Tuesday, 24 November 1987 Mr ACTING SPEAKER (Mr Leo McLeay) took the chair at 2 p.m. and read prayers. Mr HAWKE(Wills-Prime Minister) —I inform the House that the Minister for Industrial Relations, Mr Willis, left on 20 November on Government business overseas. He will return to Australia on 6 December and in his absence the Minister for Immigration, Local Government and Ethnic Affairs, Mr Young, is the Acting Minister for Industrial Relations. Mr HOWARD —My question is directed to the Prime Minister. I refer him to the soon to be signed human contacts treaty with the Soviet Union and, in particular, those provisions that will streamline Australian visas for Soviet visitors allowing a wide range of Soviet contacts with Australian institutions. Will the Prime Minister give an assurance that these provisions will not assist the Soviet strategy of acquiring Western technology and placing agents of influence in Western institutions? In view of the recent expulsion of an east European diplomat's son from Australia for illegal technology transfers, does the proposed treaty have the support of all of our relevant security and intelligence agencies? Finally, is the Prime Minister aware that human contacts is an area handled by the active measures program administered by the directorate of the KGB, otherwise known as the disinformation department? Mr HAWKE —I am confident that those matters of concern which were raised in the first part of the Leader of the Opposition's question will be appropriately covered and that we would not, in any of those respects, be disadvantaged by what will be done in the agreement to which he referred. I have no recollection of any indication that what we are proposing in this area is being opposed by any of the intelligence agencies. Therefore, this part of what will be fairly comprehensive discussions with the leadership in the Soviet Union will be part of a package which will be of benefit to this country as a whole. Ms McHUGH —Is the Minister for Social Security aware of concerns expressed by sole parent organisations about sole parents with disabled children losing pension entitlement? Can the Minister inform the House what the position is for these pensioners? Mr HOWE —I thank the honourable member for Phillip for her question. I am aware of the concern that sole parents who have a disabled child who is a full time student have as of 1 September been losing their entitlement to a pension when the youngest child turns 16 years. The Government does not believe that having a full time student and a child over 16 years of age, by itself, stops anybody from working. However, where a child is disabled and needs special care from his or her parent, that can stop the parent working. It is also a qualifying condition for the payment of the handicapped child allowance, now called the child disability allowance, that the child needs constant care and attention. This could not be guaranteed if the parent were to enter the work force or to seek work. Accordingly, it has been decided to restore the eligibility of such parents for a pension for as long as the child remains a dependent student and attracts the disabled child allowance. Amending legislation with retrospective cover will be included in the next social security Bill to come before the Parliament. This means that a sole parent with a disabled child can continue to receive the pension until the child turns 25. Sole parents with such children, whose pension has already been cancelled, will have their pension reinstated from the date of cancellation. The Department is already aware of a few individual cases which will be assisted by this initiative and will be making every effort to identify others. However, I would strongly urge sole parents in these circumstances who are not promptly contacted by the Department to contact their local office as quickly as possible. Mr PEACOCK —I refer the Treasurer to a report in this morning's Australian Financial Review concerning the consideration of a plan to sell 30 per cent of the Australian Industry Development Corporation (AIDC). The report mentions: The aim of the proposed float of 30 per cent is to raise, as quickly as possible, about $40 million in new capital to allow the corporation to boost its investment in less commercial development projects. I ask the Treasurer: How can the AIDC successfully float equity in the market-place if the additional equity is to be used to finance less commercial development projects, which would presumably yield a rate of return below that of the market? Is the Government proposing to subsidise the undertaking of additional less commercial projects in order to generate a competitive rate of return? Mr KEATING —I think there is a submission about in respect of the AIDC's capital requirements, but it has not gone to the Cabinet at this stage. Mr LANGMORE —My question is addressed to the Minister for the Arts, Sport, the Environment, Tourism and Territories. I ask whether he is aware of recent statements by the President of the Australian Capital Territory (ACT) branch of the Australian Medical Association (AMA), Dr McNicol, that the Government had capitulated to the AMA's demands in the settlement of the ACT doctors dispute. Mr JOHN BROWN —I am aware of those statements, and I thank the honourable member for his question. He has been one of the community leaders in the forefront of demanding a settlement of the strike and I am pleased to advise the House that it has been settled on reasonable terms. Earlier this year the ACT branch of the Australian Medical Association put a remarkable claim before the Government. This was to be the basis of new contracts with private medical practitioners for the treatment of public patients in public hospitals. This claim, if accepted, would have raised the annual cost from $4m to around $7.5m, a rise of almost 90 per cent. The claim was based on a few very notable components: first of all, the use of the AMA fee schedule as the basis of modified fee for service payments in lieu of the Government's Medicare benefits schedule, with which, of course, this Government has complied strictly while demanding that the States do likewise; secondly, the annual indexation of fee schedule on the basis of movements in average weekly earnings; thirdly, on-call contract payments of $180 per day for anaesthetists and $120 a day for other specialists; fourthly, a loading of 50 per cent on the fee for services provided outside normal working hours; and, finally, compensation for normal operating theatre time cancelled by a hospital without reasonable notice. This claim, demanding as it was, was later extended to include sessional remuneration equivalent to that offered in New South Wales public hospitals. The Government has rejected from the outset any notion of the AMA fee schedule being the basis of remuneration for private medical practitioners, and I would hope that all members of the House would support that proposition. It has also rejected the idea of a fee loading for services provided outside normal hours. Further, the Government has not been prepared to accept a sessional remuneration package based on the excessive rates which apply under the Macken determination in New South Wales. Rather, the Government has approved a fair and responsible package which relies on the Government's medical fee schedule. It provides indexation at a rate which will ensure that the medical profession shares fully the income restraint that has been experienced by the general community. It includes provision for a modest on-call contract payment of $60 per day for specialists rostered on call by a hospital. It allows reasonable compensation for operating theatre time cancelled at short notice and offers sessional remuneration equivalent to that which is offered by the Commonwealth in New South Wales repatriation hospitals. This arrangement provides for a maximum hourly payment of $94 compared with the $119 offered in New South Wales public hospitals. For the information of honourable members, I point out that during the dispute the doctors made a song and dance about providing emergency work on a voluntary basis. However, as part of their determination they demanded payment for these services, cancelling all that nonsense about voluntary work. The settlement package which I have outlined obviously is not as the AMA claimed in the last few days. It is substantially different in style and content and the annual cost will be less than $6m, a saving of over $1.5m on the original AMA claim and up to $2m on its revised claim. I hope that now the doctors have agreed to go back to work they will stay at work, that they will take advantage of the settlement procedures which are now in place and that in future the people of Canberra can look forward to services from doctors, who are in a very privileged position, of the style that Canberra people are entitled to from people who have taken the Hippocratic oath. Mr LLOYD —Is the Prime Minister aware of criticism by the National Farmers Federation and other farmer organisations that they were not consulted before the Prime Minister left for New Zealand to discuss with the New Zealand Prime Minister changes to the closer economic relations (CER) agreement? What new commitments, if any, were made at that meeting on agricultural trade with New Zealand, especially in relation to meat, dairying and horticulture? Will the Prime Minister give an assurance that there will be discussions with the respective producer organisations before committing Australia to any further changes to the closer economic relations agreement including the existing industry arrangements under the memorandum of understanding? Mr HAWKE —I can say that I am not aware of any such criticism by the National Farmers Federation. I must say that these days I am getting used to being congratulated by that organisation. I would have been surprised if on this occasion it had changed its better ways of recent times. After Question Time, with the leave of the House, I will be making a detailed statement on the visit to New Zealand including the discussions with regard to CER. Essentially in this area we have agreed that officials will have discussions now and at the beginning of next year, that Ministers will meet in June of next year and that Prime Minister Lange and me will be meeting about August next year to review the work of officials and of Ministers. Of course, as those discussions proceed it will be my clear expectation that interested groups will be involved in consultations with our officials and that there will be every opportunity for an appropriate input from the National Farmers Federation to the discussions. On the particular question of dairying, let me say that the position we have put to the New Zealanders, to which they are agreeable, is that that is covered, as was indicated by the honourable member, by a memorandum of understanding. We regard it as appropriate that the discussions on the issue of dairying should be conducted between the two industry associations. Mr SCIACCA —Has the attention of the Minister for Immigration, Local Government and Ethnic Affairs been drawn to a story in this morning's Press outlining the view of Senator Stone and Senator Sheil of the National Party of Australia that the Government should stop non-English speaking migrants from coming to Australia? Can the Minister outline to the House the implications of such a proposal, were it to be taken seriously by the Government, for Australia's migration program? Is the Minister aware that had this attitude been Australia's policy after World War II Australia would never have realised the massive benefits of the post-war migration which occurred and that, in fact, I would not be standing here today asking this question? Mr YOUNG —Mr Acting Speaker, I am aware of the comments that have been made by Senator Sheil and Senator Stone. This is the second time Senator Sheil, in his very illustrious career in Parliament, has made the newspapers, basically on the same issue. I am also aware of the position the honourable member may have been placed in had their policy been retrospective. In the honourable member's case, as I understand from reading newspapers, there may have been some other factors. I am also pleased to acknowledge the statements made by the shadow Minister in the Opposition, the honourable member for Mitchell, and the Leader of the Opposition dissociating themselves and saying that the statements made by the two senators are quite contrary to the policy and the bipartisan attitude that this Parliament has had on the question of a non-discriminatory migration program to this country. We are not too sure, and I do not think the people who made these statements are quite sure, whether they made them in the light of their views about people who come from non-English speaking backgrounds, or whether in fact they believe there is another program that can be adopted that would be better than teaching English in Australia and that perhaps we could have these programs operating overseas. In both cases they are wrong. Until 1977 we did have quite an extensive provision for English language instruction before the arrival of migrants in Australia. Almost every program that was conducted, by both governments, was singularly unsuccessful. One of the reasons we have a backlog of about 200,000 people now waiting to learn English is the unsatisfactory administration of those programs. This Government and the previous government recognised that learning English is central to every aspect of life in this country. If we want people to have equality, equity and access to all the provisions that Australia has to offer, the English language is central to all of them. Senator Stone and Senator Sheil seem to belie and belittle the contribution that has been made to this country by people who have come from non-English speaking backgrounds. I think we should reiterate what has happened in this country since 1947. In addition to the 1.8 million people who have come from the United Kingdom and Ireland, 382,000 have come from Italy, 227,000 have come from Greece, 186,000 have come from Yugoslavia, 166,000 have come from the Netherlands, 144,000 have come from Germany, 105,000 have come from Poland, and 91,000 have come from Vietnam, together with people from almost every country on the globe. The two gentlemen in the Senate ought to take into account some of the significant figures who have played a role in this country who would not have been here under the policy now being espoused by them. Sir John Monash's parents were German. Ferdinand Mueller, our greatest botanist, was a German. Carboni, a participant in and the historian of the Eureka Stockade, was, of course, Italian. Von Guerard, one of our leading nineteenth century artists; Leichhardt, one of the great explorers of this country-- Mr McVeigh —He could speak English. Mr YOUNG —The honourable member should go to the college on the Darling Downs and it will explain this to him. Even today, at 86 years of age, a person visits the Commonwealth Scientific and Industrial Research Organisation to make his contribution on behalf of this Parliament and this country-I refer to Sir Otto Frankel, our leading plant geneticist. Bernard Neumann is our leading mathematician. Then there is Sir Arvi Parbo, and in this Parliament are several members, not only the honourable member for Bowman, but the honourable member for Prospect, the honourable member for Hotham and the honourable member for Calwell, and other members of this Parliament-the honourable member for Kennedy puts up his hand-- Mr Donald Cameron —What about Joh? Mr YOUNG —I am leaving Joh until last. I also acknowledge, Mr Acting Speaker, that it was the Galbally Review of Post-arrival Programs and Services to Migrants which very much focused the attention of the Fraser Government on the need to boost spending on English language courses in this country. If you look at the record, you will find that the Fraser Government was the government that gave great stimulation to English language courses in this country, which we have followed. I do not know what the Secretary to the Treasury at that time had to say about these programs. But one is dismayed to think that a person who is now making these comments was in charge of the most important government department. It is rumoured that he is to run as Leader of the National Party. He wants to come down to the lower House and has bought a house in the electorate of Fairfax. He should have a yarn to the honourable member for Fairfax who can tell him that there are 7,000 migrants in that electorate from non-English speaking backgrounds. They come from Austria, Chile, China, Cyprus, Czechoslovakia, Egypt, France, Germany, Greece, Hong Kong, India, Indonesia, Italy, Latvia, Lebanon, Malaysia and the list goes on and on, as it does for every electorate in this country. The contribution of these people has been enormous and should be acknowledged. The one great thing about this Parliament is that we have had a bipartisan view on this subject. There may be arguments about the extent of the resources that can be put at the disposal of these various programs, but we have never argued that the programs are unnecessary or as to whether they are in the best interests of this country. Everybody in this Parliament and people outside who observe the mutterings of the Stones and the Sheils should condemn them for what they stand for. Mr HALVERSON —I ask the Prime Minister whether he agrees with the view of the Minister for Transport and Communications that there is: . . . a quite major Budgetary problem looming ahead for the Government: for three enterprises alone-Qantas, Australian Airlines and . . . the Commonwealth Bank-and that the Budgetary outlay required will be, over the next few years, of the order of $1 billion. Does the Prime Minister also agree that if these outlays are to be provided by the private sector, partial or full privatisation of the enterprises concerned needs to proceed promptly? Mr HAWKE —I have observed the comments in speeches by the Minister for Transport and Communications, Senator Gareth Evans. It will come as no surprise to the honourable member for Casey that I have considerable sympathy with the views expressed by Senator Evans. As for what will happen to government policy in this area, it is no secret that what is about to transpire is a considered discussion and debate within my Party on the question of the future operation of a range of publicly owned enterprises. I take this opportunity to say what I said to this House relatively recently. There is a great distinction between honourable members on the Government benches and Opposition members on the way we approach this issue. Mr Howard —Oh! Mr HAWKE —Here goes the giggler again. Among Opposition members there is a view which replicates the attitude of the United Kingdom Government that there is something intrinsically bad about the public sector and something intrinsically better in the operation of an enterprise by the private sector. Speaking for myself, Senator Evans and all Labor members, we have no such ideological mania. My concern, which will be the area of discussion within the Party and the Government on this side of the House, is the question of priorities and how the needs of the Australian people in the various priorities that we have in those areas will best be served. None of us, and neither Senator Evans nor myself, will be driven by the ideological hangup which affects Opposition members. As I said the other day, the other comparison is that on this side of the House I have encouraged-and I am glad to see that there has been virtually a unanimous response on this side-such a discussion within our Party. I contrasted our approach with what happens in the Opposition. The Leader of the Opposition has a view that all wisdom in matters economic, social and otherwise resides with him, and that if other members, whether it be the honourable member for Boothby, the honourable member for Goldstein or Senator Peter Baume, take a different view from the Leader of the Opposition, they are not encouraged to have a debate properly within their party forum. They get booted out from the front bench and put up the back. That is one of the very obvious distinguishing characteristics between the two sides of the House. We will address the issues and have a healthy debate on them. While the Leader of the Opposition is the leader of the Liberal Party-and I pray earnestly that he will stay there-the Liberals will continue to stay in opposition. Debate is stifled in the Opposition ranks and honourable members opposite flounder around without any idea of a sensible way of trying to address themselves to the real issues of concern to this country. Ms CRAWFORD —My question, which is addressed to the Minister for Social Security, concerns the possibility of more disarray and distress in Queensland. Is the Minister aware of moves by the Queensland Government to slash the living standards of poor families in that State? Mr HOWE —I am aware that the Director-General of the Queensland Department of Family and Youth Services recently wrote to families receiving emergency relief payments for children informing them that the Queensland Government had terminated the payment. The allowance was worth $16.95 a week. To many members that may not sound like a great deal of money, but I am sure it will make a considerable difference to those very low income families concerned. It is interesting that that should happen in Queensland, whereas in Victoria, under its social justice strategy, the Government is redirecting State finances to achieve a fairer and equitable distribution of resources. Under that strategy the Victorian Government is introducing the educational maintenance allowance for school students of very low income families. Of course, all governments have to exercise greater financial stringency. The Commonwealth Government has done so. It has balanced the Budget and has also delivered the family assistance package with major improvements in income security for low income families. The Victorian Government-as I suggested-has delivered complementary, but nevertheless significant, income support for low income families with children at school. At this time the Queensland Government has slashed income support for those families and has the hide to blame the Commonwealth. Queensland was treated the same way as the other States in terms of Commonwealth assistance for 1987-88. In any case, at the 1987 Premiers Conference the Queensland Premier called for an even greater real cut than was actually made in Commonwealth funding to the States. At a time in which the Federal Government has sought to focus attention and has contributed very real and significant resources in support of low income families, the Queensland Government has not found even sufficient priority to maintain emergency relief payments to student children. Mr KATTER —Will the Minister for Immigration, Local Government and Ethnic Affairs give an assurance that worthy migrants will not be prevented from entering this country by any language barrier? Will he further give an assurance that non-English speaking migrants will be given every encouragement and improved facilities to learn English as urgently as possible? Will he also give an assurance that worthy migrants from countries such as Lebanon, where there is a high degree of genocide, will have their access to this country made a little easier than it is at the moment? Mr YOUNG —I thank the honourable member for his question. Firstly, in relation to Lebanon, it is a very sad story as far as many Australian citizens are concerned. We have quite a big Lebanese community in this country and I meet delegations from various communities regularly to talk about the problems. At various times in both the previous Government and in this Government we have had special humanitarian programs to deal with specific episodes that have dislocated the lives of a lot of people in Lebanon and which have facilitated the entry into this country of a higher number of Lebanese people than otherwise would be the case. At the moment frustration is being experienced by people in the Lebanon because of security problems. We are unable to open an office in Beirut. People have to travel to Damascus, which causes them a great deal of inconvenience, to be interviewed and place their applications for entry into this country. The Prime Minister has made it clear that as soon as we receive word that security can be restored in Beirut we will be re-opening our office there. To the extent that the honourable member talks about the benefits that might flow to people who come from non-English speaking backgrounds, Australia has provided, not just to migrants of non-English speaking backgrounds but to all migrants, a great environment for them to rebuild their lives, in many cases, an education second to none for their children and opportunities that would not be available in many other countries. The retention of their languages and cultures is second to none in this country. Many people who travel to this country are absolutely astounded at the way in which communities have been able to retain their cultures as very much part of the environment which Australia has provided. At the moment we are inundated with applications from people who would like to live here. We estimate that we get 1.2 million serious inquiries a year from people who would like to migrate to Australia. As we stipulate an intake, of all categories, of 120,000 it means that we are saying no to nine out of 10 people. Australia can be proud of what has happened here since World War II, in particular, in regard to the settlement of migrants. We have learnt a lot. Many of the settlement services we now have in place were not in place in those early years. We no longer see migrants as just being fodder for the factories or in terms of the work they might be able to do but also for the contributions they can make. Almost every walk of life, whether it be academia, politics, trade unions or business has been affected by the fact that people have come from all over the world to live in this country. It is a lesson for all to observe: we can go on building this country in the way we have done with the continuation of these programs. Mr Katter —Mr Acting Speaker, I take a point of order. With respect, I ask the Minister to answer the first part of my question. I asked him to give an assurance that people who are unable to speak English will be permitted to enter this country. Mr ACTING SPEAKER —The Minister does not have to answer that question. Mr YOUNG —I can give a better assurance than that. There will be no moving away from the absolutely non-discriminatory policy which both parties have observed for the last 15 years. Mr BILNEY —My question is addressed to the Minister for Community Services and Health and relates to an issue of great public importance. Has the Minister noted the recent recommendation of the National Health and Medical Research Council that vitamin B1, thiamine, be added to a number of staple foods in order to prevent the emergence of the Wernicke Korsakoff syndrome? Is it the case that each year in Australia some 300 people are admitted to hospital, at great social and economic cost, with this largely preventable disease? What action will the Government be taking to allow the addition of thiamine to staple foods, such as beer, wine and bread, as a proven prophylactic public health measure? Dr BLEWETT —I thank the honourable member for his question and note that he has made persistent representations on this matter over the past 18 months. I have noted that the National Health and Medical Research Council has recommended the addition of thiamine to certain alcoholic beverages as a means of reducing the incidence of Wernicke Korsakoff syndrome. This is a serious and potentially fatal brain disorder which has been shown to be associated with a deficiency of vitamin B1, thiamine. We have an estimated 500 to 600 cases a year in this country of this disease. If it is untreated, or is unsuccessfully treated, the condition progresses to a further stage of mental illness which usually requires permanent institutional care. There have been many years of debate on this issue within the National Health and Medical Research Council, and the Council has now concluded that there is sufficient evidence that the addition of thiamine to certain alcoholic beverages would be likely to prevent a significant number of cases of this disease. It has therefore recommended that that practice be adopted because it represents an effective public health illness prevention measure. The Council has further recommended that thiamine be added to beer, cask and flagon wines and fortified wines as the most significant beverages affected. Mr Porter —Have you tasted it? Dr BLEWETT —In response to the query from the honourable member for Barker, I am advised by the National Health and Medical Research Council that, if thiamine were added at the rate suggested, it would have no effect on taste or colour. This recommendation of the National Health and Medical Research Council has been passed to the Australian Health Ministers Conference and to the Ministerial Council on Drug Strategy for endorsement, and I shall be discussing this matter with my colleagues on both of those bodies as soon as possible with a view to seeking implementation of the suggestion. I have also arranged for early consultations between the alcohol sub-committee of the Ministerial Council on Drug Strategy and the industry itself, provided that my colleagues in the States agree to that proposal, so that we can work with the industry to implement this policy. Finally, the other recommendation from the National Health and Medical Research Council that thiamine should also be included in flour and bread is being treated as a separate issue and is dealt with in the national dietary survey soon to be released. Mr McARTHUR —Does the Prime Minister recall saying shortly after the election that, if some Government bodies were privatised and freed from Government restraints, those enterprises may become more efficient and more viable, an outcome which could only benefit consumers, taxpayers and the employees of the enterprises concerned? Does he also recall saying before the election that privatisation was a one-off fire sale, a sale of the century of your assets? Given the Prime Minister's panic meetings last night and today with the Centre Left faction, what is his current view of privatisation; or, more to the point, what are the factions telling him his view is? Mr HAWKE —I thank the honourable member for Corangamite for his profound question. I can assure the honourable gentlemen that the meetings I had last night were not panic meetings. They were very congenial and produced an outcome of a consensus kind, which I am accustomed to being associated with; and I appreciate the good efforts of everyone involved to produce such a sensible and consensual outcome. No one tells me what my views on anything will be, whether it be privatisation or anything else-with the possible exception that sometimes my wife makes very strong recommendations as to how I should think about certain things, but not privatisation. I remind the honourable gentleman of what I said before. What will happen is that there will be within my Party and its various processes here within the Parliament and elsewhere a discussion about these matters. A very sensible decision has been taken which will mean that the Ministers involved, in collaboration with representative bodies from the Caucus, will examine what would be involved in ensuring that existing enterprises were viable and kept in effective public ownership. That is a sensible approach so that there will be exposed what is necessary to achieve those objectives. Within that process of exposure of the facts, various people will have different views, not necessarily generally about all enterprises; some will have different views about one from another. I believe that, at the end of this process, we will have on this side of the House a sensible appreciation of what is necessary, as I have said before, to advance the interests of the people of this country. I simply reiterate what I said before: That process of healthy discussion and debate on this side of the House stands in stark and healthy contrast with the way members on the Opposition side of the House muddle through; and as they continue to do that they will remain on the left hand side of the Speaker. Mr GORMAN —Is the Minister for Consumer Affairs aware of the recent announcement by Bridgestone Australia Ltd on the recall of many faulty tyres? Are more products being recalled now than in the past? Does the Government consider this to be a problem? Mr STAPLES —Bridgestone Australia Ltd has notified me that a safety-related defect has been identified with tyres manufactured in its factory between 14 and 26 September of this year. I understand that officers of the Federal Bureau of Consumer Affairs and the Federal Office of Road Safety recently met with representatives from Bridgestone Australia concerning this recall. As the suspect tyres have been supplied to retail outlets and also to major car manufacturers as original equipment, Bridgestone will be conducting a national recall on 25 November in conjunction with action to be taken by major car manufacturers. In respect of that part of the question concerning the increase in the number of recalls, the number of voluntary recalls of products notified since the introduction of the recall provisions of the Trade Practices Act in July 1986 has now reached 225. From July to November 1986 the number of recalls was 60; and from July to November 1987 the number was 86. Therefore, there has been a significant increase in the number of recalls undertaken by companies in Australia over the past five months compared with the same period last year. This increase could be attributed to the greater awareness among Australian companies: firstly, of the need to ensure that their products do not pose a risk to the user; and secondly, of the requirement now under the Trade Practices Act to notify the voluntary recall action. The voluntary recall system does appear to be working well overall. I commend manufacturers such as Bridgestone Australia Ltd for their generally responsible attitude to the Trade Practices Act and the safety of consumers. While on this question of recalls, I should bring to the attention of the House again the issue of quality generally and a need in Australian manufacturing to ensure not just that recalls work effectively but also that quality is built into more on-line production in design engineering, materials and manufacture. Mr HOWARD —Does the Prime Minister agree with the statement from the parliamentary Left of the Australian Labor Party that today's Caucus decision on privatisation was an important and vital victory which would enhance authorities in full public ownership? If not, why not? Mr HAWKE —Mr Acting Speaker, they seem to be tigers for punishment on the other side of the House. I have answered the question about what is happening on this side of the House on this issue twice already, and I will, therefore, as I am asked to do, go to it a third time. A position has been reached where there will be the process of discussion and debate within the parliamentary Labor Party. It will be an exposure of the facts with regard to what is necessary to maintain viable and effective ownership of existing public enterprises. I do not know what statements may have been made to this point other than the ones that I have made myself. If there has been any victory, it has been a victory for sanity and for those who want a serious, sensible exposure of the facts and a debate and discussion within the Government on the basis of those exposed facts. I regard that as a victory for nothing other than sanity. Mr SIMMONS —I ask the Minister for Primary Industries and Energy: Has his attention been drawn to yesterday's announcement by Austen and Butta Ltd giving details of the closure of the Invincible colliery? Did Austen and Butta seek rail freight reductions in the order of $5.50 a tonne, or about a 50 per cent reduction, to alleviate the company's problems? Can the Minister confirm whether it was stated in the company's media release that even if such concessions were granted further management and operating savings in excess of $7 a tonne would be required to keep the mine viable? In view of the obvious concern in the Lithgow region about the future of the coal industry, what action is being formulated by the Federal Government to develop a long term strategy? Mr KERIN —The honourable member seems to have the picture of this most unfortunate closure pretty well in his mind. Of course the mine is in his electorate and he takes a close interest in this industry. Austen and Butta Ltd announced its intention yesterday to close the Invincible colliery located near Lithgow. The company's intention is that the mine operation should be wound down over the period to March 1988 by which time the work force of 267 people will be wholly retrenched and 124 workers will be retrenched immediately. The Chairman of Austen and Butta has stated that closure of the mine will result in a loss of export income of $50m and a loss of State government revenue of $26m. He said that for the mine to survive further capital investment from shareholders, changes in work practices and reductions in State government charges would have been needed. The Commonwealth and New South Wales assistance package announced recently, which amounts to some $40m over two years and is equally funded by the Commonwealth and the State, is designed to finance a reduction in State government charges on export coal mines in the form of agreed reductions in State Rail Authority charges for eligible mines. The figures I gave a moment ago should indicate the level of charges on that one mine. In determining eligibility the Commonwealth Government is requiring that progress should be made in reducing mine site costs. The prospective wind-down of the Invincible colliery is of particular concern to the Government as this mine is one at which some changes in work practices have occurred, although the mine operators claim that there is room for further changes. Earlier the company had taken decisions to invest in longwall mining equipment but it had a problem at one time with a large roof failure. Another factor adding to its problems was the national seven-day shutdown in September which cost us 140,000 tonnes of production and also made the negotiation of contracts after March next year more difficult. Regarding the short term and long term strategies we are developing, it could have been expected that a mine such as Invincible would have had a good case for seeking to be included in the program. It is unfortunate that that will not take place. I emphasise that the assistance program which is being put in place is designed to assist those mines with the prospect of long term viability in the export industry. It might well be that not all of the mines affected by the current restructuring of the industry will find the level of assistance available sufficient to justify their continued operations. In this context, as the honourable member has noted, I note that Austen and Butta were seeking government charge reductions of $5.50 per tonne. Mr ACTING SPEAKER —I present, pursuant to statute, the report of the Auditor-General, accompanied by the financial statements prepared by the Minister for Finance, and certificates of exempt accounts for the year ended 30 June 1987. Motion (by Mr Young)-by leave- agreed to: (1) That this House, in accordance with the provisions of the Parliamentary Papers Act 1908, authorises the publication of the report of the Auditor-General accompanied by the financial statements prepared by the Minister for Finance for the year ended 30 June 1987, and (2) That the papers be printed. Mr YOUNG(Port Adelaide-Leader of the House) —For the information of honourable members, I present the Government's response to the schedule of outstanding Government responses to parliamentary committee reports tabled by the Speaker on 3 November 1987. I seek leave to have the schedule incorporated in Hansard. Leave granted. The schedule read as follows- HOUSE OF REPRESENTATIVES STANDING COMMITTEES Aboriginal Affairs (i) ``Return to the Country-The Aboriginal Homelands Movement in Australia''. (Tabled 14.5.87) The Minister for Aboriginal Affairs is preparing a co-ordinated response for the Government's consideration and expects to be in a position to respond to the Report this Sittings. Environment and Conservation (i) Conservation-Hazardous Chemical Waste Storage, Transport and Disposal (Tabled 29.4.82) Hazardous Chemicals-2nd Report (Tabled 9.12.82) Preparation of responses to these reports has involved extensive interdepartmental consultation, and it has been necessary to take into account the frequent and numerous developments which have occurred in areas addressed by the Committee's recommendations. The Government is co-operating with State and Territory Governments on the development and implementation of a national approach to hazardous waste management, broadly consistent with the Committee's recommendations in its report on chemical wastes. With respect to the second report, legislation for a national notification and assessment scheme for industrial chemicals is being finalised. (ii) Protection of the Greater Daintree (Tabled 24.8.84) The Standing Committee's recommendations concerned the assessment of the World Heritage status of the Greater Daintree area, avoidance of damage to the area by the construction of the then proposed road from Cape Tribulation to Bloomfield, and associated consultations with the Queensland Government. The Cape Tribulation to Bloomfield Road was constructed, with concomitant damage to the immediate environment. The impact of the road upon the fringing reefs in the adjacent Great Barrier Reef Marine Park is being monitored by the Great Barrier Reef Marine Park Authority. On the 5 June 1987 the Prime Minister and the then Minister for Arts, Heritage and Environment announced that the Government would immediately proceed towards nomination of the wet tropical rainforests of North and East Queensland for World Heritage listing in recognition of the outstanding conservation values of the region. The Government's decision on this matter followed discussions with the Queensland Government concerning rainforest conservation, in the course of which the Commonwealth offered substantial funds to Queensland under the National Rainforest Conservation Program in the expectation that Queensland would enter into acceptable rainforest conservation arrangements particularly for cessation of logging. Queensland nevertheless maintained that rainforests logging should continue. The Government has sought to formally consult the Queensland Government on World Heritage listing of the wet tropical rainforests, and has initiated a process of public consultation. The Government is hopeful that Queensland will ultimately participate in discussions. (iii) Protection of Bungle Bungle (Tabled 28.3.85) The then Minister for Arts, Heritage and Environment tabled a response to this Report in the House on 26 May 1987. (iv) Protection of the Great Barrier Reef (Tabled 12.11.85) The then Minister for Arts, Heritage and Environment tabled a response to this Report in the House on 1 June 1987. (v) NSW World Heritage Properties: Commonwealth/State Administrative Arrangements (Tabled 26.11.85) The Minister for Arts, Sport the Environment, Tourism and Territories expects to be in a position to respond to the Committee's report this Sittings. (vi) Namadgi National Park (Tabled 14.10.86) Whilst many of the recommendations are supported and a number have already been implemented a response was delayed pending resolution of remaining issues between the then Ministers for Territories and Arts, Heritage and Environment prior to the election. The Government expects to be in a position to respond to the Committee's report this Sittings. (vii) Ranger Uranium Water Management System (Tabled 16.10.86) In a joint press release issued on 30 March 1987, the then Ministers for Resources and Energy and for Arts, Heritage and Environment stated that the Government has decided to refuse permission for the release of any water from the mine this year, to require Ranger to proceed immediately to deepen the existing retention pond by the end of this year, and to instruct the Supervising Scientist for the Alligator Rivers Region, in consultation with Ranger, to develop practicable and environmentally acceptable options aimed at ensuring that Ranger water management is fully consistent with protection of the environment. The then Ministers also said in their statement that in reaching its decision, the Government had close regard not only to the scientific and technical issues considered in the technical working group report, but also to the range of social and other issues addressed in the Report of the Standing Committee. Although the Report contained no specific recommendations, its conclusions were taken into account in determining the Government's decision. The text of the joint press release has been provided to the Chairman of the Committee and represents the Government's response. (viii) Fiscal Measures and Achievement of Environment Objectives (Tabled 19.2.87) The Government has made several changes to the tax system that are consistent with the recommendations of the report, such as removing some incentives that existed for land clearing and introducing a capital gains tax. Recent Commonwealth initiatives under the National Rainforest Conservation Program and the National Afforestation Program are also consistent with recommendations of the report with respect to management of forests and tree planting. Consultations are under way with several departments on the remaining recommendations in the report. A full response to the report will be prepared on the completion of these consultations. Expenditure (i) Control of Prohibited Immigration by the Department of Immigration and Ethnic Affairs (Tabled 13.11.85) Most of the recommendations of the Report have been adopted and either implemented or substantial progress toward implementation has been achieved. Several of the recommendations deal with matters of some complexity and the Government has these matters under further consideration at present. The Government is currently considering these recommendations and specific decisions will be announced in the normal way. (ii) The Darling Harbour Fiasco-`No Port in a Storm' (Tabled 27.11.85) The Minister for Land Transport and Infrastructure Support expects to be in a position to respond to the Committee's report this Sittings. (iii) Inquiry into Civil Coastal Surveillance Co-ordination-`Footprints in the Sand' (Tabled 3.6.86) The Government tabled a response to this Report in the House on 27 May 1987. (iv) Inquiry into Meteorological Services-`Gone with the Winds' (Tabled 3.6.86) The Committee made a number of findings and recommendations on the status of certain Weather Service Offices and their effects on aviation which has required considerable consultation between a number of departments. New working arrangements between the Bureau of Meteorology and the Department of Aviation (now Transport and Communications) were endorsed by the Ministers for Science and Aviation on 5 May 1987. Consultation between Departments on other aspects of the response is continuing. (v) Inquiry into Commonwealth Assistance to the Arts-`Patronage Power and the Muse' (Tabled 18.9.86) The then Minister for Arts, Heritage and Environment tabled a response to this Report in the House on 28 May 1987. (vi) Inquiry into Telecom's Zonal and Charging Policies in Rural and Remote Areas-`Poles Apart' (Tabled 10.11.86) The then Minister for Communications made an interim statement regarding the Committee's Report on 1 May 1987. The Minister for Transport and Communications expects to table the final response to the report following consideration of the views of the Australian Telecommunications Commission. (vii) `Efficient Organisation, or, an Efficient Audit?' (Tabled 23.3.87) The Minister for Administrative Services expects to table a response to the Report this sitting. Procedure (i) Days and Hours of Sitting and the Effective Use of the Time of the House (Tabled 29.5.86) The Government's response to the Committee's Report was presented to the House on 15 September 1987. (ii) The Standing Orders and Practices which Govern the Conduct of Question Time (Tabled 27.11.86) A draft response has been forwarded to the newly constituted Procedure Committee for the purpose of discussion between the Leader of the House and the Committee. Transport Safety (i) Sports Aviation Safety (Tabled 24.2.87) The Minister for Land Transport and Infrastructure Support expects to be in a position to table the Government's response to the Committee's report in this Sittings. HOUSE OF REPRESENTATIVES SELECT COMMITTEES Aboriginal Education (i) Aboriginal Education (Tabled 26.11.85) Initial delays occurred while the Government considered its responses to the recommendations of the Report of the Committee of Review of Aboriginal Employment and Training and the rationalisation of youth allowance schemes, which overlapped to some extent with the Report of the Select Committee. As the report raised matters of direct relevance to State and Territory Governments, some delay arose out of the need to consult with these Governments. All State responses have been received and the Minister for Aboriginal Affairs is finalising a response taking into account the Aboriginal Employment Development Policy announced in August 1986 for the Government's consideration. Aircraft Noise (i) Aircraft Operations and the Australian Community (Tabled 28.11.85) The Minister for Land Transport and Infrastructure Support expects to be in a position to table the Government's response to the Committee's report in this Sittings. JOINT STANDING COMMITTEES Australian Capital Territory (i) Hospitality in the A.C.T. (Tabled 25.11.86) The Government's response to the Committee's Report was presented to the House on 14 May 1987. Broadcasting of Parliamentary Proceedings (i) Inquiry into Television and Radio Broadcasting of Both Houses of Parliament and Their Committees (Tabled 4.6.86) The Government expects to be in a position to provide an interim response to the Committee's report this Sittings. (ii) Provision of Sound and Vision Services in the New Parliament House (Tabled 14.5.87) The Government expects to be in a position to provide an interim response to the Committee's report this Sittings. Foreign Affairs and Defence (i) Australia and the Philippines (Tabled 20.11.86) The Minister for Foreign Affairs expects to be in a position to respond to the Committee's report this Sittings. (ii) Disarmament and Arms Control in the Nuclear Age (Tabled 25.11.86) The Minister for Foreign Affairs informed the Parliament on 17 March 1987 that it had not been possible to respond to the report within the 3 month period, referring to the extensive nature of the report and the importance of the issues it addressed. The Minister expects to be able to provide a final response this Sittings. (iii) A Visit to Papua New Guinea (Tabled 27.11.86) The Committee's Report was substantially a report on a visit by a delegation of the Committee to Papua New Guinea. The sole recommendation of the Report concerned future Parliamentary delegations-a matter for the Parliament to consider. Publications (i) Review of the Cost and Distribution of the Parliamentary Paper Series (Tabled 26.11.86) The Government has considered the Committee's report and has taken measures to implement a number of the recommendations. Mr YOUNG —I move: That the House take note of the paper. Debate (on motion by Mr Fife) adjourned. Mr KEATING(Blaxland-Treasurer) —Pursuant to section 14 of the Income Tax Assessment Act 1936 and section 140 of the Tax Administration Act 1953 and corresponding provisions of the general taxing statute of Australia, I present the annual report of the Commissioner of Taxation for 1986-87. Motion (by Mr Young) proposed: That the House take note of the paper. Debate (on motion by Mr Fife) adjourned. Mr YOUNG(Port Adelaide-Minister for Immigration, Local Government and Ethnic Affairs) —Pursuant to section 83 of the Merit Protection (Australian Government Employees) Act 1984, I present the annual report of the Merit Protection Review Agency for 1985-86. Mr HAND(Melbourne-Minister for Aboriginal Affairs) —Pursuant to sub-section 25 (8) of the Public Service Act 1922, I present the annual report of the Department of Aboriginal Affairs for 1986-87. Mr HAWKE(Wills-Prime Minister) —by leave-I wish to report to the Parliament on the visit I paid to New Zealand from 19 to 23 November. As I said at the state luncheon hosted by Prime Minister David Lange in Wellington on 20 November, Australia and New Zealand have a unique relationship. We are next door neighbours. We share long historical ties and deep liberal democratic traditions. Australians and New Zealanders have fought together in two world wars, we have co-operated and collaborated in time of peace and we are, enduringly, the closest of friends. The strength of the relationship consists of much more than connections between the two governments and its vitality resides in the daily exchanges between our peoples across the widest range of business, family, sporting, cultural and political activities. My visit in every way reflected this special warmth, openness and friendship. My extensive discussions with Prime Minister Lange and his Ministers over four days were characterised by these qualities. But while good will abounded this was not merely a symbolic and good will visit. It was also a very business-like one concerned with the further development of Australia-New Zealand relations. While the close ties established in the past formed the backdrop for my talks, their focus was on the contemporary scene and on how we might co-operate more closely in the future. It serves the interest of neither country for us to regard the relationship as fixed in time and bound by the limits of the past. The relationship must remain relevant to current needs and have flexibility to adapt to changing circumstances. For a start, the political and economic situation in the South Pacific, a region of direct and immediate interest to both countries, is not immutable. Indeed, as I said to Mr Lange in our discussion of foreign policy topics, the region is somewhat more troubled that it was five or 10 years ago. I stress that this is by no means an alarmist comment. The overall situation in the South Pacific continues to be one of stability and the relationship between Australia and New Zealand and our friends in the region remains extremely close and friendly. But clearly some significant new difficulties have emerged. We discussed the situation in Fiji and found a close proximity of views. This was true in respect of both the analysis of the situation and