of the four hijackers. I believe that there is an enormous problem unless something can be done about terrorism and hijacking. Let no one in this place be mistaken that the situation has been allowed to drift because internationally so little action seems in the past to have been possible. It is important to know that action relies very much on the defence forces. The relevance to Mr Dibb is that while it is true that, through the co-operation between various police forces around the world, some action can be taken against criminal figures, when it comes to terrorism essentially it has to be units such as our own Special Air Service Regiment in its counter-terrorist role to which attention needs to be drawn and from which assistance must be found if there is to be any apprehension of these people and if they are to be brought to justice in the normal course. Co-operation between countries is essential and Australia has a real role to play. I am also worried about the situation in New Caledonia and between Papua New Guinea and Irian Jaya. It is terribly important that we realise that the defence threat in this part of the world as a result is not just quiescent. It is not a matter of the Soviet Union being about to invade Australia. It is not a matter of there suddenly being a situation whereby any of us can see the prospects, even given what is happening in ANZUS, of there being an immediate threat to our territorial sovereignty here or in any of our island territories. But the strategic situation is changing and my problem in looking at these estimates is that there are a number of areas where I think the Government's reaction has been less than adequate. The first of those I wanted to address was the concern I have at the way in which manpower is being run down without what I regard as a proper concern for reasonable personnel strengths. There is no doubt that the consequence of the Government's decision not to replace HMAS Melbourne and to scrap the fixed-wing aviation capability in the Navy has had an impact on naval personnel. To be 1,600 down in two Budgets is to be down a lot of personnel. If we are going to reduce numbers in that way, I am afraid that there will be an impact on personnel and musterings. Of course, it has been assisted by the number of people unemployed in the community and, as a result, there have been some problems in maintaining younger recruits. I would be interested in figures the Minister might have about the degree to which there has been re-enlistment because senior sailors and senior non-commissioned officers have been re-enlisting, although I believe that that is changing because the rate of resignations has increased due to the attitudes the Government has generally taken to wages and salaries and terms and conditions of employment. I am quite concerned that at the moment there will be only a 5.9 per cent pay rise and that it was not retrospective. I believe there are problems with pay, conditions and housing. I know that the Budget provides some money for housing. I welcome the Government's move in that area and there is a totally bipartisan attitude towards the necessity to improve housing. I certainly would look to trying to sell much of the existing service housing instead of just repairing it. We have to address that problem when we look at the personnel situation. My concern is not only that the Navy strength is down by 1,600. We are also told now that the Army is to be reduced by 677 positions, and it is all for the sake of re-equipping. I do not have time to go into the detail of it, but I think it important we understand that the Reserves are weak and that there is a very real problem in trying to find adequate personnel to meet reasonable requirements. While I compliment the officers and crew of HMAS Perth and HMAS Adelaide for the role they played in the Hoelien attempted rescue and while Rear Admiral Ian Knox and his officers and men did a tremendous job in generally presenting the case to the Australian nation at 1985 shop window, there is a problem in trying to achieve adequate numbers to face the task. Sadly, when we look at the teeth to tail ratio we realise that Service numbers have declined. The number of civilians has increased but there is an even greater concern. The number of civilians has gone up from 38,775, including 15,000 in the Department of Defence Support, at 30 June 1983, to 39,102, without Department of Defence Support, in the comparable period of 1985. I know that we have to employ contractors. I know that there are problems where it is necessary for us to identify jobs that need not be duplicated within the Services. I think there is a need to try to introduce greater efficiency of manpower use and, indeed, utilisation of funds. The Minister and I have privately had some discussions on this, but I do not accept that we can reduce the number of Service personnel, have a weakened Reserve and be able to face the sort of threat situation I see about us. I speak of a threat with a small `t' and I have explained the anti-terrorism role and other roles. While I understand the development of a battalion in the Army with parachuting capability is a step towards perhaps improving our general ability to respond to terrorist situations, that is not its immediate or prime role. We have to look very carefully at the personnel area and I do not believe it is adequate at the moment. The area I really wanted to talk about was procurement. Perhaps I can highlight my concerns. I refer to the FA18 position. I have seen McDonnell Douglas's statement that the wing stress or tail pin stress which apparently has developed is something to do with the carry-through box. I would be interested to hear the remarks of the Minister on that. I think it very important that the Australian community be satisfied, as I am, that the FA18 is an excellent aircraft and that it has a very important role to play. I hope that the Minister has maintained his view that the F111s should be upgraded because they also have a role. I wanted to comment on the scrapping of project Waler and my concern about the A10 or Air Force trainer, the former Wamira project. I have some very serious doubts about the wisdom of upgrading the M113 family of armoured personnel carriers. I think it would have been far better, particularly for design and development capability in Australia, to have proceeded with Project Waler. I believe it is essential that the A10 should go to the Hawker De Havilland group and that it should proceed. I think it is an excellent aircraft. Unless we do that, design and development skills in the Australian aircraft industry will be virtually extinct. Frankly, I do not believe we can afford that, given the general pressures there are on the Australian manufacturing industry and the problems with trying to maintain the defence capability in this country. I believe that there is a requirement to upgrade Australian ability in procurement. I would like to hear the Minister's view on that. The DEPUTY CHAIRMAN(Mr Blanchard) —Order! The right honourable member's time has expired. Mr CLEELAND(McEwen)(9.47) —It is always interesting to follow the right honourable member for New England (Mr Sinclair), the great chameleon of this place who changes his colours depending on which side of the House he sits on. As Minister for Defence, what did he do for the defence forces? He ran down Defence Force personnel conditions. He allowed their housing to collapse. He did nothing for them whatsoever. Mr Sinclair —Rubbish! Mr CLEELAND —He now stands here in the guise of the elderly father figure telling this side of the chamber what we should do. He surely would be the most discredited member on the other side. His words are shallow and very hollow indeed. Within the electorate of McEwen lies Puckapunyal. That of course is one of the largest Army bases in Australia. Among its facilities are the Army School of Catering and the Australian Armoured Corps. Had the right honourable member gone there and seen the conditions he left them with, he would be ashamed of himself. With the increasing difficulty being experienced at Holmesglen and Singleton bases in New South Wales, Puckapunyal has assumed greater importance as a training facility for live weapons firing. Yet it has in many ways changed little since I spent some time there in 1958 and subsequent years. The conditions for defence personnel have changed little. Despite increased expenditure by both the Whitlam Government and the Hawke Government, 30-odd years of the Opposition being in government have left their impact. There are some 600 Defence Force houses within Puckapunyal and some 300 defence houses at the nearby town of Seymour. To say that the houses are inadequate is an understatement. It is a pity that the right honourable member for New England, a former Minister for Defence, is not forced to live in one of those houses as a penalty for his total lack of concern, and that of the Government he represented. We hear a lot from honourable members on the other side. They say that they are concerned about matters of defence and about conditions of Defence Force personnel. Any examination of their actions in government compared with their rhetoric show the shallowness of their position. The right honourable member for New England, when Minister for Defence, approved the building of a new school of catering at Puckapunyal. It is a great building. But the right honourable member for