Tuesday, 7 October 1986 Madam SPEAKER (Hon. Joan Child) took the chair at 2 p.m., and read prayers. Mr HAWKE(Wills-Prime Minister) —Madam Speaker, I move: That this House expresses its deep regret at the death on 28 September 1986 of Sir Robert Helpmann, CBE, dancer, actor, choreographer, director and producer, places on record its appreciation of his long and meritorious service to the Australian Ballet and tenders its profound sympathy to his family in their bereavement. I wish to pay tribute to a great Australian, Sir Robert Helpmann, who died in Sydney on Sunday, 28 September. It is only in exceptional circumstances that motions of condolence have been moved for distinguished Australians who have not sat in this House. Sir Robert Helpmann was a distinguished Australian whose career as a dancer, choreographer, stage, film and theatre actor, and stage and film director was one of the richest, liveliest and most productive in Australia's cultural life. Robert Murray Helpman was born at Mount Gambier, South Australia, on 9 April 1909. At the early age of five he began ballet classes. His teacher, Nora Stewart, told his mother: A child is either born a dancer or he isn't. Bobby is, and will go much further than I can take him. Madam Speaker, there is no doubt he did. He achieved fame in Europe and America and his singular talent was recognised and applauded not only by his audiences but also by his peers. His collaborators on the stage and in film included such illustrious names as Alicia Markova, Dame Margot Fonteyn, Rudolf Nureyev, Sir Laurence Olivier, Michael Powell, Emeric Presburger, Nicholas Ray, Katharine Hepburn and Sir Frederick Ashton. There is not sufficient time here to list his achievements individually. There were too many successes, particularly in his efforts to produce new and exciting dance work. There is time, however, to remind honourable members that Sir Robert Helpmann left Australia in 1932 at a time when opportunities to develop his art and his craft were limited, if not non-existent. By sheer hard work he rose to the top of his profession. He returned to Australia only in the mid-1950s, then to have a major influence over the development of ballet in Australia and to make contributions to our films, theatre, television and even, on one occasion, our pop music industry. In 1964 he was made a Companion of the Order of the British Empire for his outstanding contribution to ballet. Other honours bestowed on him were a Queen Elizabeth II Coronation Award in 1953 and Australian of the Year award in 1966. He was made a knight bachelor in the 1968 New Year's honours list. He gave to Australians the benefits of his imagination and skill. As Australia's cultural life has broadened and we have produced more playwrights, painters and directors of international standing and repute, no one should underestimate Sir Robert Helpmann's role in the development of the growing maturity of Australia's art and culture. He blazed a trail for our artists and remained active over many years. He was working virtually up to the time of his death, constantly involved in plans for dances, plays and films. No doubt he was actively involved in preparing to solve the problems each work presented. His work was summed up by his great friend Katharine Hepburn who said these words of him: He can set himself on a trail. And follow it. Step by step. Mountain by mountain. Jungle by jungle. Swamp by swamp. And he will get there. He will keep-a-going. And he will get there. Sir Robert Helpmann brought great joy and satisfaction to the millions who saw his work. He demonstrated to the world the diversity of this nation's talents and capabilities. His memory will live on in his films and his choreography. It will also live on through the inspiration such a brilliant career offers to those Australian artists who will follow him. On behalf of the Government and all Australians, I extend to his family our condolences in their bereavement. Mr HOWARD(Bennelong-Leader of the Opposition) —The Opposition supports the motion of condolence moved by the Prime Minister (Mr Hawke). Sir Robert Helpmann is to be praised and remembered for his valuable contribution to the arts both in Australia and internationally. In a career that spanned more than 50 years, he was renowned as a dancer, choreo- grapher, producer and actor working in the field of ballet, opera, theatre and film. At the age of 14 he studied ballet under Anna Pavlova and members of her touring company. In 1924 he joined J. C. Williamson as a soloist; in 1933 he moved to London and became chief male dancer and choreographer with the Vic Wells Ballet, forerunner of the Sadler's Wells and Royal Ballet. It was here that he formed his renowned dancing partnership with Dame Margot Fonteyn. He started acting with the Old Vic in 1937, performing in such roles as Oberon in A Midsummer Night's Dream and Hamlet. In 1950 he left Sadler's Wells for an acting career and by the mid-1950s had established himself as a director of plays at the Old Vic and opera at Covent Garden; as an actor for cinema and theatre; and as a dancer and as a choreographer for films and stage. As the Prime Minister said, he returned to Australia in 1955 and together with Dame Peggy van Praagh he formed the Australian Ballet 10 years later. He initially shared joint responsibility for its artistic direction with Dame Peggy before becoming its sole artistic director. His fertile imagination contributed to his brilliant choreography of such productions as the Display and the Merry Widow. His direction of the Adelaide Festival in 1970 is regarded as the most successful staging of that festival to date. His last performance was as the Red King in the ballet Checkmate, a role which he created 37 years ago. That brief sketch of his outstanding career gives some idea of the dimension of his contribution to the artistic life of this country. He encouraged the staging of full scale productions of ballet, opera and drama in venues which attracted those unwilling or unable to attend the arts at traditional venues. He once said: I would do everything in my power if I was in a position to do so to bring the ballet to a more general public-somewhere like the club. He was in favour of corporate sponsorship of the arts and at times he was critical of the waste of government funding by arts administrators. On one occasion he said: When I started there was no government sponsorship. The Royal Ballet, the National Theatre and the English Opera were all started by Lillian Bayliss and she never had a grant at all. What she did was present things to the public that they wanted to see. For those who had the privilege of seeing Sir Robert Helpmann perform, he will be remembered as an artist of international stature. As an Australian he will be remembered as a person who pursued and achieved excellence in his field of chosen endeavour. The Opposition warmly supports the motion. Mr SINCLAIR(New England-Leader of the National Party of Australia) —I rise to join in the motion moved by the Prime Minister (Mr Hawke) and supported by the Leader of the Opposition, the honourable member for Bennelong (Mr Howard). In doing so I think it is worth while considering two particular aspects of the life of Sir Robert Helpmann. In the motion moved today and in the speeches made by the Prime Minister and the Leader of the Opposition, we have considered particularly Sir Robert Helpmann's success in his later years of life. But to me the more important part is the inspiration which he gave to so many other Australians who, though they might be born in lesser circumstances and perhaps do not initially enjoy the opportunities offered in the big cities, nonetheless, can achieve greatness. Robert Helpmann began his life as the son of a stock and station agent in Mount Gambier. It was with his mother there that he began his dancing career. Although he left Mount Gambier, I understand, at the age of five, his early promise was seen by those who taught him. It was certainly recognised by his mother and was equally discouraged, at first at least, by his father. I think the significance of Sir Robert Helpmann's life was the fact that, in spite of those very humble beginnings and in spite of the fact that for the son of a country town in 1909 to seek to become an international dancer or choreographer or dramatist would have been probably at the absolute end of any possible rainbow, Sir Robert Helpmann not only achieved greatness, but he has passed the opportunity for greatness on to others. In supporting this motion, I commend all those who have aspirations in the theatre, the arts or whatever field to look at the life of Sir Robert Helpmann and to say: `If he can do it, so too can I'. It is in that respect that I believe that Sir Robert Helpmann has left a particularly notable mark for all Australians to imitate and perhaps to take from him some lesson for themselves. It is worth remembering that it is said of Sir Robert Helpmann by Robert Macklin in his book 100 Great Australians: Robert Helpmann's most important contribution to Australian life has been as a bridge between the finest elements of European theatre and culture, and those of his homeland. In the process, by his own performances, he has given pleasure to many thousands around the world. His has been an extraordinary theatrical career. For 20 years he left Australia but he returned and became very much once again part of this country. In his later years, while active even until the days of his final illness, he certainly contributed as an Australian wherever he was. My own admiration of Sir Robert Helpmann is based on a combination of his achievement and the fact of his retention of his pride in his nationality. So it is that I see him as a great ambassador for this country. I extend the sympathy of the members of my Party to his brother Max, his sister Sheila and to his thousands and thousands of friends and fans. He was truly a great Australian. Mr COHEN(Robertson-Minister for Arts, Heritage and Environment) —Undoubtedly, since we became a nation, Sir Robert Helpmann was one of the great figures in Australian theatre. He ranks amongst the greatest names both nationally and internationally. He was our premier performing artist for the last half century. He played a major part in shaping Australia's artistic landscape and in promoting international recognition of Australia's cultural life. I am delighted that the House has seen fit to honour one of our greatest artists in this way-a distinction that is not given to many who are outside the political arena. Most Australians would be aware of Sir Robert's standing in the arts world, though not necessarily of the awesome breadth of his artistic talent. It was said earlier today that, over the past 20 years, Sir Robert was intimately involved with the development of the Australian ballet. He also promoted overseas tours of the company, choreographed ballets and appeared in mime roles. In 1973, with Nureyev, Sir Robert directed a film of the Australian Ballet's production of Don Quixote and appeared in its title role. He made excellence and professionalism the hallmark of his performances and demanded no less from the Australian Ballet. He contributed greatly to the Ballet's becoming acknowledged internationally as a leading national ballet company. Australia's vigorous dance life is now the envy of many nations and we boast a range of companies focusing on a number of dance forms, including traditional, modern and Aboriginal. One should not underestimate the impact of Sir Robert Helpmann's work and enthusiasm in creating the fertile soil for the seeds of such creativity to grow. He was also involved in film over a number of years. He began his film career in 1942 in One of Our Aircraft is Missing. He starred in the film version of The Tales of Hoffmann and in 1948 choreographed and starred in the classic ballet film Red Shoes opposite Moira Shearer. His contribution to Australian film included notable roles in The Mango Tree and Patrick. He also worked hard to bridge the cultural and generation gap. In all, he wished to entertain, whether this was as an artistic dancer for the Australian Ballet or as a singer of surfing songs on the popular teenage television program Bandstand. No one could have accused Sir Robert of lack of imagination or lack of preparedness to broaden his artistic horizons. It was a great honour for me to be asked to act as a pall-bearer at his funeral last week. My only hope is that the Parliament and the Government can find some suitable way to honour the name of Sir Robert Helpmann. I add my sympathies to those that have already been expressed to his family. Mr CONNOLLY(Bradfield) —This motion of condolence, coming so soon after the State funeral of Sir Robert Helpmann in Sydney last week, is a very fitting honour from this Parliament and the people of Australia to Sir Robert Helpmann, who was undoubtedly a very great Australian. He was not just a dancer, choreographer, actor and director; he was more than that; he achieved excellence in all that he did. He set out to achieve excellence as the objective of his personal endeavour. He used his infinite imagination in so many fields throughout his life. His career spanned some 50 years. He demonstrated to the people of Europe, particularly of the United Kingdom, as well as in his home country, Australia, that international boundaries are not a barrier towards personal achievement. In his career of some 50 years, he was one of the very rare personalities who excelled in virtually every field that he entered. He was described by the administrator of the Australian Ballet, Mr Noel Pelly, as the most creative personality Australia has produced for the last 60 years. I am sure that would certainly apply to his role in so many aspects of the arts. Sir Robert was of great influence in the development of the Australian Ballet, which is now a company which has brought great credit not only to its cause de ballet but, above all, to this nation. It will remain as a lasting legacy of his personal achievement and of the contribution that he made to Australia. His ballet training commenced in the United Kingdom in 1933. During his career he danced with Dame Margot Fonteyn in a partnership which was internationally acclaimed. He joined the Vic Wells ballet company as a student dancer. Later he danced with the Sadler's Wells company and with the Royal Ballet company. In the field of acting he was noted for his roles as Oberon in A Midsummer Night's Dream, as Hamlet, as Don Quixote in Australia and in the Merchant of Venice. During the 1940s and 1950s he was particularly noted for his roles in the films Red Shoes, Tales of Hoffmann and Chitty Chitty Bang Bang, from which so many children have found so much pleasure over the years. His production of Madame Butterfly and the roles that he played for the Covent Garden Opera Company have placed him amongst the foremost in the world in that field. Australia has lost a truly great artist. But, in his passing, Sir Robert has left for those artists who will follow in his footsteps a standard of excellence which is well worth emulation. Question resolved in the affirmative, honourable members standing in their places. Mr HAWKE(Wills-Prime Minister) —I wish to advise honourable members that the Treasurer, Mr Keating, will be absent from Australia on Government business until 14 October. During his absence, the Minister for Immigration and Ethnic Affairs, Mr Hurford, will act as Treasurer. The Minister for Science, Mr Barry Jones, will be absent from Australia on Government business until 13 October. During his absence, the Minister for Communications, Mr Duffy, will act as Minister for Science. As a matter of courtesy, I mention that the Minister for Transport and Minister for Aviation, Mr Peter Morris, will be absent on Government business from Question Time, as will the Minister for Sport, Recreation and Tourism, Mr John Brown. Mr SINCLAIR(New England-Leader of the National Party of Australia) —by leave-I move: (1) That this House congratulates the Royal Australian Navy on the seventy-fifth anniversary of its foundation, noting with deep appreciation: (a) the vital contribution of the RAN to the defence of Australia in two world wars and conflicts in Korea and Vietnam; (b) its essential role in the preservation of peace in our region and, through Australian participation in the Western Alliance, around the globe; and (c) the sacrifice of the men and women of the RAN who have given their lives or suffered injury or hardship in the service of their country. (2) That this House extends its thanks to the naval forces of our allies for their participation in the Royal Australian Navy's seventy-fifth anniversary celebrations, offers all personnel involved the warmest welcome to Australia, and thanks the people of Sydney for their warm and generous reception to the ships and sailors of the RAN and allied navies present there over the past week. Mr BEAZLEY(Swan-Minister for Defence)(2.21) —I have much pleasure in seconding the motion moved by the Leader of the National Party (Mr Sinclair). The mover, the Leader of the Opposition (Mr Howard), the Prime Minister (Mr Hawke) and I were the beneficiaries of the Royal Australian Navy's hospitality in a truly excellent week for the service last week. The people of Australia, via the people of Sydney, demonstrated a degree of affection that surpassed the expectations of any of the participants in those events. Question resolved in the affirmative. Mr CARLTON —Is the Acting Treasurer aware that on 8 August and again on 24 September the Treasurer said that there would be no-repeat no-changes to the administration of the fringe benefits tax? Is the Minister aware that last Friday the Prime Minister said that the administration of the fringe benefits tax would be reviewed? Which is the correct version? Mr HURFORD —As this is my debut on the subject of the fringe benefits tax in Question Time, I thought I would take as my text the following words: Fairness demands that employees who are paid solely in cash-and most Australians are-should not be asked to pay more tax and thus effectively subsidise those whose income is obtained partly in cash and partly in the form of valuable benefits of other kinds. That text comes from none other than then Treasurer Howard in a media statement on 11 July 1980. I could not have said it better myself. Indeed, the Treasurer, the Prime Minister, and every Labor member in this House have been saying that this principle is absolutely essential to fairness and equity in our taxation system. We are not resiling one iota from that principle. The Treasurer, the Prime Minister and other Ministers have said, and I say now, that we will look at the imposition of the administration in this area; we will monitor it constantly. We had experience when we brought in another reform, the prescribed payments tax, in applying monitoring in the face of an enormous attack from the other side. We made changes then. At the moment we have no announcements to be made about administrative changes, but I repeat that we will not be withdrawing or resiling one iota from the principles of this tax. Mr BLANCHARD —Can the Prime Minister give information on the effectiveness of the Government's wages policies over the last three years compared with other countries? Mr HAWKE —I refer the honourable member and all honourable members to statistics published in the September issue of the Treasury's Round-up of Economic Statistics. These are very interesting. Table 3 on page 66 shows that over the three years, 1983 to 1985, real compensation per employee fell by 4 per cent in Australia. I repeat that: In the three years, 1983 to 1985, in Australia real compensation per employee fell by 4 per cent. That compares with rises of 2 per cent in the United States, 3.8 per cent in Japan, 2.5 per cent in Germany, 2.2 per cent in France and 6.5 per cent in the United Kingdom. Quite rightly, the Treasurer, during his visit to the United States, has been pointing out these magnificent achievements because he realises, as do commentators in this country and overseas, that those achievements listed in the September issue of the Treasury's Round-up have underpinned the recovery in employment to date in this country since we have come into office. The statistics provide a very firm basis on which to build for the future. These are, indeed, achievements of which all Australians can be proud. After the debacle of economic management which characterised our predecessors, these statistics indicate that Australia is now putting its house in order and making the adjustments which are sorely needed to trade our way out of the current straitened economic circumstances. It is interesting to note that the Leader of the Opposition, instead of lauding these achievements, has been seeking to mislead overseas investors by saying that, when the Treasurer points out these facts, he is not putting the position properly. I suggest that the Leader of the Opposition would do well to heed those statistics in the Treasury publication. While he looks at those figures for performance in this country during the last three years, I suggest that he would also do well to cast his eye over the three years before 1983 because this is what he will find: Over the three years prior to 1983, under his stewardship, the real compensation per employee in this country rose by more than 10 per cent. I ask you, Madam Speaker, to make the comparison. In three years under this Government there has been a decline of 4 per cent; in the last four years that the Leader of the Opposition was Treasurer there was an increase of 10 per cent. Not only was that a disastrous increase for this country, but also the comparison with other countries is of particular interest. That increase of more than 10 per cent in Australia was more than double the next highest increase in the major industrialised countries which I have listed. It compared with no increase in the United States, a small fall in Germany, and only 2.4 per cent increase in Japan. The reality is that the current Treasurer of Australia is in New York properly pointing out to people there-as we are in this country-Australia's substantial performance in relation to the fundamentals of economic management. The Leader of the Opposition is terribly concerned because when he was in New York just three months ago, in July, he said with some considerable degree of pleasure that the bad economic times in Australia would suit him. Honourable members will remember that he said: `The times will suit me'. He was a man who gloated over the difficulties confronting this country, so he is terribly disturbed that three months later the signs are becoming increasingly evident that the sound economic management provided by this Government is addressing the fundamental problems that we inherited, and will put this country on the way to trading its way out of the economic problems confronting it. The Leader of the Opposition looked for bad economic times; he has nothing positive to put to the people of this country; he had hoped that by default and through bad economic circumstances, he might get into office. As he sees the evidence increasing that he has no chance of acquiring office in that way, he despicably tries to talk down his country. Mrs SULLIVAN —I refer the Prime Minister to the difficulties in everyday life faced by invalid Australians such as quadriplegics, those suffering the after effects of strokes and those who are too old to look after themselves. Will the Prime Minister confirm that it was the intention of his fringe benefits tax to force incapacitated Australians, including invalid pensioners, to pay tax on accommodation and meals provided to paid live-in helpers? Will the Prime Minister spell out where is the rort, ramp or rip-off, to use the words of his Treasurer, in such a situation? Does the Prime Minister consider such live-in helpers to be tax evaders and rip-off merchants? Mr HAWKE —I thank the honourable member for her question because in these last few days the sort of circumstances to which she referred has been brought to my attention. Opposition members-Oh! Mr HAWKE —All I can say is that quite clearly it has not been brought to the attention of honourable members opposite before now; otherwise, presumably, we would have had questions about it. Are they derelict in their duty? They have seen this for weeks and weeks and only now are they asking a question about it. I repeat that this circumstance has been brought to my attention. I say quite unqualifiedly: No, this was not the sort of situation that the fringe benefits tax was intended to encompass. In terms of the answer that has been given by the Acting Treasurer, I simply say that that is one of the things at which we will be looking. So that we can put into context the observation that was made on the fringe benefits tax by my colleague the Acting Treasurer, let us pick up the current position of the Leader of the Opposition. Honourable members opposite want to talk about the fringe benefits tax as though there is some confusion. Let us tell the House and the people of Australia the latest offering of the Leader of the Opposition, which was proffered on the steps of Parliament House this morning. We had been led to believe before by, for instance, the Deputy Leader of the National Party of Australia and other more principled people in the Opposition that they did not oppose the principle of the fringe benefits tax; it was the question of its administration that they opposed. What did the Leader of the Opposition say this morning on the front steps of Parliament House? When he was questioned about the principle of the tax he said: No, no, I, well the principle of the tax. Look, there are two issues about it. The principle of it is wrong and so is the administration. No wonder the people on the other side of the House are absolutely rent with confusion. Some of them are saying that of course they want tax avoidance to be wiped out. The Deputy Leader of the National Party has been quite honest about it and has said that of course it is improper that we should have an avoidance of the proper responsibilities of paying income tax; but not the Leader of the Opposition. At last he has been nailed. He said: `We are opposed to the principle of the fringe benefits tax'. I remind the House again of what the Acting Treasurer said. Let the House remember the words of the man of principle in 1980 and compare them with the words that he spoke this morning, in 1986. In 1980 he said: Fairness demands that employees who are paid solely in cash-and most Australians are-should not be asked to pay more tax and thus effectively subsidise those whose income is obtained partly in cash and partly in the form of valuable benefits of other kinds. There you have it. On 11 July 1980 the Leader of the Opposition said that there was a question of principle involved. He was saying that a tax should be paid and also making the point correctly then that, to the extent to which people derived part of their remuneration in other than cash, not only did they avoid tax but also obviously, as a matter of logic, that imposed a greater burden on the mass of ordinary Australians. This man-Honest John-then said that of course there is a principle involved and that it would be wrong in principle not to impose such a tax. Where have his principles gone? This morning on the front steps of this House he said that the principle of the tax is wrong. Madam Speaker, the principle of the fringe benefits tax is overwhelmingly correct. This is why this Government will adhere to the principle of the tax, but we will take account of the sorts of situations that have been brought to our attention by the honourable member for Moncrieff. Ms JAKOBSEN —Will the Minister for Health advise the House of progress on signing the national food standards agreement? Dr BLEWETT —I thank the honourable member for Cowan for her question. I am able to report to the House that the Commonwealth, States and Northern Territory have now signed a national food standards agreement which, on the estimate of the food industry, will save Australians upwards of $50m a year. These savings will be made by the elimination of the wasteful need for industry to comply with different food standards and labelling requirements in different States. It represents the most significant breakthrough that we have had in food legislation nationally. The agreement establishes a mechanism for uniform adoption of food standards by States and territories and for ensuring that associated legislation is uniformly updated. A national food standards council, which will comprise the Ministers for Health of the Commonwealth, States and Territories, will be set up. Its task will be to streamline the adoption by the States and Territories of model food standards regulations which are developed by the National Health and Medical Research Council in consultation with the States, Territories, industry, consumers and other interested bodies. I point out that the gurus of the New Right and their allies on the Opposition benches frequently talk about the need to reduce regulation in this society. No single act could contribute more to a reduction in regulation than the introduction of uniform standards affecting business activity in this society, because it will remove the need for business to meet different standards and different labelling requirements in each State. This Government has acted and will continue to act in this matter. Indeed, I believe that this is the first of many steps to achieve this simplification across the country. Mr SMITH —Is the Prime Minister aware that the magnificent non-profit organisation, the Royal Society for the Prevention of Cruelty to Animals, last year dealt with 264,500 lost, injured, abandoned or cruelly abused animals throughout Australia? The Prime Minister should be aware that the RSPCA regional inspectors are paid very little money, but 17 of them get free accommodation in homes owned by the RSPCA. Those homes are used as 24-hour animal shelters. Given that, is it true that the Government will force the RSPCA to pay around $50,000 in fringe benefits tax this year for accommodation alone? As the RSPCA gets most of its money from voluntary donations, is the Prime Minister happy to see some shelters close and the RSPCA's work of preventing cruelty to animals diminished? Mr HAWKE —I cannot answer for the detailed administration of the fringe benefits tax because, as the Treasurer and I have said on a number of occasions, when a fairly complex piece of new tax legislation is brought in, it will take some time to see the impact of it, how the administration of it will work and whether any substantial, unintended consequences will flow from the application of the tax. We will monitor very closely the operation of the fringe benefits tax-a tax which, I repeat, is broadly accepted in principle by the overwhelming majority of Australians. Mr Howard —Ha, ha! Mr HAWKE —We get this pathetic, hollow laugh from the Leader of the Opposition, but it will do him no good. The fact is that the overwhelming majority of people in this country accept the principle of this tax. The question that needs to be monitored closely, in watching the operation of the tax, is whether any unintended consequences will be involved in the administration of the legislation as it has been passed by this Parliament. I repeat to the House what I have said before: This Government will watch this very closely and, if in the administration of this legislation any unintended consequences are involved, that will be reviewed. Mr GRIFFITHS —Can the Special Minister of State inform the House of progress made with respect to certain extradition proceedings being currently conducted by the National Crime Authority? Mr YOUNG —The National Crime Authority recently achieved the extradition of Bruce Richard Cornwall and his suspected associate, Barry Richard Bull. I am informed that Bull arrived in Australia yesterday, and I understand that he appeared in court on 16 drug and passport offences this morning and was remanded in custody until 3 November. As the charges against both Bull and Cornwall are still to be heard in the courts, it would be inappropriate for me to comment on the nature of the charges. However, it would be remiss of me not to make public mention of the significant efforts of the members and officers of the National Crime Authority in ensuring that the two men suspected of being major figures in the illegal drug trade in Australia are brought to trial. The NCA faced enormous complications with both extraditions, which included the escape of Bull from custody in Austria. His recapture was due in no small part to the investigative skills and efforts of National Crime Authority officers. I should like to reiterate what I have said in the House on so many previous occasions, namely, that the foundation stone of the National Crime Authority is co-operation between the Commonwealth and the States that is based on common goals and mutual professional respect. It is obvious and particularly heartening from the degree of assistance extended to the National Crime Authority by foreign law enforcement agencies in these two instances that such co-operation and respect are not confined to Australia. This Government is thoroughly committed in its resolve to combat organised crime aggressively and effectively. I believe that recent events show that it has created the apparatus to do just that. Mr HICKS —I refer the Prime Minister to the circumstances of miners and farm hands working in remote areas of Australia who have their families living with them. Is the Prime Minister aware of the fact that, if such an employee's young child becomes seriously ill or suffers a bad accident, any employer providing medical treatment for the child, or employer providing transport of the child to a hospital, will be subject to the fringe benefits tax? Will the Prime Minister confirm that the fringe benefit tax legislation was intended to catch these type of payments? If it was not, when will it be amended to exclude them? Mr HAWKE —I refer the honourable member to the answers that I have given to two preceding questions from the Opposition, but I would like to add two comments. First, I cannot answer the question authoritatively and say that that type of payment is caught. I simply say to the honourable member-I accept the integrity of his question-that in the examination that I have indicated will take place as to the application and administration of the legislation and the tax, I shall ensure that the question is considered. My second point is that it serves the Opposition nothing for it to pick out this example, that example and that example without clarifying what it would do about fringe benefits tax. Is it the position of the Opposition that it will have no fringe benefits tax? Opposition members interjecting- Madam SPEAKER —Order! Mr HAWKE —Do not worry about Opposition members, Madam Speaker. Is it the Opposition's position that it will have no fringe benefits tax? Is it the position that it repudiates the position of the Federal organisational leader of the Liberal Party? I remind the House again that he referred to the disease-his word-in this country of fringe benefits tax avoidance. That is what he said in July 1985. He praised this Government and he praised the Treasurer for bringing in legislation to eliminate the disease. Within a matter of days the honourable member for Bennelong-he was not then the Leader of the Opposition-said he agreed with the organisational leader of the Liberal Party; that is, that the Government was right to bring in legislation to eliminate the disease. It is no good honourable members opposite saying that the honourable member for Bennelong has said it is right to bring in the legislation, and then simply giving some examples of people who have been caught, as a result of some unintended consequences. They might have a look at that. I have said what the Government's position is. We will look at the operation of the tax. We will see that there are no unintended consequences and we will see that the administration is improved, if it possibly can be. So the position of this Government is clear. It is in line with that of the organisational leader of the Liberal Party, who says this Government has had the guts to do the right thing. When will the honourable member for Bennelong, in his position now as Leader of the Opposition, have the guts to say what is the Opposition's position? Mr GRACE —My question is directed to the Prime Minister. What is the Government's attitude to the imposition by the United States of economic sanctions against South Africa? Mr HAWKE —The Government warmly welcomes the decision of the United States, taken by an overwhelming bipartisan majority on 3 October, to impose a package of measures against South Africa. I outlined the main provisions of the package to the House on 23 September. The Government regards the emerging consensus on South Africa in the international community as a thorough vindication of the leading role Australia has taken not only within the Commonwealth but elsewhere. I believe that the decision of the United States will reinforce efforts by the international community to achieve the peaceful elimination of apartheid in South Africa. I believe that, just as that, overwhelming bipartisan position has emerged in the United States, it would be very much in the interests of this country and our international reputation if we were to take a bipartisan attitude to the sanctions issue. It is well known that many of the enlightened members of the Opposition wish to change their party policy towards the direction of this Government, and the growing consensus within the West on this issue. Those enlightened members are being frustrated by their parliamentary leaders. It is about time that the Leader of the Opposition and his deputy stopped siding with the reactionaries in their ranks on this matter and gave a lead. Under the leadership of the Leader of the Opposition and his deputy the Opposition is becoming increasingly isolated not only from growing public opinion in this country but also from growing public opinion in the rest of the Western world. Mr HOWARD —I refer the Prime Minister to his new-found concern for the unintended consequences of the fringe benefits tax. I ask whether, in examining those unintended consequences, the Prime Minister will pay regard to the position of a small business proprietor who has to consult the following in order to understand the application of the fringe benefits tax: 139 pages of legislation, 176 pages of explanatory memorandum, two booklets of 69 pages, 14 rulings of 115 pages, pamphlets, Press releases and a videotape. When will the Prime Minister announce the results of his examination of the unintended consequences of the legislation, and is this vast array of research required to be undertaken by a small business proprietor an example of the simpler tax system the Prime Minister promised before the last election? Mr HAWKE —In its monitoring of the situation, to which I have referred, the Government will take into account all that is necessary to ensure these things: Firstly, on the basic prin- ciple of bringing to an end the tax avoidance and ramp condoned by the Leader of the Opposition for so many years, and to which he would return, there will not be a return to that tax avoidance. The situation is that as a result of both the incompetence of the Leader of the Opposition in his time as Treasurer and also his willingness in being compliant in that tax avoidance, the ordinary Australian paid a very much greater level of tax than he or she otherwise would have done. So the guiding principle of this Government in reviewing the operation will be to ensure that that tax avoidance is brought to an end. That will be the first principle. The second principle will be to try to ensure that the administration of the tax is made as simple as possible and, as I said before, that any unintended consequences are remedied. How long that will take-- Mr Nehl —When? Mr HAWKE —It is all right for the honourable member to yell out `When?'