our policies in response to it. Australia and New Zealand both deplore the overturning of civilian democratic government by the military in Fiji. We are acutely conscious of the disruptive impact which this has had on the political fabric of Fiji, its economic circumstances and prospects and Fiji's international standing. We each take the view that our friendship for the people of Fiji is undiminished and we each have a strong interest in the restoration in Fiji of political and constitutional arrangements, achieved by the people of Fiji themselves, which will provide for political stability, social harmony, economic recovery and human rights. We will each be taking a close interest in the situation as it evolves. Mr Lange and I agreed that the position taken by the South Pacific Forum at its meeting in Apia, and more recently by the Commonwealth Heads of Government Meeting in Vancouver, constituted a realistic approach to the Fiji problem and one which clearly enjoys widespread international support. I expressed to Mr Lange my very deep appreciation for the way in which we had been able to work closely and actively together at these important meetings. We shall continue to do so. Another regional problem which, as Mr Lange said, has sent ripples through the region is New Caledonia. Australia's wish remains to help ensure that a long term, viable, peaceful political solution can be found to the problems of New Caledonia. We do not seek to confront France over New Caledonia or to drive it from the South Pacific region. Such suggestions are completely without foundation. Our concern is to encourage France to engage all the people of New Caledonia, including the Kanaks, in a genuine process of deciding future arrangements for New Caledonia. Like New Zealand and other South Pacific Forum countries, we wish France to follow the well-established decolonisation procedures of the United Nations in arranging an authentic process of self-determination in the Territory. And, as I said in Wellington, the changes we seek are, whatever may be said in some quarters, designed to achieve precisely the stability which is vital to Australia, New Zealand and the region as a whole. The consultations on foreign policy during my visit extended beyond such immediate regional issues to a range of other matters. We talked about positive developments in the Asia-Pacific region, particularly noting the remarkable growth performance of many countries in the Pacific Rim. There is a concurrence of view that Australia and New Zealand are not only geographically a part of this region but that our economies must increasingly draw their vitality from the region. We discussed the importance of the course on which China has embarked, reaffirmed at the recent Party Congress, towards economic modernisation and the continuation of openings to other countries. We each welcomed the direction China has taken and attach the highest importance to it. The effort my own Government has made to develop the extremely close relationship with China which Australia now enjoys has already brought very significant benefits. We discussed, too, the situation in the Philippines where our two countries each firmly support the Government of President Aquino. Our discussions covered the changes taking place in the Soviet Union, which I will shortly have the opportunity to assess first hand during my visit to that country. Prime Minister Lange and I were at one in commending the improvement which has taken place in East-West relations and, in particular, the importance of the impending agreement between the United States and the Soviet Union for the elimination of intermediate nuclear weapons. We hope that this will provide impetus for progress in the area of strategic nuclear weapons and other fields of disarmament and arms control. As I said in Wellington, Australia and New Zealand have worked together in the cause of disarmament and my Government has valued co-operation with New Zealand in the search for a comprehensive test ban agreement and in the conclusion of the South Pacific Nuclear Free Zone Treaty, a significant and creative regional arms control arrangement by the countries of the South Pacific Forum. Notwithstanding all these areas in which my discussions again showed that Australia and New Zealand hold such close views, our positions do not always coincide. We are sovereign, independent countries; as Mr Lange put it, one Australasian family we may be, we are nevertheless two nations. Moreover, it is exactly because of the extremely close friendship between the two countries to which I earlier referred that we owe it to each other to speak plainly when there is a significant policy difference. As all honourable members know, there is a serious difference between the Australian and New Zealand governments over the issue of access of allied warships to our ports. My visit in no way sought to disguise this difference or sweep it under the carpet. I reaffirmed clearly, both in my private talks and publicly in New Zealand, that Australia adheres firmly to our policy on welcoming ship visits by our United States ally. We accept the need for strategic deterrence. Australia will not resile from its firm support for the Western Alliance, with the corollary that the global nuclear balance can be maintained only through a credible United States nuclear deterrent. We believe that, although a nuclear balance of power is not an ideal state of affairs, it does exist and it has maintained world peace. We consider that a realistic policy is to recognise this while, at the same time, encouraging balanced reductions in nuclear forces which maintain the credibility of the deterrent at the lowest possible level. We believe too that part of Australia's contribution to the Western Alliance system is to allow access to ports and airfields in Australia by the United States. We continue firmly to believe that such access is essential to the full effectiveness of the ANZUS alliance. Clearly New Zealand takes a different view and this disagreement is not therefore in any sense behind us. But I believe that it is a sign of the maturity of our relationship that we can have this important disagreement without allowing it to corrode our overall friendship. This includes the area of bilateral defence relations where Australia, New Zealand and indeed the United States regard it as important that co-operation and collaboration continue. My Government's approach to Australia's defence relationship with New Zealand continues to be governed by the basic importance of the defence relationship to the security of Australia and New Zealand alike, as acknowledged in the White Papers published by both governments in 1987. The ability of Australian and New Zealand forces to operate together, and to support and sustain each other, adds significantly to the joint defence capability of the two countries. What this means in practical terms is that my Government has sought to consolidate the defence relationship in well defined activities such as training, co-operative procurement, combined exercises, ship visits and effective consultations on the South West Pacific and other regional interests. I wish in particular to mention here the Anzac ship project, to construct the new surface combatant ships, which represents a milestone in Australia-New Zealand defence co-operation. This project will promote inter-operability between our navies and make a major contribution to our strategic needs. For New Zealand's part, Mr Lange noted that our common security interests are indeed extensive. He signified that New Zealand valued its defence alliance with Australia. He, too, noted the practical value of combining our efforts in such areas as procurement. He correctly said that there is a solid pragmatic basis for our commitment to each other. My discussions in New Zealand also covered the challenges facing our respective economies and the management of them. Our situations differ in important respects and our policies are not, of course, identical. But it was valuable to compare experiences and approaches and, moreover, we do have two important things in common. First, both New Zealand and Australia are engaged in the task of economic restructuring. We recognise that this is the only route by which our nations can ensure their prosperity and growth in the contemporary world economy. Secondly, both my Government and the New Zealand Government accept that restructuring involves decisions which are seldom easy or comfortable. It requires economic management which is realistic, credible and resolute. I need not leave it unsaid that my visit to New Zealand was, to some extent, a fraternal visit. The Labor parties on both sides of the Tasman have this year achieved historic re-elections. And it is noteworthy that in the task of economic restructuring and economic management both countries are being led through the present very testing economic circumstances by Labor governments committed to policies which are realistic and creative. I do not doubt from my discussions the determination of the New Zealand Government to confront the problems facing the New Zealand economy and I wish Mr Lange and his colleagues well. Given the importance of the trans-Tasman economic connection and its potential to become still more important, the growth and development to both economies is clearly and very strongly in our mutual interests; not just in the interests of the citizens of Australia and New Zealand considered separately. Mr Lange rightly described the closer economic relations (CER) agreement as a central strand in the fabric of our relationship. I am happy to pay tribute here, as I did in New Zealand, to the hard work and imagination of our predecessors in government in developing the CER. It is an initiative which the present governments both in Australia and New Zealand fully endorse. Progress under CER has without question exceeded expectations. It is the most comprehensive bilateral agreement entered into by either country in the trade field. Its success is indicated by the extent of the increase in two-way trade, from $1.8 billion in 1982-83 to $3.2 billion in 1986-87. This has been a function of the strides made in reducing or eliminating barriers to trade, often far in advance of the timetable set out in the agreement. For example, tariffs on most goods have been removed and duty-free trade has increased remarkably from 75 per cent to 92 per cent of total trans-Tasman trade in the course of the agreement. In addition, trade which is free of quantitative import restrictions has increased since the agreement commenced in 1983. Pleasing progress has been made in eliminating export subsidies and incentives on goods traded between Australia and New Zealand and in the work that has been done on harmonisation of standards in relation to such areas as food, industrial products and industrial property legislation. However, the value of CER to Australia has gone beyond just the quantitative impact on our bilateral trade. For many, exporting to New Zealand has been the first experience with the export market and has provided an invaluable opportunity to develop an export culture. And indeed, it is that recognition of the wider benefits of CER that has informed our joint approach to the review of CER which will take place in 1988. My discussions with Mr Lange and his Ministers have set the agenda for the detailed discussions which will now get under way. We agreed that a new chapter should be opened in the economic relationship, one in which we advance the economic relationship more rapidly and on a more comprehensive basis. In setting the agenda for the CER review, Mr Lange and I agreed on three areas for consideration. First, the two governments will examine the scope for bringing forward to the early 1990s the implementation of free trade in goods across the Tasman, previously scheduled for completion in 1995. Secondly, our governments will explore the extension of CER beyond trade in goods to the growing area of trade in services. Thirdly, we are ready to consider the extension of CER to regulatory policies and practices outside the present provisions of CER, which bear on trade and investment. Officials will begin discussions early in the New Year, ahead of a meeting of Ministers around June. Mr Lange and I intend to meet and compare notes on progress made in August or shortly thereafter. Our intention is to approach the Review positively to get a framework, objectives and time scale for implementation of decisions which will significantly deepen and widen the economic relationship across the Tasman over the next five years. This task is one which the business communities of both countries have called on us to undertake. The aim, as I said earlier, is not just to boost bilateral trade. It is to help to prepare each of our countries to compete on world markets, especially those of our region. The New Zealand Government, like the Australian Government, is acutely conscious of the fact that whatever progress we make in bilateral trade relations there is no substitute for liberalisation of international trade on a global basis. This is a fundamental interest which we share and for which we will continue to work together internationally. Mr Lange and I recognised the value of the Cairns group of fair traders as a much needed third force in the Uruguay round of trade negotiations. As efficient agricultural exporters, Australia and New Zealand have been hard hit by the distortion and disruption of international trade in agricultural products. We are determined to exert our influence to move the Uruguay round ahead in an effort to bring down protectionist barriers and reverse the corruption of international trade in agricultural products. Mr Lange described this as `an identity of interest' and I agree. The closeness of relations between Australia and New Zealand will find very special expression next year through New Zealand's generous contribution to our bicentennial celebrations. New Zealand has responded enthusiastically to our invitation to join us in this celebration and the New Zealand-Australia Bicentennial Committee has developed a fine program of projects in both countries in 1988. I am particularly grateful that New Zealand has chosen to mark the Bicentenary by restoring and presenting to Australia the historic yacht Akarana, an inspired contribution to the Australian National Maritime Museum in Sydney which will, I am sure, be one of the institution's most popular attractions. The visit of Mr Lange to Australia in 1988 will be most welcome as a symbol of the closeness of Australia-New Zealand relations. I am sure I speak for all honourable members in reiterating here the thanks which I expressed to Mr Lange and through him to the people of New Zealand for the contribution New Zealand will make in 1988. The point I wish to make, however, is that long after 1988 has passed, Australia and New Zealand will enjoy a deep closeness and affinity. It is not a relationship for one particular year, but an abiding relationship. It is not a relationship of mutual interest in one particular sector of activity, but a relationship of closeness across an extraordinarily wide range. My visit to New Zealand fully reflected and confirmed this fact. It leaves me not merely with a sense of deep satisfaction about what Australia and New Zealand are already doing together but also with a sense of great optimism about what we will yet do together in the future. Mr HOWARD(Bennelong-Leader of the Opposition) —by leave-The Opposition welcomes the statement which has been made by the Prime Minister (Mr Hawke). There is much in the Prime Minister's speech that will find bipartisan support in this Parliament. The relationship between Australia and New Zealand is very deep and is strongly supported by both sides of this Parliament and both sides of politics in Australia. The Liberal and National parties welcome the review of the closer economic relations (CER) announced by the Prime Minister and the New Zealand Prime Minister, Mr Lange. It is appropriate, as the Prime Minister acknowledged, to recognise the contribution that was made by the former coalition Government in bringing CER about. CER will stand as a permanent monument to the former Deputy Prime Minister of Australia, Doug Anthony, who, more than any other politician in recent Australian political history, sought to lay a practical as well as a sentimental and emotional basis for the relationship between Australia and New Zealand. Therefore, we in the Liberal and National parties are happy to join the Prime Minister and the Australian Labor Party in welcoming this review. One would have to have a very shortsighted attitude towards the future of Australia and New Zealand to pretend that our joint interests do not lie in removing any remaining barriers that exist between our two countries. To the extent that the review of the closer economic relations agreement can bring about a dissolution of those barriers it is a development which honourable members on both sides of this House should welcome. However, I sound a note of caution that in the process of bringing about this review it is incumbent on both governments to ensure that there is total and adequate consultation with representatives of Australian industry, that there is a keen appreciation of the impact on some of the more struggling primary industries in Australia which may be affected by CER and that those changes should be brought about. There are only two other matters I want to mention. The first matter relates to what I detected as a complacent note in the Prime Minister's speech regarding the overall situation in the South Pacific. The Prime Minister said: The overall situation in the South Pacific continues to be one of stability and the relationship between Australia and New Zealand and our friends in the region remains extremely close and friendly. I put it to the House that that is the kind of statement that could have been made by this Government six or nine months ago when we thought democracy still reigned in Fiji. It is the kind of statement that could have been made to this Parliament by the Minister for Defence (Mr Beazley) when he initially embraced the recommendations of the Dibb Review of Australia's Defence Capabilities. It is the kind of statement that could have been made to this Parliament before the Prime Minister and his Government recognised the extent to which Libya was up to no good as far as our interests were concerned in the South Pacific. I say again, notwithstanding my wish to sound, as far as possible, a bipartisan note on matters affecting the relationship with New Zealand, that the Prime Minister again evinces a note of complacency about the atmosphere as it prevails in the South Pacific. It will be no secret or surprise to this Parliament for the Liberal and National parties to say to you, Mr Deputy Speaker, that we share none of the enthusiasm for the South Pacific Nuclear Free Zone Treaty to which Australia is an adherent. We do not share the rather misty-eyed view of the Government about the value of this Treaty. We note that, in a sweeping review of the stability of the region and a reference to changes in the Soviet Union and attitudes towards China, there is no reference at all to the military significance of the Soviet presence in Cam Ranh Bay. How can a Prime Minister of Australia report to this Parliament about the state of stability in this part of the world without making any reference to that? I was pleased to hear his reference to the stability and viability of the Government in the Philippines. I hope that, within the bowels of those sections of the Government that are advising the Prime Minister on these matters, there is a contingency plan available about the strategic position of the Western alliance in this part of the world if events in the Philippines do not move in the direction we would like them to move. Although I welcome the reaffirmation of the importance of the Western alliance and of the United States deterrent in the Prime Minister's remarks, I repeat the criticisms that were made by my predecessor, the present Deputy Leader of the Opposition, the honourable member for Kooyong (Mr Peacock), and by the Leader of the National Party, the right honourable member for New England (Mr Sinclair), at the time of the crisis in relations between New Zealand and the United States. We on this side of the House do not believe that the Hawke Government did nearly enough to dissuade the Lange Government from breaking the ANZUS Treaty. It remains one of the very serious strikes against this Government that insufficient was done at that time. In conclusion, the Opposition welcomes any work done by the Government, however belated in terms of the timing of the visit by both the Prime Minister and the Minister for Foreign Affairs and Trade (Mr Hayden), to build relations between Australia and New Zealand. It goes without contradiction that our destinies are linked, not only by history, but by the strategic circumstances in which we find ourselves in this part of the world. The Clerk —Petitions have been lodged for presentation as follows and copies will be referred to the appropriate Ministers: To the Honourable the Speaker and members of the House of Representatives in Parliament assembled. The petition of the undersigned 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 Beale,Mr Jenkins,Mr Kent,Mr Peacock 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 respectfully requests that food irradiation be not introduced as a method of food preservation. It is respectfully suggested in this regard that: Food irradiation has been tested and abandoned in Europe and the USA; Japan does not allow the importation of irradiated foodstuffs; Food irradiation results in a loss of vitamins, an effect which enhances obesity; Nearly all research shows a high degree of uncertainty about the dangerous effects of food irradiation; Food irradiation is not only ineffective against the dangerous bacterial toxins, it also represents a further consumer expense and can produce in food colour changes and undesirable odours and flavours. by Mr Simmons. To The Speaker and members of the House of Representatives in Parliament assembled, your humble petitioners showeth: 1. The proposed Australia Card will have a dramatic impact on the lives of all Australians. 2. Therefore your petitioners request a national referendum on the Australia Card Bill before the proposal is re-submitted to Parliament. As in duty bound your petitioners will ever pray. by Mr Beale,Mr Dobie,Mr Rocher and Mr Ruddock. To the Honourable the Speaker and members of the House of Representatives in Parliament assembled. The petition of the undersigned expresses concern that some scientists in Australia are intent on undertaking destructive experimentation on human embryos. This subject was examined exhaustively by the 1985-86 Senate Select Committee on Senator Harradine's Human Embryo Experimentation Bill which received 270 submissions and more than 2,000 pages of evidence. The report of the Senate Committee recommended in October 1986 that the Commonwealth Government make unlawful any destructive experiment which frustrated the development of the human embryo. Your petitioners therefore request the House of Representatives and the Government of the Commonwealth of Australia to: Implement without delay the major recommendation of the Senate Select Committee to outlaw destructive experimentations on human embryos. And your petitioners, as in duty bound, will ever pray. by Mrs Darling and Mr Shack. To the Honourable the Speaker, and members of the House of Representatives of the Parliament of Australia assembled. We, the undersigned, being appalled that the Government has set no penalty for the possession of child pornography, and has set no penalty for importing unclassified child pornography, do ask that Parliament urgently legislate to: make the importation of child pornography, and the possession of child pornography, and all tapes and goods banned by Customs, to be a criminal offence, with deterrent penalties, and close the Customs barriers to pornography in the A.C.T., in respect of X-rated videos, (and ER) and end the shameful Canberra trade, and the Mafia Connections. Because 98% of Australians in other States have banned X rated videos. Because the trade is still flourishing, and it's availability escalates sexual crime. Because importers of child pornography face only a fine for lying. Because child pornography pedlars are safe if they cross a border, and cannot be extradited for summary offence. Because anyone can have these tapes in their possession for private use. Because the Government does not intervene in that. 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 Rocher and Mr Shack. To the Honourable the Speaker and Members of Parliament assembled. We the undersigned citizens, respectfully showeth: 1. That we are totally opposed to the Government's discriminatory Anti-Smoking legislation in the workplace bans and on Domestic Airline travel. 2. Note that so called Environmental Tobacco smoke has not been proved as a major pollutant either in the workplace or on aircraft. 3. This legislation will discriminate against thirty per cent of the citizens of Australia, and 4. Call upon the Government to lift all bans and not proceed with any discriminatory smoking legislation. And your petitioners as in duty bound will ever pray. by Mr Beale. To the Honourable Speaker and members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully shows: We are concerned that- (a) the proposed changes in legislation to Unemployment Benefit for young people adds to the already ill-conceived and over-bureaucratic welfare system and (b) the abolition of CEP and the inadequacy of other training programs and (c) cuts in funding for education, public housing and other welfare areas mean that young people's needs are being neglected by the Government. Your petitioners therefore pray that-the Commonwealth Government immediately takes steps to (a) establish an anti-poverty level of income for all young people regardless of whether they are in training, retraining, education, employment or unemployment. The first step in achieving this is the full reinstatement of Unemployment Benefit for sixteen and seventeen year olds with automatic indexation linked to CPI increases. (b) increase educational opportunities for all young people. The first step in achieving this would be to create 120 000 new places in higher and further education. This would make up for the 100 000 people turned away from TAFE courses and 20 000 people from universities and CAEs this year. (c) establish a long term job creation program. The creation of 53 100 jobs for those young people who have been unemployed over 12 months is required immediately. Your petitioners 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 certain citizens of Australia shows- We, the undersigned citizens, object to the proposal of Telecom to charge for each three minutes of a local call, as we feel this would disadvantage the elderly and people who are unable to leave their homes. The telephone is sometimes the only contact relatives can have to check on the safety and well-being of those they care for. Also, when making business calls, you are quite often asked to hold the line or are transferred from one Department to another and this all takes time. We sincerely feel that the charges Telecom makes at the moment are quite adequate. Your petitioners therefore pray that Telecom will not introduce a time charge on local telephone calls. by Mrs Darling. 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 the Post Office at Gymea Bay be closed. The Post Office serves a community need and we would be seriously inconvenienced by having to travel to another centre for our postal requirements, or even to collect registered letters and parcels, cash Pension cheques and transact banking. Many of us are Pensioners and the cost of such travel would be an unnecessary imposition. The nearest Post Office is 2.3 kms away with no convenient transport. We maintain that the purpose of the Post Offices should be to serve the public for the variety of services they offer, and that they should not be closed merely to save money or help Australia Post make a profit. Your petitioners therefore humbly pray that the House should take all possible steps to prevent the closure of Gymea Bay Post Office. And your petitioners as in duty bound will ever pray. by Mr Dobie. To the Speaker and the Members of the House of Representatives in the Parliament assembled: The petition of certain citizens respectfully showeth: The Hawke Labor Government's ID Card proposal is the most far reaching and intrusive piece of Australian legislation yet introduced, and that on all the evidence available, it will not tackle tax and social security fraud in the most cost-efficient and effective manner. Your petitioners humbly pray that the House of Representatives, in Parliament assembled, urge the Government to: Reject Labor's ID Card proposal to prevent a gross waste of taxpayers' money and a significant infringement of civil liberties. And your petitioners as in duty bound will ever pray. by Dr Harry Edwards. The Honourable the Speaker and Members of the House of Representatives of the Commonwealth of Australia in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth concern: About the evil caused by the fact that x-rated videos with their depiction of unnatural sex and often horrible violence, are allowed to circulate around Australia from Canberra. And your Petitioners, therefore humbly pray that such circulation be prevented. The laws regarding obscenity in the media should also be revived and enforced. And your Petitioners, as in duty bound, will ever pray. by Mr Jull. To the Honourable Speaker and Members of the House of Representatives in Parliament assembled. Your petitioners respectfully showeth: That the introduction of an Identity Card, to be called the Australia Card, and a National Identification Numbering System, is not in keeping with the established rights, privileges and customs of the Australian people: It is, therefore, the will and desire of the said petitioners that the proposed legislation be neither introduced in its original form, nor amended in any way, but totally withdrawn. And your petitioners, as in duty bound, will ever pray. by Mr McVeigh. 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 we oppose plans by Telecom Australia to close many of the Telecom Business Offices (TBOs) and replace them with a reduced service to be co-located with the District Customer Services Office. We believe the public should be able to make telephone bill payments, applications for new services, selection of telephones and complaints, in person at a convenient and easily accessible location. Telecom Business Offices provide this service, and therefore it is wrong that their contribution and performance will only be assessed on their sales revenue. Your petitioners humbly pray that the House of Representatives, in Parliament assembled, urge the Government to: instruct the management of Telecom Australia to immediately cease all action to close any Telecom Business Offices. And your petitioners as in duty bound will ever pray. by Mr O'Neil. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. We, the undersigned citizens, respectfully showeth: That we are totally opposed to the introduction of the Labor Government's Identity Card; That this form of national and compulsory identification will be intrusive, costly for taxpayers and business and will not be effective in combating tax evasion, illegal immigration or social security fraud; That we are deeply concerned at the Labor Government's inability to provide effective and efficient methods to combat tax evasion and social security fraud without resorting to expensive, ineffective and authoritarian measures which are alien to the Australian way of life; That we call upon the Labor Government to improve management systems within the Australian Tax Office and other Departments to crack down on tax evasion and fraudulent practices. And your petitioners as in duty bound will ever pray. by Mr Porter. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth that: 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 in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth that: 1. The decision by the Australian Broadcasting Corporation not to televise the Jack High Bowling Tournament in 1988 is cause for distress to the 500,000 bowlers and many non bowlers who, for years, have enjoyed this interesting programme on television. 2. The unilateral decision was taken after verbal assurances had been given that the 1988 event would be televised. This action is deplored and we feel should be reversed by the parliament in the interests of your many constituents. by Mr Rocher. To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of certain citizens of Australia respectfully showeth: The Government by persisting with the Australia Card Bill has wilfully rejected the advice and recommendations of the Parliament of the Commonwealth of Australia's ``Joint Select Committee on an Australia Card'' which unequivocally rejected the Government's proposal in these words: ``The majority believes the creation of a new bureaucracy of 2000 public servants within the HIC [Health Insurance Commission], with the sole task of identifying every man, woman and child in Australia, is a wasteful exercise which will not address the problems of tax evasion and social security fraud but will provide the mechanism by which the very fabric of our society will be irreversibly altered, opening the way for the greatest attack on the privacy of individuals as the `Identity Bureau' identifies, monitors and updates information on every person in Australia.'' (Report, 4.55, page 148) Your petitioners therefore humbly pray that the Government now withdraw the Bill as being contrary to the Common Law and traditional freedoms we have hitherto enjoyed in Australia, and should the Bill be nevertheless re-introduced, that the Members of the House without regard for party should unanimously reject the Australia Card Bill as being contrary to our personal liberties and the national interest. 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 in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth that: Any proposals to abolish the Department of Veterans' Affairs gravely concern ex-servicemen, ex-servicewomen and their families, because they renege on clear and unequivocal commitments from various Commonwealth Governments to properly care for Australia's Veterans. Your petitioners humbly pray that the House of Representatives in Parliament assembled, urge the Parliament to: Ensure that the Department of Veterans' Affairs continues to exist as a separate and distinct Department of State servicing the needs of Veterans and their families. And your petitioners, as in duty bound, will ever pray. by Mr Ruddock. To the Honourable the Speaker and the Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Richmond electorate respectfully showeth that: 1. We the undersigned are totally opposed to the introduction of a $2.00 fee on prescription drugs for pensioners; 2. 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 humbly pray that the House of Representatives, in Parliament assembled, urge the Government 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 Blunt. Petitions received. Mr DEPUTY SPEAKER(Mr Mountford) —The Acting 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 urgent need for the Government to privatise some publicly owned enterprises to make them more efficient and effective and thus benefit consumers, taxpayers and the employees of the enterprises themselves. 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)(3.24) —One of the best known statements of the English language is: `As ye sow, so shall ye reap'; and if ever a statement were a candidate to be the epitaph of the Prime Minister (Mr Hawke) on privatisation, it will be that one when the Centre Left and the Left of the Australian Labor Party finally bury the Prime Minister at the national conference of the Labor Party on this particular subject. The Labor Party is convulsed in a fight over privatisation. We have the humiliating spectacle of the Prime Minister of this country twice in one evening pleading with the self-identified Centre Left of his Party to save him from humiliation at the hands of his Caucus this morning on the issue of privatisation. The Prime Minister is pleading with them to exercise a bit of economic common sense. He is pleading with them to recognise that the national need requires the Labor Party to reverse its historic opposition to privatisation. Why is he finding it so difficult? Why does the Prime Minister have to address the Centre Left twice? Why does he have to plead with his Party to change its attitude? It is because he and nobody else has taught the Labor Party the dangerous nonsense that its Centre Left and Left are now mouthing. The Prime Minister is pleading with his Party for a rational debate on privatisation and he is not getting that rational debate. The Prime Minister had to be saved last night by the casting vote of Senator Peter Cook. Fancy that! The Prime Minister of this country had to be saved from the humiliation of being publicly deprivatised by none other than Senator Cook, the leader of the Centre Left, who has not forgotten, incidentally, that the Prime Minister did him out of a Ministry in the reshuffle that went on immediately after the last Federal election. The reason why the Prime Minister is making such heavy going of it, the reason why he had to send his mate from Melbourne, Senator Gareth Evans, along to that privatisation conference last week and get him to spell out in clear terms the economic case for privatising bodies such as Qantas Airways Ltd and Australian Airlines is that the Prime Minister himself, more than anybody else, was guilty of leading a shrill, reckless and dishonest campaign in this country against the principle of privatisation. Every single time the Prime Minister gets up in this Parliament or gets up on to a public platform anywhere in Australia, he pleads with his Party and the Australian people for a reasoned, sensible and rational debate. Honourable members heard him again at Question Time today saying, `What we do on this side of the House is to have a reasoned, sensible debate'. The Labor Party was not having a reasoned, sensible debate in May 1985 when the Treasurer (Mr Keating) said: No matter where one looks, whether it be at TAA or the other authorities, there is no case for the Opposition's argument in economics, except simply to indulge ideologically in a Thatcherite, vandalistic splurge to try and destroy these authorities. That was the Treasurer. The Prime Minister waxed even more lyrical on the subject when he addressed the Ben Chifley memorial inaugural lecture at Bathurst in September 1985. What the Prime Minister had to say then bears very interesting reading against the arguments that are now being advanced by the members of the Left and Centre Left of the Party. What those people are now doing-what Senator Bolkus is doing, what Senator Childs is doing, what the honourable member for Aston (Mr Saunderson) is doing and what, no doubt, in Cabinet the Minister for Aboriginal Affairs (Mr Hand) is doing-is flinging back in Bob Hawke's teeth the very argument that he so emotionally used against the Liberal and National parties less than one year ago. This is what the Prime Minister had to say in the Chifley memorial lecture: What in the name of reason is the justification for breaking up and selling off the great and efficient national assets, like the Commonwealth Bank, Telecom, TAA and Qantas. But as the people of Australia come to realise the extent of the economic and social vandalism proposed by our opponents-and indeed as part of the process of promoting that awareness-it will be necessary for us-Ben Chifley's heirs and successors-to keep fresh and green the memory, the example and the experience of this great Australian. In other words, it is the left wing and, to some extent, the Centre Left of the Labor Party that are still following the Prime Minister towards what they see as `the light on the hill' of preserving public ownership of these bodies. If at the end of this long process, as I believe, the Prime Minister is defeated, and his colleagues are defeated, he will have nobody to blame but himself. It is he who sowed the seeds of prejudiced argument; it is he who flung rhetoric around like confetti; it is he who misled and deceived the Australian people about the privatisation policies, their meaning and their intent when they were advanced by the Liberal and National parties over the last two or three years. The arguments for privatisation in Australia in 1987 are quite overwhelming. They have been significant and substantial arguments for some time but the case for privatisation grows stronger every month. Let me go through the arguments in favour of privatisation. Let us put to one side the nonsense that the Prime Minister peddles that the commitment of honourable members on this side of the House to privatisation is some kind of ideological binge. We have never said that we should privatise for its own sake. We have always said that we sell a public asset only if there is a clear public benefit in doing so. We have always said that we have to run the test of public and consumer benefit over the proposed sale before making an affirmative decision. Does anybody seriously argue in Australia now that the public interest would not be served by the sale of Australian Airlines? Does anybody seriously imagine that we can rationally complete the deregulation of the Australian airlines industry without passing Australian Airlines from public into private ownership? The only way we can provide the voracious capital needs of Australian Airlines in the future is to privatise it. There is no other way, unless we are prepared to stand up to the Australian people and say, `We will not reduce your taxes. We will not provide essential social services. In other words, we will give priority over and above reducing the taxpayers' burden in this country to providing injections of public money into the capital of bodies such as Australian Airlines'. The argument does not stop at Australian Airlines; it runs on to bodies such as Qantas Airways Ltd, Aussat Pty Ltd, and so the list goes on. Let me take the opportunity of saying to the House that we in the Liberal and National parties are committed to a policy of privatisation which is based upon the principle of first inquiring whether there would be a public benefit and whether consumers would benefit. Do we believe in minimising political interference in output pricing and investment decisions? Do we believe in giving management the freedom to manage? Do we believe in improving the operational efficiency of these bodies? Do we want to make them open? Do we want to put into their hands the range of capital funding services that are available to private companies operating commercially? Let us remember the enormous budgetary problem that is looming if this Government does not undertake a policy of major privatisation. Over the next few years alone there will be demands of $1 billion to $2 billion on the Budget of this country unless bodies such as Qantas and Australian Airlines are privatised. If honourable members do not take my word on that matter, they should take the word of Senator Gareth Evans. This matter was self-evident 12 months ago; it was self-evident 18 months ago. The criminal blame in this argument lies with the Prime Minister for having poisoned the debate for so long that we have lost two or three years in gearing up for privatisation. We will now have to wait almost another year before the Australian Labor Party finally makes up its mind. If the Labor Party decides to go down the path of privatisation, history will record that it wasted two to three years in making up its mind on this very important issue. The advantages of privatisation are to be found not only in the fact that privatisation removes the call on Budgets for injections of large amounts of capital. The advantage of privatisation, as has been demonstrated in other countries-and will, no doubt, be demonstrated in Australia if this Government has the political and economic courage to embark upon such a policy-is that the greater competition it brings about benefits consumers of services that are provided by the privatised body. It is only through exposing so many of these bodies to the rigors of the market-place and to competition that greater benefits for Australian consumers will ensue. That is why the Liberal and National parties support a policy of privatising Australian Airlines, and of selling at least 49 per cent of Qantas-and we are currently reviewing whether that 49 per cent ought not be extended to 100 per cent. We support the privatisation of domestic airport terminals. We support the privatisation of the Australian Industry Development Corporation, 49 per cent of the Overseas Telecommunications Commission (Australia), 100 per cent of Aussat, and the sale of the Housing Loans Insurance Corporation, the Snowy Mountains Engineering Corporation, Medibank Private and the Australian Pipeline Authority. As my colleague the Deputy Leader of the Liberal Party (Mr Peacock) has announced, we are also undertaking a review of whether we should add to that list the privatisation of whole or part of the Commonwealth Banking Corporation. There is no ambiguity; there is no squeamishness; there is no going to water; there is no backflipping or double standards from the Liberal and National parties on the issue of privatisation. We understand the economic need of the country. We have nailed our colours to the mast and we are saying to the Prime Minister: `Where do you and those who follow you stand on this issue?'. It is pretty clear where the left wing of the Labor Party stands on this issue because after today's Caucus meeting a statement was issued by the Executive of the parliamentary Left and it was signed by 10 left wing members of parliament, including Nick Bolkus, Bruce Childs, Lewis Kent, John Saunderson and former Minister, Arthur Gietzelt. This is what the statement of that terrific 10-- Mr Beale —Where was Gerry? Mr HOWARD —Gerry was there in spirit. Gerry is constrained by his ministerial responsibilities, which he takes very seriously. This is what those 10 had to say: It was an important victory which called on Ministers to prepare proposals which would strengthen and enhance authorities in full public ownership. The statement went on to urge the trade union movement and the Party's rank and file to step up their opposition to privatisation. There is no doubt in the Left's mind what today's Caucus meeting meant. It meant that the Prime Minister has been comprehensively rolled. His Party had thrown him a lifebuoy that was full of holes. He is floundering around and the factions are at war on this issue. The reason they are at war-this should never be forgotten by anybody in this House or any member of the rank and file of the Australian Labor party-is that the Labor Party believed its Prime Minister 12 months ago when he said that privatisation was economic vandalism. He sold them the argument, and now when he gets down on his knees and pleads with them to change their attitude, they are turning deaf ears. They are saying, `Bob, 12 months ago it was economic vandalism. Now you are saying it is economic nirvana. Twelve months ago you said that it would destroy our political faith; you are now saying that it is necessary for the modernisation of the Australian economy. Why should we believe you now when we believed you 12 months ago and you have turned your back on us?'