New England failed to ensure that the building was air-conditioned. It was made of solid reinforced concrete and equipped with modern cooking equipment. It was so good that it could not be used. Temperatures of 50 degrees celsius were experienced. It had to be closed and some $4m spent over two years to make the building habitable. That is the legacy of the former Minister. That is the sort of policy he put into effect. This Government, the Hawke Labor Government, has inherited that lack of concern with defence which, despite its rhetoric, the Opposition inflicted on the defence forces. This appropriation provides for significant ongoing projects for Australia's defence forces, including $912m for the purchase of 75 FA18 aircraft and associated equipment; $144m for materials and initial construction work on the two guided missile frigates to be built at Williamstown dockyard; $97m for modernisation of the first of the three guided missile destroyers at Garden Island dockyard, New South Wales, and the remaining three destroyer escorts at Williamstown dockyard; $70m for the acquisition of eight Seahawk helicopters for operation from the four FFG frigates; $70m for 10 additional Orion aircraft being purchased from Lockheed to replace the existing aircraft; and $49m for four United States-built guided missile frigates to cover final payments and deck strengthening for helicopter operations. Other projects include $41m for medium trucks to replace existing 2.5- and 5-tonne general service vehicles with 4-tonne general purpose and 8-tonne cargo vehicles; $35m for the acquisition of short and medium range air-to-air missiles for the FA18; $28m for the acquisition of Harpoon and standard missiles and MK48 torpedoes; $24m on aircraft to replace the CT4 trainer-- Mr Hodgman —Look what you have done to HMAS Huon. Mr CLEELAND —The honourable member should go to Puckapunyal one day and see the mess his Government left there and what it did for the soldiers. He would be absolutely ashamed of himself. The DEPUTY CHAIRMAN(Mr Blanchard) — Order! The honourable member for Denison will restrain himself. Mr CLEELAND —That would be very difficult for him, Mr Blanchard, because it is after dinner. Other projects include $23m for various Army communications projects, including new single channel radios, replacement cryptographic equipment and the Hiport/Medport trunk communications equipment; $21m for the continued development of the basic defence integrated secure communications system which, with the final phase recently approved, is planned for completion by the end of 1990; $19m for the underway replenishment ship being constructed at Cockatoo Dockyard, New South Wales; $12m for the construction of two prototype minehunters by Carrington Slipways in New South Wales; and $10m for the acquisition of 105mm field guns produced through a joint production arrangement between the ordnance factories at Bendigo and Maribyrnong. Some of those guns are currently being used at Puckapunyal and the troops are being trained on them. They are very fine weapons. The Hawke Labor Government is not concerned only with equipment purchases. Unlike the Opposition, the Government is concerned to remedy the lack of facilities for Defence Force personnel and their families, surely the most neglected group of people in this country. They were neglected for years by the Opposition, who worried only about capital equipment and did not give a damn for the personnel involved and the people they represented. A total of $61m is allocated for expenditure this year for acquisition and construction of new and replacement houses for Defence Force personnel and for improvements to the existing housing stock. Also, 680 new housing commencements are planned for 1985-86, with substantial programs in a number of locations. In Brisbane there will be 30 houses for Army; in Toowoomba 29 houses for Army personnel in the Oakey-Toowoomba-Cabarlah area; in Sydney 205 houses in the metropolitan area for Navy and Army; in Melbourne 39 houses for Army; in Adelaide-Woodside 85 houses for Army and Air Force, and in Woomera 50 houses. Major housing programs started in previous years are also continuing at Holsworthy, Rockingham, Puckapunyal and Darwin. Consistent with practice in recent years, the 1985-86 defence outlay includes a provision of $162m as an allowance for the effects of possible wage and salary increases. The overall amount provided is not a forecast of likely individual arbitration decisions nor a statement of the Government's position on particular pay claims. It is a provision aimed essentially at achieving a more realistic presentation in aggregate terms of the likely budget outcome. The Government will seek appropriations through the Parliament in the normal way to meet the requirements flowing from such pay cases. It should not be forgotten that it was the Hawke Labor Government that introduced the Defence Force Remuneration Tribunal. No longer will Defence Force personnel be dependent upon the whims of people like the right honourable member for New England to obtain wage justice. Defence Force personnel will not be forgotten again in future and their conditions will not be reduced beyond the normal working conditions of other people in this country. They will not go backwards, as they did under the previous Government, and there is no reason why defence personnel should go backwards. There is no reason why they should be forced to live in the miserable conditions that they put up with in previous years. Mr Sinclair —Then why have you forgotten about them for two and a half years? Mr CLEELAND —The right honourable member for New England can sit back and bleat forth but he knows what he did to them. The Army knows and the Defence Force personnel generally know what he did. There was no real increase in defence expenditure under his administration, but under the Hawke Labor Government there has been a real increase each year in expenditure on defence. That was something the Opposition could never do and under its current policy of cutting expenditure it is something it would never do in the future-if this country were unlucky enough to have the Opposition in government again. I am pleased to see that at Puckapunyal a total of $3.94m is allocated for housing, an armoured centre and training kitchens, which are near completion. New projects that will begin in 1985-86 include nine houses and a range control complex. There is an additional important program. Personnel are putting together a very good soil conservation program to repair the damage which existed for many years under the previous Government. The Opposition damn near destroyed the place. About 60 per cent of the land was not usable under the previous Administration and it has cost nearly $10m to restore that land as an effective operational range again. That is something the Opposition did not do in government; it was not concerned about it. The Opposition does not worry about personnel. It likes F111s, FA18s and big tanks, but it does not worry about Defence Force personnel. I can tell Opposition members now that the Defence Force personnel know what is happening. They know why they have not got good conditions, they know who did nothing for them, and they know that this Government has done a lot more for them than the Opposition ever did or ever will do. Mr PEACOCK(Kooyong)(9.57) —The less said about the previous contribution the better. The inanities of the honourable member for McEwen (Mr Cleeland) were exceeded only by the ignorance. I wish to speak briefly tonight in the time available about the unravelling of ANZUS under this Government. On assuming office the Labor Government reviewed the ANZUS Treaty and decided, interestingly enough, in the Foreign Minister's own words: . . . to an unequivocal reaffirmation of the Alliance as fundamental to our foreign and defence policies. What is deplorable is that in having accepted the centrality of ANZUS to our foreign policy, Labor has done nothing to stop the Treaty unravelling. For more than a year now the Opposition has called on the Government to involve itself in the dispute over nuclear ships and to work for a solution to the crisis. For more than a year now the Government has stood by and done virtually nothing. We are now confronted by a situation where ANZUS is, in the words of the Prime Minister (Mr Hawke), inoperative, and the Treaty is liable to review should New Zealand proceed with its nuclear-free zone legislation. Mr Cleeland —You have your angry face look. Mr PEACOCK —Listen old son, we would not even know where that face of yours came from. We had to look up the Hansard to see your name. You are hardly a statesman-like character whose name is on the lips of all Australians. I will test my record in this Parliament against yours when it falls to the ground at the next election. I mentioned the review the United States is talking about. The Minister for Foreign Affairs (Mr Hayden) is returing from Washington, having ducked and weaved and further fudged Australia's position. I ask tonight: What is the Government's position on the New Zealand legislation? What is the Government's position on a review of the pact? What is the Government's view on the current legal and operational status of the Treaty? This is not an issue on which, as the Government would wish, we can be neutral because it cuts across our fundamental security interests and those of the Western alliance. The