-- Madam SPEAKER —Order! The honourable member for Cowper will not do that again. Mr HAWKE —Looking at the question of time, there were 7 1/2 years of neglect by those opposite. They should ask themselves about the question of time. They allowed 7 1/2 years to go by, which meant that the great majority of ordinary Australian taxpayers paid billions of dollars more because they allowed these rorts and ramps to go undetected or unpoliced. We have had the courage, recognised by Mr Valder, to bring in the legislation to bring an end to that. I am not going to say here how long it will take to review the operation. All I can say is this-- Opposition members-Ha, ha! Mr HAWKE —The hollow laughs of those opposite are the product of a guilty man opposite. One can understand his guilt when we compare his clear statement of principle in 1980 with the total abandonment of principle in 1986. We will act as quickly as we can in this area. We promise the great majority of our fellow Australians that they will not be left to the tax avoidance, ramps and lurks which characterise the stewardship of the Leader of the Opposition. Mr MILTON —I direct my question to the Minister for Aboriginal Affairs. Why is the Minister proceeding with the grant of the remaining land in the Alligator Rivers region, stage 2, at Kakadu, land claim which the Northern Territory Government asserts will effectively lock up important resource deposits from future development? Mr HOLDING —I thank the honourable gentleman for his question. I choose to answer for my actions by referring to the history of this particular land claim. The former Land Commissioner, Mr Justice Toohey, reported on this land claim in July 1981. It was then referred for decision to Minister Peter Baume, as he then was. In making his decision, Minister Baume had before him correspondence from Peko-Wallsend indicating the nature of the detriment it believed it would suffer if he proceeded to grant the claim in terms of the recommendation which was made by Mr Justice Toohey. On 5 March 1982, Minister Baume wrote back to the-- Mr Sinclair —Madam Speaker, I raise a point of order. I am not too sure of the status of the papers to which the Minister is referring. Normally papers of an earlier government are not available. Are these public papers or private papers? Mr HOLDING —This is essentially a chronology of the events. I will deal with the question of my not referring to earlier papers, because that got me into trouble. The decision was made by Minister Baume to grant the land, but he deferred his decision in respect of the mining allotments applied for by Peko-Wallsend. That was a matter which was also before Minister Wilson. The whole issue was before a previous Government from July 1981 to February 1983. When I became Minister on 11 March, the matter was referred to me, and I made a decision on 15 March granting the claim. That was then subject to a court appeal. The issue finished in the High Court of Australia. Relating to the matter raised by the Leader of the National Party, I simply say this: The basis of the High Court decision was to uphold a previous decision that had been made by the Full Federal Court in favour of Peko-Wallsend Ltd on the basis that not all the papers that should have been before me were before me. The papers that were not before me, and which were not placed before me by the Department-I did not seek such papers-related to the files of previous Ministers. I was concerned to honour constitutional convention which covers that, as was the Department. It is, I think, of interest to previous Ministers to note now that the decision of the High Court seems to have overruled that convention and has determined that a Minister must be regarded as possessing the knowledge of officers of his department in respect of matters on the files of previous Ministers. I draw that to the attention of the Leader of the Opposition because I think it may be of some concern to Opposition members. Mr N.A. Brown —We will need to know that in a few months. Mr HOLDING —I would not want to be accountable for whatever knowledge the honourable gentleman might gain in a few months-or for some of the knowledge he had in the past. I leave him to his own practices in respect of where he gains his knowledge. On the basis of that decision, the High Court referred the matter back to me for reconsideration of the Land Commissioner's recommendations. Then I had to look not merely at all the papers; I had to look at the recommendations which were made to previous Ministers. On the basis of that evidence, I decided that detriment would be suffered by the traditional owners if the title were not granted to them. I believe that it is worth bringing to the attention of the House a number of points in respect of some of the arguments that have been presented which suggest that there will be real and significant detriment to Peko-Wallsend Ltd. First of all, in presenting its case to the Land Commissioner-- Mr Cadman —How is the time going? Mr Carlton —Come on. You have been going long enough. Mr HOLDING —I thought honourable members opposite would be interested. Peko-Wall- send chose not to present all the material to the Land Commissioner. One ought to look at the view that was taken on that matter in the High Court and by the Full Federal Court because, given the kind of judicial restraint under which criticism is made, the Full Federal Court said of Peko's presentation of its case before the Land Commissioner, `a director giving evidence on Peko's behalf was, in the opinion of the Court, vague, inaccurate and misleading'. That was a judgment of the Full Federal Court from which no single judge of the High Court was prepared to dissent. On the basis of the decision of the High Court, I wrote to Peko Wallsend Ltd on 19 August asking it to provide me with any additional material. It responded on 9 September. I made a decision to grant the relevant land on 25 September. I have noted the comments in the Press made by the Chief Minister of the Northern Territory saying that this measure is locking up areas that can be or should be developed for mining. I point out that these areas were not excised from stage 2 and therefore were always part of the park. The simple effect of my decision was to vest land which was the subject of report in a traditional Aboriginal community. As a result of amendments passed by the previous Fraser Government, this land is covered in Schedule 4 of the Land Rights Act and therefore would automatically become part of the declared Commonwealth area of the park. So, basically, the kinds of allegations that are being made by the Northern Territory Government are false accusations. I believe that I have made a decision based on all the evidence before me. The fact that that decision happens also to coincide with a very proper decision made by Cabinet that there shall be no mining in Kakadu National Park is a coincidence, but certainly a policy which I fully endorse and support. Mr McGAURAN —My question is directed to the Acting Treasurer. I refer him to the substantiation rules under the fringe benefits tax legislation. If an incorporated company elects to use the statutory formula method when assessing motor vehicle usage, will the implied business usage of the vehicle be around 70 per cent? For a sole trader, however, will the implied business usage be around only 30 per cent if log books are not kept? Why should a small scale business have to keep log books to prove business usage beyond 30 per cent while an incorporated business need not keep log books to prove business usage of around 70 per cent? Mr HURFORD —The answer to the first part of the honourable member's question is no. The amount that can be claimed for business usage under the statutory formula depends on the number of kilometres driven. It is true that up to 70 per cent can be claimed but it depends on the number of kilometres involved. If the total number of kilometres is 15,000 or less, the amount that could be claimed is less. In answer to the second part of the honourable member's question, yes, differing amounts can be claimed under the fringe benefits tax legislation. The honourable member's question points up the extraordinary inability of the Opposition to do anything except to spread a smokescreen about the fringe benefits tax. Opposition members have not understood the substantiation of claims. The fact is that most of the claims made under the statutory formula for the fringe benefits tax would be enormously beneficial to those people using their car in the way referred to in the question from the honourable member. For instance, even if a car had been driven 15,000 kilometres or less over the year, the percentage considered as private usage would be 24 per cent. If the yearly kilometre figure were between 15,000 and 25,000, the percentage considered for private use would be 18 per cent. If the figure were between 25,000 and 40,000-- Mr Tuckey —Of what? Mr HURFORD —Basically, it is the percentage of the purchase price of the car. If the number of kilometres falls within those figures, the benefits under the statutory formula are enormous. Business people do not need any documentation in order to claim those very beneficial and generous amounts. When it comes to a private employee making his claim, it is true that the statutory formula amount is 5,000 business kilometres. The reason is that it has been shown through practice that there is much more avoidance of tax in that private usage area where the owner of the car is an employee than where the car is owned by a company. That is the reason for the difference between the two situations. Mr MAHER —My question is directed to the Minister for Trade. What advantages were gained for Australia from the recent deliberations of the Minister in South America and elsewhere? Mr DAWKINS —I thank the honourable member for Lowe for his question. He has always taken a very acute interest in this matter on behalf of all the farmers within his electorate. I am happy to say that the farmers within his electorate, together with the farmers elsewhere in Australia and indeed those beyond Australia in countries which have not embraced the subsidy practices of some of the largest countries, will benefit in the longer term from the results of the discussions that we had in Uruguay a couple of weeks ago. The important thing is that there have been nine failed attempts to have trade in agriculture brought within the discipline of the General Agreement on Tariffs and Trade. For some time we in Australia have held some very serious reservations about the effectiveness of the GATT in terms of our interests. The GATT has been a very effective organisation for the richest industrialised countries, but a dismal failure for those countries which happen to be the most efficient producers of agricultural commodities. Now as a result of these discussions and the work of the countries of the Cairns group, supported effectively by the United States Administration, we have been able to secure agreement by all the 92 GATT contracting parties to have the questions of agricultural trade dealt with in the upcoming negotiations. Although I have said that this will not lead to improvements overnight, it establishes a new basis of confidence for agricultural exporters, and particularly for Australian farmers, to ensure that there is a future for trade in agricultural commodities. I am sure that as a result of these negotiations we will, into the nineties, see a much more propitious outlook for trade in agriculture, and therefore for Australia's farmers. Mr HODGMAN —I refer to the Prime Minister's much-publicised professed love of sport, and in particular taxation ruling No. MT-2032 issued by the Commissioner of Taxation on 30 September last, relating to the application of the Hawke socialist Government fringe benefits tax to sporting clubs. Mr Simmons —On a point of order, Madam Speaker, I ask the honourable member for Denison to withdraw the phrase he just used. I was asked to withdraw `Howard fascist Opposition' last week. Madam SPEAKER —The honourable member will proceed. Mr HODGMAN —I ask the Prime Minister whether he agrees with the Commissioner's arbitrary determination that players receiving more than a mere $30 per competition match over the season will find that their club will have to pay fringe benefits tax at the rate of 46c in the dollar on all prizes presented to them by their club. Does the Prime Minister agree with the Commissioner's arbitrary distinction drawn between trophies presented to `formally recognised achievements' and trophies having `functional utility'? Lastly, how does the Prime Minister justify a massive 46 per cent increase in all sports club running costs throughout Australia, excluding player payments and administration expenses? Mr HAWKE —I am not aware of all the details in the ruling to which the honourable member refers. I have nothing to add to the fairly comprehensive answers I have given already. Mr SINCLAIR(New England-Leader of the National Party of Australia) —I seek your indulgence, Madam Speaker, to ask whether you will forward to the Chief of the Naval Staff a copy of the resolution passed by the House earlier today with respect to the commemoration of the seventy-fifth naval anniversary. Madam SPEAKER —Certainly, that will be attended to. Mr KERIN(Werriwa-Minister for Primary Industry) —Pursuant to section 9b of the Fisheries Act 1952, I present an agreement between the Commonwealth of Australia and KKFC Pty Ltd dated 28 July 1986. Motion (by Mr Young) proposed: That the House take note of the paper. Debate (on motion by Mr N.A. Brown) adjourned. Mr SCHOLES(Corio-Minister for Territories) —For the information of honourable members, I present the annual report of the Australian Capital Territory Building Review Committee for 1985-86. Mrs SULLIVAN(Moncrieff) —I wish to make a personal explanation. Madam SPEAKER —Does the honourable member claim to have been misrepresented? Mrs SULLIVAN —I do, Madam Speaker. Madam SPEAKER —The honourable member may proceed. Mrs SULLIVAN —In Question Time, I asked the Prime Minister (Mr Hawke) a question about the application of the fringe benefits tax in the case of live-in help for invalid pensioners and disabled people. In his response, the Prime Minister said that Opposition members had been derelict in their duty since it was only now that these particular aspects were being raised by us. More than one month ago, I wrote to the Treasurer (Mr Keating) about the case of an invalid pensioner constituent of mine who was in the position of having to pay fringe benefits tax on the assessed value of accommodation and meals for live-in help. The Treasurer has not yet acknowledged receipt of my letter. For the last period of sitting, on each day I was present, I attempted to ask my question on this application of the fringe benefits tax. The fact that I have not raised it earlier in this place with the Government does not mean that I am derelict in my duty. I had tried to do so, but it was only today that I was able to get the call in Question Time and get any sort of response from the Government. Mr HOLLIS(Throsby) —Madam Speaker, I seek leave to make a personal explanation. Madam SPEAKER —Does the honourable member claim to have been misrepresented? Mr HOLLIS —I do. Madam SPEAKER —Please proceed. Mr HOLLIS —My attention has just been drawn to the 19 September issue of the News Leader of Nowra, in which Senator Michael Baume and Mr Graham Hurst are reported to have strongly criticised me for not attending a meeting called by small business groups to discuss the fringe benefits tax. This meeting was called at Bomaderry. It is claimed in the newspaper that I failed either to attend the meeting or to apologise for non-attendance. The reason why I did not attend or apologise is quite simple: I was not invited to the meeting and I did not even know it was on until I read this article in the paper. 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 assembled: The humble petition of the undersigned citizens of Australia respectfully showeth: That we strenuously object to the proposal that many Post Office Agencies are to be closed. They provide a network of offices with postal and agency services to residential areas and small communities. They serve a community need and we would be seriously inconvenienced if forced to travel further to purchase postal items or collect parcels. It would be an unnecessary expense particularly for pensioners without their own transport. We maintain that the purpose of Post Offices should be to serve the public for the variety of services they offer. They are a community centre particularly in country areas and if necessary they should be subsidised to retain them. Your petitioners therefore humbly pray that The House should take all possible steps to prevent the closure of the Post Office Agencies and that the network should be extended, with the Agency services they offer expanded. And your petitioners as in duty bound will ever pray. by Mr Beale,Mr Braithwaite,Mr Brumby,Mr Cadman,Mr Donald Cameron,Mr Carlton,Mr Cross,Mr Downer,Mr Drummond,Dr Harry Edwards,Mr Hawker,Mr Howard,Mr Howe,Mr Hunt,Mr Jacobi,Mr Kent,Mr Milton,Mr Allan Morris,Mr Ian Robinson,Mr Rocher,Mr Ruddock,Mr Sharp,Mr Tickner,Dr Watson and Mr Webster. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned shows: Graduated family allowances are of important assistance to families with more than one child. All family allowances, whether for one, two, three, or more children, have not kept pace with inflation. There are suggestions that all family allowances should be paid at the one flat rate. This would severely disadvantage families with more than one child. There are also suggestions that the dependent spouse rebate be reduced or removed. This would represent another blow to the family unit. Your petitioners therefore pray that the House of Representatives, in Parliament assembled, should: Ask the Federal Government to increase the value of existing family allowance payments, and Reject any moves to change payments to a flat rate or to tamper with the spouse rebate; And your petitioners as in duty bound will ever pray. by Mr Hawke,Mr Hawker,Mr Hurford,Mr Kent and Mr O'Keefe. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. We, the undersigned plead that the Parliament implement pro-family policies. In particular we appeal for: 1. the retention of the present graduated assessment system for payment of the Family Allowance; 2. indexation of the Family Allowance in order to keep pace with inflation; 3. an increase of 3.7% in the Family Allowance benefit to return it to 11.5% of the Average Award Wage (making it similar in value to the 11.5% of the Basic Wage when Child Endowment was first introduced by the Chifley Government in 1941). 4. retention of the Dependent Spouse Rebate and the amount of the Dependent Spouse Rebate adjusted so that it is equal in value to the tax-free threshold allowed when calculating taxable income. Your petitioners therefore humbly pray that you will give this matter earnest consideration. And your petitioners, as in duty bound, will ever pray. by Mr Drummond and Mr Rocher. 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: 1. That over 67,000 men, women and students enjoy the pursuit of their sport and recreation every year at the Anzac Rifle Range at Malabar and have done so since 1967. 2. The people of Sydney through their membership of 41 clubs headquartered at Anzac Rifle Range together with a number of other community, school and commercial groups, the police and armed forces will lose this community facility if the Federal Government proceeds to sell the Range to private developers. 3. The Australian Bicentenary Fullbore Rifle Championships are to be conducted at the Anzac Rifle Range in April 1988 as part of the celebration of Australia's Bicentenary. Your petitioners therefore urge the House of Representatives and the Government of the Commonwealth to retain the Anzac Rifle Range for the continued use and enjoyment of the people of Australia. And your petitioners as in duty bound will ever pray. by Mr Robert Brown,Mr Hunt and Mr Punch. 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 Labor's capital gains tax, fringe benefits tax, tax on lump sum superannuation and assets test are an unwarranted burden on the people of Australia, have contributed to the national economic crisis and the anomalies in the legislation are causing confusion and anger amongst all sections of the Australian community. Your petitioners therefore humbly pray that the House of Representatives in Parliament assembled should immediately seek the repeal of Labor's Assets Test, Labor's Capital Gains Tax, Labor's Fringe Benefit tax and Labor's tax on lump sum superannuation. And your petitioners as in duty bound will ever pray. by Mr Dobie,Dr Harry Edwards and Dr Watson. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled: This petition of the undersigned citizens of Australia respectfully showeth that- (1) A cessation of the testing of nuclear weapons would break the cycle of research, development and deployment of nuclear weapons and prevent the acquisition of new and ever more lethal weapons of mass destruction. It would thus be a major and significant step towards ending the arms race and beginning the disarmament process; and (2) The Soviet Union has extended its unilateral moratorium on nuclear weapons testing until August 6 this year and has again invited the United States to cease its nuclear testing program. Your petitioners therefore urge the Australian Government to put the strongest pressure on the United States Government to join the Soviet Union's nuclear test ban. And your petitioners as in duty bound will ever pray. by Mr Jenkins,Mr Kent and Mr Milton. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned respectfully showeth. We most strongly oppose the process of Food Irradiation by radioactive Cobalt 60 or any other radioactive substance. We oppose the introduction of regulations that will facilitate the food irradiation process by State Governments. We express our deep concern at this attempt to extend the use of radioactive substances and exposure of workers to radiation. We call on the Government to immediately ban the importation of radioactive Cobalt 60 or other radioactive substances and to immediately disallow the regulations that permit the irradiation of food here in Australia. by Mr Kent,Mr Milton and Mr Scott. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia showeth that whereas: 1. They are completely satisfied with the design of the existing Australian National Flag. 2. They are aware that 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 divisions 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 Dr Harry Edwards and Mr Hawker. To the Honourable the Speaker and the Honourable Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia showeth that whereas: They are completely satisfied with the design of the existing Australian National Flag. Your petitioners therefore pray that your honourable House will: Give a speedy passage to the Flags Acts 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 Brumby. To the Honourable the Speaker and the 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' 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 of the Parliament of Australia assembled. We, the undersigned, plead that Parliament will legislate, or act in accordance with the present legislation to replace the current members of the Film Censorship Board who have admitted to Senator Harradine on 12th December 1984 as reported in the Senate Select Committee on Video Material, (see attached extracts), that they are not applying either the blasphemy or obscenity tests as required under the provision of the Customs (Cinematograph Films) Regulations, and that these persons be replaced by persons who will apply these and the other related test in accordance with the said Regulations. Your petitioners humbly pray that you will give this matter your earnest consideration. And your petitioners, as in duty bound, will ever pray. by Mrs Kelly and Mr Sharp. 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 fee 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. by Mr Kent and Mr Milton. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The Petition of the undersigned citizens of Australia respectfully showeth: (1) that the phasing down and eventual closure of the services of the Commonwealth Rehabilitation Centre at Glen Waverley will be detrimental to the rehabilitation of disabled Australian citizens; (2) that the Glen Waverley Rehabilitation Centre is `purpose' built and its loss would deprive disabled Australian citizens of a unique multi-million dollar facility; (3) that the essential accommodation for disabled Australian citizens will no longer be available. Your Petitioners therefore humbly pray: (1) that the phasing down of the services of the Glen Waverley Rehabilitation Centre be reversed immediately; (2) that the one-hundred-and-four-bed residential facility be fully utilised immediately; (3) that sufficient funding is provided by the Commonwealth Department of Community Services to operate the Centre at full capacity. And we pray you may be conscious of God's sovereign purpose for our Nation and your petitioners in duty bound will ever pray. by Mr Aldred. 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 we the undersigned are totally opposed to the introduction of a $2.00 fee on prescription drugs for pensioners; (2) That the impact of such a fee will be particularly felt by the chronically ill elderly who will be faced with a $2.00 burden with the purchase of each Pharmaceutical Benefit Scheme drug; Your petitioners therefore urge the House of Representatives and the Government of the Commonwealth to ensure that prescription drugs continue to be provided to the pensioner population without the $2.00 fee on each prescription. And your petitioners as in duty bound will ever pray. by Mr N.A. Brown. To the Honourable the Speaker and Members of the House of Representatives. The petition of the undersigned respectfully showeth that the Fringe Benefits Tax is an iniquitous and unjust impost which will further damage the Australian economy and further increase costs to employers. The Tax will: (1) further increase the level of unemployment; (2) increase the administrative costs and overheads for business and Government; (3) particularly disadvantage small businesses and farmers; and (4) act as a disincentive to those who are the most productive and skilled; and we the undersigned call upon the Government to immediately repeal the Fringe Benefits Tax. And your petitioners, as in duty bound, will ever pray. by Mr Cadman. To the Honourable Speaker, and Members of the House of Representatives in Parliament assembled: We, the undersigned, are deeply concerned at the impact of the new Fringe Benefits Tax on the following grounds: 1. its severe and damaging effect on business confidence, investment and incentive, especially in the rural, mining and small business sectors 2. its capacity to seriously worsen unemployment through the additional costs it imposes 3. its extremely negative impact on the competitiveness of export industries at a time when the nation desperately needs to improve its trading performance 4. in that it may compel many honest and decent citizens to defy the Tax in order to preserve their livelihoods, their businesses and the jobs of their employees, thus causing hardship, the breakdown of respect for the law and discord within the community. We therefore most earnestly petition you to repeal the Fringe Benefits Tax Legislation forthwith. Your petitioners, as in duty bound, will ever pray. by Mr Hunt. To the Honourable the Speaker and Members of the House of Representatives in the Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth that: The fringe benefits tax will cause hardship to business throughout Australia, especially in the already severely-depressed rural sector and in the motor vehicle industry. The fringe benefits tax will be a disincentive to employment and worse, will result in additional unemployment. The economy of this country would best be served by policies that lightened the tax burden, not increased it, that encouraged enterprise, not stifled it and stimulated growth, development and jobs, not prevented it. Your petitioners therefore pray that the House will repeal this legislation and your petitioners, as in duty bound, will ever pray. by Mr Rocher. To the Honourable the Speaker and Members of the House of Representatives. The petition of the undersigned respectfully showeth that the Bill of Rights is not supported by the people of Australia, and calls on the Government to: Delay proclamation of the Bill until all matters of contention are settled by national referenda, and that: (1) Matters of States rights, property rights, rights of the newborn, the right not be belong to unions, among other issues, have not been submitted to the people of Australia to decide, and that; (2) No Australian Bill of Rights should depend on any foreign convention for its basis in Australia law. 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 Petition of the undersigned shows: that we the citizens of the Illawarra Region condemn the decision to close the Wollongong office of the Department of Immigration and Ethnic Affairs and that we respectfully request that this decision be reversed immediately. 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. We, the undersigned, plead that Parliament becomes aware that the Public has no legal right to influence the setting of Standards for Television Programming, that we deplore the new Standards which came into force on 1st February, and that we call on Parliament to amend the Broadcasting and Television Act 1942, section 16 (2), so that the Australian Broadcasting Tribunal, when determining Television Standards, and screening hours, shall consult with the Australian people: Because at present the Tribunal is compelled by law to consult only with television stations on these matters, Because the new standards are a result of such consultation, and have already been implemented without public discussion, Because the new Standards are ambiguous, and without definition, Because the new Standards are composed of modifying terms which circumvent the proscriptions, Because the media is only motivated by aspirations of pecuniary superiority, Because, in contrast, the public is only motivated by their wish to exercise pastoral care over the nurturing home environment of their children, Because we believe that the Standards wrongly ascribe extreme importance to ``the storyline'' of a film screened, Because we believe that the Standards wrongly ascribe total unimportance to the effects of viewing, especially violent films, on the young, the impressionable, the immature, the unstable, or the socially disadvantaged, Because we refuse to accept the media-imposed assessment of community standards, And because we wish to impart our demand to be consulted, our demand to have legal status in decision-making, and the right to counsel those whose decisions so deeply affect our homes. Your petitioners, therefore humbly pray that you will give this matter your earnest attention, 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. We the undersigned are deeply concerned that under the guise of ceasefire the Government of Sri Lanka has largely militarised Tamil regions and has now resorted to airship attacks in highly populated areas and indiscriminate killings of civilians which is seen even by the Indian Foreign Minister as having genocidal tendencies. Your petitioners humbly pray that the House of Representatives in Parliament assembled will call upon the government to: 1. Intercede with the government of Sri Lanka to desist from airship attacks and seeking a military solution; 2. To offer refuge under humanitarian and compassionate programmes, to Tamils who are fleeing from the violence; 3. Abandon all direct and indirect forms of repatriation of any Tamil who has sought refuge in Australia and grant them meaningful assistance to resettle; 4. As a member of the Commonwealth, persuade the Government of Sri Lanka to pursue a political solution which will allow the Tamils to live in peace and dignity. Your petitioners, as in duty bound, will ever pray. by Mrs Darling. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned residents of Australia respectfully showeth: That the humble petitioners are gravely concerned about recent changes in the Extradition (Foreign States) Act of 1966 which deny basic rights which have been a cornerstone of the English and Australian law for over seven hundred years. We are speaking of the right to be presumed innocent until proven guilty and the right of an individual to defend himself against his accusers. This concern has come to light during recent extradition proceedings against Messrs Hempel and Etheredge in Western Australia. We are concerned that because judicial protection of these basic rights has been excluded from the Act refugees, migrants, Australian overseas travellers, and visitors are at risk when they have been to (or come from) countries where the norms and practices of human rights and civil liberties are below traditionally accepted Australian standards. We the undersigned petitioners, therefore urge the Government to re-examine the Extradition (Foreign States) Act as amended in 1985, and amend the current Act so that the rights of the accused are once again judicially protected in Australia. In addition, we urge the government to refrain from entering into any further extradition treaties or proceedings under the current Act until the process of re-examination and amendment of the Act has occurred. 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 electors of Australia respectfully showeth: That the Government should cancel the Fringe Benefits Tax they intend to impose on businesses throughout Australia because: 1. The tax discriminates against charitable organisations, sports clubs, private schools and religious organisations; 2. The tax will mean employees around Australia will suffer reductions in their remuneration packages; 3. The Bill places another impossible burden of paperwork on small business; 4. The Bill is absurd in its application to Government employees, who now constitute 32% of the workforce. 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 House. The petition of certain citizens of Australia respectfully showeth: That the Bill of Rights Bill is a dangerous piece of legislation which gives us no new legally enforceable rights; That the Bill of Rights leaves out vital rights such as the right not to belong to a trade union, the right to own private property, the right to a private education; That the Bill of Rights gives dangerous new powers to a Federal Government Commission to investigate in private, without legal representation and with criminal penalties for refusing to co-operate; That the Bill of Rights deals with our rights; therefore we, the people, should say whether we want it by a referendum. Your petitioners humbly pray that you repeal the Bill of Rights legislation and not restrict the individual freedoms of Australians and its present justice system, nor in any underhand way centralise power in our three tier system of Government. And your petitioners as in duty bound will ever pray. by Dr Harry Edwards. To the Honourable the Speaker and Members of the House of Representatives in Parliament House assembled. The petition of certain citizens of Australia respectfully showeth: That the Bill of Rights is a dangerous piece of legislation which gives us no new legally enforceable rights; That the Bill of rights leaves out vital rights such as the right not to belong to a trade union, the right to own private property, the right to a private education; That the Bill of Rights gives dangerous new powers to a Federal Government Commission to investigate in private, without legal representation and with criminal penalties for refusing to co-operate; That the Bill of Rights deals with our rights; therefore we, the people, should say whether we want it by a referendum. Your petitioners therefore pray that you oppose the Bill of Rights, support Liberal amendments to improve it in case it is passed, and pledge to repeal it should it become law. by Mr Hawker. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned shows: That the Hawke Government should; 1. Pass on the full benefit of low international oil prices; 2. Not increase or extend fuel taxes; and 3. Maintain its tax cut commitments. Your petitioners humbly pray that the Hawke Government honour its commitment to the Import Parity Pricing policy. And your petitioners, as in duty bound, will ever pray. by Mr Hawker. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of 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 iniquitous and unfair Assets Test. And your petitioners, as in duty bound, will ever pray. by Mr Hawker. To the Honourable the Speaker and members of the House of Representatives in Parliament assembled. This petition of concerned Australian citizens respectfully points out: That deterioration of the total global environment is continuing at an increasing rate; that important environmental resources vital to human livelihood such as trees, soil and water are decreasing at an alarming rate; that there is a need for educating all people to assume a greater responsibility for the conservation, sustainable use and maintenance of vital resources; that dynamic and active initiatives are needed to conserve and renew the total environment; and that protecting, conserving and repairing the Earth can unite all people and nations in co-operative action for survival; Your petitioners therefore humbly pray that the Australian Government will: propose to the United Nations General Assembly at its 41st Session in September 1986 that 1988 be proclaimed the `First International Earth Repair Year'. And your petitioners as in duty bound will ever pray. by Mrs Kelly. To the Honourable the Speaker and the Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens respectfully showeth that your petitioners wish that all medicines prescribed by a registered Medical Practitioner be made available free of charge by the Government to all pensioners for the following reasons: 1. The enormous cost of some drugs, including pain relieving ones, not at present on the ``free list''. 2. That certain drugs essential for permanently disabled, such as epileptics are at present being charged for and therefore present a great financial burden to the pensioner. Your petitioners therefore pray that your honourable House will consider our wishes. 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 citizens of Australia of Albanian back-ground respectfully showeth: We most strongly oppose the use of the ``special broadcasting service'' and the taxpayers funds for nationalist political purposes. We are deeply concerned that the existing Albanian program on Radio 3EA Melbourne is not meeting the needs of the community. It is being used against its interests, as well as the interests of the broader Australian society. We respectfully believe that such use of public facilities undermines Australian principles of multi-culturalism and has a damaging effect on community relations. Your petitioners therefore, strongly urge the Government to take immediate action to ensure that the present announcers of the Albanian program are removed and replaced with community representatives. by Mr Kent. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned citizens respectfully showeth that your petitioners are gravely concerned at proposed cuts to the functions of the Human Rights Commission. In particular the undersigned believe that the Human Rights Commission or any body that may replace it in December must be allocated adequate resources for complaint handling and community education in the areas of human rights and equal opportunity. The functions at present carried by the Human Rights Commission and the additional responsibilities relating to ILO Conventions III require increased resources if the rights of Australian citizens are to be safeguarded effectively, particularly in States and Territories which at present lack anti-discrimination legislation. And your petitioners, as in duty bound, will ever pray. by Mr Langmore. To the Honourable the Speaker and Members of the House of Representatives assembled in Parliament. The Petition of the undersigned citizens of Australia showeth: That many Australian wage and salary earners and self-employed persons do not enjoy secure retirement incomes provided by superannuation; and That the Government issued in December 1985 Guidelines for the implementation of the proposed productivity decision by the Conciliation and Arbitration Commission and draft Operational Standards for Superannuation schemes. Your petitioners therefore humbly pray that the Government: 1. Guarantees to every employee the right and freedom to select the Superannuation scheme of his/her choice. 2. Protects the individual exercising that freedom of choice from any coercion, influence or other pressure which may be applied by any employer, association or trade union. 3. Will recognise only those schemes which provide genuine superannuation and reject those schemes which do not provide for- preservation of benefits to retirement vesting of employer contributions equal employer and employee Trusteeship control to ensure security of investments. And your petitioners as in duty bound will ever pray. by Mr MacKellar. To the Speaker and Honourable Members of the House of Representatives of the Australian Parliament assembled. The petition of the undersigned residents of Australia respectfully showeth: We the undersigned residents of Australia totally reject any move to cut funding to Australia-wide English as a Second Language programs in schools. We request that the Australian Government restore funding to the 1985 level in the 1986-87 Budget. by Mr Ruddock. 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 Bill of Rights and the Human Rights and Equal Opportunity Bill: 1. Offer nothing more than is already available under law, 2. deny some Human Rights and do not include others, 3. give dangerously wide powers to an unelected body, and 4. could cause far more damage than they could possibly cure. Your petitioners therefore humbly pray: That the House should completely reject the Bill of Rights and the Human Rights and Equal Opportunity Bills And your petitioners as in duty bound will ever pray. by Mr Snow. To the Speaker and Honourable Members of the House of Representatives of the Australian Parliament assembled. The petition of the undersigned residents of Australia respectfully showeth: We the undersigned residents of Australia deplore the decision by the Federal government to amalgamate the SBS with the ABC. At present there is no guarantee that the principles of multicultural broadcasting will be maintained at any level of the ABC administration. An independent and strong SBS should be retained. We pray that the Parliament opposes an amalgamation of the ABC and the SBS. by Dr Theophanous. To the Honourable the 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: Take the action necessary to create an Australian Republic on or before 1st January 1988. And your petitioners, as in duty bound, will ever pray. by Mr Tickner. To the Honourable the Speaker and the Members of the House of Representatives of the Commonwealth in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth: That in the wake of the Chernobyl Reactor disaster, no nuclear reactor can be considered entirely safe. Your petitioners therefore pray that the Government close down the Lucas Heights reactors immediately and permanently, and that no new nuclear reactors be built within Australia. And your petitioners, as in duty bound, will ever pray. by Mr Tickner. To the Honourable the Speaker and the Members of the House of Representatives of the Commonwealth in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth: That they oppose the construction of any additional nuclear reactor at the Australian Atomic Energy establishment at Lucas Heights in N.S.W., or any site within Australia. Your petitioners therefore pray that the Government of Australia will not construct an additional nuclear reactor at Lucas Heights or within Australia. And your petitioners, as in duty bound, will ever pray. by Mr Tickner. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled, Parliament House, Canberra, A.C.T. 2600. We your petitioners, humbly showeth: That the wildlife species, in this case the kangaroo, have a right to exist and flourish independently of human needs. For this reason alone we should not regard the kangaroo as a human resource nor contemplate commercial exploitation simply because more offspring are born each generation than can hope to survive. Permissible cropping rates are unknown and the means of enforcing controls or protective legislation is completely ineffective and inadequate due to the widespread nature of the industry. All Australians have a responsibility to our already declining wildlife. We your petitioners therefore humbly pray that you will: (1) Ban the export of products made from kangaroos. (2) Take action to see that State governments prohibit the commercial killing of kangaroos. by Mr Tickner. To the Right Honourable the Speaker and Members of the House of Representatives of the Commonwealth in Parliament assembled. The humble petition of the undersigned citizens of New South Wales respectfully showeth: That they strongly support the establishment of the Western Sydney State University as recommended in the Parry Report and call upon the House to establish the Western Sydney State University in conjunction with the New South Wales Government. And your petitioners, as in duty bound, will ever pray. by Mr Cadman and Mr Gorman. To the Honourable Speaker and the Members of the House of Representatives of the Australian Parliament. We, the undersigned citizens and electors of Queensland do humbly pray that the Queensland members of the House of Representatives will: (i) Oppose the introduction of the $250 Tertiary Administration Fees that were announced in the Federal Budget on Tuesday, 19 August 1986. (ii) Vote against any legislation that would attempt to establish this fee, given that it is setting a precedent for further increases in fees. Your petitioners, as in duty bound, will ever pray. by Mrs Darling. To the Honourable the Speaker and Members of the House of Representatives assembled in Parliament. The petition of certain residents of the State of Western Australia draws to the attention of the House that the Government has increased wholesale sales tax another 10 per cent under the 1986-87 Budget, resulting in a 20 per cent sales tax on wine. This tax was introduced at a time of a record trade imbalance between our wine imports and exports and will further exacerbate that problem. Your petitioners therefore ask that the Government cancels the 20 per cent sales tax before it causes a further contraction in our wine industry, with consequential loss of exports, and employment in the wine and tourism and retailing industries which are currently operating in Western Australia. by Mr Drummond. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of certain citizens of Victoria respectfully showeth: That all legitimate business expenses incurred in earning or producing assessable income should be allowable deductions. That the proposed Capital Gains Tax is an unwarranted burden on the rural sector, which will severely affect its long-term viability. That the delay by the Government in introducing the legislation into Parliament is causing confusion and hindering farmers in the organisation of their affairs. Your petitioners humbly pray that the Government introduces the Capital Gains Tax legislation without delay and that the Australian Democrats join with the Opposition to defeat the proposed legislation. by Mr Hawker. To the Honourable the Speaker of the House of Representatives in Parliament assembled. The petition of the undersigned, respectfully showeth that we, the people of Victoria would like to remind you of your moral duty in regard to your decision to sell Uranium to France, against ALP policy. The French are still nuclear testing in the South Pacific, despite world wide protests. We therefore call on you to reverse the decision to sell Uranium to France. by Mr Milton. To the Right Honourable the Speaker and Members of the House of Representatives of the Commonwealth in Parliament assembled. The humble petition of the undersigned citizens of the Sutherland Shire respectfully showeth: That they oppose the construction of any additional nuclear reactor at the Australian Atomic Energy establishment at Lucas Heights in N.S.W. Your petitioners therefore pray that the Government of Australia will not construct an additional Nuclear Reactor at Lucas Heights. And your petitioners, as in duty bound, will ever pray. by Mr Tickner. 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 as 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. Bill returned from the Senate without amendment. Assent reported. Mr DEPUTY SPEAKER(Mr Leo McLeay) — Madam Speaker has received a letter from the Leader of the Opposition (Mr Howard) proposing that a definite matter of public importance be submitted to the House for discussion, namely: The damage to business, farmers and individuals caused by the Fringe Benefits Tax. 