. The Prime Minister's deceit of a year ago has caught up with him. If he loses this argument and Australia is the loser, if our Budget goes back into deficit and we are denied the tax cuts to which we are entitled, he and he alone will carry the blame for that deception. Mr DEPUTY SPEAKER —Order! The Leader of the Opposition's time has expired. I call the Minister for Employment Services and Youth Affairs and Minister Assisting the Treasurer. Mr Carlton —Where is the senior Minister? Why doesn't he come in? Mr HOLDING(Melbourne Ports-Minister for Employment Services and Youth Affairs)(3.39) —The Opposition is entitled to hear senior Ministers when it has senior arguments that are worth answering. This Opposition continually makes a mockery of this House because the reality is that this matter of public importance is a rehash of a privatisation argument that was put by a shadow Minister less than a week ago. We have listened with some interest to the Leader of the Opposition (Mr Howard) telling us that he and the Opposition-let me quote his own words-`understand the economic needs of this country'. Let me repeat that: he understands the economic needs of this country. One does not have to be an economic wizard or whiz kid to realise that what we got from the Leader of the Opposition today was precisely the same arguments that were trotted out to the people of Australia less than four months ago. He does not even have the decency to update them. All that has happened is that his speech writer got to work yesterday before the Caucus meeting--before the Leader of the Opposition knew either the quality or the nature of the debate that took place within the parliamentary Labor Party. The Leader of the Opposition trotted out the same old remedies and the same old arguments. Let me quote back to him his own biblical reference: `As ye sow, so shall ye reap'. Nothing could be truer in respect of this Leader of the Opposition, who showed today that he has not learned a single thing from when he was Treasurer or from the last election. As Treasurer in the discredited Fraser Government, this man who says he understands the economic needs of Australia left a legacy of double digit inflation, double digit unemployment and a prospective Budget deficit of nearly $10 billion. That is the legacy of the gentleman who now parades around this House trying to convince this motley group of backbenchers that he understands the economic needs of Australia. In the July election campaign, just four months ago, he offered the people of Australia a tax bribe of $6 billion. He promised massive unspecified expenditure cuts and a massive privatisation program. Even then, the man who now says `I understand the economic needs of Australia' could not get his sums right. Do honourable members believe him now? They could not believe him then and they cannot believe him now. It is not surprising that the people of Australia less than four months ago overwhelmingly rejected these sleazy policies. After the election, the new shadow Treasurer, the honourable member for Kooyong (Mr Peacock), undertook to take the Opposition's economic policies in a new direction. But this has now been abandoned. The Deputy Leader and former Leader of the Opposition understood that there was no way that the people of Australia would accept the kind of pap that had been dished out to them by the Leader of the Opposition in the election campaign. Four months later, less than three weeks ago, in this Parliament the Opposition is still arguing the same old rhetoric about privatisation. The Opposition is still saying that the solution to our problem is to have massive expenditure cuts. But it will not tell us, as it would not tell us during the election campaign, where those cuts are to be made. Oh no, honourable members opposite would not want to upset or excite anybody. They thought: `We will just talk in the same kinds of glib generalities and say that there have to be more expenditure cuts'. I would have hoped-and I think in the interests of the people of Australia we all would have hoped-that honourable members opposite would have learned something from their election defeat. I would have hoped that they would have gone back to the drawing board, because this Parliament needs an Opposition that is able to come through with policies that have been thought through-policies which will make a positive contribution to meeting the economic needs of Australia. But what have we received? Week after week, month after month, we have seen a recycling of the same old material. The new shadow Treasurer, the former Leader of the Opposition, has been rolled by the New Right. Let us talk about divisions. There is no Opposition in Australia that is as divided as this Opposition. If one does not agree with this Leader of the Opposition one has no place in the shadow Ministry. Even the distinguished honourable member for Goldstein (Mr Macphee), a distinguished former Minister in this House, has been consigned to the back bench. Why? It was because he had the audacity to have a view different from that of the Leader of the Opposition on the issue of media control. What about the honourable member for Boothby (Mr Steele Hall), a former Premier of South Australia? There was no place for him on the front bench, because he has views that differ from the New Right's. Senator Peter Baume is a distinguished senator. I do not always agree with him, but no one could say that he is not intellectually miles ahead of the people who now occupy the front bench opposite. Not since Snow White woke up and found herself surrounded by dwarfs has there been a selection like the honourable gentlemen opposite. But the difference is this: Snow White did not pick her dwarfs; John Howard did. Four months after the election the Opposition is still trotting out the same old lines: slash taxes-it sounds easy; it sounds marvellous-slash unspecified expenditures and decimate public enterprises. The Opposition tries to talk down the economy. It tried to engender some kind of panic as the stock exchange fell. We were told that we had to have a mini-Budget. That was two weeks ago. Things have improved somewhat on the stock exchange so the Opposition has forgotten all about the mini-Budget. This Leader of the Opposition lives off newspaper headlines. He should not be called Leader of the Opposition; he should be called reader of the Opposition. If the newspapers went on strike the Opposition could not operate because it is incapable of formulating a new concept or idea. Today the Leader of the Opposition sought to capitalise on what he perceives as dissension within the Caucus on the whole question of the role of public enterprises and the options of providing them with capital to enable them to discharge their statutory obligations. There is no secret about the problem which this Government has to face up to. It has been clearly conceded by Ministers and by the Prime Minister (Mr Hawke) that public corporations need to be effectively capitalised in order to provide maximum services to the people of Australia. That is conceded. It has been conceded by Senator Gareth Evans. But we are not prepared to adopt the slogans of the honourable gentlemen opposite who say `The simple answer to all this is to get rid of them-privatise them', because they presume that a public corporation is less efficient and less capable of conducting any business enterprise than a private one. I will leave it to my colleague the honourable member for Burke (Mr O'Keefe) to develop that argument. That is not a situation which we on this side of the House accept, and that is one of the ideological differences between us. Another is this: we do not believe and we will not accept that there is no role for public enterprises in the discharge of public responsibilities. The argument about finance is not sufficient to dismiss the very important public obligations which rest on public corporations to discharge their obligations. We know-as I pointed out to the House less than a week ago-that Telecom Australia could double its profit if it were prepared not to discharge its obligations of cross-subsidy of telecommunications services throughout Australia. Mr Peter Fisher —More taxes for the Government. Mr HOLDING —I am pleased to hear from a member of the National Party of Australia, because at every opportunity members of the National Party quite properly say that one who lives in a remote part of Australia has as much entitlement to a telecommunications service as one who lives in Melbourne or Sydney. They are right in that argument. But what is equally right is the fact that, when Telecom discharges the obligation which the honourable gentlemen opposite want it to discharge, the cost to the taxpayer is very considerable indeed. I cited only last week the decision of Telecom to provide services to a remote area of Queensland which involved, in terms of equipment, capital outlay of well over $1.3m. The cost to the individual consumer did not exceed $1,500. In the provision of those very important services Telecom knew the most it could receive back from that very small community was $30,000. Therefore, the decision was made in terms of public policy which honourable members know involves a loss. There is no way that in discharging that obligation to the public those responsible for the operation of that very important public facility did not know that because of the costs involved they could never hope to make a profit. The figures that have already been cited for Qantas Airways Ltd show that it had a record year last year in both numbers of passengers and profits. But that does not solve the problem that has to be confronted by the Government, by this Parliament, of providing sufficient capital injections to see that Qantas can continue to expand and provide a real and effective service to the people of Australia and to international visitors. The question argued in Caucus this morning was dealt with not in terms of the impassioned nonsense mentioned by the Leader of the Opposition but in terms of how best we manage the resources and the Budget of this country to discharge that obligation. That is the issue that has been raised by the Prime Minister; that is the issue which has been dealt with by Senator Evans, the Minister most directly involved, who makes no secret of the figures that are involved and has indicated the range of options which now have to be seriously discussed and are being seriously discussed not only within the parliamentary Party and in the broader structure of the Labor movement but also within the Cabinet itself. The difference is that those options will be considered honestly, frankly and publicly, and argued out. It is unfortunate for the people of Australia and for this Parliament to have such a totally discredited Opposition which does not have any meaningful role to play in this debate. The argument we heard today was an argument about the perceptions of the Leader of the Opposition about what happened in the Caucus meeting. The fact that it was a totally false picture does not assist the situation at all. The problem that faces the Opposition is the nature of the arguments that have been advanced. The arguments are presented by yesterday's leader on behalf of yesterday's men in terms of policies that belong to yesterday. When this Opposition faces up to the range of problems that have to be considered here and is prepared to put them positively in terms of moving away from some of the perceptions of the New Right, at least it will have moved in the direction of serving those sections of the community that in the past looked to the Liberal Party for some kind of positive contribution to the national debate. Until that event occurs we will receive in this Parliament and publicly the same old mish-mash, the same old rehash of old policies. It is time the Opposition had a new leader, it is time it had new directions and it is time it made a new contribution to this important national debate. Mr SINCLAIR(New England-Leader of the National Party of Australia)(3.54) —The Minister Assisting the Treasurer and the Minister for nearly everything else as I understand his portfolio and probably more importantly the sacked Minister for Aboriginal Affairs has just demonstrated to this House that there is no hope with the Australian Labor Party in office of there being a rational debate on what is a very important and sensitive part of the consideration of the directions for Australia's future. We all know that in the machinations of power within the Australian Labor Party there have been midnight conferences within which, by the casting vote of Senator Peter Cook, the Prime Minister (Mr Hawke) was barely able to get his way. We saw the Minister for Employment Services and Youth Affairs (Mr Holding), who is at the table, scurrying round the corridors of the Senate together with his colleagues of the Centre Left trying to get themselves into a position to advocate what they saw as the necessity to maintain the faith, to maintain the cause. I think all of us were interested to hear that the Minister was very much himself a supporter of public enterprise. As I heard his rhetoric I gather that he knows very little about private enterprise. The fact that he talks about cross-subsidisation as though it is exclusively something for public enterprise and the fact that he says that public ownership is not less efficient all strike me as the manner of a man who, like most of his colleagues in the Centre Left and in the Left of the Labor Party, is not prepared to face up to the realities that 1987 is not 1887, that the circumstances of the creation and the development of the major public enterprises in Australia at a Federal and State level are now changed fundamentally. About four or five years ago on this side of the House there were a number of members, in particular the honourable member for Mackellar (Mr Carlton), who started in public to expose the pros and cons of private as distinct from public ownership of the major enterprises that for so long it was considered, almost as an axiom of faith, should remain part of the public sector. From the point of view of the National Party of Australia we have always accepted that there are certain public interest responsibilities that must be met by those who exercise responsibility in certain areas. But that does not presuppose that those bodies cannot be better operated by private ownership. The Leader of the Opposition (Mr Howard), in his statement today, set down the concluded position of the Liberal and National parties. In our view there are immediately a number of major public authorities at a Federal level that must be privatised and there are a number of others where we are prepared to examine the degree to which public interest and public advantage will be best suited by transferring them to the private sector. It is important that we understand the basis of the argument behind private ownership before I talk about some of the aspects of politics. The first is that the capital requirements by major public authorities are such that they cannot survive in today's competitive environment unless private capital is injected into them. Until these fellows living in the dark ages of the Labor Party, in the Centre Left, in the Socialist Left, in the far Left and in the idiotic Left, realise that these major public enterprises have to have major capital injections there is no earthly chance of them being able to remain competitive. When the Leader of the Opposition was speaking he pointed to the fact that somewhere between $1 billion and $2 billion of capital would be required by a few of those public enterprises not to steal some monopolistic advantage over those operating in that field but just to maintain pace. Let me take the case of Qantas Airways Ltd. It requires an immediate capital injection of $400m and a further $4 billion over five years. We already know that Qantas is falling behind Singapore Airlines Ltd in its competitive position in this part of the world. We all know on this side of the House that the only way we will improve the position is by injecting private sector capital into Qantas. Nobody in their right mind would want to increase public sector borrowings to fund those purchases that Qantas requires. No one in their right mind would say that Qantas must remain locked in public enterprise in circumstances where capital cannot be provided to meet its requirements. We saw an agreement earlier this week by the Trade Practices Commission, News Ltd and Thomas Nationwide Transport Pty Ltd, the proprietors of East-West Airlines Ltd, that saw a call to Australian Airlines to involve itself in some intrastate services in New South Wales. The reality is that Australian Airlines, just to remain competitive on the major interstate trunk routes, needs an immediate capital injection of $200m. The Commonwealth Bank has requested a $150m dividend release. It is likely to need a further $200m to $300m to broaden its capital base. Aussat Pty Ltd needs $800m for second generation satellites. The Overseas Telecommunications Commission annual report lists capital expenditure of $154.2m. Mr Cleeland —What about Telecom? Mr SINCLAIR —I am delighted to hear somebody mention Telecom. The failure of the Labor Party in looking at both Telecom and Australia Post is not to realise that there are significant areas of both enterprises which could be undertaken more efficiently by contract labour and by private enterprise, as everybody would know. Mr Holding —Tell us what. Mr SINCLAIR —I would be very glad to tell the honourable member. That is the trouble; the Labor Party is not interested in how to operate effectively. Telecom has used up to 85 per cent of its revenue each year in order to maintain its very significant capital program. This year it talks of a capital program for the financial year of $2.8 billion. If the Government wants to find a way by which it can help to overcome that, it should start to look at all those facilities away from the central network and see how it can provide contract labour, private sector labour and qualified people, such as teletricians or whatever you like to call them, who could be licensed to work for Telecom and who can provide services in a competitive manner. If the Government starts by providing those services-- Mr O'Keefe —With the farmers paying full cost. Mr SINCLAIR —I inform my honourable friend that in my home town last weekend there was nearly a million dollars worth of capital equipment lying idle, because Telecom employees do not work at weekends. If we had private sector contractors laying cables and private sector contractors providing connections to farms, businesses and properties, we would have a more efficient service. If the honourable member thinks that there is no comparison, let me draw his attention to the fact that in the United Kingdom, where British Telecom has been privatised-in spite of the fact that we on this side of the House would prefer to see that greater breakup of some of the present services-it is interesting that a British expert has said that a measure of the improved level of service was that it now took eight days to get a phone connected, while it had taken eight months in 1984. So do not let anyone think that there are not improvements out of the introduction of private capital in a large range of private enterprises. The reality is that this debate is not about the arithmetic of privatisation; it is about the politics of division in the Labor Party. We have all heard all members of the Labor Party, from the Prime Minister down, bucket privatisation. We know all about the problems the Labor Party has had in coming to truth with itself. We know that the Treasurer (Mr Keating), for example, has said: The Labor Party will fight tooth and nail to keep these public authorities in the hands of the Commonwealth. The Prime Minister has said that privatisation: is a one-off fire sale, a sale of the century, of your assets-the assets of the people of Australia. He said-and this is a laugh: They would transfer them into the hands of a privileged few- I wonder whether he has discussed anything with Premier Burke of Western Australia of late- to the cost of every one of us. Then we had the Prime Minister again: Anyone who knows anything about economics and matters fiscal understands that privatisation is no substitute for the hard decisions that have to be taken on government expenditure. Then we had Senator Walsh, the Minister for Finance, criticising the Leader of the Opposition in South Australia. In the Senate Hansard of 26 November 1985, Senator Walsh said: Mr Olsen says that he will fund his tax cuts by selling assets. That is another way of saying that he will liquidate assets in order to fund current expenditure. We all know where that road leads. If one keeps going down that road for long enough, one finishes up insolvent. How fascinating it is that part of the balanced Budget this year was achieved by a billion dollars, which, according to the Treasurer, came from the selling off of government assets. But of course we all know Senator Walsh's criticism of this year's Budget. The reality of this debate is that the Government is not interested in the real advantages between private and public enterprise. There are advantages in privatising authorities that for so long have been held in the public sector. They should not be approached without regard to public interest. They should not be approached without a proper concern for those who are working in those enterprises and their opportunity to gain shares in those enterprises and, of course, for the interests of consumers. But certainly, they should not be approached on the basis of the left wing of the Labor Party-- Mr DEPUTY SPEAKER(Mr Ronald Edwards) —Order! The right honourable member's time has expired. Mr O'KEEFE(Burke)(4.04) —Before I address the principal points raised in the matter of public importance today, I want to make a couple of comments about the contribution from the right honourable member for New England (Mr Sinclair). I suspect that his mind is actually elsewhere, on the real privatisation move taking place today, that is, the move to privatise someone in the Queensland Government and to get him off the public sector payroll-or the five Ministers in the National Party Government that have been dumped up there today. The right honourable member talks about division. He has a big smile on his face as he sees what is taking place in his own Party in Queensland. The right honourable member also talked about the benefits to Australia of privatising these public sector operations, because presumably there are going to be capital injections from the private sector. I just ask the right honourable member for New England: In an environment where the private sector has been nothing less than pathetic in its investment in industry and in its investment in productive enterprise in Australia over the last decade, just where is it planned that all this capital injection will suddenly come from? Of course, the answer is: It will be borrowed off-shore and dudded against the Australian taxpayer by leverage against the tax system. That is where those on the other side of this House see this inevitable pool of capital coming from, subsidised by taxpayers' deductions against off-shore borrowings. Let us look at two things. First of all, let us look at the record of the Government in its management of its public sector enterprises and, secondly, let us look at this assertion that somehow these enterprises would perform better under private sector control. When this Government came to office there were a number of public sector operations which had been allowed to run down and had been discriminated against in the market-place by the previous Government, which was totally private sector oriented. If we look at some of the more spectacular examples and take, for instance, the Australian National Line (ANL), we see that in 1982-83 ANL had a record loss. It had been allowed to run down to the point where there was a loss from all services amounting to $26m. To alleviate the burden of ANL, the newly elected Labor Government injected capital and gave a loan conversion. The situation now is that the trading performance of ANL has been completely turned around. Some of its dividend capital has now been repaid, and it is now a tax paying organisation, recording a profit and paying tax in the Australian economy as against the loss it was making under the administration of the previous Government. The Minister at the table, the Minister for Employment Services and Youth Affairs and Minister Assisting the Treasurer (Mr Holding), in his contribution a little earlier, mentioned Qantas Airways Ltd. There has been much discussion about Qantas. Suffice it to say, under the controls of this Government Qantas has also turned its performance around, and last year turned in a record operating profit of $104.3m, the highest ever recorded by the company. That has enabled Qantas to pay a dividend to the Government this financial year of $20.2m. In other words, from a zero point, from a loss and from being run down and not being allowed to compete profitably, these organisations are on the turnaround. Honourable members opposite ought to be aware-or they conveniently fail to concede-that Australia Post is, as far as I understand it, the only public sector postal organisation of the Organisation for Economic Co-operation and Development countries that does not require an injection of funding or recurrent funds from government Budget in order to operate. It is a public sector postal operation which is fully self-sufficient. And the list goes on. The Leader of the Opposition (Mr Howard) mentioned the Overseas Telecommunications Commission (OTC) and Aussat Pty Ltd. Is it any surprise that suddenly OTC has made its way into the Opposition's list of organisations to be sold off? OTC is responsible for Australia's international communications service, and it is one of the Government's most efficient business enterprises. I have not yet heard one member of the other side of this House come forward and propose the privatisation of, for instance, V/Line in Victoria or any of the loss-making organisations of any substance. They are not interested in buying the loss-making organisations and picking them up and making them more efficient. They want to pick the eyes out of what is running well and profitably, and transfer those profits to the private sector. OTC is a very interesting example, because by the year 2000 the world will be communicating via satellite and all the other modern technology. That is where the big bickies will be made. Honourable members opposite are trying to transfer the ownership and profits out of the government sector and into the private sector. One should not forget that that is the motive behind the push for privatisation. Let us examine the assumption that somehow the management and the capital injectors in the private sector are more efficient and more capable. In Question Time today the Minister for Consumer Affairs (Mr Staples) again pointed to the problems that he is having with recalls of bodgie products in the Australian economy. Where are all these private sector whizbang managers who are producing quality products? Why has there been such trouble in selling Australian products off-shore? Where are all the people who are able to do these things so wonderfully? What about the problem that is now occurring with chemical residues in Australian meat exports? Where are all these people in the chemical industries with a social conscience? Where are they in controlling Australian products and making sure that they are of world standard and not putting us at risk? No-the Government has to be in there bailing out everybody, putting in testing procedures to ensure that these private sector people conform to their social obligations. Mr Martin —What about industry policy? Mr O'KEEFE —My colleague asks what about industry policy. What has this Government had to do since it came into office? One has only to look at the rescue packages, such as that for Broken Hill Proprietary Co. Ltd. Where are all the whizbangs who were running these shows so efficiently? Government money has been poured into resurrecting the steel industry. Government money has also been poured into the motor vehicle plan to get the Australian motor vehicle industry back on its feet. What about the resource companies like Peko-Wallsend Ltd and others that, on the advice of Opposition members, rushed off-shore and borrowed overseas because there was to be a resources boom? Now the prices of their products have hit the deck and those companies are still stuck with interest bills on borrowings. The answer they see to their problems is to squeeze the conditions of the workers in the industry and to make the workers pay for those companies' bad decisions. Let us not forget that that is the underlying philosophy. The heavy engineering industry has a heavily subsidised government program to get that industry back on its feet. My colleague the honourable member for Macarthur (Mr Martin) shortly will produce a report on the coal industry. Where have all these whizbang private sector managers and entrepreneurs been while the coal industry has been going down the tube? What about the clothing, textile and footwear industry and the rescue package which the Government has had to put in place for that industry? One could go on and on with such examples. But Opposition members come into the House and say that the Government should hand over Telecom Australia, Qantas, Australian Airlines, Aussat and OTC-all profitable government enterprises-to the people I have mentioned. Heaven's above! Every time the Industries Assistance Commission produces a report suggesting that we should lower tariff barriers, open up trade and remove protection, every Labor member is beset by lobby group after lobby group, from managers, manufacturers and owners, beating a trail to his door pleading that the Government not give in to the push to reduce protection. Under governments of the likes of that which the right honourable member for New England was a leading Minister and heavy, the policy of protection and barriers was set up. These enterprises have a place in the public sector. Certainly there will be change and improvement, but the answer is not to send them down the path of the duds. The answer is for us all to take a constructive approach to ensure that those enterprises remain in the government sector and remain efficiently and well managed in that sector. Mr DEPUTY SPEAKER(Mr Ronald Edwards) —The debate is now concluded. Mr MARTIN(Macarthur) —On behalf of the Standing Committee and Finance and Public Administration, I present the report of the Committee on the Australian iron and steel industry, together with the minutes of proceedings and evidence received by the Committee. Ordered that the report be printed. Mr MARTIN —by leave-The former House of Representatives Standing Committee on Expenditure began in early 1987 to examine the efficiency of Government expenditure into the Australian iron and steel industry. This expenditure was encapsulated in the steel industry plan which was designed to create a long term viable steel industry, one which would provide job security for its employees and become internationally competitive. Given the steel industry's importance to Australia's industrial base and to the economy, the recovery of the steel industry should be important to every Australian, not just those in the steel regions who are directly affected by the industry. The election was called before the Expenditure Committee could table its report. The newly constituted Finance and Public Administration Committee realised the importance of the information and decided to complete the inquiry as soon as possible. Because of these factors, some of the information in this report is rapidly becoming outdated by events. Although the report has been updated as much as possible, the last formal hearing was held on 29 May 1987. Nevertheless, both committees realised the value of such an inquiry, and we have tried to table the report as early as possible in the new Parliament. We feel that it will assist the Steel Industry Authority (SIA) in its current review of the plan and sincerely hope it will assist the industry in overcoming its major problems. The Committee has found that the plan has indeed stimulated the steel industry's return to profitability from its poor economic base in 1982-83 prior to the plan. We are convinced that, without the security and incentive provided by the plan, the industry would not have had the confidence to embark on its investment program and Broken Hill Proprietary Co. Ltd (BHP) would probably have closed at least one of its integrated plants. I note with interest recent comments by BHP senior management on this particular issue and I shall address that matter later in my remarks. The major part of the Commonwealth's expenditure into the steel industry has been in the form of bounties. These bounty payments have helped to contain steel prices and have provided significant benefits to downstream steel users. So far, bounty payments have cost the Government less than half the amount originally envisaged-$117m compared to a possible maximum of $250m. The lower expenditure on bounty payments, combined with the fact that the level of government assistance to Australian industry is far less than the level of assistance that overseas Governments give to their steel industries, led the Committee to conclude that the industry's recovery has been stimulated efficiently and effectively. We also found, however, that factors outside the plan have been a significant force in the industry's recovery. In financial terms, these other factors may have contributed more to the industry's recovery than the bounty payments. The benefits derived from the sustained depreciation of the Australian dollar, the investment allowance and accelerated depreciation provisions have been considerable. The industry has also benefited from the worldwide steel industry recovery and signs of improvement in the industry's domestic performance were already evident before the plan started. The Australian economy, manufacturing production and domestic steel production all moved back into growth in the September quarter of 1983. Nevertheless, the plan provided market security and incentive, enabling BHP's $1.4 billion investment program and the corresponding investment by other sectors of the steel industry. More importantly from the Committee's viewpoint, the recovery has been stimulated efficiently. Despite the industry's recovery, we found that a number of problems still confront it, the most serious and pressing of these being the unacceptable level of industrial disputation. Although the unions' performance was excellent during 1984 and 1985, their actions in 1986 and the first half of 1987 led the Committee to conclude that the unions were no longer meeting their commitments and were in breach of dispute settling procedures under the plan. This view has been highlighted recently in the Steel Industry Authority's annual report and in statements made by BHP. Port Kembla, I am particularly sad to say, is the area of most concern. At Port Kembla, the level of industrial disputation reached pre-plan levels. During April, May and June this year, Port Kembla alone was responsible for over 90 per cent of the total man-hours lost at BHP, which in turn has prompted BHP to announce that it will not proceed with the $160m rebuild of its No. 4 blast furnace at Port Kembla and would not invest any more money in the steel industry unless the industrial climate improved. Whilst acknowledging that there has been such an improvement in the second half of 1987, nevertheless concern must be expressed at statements last week by the management that BHP might close its operation at Port Kembla. Threats of this type do not assist in facilitating an improved industrial relations climate. As I have indicated previously in debate on this issue, I hope that both management and the trade union movement associated with the steel industry can come to terms with this problem. There is now just over 12 months of the steel industry plan remaining, after which there will be no security net for the industry. The future of the plan and the future of the industry lie largely in the hands of the unions. The Steel Industry Authority, which is responsible for monitoring each party's adherence to the plan and encouraging co-operation and dialogue between each of the parties, has been relatively ineffective in alleviating the industrial situation. We have recommended that the Australian Council of Trade Unions accept overall responsibility for the unions' commitment to the plan and take whatever action it can to get greater commitment at shop floor level. The Committee hopes that this will overcome some of the sectional interests that are currently threatening the plan. It concerns the Committee that the SIA has decided to stop monitoring the unions' adherence to the wage settling commitment, with no real explanation. Unless there is an agreement between the SIA and the Minister, of which the Committee is unaware, to cease monitoring this aspect of the plan, the SIA should perform its role and resume monitoring this aspect of the plan. Yet the process of industrial relations is not a one-way street. The SIA has said that the Australian steel industry has the potential to be- come the world's lowest cost steel producer and potentially a competitive exporter. However, the realisation of the potential is almost entirely within the hands of the industry. The world steel market is extremely competitive and, in many cases, heavily assisted and protected by governments. The future of the Australian steel industry lies with its management of capital and manpower. Further productivity gains are essential for the industry and totally dependent on its labor force. Failing commitment can easily jeopardise the hard-won gains made so far, and at worst jeopardise the industry's existence. This is still the most important step the industry must take. The Committee has made a number of recommendations to assist the domestic steel industry, which I will briefly outline. We are concerned with the inadequacy of the existing anti-dumping mechanism. One of the Government's commitments under the plan was the establishment of an effective fast-track, anti-dumping system, responsibility for which was given to both the Steel Industry Authority and the Australian Customs Service (ACS). We found that all sectors of the industry were dissatisfied with the system; that an efficient mechanism was never put into place; and that neither body was accepting responsibility for the mechanism. To ensure that an efficient mechanism is in place we have recommended that the roles of the SIA and ACS in this area are clearly delineated; that a clear set of policy guidelines are developed by the ACS to ensure systematic investigation procedures and to help the industry to prepare its case; and that recommendations of the Gruen Report on the Review of the Customs Tariff (Anti-Dumping) Act 1975, tabled in March 1986, are acted upon. Professor Gruen made a number of recommendations on anti-dumping measures and, although the Government has accepted most of the recommendations, as yet not one has been implemented. Most recommendations are still awaiting legislation to amend the Customs Tariff (Anti-Dumping) Act. Also in relation to anti-dumping, the Committee would like to see strict deadlines for the completion of preliminary and final findings, some of which have been taking up to two years for a response. A related issue is that of secondary dumping of steel feed, which affects downstream steel users. The problem is that secondary dumping is almost impossible to prove, involves considerable work and has little chance of success. We have recommended that the secondary dumping issue be immediately referred to the Industries Assistance Commission for advice on whether longer-term anti-dumping action is desirable. The Committee has also made a recommendation on developing country preferences for steel imports. We can see no justification for the present situation, which allows reduced tariff imports from countries possessing technologically superior steel industries to Australia's and which are heavily protected by their own governments. We have recommended that the whole area of granting developing country preferences be reviewed and, specifically, that the remaining preferences for steel imports from South Korea be removed. We also found no justification for the continuation of an agreement between the United States of America and Australia, restraining Australia's exports to the United States. The Committee believes that the export restraint agreement can cut back potential steel exports to Australia's disadvantage. Although it is not having a great effect on exports at present, due to current production difficulties by BHP and lower production because of industrial disputation, in a revitalised industry it could considerably limit potential exports. We recommend that, at the expiry of the current agreement in 1989, the relevant Ministers-that is, the Minister for Foreign Affairs and Trade (Mr Hayden), the Minister for Trade Negotiations (Mr Duffy) and the Minister for Industry, Technology and Commerce (Senator Button)-re-examine the need for Australia to enter into another agreement with the United States of America. If another agreement is unavoidable, we would like to see the export level recalculated on a more appropriate base year. In conjunction with the steel industry plan, the Committee examined the steel regions assistance program, which, although separate from the plan, was implemented at the same time. The program is providing $102m over a period of five years to assist the major steel regions in economic diversification and to expand employment opportunities. One of the most important aspects of this program to the regions was the tourism component. Although some of our recommendations have been largely overtaken by events-and I will not say too much now-the essence of the problem was inadequate local consultation, a convoluted approval process ranging from local to State to Federal governments, and outstanding expenditure for this component. We have made recommendations to overcome these problems and perhaps to indicate potential problems in relation to future regional assistance packages. Finally, I would like to thank all those who have contributed to this inquiry. In particular, I thank those members of the original sub-committee, the honourable member for Banks (Mr Mountford), the honourable member for Lindsay (Mr Free), the honourable member for Wannon (Mr Hawker), the honourable member for Bass (Mr Smith), the honourable member for Charlton (Mr Robert Brown) and the honourable member for Fraser (Mr Langmore), who are no longer members of the Standing Committee on Finance and Public Administration; the honourable member for Calare (Mr Simmons), who is a continuing member and I am sure will contribute great things to the present Committee; the Committee secretariat and in particular the Committee Secretary, Monica Telesny, and Mr Peter Ratas, Ms Kelly Edwards and Ms Kylie Freer. I would also like to thank Mr Ian Glasson from Esso Australia, who was a secondee to the Committee during its inquiry. As I said at the outset, I believe the inquiry has provided a great deal of useful information which will assist the Government, the Steel Industry Authority and, indeed, the participants in the Australian steel industry to come to terms with the problems that continue to exist in this major industry. I look forward to a positive response from all the participants to this Committee's report. Mr BRAITHWAITE(Dawson) —by leave-In speaking to the report from the Standing Committee on Finance and Public Administration, following the Chairman, the honourable member for Macarthur (Mr Martin)-a man who has dedicated himself not only to the steel industry but also to the coal industry-I point out that I was not on the original Standing Committee on Expenditure but I have since joined the Finance and Public Administration Committee, with its new title. As far as this report and its recommendations are concerned, I will not say anything, except that, as the honourable member for Macarthur indicated, events have overtaken the report in many circumstances. Only last week an article which appeared in the Australian Financial Review, headed `BHP gets tough: ``we would close Kembla'' ' stated that the General Manager of the Broken Hill Proprietary Co. Ltd's steel international group, Mr John Prescott, said that BHP would close its massive Port Kembla steelworks if industrial relations at the plant did not improve dramatically soon. He went on to say that if the recent deterioration in industrial relations at the plant continued he `would not be averse' to recommending to BHP's board that the company `walk away' from Port Kembla. The article states: One source said the BHP executives told the members of the Caucus committee that given the recent state of industrial relations the company was `not prepared to invest one more discretionary dollar in Port Kembla until they got undertakings from the unions that they would co-operate'. Whilst in 1984-85 under the steel plan the Government's relations with the union were considered very good, in 1986-87 they have deteriorated. The aspect of the report I want to comment on is a matter of omission, not of commission. The honourable member for Macarthur mentioned the great competition we face from countries which are technically superior to us in steel making. He also mentioned the tourist industry and its opportunities. I give one example to highlight what we are getting at. The new floating hotel off Townsville was completely constructed in a Singapore shipyard from overseas steel. Bethlehem Steel produced the steel for it. That has been a great loss to Australian industry. We are not necessarily technically inferior. A submission by CRA Ltd was placed before the Committee. CRA is interested in the Hamersley iron fields in the Pilbara and the port exporting facility at Dampier in your State, Mr Deputy Speaker. CRA is the most efficient producer or developer of iron ore in the world. Events have overtaken the report. Tragically, only in the last couple of weeks a deal has been made with Hamersely to produce iron ore from a new facility using the current infrastructure and ship it to China. All Australians are wondering about substantially enhancing our resources through the available labour market in Australia. As I said, CRA put before the Committee a submission. Obviously, it has gone a long way towards looking at the enhancement process. It considers that it could become a major steel developer in Western Australia, using its ore, natural gas or whatever and the superior technology used by BHP. It is not a matter of trying to get back the share of the market that the Australian steel industry once had. It is a matter of expanding it. Surely the time has come when Australia has the vision of companies such as CRA which can use circumstances to get into the enhancement process. We hear about it day after day. After the war we could produce motor cars. Today we cannot. We could produce certain white goods. Now we cannot. The Government, industry and BHP ought to question why this is so. Is it because we are technically deficient? CRA says that it is not. Is it because we are not efficient producers of basic resources? Again the answer must be no. We must get back to the industrial relations aspect which was mentioned and consider where Australia's future lies in regard not only to our resource production but also to the enhancement program. As I have said, the fault I find with the report is one of omission. This aspect was not taken up. Although the report is about the steel plan and what will probably happen over the next 12 months, surely it provided a great opportunity to look at where Australia is going in regard to the production of basic resources and their substantial enhancement. The Government, Australians and everybody concerned should consider these points, not only with regard to steel but also with regard to so many other commodities. If we are to recapture our place in the world market it will have to be through the manufacturing process and the development of services and technology. The Minister for Science and Small Business (Mr Barry Jones), who is at the table, knows full well what I am talking about. Australia has the capacity. Why do we not exploit it? It offends me to think that in the midst of the production of this report an agreement has been reached under which we again will act as the quarry for the world, supplying our raw material to an overseas market to be enhanced to its profit. I pay tribute again, as I have done on past occasions, to the Chairman of the sub-committee for the work that he has done on this matter. I appreciate his frankness in the comments he has made. I hope that the frankness of my comments will be appreciated by him. Dr HARRY EDWARDS(Berowra) —by leave-As the report by the Standing Committee on Finance and Public Administration presented by the honourable member for Macarthur (Mr Martin) rightly points out, the steel industry is one of Australia's most significant industries. It has the potential to be one of the lowest cost steel producers in the world. Certainly that will be so once the $1.4 billion investment program which Broken Hill Proprietary Co. Ltd (BHP) has undertaken is concluded. The company will then have some of the most modern steel making facilities in the world. It has easy access to high quality coal and iron ore. All this gives it the potential to become, as I have said, the lowest cost steel producer in the world, a competitive producer, both in competition with imports and as an exporter. As the honourable member for Macarthur mentioned in his remarks, although I believe without sufficient stress, what can stand in the way of all this is poor industrial relations. That is what is happening now. Senator Walsh, the Minister for Finance, said, in reply to a question asked in the Senate recently: I agree that it is deplorable that, after the company- that is, BHP- has met its obligations in terms of investment-indeed, in terms of quantity it has more than met its obligations under the plan-and the Government has met the obligations it accepted in 1983- in terms of the subsidy to which the honourable member referred- the work force is actually letting the agreement down. I think that is very bad. If the people concerned are interested in keeping their jobs, they had better lift their game in comparison with what it was in the June quarter. The record of industrial disputation, particularly at Port Kembla, has been lamentable. Only the other day the Australian Financial Review, in a different context to that which my colleague referred to a moment ago, referred to the `damage inflicted by a series of stubborn, pointless and ill-directed industrial disputes by a militant local section of the Federated Ironworkers Association'. The number of manhours lost at Port Kembla in recent times is 84 per cent higher than it was in the six months to November 1981, long before the development of the current plan. What is of particular concern is that much of this disputation is not concerned with seeking additional wages or directed at the company but is related to outside issues. For instance, there was a protracted strike over a proposal in relation to WorkCare in the area. Perhaps the biggest factor in the disputation in the first six months of this year was a refusal by the New South Wales South Coast union movement to recognise that the existing financing of workers compensation in New South Wales had to be changed if the State was to maintain its share of future industrial investment. In other words, it was a dispute with the New South Wales Government, although, of course, the primary target of that disputation became Broken Hill Proprietary Co. Ltd, which had nothing to do with the handling of workers compensation legislation and could not have given the militant unionists anything, even if it agreed with the aims that the union was pursuing. The eventual result was that BHP lost export sales of $20m to $30m to the Philippines, South Korea, the United States of America, China and New Zealand and had to order 155,000 tonnes of raw steel from overseas to cover a local shortfall. So one result was lost export sales. More importantly, the BHP Board determined and in fact cancelled, as I am informed, plans to expand the Port Kembla No. 4 blast furnace at a cost of $165m, which was an investment that was crucial to raising steel capacity to a planned 4.2 million tonnes a year. The company contented itself with a $15m 11-week reline, which will leave production capacity where it is. I stress the point that this country is in a very difficult economic position. We have to come to terms with our vast balance of payments deficit and massive overseas debt situation. Mr Cowan —We should not be importing steel. Dr HARRY EDWARDS —We should not be importing steel but, more importantly, we should be exporting steel. We need in this whole context a change in fiscal policy, in the total government spending. I shall not enlarge on that. In that context, we also need a further tightening in restraint on wage levels; that is inescapable. But, in the long term, domestic demand should be held taut and resources-new investment-should be taking place in areas to enable additional exports and in the production of local goods in competition with imports. It is absolutely essential to the long-run solution to the overseas debt and our continuing balance of payments problem that there be significant investment in areas of export production and in the production of goods in competition with imports. That is absolutely critical. Here we have a clear example of how irresponsible and often pointless action by militant trade unionists interferes with the carrying out of that sort of investment, which is so necessary to solve our long term problems. I could cite other examples, but time is pressing. It is particularly important that here is a steel plan that has support from both sides of Parliament; the company has carried through its undertakings in relation to new investment for greater efficiency; the Government has met its obligations; but, as a result of irresponsible trade union action, the whole proposal is being put in jeopardy. If that sort of thing becomes widespread throughout this country, the solution of our long term problems will be held back, and the necessary investment in the export and import competing sectors will not take place. [COGNATE BILL: PETROLEUM EXCISE (PRICES) BILL 1987] Debate resumed from 18 November, on motion by Mr Barry Jones: That the Bill be now read a second time. Mr DEPUTY SPEAKER(Mr Ronald Edwards) —I understand that it is the wish of the House to debate this Bill concurrently with the Petroleum Excise (Prices) Bill. There being no objection, the Chair will allow that course to be followed. Mr SINCLAIR(New England-Leader of the National Party of Australia)(4.46) —Mr Deputy Speaker, as you have just intimated, there are two Bills before the House. One is the Excise Tariff Amendment Bill (No. 2) 1987; the other is the Petroleum Excise (Prices) Bill 1987. The combination of the two Bills is effectively to put into place the deregulation of the oil industry. The actual circumstances, however, the manner and form of the Government's actions in this matter, are not something in which there is any more consistency than there was in the privatisation debate that occurred a little earlier in the day. Indeed, the House of Representatives Hansard back in the days when the Australian Labor Party was where it will be as soon as we can possibly get it there-back in opposition-contains some interesting observations by the Treasurer (Mr Keating). Given that the present Treasurer seems to believe in the past in a way that really does not enhance his reputation, I thought it would be worthwhile at the beginning of this debate to refer to the remarks that he made when he occupied the position that I now occupy-that is, spokesman for the Opposition on resources. Surprisingly enough, there was a similar Excise Tariff Amendment Bill before the House and it seemed to me to be very appropriate that, therefore, his remarks might be borne in mind when considering these changes in the excise formula; for they essentially are to change under the present legislation from using the import parity pricing base to using a new base, a base that is determined by calculating the excise on the volume weighted average prices realised for crude oil sales. Of course, only part of Australia's crude oil production is excisable-that produced by Bass Strait producers. So the form is to change from one based on import parity pricing to one based on volume weighted average prices, and I shall speak a little more about that in a moment. The introduction of import parity pricing was the circumstance of that Excise Tariff Amendment Bill referred to in the House of Representatives Hansard of 2 April 1981 when the present Treasurer said: We- that is, the Labor Party- . . . are opposed to import party pricing. We do not believe Australians should be forced to pay through the nose for their own oil. The Opposition- that is, the Labor Party- . . . is opposed also to the use of the crude oil levy as a mechanism for taxing oil producers. It is inefficient and inequitable and should be removed and replaced by a properly designed resources rent tax which is neutral in its effect, efficient, and a better mechanism to divide this wealth between the companies and the community. One of the interesting parts of this debate is that there is, in fact, an increase in the excise. So much for the Government and the Treasurer in particular-the man who, above all, is responsible for administering this particular part of the legislation. So much for his desire to get rid of it. Indeed, we now find ourselves in a position where, as a result of the increase in excise, over a period of years the Government's dependence on crude oil as a source of revenue will continue to be high. I am told that, as a result of some negotiations with the Bass Strait oil producers, there will be an increase in excise from 6c a litre to 20.83c a litre as from mid-October 1987. Of course, members on this side of the House have always said that import parity pricing was right but, equally, we say both automatic indexation, which is referred to in these Bills, and the dependence of the Government on fuel excise have a cost, and the Treasurer recognised that cost when he was in opposition. But he has totally ignored it in the years that he has been in government. Not only has he ignored it, but he has also significantly added to the cost the average motorist pays for petrol and oil products because of the way in which the Labor Government has depended so heavily upon a tax which the Treasurer himself acknowledged was inefficient and inequitable and should be removed. It is interesting that in those days, in opposition, this Treasurer said: We have a sleight-of-hand policy, a tax by stealth levied at the bowsers instead of being levied directly through the tax system or through incomes . . . How right that is. Yet here is this Treasurer denying money for roads. I see my colleague the honourable member for Lyne (Mr Cowan), whose electorate roads, like mine, are absolutely deplorable. They are deplorable because this Government has reduced the amount of money that goes to the States to develop their road systems. Mr Cowan —I would like him to travel to Bulahdelah on the Pacific Highway. Mr SINCLAIR —The Bulahdelah-Pacific Highway route is one; I can tell the House about a few others in New England. Mr Beale —They ripped that up and now it is going to gravel. Mr SINCLAIR —That is so right, as my colleague says. The Treasurer continued: The trite argument advanced by the Government that one needs to have a high price-the world price-for oil discovered 10 years ago in order to keep exploration going is nonsense. It is amazing how everything that he said in that debate has now been reversed. What he said then was: Another aspect of the Government's crude oil policy which needs a mention is the nature of the crude oil levy. Just listen to this: All levies are arbitrary, inefficient and inequitable. They create distortions in investment decisions, in particular, in the bringing into reduction of smaller pools of oil and in the extraction of maximum possible levels of oil from producing fields. Those remarks are absolutely applicable to the Bills now before the House. There is little doubt that the circumstances have changed, but the circumstances of this present Labor Government have changed to the point where all those homilies of the Treasurer have been ignored and excise today is more and more the agency of the Australian Taxation Office. More and more those words of the Treasurer, when he talked about `a sleight-of-hand policy', about `a tax by stealth levied at the bowsers'-- Mr Goodluck —Yes. Mr SINCLAIR —And my colleague from Tasmania the honourable member for Franklin, agrees-are statements on matters that affect the ordinary men and women of Australia. Whilst we are totally in favour of deregulation and whilst we support these two pieces of legislation, we say to the Government that the way in which it is increasing excise and the way in which excise itself is becoming more and more a vehicle from which the Government funds its extravagant programs are matters which the Opposition believes the people of Australia should have brought to their attention. There are, of course, in the changes to the formula a number of intricacies which really do not bear elaborate scrutiny in this place. There are, in the introduction of this volware base, as it is called, for determining excise, a number of statistical changes which I am told have generally been accepted by the industry. However, a number of aspects of the changes need to be considered. The first is that if there is, as is suggested, to be a price reduction at the bowsers as a result of these changes, it needs to be understood that it does not come from any great generosity on the part of the Government. What it does do, of course, is reflect the actual change resulting from the volware determination. In other