Wednesday, 13 April 1988 Madam SPEAKER (Hon. Joan Child) took the chair at 10 a.m., and read prayers. Madam SPEAKER —I inform the House of the absence of the Chairman of Committees, Mr Leo McLeay,who is on parliamentary business overseas. I have requested the honourable member for Banks, Mr Mountford, to carry out the duties of Chairman of Committees during Mr McLeay's absence. Madam SPEAKER —I inform the House that I have received a letter from His Excellency the Governor-General acknowledging the resolution agreed to by the House on 24 March 1988 relating to the arrangements for the opening of future sessions of Parliament. Mr Sinclair-Madam Speaker, I raise a point of order. Can you explain the nature of that communication? Is the Governor-General accepting advice from this House without it having been approved by the Senate? If I may perhaps extend my remarks, my understanding was that that resolution had been forwarded to the Senate. Until such stage that it has been accepted by the Senate, it has not actually been accepted by the Parliament. I would therefore ask on what basis has advice from one House been forwarded to the representative of the Queen, instead of advice from the Parliament as would normally be the case? Madam SPEAKER —The letter from the Governor-General just thanks the House for the letter of 24 March conveying the text of a resolution agreed to by the House of Representatives about arrangements for the opening of future sessions of Parliament. It is simply an acknowledgment of the fact that it was sent from this House to the Governor-General. It also has to go through the Senate. Mr Sinclair-Madam Speaker, with indulgence: my understanding is that the Parliament, not this House, advises the Governor-General. You will recall that there was a specific addition to the resolution requesting that the resolution be sent to the other chamber. It would seem extraordinary to me that the advice should be forwarded-and I accept that it has been-from just one House. I point out that, in normal circumstances, advice to the Governor-General should be advice from the Parliament. As you know so well, normally a resolution would go from this place to the other place, we would get advice back from the other place and we would then proceed to advise the Governor-General. I suggest that in this instance protocol has been breached. I think the Governor-General might well be alerted to that. Mr Beazley-Madam Speaker, with your indulgence, on the point of order, I would suspect that this is a somewhat different resolution from that which would normally proceed in the way which has been suggested. It is about the opening arrangements for the Houses of Parliament on which both Houses may have different but equally valid views. We obviously have a requirement to consult the Senate on that matter, but not exclusively the Senate. I do not think there would be anything inappropriate in the Speaker or the Clerk-the Speaker in this case-writing to the Governor-General and informing him of the House's views. Madam SPEAKER —It was our view that we should request the Senate to pass the same motion. But I do not think that precludes this House from taking its own action. Bill returned from the Senate without amendment. Assent to the following Bills reported: Conservation Legislation Amendment Bill 1988 Family Court of Australia (Additional Jurisdiction and Exercise of Powers) Bill 1987 Parliamentary Precincts Bill 1988 Debate resumed from 23 March, on motion by Mr Howe: That the Bill be now read a second time. upon which Mr Connolly had moved by way of amendment: That all words after `That' be omitted with a view to substituting the following words: `whilst not declining to give the Bill a second reading, the House deplores the fact that the economic and social policies pursued by the Hawke Government since March 1983 have directly contributed to the continuing high level of marriage break-ups by: (1) increasing the number of Australian families living below the poverty line and bearing the brunt of unemployment, including an additional 165 000 children; (2) pursuing policies which have resulted in single income families on average weekly earnings with 2 children facing a decline of $42 a week in their standard of living in real terms; (3) abolishing negative gearing between July 1985 and September 1987 which resulted in a decline in rental accommodation, and a steep rise in rental costs which has contributed to 160 000 Australians waiting for public housing, while thousands of families and individuals live in refuges, emergency accommodation or on the streets; (4) failing to give recognition to the increased burdens of families with dependants other than the approximately 23% eligible for assistance under the Family Assistance Scheme; and (5) contributing to a marked decline in the standard of living of veterans, war widows, ex-service personnel and serving personnel'. Mr SNOWDON(Northern Territory)(10.05) —I rise in support of the Social Security and Veterans' Entitlements (Maintenance Income Test) Amendment Bill and to oppose the amendment moved by the honourable member for Bradfield (Mr Connolly). I remind the House that the Bill is complementary to the Child Support Act 1988. Together, they constitute the major elements of the child support scheme, which is one of this Government's most significant social policy reforms. The Social Security and Veterans' Entitlements (Maintenance Income Test) Amendment Bill will effect reform in the manner in which maintenance, which is ordered under the Family Law Act and coordinated under the Child Support Act, is treated by the social security and veterans' benefits systems. This legislation is an essential part of the Government's program to enter the 1990s with guaranteed financial security for over 400,000 Australian children living in poverty as a result of the trauma associated with marriage breakdown. Although many Australian parents assume responsibilities for child support subsequent to marriage breakdown, Australia is entering the 1990s with a trend in which only 30 per cent of non-custodial parents pay regular maintenance for their children. The fact that 70 per cent of non-custodial parents do not pay maintenance is a tragedy which this Government seeks to redress under the new child support scheme of which this Bill is an integral component. The Government recognises that the shirking of parental responsibility for non-custodial child support and the existence of child poverty are largely the result of deficiencies in the existing child maintenance system. Legislation must be enacted to ensure that the Australian taxpayer is not required to bear the economic burden of inadequate levels of court orders, ineffective coverage of the eligible population, difficulties in the enforcement of court orders and a lack of integration of the child maintenance system with the social security system as a whole. The Social Security and Veterans' Entitlements (Maintenance Income Test) Amendment Bill provides a mechanism by which maintenance payable by non-custodial parents under the Child Support Act will be coordinated with public support entitlements and family allowance payments for distribution to beneficiaries through the Department of Social Security. Upon the introduction of this Bill, the following maintenance reforms will be implemented: capital or lump sum maintenance as specified in orders or agreements made after the start of the scheme will be imputed as income of pensioners and beneficiaries; in-kind maintenance and payments made to third parties in lieu of maintenance will also be imputed; a separate maintenance income test will be introduced; there will be special treatment of maintenance by way of housing provision; and special savings provisions will preserve the pre-scheme total income of existing pensioners and beneficiaries who are custodial parents. The introduction of this Bill, in association with the Child Support Act and amendments to the Family Law Act, will have particular application in the Northern Territory. Statistics reveal that in the Northern Territory 11.5 per cent of families are single parent families with one or more dependent children, compared with the national average of 7.9 per cent. Those figures, and the transient nature of the Northern Territory, lead one to deduce that single parent families seek refuge in the Northern Territory and that community and family support services in my electorate are called on to alleviate the burdens of maintenance evasion in the southern cities and States. This Bill will do much to alleviate the economic need of single parents to abandon their established home environment in other States and will minimise the distance factor in the pursuance of maintenance payments. It should be recognised that what this Government will be able to achieve through this and the complementary legislation to which I have referred is to encourage a significant shift in community and legal values in the settlement of maintenance orders and the responsibilities of non-custodial parents towards their children. Criticisms have been levelled against aspects of the legislation, which seeks only to ensure that non-custodial parents assume their responsibilities under the new child support scheme. Those criticisms reveal a disgusting attitude, in my view, which condones child deprivation which is all too apparent under the existing maintenance system. The Government is facing up to its responsibilities to the children of this nation. While I note that the Opposition supports the Bill, through amendments moved by the honourable member for Bradfield it has made a number of assertions in relation to the objectives of this Government in the area of social reform. I point out that the performance of this Government in the area is in stark contrast to the record of the Opposition and the baseless assertions of the honourable member for Bradfield. The facts are that under the previous Government the real disposable incomes of low income families declined by 5.5 per cent for a beneficiary couple with four children and by 4.2 per cent for a sole parent pensioner with two children. As a result, the number of children in poverty more than doubled under the previous Government. Mr Rocher —That is not what Gerry Hand says. Mr SNOWDON —I will repeat that for the benefit of the honourable member opposite. The number of children in poverty more than doubled under the previous Government. The fatuous claims made by the Opposition in this area need to be revealed for what they are. At the same time, the additional pensioner benefit for children fell by about 32 per cent in real terms between 1975-76 and when this Government first came to power in 1983. That is the record of the Opposition when it was the Government of this country. The value of this payment has now increased by about 59 per cent in real terms since this Government came to power, or by 102 per cent for children aged 13, 14 or 15. That is this Government's record and it contrasts with the ridiculous claims made by the Opposition and with its record in government. While the Government has concentrated on improving assistance for low income families, other families have benefited from the three rounds of income tax cuts made since March 1983. For example, a single taxpayer with no dependants and earning $200 a week will have gone from paying $34 a week in March 1983 to $25 a week in July 1987. A taxpayer earning $400 a week will have gone from paying $98 a week to $83 a week. Since coming to office this Government has created more than one million jobs at more than twice the rate of the Western industrialised world and at four times the rate of the Fraser-Howard Government. So much for the claims of the honourable member for Bradfield and the Opposition. This Government, unlike the previous Government when Mr Howard was Treasurer, has thus far brought down unemployment to 7.4 per cent-and we are expecting further falls. This Government has introduced a family package of tax free cash assistance which directs $22 per week per child, and more for teenagers between the ages of 13 and 15, to almost 600,000 working families with 1.2 million children. This new family package has been introduced at a cost of some $500m a year. For a family earning $320 a week, with three children, the new tax free payment of $66 a week is equivalent to a wage rise of $93 a week. This Government has brought inflation and interest rates under control. We are well on the way to getting inflation down to 6 per cent by mid-year and mortgage rates are now 2 per cent lower than they were at this time last year. We have raised the age pension by 8.4 per cent in real terms, in contrast to the sorry record of the Opposition when it was in government. Mr Tuckey —That is not so. Mr SNOWDON —When Mr Howard was Treasurer, as unpalatable as it may be to the honourable member for O'Connor, the real value of the pension was cut by 4.1 per cent. Those opposite bleat and bleat about this Government's record. The public knows what the Opposition's record is. The public knows about the hideous performance of the Opposition while in government, when it had control of the treasury bench. Under this Government the pension has now virtually reached the important Australian Labor Party target of 25 per cent of average weekly earnings. Those opposite could not come close to that figure. Age pensions are indexed twice a year, at a cost of $1 billion. This Government has addressed the poverty trap problem by allowing pensioners to earn more income without their pensions being reduced. This Government has introduced the home and community care program to improve the choices available to elderly Australians in need of care and doubled the funds available for care of the aged and disabled in their homes. This Government has assisted 270,000 young families through our first home owners scheme. I ask honourable members to contrast that record with the politics of hatred that marks the Opposition. The Opposition is concerned with setting Australian against Australian. The Opposition would abolish the assets test so that millionaires could get the pension. The Opposition would pay for the pensions of millionaires by cutting pensions for all sole parents whose children are over the age of 10 years. That was the promise of the Opposition parties at the last election. At the last election the Opposition talked about funding cuts that targeted child care centres and labour market programs and public housing. That is the concern of the Opposition for the public and social security of this nation. Who can forget John Howard cloistered with his rich mates in the Melbourne Club, caucusing with John Elliott and coming up with the consumption tax? The honourable member for O'Connor knows all about the consumption tax. He did not want it but now he has to wear it. We all know what the impact of a consumption tax would be on the poor in Australia. I will quote what the honourable member for Bradfield has said in this regard. He is the person who has been trying to shoot down this Government's policies with regard to social security and social justice. It was a pitiful attempt during his contribution to this debate in moving the Opposition's amendments. The honourable member for Bradfield said of consumption tax: Two things come into place. Firstly, those who do pay income tax would pay less income tax but the quantum of tax may not change very much. The second element is that those who pay little or no income tax must be thoroughly protected otherwise they will be the ones who will have to carry most of the cost, and obviously that is not satisfactory. I shall repeat that last sentence: The second element is that those who pay little or no income tax must be thoroughly protected otherwise they will be the ones who will have to carry most of the cost, and obviously that is not satisfactory. Indeed, it is not satisfactory. What is the Opposition proposing in the area of consumption tax? Let us look at the electorate that I represent-the Northern Territory. The unemployment rate in the Northern Territory is some 12 per cent, the highest in Australia. The honourable member for Bradfield knows what it is like in the isolated communities of the Northern Territory. The honourable member is not present at the moment but he would recall visiting outlying Aboriginal communities where the total population is dependent upon social welfare payments. He will recall the cost of living in those areas. As I recall, he made statements about the shop at Kintore. He said he was concerned about the exorbitant prices charged in that shop, which the Aboriginal people at Kintore had to pay for goods and services. The honourable member for Bradfield would recognise, as other honourable members do, that the cost of living in the Northern Territory's capital city, Darwin, and to a lesser extent Alice Springs, is the highest of any major city in Australia. The honourable member should understand, therefore, that the cost of living in remote communities is even higher. It is people living in these areas who would have to bear the burden of the Opposition's consumption tax. What would the Opposition do to help them? What would the Opposition do to alleviate the problems that confront Aboriginal people living in remote communities? What would the Opposition do to assist those who live in the northern suburbs of Darwin who have the backsides out of their pants? What would the Opposition do to assist these people? It has no intention of doing anything. We now know from where the Opposition intended to raise its $2.5 billion, which is the gap between what it promised during the campaign for the last Federal election and what it said it would raise in tax revenue. It was going to raise that amount from a consumption tax. It had absolutely no intention of doing anything for those who live in poverty in Australia. The Opposition's record speaks for itself. When the Opposition was in government it undermined the social security system of this country. It increased the deprivation of those who live in poverty in this country. When the Opposition went to the polls last year, it promised to deprive such people even more, yet its members stand in this House and say that they wish to introduce a consumption tax. Last year, in July, in the lead-up to the election the Opposition promised to undermine the incomes of those people who comprise the poorest sections of the community. This consumption tax would redistribute income away from the poor and direct it to the rich once again. The Opposition's record speaks for itself. There is nothing it can say that will convince the Australian community otherwise. We all know that the National Party of Australia understands the realities of remote Australia. We all know what Senator Stone said in another place and elsewhere throughout the country. On 3 December 1987, Senator John Stone is reported in the Sydney Morning Herald as saying: It- a broad-based consumption tax- hasn't a ghost of a chance-it is bad economics and bad politics. He understands that it is bad politics; he understands that it is bad economics, as antediluvian as some of his economic theories may be. He understands that it is the people living in remote areas of Australia who would suffer. To their credit, the members of the National Party understand. But, they sit silent on that side of the House because they form part of the coalition. The honourable member for Kooyong (Mr Peacock) said: It is not a National Party tax policy these days, or a Liberal Party tax policy, it is a Coalition tax policy. I ask members of the National Party to tell us whom they represent. Do they represent those people in the remote areas of Australia who bear the higher cost of living in the country, or do they represent the interests of those people on the front bench of the Liberal Party who come from the North Shore of Sydney and the south side of the Yarra? That is what I would like to know. I have a fairly good idea of whom they represent. Mr Howe —They are a long way from the bush. Mr SNOWDON —They certainly are; they have no concern for those people. The honourable member for O'Connor is from a bush electorate. He understands the problems of a consumption tax but he will have to wear it because his Party has decided that it wants a consumption tax. What will he tell his electors? He will say, `I'm sorry, pals, you'll just have to wear it. Don't worry about it; we'll undermine the social security system. We'll impose a consumption tax, but you'll be sweet because we'll be the Government'. Let me tell the honourable member for O'Connor that the shadow Minister for finance has got it right. It is bad politics, it is bad economics, and if that is the coalition's policy it will never get into government-thankfully. I conclude by pointing to this Government's record in the area of social justice. I refer to the social wage, something which the Opposition does not understand and has great difficulty coming to terms with. The Economic Planning Advisory Council report of April 1987 analysed trends in social wage expenditure and its distributional impact. For the benefit of those opposite, the report states: The social wage is defined to include outlays on health, education, social security and welfare, and housing and community amenities. Real per capita expenditure on the social wage (total public sector) increased 6.5 per cent between 1982-83 and 1984-85. How does this compare with the deplorable record of those opposite when they were in government? It compares with an increase of 1.6 per cent a year between 1978-79 and 1982-83 and a decline of 2.3 per cent a year between 1975-76 and 1978-79. So much for the bleatings from the honourable member for Bradfield. He has no idea what social justice means. The Opposition has no comprehension of what are the needs of the poorer sections of our community. It has no intention of living up to its responsibilities if ever it is in government-God forbid that that will ever happen-and looking after those with the most need in our community. It has no concern for the people in my electorate, that is for sure, who would suffer horrendously if a consumption tax were introduced. If we imposed a 10 per cent consumption tax, what would happen, for example, to the standard of living of those people whom the honourable member for Bradfield said he is concerned about? As I said, the Opposition had no intention of increasing pensions had it come to power. What would happen? If it did not increase pensions, it would have no way of compensating those people who are the most deprived in our community. What would happen to those people who live in Kintore if there were a 10 per cent increase on food and other items as a result of a consumption tax? They would go out the door. The health and community standards of the Aboriginal people in rural areas of the Northern Territory, which were of concern to the honourable member for Bradfield, would decline even further. We would see a shameless attack on the standard of living and the health care of those people who live in remote communities. Not only would those people suffer from this hideous consumption tax proposal, but those people in Australia who are on low incomes, those who rely on the social security system for support, would also suffer. These are the people that the Opposition is attacking by its proposal to introduce a consumption tax. Let us face it: while the honourable member for O'Connor may disagree with the approach of his colleagues on the other side of the House, he knows that he has to fall into line behind the new leader of the Liberal Party, Mr Elliott. He knows that he has to fall in line because Mr Elliott and his cowboys who live in the Melbourne Club want to ensure that their ilk get the benefits of government, that they are able to distribute income towards themselves and away from the poorer sections of the community. Instead of supporting those most in need, he and Mr Howard want to get together and gang up on the honourable member for O'Connor, the shadow Minister for finance and those people who have rural electorates, and get the goodies for themselves. It is a shameful attack on the people of Australia. It is a shame that the honourable member for O'Connor has to sit at the table and accept the nonsense that is fed to him by the front bench of his Party. I suggest that, before the honourable member for Bradfield bleats in the way he did when he moved the amendments to this legislation, he should look at the record of his Party when it was in government. He ought to look at the promises it made to the electorate in July of last year and see what their impact would have been. He has no idea of what social justice means and neither has the Opposition. Madam SPEAKER —I remind the honourable member for the Northern Territory that in future debates he should refer to the Leader of the Opposition as the Leader of the Opposition. Mr ROCHER(Curtin)(10.25) —From the outset, and in stating my support for the amendment moved by the honourable member for Bradfield (Mr Connolly), I should reiterate what previous speakers on this side have indicated: that the Opposition supports the general aims of this Bill and the package of legislation of which it is an integral part. Anyone who was listening to the remarks of the honourable member for the Northern Territory (Mr Snowdon) might be surprised to learn that. It seems that he had so little to say in support of the legislation that he spent his time attacking, in a disjointed, animated and somewhat inaccurate way, the supposed position of the Opposition parties. I guess that is a measure of his understanding of the legislation. It is certainly an indication of his appreciation of Opposition party policy. I remind the honourable member that the electors of Groom only a week ago had something to say about the relative importance of a consumption tax, particularly as it was not part of Opposition policy. The Labor Party candidate ran that line pretty hard. We will see the signs of this happening over the next several months. Members on the Government side will be getting up and attacking the Liberal Party or the coalition parties about a consumption tax that is not part of our policy. We saw them do so on the issue of privatisation some time ago. They attacked us left, right and centre, and made it an issue in the general election in South Australia. Not long afterwards, when it suited their purposes, they adopted the Opposition parties' privatisation policy and concepts. The honourable member for the Northern Territory, to pick out one amusing little example, told us about the tax which was payable before the change of government in 1983 by an income earner on $200 per week. He said-and I have no reason to doubt him, although I have not checked it-that it stood at $35 in those days, whereas now it has been reduced to perhaps $29 or some such figure. The tax certainly has reduced on an income of $200. What the honourable member failed to mention is that under this Government's high inflation policies a salary of $200 is probably now worth $250, before tax, in the income earner's pocket, and that he is paying $50-odd tax on it. One can forget the relevance of an income of $200 five years ago; it is what the income earner has to pay in tax now that is relevant. That is the deception that is being practised on Australian taxpayers, because tax collections are up. They are up because of bracket creep, and it is a deliberate policy. So much for the honourable member for the Northern Territory. He did not say a great deal more on which I would care to comment. Broadly, it is a valued principle that people should accept the financial costs of their own decisions to bring up children. Government should never have a leading role in influencing those decisions, even when marriage breakdown and ensuing separation and maintenance are not an issue. Clearly, it is preferable for separated parents to be able to provide for all children of their union, without the intervention of government. In that preferred circumstance, not only would the children be better off, but the parents could preserve their independence and integrity, which no government should deprive them of unless for good and proper cause. That being said, I fear some differences between the Government and Opposition emerge. One cannot help thinking that, given the track record of the Government, the motivation for this legislation is not so much to reinforce individual responsibility, but is more to improve the budgetary outlook and the budgetary problems that the Government has created for itself. In other words, it seems likely that money rather than the well-being of children is the prime motivator. This perspective is reinforced by the apparently inflated estimates of savings which are indicated in the financial impact statement. Given the number of people involved, the savings of $120m in 1988-89 and $192.8m in 1989-90 seem to be very high. Perhaps the Minister for Social Security (Mr Howe) could tell us why savings are predicted to grow so rapidly in years subsequent to 1988-89. It seems likely that inflation will account for the gradual end to transitional provisions which provide a floor in incomes at the level which exists prior to the adoption of this legislation. Surely inflation will not account for the huge growth in savings in subsequent years as indicated in the financial impact statement. As if to add fuel to the fire of my concern, the Government has made it clear that this legislation is a Budget Bill. While we cannot be certain that it will be so, the estimates provided to this House must be based on the best assessment of available information and not on the most favourable figures for the Budget or Budget projections. In the past the existence of the social security system has very much acted as a disincentive for people to provide child support through maintenance. That is because it would have been literally impossible for many well-meaning parents to provide the same level of support as social security and other pension benefits. It was a terrible irony that a guise of irresponsibility might be required of parents to ensure that the Government looked after their children. In the House several weeks ago the Leader of the Opposition (Mr Howard) cogently demonstrated the dreadful effects of poverty traps on the welfare of Australian families. In particular, he referred to the hastily brought together family income supplement. That measure was simply one of the most notable attempts of the Government to buy votes at the most recent general election. The timely demise of Labor in New South Wales after a similar exercise in political cynicism suggests that the Government created that particular poverty trap for little political benefit. That view is more and more reinforced by recent by-election results around the country. The fact remains that most Australians do not want a burgeoning welfare system and all the problems for individuals and families that go with it. It is trite to say it, but the solution to poverty is prosperity. At the same time it must be recognised that people value their independence, often to the extent that they would prefer to refuse money from the Government. That is still the case, I am glad to say, although much less so than in years past. Nevertheless, a virtue of this Bill is that it would avoid the ever present risk of poverty traps. It allows some continued incentive for a recipient of a pension or benefit to seek increased income through maintenance. This additional income from private rather than from public moneys will offer savings to the Government as well as benefits to the parents supporting a child or children. The down side is that each dollar of additional maintenance income will reduce the payment of social security and related benefits by 50c. That will apply once the permissible earnings of $15 per week plus $5 per additional child are exceeded. These provisions are worthy attempts to deal with the problem of poverty traps which might make the receipt of maintenance from a former spouse undesirable. Parts of the Bill consider maintenance income separately from income derived from work or other sources with a similar objective. The other side of poverty traps, which provide a definite disincentive for people to gain any sort of income beyond that provided by the social security system, is the desirability of work as well as of income producing investments. That presents a dual problem that this Government has really created for itself in any attempt it might make to reform the social security system and tackle the acknowledged problems of poverty. On the one hand there is the risk of making dependence on the Government so attractive that people seek rather than avoid such dependence; on the other hand, the Government pays for that social security system through taxation. High marginal rates of confiscatory taxation make the work option look less attractive. As well, the capital gains tax is into the attempt to make money by other entrepreneurial means. It is because of this conundrum that any attempt to eliminate poverty through the social security system is likely to fail. In a very real sense, there is a danger that success in giving comfortable public provision will lead to the creation and extension of more poverty. These issues are examined by Charles Murray in his important work entitled Losing Ground. The conclusions of these and his arguments are equally applicable to legislation which we now have before the House. Ultimately, the aims of the child support scheme will not be achieved just by this legislation. The support of children depends on wider factors, such as the economic prosperity of the country and the desirability of raising a family in the existing environment. Maintenance entitlements covered in this legislation are triggered only when marriages break down. This will happen for many reasons, and it is not the job of members of this Parliament to preach to people about probable causes. In the context of this debate, however, what we can do is ensure that we do not pass legislation which will unduly disadvantage those people who choose to marry and have children. That brings me to the point that fundamental to the living standards of families in Australia is economic policy. Contrary to the rhetoric of honourable members opposite, economic policy is one of the great areas of failure of the Hawke-Keating Government. The Government's policies have maintained a level of inflation at least treble that of our major trading partners for most of its term of office. This high inflation policy is particularly felt by those doing the weekly shopping and seeing their disposable income dwindle. Anyone contemplating the rapidly receding chance of buying a new car on the sort of income most people now receive is feeling the pinch of government policies. People considering an overseas holiday for themselves or their families can see, in the rapidly expanding prices, the effects of this Government's policies. Anyone trying to earn a bit more money in a second job or by improving the capital value of his property can see the effect of this Government's policies as high marginal rates of income tax and capital gains tax confiscate more of the results of his work. All of these consequences of this Labor Government affect the well-being of individuals and families. They have had and will have a detrimental effect on the happiness and well-being of many Australians. The family holiday, which gives people a real chance to relax and get away from it all, has become an increasingly burdensome drain on the pockets of Australian wage earners and small business owners. No-one should pretend that general economic conditions are not the biggest influence on the social security system and that those economic circumstances do not affect the conditions in which children live. It follows that the payment of maintenance is best facilitated by the person paying for the support of the children having the adequate means of doing so. The savings provided for in this Bill can be made only if the person who will pay maintenance is not unemployed or dependent in some other way on the social security system. Honourable members opposite will, I hope, acknowledge that, despite the bluster of the Treasurer (Mr Keating), Australia still has an unacceptably high rate of unemployment. Five years of Labor Government have made little impact on the seemingly intractable problem of unemployment. The Government talks a lot about its mastery of macro-economic policy. Having to get the macro-economic variables in order is the Trea-surer's excuse for every economic failure he has foisted upon this country. Furthermore, it is the Government's excuse for the present problems of Australian industry. However, this talk of macro-economics demonstrates an appalling lack of regard for micro-economics. The Government likes to ignore the details of economic argument because they are so unpalatable. That is a great threat to the good intentions of this Bill, which sets up a structure that is, in many respects, better than that system it will replace. All of this will come to nothing if people do not have the means to pay maintenance. A significant part of the Bill will involve the assessment of maintenance of income in kind. This is clearly a necessary measure to avoid people circumventing the intentions of the Bill. However, the Government should keep it in