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 HOWARD(Bennelong-Leader of the Opposition)(3.18) —What a remarkable Question Time it was today. The Prime Minister (Mr Hawke) may well have signalled today the beginning of the great Hawke retreat on the fringe benefits tax. At long last the Prime Minister has discovered that there are unintended consequences of the fringe benefits tax. I put it to the House that the only things the Prime Minister has discovered about the fringe benefits tax are the unexpected buckets and the unwanted criticisms that he has received. No amount of prime ministerial tinkering at the edges and no collection of attempts by the Prime Minister to tune up the fringe benefits tax and respond to this or that complaint will in any way alter the fundamental thrust of what the Opposition is saying; that is, that this tax should go, lock, stock and barrel. As far as the Opposition is concerned, not only is this tax wrong administratively but also-the Prime Minister got it right today for once when he quoted what I said on the steps of Parliament House-it is wrong in principle. I will tell honourable members later in my remarks why I regard it as being wrong in principle. Before I do that, let us spare a moment for what the Treasurer (Mr Keating) must be thinking over in Chicago, where he is continuing to mislead the American public about the true state of the Australian economy. I make no apology whatsoever for saying that. The poor old Treasurer must be wondering what Old Silver is up to while he has gone away on his mission to the United States of America, because a few weeks ago-in fact, a few days ago-he would have been thinking: `You go out of the country and Old Silver goes berserk; he gets a rush of blood to the head. He starts answering questions at Question Time and starts looking at unintended consequences'. Before the Treasurer went overseas, he said at a Press conference on 8 August: It's a total furphy, a total furphy. The government is not going to change this tax. It got better later on in that Press conference. Listen to this one; he really gets Old Silver right square in his gunsights- Mr DEPUTY SPEAKER(Mr Leo McLeay) —Order! If the honourable member is referring to another member, he should do so by his title. Mr HOWARD —It is a matter of notoriety. Mr DEPUTY SPEAKER —If the honourable member is referring to a member, he should do so by his title. Mr HOWARD —The Treasurer got him right square in his gunsights with this one. This is an absolute ripper. This is what he said: We didn't fight for this thing to see it squandered by, you know, some pressure group getting in touch with a Labor leader's office. I mean we are not going to change this thing. He went on to say: We're not changing the fringe benefits tax, it's here to stay. Four days later, on 12 August, the Treasurer, when talking to the Melbourne Sun, said: There's not going to be any administrative changes-that's it. On 24 September, he said: Let me make it clear about fringe benefits taxation, the government is not going to alter the fringe benefits tax. The reality is that the Treasurer has gone out of the country and the Prime Minister is about to do another tax summit deal on the Treasurer. The Treasurer did not know about the discussion the Prime Minister had at the International Motor Inn with the leaders of the Australian Council of Trade Unions during the National Taxation Summit. The Treasurer arrived on the steps of Parliament House and said that his beloved option C was still up and running; meanwhile the Prime Minister had done a deal to do something about it. Very interesting indeed. Fine tuning the fringe benefits tax and fiddling around at the edges will not get the Government out of the enormous economic and political hole into which it has fallen on this tax. Let me deal briefly with this absurd canard that has been put around by the Government about the alleged obligation on the Opposition to state every detail of its alternative taxation policy 15 months before the date stated by the Prime Minister as being the date of the next election. Be it remembered that this Government went to the last election with a tax policy which consisted of nothing more than a promise to have a meeting. That is all it did. That was the entirety of the tax policy of the Government and that was dreamt up halfway through the campaign, not even when it started the campaign. Yet the Prime Minister has the unbelievable gall to say: `I want all the details of your policy' 18 months before the next election. This is the man who did not utter a word about a fringe benefits tax before the last election. If we go through every item of what the Treasurer and the Prime Minister have said about tax, do we find a word about a fringe benefits tax? No. Mrs Sullivan —`There will be no capital gains tax'. Mr HOWARD —Of course we all remember, as the honourable member for Moncrieff reminds me, those immortal, never to be forgotten words: `There will be no capital gains tax'. Yet this is the man who has the gall to come into this Parliament and say: `I want every detail of your taxation policy', 18 months before the next election. On behalf of the Opposition, I say to the Prime Minister and to the Australian public that our position on the fringe benefits tax is crystal clear. That fringe benefits tax will be totally and completely repealed. We have never disguised the fact that, if there are any arrangements or practices that involve tax avoidance in this area, they will be dealt with by another method. That method will be detailed when our taxation policy is announced, and that has been made perfectly clear from the word go. Let me say to the Acting Treasurer (Mr Hurford) that if he imagines that I shall respond to his absurd proposition that the Opposition must table all the details of its alternative taxation policy well before the next election, he has another think coming. This fringe benefits tax is wrong in principle. Mr Cunningham —Why? Mr HOWARD —I shall give five reasons why it is wrong in principle. First, it is of unbeliev- able complexity. As I reminded the Prime Minister at Question Time, there are 139 pages of legislation, 176 pages of explanatory memorandum, two booklets of 69 pages, 14 rulings of 115 pages, a pamphlet and a video. The only thing that we have not had is a guest appearance from the Prime Minister, but no doubt that will be coming. Shall we have some sort of television mini-series as the next exercise in trying to explain the tax? The second feature that is wrong with the tax is that it involves the principle of obliging people to bear the tax obligations of others. It is insensitive and indifferent to those who live in the remote areas. I look forward greatly to the contribution of the honourable member for McMillan (Mr Cunningham). I want him to tell country people why it is a rort for a farmer to provide someone living in a remote area with some accommodation. I want him to go to Gunnedah to meet some of the farmers whom I met when I was with my colleague, the Deputy Leader of the National Party. These farmers told me that they were not earning enough money to go above the tax-free threshold, but because their sons were employed in their farming businesses and occupied a cottage on the farm they had to borrow money from the bank to pay fringe benefits tax. I suppose that that is one of the honourable gentleman's rorts. It is simply not good enough for the Prime Minister to come into the chamber as some latter-day apostle of concern for those who have been gathered up within the reaches of the fringe benefits tax and to say: `I did not want to hurt people. I did not want to affect people who should not have been affected.' I say to the Prime Minister: If there are rorts in the area of the fringe benefits tax, the Government has an obligation to identify the rorts, to name them and to do something quite specific and selective about them. It is not good enough to hide behind a shield or to take a blunderbus approach, which is the doctrine that provides that if one person in a group or category is doing something wrong everyone should be exterminated-in other words, slap the tax on everyone. That is the third reason why I regard the tax as being completely wrong in principle. The fourth reason is that the tax hits at the productive sector of the economy. It is based upon a great principle that has always been revered by the Labor Party when it comes to taxation, and that is spite and envy. That is a principle that has always dominated Labor Party thinking. Mr Griffiths —It is called equity. Mr HOWARD —The good old member for Maribyrnong talks about equity. I would like him to justify the equity of imposing a 49 per cent tax liability on a charity that has to raise all of its sustenance from public donations. The honourable gentleman has the gall-- Mr Griffiths —Did you stop the rorts? Mr HOWARD —I would like the honourable gentleman to explain to me-- Mr Griffiths —You have not got the guts. Mr DEPUTY SPEAKER(Mr Leo McLeay) -Order! Mr HOWARD —Do not stop the honourable gentleman, Mr Deputy Speaker; he is terrific. Give the honourable gentleman another go, Mr Deputy Speaker; give him an extension. He has the gall to lecture me about equity and rorts. I did more, my friend, than any Treasurer since Federation to stamp out tax avoidance. Do not give me any lectures on that score. It ill becomes the Prime Minister to give me lectures about what I said in 1980. He had better be careful. I might remind him of what he said in 1980 when he, the then Leader of the Opposition, the present Minister for Foreign Affairs (Mr Hayden), and the then shadow Treasurer, who is now the Minister for Employment and Industrial Relations, ran around the country and criticised everything that I was trying to do in 1980. So much for the great double standards. Let me return to the real reason that the Government is getting cold feet over the fringe benefits tax. It has nothing to do with equity or with unintended consequences and it has nothing to do with its concern not to hurt the disadvantaged. It has everything to do with the fact that the Prime Minister and the Treasurer have been warned out of Queensland until after 1 November. If the Prime Minister really thinks he can beat me on the subject of equity in taxation, let us have a public debate between the Prime Minister and me, and let us have it in Brisbane before 1 November. If he really believes that on grounds of equity, fairness, justice, stamping out tax avoidance, providing incentive and providing an overall balance to the Australian taxation system his credentials are better than mine, let him come out from behind the skirts of his parliamentary numbers, let him get away from the protective cloak and reach of the Special Minister of State (Mr Young) and the Treasurer, and let us see how good he is when facing me on a public platform to debate the fringe benefits tax. I cannot think of a better city in Australia in which to hold that debate within the next month than the beautiful city of Brisbane. It has always been one of my favourite cities, and I reckon that we would get a good turn-up. There is no doubt in the world about that. The reality is that the Prime Minister does not have the guts-that is his word; he used it at Question Time-to face me on this issue on any public platform anywhere in Australia, let alone in Queensland before 1 November. The reason he does not have the courage is simple. He knows that he is beaten on this tax. He knows it is wrong. His back benchers are running scared. We saw their long faces during Question Time. I again go through the list of quotations to which I referred earlier. Tom Burns said it is sheer stupidity, and he said a few other things that I will not repeat. John Button said it is horrendous, and Bob McMullan, in a typical understatement, said it is a bit of a problem. The list goes on. No amount of fiddling at the edges, no amount of cosmetic retreats and no amount of prevarication can hide the simple fact that this fringe benefits tax is fundamentally flawed. Not only is it flawed in principle; it is also flawed administratively. Only one thing should happen to it, and it is the Opposition's policy: It should be thrown out lock, stock and barrel. Mr HURFORD(Adelaide-Minister for Immigration and Ethnic Affairs and Acting Treasurer)(3.33) —Only one term sums up the position of the Opposition on this issue-rank hypocrisy. Members of the Opposition talk about principle and about scuttling principle. They are scuttling equity and fairness, according to the attitude articulated by the Leader of the Opposition (Mr Howard) today. I remind the House of what was his view before he was caught on the front steps of Parliament House today. It is worth repeating: Fairness demands that employees who are paid solely in cash-and most Australians are-should not be asked to pay more tax and thus effectively subsidise those whose income is obtained partly in cash and partly in the form of valuable benefits of other kinds. What is the result of the sort of proposition being put to us by the Leader of the Opposition? He is getting away from fairness and suggesting that there should be discrimination. He has gone through what he alleges is wrong in principle. What is the problem in relation to complexity, which was the first of the five problems with the fringe benefits tax he raised? The mere fact that it is complex does not mean that it is wrong in principle. We have said in the House today that of course it is complex and of course it will take time to settle down, just as the prescribed payments tax legislation was complex and difficult for a reforming party to bring in. But we do not resile from something because it is difficult. We are proud to stand squarely behind equity and fairness in the taxation system. It would seem from what the Leader of the Opposition had to say today that if ever he got back into power we would have further discrimination in the Income Tax Assessment Act: Just because someone lives in a different geographic location, he should not have a tax applied to him that someone in another location has applied to him. But, of course, the Leader of the Opposition gives his position away. He says that the Liberals would try to have some sort of tax but it would be applied by some other method. We are entitled, as the country is entitled, to ask by what other method they would apply the principles of equity and fairness to the taxation system. The Opposition must be called from now on the `gonna' party. It is gonna tell us some time what its policy is. It is gonna tell us how many more millions can be cut from public expenditure, it is gonna tell us some time in the future where those cuts would be made and it is gonna tell us how it would bring equity and fairness to the taxation system. The gonna party will be the goner party, because there is no way that the Australian people will be taken for the mugs that the Opposition seeks to take them for. The Opposition is seeking to tell the Australian people that they can be hoodwinked, but they will not be hoodwinked because we will make sure that members of the Opposition are shown to be what they are-hypocrites, because they will not face up to getting equity and fairness into the taxation system. The Government has the conviction and the courage to bring equity and fairness into our system. Some members of the Opposition front bench have similar principles, and that is why they have been getting caught out. The Leader of the National Party of Australia (Mr Sinclair) is one of them. He has gone on record as saying that they would go back to section 26 (e). The Deputy Leader of the National Party of Australia (Mr Hunt) has been caught out. Even the honourable member for O'Connor (Mr Tuckey) found himself with some principle for a while. I could go through the list, which also includes the shadow Treasurer. I may come back to quote them shortly. Some Opposition front benchers recognise that they cannot get away with the hypocritical attitude to this issue that they are displaying. It begs the question: Why did members of the Opposition not do something to bring about equity and fairness when they were in government? The answer is that they found it difficult. Now, in the expedient and populist way that is so much their wont, they have said, `To hell with principle; we will just attack those who are seeking to bring a bit of equity and fairness into the system'. We should remind ourselves, of course, that there were difficulties in the 26 (e) route advocated by the front benchers to whom I have referred. That would require each employer to calculate the value of non-cash payments to each employee for each pay period. That is the way the Opposition would attack this problem. The Leader of the Opposition has said that it is wrong in principle to tax the employer and not the employee. We can deduce from that that the Opposition would go back to 26 (e) and tax the employee. I ask all the employees of this nation to realise that they will be hit in the pocket if the Liberal and National parties ever regain the government benches of this country. That will mean not only that employees will have to pay so much more out of their own pockets but also that employers will have to put in a hell of a lot more time and effort when valuing the benefits in kind that go to each of the employees. They will have to value these benefits and put them on group certificates and tax stamp sheets every pay period. That will mean much more work for the employers than they will suffer under the fringe benefits tax. I use the word `suffer' quite advisedly. We recognise that there is an imposition on a number of people administratively under our fringe benefits legislation. As I said in Question Time today, we are looking closely at the imposition, monitoring it, and we will be doing what we can, as we did with the prescribed payments tax, to reduce that imposition on those who are suffering it now. I believe that most employers will recognise very readily that having to fill out the necessary forms and collect the information to fill out those forms quarterly under our fringe benefits tax legislation is a heck of a lot less imposition on them administratively than would be the application of section 26 (e). We gather from the Leader of the Opposition that this is the way that he would go. No wonder the Leader of the Opposition is shy in coming out with the details of what he would do instead. He will not be put on the spot right now. Shortly, if he does not spell out in detail exactly what the Opposition proposes as an alternative, we will tell the Australian people in clear terms all the implications. The Opposition and many others who have vested interests are deliberately confusing the Australian taxpayers on this issue. We will not be making any changes which will remove the eminent fairness of the fringe benefits tax, but I repeat that we will be continuing to monitor its administration. Let me address the record keeping problem, which is the main concern. The main burden has related to log books and journey record keeping. I remind the Australian people that there are two ways for log books to be thrown away under the fringe benefits tax. One is to cash out the benefit and get rid of any obligation to the fringe benefits tax. There is nothing to stop the cashing out of the fringe benefits. Pay the remuneration in cash instead of in kind and let the tax fall where it may. Another method was mentioned in Question Time today; that is the statutory formula. Under the fringe benefits tax legislation there is no reason why the statutory formula route should not be taken as an option. It is a very generous route that many people can take. It is not essential for log keeping under the fringe benefits tax legislation. Let us look at that formula. A person driving a company car less than 15,000 kilometres has 24 per cent applied to the taxable value of the car, which is the purchase price of the car, in order to ascertain the private use of the car. Between 15,000 kilometres and 25,000 kilometres, 18 per cent of the taxable value is applied to the base value for the private use of the car, and between 25,000 kilometres and 40,000 kilometres, 10 per cent of the taxable value is applied. If the car does more than 40,000 kilometres as little as 6 per cent of the taxable value is applied to the base value. A very generous amount of private benefit is being included in the taxation return. Let us look at the effect this will have. At 5,000 kilometres the implied business use is only 30.7 per cent; at 45,000 kilometres it is as much as 88.8 per cent. A lot of the smokescreen that is being put up by the Opposition in relation to the administrative burdens of this tax is just that-a smokescreen. It does not apply in fact because alternative routes can be taken through the statutory formula or through cashing out. Let us turn to the use of a car owned by an employee for business purposes or the use of a car by a self-employed person. We find that there are options that can be chosen which allow the throwing away of the log book. I remind the House that it is possible to prove claims for working expenses where the distance travelled for business purposes is less than 5,000 kilometres by multiplying the rate per kilometre by the number of the kilometres travelled for business. That is a much simpler way of arriving at the deduction which can be claimed as a business expense. If the distance is greater than 5,000 kilometres, the statutory formula allows for a claim of 12 per cent of the car's purchase price or one-third of the total car expenses. At present the public has too little knowledge about the options. This is causing a lot of concern. It is incumbent on many of these people who feel they are going to be burdened by log books to keep in touch with the Australian Taxation Office or with their tax consultants in order to ascertain their position in these particular matters. In conclusion, I remind the House that the reason we find it necessary to apply a fringe benefits tax for equity and fairness in our tax- ation system is that some people on very high incomes have been getting away with enormous expense deductions which have not been justified. An example was given by the Treasurer (Mr Keating) in the House the week before last of a person whose salary was only $45,000. This is a real case. This person received a representative allowance of $3,000; superannuation, $6,000; motor vehicle lease, of a Toyota Cressida, $5,800; motor vehicle maintenance, running costs, registration and insurance, $1,900; hostess allowance, $4,000; home telephone, $300; low interest loan, $8,850; school fees, $3,000; and holiday travel, $3,000. Only $45,000 of this package was paid in the form of salary. An employee receiving only a salary would have to be paid $115,125 in order to receive the same after tax benefits. That is why equity is required; that is why we have a fringe benefits tax. Mr DEPUTY SPEAKER(Mr Leo McLeay) —Order! The Minister's time has expired. Mr SINCLAIR(New England-Leader of the National Party of Australia)(3.45) —The fringe benefits tax was conceived through ignorance, sired by stupidity and delivered by incompetence. Nobody could be more uncertain of where we are going after hearing the Acting Treasurer (Mr Hurford) give of his best. No wonder the country is in trouble. A little while ago we had the Prime Minister (Mr Hawke) ringing the Treasurer (Mr Keating) from Beijing. I am quite sure that tomorrow morning there will be a similar call. This time it will be in reverse. It will be a call from Chicago to Canberra, to try to see just where they are going. The reality is that the Government is in an impossible quandary. We know that the tax does not work. I want to go through in a little more detail a number of illustrations of ordinary Australians being in a mess. If the Government thinks it is only people on this side of the House who see the tax and its inequities as being absolutely impossible, all it has to do is look at the record of those who have said things about it. We have the honourable member for Cunningham in the House. He is the chairman of a country task force. He said that the Government needed to do a great deal more to explain the tax. He said confusion was widespread among many self- employed-- Mr Cunningham —I raise a point of order. The right honourable gentleman referred to me as the honourable member for Cunningham. I would expect that he could at least get it right. I am the member for McMillan. Mr DEPUTY SPEAKER(Mr Leo McLeay) —Order! There is no point of order. Mr SINCLAIR —I can well understand the honourable gentleman being embarrassed at the sound of his own name. The honourable member said that the confusion was widespread among many self-employed and small business people who are confusing income tax requirements with fringe benefits tax paperwork. John Bannon said: The administrative requirements of application- that is, of the fringe benefit tax- and some of these things it's picking up I think have probably gone a bit further than the legislation or the intention . . . It's just another annoyance or another uncertainty. John Cain, the Victorian Premier, said that some people would say that the implementation of the fringe benefits tax has `been handled in cumbersome and heavy handed ways'. Barrie Unsworth said: Quite clearly what's come out of the fringe benefits proposal is an administrative nightmare. Of course, there was also that delightful statement of the Leader of the Government in the Senate (Senator Button), who said: I don't want to debate the technicalities of the fringe benefits tax, but I've seen my own form from the Department of the Senate that I have to fill in, and I think it's horrifying. It's too difficult for me, and I appreciate, for that reason, why it's difficult for others. The Deputy Leader of the Queensland Opposition, Mr Burns, described the fringe benefits tax as `sheer stupidity' and `bureaucratic' something that came from the cowyard. He said: When you've got things like people having to fill out dockets every day and logbooks for their vehicles every day, then obviously you need changes. The reality is that this tax is showing that the Government is living in fantasy land. It is making Scrooge McDuck decisions and carrying them out with Mickey Mouse precision. Frankly, the whole position is worse because the application of the tax is in three weeks time. In case anybody in this place or anybody listening to the broadcast is confused, let me explain that so is the Prime Minister, so is the Treasurer, so is the Acting Treasurer and so is the Commissioner of Taxation. We were told when the tax was introduced that what we should be doing was ringing or writing to the Tax Commissioner. The National Farmers Federation sent in about 155 requests for explanations of the terms of the fringe benefits tax in its application. To date it has received responses to only a percentage of them. We are told by the Prime Minister today that he will reconsider the whole of the course of the inequities. He has suddenly realised that there are unintended consequences of the tax. We should know that its course was the product of the tax statement by the Treasurer on 19 September last year. The tax itself took from then until 2 May to be conceived. Yet those who are affected by the tax are in the totally inequitable situation which the honourable member for Moncreiff (Mrs Sullivan) mentioned this afternoon. She has written to the Treasurer and does not even get a response. She cannot get a question in the House and yet the Prime Minister says that, for some reason, she is neglectful in not bringing up the circumstances of these anomalies. Let me run through those circumstances because I think it is important that we put them on the record. We know that concessional loans and bankcard interest rates to bank employees will be subject to fringe benefits tax. We know that the Federal Secretary of the Commonwealth Bank Officers Association said: The FBT was imposed by the Government to catch tax evaders and avoiders, not to attack the working conditions of wage and salary earners. The reason we are going to throw it out, lock, stock and barrel is that it does just that-it attacks the working conditions of wage and salary earners and reduces their standard of living. Let us consider home rental subsidies. State governments are liable to pay fringe benefits tax on home rental subsidies they provide to remote area or other employees. We all know that, if one is posted to Lockhart River, or way out to Tibooburra, one is not going there necessarily because one wants to; one gets there because one is called on to go there, that is, one is required to go there for the conduct of one's job. The State governments are called on to appoint school teachers, police officers-- Mr Hunt —Park rangers. Mr Sinclair —They are called on to appoint park rangers, to live in these remote and harsh conditions. Either the State governments have an unnecessarily harsh increase in their liability or the employee himself is called on to pay because of the increase in the rental charged to him. What about, milk, meat and eggs consumed by employees? These are part of the Federal pastoral industry award applicable to every pastoral employee under that award. The Minister for Finance (Senator Walsh) said in the other House that farmers could be liable for fringe benefits tax, assessed by the Taxation Office, if the Tax Commissioner did not accept the farmer's own estimates of the value of such goods. I refer also to power for workers' cottages. Where one has a generating plant, operating costs could lead to FBT liability of as much as $900 a year. We also have consultations for doctors' employees. Doctors will be liable for fringe benefits tax on free consultations for a receptionist or a nurse. There is also the matter of car parking. Employers are liable to fringe benefits tax on car parking they provide for employees. Yet if one builds a building in the city or nearly anywhere today one is required to provide car parking. There are prizes for sportsmen and sportswomen. We heard a question from the honourable member for Denison (Mr Hodgman) today which referred to the total inequity and confusion on the nature of benefits passed to those who are participating in sporting clubs, sportsmen and sportswomen, in the form of non-cash prizes. Some are taxable, some are not. How do we know? There are three weeks to go. Then there are cripples and invalids. I refer again to the question of the honourable member for Moncrieff. If they employ live-in housekeepers or nurses, they are liable to FBT on the board and accommodation. I refer also to Aboriginal stockmen. Where is the Minister for Aboriginal Affairs (Mr Holding)? Remote area farmers supplying rations to relatives of Aboriginal stockmen will be liable to FBT on the value of the rations. There are 80,000 members of the National Trust and they are liable to pay FBT on the value of accommodation provided to caretakers of properties which are part of the national heritage. The cost to them is about $200,000 a year. In schools, there will be liability for FBT on accommodation and board provided to teachers. We know that where doctors engage locums, if they live in their homes, again an FBT liability is incurred. The Royal Society for the Prevention of Cruelty to Animals, as we found today, will be liable for FBT for accommodation to caretakers at its animal welfare centres. Then there is the matter of taxi fares. Employers who pay cab fares home for employees working late will be liable for FBT. In respect of defence benefits, we have the air conditioning allowance, the education allowance, the furniture and effects allowance, the home loans, the housing, the living out allowance, the removal expenses and the extra risks life insurance. These are men who offer their lives in performing their duties. They will have to pay fringe benefits tax because of insurance taken out to enable them to do so. Medical and dental services provided free to Service personnel will attract fringe benefits tax. Then we have the chaos over company cars. There is major confusion on the application of this tax-to which cars, when and payable by whom. We finally established today the details that are required in the log book, which the Minister says are not necessary. One has to enter the date of the journey, the odometer reading at the start and the end of the journey, the distance travelled, the purpose of the journey, the driver's name, the date of entry, the name of the person making the entry and the signature. The whole concept is anti-business, anti- productivity, anti-farmer and anti-competitiveness. To have the Treasurer of this country over in the United States of America at the moment alleging that in some way we are in a better position than the Americans is absolute rubbish. Labor's blind hatred of the rich and the successful sent it on the FBT course of destruction. No government in Australia's history has been so successful in welding the nation 100 per cent against it and, from the point of view of the Liberal and National parties, this tax has to go and will go, on our election, lock, stock and barrel. Mr CUNNINGHAM(McMillan)(3.58) —Mr Deputy Speaker, I quote: Fairness demands that employees who are paid solely in cash-and most Australians are-should not be asked to pay more tax and thus effectively subsidise those whose income is obtained partly in cash and partly in the form of valuable benefits of other kinds. These words will be repeated ad nauseam because they embody the whole context of what this taxation debate is about. Fairness demands that something be done about the system that had developed under the previous Treasurer. In this debate today we have seen the usual effort by the right honourable member for New England (Mr Sinclair) in muddying the waters with the sorts of issues that I have been facing around Australia with the country task force since the tax was introduced. It is a deliberate attempt to muddy the waters and to put before people positions which have no bearing at all on the fringe benefits tax. Let me go through one or two things quite specifically. The fringe benefits tax does not apply unless five criteria are met. The first is that a benefit has to be provided. The second is that it has to be provided by an employer. The third is that it has to be provided to an employee. The fourth is that the benefit has to be over and above the wage or salary paid to that employee. The fifth is that it has to be in a form that is not deductible in the hands of the employee. Those facts are not expressed by anybody on the Opposition side when they talk about fringe benefits. They just lump together the whole tax reform package and point to the problems that they perceive with the fringe benefits tax, which problems are mainly in their minds and not in the minds of others. But we need to analyse the tax reform package and look at some of the figures. Firstly, we should look at the Budget Papers to see what amount is collected from pay as you earn taxpayers. The Leader of the Opposition (Mr Howard), when he was Treasurer, said: Fairness demands that employees who are paid solely in cash . . . I include amongst those people those who declare their fringe benefits; there are plenty of them in the community. I will raise a point on that in a moment. Pay as you earn taxpayers pay into the Treasury coffers $22,404m. The former Treasurer spoke about people who were obtaining their income partly in cash and partly in the form of valuable benefits of other kinds. An amount of $540m is the estimate of collections from those people, the majority of whom do not declare those benefits for taxation purposes. They represent 2 1/2 per cent of the population. The Leader of the Opposition and members of the Opposition are prepared to go in to bat for that 2 1/2 per cent of our population. They did a similar thing with the assets test and they are now back batting for their mates, their friends, who for many years have been avoiding their responsibilities in this country. Members of the Opposition would not go in to bat for those people in such a way if they did not think that they had something to gain. The Prime Minister (Mr Hawke) has said today that the Government will look at unintended consequences of the fringe benefits tax and at amendments to it. That has always been the position of the Government. We do not seek every detail, but what we seek to know from members of the Opposition is whether they believe, as John Howard said in 1980, that in all fairness these people should be obliged to pay their share of taxes when 97 1/2 per cent of the population pay PAYE tax to the Government. Why is that 2 1/2 per cent of the population so important to the Opposition? Why are Opposition members so keen to go in to bat for people who want to have a privilege that other members of the community do not have? It is common knowledge throughout society that this has been a growing problem with our taxation system. We have watched fringe benefits provided by all sorts of means to those people on high incomes who, as the Treasurer (Mr Keating) pointed out last week, can be offered a beneficial income of some $105,000 and yet have a taxation liability equivalent to that of a person earning $11,500. The honour- able member for Bennelong now takes the position that he wants to defend that 2 1/2 per cent of the population in that position. As I have clearly pointed out, quite obviously, that is not fair and it has to be brought to an end. The Leader of the Opposition challenged me to talk about a farmer who has to borrow to pay tax on his son's benefit. Last Friday night I was invited to the Gippsland electorate to speak to a group of farmers on one issue-- Mr Simmons —Where is the member? Mr CUNNINGHAM —He is not even here to listen to the debate on the fringe benefits tax. He was not even at the meeting. But his opponent, the candidate for the Liberal Party of Australia, was there. He is an accountant. He sat in the front row. The meeting became very embarrassing for him because it was set up in such a way that the farmers thought that they could score a lot of points on the issue. But what happened at that meeting of 60 people to discuss the fringe benefits tax was that, when asked to consider the five positions for a fringe benefits tax, only four out of those 60 people were affected by the FBT. One of those persons, the one who was to lead the attack, stood up with his tax sheet and asked me: `Has 26 (e) been eliminated?'. Mr Simmons —Was it Peter Nixon? Mr CUNNINGHAM —No, it was not Peter Nixon but it was a person from the same area. I told him that section 26(e) no longer exists. He then proceeded to read from his tax stamp sheet for his employee. He had taken the tax stamps out. He showed the figures for board and lodging. What he did not realise was that he is one of the honest men-there are thousands of them in the community who are not in that 2 1/2 per cent figure-and had taken the correct tax stamp amount from his employee. He had been so disturbed by the rumours put to him by members of the Opposition that he really thought that he would have to pay the fringe benefits tax. He honestly thought that he would have to pay tax a second time. That is the sort of distortion that members of the Opposition have put about in a deliberate effort. For months they have been deliberately misrepresenting the tax to country people who are facing a downturn in their commodity prices in the same way as are our coal producers. We do not deny that the rural sector of Australia faces serious problems. But people in the rural sector should not have to be worried by misrepresentations from a political party which purports to represent rural people. Ms Jakobsen —Opportunism. Mr CUNNINGHAM —It is an absolute disgrace; it is opportunism. I wish to make a few more points. It also came out quite clearly at that meeting that every employer in the rural sector who provides a house for an employee, by his own action in putting in an application to deduct from his income the expenses of maintaining that house, declares that house for employment purposes. The Government does not ask the employer to declare that house. The employer declares that the house is being used by an employee and that the employer wants a deduction for spouting repairs, painting and the normal maintenance expenses for which he is entitled to claim. But these asset rich and income poor people seem to object to putting on the other side of the ledger the fact that they draw an income from that house; by their own declaration, that house is provided to an employee. They clearly take the view that, on the one hand, they should be able to claim the house as a deduction and, on the other hand, to consider it as a freebie. They say that the provision of the house is of no benefit to them. But, if they do not declare the $100 a week as income, they are deliberately avoiding declaring to the Commissioner of Taxation genuine income that should be subject to tax. One can see that an employer has a distinct advantage in encouraging payment in kind rather than in cash. The bleatings from some sectors of the community which say that this is unfair on employers are absolutely ridiculous. I also have here today a telex from Australian Associated Press that concerns me greatly. It is headed: LGPA advised members not to pay FBT. It states: . . . Australia's biggest rural organisation today advised its members not to pay the fringe benefits tax. The Livestock and Grain Producers' Association of New South Wales decided this on the first morning of a three-day meeting of its general council in Sydney. The LGPA represents 22,000 farmers and graziers in New South Wales. Mr DEPUTY SPEAKER(Mr Leo McLeay) — Order! The honourable member's time has expired. The time for the discussion is concluded. Mr MILTON(La Trobe) —On behalf of the Standing Committee on Environment and Conservation, I present the report of the Committee on relocation of naval facilities to Jervis Bay, together with copies of the extracts of the minutes of proceedings. Ordered that the report be printed. Mr MILTON —by leave-This report is the result of inquiries which the Committee decided to conduct as a consequence of a statement by the Minister for Defence (Mr Beazley) and a joint statement in late 1985 by the Prime Minister (Mr Hawke) and the Premier of New South Wales on proposals to relocate naval facilities from Sydney. It was stated that the Royal Australian Navy armament depot at Newington would be relocated to Jervis Bay and a study would be conducted for the re-establishment of a base for the fleet, submarines, mine countermeasure vessels and patrol boats. Our concern was to make sure all the proper planning and environmental considerations were given due weight in the Government's decision. While no public hearings were held, the Committee conducted inspections of the Jervis Bay area and naval establishments in Sydney and at HMAS Stirling in Western Australia and discussions were held with defence personnel, local councils, conservation organisations, Aboriginal groups and government departments. The Committee in the Twenty-ninth Parliament presented a report in 1975 on development pressures on Jervis Bay and recommended that any proposal to develop naval facilities be subjected to an environmental impact statement, and if it could be demonstrated that a more suitable alternative site exists, the Government should not agree to the proposal. The present Committee agrees with this recommendation. Jervis Bay is at present relatively free of major development and is highly regarded as a natural environment with scenic beauty, important conservation and recreation sites of scientific and archaeological significance. There is also a number of Aboriginal sacred sites about which concern was expressed. The Committee was very mindful of the concerns regarding the possible despoliation of these features if development is allowed and this was of uppermost importance in deliberations on the proposals. Present naval facilities in the area, namely, the Naval College HMAS Creswell and the bombardment range on Beecroft Peninsula, have been established for many years, have blended in with the environment and have been accepted by the local residents. However, there is some opposition to further development because of the possible detrimental impact on the environment. The relocation of the armament depot from Newington is essential because of the inappropriateness and inefficiency of the present site. The Committee believes that it does not necessarily mean that relocation should be to Jervis Bay, nor is the Committee convinced that future technological developments of munitions storage have been taken into account. In the view of the Committee, further studies are required into stores and ordnance facilities, with other sites being examined, before any final decision should be reached. A decision about the armament depot should not lock the Navy into a decision about the relocation of the fleet base. It should be noted that in his report on the Review of Australia's Defence Capabilities tabled in the Parliament on 3 June this year, Mr Paul Dibb found that, while there are some potential operational benefits for the Navy in the use of Jervis Bay, an accelerated move out of Sydney Harbour would not be justified by any pressing strategic imperative. The Navy advised that, subject to the completion of a modernisation program, the fleet base in Port Jackson would be capable of adequately accommodating a fleet of the present size into the twenty-first century. The location of an operational base so near to the centre of a large modern city may pose environmental and strategic problems, particularly in wartime, but there does not appear to be any urgent need to relocate major fleet elements to Jervis Bay. The results of a study established by the Minister for Defence to examine the possible re-establishment to Jervis Bay of the fleet facilities at Garden Island, the submarine base and the patrol boat and mine warfare base are expected in the near future. The Government is then expected to decide whether relocation to the Bay should be pursued further. The Committee is concerned that this study will not be subject to public review, that it is based on the assumption that relocation will proceed and that Jervis Bay is the only possible location. This assumption may well turn out to be correct, but it does not appear to have been subject to detailed investigation within the Navy. The Committee understands that the study now nearing completion is very limited and is being carried out by two or three officers based in Canberra. Clearly, a matter of such vital strategic importance deserves much greater attention. The Committee's main concern is that the Department of Defence is proceeding with an EIS on the Jervis Bay site before it has demonstrated whether the relocation proposals are necessary or that the bay is the best site. No evidence was given to the Committee to show that a comprehensive planning study of facility requirements or of alternative locations has been undertaken. The Committee considers that resources should not be committed to an EIS until public comment has been sought or the report of the Department's study has been reviewed. An EIS then should only be prepared when a case for relocation and reasons for the selection of the preferred site have been presented. Consideration of the Dibb report and decisions on the submarine and mine countermeasures facilities should also be finalised before the EIS is commenced. All honourable members will be aware of the controversy relating to the recent Army land acquisition proposals. I am sure that the Senate committee could reach similar conclusions about the Navy proposal. There appears to be no urgent need to relocate the fleet, especially as Garden Island and HMAS Waterhen are being upgraded and some submarines are to be stationed in Western Australia. The Committee recommends that the EIS on Jervis Bay be undertaken only when a comprehensive planning study and public review of naval requirements and alternative sites demonstrates that relocation to the bay is necessary and any development be in the context of the overall proposal for fleet facilities around Australia. The Committee would support further development at Jervis Bay only if it was shown to be completely necessary, there were no other suitable sites and if environmental impacts were minimal. The need to protect the environment is of vital importance. I would like to express the Committee's appreciation of the assistance given by the Department of Defence and the Royal Australian Navy. Their briefings and discussions were both frank and full. We would also like to express our congratulations to the Navy on the attainment of 75 years of meritable and honourable service to the Australian people. I also thank the Secretariat for its assistance in the inquiry, and in particular Mr Ron Kropp, who was responsible for organising the Committee's inspections and discussions and had prime responsibility for drafting the report. I commend the report to the House. Mr WEBSTER(Macquarie) —by leave-In speaking to this report, I wish to explain why it should be necessary for the Standing Committee on Environment and Conservation to state the obvious. As the report notes, the Committee in the Twenty-ninth Parliament reported to Parliament on the development pressures on the Jervis Bay area in October 1975, 11 years ago. The Committee advised Parliament that, although Jervis Bay had the potential for development as a deep water port, its use for such purposes could not be justified in the light of development potential of the existing major ports in New South Wales, and the environmental degradation which would result in the bay. The Committee also found that the Jervis Bay area's primary value as a national resource lies in its development potential for recreation and scientific reference purposes, and large-scale expansion of naval facilities at Jervis Bay would not be compatible with this objective. The Committee recommended that if it could be demonstrated that a more suitable alternative site for such development existed, the Government should not agree to the proposal. It called for the development of a comprehensive Jervis Bay area management plan to be implemented in consultation with the Government of New South Wales and the Shoalhaven Shire Council. Finally, it recommended that any such proposal be subjected to an environmental impact study. A decade after the tabling of that report, there is still no Jervis Bay area management plan, and the development and management plan for the Jervis Bay nature reserve drafted