American stand is perfectly correct. Yet this Government has no clear message to the New Zealand Government about where we stand. It has made no attempt to take a mediatory role and has made no attempt to work for a solution. Even now, no attempt is being made to dissuade New Zealand from its anti-nuclear legislation. The Prime Minister knows all this and he knows what he should have done. He wrote one letter to the New Zealand Prime Minister. When it leaked, because of his fear of the Left's reaction, he disowned the letter. He again showed the weakness of the factional compromise that has become the hallmark of the administration of Labor's foreign policy. He went back to perpetrating the big lie that this crisis was `one between New Zealand and the United States only'. It is not. It affects our interests, those of the region, and the Western alliance as a whole. The Government has sought to justify its dereliction over ANZUS by saying that it will preserve the bilateral defence relationship between Australia and the United States. This of course misses the point. The ANZUS Treaty is now a hollow shell and we are left with something much less. The termination of defence co-operation between the United States and New Zealand has diminished Australia's security and stability as well as that of the region. The co-ordination, the intelligence sharing and defence co-operation made possible by ANZUS, and the authority that alliance membership gave each of the three partners have been vital to effective regional responses to the Soviet Union's attempts to make strategic inroads into the Pacific. A bilateral relationship between Australia and the United States on the one hand and between Australia and New Zealand on the other is a very poor substitute for the tripartite influence made possible by ANZUS. The fact that the Hawke Government allowed ANZUS to become inoperative will only encourage renewed Soviet attempts to make new strategic inroads into the Pacific, while hampering our capacity to resist the erosion of regional integrity. The unravelling of ANZUS has caused justifiable concern to our friends in South East Asia and the Pacific. The sort of warning we have given about Soviet interest in wanting to see ANZUS unravelled has not come just from us. Let me read to honourable members what Paul Dibb, the Federal Government's newly appointed defence adviser, stated recently: The Soviet Union would like to see the ANZUS alliance system disrupted in its favour and the close relationship that has developed between Australia, New Zealand and the United States with the ASEAN countries and with the nations of Oceania destroyed. The importance of ANZUS to the USSR needs to be clearly understood. This is not a viewpoint expressed solely by the Opposition; it has been expressed by the Government's defence adviser. What should be made crystal clear is that it is the United States presence and the ANZUS pact which have underpinned the region's economic dynamism. Any weakening of the ability of the United States to perform its role could seriously undermine the stability and economic prospects of the region. Furthermore, the regional role of ANZUS cannot be divorced from its global role. It has been an important link in the network of alliances that make up the greater Western alliance. We should also be clear about the value of the Treaty as our ultimate guarantee and about what Labor has put at risk. The intention of the United States has long been that it would help Australia in the event of a serious military conflict. As recently as last year, Mr Paul Wolfowitz, the United States Assistant Secretary of State, East Asian and Pacific Affairs, said: Let there be no doubt in the mind of any potential adversary that an armed attack on an ally would require, and would receive from the allies, full and prompt fulfilment of the ANZUS security commitment, including, when necessary, military. There is a further compelling reason why the existence of a healthy ANZUS is important to our security, and that is its deterrent value. The fact is that the very existence of ANZUS means that any country seeking to take military action against Australia would also have to take into consideration Australia's relationship with the United States, and the nature of the support that the United States would extend under the Treaty. All this could now be lost. The United States proposal to review the ANZUS Treaty should New Zealand go ahead with its anti-nuclear legislation is an understandable if regrettable step in order to clarify the present situation-a situation where the Treaty is falling into some form of operational and legal vacuum. Yet what is the Government's position? Once again it has remained silent and it has put its factional problems ahead of our fundamental security interests. The Government should have acted earlier to prevent the situation deteriorating to such an extent. It now must act to ensure that any review does not reduce the United States guarantees to Australia under the Treaty and that any congressional intervention in the review process does not threaten Australia's interests. It should not have come to this, but a successfully conducted review process which avoids these pitfalls will be an important element in restoring ANZUS to centrality in the Australia-United States relationship. I expect the Minister for Defence (Mr Beazley), who is present in the House, to give us at least some perception tonight of the Government's thinking on this matter. As I said at the commencement of my speech, this Government stated a year ago that ANZUS was fundamental to our security. It has watched as the ANZUS Treaty has unravelled. It is no longer operative. The United States is now threatening a review of Treaty arrangements in view of the impending New Zealand legislation; yet this Government still maintains that it is a dispute solely between the United States and New Zealand. Although the ANZUS Treaty is a three-country treaty, the Government will not inject itself into this argument. Mr Slipper —Why not? Mr PEACOCK —Because it is scared of the approbrium and action of the Left and Centre Left should it do so. This non-action is occurring while our country's most basic defence treaty is unravelling. It may be good enough to provide the sop to deal with factional disputes, but it is not good enough as far as I am concerned when the Government has allowed our basic defence security to reach the situation which has been deemed by the Prime Minister of this country to be non-operative. Mr CHARLES(Isaacs)(10.06) —Most of what the former Leader of the Opposition and honourable member for Kooyong (Mr Peacock) had to say could be disregarded in this House this evening. Honourable members on this side of the House would agree with a number of things that he said about ANZUS. Some may agree or disagree with the statement that a bilateral relationship was a poor substitute. Basically, he was suggesting that, no matter what occurs, we should drag New Zealand-an independent country-whether it wants to or not, to the starting barrier to become a full member of ANZUS. He proposes that, no matter what New Zealand wanted, no matter what we think it should do and no matter what the United States of America, the public in Australia or the Government of Australia think they should do, we should drag New Zealand to the starting barrier. That is pure and unadulterated nonsense and the honourable member knows that, because that cannot be done to any country. The ANZUS Treaty is a very important treaty. It has been part of Australia's defence background for the last 3 1/2 decades, and will continue to be so with regard to our relationships and frendship with the United States of America. I refer to the speech made by the Leader of the National Party, the right honourable member for New England (Mr Sinclair), when he congratulated our Acting Prime Minister (Mr Lionel Bowen) on his answer to a question this afternoon in support of the United States retaliation against terrorism. I agree with that statement, because international thuggery has gone on for too long. When the opportunity arose-some people believe this should happen every day, but it does not-the Americans took that opportunity aboard. I suggest that, if we were in such a position, Australia would do exactly the same thing. I am pleased to speak this evening on the Foreign Affairs portfolio. This Government has had an outstanding record in foreign relations, and it has spoken out very clearly and independently on a number of issues; namely ANZUS, Indo-China and disarmament and arms control, just to name a few. A more independent voice is being heard for the first time and Australia's foreign policy orientation is being directed more to the Asia-Pacific region. That has not always occurred, and that was especially the case during the 1950s and 1960s under Prime Minister Menzies. Indeed, the people of Australia did not see any change in focus or ideas until the Whitlam Government took office in December 1972. Australia, geographically, is part of the South East Asia-South West Pacific region, no matter what friendships or other ties we have elsewhere. Of course, that is not to dismiss those friendships in any way. However, the fact is that we are part of one of the fastest growing regions in the world. The region has advanced economically in incredible leaps in the last decade and a half. Our economic and cultural future lies in