mind that this will lead to the most difficult administrative task in implementing the principles of the Bill. The judgment of the value in kind contributions to the support of children will not always be straightforward-I doubt that it will ever be straightforward. Therefore, it will be a difficult task for staff of the Department of Social Security and a source of frustration for some beneficiaries. I acknowledge that these are probably unavoidable difficulties, and I can only urge the Minister for Social Security and his Department to be mindful of them. This points to an element of the current package of child support legislation which is more important to the Opposition than it seems to be to the Government. In drafting its child support scheme, the Government has committed considerable resources in staff and money to its implementation. We will have an essentially bureaucratic system of maintenance payments which does not make provision for private individuals to accept their responsibility through private arrangements. Whilst the well-being of children must be the first priority of maintenance, this must be done, in my opinion, as efficiently as possible with minimal intervention by government when it is not necessary to a solution. I remind the Government that the child support scheme will stand or fall on the economic performance of Australia during the remainder of this Government's term in office. The best option of child support is actively to foster the family as the building block of our society. In the absence of disincentives, the family unit used to be able to meet most of its own welfare needs. Sadly, this ability has been reduced over the past 20 or 30 years for a number of reasons which would take too long to canvass here today. I would like to conclude with the worthwhile remarks of my former colleague John Hyde in an article published last year in the Weekend Australian. He said: In addition, the State threatens the viability of the family itself, partly through marital legislation and partly through tax and welfare features that make family life an unattractive proposition or that encourage people not to meet their familial responsibilities. We run the risk, in our well-intended legislative efforts, of going further down the road that Hyde warned us about. Whilst I do not have any easy answers, I do think that the problems are not being adequately thought through on all occasions. We deal with one problem at a time far too often, and although I would not ascribe that failing to the Minister necessarily it seems to be a failing of his government generally. Mr JENKINS(Scullin)(10.44) —It is my pleasure to rise in this debate to support the Social Security and Veterans' Entitlements (Maintenance Income Test) Amendment Bill. This Bill is the third and final part of the legislative package to implement the Government's thorough review of the child support scheme. There are another two pieces of legislation-the Family Law Amendment Act 1987, which provides for assessment of child support in the court system, and the Child Support Bill 1988, which provides for the collection of child support. The need for this important reform arises from the recognition of two important facts: first, over half of the 800,000 Australian children living in poverty are in single parent families; and, secondly, more than 70 per cent of non-custodial parents do not pay regular maintenance for their children. Clearly, children are the main casualties of marriage breakdown. Research done by the social policy and research department of the Brotherhood of St Lawrence, and by the Government through the social security review, has highlighted this alarming situation. In 1981-82 the incidence of poverty was higher for the children of sole parent households and for single parents themselves than for any other household type; 46 per cent of all sole parent households were below the poverty line; 70 per cent of sole parent households with three children were below the poverty line; and 91 per cent of sole parent families with four or more children were in poverty. Between 1972-73 and 1981-82 the incidence of poverty in female headed single parent families increased from 38 per cent to 50 per cent and for male headed families from 16 per cent to 19 per cent. Between 1976-77 and 1985-86 the real disposable income of a sole parent pensioner with two children dropped by 2 per cent, and of a sole parent pensioner with four children by 5.6 per cent. Clearly, several factors contributed to this situation. First, the participation in the labour force by single parents dropped from 45 per cent in 1974 to 40 per cent in 1984. Secondly, there was a decline in the real value of the non-indexed components of government income support. For example, as Bettina Cass has shown, the real value of the family allowance declined by 29 per cent between 1976-77 and 1985-86. Thirdly, there was a failure by non-custodial parents to meet their financial responsibility with regard to their children. The Government's commitment to ensuring that measures are taken so that no children need live in poverty demands that the child support system be reformed. Parents who have the capacity to pay will no longer be able to abdicate their responsibility to provide financial support for their children-a responsibility that until now has fallen to the social security system. As the Minister for Social Security (Mr Howe) has said, the scheme will make the legal right of children to be supported by both their parents a real right. It was disappointing to hear the honour-able member for Curtin (Mr Rocher) imply that the motivations for this package were merely budgetary. I think the underlying principle in this package deserves bipartisan support. The Government's reformed child support scheme will, first, increase the number of families receiving maintenance; secondly, it will increase the level of maintenance; thirdly, and importantly, it will ensure that the maintenance is received on a regular basis. Effective maintenance collection has never been achieved in Australia-a statement confirmed by the estimate that 70 per cent of non-custodial parents do not pay regular maintenance. The establishment of a child support register which records all maintenance liabilities and effects automatic deductions from wages and salaries is the only way to ensure that children receive the support to which they are entitled. This is a collection system that does not depend on voluntary payment. There has been some suggestion that automatic withholding should be imposed only when default in payment occurs. After careful consi-deration, the Government has rejected the suggestion. As the Minister has previously pointed out, the experience overseas is that in a vast majority of cases, default occurs within the first two years after an order for payment is made. If we are considering any stigma that attaches to automatic withholding, surely such stigma is greater if this requirement is applied only after default. The incidence of marriage breakdown and single parent families is on the rise in this country. In the mid-1970s sole parent households constituted 9 per cent of all families whereas they constituted 14 per cent in 1984. The Government has an obligation to ensure that adequate maintenance is paid regularly by non-custodial parents with a capacity to pay. The Government will introduce a system of formula assessment to complement the present reforms in assessing the capacity to pay and what constitutes adequate maintenance. As the Minister has acknowledged, effective collection is only part of the problem. This legislation deals more specifically with and amends maintenance income tests which are dealt with in the two major pieces of legislation which I mentioned at the commencement of my speech. The Bill implements a separate pension and benefit income test on maintenance income; it implements the imputation of capital lump sum maintenance and the imputation of in-kind maintenance as maintenance income; and it implements special protection provisions to avoid hardship being caused under the provisions mentioned above. I think it is important to look at some of the problems which this legislation addresses. In-kind maintenance takes many forms. For example, it may include food provided, household items supplied, the payment of medical insurance, education and car expenses, and the like. I would have to acknowledge and agree with the point made by the honourable member for Curtin, who preceded me in this debate, that there is a real need to prevent people using these types of in-kind maintenance to circumvent the system. It is important to note that, unfortunately, not all of the families that we are talking about have the ability to effect in-kind maintenance payments. It would be unfair if those who are able to effect payment only by cash were not treated the same as the more wealthy in the community who are able to effect in-kind maintenance payments. It is important that we look at the way in which we treat capital transfers either in respect of the transfer of substantial lump sum capital or in the context of the distribution of property following a divorce. There is a real need to indicate clearly in those capital transfers what is maintenance income and what is involved in respect of other forms of distribution. The two shadow Ministers made very disappointing contributions when this Bill was previously debated in this House. The honourable member for Farrer (Mr Tim Fischer), in his capacity as the shadow Minister for Veterans' Affairs, unfortunately tried to embark upon a form of fear campaign that has characterised much of the debate over veterans entitlements legislation in the past. If we really look at this legislation we will see that the overall effect on veterans entitlements legislation is minor. The honourable member does himself a disservice by claiming that this piece of legislation will in some way heighten the confusion and fear out in the veterans community. I think it is clearly acknowledged by many members of the veterans' community that there is very little argument against this Government's record in this field. It is appropriate that the Minister for Veterans' Affairs (Mr Humphreys) is at the table. Last week I attended a function in Victoria which celebrated the seventieth year of the Department of Veterans' Affairs or, as it was known for most of that time, the Repatriation Department. This function commemorated 70 years of service of this Department which commenced operations in King Street. By way of digression, on that occasion the Minister reflected on what a difficult task it must have been in those days-70 years ago-for those who were asked to oversee the implementation of the then legislation when they had nothing to fall back on. There were no precedents; they were starting from scratch. When we look at some of the reforms which have taken place, such as this legislation, which is part of the overall reform of the child support scheme, again we reflect on how difficult it is even now, when we have some 40-odd years of history of a social security system in this country, to start not quite from scratch but to commence a system which tries to address a lot of inequities and inadequacies. The work and consultation that have preceded the putting together of this package have been very important. That importance is reflected by the fact that, in the main, the scheme has received bipartisan support. People should not use it to score points as it is a very real concern to those who find themselves belonging to single parent families or being a single parent. It is a bit difficult to talk about the real impact of changes to procedures. The honourable member for Curtin, perhaps at a more partisan point in his contribution, described loosely the family allowance scheme (FAS) as being an exercise in buying votes. I ask the honourable gentleman whether he decries the redistributive effects that give many families a real chance. I note that he spoke of one aspect of family life being important; that is, the ability to take family holidays and the like. It is unfortunate that, for many recipients of the FAS, what we are really talking about are not luxuries that family holidays represent but bare necessities-necessities such as a new pair of slippers or a dressing gown for a child. Their ability to clothe children properly poses a very real problem. It is not just something in people's imagination. Many families in Australia require what people might term basic necessities. We need to assist them so they can get such items. It would be remiss not to mention the fact that when the Minister for Social Security presented this piece of legislation to Caucus for its consideration it was an historic occasion because he included a social justice impact statement. That was very important because it not only gave us an opportunity to look at the financial implications but also allowed us to address the problems and to establish a strategic way of thinking of how we should implement different policy. The Minister is to be congratulated on providing the statement that accompanied this legislation. It is well known that the Government is embarking on a more strategic insight into the way in which it delivers some of its policies. We are looking at the four main arms of the social justice strategy-that is, equity, equality, access and participation. This legislation attains those requirements in a number of ways. Regarding equity, the Bill will achieve a fairer distribution of social security expenditure by the income testing of all forms of maintenance. We must consider the dual part of the legislation. Social security entitlements will now be assessed according to the level rather than the form of maintenance received, which, as I said earlier, was unfair. In the past, only those in receipt of cash payments were subject to income test requirements. Now there will be a broader definition of what maintenance really is and we will be able look at the various ways in which maintenance can be received. I look forward to the further developments of the child support scheme. The Australian community needs to acknowledge that there is a real need to address the problems of the many thousands of young Australians who are members of single parent families. It is remiss that on some occasions, loosely and rather quickly, some might dismiss single parent families as being single parent families not from necessity or circumstances beyond the control of the parent. The figures decry any notion in the wider community that there are those who become single parents because in some way it gives them the key to the door to some form of easy life. That is a rather obnoxious way of thinking. I do not think there is any evidence that that is the case. It is an unfortunate reality that many single parent families are the result of failed marriages and failed relationships. I think that we should not only ensure that we put into place measures such as those contained in this legislation that try to address the problems of those families but also put our minds to addressing preventive measures that ensure that we do not see a further increase in the number of single parent families. We should be looking at proper marriage education or, more importantly, a proper family relationship educative processes that ensure that many who go into relationships which are doomed to failure can at least have some access to programs that will assist them to be able to reassess whether those relationships are worthwhile. We must do that and start addressing that as a problem or we will be only plugging gaps with the sorts of measures that are before us today. Mrs SULLIVAN(Moncrieff)(11.03) —The honourable member for Scullin (Mr Jenkins) was quite in error when he took the honourable member for Curtin (Mr Rocher) to task for the statements that the honourable member for Curtin had made criticising the Government on this measure in terms of cost saving. He said he was disappointed that the honourable member for Curtin chose to talk about the Government's motivation in terms of cost saving. Whilst I would acknowledge the sincerity of the honourable member for Scullin in today's debate in his concern for families, I am sorry that he does not appear to be better aware of actions that his Government has taken in the last two years which have immeasurably increased the hardship of those attempting to rear children in one-parent families. He pointed out, quite rightly, a number of family assistance packages, but I am afraid that he fell into the trap, which is all too common amongst Government members of taking the Government's rhetoric at face value and not paying enough attention to the reality of a number of the policies that the Government has introduced. Later in my speech I will mention a couple of the initiatives that the Hawke Government has taken that have adversely affected single parent families over the last couple of years, but first of all I turn to the Government's rhetoric. The Minister for Social Security (Mr Howe) stated in his second reading speech: For too long poverty has been the traumatic result of marriage breakdown for children in sole-parent families. This Government is committed to ensuring that by 1990 no child need live in poverty. The child support scheme is a central part of our program to achieve that objective. Today we are debating a Bill which is part of the child support scheme. The Opposition welcomes the thrust of the Social Security and Veterans' Entitlements (Maintenance Income Test) Bill in so far as it will make maintenance collection a function of government in an attempt to ensure that more families will receive maintenance from non-custodial parents. The Opposition, however, is critical that it has taken the Government so long to act. This criticism has been made in several debates over the last three or four years. The Fraser Government in 1982 commissioned a report into the collection of child maintenance. That report was delivered to the Hawke Government early in its tenure in 1983. In other words, the report was not completed by the time the Fraser Government went out of power. The Hawke Government, for political reasons, decided not to proceed on the recommendations of that report. So it is now five years later that we are taking serious steps on the issue-steps that could have been taken five years ago. All children have two parents, except where one parent has died, and this Bill does not apply in that case. The problem we face is that of the parent who walks away from the financial responsibilities to children and, I might say, to the custodial parent. I do not believe that the responsibilities of the non-custodial parent end just with the children. A number of the parents are not facing either of those responsibilities. If it is necessary that custodial parents cannot derive income of their own-as I said, perhaps because their children are young or disabled-non-custodial parents have an ongoing responsibility to custodial parents. That is probably a subject for another day. I also want to make the comment-a comment I have made in previous speeches on the subject-that it was never the intention of this Parliament that the Family Law Act be interpreted in the way it was by the Family Court of Australia regarding access to social security benefits for those who become custodial parents after divorce. The relevant section of the Family Law Act which has enabled this situation to arise was not inserted to give automatic access to welfare payments. I suggest that any people interested in the subject look at the Senate debates on amendments to that section. They will find that the intention of the Parliament was to make the matter of maintenance fairer for the person paying maintenance. It was not meant to allow people to walk away from the responsibility of maintenance. However, the Family Law Court subsequently interpreted that section of the Family Law Act in that manner. We have now amended the Family Law Act to reduce the Court's ability to rely on the payment of social security where a non-custodial parent can pay maintenance. It is unlikely that the sentiments the Minister expressed in the section of the speech I have just quoted will have much effect. He was saying that this is part of the central program to reduce child poverty. There are three groups of recipients of supporting parent's benefits. Firstly, there are those whose co-parent does not have the means to contribute to maintenance of the ex-spouse and the non-custodial parent's children-and the Bill specifically excludes those people from paying maintenance. I refer to people who are social security recipients. Secondly, there are people whose co-parents have the means but walk away from their responsibilities. The changes we are debating today essentially apply to that category of supporting parent's benefits recipients. Thirdly, there are those people who can afford to make financial contributions but who enter into private arrangements with the custodial parent. This is the category of people to whom the honourable member for Scullin was referring-the so-called middle class rip-off of the social security system. I point out that the third group is unlikely to be in poverty. That is the group where the non-custodial parent, usually the father, enters into arrangements to pay school fees, retail store accounts and so on, but this has not been classified as maintenance. Therefore, the custodial parent is shown as having no income from the non-custodial parent and has been able to claim the supporting parent's benefit. In this case, the supporting parent's benefit has been an addition to family income. However, the people who have entered into that type of arrangement are not likely to be the ones whose children live in poverty, at least partly thanks to these very arrangements. So the second group I have referred to, where the non-custodial parent could afford to pay maintenance to the custodial parent for their children, but who make little or no contribution, is the group we should be most concerned about. The position of sole parents in this country has been well documented for years. That documentation clearly shows that the problem of poverty in sole parent families is essentially a female problem. I have some figures, unfortunately not particularly recent but the most recent ones available, that graphically illustrate the comparative position of a sole parent. I refer for a moment to those people who are not receiving the supporting parent's benefit. Thirty-nine per cent of female sole parents are in paid employment, so 61 per cent of female sole parents are not in paid employment and presumably contribute the bulk of women on supporting parent's benefit. That 39 per cent of female sole parents is contrasted with the figure of 84 per cent of male sole parents who are in paid employment. That makes it quite clear that the male sole parent is in a superior position to earn income compared with the female sole parent. The problem demonstrated by those figures is compounded by the fact that the female sole parent who is in paid employment will earn, on average, only 76 per cent of the level of income of a male sole parent. So with all the difficulties that come with being a sole parent, even for those who can remain in paid employment, the financial difficulties are sharper for the female sole parent. This was underlined to some extent-I believe inadvertently-by the Minister in his second reading speech when he made the statement: It is expected that additional non-maintenance income- that is, income earned by the custodial parent- will generally be in the form of casual or part time earnings. So the financial situation that custodial parents, particularly female custodial parents, have been locked into for a decade will not change in structure very much through this Bill, on the Minister's admission. The real issue of child poverty in single parent families centres on access to work, maybe also to education and training, by those people who are custodial parents. Many parents, male and female, who are capable of employment, will decide for a number of reasons not to go into employment, at least initially. For example, where the children are very young the custodial parent may well judge it more appropriate to remain at home caring for them. Under these circumstances those people tend to adopt the same characteristics as the long term unemployed. They have these characteristics to a more extreme degree because they are likely to be out of the work force even longer than the long term unemployed. Long term dependence on the supporting parent's benefit erodes people's job skills and makes whatever job skills they may have had-which, in the case of women, in times gone by were likely to be minimal-even more obsolete. These two factors reduce their employability. Further, their long absence from the work force makes them very unattractive to employers. In response to that, the Government claims that it has been spending money-as it has-on reskilling people who are dependent on the supporting parent's benefit and on widows pensions. The Government however has introduced parallel policies which have been particularly cruel and which have added to the difficulties of the supporting parent. In the 1986 Budget the Government introduced a requirement relevant to the supporting parents beneficiaries and widows pensioners. I raise this matter because of the comments of the honourable member for Scullin and others in this debate about the Government's intentions and understanding of the problems it now addresses. I quote from a statement that appeared in 1986 Budget Paper No. 1: The Government has decided to improve the administration of supporting parent's benefit and widow's pensions by more regular reporting, to ensure continuing eligibility, and counselling which will assist the recipients to find work and thus reduce outlays. From October 1986 recipients will be required to report to the Department of Social Security on their circumstances each month during their first three months on benefit and quarterly thereafter. In debate on that Budget I questioned the Minister for Social Security as to whether that was in fact the Government's intention. If it was the Government's intention to provide the support of counselling to find ways to have people enter the work force so that they were no longer dependent on social security, the expense would have been fairly high. Nevertheless, this initiative, presented in positive rhetoric, was shown in the Budget Papers as a cost saving measure. In fact, that counselling has never taken place. That initiative was only ever meant to check up on whether people were still eligible to receive their benefit. I noticed some ministerial advisers starting to write vigorously when I said that counselling has never taken place. I suggest that they check the Hansard transcript of evidence given recently by representatives of the Department of Social Security of this matter to a committee of the House of Representatives. This initiative had a policing function. I suggest also that the advisers check the transcript of evidence given by Department of Employment, Education and Training representatives. If there was to be a counselling function for those on supporting parent's benefit-not those about to be taken off the benefit-the Commonwealth Employment Service would have been involved. That statement in the Budget Papers of 1986 was news two weeks ago to the Department of Employment, Education and Training. In that same Budget, the Government reduced educational allowances for social security beneficiaries. Whereas previously such people were eligible for the tertiary education assistance scheme, now Austudy, that eligibility was removed in 1986 so that access by social security beneficiaries to education and training was further hindered by a financial obstacle. In 1986, social security beneficiaries who wished to pursue education found themselves $23 a week worse off as a result of that decision of the Government-another cost saving measure. I have said that that statement in Budget Paper No. 1 of 1986 standing in the Government's name was untrue. The Minister for Social Security may not have been responsible for its being there. It has transpired that the counselling proposal was nothing but empty rhetoric and was never meant to be anything else. When I questioned the cost of this additional counselling in debate on this matter, the Minister said that compared with the savings involved, the cost was minor. At no stage did the Minister indicate to this Parliament that the counselling function would not be undertaken, nor did he indicate that instructions were not given to the Commonwealth Employment Service that it would shortly have to counsel large numbers of social security recipients about their rights of access to job training schemes, because, of course, that counselling was never set in place. In that sense, the Minister connived with the untruth of the Budget Paper, even though he may not have been directly responsible for that untruth. Of course, more recently, as a result of the May statement of 1987, all recipients of a supporting parent's benefit or widow's pension lose that benefit when their youngest child attains 16 years of age, regardless of whether that child is still in full time education, and regardless of whether the recipient is attempting to educate other children, for instance, at a tertiary level. That action is taken after only six months notice. In this regard, the Government has shown an extraordinary lack of understanding of the real needs of people attempting to rear children single handedly. The real issue of child poverty in this country-those categories of supporting parent's benefit recipients who will not receive additional support from the non-custodial parent or who will receive very little support-centres on the availability of child care and the refusal of the Government to consider support for alternative types of child care to that which is presently being funded; the almost non-existence of after school care for the children of those who would want to enter the work force and earn full-time wages; and the obstacles to access to education and training, a number of those obstacles having been raised by this Government. This Bill will force some parents to face some of their financial obligations. It will relieve the Government of some public expenditure. It will have little effect on child poverty. Mr WRIGHT(Capricornia)(11.21) —The honourable member for Moncrieff (Mrs Sullivan), who has just resumed her seat, admitted that some of the facts and figures she brought to the debate are old and out of date. I suggest that much of her contribution was out of date. She completed her contribution by referring to child care. She said that the Government had done nothing about child care. I remind the honourable member that the last budgetary allocation for child care by her Government, the Liberal-National Party Government, amounted to some $45m, when there were some 40,000 child care places in this nation. This year, this Government will spend $229m and will create 110,000 child care places, providing day care, all care, and after school care. It is quite amazing that the honourable member should make the criticisms that she made knowing full well that her facts and figures were not only out of date but in most instances, wrong. No government has an easy task in attempting to address the many community problems that affect people. Most governments are faced with everyday demands from business and the community to address economic problems and to ensure that issues such as trade are constantly on the agenda. Governments are aware of the demands of local governments and people generally about issues such as roads. Governments tend to spend their time on such matters. But this Government, the Hawke Labor Government, has given a different emphasis, which has been targeted at people. It has been this Government that has brought down reports pointing out that during the past year there were some 800,000 children living in poverty. It has been this Government that has been acting directly, by direct funding to families, and indirectly to address that problem and to redress the difficulties. This Government introduced Medicare. The Opposition wants to scuttle Medicare. This Government introduced the first home owner's scheme. The Opposition, the Liberal and National parties, want to scuttle that scheme. This Government brought about the fee relief for child care, increased the number of child-care places, and introduced the new system of Austudy. This Government increased the tax free threshold and changed completely, and restructured, the tax system so that it impacts less on low income earners. This Government has given a new commitment to solving problems associated with children in poverty. There is no magic wand. It comes back to commitment and to money. It comes back also to a need to understand that governments cannot play the big brother; they cannot introduce policies and hope that in some magical way all parents will adhere to those policies. Certainly, the Government can put in place measures that will give greater purchasing power to families. The Government can overcome poverty traps. But it comes back finally to those who are responsible for children in this country acting for those children. I find it disgusting, when there are thousands of young children living in poverty, that approximately 70 per cent of non-custodial parents make no contribution whatsoever to the maintenance of their children. Hundreds of thousands of families in this country suffer because non-custodial parents-regrettably usually of the male species, the man, the husband, the father-make no contribution whatsoever towards the maintenance of their children. This is not new; it is not something that has happened in 1988. It has been going on for years and years. What did the honourable member for Moncrieff ever do in the Senate or in this place to solve the problem? What did the Liberal-National Party coalition she represents ever do to try to solve the problem? They were not game. We cannot win on this issue. The moment we start trying to make people pay their way we come up with the rough cases. We almost need the wisdom of Solomon to address some of these difficulties. I can give case after case of the sorts of problems that exist. For example, there is the problem where the husband, the father, is not only committed to paying maintenance, but also has forgone the house-he has left the house and given it up-and finds that the wife, in many cases the ex-wife, has a relationship with someone else and is getting some sort of sustenance or maintenance in a cash or kind form and she is also getting maintenance from the father and benefits from the system. That is the sort of problem we face. There are cases where men on considerable wages, who live in prosperity, just walk away from their families. I take the point from the honourable member for Moncrieff and I agree with her that it is the women and children who suffer because that man simply does not take up that responsibility. But what did her Government ever do? Nothing. Mrs Sullivan —What did you ever do? Mr WRIGHT —This is the Government that has moved. This is the Government that introduced the Child Support Act. This is the Government that addressed the problem through the family law system. This is the Government that is ensuring that fairness and justice prevail, that people first of all have a responsibility to try to get assistance from other quarters before they come to the welfare system and say, `Give me, give me, give me'. This is the Government that is now introducing legislation that says we will take into consideration maintenance in kind. We know that for years there has been a presentation of poverty when in fact there have also been major capital transfers, there has been the availability of a house, there has been payment of educational allowances and there has been payment of medical insurance. In some cases these things are hidden. I do not deny anyone the right to receive that sort of assistance because it gives them a better quality of life, but it takes a government with guts to say, `Let's do something about it and make sure that the recipients, first and foremost, carry out their responsibility to try to get their maintenance and sustenance from those who ought to pay'. What did the Opposition do when in government? Nothing. Opposition members can criticise us now, but for years they knew that the problems were there and they did not bother to act. It has been this Government that has ensured that a system is put in place that will officially collect maintenance from the non-custodial parent based on the ability to pay. This is the Government that has decided that it will ensure that those who have children accept an ongoing responsibility to those children, given the capacity to carry out that responsibility. This is the Government that has said that it understands that family breakups will continue but that they shall not always be a burden on the welfare system and therefore on the taxpayers unless it is clearly shown that the custodial parent cannot pay or for whatever reason-and there can be many reasons-it is impossible to collect that maintenance. But we are going to try. This has been happening in this legislature now for some