in 1979 is still to be published. Notwithstanding this sorry state of affairs, the Government has decided to relocate the Naval Armament Depot from Newington in New South Wales to Jervis Bay and the Department of Defence, currently examining options for relocation of our Fleet Base, has made its preference for Jervis Bay very clear. This report confirms the conclusions of the 1975 report and the view of the Department of Territories and the National Trust of New South Wales, among others, that the Jervis Bay area is of significant scientific, conservation and recreational value. Nevertheless, the Committee has indicated that it would support further development of the Bay area by the Navy where the Navy could prove such development was absolutely necessary. Of particular importance would be evidence that there were no other sites available. This report indicates, however, that thus far no such evidence or proof has been provided to either the public or to this Committee. Indeed, I would like to note briefly the evidence to the contrary which the Committee had before it. Firstly, a 1979 Garden Island modernisation impact statement which favoured Port Jackson over Jervis Bay, provided there were no major fleet expansions or nuclear warships berth requirements; secondly, the findings of the Dibb Review of Australia's Defence Capabilities this year that, while there are some operational benefits at Jervis Bay, the substantial expenditures of dislocation involved in relocation would not be justified by any pressing strategic imperative; thirdly, the fact that partial fleet relocation to Western Australia in terms of the Government's two-ocean Navy strategy would seem to obviate the need to relocate from Port Jackson. The report indicates that the Committee is of the opinion that the recommendations of the 1975 report are still applicable, particularly that large scale expansion of naval facilities would not be compatible with the management of Jervis Bay as a natural area. The report also recommends that any such expansion of naval facilities be subjected to an environmental impact statement. However, environmental impact statements are time and resource consuming and such a statement in this case could cost in excess of $1m. The Committee has therefore been forced to state the obvious-that the Department of Defence should concentrate its efforts on developing a comprehensive and integrated facilities requirements master plan, rather than proceed with an EIS based on the assumption that relocation is necessary and must occur at Jervis Bay. I hope that honourable members will take notice of this report. It should not be necessary for a parliamentary committee to advise a Minister and his or her department that before he or she takes a course of action he or she examine whether it is absolutely necessary and whether alternative options are available. I ask honourable members to note this report because the 1975 report, to which I have referred, also stated the obvious. Yet its obviously necessary, sensible and simple recommendations have been ignored or implemented at a snail's pace. It would seem that the Parliament has been negligent in its oversight of the implementation of the report and therefore of its stewardship of the Jervis Bay area. I hope that its attention to the simple recommendations of this report will put an end to that neglect. Mr CHYNOWETH(Dunkley) —by leave-I wish to speak briefly about the environmental impact that relocation of naval facilities to Jervis Bay might possibly have on this very beautiful area of Australia. I had never been to Jervis Bay until the Standing Committee on Environment and Conservation went there, but I found the waters in the area to be exceptionally crystal clear. It is a magnificent site for any port and any recreational activities that may take place. Some 30 years ago Western Port Bay used to be similar. It had crystal clear water, beautiful seagrass and white, sandy beaches. I can remember swimming near the Cowes Pier when I was a lad and there was seagrass all around it. Since the development of Western Port Bay and the anchoring of thousands of oil tankers there, the waters have been stirred up and there is increased turbidity. The sunlight does not get through and the seagrass no longer grows there. This has affected fish and other forms of marine life which once lived in this area. I know from experience that that water is no longer nice and clear. I would hate to see that sort of thing happen to Jervis Bay. I have pointed this out to the Royal Australian Navy and I am certain that if there ever were any relocation it would take these factors into account. It is very important that this particularly beautiful part of Australia be preserved for future generations. The Committee also went to Newington in Sydney Harbour. The relocation of the armament base there is a must. Local councils have allowed development right up to the wire around the base and in some places ammunition is stored only 100 metres from a huge glass wall. If an accident occurred and one of these bunkers exploded, havoc would be created in that area. Therefore, this base must be moved. Another matter of concern to me was the destruction of part of the Drummond Drumsticks-a rocky outcrop just off Jervis Bay which has been used for bombing practice over the years. This was drawn to the attention of the Minister for Defence (Mr Beazley), and it is being examined. I believe there will be no further use of this particular landmark, which was an aiming area for both the Royal Australian Air Force and the Royal Australian Navy when dropping their bombs. It is a beautiful area, it should be looked after and we should do all we can to maintain it. I wish to congratulate the Navy on its 75 years of existence. Many people have forgotten that the Royal Australian Navy was established by the Australian Labor Party and I believe that the Government should be proud of that. We were the ones who initiated the RAN and brought it into being. Mr SINCLAIR(New England-Leader of the National Party of Australia) —by leave-The Standing Committee on Environment and Conservation deserves to be commended for the report that it has brought forward, although there are some problems in the character of future naval movements and I wish to alert the Committee to them. I share the general concern about the status of Jervis Bay, which has been described by several members as unique. The waters are crystal clear and the sand has unique characteristics. It really is a quite magnificent part of Australia. However, having said that, I think that it is equally necessary to look at the long term planning of naval facilities around Australia. I say to the Department of Defence that I think it is absolutely essential that it take on board the consequences of the lessons learned from the land acquisition schemes for Army training facilities in New South Wales. There were a number of very serious and adverse consequences for the district, the environment and landholders, some of whom are still waiting to be told that land acquisition will not proceed. For example, the people in Cobar have not been told that their land is no longer required for military purposes, although a report has been brought out saying that the land is no longer suitable, and despite the recommendations of the Dibb Review of Australia's Defence Capabilities and the nature of the terrain. In my view Jervis Bay is in a somewhat different position. As has been mentioned, there is little doubt that the Newington facility in Sydney Harbour must be transferred soon. If it is to be transferred, it is necessary to determine the alternative sites to the port of Sydney for a naval facility, particularly for that munition handling facility. In my view Jervis Bay is the preferable location and I suggest that there has been established a criterion which shows that it is an absolute necessity for the facility to be removed and that Jervis Bay is a suitable location, given the naval facilities already there. Secondly, it is no use looking only at the Stirling base in Western Australia and saying that because facilities can be moved there and because some submarines will be there that one can therefore leave HMAS Platypus, the naval submarine facility at Kirribilli, there forever. Of all the naval facilities it is apparent that when the new generation of submarines comes into service it will be essential that they be moved to an east coast base somewhere outside the port of Sydney. I suggest that once again Jervis Bay is the most suitable location. Therefore, it is necessary, with both those facilities and whatever future transfers may be necessary, for there to be a long term plan brought forward. As I understand the Committee's report, it is saying that an environmental study should be produced once that decision has been taken. It would be very helpful if the Royal Australian Navy were to bring out a long term plan, looking at not only the Jervis Bay facility, but also every other naval facility around Australia and identifying what it believes to be the long term objective for each facility. For example, I suggest that there is reason for some upgrading of the port of Darwin, where obviously there could at least be a frigate berth. I believe that the Port Hedland facility should also be looked at. I have always had doubts about its suitability for patrol boats because of the narrowness of the channel, but there does need to be a facility in the north-west of Western Australia. HMAS Stirling, which is outside Fremantle near Garden Island in Western Australia, is magnificent. It can and will be developed. Again, the natural environment, which is absolutely charming, needs to be protected to the maximum. As we move around the coast, a number of other facilities need to be examined. The Navy should be required to produce a long term plan as to how it sees its progressive establishment. Some of the facilities in Sydney, I believe, will be there indefinitely. I believe that the nature of Garden Island, for example, for all the pressure that I know is on it, is such that it should remain for naval purposes. However, there is a problem in the short term. The two instances that I mentioned-that is, the Newington facility and the future east coast submarine base-are such that I see Jervis Bay as the prime alternative site, and I hope that the Committee and the Parliament will lend a sympathetic ear to the Navy's requirements for I believe that the proper development of Jervis Bay for those purposes, taking into account the unique environment and the requirements of the Navy, should facilitate the development that will help the Australian defence forces, protect the natural environment to the maximum and protect the interests of the residents of that part of New South Wales. Mr SHARP(Gilmore) —by leave-I rise this afternoon to speak to this report because much of the area that will be affected by any possible moves of the Royal Australian Navy to the Jervis Bay area lies within the electorate of Gilmore. Previous speakers have quite accurately described this as a unique and most attractive part of the Australian coastline. All of us, as decent Australian citizens, should be concerned about how this part of the world is likely to be developed. There is no doubt that the Navy has been a good manager of the land that it has held in the Jervis Bay region since about 1914 when HMAS Creswell was established. I do not think people who are prepared to travel into that area and over some of the Navy property could disagree with the fact that the Navy has looked after the area that it holds extraordinarily well. One only has to compare it with other areas that have been developed by either private enterprise or other groups to see that if development is to take place in this part of the world the Navy is a preferred developer because of its track record of good environmental management. A number of speakers today have spoken about some aspects of the development. The honourable members for Dunkley (Mr Chynoweth) has mentioned that the Westernport Bay area was a lovely part of the world when he was a lad but now it has been unfortunately made not so. The point we have to remember is that that development was undertaken by private enterprise, I understand, with oil tankers and so forth being the main sources of activity there. This is not likely to be the case at Jervis Bay. The Navy will be the main developer and it will be ensuring that any activities that are undertaken will be carried out with the utmost care and responsibility. I am pleased with the recommendations that the Committee has put before the House today. I believe it is important that all Australians realise that the Navy is planning its future not just for the next 10 or 20 years but for many, many years ahead. It is important that we all remember that what the Navy is talking about in relation to Jervis Bay will not happen tomorrow; it is talking about it happening in maybe 10, 15 or 20 years. Nothing will happen overnight. I hope that the Navy will give clear evidence to the Committee, the Parliament and the people of Australia that it has investigated other sites and does not look all the time towards Jervis Bay. From informal discussions with Navy personnel in the region I know that they have been looking at upgrading the Navy's presence in the Jervis Bay area for a long, long time, in order to try to meet the future needs of the Navy. I am quite sure that they will be able to give evidence to the Committee, when they are asked, to indicate that they have looked at a number of other sites. I believe that if the moves that the Navy proposes go ahead they will be welcomed by the local people in the Jervis Bay-Shoalhaven district. From speaking to the local council, many business people and members of the community I know that they look forward to the increasing presence of the Navy. There is no doubt that the Navy personnel have been good citizens of the Shoalhaven district. I believe that if the move goes ahead it will be welcomed; it will be a welcome move for Australia's defences and for our Australian Navy. Mr BRUMBY(Bendigo) —I present the thirteenth report from the Publications Committee sitting in conference with the Publications Committee of the Senate. Copies of the report have been circulated to honourable members in the chamber. Report-by leave-adopted. Debate resumed from 25 September, on motion by Mr Hurford: That the Bill be now read a second time. upon which Mr Carlton had moved by way of amendment: That all words after ``That'' be omitted with a view to substituting the following words: ``whilst not declining to give the Bill a second reading, the House is of the opinion that- (1) the Government's taxation policy, in particular its fringe benefits and capital gains taxes, is causing damage and confusion to business and farmers; (2) the Government's failure to deliver tax cuts on 1 September 1986 as promised in 1985 has caused additional hardship to families, and (3) this Government is the highest taxing Government in history with tax receipts estimated to reach 25.5% of GDP''. Mr TUCKEY(O'Connor)(4.36) —The Income Tax Rates Bill is necessary to implement the Government's new proposals which it puts under the heading of tax reform. I choose to put them under the heading of a money grab. There is no evidence whatsoever that in the reduction of these rates the Australian people will be better off. There is certainly no evidence of reform. I believe that reform is not just change; reform is change for the better. We have seen other examples today of the Government backing and filling and trying to debate its way out of situations. The Australian people now are fed up with the hard sell that is practised by the Prime Minister (Mr Hawke) and his Treasurer (Mr Keating) in matters economic and in matters of taxation; they are looking for the bottom line. Let us look quickly at a couple of the bottom lines that are relevant to this legislation and the Government's tax approach in general. The reality is that in the last Fraser Budget, the only Budget that was inherited by this Government-it did not inherit the next one, which was only of its own making-the people of Australia were taxed $44,000m. That was the highest total ever taxed in 83 years of government, I might add. In the Budget which has just been introduced and for which this is enabling legislation, we find that the total of taxation raised from the Australian people is $71,000m. That is an increase in just four years of $27,000m, or 61 per cent. What is more, it represents 25.5 per cent of our gross domestic product, compared with the highest ever figure under a Fraser government of 24.6 per cent. If someone thinks 0.9 per cent is not much money, let me say that in terms of GDP one is talking of a situation in which every one per cent represents something like $2,500m. It is a huge burden. Over a period this Government has been interested in one thing and one thing alone-winning the argument. Its attitude is: Do not be confused by the facts; win at all costs. We had a classic example of it recorded at page 320 of the Hansard of 20 August when the Prime Minister was trying to argue his way out of the clear example of his Government being the highest taxing government in the history of Australia. He said: If we turn to page 358 of Budget Paper No. 1, we see that tax as a proportion of GDP in 1981-82 was 24.7 per cent. If we adjust the 25.5 per cent- that is this Government's taxation- for 1986-87 for the financing of Medicare, it comes out at 24.6 per cent. I wonder what in the heck he thinks we are on about. How dumb does he think the Australian people are? The Medicare levy is a tax. It is consuming $4,000m-plus of Australian taxpayers' money this year. The Prime Minister wants to make adjustments by throwing out part of the tax that he is imposing on Australia through these measures. Let me look at some of the other recent examples of winning the argument. The Treasurer recently could not even tell the Australian taxpayers whether the $200 charge that he is now imposing for taxation appeals would be returned to the taxpayer if that person won the appeal. One would think that he would know that. Only the other day he came into the Parliament to mislead totally the Australian people by saying that only private kilometres had to be recorded in log books. One has only to look at the so-called approved log book and the legislation the Treasurer brought into this Parliament to see that that is not so; that business kilometres have to be recorded. When we asked the Treasurer what percentage of the fringe benefits tax he thought the public sector might pay, compared with the private sector, he told us that he was not a computer and he was not expected to know those sorts of things. Now the Treasurer is running around America trying to play the same sorts of tricks over there. It is disgraceful. The Americans must wonder where that man comes from and what he is on about, because he is prepared to tell them fibs. He has gone over there and boasted that he is such a great Treasurer that he got the deficit down from 5 per cent of gross domestic product to just over one per cent and he criticised the American nation because its deficit is still 5 per cent. The reality is that the highest ever deficit over which the Treasurer has presided is 4.3 per cent, which is a difference of just 0.7 per cent or $2,000m. His current Budget deficit is not just over one per cent; it is 1.4 per cent-another $1,000m miscalculation by the Treasurer. That 1.4 per cent deficit presumes that he will not do the same as last year and overrun his deficit projection by a mere $800m. There have been 33 Budget deficits in Australia and only 11 of them have exceeded $800m, let alone been overrun by $800m. There is every reason to say that the deficit this year will probably be 2 per cent. If we look at the more realistic comparison with America and add in the public sector borrowing requirements, because American State governments do not run the same sorts of borrowing programs as we do in Australia, we are looking at an original figure of 6.8 per cent and a current figure of 4.9 per cent, which is surprisingly like the American figure of 5 per cent. That is the reality, but this Treasurer is all about rhetoric and currently the rhetoric is on tax. We are to be told anything; the Government does not worry too much about explaining the details. Not long ago business was told that it had plenty of money to pay the 3 per cent productivity claim and the superannuation claim associated with that, because business profits had never been higher; but the figure the Treasurer was using was calculated prior to deducting interest rates and taxation. Everyone knows how those two matters have escalated under this Treasurer. Let us look at the reduced taxation scales the Treasurer is offering Australians, which are significant in some respects. The tax free threshold will rise from $4,595 to $5,100. The rate will reduce from 25 per cent to 24 per cent on the small amount of earnings up to $12,600 and on the intervening amount up to $19,500 the rate will reduce from 30 per cent to 29 per cent. The poor people will get only a one per cent cut, remembering that this Government constantly claims that they are the people it represents. For earnings between $19,501 and $28,000 the rate will drop from 46 per cent to 43 per cent and for earnings up to $35,000 it will drop from 48 per cent to 46 per cent. For the very wealthy, those who earn over $35,000-only the top 2 per cent of Australian taxpayers are in that bracket-the rate will drop from 60 per cent to 55 per cent. Let us look at the harsh reality of those magnificent figures. If we look at what an average weekly earner will pay as a percentage of his total earnings, we discover that under the Fraser Government an average weekly earner-a husband with a wife and two children-paid 17.5 per cent of his total earnings in taxation. That is the bottom line; that is what he understands-not all the fancy figures that have been bandied around by the Treasurer, who will always find some figures to prove something. When all these lovely tax deductions about which the Prime Minister boasts so much are in place, the average weekly earner will be paying 20.5 per cent of his income in taxation, because in that period we have had fiscal drag and inflation and we have pushed him up into the higher brackets. The rate in the bracket in which the average weekly earner will be will not be reduced substantially, so he has been pushed up into a higher bracket. The bottom line is what the average weekly earner has to take home to spend with small business and other people who need his money. As a percentage of his earnings, he will be 3 per cent worse off under this tax than under the Fraser Government. Even the average weekly earner with no dependants will be one per cent of his income worse off-23.4 per cent compared with 22.4 per cent. There are all these new taxes into the bargain. The fringe benefits tax is `option ACTU' and it is a tax about throwing out the baby with the bath water. Again we have had this program of misinformation. I will give the Acting Treasurer (Mr Hurford) his due; at least he has read something about it and he was prepared to tackle the problem today. At least he had the figures reasonably right-something about which the Treasurer has no idea whatsoever. Every time the Treasurer and the Prime Minister, as demonstrated today, are asked to speak on matters relating to the detail of the tax-the way in which the tax will affect the ordinary Australian, which is surely what we are on about here-they cannot answer because they do not have the capacity, background or experience to understand. At least the Acting Treasurer has some idea of that, because he used to be an accountant; but he was telling us only half the story today. He made a comparison between the fringe benefits tax and substantiation for people who own their own cars. When he was specifically asked about that, he started throwing around percentages and, when picked up on interjection, he had to admit that under the fringe benefits tax the percentage applies to the price of the vehicle. In the transitional year it is expected that people will be entitled to a benefit of 18 per cent calculated on the original value of the vehicle. Mr Hurford —But it is a very generous one. Mr TUCKEY —Whether or not it is generous, it has nothing to do with keeping a log book and substantiating the claim. A business person wishing to claim a tax deduction on a vehicle either will have to keep a log book or will be able to claim only one-third of the operating cost or 12 per cent of the total price of the car. As the questioner today tried to point out, there is certainly some evidence that the benefit is very much to the corporate employee compared with the small businessman, because the corporate employee will be taxed on 24 per cent of the original value of the vehicle, if he opts for the formula; but the owner will be able to claim only 12 per cent of the original cost as a business cost. He will be taxed on 88 per cent and the corporate employee will be taxed on 24 per cent, or down to 6 per cent. There is a vast difference there, as the questioner today tried to point out. The Government has got it wrong again because it is neither fair nor equitable. There are different deals for one side and the other. I stand here today as the unashamed representative of the small business sector. Those businessmen and I know that the only way in which they can get a fair deal out of this arrangement is to keep the log book with nine entries every day. God save the poor individual who was driving around in his car on the day the Treasurer got up here and, in an attempt to misrepresent the tax, to dress it up in clothes it is not entitled to wear, told businessmen that they could just record the private kilometres. Now we have something called self-assessment, which is all about telling the Commissioner of Taxation anything you like and he will believe you for the time being; he will take it as read until he sends out a field auditor. So, if a person has claimed major deductions against a log book kept as the Treasurer advised, with only private kilometres recorded in it, under the laws introduced by this Government the field auditor would have every right to reject the claim for a deduction. That means that the individual is left without any evidence of his business kilometres, and it is possible that seven years will pass before the individual discovers that he has it wrong. After all, the Commissioner will not tell him. I have in my hand his little booklet entitled `Income Tax Self Assessment', a properly issued booklet and one of the hundreds that are burdening business. We are told what the old law was. The old arrangement was that the form was lodged with the Commissioner of Taxation and he, on the basis of the information disclosed in the return, confirmed that the taxpayer had correctly applied the law in calculating his or her taxable income and in claiming rebate. On the next page, we move on to the proposed self-assessment system. The passage reads: In its essentials, self-assessment will not involve a big change. Basically it means; The Commissioner need not (and in the main, will not) check the taxpayer's application of the law before issuing a notice of assessment. If the individual listens to some of the interpretations of the Treasurer and gets his self-assessment wrong, the Commissioner will not tell him that it is incorrect before issuing the annual assessment. He will accept the taxpayer's word. It should be remembered, however, that the field auditor will be able to knock on the taxpayer's door up to seven years later, and that there are three years in which reassessment can be made on any ground, including the following four, if it is said that the taxpayer has submitted misleading information. If the individual has made a claim that is not within the interpretation of the law, he has misled the Commissioner and is a tax evader. If that has happened, he is one of the horrible people that Government members constantly talk about. This is what the public is up against and this is what the law is doing. The public will not derive any particular benefit from what is being proposed. Instead, people will pay more in taxation, and much more than they did under any conservative or coalition government. That is the reality and that is the bottom line. The self-assessment proposals are not surprising when we consider the lack of experience in business administration among the occupants of the present Government front bench and their total inadequacy. With the exception of about one Minister, the occupants of the Government front bench do not know what it is all about, and that comment applies also to doing a hard day's work. Ministers are neither of the workers nor of the business community, who are the only contributors in our society to producing a real dollar. Ministers do not understand these matters and they have introduced proposals for self-assessment without the necessary guidelines. They have left people standing on a one-legged stool with a noose around their neck, and I do not think that they will keep their balance very long in that position. The public is being misled. That can be said especially of the Treasurer, who has gone overseas to try to mislead the world's major financial institutions. Why has he done that? He is trying to prove to the American President that he is better than his counterpart and his colleagues in the United States. What a joke that is. This so-called tax reform has not come about because of the tax summit in July. It is the result of the Government's instructions from the Australian Council of Trade Unions. I remind the House of the speech of Bill Kelty of the ACTU on 3 February, six months before the tax summit took place. The relevant article states that he foreshadowed: . . . a push by the ACTU for a government crackdown on perks such as company cars, expense accounts and education fees enjoyed by executives and an expansion of the taxation pot into currently non-taxable areas. The Government received its instructions from the ACTU and it delivered. Mr DEPUTY SPEAKER(Mr Millar) —Order! The honourable gentleman's time has expired. Mr HURFORD(Adelaide-Minister for Immigration and Ethnic Affairs and Acting Treasurer)(4.55) —I shall speak to the amendment, Mr Deputy Speaker, to remind the House that the two Bills before it, the Income Tax Rates Bill and the Income Tax Bill, will declare and impose respectively the rates of income tax payable by individuals and trustees generally for 1986-87, for 1987-88 and for subsequent years. Anyone who listened to the honourable member for O'Connor (Mr Tuckey) would not know that that is the issue. An amendment has been moved by the shadow Treasurer, the honourable member for Mackellar (Mr Carlton) which is rhetorical and not very constructive. It seeks to make some political points and it does not give credit where it is due. It should be recognised that significant tax cuts will be made available to the Australian people. They were announced as part of the tax reform package and they will apply from 1 December 1986. The honourable member for O'Connor can rant and rave as he might like in speaking to the Bills, and presumably to the amendment as well, and charge members of the Government with not having business experience, but I would suggest that I have had just as much business experience over the years as he has. I think that I am slightly older than the honourable gentleman, although I may have worn well, and I have probably had more business experience than he. I also have a great deal of taxation experience. Mr Porter —Did you ever make a profit? Mr HURFORD —I am not insolvent yet. Mr Porter —You said that you were not in land because you did not make a profit, remember? Mr HURFORD —I do not remember the details of those things but I am prepared to-- Mr Porter —I remember it well. It was when you were having a go at Lynch. Mr DEPUTY SPEAKER —Order! I invite the Acting Treasurer to ignore the interjections, with which the Chair can deal. I invite the Minister to speak more specifically to the amendment. Mr HURFORD —I suggest that there is no way in which the House could accept the amendment. It does not address, for instance, the great value of the two Bills that are before us, and it is rhetorical in nature. I hope that I shall remain within the Standing Orders if I refer to the contribution of the honourable member for O'Connor. I suggest that his comments were wide of the mark and not properly constructed on the details of self-assessment. In the past week I have visited one of the great capital city offices of the Australian Taxation Office to monitor how self-assessment is being introduced and I can report that I am happy with what I have seen. It is my understanding that I would not be within order if I were to talk about the Bills that are before us. I am receiving certain messages from you, Mr Deputy Speaker, and I recognise the time and the needs of the House. Before bringing my remarks to a close, however, perhaps I would be in order in addressing a question that was posed by the honourable member for Dawson (Mr Braithwaite) in speaking to the amendment. Would I be in order in responding to that question, Mr Deputy Speaker? Mr DEPUTY SPEAKER —Yes, if the Minister's remarks relate to the amendment, which is fairly wide ranging. Mr HURFORD —We shall have to see whether they so relate, Mr Deputy Speaker. I shall, of course, accept your ruling if you pull me up short. When the Bills were being debated previously, the honourable member for Dawson asked a question on 25 September. He wanted to know whether in the circumstances certain allowances would be taxable, and he referred to a travelling allowance. Such an allowance received by an employee is subject to the provisions of income tax law and would form part of the employee's assessable income against which appropriate deductions may be allowed for the cost of meals, accommodation and incidental expenses incurred by the employee while travelling in the course of his employment. On the other hand, a living away from home allowance is a taxable fringe benefit and accordingly it is exempt from the employee's income tax. The taxable value of the allowance to the employer for fringe benefits tax purposes is reduced by so much of the allowance in the nature of compensation for reasonable accommodation costs and food expenses incurred by the employee. There is a reference to fringe benefits in the amendment but because the allowances are subject to different taxation treatments it is important to distinguish between them. The Commissioner of Taxation has recently issued ruling MT2030 on the subject, which will assist in identifying the allowances and lead to a better understanding of respective tax treatments. It is my contention that the amendment is mere rhetoric and does not address the fact that the legislation contains provisions of enormous value for Australian people in the form of tax cuts. I am now obliged, because of the timing of the business of the House, to move: That the question be now put. Question put. The House divided. (Mr Deputy Speaker-Mr L. J. Keogh) Ayes . . . . . . . . . . . 65 Noes . . . . . . . . . . . 46 —— Majority . . . . . . . . . 19 —— Baldwin, P. J. Jakobsen, C. A. Beazley, K. C. Jenkins, H. A. Beddall, D. P. Kelly, R. J. Bilney, G. N. Kent, L. Blanchard, C. A. Kerin, J. C. Blewett, N. Klugman, R. E. Bowen, Lionel Langmore, J. V. Brown, Robert Lee, M. Brumby, J. M. Lindsay, E. J. Campbell, G. McHugh, J. Chynoweth, R. L. McLeay, LeoCohen, B. Maher, M. J. Cross, M. D. Martin, S. P. Cunningham, B. T. (Teller) Mayer, H. Darling, E. E. Milton, P. Dawkins, J. S. Morris, AllanDuffy, M. J. Mountford, J. G. Duncan, P. O'Keefe, N. P. Edwards, Ronald O'Neil, L. R. T. Fatin, W. F. Price, L. R. S. Fitzgibbon, E. J. Saunderson, J. Free, R. V. Scholes, G. G. D. Gayler, J. Scott, J. L. Gear, G. Simmons, D. W. Gorman, R. N. J. Snow, J. H. Grace, E. L. Staples, P. R. Griffiths, A. G. Theophanous, A. C. Hand, G. L. Tickner, R. E. Holding, A. C. Uren, T. Hollis, C. West, S. J. Howe, B. L. Willis, R. Humphreys, B. C. (Teller) Young, M. J. Hurford, C. J. Aldred, K. J. Hodges, J. C. Andrew, J. N. (Teller) Hodgman, W. M. Blunt, C. W. Hunt, R. J. D. Braithwaite, R. A. Katter, R. C. Brown, N. A. McArthur, F. S. Burr, M. A. McGauran, P. J. Cadman, A. G. McVeigh, D. T. Cameron, Donald Miles, C. G. Cameron, Ewen Millar, P. C. Carlton, J. J. Nehl, G. B. Cobb, M. R. Porter, J. R. Coleman, W. P. Reith, P. K. Conquest, B. J. Robinson, IanCowan, D. B. Rocher, A. C. Downer, A. J. G. Ruddock, P. M. Drummond, P. H. Sharp, J. Edwards, Harry Sinclair, I. McC. Everingham, P. A. E. Slipper, P. N. Fife, W. C. Smith, W. Fischer, Tim Sullivan, K. J. Hall, Steele Tuckey, C. W. Halverson, R. G. Watson, D. J. H. Hicks, N. J. (Teller) White, P. N. D. Lamb, A. H. Shack, P. D. Dubois, S. G. Beale, J. H. Jones, Barry Cameron, IanCleeland, P. R. Shipton, R. F. Hayden, W. G. Hawker, D. P. M. Punch, G. F. Lloyd, B. Keating, P. J. Macphee, I. M. Jacobi, R. Jull, D. F. Charles, D. E. Adermann, A. E. Question so resolved in the affirmative. Question put: That the words proposed to be omitted (Mr Carlton's amendment) stand part of the question. The House divided. (Mr Deputy Speaker-Mr L. J. Keogh) Ayes . . . . . . . . . . . 65 Noes . . . . . . . . . . . 47 —— Majority . . . . . . . . . 18 —— Baldwin, P. J. Jakobsen, C. A. Beazley, K. C. Jenkins, H. A. Beddall, D. P. Kelly, R. J. Bilney, G. N. Kent, L. Blanchard, C. A. Kerin, J. C. Blewett, N. Klugman, R. E. Bowen, Lionel Langmore, J. V. Brown, Robert Lee, M. Brumby, J. M. Lindsay, E. J. Campbell, G. McHugh, J. Chynoweth, R. L. McLeay, LeoCohen, B. Maher, M. J. Cross, M. D. Martin, S. P. Cunningham, B. T. (Teller) Mayer, H. Darling, E. E. Milton, P. Dawkins, J. S. Morris, AllanDuffy, M. J. Mountford, J. G. Duncan, P. O'Keefe, N. P. Edwards, Ronald O'Neil, L. R. T. Fatin, W. F. Price, L. R. S. Fitzgibbon, E. J. Saunderson, J. Free, R. V. Scholes, G. G. D. Gayler, J. Scott, J. L. Gear, G. Simmons, D. W. Gorman, R. N. J. Snow, J. H. Grace, E. L. Staples, P. R. Griffiths, A. G. Theophanous, A. C. Hand, G. L. Tickner, R. E. Holding, A. C. Uren, T. Hollis, C. West, S. J. Howe, B. L. Willis, R. Humphreys, B. C. (Teller) Young, M. J. Hurford, C. J. Aldred, K. J. Hodges, J. C. Andrew, J. N. (Teller) Hodgman, W. M. Blunt, C. W. Hunt, R. J. D. Braithwaite, R. A. Katter, R. C. Brown, N. A. McArthur, F. S. Burr, M. A. McGauran, P. J. Cadman, A. G. McVeigh, D. T. Cameron, Donald Miles, C. G. Cameron, Ewen Millar, P. C. Carlton, J. J. Nehl, G. B. Cobb, M. R. Porter, J. R. Coleman, W. P. Reith, P. K. Conquest, B. J. Robinson, IanCowan, D. B. Rocher, A. C. Dobie, J. D. M. Ruddock, P. M. Downer, A. J. G. Sharp, J. Drummond, P. H. Sinclair, I. McC. Edwards, Harry Slipper, P. N. Everingham, P. A. E. Smith, W. Fife, W. C. Sullivan, K. J. Fischer, Tim Tuckey, C. W. Hall, Steele Watson, D. J. H. Halverson R. G. White, P. N. D. Hicks, N. J. (Teller) Lamb, A. H. Shack, P. D. Dubois, S. G. Beale, J. H. Jones, Barry Cameron, IanCleeland, P. R. Shipton, R. J. Hayden, W. G. Hawker, D. P. M. Punch, G. J. Lloyd, B. Keating, P. J. Macphee, I. M. Jacobi, R. Jull, D. J. Charles, D. E. Adermann, A. E. Question so resolved in the affirmative. Original question resolved in the affirmative. Bill read a second time. Leave granted for third reading to be moved forthwith. Motion (by Mr Hurford) proposed: That the Bill be now read a third time. Mr HODGMAN(Denison)(5.10) —This Government stands condemned for its cowardice in preventing this Parliament from debating fully its own income tax legislation. I think the people of Australia have to understand and realise that we now have in power a Government which is bringing into the Parliament legislation which it cannot understand and cannot explain. It is legislation which is unjust, discriminatory, punitive, ambiguous and bad law. What greater crime is there to commit against this Parliament than to gag the members of this House from the opportunity of fully debating the Government's legislation? It is the most cowardly, disgraceful and scurrilous action ever perpetrated on the people of Australia by any government since Federation. I join with the Leader of the Opposition, the honourable member for Bennelong (Mr Howard), in condemning the Government on its fringe benefits tax legislation, which is unintelligible. This combination of seven pieces of specific legislation is a legal jungle and an accountant's nightmare. The Government is taxing itself out of office. In conclusion, it is only a matter of time before this Government changes the words of our national anthem from Advance Australia Fair to Advance Taxtralia Fair. The Government is taxing itself out of office, it is penalising those with incentive and a wish to achieve in this country and it is doing everything it can to kill enterprise. This is typical socialist dogma. The Hawke socialist Government's death warrant is the fringe benefits tax, together with the broken promises of the Prime Minister (Mr Hawke) made at the Sydney Opera House in 1983. The Government should be worried. I pay my taxes, as do all on this side of the House. There are no dodgers on this side, Mr Deputy Speaker. The plain fact is that this Government's behaviour in relation to taxation is outrageous and disgraceful and it is going to be its death warrant. When the Prime Minister is dragged screaming from the Lodge in just a few months time the taxpayers of Australia will rejoice because they have had a gutful of him and a gutful of the Treasurer (Mr Keating). The sooner the Hawke socialist Government is thrown out of office the better for this country and for its future. Mr REITH(Flinders)(5.15) —I appreciate the opportunity to speak on the third reading of the Income Tax Rates Bill in view of the fact that the Government gagged debate on the second reading. I want to refer to aspects of the capital gains tax as it affects the family home. I think most people listening today have been under the impression that the family home of ordinary Australians would be free from capital gains tax. Let me tell the people of Australia that under Labor the family home will be subject to capital gains tax in 15 different ways. Mr Smith —Tell us. Mr REITH —I certainly will. I take the opportunity to point out some of the many anomalies in Labor's capital gains tax as it affects the ordinary Australian home owner. The fringe benefits tax has been very much the flavour of the month in the last few days. We have seen the Prime Minister (Mr Hawke) today backtracking, left, right and centre. He did not have a clue as to some of the applications of the fringe benefits tax. There are some very interesting parallels between the fringe benefits tax and the capital gains tax. The first parallel is that both are new taxes. No one should have any doubt on what Labor is about when it comes to both the capital gains tax and the fringe benefits tax-it is after as much tax as it can possibly collect. A second interesting comparison is about complexity. Today we have heard the Leader of the Opposition, the honourable member for Bennelong (Mr Howard), talking about the fringe benefits tax. The Prime Minister's only election commitment on tax in 1984 was that he would have a taxation summit. One of the principles of that summit was that we would have a more simple tax regime. Let us look at the FBT. There are 176 pages in the explanatory memorandum and 139 pages in the legislation. That only just pips capital gains tax because we have 155 pages in the explanatory memorandum and 103 pages in the legislation. If fringe benefits tax is a bonanza for paper production and dye makers for red tape, the same will certainly apply for valuers and others associated with having to work out the capital gains tax. There was an interesting article in the Australian yesterday by a Mr Peter Knox, who is director of taxes with Arthur Young and Co., a firm of chartered accountants in Sydney. He stated: More and more taxpayers are becoming aware of the potential impact the capital gains tax will have on their investments. The queries I have received indicate confusion over this tax. That is a pretty good source. We have another comparison on the question of tax receipts. This Government has unquestionably fudged the figures on the fringe benefits tax. It gets even worse on capital gains tax. When it was introduced in September 1985-- Motion (by Mr Hurford) put: That the question be now put. The House divided. (Mr Deputy Speaker-Mr L. J. Keogh) Ayes . . . . . . . . . . . 65 Noes . . . . . . . . . . . 45 —— Majority . . . . . . . . . 