words, the reference price will be adjusted for relevant factors such as movements in world oil prices and changes in exchange rates. Those factors may lead to short term reductions in fuel prices. But there are two dimensions of this equation which people need to keep in mind. The first, and obviously the one that is of most sensitivity, is the price of petrol at the bowser, the price of fuel at the tank, the cost to the motorist, the cost to the energy consumer, if he uses not only petrol but also distillate, fuel oil or any other products emanating from the oil industry. That is the sensitive part and it is the one where government intervention has made the price so dear. But the other end is the one which led us in government to introduce import parity pricing. That is what we see as the absolute necessity to encourage exploration and production of oil. I believe there is a great deal that needs to be examined in respect of where we go in terms of future exploration. Indeed, part of our concern in the details of these changes is the way in which there could be an effect on small oil producers. We certainly support deregulation, but the Government has been involved in rhetoric and has said that it will look after the small oil producers. On our side of the House, we say that we would be looking at the trade practices legislation to ensure, through its mechanisms, if there is need to help the small oil producers, that there is a technique that is sufficient to be able to ensure that not only the large producers but also the small oil producers can continue. Recently there has been a significant increase in on-shore exploration, but I am concerned that there should be a continuation of exploration off-shore. Sadly, the record off-shore has not been as good as it has been on-shore. Frankly, with the changes, particularly following the introduction of the resource rent tax, we see the circumstances of disencouragement and of disincentive pursued to the point where it is not only going to be extraordinarily doubtful that Australia's self-sufficiency or reasonable self-sufficiency can be maintained into the 1990s, but we will have what has been said will be a $3 billion Budget deficit that will creep in as a result of the change in dependence on domestic produced oil to imported oil. All those are matters which, in the consideration of the Government's total oil package, have to be put into perspective. This particular package, of course, is a significant element of the deregulation of the market, but the circumstances of the introduction of the resource rent tax and the way in which the Government is pursuing its policy make us concerned that there will be problems in the future. The Government seems to be almost totally ignorant of them and certainly not prepared to do very much about them. But, of course, the Government will say that part of this package relates to the incentive that it will give to new oil discoveries by exempting the first 30 million barrels of oil from on-shore discoveries and that they will be excised free regardless of when production started. I am told that new off-shore projects will also be able to claim the first 30 million barrels of production free of excise. I am told that there have been some changes in the application of that particular concession. If that is so, and if the Government is now in any way to water down that concession-the Minister for Science and Small Business (Mr Barry Jones) should advise the House when he responds in this debate, which I trust that he will do-and there is some doubt about that full concession, particularly for off-shore explorations, there will be real problems for the industry in the future. Honourable members should understand that this will affect the level of future exploration in a way which cannot help the industry. There are also within the Petroleum Excise (Prices) Bill some problems with respect to safeguards to ensure that the prices realised by domestic crude producers in fact reflect the best on offer, be it from a domestic refiner marketer or an off-shore bidder. A producer should not have the right, according to some sectors of the industry, to sell crude off-shore at a discount when a domestic buyer is willing to offer more and expect the Commonwealth to subsidise the discount sale by reducing its excise share. In other words, there are a number of formula consequences, one being the extent to which small oil producers are affected; a second being the degree to which there will be adequate stimuli for future exploration; and the third being the degree to which in some instances sales might be made off-shore at a discount, thereby leading to the Commonwealth subsidising the sale by reducing its excise share. There are, therefore, within this legislation, a number of matters which the Government needs to consider and comment on. However, there are a number of other aspects of the legislation which I wish to comment on briefly. There is reference in the Excise Tariff Amendment Bill (No. 2) to the change in circumstances applicable to duty on aviation gasolene, or avgas. I have been told that long ago the Minister for Transport in the last Hawke Ministry apparently refused to accept industry proposals that there should be a switch from the levying of air navigation charges to the imposition of a levy on aviation gasolene. However, this charge has been incorporated in legislation on this occasion. The then Minister for Transport should tell the House why he refused to acknowledge that change. According to the second reading speech of the Minister for Science and Small Business, landing charges will still be levied on general aviation. The National and Liberal parties are concerned that general aviation remain viable. We are concerned that there should be no disincentive for those who provide a very important alternate transport service around Australia. They should not be unduly discouraged. If there is a switch from navigation charges to an increased price in aviation gasolene, we hope that that will not mean that there will be a continued increase in price to the point where general aviation becomes less and less viable. However, as I have said, the industry originally made this suggestion about four years ago. I gather that the industry is quite pleased with the proposal and, therefore, the Opposition offers no objection to it. However, a number of other aspects of the legislation deserve to be considered in relation to deregulation. To us deregulation is still only a very small way along the line. For example, we are concerned that the Prices Surveillance Authority continues to intervene in the whole of the industry. We think that if the Government were fair dinkum about deregulation it would have said in this package of legislation that it would scrap the Prices Surveillance Authority. It sets maximum recommended wholesale prices for petroleum products which are uniform between capital cities. We believe that the way in which that price uniformity is set should be determined by the market-place. Of course, those of us who represent rural areas are concerned that the prices in our areas always seem to be so much higher than they are in the cities. Rarely do we see discounting in our parts of the world. We have seen the incredible circumstance on occasions when there has been a petrol price differential of 10c a litre between one end of my electorate to the other. That, of course, is partly because the New South Wales Government is levying absolutely ridiculously high excise charges whereas the benign Queensland Government is recognising the degree to which it is important that there be no additional surcharge on motorists. There are problems as far as the Prices Surveillance Authority is concerned. It would be a very good idea for the Government, if it is looking seriously at deregulation, to look at eliminating the Prices Surveillance Authority. A second part of the problem is the whole question of labour costs and the general circumstances that apply in the maintenance of the special relationship between the Australian Council of Trade Unions and the Government. Until the Government deregulates labour and the price of labour in Australia-deregulation in the oil industry, deregulation of the financial system or deregulation anywhere else-industry will be only partly effective. A particularly significant impact of deregulation is in relation to shipping. The imminent decline of Bass Strait oil production will result in less demand for coastal shipping and increased demand for ships carrying oil over longer distances. Under deregulation this process will be accelerated and in those changed circumstances it is important that we understand that the charges imposed on Australian flag vessels make their operation absolutely impossible. Their manning scales are too high and they operate in a closeted environment which makes them totally non-competitive. These things cannot be sustained. Unless that part of the industry is also deregulated, the costs to motorists and the cost of oil will continue to be far higher than they should be. Australian flag vessels must become internationally competitive or, in the view of the coalition parties, we will need to look at removing altogether the protection that is now given to them under the Flags Act. A deregulated oil market and the enforced use of high cost Australian vessels would certainly increase import prices and reduce export prices. Higher import prices will boost domestic inflation. Increased petrol prices will, of course, flow to consumers and overall they will reduce the international competitiveness of Australian industry with higher import charges. Moreover, effects such as these would not diminish over time because if Australian flag vessels were to receive a guaranteed share of the market, as is now required, their incentive to become internationally competitive would go altogether. These Bills reflect what those of us in the Liberal and National parties see as a worthwhile step towards deregulation. We are concerned about a number of aspects in the legislation. We are certainly concerned about the degree to which there seems to be an increase in the oil levy in the Excise Tariff Amendment Bill (No. 2). I am told that the long term effect of this will be an increase in the government take. As I have said, the increase is somewhere from 6c per litre to 21c per litre as at the mid-October 1987 date. The volware figure and the fact that there is a change from import parity pricing and the lifting of some assistance-the Bass Strait subsidy and so on-mean that there will be an impact on small producers. We are concerned that apparently they will get no more than words from the Government. Small producers are likely to be adversely affected. We are concerned about the long term effect of these changes on maintaining production from smaller wells and smaller oil fields as well as large ones, but above all we are concerned that as a result of the introduction of the resource rent tax (RRT) in the other part of this package the Government is providing a real disincentive for future exploration. Australia must find more oil. We must encourage exploration off-shore as well as on-shore and the RRT will be only a discouragement to those who are seeking oil off-shore. The Opposition does not oppose these two Bills. We look forward to further moves towards deregulation right across the whole of the Australian economy. Mr MARTIN(Macarthur)(5.06) —I address my remarks in this cognate debate to the Petroleum Excise (Prices) Bill. It is worth reflecting on the words of the Minister for Science and Small Business (Mr Barry Jones), who introduced this legislation, because in his second reading speech he succinctly summarised the purpose of this Bill. He said: This Bill provides for an effective and equitable system of collecting excise on crude oil production. It is a major component in the implementation of the Government's decision to deregulate the Australian crude oil market. That encapsulates perfectly the Government's view of this legislation and what it seeks to achieve. The House has already debated the Bass Strait Freight Adjustment Levy Collection Amendment Bill and the Bass Strait Freight Adjustment Trust Fund Amendment Bill which were a package of measures to enable the implementation of arrangements for the transition of marketing of Australian produced crude oil from a regulated to a deregulated or free market scheduled for 1 January 1988. These arrangements will be known as the Bass Strait freight adjustment scheme. It was my pleasure to talk on that package of legislation when it was debated in the House recently. I am also pleased to see that the honourable members who will debate the legislation before us today are in the House and will follow me in this debate. Obviously we will go over a lot of the same ground. I will try to be a little briefer than I was the other night and I suspect that other members will also be briefer. Some refiners will be underlifted against their Bass Strait allocation obligations as of 1 January 1988 and they will need to clear their underlift in 1988 before being permitted to purchase Bass Strait crude oil on the free market. Therefore, it is necessary to implement some transition arrangements to ensure equity between oil refiners. Moving from a regulated to a deregulated or free market is a complex process especially if one's priority in doing so is to maintain equity. This is certainly the priority of this Government. However, as is evidenced by the Petroleum Excise (Prices) Bill and the package of Bass Strait freight Bills, this Government is committed to a smooth transition from a regulated to a deregulated market and is attempting to accommodate the concerns of all involved. I was pleased to hear in the contribution made by the Leader of the National Party of Australia (Mr Sinclair) this afternoon that he acknowledged that the industry had been consulted upon the proposed changes in this legislation and was broadly in agreement with them. Again, this goes to the very heart of this Government's approach to legislation. It is one of consultation with the parties affected and of trying to come to terms with the concerns that they may express about the implications of legislation and endeavouring to meet those concerns. The Government's decision to move to a deregulated market arose out of a review of the present import parity pricing arrangements. It involved the State governments, producers and refiners, trade unions and consumers. Again, that follows from what I have just said about the process of consultation. Of course, we must remember that the present import parity pricing arrangements were put in place by a former conservative government. But I certainly acknowledge that they were maintained by this Government. The decision was based on a number of reasons. Firstly, we are running out of Bass Strait oil and, as we all recognise, production is slowing every year. In the absence of major new discoveries, this will mean a steady rise in the volume of imported crude oil. Thus, there will be a push from overseas markets for Australia to move to a free market. As I indicated in debate the other evening, it is my belief and that of the Government that it is best to move now and reap any benefits available and also to prepare our industry structure for that inevitable day when our Bass Strait oil reserves are exhausted. Secondly, in a deregulated market, the average Bass Strait crude oil prices could be expected initially to fall between $A1 and $A4. Even a fall of $2.50 a barrel would result in petrol prices falling by around 1.3c per litre. This Government is committed to passing on to consumers the full benefit of any crude oil price reductions. I am sure that that will have a great deal of appeal for the honourable member for Franklin (Mr Goodluck), who will follow in the debate tonight, because I know that he is one who is greatly concerned about petrol pricing policies in Australia, not just in Tasmania. I am hopeful that he will take notice of this particular part of the legislation. Thirdly, it is possible that positive balance of payments effects will flow from this decision. Under deregulation refiners could purchase different grades of imported crude oil suitable for their needs at a lower cost than current domestic prices. Our relatively high quality crude oil could be exported at a higher price than that of imports, resulting in a net balance of payments gain. Obviously this would represent a greater efficiency in the use of the nation's oil resources. Efficiency in the use of resources is particularly important when dealing with a resource which is, sadly, becoming depleted. Finally, the Government has received assurances from refiners that deregulation will not result in the closure of any Australian refinery and, further, that they will continue to lift the output of small producers in a timely manner and at fair market prices. This will ensure that small producers are not disadvantaged by deregulation and, of course importantly for all honourable members, that people who are working within the oil industry are not disadvantaged and perhaps thrown into unemployment. Specifically, this Bill fits into the Government's plan for deregulating the market by providing that the revenue flow to the Commonwealth is maintained through an excise system for crude oil based on prices achieved in a free market. The Minister for Primary Industries and Energy will have powers to determine the price to be used as the basis for crude oil excise and, in particular, to determine the volume weighted average of realised-that is, volware-prices for sales of Bass Strait crude oil. The final volware price for each month will be the final price basis for crude oil excise for that month. I also take this opportunity in the debate to indicate that the fact that the Government is moving to a freer or deregulated market in this particular area is not a sign that the Government is walking away from its commitment to provide a more efficient use of resources and pass on benefits to the general public. It is interesting, again, that the Leader of the National Party raised in his contribution this afternoon this whole question of public ownership of assets and so on and tried to bring into the consideration of that particular debate this question of the deregulation of the crude oil market. Let me say that this measure, in my view, is an example of how by making a freer market the consumer of Australia can benefit. Consumers will benefit in the future from our having a much more efficient allocation system and from our providing for exploration and improvements in the crude oil area. This is something which, in my view, should not be weighed down by any philosophical considerations. It is quite interesting to examine the financial impact of this particular Bill. The Leader of the National Party made some comment that there was a financial disincentive to the package of Bills that is being debated here. If one goes to the section dealing with the financial impact statement in the explanatory memorandum which accompanied the Petroleum Excise (Prices) Bill 1987, one sees that the financial impact of deregulating Australia's crude oil market will in fact be dependent upon the crude oil price movements in the free market. As I have indicated, in a deregulated market prices might be expected to fall by between $A1 and $A4. On the basis of taking an average of those two figures-something like $2.50 a barrel-the drop in government revenue in 1987-88 and 1988-89 is expected to be $100m and $168m respectively. This drop in government revenue will be passed on to the consumer. There will be no offset in product excise adjustment to recoup revenue forgone by the Government as a result of the drop in crude oil prices upon deregulation. So I just point that out to the Leader of the National Party and I hope that he takes that into consideration. In conclusion, let me just say that I concur entirely with the comments made by the Minister his second reading speech that this system that the Government is putting in place is both effective and equitable. It will lead to a real reduction in petrol prices, it will see something being passed on to the consumer and, as I have indicated in the debate, we have had a range of Bills in respect of the oil industry in Australia over the last few sessions. I believe the Government is approaching the matter in a very rational way. I certainly commend this package of Bills to the House. Mr SMITH(Bass)(5.18) —To pick up a point made by the honourable member for Macarthur (Mr Martin), these two Bills-the Excise Tariff Amendment Bill (No. 2) and the Petrol Excise (Prices) Bill-are the last in a whole series of Bills that will bring dramatic changes to the petroleum industry in this country. Indeed, all of us are hopeful that the consumer will be the end beneficiary, but that remains to be seen. I wish to talk about the Petroleum Excise (Prices) Bill 1987. As the Leader of the National Party of Australia (Mr Sinclair) has already said, this Bill enjoys the support of the Opposition. We broadly support the deregulation moves made by the Government within the oil industry. The deregulation of crude oil marketing on 1 January 1988 abolishes the old allocation scheme for crude oil and import parity pricing (IPP). I think the allocation scheme has been in place since about 1965. Thus, the import parity prices will no longer be used as the basis for allocated sales of domestic crude oil for the calculation of crude oil excise. This Bill provides the Minister for Primary Industries and Energy with the power to determine from 1 January firstly the prices to be used as the basis for crude oil excise and, in particular, to determine the volume weighted average of realised prices for sales of Bass Strait crude oil, described in the legislation as the volware system. The final volware price for each month will be the final price basis for crude oil excise for that particular month. That is a complicated set of provisions, but it needs to be put in perspective by looking at the background. Changes to the marketing arrangement for crude oil to apply from 1 January 1988 were announced in June 1987 by the then Minister for Resources and Energy, Senator Gareth Evans. The refiners and crude oil producers will be permitted to negotiate freely the quantities and prices of crude oil they buy and sell without government interference. We certainly welcome that. The deregulation decision was made on the basis of assurances from oil refiners that they would continue to lift the output of the very small producers in a timely manner and at fair market related prices. We hope that that will be the case. As the Leader of the National Party pointed out, and as I have pointed out previously when speaking on this type of legislation, the small producers are vulnerable. It remains to be seen how vulnerable they are. One would hope that their produce will be lifted and refined by the major refiners. The Government also claims that oil refiners also gave assurances that there would be no closures of refineries as a result of deregulation and that they would maintain their existing arrangement for Australian flag shipping. The new marketing arrangements require a change in the basis for calculating crude oil excises. Previously, the IPP was used for sales under domestic allocation arrangements while excise on exports was calculated on realised prices. From January a system based on the realised prices will be use for all crude oil existing calculations. That includes exports, as I understand it. The Minister for Science and Small Business (Mr Barry Jones), who is at the table, might like to clarify that point. As I said, calculating the prices is reasonably complicated. The Bill is directed towards oil production from Bass Strait as this is currently the only area producing oil attracting the excise. The Bill underlines the importance of Bass Strait oil production. Therein lies an interesting admission. We just heard the last speaker, the honourable member for Macarthur (Mr Martin), state that IPP had some benefits, that exploration was enhanced by the introduction of the IPP system and that the domestic production of oil also benefited by the introduction by the Fraser Government of IPP. Yet at the time that IPP was put into place we were subjected, whilst we were on the other side of the House, to unending vilification. Who did it come from? It came from the master of vilification techniques in this House, the Treasurer (Mr Keating) who on that occasion was the shadow Minister for minerals and energy. He sat at the feet of Rex Connor for many years. He probably learnt something. One thing he learnt was how to change his mind. He has changed his mind completely from the position he took then. I would like to put on the record several quotes from the Treasurer. In 1977 he said: Labor is determined to straighten out the (oil) industry once and for all so the Australian public will be better served with a more efficient, cheaper marketing system for petroleum. They are laudable sentiments. He went on to criticise the IPP mechanism. He said again in 1979: A Commonwealth Labor Government will break the nexus with the Fraser Government's import parity pricing policy so that Australian oil will be cheaper than the world price. That is what he said. But did the Government do it? It did not do it because when the then Opposition got to the treasury bench it saw the benefits of IPP. We applaud the move towards deregulation of the refining stage in crude oil but the Government must admit that we were right when we put that IPP mechanism into place. It was a difficult time for this country. We can argue until the cows come home whether the money ought to have been applied in the way that it was. In any event, it did have dramatic and important effects on exploration for the domestic scene both on-shore and off-shore. Explorers knew that if they found oil they would get a reasonable return for it because the price through the IPP mechanism guaranteed that. In 1979 the Treasurer said that `the great petrol rip-off must be curbed. Only Labor will stop this pernicious tax by stealth'. Also in 1979 we had the famous quote: Mr Fraser has virtually established a branch of the Australian Taxation Office at every petrol pump. Do not the realities of being in government bring it home to people how difficult it is and what is involved? Also in 1979, it was reported in the Age newspaper on 17 December: Petrol would be up to 30 per cent cheaper under a Labor government, Labor's energy spokesman Mr Keating said yesterday. The Treasurer learnt the lesson. It ought to be a lesson to all of us that this industry is a complicated one. It is not an easy one. It is not just an Australian industry; it is an international industry. There are many issues that need to be considered. The decision we took in this Parliament to put IPP into place was a decision that all of us must now, in retrospect, applaud. It was very interesting to hear, and we appreciated hearing, someone on that side of the House-in fact it was the last speaker, the honourable member for Macarthur-acknowledge that the Government continued with IPP and that there was some benefit there. The Australian public ought to realise that IPP was something from which the whole country benefited. The calculation of these prices under this legislation is complicated. The Bill underlines, as I said, the importance of Bass Strait oil. Its large fields, old and new oil, produce most of Australia's oil. However, the proportion of high excise old oil will decline as the oil fields deplete. Production from areas on-shore will attract the excise in the event that production exceeds the 30 million barrels excise free threshold. The price basis for existing such on-shore oil production will be considered at the appropriate time. There is some indication that there may be some changes on the 30 million barrels excise free threshold. Perhaps the Minister can elaborate on that point. Excise will be levied on crude oil from Bass Strait using the volume weighted average of realised free on board prices of all sales in a calendar month referred to, as I have said, as volware prices. The volume weighted average realised prices have been chosen because they are directly related to the prices actually realised by the producers. The basis for volware prices will be the realised price of oil as it is loaded on a ship at Long Island Point and Crib Point, and for pipeline transactions, the realised pipe inlet prices at Long Island Point. The Bill makes provision for the determination of three sets of prices for each month of sales. The Bill also has provisions to give the Minister the power to determine the price for any sale when any part of the sales transaction is believed not to be a genuine commercial sales transaction. That point, I think, is well made and we appreciate that. Unfortunately, we do not have much time today but I want to raise several points with the Minister. In his second reading speech he acknowledged the decline in Bass Strait production and the increase in the volume of imported crude oil. Without IPP, to go back to my earlier point, the importation of crude oil over the last several years would have been much higher than it was. Let us imagine what that would have done to our balance of payments if many of our hard earned export dollars had had to be applied to bringing oil in to run Australian industry. We have been so fortunate-we just do not realise how fortunate-because of the development of Bass Strait. According to the Treasury, Australian crude oil production is expected to fall from around 500,000 barrels a day in 1987-88 to around 300,000 barrels a day within three years and to around 200,000 barrels a day within six years. Crude oil self-sufficiency is likely to dive from the present level of about 90 per cent to less than half that amount by the mid-1990s. How then can the Minister also make the statement that as a consequence of deregulation: . . . some higher quality crude oil will be exported but this should be at higher prices than the imports, resulting in a net balance of payments gain. What time span is the Minister considering? An article in Australian Business recently suggested that an annual revenue gap of around $350m next year and between $700m and $1,100m in three and six years respectively could result. Even if the recent measures taken by the Government to stimulate oil exploration are successful-a matter for debate which we have discussed in here on many occasions in recent months-it will at best only cushion an otherwise abrupt landing. The Bulletin, on 27 October, predicted an annual import bill of $5,000m by the mid-1990s as Australia's crude oil self-sufficiency declines. We have to find that $5,000m. As the Minister at the table will know, it is no easy thing to replace oil with other forms of energy. For instance, whilst the technology for the conversion of natural gas to oil is there, it is not yet economically viable to apply it immediately to address the window of crisis that we face. The report of the National Institute of Economic and Industry Research issued a dire warning of the consequences of such a massive import bill on our balance of payments, our economy and employment. This was mentioned in a recent debate on the resource rent tax. Already the Minister for Science and Small Business will know that report because it was commissioned by the Victorian Government, which is also exceptionally concerned about the matter. It too draws revenue from the benefits of Bass Strait and it too, like the Federal Government, is wondering and hoping that the oil industry will continue on its happy way and will continue to be a tax vehicle. We on this side of the House say that governments of all persuasions, of all levels, have to try to move away from their over-reliance on taxation. Time is running on and does not permit me to address all the other issues I wanted to address. However, there is perhaps time to make one or two quick points. The Government has sought to protect small producers by seeking assurances from refiners that they would continue to lift the output of small producers in a timely manner and at fair market prices. The Government is apparently satisfied by responses by refiners that indicate that these conditions will be met. Indeed, it is interesting to pick out an article that appeared recently in the Australian Financial Review which mentions concern about condensate. The article refers to a Mr Craddock, who is the Assistant General Manager for Santos Ltd, and states: Mr Craddock's comments reflect current concern by the Cooper Basin producers that oil refiners, such as Mobil which operates the Port Stanvac refinery, could opt, in an era of deregulation, for cheap imports of crude and condensate rather than purchasing Australian products. The article goes on, however, to hope that that will not eventuate. But that makes the point: there is a fear there that because of the avail- ability of cheaper international crudes, oil refiners will take those up rather than take up the products of small producers. We hope that does not eventuate. I urge the Government to monitor that situation extremely closely because, as I said before, small explorers have the potential to become big explorers and big producers. We want to provide the incentive for domestic companies to be able to fulfil that ambition because we, the Australian public, and Australian investors-and it is a high risk industry-will be the beneficiaries. Another point made by the Leader of the National Party concerned the Prices Surveillance Authority (PSA). The Prices Surveillance Authority sets the wholesale price based on an average of capital city pricing. It is now being argued, and I accept the argument, that it will have to change that arrangement. Indeed-as I quoted from a letter from the Authority the last time I spoke-it is yet to determine exactly how that will be done, and there seems to be quite a deal of discussion about how it ought to be done. It seems to me that a line of logical thinking would demand that the PSA's role ought now to be somewhat changed. If we want to get away from the highs and troughs of the petrol price at the domestic pump, which the petrol stations suffer-and do not forget the wholesalers, who probably suffer more than the petrol station proprietors when the price goes down, when there is a price war, because they have to carry the bigger margin; although they have greater capacity, they too are in the business to try to make a profit-the PSA, in my view, would be far better to move away from setting prices and to have a role of monitoring only. If we are to have deregulation, let us go all the way. Indeed, if I can draw an analogy using interest rates, we kept the 13 per cent level of interest rates in the housing area-- Mr Price —Hear, hear! Mr SMITH —It is all right to say, `Hear, hear!', but some of us could not get it and missed out. It would seem to me that everyone ought to be treated in the same way. That is the situation in the oil industry. The Government is setting an artificial price. Once it has deregulated half way, up to the refining stage, what will happen to the other half? Is it going to regulate that? I think in time the inconsistency that is apparently there will have to be addressed by the Government, and I hope that it will look far more carefully at it. The PSA wrote to me again the other day and made the point-and I think it is a point well made-that in section 17 (3) of the Petroleum Excise (Prices) Act, part of its role is the need to maintain investment and employment, including the influence of profitability on investment and employment. It does have a role to ensure that there is investment in the industry and that the industry is profitable, whatever that industry is that is being looked at in terms of price surveillance. So let us not forget that the people in the oil industry who make it all happen are the companies that invest the money, and although many of them may be foreign nationals, many Australians are also investing cash in that industry. It is a high risk industry, especially on the exploration side. We want to do everything we can to ensure that exploration takes place in this country. We read in the Australian today that one of the products of deregulation may well be, according to Keith Orchison, from the Australian Petroleum Exploration Association, that exploration will suffer. He said: Small to medium producers, particularly in remote areas, would be worst hit because they would not be guaranteed markets. He goes on to talk about how the smaller explorers may be seeing incentive taken away from them. They are some of the issues that I think the Government has to come to grips with. Whilst we applaud the decision to move towards deregulation, it ought to be acknowledged that the Government has not gone all the way. There is still further work to be done, and it certainly revolves around what the PSA is going to do. Perhaps the Minister or other speakers in the debate will elucidate a little further on what the Government intends to do. Finally, I come back to the political point that I made. This legislation acknowledged the importance of a decision made by the former Fraser Government about import parity pricing. This Government has benefited from it. It followed IPP, as indeed has the whole Australian community. As we put the IPP mechanism to bed today, we ought to acknowledge the benefits that IPP, and the foresight of former governments, brought to the oil industry and to the Australian consumer in this country. Today ought to be the day when there is a bipartisan acknowledgment of the wisdom of that decision. Mr GOODLUCK(Franklin)(5.35) —I would like to compliment the previous speaker, the honourable member for Bass (Mr Smith), who again, and I repeat what I said the last time, put a lot of effort and research into his speech. I will confine my remarks specifically to what I see as some of the problems that may occur in the future in this industry. The motorists driving home tonight, particularly those in Tasmania, will be saying to themselves, `Boy, is something going to happen with this industry! Are we going to get a reduction? Are we going to get a fair go?'. Of course it is problematical. We have headed for deregulation. The honourable member for Bass supported the Government, as I do too. I was apprehensive about the introduction of import parity pricing, but of course in the long term we have to look ahead. There was a world shortage of oil and we needed future exploration and future production. We also needed to look for alternatives. It is good to see the Minister for Science and Small Business (Mr Barry Jones) in the chamber tonight, because I know that he is a gentleman who thinks about it. It is not easy to put these things into play. We talk about converting to liquefied petroleum gas (LPG) and we say to ourselves, `Let us make 25 per cent of the motor vehicles in Australia use LPG'. But if people do not want LPG, what can we do about it? We should have conserved more in that area. We should have introduced legislation at the time and made it mandatory for a percentage of cars to run on LPG. I spoke about this last time. I know that the then Minister for Transport, the honourable member for Shortland (Mr Peter Morris), made a Press statement indicating that he would look at the matter very seriously and, if possible, would endeavour to encourage people in Australia to convert to LPG. I said in my speech on the last occasion that one manufacturer produced a motor vehicle specifically to run on LPG, but it was a failure because he did not allow for the alternative, so that a person could use it either on petrol or on LPG. It used specifically LPG, and a lot of people shied away because of rumours that they could not get LPG at certain locations, and that it was unsafe. I think we need to look for alternatives if petrol is kept at such a high price. Let me refer to the case of a person travelling today from Bridgewater, a suburb of Hobart, to Hobart who may be on a low income and who may have the worst possible car. Most people buy a car, but those on lower incomes regrettably sometimes buy a poorer type of car, one that uses more petrol and more oil. If that person travels about 10 or 20 miles to work and then another 10 or 20 miles home tonight, it is costing him about $3. The point I make is that we often hear about the hip pocket, and the governments win or lose on the hip pocket nerve. But the price of petrol affects everybody. Tonight we are talking about the complex issue of deregulation, of getting away from import parity pricing et cetera. The average person in the street tolerated our going to import parity pricing for various reasons. The present Government has found it necessary to continue with that policy, because it knows it is a way of getting revenue. It is a simple way of extracting taxation at the petrol pump. We do not need to go over history. The Treasurer at the time said that it was stealth at the petrol pump, but he found it necessary to use the same system to keep up his Budget allocations. The motorists are saying to themselves, `All right, we have put up with import parity pricing. It went from about 15c a litre to about 45c a litre, and it was very hard to substantiate at the time'. But now they are saying to themselves, `Look, Mr Hawke said that he would reduce the price of petrol by 2c a litre. The Treasurer said that he would reduce it by 30 per cent'. People are still waiting patiently for it to happen. Since the Hawke Government came to power, regrettably the price has risen by 13c a litre on average throughout Australia. We are always hearing that the petrol price in Tasmania is the highest in Australia. We know that, but Mr Gray found it necessary-some of us doubted his wisdom, but it was his decision-to put up the price by 7c a litre because he said that there was a shortfall from the Federal Government. As a consequence the people of Hobart are paying about 64c a litre, and I think that people in Canberra will be paying around 60c a litre for petrol. It is a lot of money for petrol when people are already meeting mortgage repayments, payments on their car and so on. Petrol is a precious commodity. If we are able to make the position fairer for all Australians, we should give careful attention to the matter. It is said that there is a possibility that the price will go down by a certain percentage. I do not know whether that will be the case. The Prices Surveillance Authority has a grave responsibility. I know that the honourable member for Bass has written to that Authority, but I do not think that the Authority can handle the petroleum industry. It has answered the honourable member and I have heard his comments that the Authority said that it has to consider investment and so forth. The oil companies are very powerful. Previously each individual oil company went to the Prices Surveillance Authority, and if it could justify an increase it would get it. So there were different prices right throughout Australia at the maximum wholesale level. The position has changed. There is a common wholesale price right throughout Australia which does not vary very much from capital city to capital city. But then all hell broke loose, because if the oil companies found that they could sell more petrol in a certain locality, they dropped the price. An article in the Australian of 18 November, headed `Cargo price petrol plan attacked by Ampol chief', says: Ampol Ltd yesterday attacked proposals that Australia's maximum wholesale prices for petrol be based on cargo product prices in Singapore or other key refining centres. All oil companies have a different interpretation of how the maximum wholesale price should be fixed. The most interesting comment came from Esso Australia Ltd, and at least that company was truthful: An Esso Australia Ltd spokesman said the company would prefer not to have a maximum wholesale petrol price. `We never reach maximum price anyway, and we're usually at a discount of about 4c to 5c a litre . . . That is exactly what I have been saying for years and it has been substantiated by Esso that the company is able to drop the price below the maximum wholesale price when it finds it necessary to compete in the market place. We support free enterprise and letting market forces go free, but this aspect is so important to the average motorist. If motorists see the prices varying dramatically they are justified in becoming wild. People who leave Tasmania and drive around Australia, on their return tell me about the varying price of petrol discovered on their trips. It is extraordinary how the price varies from place to place. They say, `We can understand, Bruce, why prices should vary a little', but when the price varies by as much as 15c or 16c a litre or 12c, 5c, 6c and 7c, they start to ask questions. This is particularly true of the country areas. I see my good friend the honourable member for Gwydir (Mr Hunt) present for this debate. He did so much for the petroleum industry when he was Minister for Transport. People are justified in their complaints. Tonight we are debating the complexity of the oil industry and its future direction. Last year I read in the Petroleum Gazette an interesting article on restructuring. Following a world shortage of oil, problems started to occur, and the world was talking about restructuring. It was spoken about not just in Australia but throughout the world. We do not want a repetition of what happened before when Americans did not have enough oil to keep themselves warm. Suddenly there was a concentration on oil for heating, there was a shortage, and they could not keep up supplies. Mr Hunt —People died. Mr GOODLUCK —Yes, people died as a consequence. The world has restructured, and this has not happened in Australia alone. Let us hope that we can restructure for the betterment of the people who work in the petroleum industry and on the exploration side in the oil companies. Of course, the Prices Surveillance Authority said that it had to ensure that investment continued. One cannot knock the oil companies ad infinitum. They provide employment, they give grants and do many other things. One has to give those companies credit for those things. It is only on the marketing side where one sometimes thinks that the attitude is that everybody outside is just a number on the wall and that the poor service station proprietors will do what the companies want. They are just pawns in the game. As a consequence, sometimes the oil companies are condemned. I emphasise that we need to make the industry better for the people at the exploration level of the industry and for those who work in the oil companies. Then one has to consider the poor little blokes out there trying to make a buck in this cold hard world in service stations, who have their wives, daughters and sons working with them, and who have mortgaged their homes and so on. We want to make the position fair and decent for them. Then, very importantly, we want to make it fair for the consumers. If we can reduce the price genuinely, we need to do so. I say to the Minister at the table, the Minister for Science and Small Business, that we must forget stupid promises about reducing the price by 2c a litre to win votes. Let us forget claims that the price would be reduced by 30 per cent. Forget about those promises because we have not been able to come up with the goodies, and the people out there know it. Let us try to offset the actions of the State governments in imposing taxation. If they are forced to impose taxation to the level of 7c a litre, there must be something wrong. We need to make certain that such things do not occur. Hopefully we can restructure, and I feel that deregulation is going in the right direction. There is a hope that the price will come down and that more exploration will take place, which is all to the good. We in Australia might then be self-sufficient and not depend on oil imports. If that happens we might have a decent, respectable industry of which we can be proud, and thus help the motorists of Australia. Mr PRICE(Chifley)(5.47) —I wish to offer a small contribution to the debate on the Excise Tariff Amendment Bill (No. 2) and the Petroleum Excise (Prices) Bill and rather than going into the specifics of the Bills I wish to respond to a few comments made by Opposition members. The Opposition spokesman on science and energy, the honourable member for Bass (Mr Smith), suggested that one should acknowledge the imposition of world parity pricing by the Fraser Government. In the seven years in which that Government did so little that was geared to a sensible and rational economic structure in Australia, I agree that that probably was its single proudest moment. I am happy to acknowledge that in the long term it was a very important step. It was a step which undoubtedly had its electoral costs initially, but we can be thankful that it was taken. It is also fair to point to the irony that so many economic moves in building the Australian economy and industry and in providing jobs have come from the Labor side. Deregulation of the financial markets, for example, was begun by the coalition Government, but it was not really able to follow through. I know that there is debate now as to whether the present Leader of the Opposition (Mr Howard) was responsible for socking it to the Cabinet and Mr Fraser opposed it, or whether Mr Fraser was very keen about the matter and the Leader of the Opposition opposed it. One has to look at the matter with a sense of history, and I guess that it is not that important. Tonight we are dealing with a deregulation Bill. The Opposition supports this measure. I have taken part in a number of debates, prior to the election in July this year, dealing with industry assistance and customs and excise legislation. The basic feature of those debates was the degree of unanimity between the Opposition and the Government. I suppose that I can be accused of being a little naive, but I was genuinely shocked when the then Opposition shadow spokesman on industry, Senator Messner, brought out a policy which would dismantle every form of assistance to industry. I shall not recite the number of Opposition shadow spokesman and Opposition members who have spoken in this Parliament in support of assistance measures, even though they may have been critical of some aspects, which is the proper role for an Opposition. Then we went into an election and suddenly the Opposition made a complete turnaround. It intended to dismantle assistance but would do so in a consultative way. I hope that the Opposition's support tonight is not of that variety. I hope that it is genuine support, welcoming the Government's move to deregulate this industry. It is true that we could not have a Bill such as this, dealing with the petroleum industry, without a contribution from the honourable member for Franklin (Mr Goodluck)-- Mr Cobb —A great speech! Mr PRICE —The honourable member always makes an entertaining contribution. I wish to respond to a few of the points that he raised. For example, he talked about the 2c promise and the 30 per cent reduction that this Government had planned in petrol prices. Honourable members must understand that once one imposes world parity pricing, as introduced by the Opposition, this takes away some of one's options for reducing the price of petrol which rises and falls with the prevailing international price. That has happened with this Government. Additionally, I point out-and the Treasurer (Mr Keating) has made this point a number of times in the Parliament-that the Government which really reaped the windfall harvest of the Bass Strait discovery, the importance of which was so rightly pointed out by the shadow Minister, was the Fraser Government. That Government was awash with money. Did it apply that money to lowering the price of petrol? No. Did it apply it to a reduction in income tax? No. Did it apply it to some other worthwhile economic measure such as industry assistance? No, it did not. Unfortunately, once those opportunities are forgone, they are gone for ever. I wish to offer a personal and individual contribution to the debate. The honourable member for Franklin suggested that this industry is complex. I certainly accept that. It has its facets of exploration, export, refining and marketing. If we are ever to make a beneficial impact for our consumers at the petrol pump, we must act now. I am very mindful of those people from my electorate who travel home from Sydney's central business district to Blacktown and St Clair and who daily face the frustrations to which the honourable member for Franklin referred-that is, the complete volatility of and variation in petrol prices. Significant variations occur, not only within an electorate such as Chifley but also between different electorates such as Chifley and Banks. In Banks the petrol is much cheaper. Honourable members often stand up in this House and try to explain that this is private enterprise at work, that there are forces there that we cannot control or that there should be intervention by the Prices Surveillance Authority to correct the matter, but I suggest that that is not a fruitful course and it will not produce significant change. We really must take the bull by the horns. I suggest to the Minister that sooner or later the Government will have to look at divorcement-that is, restricting the ability of those who market petrol, the petrol companies, to own the retail outlets, the petrol service stations. If there is some apprehension about moving straight into this, I suggest that the Industries Assistance Commission (IAC), a body for which I have little time, could be employed productively in examining this proposition. There could be an investigation by the IAC into the wholesaling of petrol through further distributors, but in particular to the petrol stations, and the question of the ownership of those petrol stations. It is accepted wisdom today that in the metropolitan areas particularly we have far too many petrol stations. The problem is that we are allowing the petrol companies to rationalise those petrol stations and they are doing so against those small businessmen who have the least ability to respond-that is, the leaseholders. I have a real and genuine concern about the small businessmen who are leaseholders to petrol companies for their service stations. They have little ability for independent activity. They can only raise and lower their prices as agreed to by the petrol companies and they are in a completely subordinate position. It has come to my notice that petrol companies can be less than generous with such leaseholders. I say to those leaseholders that if they have a particular grievance or concern about the actions of petrol companies they may certainly write to me and I will take up the matter because I think it is an issue that is worth pursuing, that is, the divorcement between the big petroleum companies and their ability to own service stations and lease them out. I return briefly to the Bill. It has already