months as this Government bites the bullet to try to rectify a gross problem, a problem that has affected 800,000 children across this nation, hundreds of thousands of families and hundreds of thousands of women. There is case after case, but for every case where clearly the husband is in the wrong one can throw up a case where the wife has done the wrong thing too. As I said, we need the wisdom of Solomon sometimes to rectify these problems, but we are trying. While I accept the role of the Opposition to criticise, I believe that criticism should be constructive. That criticism should also have a theme within it that says credit should be given where credit is due. It amazes me that people such as the honourable member for Moncrieff get up and bash away, saying that nothing has been done, when in fact so much has been done. Let her say whether she stands by the Opposition's policy of getting rid of Medicare. That Medicare system is bringing a new quality of life to the health care of something like two million Australians, the millions of Australians she says she wants to help. Yet her own Party wants to get rid of Medicare. Let her say how she, as an individual member of Parliament, would address those problems. It is not just a matter of giving cash. It is not just a matter of giving help in kind. It is a matter of ensuring that those people have specific problems overcome, be they educational, be they health, be they recreational. They are the areas that concern me. I personally believe that so much of the poverty in our nation has been covered up. We do not see it. Many people do not see it because of the wonderful work that is performed by groups such as the St Vincent de Paul Society, the Salvation Army, the churches and the charitable groups. They are bandaiding the problem and we do not see the blood. We ought to open our eyes and see how bad it is. Whilst we can see the quality or lack of quality of a house that some people live in, we do not stop to think enough about the other disadvantages they may be facing, the deprivation that is occurring at a frightening level in the areas of culture, sport and recreation, and in education. People in poverty do not have access to participation in all types of sport and recreation. They are the things that I believe bring down the person, and they are holding down hundreds of thousands of young people in this country. This Government is endeavouring to solve the problem. Whilst I accept the role of any opposition to argue and criticise, it is time that this Opposition came forward with some constructive ideas. I sometimes just give up on the Liberal and National parties here because they come up with nothing. Mrs Sullivan —Do not get downhearted. Mr WRIGHT —The honourable member interjects. In the last election I had the highest increase in support in the nation. The response was fantastic when the Prime Minister (Mr Hawke) came to my electorate over the weekend. We expected 1,000 people to attend the opening of the Aboriginal Cultural Centre and 4,000 turned up. So I suggest that the honourable member should close her trap and listen. This is the Government that is acting for the people of Australia. This is the Government which has, by way of legislation and by way of its policies, moved to overcome the poverty that exists for so many. It is time the Opposition joined in supporting us in these measures instead of criticising and opposing them. Mr DOBIE(Cook)(11.33) —I am pleased to speak on the Social Security and Veterans' Entitlements (Maintenance Income Test) Amendment Bill. It is a progressive step towards finding the solution to the problems facing what is fast becoming the most needy section of the Australian community, the children of broken marriages, or as we now seem to call them, the children of single parent families. It is a good thing for the parliamentary process to have the Cabinet Minister, the Minister for Social Security (Mr Howe), admit that there is a serious drop in the living standards of the children in sole parent families throughout the country, and for him to bring in further legislation in a serious and what I believe to be a sincere attempt by him to overcome what has been an area of moral indignation and social comment by all sides of the Parliament. Yet action by either the present or the former Government has not been such as to halt the growth of this expanding social welfare problem. I take this opportunity to say that I support the child support agency which was established under an Act of that name. I am hoping that that experiment, along with the experiment of this Bill, proves successful in collecting maintenance from those liable to pay it without social, financial or psychological damage to single parents or their families. During this debate-and the last speaker, the honourable member for Capricornia (Mr Wright), was a clear example of this-there has been too much toing and froing by both sides as to who is to blame. I do not include the honourable member for Moncrieff (Mrs Sullivan) who I thought made a magnificent contribution to the Bill and reflected her long time involvement in this area of concern. She has played a major role within the Liberal Party and in the formulation of our policies. I take the time of the House to repeat what the honourable member for Bradfield (Mr Connolly) said when he quoted from Opposition policy: We will amend the Family Law Act to restore the primary obligation of parents to maintain their children, while confirming that support will continue to be provided for families in need. One does not need to be a great grammarian or scholar to understand that simple statement, which was put forward very forcefully. It should be remembered that the honourable member for Moncrieff, who preceded me, and the honourable member for Sturt (Mr Wilson), who will follow me, had a great part to play in coming forward with this policy-a policy which, it should be pointed out, was taken over by the Government subsequent to our announcement of it. I do not wish to make political comment on this except to say, along with our shadow Minister, that we should get away from the nonsense that concern and care for this problem resides on one side of the House. That is absolute and arrant nonsense. I hope that members of the public who are listening to it are aware of this. The cold hard fact of the debate and the Bill is that the problem itself has not been fully recognised by the community or the social welfare organisations. In my opinion, their efforts have been put into the problems facing the breaking up of marriages and of relationships. It has taken a long time for the social welfare community and the political world to appreciate fully that the real victims are the children of broken marriages. It is only in the past couple of years that we have begun to see a wider awareness of how serious the problem has been. Before I talk of my own district, on which subject my own party room is absolutely sick to death of hearing me talk, I should mention that I have not heard in this debate about what has been happening with this problem of children of broken marriages and the awesome acceleration of that problem within our community. Just when those of us who have been concerned about it for a number of years think we can see a solution, something goes haywire, because suddenly twice as many people are involved. Suddenly, the growth of social lawlessness amongst children, subteenage and younger, in areas of concentration of single family units, leads us to think that one of the real problems we have to face this time is not just money, cash, in-kind or whatever. But we have to have that. Our whole social welfare community has to understand that we have major public psychological problems to consider and confront. I have been made aware of this area, not because I have a specific interest in it, but because for many years now my electorate in Sydney has been one of the areas where there has been a major concentration of single parents. This is brought about because Cronulla is the only beach suburb within the Sydney metropolitan area on a train line. So single parents have brought their families to the area, thinking it is an ideal spot. For some years I was able to tell my colleagues in my own Party that we had one of the highest supporting parent benefit recipient concentrations in the whole of Australia. This has been changing dramatically and the number has dropped dramatically. I should like to be able to tell the House that that has occurred because there has been a reduction in the number of single parents. But that is not true. The primary schools in my area, both public and non-public, still have an awesome percentage of children who come from such families. The problem cuts right across socioeconomic barriers. Yet Cronulla, this middle Australia suburb, with one of the most beautiful beaches and being one of the prettiest areas in Australia-- Mrs Sullivan —In New South Wales. Mr DOBIE —In Australia-has one of the most serious problems of lawlessness amongst subteenage children. When gangs of children aged between nine and 12 years are bashing up adults and persons of their own age group, it becomes a very serious social problem for a district. This is no underprivileged area of Australia; this is middle Australia. The honourable member for Scullin (Mr Jenkins) referred to it. But, along with the honourable member for Moncrieff, I believe he missed some of the problems of middle Australia. I should like at this stage, within the context of this Bill, to say that we really have to start thinking of the problem not just of child maintenance, which is the subject of this Bill, but also of child supervision. Mrs Sullivan —After school care. Mr DOBIE —After school supervision, after school facilities. The problems around Australia between 3.30 and 6 p.m. are immense. They are not acknowledged because they are not seen, because the parents are working. These children who are unsupervised have no guidance or leadership to bring them along the right road. People of my generation do not understand that, because that was not the case when we were young, some decades ago. Authorities, governments, oppositions and people in public positions cannot ignore this problem any more, because, if these children are allowed to go through life without leadership, without guidance, without some control or supervision, then the Australian community will suffer well into the future. Let us start thinking of the twenty-first century, starting with lawlessness amongst our young community. Madam Deputy Speaker, like you, I realise that one should not go beyond the confines of the Bill before the House. Although some who contributed to the debate have, I will not. While the matter of school child supervision must be closely related to child maintenance, one must also accept the fact that it is not a Federal responsibility, on the face of it. The use of school playgrounds and school facilities is a matter I am pleased to see the new Government of New South Wales addressing itself to. I think I am right in saying that. The use of those facilities is a matter that must be closely related with the Bill before the House. I would like to say that if we do not do that, it will be to our cost. It has been a shame that in this debate there have been instances of honourable members yelling across the chamber and accusing others of not having an interest and not having `done anything'. Mrs Sullivan —Who said that? Mr DOBIE —We had this accusation from the honourable member who spoke just before me, amongst others. But I do not wish to get caught up at this stage in a political brawl. I believe the Minister has to be congratulated for several things. One is for bringing forward the Child Support Act, the Family Law Amendment Act, and this amendment to child maintenance legislation. I feel sure that he, too, knows that these pieces of legislation are not the final answer. All of us who are concerned know that they are not the final answer, but in my opinion they make substantial progress towards solving a massive problem. The honourable member for Capricornia, when talking about-quite frankly, I forget what he was talking about; maybe I am getting too old. Mr Connolly —Eminently forgettable. Mr DOBIE —The honourable member for Bradfield has said that it was eminently forgettable. However, the honourable member for Capricornia was talking in broader terms about who had a concern for the problems. Let me assure him that on this side of the House we are close to our constituents. We are close to the problems that face us. I suggest to him that he may follow that track. I get back to the Minister. I congratulate him on the Bill he has brought in. I congratulate him on his sincerity. I also congratulate him on what he has done because he has done something that I cannot recall having seen for a long time in this place. He has made his own ministerial staff available to Opposition committee members and other interested members on this side of the House to discuss and explain precise details of the Bill. I hope this is a practice that will continue. I hope that some honourable members opposite who have tended to scream about this subject may attend similar committee meetings within their own party structure because the problem before us today is not a Labor problem, it is not a Liberal problem, it is not a National Party problem; it is a problem that faces all of us in this House if we have a sincere concern for the welfare of our own community. The honourable member for Moncrieff, who has, as I have said a couple of times already, a very wide experience in this matter, has shown that on the face of it things are just not what they appear to be. Any of us who have been connected with the social welfare scheme for the last 20 years, 30 years or, in the case of some of us, even longer know that this is the case. There are not going to be any glib solutions. Glib speeches will not suddenly wipe a problem away. Articles by me in the local papers in Cronulla and the Sutherland area expressing horror and concern do not get the children who are causing trouble off the streets. The fact that they have better maintenance, that they are better clothed and better fed, and that their mothers are less worried about them is no solution to what they are doing in those two or three hours late every afternoon. I have been disappointed that this matter has not been dealt with in this Bill which refers to child maintenance. I wish the Minister well in his endeavours for I am sure that he will not regard this as a final answer. I almost said a `final solution' but I realise that that has broader connotations. Therefore, I say that I do not believe that the Opposition can stand condemned in any way for not showing an interest or a sincere concern. I support the legislation but I also support what the honourable member for Bradfield has brought forward as an amendment. It is not pious. It is not pompous. It states facts which I hope will be addressed by both sides of this House in the continuing debate which will not finish with the conclusion of this debate today. Mr WILSON(Sturt)(11.48) —The prime objective of the Social Security and Veterans' Entitlements (Maintenance Income Test) Amendment Bill now before the House is to change the means test as it applies to the determination of the amount of supporting parents' benefits and widows' pensions payable to supporting parents. It proposes this change because of some earlier legislation passed with a purpose, hopefully, of increasing the responsibility assumed by non-custodial parents for the maintenance of their children. I have said in this House before, and I say it again, that the public policy objective of a tax system designed to levy taxes on the ground of capacity to pay, like the public policy objective of a social security system designed to assist families, should give adequate tax relief and/or adequate cash family allowances to families who support children. That adequacy should be tested on the ground of what is the cost to a family of maintaining children. There has been a lot of talk about it being the responsibility of parents to maintain their children. That is true. But it does not face the central issue, which is: How do we view children? Are children part of our community and the future of the nation or do we treat them like we treat all consumer goods and regard them as a total cost to the parent? If we do, let us look at what that total cost involves. A man called Loveridge in a study conducted by the Institute of Family Studies prepared some very interesting information. He estimated-I am using figures updated to December 1987-that it would cost a low income family $1,178 a year to maintain a child two years or under; a child two years to five years would cost $1,500 a year; five to eight years, $1,853 a year; eight to 11 years, $1,967; and a teenage child, $2,929 a year. They are the figures for a low income family with a very spartan form of existence. For higher income families the figures were significantly greater. Therefore, the cost of maintaining a child in 1987 dollars up to the time of the child's nineteenth birthday for a low income family would be $38,290. Loveridge's estimation of the cost for a middle income family was $59,740. We have to ask ourselves whether that cost is to be assumed by the parent and whether the parent is to be required to make a choice between bringing up a child and thus incurring that expenditure and having that money available for a trip overseas, a cottage at the coast or a luxury motor car. In my view, to face Australian families with that choice is absurd. Our tax and social security system should provide full and adequate tax deductions and cash rebates in the form of family allowances that take account of the full cost of maintaining a child. However, the present system does not do that. We have totally inadequate family allowances-family allowances that this Government has failed to index. Whilst the Government has claimed it has reduced the deficit, it is reducing the deficit at the expense of Australian families and the children in those families. The Government is saving something like $1 billion a year because it is being so mean and so short-sighted about the importance of providing adequate family allowances for all Australian children. It is true that in separated families there has been a total failure on the part of non-custodial parents to discharge fully the responsibility that they should be taking. In my view the means test that is proposed in this Bill should be designed in a way to ensure that separated parents take as much responsibility for their children as do the parents of intact families. Of course, that would not be necessary if we had a sensible tax and social security system that provided fully by way of tax relief or cash allowances for the cost of maintaining children because then maintenance above an adequate minimum standard for all children could be a matter left to the parents or, when there was a dispute, determined by the courts, with public policy being formulated on the basis of governments knowing that every child had an adequate support through the tax or social security family allowance system. That is not the case because when a family separates we quite rightly say that it would be totally impossible for a supporting parent to support children on the very meagre, mean family allowances currently paid to all Australian families other than those with the very highest of incomes. If it is to be the responsibility of parents in intact families to pay out of their after tax income the cost of maintaining their children, educating them and giving them a good start in life, the non-custodial parents in separated families should be required to shoulder their responsibility at least to the same degree. If the existing means test were maintained, families who increased their maintenance payments, as those payments should be increased, would not relieve the taxpayer unless the maintenance paid was at a very high level. We have to recognise that, under the present means test, as it applies to the supporting parent's benefit, there is no reduction of the allowances in respect of children until the maintenance, assuming that there is no other income available to the supporting parent, is in excess of $46 a week for one child or $52 a week for two children. Under the existing income test, the allowances that are provided to a supporting parent for children-the mother's /guardian's allowance and the child supplement-would not cut out altogether unless the maintenance payable were at the rate of $114 a week for one child and $164 a week for two children. The objective of the proposed means test, of the maintenance collection agency and of the change in requirements under the Family Law Act should be twofold: firstly, to help lift out of poverty children who are now in poverty and, secondly, to relieve families who are taking responsibility for the maintenance of their children of the tax burden that they are now carrying to provide maintenance for other people's children. Clearly, the present means test applicable to the supporting parent's benefit would be totally inadequate to bring about any significant reduction in Government expenditure, so the Government has introduced a new income test. It has been sensitively designed to preserve work incentives by having a separate maintenance income test, distinct from the income test that will relate to other income derived by any supporting parent. The Government has reduced the threshold at which the pension starts phasing out from $46 a week for the first child and $52 a week for two children to $15 a week for the first child and $20 a week for two children. Let us look at that measure. The additional allowances payable in respect of children and the mother's guardian's allowance will not cut out where there is one child aged under 13 years until the maintenance payment by the non-custodial parent is $83 a week; and, for two children, until the combined maintenance payment is $132 a week. I hope that when the Government introduces its formula for the collection of maintenance it will be based on non-custodial parents who are in the full time work force discharging their responsibility to their children to the same extent as parents in intact families and their children not being a charge on the public purse. I hope, therefore, that the non-custodial parent in the full time work force, with one child, will be required under the formula to pay maintenance of not less than $83 a week. That will do two things. It will relieve the public purse of the costs of maintaining those children. Furthermore, it will massively assist the families of those children in lifting the children out of poverty. Unless that happens, the Government will not make the projected savings. As I understand the figures, a large expense is incurred on the supporting parent's benefit. The total amount is of the order of $1.8 billion a year but, of that, $1.3 billion or $1.4 billion is the cost of providing the supporting parent with a pension equivalent to the age pension, the widow's pension or the unemployment benefit. All that happens is that the supporting parent becomes entitled to the unemployment benefit without being subject to a work test. The reason she is not subjected to a work test is that she has children in her care. The former supporting spouse, the former husband, is relieved of the responsibility of supporting his wife. He loses the $1,030 spouse rebate, but he does not have to feed or clothe his wife or, under the present arrangements, with the inadequate maintenance collection system we have had up to now, provide much for his children. He has the same income that he had when he had his wife and child or children in the same household, with the exception of that $1,030. That $1.4 billion will still go to the supporting mother as a child carer's allowance or mother's allowance, which is payable to a separated family but not to an intact family, to whom we give only $1,030. So the amount that this scheme would potentially save is about $500m. That would relate to the supplements that are paid in respect of children of supporting parents. I question the Minister's figures. I have been very pleased to have spoken with his staff and to have had some explanation of them, but I just do not believe that the public purse will make the projected savings unless there is a formula that achieves the objectives that I have outlined. I want to draw to the attention of the House the comparison of a family on approximately average weekly earnings with two children. I approximate average weekly earnings at the moment to about $25,000 a year. That family, with two children, living together in a happy family home, would be liable to pay tax of $6,001, reduced by the $1,030 spouse rebate and increased by the Medicare levy of $313, increasing the family disposable income and in effect reducing the net overall tax liability by $664, being the universal family allowance payable to the majority of families. So that family would have a disposable income of $20,380. Let us say that the family separates and the non-custodial parent pays no maintenance. The non-custodial parent is the one who is earning $25,000 a year, so he pays tax of $6,001 and the Medicare levy of $313. He has a disposable income of $18,686. What happens to his wife, the mother of his children, and to his children? They receive the basic supporting parent's benefit of $6,053, guardian's allowance of $626, a child supplement of $2,294 and the ordinary family allowance of $664. That gives a total disposable income available to the mother and her two children of $9,637. The total disposable income of that group, albeit that they are not living together, is $28,323 as compared with the disposable income available to the intact family of $20,380. So the separated family is $7,943 a year better off. My concern is that public policy is not treating families with children in a fair and equitable fashion. It is not giving sufficient allowances for children to the intact family. Let us look at the break-up of that $7,943. Of that $6,053 is the single parent benefit. The spouse has left home or been kicked out; she would get a job but she is not able to do so. Because she is not cohabiting with someone else she is eligible for unemployment benefit. Her husband loses the spouse rebate, $830 of which is applicable to the adult spouse. Therefore $5,223 of that additional cost could be regarded as the benefit payable to the adult separated spouse. That is $523 more than the allowance we make to a husband who supports a dependent spouse or a wife who supports a dependent husband. One reform which would restore some equity would be to allow to any spouse who supports another spouse a tax rebate of the same amount that that person would get if he or she went onto the unemployment benefit. In the few minutes that remain to me I turn to the benefits that go to the children. The separated family gets a guardian's allowance of $626 and the child supplement of $2,294, an additional $2,920, which is reduced, perhaps, by $200 of the spouse rebate. Therefore a family is $2,720 better off in respect of the well-being of the children if it is separated. I believe that the intact family should receive assistance at least equal to that $2,720. I believe that it is imperative that some action be taken to ensure that this occurs. I also refer to the situation that occurs as maintenance payments are increased. In the case of a family on $25,000 a year, if the maintenance payments were at the level at which the benefits to the children cut out, the dependent mother's total income would be in excess of $13,500, whereas the father's income would be $11,000. This compares with the situation where there is no maintenance paid and the separated spouse receives an income of only $9,637. So the effect of requiring maintenance orders is to improve the standard of living of parents in-- Mr DEPUTY SPEAKER(Hon. J. D. M. Dobie) —Order! The honourable member's time has expired. Mr HOWE(Batman-Minister for Social Security)(12.09) —As honourable members have noted, the Social Security and Veterans' Entitlements (Maintenance Income Test) Amendment Bill is the third and final piece of legislation for the implementation of stage 1 of the child support scheme. The child support scheme is accepted by all political parties as a major step forward in providing secure income to sole parents and ensuring a fair and equitable system of maintenance assessment and collection. I want to acknowledge, particularly while the honourable member for Bradfield (Mr Connolly) is in the House, the support of the Opposition for the scheme. In Australia we have had a reasonably long tradition of a practical and realistic approach to family law reform which has been brought about in a non-partisan way. Particularly since the current Opposition spokesperson for social security, the honourable member for Bradfield, took over responsibility for the Opposition's approach on child support the tradition has continued in this area. Each of the three pieces of legislation has been somewhat complex. I understand the difficulty that oppositions have with such legislation and I appreciate the very considerable time that the honourable member for Bradfield and his staff have given to grappling with this legislation and, I suppose, in a biased way arriving at a fair and balanced assessment of it. I thank very much all honourable members opposite for the work that has been done and I particularly appreciate the contributions by them, both in this debate and in preceding debates. One thing that has characterised the debate on this legislation-apart from its somewhat less than partisan quality-has been the genuineness of the contributions made by so many individual members, both in this House and in the other place. In this area of reform there is a sense in which every individual feels that he or she has, perhaps, a somewhat extra interest in or more knowledge of what is being debated because of his or her own experience. The genuineness of the contributions is very much appreciated. The Opposition amendment to the second reading is a tactic which has become a pattern with social security legislation. Opposition members do not oppose the legislation but move amendments to the second reading which are completely irrelevant to the Bill before the House. In this case the Opposition's amendment is even worse than its previous examples of this tactic in that it is tendentious and, in places, simply wrong. I want to turn to the facts in relation to children in poverty, not only for the purposes of this debate but also for the purposes of a broader public debate. I refer particularly to clause 1 of the amendment, which talks about the increasing number of Australian families living below the poverty line and bearing the brunt of unemployment, including an additional 165,000 children. It would be simple enough to say that there are now 50,000 fewer children of unemployment beneficiaries than there were in 1983. I think it is important to look more systematically at the facts of the situation, particularly going back to the period of the previous Government. In 1976, before the Howard-Fraser Government had commenced hacking into the living standards of the poor of this country, there were 372,000 children of pensioners and beneficiaries. At that time payments for each child were 15 per cent of the married rate pension. Over the seven years of conservative rule the number grew by 50,000 children every year from 1976 to 1982. I ask all honourable members to recognise the horror of that reality-that during those six or seven years of conservative rule 50,000 children of pensioner and beneficiary families were being added to that figure every year. In 1982-83 that conservative coalition Government destroyed the labour market resulting in a massive 150,000 children being added to the numbers of pensioner and beneficiary families. So over the seven years of the Opposition's period in office 410,000 children were added to the social security system. Their families were forced onto dependency on pension or benefit. While those numbers were escalating, the then Government slashed income support available for those children. In 1977 payments for children were 15.2 per cent of the married rate pension. By 1983 this figure had fallen to 11.1 per cent of the married rate pension and over that period the real value of the married rate pension had also fallen. Keeping in mind the reality of both the massive increase in numbers and the decline in the real value of additional payments for children, what is the Government's record in comparison? We inherited a situation where in 1983 781,800 children were dependent on social security. We have reduced that number. In February this year 779,100 children were dependent on pension or benefit. We have, of course, cut the number of children in pensioner and beneficiary families, although I concede by nowhere near the numbers that we would like to see. So although the level has remained roughly the same during the period that we have been in government there has been a decline in the last few month's. We have had to deal with those massive numbers and the costs that are involved in sustaining a social security budget of which such high proportions go into the support of pensioner and beneficiary families. Child payments in respect of the married rate pension have increased from 11.1 per cent in 1983 to 12 per cent in 1984, 12.6 per cent in 1985, 13 per cent in 1986 and 14.1 per cent in 1987 for children under 13 years of age and to 17.2 per cent for children aged 13, 14 and 15. So, in each year that we have been in government we have made some improvement in the level of payment despite the massive numbers of children in pensioner or beneficiary families. No matter how difficult the circumstances have been-we have had some extraordinarily difficult Budgets-we have maintained this priority. Of course, as honourable members will be aware, the Government has made a commitment to achieve, for the first time in the history of family assistance in this country, the benchmarks of 15 and 20 per cent of the married pension rate and then effectively to index those payments so as to maintain their real value. When we hear discussion about child poverty within this country, I think it is surprising that it is not conceded more often how radical a change it is in relation to any child payment to achieve a benchmark or a standard against which that payment should be made and then a commitment to maintain its real value. We have not had that from any government since child endowment was introduced in the 1940s. So it is a very substantial change and commitment. Mr Connolly —You did not index the family allowance. Mr HOWE —Family allowances were a reform arising out of tax changes made during our period of government. The rebate for children was cashed out by the Fraser Government. In one sense, it was a transfer across to the other side of the ledger. It ought to have been obvious in the seven years of conservative government rule that the level of assistance would diminish each year unless there was a commitment to indexation. The previous Government had seven years to face up to that problem. Indeed, the Opposition had the opportunity in the context of the election campaign in the middle of last year to do so, when it made a very substantial commitment in relation to family assistance. But there was no commitment to the indexation of the real level of the family assistance that was promised. That is simply one criticism. Notwithstanding the fact that the honourable member for Bradfield has criticised the Government for failing to address adequately the problem of child poverty, sole parents would have received no assistance out of that package unless they were in the work force. Even in that massive package, there was not a cent for the vast majority of sole parents who were out of the work force. I think it is really quite incredible that the Opposition should have come up with a package along those lines. I am suggesting that the Opposition's amendment is fundamentally based on untruths. It is based on a misrepresentation of non-facts. There is no factual basis to the statement that the number of children in pensioner and beneficiary families has increased during the period we have been in government. Quite the contrary, there has been a small decline in the number of children in pensioner and beneficiary families. But, in the case of unemployment beneficiaries, there has been a substantial decrease in the number of children in families in which there is no adult employed. I think it is important to restate some of the principal elements of the Government's policies and achievements in respect of sole parents. This is an area to which we, as a government, have given considerable attention and priority. I think it could be said that sole parents need three broad areas of assistance. Firstly, they need adequate income to support themselves and their children when they do not have work. In answer to some comments that were made recently by the honourable member for Sturt (Mr Wilson), I think it is important for the public and for the honourable member to recognise that most sole supporting parents receive a benefit for a very short time. The average length of time that a sole supporting