this region. We have seen our country change a great deal in the last three decades to become a multicultural society. Our co-operation with the Pacific states will be of great importance to us in the years ahead. Australia could find itself giving substantial assistance to many of the Pacific states in a way that not only would meet their requirements but also could not be met by the super-powers. The South Pacific Forum, although still young, is growing into a vibrant and meaningful organisation. Whilst noting that Australia has improved a great deal over the past few years in recognising the concerns and wishes of the Pacific people, I acknowledge that much has still to be done. No region in the world is more significant to Australia than the Pacific. The infiltration of the Soviet diplomatic network into the Pacific should be of major concern to us all. Let there be no doubt that this is occurring, including a pronounced communist influence into the trade union movement in and around the Pacific region. On the other hand, I believe very strongly that the Pacific people do not need Big Brother telling them what to do or when they should do it. They need independence. They need assistance that will make them self-sufficient and self-assured of their future. It is in this area that the present tuna fishing policies being adopted by the United States cause me some concern. Since the election of the Hawke Government we have also seen Australia's election to the United Nations Security Council. It is also appropriate to point out at this time that Australia will take its turn to chair the Council next month. It has been through the United Nations and other forums throughout the world, notably in Geneva, that Australia has pursued another very important issue, that of disarmament and arms control. This issue is undoubtedly one of the most important of our time. The Joint Committee on Foreign Affairs and Defence of this Parliament has had this important issue as one of its references for nearly two years. As Chairman of the sub-committee that has investigated the reference of disarmament and arms control, I can verify the complex nature of the subject. The Committee should be able to present what will be a major report to the Parliament early next year. I hope that this important forthcoming report will form the basis for the nuclear and arms control debate in this country. Whilst I cannot discuss the contents of the report until it is tabled, it is my belief that the standard of debate in Australia has generally been fairly poor. For example, `disarmament' is a word that is often misused and it can give people a false impression. Are we seriously to suggest that we should unilaterally disarm? Some people amongst us say: `Yes'. But, quite obviously, that connotation is ludicrous. I believe that arms control is more appropriate as it applies to the practical world of today. Against this background of complex international politics Australia, with Foreign Minister Hayden leading the way, has spoken out on a number of arms control issues, placing Australia's view before the world so that our position can be clearly understood. There are those amongst us who throw the word `nuclear' around very loosely; they tie it to everything that is bad. Thus, the issue of the joint facilities, visits of nuclear-powered ships, and even the very presence of the odd United States general or admiral raise their absurd rhetoric to high levels, beyond the bounds of sanity. I say this because the next step is, of course, the dismantling of ANZUS and, further, Australia moving to an unaligned position and complete neutrality. Let me place Australia's position clearly before the House. We are not pacifists; we are not unaligned. We are part of what is called the Western group of countries and we have a defence capability which is strong enough to deter most would-be aggressors. Therefore, we will continue not only to look after Australia's interests and the interests of the Pacific region but also, beyond that, to have an overview of all issues and to place them in a global context. To suggest in this age that Australia, keeping in mind our geographic position, can be neutral is complete nonsense. Gone are the days when one could realistically hope to isolate oneself from the rest of the world and survive. For example, the joint facilities must be seen in a global context and as a price Australia is willing to pay for the continuation of the ANZUS alliance, the strengthening of the strategic balance and the general position of the Western allies. ANZUS and Australia's position in the Western world have been attacked many times over the past three decades. However, it must be stated that all the separate issues that surround ANZUS, such as visits of nuclear-powered ships, and indeed the wider question of Australia's security must be taken and looked at as a whole and not separately. An overview is needed, which unfortunately is so often glossed over by some amongst us. Foreign relations and defence planning are by their very nature complex questions with many ingredients coming together to make the whole cake. Our relationship with the United States has matured under this Government. The friendship and the bond between our countries are stronger than ever. Both partners in a relationship must respect the other. It is this respect which holds us together in times of difference, Yes, there will be times when we will disagree with the United States on issues. However, the fact that we can now sit down and discuss sensibly with our friend all aspects of policy is a very big step forward. I commend to the Committee the appropriations for the Department of Foreign Affairs. The DEPUTY CHAIRMAN(Mr Blanchard) —Order! It being 10.15 p.m., I shall report progress. The Deputy Chairman having reported accordingly- Mr SPEAKER —Order! It being past 10.15 p.m., I propose the question: That the House do now adjourn. Mr NEHL(Cowper)(10.16) —I welcome the opportunity tonight of speaking about the Australian youth traineeship scheme, which has been introduced during what has been well and truly known as the multi-Budget which has made its first appearance in 1985. I am all in favour of this Australian youth traineeship scheme. Not only are people the most important resource of this or any other country, but the young people of this country in particular are our most important resource. I want to pay some tribute to the Government by admitting that youth employment in the 15 to 19-year-old age group has risen by 12,000 in the period from March 1983 to August 1985. That is not much in two and a half years, but the figure has increased by 12,000. As I regard myself as a fair dinkum Australian, I have to do the right thing and applaud that. At the same time, I have to acknowledge that the number of unemployed people in the age group of 15 to 19 years has fallen significantly. But it is remarkable and significant that 135,700 youngsters were still unemployed in August 1985. It is interesting that, although that is the case, unemployment is still growing rapidly is some regional areas. In my electorate of Cowper unemployment among the 15 to 19-year-old age group rose by 20.35 per cent between June 1984 and June 1985. Naturally, that is something that concerns me very much indeed. Therefore, I am naturally very prepared to support any reasonable scheme which will assist the youth of this country and ease unemployment. Equally naturally, I am prepared to support the Australian youth traineeship scheme. I would like to see it have a fair chance of success. I think it most appropriate that the Government calls it Priority One. But I also ask the question: Who else is calling it Priority One? It seems that some of the so-called friends of this Government are hell bent on destroying it before it even gets started. In fact, the Government has adopted policies which tend to torpedo its own scheme. The Treasurer (Mr Keating) is torpedoing the scheme because the fringe benefits tax definitely will reduce and has reduced employment opportunities for young people. Already, as we all know, 1,000 jobs have been lost in Victoria alone.