20 —— Baldwin, P. J. Jakobsen, C. A. Beazley, K. C. Jenkins, H. A. Beddall, D. P. Kelly, R. J. Bilney, G. N. Kent, L. Blanchard, C. A. Kerin, J. C. Blewett, N. Klugman, R. E. Bowen, Lionel Langmore, J. V. Brown, Robert Lee, M. Brumby, J. M. Lindsay, E. J. Campbell, G. McHugh, J. Chynoweth, R. L. McLeay, LeoCohen, B. Maher, M. J. Cross, M. D. Martin, S. P. Cunningham, B. T. (Teller) Mayer, H. Darling, E. E. Milton, P. Dawkins, J. S. Morris, AllanDuffy, M. J. Mountford, J. G. Duncan, P. O'Keefe, N. P. Edwards, Ronald O'Neil, L. R. T. Fatin, W. F. Price, L. R. S. Fitzgibbon, E. J. Saunderson, J. Free, R. V. Scholes, G. G. D. Gayler, J. Scott, J. L. Gear, G. Simmons, D. W. Gorman, R. N. J. Snow, J. H. Grace, E. L. Staples, P. R. Griffiths, A. G. Theophanous, A. C. Hand, G. L. Tickner, R. E. Holding, A. C. Uren, T. Hollis, C. West, S. J. Howe, B. L. Willis, R. Humphreys, B. C. (Teller) Young, M. J. Hurford, C. J. Aldred, K. J. Hodgman, W. M. Blunt, C. W. Hunt, R. J. D. Braithwaite, R. A. Katter, R. C. Brown, N. A. McArthur, F. S. Burr, M. A. McGauran, P. J. Cadman, A. G. McVeigh, D. T. Cameron, Donald Miles, C. G. Cameron, Ewen (Teller) Nehl, G. B. Carlton, J. J. Porter, J. R. Cobb, M. R. Reith, P. K. Coleman, W. P. Robinson, IanConquest, B. J. Rocher, A. C. Cowan, D. B. Ruddock, P. M. Downer, A. J. G. Sharp, J. Drummond, P. H. Sinclair, I. McC. Edwards, Harry Slipper, P. N. Everingham, P. A. E. Smith, W. Fife, W. C. Spender, J. M. Fischer, Tim Sullivan, K. J. Hall, Steele Tuckey, C. W. Halverson, R. G. Watson, D. J. H. Hicks, N. J. (Teller) White, P. N. D. Hodges, J. C. Lamb, A. H. Shack, P. D. Dubois, S. G. Beale, J. H. Jones, Barry Cameron, IanCleeland, P. R. Shipton, R. F. Hayden, W. G. Hawker, D. P. M. Punch, G. F. Lloyd, B. Keating, P. J. Macphee, I. M. Jacobi, R. Jull, D. F. Charles, D. E. Adermann, A. E. Question so resolved in the affirmative. Bill read a third time. Debate resumed from 19 August, on motion by Mr Hurford: That the Bill be now read a second time. Question resolved in the affirmative. Bill read a second time. Leave granted for third reading to be moved forthwith. Motion (by Mr Hurford) proposed: That the Bill be now read a third time. Mr HODGMAN(Denison)(5.26) —I am sorry; I did not hear the remarks. Is the Minister saying that if we speak we will be gagged again? Mr Hurford —I-- Mr HODGMAN —Well, that is an absolute scandal, an absolute disgrace and the Minister ought to be ashamed of himself. Mr DEPUTY SPEAKER(Mr Keogh) —Order! The honourable member for Denison will resume his seat. The honourable member for Denison had the call to address the House, not to argue with the Minister across the table. Mr HODGMAN —Thank you, Mr Deputy Speaker. I was provoked by a Minister in a cowardly Government that will not debate its own tax legislation. I understand that there is a time problem. There is certainly a time problem for this Government because time is running out on it. In the light of that, I will not do any more than to say to the House that this is the most cowardly Government in that it will not stand up in this Parliament and debate its iniquitous, unjust, punitive, discriminatory and thoroughly unfair taxation laws. The Government will pay a very big price for this and it will be thrown out of office at the next election. Mr REITH(Flinders)(5.27) —Before I was gagged in the previous debate, I was referring to estimates given by the Treasurer (Mr Keating) on capital gains receipts. This is very interesting because, when the Bill was introduced, the Government was talking about receiving about $25m from the capital gains tax. But when the Treasurer wrote to his colleagues before the National Conference of the Australian Labor Party in Hobart in July, it was not $25m as the estimate for receipts from capital gains tax; it was $300m-- Mr Rocher —How much? Mr REITH —It was $300m. I think that the people of Australia will want to know where this $300m is going to come from. Quite clearly it will come from ordinary Australians and they will pay through the nose on Labor's capital gains tax. No one should have any doubts whatsoever that this Labor Party will be out there with its hands in the pockets of ordinary Australians and it will be taxing the family homes of tens of thousands of Australians. Let me give a very simple example. Mr Hurford —Mr Deputy Speaker-- Mr REITH —I think the Acting Treasurer (Mr Hurford) wants to gag me again and I register my protest. Motion (by Mr Hurford) put: That the question be now put. The House divided. (Mr Deputy Speaker-Mr L. J. Keogh) Ayes . . . . . . . . . . . 65 Noes . . . . . . . . . . . 45 —— Majority . . . . . . . . . 20 —— Baldwin, P. J. Jakobsen, C. A. Beazley, K. C. Jenkins, H. A. Beddall, D. P. Kelly, R. J. Bilney, G. N. Kent, L. Blanchard, C. A. Kerin, J. C. Blewett, N. Klugman, R. E. Bowen, Lionel Langmore, J. V. Brown, Robert Lee, M. Brumby, J. M. Lindsay, E. J. Campbell, G. McHugh, J. Chynoweth, R. L. McLeay, LeoCohen, B. Maher, M. J. Cross, M. D. Martin, S. P. Cunningham, B. T. (Teller) Mayer, H. Darling, E. E. Milton, P. Dawkins, J. S. Morris, AllanDuffy, M. J. Mountford, J. G. Duncan, P. O'Keefe, N. P. Edwards, Ronald O'Neil, L. R. T. Fatin, W. F. Price, L. R. S. Fitzgibbon, E. J. Saunderson, J. Free, R. V. Scholes, G. G. D. Gayler, J. Scott, J. L. Gear, G. Simmons, D. W. Gorman, R. N. J. Snow, J. H. Grace, E. L. Staples, P. R. Griffiths, A. G. Theophanous, A. C. Hand, G. L. Tickner, R. E. Holding, A. C. Uren, T. Hollis, C. West, S. J. Howe, B. L. Willis, R. Humphreys, B. C. (Teller) Young, M. J. Hurford, C. J. Aldred, K. J. Hodgman, W. M. Andrew, J. N. (Teller) Hunt, R. J. D. Blunt, C. W. Katter, R. C. Braithwaite, R. A. McArthur, F. S. Brown, N. A. McGauran, P. J. Burr, M. A. McVeigh, D. T. Cadman, A. G. Miles, C. G. Cameron, Donald Nehl, G. B. Cameron, Ewen Porter, J. R. Cobb, M. R. Reith, P. K. Connolly, D. M. Robinson, IanConquest, B. J. Rocher, A. C. Cowan, D. B. Ruddock, P. M. Downer, A. J. G. Sharp, J. Drummond, P. H. Sinclair, I. McC. Edwards, Harry Slipper, P. N. Everingham, P. A. E. Smith, W. Fife, W. C. Spender, J. M. Fischer, Tim Sullivan, K. J. Hall, Steele Tuckey, C. W. Halverson, R. G. Watson, DavidHicks, N. J. (Teller) White, P. N. D. Hodges, J. C. Lamb, A. H. Shack, P. D. Dubois, S. G. Beale, J. H. Jones, Barry Cameron, IanCleeland, P. R. Shipton, R. F. Hayden, W. G. Hawker, D. P. M. Punch, G. F. Lloyd, B. Keating, P. J. Macphee, I. M. Jacobi, R. Jull, D. F. Charles, D. E. Adermann, A. E. Question so resolved in the affirmative. Original question resolved in the affirmative. Bill read a third time. Debate resumed from 19 August, on motion by Mr Hurford. That the Bill be now read a second time. Question resolved in the affirmative. Bill read a second time. Leave granted for third reading to be moved forthwith. Motion (by Mr Hurford) proposed: That the Bill be now read a third time. Mr HODGMAN(Denison)(5.38) —This is the most detailed and most important Bill of the lot. Again, it is being gagged by a cowardly Government which will not debate its legislation in the Parliament. Mr DEPUTY SPEAKER(Mr Keogh) —Order! I remind the honourable member for Denison that this is a third reading debate, not a second reading debate. He should confine his remarks to those appropriate for a third reading debate and not discuss the general nature of the Bill or make the sorts of remarks appropriate to a second reading debate. The Chair has tolerated this action on two previous occasions. I remind him on this occasion that he should adhere strictly to remarks relevant to a third reading debate. Mr HODGMAN —Thank you, Mr Deputy Speaker. I had no intention of transgressing your ruling in my speech on the third reading. But there has been no debate either on the second reading of the Bill or in the Committee stage because this Government has gagged debate. The opportunity for members to speak on the third reading is-- Mr DEPUTY SPEAKER —Order! The honourable member for Denison will resume his seat. Mr HODGMAN —On what basis, sir? Mr DEPUTY SPEAKER —The honourable member for Denison will resume his seat. I have told him that he should adhere to remarks relating to particular clauses of or schedules to the Bill. He is speaking in general terms on the Bill. If he wishes to refer to specific clauses of the Bill, he may do so. Mr HODGMAN —I welcome the invitation. The Government has requested me to keep the speech to one or two minutes because it is running scared and will not debate. I would like now to debate in some detail the clauses as the Chair has invited me to, but the point is that that process is contrary not only to the Standing Orders but also to the practices of this House. Motion (by Mr Hurford) proposed: That the question be now put. Mr HODGMAN —You are gagging debate. Mr DEPUTY SPEAKER —The honourable member will resume his seat. Question resolved in the affirmative. Original question resolved in the affirmative. Bill read a third time. Debate resumed from 19 August, on motion by Mr Hurford: That the Bill be now read a second time. Mr PORTER(Barker)(5.42) —The Medicare Levy Bill breaks yet another of the firm and unequivocal promises made by the Prime Minister (Mr Hawke) before the last election. Over the last three years commitments have been made by the Prime Minister and the Minister for Health (Dr Blewett) that there would be no changes to the Medicare levy. In his 1984 Australian Labor Party policy speech, the Prime Minister said: And I now give this undertaking-that for the term of our next government, the Medicare levy will not be increased. It was increased. As recently as six months ago the Prime Minister said: I confirm that the Government has no plans to change the Medicare arrangement. The Minister for Health said last year: Medicare is an important element of the prices and incomes accord, and the Government is committed to maintaining the levy at one per cent. Time after time the Government has confirmed its undertaking not to increase the levy, but today in this legislation it seeks to increase the levy by 25 per cent. The list of this Government's broken promises grows by the hour. `There will be no new capital gains tax', said the Prime Minister in his policy speech. Of course, there now is one. He promised a drop in interest rates. They have gone up. The Prime Minister promised a 3c per litre cut in petrol prices. They have gone up. In November 1984 the Prime Minister said that inflation would be kept under 5 per cent. It is now over 8 per cent. He promised no increase in the Medicare levy and he has put it up 25 per cent. I cannot think of one promise made by the Hawke Government in its mad grab for power that it has actually kept. This is the most dishonest, contemptible government this country has seen-and after Gough that is saying something. When the Minister for Health originally outlined the Medicare proposal to the Australian people, he said: `It would be funded by a one per cent income tax contribution'. The Government has systematically and intentionally promoted Medicare on the basis of this false assertion. It clearly intended to mislead the public into believing that the one per cent levy would actually fund Medicare. In one of the biggest frauds perpetrated on this country, people were told that as a result of their payment of a one per cent levy they would receive a green-and-gold plastic Medicare card which they could present to their doctor, public hospital out-patient department or public hospital admitting department for health care, which was to be `free' if the doctor bulk billed. The fact is that the levy has never come close to paying for Medicare, and the gap between the income generated by the levy and the exploding cost of the Medicare program continues to grow. The Government has merely used the levy as an excuse further to increase the tax burden. This highest taxing government that this country has ever seen has now lifted our top tax rate from 60 per cent to 61 1/4 per cent. Let us look more closely at that capacity of the levy to finance the Medicare program. This year's Medicare budget is predicated on the fact that it will cost the Government $4,000m to provide medical and hospital services under Medicare-and how much will the levy raise? It will raise $1,645m. So the Government has a $2,355m financial credibility gap to fill. Around 23 per cent of our population are entitled to Medicare benefits by virtue of the fact that they are pensioners, unemployed, or in some other way financially disadvantaged. Of course, they pay no levy; their Medicare costs are paid out of general revenue. The levy also does not apply to around 12 per cent of taxpayers because they fall below the income threshold to which the levy applies. Around 40 per cent of all Medicare benefits are paid on behalf of those who pay no levy at all, and of course all these benefits are paid out of general revenue, to which all taxpayers contribute according to their taxable income. The amount raised by the levy does not even cover the medical costs of those who pay the levy because their health costs are also subsidised by general taxes. In other words, they are funded out of general revenue, to which they already contribute by way of the graduated tax system. The majority of Medicare expenditure is funded from general revenue, not from the levy. Let me put it another way. As I have said, the Medicare levy will raise $1,645m of the $4,000m cost of Medicare, so the levy would have had to be trebled in this Budget to pay for Medicare. It is therefore absolutely arrant nonsense for the Government, the Treasurer (Mr Keating) or the Minister for Health to claim that Medicare is self-financing. The Medicare program is funded in the main out of general revenue, and the Medicare levy is nothing more than an additional tax. Any financial relationship which the levy may have borne to the rocketing costs of the Medicare program has long since been left on the drawing board of the program's architects. In summary, financing of the Medicare program through the introduction of the levy represents yet another of the financial myths which have characterised the policies of this Government and its glib and confused Treasurer. Income taxes and other taxes, as distinct from the levy, contribute the major portion of health care costs of the Commonwealth. In the past the Federal Government has concentrated on the provision of health care to those most in need by providing funds out of general revenue without a special levy, whilst providing tax relief for the rest of the community to insure privately. The major difference between this Government's health policy and the past is that it has banned private medical insurance and in its place created a Medicare monster which steadily devours more and more of the taxpayer's dollar. It has replaced choice of health care with socialistic, inefficient, government bureaucracy. It has remorselessly attacked private sector medicine, driving up the cost of private hospital insurance. In so doing, it has forced people out of private insurance and on to long public hospital queues. Labor's Medicare policy has condemned millions of Australians to long public hospital queues. Only those who can afford to maintain private cover have guaranteed access to a bed when they need it. Medicare is the most unfair, inequitable health care system we have had in this country. Low income earners are consigned, under Labor, to second class health care. Our policy will allow people to opt out of Medicare. It is quite wrong for the Government to say that, by allowing people to choose between paying the Medicare levy and taking out private health insurance, this will somehow be inequitable because income taxpayers will still be contributing according to their taxable income to the Federal Government's provision of health care to those who remain covered by Medicare, which will include pensioners and others in need. One of the major problems of Medicare has been the rapid escalation of costs. Under Medicare the Government has provided incentives for rapid growth in the cost of health services. The Government has consistently underestimated the cost of its program. Last year medical costs were $111m or nearly 4 per cent over budget. The initial expenditure figures for this year suggest that the blow-out in health expenditure is continuing unabated. Outlays for medical benefits in July of this year outstripped last July's expenditure by 18.5 per cent, way beyond the Budget forecast of 10.6 per cent for this year. In money terms the Government is spending $1m a day more than last year on medical services-$1m a day more. What makes the situation even worse is that this growth in expenditure is at a time when the Government is supposedly reaping the benefits of the delay to 1 November in increases in the schedule of fees for doctors and the reduction in fees for pathologists. In other words, the Government has totally failed to address the underlying reasons within the Medicare system which have promoted this rapid rate of growth in health expenditure. The Minister for Health and his prized Medicare have been one of the largest contributors to the massive increase in Government spending and the growth in this Government's deficit. He and Medicare will be the Government's undoing. The Treasurer acknowledged the rapid escalation in Medicare costs when he said in his Budget Speech: The Government has taken a range of measures to help contain the growing costs of Australia's health system. But whilst the Treasurer has acknowledged the disastrous Medicare cost blow-out, regrettably he has done absolutely nothing to control or contain those costs. It is totally untrue to present the changes made by the Government in its Budget as cost containment measures. They will not contain the rapidly increasing Medicare costs; they will merely shift some of the cost from the Federal Government to the individual. Certainly this will reduce Commonwealth expenditure, but it will not contain the growth in total health costs. To contain costs, a change to Medicare is needed in order to introduce incentives to keep costs down rather than promoting an increase in health costs, as does Medicare. The Government has reduced its expenditure. How has it done so? It has raised the maximum gap between the medical benefit and the schedule fee from $10 to $20; it has eliminated the $140m bed day subsidy for private hospitals; it has increased the concessional patient contribution from $2 to $2.50 for each pharmaceutical prescription purchased; and it has increased the general patient contribution from $5 to $10 for pharmaceutical prescriptions purchased under the program. These measures merely shift the cost from the Government to the individual. They will not lead to the containment of the growth in health costs. They simply push health care costs around like the uneaten liver on a child's plate. The savings achieved are illusory. The burden has merely been shifted to the patient. The liver is still on the plate. Following the enunciation of these bogus cost containment measures, the Treasurer went on to say: . . . but even with these savings, and particularly with the recent increases in salaries for nurses, the cost of the health system continues to rise. That is an interesting admission. For the first time, after years of disavowing the fact, the Government has finally admitted that hospital costs to the States are in some way related to the Medicare obligation. The Minister for Health has been at great pains in the past to hide the failures of his Medicare program behind what he referred to as `the very clear distinction between the responsibilities of the Commonwealth and the States'. He was shifting the blame to the States. The rapid Australia-wide increase in public hospital queues following the introduction of Medicare was, according to the Minister for Health, all a nasty coincidence. But suddenly the Treasurer, in a blinding flash of brilliance, blew the arguments of the Minister for Health out of the water. He said that increases in nurses' salaries meant increased costs for the Commonwealth. As he had stated that increasing nurses' salaries had had a direct relationship to the Government's financial responsibility to the States under Medicare, one would think that he would increase the Medicare funding to the States for public hospital services provided to Medicare patients. Wrong again. In fact he reduced such public hospital funding by 5 per cent in real terms. The question remains: Why did the Government bring up the issue of increased nursing costs if it had no intention of doing anything about it? The answer is that the Treasurer and the Minister for Health have crudely and dishonestly tried to shift the blame for the 25 per cent increase in the Medicare levy on to the nurses. Nurses' salaries have risen and so, as a result of the devaluation, have the costs of pharmaceutical and medical supplies. These cost increases will add to the difficulties being faced by our public hospital system, which has been savaged by three years of Medicare. Beds have been systematically withdrawn from use, not because there is no demand for beds but because there are no funds to staff and maintain them. In fact Medicare has generated a demand for public hospital beds which far outstrips the supply, as all surgery which is not an emergency is defined as elective, and elective is redefined as postponable. In Victoria alone, 1,500 public hospital beds have been closed, while during the same time, waiting lists have lengthened by a staggering 228 per cent. This Federal Labor Government has shown absolutely no concern for the patients it has put on those queues. The queues for public hospital beds continue to grow and up to 100,000 people around Australia wait to gain admission to a public hospital bed. But the Government has done nothing in this Budget to address the problems in our deteriorating public hospital system; in fact the Government has embarked on a course which is sure to increase the queues for public hospital beds. If this Government were interested in alleviating the burden on our public hospitals, if it were interested in reducing the queues of people trying to gain admission to a public hospital bed for needed surgery, now would be the time for it to make private hospital insurance more affordable. The Prime Minister promised to do just that, but that is yet another broken prime ministerial promise. If, for once, Labor actually did as it promised, people would be able to purchase private health cover and gain affordable access to private hospitals. Thereby it would relieve some of the pressure on the public hospital system. Instead, the Government has in this Budget taken measures to ensure that the cost of private hospital insurance increases. It has removed the private hospital subsidy of $140m and it has slashed the Federal contribution to the Reinsurance Trust Fund from $5m to $1m. In the coming year these two moves will add a significant additional burden to the health insurance funds, and this increased burden will result in increased premiums to those who wish to purchase private health cover. Since under this Budget people are being asked to pay an extra $347m out of pocket for health costs, some people will no longer have the discretionary funds available to meet the increased private health premiums. They will be forced to give up their private cover and will take their place in the queues of those already waiting to get into the public hospitals. For each patient who does join a public hospital queue and who is lucky enough eventually to gain access to a bed in a public hospital, there is a massive financial impact for the Federal Government. While that patient was in the private hospital, a day of care was costing the Federal Government $20 to $40 a day. Now the same day of care for the same patient in a public hospital will cost the taxpayer $280 a day, and all this in the name of making Medicare self-financing. What a farce! If the increase in revenue generated by the new levy rate is not going towards the funding of the public hospital system to help defray the increased costs of nursing salaries, where is it going? The increase in the levy rate will generate an extra $300m which should cover the projected Budget increase in the costs of providing medical services under Medicare. This year it is going to take an additional $275m to feed the insatiable appetite of Medicare's medical service program. The Government has cut more than $98m in benefits from this part of its program in the coming year, and still the costs rage on like a fire out of control. By the end of this fiscal year, the Government projects that the costs of the provision of medical care under Medicare will have increased by more than 40 per cent over the three full years of the program. The terrifying part of this is that there appears to be no end in sight. Nor has the Government done anything to try to staunch this cost explosion except by postponing fee increases, which of course does not go to the heart of the problem. It has not addressed the fundamental flaws in Medicare which are stimulating this blowout in costs. The massive increase in the cost of this program for the coming year presupposes that the growth in the use of medical services will slow, but the Government has given no reason as to why a slowdown will occur. But, then again, for this Government that is par for the course. Last year it predicted that the growth in utilisation of medical services would be around 5 per cent; in fact, it was 8 per cent. This resulted in a $111m Medicare budget blowout. This was made up of $94m overexpenditure in 1985-86; plus, as I predicted, the Government rigged the books by shifting some $17m additional costs from last year into this financial year by slowing down payments to doctors in June. The Budget euphemistically refers to it as `an abnormally high carryover of unprocessed claims'. An abnormally high carryover indeed! The Government is cooking the books. This year's growth in utilisation of medical services has been projected at 7 per cent, down one per cent from last year's experience. This is called the `flattening out' effect. But the Government has not offered us a word of explanation for this prediction of a sudden reversal in the massive growth of medical costs under Medicare. If the increase in utilisation continues at the same rate as last year, we will see another multi-million dollar blowout. The Government must make the changes to the Medicare program which have been called for by the coalition and almost every professional health group in this country. The kinds of changes that Medicare needs are not the juggling of the books to dress up the Budget deficit, changes which increase revenue here, transfer costs there. The kinds of changes that Medicare needs are changes in direction, changes that begin to slow the massive Medicare growth in costs, changes which provide incentives to contain costs rather than the open-ended Medicare bulk billing system which promotes overutilisation of medical services, and changes to redress the imbalance in demand for private and public hospital beds by allowing people to opt out of Medicare as proposed by the coalition. Is it not obscene that we allow empty private hospital beds and long queues for public hospital beds in this country, all as a result of Medicare? The coalition will make these changes. We will allow people to choose between, on the one hand, Medicare and its levy and, on the other, taking out private health insurance. We will free up the private health insurance sector to encourage competition and innovation in the delivery of cost effective, high quality health care services. It is only in a competitive environment that the forces for true cost containment will be maximised. Financial incentives need to be provided for doctors to keep people well and out of hospital rather than treat them only when they are sick. We need to provide incentives to maximise efficient care and reduce hospital costs. We need to promote better health. None of these objectives are met by Medicare. In fact, Medicare provides incentives for overutilisation and penalises many health professionals who wish to promote better health. I am delighted that the Minister for Health has belatedly recognised the Medicare cost explosion and he now talks about introducing health maintenance organisations. But he is proposing to introduce HMOs within the context of Medicare, and that is a farce. There will be no cost containment by introducing HMOs within Medicare. That is a step towards employing doctors on a salary. It is another step down the road to the British national health system, and what a terrible system that is. HMOs within Medicare will not work. One of the major incentives required for an HMO to work is that the benefits of cost containment be passed on to the consumer, the health insurance contributor, by way of lower premiums. How can there be a lower premium with a compulsory levy? As I said, HMOs within Medicare will not work. The coalition is determined to create an environment in which there are incentives to contain costs whilst providing greater access to higher quality care. The Government has done nothing in this Budget to address the basic flaws in Medicare. Therefore, I move: That all words after `That' be omitted with a view to substituting the following words: `whilst not declining to give the Bill a second reading, the House- (1) condemns the Prime Minister for breaking his promise that, for the term of Labor's next Government, the Medicare levy would not be increased; (2) notes with concern that the Government continues to perpetuate the myth that the levy pays for Medicare health services when in fact it only pays approximately 40% of the cost of Medicare, with the balance being funded out of general revenue, and (3) condemns the Government for its total failure to take action to contain the massive blow-out in Medicare health costs'. Mr Tuckey —I second the amendment. Mr MAHER(Lowe)(6.10) —We are dealing with legislation to increase the Medicare levy from one per cent to 1.25 per cent as a Budget measure. In the current financial year the composite rate of the levy will be 1.145 per cent. The legislation will also extend the range of people who do not have to pay the levy. People with larger families who are earning average weekly incomes will not be caught by the levy at all. People with four or five children will not be required to pay the levy because limits have been set to protect families with low incomes, individuals with low incomes or large families with middle incomes. I wish to say a few words about the comments of the honourable member for Barker (Mr Porter) and his unfortunate undertaking to make changes and to dismantle Medicare should the Liberal and National parties ever get back into office. As everyone knows, when the Australian Labor Party came to office in 1983 two million Australians were uninsured. That had enormous implications for health services and those trying to deliver health services, be they public hospitals, general practitioners worrying about uninsured patients, hospitals trying to collect bills, or people who through ill health, misadventure or bad luck let their health insurance lapse and suddenly found themselves uninsured. It was a total mess. As the Minister for Health (Dr Blewett) pointed out in an answer to a question in the House on 22 September last, if the Liberal Party of Australia philosophy were adopted and people were allowed to opt out of the levy-essentially it is the people at the top end of the levy, the high income earners, who opt out-this would cost $1,600m. That would be the cost if a scheme of Medicare were adopted where one could choose whether or not to join. The essential argument for Medicare is that all Australians should have access to medical and hospital facilities. It is a simple and equitable scheme which is financed by a levy on incomes. The levy is not applicable to every person; essentially it applies only to those who earn more than average weekly earnings, especially if they have a large family. It does not apply to certain categories of people, such as veterans, war widows or those who receive certain defence pensions or emoluments. The honourable member for Barker made an unfortunate criticism of the public hospital system, which I feel I must refute. I have spoken to a senior executive officer and other staff of the Royal Prince Alfred Hospital, which is a very large teaching hospital in Sydney with nearly 1,200 beds. Those people explained to me that unfortunately there are waiting lists, but this is entirely due to the nursing shortage, a shortage which particularly affects New South Wales. Approximately 50 per cent of medical admissions come through casualty, and there is no delay in getting a bed for those people who come through casualty. The problem of waiting lists in public hospitals has nothing to do with Medicare at all; it is essentially caused by a shortage of nurses. The Government, in co-operation with State governments, is trying to recruit nurses from overseas to hospitals here and it is also running a program to retrain nurses. At the Concord Repatriation General Hospital in my electorate a very positive scheme for the retraining of nurses has been running for some time. The notion of choice in the levy may sound very good, but it has appalling implications. It is very unfortunate that the Liberal and National parties have made a commitment to prevent ordinary families from being included in bulk billing. If the Opposition ever got into power, it would confine the Medicare scheme to pensioners and the very poor. That would be a total negation of the right of choice which families should have. People in my electorate who have children often have to go to a general practitioner or medical centre at weekends and they often select one which bulk bills. People should have the right to approach a general practitioner or medical centre where they know they can be bulk billed. It is contrary to the so-called Liberal philosophy of freedom of choice that families will not have the right to be bulk billed. If a family has a child who is sick-say, a diabetic or an asthmatic-they will not have the right to go to the doctor of their choice and have the doctor bulk bill for them. People are often short of money, particularly at weekends or before pay-day, and they should have the right to be bulk billed. The Hawke Government has pledged that Australians will have the right to approach the doctor of their choice, a doctor who will bulk bill them if they so choose. Unfortunately, the Liberal and National parties are rejecting that proposal, and I feel that it is an attack on families and their rights to security in sickness, to obtain treatment without having to find the funds necessary there and then, or having to make a claim and seek a payment. I made the point earlier that the levy does not apply to large families. A family of six can earn $23,300 and be exempt from the levy. That is well above the average weekly earnings. If a family with six children earns more than that, there is a certain shading in, so that up to nearly $25,000 of net income a large family does not have to pay the full levy. The levy starts at $8,300 for individuals and a single parent or family can earn $13,370 before the levy is paid, then $1,660 is added on to the exemption for each dependent child. So the bigger families have the advantage of not having to pay the levy if they are in the middle income bracket. The other matter on which I want to touch is the implication in the comments of the honourable member for Barker that 40 per cent of Medicare treatments are provided to people who are now not paying the levy. I believe that the philosophy and policy of the Liberal Party is nonsense. The Minister for Health, in reply to a question in the House in September, said that the only way the Liberal Party could implement its policy would be by doubling the levy to 2.5 per cent, as is did in 1976 when it introduced a scheme such as the scheme it is talking about now. The Leader of the Opposition (Mr Howard) is talking about abolishing the various taxes introduced by the Government and funding everything by cutting back on Medicare. The other horrendous alternative would be that the Liberal-National coalition would cut back on the free medical care provided to pensioners and the disadvantaged. That would be a disgrace. The members of the Opposition go around this nation saying that they will cut back taxes and abolish this and that, but they have not clearly defined how they would finance such cutbacks in taxes. The only alternatives are either that they double the levy to 2.5 per cent or more, or that they cut back on the provision of free medical care to pensioners and the disadvantaged. It would be a tragedy and a travesty that our old people, our pioneers, would not have the right to free medical and hospital treatment which they now have. The honourable member for Baker (Mr Porter) made a slighting comment about the former Prime Minister, Mr Whitlam, which was uncalled for. Mr Whitlam is a great statesman and a great Australian. I support the legislation that is before the House. I believe that Medicare gives Australians a simple and universal health scheme which is easily understood and by which Australians benefit. I believe also that ultimately the nurse shortage in the various public hospitals will be overcome and that many of the complaints about delays and waiting lists will be removed in the fullness of time. There is a cyclical effect with the different intakes and the additional training year that is thrown in, particularly in New South Wales. The standard of care in public hospitals is first rate and I give credit to those who run the hospitals, those who work in them and those who service the poor, the needy and the families of our country. I ask the House to reject the amendment moved by the honourable member for Barker. Mr McARTHUR(Corangamite)(6.21) —The Whitlam Government set the pace for nation- alised health care in Australia by introducing Medibank on 1 July 1975, and since that time we have seen major variations of that theme. The Australian Labor Party and the socialist planners have tried to convince the Australian people that a nationalised health scheme would provide cheaper and more efficient health services. All the evidence to date indicates that health services cost more and that the delivery is less effective. The recent Budget decision to increase the Medicare levy by 25 per cent signifies a change in both the attitude of the Government and the background philosophy which supports this socialist myth. When Medicare was first introduced on 1 February 1984, the one per cent levy on personal income provided for the payment of medical benefits, free hospital care and a subsidy to all patients in private hospitals. The change announced in the 1986 Budget increases this levy by 25 per cent and does not guarantee public hospital treatment for all citizens, and with the removal of the private hospital subsidy it ensures that private insurance will rise. The total health budget for Australia in 1986-87 will be $7.3 billion, plus identified health grants to the States of $1.6 billion, making a total of $8.9 billion, which is almost $9 billion for Australian health care. As the Government has been successful in promoting the view that the Medicare program provides free health to all Australians and that the Medicare levy in fact covers this provision, Parliament should look very carefully to the content of this false proposition. The truth behind the health budget and the contribution from the one per cent levy for Medicare is that Medicare in the current Budget will generate $1.6 billion, which is 18 per cent of total health outlays across Australia, both Commonwealth and State. This is a far cry from the perception of taxpayers and their families that their Medicare levy entitles them to free health care from doctors and hospitals. The Government has been quick to claim the credit for a universal health scheme, but is reluctant to take the responsibility for the problems faced by the State health administrations in providing health services. In Victoria, for example, queues grow on a daily basis and currently hospitals have waiting lists of approximately 28,000 persons seeking hospital treatment. In Victoria, with the advent of the Labor Government in 1982 and the introduction of Medicare, the State health system is now in a state of chaos, which clearly indicates that nationalised medicine under Labor governments does not work. The Medicare levy as indicated in the Budget Papers will be increased from 1 December 1986 from one per cent to 1.25 per cent of taxable incomes that exceed certain thresholds. As a result, government revenue will rise from $1.28m in 1985-86 to $1.645 in 1986-87, an increase of 23.2 per cent. This Labor Government has proclaimed loudly its record on tax reform, but on this issue it has increased taxation in a very subtle form, again throwing away one of its major promises-that it would not, in any circumstances, increase the Medicare levy from one per cent. In reality, the increase of the Medicare levy is another form of taxation which is directed to general revenues, but is disguised as a non-tax item. The Treasurer (Mr Keating) has no hesitation in increasing this levy as a form of increasing government revenue in his efforts to prop up the Minister for Health (Dr Blewett) and the profligate spending of his Department. Consistent with its socialist philosophy, the Government has now discriminated against the private sector by removing the hospital bed subsidy for private hospitals as from the August Budget 1986. The Government claims that it will save $129m in a full year because it has removed the $40 a day subsidy for each bed in a private hospital. In reality the Federal Government is saving money by assisting private hospitals, because across Australia the average bed cost in a public hospital is in the order of $240 a day. It is ironic that the Government chose to attack the private hospital system when the public hospital system is in a state of disarray. Daily reports in Victoria indicate major problems with nurses' strikes, hospital budget deficits, lack of financial allocations, long waiting lists and low morale in every quarter. The private health system has managed to complement the public health system in a very effective and efficient way in past years. It should be nourished, not destroyed. The Government has been forced to take some remedial action for the blow-out in Medicare. This so-called efficient, equitable health scheme has increased expenditure by 40 per cent over three years. This is a quite remarkable increase in the provision of medical services to the Australian population. Cost escalation is brought about largely by patients seeing doctors on too many occasions and, secondly, by the public perception that doctors' services are free and that the Government will pay. In any nationalised health system the delicate and responsible relationship between doctor and patient is removed. The socially responsible attitude engendered by generations of professional service by the doctors and hospitals has been demolished in two short years by Medicare. The Budget Papers indicate the magnitude of the Budget blow-out. The budget for medical services in 1984-85 was $2.5 billion compared with the $3.2 billion that was forecast in the 1986-87 Budget. This is a dramatic increase for a government and a Treasurer who claim that they have introduced a Budget of restraint and responsibility. Australian taxpayers have the Medicare levy extracted from their pay packets, along with other tax commitments. A person on average weekly earnings of $425 pays approximately $221 per annum by way of Medicare levy. If this person seeks to maintain freedom of choice and insures under private health scheme arrangements, he or she will be paying approximately $327 in insurance premiums to maintain that freedom of choice option. This makes a total of $548 to ensure the health of his or her family. Since 1971, private health insurance has dropped from 77 per cent of the population to only 50 per cent of the population being covered in 1984. The favoured socialist concept of bulk billing is pursued vigorously by the present Minister for Health. Bulk billing ensures that doctors are reduced to a common level of professional performance and that their salaries will inevitably be determined by government authorities. This contrasts with the coalition's attitude that medical practitioners are entitled to be rewarded in the free market for their skills and long years of training. The coalition will bring to an end the current Medicare arrangements and substitute an alternative health system. Incorporated in this system will be incentives for patients to seek a quality service and exercise freedom of choice for both their own doctor and hospital care. The coalition will change the emphasis to a program of preventive medicine. In undertaking this approach, the coalition will endeavour to change attitudes towards health care and promote sensible lifestyles and proper diet and exercise so that the nation's health bill can be contained. Social academic planners, far removed from the real world of Australia's health delivery services, should not be allowed to destroy a system which has been developed over the last four decades. Individual Australians wish to retain their independence in health matters. They reject the notion that health care should be nationalised, centralised and computerised. Sitting suspended from 6.30 to 8 p.m. Dr KLUGMAN(Prospect)(8.00) —Before the suspension of the sitting for dinner the honourable member for Corangamite (Mr McArthur) in speaking on the Medicare Levy Bill made the impressive point that 28,000 people were allegedly on the waiting list for hospital beds in Victoria. Whilst I do not have the 1986 figures, it is important to remember that back in 1981-82 there were some 16,000 public hospital beds in Victoria and the number of occupied bed days totalled some four and a half million. The important thing to remember is that there is only a very short waiting time. These days people spend an average of only a week to 10 days in hospital. Much of the waiting time is due not to a lack of beds but to the fact that surgeons are not available or patients with particular conditions are not admitted quickly because they are not considered to be urgent cases. I do not want to go into that aspect but I do want to point out that, with nearly 80,000 public beds in Australia, waiting lists of some thousands do not matter that much. As I have said before, doctors put people on hospital waiting lists without any real intention of ever having them admitted. There are long waiting lists for operations such as tonsillectomies for children but in a high proportion of cases by the time the children come to the top of the list they no longer need the tonsillectomy. It is often in the patient's own interest to be on a waiting list. Many people here would know of my reservations about Medicare. It tends to enshrine fee for service payment for medical services. Of course it is only a compulsory health insurance scheme paid for on a progressive basis, and I support that aspect strongly because more come from those who have high incomes and those with low incomes receive complete exemption from payment. However the bad thing is, as I have said, that it does tend to enshrine fee for service payment. Because the patient does not pay, the doctor can collect much more than he could under other schemes. Therefore there is no real pressure to change the system. Medical practitioners will milk such a scheme-as would other occupational groups if they were given the same opportunity. There is therefore a tendency to provide unnecessary medical services, including consultations, pathology services, ultrasound and any other new technologies plus, most importantly from the point of view of disadvantage to the patient, unnecessary surgery including anaesthetics. Nearly every female between the age of 10 and 50 years passing through the portals of certain medical practices has a pregnancy test; everybody has a blood count; and, no matter what the symptoms, one has a good chance of having blood biochemistry performed. If one has ever coughed or wheezed, spirometer tests are taken and repeated at monthly intervals. I have no doubt that CAT scanners, magnetic resonance imaging machines and lithotripters to destroy symptomless stones in the urinary tract would probably pay for football clubs, other than those in the Victorian Football League. I personally believe, though the Department of Health does not share this view, that bulk billing is one of the features of Medicare encouraging overservicing. Some patient moiety-that is, some co-payment by the patient-would act as a brake. Of course one would have to continue