parent receives a pension is less than three years. I wish we could get that across in public discussion. I think we should make some bipartisan effort to get across the fact that people tend to be on the supporting parent's benefit for a period of crisis and, on average, for not much longer. I know that there are exceptions to that. But there is a mythology in the community about sole parents which makes it extraordinarily difficult for governments to provide, for example, the adequacy that is necessary during a period of crisis. Sole supporting parents need adequate income to support themselves and their children when they do not have work. Secondly, sole parents need to have access to services to enable them to work. Most sole parents in the community are at the peak of their working lives. I think it is important to say that there is common ground between the Government and the Opposition for believing that the solution to, certainly, long term poverty for sole parents, or for parents who have been in poverty for long periods, is a more effective transition to work. Thirdly, there is a need for assistance to those sole parents who have not been employed for a long period and who need confidence and skills to obtain employment. In my view the record of this Government in all three areas is a proud and significant one. We have increased payments to younger children from $10 a week to $22 a week and to $28 a week for children aged 13, 14 and 15. Of course, the Government has increased Austudy payments for 16- and 17-year-olds from I think less than $20 a week to more than $50 a week. We have increased the mother's/guardian's allowance from $6 a week to $12 a week-a 100 per cent increase. This allowance has been extended to all sole parent pensioners and beneficiaries. The so-called poverty traps changes of last year have been of major assistance to sole parents. The amount that they can earn each week before they start losing their pension was significantly raised. The amount that a sole parent with three children could earn was increased from $48 a week to $76 a week-a 58 per cent increase. The earnings credited introduced in the last Budget means that sole parents who are just starting work or who do casual work will be able to keep much of their pension. We have dramatically expanded the availability of child care places and have targeted those places so that sole parents are major users of the child care program. We have made sole parents a priority group for the Commonwealth Employment Service and labour market programs. Sole parents are becoming major users of a range of labour market transition programs. When one compares the Government's approach with the Opposition's position, the differences are indeed stark. The Opposition would decimate labour market programs, destroy the child-care program, shed its public housing responsibilities and cancel the pensions of every sole parent whose youngest child is over 10. This Government is about helping sole parents to live a decent life and to participate in the mainstream of community activities. The Opposition is about taking away their pensions and leaving them alone, with no pension, without access to child-care, without secure housing and without the chance to get back into a job after years of looking after children. With the Australian Labor Party, sole parents have a chance of living a decent life as part of the Australian community. With the conservatives, here and in the States, the future for sole parents is very bleak. Let us consider the Opposition's apparent concern for the increasing number of sole-parent pensioners. As at June 1976 there were 137,900 sole-parent pensioners. After seven years of conservative rule, on 30 June 1983 there were 242,100 sole-parent pensioners. So over the seven years of government by the conservatives the number of sole-parent pensioners increased, on average, by 14,900 each year. Let us compare that with this Government's record. On 30 June 1983 there were 242,100 sole-parent pensioners. On 30 June 1987 there were 266,900 sole-parent pensioners. In that four years the average increase has been 11,200, compared with 14,900 under the conservatives. The very good news is that in the year from June 1986 to June 1987 the number of sole-parent pensioners fell. Just as we did with the unemployment benefit, firstly, we slowed the growth in numbers that occurred under the conservatives and now we are actually bringing them down. For the first time in history, in 1986-87 the number of sole-parent pensioners fell. I will repeat that: for the first time in history, in 1986-87 the number of sole-parent pensioners fell. That was not because of any change to age of the qualifying child. That decision had not been implemented on 30 June 1987. The reduction was because of the jobs which this Government has created, the strong support to ordinary Australian families provided by the Government, and our effective administration of the social security system. The honourable member for Bradfield, in a piece of sophistry rarely equalled in this House, complained that in the years 1980 to 1986 the proportion of unemployed people with children increased from 37 per cent to 46 per cent. He added that most of those years were years of Labor government. What he did not say was why this occurred. It occurred because of the savaging of the Australian labour market by the present Leader of the Opposition (Mr Howard) in 1982. The honourable member for Bradfield and the House should never forget that terrible year-our only year of negative growth since the Second World War, a year when 300,000 were thrown out of jobs and onto the scrap heap of the conservatives failed economic policies. Mr Connolly —And a record drought. Mr HOWE —A record drought. The facts are there. The social security system was literally breaking down under the weight of the numbers going onto the unemployment benefit. Mr DEPUTY SPEAKER —Order! The Minister's time has expired. Question put: That the words proposed to be omitted (Mr Connolly's amendment) stand part of the question. The House divided. (Mr Deputy Speaker-Hon. J. D. M. Dobie) Ayes . . . . . . . . . . . 66 Noes . . . . . . . . . . . 48 —— Majority . . . . . . . . . 18 —— Baldwin, P. J. Jakobsen, C. A.Beazley, K. C. Jenkins, H. A.Beddall, D. P. Johns, G. T.Bilney, G. N. Jones, BarryBlanchard, C. A. Kent, L.Bowen, Lionel Kerin, J. C.Brown, Robert Kerr, D. J. C.Brumby, J. M. Klugman, R. E.Campbell, G. Lamb, A. H. (Teller)Charlesworth, R. I. Langmore, J. V.Chynoweth, R. L. Lee, M. J.Cleeland, P. R. Lindsay, E. J.Courtice, B. W. McHugh, J.Crawford, M. C. Martin, S. P.Cross, M. D. Mildren, J. B.Cunningham, B. T. (Teller) Milton, P.Darling, E. E. Mountford, J. C.Dawkins, J. S. O'Keefe, N. P.Dubois, S. C. O'Neil, L. R. T.Duffy, M. J. Price. L. R. S.Duncan, P. Punch, G. F.Edwards, Ronald Saunderson, J.Fatin, W. F. Sandford, R. W.Free, R. V. Scholes, G. G. D.Gayler, J. Sciacca, C.Gear, G. Scott, J. L.Gorman, R. N. J. Simmons, D. W.Griffiths, A. G. Snow, J. H.Hand, G. L. Snowdon, W. E.Harvey, E. R. Staples, P. R.Holding, A. C. Theophanous, A. C.Howe, B. L. Tickner, R. E.Humphreys, B. C. West, S. J. Adermann, A. E. McArthur, F. S.Aldred, K. J. McGauran, P. J.Andrew, J. N. (Teller) Macphee, I. M.Beale, J. H. Miles, C. G.Blunt, C. W. Millar, P. C.Braithwaite, R. A. Moore, J. C.Burr, M. A. Nehl, G. B.Cameron, Donald Peacock, A. S.Cameron, Ewen Porter, J. R.Cameron, Ian Pratt, M. P.Carlton, J. J. Prosser, G. D.Connolly, D. M. Reith, P. K.Downer, A. J. G. Rocher, A. C,Edwards, Harry Shack, P. D.Fife, W. C. Sharp, J. R.Fischer, Tim Sinclair, I. McC.Fisher, Peter Smith, W. L.Goodluck, B. J. Spender, J. M.Halverson, R. G. Sullivan, K. J.Hawker, D. P. M. Tuckey, C. W.Hewson, J. R. Webster, A. P.Hicks, N. J. (Teller) White, P. N. D.Hunt, R, J. D. Wilson, I. B. C.Lloyd, B. Woods, R. L. McLeay, Leo Ruddock, P. M.Uren, T. Shipton, R. F.Hayden, W. G. Katter, R. C.Lavarch, M. H. Brown, N. A.Grace, E. L. Jull, D. F.Morris, Allan MacKellar, M. J. R.Morris, Peter Cowan, D. B.Hawke, R. J. L. Howard, J. W. Question so resolved in the affirmative. Amendment negatived. Original question resolved in the affirmative. Bill read a second time. Message from the Governor-General recommending appropriation announced. Leave granted for third reading to be moved forthwith. Motion (by Mr Howe) proposed: That the Bill be now read a third time. Mr CONNOLLY(Bradfield)(12.42) —I wish to take only a moment of the House. The Minister for Social Security (Mr Howe), in his comments when closing the second reading debate, referred to the growth of numbers of sole parents under the Fraser Government. It should be noted for the record that there was a significant growth. That took place as a result of the passage of the Family Law Act which was introduced during the period of the Whitlam Government. These simple facts ought to be remembered. It was not government policy then deliberately to increase the number of sole parents, but one of the obvious outcomes of the passage of the family law legislation was that divorces became easier to obtain. Consequently, there had to be a growth in the numbers of single parents. Mr HOWE(Batman-Minister for Social Security)(12.43) —in reply-I do not want to delay the House either but I must say that I concede that in some respects what I would describe as extreme inequity in the relative positions of non-custodial and custodial parents was an unanticipated and unintended consequence of changes to family law. What this Bill is about, along with the other pieces of legislation, is dealing with that massive inequity which has resulted in tremendous poverty amongst sole parents and particularly in the growth of a very large number of children who, by any stretch of the imagination, could be described as being in poverty. It is those realities and inequities and that scandal of child poverty that the Government is seeking to address. Question resolved in the affirmative. Bill read a third time. Sitting suspended from 12.44 to 2 p.m. Mr HAWKE(Wills-Prime Minister) —I inform the House that the Minister for Foreign Affairs and Trade, Mr Hayden, left Australia on 3 April on Government business overseas. He will return on 15 April. In his absence, the Minister for Trade Negotiations, Mr Duffy, will be the Acting Minister for Foreign Affairs and Trade. The Minister for Transport and Communications Support and Minister Assisting the Treasurer, Mr Peter Morris, left Australia yesterday to undertake official business overseas on behalf of the Treasurer. He will return on 19 April. The Minister for Transport and Communications, Senator Gareth Evans, will perform Mr Morris's duties in his absence, with the Minister for Employment and Education Services, Mr Duncan, representing him in this House. Finally, as a matter of courtesy, I inform the House also that the Minister for Industrial Relations, Mr Willis, will be absent from Question Time today on Government business. Questions normally addressed to Mr Willis should be directed to the Minister for Immigration, Local Government and Ethnic Affairs, Mr Holding. Mr HOWARD —My question is addressed to the Prime Minister and I refer him to the explicit promise given in his 1987 election policy speech: By 1990 no Australian child will be living in poverty. Does the Prime Minister still stand by that promise? Mr HAWKE —I thank the honourable gentleman for his question. I made it quite clear in the very considerable media work I did straight after the release of the policy speech that what I was conveying was the fact that as a result of the decision of the Government no Australian child need live in poverty by 1990. I made the obvious fact clear that no Australian government and no Australian Prime Minister could ensure a situation that, the money having been provided as a result of the most significant decision ever taken by any government in the history of this country to deal with this problem-and I shall come in a moment to the dimensions of what the Government has done-an individual parent with responsibility would not misuse that money. If this poor, pathetic collection on the Opposition side of the House gather some comfort from that fact, it is indeed a measure of the depths to which they have descended. I proceed to give the Leader of the Opposition and the House a reminder of the dimension of what has been done by the Government in this regard. It is this: A parent will receive at that level of low income units an amount of $22 a week tax free. The import of that may be adjudged by this simple statistic: If one takes a low income family unit of that type with a $320 a week income with three children, the $66 that family will receive tax free is equivalent to a wage increase of $93 a week. That is an indication of the dimension of the initiative undertaken by this Government, an initiative that will be improved upon between now and 1990. I repeat, therefore, that as a result of this historic and quite unparalleled initiative, which is infinitely beyond anything that would have ever occurred to the imaginations of Opposition members during the great period that they were in office-throughout which period the basic problem accumulated, by the massive growth in unemployment that flowed as a result of the coalition's policies-the fact is that by 1990 no Australian child need live in poverty. I say also that it would be my hope, and I trust a hope shared by the Leader of the Opposition, that the sense of responsibility on all parents who will be in receipt of this very generous allowance, that no child need live in poverty by 1990 will be mirrored by the fact that overwhelmingly that will be the case because those in receipt of this money will expend it properly. Dr THEOPHANOUS —My question is directed to the Minister for Immigration, Local Government and Ethnic Affairs. Will the Minister inform the House whether he has received any documents, and if so what documents, from the FitzGerald Committee to Advise on Australia's Immigration Policies? Will he further inform the House of the present state of that report? Mr HOLDING —I thank the honourable member for his question. Early last week I received from Dr FitzGerald, the Chairman of the Committee, a draft working copy of the report. At that time Dr FitzGerald made it clear that the final report would consist of three basic documents: the report itself and a list of recommendations, and two appendices. Those appendices would consist of reports commissioned by the Committee about areas relevant to a consideration of the immigration program and administration, some of which have been released already, and a model Bill which is designed to assist discussion concerning aspects of policy recommendations and which, although subject to rewriting, have previously been released in two workshops. Dr FitzGerald is currently out of Australia. He has indicated that he hopes to be in a position to provide me with all documentation relevant to the report within a fortnight of his return. I would hope to be in a position to table the report towards the end of May. I should also like to take this opportunity to point out that it is clear from the working draft that the Committee has examined a wide range of issues. The significance of the report will be that it will provide a focus for an informed and rational debate on a range of issues that go to the formulation of an effective immigration policy. In this context I might add also that I think the Press release issued today from the office of the Leader of the Opposition, suggesting that the final report will not accurately reflect the submissions and consultations with the Committee, is to be regretted. Mr Howard —Why? Mr HOLDING —Because it can in no way be seen as a reflection of the work done by the Committee. It is regrettable that the Leader of the Opposition should choose to make such a statement on the basis of an inaccurate Press report. I suggest that had he consulted with his shadow Minister, he would have been much more accurately advised. Mr Peacock —He does not have to remain silent until you table the report. Mr HOLDING —I realise that shadow Ministers are under some constraints; they have all got gags on them. The comment made by the Leader of the Opposition is not only irresponsible, but if it reflects on anyone, it reflects on himself, because he was basically more concerned to try to make a political point than to discharge what ought to be his responsibility on behalf of the Opposition-to see that there is in fact a mature, informed and responsible position formulated by the Opposition on this matter. There seems also to be a view, expressed in various sections of the media, that the recommendations of the Committee will automatically form the basis of Government policy. Of course, that is not the case. It is the responsibility of the Government to formulate policy. This report will have no more and no less status than other reports that are designed to assist in the formulation of policy after proper evaluation by the Parliament and the community on the issues that they address. Mr SINCLAIR —I refer the Prime Minister to his previous answer to the question asked by my colleague the Leader of the Opposition. In view of the Prime Minister's rejection of the clear wording of the undertaking he gave to the Australian people in his policy speech, and I quote-- Government members interjecting- Mr SINCLAIR —Are Government members saying that the Prime Minister did not say it? I shall quote his words: By 1990 no Australian child-- Mr Hawke interjecting-- Mr SINCLAIR —Never mind, little boy. I should think that that just about behoves you. He said: By 1990 no Australian child will be living in poverty. I do not know whether the little boy across the table wants to grow up but he pretends now that he did not use the words in his policy speech. Did he deliberately mislead the Australian people? Is this an indication of his sloppiness? I will wait for the Treasurer to advise him. I know it is necessary as he does not have enough wit or wisdom to advise himself. Is this an indication of mere sloppiness in his use of the English language, a sloppiness that is now illustrative and reflective of his own behaviour in his Ministry? If not, why did he make that clear commitment to the Australian people which he now says could never be kept? Mr HAWKE —The Leader of the National Party, if I may put it this way, has been somewhat groomed for this question. We can understand his concern, as we can understand the concern of the honourable member for O'Connor, who has had a gag temporarily put around his mouth. What has the honourable member for O'Connor said to this Rambo of a leader? The Leader has said to him, `You can do what you like here in this House, Wilson. You can get in the gutter as much as you like here, but don't you dare talk about policy matters'. Why did he say that? The honourable member for O'Connor had said, `Look, John, I hold a safe seat, but the thing that worries me is Ian Sinclair's Party. It is quite clear on the question of a consumption tax. If you don't come to your senses on this, young John, we might be giving a seat back to the National Party'. Obviously, the Leader of the National Party is very unsettled at the moment after the Groom by-election. He is very unsettled because he has an unguided missile in the Senate who covets his position as Leader of the National Party. So in these circumstances it is not surprising that we are going to get a barrage of nonsense from the Leader of the National Party. The question is absurd. Its level is a reflection of the very agitated state of mind of the Leader of the National Party. I refer him to the answer I gave to the Leader of the Opposition. I repeat: it is quite clear that as a result of the decision we have taken there will be no need for any Australian child to live in poverty in 1990. If the Leader of the National Party believes in a situation in which a power is given to a government or a Prime Minister to intervene so directly in the lives of every individual in this country that it will determine how those individuals spend the money made available to them, he may be able to make some sort of an issue. I have no doubt that on this issue the Australian people will treat the Leader of the National Party with contempt, a contempt that is deserved, and that on this issue of substance they will congratulate and give credit to this Government for the substance of its decision. That decision is unique. It is unparalleled in this country. I repeat: as a result of that decision, no Australian child need live in poverty in 1990. Mr MILDREN —Has the Minister for Community Services and Health seen a report in today's Melbourne Age that the honourable member for O'Connor is proposing a $3 billion cut in Federal grants to the States for hospital and health services? Can the Minister advise the House of the reasons for the Government's payment of health grants to the States? Dr BLEWETT —Madam Speaker-- Mr Tuckey —I raise a point of order, Madam Speaker. I draw attention to your own request to Speaker Snedden on Ministers talking about Opposition policy when they know nothing about it. I believe the question is out of order. Madam SPEAKER —The question was not addressed to Opposition policy. Dr BLEWETT —It is true that it is difficult to know anything about the Opposition's health policies because they change from day to day. The first thing we might tell the honourable member for O'Connor, the first thing he needs to know, is that of the $3 billion that, according to today's Press, will be withdrawn from the public hospital systems in the States, approximately half is paid to the States for the care of pensioners in the public hospital system. There was no explanation of that. The remaining half is paid to keep down the cost to private patients in public hospitals and also to support disadvantaged patients. In the fantasy world in which the honourable member for O'Connor lives, apparently nobody will suffer from this. The Commonwealth will save $3 billion; it will not cost the States anything, we are told, but, of course, it is going to cost ordinary Australians because they are going to have to find that $3 billion. It will not be found, in the Medicare way, in an income-related way. It will be found by flat rate insurance, which is much tougher on the less well off than on the better off. That does not finish the element of unfairness in the proposals because we are also told that there will be risk rated insurance. The Opposition will get rid of the community rating principle and people will pay according to their risk. This Government has always supported community rating because we believe it spreads the burden of health costs fairly across the community. Let us take a couple of examples of risk rated insurance. Because women in their child-bearing years use medical and hospital services three to four times more than do younger women and somewhat older women, families would have to pay that massive increase to cover the risks of childbirth, so that proposal will impose on a family very much higher costs at a most vulnerable time. Again, it will clearly affect the old because a man of 64 makes three to four times the use of medical and hospital services a 20-year-old does. It will be a very heavy extra cost for elderly people. The Leader of the Opposition has running around the country a series of loose-lipped shadow Ministers making policy on the run. Let me give the House one further example of the loose-lipped nature of the honourable member for O'Connor. The honourable member for O'Connor told the Liberal Party council meeting the other day that people would have private insurance cards which, unlike the existing Medicare card, would not label them as poor. I have a Medicare card here. I have looked at it and I can see no labelling whatsoever which indicates that anyone is poor. This loose-lipped member for O'Connor-- Mr Tuckey —I raise a point of order, Madam Speaker. It does not label him poor. He gets the best doctor and the best room, just like Paul Keating. Madam SPEAKER —Order! The honourable member for O'Connor will resume his seat. I warn the honourable member for O'Connor. Mr Tuckey —He got his missus in the best room. He doesn't have to worry about it. He gets special treatment. Madam SPEAKER —Order! Is the honourable member for O'Connor aware that I warned him? I call the Minister. Dr BLEWETT —The loose-lipped member for O'Connor alleges that this card labels holders as poor. There is nothing on the card that does that. In fact, every Australian family in this country holds a Medicare card. The great advantage of Medicare is that as a universal system the card and its operation do not label people as poor; but under the proposal of the honourable member, in order to protect the poor and the pensioners from the very high charges to be imposed, they will have a card which identifies them as poor. We might call it the Tuckey poverty card. I suggest to the Leader of the Opposition that not only should he discipline the honourable member for O'Connor in relation to his loose lipped remarks about consumption tax, but he should also let him work out a health policy, rather than produce a series of loose lipped reactions around the country. Mr CONNOLLY —I direct my question to the Prime Minister. Is it a fact that 2.6 million Australians are living below the poverty line, and that 20 per cent of them are children? Is it also a fact that, even if the existing commitment to raise the family allowance supplement is met, there will still be some 400,000 children living below the poverty line in 1990? I ask whether this is the reason why the Prime Minister, after addressing the Child Poverty Conference in Melbourne last Saturday said, `How can I say at any time that no child will live in poverty?'. Mr HAWKE —The answer to the honourable member's question as to why I said that has been given twice in this House today. Ms FATIN —Has the Minister for Defence seen a statement by the shadow Minister for defence that nuclear-powered ships should be considered for the Royal Australian Navy? Has the Government plans to introduce nuclear-powered warships to the Royal Australian Navy? Mr BEAZLEY —Yes, I have seen a Press release to that effect. It states: Nuclear powered ships for the Royal Australian Navy is an option which must be examined. This will be the principal purpose of my visit to the United Kingdom and the United States in June of this year. I should have thought that any Opposition spokesman on defence or foreign affairs who had available to him at taxpayers' expense an overseas trip might have done something about looking, for example, at the regional relationships we are establishing in the defence area, for which we have been quite unjustifiably criticised by the Opposition. If the Opposition spokesman is going to the United States, he might take advantage of talking about the many serious issues that we discuss with the United States when we as Ministers for Defence and Foreign Affairs visit the United States. To produce a Press release to suggest that his principal priority in visiting there is to examine an option for nuclear powered warships for us is an indication of the irrelevancy into which the Opposition has descended. The shadow Minister might find out a few things if he does go to the United States. He will find out the very reasons why we do not have nuclear-powered warships in our own armed services. The nuclear-powered warships of the United States that the shadow Minister will see will be aircraft carriers of some 90,000 tonnes. Is it the intention of the Opposition to go for an aircraft carrier of 90,000 tonnes? Well, that would cost $A5 billion before one put an aircraft on it. So that will be an interesting option for him to consider, or will it be the Virginia class guided missile cruiser? That should be an interesting one for him to take a look at. He would be looking at about $A2 billion for a Virginia class cruiser. One thing he will find out if he talks to the people in the United States about the Virginia class cruiser is that that country is in fact moving away from nuclear powered options in that regard and is now constructing gas turbine cruisers to carry its new Aegis system, as witnessed by the Bunker Hill, which visited Australia recently. That is one ship that he could visit here and discuss without spending taxpayers' dollars to find out why the United States does not go down the road of nuclear powered ships. The fact that the shadow Minister is capable of saying that this is his priority in terms of his overseas visit is an indication of the extent to which the Opposition has no control over its front bench when it comes to the discussion of issues that cost funds. If the Opposition is talking about introducing into the Royal Australian Navy ships of the class that require for a single ship $2 billion to $5 billion worth of expenditure before one even hangs something useful on them, that is an indication perhaps of why it is considering a consumption tax. Such a tax will not be known as John Howard's food tax; it will have to be known as John Howard's battleship tax, if the shadow defence Minister is to have his way. Right across the board, whether it be the honourable member for O'Connor in regard to health policy, or whether it be the shadow spokesman for defence, the policy making of the Liberal Party is a complete and utter mess. It was once said, wittily, in this place that we had Tiberius on the telephone; what we now have is Claudius in a lift, stuttering his way up and down in Liberal Party meetings in Melbourne, trying to bring his front bench under control. It has to be said that he no longer has a front bench problem simply with regard to the consumption tax; he has a front bench problem in every single policy area. Mr TUCKEY —I address my question to the Minister for Community Services and Health. Is it a fact that as of the beginning of March this year the Health Insurance Commission instructed all of its offices and staff that no information relating to the affairs of any person can be released to any other person, and that as a result members of parliament making simple requests, such as when a constituent may receive a cheque, are being advised that the information cannot be provided? I ask the Minister: As this new policy is in direct contradiction to the advice provided to the Minister by the Health Insurance Commission on 7 January 1988, has the Health Insurance Commission advised him of its changed interpretation of the obligation of confidentiality contained in section 130 of the Health insurance Commission Act; and, if so, does the Minister still claim to be innocent of any breach of the Health Insurance Commission Act? Dr BLEWETT —The only point I wish to make in relation to the question raised is that, because of the abuse at one stage of the hotline procedures which the Health Insurance Commission had put in place in relation to requests from doctors so as to facilitate the operation of the Medicare scheme-and there was some evidence that that was abused- we have introduced in relation to that hotline system methods of checking that the demands are legitimate so that no forms of abuse can take place. That is probably what the honourable member is referring to. If there are any more extensive guidelines, I will look at them. But we were concerned by that particular abuse of a system which was designed to benefit and help doctors, and we wanted to ensure that only legitimate and bona fide requests came through that system. Mr MARTIN —My question is directed to the Minister for Primary Industries and Energy. Can the Minister inform the House of the Government's position on the Japanese coal settlements? Mr KERIN —We know what our position is, but it is pretty obvious that the Opposition does not. I read in the newspapers this morning that there is going to be another Opposition party. It will be a bit of a rush to see who goes to join Joh as Deputy, Senator Stone or the Leader of the National Party, given that they are such a good old team. It would appear that they are divided on this issue, as they are on tax. Before Easter I put out a Press statement on coal. I was very interested to learn that the Leader of the National Party and Dr Storey, a Liberal Party adviser, both put out statements backing the stand that the Government was taking. The Leader of the National Party is now reported as saying he did not put out a Press statement advocating intervention and a floor price approach. He is further reported as saying in the media that the Government should have got the producers together. That is the way he is criticising the Government now. Let us look at some of this. This Press release that was not supposed to be put out states: . . . the reported contract price of $2.90 a tonne was far too low. The price is $46.90, not $2.90-and this mistake is repeated twice. This is in the Press release he is now reported as saying he did not put out. It came out on Saturday, 3 April, from Bendemeer, in the Sinclair country seat. If he did not put it out, I guess the farmhand put it out on overtime, on Saturday-he is a very clever farmhand, and he deserves more money. He got it to Canberra, got it boxed down here, and got it included in the Opposition Leader's documentary summary for the week. That is not bad for a farmhand up there at Bendemeer. This is the one that the Leader of the National Party is supposed not to have put out. The second matter is that we have got to get the producers together and we have to intervene. The policy speech of the Leader of the National Party states that Commonwealth mineral export controls will go. That was their policy during the last election. I guess it is still their policy, although one cannot be sure. The Liberal Party policy at the same time was for the abolition of coal export controls. I do not know whether the Leader of the National Party of Australia is sticking to the claim that he put out this Press release or whether it was his farmhand who did so. However, it seems rather curious because he is now reported as saying that we have got to get the coal industry together although it is his Party's policy that there should be absolutely no coal export controls whatsoever. I am certain that Senator Parer would have that view as well. I simply do not know where the Opposition is on this whole question. Mr Tim Fischer —Now answer the question. Mr KERIN —Would the honourable member like to hear more about the Nationals, because they are really funny? Mr Sinclair —You can talk about me any day you like; I don't mind. Mr KERIN —I suggest that the Leader of the National Party make up his mind as to whether he put out this Press release or not. We have made our position very clear. We are deferring consideration of the settlements because basically all the settlements are not in. There are coal contracts for 14 million tonnes of hard coal, 14 million tonnes of semi-soft coking coal and three million tonnes of soft coal. We want the whole picture before us before we take any decision about this matter. Both the Prime Minister and I have made the Government's general views known on the whole situation. It is now said that basically Australia has a commodity based currency. Commodity prices certainly are affected very quickly. Of course, what the Opposition has never been prepared to understand throughout the last few years is that because we are getting the lowest price in real terms for our commodities since the Depression this has had an enormous impact on our currency. That is what caused the very large devaluation. In terms of some economic theories, when one has a devaluation or a depreciation of the currency one gets some great advantage in terms of the prices received for commodities. However, when we look at some of the prices we are receiving it is quite obvious that we have not got the benefits of the devaluation we have had. I guess that one way of demonstrating that is that in November 1982 we were getting about 17,000 yen for a tonne of coal. Today we are getting something less than 6,000 yen for a tonne of coal. I have been saying that it is not just currency adjustments of course but a question of what the world market is, what the profitability of the Japanese steel mills is and also what the competitive pressure is. Quite frankly the Japanese steel mills play very hard and tough. The Japanese people, in other commercial dealings, do not hesitate to discriminate against Australia, whether it be in beef, sugar or other areas. I think it is quite appropriate for us to say something. I could further enhance that by pointing out that Zenchu, the big Japanese cooperative, has put out a most offensive video on food imports and the beef situation. On the matter of coal, the Japanese steel mills beat their breasts and talk about commercial deals while on the other side of Tokyo Australia is being told that it will have to accept less money for the embassy site after a commercial tender process has been entered into. I am sure that my colleague the Minister for Administrative Services could have something to say about that. I believe that we need to stand up for our coal industry, say things firmly and deal with people firmly. We are not getting involved in commercial processes but that does not mean that we do not have an attitude. I do not believe that Japan will respect Australia if we adopt a craven attitude. We are quite firm. The Opposition is totally confused and does even know what it