- Mr Slipper —How many? Mr NEHL —In Victoria alone 1,000 jobs have been lost in the tourism and hospitality industry, and the fallout has only just started. In 1981-this is the most recent figure I have available-restaurants employed 38.6 per cent of all of those employed in the tourism and hospitality industry. It is a very important sector. In his Budget Speech, the Treasurer said at page 5: . . . the Government will negotiate with the States to achieve a remission in 1986 of payroll tax and workers compensation premiums for employees under 21. What has happened? So far, from the four Labor Premiers there has been a deathly silence about payroll tax and workers compensation. It is significant that the Treasurer has not said another word about the progress of these alleged negotiations. That deathly silence has come from the Treasurer as well as from the four Labor Premiers. If this scheme is to be successfully started from 1 January 1986, we had better get a move on. Where is the union support? The two main industries for traineeships are retailing and tourism and travel, and the appropriate unions have both refused to go along with the Government on it. Where is the accord now? Where is the co-operation between the unions and the Government on Priority One? The unions are giving it priority zero. I appeal to them and to the Government to give the Australian youth traineeships a fair go and really make them Priority One. I think it is important that we should make something positive happen for the youth of Australia. Let us all give Priority One a great deal of support. Let us ask the unions to come to the party. Let us also ask those State Premiers to come to the party and help the Government introduce this most important youth traineeship scheme. Mr MILTON(La Trobe)(10.21) —On 18 September the honourable member for Higgins (Mr Shipton) drew attention to an industrial dispute in his electorate involving Dollar Sweets Co. Pty Ltd and members of the Victorian branch of the Federal Confectioners Association of Australia. The honourable member in his speech misrepresented the position of the union and its members who have been stood down by Dollar Sweets and it is my intention tonight to put the record straight. In the first place, the dispute did not begin with the claim for a 36-hour week in breach of the prices and incomes accord. The union initially held discussions with Confectionery Manufacturers of Australia Ltd in June 1982 on proposals for a shorter working week. On 1 July Confectionery Manufacturers agreed, on behalf of its members, which included Dollar Sweets, to the introduction of a 36-hour week and the methods of implementing the 38-hour week as follows: (i) We would undertake to introduce the 36 hour working week in 1983 with the optimum date being the first full pay period commencing after 30th June. (ii) The method of implementing the 36 hour working week would be the subject for discussion with your Union prior to its implementation recognising the special needs of small manufacturers. (iii) The above commitments are made on the basis that it is accepted that the needs of the small manufacturers in the main make a `Shorter Friday every Friday' the only practicable and economically viable way of maintaining smaller business competitiveness when the 38 hour week is operating. (iv) That the arrangements, many of which are already in operation for the introduction of the 38 hour working week, are implemented without disruption. On 23 August 1982, the confectionery manufacturers withdrew their offer on the ground that the 38-hour week was now operating and that union industrial action at Dollar Sweets and Fyna Foods (Victoria) Pty Ltd amounted to a non-acceptance of the manfacturers' offer. One has to bear in mind that the prices and incomes accord with the Federal Government was not signed until February 1983. So it was a clear distortion of the facts for the honourable member for Higgins to state that the dispute was in breach of the prices and incomes accord, which at that time did not exist. However, to get back to the industrial dispute, the workers at the factory were most unhappy at the repudiation of the shorter working hours issue by the confectionery manfacturers. After many meetings with no apparent resolution of the dispute the workers at the factory held a secret ballot which supported the implementation of a 36-hour week and they called on their union to pursue the matter on their behalf. The Confectioners Association approached the Dollaw Sweets management for discussions but the management refused to hold discussions on the issue. As a result of the intransigent attitude of the management, the workers held a several hour stop work meeting. The management continued to refuse to talk to union representatives about the matter and, as a consequence, the workers took strike action. On 18 July 1985, the Managing Director, Mr A. J. D. Stauder, sent a letter to the employees which included the following statement: The company cannot continue to operate with the threat of stoppages of work hanging over its head. I would like you to read the attached letter. It says, in effect, that you have a week to make up you mind whether you will give the company an undertaking to work normally without strikes or bans. If you are not prepared to give us that undertaking your services will be terminated as from 25th July 1985 at the end of your shift on that day. Mr Hollis —Fascist activity. Mr MILTON —Indeed. Subsequently, there was no attempt by the Managing Director, Mr Stauder, to negotiate with his employees. Instead, he dismissed them and hired strike breakers in their place. As far as the union is concerned, the central issue in the dispute now is the employment of strike breakers and the dismissal of employees taking legitimate industrial action. I have been prompted to inform the House on this matter because of the inaccuracies and ridiculous attacks on the Federal Government contained in the speech by the honourable member for Higgins. Let me end by quoting the view of the Australian Council of Trade Unions on this issue as contained in a Press release of 27 September 1985: The Secretary of the ACTU, Mr Bill Kelty, today pledged the ACTU's support for the Federated Confectioners Association in its long running battle with Dollar Sweets. The Melbourne confectionery manufacturer. The union had initiated all conferences in the last month and had clearly demonstrated its desire to resolve the matter within the wage fixation principles. The company having wrongfully dismissed workers because they refused to give up basic industrial rights and sign a company letter which would have left them defenceless, has refused to negotiate. This union and its members are entitled to and will get the protection of the Australian trade union movement. Mr Kelty called on the parties to confer before the appropriate tribunal, the Australian Conciliation and Arbitration Commissioon, and genuinely resolve a bitter and difficult dispute. Mr HODGMAN(Denison)(10.26) —Tonight I dedicate my remarks to the memory of a very great Australian, the late Raffaele Favero, and to his wife Jill, who is present in the chamber, and his son Adam, aged nine. Australia must speak out, and speak out strongly, against continuing Soviet atrocities in Afghanistan. Last year I visited the Afghan refugee camps in Badabhair, Pakistan, and there I collated evidence of Soviet war crimes in Afghanistan which I then described as equal to the very worst Nazi atrocities of World War II. I have to ask: When will the Australian Government raise its voice in protest against Soviet atrocities in Afghanistan? The Soviet Union is the dirtiest, most cruel and most cowardly fighter in the world today. I saw with my own eyes the results of Soviet atrocities and I was both shocked and sickened. Soviet atrocities against the people of Afghanistan are war crimes of immense proportions, involving the use of illegal chemical warfare, village massacres of innocent civilians, particularly children; the use of internationally banned dum dum ammunition and the deployment of vicious Soviet booby traps. In the Afghan refugee hospital in Peshawar I saw a small Afghan boy aged about nine years-about the same age as Adam Favero-who had been blown up by a Soviet booby trap in his village. Both his legs had been amputated. I spoke personally with two doctors who had actually seen and treated victims of illegal Soviet chemical warfare within the previous fortnight. The doctors told me that the victims had atrociously blistered, discoloured and ulcerated skin. The doctors had no doubt that these vile and gruesome injuries were the direct result of Soviet chemical warfare. It is significant that reports from Thailand also confirm the use of chemical warfare by Soviet-armed Vietnamese troops who have crossed the border into Thailand in recent times. Wherever the Soviet Union is engaged in military activity, whether it be in Afghanistan or Indo-China, there are authenticated reports of the use of internationally banned chemical warfare. When will Australia summon up some moral courage and protest against these outrages? The Mujahideen freedom fighters are the most impressive people I have ever seen in my life. Despite the atrocities being perpetrated against them, the Mujahideen are thrashing the Soviet troops on the ground. Soviet soldiers are becoming increasingly demoralised, Soviet commanders are resorting to dirty warfare as they face failure after failure in their attempts to subdue the Afghan freedom fighters, and the Union of Soviet Socialist Republic soldiers have had their tour of duty cut from one year to 180 days because they cannot cope emotionally with what they are being forced to do. It is well known that the Soviets are using conscripts in the Afghanistan war. In the early days of the Soviet invasion of Afghanistan, bodies of Soviet soldiers were sent back for burial and official lists of those killed were published. Now, because of continuing successes by the Afghan freedom fighters, no bodies are repatriated and no lists are published. On the question of internationally banned dum dum bullets, medical authorities in Peshawar have conclusive evidence in their possession. I actually saw X-rays of an Afghan civilian whose body had been riddled with the shrapnel from dum dum bullets used by Soviet troops who had attacked his village. In the most cowardly manner Soviet troops usually attack Afghan villages when they know that the menfolk will be away. In short, they attack unarmed women, children and grandparents. Another example of the Soviet cowardice in Afghanistan is the use of high level bombers and heavy density bombing against villages. Raffaele Favero was a very great