free medical services for those with low incomes but we have to recognise, because such a high proportion of medical services is delivered to those who are entitled to free medical services anyway-for example, pensioners, including age pensioners because as one gets older one needs more medical services-that that would probably contribute only some $30m to erasing the cost. Nonetheless, $30m is a fair bit of money. An alternative and much more preferable system is that broadly described as being based on health maintenance organisations. I congratulate the Minister for Health (Dr Blewett) on his recent support of that type of service. The official definition of a health maintenance organisation is: An organisation that accepts contractual responsibility to provide a range of health care services to a voluntarily enrolled population in exchange for a predetermined, advance payment by government, individuals or by third parties. The amount of payment for each member is not affected by the frequency, extent or kind of health services they require. This system is most popular in the United States and it is interesting to note in passing that in the United States some 85 per cent of all health insurance is paid for by employers under awards. The employers have found that they are paying a very large amount in health insurance. Recently the Ford and General Motors companies found that the cost of health insurance is greater than the cost of the steel and other metals in their cars. It amounts to approximately 20 per cent of the retail price of a car, so it is a high proportion of the total costs. In practice, for those who could not follow the definition-it was probably a legalistic definition-in the health maintenance organisation system a group of medical practitioners, including most of the specialties, offers its services to individuals or families on the basis of providing complete health cover at so much a year. It is then in the financial as well as the professional interests of those doctors to keep their patients as healthy as possible. The pooled money is divided amongst the participating doctors no matter how many services they provide. The cost of hospitalisation is carried by the pool and therefore paid for by the doctors. Total costs for HMO members are about 30 per cent less than for Blue Cross members-that is, those involved in fee for service insurance in the United States. In the United States the general hospital bed day utilisation rate is 940 bed days per 1,000 population, while for HMO members it is 424 bed days per 1,000. It is much less. In Australia, which by the way has a younger population and therefore should have less bed days per head of population, the rate is 1,484 bed days per 1,000 population. It is well over three times the rate for HMO members and about 50 per cent higher than the rate for the general population in the United States. Part of that is a result of the failure of politicians to make these points, and oppositions tend always-I am sure we did it-to blame governments for any hospital waiting times. Nearly every local member-I exclude myself-pushes for a hospital in his area because he feels that getting a hospital is a great achievement. All it means is that facilities are being provided for the medical profession which are probably not required. The average cost in an acute diseases hospital in Australia is in the order of $280-plus per day, so one can see the potential savings. A huge amount of money is being spent on hospitals. Of course there is a risk of underservicing associated with health maintenance organisation methods of payment vis-a-vis current overservicing. This would, of course, be prevented if people had a free choice between different systems. It is important to realise that if figures are taken from the United States America and if equal populations are compared-in other words, if people are compared on the basis of being in the same age group, of the same sex and with the same history-it will be seen that, for instance, women over 40 years of age have two and a half times greater chance of having a hysterectomy if they are privately insured with Blue Cross, which corresponds to our fee for service, compared with health maintenance organisations, and they have over three and a half times the chance of having surgery on their backs when they have a backache. So if a person wants to get the correct diagnosis from his doctor and is not terribly keen on surgery, it may be best to tell the doctor in the first instance that he is not privately insured. I do advocate the establishment of HMOs provided there is a safety net to catch those unable, because of financial or other reasons, to make a choice of cover. If it is possible to fund HMOs via Medicare, so much the better. I do not believe that hospital services should be separated from HMOs, otherwise there would be a strong temptation for HMO doctors to offload all medically expensive patients on to the public hospital system, which tends to happen under the United Kingdom capitation system. If a doctor gets a patient with even an infected boil or a carbuncle which involves dressing every day, he does not get paid extra for it is so he tells the patient to go to the local casualty department and get it dressed because it is much better when it is done at the hospital. We have to be careful about that. I think that the concept of HMOs is a very rational approach to try to combine medical practitioners' professional incentive to provide the best care with a financial incentive. Currently the financial incentive is all the way to overservicing. The financial incentive ought to be the other way. I congratulate the Minister on pushing the HMO concept. I hope that some are established soon, that the peculiarly Australian problems can be overcome and that we can evaluate their performance and decide what system is really the best for this country. Mr McGAURAN(Gippsland)(8.12) —I wish to draw the attention of the Parliament and more particularly the attention of the Minister for Health (Dr Blewett) to the perilous position in which Victoria's bush nursing hospitals find themselves as a result of the combined effects of Medicare and government decisions. It is no exaggeration to say that some 25 out of 37 of Victoria's bush nursing hospitals find themselves imminently in danger of closure. The reason can be traced back to the original introduction of Medicare during 1983. As honourable members would be aware, all members of the Australian community earning a salary or a wage at that time had to pay one per cent in medical insurance. That immediately resulted in a very significant proportion of the Australian population opting out of private health insurance, which meant that bush nursing hospitals, mostly situated in relatively isolated areas, had an immediate drop in clientele. This situation was exacerbated in the 1986 Budget, delivered on 20 August, because the decision by the Government was to withdraw the private hospital bed subsidy. The Government's subsidy was some $167m, of which only $4m went to Victoria's bush nursing hospitals. It saddens me that the Minister for Health and his Department have demonstrated a lack of appreciation of the uniqueness of Victoria's bush nursing hospitals. There seems to be almost total ignorance on their part of the role of these hospitals in relatively isolated communities. Mr O'Keefe —Rubbish! Mr McGAURAN —There has been an interjection from the honourable member for McMillan (Mr Cunningham). He has two bush nursing hospitals in his electorate-Neerim South and Pakenham. Mr Cunningham —On a point of order, Madam Speaker: The honourable member has totally misrepresented me. I did not say anything at all. Madam SPEAKER —It is not really a point of order; it is a point of explanation. Mr McGAURAN —The interjection was made by a laughing hyena friend of the honourable member for McMillan who is situated next to him. Madam SPEAKER —Order! The honourable member knows full well that the Chair does not like personal reflections. Will the honourable member withdraw the comment. Mr McGAURAN —I withdraw the comment. The honourable member for Burke (Mr O'Keefe), who interjected, laughed at the suggestion that Victoria's bush nursing hospitals were encountering problems. The simple fact is that a number have closed their doors already. One in my electorate, the Toora bush nursing hospital, and a number of others are in imminent danger. There are two bush nursing hospitals remaining in my electorate, Mirboo North and Heyfield. I visited them almost immediately after the Budget on 20 August to try to explore ways in which they could continue. The withdrawal of the private bed subsidy has caused health insurance rates to increase dramatically. Only $4m went to Victoria's bush nursing hospitals, of which it has been estimated that only $1 1/2m is needed to keep the 25 which are in a critical situation afloat. The ignorance that I allege against the Minister and his Department is demonstrated by their failure to differentiate between large private hospitals and bush nursing hospitals. For the information of the Department of Health, bush nursing hospitals are community-owned, non-profit organisations and serve isolated areas. They are not run by a group of avaricious doctors or businessmen. The simple fact is that they serve a community role. They are in small communities throughout Victoria, and are not in other States. For that reason-- Government members interjecting- Madam SPEAKER —Order! I understand that the honourable member for Burke is going to speak in this debate. He might save his ammunition for later. Mr McGAURAN —The honourable member may care to save his explanation for his disparaging remarks about the Victorian Bush Nursing Association for that time, because it is that Association which has publicly called on the Government to assist 25 of its members which may close their doors before Christmas. There was an interjection from the honourable member for Burke or the honourable member for McMillan-they are both sitting on the opposite side of the House and are taking it in turns to try to demean the contribution of a member of this Parliament who represents bush nursing hospitals-along the lines that since the Budget the cost of private health insurance has increased by some 50c in the case of Medibank Private which, it has been alleged, is being underwritten by the Government. But HBA Ltd, Victoria's largest private health insurance company, has increased its costs from $10.32 in February 1984 for a family to $16.88, which is an extra $341 a year. In addition, Medicare contributions rose from one per cent of a wage or salary to 1 1/4 per cent. That means there will be a further drift away from private health insurance funds upon which bush nursing hospitals are now totally dependent. My point is that this Government should recognise the unique and important role played by bush nursing hospitals. There are some 600 beds in Victoria's bush nursing hospitals. If the bush nursing hospitals are forced to close, what will happen to the 600 beds that patients once occupied to the extent of 171,819 occupied bed days in a 12-month period? The answer is as obvious as the question is simple to solve. The patients will have to join the queues waiting for beds in public hospitals. So, out of self-interest, if nothing else, this Government should be committed to keeping bush nursing hospitals in a viable condition. It worries me that the Minister has totally failed to understand the problems of bush nursing hospitals. The bush nursing hospital at Mirboo North, of which Miss Frances Cashin is the Secretary Manager, is a very vital part of that community because it allows not only immediate acute care in its out-patients section but also long term residents and maternity patients to be close to their families. It means that the patients themselves do not have to travel long distances to public or private hospitals and it also means that their relatives do not have to travel the same long distances to visit them. In other words, they remain within their community. This is also the case with the Heyfield Bush Nursing Hospital, of which Mrs Jean Monds is the Secretary Manager. Again, it has a very important out-patients section which sees some 250 to 300 out-patients a month, an average of about 2000 out-patients a year. Heyfield is centred in a timber industry area and therefore there is always the risk-indeed, the certainty-of serious injuries to cutters or other workers in that industry. So, if that hospital closes-as will invariably happen over a period as it draws more and more upon its reserves to keep afloat-those workers will be put at risk because of the difficulty of reaching public hospitals some distances away. The solution is to retain at least the private bed subsidy for bush nursing hospitals. It is not my brief this evening, in the time allowed to me, to argue the case for retaining the private bed subsidy for the private hospital system. Instead, firstly, I argue strongly that a special case can be made out even to this Government, as intransigent as it is, to keep bush nursing hospitals afloat. Secondly, I think the Government needs to look at a scheme of allowing patients in bush nursing hospitals' acute care sections to claim on Medicare. At present most of these out-patients are treated free of charge or for a nominal cost only. Therefore, the out-patients sections of the bush nursing hospitals are a terrible drain on those hospitals' resources. It has to be remembered also that the Victorian Government, through the then Minister for Health, the Hon. Tom Roper, withdrew three years ago capital grants for bush nursing hospitals. So, they have been totally cut off from any sort of government assistance whatsoever; and the only way most of them are surviving is by living off the interest on their investments. Indeed, I know a number of them are already drawing on the capital of their investments. Bush nursing hospitals are unique. They have to be treated as a category of their own and not lumped together with these massive private hospitals, some of which may cause all of us concern in regard to their money-making operations. At present the bush nursing hospitals in Victoria represent one per cent of hospital beds and the Victorian Government will have to find 600 beds in public hospitals-that is an impossible task-if these bush nursing hospitals close. I have met with the staff, management and committee of these two bush nursing hospitals, Mirboo North and Heyfield, on numerous occasions. They are dedicated people and they represent the communities they serve. They are non-profit organisations. These hospitals are owned entirely by the community and see not just their primary role but basically their sole role as one of service to their communities. In conclusion, I seek leave to table a poem by Mr Les Hansfield, who is the President of the Mirboo North Hospital Committee, titled The Bush Nursing Hospital 1985. It is an excellent poem. It is impossible, given its length, to have it incorporated in Hansard but by my tabling it it will be available to honourable members. I await the Minister's reply in summing up on this debate as to why the bush nursing hospitals cannot be treated as a category of their own, far and away from the traditional grouping of private hospitals. I again urge the Government to do this. Do I have the Minister's leave to table this poem? Madam SPEAKER —Is leave granted. Mr Dawkins —It is normal practice to show us beforehand; but, subject to its not offending the Standing Orders, I would not have any objection. Leave granted. Mr McGAURAN —I thank the Minister at the table for that courtesy and I again impress upon the Government the importance to rural Victoria of the bush nursing hospital system. Mr BLANCHARD(Moore)(8.25) —I rise to support the Medicare Levy Bill which is part of a package of Bills relating to the 1986-87 Budget. I want to use a much broader brush than did the honourable member for Gippsland (Mr McGauran). I think that we should briefly return to the recent history of health insurance arrangements in this country. Since the late 1960s, these arrangements have been examined and modified substantially on eight occasions. Additionally, there have been a number of lesser changes which have not substantially impacted on health insurance arrangements. Perhaps the most important, as it was the forerunner of Medicare, was the introduction of Medibank on 1 July 1975. Between 1976 and 1983, the Liberal and National Party coalition reconstructed that scheme so that little of the original scheme remained. The effect of these changes was that many poor people found themselves no longer covered or inadequately covered for health care as a result of the higher costs of health insurance. The introduction of Medicare has taken health insurance arrangements back to the original Medibank principles, except that the levy has been used for funding this scheme rather than the revenue raising measures which Medibank had as a result of the obstruction by the Senate of the original scheme. Today we are discussing the Budget changes which affect Medicare, the principal one being the rise in the Medicare levy from 1 December 1986. If we examine the cost of Medicare over the past year with the projected cost for this financial year, we find that the cost of Medicare services will rise from $2,708.9m in 1985-86 to $2,999.3m in 1986-87. The cost of hospital services will rise from $2,528.6m to $2,713.2m in the next financial year. In other words, the total cost of Medicare will rise by approximately $475m. The increase in expenditure will be partially offset by increased Medicare levy collections. This Government's concern, however, for low income earners is illustrated by the cut-off points from 1 December 1986 at or below which the levy is not payable. These cut-off points mean that a single person with an income of $8,030 per annum will not be liable to pay the levy. This compares with the present cut-off point of $7,526 for single persons. The situation for married couples and sole parents is that the cut-off point will now be $13,370 per annum plus $1,660 per annum for each dependent child. This compares with the present cut-off point of $12,504 per annum plus $1,530 per annum for each dependent child. In addition, the shading-in arrangements will continue to protect people with incomes marginally above the cut-off points from the full impact of the 1.25 per cent levy. In other words, the Government has taken into consideration the financial problems of those on low incomes in meeting that levy. Let us turn to the reasons for the increase in the Medicare levy-an increase that no honourable member on this side of the House welcomes, but we realise that a difficult choice had to be made. The Budget was presented at a time when, because of difficult economic circumstances, the belt had to be tightened. All government expenditure and revenue had to be closely scrutinised, and Medicare was no exception to that rule. Benefits and payments by the State under Medicare cost $3,625m in 1985-86, which was nearly 5 per cent of government expenditure. Given the choice of reducing the deficit by either increasing revenue or reducing expenditure, the Government opted in this case to increase revenue. It preferred this to destroying the essential features of Medicare. The main advantage of this approach is that it preserves the Government's commitment to provide a health insurance scheme based on the principles of fairness, simplicity, universality and cost efficiency. It preserves the 85 per cent rebate and thus, by protecting bulk billing, continues to ensure universal access to necessary medical services. It maintains fairness by ensuring that the burden of paying for health care is spread across the whole community on the basis of ability to pay and does not fall mainly on sick people, many of whom are the most vulnerable in the community. It is also consistent with the Government's call for restraint with equity as the levy arrangements exempt the financially disadvantaged, as I showed earlier, and ensure that the cost of health care is spread throughout the rest of the community. This means that there are no consumer price index effects, with all the consequent flow-ons, as there would have been if other options such as reducing the rebate had been adopted. At a time of falling revenues, it ensures that the inevitable increases in the cost of medical services, which largely follow historical trends, are not paid at the expense of cutbacks in other government programs financed out of general revenue. A number of factors have contributed to cost increases. These factors are worth mentioning in view of some of the alarmist statements made by members of the Opposition. Firstly, under Medicare there has been better access to necessary care. This does not mean that the Government can be complacent. There is still need for further improvements. But a large number of people who previously were uninsured under the disastrous health schemes of the Opposition when it was in government are now covered under Medicare. Secondly, population growth through both natural increase and immigration has caused additional strains on Medicare, as indeed has the aging of our population, which is the third factor and one which, I remind the House, correlates with an efficient health service. The fourth factor is the rapidly increasing number of doctors seeking incomes commensurate with their training and perceived status. Finally, there has been increased average benefit levels for service from greater use of medical technology and specialist services. However, the comments of the honourable member for Prospect (Dr Klugman) in respect of fee for service are worthy of note in this regard. The call that we hear from the Opposition benches for the abolition of a health scheme which is based on the principles of fairness, simplicity, universality and cost efficiency unfortunately illustrates the poverty of health policies within the Liberal and National parties. Medicare provides the equitable way of providing Australians with health cover. I therefore support the Bill. Mr HODGES(Petrie)(8.35) —It is a shame that tonight the Minister for Health (Dr Blewett) is not in the chamber, because the Medicare Levy Bill 1986 is a major piece of legislation that affects the whole of the health insurance industry in this nation. For the Minister not to be present in this chamber is a disgrace. Mr Porter —He is too scared. Mr HODGES —As the honourable member says, he is too scared to come forward-- Mr Dawkins —I take a point of order, Mr Deputy Speaker. As a former Minister, the honourable member knows that it is not always possible for Ministers to attend all of these debates. I am here to ensure that the Minister for Health is made aware of any possibly intelligent comments that the honourable member may make, and I will be delighted to convey them to him. Mr HODGES —I thank the Minister for Trade for his comments, but I suggest to him that an important piece of legislation such as this demands the attention in the chamber of the responsible Minister. The Medicare Levy Bill would be more appropriately termed the Medicare Tax Bill 1986, because it represents an additional tax of 1.25 per cent on taxable income, which is a rise of 25 per cent over and above the one per cent levy which has been in place for two years. The Hawke socialist Government is a big taxing and very big spending government. I point out that the levy has risen by 25 per cent and the services have gone down. Mr O'Keefe —Rubbish! Mr HODGES —It is true. The tax has risen and the services have diminished. Let me point out to the House how this has happened. Two weeks ago in this chamber we debated the Health Legislation Amendment Bill (No. 2) 1986, which provided for the abolition of the private hospital bed subsidy. That will save this Government something to the tune of $143m in a full year. We find that patients now have to pay a maximum of $20 per service, which is up from $10 per service previously. They are just two examples of how services have diminished while the levy has risen from one per cent to 1.25 per cent, an increase of 25 per cent. This big taxing Government has introduced a capital gains tax. It has introduced a fringe benefits tax and does not know where it is going with that tax. It is saving revenue through an assets test on pensioners. I point out to the chamber and to the nation that the Opposition Liberal and National parties, when in government, will repeal the assets test and the fringe benefits tax, or throw it out lock, stock and barrel, as the Leader of the Opposition (Mr Howard) has claimed, and will abolish the capital gains tax. Medicare is costing this nation about $4.7 billion. That is an approximate cost because it is very difficult to pinpoint the exact cost. This levy of 1.25 per cent on taxable income will raise $1.645 billion. The expenditure of $3 billion over and above that will come out of Consolidated Revenue. Therefore, the shortfall-the difference between the $4.7 billion cost of Medicare and the $1,645m raised by the levy-will come out of Consolidated Revenue. In one second reading speech from the Minister he stated that 52 per cent of all medical services under Medicare are bulk billed. I suggest to him that the 52 per cent figure that he cites, and indeed boasts about, is one of which he ought to be ashamed. The Opposition's policy clearly states that pensioners and disadvantaged people will be bulk billed. But people will have the right either to stay in Medicare and pay the Medicare levy or to opt out of Medicare provided that they take out health insurance with a private health insurance fund. At present, because of the desire of thousands of Australians to have private hospital insurance in order to be treated by the doctor of their choice in a hospital of their choice, many people pay much higher health contributions than should be the case. The present Medicare system has only one advantage over the Opposition's policy-only a very slight advantage-and that is that it is simple to operate. It is simple and it is very, very expensive. Any advantage one might obtain from the simplicity of the system is utterly negated by its expense. Let us look at bulk billing, which I believe should be abolished, except for pensioners and the disadvantaged. The present system of bulk billing encourages both patients and doctors to abuse and overuse the system. People should be made more responsible for their own affairs and actions. The Government should get out of their lives as far as possible. There should always be an identifiable cost to the patient for any service and that is, as I have said, with the exception of pensioners and the disadvantaged. Patients and doctors will be careful if there is an identifiable cost. The Opposition's policy is promotion of independence. We will have a nation of people fending for themselves, making their own decisions. But the Hawke socialist Government is about dependence-having a maximum number of people reliant on government and government services. It wants a nation of jellyfish, with no backbone, drifting around aimlessly, being controlled by the Government and the bureaucracy. Medicare is a disaster on two fronts. First, it is a financial disaster. In introducing the Medicare legislation the Minister quite clearly stated that the one per cent levy would substantially fund Medicare. I quote from the Minister's speech in this chamber on 6 September 1983 in which he said: But I do not resile from openly stating that the principles of the Medicare plan are similar to those of Medibank as it was originally introduced in 1975. There are two important differences. Medicare will be substantially self-funding through the one per cent levy and a rearrangement of existing health insurance subsidies, whereas Medibank placed a considerable strain on Consolidated Revenue. I liked his comparison between Medibank, which placed a considerable strain on Consolidated Revenue, and Medicare, which would not do so. I suggest that the Minister should take another look at the figures and see what Medicare is costing the nation in its drain on Consolidated Revenue. Again, in this chamber on 15 May 1985 in the debate on the Health Legislation Amendment Bill 1985, the Minister stated: The additional cost of the Medicare program remains substantially funded through the fair, income-related levy. The words `additional cost' obviously were related to changes to health legislation made in that Bill. But the Minister repeated himself and said that the Medicare program remained substantially funded through the fair, income-related levy. As I pointed out, $4.7 billion is as close as I can get the estimate of Medicare in this financial year. The tax would need to be some 3 per cent if it were to cover, as the Minister has stated, substantially the outgoings of Medicare in the 1986-87 financial year. In addition to the disaster that Medicare is financially, it is also a disaster when it comes to the provision of hospital services. Noone has put the case more convincingly and with a greater number of examples than has the shadow Minister for Health, the honourable member for Barker (Mr Porter). Elective surgery in this country is almost unknown. I have seen figures that vary up to 60,000 and more as to the number of people on waiting lists for operations. Only acute cases are handled in the majority of public hospitals throughout this nation. Yet the Prime Minister (Mr Hawke) told us in unequivocal terms that all Australians will have a bed made available to them in a public hospital. Some 60 per cent of Australians had private health insurance to cover them for hospitalisation. With Medicare this dropped to about 47 per cent, and I understand that the figure has now improved to a little over 50 per cent. I want to make a few comments relative to the operations of Medibank Private and its association with Medicare. There is an unfair advantage that Medibank Private has over the other private health insurance funds due to the joint arrangement of Medibank Private and Medicare. In most instances they have common offices; they have a common staff; there are cash payment facilities for Medicare in Medibank Private offices. Why does not the Minister for Health make more private health insurance funds agents for Medicare? At present they have a one-stop shopping arrangement. This is of great advantage to Medibank Private. If they had more private health insurance funds as agents for Medicare, it would improve the service to the public. Surely that is important to us all. It would break the monopoly of Medibank Private, which, by all standards and evaluations, is unfair. The Voluntary Health Insurance Association of Australia has made numerous approaches to the Minister for Health to have Medicare operate through its agency outlets, but the firm response from the Minister has been no. Management expenses of Medicare and Medi- bank are low because the Australian Taxation Office acts as collector for Medicare. Would the Minister say what charge the Taxation Office makes on the Health Insurance Commission for collecting the $1.645 billion raised through Medicare? If one examines the 1984-85 report of the Health Insurance Commission one notes an apportionment of expenditure between Medicare and Medibank Private. The Auditor-General was very critical of the Health Insurance Commission in the 1984-85 report in the following terms: The Commission has not, however, provided sufficient evidence to enable me to assess the reasonableness of the actual apportionment it has made. Consequently, I am unable to assess the fairness of the apportionment of these costs presented in the financial statements. The total of management expenses for Medicare and Medibank Private is not in question. That is proof that there is an advantage to Medibank Private as a private health fund. I wonder whether the Minister has provided evidence to the Auditor-General since that Auditor-General's report was made. I very much doubt whether he has. I turn to another disturbing aspect of this apportionment of expenditure between Medicare and Medibank Private. I quote again from the Health Insurance Commission's report: This amendment, which has the effect of increasing by $7.588m the costs borne by Medibank Private, is necessary to ensure an equitable distribution. The principles applied in 1984/85 were not determined by the Minister until 21 November 1985. As the Health Insurance Commission Act does not permit retrospective application by the Commission a breach of section 34C(2) has occurred. This clearly indicates that the Minister and the Health Insurance Commission are derelict in their duties. Almost five months of the 1984-85 financial year passed before the Minister determined new principles for apportionment of costs between Medibank Private and Medicare. This is a disgrace involving a Commission that would allow five months of the year to pass and not get directions from the Minister, and a Minister who was not advised adequately to ensure that that aspect of the operations of the Health Insurance Commission was tidied up. The operations of Medibank Private offices in conjunction with Medicare will receive a great boost from the revocation by the Minister for Health (Dr Blewett) as notified in the Commonwealth of Australia Gazette of Monday, 18 August 1986. Appendix H of the 1984-85 Health Insurance Commission report gives ministerial directions relating to Medibank Private under sub-section 8F(1) of the Health Insurance Commission Act 1973. That ministerial direction restricts the number of Medibank Private offices and Medicare offices that can operate in conjunction. This revocation in the Commonwealth of Australia Gazette to which I referred opens the door for Medibank Private, through its association with Medicare, to compete with a substantial unfair advantage over the other private health insurance funds. In effect, Medibank Private is not really a private health fund. It likes to claim that it is, but in effect it is not. So we will see an even greater number of combined Medibank Private-Medicare offices. Obviously, because of financial considerations, they will be able to close offices in positions that are not as accessible as they would like and they will be able to open new offices in highly trafficked areas in our cities and provincial towns. No doubt that unfair advantage will mean they will take a considerable amount of business from the other private health care funds. The 1984-85 Health Insurance Commission report shows that there were 195 joint Medibank Private-Medicare offices and 69 Medicare-only offices, making a total of 264 in Australia. Indeed, there are 12 regionally based private health funds that provide a cash payment facility for a specified range of Medicare services. That is an indication that Medicare has been and should be prepared to extend those payout facilities through private health insurance funds other than Medibank Private. I conclude by drawing the attention of the House to the speech made by the Minister for Health in this chamber two weeks ago on the Health Legislation Amendment Bill (No. 2) 1986 when he stated that, because of accumulated levels of funds in a number of the private health funds, increases as a result of the abolition of the private hospital bed day subsidy should be `moderate'. I quote his words: As a result of this measure, private health insurers will incur additional benefit liability but it is not expected to impact significantly on contribution rates. The exact increases in contribution rates will vary from fund to fund and State to State but, as most funds have accumulated significant levels of reserves, increases should be moderate. That is fine rhetoric. One notes that in the Health Insurance Commission's report, Medibank Private had a total of $131.3m or six months of `break even contribution income'. Yet since that debate the private health funds have announced increases in their contribution rates. I note that in Queensland Medical Benefits Fund has increased its basic hospital table B for a single person by 75c a week and for a family by $1.50. For the top hospital table, which is called BD, the contribution is up 90c a week for a single person or $1.80 for a family. That is an increase of $50 a year for a single person or $100 a year for a family. Those are not what I would term `moderate' increases. Even Medibank Private in Queensland has increased its rates for basic hospital cover for a family by $1.31 a week or $68 a year. For its top hospital cover the rate is increased by $1.52 a week or $79 a year. That points out just how wrong and how misleading the comments of the Minister for Health were in that debate. Mr DEPUTY SPEAKER(Mr Leo McLeay) -Order! The honourable member's time has expired. Mr O'KEEFE(Burke)(8.56) —The honourable member for Petrie (Mr Hodges) made one comment during his discourse that gave some credit to the current Medicare scheme. He said that if it was nothing else at least it was simple. I shall add just three other features which I think tell the whole story in a few words. Not only is the Medicare system simple, but it is also cheap, fair and, most important, it works. I shall come back to the point about its working and talk about the pathetic attempts of the previous Government to introduce a health system to Australia that worked and was cheap and simple. Those are the criteria that the Opposition has established. The Medicare Levy Bill brings about the Budget measure increasing the Medicare levy. I believe that it should be supported and I have no problems in supporting it in the House. I take up the first comment made by the honourable member for Barker (Mr Porter) who opened this debate this afternoon. He referred to the `broken promises of the Hawke Government' on the Medicare levy. He is just the person to stand here and talk about broken promises. If we look at the performance of his Government in the area of health care, the most significant broken promise of the Fraser-Howard years that comes to mind-and I will put aside the great tax grab-back which I thought was the most memorable broken promise-was: `We will not dismantle Medibank'. That was the promise that Opposition members made to the people in 1975. What did we see? We not only saw them dismantle Medibank, but they tried, one after the other, four hotchpotches of medical insurance schemes in an effort to cobble together a scheme that would hold and keep the health care system in Australia in some semblance of order. Of course, they failed. One of the very big planks of this Government, upon which it was elected in March 1983, was the restoration of a universal health scheme and the implementation of Medicare. Medicare is not only one of the promises that have been successfully implemented by this Government, but also one of the features of this Government's successes within the economy. I wish to mention a number of the issues that were raised by both the honourable member for Barker and the honourable member for Petrie. I suppose I should start by focusing on the interests that those members represent. I think it is well known to everyone in this House that the Liberal Party of Australia has always aligned its health policies primarily to appeal to the largest private interests in the health sector-not the ordinary person, not the pensioners, not the sick, not the disabled, but the largest private interests in the health sector. These include private doctors, private hospitals and private health insurance companies. Those are the interests who dictate Liberal health policies and that is why the Opposition will continue to be rejected by the people of Australia. Opposition members are now renewing their noises about destroying Medicare and returning to some mishmash of failed health schemes which existed in the past. What would that mean? It would mean the same as it meant in the past-that the wealthier in our society would pay less for health care and lower income earners would pay more. That is what we can thank Fraser for and that is what we would have to thank Howard for if we were to consider seriously any of his propositions in the health sector. Let us look at some of the features that the Opposition has chosen to highlight in this debate. Once again Opposition members have chosen to focus on the question of health insurance rather than the issue of better health care. That has always been the position in the political debate in Australia. For years the political arguments about health in this country have been about the provision of health insurance rather than the provision of better health care. In other words, they continually focus upon the interests of those who make the dough out of health. Not surprisingly, Medicare has retained its public rating as the popular health system. The fact that it has undergone very few changes in its three-year history makes it the most stable health system in this country in the last decade. That is a point that is worth repeating: It is the most stable health system in this country in the last decade. Not only has it been that but I can tell honourable members opposite that it is here to stay. Let us talk about fraud and overservicing. When one listens to honourable members opposite one may think that fraud and overservicing by doctors and all the others who have been exposed in the last two years by this Government started only in February 1984 when Medicare was introduced. We know that that is nonsense. We know that fraud and overservicing and the problems of the health industry in this area have existed for the last 20 years. Not only have they existed for the last 20 years but also during the Opposition's period in office the problems in our community were exacerbated by the then Government's appalling performance in relation to tax avoidance and its allowing of these people not only to get into this area of fraud and overservicing but also to hide extraordinarily high incomes that were extracted in these ways within the tax system without any semblance of social responsibility or direction by that Government. The Opposition has much to answer for, and I have no doubt that people in Australia will not forget that. Honourable members opposite talk about the cost of health insurance. Not long ago the shadow Minister for Health, the honourable member for Barker, claimed that under the Opposition's health policy it would cost the ordinary family only $400 a year for basic hospital insurance. We know that it already costs $7 a week, or $350 a year, for ordinary family hospital insurance, and that is with a $1 billion Medicare subsidy built into the hospital system. Honourable members opposite are talking about removing that hospital cover. If it alone were removed we would be talking about it costing $700 per year per family. That is double what people are paying now. Let us not sit in here and listen to this nonsense that the honourable member for Barker goes on with. He cannot have it both ways. He cannot talk about saving the $2,500m that he claims the Opposition's policy could save and then talk about funding it in some other way that would not cost people in premiums. It is nonsense, and people know that it is nonsense. We have heard honourable members opposite talk tonight about how they would abolish direct billing. Let us look at that issue. The Liberal Party is the first political party in my memory to come into this House and advocate that it would abolish direct billing. No one has talked about abolishing direct billing for pensioners and other welfare beneficiaries. We all know that about 70 per cent of direct billing in Australia comes from that sector. If one were to abolish direct billing in the other areas one would be talking about very marginal savings. Not even the Opposition is saying that it would abolish direct billing for pensioners and other welfare recipients. It is nonsense to stand up in this place, as did the honourable member for Petrie, and claim that the Opposition would achieve all these savings in this way. Honourable members opposite talk about waiting lists. I think this is one of the more despicable claims that they make because, by inference, they are intending to put to this House that in some way Medicare is responsible for public hospital waiting lists. We really have to return to the fact that Medicare is a health insurance system, not a health service delivery system. Let us look at some of the reasons for the delays in public hospitals in Australia. There is a shortage of nurses which some of the State governments are addressing very aggressively. I commend the Victorian Government for its attempts to build up very quickly the number of nurses and their career structure in that State. We are looking also at the issue within our community of new technology, new equipment and new methods of delivering health services. When people are ill or when they are facing major operations they want the best that the health world can provide. It is extremely costly. The technology, the provision of the services and the training of the people are costly. No one resiles from that fact. The Minister for Health (Dr Blewett) is anxious to see the most efficient and the highest standard of health care service that the nation can deliver. No one on this side of the House pretends to purport that that has anything at all to do with the health insurance system which involves the Medicare levy which we are debating. Earlier the honourable member for Gippsland (Mr McGauran) started to talk about bush nursing hospitals. He talked about the two bush nursing hospitals in his electorate and how he was the resident expert on them. I have four bush nursing hospitals in my electorate, and I am just as familiar as he is with the problems faced by bush nursing hospitals. If he does his sums he will find that I, along with a number of my colleagues who are on the country task force that has been set up by the Prime Minister (Mr Hawke), represent more country people than the Opposition does. On that basis we are closer to and more in touch with some of these issues than the honourable member purports to be. In his contribution in this House-- Mr Tim Fischer —Who pays for the task force? Mr O'KEEFE —The honourable member asks me who pays for the task force. He should listen to this. In the contribution of the honourable member for Gippsland in this House tonight he said nothing at all about the attempts by the private health insurance schemes in the last few months to have these bush nursing hospitals reclassified as public hospitals or community hospitals. He made no mention at all about the fact that the first thing the directors of the bush nursing hospitals association, which is loaded with directors of the private health