put out. Mr TUCKEY —In light of the previous very tentative and tremulous answer from the Minister for Community Services and Health I refer a question to the Attorney-General. I refer him to the Australian Federal Police inquiry into the release of confidential information by the Minister for Community Services and Health and the honourable member for Canning. Is the Attorney-General aware that the Federal Police completed its inquiries and forwarded its report to the Director of Public Prosecutions more than three weeks ago on 24 March 1988? Considering the seriousness of this matter, can the Attorney-General advise when the Director of Public Prosecutions proposes to make his recommendations; and, if not, will he advise the Parliament later this day? Mr LIONEL BOWEN —I am aware of what the honourable gentleman says. I was not aware that the report had been furnished at the time he said. I will be seeing the Director of Public Prosecutions at about 3.30 today, so I will let the honourable member know by 3.45 p.m. Mr WRIGHT —I direct my question to the Minister for Social Security and refer him to the bizarre claims by a former employee of the Department of Social Security, Peter Sawyer, relating to such things as an insidious national surveillance plot, the imminent demise of the world as we know it and other allegations that have unfortunately caused trauma and fear for many people, particularly the elderly. I ask: Has Mr Sawyer ever produced any evidence to back up his claims? Mr HOWE —I must say that the honourable member for Capricornia does not have it on his own in having to deal with Mr Sawyer. I am sure that the answer I will give to his question will be of interest to many honourable members on both sides of the House. Of course, I am aware of Mr Sawyer's activities. He has recently broadened the base of his scare campaigns from activities related to social security to just about every topic that comes his way. If I may say so, Mr Sawyer is something of a snake oil salesman. He travels about the country offering up his version of the ills of Australia, peddling claims of political conspiracy, world government, takeover plots, hidden bunkers, the demise of hard currency, with nothing but his own soapbox to support these bizarre notions. He began his campaign by claiming that the Department of Social Security computer facilities at Deakin in Canberra were being used as some sort of base for a de facto national identity system to be used as part of a grand government takeover plot. I have previously outlined to the House the rather boring and mundane everyday purpose of the Deakin Computer Centre and have provided detailed information about the purpose and implementation of the Department's important Stratplan project. Several groups of members and senators have recently toured the Deakin Centre. To my knowledge none has been able to come up with anything to support Mr Sawyer's allegations of sinister goings-on and bumps in the night. Even the honourable member for O'Connor conceded after his tour that he found nothing necessarily sinister in the building, its contents or the people who work there. That, of course, has not deterred Mr Sawyer, despite the fact that he has continually urged people to look over the centre in order that they find out the truth for themselves. He has recently turned his fanciful mind to the overwhelming issue of automatic teller machines, asserting that the video cameras installed on some of these devices are part of the Deakin Centre plot to provide a video scan identity of almost every Australian. He no doubt subscribes to the Kit Kat conspiracy theory related to automatic telling machines-that these machines are operated by kindly little old women who sit inside them and respond to the demands of customers with either money or a chocolate bar, as the situation demands. Mr Sawyer, I am sure, is already conducting his own in-depth investigation into the complex issue of chocolate bars and automatic teller machines; but information from the Canberra Permanent Building Society indicates that these cameras have been installed on its machines in an effort to reduce the high incidence of vandalism. The cameras do not photograph every customer and have absolutely no connection with the Deakin Centre. It is about time that those who give credence to Mr Sawyer begin by demanding a few answers of him as he has been demanding them of others. Just where is the hard evidence of his hysterical claims, apart from those in his own mind? Where is the evidence that Australia, as he asserts, is on the verge of a takeover by revolutionary forces, with established social orders and systems about to be broken down by totalitarian forces? I think that all members of parliament have shared some concern about the activities of this person who does so much to spread this information. A resident of the country town of Narromine, west of Dubbo, told a newspaper: It is all getting out of hand. Ordinary country people who have many legitimate concerns are being whipped up into a frenzy of anxiety by some crackpot who is spreading misinformation, sheer fantasy and hysterical nonsense. The activities of Mr Sawyer have been of great concern to people on both sides of the House. From my investigations, he has certainly no credibility in those matters close to my responsibility or about which I have been able to carry out investigations. I hope that all members of the Parliament will dismiss his claims as being bizarre and lacking any truth and that the questioning that has been directed collectively in our direction will be turned back so that we get some answers from this person who is so lacking in credibility. Mr SHACK —I remind the Prime Minister of his stated opposition to the closed shop and denials by his relevant Ministers from time to time that the closed shop even exists in the Australian industrial environment. In the light of this is he aware that in a letter to the Press Gallery the acting national secretary of the Australian Labor Party asked journalists to ensure that they have proof of union membership available at the time of accreditation to the ALP national conference? That letter states in part: . . . all journalists, photographers, film and sound crews working at all ALP national conferences be required to be financial members of a relevant trade union, and that they be required to produce proof of union membership at the time of their accreditation at national conferences. Is this not an attempt to establish a closed shop? What action will the Prime Minister take to ensure that this disgraceful, intolerable enforcement of compulsory unionism and restriction of Press freedom is not proceeded with by the ALP or tolerated by his Government? Mr HAWKE —In anticipation of the event in June-the ALP National Conference-I would love to have a bet with the honourable member as to whether there will be any shortage of media coverage of that event. I am quite sure that there will be a total, perhaps overwhelming, coverage of that event. Therefore, part of that question is obviously a nonsense. There is no intent on our part to try to restrict coverage of our conference, as distinct from the charade at the Hyatt Hotel in Melbourne last weekend when the Liberals would have been well served to have kept the Press out. Unfortunately, no matter how successful they were in doing that they did not succeed in stopping the Federal President of the Liberal Party of Australia from talking to the Press. I have ascertained the sorts of things that the Federal President had to say about the Federal Parliamentary Leader of the Liberal Party. As a result of my own very keenly developed sense of what is right language and my understanding of the rules of this Parliament, I would not be able to say in this place what the Federal President of the Liberal Party said about the Party's Parliamentary Leader. The language was disgusting. Opposition members interjecting- Mr HAWKE —I am serious, it was disgusting. The Federal President used words that would never pass my lips. I could never have said about some of my colleagues-even when I felt very deeply about the rare occasions on which they had differed from me-the words that John Elliott used about John Howard. If Opposition members seriously wish to talk about restricting Press coverage, they should make sure that the Federal President of the Liberal Party is barred from talking to the media because these things get out. I can assure honourable members that if such things were ever printed they would make their ears burn. In regard to our Federal conference, we regarded it as appropriate to respond positively to suggestions that were made to us by representative organisations of the media that if a proper, professional job were to be done by the photographers and the journalists, then those attending the conference should be accredited by their organisations. In this respect I know that it would be very difficult for the Leader of the National Party of Australia, the honourable member for North Sydney, and all other honourable members on the Opposition side with legal training to attach any weight to this question because they know that in regard to their own profession-the legal profession-they are members of the tightest closed shop in Australia. Mr ROBERT BROWN —My question, which is directed to the Treasurer, is prompted by the clear and widespread concern in the community about the possibility of a broad-based consumption tax and the clear indication that the Opposition intends to introduce a tax of that kind. Is the Government giving consideration to a tax of that kind? Is there any intention on the Government's part to introduce a broad-based consumption tax, and what could be the implications of such a tax? Mr Tim Fischer —Madam Speaker, I rise on a point of order. I draw your attention to standing order 144 which states: Questions should not ask Ministers- (b) to announce the Government's policy, The question of the honourable member for Charlton is clearly asking for Government policy on the matter of a consumption tax. Madam SPEAKER —It is not asking for policy. Mr Donald Cameron —You are trying to direct attention away from your-- Madam SPEAKER —Order! The honourable member for Moreton has had a couple of goes. I suggest he stop now. Mr KEATING —The answer is no on both counts. As honourable members will recall, at the National Taxation Summit in 1985 the Government proposed a consumption tax to deal with that part of the economy which was not being fully taxed. As a result of those deliberations the Government proceeded with other measures which are now yielding much more than the consumption tax was ever designed to yield. The result is that with the introduction of a fringe benefits tax (FBT), the abolition of entertainment as a deduction, substantiation, capital gains tax, other changes and increased Australian Tax Office action, between $2.5 billion and $2.75 billion has been raised in a discretionary way by the Government as a result of those discretionary changes. This far exceeds the $1.5 billion which was then designed to come from a consumption tax. At the time the Government adjudged that, given the fact that we were in the context of a large depreciation of the Australian dollar, the attendant wage changes to mute inflationary effects of the consumption tax could not be lived with. Having changed and broadened the direct tax base, having made it fairer and much more decent and having passed those changes back in the largest tax cuts in our history by reducing those marginal rates of tax and introducing a full imputation system for business, we now have a debate from the Liberal side of politics-after all their opportunities in public office-about a consumption tax proposal from the Chairman and Federal President of the Liberal Party of Australia, Mr Elliott. Mr Elliott has a great wish list of changes which he says would be funded by a consumption tax. First on the list, he says, are company tax cuts. Apparently the logic of the argument is that higher food prices for households should finance reductions in the company tax rate, but these reductions would be expensive. He then went on to suggest that a consumption tax could take place of the current alcohol excises. In other words, existing nominal ad valorem rates of 100 per cent and 150 per cent, expressed as taxes on alcohol per litre, would, under a consumption tax, be subject to massive reductions in taxes for alcoholic beverages. One does not need three guesses to know whose companies that would help! One does not need many guesses to understand the massive cost of such reductions. Mr Elliott then went on to say that the consumption tax would also fund the removal of the wholesale sales tax system. A consumption tax of 6.5 per cent to 7 per cent would be required simply to neutralise that which is lost by the wholesale sales tax. So to do any of these other things that Mr Elliott has in mind would imply a consumption tax of between 10 per cent and 15 per cent. After that, he also suggested that such a tax could fund the removal of the capital gains tax, the fringe benefits tax and the changes that this Government has introduced, which, as I said, are worth $2.5 billion to $2.75 billion. On top of that, he says it will fund massive reductions in personal tax rates. This is the original Liberal Party magic pudding. It will fund company tax cuts; it will cut the current alcohol excises; it will cut and replace the wholesale sales tax system; it will provide massive personal tax cuts, it will pay for the abolition of the capital gains tax, the fringe benefits tax and the return of the deductibility of entertainment expenses. All the rorts would be back and it would have to pay for that lost revenue. It will do all this but still find that the pudding is intact. The Opposition will take all this out but says that there will still be money there for tax cuts. That is, of course, patent nonsense. The Liberal Party thinks that there is some bottomless pit of funds. In fact, much of the area which has been taxed and which would have been subject to the consumption tax back in 1985 has now been taxed by the Government in an alternative way-with FBT, entertainment, substantiation, capital gains, et cetera. Much of this part of the indirect economy has been taxed, but nevertheless this approach is still touted. The Liberal Party President insisted that this matter go on the agenda. Then he dragged the Leader of the Federal parliamentary Liberal Party to a public meeting-as the Prime Minister remarked, meetings of this sort are not public meetings-to ram a consumption tax down his throat to put on the agenda of the Federal parliamentary Liberal Party. We know what has happened inside the Liberal Party. The power has passed from Mr Howard to Mr Elliott. We heard about the meetings. We heard about all the business representatives milling around Mr Elliott as though he was some sort of ageing political rock star, with Mr Howard apparently by himself on the other side of the room, full of nervous energy and trembling, wondering whether he was going to be able to keep his act together over the weekend. Of course, providence struck. The Liberals beat the National Party in Groom. Mr Beale —And the Labor Party too. Mr KEATING —As the honourable member knows, we lost nothing out of it. If the Liberals could not beat the National Party in view of the Fitzgerald Commission of Inquiry into Possible Illegal Activities and Associated Police Misconduct, they will never beat it. The National Party is so much on the nose in Queensland that the Liberals could have beaten it staying home in bed. In view of the fact that Mr McVeigh has been given a government job, and we know how that has been treated electorally lately, is it any wonder the Liberals won? It is an ill wind that blows no good. The Federal President, who is now the power in the Liberal Party, is not prepared to go into the Parliament and take his proper place as the Leader of the Federal parliamentary Liberal Party. We have the shadow Treasurer afraid of power and unable to strike down the honourable member for Bennelong. So it is a case of the living dead. The honourable member for Bennelong has taken the lightning strikes of the July 1987 election. He has taken all the opprobrium of his failure to perform up to last Christmas. By any reckoning in Australian politics, he should have been replaced on two or three occasions, but he is still there. It is like live political art-the sorts of things one sees in art galleries. It is only because of the wink that we know it is a person. I described the Leader of the Opposition the other day in political terms as a political carcass. I am saying to Mr Elliott: cut him down and let us get back to a proper basis of politics, where the real power of the Liberal Party faces us in the Parliament. Let the Opposition get its policy out. If it wants to put a tax on food and a tax on kids' clothes to fund company tax cuts and to put the rorts back into the system, let the mouthpiece who is advertising that policy come in here and defend it in the Parliament instead of doing it at some Liberal Party council meeting, sharing power with a political neuter who cannot win an election and cannot face the public issues in this country. Mr BEAZLEY(Swan-Leader of the House) —Papers are tabled as listed in the schedule circulated to honourable members earlier today. Details of the papers will be recorded in Hansard and the Votes and Proceedings. The schedule read as follows- Australian Capital Territory Radiation Council-Annual Report 1986-87-sub-section 74 (2) of the Australian Capital Territory Radiation Ordinance 1983. Fresh Fruit and Fruit Products Industries-Industries Assistance Commission Report No. 410-24 February 1988. Operation of the Fishing Industry Act 1956-Annual Report 1986-87-section 8 of the Fishing Industry Act 1956. Royal Australian Air Force Veterans' Residences Trust-Annual Report 1986-87-including the Auditor-General's Report-sections 10 and 10a of the Royal Australian Air Force Veterans' Residences Act 1953 and section 63m of the Audit Act 1901. Honey Research Council-Annual Report 1986-87-sub-section 30 (5) of the Rural Industries Research Act 1985. Pig Research Council-Annual Report 1986-87-sub-section 30 (5) of the rural Industries Research Act 1985. Oilseeds Research Council-Annual Report 1986-87-sub-section 30 (5) of the Rural Industries Research Act 1985. Fishing Industry Research Committee-Annual Report 1986-87-section 19 of the Fishing Industry Research Act 1969. Australian Safeguards Office-Annual Report 1986-87. Mackay/Capricorn Section Zoning Plan-section 33 of the Great Barrier Reef Marine Park Act 1975. Norfolk Island-Annual Report 1986-87. Australian Council for Employment and Training-Report on Activities-November 1986-June 1987. Research Councils' Selection Committee-Annual Report 1986-87-sub-section 30 (5) of the Rural Industries Research Act 1985. Report on Telecommunications (Interception) Act 1979-section 31 of the Telecommunications (Interception) Act 1979. Law Reform Commission-Annual Report 1986-87-including the Auditor-General's Report-section 35 of the Law Reform Commission Act 1973 and section 63m of the Audit Act 1901. Fourteenth International Trade Law Conference-Canberra, 16 October 1987-Report. Wheat Research Council-Annual Report 1986-87-sub-section 30 (5) of the Rural Industries Research Act 1985. Australian Institute of Aboriginal Studies-Annual Report 1986-87-including the Auditor-General's Report-section 30 of the Australian Institute of Aboriginal Studies Act 1964. Australian Special Rural Research Council-Annual Report 1986-87-sub-section 30 (5) of the Rural Industries Research Act 1985. Australian Industry and Technology Council-Annual Summary of Proceedings 1986-87. Occupiers' Liability-Law Reform Commission Report No. 42-section 37 of the Law Reform Commission Act 1973. Motion (by Mr Beazley) proposed: That the House take note of the paper. Debate (on motion by Mr Fife) adjourned. Motion (by Mr Beazley) proposed: That the House take note of the paper. Debate (on motion by Mr Fife) adjourned. Motion (by Mr Beazley) proposed: That the House take note of the paper. Debate (on motion by Mr Fife) adjourned. Motion (by Mr Beazley) proposed: That the House take note of the paper. Debate (on motion by Mr Fife) adjourned. Mr WEST(Cunningham-Minister for Administrative Services) —by leave-Over the past nine years, successive Ministers have had the responsibility of reporting to honourable members on progress with the new Parliament House. The achievements over that period can now be marked by what will probably be the last such report to be presented within the confines of the building that has served this nation for 61 years as the home of its national parliament. The new building, as all honourable members can see for themselves, a few short weeks from its official opening by Her Majesty is virtually complete. As I informed the Parliament last October, it will be ready for its formal opening on 9 May and to commence operations in August. I will now provide a budget update for the three months period from September to November last year. The revised building budget for the three months to November 1987 now stands at $897.46m, with another $158.85m for the non-building items budget. This includes a transfer of $11m from the non-building items budget to the building budget. The total project budget is therefore increased from $1,047.8m at August 1987 prices to $1,056.31m at November 1987 prices. This updating includes $4.68m for the effects of inflation in the three-months period. There are some additional components to cover costs outside the control of the Parliament House Construction Authority. The first has been an allowance of $2.41m for the cost of industrial disputes. If I could just digress to give a breakdown which may be of some assistance to the House: the cost of the quarter's industrial disputes can, in the main, be attributed to a demarcation dispute between the furnishing trades and the Transport Workers Union of Australia in October; a series of stoppages in each month involving the Building Workers Industrial Union of Australia and the Federated Engine Drivers and Firemen's Association of Australia; and a plumbers strike in September. The costs respectively in breakdown order were $540,000, $800,000 and $270,000. There is a cost of $1.42m for reinstatement of previously deleted works, including two Ministers' suites and the area to house the Australian Protective Services in the southern area of the building. There is still a need to provide for a revised layout to the ministerial media group area for the third additional Minister's suite. After discussion between myself and the Parliament House Construction Authority, the Authority has decided to reject all tenders for this work as being far too high. Subject to agreement by the Joint Standing Committee on the New Parliament House, a revised layout will be achieved by effecting minimal changes to the ministerial media group area at less than 50 per cent of the lowest tenderer's price. I again digress to give some late information sought by the Opposition regarding the cost of the decision not to use rainforest timber in the building after last August. I was informed today that to date the cost of this decision is $647,933. We estimate that the final cost may reach $700,000. The cost includes the settlement of some claims from timber suppliers and furniture manufacturers and the additional cost of replacement timbers. However, and I ask the House to take note of this, the amounts do not take into account the underlying additional costs the Authority would have incurred due to the delays imposed on it by timber suppliers had the decision not been taken. That is, we will never know what the cost would have been had we not taken the decision, particularly if the north Queensland suppliers had continued to boycott supply to the manufacturers. Two points can be made: the indicative cost so far of $700,000 is nowhere near the $15m that some Press reports have implied. Secondly, it has to be spotted off against an unknown quantitative cost as to what the cost may have been had we continued to allow ourselves to be stood over by suppliers who would not supply the timber. I look forward confidently, and with some pride, to presenting our next progress report from our new and permanent Parliament House. Mr PORTER(Barker) —by leave-I am sure that the House welcomes the advice of the Minister for Administrative Services (Mr West) that the new Parliament House is progressing on schedule and will be ready for the official opening on 9 May and the subsequent commencement of operations in August. However, our approval of the content of the Minister's statement ends at that point. When the budget for the new Parliament House was first drawn up, it included $220m for construction and $82m for non-building items, a total of $302m. The Minister now advises us that the cost of the new Parliament House is set at $1,056m, an increase in excess of 350 per cent over the original estimate. Despite the fact that the construction phase is almost complete and the Government is now concluding the fit out, the blow-out in cost continues. One of the most disturbing reasons for the blow-out is the cost of the continuing and high level of industrial disputes. It is a sad reflection on the pathetic state of this nation under Labor that this Government is willing to sit back and report calmly that the cost to the taxpayer of the industrial disputes, industrial blackmail, strikes and disruption which have occurred on just one government building site over the last six months is over a quarter of a million dollars a week. Remember that the building is almost completed and the Government is still paying a quarter of a million dollars a week to satisfy the unions which continue to brawl among themselves. Today the Minister expressed not a word of regret that this has continued to occur. The bland acceptance of this totally unacceptably high level of industrial disputes is just another example of how this Government has lost touch with the people. The Australian community is no longer prepared to tolerate this industrial lawlessness. The Australian taxpayer should not be called on to pay the costs of irresponsible union action fostered by this Government's weak compliance. Whilst the Prime Minister (Mr Hawke) and his Ministers continue to cling to the existing outdated, outmoded industrial relations system, the nation will continue to suffer through higher taxes, lower production and a lower standard of living. The Minister's statement also reveals the chaotic state of this Government's administration. In an earlier forlorn attempt to control the cost blow-out, the Government deleted some of the works that were planned originally for the new Parliament House. Now, as the time comes to use the building, the Government has put those works back on the program at, of course, an increased cost to the taxpayer. In a costly change of mind, this Government has reversed its earlier decisions. As we know, the Government has seen fit to match the massive growth in the size of the Public Service in the last five years with an increase in the size of the Ministry. Not only are we told by the Minister that we have to pay the extra salaries for the extra Ministers whom the Prime Minister has seen fit to appoint but also we are up for $1.42m in new office accommodation for those extra Ministers. This is another example of the Government thumbing its nose at the public. It has no qualms about spending taxpayers' money. It is interesting that the Opposition on a recent visit to the new Parliament House discovered that the room set aside for shadow Cabinet meetings is about half the size required. That highlights a regrettable lack of consultation in planning of the building. Mr Peter Fisher —We won't be using it for long. Mr PORTER —A request to remove a wall to increase the size of the room has been rejected. We on this side of the House are glad that it will be only a very temporary problem for us because, as the honourable member for Mallee has just said, we will soon be on the other side of the House and the problem will have to be borne by those opposite. They will have to put up with their own stupidity. Finally, I raise the issue of the use of this building after we make the move up the hill. I raised the matter in the House with the Minister a month or so ago and have still to receive a response from him. As I understand it, the Government has set up an interdepartmental committee to consider the future use of these premises when we move up the hill. No information has been given to the House or the public as to the future use of these buildings. I again ask: When will the Government put a proposition to the House in relation to these buildings? It is a matter of great public interest. Not only is the public interested in the opening of the new Parliament House and in seeing the new Parliament House but also people want to know what will happen to this building which has served us so well for so many years. Mr DEPUTY SPEAKER(Mr Mountford) —Madam Speaker has received a letter from the honourable member for Richmond (Mr Blunt) proposing that a definite matter of public importance be submitted to the House for discussion, namely: The uncertainty, insecurity and fear among members of the aged community and their families arising from the Government's approach to aged care. 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 BLUNT(Richmond)(3.09) —Today we are to debate a matter that affects a large number of Australians, their families and the people who care for them. Many groups in Australian society have been attacked by the Hawke Labor Government since it came to office in March 1983. I guess no group has been attacked more than the aged in Australia. The Australian Labor Party began its first few months in office with a super tax and an assets test. Then it broke a promise to increase the pension to 25 per cent of average weekly earnings; delayed consumer price index adjustments to the pension; perpetuated poverty traps; introduced tougher assets tests and cut back on veterans' entitlements. It has done about all it can do in that area and now it is directing its attention to the frail aged in our society. Many people would think that this is not a significant issue because not too many people want to address the problems of the frail aged. We, as a society, tend to want to avoid unpleasant images and many of our nursing homes for the aged are not in the mainstream of our community. Let me tell honourable members that there are around 70,000 residents of nursing homes in Australia. They have families and staff who care for them. The issue we are debating today is real; it is not a statistical issue or something that an academic economist within the Department of Community Services and Health could debate in terms of working papers. We are talking about people who suffer, who are scared about their future. We are talking about families whose means are not sufficient to cope with additional financial burdens and are very concerned about the Government's intentions in this area. There is general agreement about the direction of the Government's policy. We on this side of the House agree that there is a need for diversity in aged care. We recognise that it is desirable to allow people to choose the most appropriate and adequate type of care available to them. That, of course, includes intensive care in nursing homes, hostel care for those people with greater capacities and facilities and home nursing for those people who are still able to look after themselves, either in their own homes or in the homes of their families. But that is just about as far as the agreement with the Government goes. It is not just the Opposition which objects to the implementation of the Government's policy; it is the entire nursing home aged care industry-without exception. Later I will make reference to the views of the industry. It is not just the private operators, the people who operate at a profit, who are objecting to the Government's proposals; it is not just the voluntary or charitable operators who are objecting; it is not an objection from South Australia, Victoria or one other State; it is a universal opposition to the Government's proposed implementation of its policy. The opposition is based on the way the Government is going about implementing this policy, which is autocratic, remote and theoretical. There has been totally inadequate consultation with people with immense practical experience in aged care in Australia. So that the Parliament will understand exactly what I am saying I will quote from the 20-odd page submission made by the Australian Affiliation of Voluntary Care Associations. It is not a submission from a private nursing home and not from the Private Hospitals and Nursing Homes Association of Australia but from the association that represents the voluntary care providers in the society-the charities and the churches. They are not profit motivated; they are motivated by concern for their fellow human beings. They are concerned at the impact the Government's policies will have on the frail aged in Australian society and the flow-on impact on those who care for them, on their families and on society in general. It is a striking condemnation of this Government, that claims it is caring and concerned about the status of Australians, when we find that charities are saying that the Government is out of touch and does not know what it is talking about. The President of the Voluntary Care Associations, in writing to the Minister for Housing and Aged Care (Mr Staples), in terms of the consultation and lack of consultation, said: Some of the documents, and especially some of vital concern to the industry, were not distributed until the persons were present at the meeting. The Government did not want people to read what was in those documents because they might have understood what was going on. He also said: Sufficient time was not allowed for the reading of the documents- when they were tabled at the meeting- The State consultations were more a matter of sharing information and gaining initial reactions from those present- than seeking a considered position- There has been little time allowed for the industry to consult among its members . . . before responding to a very complex working party document on this very significant issue. It is no wonder that the industry is concerned because the Government has politicised the issue of aged care, almost from the day it was elected. In fact, last year in the Victorian newspapers, when this issue first arose as a major community concern the Government, with taxpayers' money, started placing advertisements. The text of these advertisements is an absolute disgrace. It is stated: The nursing home scandal is over! A fair deal for nursing home residents. Some greedy nursing home operators claim recent government changes . . . The greedy nursing home operators are the churches and charities. Everybody agrees that the Government's policy is off the rails. Yet it has the nerve to use taxpayers' money to place a blatant political advertisement in a newspaper, to take advantage of its political circumstances. It is a wonder that the advertisement does not contain a photograph of a Minister smiling, as the right wing machine of the Australian Labor Party in New South Wales perfected the technique. The issue is very complex. The whole question of nursing home financing is most complex. But what it really comes down to is that the Government has taken a decision, which it has not yet announced but has foreshadowed in working paper documents to the industry, that it proposes to limit the number of staff care hours per patient in nursing homes throughout Australia. It will have a uniform standard. The Government apparently is moving towards a standard of 17.1 hours per patient in the most critical case; for the most frail aged patient in nursing homes. The industry, with immense practical experience, has said that a minimum standard is 27 hours. That is the basis of the dispute. The Government says 17 hours and the industry says 27 hours. I am simplifying the debate deliberately because we have only 15 minutes. Mr Staples —You certainly are simplifying it. Mr BLUNT —The Minister says that I am. I challenge the Minister to have an open debate and let us debate this issue for half a day because that is the kind of debate we really need on this very significant issue. There is the related issue of the assessment teams. The Minister has run around this country saying-and it is to his disgrace that he would make such a statement-that an overwhelming majority of nursing home patients are getting inadequate or inappropriate care. So we have trial assessment teams running around the community. The industry thinks that those assessment teams are running a gate-keeping operation to limit the number of people who can get into nursing homes, irrespective of their need. There is immense concern in the industry about the adequacy of the assessment basis, the instrument by which people will be assessed and by which it will be determined whether they need the intensive care of a nursing home, whether they can cope within a hostel or perhaps whether home nursing is the right way to go for them. The very basis of that assessment is in dispute by the people who are responsible for caring for these