Australian who gave his life to bring to Australia and the rest of the world the atrocities that are being committed day after day in the forgotten war in Afghanistan. I appeal to members on both sides of the House to speak out against the continuing Soviet aggression in Afghanistan, to speak out against the atrocities and the barbarities. If they do not believe what I say, they should look at the films of Raffaele Favero and listen to Jill Favero's speeches. Mr SPEAKER —Order! The honourable member's time has expired. Dr CHARLESWORTH(Perth)(10.31) —Last Thursday evening in Perth we had further evidence of the oustanding performance of the Western Australian Labor Government. Indeed, the Budget that was delivered last Thursday evening contained a number of milestones, but for the first time in 40 years a Western Australian Government budgeted for a surplus. For the first time on record the State's per capita public debt has fallen. Of course, the Budget has been widely applauded and it is the result of very restrained, careful, responsible and innovative government in Western Australia. The Budget does two things: It further creates an environment for private sector growth and job opportunities while providing also an infrastructure for better living conditions for all Western Australians. It also pays attention to those things which enrich and improve the lives of all Western Australians, and will certainly increase the number of opportunities available for young people over there. There are also significant real increases in education and health expenditure. Indeed, the Premier announced a 54 per cent increase in housing expenditure with special provisions for senior citizens to finance their homes through traditional sources. A further $13.1m was made available for employment strategies which should provide employment opportunities for more than 6,000 young people next year. I am sure that honourable members on the other side of the House are all interested that for the business sector we have action rather than rhetoric. For the second year in a row, the Western Australian Government has cut payroll tax which is such a disincentive to employment. The Burke Government is doing something about it. Payroll tax in Western Australia is now levied at 4 to 4.75 per cent, whereas in the other States it is levied at 5 to 6 per cent. For the second year in a row the Western Australian Government has decreased the financial institutions duty so that it is now the lowest in Australia. To top off all that, there is a 10 per cent reduction in land tax. Small businesses especially will be the beneficiaries of this growth and development and of course the whole Western Australian community will be in a better situation as a result of this. The truth of this Budget is, of course, that it is a reflection of the buoyancy and the growth of the Western Australian economy. Under the Burke Government Western Australia is fast becoming the economic engine of the country. We have the lowest inflation rate, the fewest industrial disputes and the largest growth in new car registrations. We have two times the national average of fixed capital expenditure by private investment. My attention was drawn to the performance of the Burke Government by an article in a newspaper last week which compared the two resource rich States in this country, Queensland and Western Australia. It is salutary to have a look at the comparison of the figures for Queensland and Western Australia. Of course, the Queensland Government, as we all know, has an albatross around its neck in the form of the Bjelke-Petersen Government. Twelve economic indicators which were taken up in this survey, including: Employment, unemployment, new motor vehicle registrations, housing approvals and commencements, actual new fixed capital expenditure by private industry, mining and manufacturing, retail sales, work days lost and bankruptcies. I am sure all honourable members will agree that that is an impressive list. In all those 12 categories Western Australia outstrips Queensland's performance. In fact, in only one of those categories do we find Queensland scoring above the national average. The fact is that the Queensland Government is going badly. It is stumbling and its performance has been rotten. The National Party of Australia must accept responsibility for its dismal record. The Western Australian Government is establishing itself as a good economic manager and the development that is occurring is very impressive. The dismal performance of the National Party Government in Queensland is in sharp contrast to the excellent performance of the Burke Government and I think the Budget brought down last week is a further indicator of that contrast. Mr McGAURAN(Gippsland)(10.35) —I wish to draw the attention of the Parliament to the continuing campaign of retribution by the Australian Council of Trade Unions against the National Farmers Federation and the Opposition for the success achieved at the Mudginberri meatworks. The meat workers union, namely the Australasian Meat Industry Employees Union, together with the Transport Workers Union, has been waging a campaign of selective bans aimed at hurting the chilled meat export market. There was an industrial walk-out today at the abattoirs of Thomas Borthwick and Sons (Australasia) Ltd at Portland. Last Friday inspectors from the Department of Primary Industry walked off the job. Last Thursday inspectors walked off the job in South Australia and Western Australia, and last Wednesday porters from Qantas Airways Ltd walked out and no cargo at all was shipped from Tullamarine International Airport. The story goes on and on. Mr Hand —Good on them. Mr McGAURAN —The honourable member for Melbourne, who has the dual role of President of the Victorian branch of the Australian Labor Party as well as representing his con- stituency, has advised the House: `Good on them'. The tale continues. On Tuesday of last week-- Mr Hand —Mr Speaker, I raise a point of order. The reason I said: `Good on them'-- Mr SPEAKER —Order! The honourable member will resume his seat. He knows that is not a point of order. I call the honourable member for Gippsland. Mr McGAURAN —Last Tuesday porters with Trans Australia Airlines, who handle cargo for Japan Air Lines, British Airways and Lufthansa German Airlines also walked off the job. Make no mistake about it; the direct result of the successes achieved at Mudginberri has led these unions to seek to retaliate and to punish those engaged in the export of meat. The problem is that the consequences flow beyond the meat exporters. The result is that the country suffers because it is losing valuable markets in the Middle East, to the tune of millions of dollars. I have telexes from supermarket chains in the Middle East, namely Bahrain, which show that Australia is regarded as an unreliable supplier. Exporters in Australia have taken years-the Minister for Trade (Mr Dawkins) and the Minister for Primary Industry (Mr Kerin) will support this-to develop these markets and they are week by week propositions because the meat is only chilled. It is fresh meat; it is not frozen. Consequently, Australian exporters, and in turn rural producers and, I may say, all Australians, are becoming all the poorer because of this campaign of hatred. Make no mistake; Wally Curran, the head of the union, was reported to have said: `We will make employers pay many times over for Mudginberri'. Mr Hand —He should not be allowed to talk like that. Mr SPEAKER —Order! Mr McGAURAN —That campaign of industrial anarchy is continuing unfettered. Mr Hand —He should-- Mr SPEAKER —Order! The honourable member for Melbourne defies the Chair. Even at this late hour I will take action if he persists. I call the honourable member for Gippsland. Mr McGAURAN —My question to the Parliament is: What is the ACTU doing to prevent this or to bring to the negotiating table the warring parties? The answer is nothing. Instead the ACTU and, in turn, the Government are facilitating these industrial anarchists. There is no other word for them. They are wrecking not just the reputation of this country but also the livelihood of hard working exporters and even harder working primary producers. Unless the Government turns its mind to these increasingly serious problems it will not have the credibility to represent all Australians. It is nothing but a puppet of the ACTU which daily is entering a quagmire of industrial anarchy. Dr KLUGMAN(Prospect)(10.40) —The Nobel Prize for peace has been awarded this year to the International Physicians for Prevention of Nuclear War. Having recently had a public disagreement with the Australian section of that organisation, I make some points about it. In passing I say that not all the winners of the Nobel Prize for peace have been extremely peaceful people. Previous winners in the last 30 years or so have included George Marshall, Le Duc Tho, the Foreign Minister of North Vietnam, and Menachem Begin of Israel. Of course, I applaud the work of most recipients. I refer to my controversy with the organisation in Australia. Professor Ian Maddocks is the Vice-President of the Australian section, and in the Australian Dr of 6 September he said: Dr Klugman's letter . . . is unworthy of him. It charges the International Physicians for Prevention of Nuclear War with being `pro-Soviet', `sponsored by the Soviet government', and directing all its criticism at the US and the other