been said that the Bill will deregulate the crude oil that is produced from Bass Strait. It implements a courageous decision by the Government to deregulate oil marketing within Australia with effect from 1 January 1988. I also point out that whilst companies now have the ability to export some Australian crude, it is expected that in export-import terms, this freeing up is likely to be either revenue neutral or perhaps even revenue positive. It also opens up some export opportunities for refined products, from Australia's sophisticated refineries, as pointed out in the second reading speech of the Minister for Science and Small Business (Mr Barry Jones). This is exactly what Australia needs. We really need to hook on more value-added to our exports and to be less reliant on crude exports, whether they be petroleum, minerals or whatever. I indicate that I support this legislation. I think it is important legislation. On the petrol retailing aspect, it is very true that all members on the Government side are concerned about price volatility and that government opportunities for reducing the cost of petrol probably came during the period of the Fraser Government when it was awash with money. If it did not choose to spend it on that, it could have chosen to spend it on other worthwhile purposes. But in the longer term, if we want to see consumers benefit on the retail side and if we want small businessmen to have a more certain and viable future, we ought to look at the policy of allowing petrol companies to own and lease out service stations. Mr COBB(Parkes)(5.58) —The debate this afternoon is on the Excise Tariff Amendment Bill (No. 2) and the Petroleum Excise (Prices) Bill. I want to direct most of my comments to this latter Bill. This Bill is concerned with deregulating the local crude oil prices so that import parity pricing will no longer be used to set prices of oil in Australia. In effect, this means that in the free market, Bass Strait crude oil prices could fall somewhere between $1 and $4 a barrel. When we take an average of these two prices, if Bass Strait crude oil fell by $2.50 a barrel, the price of petrol would go down at the pump by about 1.3c a litre. This would mean that in the coming financial year the Government would forgo revenue of about $100m and of about $168m in the following financial year. In the explanatory memorandum to this Bill the Government has said that there will be no offsetting excise adjustment for this forgoing of revenue. This is a commitment that the National and Liberal parties will be watching very carefully because the Government's record has not been very good in the past on the commitments it has given. In the lead-up to the last Federal election someone calculated that the Prime Minister (Mr Hawke) had broken 130 promises. When he said that there would be no early election, that was the 130th promise that was broken. Let us go back to the very first promise he broke in the lead-up to the 1983 election. In a Press statement on 9 February he said: Petrol prices will be immediately cut by about 3c per litre under a Federal Labor government. We all know what happened. Labor won the election and petrol prices immediately went up by about 3c per litre. When Labor took over in March 1983 the excise tax on petrol at the pump was 6.155c per litre. Today it has more than tripled to 20.83c per litre. This increasing excise on petrol is highly inflationary, certainly in a direct sense, because when the price of petrol goes up it impacts directly on the consumer price index. It also has many indirect effects. For example, it forces up freight costs. People who live in country areas such as those in my electorate of Parkes would certainly be aware of that. The price of goods is forced up vis-a-vis the price of city goods. The cost of production is also forced up. Wheat farmers, for example, who drive around paddocks in circles on their tractors know that the cost of planting a three-bag crop is the same as the cost of planting a 13-bag crop. Even though they get some relief in regard to the diesel fuel excise they still have to pay the other oil taxes which force up the cost of fuel. There are also many indirect off-road costs. This is felt in industries such as the dry-cleaning industry, the brickworks industry and the abattoir industry, which are screaming out for excise relief, particularly since excise charges, as I have said, have more than tripled from 6c a litre to 20c a litre in the four short years this Government has been in power. Mr Peter Fisher —And tourism. Mr COBB —The tourism industry is also being crippled by fuel charges. A very small abattoir in my electorate, the Scott abattoir in Coonamble, which employs about 35 people, kills about 400 head of cattle a week. The excise tax that it pays on its diesel fuel alone can force up killing charges by about $10 a beast, which is almost incredible. Diesel is a very big cost for the abattoir, particularly because of the excise tax on diesel, which is about 21c a litre. Such taxes stifle incentive and initiative. This has meant that the abattoir does not bother to expand. It will not take any risks. It is not seeking new markets because the profit is not there at the end of the day. It will not invest more capital or put more men on, which is something we desperately need in the bush-more employment. If the Government would give some relief to these off-road users of diesel, it would secure enterprises such as the Scott abattoir, which could expand its business, increase production and help get Australia's economy, which is very sick these days, back on its feet. Oil and fuel taxes will return the Government in excess of $7 billion in the coming financial year, about 10 per cent of total Government revenue. When the Treasurer (Mr Keating) was shadow Minister for minerals and energy he said, on 30 October 1979: The great petrol rip-off must be curbed. Only Labor will stop this pernicious tax by stealth. . . Mr Fraser has virtually established a branch of the Australian Taxation Office at every petrol pump. When the average motorist driving home in my electorate of Parkes, whether in Forbes, Parkes, Dubbo or distant towns like Bourke or Wanaaring, filled up in 1983 he was paying the Treasurer about $3 a tank. Today he is paying this Treasurer, who made the statements I have just read out, about $11 in tax for each tank. If a worker filled his petrol tank only about once a week, he would be paying the Government in excess of $500 a year in petrol tax alone just to get to work in towns like Dubbo, Forbes or the big cities of Australia like Sydney and Melbourne. The blatant, cynical and money grabbing action of the Treasurer does not sit well with the earlier statements he made. A question that has been asked in this debate is why we have different petrol prices in different parts of Australia, whether they be from week to week in our cities and towns, or in city and country areas. It puzzles many people. It is a very complicated issue. The ownership of outlets is one thing that complicates the issue. In country areas such as in my electorate we can pay up to 65c a litre, particularly in distant towns like Nyngan and Brewarrina, for petrol and perhaps around 61c, 62c or 63c a litre in Dubbo. At the same time specials can be running in Sydney of 49c a litre. A gap of 15c a litre means that people in the country will pay more than $9 extra for a tank of petrol than their city cousins. When one lives in the country and has to travel greater distances than people in the city anyhow this is a bit hard to stomach. People in the country will always have to pay slightly higher prices for petrol because country outlets sell less petrol and to not have the economy of scale city outlets have. There is also a freight charge. But even the freight cost to get petrol, say, from Sydney to Dubbo, works out to only 2.7c a litre. Country outlets never seem to get the specials. To understand this we have to realise that there are four main types of petrol retailers in Australia. There are the independents, who own their own service stations, the secondary marketers, such as Solo, the commission agents who run company-owned stations, and the lessees who lease stations from the oil companies. Both the independents and the secondary marketers are able to buy their petrol, particularly cheap petrol on the open market, from the refiners. They can do their own wheelings and dealings and get special prices. However, the commission agents and lessees, who are in the majority in this country, are tied to the oil companies for the prices they can get their petrol for. The commission agents do not actually buy the fuel. They simply sell it on behalf of the oil company for a commission. The lessee dealers buy their fuel from the company at a price determined by the company and then put their mark-up on it. The discounting that occurs in this country starts when an independent or secondary marketer manages to buy some cheap fuel and then marks his price down. Because the price of retail petrol in this country is so sensitive, the volumes that are sold can shift very rapidly from those charging the standard price to those charging a discount price. So we get discount pricing. Oil companies, on average, get about 12 1/2c per litre for each litre they sell. They will sometimes mark this price down to 2 1/2c a litre, which is a 10c reduction. The retailer will have a mark-up when he or she sells petrol of about 4c a litre in the city to about 6 1/4 a litre in the country. They can sometimes mark the price down to 3c a litre. If one combines the two, petrol can be sold at one bowser for 58c a litre and at another bowser can be on special for 47c a litre, which is quite a difference. It is worth while remembering that Government taxes remain the same, regardless of whether the petrol is sold at the standard price or at a discounted price. The taxes, excise and royalties on petrol amount to something like 34c a litre in total. Mr Lloyd —How much? Mr COBB —Some 34c a litre, which, when petrol is selling at 58c a litre, is something like 58.6 per cent of the price; but when petrol is marked down to 47c a litre the taxes are in excess of 72 per cent of the total price. So with the tax on oil producers and oil refiners as well as the excise, and Federal governments are bleeding dry the industry and the motorists in this country. An industry that should be encouraged is being taxed out of existence. The Government should make hard decisions to get off the backs of the high risk, high cost oil industry. I seek leave to incorporate in Hansard a table setting out the oil wells drilled in Australia from 1970 to 1986. Leave granted. The table read as follows- WELLS DRILLED-AUSTRALIA 1970-86 Wells drilled Year Exploration Onshore Offshore Sub- total Development Onshore Offshore Sub- total Totals For year Cumulative To 1970 ... 1,396 87 1,483 768 59 827 - 2,310 1971 ... 54 18 72 4 18 22 94 2,404 1972 ... 62 38 100 21 12 33 133 2,537 1973 ... 29 31 60 5 6 11 71 2,608 1974 ... 20 31 51 8 - 8 59 2,667 1975 ... 6 19 25 4 - 4 29 2,696 1976 ... 16 3 19 13 - 13 32 2,728 1977 ... 8 13 21 18 2 20 41 2,769 1978 ... 33 22 55 24 13 37 92 2,861 1979 ... 31 21 52 48 9 57 109 2,970 1980 ... 77 17 94 26 7 33 127 3,097 1981 ... 142 16 158 41 14 55 213 3,310 1982 ... 177 44 221 95 13 108 329 3,639 1983 ... 160 49 209 40 26 66 275 3,914 1984 ... 221 43 264 71 38 109 373 4,287 1985 ... 227 43 270 76 18 94 364 4,651 1986* ... 112 28 140 15 20 35 175 4,826 * Preliminary figures subject to revision Mr COBB —The table illustrates how exploration activity fell off around the time of the Whitlam Government in 1975 and is falling off again today. There is a great risk in drilling wild-cat wells in this country. They should be encouraged. They have a success rate of about 25 per cent. Wildcat wells that are being drilled off-shore have only about a 5 per cent success rate. Bass Strait has reached peak production and will now start to decline. The Jabiru and Challis fields are not the bonanza that it was originally thought they would be; and in 1984 it was calculated that Australia would have 95 per cent oil self-sufficiency in 1990. This year, that has been revised down to 65 per cent. The cost of imports today is approaching $3,000m. Governments, both State and Federal, must wean themselves from oil taxes. If they do not do so, that position will be forced on them anyhow. In conclusion, the sooner we move towards getting fuel prices down, via reducing the massive taxes in this area, the better. This is especially so for those wealth producers in Australia who use large amounts of fuel. Mr IAN CAMERON(Maranoa)(6.12) —The Excise Tariff Amendment Bill (No. 2) and the Petroleum Excise (Prices) Bill are important to the taxpayers of Australia. The tax to be collected is large. I did not support either of my own past government's parity pricing arrangements, nor do I support the present Government's taxing regime. I do not believe oil producers ought to pay any tax at wellhead. Governments can collect more than enough taxation at the petrol pump, without imposing a regressive tax at the point of production. Of course, we have seen nothing but hungry, grabbing governments with their hands in the oil barrel ever since oil was discovered in this country. Initially, governments gave exploration companies a dollar for dollar subsidy. This product is very important to Australia, which is a very isolated large island. We have been nearly self-sufficient. If we continue to tax oil companies at the rate at which they are currently taxed, we will no longer remain so self-sufficient in oil product. Unfortunately for us, the Arabian oil countries have brought recession upon the world at long last. It has taken them about eight years, since 1978, when they jacked up the price of oil to unbelievable heights because they felt that they were being badly treated by the international oil companies. They wanted more of the money for themselves, and they got that. We then followed suit. We did not seem to think that what they were doing was anything peculiar and would affect us. We were hungry at the time and needed the tax revenue, so we put our hands into the till and started raking out billions of oil company dollars; and since that time the world has stayed in recession. It is now going into depression, and that was brought about initially by the Arabian countries. The Bills before the House tonight continue that regime. This year the Labor Government will raise $2.2 billion by this excise tax. The new taxing arrangements that replace the old parity pricing arrangement will apply only to fields that produce 30 million barrels of crude oil per year. The only field that does that is the Bass Strait oilfield and it will pay this new tax. The Jackson oil field in my electorate of Maranoa and the Cooper Basin had the only on-shore field that was paying this tax, but it is not now producing enough crude oil to be eligible to pay the tax, so Bass Strait will be the only field in respect of which this tax will be paid. It will be based on an average of the export price. Those producers are large exporters: up to $2 billion worth of crude oil a year is being exported from Australia, and that is a dangerous situation for us, because that is only helping to run down our stocks. However, if we are going to go to the free market, we have to accept the consequences of selling a lot of our product because, in the long run, if we do not encourage companies to find new product, we will have to import large volumes at great cost to our balance of payments; and honourable members do not need me to tell them about the precarious position we are currently in. We are now looking at a debt of up to $13 billion a year in our export balance. If we run out of oil, we will have to import again-not just the heavy crudes that we have to import anyway, but also the light crudes which Bass Strait produces; and we will face the situation we were in in the 1960s of paying something like $3.5 billion a year and, therefore, raising our balance of payments deficit to anything up to $15 billion or $16 billion a year. So it is critical for us as a nation to encourage anybody in the oil industry to explore for more product. The great stock market crash of three weeks ago will exacerbate the position of the oil companies. Most of them will fall away to the penny dreadful stage again, which they were at back in the 1960s, and they will not be able to raise capital. There has been an increase in exploration, particularly on-shore, in the last 12 or 18 months because the stock market has been brisk. Every company that one likes to mention, particularly in the Cooper Basin in my elector- ate, has been out drilling for oil because it has been able to raise the capital to do so, but that will not continue. Those companies will end up drilling at costs of anything up to $3m a hole and they will not be able to find the capital to do that. In the brief time left to me, I shall quickly run through a few figures that I have regarding the sort of revenue that will result from this change to a newer type of tax. Since 1978, when import parity pricing for all locally produced oil was introduced, the governments of this nation have raised $27 billion in crude oil excise. That is $27 billion that I have always argued ought to have been left with the oil companies to enable them to discover new product. Governments can take more than enough tax by way of company tax, personal tax, pay as you earn taxation, excise tax and every other type of tax that one likes to mention, without burdening them with this sort of tax at wellhead which, as I mentioned, will raise another $2.2 billion in tax. In the last five years of the Fraser Government's term, it raised $13.3 billion in crude oil excise. In four years, the Hawke Government has raised $13.9 billion; so in four years the Hawke Government has raised more than the Fraser Government raised in five years, and that does not include this year's figure. Of the excise which is raised at the petrol pump, and which we pay every time we fill our tank with petrol, 60 per cent goes to governments, either State or Federal. Most of it comes to the Federal coffers. In its last five years the Fraser Government raised $5m by way of petroleum excise, whereas in four years the Hawke Labor Government has raised $11.7 billion from that source with another $4.8 billion estimated to be raised in the current financial year. So the Labor Government will have raised nearly as much excise at the petrol pump in one year as the Fraser Government did in the last five years of its reign. That gives honourable members a good indication of the sort of taxing regime now operating; and all we are seeing in the whole exercise is the movement from taxing at wellhead to taxing at the petrol pump and, in fact, governments taking more revenue out of the oil industry today than ever before. Mr BARRY JONES(Lalor-Minister for Science and Small Business)(6.20) —in reply-I thank honourable members for their contributions to the debate, particularly those who have co-operated with the time constraints. I agree that there are dangers in dangling absolute figures in fuel pricing, promising a fall of so many per cent or so many cents per litre, and then appearing not to deliver. But a strong case can be put that, notwithstanding the need to impose fuel tax as a major contribution to revenue, something that the Opposition recognised when it was in government and that we recognise in office, Australian fuel prices at the pump have been kept at very low levels comparatively internationally. I know that this is not of much consolation to the consumers in the electorate of Maranoa and in the electorate of Bass, but it needs to be recognised. In looking at some kind of international standing, we obtain some comparative data as to whether consumers here are doing well. I have often told the House this, but this is the first time in the Thirty-fifth Parliament. I seek leave to incorporate in Hansard a table setting out indicative international retail prices for Organisation for Economic Co-operation and Development (OECD) members and other countries. Leave granted. The document read as follows- MAJOR ENERGY STATISTICS, ISSUE NO. 81, OCTOBER 1987 TABLE 8 INDICATIVE INTERNATIONAL RETAIL PRICES (Australian cents per litre) Automotive gasolene Automotive diesel oil OECD- Australia ... 55 53 Austria ... 99 59 Canada ... 49 49 Federal Republic of Germany ... 81 68 France ... 111 69 Greece ... 78 38 Italy ... 136 68 Japan ... 119 70 Netherlands ... 114 62 New Zealand ... 84 63 Norway ... 102 32 Spain ... 95 70 Sweden ... 96 57 Turkey ... 42 42 United Kingdom ... 87 80 United States ... 44 42 Other- Argentina ... 50 20 Brazil ... 31 11 Egypt ... 19 3 India ... 80 38 Indonesia ... 33 17 Kuwait ... 20 20 Malaysia ... 52 26 Malta ... 103 63 Nigeria ... 13 9 Philippines ... 48 33 Saudi Arabia ... 13 4 Singapore ... 63 24 South Africa ... 51 51 USSR ... 65 65 Mr BARRY JONES —The Australian figure in that table was 55c for automotive gasolene and 53c for diesel oil. In Norway, a large oil producer, automotive gasolene was 102c per litre in Australian currency. Argentina and Brazil were much cheaper: 50c for automotive gasolene in Argentina and 31c for Brazil. In the figures for OECD countries Australia is towards the bottom of the table, comparatively speaking. This may be of some consolation to constituents of honourable members. I am attempting to put the case fairly. In the few minutes that remain I wish to respond to points made, especially by the Leader of the National Party (Mr Sinclair), who wanted answers to questions, but is not now gracing us with his presence, and the honourable member for Bass, who is. Mr Lloyd —His deputy is here. Mr BARRY JONES —That is all right. Contrary to the right honourable member's suggestion that the proposed regime in this legislation will not provide any incentive for further petroleum exploration and development in Australia, as a result of the new taxation arrangements given effect to in the Excise Tariff Amendment Bill (No. 2), there are very significant commitments from the Bass Strait producers in return for concessions granted. Esso Australia Ltd expects to undertake an active exploration effort in Australia to define and evaluate economically viable prospects subject to acreage availability, joint venture concurrence and adequate oil prices. They expect that, under favourable conditions, their exploration expenditures will be $300m during the five years to 1992, including more than 100 wells in Delhi's Cooper-Eromanga permits. The Broken Hill Proprietary Co. Ltd anticipates, subject to reasonable oil prices and exploration partner concurrence, spending up to $300m on petroleum exploration activities in the next five years. So the result is that the situation looks pretty good. The Leader of the National Party made the point that the Petroleum Excise (Prices) Bill should ensure that the highest bid is accepted for any oil sold by the producers. The answer to that is that the Bill is solely for the purpose of establishing the price basis for the collection of excise. It does not seek to specify the prices at which producers can sell their oil; that would be counter to the concept of deregulation. We on this side of the chamber really believe in capitalism, unlike your mob, the rural socialists from Queensland. Mr Smith —Things are changing there too! Mr BARRY JONES —I cannot wait to hear the news. It would therefore be inappropriate to seek through this Bill that producers must sell their oil to the highest bidder or to any other buyer. It is a matter for the producers' commercial judgment as to whom they sell to and at what price. The honourable member for Bass directed some of his comments towards the exemptions from excise of the first 30 million barrels of crude oil produced, and sought a clarification of this particular measure. There are exemptions for on-shore fields, that is, for oil fields within the States and Territories and areas off-shore out to the limits of the territorial sea. A crude oil excise exemption applies to the first 30 million barrels of stabilised crude oil produced from each on-shore field, regardless of when it came into production. To be eligible for the excise exemption, the crude oil production must come from a naturally discrete accumulation. On the basis of experience to date, all but the very largest on-shore fields currently in production are likely to be exempt from crude oil excise in the future. For off-shore fields, that is, for fields in the North West Shelf and Bass Strait areas, a crude oil excise exemption applies to the first 30 million barrels of stabilised crude oil produced from new off-shore projects. Each off-shore field coming into production for the first time after 30 June 1987 will be eligible for a 30 million barrel excise exempt quota. In the case of a field already in production before 1 July 1987, a significant new development project, involving the recovery of additional crude oil which would not otherwise have been recovered from existing facilities, will also be eligible for a 30 million barrel excise exemption for the additional oil recovered. All off-shore regions other than those specified above are subject to the resource rent tax arrangements and excise, and royalties do not apply. I thank the honourable members for their contributions, and I am sorry that time really does not allow me to answer them in any detail. I commend the Bill to the House. Question resolved in the affirmative. Bill read a second time. Leave granted for third reading to be moved forthwith. Bill (on motion by Mr Barry Jones) read a third time. Consideration resumed from 18 November, on motion by Mr Peter Morris: 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. Bill (on motion by Mr Barry Jones) read a third time. Sitting suspended from 6.28 to 8 p.m. Debate resumed from 4 November, on motion by Mr Peter Morris: That the Bill be now read a second time. Mr LLOYD(Murray)(8.00) —As the member for Murray I very much appreciate the terminology when speaking to the River Murray Waters Amendment Bill 1987. The River Murray is important to all Australians. It is supremely important to those who live along the river. They have a great feeling of responsibility and love for the river, the river system and the area. They, above all Australians, are anxious that the necessary remedial works which, if acknowledged have to be done to improve further the quality of the river, will be done. They recognise and we also must recognise the need to overcome the climatic and geological problems which add to the difficulty of improving the river system to the degree that all of us would like. The Murray is our greatest river system. The Murray-Darling Basin is the core of agricultural production in Australia. That area is the heartland of agriculture in its finest forms in this country. The Murray is the provider of irrigation water for the preponderant irrigation areas of Australia. Irrigation agriculture is very important and it is becoming increasingly so with our need to increase exports. The Murray is also a very important source of water supply. Adelaide is the largest city which it supplies but it also supplies many significant cities, towns and industries along its banks. The Murray is a very important recreation area. At the present time there is very rapid growth of tourist facilities of both national and international significance. At this stage I will comment on some fallacious views of the Murray that some people have which, I believe, makes it difficult for them to understand the reality of the river, the problems and the way in which the people living along the river have responded. It is only by having a better understanding of the real situation that we can arrive at the best solutions possible. The first important point to make is that the Murray downstream in South Australia has never been a pristine, pure stream of water. Well before there was any settlement or irrigation, over half of the salt load that now goes into the Murray has always gone into it simply because of the geology of the area. There has always been silt and clay in suspension going down the river as well. The geology of the Mallee area, which is the most significant area in New South Wales, Victoria and South Australia through which the Murray flows, is saline. That means that there is salt in the river and this has come naturally but has been exacerbated by irrigation. The second point I make is that the Murray is not always a majestically flowing river. My understanding is that the 1914 original agreement for the Murray came largely as a result of the fact that the river stopped flowing completely during the drought of 1910 to 1912. Without the assistance of the Hume Weir and other weirs, the river has stopped, and will stop, flowing at various times. The third point I make is that many of the lakes or lunettes in the Mallee area have always been salty; it is not just a matter of irrigation making them salty. The fourth point is that one reads that production is down by about $200m on what its optimum production rate could be, and I do not disagree with that. But people then take it that production value is falling from the irrigation areas of the Murray, and that is rot. The volume and value of production of irrigated agriculture right along the Murray is increasing at an accelerated rate every year. The final point is that somehow or other the system continues to deteriorate. I have represented the Kerang area, which is part of the area that has had difficulties with irrigation. Whenever I drive through that area, as I do frequently, I have a feeling of pride for the work that has been done by the irrigation farmers of that area to improve the irrigation and the land management and to overcome the problems that were exacerbated in the early years of irrigation. We move now to the stage where work was done to control the flow of the river. The Hume Weir was the first reason for the River Murray Agreement and that overcame the flow problem. Irrigation came afterwards. In areas west of Echuca-some would say west of a little further down the river-because of the geology and the saline history of the the areas we had drainage problems. There was increased drainage into the Murray and that, in turn, increased the salinity. Over a period of years other pollution has increased simply because of increased habitation-industrial, agricultural, tourists and so forth. The deteriorating situation-the low flows and the saline concentration-was exacerbated by the drought of 1967. I here make a distinction between saline concentration and the tonnage of salt in the river. In years of low flow-drought years-the percentage of salt in the river increases, and one form of measurement is electric conductivity (EC) units. But is years of good flow-the wetter years-the concentration falls but the actual tonnage of salt increases as part of the increased total flow of the river. All of this came to a head with the realisation that something had to be done and the pioneering or landmark work of Gutterige, Haskins and Davey started in 1967. I dusted off the report because I believe that it is a very important one for anybody who lives along the Murray or has a feeling for it. Mr Braithwaite —Dust in suspension. Mr LLOYD —Yes, rather than solution. Since then the works that had taken place along the Murray became particularly apparent in the 1982 drought when the maximum salt concentration at Morgan-it is the key point; it is where water is diverted to Adelaide-was kept at a manageable level. In other words, we were starting to win the battle against the concentration of salt in the river. Everyone along the Murray acknowledges that continual improvement is necessary. We are winning the battle but a lot more is required to be done. The salt interception work-the work that has been done since this realisation-has reduced the number of EC units at Morgan by about 90. That is a significant figure because 800 EC units at Morgan is a key figure as to whether the river is at an acceptable international standard. The coalition Government, through its national water program and its assistance measures of providing funding on a dollar for dollar basis with the States, was the major reason that those works improved the situation from the late 1960s through to when the coalition lost office, at the time of the 1982 drought. However, the coalition Government was increasingly frustrated by the slow progress of some of the States, because this was a federalist co-operative arrangement between the three States of New South Wales, South Australian and Victoria plus the Commonwealth. On a dollar for dollar basis, we believed that the States were not acting urgently enough in light of what could be and should be done. This is why the Fraser-Anthony Government initiated the bicentennial water program. Over a period of years, $640m of Commonwealth money was to be provided because of this frustration of waiting for the States to play their part. A number of valuable works which would have improved the situation in the Murray were planned, including the Mallee pipeline. Of course, when the Australian Labor Party came to power it dropped that bicentennial program. Mr Peter Fisher —That was $65m. Mr LLOYD —As the honourable member for Mallee says, that was $65m. Also as part of the improvements that were occurring, the irrigation farmers and the research workers were gaining a greater understanding of irrigation, drainage and water-tables. There was also a dramatic increase in the horsepower of tractors and scrapers, and the dollar cost of that horsepower, to allow better land formation to take place to irrigate more efficiently and reduce first of all the drainage off the farms-I speak now as a lifetime irrigation farmer in the area-and also what goes down through the soil, which can raise the water-table to the dangerous levels, as has occurred in some areas. In particular, there was the introductions of laser technology. The people of the area have been world leaders in this field of technology. There was also the introduction by the coalition Government of section 75d of the Income Tax Assessment Act which provided for tax deductibility for this laser technology that have been and is being so successfully used to improve the irrigation and drainage practices and so forth in that area. There were also many other issues at that time such as a better understanding of the flows of the river for flushing, management of weirs, et cetera. Of particular concern, both then and now, are the great red gum forests. I believe that the Barmah red gum forest in my area is the greatest red gum forest in the world. My compatriot across the river might believe that the Millewa forest is the greatest. But, in any event, these are the great red gum forests of the world. There is the problem of the Barmah choke and the flows that are necessary along the river to make sure that Adelaide and the irrigation areas get the water. This could mean the flooding of the red gum forests at the wrong time of the year. I want to make the point that there is this great concern for the protection of the red gum forests in my area, and there is an acknowledgment that, if special allocations of water are needed to guarantee that those red gums are flooded at the right time of the year in the very dry years, that should be done. Together with that there is the issue of the protection and encouragement of the great ibis rookeries of the area, which are very important not just for the quality of life but also for agriculture itself. I also make a claim for a second type of forest. When we are talking about the Murray-Darling Basin, we are talking about the home of the Murray pine. The largest Murray pine forest in Australia also happens to be in the electorate of Murray, at Mitiamo. That is not necessarily saying much; it is not a very large forest. However, I make a plea on this matter. In all of our talks about conservation we have not done enough to ensure the protection of the whole range of Murray pines. Mr Braithwaite —Does it want a World Herit- age listing? Mr LLOYD —No, we do not need a World Heritage listing; we just need a better understanding and priority to ensure that the growth of the Murray pine is encouraged, because it is also a great timber for housing, et cetera. In addition to these issues there was increasing industrial pollution and increasing tourism. That meant that in the early 1980s not only was the question of water quantity important-the control of the river and its diversion between the three States-but also water quality became very important. There were amendments at that time to give far greater power to the River Murray Commission for water quality within the river itself and an advisory role for water quality for the tributaries coming into it from the States. The States continued to remind us that they are sovereign in respect of the tributary rivers to the Murray, and hence the Commission could be advisory only. Through all of this there was this great determination of the people living along the river and in the basin generally to improve the situation. Also, I might say, the River Murray Commission enjoyed then and enjoys now a very high reputation. In fact, the reputation of the River Murray Commission along the river to my knowledge is higher than that of any State government, because it is seen to have had concern for the future of the river, which is more than can be said of some of the State governments at various times. I now want to refer to some of the attitudes of people who do not know the river or the area or irrigation water use. Some people promote the idea that irrigation farmers have been careless with the application of water, that they have almost been criminal with it, and that the practices of the 1930s and the 1940s are still being cited as if they were still the practice of irrigation farmers today. I want to say again that the value of irrigation agriculture is increasing rapidly. There have been quantum leaps in technology in recent times which not only will add to the value of production from the area, but also reduce water usage and therefore the drainage problem. I refer to laser technology and drip irrigation in particular. Flood irrigation for pasture production, principally for dairying, is one of the major uses of irrigation water, certainly in my part of the Murray system. Looking at dairying in this area, the productivity per farmer is two to three times that of Europe or the United States of America. It is up with the best in the world, meaning the Waikato in New Zealand. There have been bottlenecks or restrictions on increased productivity in dairying in that area. There were three in particular. One was the question of how one man could handle large amounts of hay. The answer came in the packaging or palleting system with the big round bales. The next problem was how one man could milk an increasing number of cows. The answer came with automatic cup removers, herringbones and rotary dairies. The third problem was how one man could handle a certain area of irrigation, which meant working seven days a week and all hours of the day and night. People tend to forget this. The answer to this came with lasering and automatic watering systems. In horticulture there are tremendous opportunities for new exports. It could be table grapes from the Mildura area or wine from the same area and down the river in the Riverland. It could be citrus fruits or pears, including Asian pears or nashi pears from my area, tomatoes, et cetera. These horticulturalists have now reduced their water usage so much by drip irrigation that, once the transferability of water rights becomes possible in Victoria, they will be selling off a good percentage of their water rights. This indicates the progress that is being made. What worries me particularly is that in some quarters now, instead of encouragement to improve further the efficiency of water usage, some people are suggesting penalty systems. These include trebling the price of water, instead of working with the irrigation industry through taxation incentives, loans, technology, et cetera. They think that somehow or other just applying the price mechanism will further increase water efficiency. I believe that is an ignorant and unfair attitude. It is counter-productive, because it first of all ignores the improvements that have been taking place in the system. Secondly, and more importantly, such a system would reduce cash flow to the individual irrigation farmer and his ability to finance the new technology which in turn would further increase the efficiency and reduce the water requirement, the drainage and so forth. Also, these people feel that they have been unfairly singled out by the double standards of State governments. The talk about cost recovery means including the capital works for irrigation. With railways, particularly suburban commuter railways, one is lucky to get 35 per cent cost recovery. Yet somehow or other irrigation farmers are expected to have 100 per cent cost recovery applied. One could go on with many other examples. If there is to be a price mechanism or a financial penalty to encourage more efficient irrigation, the answer is to put it on drainage, because it is drainage which causes the problems. In regard to primary industry, I last had a role here as parliamentary secretary to Peter Nixon, and I spent some time in Washington and elsewhere in the United States of America studying irrigation and drainage. I have spent some periods over many years in the Platte Valley in Nebraska, the Imperial Valley, the San Joaquin, the Central Valley and the Sacramento Valley of California, and the Moses Lake area in Washington State that is watered from the great dams of the Columbia River. I am therefore familiar with some of the major irrigation areas of the United States. It was argued there that if price mechanisms are used to increase irrigation efficiency or for any particularly bad effects of irrigation, they should be used against drainage and not against water going on to a property. That brings me to particular aspects of the legislation. The first point that is clear with this legislation is that the new Commission has no additional powers. That is not a criticism. The States jealously guard their powers in relation to rivers, land use, and so forth. So the powers that the River Murray Commission had remain with the new Murray-Darling Basin Commission-that is powers over water quality and quantity within the river and advisory roles from thereon. This legislation envisages a greater advisory role for the Commission. The legislation refers to the whole drainage basin, the Murray-Darling Basin, and extends the advisory role of the Commission to land management, water use, environment, et cetera. The reason for this, the argument goes, is that there is more to the future improvement of the system than just engineering solutions. I accept that. I think the term used is a `total' approach, a `holistic' approach, to the problems of the whole area. There is a need to lift the political involvement in it. If that particularly lifts the New South Wales involvement, I would say that that is doing something. As a Victorian I may be considered to be biased, particularly by South Australians, but I think we would all agree that when it came to the question of priority for the Murray Valley, New South Wales was a long way behind the other two States, and therefore the creation of a broader awareness of the total problem. To achieve this, the River Murray Commission is being replaced by the Murray Darling Basin Commission. The four governments will have two commissioners each instead of one commissioner each as under the old system. A Ministerial Council is being established comprising the three Ministers from each of the four governments; that is, those respon- sible for water, land and environment policies. It establishes a Community Advisory Committee comprising 17 members, the Chairman of which is Professor John Burton of the University of New England, to bring together people from along the river and elsewhere with particular interests and attributes in relation to the system. A standing committee was established in 1985 comprising 12 officials. The eight commissioners of the Commission are on that committee. The additional financial cost, according to the Bill, is $320,000, to be borne equally by the four governments, plus the additional costs to the States. I do not disagree with that arrangement but I do want to make some points about it. Is it necessary to have all of this extra bureaucratic structure? Is all of this extra bureaucracy productive? Is it the best and most efficient way of achieving the improvements we all desire? We all know that it is very difficult to get a group of members of parliament, particularly a group of Ministers, to any meeting at a given time. If we are looking at getting 12 parliamentarians together we will have quite a job on our hands. There is also the matter of the States sorting out competing and contradicting policies not only between the States but also within the States. The Barmah Forest situation is a good example of that in Victoria. There is also the matter of duplicating the work that the States are doing with their own environment and land management in employing people in Canberra and, presumably, employing extra people in the States. Also to be considered are the concerns of the people who live along the river. I represent those people who live along quite a section of the Victorian side of the river. On the one hand, they welcome the Community Advisory Committee and they are pleased that a man of the standing of Professor John Burton is the chairman; but on the other hand, they are worried that people who are remote from the area, who have not really lived with the system, will have too much influence and that the Committee will become too bureaucratised. Cost is also a consideration. Nowhere in this legislation can I see any mention of the cost of the Community Advisory Committee as distinct from the cost of the extra staff being employed in Canberra. I would welcome some advice from the Minister on how that cost will be met and what it will be. My next criticism relates to the way this new arrangement is being promoted. For example, at present inserts are being placed in the newspapers of towns along the Murray River. The heading on one such insertion reads, `Together. We're caring for the Murray River'. The hype in this insertion gives the impression-I am sure quite deliberately-that this is the first time that anything has every been done for the river. That is absolutely wrong. The Times on Sunday last week contained an example of a number of beat-up stories pushing the same hype-that somehow or other nothing has ever happened before for the river, and that suddenly all is going to happen along the Murray even though the Commission has no extra powers. Some of the information in those articles is factually wrong. I am worried that this far more complicated system could slow down progress by, firstly, everything having to be reviewed before anything can be done and, secondly, the fact that the single most important thing that is required for progress to be made along the river, immediately, here and now, on reducing salinity in South Australia, is money. It is not new technology; it is not research; it is not community meetings. It is money. This Government and this Bill give no guarantee of any commitment to financial assistance for those works which would significantly reduce salinity along the Murray. This Government has actually reduced the amount of money granted to those programs along the Murray which can and do reduce salinity. I know that engineering is not the be-all and end-all, but engineering, through salt interception works, has shown that for $27m the EC level at Morgan can be reduced by 80. That is shown from the result of work being done now; it is not from the anticipated result of work to be done in 20 or 30 years with modification to management procedures. In addition, the alteration to the Menindee Lakes system can further reduce the EC level by another 30 and also allow some input from the Shepparton area and the southern New South Wales area, which is not saline water, to reduce the water table in that area. The salinity and drainage strategy indicates this. It is a cost-shared system. The interception is to be downstream to have the greatest benefit for South Australia. I urge the Government to guarantee the finance necessary-as well as these other things, as we are not opposing the legislation-to produce the here and now results which are of critical importance in reducing the level of salinity in the river. I move: That all words after `That' be omitted with a view to substituting the following words: `whilst not opposing the Bill, the House is of the opinion that the Murray-Darling Basin Agreement should be amended: (1) to recognise progress made (a) by previous governments, (b) by the persons who live along the Murray River and (c) in the River's drainage area; (2) to reduce the new bureaucratic administrative and consultative arrangements for the Basin to enable efficient action and co-ordination; and (3) so that the Government with the States provides a firm commitment to finance the already known necessary remedial measures along the Murray River which would immediately improve water quality'. Mr Andrew —I second the amendment. Mr LLOYD —In conclusion, I say that in moving the amendment we are not opposing the legislation but we are drawing attention to what we believe are ways of accelerating the improvement that is taking place along the river at present. Mr O'NEIL(Grey)(8.30) —The River Murray Waters Amendment Bill is another positive step initiated by the Hawke Government in protecting this vital water resource, the River Murray. It is indeed pleasing to see the co-operation between the Commonwealth Government and the State governments of South Australia, Victoria and New South Wales in attempting to overcome some of the problems associated with the Murray-Darling Basin. Through the co- operation of the State governments I have mentioned and the Commonwealth, this amending legislation provides for the improved management of the land, water and environmental resources of the Murray-Darling Basin. This is imperative, because there is no doubt that in the past poor land, water and environmental management practices were commonplace and led to the abuse of the Murray-Darling Basin. This legislation will give a clear legislative base to the operations of the Murray-Darling Basin Ministerial Council. This Council is made up of those Ministers representing the portfolios of water, land and the environment from the four governments. The Council will be in a position to take positive steps to initiate worthwhile programs for the protection of the Basin. The Council will exercise general oversight and control over all major policy questions of common interest to the government involved. The Murray-Darling Basin Commission will be established to encompass the statutory responsibilities provided for under the River Murray Waters Agreement, to undertake an advisory role to the Council on water, land and environmental matters not covered in the Agreement. The Commission will comprise two commissioners from each government, representing between them, water, land and environmental interests, and the following institutional arrangements have been agreed to: a secretariat to be located with the new Commission to service the work of the Council and the Commission; governments to share the associated administrative costs of the Commission; legislation to implement the changes to be enacted in the four parliaments involved by September 1987, to take effect from 1 January 1988; provision to be made in the legislation for later participation by Queensland, following further negotiation; and a standing committee, comprising the heads of major policy departments involved in the management of the Basin to continue to provide policy advice to the Commission. Community groups will also have an opportunity to participate in the strategies of the Murray River for both now and in the future. I think this is very important. Consultation and participation are encouraged, and it is in everyone's interest that a total commitment to protecting this natural resource is an ongoing event. South Australia is a State relatively deficient in both surface and ground water resources. Water is not only in short supply but also generally of poor quality. As my electorate of Grey covers 86.2 per cent of South Australia, I naturally have more than a passing interest in the mighty River Murray. The northern town regions of Port Pirie, Port Augusta and Whyalla in my electorate, along with Adelaide, depend on water pumped from the Murray River for their survival. I was pleased to have the opportunity to represent the Federal Government last year at the opening of a major filtration plant at Morgan, which now provides a high quality filtered water supply to residents in the northern towns in my electorate, as well as Adelaide. The previous speaker, the honourable member for Murray (Mr Lloyd), emphasised the problems facing residents along the Murray. But it is also important to many other areas, particularly in my electorate of Grey and in Adelaide, that we have a good water supply. It is surprising to learn how many members of this House are quite ignorant of the problems of the River Murray. I think the following recent article in the Times On Sunday, headed `The degradation of the noble Murray', is very appropriate and very succinct: Mention the Murray River and many Australians will conjure up memories of distant history lessons and stories of how explorer Charles Sturt's small boat shot from the Murrumbidgee into a ``broad and noble river'' in 1830. The Murray evokes images of the paddle steamer trade and an agricultural eden of lush citrus groves and vineyards. But time is catching up with the Murray, where over a century of irrigation projects-and $4 billion in public money, according to one estimate-have created an environmental disaster. Millions of tonnes of salt, fertilisers and pesticides are being dumped into the river every year. Hundreds of thousands of hectares of some of the richest farming lands in Australia are salting up or suffering other forms of land degradation. Wetlands have been altered or destroyed, forests endangered and much wildlife killed off or put in jeopardy. All this has had an enormous impact on Australia's agricultural production. The Murray-Darling basin, covering parts of four States, accounts for about a third of Australia's total output from natural resource-based industries. It supports a quarter of Australia's cattle and dairy farms, about half its sheep, lambs and crop land, and 75 per cent of its irrigated land. According to a recent report by the Murray-Darling basin Ministerial Council, the land degradation includes soil structure decline, wind and water erosion, dry land and irrigation salinity and soil acidity and is reducing production from