frail aged in our community. Yet the Government persists with its approach-no consultation. It is an autocratic approach. Many people do not really understand what this will mean. It will mean a return to totally inadequate standards of care-according to the industry-for the frail aged. The industry has said that this will be akin to custodial care rather than caring care, a return to the standards of the nineteenth century. The Voluntary Care Associations, in a submission on behalf of the entire industry, including the Nursing Homes and Private Hospitals Association of Australia, has started to quantify what these changes will mean. They will mean restrictions on the capacity of nursing homes to feed patients. There will be production line feeding and if people do not get adequate feeding in the time available that will be too bad and they will have to find some other way to be fed. There will be problems with continence. That is a very delicate subject. But the easiest way to cope with it, if one does not have time to look after the particular needs of a patient, is to use a catheter. I wonder whether the Minister has any understanding of what this means for people-not statistics-the frail aged people; the grandparents and parents of Australians on whom the Minister is implementing a policy which will cause considerable hardship. The industry indicates that the capacity to bathe patients will be reduced. We could have a situation where patients will be washed only every second day. I wonder what that will be like in the summer. Patients will be left in bed for longer periods and that will have a significant impact on their health. Does anyone really understand what that means? Have honourable members ever seen a bed sore? Has the Minister seen a bed sore? I invite him to look at them because we are talking about people. That is not a statistic; it is a real consequence of inadequate care in a nursing home. The opportunities to bring people out of nursing homes and give them social interaction will be reduced. The capacity to cope with patients who have physical and mental problems will be reduced and there will be a need for physical and chemical restraint. The Nursing Homes Association lists 18 problems which entail a reduction in the standard of care as a result of the Government's proposed changes. As I have said, there is concern in the industry that the assessment teams will be gatekeepers and will restrict the access of aged Australians to intensive care. The Government's figures indicate that the cost of these assessment teams will rise from $4m to $16m. The industry says that the standard of assessment is inadequate and inappropriate. It thinks that industrial disputes will arise because of the extreme pressures that will be applied to people responsible for caring for the aged in our society. We are really talking about a significant issue. The people who are concerned about it, and who are expressing that concern, are not, as the Government would have us believe, profit hungry entrepreneurs. They are dedicated nurses, directors of nursing, senior sisters, churches and charities. I have received a great deal of correspondence from virtually every nursing home around Australia expressing concern in practical terms about the way the Government is implementing a policy that, in principle, has considerable merit. The dispute is about the standard of care. There is one thing that the Government should do to try to receive industry support and to restore some credibility to its policy; that is, to actually prove its figures. A working party is out and about suggesting to the industry that certain things will happen. One way to go about it would be to conduct a practical trial. I have suggested this before and today, on behalf of the Opposition, I suggest it again. If the Government believes that its standard of staff care is appropriate, it should apply its policy to the government owned and government managed, nursing home in Canberra-it should apply CAM, or the care aggregate module-and prove to the industry that it works. The Government should prove it before 1 July. If that is possible, the industry will have no choice but to accept the Government's proposal before it is forced to implement it Australia-wide. However, if the Government is not willing to trial its figures, it should sit down with the industry and work through the figures again. At the outset I said that this was a major problem. It is indeed a major problem; it affects hundreds of thousands of Australians, not just the residents and their parents, children and grandchildren; it affects also the staff of nursing homes, who will have to try to cope with these new standards. We all know what the attitudes of nurses are; they will try to make do. Directors of nursing will cut corners and place extra stress on their staffs to try to comply with this Government edict. Of course, we will see a reduction in the standard of care. Australia, which has an enviable reputation throughout the world for looking after its aged, will have its reputation diminished. The problem will be compounded because anyone who has examined the demographics of the Australian population will realise that the number of aged in Australia is increasing rapidly, and for that reason we had better get aged care right, not only in financial terms but also in care terms. There is a need to ensure that the industry can work positively with the Government. There is a need to do away with the politicisation of this entire debate. When one is unable to win an argument on merit, there is no justification for getting into the polemics of the argument. One has to understand that people and not statistics are involved. If what the Government should like to do in financial terms will not work, maybe it should recast its Budget and rethink its spending priorities. Apparently at the moment the Government is rethinking its spending priorities. Aged care is one area where the Government should give urgent consideration to rethinking its spending priorities. The Government has immense damage to undo. As I have said, the way to go about undoing that damage is to conduct a trial to prove that the figures work. If the figures do not work, the Government should move to a standard that will work-a standard that the industry is capable of implementing. The last thing we want in this country is a return to custodial care for the frail aged and a return to the standards of the nineteenth century for those people in the Australian community who are not capable of looking after themselves without the support and assistance of government. Mr STAPLES(Jagajaga-Minister for Housing and Aged Care)(3.24) —I welcome this debate today. I am glad that the Opposition, through its shadow Minister, the honourable member for Richmond (Mr Blunt), has placed before us today its concern for `the uncertainty, insecurity and fear among members of the aged community and their families arising from the Government's approach to aged care'. I believe that the statements of the shadow Minister, from his own mouth and from his own papers, will return to haunt him. The shadow Minister has set out to terrorise the aged population of Australia. He has set out to terrorise their relatives and anyone else he can get to. He is picking up on a campaign that is being waged currently by some organisations. I shall not differentiate between them. Some people are out to protect their own interests, as well as-they may well be saying in other instances-protecting the interests of nursing home residents. The fact is that the present system is inequitable and does not really work. However, one should look back to the time when the Opposition was in government-back to 1981, two years before the Opposition was voted out of office. One should look also at the years before that time when the Opposition was in government. I draw to the attention of honourable members the Auditor-General's report on an efficiency audit of Commonwealth administration of nursing home programs. In his findings concerning management and planning the Auditor-General criticised the operations of the Government of that time-that is, the Opposition that now criticises this Government-because the existing systems of management control exhibited weaknesses that gave rise to a lack of economy and lack of consistency. The Auditor-General said also that planning was fragmented. He said that admission procedures were defective in terms of cost control and matching patients' needs with optimum care. He found also that approximately 20 per cent of nursing home patients could be more appropriately cared for in alternative accommodation, if available, at lower costs. With regard to standards, the Auditor-General found, basically, that the Commonwealth funded varying levels of nursing care because States had different nursing standards, and that the efficiency of inspection activities was hampered by the absence of comprehensive guidelines on standards of nursing home care. He found also that existing growth controls lacked the support that would be provided by integrated planning. Also, the fees control mechanism did not appear to be effective in terms of the objective of restricting fee increases to costs necessarily incurred. He found that costs of deficit financed homes were significantly greater than costs in privately operated nursing homes that were charging up to the standard fee. In relation to admission procedures, the Auditor-General suggested that multidisciplinary panels-what we call geriatric assessment teams-should be set up to review some or all applications for admission to nursing homes. He said that maximum standards for nursing hours should be established and joint inspections with the States promoted. He said also that there should be some control over the number of nursing home beds. What did the Opposition do when it was in government? Nothing. What did the Opposition care about people in nursing homes? Nothing. The shadow Minister threw at me across the table a photgraph of a person with a bed sore. I refer the shadow Minister back to the report of the Senate Select Committee on Private Hospitals and Nursing Homes tabled by Senator Giles and other reports that have been tabled in this Parliament. Had he visited nursing homes during those times, he would have witnessed the care that was not being given to people in nursing homes under his Government's administration. This matter of public importance is a sham. It is an absolute disgrace. The Opposition is terrorising people. Let us examine what the shadow Minister has been releasing in his media statements. He talks about uncertainty, insecurity and fear among members of the aged community. Who is creating that uncertainty, insecurity and fear? Let us examine his record in 1987 when the standard aggregate module-SAM-and infrastructure cost proposals were being put forward. In a Press release of 23 October 1987 he said that 60 per cent of Tasmanian nursing homes would go out of business, involving up to a third of that State's aged in care. Have 60 per cent of nursing homes in that State gone out of business? No. He said also that the Labor Government planned to restrict the staff to patient time ratio to around 14 hours a week. Wrong again. He said further that the Hawke Labor Government seemed intent on sending patients of nursing homes far away from their families. Who is causing the insecurity? Who is causing the uncertainty and the fear in this Parliament and in this country today? Again in his repetitious Press releases the shadow Minister has criticised the Government's plans. He has claimed that nursing homes with fewer than 30 beds would be forced to close and it would be impossible for voluntary organisations to provide respite care. He did not stop there. This year in Press statement after Press statement he has referred to nursing and personal care funding. These statements have caused uncertainty, insecurity and fear among the aged community and their families. The honourable member opposite is creating the concern. He is running around the country terrorising people by claiming, for instance, that patients will be washed less often, possibly only every second day. A heading in a Queensland newspaper reads `Plug might be pulled on daily wash for oldies-Blunt'. That is as blunt as it can be. The honourable member for Richmond says in a Press release on 23 March 1988 that nursing homes will be forced to leave patients in bed longer, use more chemical and physical restraints, cut communications with patients and families, implement production line feeding, and use non-individual continence maintenance. He says that some nursing home beds may close and residents will be forced to look for alternative accommodation. That is what he is saying. He is terrorising people in this community. In another Press release the next day, 24 March, he again terrorises the aged and their relatives with uncertainty, insecurity and fear. He says: When the Government first announced its latest aged care policy it said 25% of nursing homes residents would be moved to hostels. He further says: Now we are told 40% are to be moved. The assertions by the honourable member are beyond the pale. They are a symptom of the Opposition's tactics and of its lack of policies. Let us see what this Government has done in its time in office, compared with the record of the Opposition, for people in nursing homes, for people who have bed sores like the person in this photograph. The Opposition has been condemned by this Parliament and it has been condemned by reports. We are the ones bringing standards into the nursing home industry. When we came to government there was no comprehensive national planning system. The Government has introduced a national population based, statistically determined, planning structure for nursing homes and hostels. There was no response to the problems of the ethnic aged from the Opposition. This Government did respond and is bringing in ethnic specific beds. There was no response from the Opposition in its period of government to the Aboriginal aged. There was no response to the financially disadvantaged. Where were the upgrading grants? Where were the upgradings in nursing homes of fire, health and safety levels? What did the Opposition do in government? There were no upgrading grants. Under this Government there have been 477 projects to upgrade nursing homes. What about dementia? What about the people in the nursing homes and hostels who suffer from dementia? Where was the Opposition's dementia program? It did not have one. It needed one but it did not have one. Where was its program to assist the elderly confused? Where was its program for 100 per cent capital funding for the disadvantaged? It did not have one. Yet the Opposition comes into this House and accuses this Government of creating uncertainty, insecurity and fear. It has not got a leg to stand on. The current situation is that this Government has a policy which we are implementing. It is a reform strategy that we are taking gradually. It is a very difficult area. Our policy will ensure that aged people receive services that are best suited to their needs, that facilities are developed where they are needed, that care is of a high quality and that residents are allowed the maximum level of independence. In line with the needs of the aged population, which is growing very greatly-and the costs are growing greatly-this Government is addressing the concerns of the Auditor-General that were expressed back in 1981. They were concerns that the Opposition failed to address. This Government is addressing those concerns in terms of hostels, in terms of the home and community care program and in terms of nursing homes. This Government is taking a very compassionate approach to the problems involved in aged care in Australia. We have needs based planning, assessment services, quality of care and quality of life outcome standards. Why did not the Opposition think of those things? What was it doing during that time? Why was it not responding to the problems facing people in their outcome standards? The funding system that the Opposition administered was an absolute mess. What about the special services programs? What about the cost to pensioners? What about the people in nursing homes who have to pay? What happens about them? The Opposition wants them to pay more and more without giving them the security of standards-standards which will be scrutinised-and affordable accommodation. The Opposition does not care about those things. The present system is inequitable and we are fixing it up. The honourable member for Richmond talked about an advertisement from the Department of Community Services and Health. That advertisement was in response to one that appeared a couple of days before that from industry associations that said people would be thrown out. The honourable member was the one who was scaring people as he is trying to do today. People have not been thrown out. The reality is that Opposition members are the ones scaring people. They are terrorising people. The honourable member for Richmond says he is concerned about consultation. The Opposition is concerned about consultation! There have been over 300 hours of consultation with major national industry bodies. There has also been extensive consultation on the issue of nursing and personal care. There was extensive consultation with unions, professional bodies and consumers. There have been several sets of lengthy consultations in every State and Territory. There have been over 60 rounds of meetings and that is what the Opposition will not tell anyone about. I ask the Opposition not just to take my word for it. Let me quote from the NSW Nursing Homes Chronicle. I will refer to the infrastructure issue. On 29 May 1987 the NSW Nursing Homes Chronicle stated: . . . the principal negotiators for government . . . have proven to be men of their word throughout the 12 months period and that during the entire time they have taken into account many points raised by us during the discussions, modifying their own proposals accordingly. That was last year. Let me talk about this year. The NSW Nursing Homes Chronicle, which is not a government publication, but an industry publication, stated on 11 March 1988: . . . we have at least had the good sense to recognise the willingness on the part of the Commonwealth bureaucracy to try to meet the need for communication as best as possible. It went on: . . . the goodwill that has been shown to us by the very top members of the Department's staff, and given their openness and willingness to talk as freely as they possibly can . . . Further it stated: Since the beginning of this year, from the very earliest days of January, there have been a considerable number of meetings at nursing and financial levels between the national negotiating team and the Commonwealth Department of Community Services and Health and there are further meetings to be held in Canberra next week at that level. It went on: . . . we have been most appreciative of the manner in which the very senior officers of the Department have handled their portfolio in respect to communication with this Association. That is part of the answer to the Opposition's claim. I have only two minutes left but I will go on. The fact of the matter is that the honourable member for Richmond was out there talking about the uncertainty, insecurity and fear among members of the aged community and their families arising from the Government's approach to aged care. Where is the Opposition's policy? Who will make its policy? Is it the loving and caring Senator Stone? Is it the warm, loving and caring Leader of the Opposition (Mr Howard)? How does this fit in with the Opposition's consumption tax policy? Where are the Opposition's policies on just about any matter in front of this Parliament? Where are its economic policies, its tax policies, its aged care policies? It does not have any. This Government has and we will ensure that the benefits of those policies flow to the residents of nursing homes, to every aged person in Australia, through the hostels program and through the home and community care program. The elderly people of Australia and their relatives will be secure in the knowledge that there are now outcome standards, that there is now scrutiny and that when these new arrangements are brought in there will be care according to need. By 1991 no person in a nursing home in Australia will have to pay more than 87 1/2 per cent of his or her pension plus rent assistance. That is the situation. This Government is committed to an aged care policy that works for the care and quality of life of those people in our ageing population. We are determined to make sure that future funding arrangements are directed to the areas of greatest need and that our aged people are treated in a dignified and caring way. Dr WOOLDRIDGE(Chisholm)(3.39) —In rising to speak on this matter of public importance on the concern of older members of the community about the changes that are taking place at the moment, I want to begin by talking about some facts as distinct from the 15 minutes of waffle we have just heard from the Minister for Housing and Aged Care (Mr Staples). He talked about funding. Yes, funds have gone up by 68 per cent in five years. However, the consumer price index increase for that period is 41 per cent and that takes funding down to an 18.4 per cent real increase. In addition over the past five years the population over 75 years of age has increased by 22.6 per cent. This means there has been overall a 3.4 per cent reduction per capita in funding for older people in this country. That is hardly care and compassion. Over the same period the per capita gross domestic product has increased by 14.6 per cent. That is what most Australians have shared in but not older people. Under this Government they have had a real per capita reduction in funding. Funding itself is not the whole story. It is not as important as outcomes. Particularly in the aged care industry, one must look at the outcomes of funding. The Victorian aged services peak council earlier this year received a report after 24 Victorian nursing homes were sampled. Some 60 per cent of people in those homes could not control their bowels or their bladders, yet only 20 per cent of them were being washed daily; that is, 40 per cent of people in those homes were not being washed though they were soiling themselves. If they were not being washed it was because staffing levels were inadequate, and staffing levels in every nursing home in that State were approved by the Minister's Department. Mr Macphee —In his electorate, too. Dr WOOLDRIDGE —In his electorate, too. If they are inadequate, it is because the Minister has failed to provide adequate staffing through the bureaucratic control he provides in nursing homes. The Minister said that people now have to pay because of the inadequacies of the previous Government. I looked through the Minister's Press releases, and I found a total of four newspaper articles. Yesterday's Age carried an article stating that Victorian nursing homes imposed a heavy burden on many residents by requiring them to pay money they could not afford. That is totally untrue. The Minister provides a subsidy and controls the fee the nursing homes charge and the difference is met by the patients. If a Victorian nursing home charges more than the Minister's approved fee, it is fined $10,000. Thus there are only three components: the Minister controls the fee, he controls the subsidy, and the patient has to make up the difference. In the five years that the Minister's Party has been in government, the fee of $418 has increased by $6. In spite of that, there has been an inflation rate of 41 per cent. So it is not the nursing homes that are forcing people to pay extra money. It is the Minister, his Department and his Government. The Government says that the present system often forces people into nursing homes when they need only minimal care. The Minister quoted from a 1981 report a figure of 20 per cent. That might have been so in 1981, but the Minister should update his figures. In 1981 the average age of admission to nursing homes in Victoria was 73. In 1987 it is 82. Today people in nursing homes have become on average much older and much more dependent. This has happened in a short time. Recently in the western health region of Melbourne every one of the 500 nursing home beds was sampled to see whether there was anyone in those homes who need not be there. Only one person was found, and one person out of 500 is not `often'. The development of the present patient classification system is an absolute scandal. It is true that the Minister did run a trial on 17,000 patients, but he then fitted those patients into five predetermined dependency categories-categories of 20 per cent, 20 per cent, 30 per cent, 20 per cent, and 10 per cent. The Minister did not consider the patients' needs; he put them into categories that had already been decided. The Voluntary Care Association has trialed this system in its nursing homes. It does not work. The Association has told the Minister so. One group of nursing homes partly within my electorate trialed the Minister's system to see how many of their patients, many of whom are highly dependent, they could put into category one, the highest dependency category. Out of 140 patients, they got three. A director of nursing at a church-run nursing home told me, `I can't make this system run unless I lie, and I'm not prepared to do that'. The Minister's system is unfair and inequitable. I shall give an example. An elderly person who is crouched in the foetal position, unable to do anything whatsoever for himself, on the proposed system would be classified category four, and that is a category of minimal care. Under the Minister's proposals, that person eventually will be moved out into a hostel. On consultation, the hours mentioned by the Minister sounded impressive. But one should look at what has happened. I talked to someone who had experience of one of the Minister's consultations. The person was at a meeting on 18 February attended by 100 people representing directors of nursing and some of the most important people in the nursing home industry in my State. Half of those people had not received the documents they were supposed to talk about and be consulted on at the meeting. That is not consultation; that is sheer incompetence. In Victoria, the Minister's State and mine, nursing homes will be hit hardest. Victoria has the lowest number of nursing homes per head of elderly population of any State in Australia. It has the highest number of dependency patients. Geriatric assessment teams have been operating for three years to make sure that only the most seriously afflicted people get into nursing homes. Under the Minister's arbitrary system, they are forced into predetermined classifications. I repeat: Victoria will be hit hardest. I had intended to reply to more of what the Minister said; but, really he said so little. It is a joke for him to talk about 1981. I was then still at university. This is 1988. The Minister spoke about scaring the population. The people are scared, but it is not members of the Opposition who are trying to scare the population. The Voluntary Care Association, the private geriatric hospitals, the Archbishop of Melbourne, the Moderator of the Uniting Church, and the head of the Australian Catholic Health Care Association are the ones issuing the Press statements. They are not trying to scare the population. They are committed people, trying to get a fair deal for the frail and elderly under their care. I find it hypocritical of the Minister to talk about members of the Opposition trying to scare the population after listening to the bunkum that came from the Minister for Community Services and Health (Dr Blewett) about a possible Opposition health policy and saying wildly inaccurate things-doing exactly the same thing, scaring people, as he is criticising members of the Opposition for supposedly doing. The Minister spoke about the dementia program and said that before Labor came to office there was no dementia program. Does the Minister know that the only nursing home in Australia that caters exclusively for demented people was set up in Kew, not far from his electorate, by the Fraser Government? Continued requests for similar additional programs to give elderly demented people dignity in an environment specifically designed for their needs, not just an organ in a hostel to keep them busy, have been refused by the Minister's Department. What of care according to need? I have shown that really is a farce. I want to show the Minister the depth of feeling on care for the elderly. I have a document with 24,000 signatures, not one of which was collected by a branch member of the Liberal Party. Those were collected in just two weeks. They are the signatures of average Australians in the Minister's electorate and in my electorate who are concerned about what is happening to their elderly relatives. The Minister has effected a real reduction in funding for the aged in our population. He has presided over gross bureaucratic over-regulation. There has been a terrible decline in standards. It is the Minister's Department that controls and approves absolutely everything. The proposed new system has had totally inadequate consultation. It has set predetermined arbitrary limits and forced people into those arbitrary limits. It does not take account of vast differences between the States in award wages and different infrastructure costs. That is illogical, inflexible and unfair. The public will not accept a situation where the Government shows a total lack of understanding, a total lack of care and a total lack of compassion. Mr CHYNOWETH(Dunkley)(3.50) —After hearing the honourable member for Chisholm (Dr Wooldridge) and wiping the tears from my eyes I would like to speak on this matter. The honourable member, no doubt, has made an intensive study of this subject because that is his profession. However, I should point out that he mentioned dementia. I have a great interest in this subject because one of the main supporters of the Liberal Party of Australia in my area, a certain Reverend Bob Payne, a Festival of Light organiser, happened to lose a dementia grant that this Federal Government gave him. It got lost in the money pot that he sort of spread around; the $20m of debt of the Baxter Retirement Village which arose when he made some incorrect investment decisions. Honourable members opposite do not have to talk about spending on dementia grants. I know all about it. I know what has happened to grants to supporters of the Liberal Party and the conservative parties. I would like also to comment on the honourable member for Richmond (Mr Blunt). The Minister for Community Services and Health (Dr Blewett) brought to my attention a story in a Queensland newspaper in relation to a statement by the honourable member for Richmond. The honourable member has repeated it again today. He has said that elderly patients will be force fed-as if they were chooks in some sort of production shed. Being a National Party of Australia member, I imagine that he would know all about that. What he and his Party have done, and what they are trying to do through total misrepresentation, is spread fear among the community. This is typical of the conservative parties in Australia. I can remember a couple of years ago when we had a certain Mr Hodgman as the honourable member for Denison in this place. His claim to fame came during the assets test debate when he said that there would be social security storm-troopers knock, knock, knocking at the door. Those were the sorts of theatrics he used all the time. He said that they would be knocking at the door and coming to rip out the gold teeth of pensioners. My parents have lived through all of this. They are still alive. They had no one knocking at their door. I think that my Dad still has his gold teeth. That sort of hysterical stuff from the conservative parties is typical of what is happening in Victoria now, what has happened in New South Wales and what happens all the time. The only way that they can stir up any sort of publicity whatsoever is to spread fear in the community. Fears and half truths are their tactics. They are experts at it; they have been doing it for years. I see that the honourable member for Cowper (Mr Nehl) is sitting in the House. He is an assets test expert and knows all about it. He is still peddling this sort of thing. The fears about nursing homes that honourable members opposite are starting to peddle now are exactly the same. Let me go through some of the things they are starting to do. No doubt we will get more and more of this. A document headed `Attention relatives and friends of nursing home patients' is typical of what is being passed around in nursing homes in Victoria at the moment. It is a proper printed document which goes through various issues that they believe should be brought to the attention of the Minister and the local Federal member. However, the letters that we have received from constituents all have a similar ring about them. I have here faxed copies-which I received just an hour ago-of every letter that has arrived in my office in relation to the nursing home problem. I would like to repeat a few sentences from each one to enable honourable members to see the connection. One letter states: We have appreciated the high standards of care that have been received- at a certain nursing home- We will not sit idly by and see those standards eroded as a result of cuts in nursing and personal care staff. Some of the letters are typed and some are hand written. Another letter states: We believe that this country owes something to the older citizen. Another letter states: I will not sit by and see that those standards are eroded as a result of cuts in summary care. . . . . This country owes something to its older citizens. Another letter states: I will not sit idly by and see the standards eroded as a result of cuts in nursing care. Do they sound the same? Another letter states: This country owes something to its older citizens. Many have given everything for their country in difficult times. . . . . I will not sit idly by and see these standards eroded. These quotations are all from letters that have arrived in my office from constituents of mine. It is funny how they use the same sentences. The odds against this happening are pretty rare. I do not know why they are using the same sentences. However, I do have a few other letters. One letter states: A study by a private individual indicates that the minimum care hours per patient per week is 27.3 hours. Another letter states: A study by a private individual indicates that the minimum care hours per patient per week is 27.3 hours. One begins to wonder a little when one gets all these letters that are exactly the same. They vary a little bit here and there, but they have the same sorts of sentences. What is going on? One asks whether this is some sort of concerted effort. Then out of the blue comes a Labor supporter who says, `Did you know that there is a standard letter going around?'