democracies. He then goes on with a discussion of what the organisation has done. My reply to that particular letter said: We are of course all opposed to nuclear war and its consequences and in the democracies we even, oppose conventional wars. The fact that the Soviet and other Eastern Bloc affiliates are government organisations presenting the Soviet view, whilst the other affiliates represent well-meaning `opponents of nuclear war' gives the former a huge advantage. I believe in multilateral verifiable disarmament, which is fairly easily verifiable in open societies, not so easy in the closed societies. Currently the USSR portrays the Strategic Defence Initiative of the US as an extension of the arms race to outer space and threatens to stop the Geneva talks. Your appeal to the US/USSR echoes this. That is the appeal by the organisation. The letter continued: In fact a successful SDI would be the only realistic method of rendering nuclear missiles impotent. The USSR currently has a huge advantage in numbers of nuclear warheads. It therefore wishes to `freeze' current numbers. Your appeal echoes this. Please get briefings from our experts in the Department of Foreign Affairs before attending international conferences. Unlike the Soviet delegates you need not express those views at the conferences, but being aware of the issues could make you more effective negotiators. Don't allow your good intentions to be used by Soviet PR manipulators. I now refer to the reaction by the Soviet Union to the award of the Nobel Prize this year. I quote from an article in the Canberra Times yesterday, which stated: MOSCOW, Saturday-The Soviet media promptly reported yesterday's award of the 1985 Nobel Peace Prize to International Physicians for the Prevention of Nuclear War, indicating Soviet pleasure that cardiologist Professor Yevgeny Chazov had been honoured. The official news agency Tass reported the decision of the Nobel Committee less than two hours after it was announced in Oslo, quite quickly compared with Soviet treatment of past peace prize awards. . . . The Soviet Union has paid little attention to the award since dissident Mr Andrei Sakharov won it in 1975, but diplomats said the Government would be pleased by the recognition of the campaigning of Professor Chazov, a leading spokesman for Kremlin views on nuclear war. Of course, he is a member of the Central Committee of the Soviet Union and is portrayed as being an objective man in this organisation. I quote from the Sydney Morning Herald today: He is the Soviet Union's most prominent cardiologist and heads the largest heart centre in the country. It states that he is chief of the fourth administration of the Ministry of Health, which treats the Soviet leadership. The article continues: He has become a major spokesman against nuclear war inside and outside the Soviet Union. He has travelled widely and has written frequently for the Soviet media. In his position as the Soviet co-chairman of the organisation, Professor Chazov often strikes a stance as a man of medicine independent of the Soviet Government. But he has been a full member of the Central Committee of the Communist Party since 1982, and his speeches, while less obviously one-sided than most made by Soviet spokesmen, have nonetheless leaned against the US. So much for the evenhandedness of the organisation. Mr SPEAKER —Order! The honourable member's time has expired. Mr DOWNER(Mayo)(10.45) —I rise tonight to talk about the concept of ministerial responsibility, which as honourable members know is a central part of the operation of the Westminster system. As honourable members know also, ministerial responsibility takes two forms. Firstly, there is the question of individual ministerial responsibility, which I will not discuss tonight. The second form is collective Cabinet responsibility. As J. A. Pettifer in his famous book House of Representatives Practice pointed out, collective Cabinet responsibility is `central to the workings of responsible governments'. He said: . . . it is required by convention that all Ministers must be prepared to accept collective responsibility for, and defend publicly, the policies and actions of the Government or else resign. I draw the attention of the House to an article which appeared in the Adelaide Advertiser on 31 August 1985. I am sure that the Minister for Social Security (Mr Howe) will be particularly interested to hear the points made in this article. I quote from the article: The Federal Primary Industry Minister, Mr Kerin, yesterday attacked his Government's assets test as `discriminatory'. Mr Kerin said he recognised the test disadvantaged many people living in rural areas, but he had been unable to convince his Government colleagues of the problem. That seems to me hardly consistent with the concept of Cabinet solidarity and ministerial responsibility. The article continues: . . . Mr Kerin conceded that the assets test contained fundamental discrimination against some country dwellers. He said the test had . . . clearly hit many country people because of the high capital value of their properties. `There is insufficient allowance in the assets test for the discrepancies between the value of a dwelling on a city residential block and a rural holding,' he said. `I have recognised this for a long time but I can't convince my colleagues on that'. That seems to me to be a very clear case of an absolute and typical breach of ministerial responsibility. Once more I remind the House of what Pettifer said: If a Minister is not prepared to support the actions of a government, he should resign. If the Minister were to be consistent, instead of going out into the community and attacking the policies of the Government in a way which is consistent with the policies of the Opposition, he should resign. It is particularly interesting to note- Mr Howe —He is not the President of the Party. Why don't you quote Valder? Let us hear what the President of your Party says. Mr DOWNER —I can understand the Minister hitting the panic button at this stage. One should add that not only has the Minister for Primary Industry (Mr Kerin) been deceiving the community on this issue, but so has the honourable member for Grey (Mr O'Neil), who travelled with the Minister on that occasion. He told the South Austalian people that he believed it was inevitable that further changes would be made to rectify assets test anomalies. He said that in August, and in September the Minister for Social Security and the Prime Minister (Mr Hawke) both told this House that there would be no amendments to the assets test to help rural people. Not only should the Minister for Primary Industry resign for a breach of Cabinet solidarity, but the honourable member for Grey also will have a fair amount of explaining to do when he faces his electors in two years time. Mr Robert Brown —I take a point of order, based on two parts of the Standing Orders. Firstly, I refer to the requirement that when a member is quoting from a newspaper article of that kind, making accusations against another member of Parliament, on the basis of that he should be in a capacity to guarantee the authenticity of the report. Secondly, when serious charges of that kind are made against a Minister they should be raised by way of a substantive motion. I submit that on both of those grounds the honourable member is out of order. Mr SPEAKER —Order! There is no substance to the second point. All that is necessary is for the honourable member to verify that it was from the newspaper, which the honourable member has done. Mr DOWNER —The Labor Party is in a panic about the policies being pursued on this occasion by the Minister for Primary Industry; the Minister who described Treasury and Department of Finance officers on another occasion as `crazy and dishonest'. He said he was exasperated by them and that they were a cause of the rural crisis. The Minister was condemned for this by the Treasurer (Mr Keating), but that shows once more a quite arrogant breach of the concept of Cabinet and ministerial responsibility. Bearing in mind those breaches, I believe the Minister for Primary Industry should resign. Mr SPEAKER —Order! The honourable member's time has expired. Mr HOLLIS(Throsby)(10.50) —On 17 September the honourable member for Parkes (Mr Cobb) presented to this House one of the most powerful and persuasive arguments that I have yet heard for the retention of the Human Rights Commission. If I ever wondered about the worth of the Commission or the importance of its work, then he has dispelled my last lingering doubts. I refer, of course, to his ill-considered and factually inaccurate attack on the Commission- Opposition members interjecting- Mr HOLLIS —And the honourable member for Parkes has been informed about this contribution, so Opposition members need not start jumping. What does this attack represent? Mr McGauran —On a point of order, Mr Speaker: You may or may not be aware that the honourable member for Parkes (Mr Cobb) is recovering in hospital today from a serious operation in relation to an injury which occurred last Saturday. If the honourable member persists- Mr SPEAKER —Order! That is not a point of order. Mr HOLLIS —It represents an attack by the powerful and advantaged of our society upon the powerless and disadvantaged. It is these people-those who, to varying degrees, are the powerless, the disadvantaged and discriminated-against-who are most in need of the Human Rights