cropping land alone by $220 million a year. That sums up some of the enormous problems that have occurred in the past. It is indeed gratifying to see the Government introduce some positive legislation to overcome some of those problems. It would be remiss of me not to say a few words about the previous honourable member for Hawker, Ralph Jacobi, who retired at the last Federal election, and who I believe pioneered the legislation that is presently before the House. When Ralph Jacobi was elected in 1969 he single-handedly led a crusade to overcome immediately some of the difficulties that he was aware of. Back in the 1970s Ralph Jacobi had the following to say-and this is only a short passage from one of the many speeches that he made in this House on this important problem: The problem as I see it is that if salinity is not controlled along the entire length of the River Murray basin, the River Murray will act as a giant saline drain for South Australia. Farm and domestic water supplies will be tapped from a major pipeline system taken from Lake Victoria. Irrigation as we know it will cease, riverside growth will die or change dramatically. Ecological change will be drastic and the lower Murray will no longer be a paradise for fishermen and will not be so attractive for swimmers and the boating fraternity. That is not a science fiction doomsday message, but neither is it a joke. It is just one of the options facing South Australia in the light of the steadily increasing salinity control challenge for the lower Murray environment. Mr Jacobi was so right, back in the early 1970s, as we are today. I am sure that Ralph Jacobi would be pleased to see the number of South Australians who are prepared to speak on this important Bill tonight. It is quite pleasing that the honourable member for Wakefield (Mr Andrew) and the honourable member for Boothby (Mr Steele Hall), along with others, are going to make an important contribution to the debate on this legislation. Apart from the problems of salinity and land and water degradation in the past in my electorate, there has been the problem of a number of deaths caused by amoebic meningitis. The last case was in 1981, when a young lad who was swimming caught amoebic meningitis and later died. It was a tragedy, in today's environment when we like to think that we are up to date with modern medicine and science, that such a thing could happen. Although it is too late to overcome the tragedy suffered by that family, this is positive legislation which will go a long way to overcome many of the difficulties and problems that have been experienced in the past. I am delighted to support this legislation. I oppose the Opposition amendments. I believe that this legislation is objective and is the way to go about overcoming the problems of the River Murray. I am glad that South Australia, Victoria and New South Wales have co-operated with the Federal Government in bringing in this very constructive legislation. I hope that in the not too distant future it will also have the support of Queensland. Mr ANDREW(Wakefield)(8.41) —I welcome the opportunity to participate in this debate on the River Murray Waters Amendment Bill, and largely echo a number of the sentiments that have already been expressed by my colleague, the honourable member for Grey (Mr O'Neil). Although he has said that the legislation should be dealt with in a bipartisan fashion-and I agree with him-I cannot turn a blind eye to the all too low priority given to the River Murray Basin by this Government since it came to office. Somerset Maugham once penned these words: It is dangerous to let the public behind the scenes. They are easily disillusioned and then they are angry with you, for it was the illusion they loved. Frankly, this Government has been a government of illusions in areas where it ought to have been active. There has been the illusion, as recently as this September, of a balanced Budget; the illusion of improvements in our export opportunities, which have largely resulted from the falling Australian dollar and not from specific government action to make our industries more competitive; and the illusion of four years of this Government and of four years of relatively good River Murray water. It has created the impression that a number of the problems in the River Murray Basin have been solved under this Government. I am sorry to say that that is the saddest illusion of all. The truth is that over the past four years we have had the sort of climatic conditions that, even in periods of relatively low flow, have favoured quality water in the River Murray Basin. The very years that should have enabled us as a nation to ready ourselves for the inevitability of the next drought have been frittered away. The Government's inactivity has been masked by climatic conditions which, even though the flow may have been lower, has meant that irrigators have made less demand on the river; and the lower flow has not produced the sort of saline inputs which sometimes have been characterised by low flows and drought years, and which the former Government had to face and could not escape in 1982. As a result of its experience in 1982, the Fraser Government made a commitment to spend $640m in a bicentennial water program. It is fair to say that the Hawke Government has not entirely ignored the nation's demand for improved water reticulation. As the Budget Papers illustrate, in the years 1983 to 1987 the Hawke Budget has committed $240m to improved water reticulation programs, and in the 1987-88 Budget year it has promised to spend $57m in improved water reticulation. But the portion of that money committed from 1983 to 1987 to salinity and drainage control in the Murray Valley was $20.8m. Less than 10 per cent of our total national water resource budget went into our major water resource, and there can be no excuse for that. Australia has no major resource to match the River Murray. When we talk of resources we tend to think about mining, wheat, wool and horticulture, but the truth is that this nation depends totally on water. Consider, Mr Deputy Speaker, as you as a Western Australian will be well aware, the all-too-sobering fact that if one travels from Perth to Adelaide, by the time one is 100 kilometres east of Perth one has passed over the last flowing stream until one reaches the city of Adelaide. On the Murray River within the Murray basin there are 16 cities, a quarter of the nation's cattle, half of our sheep and lambs, a quarter of our dairy farms, half of our crop land, 30 per cent to 40 per cent of our natural resource based industries and over $10 billion of annual production. For all of this, this Government has committed nothing more in its term of office than $20.8m, or less than 10 per cent of its total national resource budget. Mr Scott —What did you do when you were in government? Mr ANDREW —I remind the honourable member for Hindmarsh that I have nothing to apologise for, when I look at the record of the Fraser Government in its commitment to the river basin. I can understand the honourable member's indignation, but I cannot excuse it. The honourable member for Murray (Mr Lloyd) has already made the valid point that the present problems of the river basin are not new. Since time immemorial the River Murray has carried an enormous salt load out to sea. It has done so because it and a number of its tributaries flow through what was once a vast inland sea. In the process it picks up two of the major problems that irrigators and those who live off its waters have to face. I refer to the problem of salinity and that of turbidity-the clay particles and fines that make up the mud that is characteristic of the river. Between the river rising in the Albury area and reaching the border with South Australia it carries 1.4 million tonnes of salt per annum. Astonishingly, from the South Australian border to the sea, that 1.4 million tonnes is supplemented by another 600,000 tonnes of salt per annum. If one were to sit on my property in the Riverland of South Australia and watch the river flow past, one would be watching the equivalent of a semi-trailer load of salt-24 tonnes of it-pass one's eyes every 12 minutes. That is the problem-a problem which can be rectified, but rectifying it calls not only for government legislative action such as we have before the House this evening, but also for a dollar for dollar commitment from the Government to do something about the salt and turbidity loads of the River Murray. I speak with some passion as a South Australian because salinity is estimated to cost my State at least $42m every year, and the cost of filtering the turbidity in the water is around $40m in the maintenance of existing filtration systems. I belong to a State that is at least 49 per cent dependent on the resources of the Murray for its total water uptake. I have alongside me the honourable member for Boothby (Mr Steele Hall) who, as Premier of that State, committed his political future to improving the quality of the water in the River Murray. As the honourable member for Grey, a fellow South Australian, acknowledged, I am joined tonight in this debate by South Australians from the electorates of Barker, Boothby and Mayo who also are concerned about what happens in South Australia to a river that rises in Victoria and New South Wales. In our State, from Keith in the south east to Woomera in the far north, communities are dependent on the River Murray because no other reliable water source is available. The honourable member for Grey has already eloquently outlined the problems of the River Murray. He said that they are major problems. My plea to the Government is this: As one of its members says that this river faces major problems, where is the major expenditure necessary to address them? I turn for a moment from the attack on the Government and the paucity of money it has made available specifically to the River Murray Basin, to remind the Government of one other uncomfortable truth; that is, a great deal can be done to improve the quality of the water that flows out of the Murray-Darling Basin without necessarily spending enormous sums of money. On 30 March 1984 I met for the first time the honourable member for Farrer (Mr Tim Fischer) at the opening of the Rufus River saline inception plant. That was a major piece of government expenditure. By the way, no one from the Federal Australian Labor Party was present for the opening of that plant. Six months later I happened to be in the Loxton Irrigation Area and saw the plans and progress that had been made in installing the saline inception plant designed for the Noora basin south of Loxton. It was designed to pick up drainage water out of the Berri, Barmera, Monash and Loxton irrigation waters and push it out to Noora so that the saline water there would evaporate away. That involved major expenditure; in fact, $15m had been committed to that whole operation. But as it turns out, Noora was a lesson in just how it is possible, without expending large sums of money, to address some of the problems that irrigators and South Australians face in water quality. With only minor expenditure, great steps can be taken to redress some of the problems currently facing the Murray River. I want to ask the Government-as I last asked it on 21 November 1985-how, having so amended the Taxation Act under the Taxation Laws Amendment Bill (No. 3), it can possibly defend taking away from irrigators the right to make a major tax deduction of the water conveyancing improvement measures they have made on their properties. The removal of that tax deduction, which cost the Government nothing more than $25m over five years or a total of $5m a year, was a major blow to irrigators efficiently using River Murray water. That major blow meant the inefficiency continued and so frankly we have further pollution of the River Murray Basin as a result of irrigation-unnecessary pollution at that. The provision that existed in the tax Act that allowed irrigators to install pipelines, drip irrigation, micro jet irrigation and so on to measure the amount of water that went to every plant, has gone. For the sake of saving a very small outlay-$25m over five years-the Government has destroyed the efforts of a multiplicity of irrigators endeavouring to sort out their own irrigation problems. Worse than that-as if that were not bad enough-it has destroyed the opportunity for a productivity increase that every irrigator had under that particularly encouraging piece of legislation. It is easy to rise in this chamber and say, `Well, why should the Government be committed to enormous sums of money to tidy up the Darling-Murray Basin in order to further subsidise irrigators?' That is a piece of arrant nonsense, to which the honourable member for Murray has already alluded. I would gladly take you, Mr Deputy Speaker, to areas in my own electorate where there are private, not government, irrigation schemes and where there is no government input as such. Those are the areas that are not only making money but are also currently in demand. In resale terms it costs far more in my electorate and in the electorate of Barker-at least 100 per cent more-to buy into a private irrigation area than to buy into a government irrigation area. What does this tell us about subsidies for irrigators and about privatisation of our existing irrigation schemes? It has been easy to say that we need the locks and all this investment in order to sustain irrigation. As the honourable member for Grey has said, the truth is that we need locks and this investment not solely for irrigation but also for all those people in the Iron Triangle cities, 90 per cent of whose water comes from the River Murray, all of whose production goes into industrial pursuits and who desperately need River Murray water. We need those locks and those facilities for Adelaide people whose water dependency on the River Murray may range between 20 per cent and 80 per cent, and not solely for irrigation. Tonight we have before us legislation which changes the form of the existing River Murray Commission. This legislation brings the four governments of South Australia, New South Wales, Victoria and the Commonwealth together in what will be known as the Murray-Darling Basin Commission. This body will effectively succeed the River Murray Commission. This has taken a long time. It took us from 1863 to 1913 to set up the River Murray Commission. From 1913 to 1983 and subsequently, we have had a lot of reports that frankly we could not jump over. Now we have an opportunity to make the recommendations of those reports work. We have that opportunity first, by passing the legislation that is currently before the House so that we can establish the Murray-Darling Basin Commission; secondly, by giving legislative recognition to the existing Ministerial Council; and thirdly by allowing that Ministerial Council to establish a community advisory committee. But all those reports and the legislation currently before the House will be meaningless unless the Government is prepared to commit some dollars and cents to this new program. The honourable member for Grey said that we have legislation before this House to overcome the problem. I am sorry, but he was wrong. Tonight's legislation does not overcome the problem. It merely facilitates the steps to overcome the problem if the Government is prepared to commit the resources that the Murray-Darling Basin so desperately needs and deserves in the interests of future generations. I am prepared and delighted to support the amendment and the legislation. Mr CAMPBELL(Kalgoorlie)(8.58) —Coming from Kalgoorlie, which is the centre of the world, I can take a more objective view of this River Murray Waters Amendment Bill 1987 than my colleagues from New South Wales, Victoria and South Australia. However, I am not without a vested interest because I grew up on the River Murray in South Australia and, in a sense, I feel that I am still a croweater. I have retained my interest in the River Murray. I believe that this is a good piece of legislation. It is not by any means the whole answer, but it is a step along the way; it is a gradual improvement. The honourable member for Wakefield (Mr Andrew) asked what this Government has done. This legislation itself is testimony to what this Government has done and its concern for the River Murray. This legislation, long overdue, could easily have been introduced by the Fraser Government, but it chose not to act. I want to talk for a while about the history of the River Murray. It is one of the world's great rivers and it is absolutely vital to Australia. If the Murray were to become saline, the effect on the economy of Australia would be catastrophic. It would probably wipe out two or three jobs in every five and the effect would be equivalent to a large and virulent outbreak of foot and mouth disease taking hold in Australia. It behoves us all to look after the River Murray as a national resource and I believe that this is something that this Government recognises. Earlier tonight I had in the chamber a very good friend who farms in the electorate of the honourable member for Murray (Mr Lloyd). I must say that he was very impressed with the speech of the honourable member for Murray which I guess, in a sense, shows how easily pleased some of our farmers are. What the honourable member for Murray said was, in a sense, like the curate's egg; it was good in parts. I agreed with him, although I was a little annoyed when he tried to make politics out of the issue. But on balance he was quite sound. Salinity is a real problem. Honourable members opposite have tended to make light of it. I have heard assertions that productivity is rising. That is true, but for how long can it continue to rise? There are certainly no grounds for complacency. It is true, as was said by the honourable member for Murray-it was reiterated by the honourable member for Wakefield whom I will come to later-that a lot of salt has always gone down the Murray. But the volume of salt has been considerably added to in recent times, basically from three sources: bad irrigation practices over the years which have been greatly modified, rising ground water caused by the ingress of a large amount of water and the effects of erosion and salinity generally. I have long maintained that the two greatest problems, the twin problems facing the environment of Australia, are soil erosion and salinity. They are overwhelming problems. It is testimony to the shallowness, greed and ignorance of many people in the environmental movement that they do not address these twin problems. In areas of high rainfall and nice trees they love to chain themselves to trees. They feel that that is achieving something. The truth is that in high rainfall areas anything can be regenerated. If the rain falls, the work is relatively easy. The environmentalists do not show any interest in the arid lands of Australia or in the problem of encroaching salinity because it is not a problem that can be confronted with demonstrations. It requires hard and constant work, constant expenditure reserves and vigilance by governments. It is a situation that takes many years to reverse. Therefore, there is no glory in it. One does not pack one's children into the Range Rover to go to see salinity or soil erosion. I often cite the greed and shallowness of this bigoted minority which seems to exercise so much influence in our community today. The honourable member for Wakefield alluded to Somerset Maugham. I am not a literary man myself, but in my callow youth I used to take part in method acting. Method acting was a type of acting invented by some Russian gentleman where one acts naturally on stage. I remember, during some of the stark Russian dramas, that I had nothing to do but sit on the stage and pick my nose, a habit which I have found very hard to shake, I might add. In one of Maxim Gorky's plays there were some memorable lines: If tomorrow the sun would cease to shine and light the earth with its rays, tomorrow some madman's dream would illuminate the world. I think that is very profound. It is true. Whilst we have greatly added to the problems of River Murray salination, we are in the process of redressing them. With goodwill and the necessary commitment from governments, State and Federal, I believe that we can redress them. But the problems of Murray salination do not occur simply along the Murray. They occur in the hinterland of the catchment area, the catchment area of over a million square kilometres that is the basin of the Murray-Darling river. The work one has to do may have to be done hundreds of miles from the Murray itself. In the areas where we have cut down mallee, which has led to rising levels of soil salinity, we have to replace the vegetation to draw down, once more, the water-table. It is much harder to do that when the table one is trying to draw down is saline. One has to attack the problem at the edges. But with new practices and the use of perennial pastures and lucerne we are drawing down the water in some areas. Over the years we have set loose a glacier of salt which is moving slowly by inevitably towards the Murray. We have allowed the penetration of water into what were previously relatively dry areas. We have raised the water level and dissolved the salts contained in the soil. Those salts are now moving through the soil, so much so that in some places the problem has to be countered by what I call the engineering solution. My very good friend the honourable member for Wakefield gave an appallingly political speech tonight. Mr Robert Brown —I thought it was going to be good when he stood up. Mr CAMPBELL —I thought he was going to be good but he really blotted his copybook. This is far too big an issue to play politics with. When he talked about the success we have had in pumping back the water into basins so that it can be evaporated safely, I was struck by two things. Firstly, he said that it involved a significant expenditure of money. He alluded to $15m as a significant expenditure of money. Then he said that one could do it very cheaply, that it costs virtually nothing. One cannot have it both ways, unless one is a member of the National Party and intends to cross the floor shortly. National Party members are the only people I know who employ that sort of logic. The engineering solution is only a method of buying time. It is not something we can do forever. Sooner or later we will fill up the depressions with salt which has to go somewhere. So the engineering solution is an interim measure, a time buying measure. It is not the answer. The answer lies to a large degree in the soil structure. One of the great improvements we can make is to monitor soil to the degree of being able to wet it with less water, not applying so much water that it permeates to the aquifer. One has to restore soil structure. In that regard a lot of good work has been done by all State agricultural departments with the advocacy of the addition of calcium sulphate to the soil as a soil flocculent. This is a great initiative, although it is not being done on the banks of the Murray but some distance from it. Similarly, the problem of soil acidity, caused by the addition of lots of superphosphate to the wheat land, has to be countered. Soil acidity reduces the growth of crops and the uptake of water. South Australia has the hardest job. It is on the wrong end of the Murray and inherits everyone else's salt. I am told that when the water crosses the border of South Australia it already contains about 500 parts per million, which from memory is about 35 or 40 grains, of salt. Whilst the water is still quite potable, the amount of salt is significant and is a high base to be starting from. Thereafter a lot more salt is added to the water. South Australians have had to adapt most to meet the salinity problem. They have done so with channel irrigation, drip irrigation and under-tree irrigation, which has been very successful in the citrus and stone fruit orchards on the Murray. The South Australian Department of Agriculture is to be commended for the work it is doing in this area. The problem is significant. If one is to face this problem one has to face the facts. Ninety per cent of the water used in the Murray is used for irrigation purposes. Sixteen cities are dependent on the Murray. They are not all in South Australia. Canberra is one of them. It is not by charging people in the cities that we will counter the problem. The locks and the dams on the Murray are essential to controlling salinity. If it were not for those dams we would not be in our present negotiating position, with New South Wales and Victoria agreeing to release large volumes of fresh water at times to provide the dilution South Australia requires. Let us be quite clear that this is a problem for the irrigation industry. The irrigation industry is facing up to it and will continue to do so. But we cannot go on forever expanding irrigation production on the Murray. It is already, as the honourable member for Wakefield said, the source of $10 billion worth of agricultural produce. If we are to have more irrigation, we must look at expanding into areas as yet untouched. In my electorate, the Ord River offers enormous potential. The Bill does not go far enough because it does not give any additional power-more persuasion perhaps, but no additional power. This problem is so important that we will have to face up to giving a Murray-Darling catchment area authority much more power-power that overrides and transcends State rivalries. Already as much as 90 per cent of the irrigated land in New South Wales is suffering the effects of salination. The problem is so vast that it effects the whole of Australia. While some 1.6 million people are directly affected by the welfare of the River Murray, it indirectly affects every single person in Australia. The problem is a national problem and must be tackled on a national basis. While I commend the Bill, I believe history will show that the authority needed more teeth. Mr STEELE HALL(Boothby)(9.11) —Upon study, the River Murray Waters Amendment Bill clearly sets out new names and adds new personnel for several new commissions and sets out an organisation for intentions to pay further departmental and governmental attention to the problems of the Murray-Darling Basin. As the second reading speech says, the Bill indeed sets out for improved management of the land, water and environmental resources of that basin. The second reading speech goes on to illustrate how it sets out also in this organisation to reduce conflict between the State governments, particularly in relation to the rights that they hold as sovereign States, and it sets out in one particular paragraph the proposition that it requires reconciliation of the disparate interests and aspirations of diverse populations of over two million people within boundaries encompassing in excess of one million square kilometres. The schedule sets out how far the basin extends physically, and it is sobering to contemplate the problems that exist within that vast area. The basin extends further than 400 kilometres beyond the New South Wales border into Queensland. It takes in most of New South Wales and about half of Victoria. It is, indeed, the most productive area of Australia, obviously, from the vast content of land mass. It is good that additional people are to be involved in the Commission and in the new Ministerial Council. One of the problems in the past has been a low recognition factor of the problems that faced the States and the people whose livelihoods depend on this water. I clearly remember one illustration of how little regard some people have had for the problems of the river and its tributaries. Some years ago when I had a particular responsibility in the negotiating field in relation to achieving the results in Dartmouth, I approached the then Premier of New South Wales, Sir Robert Askin, for his assistance. On visiting him I received a very good reception. I said that South Australia, as one of the contracting States in the River Murray Waters Agreement, would be pleased to receive his help in setting up the agreement. He said, `Sure, I will help you and the South Australians in this matter'. I said, `It is in regard to the Dartmouth Dam,' so he picked up the phone, got his engineer in chief on the line and said, `I would like you to help South Australia in this matter about that river'. He then turned to me and said, `What is the name of that river again?' His failure even to hold in memory the name of the river and the Dartmouth Dam-I should say it was not the river but the dam-for more than about three or four minutes was quite shocking to someone who had spent months and years in the negotiating pit dealing with that matter. So I am pleased to find that more people are to be involved and that there will be additional Ministers on the Murray-Darling Basin Commission with specific Ministers allocated to the Ministerial Council. That is a plus, and I hope that those Ministers will all have further regard and take back to their States and to the Commonwealth Government the greater importance that this basin will have in the future of Australian agricultural and urban activities. The problems of the past have changed. Obviously, the first question that faced the first irrigators on the Murray was a matter of the quantity of water and the cost of diverting it to their particular usage. That continued to hold the attention of users of the river for a very long period. Even in the 1960s, in South Australia the problem was to get a quantity of water to service the rural and urban areas of my State. Although the matter of quality became very important in the choice between the then proposed Chowilla Dam and the eventual Dartmouth Dam that has been built, it was that question that exercised our minds to the greatest degree. It has been interesting to find since then the very great change of opinion as the urgency has been brought home to individual irrigators, and to governments that they must try to ameliorate their conditions. I was very pleased indeed to find that in 1983 agreements were entered into and ratified by the various contracting governments and the parliaments involved to give attention for the first time to the quality of water in this great system. In studying the reports, I was interested to find in the annual report of the River Murray Commission for 1985-86 tables that are annually included which show the evaporation losses for the various storages on the River Murray and its tributaries. I was more than ever convinced after reading those tables how right it was to build the Dartmouth Dam and not to proceed with the Chowilla reservoir, which had such huge momentum behind it from South Australia in the mid-1960s, because the evaporation comparisons between the shallow Menindee Lakes and the Dartmouth Dam are quite staggering. The shallow Menindee Lakes had a net evaporation loss of 602 gigalitres in 1985-86. The Dartmouth Dam, which of course has a much larger capacity, had an evaporation loss of only 19 gigalitres. That comparison sets out the complete answer to the old question, which I do not believe will again be revived, at least for a very long period, if ever. However, Mr Deputy Speaker, the problem of salination of the irrigation lands of the basin is enormous, and the demand for increased usage in the urban areas will increase. There is a direct relationship between the demand to serve the cities in South Australia, for instance, and the economic growth in the community. The report Water 2000, which was printed in 1983 gives some projections of increased demand for the Murray-Darling Basin over the ensuing year and, of course, they differ according to the growth factors that are taken into account in the basic calculations. The growth projected for the year 2000 is an enormous increase on the previous measurement in 1977. At growth rates of perhaps 2 or 3 per cent a year, over a longer period there will be an enormously increasing load on the river for urban and industrial use. Many articles have been written about the salt problem. One wonders whether the small individual salt diversion schemes which have been mentioned by my colleagues can ultimately maintain the river at the required level of salinity, or reduce it to the level required to meet the major international standards for water usage. I know that a number of very pessimistic articles have been written in various scientific journals about the future of the system. There have also been major proposals by the more enthusiastic of those people involved in considering the problem of piping the saline waters directly to the sea. Those of a more sober nature who are involved in the possible financing of such wide scale projects hold the view that this is financially impossible, and that the community would be unable to bear the cost of getting the salt in the affected lands from the river to the sea on such a scale as to be effective. If that is not to be the case-if we are unable to have a major scheme to reach the sea with most of the salt which is now affecting on an aggregating scale the plantings along the river-we inevitably will have to rely on the smaller schemes that have been mentioned and which are proving to be of value, as has been illustrated in the debate tonight. That is something which we hope this Government will take further notice of, and we hope that it will heed the requests from the industry and the people who live in the basin to provide further funds. We hope that the machinery which the Government is setting up and looking to for advice will provide that advice, and that the Government will take note of it and will not simply stockpile the information, as it has done in the past in so many areas. There is no doubt that one of the big factors behind the current relatively satisfactory position in the quality of the water in the River Murray is that the Dartmouth Dam is on stream. Mr Lloyd —Also, it is almost full. Mr STEELE HALL —Yes, and in fact it is providing some of the best quality water, so far as salinity is concerned, that one can expect. This is borne out in the 1983 report of the River Murray Commission which had this reference to salinity: Despite the drought conditions which prevailed for most of the year, the salinity of the River was generally lower and less variable than for the previous year. It also states: The lower salinities during 1982/83 were due to the fact that high quality water from Dartmouth Dam was used to maintain River flow through the drought combined with the exceptionally dry conditions which prevailed along the lower reaches of the River catchment and floodplain. The Dartmouth Dam has obviously been proven in that particular time of need. If there cannot be a wholesale plan to get rid of the salt by its diversion and piping to the sea, not only will we have to rely on the individual schemes which are being entered into, but also we will more than ever have to rely on high quality water being released into the body of the stream itself. To do this we will have to look to further storage on the river. I understand that there is still the capacity in the headwaters of the tributaries to the River Murray for a further dam of consequence. There would be no point, of course, in considering a new significant dam on the headwaters of the River Murray if the water yield from it were to be devoted to further irrigation. That would probably worsen the position, because further irrigation would amplify the salinity problem. I believe it is now necessary to look with great intensity at the salinity and quality problem; to understand that we must preserve the irrigation areas and the urban usage that we have. We must understand that the problem will probably grow as water tables rise significantly in other areas as time passes; and that to preserve the quality of the water we need a repeat of the Dartmouth Dam situation. We require further storage to allow water of ideal quality into the River Murray under the management of the new Murray-Darling Basin Commission. I call on the Government not only to proceed with the proposals contained in this Bill but also to act on the advice that it will inevitably receive on the various schemes that will be proposed to ameliorate the salt conditions in irrigation areas and to otherwise improve the quality of the water. I call on the Government to take a lead in this new Commission; to set in motion studies for a further dam on the headwaters of the River Murray system; and to ensure that when the need is there in future years, the impetus will be there for governments to proceed. It is not a short term proposal. There is no way of knowing the time needed to study and produce the information that is required on which to base the proposal of a new dam, but one knows that it takes time to get the contracting governments to the River Murray Waters Agreement to accept the proposals that are put forward. One could easily envisage a period of 10, 15 or 20 years before this sort of project could become a reality. There is no time to be lost now in ensuring that preparations are made to meet the need when it obviously arises. I call on the Government not only to look at this organisation and to look at the small scale schemes that it will be necessary to implement, but also to look at the major aspects of strategy to improve the quality of the River Murray and to proceed with planning for the future for a new dam dedicated not to extend the areas of irrigation but entirely, in the first instance, to the maintenance and improvement of the quality of water in the system. Mr TIM FISCHER(Farrer)(9.28) —I wish to discuss some of the points raised by my colleague the honourable member for Boothby (Mr Steele Hall), and I shall do so in a moment. I recall that many years ago an American magazine used to feature a nuclear clock on its masthead and showed at various times what the time was in minutes to midnight, depending on the height of tension around the world at the time. During the Cuban missile crisis, it was down to one minute to midnight. At other times it might have shown 10 minutes to midnight. I inform the House and the nation tonight that for the River Murray system the time is one minute to midnight in terms of the environmental equations, the salinity problems, and the need to bring about a major breakthrough in liaison, co-ordination and control. I hope the River Murray Waters Amendment Bill 1987 will in fact do that, but I share some reservations, as adequately expressed by the honourable member for Murray (Mr Lloyd) and the honourable member for Mallee (Mr Peter Fisher), when speaking elsewhere, and by other honourable members, who said that the infrastructure may not be good enough to do just that. I was pleased that the honourable member for Boothby, a South Australian par excellence and a former Premier of that State, saw fit to validate history by endorsing the major decision to build the Dartmouth Dam as an alternative to the Chowilla Dam, and to reflect on the many benefits that have flowed from that decision, particularly in terms of high quality water being made available to the River Murray system. According to the latest bulletin from the River Murray Commission, the storage capacity of the Dartmouth Dam was sitting right on 91 per cent at 18 November 1987. That is the highest level this massive dam has ever reached. It is very high quality, cold water. I take this opportunity to say to the honourable member for Boothby that he should not be too anxious to promote the cause of more big dams upstream of the Murray River. There are environmental downsides to that equation. The upside is that it provides good quality, cleansing water to the Murray River. Both of the dam sites most favoured by the engineers at this stage would involve major clashes with the Kosciusko National Park. I refer to the Devil's Grip Gorge site upstream and the Murray Gates site upstream. One other site-the Jingellic site-is a massive site not far upstream from Albury and the existing Hume Weir. The wall of the Jingellic site would rise in the waters of Lake Hume near the Dora Dora Hotel. That site too has been assessed by engineers and others and found to have severe environmental problems should the project be proceeded with. The era of building big dams to solve big problems, primarily at times of big elections, has passed this nation by. I do not rule out entirely the possibility of additional storage on the Murray River. But as the member representing the largest section of the Murray River-I represent the area from Mount Kosciusko, the source of the Murray River, through Khancoban, Albury, Corowa, Moama, Swan Hill and Murray Downs to Wentworth on the South Australia border-I put to the House that we need to think very carefully about further major storages being built on the Murray River system. We need to think very carefully about the economics of a water quality only storage facility. I certainly agree with the honourable member for Boothby that the building of a further storage facility which would open up massive areas of dry valley hinterland to additional irrigation is unlikely to be adopted and it would be very unwise to adopt it at least until we resolve some of the ongoing problems associated with salinity in the Murray Valley. I should mention two additional matters to the House. Firstly, some year ago the relationship of the operation between Dartmouth Dam and Hume was out of kilter due to the delay in releasing waters from Dartmouth in time to cope for the end of summer and dry autumn seasons. Because of restrictions on the quantity of release that can be physically made available from Dartmouth to Hume, the whole system got out of kilter for a short period. There were major problems for irrigators as they sought to finish their rice and summer crops, and we hope that will not be repeated. I have discussed this matter with the existing River Murray Commission. I have sought and obtained an assurance that it is monitoring daily the relationship between the level of Dartmouth, which is at present above 90 per cent, and the level of the Hume which is fast dropping below 75 per cent, to make sure that they do not get out of kilter, that the Commission will take account of the limited channel capacity between Dartmouth down the natural river system to the Hume and that irrigators not only in New South Wales and Victoria but also in the electorate of my colleague the honourable member for Barker (Mr Porter) will be adequately catered for in the latter part of what could be a very dry, hot summer and early dry autumn. The second matter I should mention with regard to the salinity equation and the need for flushing clean waters is that Mr Ken Johnson, the Chief Executive of the River Murray Commission, suggested, in a formal bulletin issued on 19 November, that releases from the Dartmouth Dam this year could be required to commence as early as mid-December 1987. That has a lot of significance for South Australia because it would mean flushing clean water through the system, and the aeration necessary to take place to warm the Dartmouth Dam water before it can be released lessens the environmental impact of the freezing cold water. The process will be required to be commenced in the very near future. It is costly but it is a price we have to pay. Diesel generators driving air compressors will be utilised to warm that water ahead of its release to the irrigation system of the Murray Valley. The honourable member for Boothby and other honourable members have touched on the salinity question. The Minister for Resources (Mr Peter Morris) in his second reading speech also did so. Mr McGauran —Inadequately, though. Mr TIM FISCHER —I accept that the honourable member for Gippsland represents just a little part, but nevertheless a significant part, of the Murray Valley. I introduced him to that part of his electorate. He participated very constructively in Tumber Trek. He climbed Mount Kosciusko and Mount Townsend a couple of Januaries ago as a tourist promotion. As I said at the outset, the hands of the clock on salinity, as far as the Murray system is concerned, stand at about one minute to midnight. We have been very lucky over recent years that natural causes have brought about high river flows which have helped to ease electric conductivity (EC) counts particularly downstream of the entrance of the Barr Creek, downstream of Swan Hill, Mildura and beyond. I have to tell the House about brilliant schemes such as the Wakool salinity interception scheme. On the New South Wales side of the border some $40m plus has been spent and this wonderful scheme, on the face of it, has benefited 80 farmers or more. That salinity pondage is leaking to the south and west. It is leaking horrific amounts of salt water to the south and west and is adding to the underground problem of highly saline waters drifting back towards the outer branches of the Murray and ultimately back to the Murray. Worse still, it is also causing back pressure to the north and east which is degrading land in that area. On 1 December next, in company with my State colleague, the honourable member for Murray, Jim Small-he is an effective operator-I will be meeting with land holders to discuss the severe problems faced by primary producers in the immediate environs of that Wakool salinity storage scheme. This leads me to address the question of leaky soils. Not so long ago it was revealed that about one-third of the rice crop of New South Wales was being grown on leaky soils. It was the classic situation, not a majority situation. When a farmer was asked to provide test boring samples of clay in his rice paddies he immediately went to the nearest dam bank and found a very good patch of clay with which to load up his sample so that he would get approval to grow rice on his land. The reality was, not so long ago, that one-third of the New South Wales rice crop was being grown on leaky soils. Therefore, it was leaching through to the salt deposits below that land, adding to the general water table problems especially to the south and west and exacerbating the danger for the valley system as a whole. I recognise that the rice industry is a responsible industry. It is making valiant attempts to address this problem. If the New South Wales rice crop could from next year onwards cease to grow any rice whatsoever on leaky soils and if my colleagues and friends on the Victorian side of the border could, by one method or another, divert once and for all the Barr Creek salt deposits into the Murray Valley system, we would be a long way towards addressing the problems which affect South Australia and beyond. Mr Lloyd —Victoria has far more than just Barr Creek. Mr TIM FISCHER —I realise that Barr Creek is only one of several aspects of the problem on the Victorian side of the border. It is a particularly notable one. Mr Lloyd —Extension work is being undertaken, including a local program to reduce it considerably. It is part of a total control. Mr TIM FISCHER —I accept that the honourable member for Murray is correct in referring to the rectification which is taking place on the Barr Creek. But I do not apologise for mentioning the Barr Creek, and I do not apologise for mentioning the Wakool salinity problem. I realise that this is a sensitive problem but it is a serious one. I say to the House that I believe that the new Commission has a major challenge ahead if it is to overcome these problems. There is no guarantee that the new structure proposed under this legislation will automatically overcome those problems. The honourable member for Murray has correctly alluded to the bureaucratic aspects of the apparatus being created by this legislation. I assure my electors and my colleagues that I will be monitoring this legislation extremely closely to see whether it performs up to the criteria or objectives which are laid down, to see that it does not merely become a massive environmental intervention into the deliberations, management and operations of our vital Darling and Murray river systems and to see that genuine progress is made in arresting the salinity problems which are prevalent in the valley. In conclusion, and on a parochial note-but not one relating to any particular tributary of the Murray-I mention that the location of the headquarters of this new Commission is yet to be decided. The River Murray Commission headquarters are here in Canberra. There are some reasonable arguments as to why that is so. It allows for a neutral deliberation by the River Murray Commission with regard to its work, without its being unduly influenced by those electors who live at Echuca, Moama, Cohuna- Mr Downer —Murray Bridge. Mr TIM FISCHER —Murray Bridge or wherever. I want to refer to the Minister the very reasonable suggestion that the headquarters be at the national growth centre. There are already a number of laboratory and other resources located at Albury-Wodonga which lend themselves to the support work of the new Darling-Murray Basin Commission headquarters. I hope that the Minister, reasonable person that he is, will give very careful consideration to the location of the new Basin Commission headquarters created by this legislation. I support the Bill. I particularly support the amendment moved by my colleague the honourable member for Murray-despite everything. I hope that this new legislation and the new Commission will not become a bureaucratic monster, but will become a real performer in terms of the future of our great river systems of south eastern Australia. Mr MILDREN(Ballarat)(9.43) —First, I would like to congratulate the honourable member for Farrer (Mr Tim Fischer). I think the speech which he has just concluded was a particularly valuable contribution to the debate. While I am at it, I must say, too, that I am a little disappointed in the speech which came from the honourable member for Wakefield (Mr Andrew). It was not typical of the speeches which he normally makes in this House. Also, I hope that the Deputy Leader of the National Party, the honourable member for Murray (Mr Lloyd), will not be too tough on the honourable member for Farrer for the comments which he made about Barr Creek, and I hope his temperature reduces. The comment was made earlier that insufficient credit has been given to work that has been done in the past on mainly the Murray River system. It is probably only fair to say that the Murray River Commission has done a tremendous amount of very valuable work in the past. What we are looking at is something a little bit different from that which we have seen in the past. We are not just looking at the Murray River system, and I think most of the debate tonight seemed to be concerned with the Murray River system. This measure involves more than that. It is the entire Murray-Darling basin that we are referring to, and that covers an area probably in excess of a fifth of the entire Australian continent. When we look at the matter in that context we begin to realise that we are not talking about just the water of the Murray River. Unfortunately, I think the debate tended to get sidetracked a little on to that aspect alone. I can understand that those people who come from electorates that border the Murray River would take that position. Nevertheless, I think we have to recognise that it is a much bigger issue that we are dealing with tonight. What we are really looking at is a holistic position, and I will say more about that later. We are trying to deal with the entire resources of the Murray-Darling Basin. That is what has to be emphasised. The suggestion was made that the solution to the problem was money. I am a bit disappointed in the honourable member for Murray for making that comment. It is pretty obvious that we need money for these sorts of things. On other occasions the honourable member for Murray would ask the Government to be extremely careful in the way in which it handles money. Once again, we have to look at a broader range of issues. I want to pay tribute, as did my colleague the honourable member for Grey (Mr O'Neil), to a wonderful man who did a tremendous amount of work to draw this Parliament's attention to the problem of inland fresh water. I refer, of course, to the previous member for Hawker, Ralph Jacobi. Probably no person in the history of this Parliament has done more than Ralph to highlight the need to recognise the problems associated with, in particular, the waters of the Murray-Darling. I think the legislation we are debating tonight will be received with great relief by a diverse range of groups throughout Australia. In particular, those who live within the Murray-Darling Basin will, I hope, say that it is about time the various governments concerned got their acts together to update the existing legislation. There is just no resource in this country that so defines the problem of this the driest country on earth than the waters and related land of the Murray-Darling Basin. What has been, from an historical standpoint, a question of water management has been handled co-operatively; but the total use of the land and the water resource has been neglected. In fact, many of the problems that we currently recognise in that Murray-Darling Basin exist because of the concentration on one of those resources alone. How on earth could it have been possible to deal satisfactorily with the matter of water usage without at the same time recognising the vital inter-relationship between land usage and water usage in this vast region? That the problem has been so persistent is probably due to the complex competition within the area of the basin between vastly different interest groups. As I said before, the region covers more than a fifth of this continent-in excess of one million square kilometres. The area is about as large as a quarter of the land mass of continental Europe. At least in the review and the agreement in 1983 there has been some recognition of the need to draw debate towards water quality. I believe that once that move had been made it was a logical extension to look at the inter-relationship between water usage, water quality, land usage, and, if you like, land quality. Considering that the Murray-Darling Basin production from all sources comes to $10 billion annually, the significance of land and water usage in the region to the economy of Australia cannot be underestimated. Just by way of elucidation, it is estimated that the effect of land usage throughout the system since Europeans first occupied the basin has left vast areas in a degraded state. Much of the area is either fragile or endangered by some form of salination. For example, it is estimated that one million hectares in Victoria alone has been affected by water erosion caused by cropping. Most of this lies within the zone of the Murray River Basin and a further 4.8 billion hectares has been affected by grazing. Most of this land also falls within the Murray Basin. A significant area of New South Wales is also affected by water and wind erosion. For years concern has been expressed regarding the effects of the various forms of saline contamination of water and soils, but because of the limited legislative mechanisms the