. I said, `Well, I sort of had that impression'. That document is headed `Suggested letter for concerned people to their local Federal member of Parliament'. It then goes on to say, `Say either/or'. There are variations of how one can write the letter. I will just read out one little sentence which states: This country owes something to its older citizens. They are in many instances people who have given everything for their country in difficult times. Who writes these letters? Could they have been written by a Federal Liberal member who then sends them around? They could not have been written by a Labor member. No Labor member would be scurrilous enough to do that. That is the sort of concerted effort undertaken by the conservatives of this country to try to ruin a good and effective review of what is happening to nursing homes in Australia today. I will bring to honourable members' attention the variation in some of the benefits applying from State to State. The Commonwealth benefit per week is $418 in Victoria; $357 in South Australia; $325 in New South Wales; $295 in Western Australia; $282 in Queensland and $269 in Tasmania. We hear the Tasmanians screaming all the time about the high cost of things in Tasmania. However, in nursing homes in Victoria the Commonwealth benefit per week is $418. In Tasmania, it is $269. There could be some reason for this-such as administration. Maybe in Victorian nursing homes there are slightly different costs. However, these things should be pointed out to people who have relatives in nursing homes. Not only do many people in nursing homes have to pay over their pensions but also their relatives have to supplement the amount of money that they pay. I know of many nursing homes in my electorate where this happens. In the electorate of Dunkley I have one of the largest populations of aged people in Victoria. Going down the Mornington Peninsula to the electorate of Flinders, which I also have a bit to do with, I see that there are also many people there who require nursing home accommodation. What has happened in the last five years? In our area there has been quite an increase in the number of nursing home beds. There are more beds to come and more nursing homes are being built. The situation did not change for years and years. The local councils were allowing all these retirement homes to be established on the Mornington Peninsula. The elderly from all over Victoria and interstate were being brought down to that area. Now there is a crisis. We are trying to do something about it. We are trying to assist all elderly and frail aged people. By undertaking this review-it is only a review and it will be reassessed in 12 months-we are trying to make a better system. We are trying to get rid of those unscrupulous operators within the nursing home industry. It is an industry. Many people have made millions of dollars out of nursing homes. They will continue to make many millions. However, there are many well run nursing homes. There are many charitable and church homes which are run not only at a loss to the charity or church but also in a way which benefits the patients. Mr DEPUTY SPEAKER(Mr Mountford) —Order! The honourable member's time has expired. The debate is concluded. Mr BARRY JONES(Lalor-Minister for Science, Customs and Small Business) —by leave-In May 1984 the Minister for Industry, Technology and Commerce, Senator Button, announced in the Senate a new policy package for Australia's passenger motor vehicle industry. That plan was an early and major initiative by this Government to begin the process of change, renewal and revitalisation of Australia's manufacturing sector. We faced at that time a profound sense of pessimism and lack of direction which had come to permeate our motor vehicle industry. Through the passenger motor vehicle plan the Government sought to encourage confidence where there had been uncertainty. We sought to foster a shared strategic vision after a decade of crisis containment. The plan set out to take an important Australian industry in difficulty into a position of competitive strength in the 1990s. The plan was from the outset a key element of the Government's approach to industry policy. It was established to provide the framework for the necessary transition from a high cost domestically oriented industry towards a more competitive, internationally oriented industry supplying Australians-and the world-with better quality automotive products at more reasonable prices. The agenda for the industry in the 1990s set the following long term objectives: the industry needed to be able to prosper, with lower levels of government assistance; it must provide consumers with quality products, at reduced prices in real terms; the necessary restructuring needed to be carried out with minimum levels of disruption. While most though not all of these objectives are being met, they remain the objectives which the Government seeks to achieve through its passenger motor vehicle policy. To allow us to achieve the objectives we set up the Automotive Industry Authority (AIA) and asked it to embark on a strategy with the following elements: rationalisation of the industry in terms of models and manufacturing groups; an increase in the competitiveness of the industry to become an area of strength of the Australian economy rather than weakness; arrangements to accomplish the changes with minimum disruption and cost. These strategies remain as relevant today as they were in 1984 and the industry, with the active participation of the AIA, has made substantial progress in implementing these strategies. After only three years there has been major rationalisation of producers. Holden's and Toyota are to enter into a joint manufacturing venture, while Nissan and Ford are investigating ways in which they too can integrate their manufacturing activities. By the end of next year it is expected that the number of models produced in Australia will have reduced from 13 to eight. Average volume per model will have increased from 25,000 units to over 40,000. Automotive exports reached $755m in 1987, an increase of $290m or 63 per cent over the previous year. This is almost double the level of 1984. Other export programs which are planned or about to be implemented promise a continuation of this growth in dollar terms over the next two or three years. Investment has also increased sharply. For example, in the vehicle sector, investment has risen from an average of $194m per annum in the period 1982 to 1984 to $503m per annum in the period 1985 to 1987. This shows confidence in the viability of Australian car manufacture into the next century. In the past four years, the industry has embraced the challenge of restructuring, in spite of a very weak vehicle market. The plan has enabled this to happen without major disruption to the people employed in it, with one notable exception: the closing down overnight of the Besco battery plant in Sydney. Even where there have been plant rationalisations to improve overall efficiency, these have been achieved with long term planning, and significant consultation with the work force. The terms of the plan have always provided for a mid-term review of its progress. That review has been carried out by the Automotive Industry Authority with the aim of ensuring that the plan's mechanisms are continuing to reinforce that strategy and promote achievement of the objectives as we move towards the 1990s. The review found that while good progress had been made there was room for improvement. It concluded that the better competitive environment for the Australian industry now enabled some acceleration of the original plan provisions to ensure that the incentives for adjustment are maintained. The review also found that there was room for improvement, particularly in the objective of achieving more affordable cars for consumers. The level of prices of local production is a real concern to the Government. The initial plan had as an objective a reduction in real prices over time. This objective remains. The Australian consumer deserves to receive benefit as soon as possible, given the level of assistance afforded this industry. Resulting from that review, the recommendations made by the Authority and consultation with the industry and its unions is a series of adjustments to the mechanisms of the plan to ensure that the plan remains on track and the objectives are achieved by 1992. The primary objective of the decisions announced today is to reinforce the original plan framework. But there is a secondary objective. The Government is also taking the opportunity provided by the improved competitive position of the Australian industry to ease the passage of the industry into the post-plan environment from 1993. An abrupt shift in the policy environment at the end of the Plan would be in no-one's interest. The Government had considered announcing this decision in the May statement but due to the potential impact on the motor vehicle market of delaying the announcement we have decided it should be released without delay. I now turn to the specific refinements to the plan decided by the Government. Details are provided in an accompanying paper. Quota/Tariffs The major unforeseeable change since 1984 has been the fall in the value of the Australian dollar. International competitive pressure on the Australian car industry has slackened considerably. The Government intends to reassert that pressure in several ways to restore the incentives for change originally envisaged. First, from today tariff quota protection for the Australian industry is abolished. These quotas, which have been in place in some form since 1975 were not to have been finally withdrawn until 1992. This decision will be recognised in Australia and abroad as a milestone for an industry getting back on its feet. In taking this historic decision the Government noted that this was a further demonstration of Australia's commitment to the current round of Multilateral Trade Negotiations. Second, tariff rates are to be reduced faster and further than originally announced. From today, the operative tariff of 57.5 per cent is to be reduced to 45 per cent. There will be further annual reductions from 1989 leading to a rate of 35 per cent in 1992. To retain competitive relativities, tariffs on light commercial vehicles and four-wheel drives are to be reduced immediately from 35 per cent and 25 per cent respectively to 20 per cent and will then be phased to 15 per cent by 1992. The Government is pleased that these reductions will be a direct and immediate contribution to containing costs for business and farmers. Local Content The Government has given particular attention to the local content arrangements of the current plan. As a result of the plan's stability, the depreciation of the Australian dollar particularly against the Japanese yen, and the 85 per cent local content scheme, the Australian component producers have found themselves in a very competitive position compared with imports. In addition there has been extensive company rationalisation which has created a significant number of sole suppliers in this sector of the industry. While some components companies have taken advantage of these benefits to improve their general performance, a significant number have not. This lack of performance has come about because this sector has tended to experience less adjustment pressure from the plan than other areas of the industry. The components sector should be subject to the same pressure for change as other parts of the industry. This will be achieved within the framework of the 85 per cent local content scheme. The system of prohibitive compounding penalties imposed on plan producers for non-achievement of the 85 per cent local content target will be removed. They will be replaced from 1 January 1989 by a less stringent system of non-compounding penalties on imported content in excess of the 15 per cent duty free concession available to plan producers. Beginning in 1989, these penalties will be the same as the duty rates applying to passenger motor vehicles. The additional flexibility to be provided to plan producers by this measure will add to the competitive pressure on component suppliers. Export Facilitation The aims of the export facilitation arrangements of the plan are to facilitate product rationalisation and to reduce component costs in Australia, as well as to open doors for exports of vehicles and components in their own right. The car plan seeks to give the Australian industry every opportunity to join in the increasingly integrated global market for vehicles and vehicle components. The Government values, the export facilitation arrangements and the achievements which have already flowed from them. Major overseas markets have been prised open where they would otherwise have remained closed. Mr Moore —Just like oysters. Mr BARRY JONES —Or better than that. It is incredible to think that we are now exporting motor vehicles to Japan, engines to Germany and so on. This is a remarkable achievement. Production runs for certain components have been increased towards world scale. Export facilitation will continue to be a feature of the car plan. Details of the changes proposed are in the accompanying paper. In essence, there will be an expansion of the available credits of 5 per cent, although these will only be earned at 50c of export credits for each dollar of exports. The changes we have made in this area partly restore the effect of this scheme envisaged in 1984. International Trading Practices The Government is committed to ensuring that the Australian industry not be disadvantaged by unfair trading practices by exporters to Australia. Accordingly, Senator Button and I have instructed the Automotive Industry Authority and the Australian Customs Service to intensify surveillance. Monitoring and Review These adjustments to the plan have been designed to re-establish the competitive circumstances for the Australian industry originally envisaged in the plan. The Government does not expect, therefore, that there will be serious disruption of production or employment as a result of the adjustments. Nevertheless, Senator Button has instructed the Automotive Industry Authority to monitor and report to him on the impact of the adjustments. Post-plan Review Consistent with the Government's concern to provide a stable environment for longer term industry planning, I am confirming today the Government's intention to provide reasonable notice of the environment to be faced by the industry after the plan ends in 1992. To provide the necessary period of notice, the Government envisages that a reference would be sent to the Industries Assistance Commission in 1991, for consideration by the Government early in 1992. However, it should be clear from the nature of the changes I have announced today that the present plan-as adjusted-is very much a transitional mechanism designed from the outset to enable our automotive sector to move from the difficulties of the 1970s to a less protected, more open environment in the 1990s. New Zealand The Government is conscious of the potential implications of these changes for trans-Tasman rationalisation. The changes to motor vehicle arrangements in New Zealand recently announced by the New Zealand Government may have corresponding importance. Accordingly, Senator Button has spoken with David Caygill, our counterpart in New Zealand, and we have agreed to begin immediate discussions between officials about a range of issues. Implementation Arrangements Legislation will be necessary to effect the changes in tariff rates. The Government will be introducing the changes in the context of a Customs Tariff Amendment Bill as a matter of urgency. Mr Moore —Another one. Mr BARRY JONES —We look for the co-operation of the Opposition. Alterations to administrative arrangements will be published in a forthcoming Australian Customs notice. Conclusion In 1984, Senator Button announced a policy for this industry which set clear goals, and a means to achieve those goals. The automotive industry has accepted the challenges I put before it in 1984. Restructuring is taking place without significant disruption. Exports are increasing significantly. The industry has been investing heavily to enable it to compete with reduced levels of assistance. The measures announced today ensure that all we have so far achieved is not lost. In addition, it creates the right environment to achieve those aspects of the plan which have not yet been realised. I present the following paper: Mid-term review of the car plan-Ministerial statement including attachment, dated 13 April 1988. Motion (by Mr Beazley) proposed: That the House take note of the paper. Mr MOORE(Ryan)(4.14) —The paper brought forward by the Minister for Science, Customs and Small Business (Mr Barry Jones), on behalf of the Government, is welcomed by the Opposition. However, I cannot help but wonder what prompted the Government to act. The Minister in his statement said that the major unforeseeable change since the implementation of the plan in 1984 has been the fall in the Australian dollar. That fall occurred in 1986. Two years later the penny has started to drop about what is going on in the car market. During that time we have noticed that sales of motor vehicles have declined to the levels of the early 1960s. One of the prime reasons for this has been changes to the fringe benefits tax and to other areas. The industry's figures show that about 447,000 new motor vehicles were sold in 1987-about 250,000 fewer than in 1985. Does that reflect well on the car plan? The Minister's statement makes reference to the unforeseen circumstances of the devaluation in 1986. However, this was not caused by anything but a loss of confidence in the Government's ability to handle foreign debt when overseas people sold the Australian dollar. That was triggered by the remarkable exercise involving the MX missile which at the time really shook confidence and forced the dollar down. As a consequence of that, increasing amounts of protection were given to Australian motor vehicle manufacturers. This happened at the time when imported motor vehicles became so much more expensive. One might have thought that in this environment there would certainly be a competitive push on the Australian produced car price. What happened? Instead of that, the cost of the Australian produced Laser motor vehicle, for example, went up by nearly 60 per cent in the period between 1984 and 1987. During the same period, the price of the popular family car, the Ford Falcon, which now starts at $20,000, went up by some 43 per cent. I draw the attention of the House to the opening comment of the Minister: The agenda for the industry in the 1990s set the following long term objectives: One of the objectives is: . . . it must provide consumers with quality products, at reduced prices in real terms; I invite honourable members to try to weigh up the Minister's comment with the facts. Just to choose a couple of cars at random, there has been an increase in the price of a Ford Falcon of 43 per cent and an increase in the price of the Laser of 60 per cent. At the same time, car prices in the last two years have increased at about double the rate of the consumer price index. There has been a 20 per cent discount in car sales in the last two years. It now takes an Australian worker on average weekly earnings 46 weeks of wages to buy a standard Commodore compared with 39 weeks as recently as 1985. I invite the Minister to address those questions because they reflect that the plan has not worked in terms of the criteria set down by him in the paper. He needs to look at what is going on and the Government's response. Just before Christmas a debate on tariffs was under way in the Australian Labor Party. The Treasurer (Mr Keating) said, `Let us cut tariffs by 25 per cent across the board'. After Christmas, he was followed by the Prime Minister (Mr Hawke) and the Minister for Employment, Education and Training (Mr Dawkins), who talked about a 20 per cent cut across the board. Then I noted that the Caucus structural review committee-I do not know what factions are involved in that-talked about a cut of some 15 per cent. There has been quite a picnic going on. I do not know which one the Government is going to adopt-25 per cent, 20 per cent or 15 per cent. Mr Barry Jones —Are you going to talk about the Liberal Party in a minute? Mr MOORE —I am going to talk about the Labor Party. On top of that, the Kerin plan on structural change came out today. All of these things should have been addressed when devaluation occurred in 1986. Two years later we are gradually getting around to them. Mr Tim Fischer —Just as the dollar goes up. Mr MOORE —As the honourable member for Farrer says, just as the dollar is going up. That is great timing! It is almost as good a timing as the by-elections we have just had. As a consequence of those acts by the Government, I cannot help but wonder what it is attempting to achieve. Firstly, consumers should benefit from the decrease in tariff levels on passenger motor vehicles as they move from 57 1/2 per cent to 45 per cent and eventually, in 1992, to 35 per cent. At last the consumer might get a go. Under the old rules the Australian market was divided-that is, 80 per cent for the Australian domestic product and 20 per cent for imports. Because of the devaluation, fully made up imported cars have decreased to about 5 or 7 per cent of the market. So a big deal is made about knocking out the quotas, but there was no longer a premium to buy those cars. No-one could buy them because of the devaluation. The pricing factor came into it. As the level of imported cars went up, we took away the pressure on the domestic product. As a consequence, we have seen a rise in the price of a Falcon or a Laser. Secondly, the Government does not get many bonus points for the fact that tariff quotas will be abolished altogether. Effectively they have already been abolished because of the movement in terms of devaluation. Thirdly, tariffs on light commercial vehicles and four-wheel drives are to be reduced immediately from 35 per cent and 25 per cent respectively to 20 per cent, phasing down to 15 per cent. That will come as a major relief to the primary sector and those involved in rural and mining areas. Those items have become very expensive in the last couple of years. In the consideration of the post-1984 plan by the previous Government, it was thought that a four-wheel drive vehicle might be a suitable substitute for a sedan car. That is no longer the case because the pricing mechanism put the four-wheel drive out of reach. Those vehicles became far too expensive and campuses are no longer blocked with four-wheel drive vehicles. They are probably the domain only of those few yuppies who are left after the share market crash. Fourthly, from the beginning of next year, the 85 per cent local content regulation will be relaxed because penalties for non-compliance will not be so stringent. That is the only area that puts some pressure on local producers. The Government has caved in to pressure from small component manufacturers. Many of those manufacturers are in marginal electorates held by the Government, and that is why the Government has not addressed the question. The Australian manufacturer is required to use 85 per cent Australian content and 15 per cent imported content-imported duty free. The Government provides for export facilitation, which allows adjustment of those figures. However, the 15 per cent duty free import has been affected by devaluation. The Minister may not be aware of it, but between 1986 and today the price of an imported engine for use in putting together, say, a Toyota has doubled. Australia has had a good market for the export of engines, but there are also some imports in that area. Those percentage requirements could well have been adjusted to make the area more competitive. Instead, the Government has taken the soft options of the continuing shambles: it has removed the compounding penalty and imposed a simple penalty. If people wish to go beyond the 85 per cent, they pay a simple penalty rather than a stiff penalty. The Government is thereby continuing to encourage the non-competitive situation of some local component manufacturers. Fifthly, there is to be export facilitation. That is a worthy step with which I would agree. The export facilitation package was brought in by the late Sir Phillip Lynch. It was welcomed by manufacturers, particularly General Motors-Holden's Ltd, because it was able to step up production lines and aim those products overseas, thereby reducing the marginal cost of the unit. That package was well received in the manufacturing area. I now turn to two other matters which go beyond the five changes in stage 2 of the car plan announced by the Minister in his statement. Firstly, the stage 2 plan is notable for the fact that it contains very few trade-offs, the only one being some reduction in local content requirements. Secondly, there is absolutely no comment on the question of deregulation of the labour market. If we are to achieve some efficiencies in the car manufacturing industry, those areas must be addressed. Fiddling with percentages will not force results because the compelling elements will not be there. On behalf of the Opposition, I say that the plan and its general direction is welcome. It provides for a reduction in tariffs and acknowledges that we have to live in the real world. It points to the fact that when we afford very large elements of protection, the Australian consumer ends up footing the bill. The requirement set out in the statement that the consumer should benefit has not been met. That has been demonstrated by the price of cars and by the fact that it takes more working days to buy a car today than it did two years ago. For a person on average weekly earnings it takes five more weeks to buy a car today than it did two years ago. Living standards have fallen enormously under Labor. That is why Labor's results were so bad in the by-elections, and they will get worse. In the end, falling living standards will put the Government out on its neck because it has not addressed the question. That is reflected in the car industry. Sales are down because living standards are down, while the cost of the average car has increased. In addition, there has been no attempt to come to grips with the issues. The Government has deferred most of the options. We believe that, while the general direction is correct, the ultimate outcome is short of the mark. Many of these plans seem to present difficulties in terms of administration. In opposition it is hard to make a judgment on exact figures unless one has access to the Authority's programs. If those programs were made available to the public or to the Opposition, I am quite sure that a more realistic assessment could be made. In the short term I have to say that the program put forward is welcome, despite its many shortcomings. Mr BALDWIN(Sydney)(4.28) —The honourable member for Ryan (Mr Moore), who has just spoken, demonstrated quite conclusively that the Opposition has learnt absolutely nothing from the destruction of Australian manufacturing industry that took place during the latter part of its tenure of office. There was an overvalued currency resulting in the decimation of large sections of Australian manufacturing. It does not seem to have learnt anything from that experience. The honourable member bemoaned the fact that the value of the Australian dollar had fallen. That was portrayed as a terrible thing and a sign of poor economic management on the part of the Government. In actual fact, the key result that has flowed from the depreciation of the Australian dollar so far as the passenger vehicle industry is concerned is a 30 per cent improvement in international competitiveness. That, in turn, has created an environment in which, firstly, there has been a major growth in exports of passenger motor vehicles, as well as a range of other manufactured goods, and secondly, a climate in which it is seen to be tenable for major car manufacturers to undergo a substantial investment program. The Opposition might regard that as of no great consequence. The long term potential that gives to create a viable industry, to create employment in the long term, and to provide an economic structure where employment growth can occur over the long term is obviously not important to the Opposition, but the Government thinks it is important. The honourable member's comments show that the Opposition has not progressed much over the last few years. Almost all sections of the Australian community have come to recognise that a viable manufacturing base is an essential prerequisite to turning around our balance of payments problems and securing continued growth in living standards. The previous speaker also began by posing the rhetorical question of what caused the Government to undertake this review at this time. He said that the exchange rate depreciated from 1985-86 and asked why something had not been done before this. The simple answer is that the Government has an approach to industry policy which hinges on trying to create a climate of predictability and stability for those involved in the industry, those on the labour side and also the major manufacturers, where they can look ahead and make decisions based on a reasonable level of medium term certainty of expectations. The mid-term review was part of the original plan. It was envisaged as a mid-term review, not something that would take place after the first year of the plan's operation. Obviously the Government determined that it was desirable to have a stable and predictable protection regime for a reasonable time and then, after that time, in accordance with a preordained plan, conduct a review of the arrangements. That is precisely what has been done. That broad approach has been vindicated by the results not only of this industry plan but also of the other industry plans that the Government has implemented or is in the process of implementing. At the time the car plan was implemented there was a pervasive mood of pessimism throughout the car industry and there were some suggestions of very substantial employment losses and a very major collapse of production and capacity in that industry. That was the fear or expectation at that time. There was also the fear that such an occurrence would be a disaster for the economy. The motor vehicle sector is a key part of Australia's manufacturing activity. As I said earlier, the preservation of a viable manufacturing base is crucial for our economic future. There is a school of thought that as an economy evolves there is a gradual shift, first from agriculture to secondary industries and then, over time, a gradual movement into the services and tertiary sector, and that that is a natural and reasonable sort of thing to happen. The claim is made that many people on the Labor side of politics attach excessive weight to the need to preserve a manufacturing base. Those views basically are misconceived. If we look at the shift between sectors-the movement from blue collar-type activities into services and so forth-there is not just an intersectoral shift from manufacturing to services; there is also a significant intrasectoral shift where a great deal of the information technology effectively is an input into the manufacturing process. I refer to such things as computer-aided design and manufacturing. There is an increase in white collar, highly skilled, information-oriented activities within the manufacturing sector as well as a shift from manufacturing into these other areas. That is a key point. A lot of that sort of activity is dependent on the continued existence of a viable manufacturing base. It is hard to see how we could have an industry engaged in the design of motor vehicles without there being a viable motor vehicle manufacturing activity. So the preservation of a viable motor vehicle industry is crucial. That is the Government's view but the previous speaker made it perfectly clear that it is not really an Opposition priority. Mr Hawker —What rubbish! Mr BALDWIN —The previous speaker lamented the fall in the value of the Australian dollar which is an absolute prerequisite for the preservation and regeneration of Australian manufacturing. The honourable member says that is rubbish but the previous speaker belies that interjection. It is not just my opinion. I add that the motor vehicle sector has also been in the forefront of the introduction of a number of key technologies that, again, are essential to sustaining a viable manufacturing base outside the motor vehicle industry. Such things as total quality control and `just in time' techniques are things for which the motor vehicle industry has provided the cutting edge but they have an applicability that goes well beyond the motor vehicle industry. The Government is conducting a mid-term review in accordance with its preordained plan. The key change over the last few years, as the previous speaker said, is the fall in the Australian dollar. So far as the motor vehicle industry is concerned, the most crucial part of that is the fall of our dollar compared with the yen. As a result we have seen a 30 per cent increase in effective protection for the motor vehicle industry. That was not originally expected to occur. In some sense it represents a windfall competitive gain for the motor vehicle industry. That has had an impact on prices. Unfortunately, some motor vehicle manufacturers have chosen to take advantage of that improved change in the exchange rate relativity to reap the benefits of higher prices, without seeking to compete in the price area. That is a major deficiency and is something the Government is seeking to address by these changes in the protection regime. It will try to put a bit more pressure on both domestic car manufacturers and the component manufacturers through changes in local content requirements, the abolition of tariff quotas, the reduction in the general level of tariff and so on. The idea is to bring about some downward pressure on motor vehicle prices and put a bit more pressure on the manufacturers of cars and components to try to get them to compete effectively in the price area. A consequence of this mid-term review has been an attempt to address the problem that the previous speaker referred to, but to try to do it in an orderly fashion as part of a predetermined review rather than throwing the carefully negotiated plan out the window after the first year of its operation. On the competitive gain flowing from the devaluation, according to calculations carried out by the Bureau of Industry Economics, if we were to reduce tariff levels in such a way as to completely compensate for the competitive gain that has come from the devaluation and try to get the industry back to the competitive position it faced in 1984-or we expected it to face in 1984-we would be looking apparently at an end point tariff of around 10 per cent, compared with the 35 per cent envisaged in the plan. Even if we look at the possibility of a 25 per cent appreciation in the exchange rate between the Australian dollar and the yen over the next four years, to get back to what would have been a reasonable expectation in 1984 the implied tariff rate would have been 25 per cent, compared with the Government's revised tariff level post-1992 of 35 per cent. So whichever way we look at it there is a pretty substantial safety margin. The change in the protection regime that has been carried out is broadly consistent with meeting the reasonable expectations of potential manufacturing investors at the beginning of the plan. So what is being done is reasonable. The one-off drop is fairly large admittedly-from 57 1/2 per cent to 45 per cent, followed by several years of incremental reductions of 2 1/2 per cent per annum down to 35 per cent. The initial drop is quite large but when we look at the overall picture I think that what is being done is not unreasonable. I would be rather surprised to hear a strong reaction of concern from the manufacturers or unions. There is a contrast so far as this tariff cut is concerned between this industry and the textiles, clothing and footwear (TCF) industry. At the moment we are looking at the possibility of across the board tariff cuts. There was some speculation that the TCF industry could be included. I would be concerned about that although I am not so concerned about this instance because the TCF plan was negotiated in the latter part of 1986 after the major devaluation of the currency had taken place. There is nothing analogous to the windfall competitive gain that has flowed to the motor vehicle industry as a result of the 35 per cent drop in the value of the Australian dollar since the plan was originally introduced. There is a significant difference. Speaking personally, I should be rather concerned to see a significant tariff cut impact in the textiles, clothing and footwear industry at this time when it is at the beginning of a negotiated phased reduction in protection levels which has been arduously negotiated over a period of time. There are a number of other points that one could make but I shall conclude by saying, as is clear, that the motor vehicle industry has had difficulties during the past couple of years. Despite those difficulties a significant element of restructuring has taken place in accordance with this plan. We have seen a significant rationalisation in the industry, a reduction in the number of manufacturers and models, big investment programs, and a shift towards exports. These are all matters that the effects of the plan sought to bring about. The evidence is that the plan has been very successful. However, for a variety of reasons, we have had a period of depression in the local motor vehicle industry. I believe it is most important that the effects flowing from a change in a protection regime of this sort should be monitored very carefully. In effect, the Government has committed itself to doing that, by instructing the Automotive Industry Authority to examine carefully the impact on employment and other consequences of this change in the tariff protection regime. Generally, the Government has attempted to act to avoid too large a change in the protection regime because of the destabilising effect that it would have. Hopefully, as the Minister for Science, Customs and Small Business (Mr Barry Jones) pointed out in his speech, the impact of these changes should not be too severe. It is critical, however, that there be a thorough monitoring of effects. I certainly intend to continue to push for that careful monitoring to take place. Mr NEHL(Cowper)(4.43) —Today, 13 April, is a very significant date for the Australian automotive industry. Today tariff rates have been reduced from 57.5 per cent to 45 per cent and will decrease by a further 2.5 per cent per annum to reach 35 per cent in 1992. The tariffs on light commercial vehicles and four-wheel drive vehicles are down today from 35 per cent and 25 per cent respectively, to 20 per cent, and are expected to reduce to 15 per cent by 1992. I must say that I approve of these reductions. From 1 January 1989, in line with the 85 per cent local content provision, there will be no compounding penalties and penalties will be imposed at the same rate as the motor vehicle tariff, which is 45 per cent. We all should be concerned about local content and local manufacture. There have been problems concerning the lack of competitive pressures on component manufacturers and we will have to monitor this situation very closely. I am pleased also that the export facilitation scheme will be expanded by an additional 5 per cent. I note too that the Minister in his statement made