Commission. It is, of course, nonsense to suggest, as the honourable member for Parkes would claim, that the Commission is seeking `to break down our traditional way of life'. What, in fact, the Commission seeks to do is to defend and strengthen one of our nation's most cherished ideals-namely, that everyone in our society, without exception, should get a fair go. On the question of the Queensland Government's electricity supply legislation, I would suggest that the Human Rights Commission finds itself in excellent company with the many well-known and respected church people of that State. In August of this year it was my privilege to listen to Father Brian Gore at Wollongong Town Hall. During his address, he quite rightly likened the Queensland Government's repugnant legislation to the draconian and repressive legislation of the Philippines. As Father Gore was quick to point out, the two bodies of legislation have much in common; in both cases they constitute a violation of the right to freedom from forced labour, of the right to privacy, of the right to association and of the right to free speech-and these are the very same terms with which the Human Rights Commission criticises the Queensland legislation. The honourable member for Parkes claimed that the International Covenant on Civil and Political Rights was drawn up by overseas socialist countries. That is simply not true. If he had taken the trouble to examine the proceedings of the United Nations General Assembly in 1966 he would be aware that the Western group had a majority and that, in fact, there was considerable resistance to the Covenant from the communist states. I turn now to the matter of `Irish' jokes and the comments of Professor Blainey on Asian immigration. Again, had the honourable member for Parkes done his homework properly and read the Human Rights Commission's report No. 7, `A Proposal for Amendments to the Racial Discrimination Act to Cover Incitement to Racial Hatred and Racial Defamation', and had he referred to subsequent speeches by both the Chairman and Deputy Chairman of the Commission, he would know that it has been made quite clear that neither Irish jokes nor Professor Blainey's comments, no matter how tasteless they may be, would be subject to the Commission's proposals. He also alleges that the Commission has recommended `that any illegal immigrant couple who have a child in Australia be entitled to permanent residence'. Again, he obviously has not bothered to check the facts. I would advise him to read three of the Commission's reports-Nos. 8, 10 and 13. These reports contain no invitation to circumvent the law but rather an invitation to apply it more humanely or else to change it. On the question of the Queensland community services legislation, the Human Rights Commission, in its report No. 9, in fact commended the forward steps taken by the Queensland Government in relation to Aborigines living on reserves, but encouraged further action with reference to the right of Aborigines to vote in local government elections and to have control of their own affairs on their own land-surely not too much to expect in a democratic society such as ours! That the Commission has advertised `offering bribes to school teachers' is a most extraordinary and mischievous piece of misinformation. What, in fact, the Commission has done is to advertise throughout Australia-and not simply in Queensland, as the honourable member for Parkes would imply-for teachers interested in receiving small grants to enable experimental use of its teaching materials entitled `Teaching for Human Rights'. The response has been quite favourable. All over Australia, with the exception of the Queensland Government school system, but not the Queensland independent and Catholic school systems, teachers are using the kit and evaluating it, and it is receiving favourable comment from both teachers and students. As long as the Human Rights Commission is subjected to such ill-considered and biased attacks, we obviously have need for such a Commission. It is only when such attacks have long stopped that I will become convinced that Australia has finally achieved its goal of becoming the land where everyone, without exception, can get a fair go, and no longer needs a Human Rights Commission. Mr GOODLUCK(Franklin)(10.55) —The other night I said that Australia had the second lowest price of petrol of any of the Organisation for Economic Co-operation and Development countries. I think I said that the price was 51c a litre; in fact it is 55c a litre. I hope that that figure can be changed. If anyone takes me to task about it they will know that it is right. I have been watching the performance of honourable senators. One of the grievances I have at the moment is that we do not have a Tasmanian senator on the front bench. I am watching very closely the performance of all honourable senators because I have always had a firm notion that senators are elected by their party; they are not elected by the people. Sometimes I do not think they are subject to all the problems that a member of the House of Representatives has. That worries me. If they are elected to this Parliament and show an exaggerated opinion of their ability, if they stick their heads in the air and do not get down to the level of the ordinary average person, I watch them very closely. I have been watching one of the Australian Democrats very closely. He was elected by the Tasmanian people and I am ashamed that he does not have the fortitude to stick up for them. In his American way he once said that he was not able to come back at me because he did not have parliamentary privilege. He now has parliamentary privilege. He is a member of the Senate and if he continually denigrates the Tasmanian people for his own benefit and if he continues to run them down and run down the system, he will cop it every inch of the way. The other week I saw him defending Daintree in Queensland. He should start looking after the problems of the Tasmanian people, such as the high rate of unemployment and many others. That is the reason he was elected to the Senate. It was not to go around the country trying to change the views of people or pretending to be a trendy greenie. His job is to look after the Tasmanian people and that goes for all of the other Tasmanian senators. I now refer to an Australian Labor Party senator. I never get involved in personal stuff. I will hoe in the boot if I think it is necessary but honourable members have never heard me run down a person in the sense of the words. Do honourable members agree? They all agree with that. A poor, innocent State fellow brought back a pair of socks from overseas and I notice that he has been taken to task for bringing them back in a courier bag. We have some damned important things to do in Tasmania so I suggest to that dear senator that he leave the matter alone because if he does not he will cop it in Tasmania. He is not in the State Parliament any more. We do not keep off our boxing gloves all the time. We will put them on and he will start to cop a bit of the wrath. The other person I refer to is a State member of Parliament and his name is Bob Brown. They call him the angel of the conservation movement. He has done enough harm to Tasmania. I think he should start to leave it alone and look after the interests of Tasmanians. One can win glory and fame by running around this country talking to other people but Tasmanian members of Parliament have a job to do and that is look after the Tasmanian people. They should get on with it. If I am ever reincarnated as a politician I would like to come back as a senator. Mr McGauran —Why? Mr GOODLUCK —Because they do not have to put up with all the stuff I have to put up with day after day. Most honourable members have to do a certain amount of work and most whom I know do a dashed lot of work. They have to contend with all the problems in their electorate but some honourable senators-not all of them- seem to walk- Mr Howe —Mr Speaker, I raise a point of order. The honourable member is reflecting on the character of members of the other chamber. Mr SPEAKER —Order! I have been listening very carefully to the honourable member. There is a rule about offensive words being spoken about members of either House. So far the honourable member for Franklin has not offended in uttering offensive words. Mr GOODLUCK —I would not offend anybody, Mr Speaker. I have concluded my speech. Question resolved in the affirmative. House adjourned at 11 p.m. The following notices were given: Mr Conquest to move- That this House- (1) condemns the Federal Government's decision to cease payment of family allowance for students on reaching 18 years of age, and (2) calls on the Government to reverse this decision immediately. Mr Conquest to move- That this House- (1) condemns the Federal Government's failure to honour the Prime Minister's 20 February 1983 election promise to abolish the added cost for country people imposed by sales tax calculated on the freight component of goods, and (2) deplores the failure of the Federal Treasurer to implement the necessary legislation to remove the discriminatory 20% sales tax on carbonated beverages. The following papers were deemed to have been presented on 14 October 1985: Lands Acquisition Act-Statement of lands acquired by agreement authorised under sub-section 7 (1). Quarantine Act-Determination fixing fees pursuant to section 86E, dated 1 October 1985.