magnitude of the salvage operations has been blurred through saline seepage, saline scalds, dry land salting and irrigation salinity, and thousands of hectares of land have been either permanently or temporarily degraded. I will use Victoria as an example; it is estimated that 45,000 hectares is affected to varying degrees by saline seepage alone. This occurs mainly in the foothills and associated plains of the north, central and north-east regions where clearing of the stabilising vegetation has taken place. What is frightening is that the damage to some areas is considered to be irreversible, at least in the short term. This, I think, highlights the point that was made by the honourable member for Farrer when he said that it is probably two minutes to midnight for the reclamation of the Murray-Darling Basin. The remediation efforts that must be made will require intensive effort on the part of Federal, State and local governments and the farming communities. As well as gradually degrading large tracts of otherwise useful land, the gradual buildup of salt and other pollutants, such as phosphates and agricultural chemicals, will make it more and more difficult and more and more expensive for rural communities within the Murray-Darling Basin to purify the water and to make it reasonably potable. There are a number of other problems related to land usage in the Murray-Darling Basin that makes a comprehensive understanding of the land and water characteristics of the zone an absolute imperative. It is to be hoped that the establishment of new arrangements for the River Murray Waters Agreement, as outlined in the River Murray Waters Amendment Bill, will pave the way for a much improved management regime for the entire area. As indicated earlier, the four governments concerned-the Federal Government, the New South Wales, Victorian and South Australian governments-have all agreed to legislate concurrently and in such a way that an institutional framework, agreed upon by all and intergovernmental in structure, will be established to facilitate and support State-based initiatives. I think it is not exaggerating to state that stark evidence of degraded land and increased expenditure to maintain returns from both arable and pastoral activities have provided an inescapable logic for all concerned. It is on this base that the operations of the Murray-Darling Basin Ministerial Council will be established. What is heartening is the evidence of a holistic approach to the problem of sound, efficient and co-ordinated management. The fact that all four governments will be represented in the Council by Ministers from the portfolios of water, land and environment testifies to the new understanding of the more comprehensive aspects of the total resources of the region. It is to the credit of the Labor governments in the three States and the Commonwealth that the new arrangements have been made. It has also been recognised that the success of this new arrangement cannot be expected without the involvement of local communities in the decision making process. Likewise, any hope of success will necessitate the development of an informed population in this vast region. The provision within the Bill for the formalisation of a Community Advisory Committee is aimed at forging the communication link between the Council and the communities so integrally involved. I note that the Minister has stressed that the Bill aims not just at providing information at the local level but also anticipates that local communities will come to accept considerable responsibility for ensuring the improvement of the resources of the basin. In fact, the Community Advisory Committee has been established since the end of 1986 under the Chairmanship of Professor John Burton. Considerable work has already been accomplished. A program of community workshops has been initiated with the first two being held in Echuca and Mildura. Obviously the work that must be done must be ongoing. Not only must degraded resources be reclaimed and areas of risk protected but also new management techniques must be developed and put in place. It must be recognised that the use of the Murray-Darling resources has not always been made on an equitable basis. This was the point made by the honourable member for Boothby (Mr Steele Hall). This applies particularly to the qualitative and quantitative aspects of water usage as well as the long term responsibilities that this generation has to future generations where resource management and utilisation are concerned. Those who live along the Murray downstream of the confluence of the Goulburn and Murray rivers are acutely aware of the quality of water for farming and domestic purposes. The farther downstream communities are located, the more concerned they become. It will be the responsibility of both Council and Advisory Committee to ensure that equity is built into all deliberations regarding resource usage. There are many Bills that reach this House that can be claimed to be important for the future welfare of this country. However, I am convinced that this Bill is concerned with an issue of a most fundamental kind to the future prosperity of this nation. If we are not to follow the example of northern Africa we must come to place great importance on the significance of the Murray-Darling Basin. I commend the two reports which most honourable members would have seen, the Murray-Darling Basin Environment Resources Study-Murray-Darling Basin Ministerial Council and the technical report River Salinity, Waterlogging and Land Salinization-Towards an Integrated Management Study. I commend these reports to anybody in this country to read. We have ample evidence of economic and environmental significance to the nation of this area and the irrevocable evidence of its vulnerability. It is not too late to put in place the appropriate management structures. This Bill provides a legislative trust for such measures. No one in his right might could advocate anything but the most wholehearted support for the measure. I certainly support the Bill. I do not support the amendment. I wish the two bodies great success in their enormously important task and I commend this Bill to the House. Mr DOWNER(Mayo)(9.58) —It is with great pleasure that I support the River Murray Waters Amendment Bill. As somebody who has had a genuine and lifelong involvement with the River Murray and its problems, the introduction of this legislation gives me real pleasure. I have often argued in this House and elsewhere that the two greatest environmental issues that Australia faces are soil degradation and water resources. It is of real concern to me that those two environmental issues, so important to our nation, seldom get mentioned in the city based national media and are so seldom part of the advocacy of some of the environmental groups such as the Australian Conservation Foundation. The Murray-Darling system is, I think, arguably Australia's greatest natural asset. I do not say that because it happens to run through my own electorate. One-seventh of the Australian land area is affected by the Murray-Darling Basin. One-third of the output from our natural resources sector comes from the Murray-Darling Basin. That basin supports some 25 per cent of our cattle and dairying industries, 75 per cent of our irrigated land, and 50 per cent of our sheep grazing and crop lands. For me as a South Australian it is an enormously important source of water for my State. It is often forgotten that during periods of extreme drought, South Australia can draw up to 80 per cent of its water from the River Murray, quite an incredible fact. Yet, in spite of the immense importance of the Murray-Darling system to this country, it still faces great significant problems despite the efforts in recent years by governments such as the Fraser Government whose work in this area has often gone unreported and unapplauded, although it did a great deal. All these problems that the Murray-Darling Basin faces are in different ways inter-related, but the big loser from all of these problems is eventually my State of South Australia and, more specifically, my electorate, which includes the mouth of the River Murray. Therefore my constituents inevitably end up with everything that has been thrown into one of the longest river systems in the world. I assure the House that all South Australian Liberal members of parliament will most certainly fight to ensure that our State gets a good deal in the whole issue of the future of the River Murray. That is why I observed that of the five members of the House of Representatives from the Liberal Party from South Australia, four are participating in this debate, and only one out of the eight Labor members from South Australia is participating-an interesting contrast. The first of these great problems that have to be faced along the Murray River and in the Murray-Darling Basin is the problem of land use. In spite of the great deal of work that has been done by the primary producers and by governments at different levels, there is still a significant degree of overgrazing of semi-arid and arid pastoral areas in the basin. There is still over-cultivation of some crop lands and there are still inappropriate irrigation techniques being used. The result of all of this is a significant decline in soil structure, wind and water erosion, salinity, about which others have spoken at some length, and soil acidity. The new Murray- Darling Basin Ministerial Council, in its report which was referred to by the previous speaker, the honourable member for Ballarat (Mr Mildren), says that the mistakes in land use planning are now leading to a decline in annual production of some $220m. So we can see that there is always that close correlation between efficient and responsible land use and economic return. These land use problems require urgent action, and that urgent action has, as its main theme, the co-ordination of land use, which is absolutely vital if we are to get solutions to those problems. We need a co-ordination of drought policies and we also need, let me emphasise, funding for soil conservation, something which is very low priority with this Government. In this financial year it is providing just $6m for the national soil conservation program, but it is providing to a body such as the Office of the Supervising Scientist $5m alone. Yet remember what I said at the beginning: soil degradation is one of the greatest environmental problems facing our nation. The second major problem as far as the Murray-Darling system is concerned is the problem of water quality. Others have spoken of the growth of salinity and turbidity as the river continues to wend its way west. Salinity has always existed in the River Murray. It is nothing new and it was not brought there by European settlers. But the land use decisions since European settlement have seriously exacerbated the levels of salinity, and the loss of tree cover has also been a very major problem. In 1981 the levels of salinity in South Australia rose to record highs and it was a time of very great concern for all inhabitants of my State. Those problems have not returned since, largely because there have been good river flows. I say that by way of a warning, because that problem of salinity still remains a very serious one and, if we have a drought, that level of salinity will return. Action is necessary and the action must be co-ordinated. We need integrated catchment management throughout the basin, we need co-ordinated ground water management programs, we need co-ordinated surface water policies and we need co-ordinated waste water management. All of those things require serious and important co-ordination. The third great problem of the Murray-Darling system is the need for protection of the natural ecosystem. The natural ecosystem in the Murray-Darling system has been the big loser over the past 200 years. Let us remember, by way of example, that there are some 7,000 discrete wetlands in the Murray-Darling system, which is an enormous number. But the natural ecosystem of the Murray-Darling has changed very dramatically since 1788. Some of the recreational and economic uses of the system have been extremely environmentally insensitive. Again, we need much better co-ordination of recreation and economic policies, and we need a significant improvement in the levels of research to ensure that the natural ecosystem of the Murray-Darling system is properly protected. The fourth major problem, and it is a related problem, is the need for the protection of the natural flora and fauna of the system. The native vegetation in the Murray-Darling system is now some 50 per cent of the native vegetation present when European settlement occurred. Less than 9 per cent of native vegetation is left in the wheat and sheep belt. Ten plant species are now extinct and 37 are endangered; 20 mammal species are extinct and 16 are endangered; and 35 bird and reptile species are also endangered. Again, we need action. We need action quickly and that action has to be co-ordinated to ensure that we get effective conservation strategies and effective management plans. Revegetation is vastly important in the Murray-Darling system, and is not spoken about often enough either in this House or in the national forums, particularly in the media. As others have said before, vegetation clearance has led to rising ground water, and that has brought about the problems of salinity, about which we have spoken so much. The national tree program should be more directed towards the Murray-Darling system, and I think it deserves significantly greater funding than it currently gets. If I could use language which is not exaggerated, I think it is pathetic that the national tree program in this country receives less than $1m per annum in funds. When we think of the hundreds of millions of dollars that are pumped into all sorts of schemes, it is simply incredible that the national tree program is apparently regarded by the Government as discretionary and not terribly important. Yet it is fundamental to the survival of the Murray-Darling system as an effective river system. We do need effective action in all of those four areas that I have very briefly described. We have a long history of trying to address the problems of the Murray-Darling system, and everybody knows that. If we go back to the constitutional debates at the end of the last century, we will see that the South Australian statesmen were arguing vehemently for the Murray-Darling system, particularly for the River Murray itself, to be controlled at the national level. That is not something which is argued for particularly vehemently any more, and I will not comment too much on that. But certainly in the last century it was a cause celebre for the South Australian farmers of the Australian Constitution. They did pretty badly because, as the downstream States, we ended up with section 100 of the Constitution, which hands the whole thing, lock, stock and barrel, over to the States and ensures that the Commonwealth does not get too much of a look in. I suppose that is a problem for South Australia, although people from other States seem to think that is an appropriate solution. We fought in the last century, and I can tell the House that we will keep fighting, and I suspect it will be members from both sides of the House. When I was elected to the Parliament I made a statement on 6 March 1985. It was one of the first Press releases I put out as a member of Parliament and it was at the time of the launching of the River Murray Interpretative Centre in the town of Goolwa in my electorate. I said in that Press release that I thought that, whilst the River Murray Commission, as it then stood, had done an excellent job, it should be replaced by a national co-ordinating authority for the whole of the Murray-Darling system. I received some criticism for making that statement. I would have to say that I regard that criticism as a little ill-informed. I am glad to say that this legislation that the Government has finally brought forward is-I would not be so vain as to suggest that it was based on my one Press release-coincidentally in line with what I was talking about back on 6 March 1985. Perhaps I am being too modest, but I suspect that the Government's initiative was pushed along largely by other sources. Naturally, as somebody who has held those views for many years, I welcome the establishment of the Murray-Darling Basin Commission replacing the River Murray Commission, its Ministerial Council, which it must have, and also the Community Advisory Committee about which I have not time to speak. It is important to get direct community involvement in the management of the Murray-Darling system. It would be foolish to do anything other than that. The new arrangements, the new Commission and the new Council will have a broader geographical responsibility, and that is important. It is disappointing that the old Government decided not to become involved in this great enterprise. I hope that in future the Queensland Government will reconsider its position. The legislation also provides for a broader scope. We are dealing not just with water quantity, which is where the River Murray Commission started off, or with water quality, in relation to which the Fraser Government expanded the role of the River Murray Commission, we are dealing also with the land and environmental matters of which I was speaking earlier. It is argued-it is certainly argued quite strongly on this side of the House-that these new arrangements are somewhat cumbersome, and that is true. In an ideal world it would be easy to say that they are too cumbersome and that we should streamline the arrangements and make them simpler. If only that were possible, but section 100 of the Constitution means that we can do little else but continue with cumbersome arrangements which involve all the States and the Commonwealth, and all the portfolios in the States and the Commonwealth which relate to the efficient management of the system. It is cumbersome, but unfortunately I see little alternative. I congratulate the Government on this initiative, and I am glad that it followed up my suggestion of March 1985 Mr PORTER(Barker)(10.12) —There is no doubt that the importance of the River Murray system to the nation cannot be overstated. It is the lifeblood of such a large area of our continent. Economically it supports up to 500,000 people in the Murray Valley alone. South Australia, as my colleagues have already said in general terms, relies particularly on the Murray as its basic source of domestic, agricultural and industrial water supply for a large proportion of the State. Adelaide and the surrounding areas of around one million people rely on average for 46 per cent of their water from the Murray. In a dry year up to 90 per cent of their water comes from the Murray. In addition, pipelines from the Murray supply the Iron Triangle towns and there is a pipeline that runs south into the upper south-east as far as Keith. Further, the Riverland areas of South Australia, the area from Renmark down to Morgan or Waikerie, is a major producer of grapes for wine production as well as for drying together with stone fruit and citrus. The latter is grown for juice and for fresh fruit sales both here and overseas. All that intensive horticultural production relies on irrigation, again from the Murray. It is abundantly clear that as South Australia is the driest State in the driest continent, the Murray is indeed its lifeblood. It follows the not only are South Australians most concerned to ensure that we continue to have access to a reliable supply of water but also that in recent years there has been increasing concern that we have good quality water. This has been particularly the case with the increase over time of the level of salinity of the water we receive. A high level of salinity is not only a health risk, but also it provides enormous problems for irrigators who will suffer a significant loss of production if forced to use saline water. Whilst there has been general recognition of the danger of allowing the salinity level to rise, the action taken to date does not inspire confidence that we have the problem under control. Mr DEPUTY SPEAKER(Mr Rocher) —Order! It being 10.15 p.m., the debate is interrupted. I propose the question: That the House do now adjourn. Mr Peter Morris-I require that the question be put forthwith without debate. Question resolved in the negative. Debate resumed. Mr PORTER(Barker) —I was referring to the problems of salinity control and now wish to refer the House to the annual report of the River Murray Commission. The latest annual report we have from that Commission is its sixty-ninth report, for the year 1985-86. I do not know why it takes the Commission so long to table reports in this place. This report for the years ended June 1986 was tabled on 17 November 1987. The Parliament and the Australian people deserve better than that. I do not know the reason for the delay, but a report that is 16 months late runs the risk of becoming almost irrelevant. Let me quote from the report to emphasise the concerns of South Australians, and indeed of all Australians, about the rising salinity level of the River Murray waters and the action that is being taken. The Commission on page 18 of its report says: The Commission is continuing to work towards the acceptance by Governments of a comprehensive Water Quality Management Plan and has adopted the following objective for salinity control. It says that its objective is: To support an economically, socially and environmentally acceptable package of works and measures comprising salt interception, dilution and land management (including the possible admission of drainage to the River Murray) which will result in the salinity of the River Murray, as measured at Morgan, being reduced so that, by 1995, it will be less than 800 EC for 95 per cent of the time. Given that the World Health Organisation has determined that 830 electric conductivity (EC) units is the upper limit for human consumption and that Morgan is the start of the pipeline to Adelaide, I would have thought that the River Murray Commission's objective was a minimum requirement, not an objective to be worked towards. The Commission is saying that it wants no more than 800 EC units for 95 per cent of the time. That is only 30 EC units below the World Health Organisation's upper limit for human consumption. I regard that as a minimum requirement, especially when one examines the EC readings at Morgan as provided in the annual report. At page 49 one sees the monthly EC readings for 1985-86 at Morgan, which range from 1,110 EC units in July 1985 down to 510 in October, and rising again to 990 in June 1986. At present according to the River Murray Commission's annual report, the EC readings are far in excess of World Health Organisation recommendations, and far in excess of what it is aiming for as part of its objective for 1995, which is 800 EC units for 95 per cent of the time. The problem is that South Australia is not its own master in these matters. Certainly we must ensure that we control the amount of saline water entering the system on our side of the border, but there is little that we can do about what happens in Queensland, New South Wales and Victoria without the co-operation of those governments. I highlight the problem by again referring to the annual report of the River Murray Commission. In relation to salinity-and this is just one example of where the salinity is coming from-page 19 of the report states: Barr Creek is the most significant single source of saline water in the River system. In order to ensure that the honourable member for Murray does not get upset, I recognise that work is being done in relation to Barr Creek. But this is just one example of where saline water is entering the river system. The report goes on: and, although flows from Barr Creek are generally low, they can affect salinity along the entire downstream length of the River Murray. In August, heavy rain across the south-eastern catchments of the Murray produced minor flooding, flushing a `slug' of highly saline water from Barr Creek into the Murray. As it moved downstream this `slug' produced the highest salinity recorded in the monitoring program at Euston (945 E.C. units compared with a previous maximum value of 514 E.C. units). That just points out that whatever we do in South Australia we are susceptible to what takes place in Victoria, New South Wales and Queensland. Some work is being done-as the honourable member for Murray would want us to acknowledge and which I have acknowledged-and the River Murray Commission says that during 1985-86 the operation of salinity mitigation schemes resulted in an estimated 231,600 tonnes of salt being prevented from entering the River Murray. But even so, unacceptably high salinity levels are still being recorded. Therefore, action must be taken in the Murray-Darling Basin to ensure that we take care of this immensely valuable national resource. There is growing frustration with the view that to expect all the State governments involved to co-operate in concert with the Commonwealth, to protect the interest of each other-sometimes to the disadvantage of or against their own individual interests-is a forlorn hope. Under our Constitution we have to seek a co-operative approach and frustration arises because more action is needed. Therefore, when the then Minister for Resources and Energy, Senator Gareth Evans, on 27 March this year issued a statement suggesting the problem was to be solved, he raised great expectations. He said: The Federal Government and the Victorian, New South Wales and South Australian governments agreed in Melbourne today to create a Murray-Darling Basin Commission to combat salinity and environmental problems in South-East Australia. He went on: . . . the four government, three State agreement was `historic' and provided a framework to overcome the degradation of resources in the Basin, which was something that Governments had been trying and failing to do since Federation. That all sounds great. But my fear is that the great expectations that Senator Evans raised will not be fulfilled. By looking at the legislation itself, we see that the new Commission will have no additional constitutional power. It will continue to exercise the traditional authority to regulate the flow and division of Murray River water between the three States. It will continue to exercise the authority or the more recent power given to it over water quality in the river and the advisory function of water quality in the State rivers flowing into the Murray. The stated purpose of the new arrangement encompassing the Murray-Darling Basin is to broaden the advisory role to include land, water and environment management in the basin and, hopefully, by the inclusion of the responsible Ministers and officials, obtain greater co-operation and co-ordination in the policies of each of the governments in relation to the region. I earnestly hope that it achieves its objectives. But I am less convinced that the Government understands that this should be amongst its highest priorities. In particular, I note there is no commitment to additional finance to assist in the control of salinity, high water tables, drainage and so on. The new arrangement involves more State Ministers. Whether that will help or hinder decision making in this co-operative venture, we will have to wait and see. Certainly, the new arrangement appears to be extraordinarily bureaucratic. I believe that in the main, solutions to the problems-especially salinity-are known. It is more a matter of getting on with the job. Of course, that will need a commitment from State and Federal governments which has not been forthcoming to date. Until it is, the problem will not be resolved. The previous coalition Government took the bull by the horns and made a commitment to improve our water resources under the national water resources program. The current Government has reduced spending in real terms on that commitment. In addition, in 1982-83 we had proposed a special bicentennial water program. That was also scrapped by the Labor Government. More Labor talk and legislation will not fix the problem. In particular, South Australia is reliant on action. We need action and we need it now. Mr CLEELAND(McEwen)(10.27) —We often hear comments from Opposition members in this House that the Government does not spend enough money on A or B. We often hear comments about problems with the Australian Constitution and its defects. The Constitution is a document which was framed by six Crown colonies prior to 1901 and is recognised by any intelligent Australian as having an enormous number of defects. All Australians recognise that in 1987 Australia is a Commonwealth, a nation, and no longer six Crown colonies. Yet whenever the Government comes forward and recognises the defects in the Constitution, the Opposition opposes every reasonable suggestion for constitutional reform. Tonight we have heard complaints from the honourable member for Mayo (Mr Downer) and the honourable member for Barker (Mr Porter) about section 100 of the Constitution and the fact that it does not allow the Commonwealth-the Australian Parliament-the power to take the necessary legislative steps to control enormous problems in this country. Yet, if this Government tried to resolve the problems of section 100, what would this snivelling Opposition do? It would oppose it. It would not have the courage or the conviction of its own beliefs to stand up in front of the Australian people and say that the change was necessary. So Opposition members stand up in this Parliament and, as usual, find fault with the Constitution but, as usual, they lack the courage or the conviction of their beliefs to support rational constitutional change. Then the honourable member for Barker said that the Government did not spend enough money. This statement came from a member of a party which likes to think it comprises economic rationalists. These are the people who intended to cut 16 per cent from Commonwealth expenditure at the last election, but at the same time promised to lower taxes. After saying that they would slash 16 per cent from Commonwealth expenditure, they tell us that we should increase expenditure on the Murray-Darling problems. They stand condemned by their own policies and by the nonsense that they speak so regularly in this House. I have some personal knowledge of the Murray-Darling system. For seven years I lived on the banks of the Murray River in a little town called Cohuna in the Murray Valley. Cohuna is some 15 miles east of Kerang and some 38 miles west of a little town called Echuca. Mr Jenkins —You were the mayor, weren't you? Mr CLEELAND —No, I never got to be mayor. I should have been, mind you. Had I been, the town would have been well served but I never had the chance. Two speakers tonight have spoken about the infamous-or the famous-Barr Creek. Barr Creek emanates from the Cohuna irrigation area. It flows from the dairy districts of Cohuna, its flood irrigation zones, back into the Murray River. It is a fascinating creek. Some years ago, long before flood irrigation was introduced, the Barr Creek was a lovely, meandering little river. It was renowned for its duck, quail and snipe habitats. Snipe is an endangered species today. They travel from Japan and breed in this country. Barr Creek, because of its undergrowth and its surrounding ecological systems, was well known as a breeding ground for Japanese snipe. The creek was very good fishing. It was full of warm water fish unique to the Murray-Darling system-the callop, the cod, the bony bream, the grunter, the black bream-unusual fish dependent upon a very rare ecological system, the Murray-Darling system. The long-necked tortoise and the Murray River crayfish, found nowhere else in the world, bred there. This is what the Barr Creek used to be. Then along came the Victorian State Rivers and Water Supply Commission some years ago and said, `We have a problem in the Murray district. We are flooding all the farms with water from the Murray, which is creating a lot of salt. We need some system to get the salt away from the farms and back into the Murray River'. So they got their surveyors out who pegged little markers all along the old meandering Barr Creek and straightened it. They got rid of all the undergrowth, the rushes, the cumbungi- Mr Jenkins —What happened to the creek? Mr CLEELAND —It is no longer a creek. It used to be a creek. It is now a salt water drain. There are no longer any fish in the Barr Creek. No longer do ducks or Japanese snipe breed on the Barr Creek. As I said, it is a straight, salt water drain. Not one bend is left in it. We did this as a society because we allowed to develop in Australia a system of flood irrigation, which we now know to be ecologically disastrous. At very subsidised prices we allow farmers to divert water from the Murray River and, by flood irrigation methods, to flood flat land. It is a most uneconomical method of providing water for agricultural purposes. Even with modern techniques, such as laser grading, which requires a less gradual slope on a paddock for the flood irrigation system to work, we nevertheless use probably less than 30 per cent of the water applied to the ground which is actively cost-effective in the production of crops or dairy products. The rest of the water simply runs across the land, goes back into the delta systems and then into the Murray system again. It is an enormously non-cost-effective means of providing water. But that is the system which previous governments have developed. It is still prominent in New South Wales. In the Colleambally, Griffith, Tongala, Shepparton and Cohuna districts our fruit and dairy producers and rice growers so often use their water in a non-cost-effective and ecologically dangerous way. We get increased water tables by this method and produce, from what was once an inland ocean-the whole of Australia was once an inland ocean-great amounts of salt. With flood irrigation the salt flows back into the system. Areas like the Barr Creek become almost pure salt. What do we do with it? We put it back into the Murray River. The honourable member for Barker apportions blame to Victoria, New South Wales and Queensland. That is pretty weak. He forgot to mention that Renmark delivers nine tonnes of salt per day during the irrigation season into the Murray River. It is fair to say that that nine tonnes of salt is not the worst problem. If one looks at it analytically, Renmark is not the most salinity-producing irrigation area in Australia. But it does not help much when honourable members from South Australia say that it is our fault when South Australia has not yet resolved the problems of the Renmark irrigation system, and when the State Government of Victoria still, at subsidised rates-- Mr McVeigh —This is old know-all talking. Mr CLEELAND —I know a damned sight more about this subject than the honourable member, who comes from dry Queensland. The reality is that this country will not solve the salinity problems of the Murray River until such time as the State governments properly recognise their responsibilities and take proper measures to resolve the problem. Opposition members interjecting- Mr CLEELAND —Of course, those bleating so loudly on my right are representative of the parties that created the problem. It was the National Party in Victoria which, in post-war years, said, `We need soldier settlement schemes'. It was the National Party in Victoria which cut up prime broadacre farm lands into soldier settlement blocks and put soldier settlers on them. It was the National Party which made uneconomic agricultural holdings dependent upon irrigation. It was the National Party which did all this in Victoria and, in fact, encouraged it in New South Wales. The result is that, since the National Party did this, to take the Shepparton area as an example, when I was a young man, some years ago now-- Mr McGauran —A long time ago. Mr CLEELAND —It was a long time ago. I recall that around Shepparton we had hundreds of soldier settlers on blocks of no more than 10 acres. Of course, at the end of the post-war period, when all these 10-acre blocks became productive, we overproduced. At about the same time as we overproduced stone fruits, the British joined the European Economic Community. In those post-war years we found hundreds of farmers put on these little blocks by the National Party, dependent upon irrigation water and with no market for their product. If honourable members opposite want to bleat about the history of farming in this country, I will take them on day after day, because I know their history. They have done more damage to farmers in this country than any other party, and they stand condemned for what they have done to farmers. If they want to bleat in this House about what farmers are on about, I will take them on any day of the week. I know their history better than they do. The irrigation problems that they have caused by these close settlements are the problems this country faces today. Yet they still come into this House, forgetting their history and forgetting that their policies in the past in this country created irrigation districts which are no longer necessarily economically responsible-and they bleat. They do not know their own history, they do not know what they have done and they are ignorant. Opposition members interjecting- Mr CLEELAND —Mr Deputy Speaker, do you see what I mean? When one tells the truth in this place they are like a paddock full of ewes-they bleat. The problem of the irrigation system in this country will be improved by this legislation; there is no question about that. It is a step in the right direction and I am pleased that the Opposition, including members of the bleating National Party, is supporting it. They do know when somebody is doing the right thing, but they never know when they have done the wrong thing. I am pleased that they are supporting this legislation, but I still believe that we will not solve the problems of salinity in the Murray River until the State governments, whatever their political colours may be, take full responsibility for the low cost of irrigation waters, take responsibility for the historical past which has created flood irrigation districts of Australia and take responsibility for the fact that each State, be it South Australia, Queensland, Victoria or New South Wales, is individually creating the salt problem. The Commonwealth Government can only set forth the procedures to enable people to negotiate and solve the problems. It will be the States' responsibility. I hope and believe that it is a step in the right direction and I have great confidence that, in the future, this problem will be solved. Mr HICKS(Riverina-Darling)(10.40) —Mr Deputy Speaker, I just listened to the honourable member for McEwen (Mr Cleeland), and I have never before heard a speaker in this House sound so convincing but speak so much drivel. I must invite the honourable member for McEwen into the Murrumbidgee and Coleambally irrigation areas one day to address the farmer groups there and hear what they have to say about what he is trying to present to Parliament tonight. But enough of the honourable member for McEwen. I think we can discard what he said, because it is absolute nonsense. The River Murray Waters Amendment Bill 1987 replaces the River Murray Commission with the Murray-Darling Basin Commission which, in addition to assuming the statutory responsibilities of the old commission, will play an advisory role to the Murray-Darling Basin Ministerial Council on water, land and environmental matters in the Murray-Darling Basin, not covered in the 1982 River Murray Waters Agreement. The Commonwealth Government and the State governments of New South Wales, Victoria and South Australia will each provide two commissioners to represent water, land and environmental interests. The Bill also establishes a Ministerial Council comprising three Ministers from each Government who are responsible for water, land and environmental policies. The previous ministerial arrangements were for water Ministers only. The Bill being debated today also establishes a Community Advisory Committee made up of approximately 17 representatives of regional and national organisations which will bring together and present to the Ministerial Council community views on the management of the natural resources of the Murray-Darling Basin. I hope the Ministerial Council takes particular notice of this Committee's recommendations. It is important that co-operation between the Ministerial council and the Community Advisory Committee is practised. Given the fact that the Advisory Committee has no powers, and given the additional bureaucratic structure of the Commission, it will be very easy for the Ministerial Council and the standing Committee to ignore the concerns of the regional and national advisers. An organisation of great standing that will have representation on the Advisory Council will be the Murray Valley League, which for many years has carried the battle to protect the environment of the Murray Valley almost alone. The point is very important as the landholders and the people of the Murray-Darling Basin who rely on the water are extremely concerned about the present and future water quality and land management practices in the basin. One of the big problems hampering the revitalisation of the Murray-Darling Basin is associated with salinity, and many speakers have touched on that tonight. There is a very major salinity problem in some areas along both the Murray and the Darling. The severity of the problem is highlighted by the fact that 26 per cent of the total land area in the State-sponsored irrigation schemes in the Murray-Darling Basin-an area equivalent to about 65 per cent of the area actually irrigated-is affected by shallow water-tables. In addition, 10 per cent of the area actually irrigated is now salt affected. It is estimated that, without intervention, in New South Wales, the area with shallow water-tables, will extend from about 200,000 hectares in 1985 to almost 300,000 hectares by 1995. This area is almost entirely in the riverina plains zone with the largest potential increase occurring in the Coleambally irrigation area. Salinisation causes a reduction in productivity and reduces the variety of produce able to be grown. In areas of salinisation, farm enterprises are usually restricted to pasture-based enterprises and shallow-rooted annual crops. This has the effect of reducing a farmer's ability to change his crops in response to varying market conditions. There is, however, as with many problems Australia has faced over the years, a bright spot on the horizon through the good work of the Commonwealth Scientific and Industrial Research Organisation (CSIRO). Through its research, this organisation is working towards showing to those using the Murray-Darling River system-or, for that matter, any freshwater supply in Australia-a correct production management program on a substantial basis. The main aim is to understand how to manage the catchment system so that it remains productive into the future. Unfortunately, in some cases these programs may mean the forgoing of short term profits in order to enable long term viability. This refers particularly to irrigation cropping systems such as rice. The CSIRO in Griffith and Albury, under the leadership of Dr David Mitchell, is carrying out invaluable research and is working in close liaison with the New South Wales Department of Agriculture and other State government departments. The Fresh Water Resources Centre at Albury is examining ways of controlling and improving water quality that often owes its poor state to its use in irrigation areas. Unfortunately, the new legislation will not help this research because, as in many areas, the CSIRO is suffering the effect of funding cutbacks. One problem is the loss of staff and, although it is not crucial at the moment, the Government must be careful not to let staff numbers drop below those levels essential for the viability of the operation. The CSIRO has been asked to seek the support of the private sector but, unfortunately at present, the productive sector with which the CSIRO Fresh Water Research Centre is allied, is not particularly viable and is itself finding it difficult to survive. As CSIRO scientists point out, if they do not succeed in their research and the Murray- Darling Basin is not managed correctly, no enterprise in the basin has a future. The river system is essential to life. With all the obvious concerns and long term implications of increasing salinisation, it is incredible that the River Murray Commission is to receive a new management structure and yet no extra finance to assist with improvements to the waters of the Murray- Darling Basin. Mr Nehl —No extra money? Mr HICKS —There will be no extra money. Many of the government-sponsored irrigation schemes of the Murray-Darling Basin were developed at the beginning of this century. Today we have an inefficient and inadequate irrigation infrastructure or, in some cases, lack of infrastructure, contributing significantly to the problems of river salinity, waterlogging and land salinisation and constraining more efficient water delivery and use. Today there is a total of some 13,500 kilometres of supply channels and 7,000 kilometres of drainage channels to support State-sponsored irrigation in the basin but because of age, construction materials, the soils on which they were built, the design capacity and changing water demands, much of these are now assessed as being deficient in terms of their ability to supply current irrigation demands or to deliver or remove irrigation water efficiently and effectively. In total, 41 per cent of the supply channels are considered inadequate to varying degrees, the highest proportion being in New South Wales schemes. The major problems relate to the insufficient capacity of many existing supply systems to meet adequately today's irrigation demands and many irrigators therefore receive water on a roster system, which often cannot be tailored to actual crop needs. Another major problem is in relation to leakage. Many supply and drainage channels leak. It has been estimated that in New South Wales some 25 per cent of ground water accessions are from channel seepage. In addition there are over 42,000 water control structures in the irrigation schemes in the basin, and about 12,000 are considered to be variously inadequate to some degree in terms of water capacity or excessive leakage. The constraints imposed by existing infrastructure, or a lack of infrastructure, will become more critical as irrigators strive to adjust to changing market conditions and governments try to introduce efficiency-motivated policies such as transferability of water entitlements. The limited capacity of many supply systems will prove an increasing constraint to more efficient irrigation water supply and use, and the lack of drainage infrastructure will increasingly add to major land degradation and losses in agricultural productivity. The Fraser Government demonstrated some foresight in January 1983, when it announced a special water resources development. It was intended that the coalition would spend $70m per annum over five years as a bicentennial program aimed at accelerating the development of new water resource projects. These projects involved the construction of additional infrastructure and the upgrading of worn out or obsolete infrastructure. As history tells us, the coalition was defeated not long after that commitment was given and unfortunately for the Murray-Darling Basin, the current Federal Government never honoured the coalition's commitment. This commitment to water resource improvements was to be funded in part on a dollar for dollar basis by the States. But of course, in New South Wales the State Government regards the provision of water to users as a subsidy, as does the honourable member for McEwen. It talks about the user pays system and describes its July 1987 decision not to increase water charges as being a subsidy to irrigators, which is totally wrong. All governments should charge for water on the basis of the cost of delivery and not for the actual resource, as water is a renewable commodity which enables the provision of cheap food for Australia, as well as providing export income for our nation. There is a general theme running through speeches given recently, particularly by some New South Wales and Victorian State Government bureaucrats. While not obvious to some they still point out that their Governments believe that the so-called user should pay. The user, of course, they regard as being the irrigators and they intend to price water in such a way that will, first, allow for capital works such as dams and storage works to be paid for by the irrigator; secondly, make the irrigator pay for the water, which is wrong because water is a renewable resource that does not belong to Government; and, thirdly, use the high cost of water as a means of reducing its use. What it is difficult to get through to the bureaucrats and politicians who push this line is that to increase the cost of water much more would destroy the viability of many irrigators who are presently providing relatively cheap food for the domestic and overseas markets. In the area of on-farm works and measures, the Murray-Darling Ministerial Council has recommended the use of improved irrigation methods such as land forming and the recycling of surface drainage water in the Riverina Plain. These have the potential to reduce accessions to the ground water as well as reducing waterlogging and land salinisation. However, the report admits that the current economic situation facing many irrigators makes it difficult for new and improved irrigation techniques to be practised. If the Government were fair dinkum, it would be providing a more generous write-off provision than it has. Recently the New South Wales Government changed the name of the former Water Conservation and Irrigation Commission which then became the Water Resources Commission to the Department of Water Resources. Close to home, in the Murrumbidgee and Coleambally irrigation areas, we find a concentration of irrigators growing rice and horticultural products. Because of the good management practices in that area, no salt enters the River Murray from the Murrumbidgee River. The manager of the Department of Water Resources, Mr Mark Smyth, and his experienced staff carry out the often unsung but invaluable work of caring for the physical well-being of the vast Murrumbidgee and Coleambally Irrigation Areas. As a matter of fact, Mr Deputy Speaker, today one of those people who has been with the Department of Water Resources and its predecessors for 43 years, Mr Laurie Fletcher, retired from the Griffith office of the Department. I know all honourable members would wish him well in his retirement. Mr Deputy Speaker, I know that some of my colleagues wish to speak, and although I have much more to say about the irrigation systems and this Bill, I shall conclude my speech. Mr COWAN(Lyne)(10.51) —Practically all the speakers who have contributed to this debate are closely involved with the River Murray because their electorates are in South Australia, Victoria and New South Wales. I am from New South Wales, but I am not directly involved so far as my electorate is concerned, but as an Australian I am very concerned about it. Mr Tim Fischer —And a former Minister for Water Resources. Mr COWAN —I have had quite a lot to do with water resources in the New South Wales Parliament. I found it particularly interesting that the honourable member for Farrer (Mr Tim Fischer) a moment ago referred to some early experiences. I can recall the time that he took me into the Wakool area and we saw people pumping salt water 1 1/2 times saltier than the sea into the River Murray because of an experiment that was approved by the Department of Water Resources at the time to reclaim land that was severely affected by salt. As the honourable member will recall, that was successful. We also went to see a farmer who had a one-year-old car in his garage, but the sump had rusted out of that vehicle. It was an arid zone, a very fertile part of Australia, but practically the whole of that district had gone out of production because of salinity. Therefore, all Australians are worried about the situation in the Murray Basin generally. It is so essential to us as parliamentarians that we become involved. Of course, I have always been a very strong States righter and I respect the fact that the States themselves have been jealous about their water resources, their share of the water, the quality of the water, the drainage of their fields, and particularly of the production that comes from those fields. Since 1917 the three vital States have been closely associated with each other under the operation of the River Murray Commission. With the settlement of the European race in Australia and the agriculturalists who went into that very fertile part of Australia but who could not produce without an adequate water supply, the Commission was able, over a number of years, as the honourable member for Murray (Mr Lloyd) and the Minister for Resources (Mr Peter Morris) clearly outlined earlier, to develop that area and harness additional water resources as the need actually arose. That was essential. The Murray Basin generally grew as the demand for water by Australians grew. I have been to India and observed, 1,000 miles from the coast, salt rising up through fertile land of almost 1,000 feet of alluvial soil. That was also because of irrigation over a very long period. The honourable member for McEwen (Mr Cleeland) may criticise the fact that proper standards of agriculture have not been applied in irrigation areas, but farmers did not know that mistakes were being made; those farmers were not to blame. They were advised and encouraged to flood irrigate the land. In the future they may have to do the same thing, but we know more about drainage today. We know what the practices should be, and better farming methods must be used, and they will be used as the years go on. I do not want to say much about the technical side of the Murray water resources and what is being done, but let me say this: I hope that over the year ahead, when we look at the need for water resources in Australia, State and Federal governments will join together to fund essential water development projects for the benefit of this nation. We have a great responsibility to feed the people of the world and to make it economic for our farmers to produce on their farms, and the only way in which they can do that is by being able to irrigate in all types of seasons to grow the crops that they wish grow. This is essential. We must never criticise the Ord scheme. Maybe it was premature but is it not great to see us do something before time? The Ord scheme would certainly have succeeded and would have been producing crops if the growers had been able efficiently to market the product. The problem with the Ord scheme is that it