insurance companies, are saying is: `Get out of this. You are costing us too much. You are eating into our reserves. Get off on to the public system so that it can pay'. He did not mention that at all. We will address the issue of bush nursing hospitals, and we will do it fairly, appropriately and in a way that everybody will know is in the interests of ordinary people, not the private health sector, not private doctors and especially not private health schemes. I have no problem in standing in this House tonight and defending the Government's Budget provisions as to the Medicare levy. I see the Medicare system as being one of the most successful achievements of the Hawke Labor Government. It is a system that, as I mentioned earlier tonight, has stood its place with very few changes, not like that of the previous Government that went through models 1, 2, 3 and 4 and then did not know where it was. We have introduced a system which, as the honourable member for Petrie was kind enough to admit, is simple. As I said in my opening remarks, it is not only simple; it is cheaper, it is fairer and, most importantly, it works. Mr SLIPPER(Fisher)(9.09) —Mr Deputy Speaker- Mr Hodgman —This will be a great speech. Mr SLIPPER —I thank the honourable member for Denison. On 1 November this year, the people of Queensland will have the choice of returning the National Party Government or voting for the Australian Labor Party. The people of that State will have to consider the record of the ALP in Queensland and the record of the Hawke Labor Government. Mr DEPUTY SPEAKER(Mr Leo McLeay) —I hope that the honourable member will address himself to the Medicare Levy Bill rather than the Queensland election. Mr SLIPPER —I certainly will, Mr Deputy Speaker, for Medicare is one of the matters that the people of Queensland will take into consideration when deciding how to cast their votes on 1 November. The Prime Minister (Mr Hawke), in his 1984 policy speech, said: And I now give this undertaking-that for the term of our next government, the Medicare levy will not be increased. What has happened? The Medicare Levy Bill has been brought before the House of Representatives to increase the Medicare levy from one per cent to 1.25 per cent. Mr Hodges —He cannot tell the truth. Mr SLIPPER —The Prime Minister cannot tell the truth. Mr DEPUTY SPEAKER —Order! The honourable member knows that he cannot make those sorts of imputations and the honourable member will withdraw. Mr SLIPPER —The Prime Minister has told an untruth. It is the Prime Minister who should withdraw his statement in the 1984 policy speech, because he told an untruth. Mr DEPUTY SPEAKER —Order! The honourable member knows that he cannot make those sorts of imputations. It does not assist the House if we pursue this. The honourable member might withdraw and get on with his speech. Mr Donald Cameron —I raise a point of order. Mr DEPUTY SPEAKER —Order! The honourable member for Moreton will resume his seat until we finish with this matter. Mr SLIPPER —The Prime Minister said in 1984 that there would not be an increase in the Medicare levy. He has increased the Medicare levy; he has told an untruth. How can I withdraw? Mr DEPUTY SPEAKER —Order! The honourable member knows that he cannot make those sorts of imputations. The honourable member will withdraw. Mr SLIPPER —The Prime Minister should know that he should not mislead the Australian public. There is a State election on 1 November. The Prime Minister has been telling lies. Mr DEPUTY SPEAKER —Order! The honourable member for Fisher is pushing this about as far as it should go. The honourable member should be aware of the forms of the House. One of the things we have gone through here recently is that people shall not impute motives to people by using terms such as `liar' or saying that an honourable member has not told the truth. It would assist everyone if the honourable member withdrew and got on with making any other allusions he wishes to. He should not use those sorts of emotive terms. Mr SLIPPER —In deference to you, Mr Deputy Speaker, I will withdraw. Mr DEPUTY SPEAKER —Order! You cannot do it that way. You will withdraw and that is it. Mr SLIPPER —The Prime Minister has said that he would not increase the Medicare levy. He has increased the Medicare levy. How can I withdraw what the Prime Minister has done? Mr DEPUTY SPEAKER —Order! The honourable member might withdraw, without deference to me. Just withdraw and we can get on. Mr SLIPPER —For the sake of the debate, Mr Deputy Speaker, and to make you happy, I will withdraw. The people of Australia will have to determine whether the Prime Minister can be believed. Mr DEPUTY SPEAKER —Order! The honourable knows that he has to withdraw in an unqualified way, so will the honourable member withdraw unqualifiedly. Mr SLIPPER —I do. Mr DEPUTY SPEAKER —The honourable member may continue. Mr Donald Cameron —I wish to raise a point of order. The honourable member for Fisher, at the beginning of his speech, said that the people of Queensland have two alternatives-a Labor Party Government or a National Party Government. There are two other alternatives-a Liberal-National coalition or a Liberal dominated State Government. Mr DEPUTY SPEAKER —Order! There is no point of order. Mr SLIPPER —Every commentator believes that there is no real chance of the Liberal Party being involved to any substantial degree in the Queensland electoral situation after 1 November. The DEPUTY SPEAKER —Order! It may be better if the honourable member for Fisher addresses himself to the Medicare Levy Bill, rather than to supposition. Mr SLIPPER —I was addressing myself to the point of order taken frivolously by my colleague and good friend the honourable member for Moreton (Mr Donald Cameron). We are considering the Prime Minister's statement prior to the 1984 election, when he said: . . . I now give this undertaking-that for the term of our next government, the Medicare levy will not be increased. The Medicare levy is being increased and the people of Australia, including the people of Queensland, have every opportunity to decide whether the Prime Minister's word is being kept. The Prime Minister said that the Medicare levy would not be increased. The Medicare levy is being increased. I leave it to the people to determine whether the Prime Minister can be trusted. What duplicity and deception. We have yet another broken promise from the Prime Minister. It is absolute proof beyond doubt that the Prime Minister is not trustworthy and that the Hawke Labor Government simply cannot tell the truth. We have to add the Prime Minister's statement prior to the 1984 election to his pre-election pledge in 1983 when he said-- Mr Cobb —What did he say then? Mr SLIPPER —I thank the honourable member for Parkes. He said: . . . let me make one point so that even our opponents can understand it; and let me make it beyond all their powers of misrepresentation and distortion. There will be no new capital gains tax. What do we see in Australia? We see a new capital gains tax. Promise after promise has been broken by the Hawke Labor Government. It is a sad day when a government in office makes promises which are not kept. It is a tragedy and a matter which the people of Queensland will be able to redress on 1 November when they consider the shocking record of the Hawke Labor Government; the shocking record which saddles the Warburton Labor team for the election on 1 November. Mr Hodgman —Who is Warburton? Mr SLIPPER —The honourable member may well ask. The people of Queensland also are wondering. It is obvious that he certainly will not be the Premier after the next election. The purpose of the Medicare Levy Bill is to increase the levy contribution payable by individuals, families and trustees by a whopping 25 per cent, contrary to the Prime Minister's promise prior to the last election. The new levy rate for the fiscal year 1986-87 will be 1.145 per cent, which is the original one per cent plus seven-twelfths of the 25 per cent increase, with the increase being effective from 1 December 1986 through to June 1987. The Bill also sets the levy at 1.25 per cent for the financial year beginning 1 July 1987. The increase in the levy will raise the levy revenue for the Hawke Labor Government from $1,280m in 1985-86 to $1,645m in 1986-87. That is an increase of a massive $365m. I might add that until this Bill was introduced the cost of Medicare had been about three times the amount raised through the Medicare levy. Socialised medicine is obviously no good for Queensland and obviously no good for Australia. That will be one of the matters which will ensure that the people of Queensland re-elect a National Party Government on 1 November. It is interesting to note also that the Prime Minister and the Government have broken their trilogy promise with respect to increasing taxation. The additional money that will be derived from the Medicare levy will be part of the tax windfall for the Labor Government. In fact, Labor will raise $1.4 billion more this year. That breaking of the trilogy promise will certainly condemn it in the eyes of the people of Australia. What do we see being introduced in this Parliament? Is there a Bill which says that people will have the right to opt in or out of Medicare? Does the Labor Party say there will be free choice? Of course not, because it is a socialist Government and, consequently, it will be rejected by the people of Queensland on 1 November. Are people permitted a democratic right to take out gap insurance, so that when they go to the doctor they can receive the difference between the common fee and what they are paid by Medicare? Of course not. Many Australians have been penalised by the fact that they have had to pay the gap out of their own pockets, without any right whatsoever to insure. This has placed many demands and impositions on families. It makes a joke of any suggestion by the Hawke Labor Government that it is interested in the family, the basic unit of Australian society. Queensland has been seriously disadvantaged by the Medicare arrangements since this iniquitous scheme was introduced by the Labor Party in 1984. The Queensland National Party in government had presided over free hospitals from 1957 through to the introduction by the Labor Party of its Medicare scheme. Our State has been seriously disadvantaged by the Labor Party's Medicare arrangements. Medicare funds, which are paid by the Commonwealth to the States, are intended to compensate States for the loss of fees resulting from the introduction of free hospitals, but under a National Party Government Queensland already has free hospitals, and therefore it receives a low Medicare grant. This ignores the fact that Queensland was funding its hospitals by general taxation rather than fees. Prior to Medicare, Queenslanders still paid for their hospitals, but not through a fee system. Labor took advantage of this and ensured that Queensland was disadvantaged when the Medicare system was introduced. The Budget was brought down recently and the ALP-Mr Warburton's running mates in Canberra-had the opportunity to redress the inequities it had imposed on the people of Queensland. What happened? Did it do so? Did it say: `We have done the wrong thing by the people of Queensland'? No, it did not. Queenslanders have been further victimised under the Commonwealth 1986-87 Budget health funding arrangements. The Federal Budget Papers show that Queenslanders will receive only $81.09 per head in Commonwealth health funding this financial year compared with an average of $219.98 in the other five States. Mr McGauran —That is discriminatory. Mr SLIPPER —It is discriminatory and disgraceful. I repeat that Queensland is receiving $81.09 in Commonwealth health funding per person whereas other States are getting $219.87 per person. Is that fairness? It is not. Mr McGauran —The other States have socialist governments. Mr SLIPPER —Yes, they have socialist governments, and those governments will be rejected when they next face the people. Queensland's position has worsened considerably since the last financial year, when it was receiving $73 per head compared with an average of $173 per head in the other States. I repeat that we are now getting $81.09 per head compared with $219.87 in the other States. Previously we were getting $73 per head against $173 per head in the other States. We were being prejudiced before but now the prejudice is infinitely greater. Health funding arrangements are a public scandal and on 1 November the people of Queensland will reject Labor when they return their National Party Government. This public scandal is entirely unjustified and completely unacceptable to the people of Queensland. The health funding figures make a complete mockery of the Canberra catch-cry of restraint with equity. What a sick joke. There is no equity in an arrangement whereby my State of Queensland gets almost $140 per head of population less for a service than the other States. Mr McGauran —Less? Mr SLIPPER —Yes, less. It is a disgrace. As I have said, it is a national scandal, and it is one of the matters that will ensure that the Warburton ALP team in Queensland is rejected at the election on 1 November. In effect, it means that Queenslanders will be more heavily subsidising the free health care that is supplied in the socialist States. The 25 per cent increase in the Medicare levy in Queensland will virtually disappear to southern States to help prop up their hospital systems. To make matters worse, the cost of scrapping the subsidies for private hospitals will push up the cost of private care and force increasing numbers of people into the public sector. It is a tragedy that the State of Queensland and the people of Queensland are being slowly bled dry by decreasing funding from Canberra. We are now expected also to shoulder the extra burden that is caused by the Federal Government's abandonment of commitments. It is about time that this Hawke Federal Government, this Hawke Labor Government, admitted that Medicare is sending us all broke. It is about time also that this Government had the intestinal fortitude to take the tough decision to scrap it. Queensland is being robbed. It is being cheated and deprived of its fair share of Medicare funds. The people of Queensland will consider this when deciding to dump the ALP team on 1 November at the State election. Mr McGauran —It will become a cricket team. Mr SLIPPER —It will be reduced to less than a cricket team. I seek the leave of the House to incorporate into Hansard a table that sets out Commonwealth health payments to the States. These are Federal Budget figures for 1986-87. Leave granted. The document read as follows: COMMONWEALTH HEALTH PAYMENTS TO THE STATES Federal Budget Figures 1986-87 ($m) N.S.W. Vic Qld W.A. S.A. Tas Grants- Identified health... 621.3 408.8 126.0 196.1 215.5 70.0 Special... 2.1 0.4 3.2 2.5 18.0 19.4 Medicare... 418.6 269.1 79.2 93.6 118.1 35.4 Total... 1,042.0 678.3 208.4 292.2 351.6 124.8 Population (mill)... 5.50 4.14 2.57 1.42 1.37 .44 $ per head of population... 189.45 163.84 81.09 205.77 256.64 283.64 Average payment for States except Queensland $219.87 per head. Mr SLIPPER —The Medicare Levy Bill will leave people with less discretionary income and will lead to further pressure being put on them to give up private health insurance. It does nothing for choice. It does not give people the right to insure to meet the gap between what they have to pay and what they get back from Medicare. It is yet another sign of the moral bankruptcy of the Hawke Labor Government and another nail in the coffin of the Queensland ALP. It is another reason for Queenslanders to reject the State ALP, the running mates of the Hawke Labor Government. It is another reason for them enthusiastically to back the return of the Queensland National Party Government on 1 November. Mr ROCHER(Curtin)(9.26) —It is only three years since the Minister for Health (Dr Blewett) predicted in a speech delivered in September 1983 on the imminent introduction of Medicare that his new scheme would remain more or less intact until the end of the century. That was said three years ago and the end of the century is still a considerable time off. Medicare was proclaimed by this Government-this claim has been repeated again tonight ad nauseam by Government back benchers-as the simplest, fairest and cheapest health care system in history. Mr Carlton —What a laugh. Mr ROCHER —Yes, it is a laugh. Despite that claim-no one can deny this-Medicare has proven to be complicated and unfair and, for the majority of Australians, exceedingly expensive. The pledge of the Prime Minister (Mr Hawke) that nine out of ten Australians will pay less for the health needs of themselves and their families is now in tatters. Mr Slipper —What a joke. Mr ROCHER —Yes, what a joke. It is a key element in this Labor Government's compulsory national health insurance scheme that the Medicare levy is designed to fund the provision of medical care only partially. It will be recalled by all honourable members that the Medicare levy was introduced on 1 February 1984 at an annual rate of one per cent of taxable income. All the pamphlets that were issued as a consequence of that assured us that that was all that the rate would be. In addition, we were told that it would pay for the additional cost of this abortion of a scheme. The one per cent levy applies for the time being to all residents and it is subject to certain exemptions for incomes above specifically defined thresholds. The Treasurer (Mr Keating) in his Budget statement announced that the Medicare levy would be increased by 0.25 of one per cent to 1.25 per cent in total of relevant taxable income as from 1 December 1986. It was the final blow to follow all the insincerities that we heard from the Prime Minister and the Minister for Health at the outset and since the introduction of Medicare. As the Budget Papers made clear, on page 285, for the purpose of the assessment of provisional taxation: The Medicare levy will be a weighted average of the present rate of 1% (5/12 weight) and the rate to apply from 1 December 1986 (7/12 weight). The Bill establishes the levy for this year, 1986-87, as 1.145 per cent, and until Parliament otherwise provides, the levy will be 1.25 per cent in 1987-88. Given the treachery of this measure, no one can have any faith in relation to retaining the 1.25 per cent figure in 1987-88. Before an election-although it is unlikely that we would have to suffer another period under this Government-no one could be reassured by any suggestion that the levy will be limited to 1.25 per cent under this Government. The estimated increase in revenue as a result of this measure is $175m for 1986-87 and $325m in a full year. On page 295 of the Budget Statements we find that the Medicare revenue estimate for 1986-87 is $1,645m. That figure comprises $1.375 billion from pay as you earn taxpayers and $270m from other individuals. This represents 2.3 per cent of total receipts and is a massive 23.2 per cent increase on 1985-86. It must be recalled, and it should be emphasised time and again, as it has been already by my colleagues on this side including the shadow Minister, the honourable member for Barker, (Mr Porter), that the Prime Minister said in his 1984 election policy speech: And now I give this undertaking-that for the term of our next government the Medicare levy will not be increased. In light of that deception and on top of a myriad of other prime ministerial deceptions, one would think that not much else needed to be said. However, the Prime Minister compounded that episode in February of 1986, when he said: I affirm that the Government has no plans to change the Medicare arrangement. He has started to play with words. The following month the Minister for Health became involved in the subterfuge when he said on an Australian Broadcasting Corporation radio program: Well the Prime Minister has made it quite clear at the election and in a recent statement that there is no consideration of changing the Medicare levy. The Minister for Health chose his words less carefully than did the Prime Minister. I do not believe there is a soul in this country who would say that the Minister was serious when he said that no consideration had been given to changing the levy. That is simply not believable. There is no doubt in anyone's mind that this Government has considered changing the levy since it first introduced this scheme, and the Minister, by using those words, showed himself to be less than careful and certainly not in the same league as the Prime Minister when it comes to practising deception. This Bill increases the rate of the Medicare levy from one per cent to 1.25 per cent and adjusts the threshold limit below which the levy is not payable. It is a Budget measure and as such will not be opposed by the Opposition parties. Nonetheless, some further comments do need to be made about the Government's compulsory health insurance scheme. Medicare, introduced in 1984, provided 85 per cent coverage of the scheduled fee for medical services and `free'-that is to say, taxpayer funded-public hospital accommodation. In 1984-85 the cost to the public purse of medical benefits totalled $2,240m while expenditure on public hospitals totalled something like $924.5m-a total of $3,164m. In that year the Medicare levy raised $1,150m. In 1985-86 expenditure totalled $3,634.6m. Of that, $2,589.3m was expended on medical benefits and $1,063.3m was spent on public hospital charges. That is the measure of the increase in these two or three short years. Revenue from the levy was estimated in 1985-86 at around $1,335m. In 1986-87 public hospitals are to receive $1,075.4m and it is estimated that $2,866.2m will be spent on medical benefits-a total figure of around $3,939.6m. Should this Bill receive the approval of the Parliament, the levy will increase to 1.25 per cent, and that is the reason we are debating this measure tonight. As I have already explained, this will mean an effective levy rate of 1.45 per cent for this financial year. We are told that this would result in revenue rising to an estimated $1,645m-23.2 per cent higher than in 1985-86. So there we have it. That is the measure of the increase we are talking about. Federal Government spending on medical care has increased by 27 per cent over the last two years and the 1986-87 Budget Papers predict that it will have risen by 40 per cent by the end of this year. As my colleague the shadow Minister for Health noted recently, a major contributing factor to this rise is increased utilisation fostered by bulk billing. Labor has established an almost open-ended system of unlimited access to free-perhaps that should be in inverted commas-medical care; that is to say, taxpayer funded medical care. Let me dwell for a moment on one of the idiosyncrasies that arise out of these Budget measures. I have been advised that, under present tax regulations relating to Medicare, single members of the Defence Force are exempt from the levy. Married members are required to pay half the levy whether or not their spouse is working and regardless of whether there are children. For the purpose of Medicare, a spouse is considered to be a dependant of the member regardless of that spouse's income. This means that, if a member of the Force marries and the spouse continues working, the member is liable to pay half the levy and the spouse pays full levy in his or her own right if above the tax-free threshold. There is no justice in this arrangement-not that we think the present Government is concerned with justice-as the member of the Force can gain no extra benefit until there are children or until the spouse ceases work. However, the member immediately loses half the benefit provided by his or her conditions of employment. I can imagine what the unions would do in similar circumstances. The coalition parties are justified, if only by this one example, in heaping criticism on these measures. Mr John Logan, a specialist in the area of health economics, contributed a chapter to a recent book entitled Policies and Prescriptions: Current Directions in Health Policy, published in May this year by the Centre for Independent Studies. The Centre is a fine organisation. Its publications have a well deserved international reputation and its research into economic and social issues compares favourably with that carried out by the many publicly funded tertiary institutions in this country. Logan's chapter deals with the crucial issue of government intervention in health care. While not necessarily agreeing with all his remarks, I commend the chapter, and indeed the whole book, to the attention of honourable members. Logan traces the history of government involvement in the provision of health care and makes a number of valuable comments, two of which I want to emphasise. The first is that the size of the Government's monetary stake in health care, to which I referred earlier, understates the true extent of its influence. The author notes on page 55: The controls and regulations that abound as a result of government involvement alter people's incentives in certain ways and thus cause them to behave differently. Resource misallocation, inefficiency, cost increases and irrecoverable waste are generally the results. That is it in a nutshell. Medicare has proven hopelessly inefficient. The 100,000 Australians who are currently awaiting essential surgery in our massively overcrowded public hospitals bear testimony to that. What is worse, as Logan points out, controls over the behaviour of health care providers have: . . . helped to steer us in the direction of a full blown national health system complete with doctors as Government employees; poorly used hospital resources and rationing by waiting in line . . . What is necessary is a refocusing of attention onto the needs of patients and their families and incentives to cost containment that recognise simple economic and social realities. As a first step to reforming the Australian health care system the next coalition government will take three key steps: First, Australians will be free to opt out of Medicare and to avoid the levy provided they take out private insurance; second, except for those who really need it, bulk billing will be abolished; third, we will free up the health insurance market by allowing it to operate in innovative ways and offer health care consumers a variety of packages that recognise legitimate choices by individuals. Individualising the insurance program for health care brings the cost factor directly back into the market-place between the citizen and the health care provider. It increases the individual's self-interest in good health and breaks away from our current system which encourages both patient and provider to be less responsible, because neither has any direct individual concern about the cost. It encourages our plan; that is, it encourages people to believe that health care is merely a benefit without also involving complementary cost. This is so with the present system. It is particularly so at the margins where access to health services is utilised even when care is not necessary or on occasion is not required by all. It is a nonsense for the Government and its supporters to claim that the Medicare system as it now stands or as it will be after these amendments should be fairer, simpler or cheaper. It is just not the case and it will not be the case until the policies I have mentioned of the coalition parties are put into effect, and that will be almost certainly after the next election. Mr DUFFY(Holt-Minister for Communications)(9.42) —In closing, in the absence of the Minister for Health (Dr Blewett), there are a few matters that I would like to draw to the attention of the House. Some reference was made earlier to the absence of the Minister. I would like to put it on record that he had a long-standing commitment tonight to prerecord a television program on the national campaign against drug abuse, which even those opposite, no doubt, would commend. That is the reason he is not present. Listening to the previous speakers, I think it is necessary to come back to basically what the Medicare Levy Bill is about. The honourable member for Curtin (Mr Rocher) addressed those matters, but some of the other speakers certainly did not. The main features of this Bill are to increase the basic rate of levy from one per cent to 1.25 per cent from 1 December 1986-that is the 1986-87 Budget announcement-and to declare and impose a levy at 1.145 per cent, a composite rate for 1986-87, and 1.25 per cent for 1987-88. It also provides for an increase in the low income thresholds below which no levy is payable from $7,526 to $8,030 for single persons, from $12,504 to $13,370 for married couples or a sole parent, and from $1,530 to $1,660 in respect of each dependent child or student maintained by a married couple or sole parent, and it maintains the existing relief arrangements for certain persons, including veterans, war widows, Defence Force personnel, holders of a non-income tested basis of pensioners health benefit cards, health benefit cards and health care cards. The increase in the low income threshold will maintain the exemption from the levy for persons who would have received free health care on an income-tested basis prior to the introduction of Medicare. The increase of $1,660 in the allowance for a dependent child or a student will mean that a married couple or a sole parent with two dependent children will have an effective threshold for levy purposes of $16,690 in 1986-87. These thresholds will relieve from the levy persons who could reasonably be considered needy. I just wanted to point out a few of those matters because I thought the purpose of the Bill had been somewhat overlooked during the debate. Question put: That the words proposed to be omitted (Mr Porter's amendment) stand part of the question. The House divided. (The Deputy Speaker-Mr L. J. Keogh) Ayes . . . . . . . . . . . 64 Noes . . . . . . . . . . . 46 —— Majority . . . . . . . . . 18 —— Baldwin, P. J. Jenkins, H. A. Beazley, K. C. Kelly, R. J. Beddall, D. P. Kent, L. Bilney, G. N. Kerin, J. C. Blanchard, C. A. Klugman, R. E. Bowen, Lionel Langmore, J. V. Brown, Robert Lee, M. Brumby, J. M. Lindsay, E. J. Campbell, G. McHugh, J. Chynoweth, R. L. McLeay, LeoCohen, B. Maher, M. J. Cross, M. D. Martin, S. P. Cunningham, B. T. (Teller) Mayer, H. Darling, E. E. Milton, P. Dawkins, J. S. Morris, AllanDuffy, M. J. Morris, PeterDuncan, P. Mountford, J. G. Edwards, Ronald O'Keefe, N. P. Fatin, W. F. O'Neil, L. R. T. Fitzgibbon, E. J. Price, L. R. S. Free, R. V. Saunderson, J. Gayler, J. Scholes, G. G. D. Gear, G. Scott, J. L. Gorman, R. N. J. Simmons, D. W. Grace, E. L. Snow, J. H. Griffiths, A. G. Staples, P. R. Hand, G. L. Theophanous, A. C. Holding, A. C. Tickner, R. E. Hollis, C. Uren, T. Humphrey, B. C. (Teller) West, S. J. Hurford, C. J. Willis, R. Jakobsen, C. A. Young, M. J. Aldred, K. J. Hodges, J. C. Andrew, J. N. (Teller) Hodgman, W. M. Braithwaite, R. A. Hunt, R. J. D. Brown, N. A. Katter, R. C. Burr, M. A. Lloyd, B. Cadman, A. G. McArthur, F. S. Cameron, Donald McGauran, P. J. Cameron, Ewen McVeigh, D. T. Carlton, J. J. Miles, C. G. Cobb, M. R. Nehl, G. B. Coleman, W. P. Porter, J. R. Connolly, D. M. Reith, P. K. Conquest, B. J. Robinson, IanCowan, D. B. Rocher, A. C. Downer, A. J. G. Ruddock, P. M. Edwards, Harry Sinclair, I. McC. Everingham, P. A. E. Slipper, P. N. Fife, W. C. Smith, W. Fischer, Tim Spender, J. M. Fisher, Peter Sullivan, K. J. Hall, Steele Tuckey, C. W. Halverson, R. G. Watson, D. J. H. Hicks, N. J. (Teller) White, P. N. D. Question resolved in the affirmative. Original question resolved in the affirmative. Bill read a second time. Leave granted for third reading to be moved forthwith. Bill (on motion by Mr Duffy) read a third time. Bill returned from the Senate without amendment. Debate resumed from 17 September, on motion by Mr Hurford: That the Bill be now read a second time. Mr DEPUTY SPEAKER —Order! I understand that it is the wish of the House to debate the Taxation Laws Amendment Bill (No. 3) 1986 with the Bank Account Debits Tax Amendment Bill 1986. As there is no objection, the Chair will allow that course to be followed. Mr CARLTON(Mackellar)(9.56) —Once again we are debating taxation laws. It seem that we debate little else these days. That, of course, derives from the Government's demand for more and more money from taxpayers to pay for its excessive spending. The Opposition will not oppose the revenue measures in the Taxation Laws Amendment Bill (No. 3) 1986 and the Bank Account Debits Tax Amendment Bill 1986. However, as an amendment to the Taxation Laws Amendment Bill (No. 3) 1986, I move: That all words after `That' be omitted with a view to substituting the following words: `whilst not declining to give the Bill a second reading, the House condemns the Government for- (1) its failure to control Government spending to the point where it has broken its `Trilogy' commitment to hold taxation to no more than 25 per cent of gross domestic product and proceeded to tax Australians to the highest point in our history; (2) its contempt for ordinary taxpayers, illustrated by its decision to charge a $200 fee for appeals against rulings by the Commissioner of Taxation regardless of the size or complexity of the claim; (3) its incompetent handling of the withholding tax issue, where the Government changed the tax rules, caused a run on the dollar, and retreated 27 days later, and (4) its disgraceful treatment of the Defence Forces Reserves, by withdrawing the tax free status of reservists' pay thereby causing a grave rundown of reserve forces and damage to their morale and effectiveness, and now having belatedly to restore the concession'. The first item I shall deal with, which is in the second Bill, is a straight tax increase. Bank account debits tax is up from 1 December to bring in an extra $90m of revenue in a full year. This extra $90m is part of the $1,500m extra tax levied in this 1986 Budget. It is a further burden on taxpayers either directly through their bank accounts or by additional costs, charges and prices that go through the community as a result of the additional burden on business. The reason we must have, under this Government, an extra $90m drawn out of our bank accounts is that the Government is spending too much. The degree to which it is spending too much is shown up in the degree to which it has been forced to increase overall levels of taxation. In the last election campaign, the Prime Minister (Mr Hawke) promised that government spending would be held in check and that, as a result, taxation on the Australian people would be kept within a limit of 25 per cent of the gross domestic product. In this Budget, for the second year running, that trilogy commitment has been broken. It has already been exceeded by $1,400m in extra tax. Part of that has come from a three-month delay in the cuts in personal income tax, costing taxpayers on average $110 each. In other words, because of the delay in the tax cuts for three months, the average taxpayer will pay to the Government an extra $110 over the next three months. In addition to that, there have been increases in sales tax, which we debated in the last sitting week, and increases in the petrol excise which are a very severe burden particularly on lower income families. The House may wish to be reminded that, since the Hawke Government came to office, the petrol excise has risen from 6.2c a litre to 20.2 cents a litre. It has risen by a total of 14c a litre. That represents $6.30 a week for the average motorist. For a low income family with a car and living in the outer suburbs, that represents an extra $6.30 a week in petrol tax since the Hawke Government came to office. Of course, the Government says that individual taxpayers will be assisted by the tax cuts that they will get, though belatedly, on 1 December. But one has to be pretty sceptical about this because, if one looks at the overall amount of income tax collected by the Hawke Government, it has risen from a 1982-83 figure under the Fraser Government of $23 billion to $38 billion in the 1986-87 Budget. In other words, total taxation revenue has risen from $23 billion in the last year of the Fraser Government to $38 billion under the Hawke Government. The Hawke Government is the highest taxing government in Australia's history. It has almost doubled the total taxation take from the Australian people in its four years in office-from $23 billion in the last Fraser Budget year of 1982-83 to $38 billion in the 1986 Hawke-Keating Budget. During the period of the Hawke Government there has been an overall increase in inflation of 30.5 per cent but the increase in taxation on individuals has risen by 60 per cent, by twice the level of inflation. So inflation has risen by 30 per cent and taxation by 60 per cent. That is what is happening under this Government which has promised taxation cuts to people. In fact, the taxation cuts that people are to get will not reduce the amount of tax paid by average taxpayers, but will increase it. At the time that the Hawke Government was elected in 1983, the average rate of tax paid by a single person was 22.9c in the dollar. After all of these so-called cuts have been given, that average rate will have risen from 22.9c to 24.5c in the dollar. Even after all of these changes and after the cuts promised for next year-which we probably will not get because we are threatened with a mini-Budget to take them away-a single taxpayer will still pay a higher average rate of tax. A family will be even worse off. In March 1983 when the Hawke Government came to office a family taxpayer on average weekly earnings would have paid 17.5 per cent of income tax. That figure will rise to 20.5 per cent after the so-called Keating tax reforms. What we are seeing is a desperation for taxpayers' money. That is why the Government desperately hangs on to its absurd, lousy fringe benefits tax. The Government is desperate for revenue to cover its excessive spending. Under the Government's changes, two million taxpayers will move from a 29 per cent top tax rate to a 40 per cent top tax rate. It sounds good when one says that the top marginal rate under the so-called tax reform will be reduced from 46c in the dollar to 40c in the dollar and that the 30c rate will be reduced to 29c; but, when one realises that over the course of the two years because of inflation two million taxpayers will move from a 29 per cent top tax rate to a 40 per cent tax rate, one realises that the whole thing is a massive swindle. Over the next few months we will see an attempt by this Government to tell people that they will have reductions in tax but, because of the effects of inflation and of the excessive spending of this Government, people will be much worse off after these so-called reforms are implemented. An average Australian family will still be $23.50 a week worse off after the lousy tax cuts from 1 December this year. Since the last election a one-income family on average weekly earnings of $466 and with two dependent children has suffered a real loss in disposable income of $27 a week. The weekly tax saving for the 1986-87 year for someone on average weekly earnings of $466 will be only $3.50. This means that the average family is still $23.50 worse off since the last election. So much for the great tax reforms of the present Treasurer (Mr Keating). The Prime Minister and the Treasurer have again demonstrated their total lack of concern for Australian families by failing to give them any meaningful tax relief. The reason is that they have spent too much over four years and have almost doubled the amount of tax taken from the Australian public. I wish to draw attention to another miserable little measure in these Bills. I refer to the introduction of a $200 lodgment fee if one wishes to appeal against a decision of the Commissioner of Taxation. Previously, if one wanted to appeal one paid $2. But, under these new proposals, the charge of $2 will suddenly become $200. I have received two letters from chartered accountants who handle the tax matters of small business clients. I will quote from them as a direct indication of the effect of this increase on small taxpayers. A chartered accountant from Canberra writes as follows: It appears to me that the referral fee is particularly going to disadvantage those persons in the lower income group. By this I mean that it will not be worthwhile referring the matter to the Administrative Appeals Tribunal if the value of the tax involved is less than $200. A person who is in the lower income group and paying tax at the rate of 24.42c in the dollar will be most severely disadvantaged. The disallowance which represents an amount of $200 in tax in this particular case is $819. In other words, if somebody has $819 disallowed it will not be worth their paying the fee to have it looked at again. On the other hand, a person paying tax at the highest rate, namely 57.08c in the dollar need only have a disallowance of $350 in claims to equal the $200 in tax. In other words, the higher one's income, the better off one is with his $200 fee. The people on the lowest incomes and the lowest tax rates will be the ones most disadvantaged. That is normally the case with anything done by a socialist government. It is always the people who are worse off who finish up at the end of the queue. The letter continues: The idea of referring a taxation objection or disallowance to the Board of Review, now the Administrative Appeals Tribunal, was to provide a cheap and inexpensive way for a taxpayer to have a person or persons outside the Taxation Office review their objection. Under the new arrangement involving a referral fee, it would appear that this cheap and inexpensive method has now gone and only those with substantial claims will proceed. My additional concern is that the Taxation Office may take the attitude of disallowing the smaller claim en masse with the object of having raised further revenue unjustly. This is something that cannot be checked by parliamentarians but the system now is certainly open to abuse by the Taxation Office. In other words, the tax office might take advantage of this by knocking out willy-nilly a whole lot of small claims-this is what the accountant is saying-because it will not be worth the while of those small taxpayers to pay the $200 fee to have the matter challenged. I have with me another letter from a chartered accountant in Melbourne, who goes into the matter in a different way. He says: The imposition of a fee at a level of $200 would also make referral of some matters beyond the reach of a large number of taxpayers. This fee appears to be aimed at the removal of the legal rights for a large group of the community who are `small taxpayers'. In the case of a dispute over the disallowance of a small expense item in a husband and wife partnership- here one is talking, I suppose, about small business- to pursue the matter beyond the objection level will cost each partner $200-that is, $400 in respect of one item in dispute. So if in a small business partnership of man and wife there is an objection, each partner will have to pay $200. It simply will not be worth the candle, if they have to pay $400 to have a matter looked at. What sort of a government is it that brings in things of this kind? Mr Barry Cohen —A terrific government. Mr CARLTON —The Minister says that this is a terrific government. He says that it is a terrific government which brings in a $200 objection fee which has its greatest effect on the smallest taxpayers, those who have the least money to cope with it. That is the sort of government this Minister is proud of. The next matter I shall deal with tonight-and I shall continue my remarks tomorrow because we are running out of time-relates to the interest withholding tax fiasco. This is an extraordinary story. On 1 July the Treasurer made the statement that to protect Commonwealth revenues the Government had decided to remove a number of exemptions from interest withholding tax. I shall not go into the complications, but it meant that a number of people who had widely held securities overseas, or if there were borrowings by Commonwealth and State authorities, rollovers and extensions of loans which were exempt from interest withholding tax-the tax paid before the interest is sent back overseas to the person who has made the loan-had those exemptions removed. That was to raise net revenue of $60m in 1986-87, rising to $175m in later years. This was a stupid, ill-timed decision. Following the decision, the Australian dollar dropped to a new record low. It went down to 55.2 on the trade weighted index, 66.5c against the United States dollar and 108.6 against the yen. It hit new record lows on 2 and 3 July following the 1 July announcement. Over the rest of July things went from bad to worse. Despite large and costly Reserve Bank intervention, on 28 July the Australian dollar continued to drop and it plummeted to 50.c on the trade weighted index and only 60.3 against the United States dollar, a drop of 6.2c over the course of less than a month. The Treasurer panicked and, in an attempt to stem the slide of the dollar on that fateful day, he announced the reversal of the 1 July decision to close off the interest withholding tax exemptions. It was a black day on 1 July 1986 for Australia because the overseas financial markets could not understand what the Australian Government had done. It suddenly changed a whole lot of arrangements upon which people had relied for years, the dollar plummeted and over the course of a month went down 6c against the United States dollar. The Treasurer was shamefacedly forced to reverse this decision only 28 days later. It was one of the most shameful examples of mismanagement by this Treasurer during a period of office which has been marked increasingly by mismanagement in a whole range of areas. Debate interrupted. Mr DEPUTY SPEAKER(Mr Keogh) — Order! It being 10.15 p.m., I propose the question: That the House do now adjourn. Mr HODGMAN(Denison)(10.15) —My concern about Australia's new submarines program was first expressed in this House on 13 September last year when, in a speech, I put six specific questions to the Minister for Defence (Mr Beazley). These questions produced a written response from the Minister to me dated 16 October 1985 comprising four pages of exculpatory rationale, written in Russell-Hillese. Time does not permit me to dwell on the matters in that response, except to say that I was unconvinced then-and I remain unconvinced. I now wish to address the following specific questions to the Minister and I hope that we will get the answers quickly. First, is it a fact that by the end of the project definition study in November 1986, the IKL/ HDW design will still be a `paper boat' with no proven