is so far removed from the markets it would have to supply. It was good to see that scheme built because it was undertaken when costs were low. If we undertook the Ord scheme today it would cost at least $1,000m, whereas I suppose it cost only one-sixth or one-seventh of that amount. The scheme is there for the betterment of Australian people over the years to come. Mr Deputy Speaker, it nearly makes one cry, realising the benefit of irrigation, to see our water running out to sea in all the coastal streams around Australia when that water could be harnessed to do something positive to grow the crops and increase the viability of the farmers on the land today. Mr Peter Fisher —Even for urban use. Mr COWAN —Yes. These water schemes unify water supplies for farm lands and urban areas. I refer to Adelaide. In this debate we spoke about Whyalla and other areas that depend upon the Murray. If one flies up the Murray from the sea to the east one sees how large it is. There are small streams in my electorate that are as big as the Murray is at its mouth. As the honourable member for Farrer said earlier, it is one minute to midnight for the Murray and, Mr Deputy Speaker, it is one minute to 11 o'clock now, so I must conclude. We cannot afford to let this country of ours go to waste and not take advantage of these resources that we have. They were given to us by nature and they should be harnessed by us for the benefit of the people concerned. I am delighted to see the legislation before the Parliament. The Minister for Resources and I often agree on many things. We have talked about roads in the past; we are talking about water resources now; we will talk about the fishing industry this week. Practical things are being done and I will always be happy in this House to support very practical measures whether the Government or the Opposition brings them in. The Government will always have my support, my electors' support and, I am sure, the support of the National Party of Australia while it undertakes schemes that we believe will be to the benefit of Australia. Mr PETER MORRIS(Shortland-Minister for Resources)(10.59) —I thank the 12 speakers who have participated in the debate. I think the honourable member for Lyne (Mr Cowan) finished on a very nice note, concord. It has been gratifying to hear the broad support that the River Murray Waters Amendment Bill has attracted from both sides of the House. The major point of concerns seems to be whether the Federal Government has gone far enough. Concern, moreover, has been focused in relation to salinity in the River Murray and related irrigation activity. It seems also from some of the comments that some honourable members have missed the essential thrust of the legislation. The River Murray Commission has effectively addressed river regulation. What we are now seeking to address is an integrated natural resource management in the basin as a whole. A number of speakers made the point about the size of the basin which is one-seventh of the area of this nation. Some two million people live there and some 61 local government bodies are located along the Murray. It is an enormous area, an enormous wealth producing section of our nation. We need to address the problems of the basin as a whole and how each problem relates to the other. We should not simply single out the river or the immediate use of the river as has been done on past occasions. What we are doing through this legislation is providing a co-operative framework to enable a common approach to inter-active problems in resource management. The underlining theme of this is partnership. The basin's problems can be solved only by a mutually supporting program of activities at the Commonwealth, State, local government and community levels. I again make the point that one Federal Government, three State governments, 61 local government bodies and innumerable community groups are involved. The exercise is to bring all of those differing views and differing interests together, to bring them into harmony, to bring them to an approach towards management of the basin that really addresses the problem, not just directs itself to a section of the problem. The point was made about providing more money. I repeat what I said the other night. The contributions from honourable members of the National Party of Australia particularly in debates after dinner call for more money to be spent. In the earlier part of the day there is always criticism that the Government is spending too much money, that the deficit is too high, that taxes should be reduced. We simply cannot have it both ways. It is a matter of making better use of the money that is available. Mr Tim Fischer —I opposed building a new dam. Mr PETER MORRIS —The honourable member for Farrer makes the point that he opposes the building of a new dam. I was not referring to the honourable member because he was not calling for additional money. However, I make that general point. More money is not the solution. The essential ingredient is better management. Management, not just money, is the answer to the problem we have. We are creating the opportunity to bring to bear improved management policies and strategies throughout the basin, not just along the area of the river. It is within those strategies that we will play an appropriate and responsible role as a Federal government, including in relation to finance. In partnership with the States and the basin community we will be better able to protect and to develop responsibly the crucial resources of the basin. During the debate a number of references were made-I add my recognition-to the tremendous amount of work that was done by the former honourable member for Hawker, our former colleague Ralph Jacobi. He did a tremendous amount of work and made representations on the problems of the Murray. If he were present this evening he would be very happy to see this legislation going through the Parliament. Much of the credit for it is due to him. Reference was made to the cost of the Community Advisory Committee, particularly by my colleague the honourable member for Kalgoorlie (Mr Campbell), which is in the order of $50,000 in 1987-88 and it will be split four ways between the governments concerned. Reference was also made to a substantial new bureaucracy being established. I make the point that the new Murray-Darling Basin Commission will rely heavily for expertise on the Commonwealth and, in particular, the States. There will be no new bureaucracy and no expansion of the bureaucracy. The new institutional arrangements will facilitate and focus co-operative action. Mr Tim Fischer —And the headquarters? Mr PETER MORRIS —I was coming to the headquarters. The honourable member proposed that they be located in Albury-Wodonga. The practice has been that governments have felt that Canberra is most convenient and is a central location within the basin. That has been the experience in the past. I share the points made by the honourable member for Mayo (Mr Downer) about soil degradation and water resources but I reject his criticism about not enough money being spent. He also criticised the national afforestation program. I make the point that that program did not exist under former conservative governments. It is a creation of this Government and it is being funded as we can afford it within the resources that responsible government allows at the present time. Reference was made to the contribution of Queensland. Queensland will not be represented on the Commission; it is not participating. Queensland does send an observer to Standing Committee meetings, so there is an input to that extent and there is some contribution from it. For the record, I note that Queensland constitutes about a quarter of the total basin area and about 3 1/2 per cent of the water flow, so I suspect in some of the comments earlier there may have been a misunderstanding as to how much Queensland was contributing to the problem. The tabling of the report was raised by the honourable member for Barker (Mr Porter). The problem in tabling the Commission's report is that accounts of the Commission's activities in each State-and they are carried out by State authorities on behalf of the Commission-have to be audited by each State before they are passed to the Commonwealth for clearance. That process, in itself, takes a lot of time. I am advised that in the case of the 1985-86 report there were also some additional printing difficulties beyond the control of the River Murray Commission. Whilst the delay is understandable, it is not desirable. I will be looking at means of expediting the tabling of future reports of the Commission. I conclude by referring to the amendment that has been moved by the Deputy Leader of the National Party of Australia, the honourable member for Murray (Mr Lloyd), to the second reading motion. The first part of the amendment refers to recognition of previous governments and others. I make the point that this evening quite substantive recognition has been made of people and governments of the past which have contributed to this problem. I am sure that the honourable member does not suggest that we refer to each government and each individual since 1917. I think that goes without saying. Certainly, an amendment to the second reading motion is not needed to make that point. It is supported by honourable members that recognition is due to all those who have made a contribution. The second part of the amendment refers to bureaucratic, administrative and consultative arrangements. The objective of the amending legislation that is before us is to achieve efficient action and co-ordination. The last part of the amendment is to the effect that we provide a firm commitment to finance the already known necessary remedial measures along the River Murray. I have covered that point in my explanation of the general financial arrangements. This Government will play its responsible role in the financing of whatever activities are needed. It is not simply a case of more money; it is more a case of better management of the basin and all its resources as a whole. The Government has no choice but to reject the amendment and commend the Bill to the House. Amendment negatived. 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 Peter Morris) read a third time. Motion (by Mr Peter Morris) proposed: That the House do now adjourn. Mr O'NEIL(Grey)(11.04) —I rise to place on record the need for a continuation of the Federal Government's involvement in the steel industry, either through the extension of the existing steel industry plan or through the establishment of a new steel industry plan mark 2. As honourable members will be aware, the city of Whyalla is located in my electorate. As a resident of that proud city, I am very concerned that its future as a steel producing centre may be under threat. I am most concerned at the decision of Broken Hill Proprietary Co. Ltd (BHP) to shed another 500 jobs at its steel plant in Whyalla over the next five years, and BHP's insistence that it wants no part of any steel industry plan after 1988. Why is this so when only 12 months ago BHP's group manager for information analysis, Mr Mark Pirola, was quoted in the Sydney Morning Herald as saying: . . . that BHP's steel division has become the most profitable steel corporation in the world with the lowest global operating costs . . . At the same time BHP's steel industry group managers admitted that the Federal Government's steel industry plan had provided a stable environment for investment. As late as February of this year, steel management at Port Kembla was reported in the Australian Financial Review as saying that the steel industry plan had added `timely impetus' to developments which had led to a 54 per cent profit rise for BHP's steel division in the previous financial year. Yet now we hear that BHP wants no further government involvement in the steel industry after the conclusion of the steel industry plan at the end of 1988. No government involvement in the industry would mean that there could be no guarantees about job security in the industry-indeed, it seems that BHP cannot guarantee that it will remain in the steel industry. It appears that BHP does not consider that its steel group profit of $200m in the last financial year is a sufficient return on investment. Yet return on investment is a long term proposition. Perhaps some of the new larger shareholders in BHP have become too used to making huge profits in a matter of days from shuffling papers. They perhaps do not realise that it takes years to gain a reasonable return from investment in productive industry. In 1984, the chief economist with John Lysaght (Australia) Ltd, J. N. Barber, pointed out that he thought that a five-year steel industry plan was too short. Speaking of the steel industry plan, he said: . . . it runs for five years only, a comparatively short time for heavy industry with its large chunks of investment, and long lead times for the installation of plant and for earning a return on investment. In 1982 the then Executive General Manager of BHP's steel division, Mr David Rice, said the following in relation to the time span required for a steel industry plan: Due to the magnitude of the investments required and the time to plan, design, construct and bring on line new steelplant facilities some indication of ongoing support is essential before funds could be committed. For this reason a time span for assistance of the type specified of at least ten years would be required. So even before the details of the plan had been finalised, BHP was arguing that any plan should last at least 10 years. Now, less than four years down the track, BHP wants an end to it. Yet the achievements of the plan have been considerable: It has prevented forced retrenchments from the industry; it has kept BHP's steel division open and in profit, after massive losses in the early 1980s; it has increased productivity by 38 per cent; and, apart from problems in Port Kembla earlier this year, it has improved the industrial relations climate dramatically. In fact it has been in Whyalla where the tripartite nature of the plan has had its major successes. BHP Whyalla has received no benefit at all from the bounty measures in the plan; yet productivity has improved significantly in the past four years and industrial relations have been handled by both management and unions in a most responsible manner. I wish at this point to pay tribute to the efforts of the Whyalla Trades and Labour Council, particularly Doug Elkins, John Watson, Geoff Buckland and the many other responsible unionists who have been to a great degree responsible for the excellent performance of the steel industry in Whyalla. BHP management in Whyalla should also be congratulated for its attitude toward industrial relations. It seems to me that the Whyalla experience should serve as a model for the national steel industry as a whole. I call on the Prime Minister (Mr Hawke) and all Ministers to do all in their power to convince BHP of the necessity of the continuation of the steel industry plan. Question resolved in the affirmative. House adjourned at 11.14 p.m. Mr John Brown to move- That in accordance with section 5 of the Parliament Act 1974, the House approves the following proposal contained in the report of the Joint Standing Committee on the New Parliament House presented to the House on 3 November 1987, namely: The relocation of the commencement column monument on the land axis between the old and the new Parliament House. The following answers to questions were circulated: (Question No. 28) Mr MacKellar asked the Minister for Administrative Services, upon notice, on 14 September 1987: (1) When was the AGPS Publishing and Printing Procurement Office in The Hague, the Netherlands established. (2) What are the responsibilities and objectives of that office. (3) What were the main factors, at the time of its establishment, which determined its location in The Hague. (4) How many full-time equivalent staff were employed by the office at 30 June each year from 1980-86. (5) What has been the number of (a) titles and their total value and (b) printing requests and their total value arranged by the office in each year from 1980-81 to 1985-86. (6) What was the (a) appropriated and (b) actual expenditure by the office in each year from 1980-81 to 1985-86. Mr West —The answer to the honourable member's question is as follows: (1) The establishment of the AGPS publishing and procurement office in The Hague in December 1973 was the result of a change in administrative arrangements. Prior to that date certain publicity and procurement functions were performed by the former Department of Immigration through its office in The Hague, supported under contract by a Dutch agency. (2) The responsibilities of the office are to arrange for the translation, printing and distribution of publications on behalf of Australian Government departments and agencies operating overseas. The office also procures items of general printing and stationery for Australian Embassies located in Europe. The objectives of The Hague office are to provide a service and to satisfy the need to expeditiously cover Europe and other parts of the world with up-to-date information about Australia. (3) The Hague was chosen because of cost advantages over other countries, its centralised position in Europe which made it particularly suited to fast and efficient distribution, and the fact that the Dutch printing industry was efficient and better equipped than most countries to handle quick production in foreign languages. Through its centralised location The Hague also provided the necessary close links with translators living in the countries of their own language, and this was considered essential for quality translations. (4) One officer, who received clerical assistance on an as required basis from the Australian Embassy in The Hague. (5) 1981-82 (a) 83 publications valued at $85 724, (b) 53 general printing items valued at $17 217. 1982-83 (a) 222 publications valued at $323 523, (b) 58 general printing items valued at $9 873. 1983-84 (a) 116 publications valued at $157 222, (b) 44 general printing items valued at $8 259. 1984-85 (a) 69 publications valued at $213 568, (b) 35 general printing items valued at $8 573. 1985-86 (a) 179 publications valued at $340 912, (b) 28 general printing items valued at $11 389. Separate figures on publications and general items procured through the office were not kept prior to 1981-82. The total number of items procured in 1980-81 was 156 and their total value was $365 736. (6) The information requested cannot be provided because appropriated funds and actual expenditure in each year from 1980-81 to 1985-86 for the office at The Hague were treated as part of the total funds appropriated to and spent by the Publishing Operations office of AGPS, and separate records for The Hague office were not maintained. However the following estimates of expenditure have been prepared: 1980-81, $29 470; 1981-82, $32 037; 1982-83, $47 176; 1983-84, $38 381; 1984-85, $41 340; 1985-86, $72 061. (Question No. 30) Mr MacKellar asked the Minister representing the Minister for Transport and Communications, upon notice, on 15 September 1987: (1) Was a survey conducted by Qantas in 1982 which showed that the average time for the last inward passenger to complete customs, immigration and quarantine checks at Sydney (Kingsford-Smith) Airport was 32 minutes. (2) Did the same survey show that the delay at Sydney was longer than at eight other overseas international airports included in the sample. (3) Has Qantas conducted similar surveys since 1982; if so, (a) on what dates were surveys conducted and (b) for each survey what was the average time for the last inward passenger to complete customs, immigration and quarantine checks at (i) Sydney, (ii) Singapore and (iii) Hong Kong. Mr Duncan —The Minister for Transport and Communications has provided the following answer to the honourable member's question: (1) Yes. (2) Qantas has advised that the survey covered three Australian international airports (Sydney, Melbourne and Perth) and five overseas international airports (Auckland, Honolulu, Hong Kong, Port Moresby and Singapore). Compared with the other seven airports in the survey, the inwards passenger processing time was found to be longest at Sydney. (3) No. The survey was conducted in 1982 by Qantas in conjunction with a review being undertaken at that time by the Government on a number of issues relating to the Customs Service. Since 1982, however, regular monitoring of processing of inwards passengers has been carried out by the Customs Service, and Qantas has not conducted separate surveys. (Question No. 80) Mr Hunt asked the Minister for Resources, upon notice, on 17 September 1987: (1) What research is being undertaken into Septoria Spot in Australian and US citrus fruit, and by whom and where is research being conducted. (2) How soon will this research be finalised. (3) What measures are now being taken to protect the Australian industry from the disease risk posed by imports of US citrus fruit, should it be found that the US strain of Septoria Spot is different to that in Australia. Mr Peter Morris —The answer to the honourable member's question is as follows: (1) Research is being done in Australia and the US to establish if the Australian and US isolates belong to the same or different species. This work is being undertaken by the Victorian Department of Agriculture and Rural Affairs and the University of California. (2) The work in Australia will be completed by next December while the work in US is expected to be finalised next year. (3) Citrus is prohibited from Florida because of citrus canker. However, there is no disease risk with imports from California or Arizona where canker does not exist. The Australian Quarantine and Inspection Service regards the Septoria in the US and Australia as belonging to one and the same species. This is based on earlier identifications in Australia and New Zealand. Current research in Victoria tends to confirm this. (Question No. 110) Mr Hollis asked the Minister for Land Transport and Infrastructure Support, upon notice, on 21 September 1987: (1) Further to the answer to question No. 1081 (Hansard, 26 May 1981, page 2599), which Department, authority, board, commission, trust or company controls each of the ports listed in the answer. (2) Have any other ports commenced trading since that answer was prepared. Mr Duncan —The answer to the honourable member's question is as follows: (1) The information sought in the honourable member's first question is given in the table below. Port Current Controlling Body NEW SOUTH WALES All N.S.W. Ports... Maritime Services Board of N.S.W. VICTORIA Melbourne... Port of Melbourne Authority Geelong... Port of Geelong Authority Portland... Port of Portland Authority Port Welshpool... Port of Melbourne Authority Westernport... Port of Melbourne Authority QUEENSLAND Brisbane... Port of Brisbane Authority Bowen... Harbours Corporation of Queensland, through the Department of Harbours and Marine Bundaberg... Bundaberg Port Authority Cairns... Cairns Port Authority Cape Flattery... Harbours Corporation of Queensland, through the Department of Harbours and Marine Gladstone... Gladstone Port Authority Hay Point... Harbours Corporation of Queensland, through the Department of Harbours and Marine Lucinda (Dungeness)... Harbours Corporation of Queensland, through the Department of Harbours and Marine Mackay... Mackay Port Authority Maryborough (Urangan)... Harbours Corporation of Queensland, through the Department of Harbours and Marine Mourilyan (Innisfail)... Harbours Corporation of Queensland, through the Department of Harbours and Marine Quintell Beach... Harbours Corporation of Queensland, through the Department of Harbours and Marine Rockhampton (Port Alma)... Rockhampton Port Authority Thursday Island... Harbours Corporation of Queensland, through the Department of Harbours and Marine Townsville... Townsville Port Authority Weipa... Harbours Corporation of Queensland, through the Department of Harbours and Marine SOUTH AUSTRALIA Port Adelaide... Department of Marine and Harbours American River... Department of Marine and Harbours Ardrossan... Broken Hill Proprietary Co Ltd Ballast Head... South Australian Gypsum, Division of CSR Limited Edithburgh... No longer in commercial operation Farquhar Jetty... No longer in commercial operation Kingscote... Department of Marine and Harbours Klein Point... Adelaide Brighton Cement Company Port Augusta... No longer in commercial operation Port Giles... Department of Marine and Harbours Port Lincoln... Department of Marine and Harbours Port Pirie... Department of Marine and Harbours Port Stanvac... Petroleum Refineries (Aust) Pty Ltd Proper Bay... Broken Hill Proprietary Co Ltd Rapid Bay... Adelaide Brighton Cement Company Stenhouse Bay... No longer in commercial operation Thevenard... Department of Marine and Harbours Wallaroo... Department of Marine and Harbours Wardang Island... No longer in commercial operation Whyalla... Broken Hill Proprietary Co Ltd WESTERN AUSTRALIA Fremantle (includes Kwinana)... Fremantle Port Authority Albany... Albany Port Authority Barrow Island... West Australian Petroleum Pty Ltd Broome... Department of Marine and Harbours Bunbury... Bunbury Port Authority Carnarvon... Department of Marine and Harbours Dampier... Pilbara Harbour Services Pty Ltd Derby... Department of Marine and Harbours Esperance... Esperance Port Authority Exmouth Gulf... Shire of Exmouth Geraldton... Geraldton Port Authority Port Hedland... Port Hedland Port Authority Port Walcott... Department of Marine and Harbours Wyndham... Department of Marine and Harbours Yampi Sound... BHP Minerals Pty Ltd TASMANIA Hobart... Marine Board of Hobart Burnie... Burnie Port Authority Devonport... Port of Devonport Authority Flinders Island... Marine Board of Flinders King Island... Marine Board of King Island Launceston... Port of Launceston Authority Port Latta... Marine Board of Circular Head Stanley... Marine Board of Circular Head Strahan... Marine Board of Hobart NORTHERN TERRITORY Darwin... Darwin Port Authority Gove... Nabalco Pty Ltd Groote Eylandt... Groote Eylandt Mining Company Pty Ltd (2) The following ports have commenced trading since Mr Hunt's answer of 26 May 1981: Port Controlling Body Abbott Point, Qld... Harbours Corporation of Queensland through the Department of Harbours and Marine Port Bonython, S.A.... Department of Marine and Harbours Cape Jervis, S.A.... Department of Marine and Harbours Penneshaw, S.A.... Department of Marine and Harbours (Question No. 182) Mr MacKellar asked the Minister for Land Transport and Infrastructure Support, upon notice, on 6 October 1987: (1) Has his attention been drawn to the disquiet amongst many Sydney residents over safety, environmental and privacy considerations raised by the operation over that city of the Bond airships. (2) Does the Commonwealth have the power to regulate aviation practices in Australia through the Air Navigation Act. (3) Do the International Civil Aviation Organisation's Standards and Recommended Procedures contain provisions to regulate the operation of airships. (4) Do the existing Australian Air Navigation Regulations make provision for the regulation of safety, operational and environmental aspects of airships. (5) What operational aspects of ballooning are presently controlled in Australia by Air Navigation Regulations or Air Navigation Orders. (6) If regulations do not presently exist for the safety, operational and environmental aspects of airship operations, will such regulations be implemented; if so, when will this occur. Mr Duncan —The answer to the honourable member's question is as follows: (1) Yes. (2) Yes. (3) Yes. The standards and recommended practices prescribed by the International Civil Aviation Organisation (ICAO) cover the operation of all aircraft. Airships are aircraft by definition in both the ICAO rules and the Air Navigation Act. (4) The existing Air Navigation Regulations make provision for the regulation of safety, and operational aspects of all categories of aircraft, including airships. With regard to environmental aspects the Air Navigation (Aircraft Noise) Regulations call up the application of ICAO Annex 16 requirements for the noise certification of aircraft. Currently the requirements specified in the Annex apply only to aeroplanes and helicopters. (5) Because the Air Navigation Regulations primarily specify rules for the operation of powered aircraft, exemptions have been granted against many of the provisions of the Regulations in order to facilitate the operation of balloons and other non-powered aircraft. The exemptions have been made under the authority provided by ANR 329a and the operational requirements and limitations for manned balloons are prescribed in Air Navigation Orders (ANO) 95.53 and 95.54. In addition, airworthiness requirements are specified in ANO 101.54 (certification) and 101.54 (maintenance), and Commercial Pilot Licence (Balloons) requirements are in ANO 40.7. (6) As indicated in the above answer to part 4, regulations do exist for the safe operation of airships. With regard to environmental aspects, the noise criteria specified for aeroplanes and helicopters are being used in determining acceptable operating heights for airships. (Question No. 205) Mr Cobb asked the Minister for Aboriginal Affairs, upon notice, on 6 October 1987: (1) What sum was provided by the Government for the purchase of the ``Penryn'' Aboriginal property near Peak Hill, NSW. (2) For what purposes and when have grants been provided to the property since its purchase. (3) What persons (a) employed on the property and (b) not employed on the property, including advisers, have received payments in respect of the property. (4) What sums have each of the persons referred to in part (3) received. (5) Is he able to say what sum the property has made or lost each year since its purchase. (6) Who has responsibility to run and make decisions relating to the property. Mr Hand —The Aboriginal Development Commission (ADC) has provided me with the following information in response to the honourable member's question: (1) The property was purchased by the former Aboriginal Land Fund Commission in 1979 for $172,635, with the title passing to the ADC on its inception in 1980. (2) Capital funding has provided stock, vehicles, soil conservation work and capital improvement such as fencing and shearing sheds. Recurrent funding has provided for operational deficits. Funding has been as follows: Capital Recurrent $ $ 1980-81... 128,619 23,381 1981-82... - - 1982-83... 43,000 30,000 1983-84... 65,100 - 1984-85... 33,000 62,400 1985-86... 61,850 30,452 1986-87... 37,178 26,138 1987-88 (proposed)... 76,000 43,003 (3) and (4). There is only one permanent employee, the Property Manager. He received $18,000 in 1986-87. Casual workers' wages have been paid by the Commonwealth Employment Service. Agricultural Consultants, Hassall and Associates, have been engaged to provide necessary technical advisory services, particularly supervision of extensive soil conservation. From the time of purchase in 1979 until 1984, costs of consultancy services were paid directly by the Warramunga Aboriginal Advancement Society. These services have been provided on special terms of reference negotiated jointly by the ADC and Warramunga. In the last three years the monitoring consultants have received the following sums: 1984-85-$4,462.00 1985-86-$4,052.00 1986-87-$4,868.00 1987-88-$3,193.00 (proposed) (5) The ADC has funded this organisation for its deficit since 1980-81. Operational losses for each year are: 1980-81-23,381 1981-82-Nil 1982-83-Nil 1983-84-30,000 1984-85-62,400 1985-86-30,452 1986-87-64,883 (6) The responsibility to run the property and to make decisions rests with the Property Manager under the direction of the Directors of the Warramunga Advancement Co-operative Society Ltd. (Question No. 223) Mr Price asked the Minister for Industrial Relations, upon notice, on 8 October 1987: (1) What are the occupational classifications whose salary is determined under the Remuneration Tribunals Act and which are not currently receiving the 11.7% 1982 Metal Trades flow on, thereby setting an example for the wider community. (2) What are the occupational classifications which are currently receiving the 11.7% 1982 Metal Trades flow on and hence are failing to set an example to the wider community. (3) Does the Government have any plans which will broaden the scope of example setting and enhance its effectiveness. Mr Willis —The answer to the honourable member's question is as follows: (1) and (2) The National Wage Case Principles provide scope for catch-up for the metal industry standard and adjustment of paid rates awards to establish an equitable base. In 1984 the Remuneration Tribunal in accordance with the National Wage Principles awarded an increase of 11.7% to judges, secretaries of departments and public office holders. Parliamentarians submitted that it would not be appropriate for themselves to receive an increase at that time and so no increase for Parliamentarians was determined. (3) The Government in its submissions to the Conciliation and Arbitration Commission in National Wage Cases, has stressed the importance of wage and salary restraint across the whole community. The National Wage Principles have been developed in the context of the need for restraint and the Government's concern is to ensure that any adjustments in wages, salaries and conditions of employment are consistent with these Principles. (Question No. 240) Mr Smith asked the Minister for Industrial Relations, upon notice, on 20 October 1987: (1) What has been the level of (a) Commonwealth funding to and (b) staffing at the Tasmanian Trade Union Research Centre in each year since 1983-84. (2) In relation to those years, (a) how many research papers have been published by the Centre and (b) what were the titles of each of the papers. (3) Does the Centre publish an annual report; if so, is the report presented to him. Mr Willis —The answer to the honourable member's question is as follows: (1) (a) I understand that the Trade Union Community Research Centre (TUCRC) is an independent research group which was established in order to provide a mechanism by which union and community input into economic planning in Tasmania can occur. The Centre is managed by a committee and is officially sponsored by the Electrical Trades Union of Australia, the Australian Workers' Union and the Printing and Kindred Industries Union. The TUCRC has been partially funded under my Department's Employee Participation/Industrial Democracy Cost Subsidisation Program. The TUCRC was awarded $50,000 under the Program in 1986 and a further $40,000 in 1987 to establish an employee participation/industrial democracy project. The aim of the project is to involve unionists, by way of seminars, meetings, information brochures etc., in developing proposals for new products and new approaches to work organisation and production in Tasmanian enterprises. The project covers the forest products industry, west coast mining and the Hydro-Electricity Commission. (b) I understand that the TUCRC employs two people who each work three days per week. (2) (a) and (b) The TUCRC is not required to prepare research reports, as such, under the Cost Subsidisation Program. However, the TUCRC, like all other Cost Subsidisation grant recipients, is required to provide my Department with quarterly reports on progress and expenditure with their project. To date, the TUCRC has complied with this requirement and provided satisfactory reports. The TUCRC is also required, as a condition of funding, to provide my Department with a comprehensive final report when the project concludes in July 1988. The final report will provide an evaluation of the project, lessons learned etc., and will be published by my Department. (3) The TUCRC does not publish an annual report and is not required to do so as a condition of funding. (Question No. 246) Mr Braithwaite asked the Minister representing the Minister for Transport and Communications, upon notice, on 20 October 1987: Is the Minister able to say whether Sir Peter Abeles, Ansett Airlines of Australia or TNT Air (Australia) Pty Ltd had any direct or indirect input into the tender process for the contract for coastwatch operations which was subsequently awarded to Amann Aviation; if so, what input did they have. Mr Duncan —The Minister for Transport and Communications has provided the following answer to the honourable member's question: Neither I nor my Department is aware of either Sir Peter Abeles, Ansett Airlines of Australia or TNT Air (Australia) Pty Ltd having either direct or indirect input into the tender process for the contract for coastwatch operations which was subsequently awarded to Amann Aviation. (Question No. 295) Mr Blunt asked the Minister for Community Services and Health, upon notice, on 21 October 1987: (1) When was it decided to have a study into rural housing. (2) Why was the decision made. (3) What sum will the study cost. (4) Where will it be conducted and why were those locations chosen. (5) Who will conduct the study. (6) What are its terms of reference. (7) Will the study consider the effects of the fringe benefits tax; if so, will the tax be changed or repealed. (8) If the study will not consider the effects of the fringe benefits tax, why not. Dr Blewett —The answer to the honourable member's question is as follows: (1) April 1986, as part of the Economic and Rural Policy Statement. (2) See (6) below. (3) $50,000. (4) Dubbo, Swan Hill and Bundaberg were selected by the Consultants for detailed study, on the basis of criteria established by the Consultants, relating to geographic spread, rural industry importance and different phases in the economic cycle. (5) Econsult (Australia) Pty Limited. (6) To examine ways in which existing housing programs could be varied to increase their effectiveness in rural areas. (7) No. (8) See (6) above. (Question No. 309) Mr Beale asked the Minister for Immigration, Local Government and Ethnic Affairs, upon notice, on 22 October 1987: (1) How many staff of his Department were employed for the collection of the international aviation departure tax. (2) What has happened to these employees now that the departure tax is no longer collected by his Department. (3) If these employees have been redeployed, how does this save the Government money. Mr Young —The answer to the honourable member's question is as follows: (1) In November 1985, the Office of the Public Service Board was notified that a potential redundancy situation existed in the Departure Tax function of my Department. The number of staff whose sole duties covered Departure Tax collection as at the date of notification was 24. (2) Those staff who worked on the collection of international aviation Departure Tax at the time of the transfer of that function to the then Department of Aviation and continued in employment in my Department were redeployed to other positions in the Department. (3) The then Department of Aviation assumed responsibility for administration of the Departure Tax legislation in so far as it applied to departures by air. That Department received no increase in staffing as the airlines assumed responsibility for collecting the tax from international air travellers. My Department's average staffing level was, however, reduced by twenty-seven (27) at an estimated saving to the Commonwealth of some $0.6 million in salaries in a full year. (Question No. 313) Mr Beale asked the Minister for Land Transport and Infrastructure Support, upon notice, on 22 October 1987: (1) Has the Commonwealth adopted the Marine and Ports Council of Australia's Uniform Shipping Laws Code; if not, is it likely to do so in the future and if it is not likely to do so, why not. (2) What does the Code entail. (3) If the Commonwealth has adopted the Code, do all departments abide by it. Mr Duncan —The answer to the honourable member's question is as follows: (1) and (2) The Uniform Shipping Laws Code has been developed to provide a basis for uniform regulation of ships and their crews. Where relevant, the standards incorporated in the Code are those which have been agreed internationally. The Code has no legal force of itself but is intended to be drawn upon in Commonwealth and State/Northern Territory legislation. Through the Navigation Act, and marine orders made pursuant thereto, the Commonwealth has adopted those provisions of the Code that apply to ships and crews under Commonwealth jurisdiction. (3) All Commonwealth departments involved in the operation of Commonwealth owned ships are aware of the Code and the Department of Transport and Communications, as the marine safety authority, endeavours to ensure that such ships, other than Defence Force ships, comply with the appropriate standards of the Code. (Question No. 355) Mr Blanchard asked the Minister for Veterans' Affairs, upon notice, on 2 November 1987: (1) How many Vietnam veterans have taken up the option of a Defence Service Homes loan. (2) What is the average amount of these loans. (3) What is the average period of the loans. Mr Humphreys —The answer to the honourable member's question is as follows: (1) Vietnam veterans are included in a statistical category* embracing all veterans who served in South Asian areas between 31 July 1962 and 11 January 1973 inclusive. Up to 30 September 1987, 30,417 loans have been advanced to this category. The majority of these loans have been made to Vietnam Veterans. (2) The average loan approved in relation to all applications received in the March quarter of 1986-87 was $24,042. (3) Loans are normally provided for 32 years. The majority of borrowers take the loan over this term. * This category covers persons who between 31 July 1962 and 11 January 1973 inclusive were on continuous full-time service outside Australia while the person or the person's unit was: allotted for duty in a prescribed operational area in South-East Asia (i.e. South Vietnam, Malaya, Singapore, Sarawak, Brunei, Sabah and certain surrounding waters); or deemed to have been allotted for duty in South Vietnam and its surrounding waters. (Question No. 96) Mr Hollis asked the Attorney-General, upon notice, on 18 September 1987: (1) Is he able to say whether the Directors-General of UNESCO and the World Intellectual Property Organization convened Committees of Governmental Experts on (a) Model Provisions for National Laws on Employed Authors in Geneva from 27 to 31 January 1986, (b) Audiovisual Works and Phonograms in Paris from 2 to 6 June 1986, (c) Works of Architecture in Geneva from 20 to 22 October 1986 and (d) Works of Visual Art in Paris from 16 to 19 December 1986. (2) Was Australia invited to attend the meetings. (3) Is he able to say which states, intergovernmental organisations and international non-governmental organisations participated in each meeting. Mr Lionel Bowen —The answer to the honourable member's question is as follows: (1) The Directors-General of UNESCO and the World Intellectual Property Organisation did convene Committees of Governmental Experts on the topics and dates specified. (2) The Australian Government was invited to be represented at each of the meetings. However, having regard to overall priorities concerning attendance at international meetings, it was not possible to send an Australian Government expert to these meetings. (3) The following is a list of states, intergovernmental organisations and international non-governmental organisations that participated at each meeting: (a) Committee of Governmental Experts on Model Provisions for National Laws on Employed Authors (Geneva, 27-31 January 1986)- (i) States Algeria, Bangladesh, Denmark, Finland, Federal Republic of Germany, Hungary, India, Italy, Japan, Luxembourg, Norway, Panama, Philippines, Portugal, Soviet Union, Spain, Sweden, Switzerland, Thailand, Tunisia, United Kingdom, United States of America. (ii) Intergovernmental Organisations Arab League Educational, Cultural and Scientific Organisation (ALECSO), Council of Europe (CE). (iii) International Non-Governmental Organisations European Broadcasting Union (EBU), International Association of Conference Interpreters (AIIC), International Bureau of Societies Administering the Rights of Mechanical Recording and Reproduction (BIEM), International Confederation of Societies of Authors and Composers (CISAC), International Federation of Film Producers Associations (FIAPF), International Group of Journalists (IFJ), International Group of Scientific, Technical and Medical Publishers (STM), International Literary and Artistic Association (ALAI), International Publishers Association (IPA), International Secretariat of Arts, Media and Entertainment Trade (ISETU). (b) Committee of Governmental Experts on Audiovisual Works and Phonograms (Paris, 2-6 June 1986) (i) States Angola, Argentina, Belgium, Brazil, Cameroon, Canada, Central African Republic, Costa Rica, Czechoslovakia, Ecuador, Finland, France, Federal Republic of Germany, Guinea, Holy See, Hungary, India, Italy, Japan, Jordan, Kuwait, Mexico, Nepal, Netherlands, Norway, Oman, Peru, Philippines, Poland, Portugal, Republic of Korea, Saudi Arabia, Senegal, Soviet Union, Spain, Sri Lanka, Sweden, Switzerland, Thailand, Turkey, United Kingdom, United States of America, Venezuela. (ii) Intergovernmental Organisations Commission of the European Communities (CEC) Arab League Educational, Cultural and Scientific Organisation (ALECSO). (iii) International Non-Government Organisations European Broadcasting Union (EBU), European Tape Industry Council (ETIC), International Alliance for Distribution by Cable (AID), International Association for the Advancement of Teaching and Research in Intellectual Property (ATRIP), International Association of Sound Archives (IASA), International Bureau of Societies Administering Recording and Mechanical Reproduction Rights (BIEM), International Catholic Organisation for the Cinema and Audiovisuals (OCIC), International Chamber of Commerce (ICC), International Confederation of Free Trade Unions (ICFTU), International Confederation of Societies of Authors and Composers (CISAC), International Copyright Society (INTERGU), International Federation of Actors (FIA), International Federation of Film Distributors Associations (FIAD), International Federation of Film Producers Associations (FIAPF), International Federation of Musicians (FIM), International Federation of Phonogram and Videogram Producers (IFPI), International Film and Television Council (IFTC), International Literary and Artistic Association (ALAI), International Music Council (IMC) International Publishers Association (IPA), International Secretariat for Arts, Mass Media and Entertainment Trade Unions (ISETU), Latin American Federation of Performers (LAFP). (c) Committee of Governmental Experts on Works of Architecture (Geneva, 20-22 October 1986). (i) States Algeria, Austria, Cameroon, Denmark, Finland, German Democratic Republic, Hungary, India, Italy, Japan, Lebanon, Madagascar, Netherlands, Peru, Spain, Sweden, Switzerland, United Kingdom, United Republic of Tanzania, United States of America. (ii) Intergovernmental Organisations International Labour Organisation (ILO). (iii) International Non-Governmental Organisations International Association for the Advancement of Teaching and Research in Intellectual Property (ATRIP), International Publishers Association (IPA), Max Planck Institute for Foreign and International Patent, Copyright and Competition Law, World Crafts Council (WCC). (d) Committee of Governmental Experts on Works of Visual Art (Paris, 16-19 December 1986). (iv) States Algeria, Bangladesh, Belgium, Brazil, Cameroon, Canada, Costa Rica, Cote d'Ivoire, Democratic Kampuchea, Denmark, Egypt, Finland, France, Federal Republic of Germany, Ghana, Guinea, Holy See, Hungary, India, Iran (Islamic Republic of), Italy, Jordan, Kuwait, Mali, Mexico, Morocco, Nepal, Nicaragua, Nigeria, Norway, Panama, Paraguay, Peru, Philippines, Saudi Arabia, Soviet Union, Spain, Sri Lanka, Sweden, Switzerland, Syria, Thailand, Tunisia, Turkey, United Kingdom, United States of America, Venezuela. (ii) Intergovernmental Organisations African Intellectual Property Organisation (OAPI), Agency for Cultural and Technical Co-operation (ACCT), Arab League Educational, Cultural and Scientific Organisation (ALECSO), Commission of the European Communities (CEC). (iii) International Non-Governmental Organisations Inter-African Union of Lawyers (UIAA), International Association of Art (IAA), International Catholic Organisation for the Cinema and Audiovisuals (OCIC), International Commission of Jurists (ICJ), International Confederation of Free Trade Unions (ICFTU), International Confederation of Professional and Intellectual Workers (CITI), International Confederation of Societies of Authors and Composers (CISAC), International Copyright Society (INTERGU), International Council of Archives (ICA), International Federation of Translators (FIT), International Literary and Artistic Association (ALAI), International Publishers Association (IPA), International Secretariat for Arts, Mass Media and Entertainment Trade Unions (ISETU), International Union of Architects (IUA), Law Association for Asia and the Western Pacific (LAWASIA), Max Planck Institute for Foreign and International Patent, Copyright and Competition Law, World Crafts Council (WCC). (Question No. 130) Mr Tickner asked the Minister for Defence, upon notice, on 24 September 1987: (1) Will he bring up-to-date the information supplied in his answer to question No. 2944 (Hansard, 13 February 1985, page 548), relating to coastal surveillance. Mr Beazley —The answer to the honourable member's question is as follows: (1) (a) The numbers of RAN patrol boat personnel involved in coastal surveillance were as follows: Year...Personnel 1985-86...330 1986-87...330 The number of RAAF personnel involved in coastal surveillance were as follows: ...Personnel Year...per week 1985-86...25 1986-87...25 (b), (c). No. No information additional to that previously provided is available. (2) Routine surveillance of the AFZ is spread evenly throughout the year. (3) (a) The proportion of RAAF flying time is as follows: Year % RAAF flying time % P3 Orion flying time 1985-86 ... 0.91 11.3 1986-87 ... 0.92 11.33 The proportion of RAN Flying time is as follows: Year...% RAN 1984-85...0.0 1985-86...0.0 1986-87...0.0 (b) The proportion of RAN steaming time is as follows: ...% RAN ...steaming Year...time 1985-86...33.3 1986-87...34.0 (4) (a), (b), (c) Responses remain as answered previously. (Question No. 133) Mr Simmons asked the Attorney-General, upon notice, on 24 September 1987: (1) Are letters from the Minister's Department forwarded to individuals and corporations marked `postage paid', without date stamping; if so, are there significant revenue savings from these measures. (2) If letters are not date stamped, will the Minister ensure all letters are appropriately date stamped. Mr Lionel Bowen —The answer to the honourable member's question is as follows: (1) Most mail dispatched by my Department is franked and therefore bears a date. Bulk postage (postage paid) services are used mainly for non-standard articles. Minimal savings accrue from the use of bulk postage services. (2) Date stamping of postage paid envelopes is a matter for Australia Post. (Question No. 150) Mr Lamb asked the Minister for Defence, upon notice, on 24 September 1987: (1) What is the cost per hour to fly one F/A-18 Hornet aircraft. (2) How many of the aircraft have been purchased by the Government. (3) What was the average cost of each of the aircraft. (4) How many of the aircraft are in operation. Mr Beazley —The answer to the honourable member's question is as follows: (1) $5,788 per hour. This represents RAAF's average operating costs for the aircraft (i.e. fuel, spares and contract servicing). (2) The Australian Government is purchasing 75 F/A-18 aircraft through the US foreign Military Sales System. The US Navy, acting on behalf of Australia, has placed firm orders for 52 of these aircraft and expects to place firm orders for the remaining 23 aircraft by end January 1988. To 28 October 1987 30 aircraft have been delivered to the RAAF with the remainder expected to be delivered at the average rate of 1.5 aircraft per month. (3) $A41m at April 1987 prices and exchange rates. (4) All 30 aircraft delivered to RAAF as at 28 October 1987 are in operation. (Question No. 397) Mr Downer asked the Minister for Social Security, upon notice, on 5 November 1987: (1) What was the total sum spent by the Minister's entire portfolio on public opinion polls in the period covered by the 1986-87 Budget. (2) What was the objective of each of the opinion polls and what did each cost. (3) Who was commissioned to undertake each opinion poll. (4) Are the results of each opinion poll publicly available. Mr Howe —The answer to the honourable member's question is as follows: (1) Nil (2) to (4) Not Applicable. (Question No. 402) Mr Blunt asked the Minister for Social Security, upon notice, on 5 November 1987: (1) When was the decision made to impose an assets test on unemployment benefits. (2) Was any consideration given to the effect this would have on farmers and their spouses; if not, why not. (3) If the effect on farmers and their spouses was considered, what conclusions were reached. (4) When was a decision made to introduce hardship provisions and a taper for the assets test. (5) Why was the decision made. (6) Why were the hardship provisions and taper not introduced when the assets test on unemployment benefits was first announced. (7) Were farming organisations consulted before the hardship provisions were drafted; if so, what was their contribution to the consultation. (8) If farming organisations were not consulted, why not. (9) Was the impact of the hardship provisions on the Rural Adjustment Scheme considered; if so, what conclusions were reached. (10) If the impact on the Rural Adjustment Scheme was not considered, why not. (11) Why will a statutory formula for deemed income under the hardship provisions be introduced. (12) Why was the factor of 2.5% chosen. (13) Was the actual income of farmers considered. (14) What sum will this action save. (15) How many pensioners will lose their pensions as a result of this interpretation of deemed income. (16) Have the manuals on the hardship provisions been completed; if so, when were they (a) completed and (b) distributed to regional offices. (17) If the manuals have not been completed and distributed, why not. Mr Howe —The answer to the honourable member's question is as follows: (1) to (13) The decision to introduce an assets test on unemployment, sickness and special benefit for persons aged 25 years or more was made in the context of preparation of the 1987-88 Budget. It has long been accepted that the details of Cabinet deliberations are confidential. (14) The introduction of the assets test to those forms of benefit is estimated to save $24.5m in a full year. (15) This information is not available. (16) and (17) Instructions for incorporation in the departmental manuals have been written. They will be distributed in the near future.