powered discharge system and hence no noise signature figures of any validity? Secondly, is it a fact the IKL/HDW and Kockums have already expended their total allocation of funds for the project definition study and are now supposedly working off their own money-or are they? Given the Minister's previous assurance that no taxpayers' money would be expended in research and development work properly the responsibility of the tenderers, will the Minister repeat that assurance as soon as possible? Specifically, were front end redesign costs for both contenders paid for out of PDS funds? Thirdly, is it a fact that scheduled refits for the current Oberon submarines were tailored to a delivery program for the new class of submarines to commence in 1991? Will the first of the new class submarines be delivered in 1991? If not, can the Minister indicate when the original delivery date was changed and what is the new date for commissioning of the first of the new submarines? Will any substantive over-run in delivery of the first and subsequent new submarines necessitate another unscheduled refit for one or more, or indeed all the Oberons? Using current figures at $40m per boat, will a refit for all the Oberons amount to well in excess of one-quarter of a billion dollars, and does the Minister intend adding any such sum on to the cost of the new project, or will he be coming back to this Parliament seeking a new appropriation for such expenditure? Fourthly, will the Minister guarantee that the new submarines will all be built in Australia and that Mr Dibb's recommendation on page 19 of his Review of Australia's Defence Capabilities about exploring `options' for lesser capabilities will be emphatically rejected? Fifthly, will the Minister deny that already the tenderers are inquiring about the possibility of carrying out work offshore-outside Australia-and that cost escalations are up to 30 per cent above the currently agreed price, with the further alternative of one or more of the submarines being built outside Australia being sought by the tenderers? The new submarines program, which the Minister said had been endorsed by Dibb, but which Mr Dibb qualified somewhat by urging the establishment of `a financial ceiling' and the exploration of `options for the lesser capabilities', is as prickly as a porcupine. I certainly agree that six new submarines are urgently needed for Australia's defence-but from that point onwards the Minister, the Hawke socialist Government and I part company. Mr LANGMORE(Fraser)(10.19) —In preparation for the Pope's visit to Australia, the Catholic Commission for Justice and Peace and Australian Catholic Relief have published a selection of John Paul II's statements about issues relating to justice and peace. I found great value in reading these excerpts in the pamphlet `Founded on Justice and Peace' and so would like to bring them to the attention of honourable members. While the aim of the pamphlet is to promote study and reflection among members of the Catholic Church, those of us who are not Catholics will also find a great deal of relevance in its pages and I wholeheartedly commend it to members of Parliament. `Founded on Justice and Peace' brings together statements of Pope John Paul II on some of the major issues of our time. Its publication follows in the tradition of the CCJP's earlier statements `Work for a Just Peace' in 1985, `It's a Rocky Road'-on youth-in 1984, `Changing Australia' in 1983, `House and Home'-on housing-in 1982, `Partners: Australia, Asia and the Pacific' in 1981, `Poverty, Power and the Church' in 1980, `Beyond Unemployment' in 1979 and `Aborigines' in 1978. The 1986 statement shows that the somewhat controversial issues which the CCJP has written about in earlier years have a firm basis in the social teaching of Pope John Paul II. For example, on the economy he has said: In various parts of the world, in various socio-economic systems, there exists entire areas of poverty, shortage and underdevelopment. This fact is universally known. The state of inequality between individuals and between nations not only still exists; it is increasing. It still happens that side by side with those who are wealthy and living in plenty there exist those who are living in want, suffering misery and often actually dying of hunger; and their number reaches tens, even hundreds of millions. This is why moral uneasiness is destined to become even more acute. It is obvious that a fundamental defect, or rather a series of defects, indeed a defective machinery is at the root of contemporary economics and materialistic civilisation, which does not allow the human family to break free from such radically unjust situations. On the arms race and the search for peace, Pope John Paul has said: Instead of bread and cultural aid, the new States and nations awakening to independent life are being offered, sometimes in abundance, modern weapons and means of destruction placed at the service of armed conflicts and wars that are not so much a requirement for defending their sovereignty, but rather a form of chauvinism, imperialism and neocolonialism of one kind or another. We all know very well that the areas of misery and hunger on our globe could have been made fertile in a short time, if the gigantic investments for armaments at the service of war and destruction had been changed into investments for food at the service of life. The Pope's well-known respect for indigenous cultures is also highlighted in a passage from a speech to the Indians of Guatemala, when he said: Your native cultures are the wealth of peoples, effective ways for transmitting the faith, representations of your relation with God, with all men, and with the world. They therefore deserve the greatest respect, esteem, sympathy and support on the part of all mankind. This theme has been carried through in the further work of the Catholic Commission for Justice and Peace on Aboriginal land rights. Many members of parliament will have seen the CCJP's issues paper `Land Rights: A Fair Go for Aborigines', which argues persuasively for just land rights legislation and also for an educational campaign among all Australians to promote those positive steps which have already been taken in this direction in order to counteract racist campaigns against Aboriginal people. Many of Pope John Paul's statements are action oriented, reminding readers of their role in helping to build a more just society. It is appropriate to reflect on these and other prophetic statements by the Pope as Australia prepares for his visit. The Catholic Commission for Justice and Peace and Australian Catholic Relief are to be congratulated, not only on bringing these words to the attention of a wider section of-- Madam SPEAKER —Order! The honourable member's time has expired. Mr COLEMAN(Wentworth)(10.24) —I wish to use this adjournment debate to draw the House's attention to the recent death on 27 September of a very distinguished and influential Australian, Henry Richard Krygier. He was not a man for the headlines; he was, if you like, a behind the scenes organiser, or a lobbyist for his causes. He did not promote himself, but he worked ceaselessly, even relentlessly, for the preservation of a free and democratic society in Australia and in the world. Born in Warsaw in 1917, the year of the Russian Revolution, he came to this country in 1941 with his wife, Roma, from a Poland which had then been partitioned by the then allies Hitler and Stalin. He reached here via Vilna, Vladivostok, Tokyo and Shanghai, arriving shortly before Pearl Harbour. His experiences as a young man of totalitarianism-nazi and communist-forged in him a physical loathing of totalitarian dictatorship of any type and also made him sensitive to what one may call pre-totalitarian sentiments. He saw the threats to democracy vividly and worked to strengthen the free societies. Inevitably, his first years in this country involved work in Polish circles until the Polish Government offices in Australia were closed down after the Yalta Agreement which, in effect, gave eastern and central Europe to the Union of Soviet Socialist Republics. Richard Krygier then began to work in the wider Australian community, at first with his friend W. C. Wentworth, and later on his own. In the early 1950s he became the Australian representative of the Congress for Cultural Freedom, which was an international organisation formed in 1950 which attracted writers, artists, scientists and intellectuals generally to the defence of liberal and democratic values at a time when the full weight of Soviet propaganda was directed at undermining them and often seemed to be succeeding. In 1953 he formed an Australian Association for Cultural Freedom, an affiliate of the International Congress for Cultural Freedom. He persuaded the great lawyer, Sir John Latham, to be its first Chairman, and Sir John was followed in later years by Dr Lloyd Ross, Sir Zelman Cowen, Professor H. W. Arndt, and today Professor D. M. Armstrong as President. This Association has made significant contributions to the national debates on a range of issues affecting intellectual, artistic and cultural freedom in Australia, such questions as of censorship, academic freedom and multiculturalism before that word was commonly used. Richard Krygier had kept that collection of difficult men and women and difficult intellectuals together for more than 32 years and he was effective in that not only because of his commitment but also because his own modesty made him put the ideals of the Association above himself. No one could have been less of a prima donna. But this principal contribution to Australian cultural life was the establishment in 1956 of the magazine Quadrant. He built it up from a quarterly to a bimonthly to a monthly. It is not for me, as its current editor, to talk about its achievements, but I can say that without Richard Krygier's dedication to the magazine it would not have survived or prospered. There is much more to be said about this remarkable man. There is not time to discuss the international conferences he organised in Canberra, Malaysia and Papua New Guinea, all on the theme of building and strengthening democracy in the world. He became, through these activities, a man well known in many parts of the world. That is also evidenced in the readiness of people to pay tribute to him and his work on the occasion of Quadrant's 30th anniversary issue. These writers were from the United States, France, England and India, as well as Australia. They included his old friend Zbigniew Brzezinski, the former national security adviser to President Carter, and many editors and writers. Unhappily, Richard Krygier did not live to read these tributes. Australia has lost an extraordinary man and the world has lost an irrepressible champion of liberal and democratic values. Mr CHYNOWETH(Dunkley)(10.28) —I am aware that the word `discrimination' has been bandied about by all and sundry of late, and I rather suspect that when one hears it mentioned one tends to turn off. Nevertheless, as a city dweller, I must resurrect it one more time to point out to my State government and Territory colleagues how vitally important it is that they make every effort to administer the new funding arrangements for the soon to be defunct isolated patients travel and accommodation assistance scheme in a fair and equitable way by including in the funding support for those of us who live in cities and outlying metropolitan areas. I commend the former IPTAAS for all the positive achievements it made. More than 150,000 people were assisted by the scheme in 1985 and I am certain that they will agree with me that it was an excellent financial support for them at an important time. Even so, the scheme had some problems which I will outline briefly. For some time the Federal Government had been concerned that the scheme had been failing to meet the real needs of patients who had to travel long distances to obtain necessary health care. A working party was established in June 1985 on patient transport considerations. This comprised Commonwealth, State and Territory officials who studied the rationalisation of patient transport and the provision of assistance for interstate transport patients for speciality services and also reviewed the whole scheme. The outcome of the working party's decisions is that States and Territories will now be respon- sible for the administration and distribution of the funding for the people concerned. `Responsible' is also a word that I would like to reiterate in stressing the pure meaning of the word to the States and the Territories, that is, liable to be called to account, answerable to, not to be autocratic, to be morally accountable for one's actions, to be capable of rational conduct and so forth. I urge all my State colleagues to make the right and responsible decision and support all patients in need of interstate transport and specialised care. The Government has opened the way for the States and Territories to redress this past inequitable situation and make it more efficient and effective for all those in need by providing very generous grants to the States of $10.9m for the first six months of 1987, with a full year equivalent of $21.8m being indexed in future years. On a full year basis this represents an increase of more than 26 per cent over the $17.2m provided for the benefits that were distributed under the old scheme in 1985-86. This level of funding was increased because of the need for some capital city dwellers to travel interstate for highly specialised treatment. To give a better idea of the unfairness of the scheme in the past, let me cite a case in point in which I was recently involved. One of my constituents applied for assistance through the scheme for her son who required a heart-lung transplant. St Vincents Hospital in Sydney was the only available hospital in Australia where treatment for heart-lung transplants was carried out. To be eligible for assistance under the old scheme a patient had to reside in an isolated area, which was defined as residing more than 200 kilometres from the specialist. All areas other than the metropolitan areas of Sydney, Melbourne, Brisbane, Adelaide and Perth were considered isolated. However, even though Frankston was more than 800 kilometres from the specialist, it was not considered isolated. The constituent had to pay for the accommodation and air fares necessary to get her son the treatment that he so urgently needed. Understandably, she was hurt, both emotionally and financially, by the regulations. I made representations on her behalf to the Minister for Health (Dr Blewett), but they were not successful. They were not successful because the patient was classified as not living in an isolated area. I believe that it would show a total lack of conscience if the States and Territories did not follow through on the Federal Government's lead and make funding available for all Australians who need it, not just those from isolated country areas. The Labor Government prides itself on its many excellent policies which provide assistance for all Australians from all parts of our country. Madam SPEAKER —Order! The honourable member's time has expired. Mr CONNOLLY(Bradfield)(10.33) —The Australian Institute of Aboriginal Studies was established by a former coalition Government in 1964 as a statutory authority under its own specific Act of this Parliament. Section 6 of the Act sets out the functions of the Institute. They include: (a) to promote aboriginal studies; According to the Act, `aboriginal studies' means anthropological research and study in relation to the Aboriginal people of Australia, including research and study in respect of culture and languages. The further functions of the Institute, according to the Act, are: (b) to publish, or assist in the publication of, the results of aboriginal studies; (c) to encourage and assist co-operation amongst universities, museums and other institutions concerned with Aboriginal studies; and (d) to assist universities, museums and other institutions in training research workers in fields relevant to aboriginal studies. The Act goes on also to identify the function of promoting Aboriginal studies primarily by giving financial and other assistance to the carrying on of those studies under the auspices of universities, museums or other institutions, et cetera. It is a matter of great concern to me, therefore, as a member of the Council of the Institute, which is a responsibility put upon me by this Parliament, that at a meeting of the Council last Thursday a sum of $72,589 was proposed to be spent as a grant to an historian, Dr Peter Reid, to write a political biography of Charles Perkins, who is currently the Secretary to the Department of Aboriginal Affairs. As I said, this Institute was established to foster genuine research into Aboriginal history. In the Act the function of anthropological research, the study of Aboriginal people and so forth is quite explicit. Accordingly, it is difficult to see how a political biography of Charles Perkins could possibly meet the above definition. It is also improper and, in my opinion, a gross misuse of public funds and of considerably dubious merit that a political biography, paid for with public funds, should be written while Mr Perkins is still actively involved in Aboriginal politics and, equally significant, is a senior public servant. The grant not only is contrary to the stated objectives of the Institute but also is being made at a time when the Institute's funds have been reduced and a substantial number of worthy research projects cannot be supported. The proposals that were put to us last week were for a total research budget for 1986-87 of $200,000. Eighty-six applications were considered; 42 were recommended for funding; and funding was provided for a mere 19. That works out at an average of $10,526 each. Yet the Perkins book proposal, funded over two years, was to involve a total of $72,589. It may benefit the Parliament to know that applications for funds for many worthwhile programs have been received, such as the South Australian Aboriginal language survey, historical research of the Walgett area, social impact assessment in the east Kimberleys, survey of Aboriginal sites on Christmas Creek station, bibliography on Queensland Aborigines, the Fleurieu Peninsula archaeological survey, economic viability of Aboriginal grants to secondary education and cross-cultural training for Aboriginal community development. It is in that context, therefore, that I take grave exception, as I am sure will other members of this House, to the fact that, at this stage when the Institute has received a letter from the Minister for Aboriginal Affairs (Mr Holding) setting out the need to cut back real funding by 3 per cent in the next three years, it is prepared to make funds available for projects such as this. As a result of the strong disagreement of some members of the Council, including me, it was agreed to fund the author for only 12 months and to review the progress of his work thereafter. Nevertheless, I strongly object to the use of the Institute's funds for this purpose. It is highly irregular to use public funds for a biography of a public servant. If the project had merit, the author should have applied for funds from other sources, such as publishing houses, the Commonwealth Literary Fund, the Literature Board of the Australia Council or the Australian Bicentennial Authority, as the book was supposed to be published in 1988 and as it is apparently supposed to have some impact on Aboriginal attitudes towards the Bicentenary. I strongly suggest that the Secretary to the Department of Aboriginal Affairs, Mr Charles Perkins, re-examine his involvement in this proposal. His credibility is at stake, and credibility remains a matter of supreme importance in any leadership role for any community. The Aboriginal people need far more than political biographies. Madam SPEAKER —Order! The honourable member's time has expired. Mr DUNCAN(Makin)(10.38) —In the few minutes available to me tonight I wish to bring to the attention of the House and the Australian people a quite extraordinary commercial swindle which I have had brought to my attention by a resident of South Australia. This involves a finance organisation which lends money on mortgage. I am about to talk about not any fly-by-night finance company but the Commonwealth Bank of Australia. Opposition members interjecting- Mr DUNCAN —If honourable members will wait a moment, they will see just what is involved in this. Honourable members will be amazed to find the details of this as they unfold in the next few minutes. My informant in South Australia, Mr Rollings, took out a mortgage with the Commonwealth Bank in September 1963. The mortgage quite clearly stated that the bank may, at the expiration of each 10 years during the currency of the loan, vary the rate of interest on the loan provided at the rate then charged, et cetera. In other words, for those to whom it may not be clear, this provides for 10-year rests; the interest rate could not be varied except at 10-year intervals. Quite properly, in 1973 the bank wrote and varied the interest rate from $32 per month to $36 per month-- Mr McGauran —Ha, ha! Mr DUNCAN —Such were the interest rates of those days. On 1 September 1983 it increased the rate from 6.25 per cent to 12 per cent. So far so good; everything was in accordance with the requirements of the mortgage. Then, in August 1985 a circular letter was sent to this mortgagor, Mr Rollings, indicating that a loan service fee was to be applied. I do not need to go into whether or not that was proper and correct in law under the mortgage, because soon after a letter was sent to the mortgagor indicating that the Bank was no longer going to proceed with the loan service fee. In those circumstances the bank wrote to the mortgagor: Please accept our sincere apologies for any concern we may have caused you on receipt of the earlier notification. I must say that I was very pleased to see the Commonwealth Bank doing that, as I was one of those who complained bitterly about the ruse involved in applying a service fee instead of increasing mortgage rates, where that was possible. Mr Downer —It was a trick. Mr DUNCAN —We will hear about tricks in a moment. On 10 April 1986 the Commonwealth Bank wrote to Mr Rollings indicating that it was going to increase his interest rate from 12 per cent to 12.5 per cent. It simply indicated in that letter, which I do not have time to read in full: Accordingly, the interest rate on your loan has been increased to 12.50% pa effective from the due date of the April 1986 repayment. The mortgage in this case does not provide for that; it does not allow for such increases except in the 10-year rests provided for in the mortgage. I want to know from the Commonwealth Bank how many thousands of other notices of this sort were sent out to people who may not have been as street smart as Mr Rollings. Mr Rollings is a person who keeps all of the documents provided under his mortgage and was therefore able to check back to see that he was being taken for a ride and an attempted swindle was going on. There may well be many thousands of others throughout the nation who have received these letters and have simply paid up, believing that the Bank had the right under the mortgage arrangements to claim these sorts of payments. Mr Rollings suggested to me that Ned Kelly was hanged for less than that. I think he was entirely right and the Commonwealth Bank owes the people of Australia an explanation. A response is needed from the Commonwealth Bank as to how many thousands of other people-so-called clients-throughout the nation were sent this sort of letter of demand with no basis in law for the sending of the letters. Mr MILES(Braddon)(10.43) —Over the last weekend in Tasmania the normal situation which arises in spring time has arisen again. The debate about the environment has come up again, as the Australian Heritage Commission has come out with a report saying that logging should not occur in one of the areas close to a national park area. One gets a little bit cynical about this, after a few years of noticing that the conservation movement in Tasmania always has something to hang its arguments on at this time of the year in preparation for organising students and people during the summer months. It never seems to happen at any other time of the year. It is very interesting to note that the complaint is about a pristine view from the national park, with the conservation movement complaining that it does not want to see any logging going on in a State forest area which is alongside the national park, yet it is at least six or seven kilometres away from the edge of the national park. The complaint is that it will spoil the view from the national park, even though the area which will be logged is in a State forest area. The situation is that there has to be a limit to what we will allow the conservation movement to do in regard to locking up resources in our nation. When we have the Heritage Commission saying that it would be a severe fire risk, I question whether the Heritage Commission has the same skills as the Tasmanian Forestry Commission to make that sort of judgment. Mr McGauran —It definitely does not. Mr MILES —I agree with the honourable member that it definitely does not have the ability to make that judgment. I think it ought to restrict its comments to those which it is qualified to make and should not make those types of allegations. In 1983 a management plan was approved by the Government for the Lemon Thyme Valley. It has been accepted by the Federal Government. The spokesman for the Tasmanian conservation movement, Mr Geoff Law, says that it is now up the the Federal Government to honour its promise and stop the logging operations. I do not believe that that is what the Federal Government's commitment was. The commitment by the Federal Government was that it would have a look at any operations that would adversely affect National Estate values and would then use its powers accordingly if it felt that the values were being affected. In this case I would like to encourage the Government to have a good look at what the conservation movement is asking it to do. Mr Slipper —The Minister is here. Mr MILES —I notice that the Minister for Arts, Heritage and Environment (Mr Cohen) is here. It is important that we take a rational and sensible view of this issue, because it is a land use issue and land use issues should remain at the State level. I know that a lot of toing and froing goes on over these types of issues and it is about time that the States know just who controls land use in each State. I believe that, if the Federal Government gave a clear lead on this issue and told the conservation movement that it is going beyond its bounds in pushing for this issue, that would resolve this problem which is certainly noticeable in Tasmania. I know that it is a matter which could inflame the States rights issue, but I appeal to the Government to look at it in a rational way and not to be hoodwinked by the conservation movement on this issue. Mr O'KEEFE(Burke)(10.47) —I rise to comment upon the success to date, as observed in my electorate, of the Buy Australian campaign and to report to the House some of the responses I have been getting from shoppers in the shopping centres around my electorate. It is quite clear that people are picking up the message that Australian manufactured goods which are well designed and well marketed can compete both at home and overseas. I am pleased to see that this message is coming through to people as they are making their buying decisions. It is clear that, providing our shoppers go into shopping centres with a commitment to buy Australian, to ask for Australian made goods and to demand high quality Australian made goods, our manufacturers and producers will respond. The obligation lies upon manufacturers, retailers and producers to provide high quality goods at a competitive price and to improve upon their marketing, labelling and service. If we put all that together as a recipe, it is clear that we can mix together the blend of fewer imports, more exports and stable prices. I make the point that prices in Australia have been rising faster than wages; something which those who set the prices in Australia have to face up to. If we put those factors together, we have a recipe for success. Our economy is as finely tuned as a Finnerty guitar. I know something about those guitars. They are an excellent style and make and have to be finely tuned. An economy which has to be finely tuned depends upon the people to respond to these sorts of directions as they are laid out in the buy Australian campaign. I report to you, Madam Speaker, that people in towns such as Castlemaine, Daylesford, Ballan, Heathcote, Maldon and Kyneton, all across my electorate, are responding to the campaign. They want to support the Government's call for people to prefer to buy Australian made products. The campaign is working. I noted with some humour that in July the Melbourne Sun led with a front page headline about dollar doom. That was when the dollar reached 66c against the American dollar. Yesterday the Melbourne Herald, which is part of the same stable, carried the headline `Dollar healthy at 63.7c'. It has taken those economic pundits a little longer than some to learn that the devaluation of the Australian dollar is not a message of doom for our economy but the recipe by which our manufacturers are suddenly realising that they are back in the market-place again. They are realising that they can compete, that imports are now too dear and that consumers are ready to show the preference for Australian made products for which we are all looking. This will result in the turn-around in the economy that we all want to see. I commend the Treasurer (Mr Keating) and the Government for having stuck to their guns and adhered to their policy. It is clear in my electorate that the people both understand it and are supporting it. If I were a manufacturer of Australian made products, I would be concentrating on the right price, high quality and good service. I know that that would be a recipe for success. Mr HICKS(Riverina-Darling)(10.52) —Recently I attended the opening of extensions to the Burke Ward Primary School at Broken Hill. The school's colours are red and black and the motto is `Strive with Honour'. The school has been in existence for nearly a century and there would be few schools that have a tradition such as that of the Burke Ward school. I speak from experience because my grandparents attended the school, as did my parents. My wife was captain of the school at one stage and my children attended the school. I am very proud of the school. The extensions were opened by Rod Cavalier, the Minister for Education of New South Wales. Although he is not of the same political persuasion as myself, I have a great deal of respect for him. In the past he has taken a great deal of care and notice of the people in western New South Wales-in the bush, as we call it-who have particular problems. He has made sure that the schools in that area are staffed by good teachers. He has ensured also that the smaller bush schools that may have closed have not closed. These schools have attended to the education of the children in the area and, in common with most bush schools, they remain the centre of the community in the areas of which I am speaking. The Burke Ward school is noted for its discipline, the standard of education and the way in which the children who attend it behave. It is noted for its style of teaching. It has a fife band, which has been in existence since the school opened. The people of Broken Hill are proud of the band, which wins many awards both in New South Wales and in South Australia. In the past fortnight the Central School has celebrated its centenary. It has shifted location in the past few years, but it marks a century of education in Broken Hill. That is important because, as was stated at the opening of the extensions at the Burke Ward school and at the centenary celebrations of the Central School, Broken Hill has many teachers who uphold the traditions of teaching in New South Wales. When younger teachers come to the area, they teach them the ropes. Teachers colleges are more or less kindergartens for future teachers, and when young teachers come to Broken Hill there are great educators who remove the rough edges from them and provide a real education for those who are to teach in Broken Hill. I suppose that my speech is designed to pay tribute to the Burke Ward primary school and the Central School in Broken Hill as well as the high schools-Broken Hill High and Willyama High-and the other primary schools to which I have not yet referred, the North Primary School, the Railway Town Primary School, and the Alma Primary School. There are many schools in Broken Hill, including private schools, and they all provide an education for the young children of the area, something which is especially important for those in isolated areas. I pay tribute to those schools and to their educators who have done so much for Broken Hill, for the State of New South Wales and for the people of Australia in educating those young people who went on to become giants in the mining industry, in areas of science and in just about every following that can be undertaken in Australia. I am sure all honourable members would join me in paying tribute to the educators of Broken Hill. Mr TICKNER(Hughes)(10.55) —Tonight I draw the attention of the House to what I consider to be a potential very serious threat to public health. That threat is posed by a substance commonly referred to as smokeless tobacco. I first had my concerns alerted to this substance by an organisation called ASH Australia, which is Action on Smoking and Health. This organisation was formed by the National Heart Foundation of Australia and a number of other leading Australian authorities on public health which are joining together to campaign against the use of tobacco in society and to alert Australians to the fact that some 16,000 of our number die each year as a result of diseases directly attributable to the use of tobacco. However, a new product is coming on the market in Australia which has only comparatively recently become available. Smokeless tobacco has sometimes been referred to as snuff and sometimes as chewing tobacco but whatever form it comes in it is, according to all the available evidence, as dangerous to public health as is smoking cigarettes in the most commonly used form. The smokeless tobacco that I have seen is promoted in Australia by W.D. and H.O. Wills (Australia) Ltd. It is commonly referred to by the product name of Skoal Bandits and is in the form of a little tea bag of tobacco which is placed between the lip and the gum. The tobacco is leached from the tea bag substance into the blood stream. Prolonged usage can cause cancer. I emphasise that I am not attempting to bash tobacco users. I know there are members in the chamber tonight who fall into that category. But whether or not we are users of tobacco we would all agree that if we can discourage young kids from using this substance and minimise its use in society it will be a better society. The information I have is that the importation of smokeless tobacco has increased three-fold in the last three years and that there is a decided push to increase the sale of this product in coming years. A prominent representative of the American tobacco companies is in Australia at the moment to promote the use of this substance. It is not just my opinion that the use of this tobacco constitutes a serious risk to public health. The leading British medical magazine-the Lancet-has also chronicled the record of this substance, as has the World Health Organisation and the New England Journal of Medicine from the United States of America. The marketing practices of tobacco companies in the United States used every trick in the book, including utilising sporting heroes and country and western singers, in order to promote the product. The National Health and Medical Research Council has, to the best of my knowledge, put forward a proposal that the product be placed on the list of prohibited imports into Australia. I understand there has been some communication with the Department of Industry, Technology and Commerce but as yet the Government has not made a final decision on this matter. I stress that I am not a wowser, but I sincerely believe that if the Government acts on this problem now we can avoid a major public health problem which could cause a tremendous amount of cost to our country and to young Australians. Madam SPEAKER —Order! It being 11 p.m., the debate is interrupted. Mr Cohen —Madam Speaker, I require the debate to be extended. Madam SPEAKER —The debate may be continued until 11.10 p.m. Mr COHEN(Robertson-Minister for Arts, Heritage and Environment)(11.00) —Earlier the honourable member for Braddon (Mr Miles) mentioned the Lemon Thyme Forest, which I presume is in his electorate. Mr Miles —No, it is in the Lyons electorate. Mr COHEN —It is in a region in which he is interested. He made some reference to comments of the Australian Heritage Commission that there should be no logging in the Lemon Thyme Forest because the area could be viewed from the Cradle Mountain National Park, which is part of a World Heritage area, and logging would spoil the pristine view from that important and internationally famous park. I would like to deal with a number of issues raised by the honourable member for Braddon. I refer first of all to the Australian Heritage Commission. That body is my responsibility. I think he said that he was referring to the comments of the Heritage Commission as if it were the conservation movement. Mr Miles —No, I was not saying that. Mr COHEN —I misunderstood what the honourable member said. Of course, the Heritage Commission is not part of the conservation movement; it is a government organisation and its responsibilities are to compile the National Estate Register and to monitor what goes on in that regard. Of course, it also advises the Government on actions it should take. The matter raised by the honourable member has been of considerable concern to me and has been a part of a heritage review which we have just about completed. I refer to the misunderstanding that has occurred in the minds of many people about what listing on the National Estate register means. There is a misunderstanding on the part of loggers, developers and people in State and local government that listing on the register means that nothing can happen in an area, that it is a no-go area that must remain untouched, whether it be a built environment or a natural environment. That misunderstanding often arises as a result of ignorance. The conservation movement has been guilty-I am not sure whether through ignorance or deliberately-of creating the impression that listing on the National Estate Register means that an area cannot be touched. The honourable member quite rightly said that the Federal Government had said in its agreement with the Tasmanian Government that it would strive to protect National Estate values. It did not mean and has never meant by that that no action could take place in a National Estate area. If that were the case, nothing would ever happen in any of the 7,000 areas listed on the National Estate Register. That is not the case. The Commonwealth Government requires that when some action is proposed concerning a particular site or area on the Register the Minister must take note of that action and ensure that if possible its National Estate values are protected. It should try to avoid any action which would in any way despoil the area. As very often happens in the case of a building, for example, the Minister, in this case me, and the Government might well consider that and make a decision that it should proceed, despite the fact that it might damage the area's Estate values. We will try not to do that but in some cases it is unavoidable. Madam SPEAKER —Order! The Minister's time has expired. As no other Minister has risen to speak, the Minister may continue until 11.10 p.m. Mr COHEN —The Government is in the process of setting up a committee which will work with the Tasmanian Government to ensure that, in the woodchip agreements which we are working out with that Government, the National Estate values of those areas, if humanly possible, will be fully protected. The honourable member raised the case of whether there should be logging in the State forest because it can be seen from the World Heritage area of the Cradle Mountain National Park. I have some sympathy with that view but I also understand the view that the honourable member put forward that there is a limit to how many buffers one can have. We have a national park and then a buffer for the national park and then a buffer for the buffer. It goes on forever. Concerning the Lemon Thyme, the conservation movement has been concerned that logging there could be viewed from the World Heritage area and would despoil its pristine values. To the best of my knowledge-I was not able to get details on this matter at such short notice-that matter will be looked at by the committee. That committee is balanced. People on that committee will represent the forestry and logging interests of Tasmania-employers and employees-and will also have conservationists and independent people on it. The honourable member will find it to be a committee whose judgments we can trust. I just say to people at this stage not to panic. Tasmanians have a tendency at times to go off the air when some of these issues are mentioned. I believe that this matter can be satisfactorily resolved. I will certainly take note of the honourable member's comments and see that they are referred to the appropriate authorities. Madam SPEAKER —Order! The debate having concluded, the House stands adjourned until 10 a.m. tomorrow. House adjourned at 11.08 p.m. The following papers were deemed to have been presented on 7 October 1986: Affirmative Action (Equal Employment Opportunity for Women) Act-Regulations-Statutory Rules 1986, No. 282. Air Navigation Act-Regulations-Statutory Rules 1986, No. 284. Bounty and subsidy Acts-Returns for 1985-86, pursuant to the following Acts- Automatic Data Processing Equipment Bounty. Bounty (Agricultural Tractors). Bounty (Agricultural Tractors and Equipment). Bounty (Bed Sheeting). Bounty (Berry Fruits). Bounty (Books). Bounty (Commercial Motor Vehicles). Bounty (Computers). Bounty (Electric Motors). Bounty (High Alloy Steel Products). Bounty (Injection-moulding Equipment). Bounty (Metal-Working Machine Tools). Bounty (Metal-Working Machines and Robots). Bounty (Paper). Bounty (Penicillin). Bounty (Printed Fabrics). Bounty (Ships). Bounty (Steel Mill Products). Bounty (Textile Yarns). Bounty (Tractor Cabs). Bounty (Two-Stroke Engines). Nitrogenous Fertilizers Subsidy). Phosphate Fertilizers Subsidy). Ship Construction Bounty. Subsidy (Grain Harvesters and Equipment). Bounty (Metal Working Machines and Robots) Act-Declaration pursuant to sub-sections 8 (2) and (4), dated 28 September 1986. Canberra College of Advanced Education Act-Statute-No. 60-Courses and Awards Amendment (No. 2) 1986. Christmas Island Act-Ordinance-1986-No. 2-Christmas Island Assembly (Election) Regulations (Amendment). Commonwealth Inscribed Stock Act-Regulations-Statutory Rules 1986, No. 264. Companies Act-Regulations-Statutory Rules 1986, No. 247. Customs Act-Regulations-Statutory Rules 1986, No. 248. Defence Act-Determination-1986-No. 57-Intermediate Term Duty Living Allowance and other allowances. Designs Act-Regulations-Statutory Rules 1986, No. 263. Excise Act-Regulations-Statutory Rules 1986, No. 249. Export Inspection (Establishment Registration Charge) Act-Regulations-Statutory Rules 1986, No. 252. Export Inspection (Quantity Charge) Act-Regulations-Statutory Rules 1986, No. 251. Export Inspection (Service Charge) Act-Regulations-Statutory Rules 1986, No. 253. Health Insurance Act-Regulations-Statutory Rules 1986, No. 275. Home and Community Care Act-Agreement between the Commonwealth and the State of Queensland, pursuant to sub-section 3 (2), dated 9 July 1986. Lands Acquisition Act- Land acquired for the purpose of telecommunications services-Parish of Scarsdale, Vic. Statements (3) of lands acquired by agreement authorised under sub-section 7 (1). Liquefied Petroleum Gas (Grants) Act-Determination pursuant to sub-section 6a (3) fixing wholesale price of liquefied petroleum gas, dated 24 September 1986. Live-stock Slaughter (Export Inspection Charge) Act-Regulations-Statutory Rules 1986, No. 254. National Library Act-Regulations-Statutory Rules 1986, No. 285. Navigation Act-Regulations-Statutory Rules 1986, Nos. 269, 270, 271, 272, 273, 274. Patents Act-Regulations-Statutory Rules 1986, Nos. 259, 260. Proclamations by His Excellency the Governor- General fixing the dates on which the following Acts and sections of Acts shall come into operation- Affirmative Action (Equal Employment Opportunity for Women Act 1986-1 October 1986. Commonwealth Education Institutions (Overseas Students) Amendment Act 1985-1 October 1986. Health Legislation Amendment Act 1986-Sections 8, 9, 10, 12, 13, 14, 16, 20 and 21, and sub-section 47 (2)-26 September 1986. Shipping Registration Amendment Act 1984-Section 8-1 October 1986. Public Service Act- Determinations-1986-Nos. 69, 70, 73, 74. Regulations-Statutory Rules 1986, No. 256. Quarantine Act-Regulations-Statutory Rules 1986, No. 283. Radiocommunications Act-Regulations-Statutory Rules 1986, No. 278. Radiocommunications (Frequency Reservation Certificate Tax) Act-Regulations-Statutory Rules 1986, No. 276. Radiocommunications (Receiver Licence Tax) Act-Regulations-Statutory Rules 1986, No. 279. Radiocommunications (Temporary Permit Tax) Act-Regulations-Statutory Rules 1986, No. 280. Radiocommunications (Test Permit Tax) Act-Regulations-Statutory Rules 1986, No. 277. Radiocommunications (Transmitter Licence Tax) Act-Regulations-Statutory Rules 1986, No. 281. Remuneration Tribunals Act-Regulations-Statutory Rules 1986, No. 258. Seat of Government (Administration) Act-Ordinance-1986-No. 56-Credit (Amendment) (No. 3). Shipping Registration Act-Regulations-Statutory Rules 1986, Nos. 267, 268. Superannuation Act-Regulations-Statutory Rules 1986 Nos. 250, 265, 266. Telecommunications Act- Australian Telecommunications Commission-By-laws- Telecommunications (Charging Zones and Charging Districts) Amendment No. 71. Telecommunications (Community Calls) Amendment No. 45. Regulations-Statutory Rules 1986, No. 257. Trade Marks Act-Regulations-Statutory Rules 1986, Nos 261, 262. Trade Practices Act-Regulations-Regulations-Statutory Rules 1986, No. 255. Wool Industry Act-Regulations-Statutory Rules 1986, No. 286.