some reference to other export programs that are planned or are about to be implemented. The Opposition, as I am sure would the industry, would be pleased to learn what those other programs are that are planned or are about to be implemented. Interestingly, today the Minister for Science, Customs and Small Business (Mr Barry Jones) said that the level of prices of local production is of real concern to the Government. I inform the Minister and the Government that the level of prices of local production is of real concern to the Australian people also. It is of real concern to the average family, whether in Geelong, Sydney or Coffs Harbour, that wants to buy a new motor vehicle. All Australians are concerned at the prices of locally manufactured vehicles. It may be of interest to honourable members if I reflect on how prices of motor vehicles have risen. On 22 December 1982 the basic automatic Ford Falcon cost $11,737. On 1 December 1985 the price was $14,007. Today the price is $19,758. Of course, to be fair, I must say that changes have been made to the vehicle; it has been upgraded. Nonetheless, the increases in price have been significant. In 1983 the basic automatic Holden Commodore cost $11,795. In 1985 it was priced at $14,226. Today the price is $20,088. Mr Hawker —That is almost double. Mr NEHL —That can be seen from the percentages that I will provide shortly. The Minister said also that the major unforeseeable change since 1984 has been the fall in the value of the Australian dollar. The Australian dollar fell three or four years ago and it is now going up again. Is this the reason for the timing of the changes that are being implemented now, instead of their being introduced in May in the mini-Budget? The honourable member for Sydney (Mr Baldwin) made some reference to the honourable member for Ryan (Mr Moore) saying that he lamented the fall in the Australian dollar. That was not so. The honourable member made the same point I have just made. The honourable member for Sydney also made some reference to the Government's desire to create a climate of predictability and stability for those in the industry. I assure the Minister that that is what is required but the Government is encouraging far too much speculation with tariffs, and has done so over a matter of months. Before Christmas the Treasurer (Mr Keating) was blithely talking about a 25 per cent across the board cut in tariffs. Early this year, the Prime Minister (Mr Hawke), the Treasurer and the Minister for Employment, Education and Training (Mr Dawkins) were all flying kites about a 20 per cent cut in tariffs across the board. What they have done is to fuel uncertainty, not just in the motor vehicle industry but in all industries in Australia that are affected by tariffs. Mr Tim Fischer —Especially component manufacturers. Mr NEHL —As the honourable member for Farrer says, especially component manufacturers. I am concerned also about other industries. One might well ask: What are those in the textiles clothing and footwear industry wondering? What about the chemical industry? What is it wondering? Are those industries asking: What will happen to us in May? What will the mini-Budget do to us? I think that that is a very strong likelihood. They are concerned about what might be happening to them. I appreciated the comments of the honourable member for Sydney when he expressed his concern for the textiles, clothing and footwear industries. One of the significant things about this lack of certainty-and it really is a lack of certainty-is that investment will be held up. For years now we have been discussing the need for Australian manufacturing to get up and going, for our exports to increase and for our manufacturing industries to be more competitive. For that to happen, there has to be investment. If a manufacturing industry proposes to increase its manufacturing capacity, by importing new plant for instance, it is not an easy thing for it to do, new factories and new manufacturing lines are not just created out of thin air. Orders have to be made well in advance. There is a long lead time and the industry needs to know what the tariff situation is going to be. Throughout Australia there is a perception that the Government has not done what it should have done to do away with speculation. I ask the Minister: How much consultation went on with the industry and unions before the announcements today? The Vehicle Builders Employees Federation of Australia has a good track record. Its members work in a sane and sensible fashion. I wonder whether the Minister has done the right thing with adequate consultation. We in the Opposition support the car plan and its thrust to create competition. But that has not happened. Prices have increased. I repeat: in December 1982 the cost of an automatic Ford Falcon was $11,737. Today the cost is $19,758; a 68 per cent increase. In 1983 the basic automatic Holden Commodore was priced at $11,795. Today the cost is $20,088; an increase of 70 per cent. Those increases make it very difficult for ordinary Australian families to buy a new car. If one is looking at the cars of the Australian people the Holden and the Ford are the basic cars. Of course many other imported cars are very popular, but historically the Ford and the Holden have been the basic Australian cars. The honourable member for Sydney also mentioned that because of the rise in the dollar local manufacturers were reaping the benefits of higher prices which were related to the cost of imported vehicles. Mr Tim Fischer —He danced around a bit. Mr NEHL —He did dance around a bit and he laid this charge against local manufacturers. I cannot claim to be totally conversant with the profitability of all Australian vehicle manufacturers but my memory suggests that it is only Ford that is doing particularly well and the rest are not doing well at all. The rest are in need of assistance. They are in need of a boost to profitability. But the honourable member for Sydney said that they have reaped the benefits of higher prices. I do not think that that is correct. The honourable member for Sydney also said that the automotive vehicle industry-and this is a classic piece of understatement-in Australia had been in a period of depression for a variety of reasons. Boy, what a statement! It is more than a period of depression and it is more than a variety of reasons. I would be very pleased to give the Minister some of those reasons. They are quite clear cut. The prices of local manufactured cars have gone up so drastically because of the actions of his Government. They have gone up because of what the world's greatest banana republic Treasurer has done, because of what the Minister has done and because of what his colleagues have done. The prices of locally manufactured cars have gone up to such an extent because of the action of his Government. They have gone up because of interest rates which have been right beyond the pale. They have gone up because of the changes in sales tax. Without any doubt they have gone up because of the fringe benefits tax. They have gone up because-- Mr Hawker —Because of interest rates. Mr NEHL —I have already mentioned interest rates. The honourable member should pay more attention. They have gone up because of the collapse of the Australian dollar. Labor's policy has put a new car beyond the reach of many Australians. It is worth noting that car prices have increased by about double the rate of the consumer price index over the last two years. Sales of new motor vehicles have declined to the levels of the early 1960s. This is what the Labor Party and the honourable member for Sydney call a period of depression. Sales are down to the levels of the early 1960s. Industry figures show that about 447,000 new motor vehicles were sold in 1987. That is almost 250,000 fewer than in 1985. As a result-and everybody knows it-production of new motor vehicles in this country has declined dramatically. Many jobs have gone. In fact, just in the motor vehicle industry in South Australia between August 1984 and August 1987, 3,000 jobs were lost. That is 3,000 workers in this country who are now without a job because of the uneconomic basis of production, because of the interest rates, because of the sales tax, because of the fringe benefits tax, because of the collapse of the Australian dollar and because of the Treasurer's policies. As well as that, throughout this country motor vehicle dealers have gone to the wall. It is not good enough. What we need is a strong Australian automotive industry, a viable automotive industry, a competitive vehicle industry which produces cars that can be afforded by all Australians. I hope that these measures introduced today by the Minister will help bring that about. Mr CHYNOWETH(Dunkley)(4.54) —The motor vehicle plan is an extremely important measure that affects the electors and constituents of Dunkley, because in the area surrounding Dunkley we have a large industry base that supports the Victorian and Australian car industry. We have in Dandenong the General Motors-Holden's Ltd factory. Many of its workers live in the Frankston area. At Westernport we have the Lysaght company, which supplies much of the steel that goes into Australian cars. We have in the electorate of Dunkley itself at Frankston the firm of Yazaki Australia Pty Ltd, which supplies all the wiring looms for every car manufactured in Australia. So I have a great interest in this change to the motor vehicle plan. We have not had much time to look at it or to check all the facts, but I know from discussions with the Minister for Industry, Technology and Commerce (Senator Button) this morning that there has been a great deal of consultation between the industry and the unions. I trust that both the industry and the unions will agree with stage 2 of the motor vehicle plan, a plan which has certainly assisted the car industry. It will protect the industry and it will also add a bit more competition. There was some sort of windfall assistance to the Australian manufacturers when there was a devaluation. I do not know whether they increased the prices of their cars because prices for Japanese cars increased considerably. However, the increase in prices in the domestic market reflects a number of things. I think there are reasons for this increase. First of all, the cars that are manufactured today are of a much better quality than they were a few years ago. They last longer and there is a lessening tendency for people to replace their cars every couple of years. I bought a Ford Falcon two years ago and I will be keeping it for another year or two. The motor is good and it is an excellent car. There have also been changes in patterns of expenditure. People do not put a lot of money towards buying a car. They use some of their earnings for overseas travel and home improvements. They are buying video recorders, electronic gear and other things for their home. The emphasis is no longer on the private car and this is one of the reasons why people are not buying them continually. Many years ago for some it was a matter of prestige to have a fancy car. I think those days have gone. People use a car as a functional item these days and that is another reason they hang on to them just that little bit longer. That is reflected in the fact that car sales have dropped quite a bit. In Victoria we are the main base for the car industry. Just recently the Premier, John Cain, was at General Motors-Holden when the millionth engine was exported. That is a tremendous record, and all this has happened in the last few years. It would never have happened under the conservatives in Australia. Had they continued in office the steel industry would have been gone. It was closing down in 1983. I remember when I was first elected going to Lysaghts with the Minister for Science, Customs and Small Business (Mr Barry Jones). The company was in a desperate state. Broken Hill Proprietary Co. Ltd was going to close everything down. Lysaghts just did not know what to do. Without a doubt Senator Button and other people within the Government saved the steel industry in Australia. It would have gone if it had been left to the conservatives. They would have imported all our steel. I would say that the same thing would have happened in the car industry. One has only to look at the increase in the number of job vacancies even in one of my local papers, the Frankston Standard. The number of pages of job vacancies has increased from one or two in 1983-84 to four to five. Many of them are in the manufacturing industry and in industries connected with the motor car or steel industries. We have brought about a climate that will accept some sort of change. We have made certain that our manufacturers in Australia are competitive, that they will be able to compete on the world market. As I said, we have an example of that with the millionth engine being exported. I know that Ford is looking at exporting a sports car to the United States of America in the very near future. I believe General Motors also has plans to be involved on a larger scale in the export market. So there are many good things happening. This plan will make us more competitive on the world scene, and that is important. I trust there will be some spin-offs for the consumers. The plan should provide better competition and make prices drop a little bit. That is what we are all about, supplying better conditions for the car industry and better conditions for Australian consumers to benefit from lower prices. I take this opportunity to mention my particular hobbyhorse, that is, the field of robotics. I know Ford has, in a big way, gone into robotising its body and assembly plant. It has installed extensive robotics to make the work easier and have fewer people working in that particular area. For some time I have been talking about a technology tax. However, no-one likes the word `tax' so I change it to technology compensation. Every robot installed does not actually consume anything in our society, but it does take up jobs. Robots are not specific machines; that is, they are not dedicated to a particular task. This is the first time in human history that a machine has been able to do a multitude of tasks and actually take the place of a worker. Some sort of compensation should be paid to the Government, to the unions and the people displaced. That compensation should be vested in some sort of trust fund, and workers displaced by the robots that are starting to be introduced into our society should be retrained in other areas. I have been pushing this particular thesis for some time. I trust that someone will pick it up and do something about it. As has been stated in this debate, there has been much speculation about tariffs. This plan ends speculation on tariffs in the motor industry. It will be interesting to see the reaction of many in the community to this change to the motor vehicle plan. However, I think the reaction will be good. I trust that those within the industry will see this as a positive step to making certain that Australia is competitive on the world scene and will once again make its mark in the manufacture and export of the motor vehicle. Mr HAWKER(Wannon)(5.03) —I rise to support the words of my colleagues the honourable member for Ryan (Mr Moore) and the honourable member for Cowper (Mr Nehl). In so doing I should like to begin by taking up a couple of points made by the honourable member for Dunkley (Mr Chynoweth). I cannot let them pass without some response. From listening to his speech I got the impression it was all excuses, excuses. He lamented the fact that the price of a car had increased dramatically, as was pointed out by the honourable member for Cowper, and that that big rise in the past five years has occurred under the administration of the present Government. Many of the reasons for the price of cars rising dramatically have already been elaborated upon by the honourable member for Cowper. The rise is roughly twice the increase in the consumer price index for the same period, certainly in the last few years. The honourable member seemed to be accepting this, but lamenting it. He pleaded-in hope, I think, rather than any belief-that the change to the tariff structure might lead to cheaper cars. I do not think he really believes that himself. The simple fact is that a car costs considerably more today than it did when this Government first came to power. There are no excuses. The fact is that most of that increase is due to measures that were brought in by this Government, such as the fringe benefits tax and the effects of high interest rates. I take umbrage at the honourable member's talking about the impact of the steel plan. Much credit has sought to be claimed for the steel plan and what it has done to help the steel industry. I agree that there have been some dramatic improvements in productivity in the steel industry. In fact, in some places, productivity per man employed has roughly doubled. But when one talks to people in the steel industry they admit privately that the biggest impact on saving the steel industry was not the steel plan but the fall in the value of the dollar in 1985. That, more than anything else, saved the steel industry. The honourable member for Dunkley spoke about robots. I suppose robots have a rather interesting psychological impact. I have no doubt that anyone who sees them working is amazed and can quite clearly see that robots take a lot of jobs from human beings. But, really, it is flat earth thinking from the honourable member to suggest that there should be some special tax on robots because they are displacing people involved in those jobs. The increases in productivity and efficiency allow people to have a higher standard of living, and also allow many other jobs to be created in other areas. This has been proved time and again. I cite an interesting example. No-one was heard to suggest that there should be a special tax on tractors when they were introduced into the agricultural industry many years ago, but tractors probably had a far greater impact on employment and productivity in that industry than robots have done to date in the car industry. But tractors also allowed a dramatic increase in the standard of living of probably all Australians. I could go on and give many other examples of what increasing output has done. It has increased the living standards of all Australians. Generally, if handled sensibly, technology has allowed those displaced from industry to find jobs elsewhere. The reason they have not been so successful in the last few years has far more to do with the rigid, centralised wage fixing system that exists in Australia today than the introduction of these various types of new technology. I thought the honourable member for Sydney (Mr Baldwin) was talking utter nonsense when he said that the Government was very concerned about predictability and stability of the car industry, because it was only just after the car plan was introduced that the value of the dollar fell, and to the lowest level in the living memory of most Australians. The honourable member kept on talking about predictability and stability. Interest rates went up to record levels. Things such as the fringe benefits tax were introduced. All of these things had a massive impact on the car industry. Yet three years later we are told that because the value of the dollar fell there is a good argument for beginning to reduce tariffs. I, like all honourable members, am keen to see tariff protection reduced. I still believe there is quite a lot of resource misallocation because of high tariff protection in some secondary industries. It is interesting to note-and I know the Minister for Science, Customs and Small Business (Mr Barry Jones), who is at the table, would agree-that the greatest increases in employment and in production have occurred in manufacturing industries that have the least protection. They also have been the most successful exporters. I shall return to the question of exports and the car industry in a minute. We ought to keep these things in perspective and remember which industries are achieving and which industries are being dragged into the twentieth century. The honourable member for Sydney commended the introduction of `total quality control' and `just in time methods'. They are excellent. We would see far more of them in Australia today if it were not for the recalcitrant unions that are still causing problems in industries, particularly export industries, where time and again an exporter is held over the barrel by a union holding up supplies. The cost to Australia and its markets is staggering if one honestly assesses what is happening. After listening to the honourable member for Sydney quoting figures, comparing costs of cars in 1983 and today, I would have thought he put together an excellent, watertight argument for reducing tariffs to, at the most, 25 per cent and possibly even less. I should like to make a few general comments about the question of industry protection. Despite this car plan, the bottom line is that the consumer has not really benefited. The figures have already been quoted extensively. One of the simplest measures is that it now takes a worker on average weekly earnings another five weeks of work to pay for a motor car compared with 1983. By any measure, this plan still has not achieved what it really set out to do. In that context I want to say something about the importance of looking at an economy-wide approach to industry protection. Too often we have seen situations in which an industry is looked at in isolation and not enough attention is paid to the effect on other sectors of the economy, in particular those sectors that have far less protection. I draw the attention of all honourable members to an excellent discussion paper put out by the Australian Bureau of Agricultural and Resource Economics in February this year headed `Primary Industry Assistance in an Economy-wide Context'. I think this is probably the first time that the Bureau has put out such a working paper, which obviously was very much to the benefit of the Government in its discussions and its deliberations. There has already been some mention of what the Government is doing in regard to industry protection in general. The paper points out a fact that should not be forgotten, and all honourable members should be reminded of it: assistance to the motor vehicle industry and to the textiles, clothing and footwear industry contributes around half of the total effect of all assistance to the manufacturing sector on general price levels and on sectorial returns. In other words, in the motor vehicle industry we are talking about one of our most heavily protected industries. While we welcome the reduction, let us not lose sight of the fact that this is a reduction from a very high level of protection. In fact, if we follow through this paper we will find that the effective rates of assistance calculated by the Bureau show a staggering level of protection for the motor vehicle industry in particular. Even back in 1982-83 the effective rate of assistance was calculated to be in excess of 250 per cent of the value. In 1986-87 that figure is still in excess of 250 per cent. I do not know what the figure will be after this reduction in tariffs but obviously it will still be a highly protected industry by any measure. I do not think we should lose sight of that fact. On the question of protection, much debate is focused on the level of protection that comes through the Budget. Because the Budget and the level of assistance that comes through the Budget are highly visible, it is often easy for people to get the wrong perspective. If we look at the level of budgetary assistance for the manufacturing industry we see that in 1985-86 it was in the order of $320m. It is interesting to compare that with the level of budgetary assistance for agriculture in 1985-86, which was $430m. In fact, if we then look at the net subsidy equivalent of the assistance to agriculture and manufacturing we get a very different picture. Taking the same year, 1985-86, the net subsidy equivalent of the assistance to manufacturing was nearly $6,477m compared to $699m for agriculture. In other words, there was ten times as much assistance for the manufacturing industries as there was for the agricultural industries. I think it is important to make this point: the figures I cited earlier show that if one looks purely at budgetary assistance it would appear that in fact agriculture gets more assistance. However, when one looks at the overall picture one finds a very different story. I would like also to draw the attention of honourable members to an article that appeared yesterday on the front page of the Sydney Morning Herald and which talked about what the Government may or may not be doing in regard to assistance right across the industry range. It really is a quite amazing article. No doubt some of it comes from very good sources. If the article is taken to be correct, the Government is still prepared to hit agriculture far more heavily than it hits the manufacturing industry. I say that particularly in relation to the statement made today by the Minister about a sensible, albeit rather small, reduction in support and tariff protection for the motor vehicle industry. I would like also to touch on the area of export facilitation, about which much was made. The Minister was very quick to talk about automotive exports and how they have increased faster than exports from any other major area of manufacturing. He went on to say that this rate of growth was expected to continue for some time. I draw the attention of honourable members to an excellent publication put out last year by the Centre for International Economics. The main author of the paper, entitled `The Game Plan: Successful Strategies for Australian Trade', was Dr Stoeckel, well known to many people as the former Director of the Bureau of Agricultural Economics. Dr Stoeckel draws some excellent suggestions for improving our exports and our trade performance. In one section he talks about improving exports of motor cars and tells a very interesting little story which I think should be drawn to the attention of all honourable members. He talks about what some of these export incentives really can do, about the so-called manufacturing surge in exports, and about the export of engines, about which we have been hearing and to which the honourable member for Dunkley referred. He went on to say: Australian cars are being exported to Japan-of all places! Perhaps these cars are being driven around by the Japanese but more likely they are sitting in warehouses doing nothing. After all, these cars have already completed a good life's work for their manufacturers, having earned them valuable export credits-credits paid for- I ask honourable members to take note- by Australian car buyers and taxpayers. This may be another reason, of which people may not be aware, why the cost of cars is going up. He goes on: Astounding as this story is, it makes sad sense of a riddle involving our car industry-how can a highly protected industry apparently become so competitive? Our car industry is an industry which can barely compete for Australian buyers even with the help of huge protection and yet it can suddenly take on the world's best, Japan. The explanation is that . . . there is a scheme which can subsidise these exports to the tune of almost 30 per cent of export value. Briefly here is what happens. In Australian car manufacture, 85 per cent of the car components are required to be locally made (the local content scheme); that is pretty hard on Australian manufacturers as local components are expensive by world standards- I see that my time is running out, so I had better get to the point. As Peter Robinson reported in the Australian Financial Review of 7 July last year, if every car exported from Australia is to be subsidised to the tune of $10,000-that is what he has estimated it to be-then the proposed export target of 40,000 units will cost Australia a staggering $400m. I draw that figure to the attention of honourable members because it is significant. Mr DEPUTY SPEAKER(Hon. J. D. M. Dobie) —Order! The honourable member's time has expired. Mr BARRY JONES(Lalor-Minister for Science, Customs and Small Business)(5.18) —I want to respond very quickly to one or two of the points that have been raised. The honourable member for Cowper (Mr Nehl) said that he would like some details by the time the debate concluded about other export programs which are planned or about to be implemented, referred to in my speech. The explanation for that phrase, which perhaps could have been rephrased to advantage, is that the companies involved in the car plan, such as the Ford Motor Co., have their own plans for the export of cars. It is not as though there are secret plans that are not ready for disclosure. I want to make that absolutely clear. I will follow up a couple of other points. It is simply a matter of restating, as the honourable member for Dunkley (Mr Chynoweth) and the honourable member for Sydney (Mr Baldwin) put it, that when we came to office both the motor vehicle industry and the steel industry were in a state of crisis. Their survival was put in question. It is, I think, one of the most significant achievements of this Government that these industries now have considerably stronger long-term projections than they had in 1983. That is true of other areas as well. Obviously the textiles, clothing and footwear industry looks stronger and more viable than it did in 1983. The mid-term report on what we have achieved in passenger motor vehicles since the plan first came into operation in 1984 stands up very well. It must be conceded that there is one fundamental difference in our situation with the motor industry and our export prospects. In the motor industry, Ford, General Motors, Nissan, Toyota and Mitsubishi all have in common brand names not automatically recognisable as being Australian. Nobody seeing a Ford or Mitsubishi motor car driving around automatically says, `Ah! That must be an Australian product'. That is our great difficulty. We lack that sense of Australian identity-the sense of identity that the Swedes have with Volvo, Saabs and Scania trucks. Sweden is a notable example of a country which developed an international reputation for quality, held that reputation, but maintained that sense of national identity. In many areas of manufacturing we need to learn that many nations do not export on price alone. In some ways we have been obsessed with price. We have not done anything like enough to develop the notion of quality and that rather mysterious quality called `reputation'. A tremendous amount of international exporting is done on the basis of reputation, and quality. That is the great lesson that we must teach industry. If we are to survive as a manufacturing nation, it is essential that that lesson be learned and enforced. We have a long way to go. I thank all honourable members for their contributions to this discussion. Question resolved in the affirmative. Motion (by Mr Beazley) agreed to: That so much of the standing and sessional orders be suspended as would prevent the notice lodged by Mr White relating to disallowance of Statutory Rules 1988, No. 17 being called on forthwith. Motion for Disallowance Mr WHITE(McPherson)(5.23) —I move: That the regulation repealing the Australian Rifle Club Regulations as contained in Statutory Rules 1988 No. 17, made under the Defence Act 1903, be disallowed. These regulations which the Minister for Defence (Mr Beazley) seeks to repeal relate to rifle clubs and associations throughout Australia. It is quite clear that the Government wants to weasel out of its responsibilities in relation to these rifle clubs and associations. It is not clear why it wants to do this because no one has provided me with a satisfactory explanation. The fact is that since 1903 the Federal Government has had a responsibility for the supervision of these clubs and associations-some 500 clubs with some 8,000 members throughout Australia. Why the Government would want to abrogate its responsibilities in this regard I simply do not know. For the Government to say in a statement that it is no longer appropriate for the defence organisation to be involved in these affairs seems to me entirely inappropriate. Nothing could be more appropriate to the Department of Defence and the Minister for Defence than to make sure that every effort is made to increase the defence preparedness of the civilian population of this country. If this can be done at practically no cost whatsoever to the Commonwealth, by providing this umbrella of supervision for rifle clubs throughout the country, I would think that was a very sensible way to go. By repealing these regulations, the Federal Government would virtually be handing the control of these clubs and associations back to the States. The Opposition is very much opposed to that and I am pleased to say that the Australian Democrats are also opposed to that course of action. If the repeal of these regulations is not blocked in the House of Representatives, it will almost certainly be blocked in the Senate. It is an abandonment of the Government's responsibilities to hand these clubs back to the States and it is part of a sell-off pattern that in recent years has been typical of this Government's approach to defence facilities and land. The Government has already sold, or is in the process of selling, the rifle range at Williamstown. It is trying to sell the Anzac Rifle Range in Sydney. The New South Wales Rifle Association has taken the Government to court, and rightly so. I understand that it will take some 18 months for that matter to be resolved one way or the other. If I were a developer interested in dealing with the Government over the Anzac Rifle Range, I would be very wary indeed. Also, in relation to the Government's efforts to flog off these ranges the question arises of compensation to those clubs and associations which have their facilities on those ranges. That does not seem to have been decided in any way at all. It is not just a matter of rifle ranges which the Federal Government wishes to dispose of. We have seen the fiasco of the Sydney foreshore land prior to and during the last New South Wales election. The Federal Government would not answer queries on this matter and seemed determined to flog off foreshore land around Sydney Harbour, particularly at Balmoral. It would have been an absolute tragedy if that land had been sold off to developers for a few million dollars in order to fill the Government's coffers. This is prime foreshore land and everyone involved wanted that land to go to the Sydney Harbour National Park. The former Minister for Planning and Environment in the Unsworth Government, Mr Carr-a great protectionist-was strangely mute on the subject. We are all very grateful that Mr Carr is not now in any position to influence events. The new New South Wales Government has made it very clear that it will not participate in rezoning or the provision of services for that land. Perhaps during this debate the Minister will indicate the Government's present approach to that land at Balmoral and to other land that it has been trying to sell in recent times. There is the question of Victoria Barracks in Melbourne and other defence land. The point is that once the Government gets rid of these assets it will never get them back. If the land is not in use at the moment, the time will come when some of it-perhaps not all of it-will be required. Flogging off defence assets in order to get money in the coffers is a disgrace. If these regulations are repealed, as the Government proposes, some of the land on which these ranges are located-some of it is leased land and some of it is owned by the Commonwealth-will be handed over to the States. The States will put pressure on the clubs and the clubs will not be able to sustain that sort of pressure, so for one reason or another the land will become vacant and no doubt it will be sold off as well. I wish to run briefly through the sequence of events of this mess. Order No. 56 was proclaimed to repeal these regulations. It left out any consideration of the small bore shooters and it penalised the owners of semi-automatic and automatic weapons. The Minister does not seem to realise that military shooting is also carried out on these ranges with semi-automatic weapons. These are skills that we want to develop. It is all very well to have a grand academic view of Australia's defence, but the fact is that Australian Army defence is based on one infantry division in which there are six battalions of infantry soldiers as a core force. It is absolute nonsense to try to convince anyone that rifle shooting with single shot, semi-automatic or automatic weapons is a skill which, in the view of the Government, we do not wish to encourage. Why would the Government deny people the facility to improve their skills, to learn to handle arms as an adjunct to our defence preparedness? It is absolutely beyond us on this side of the House why the Government would want to give all of this away to the States. For some reason which no-one understands, the Government has tried to limit ownership to four guns. As far as I know, one can shoot with only one gun at one time. So why does it matter how many one owns? Order No. 56 was obviously a mess. Order No. 66, which was brought forward on 4 March, included the Small Bore Association and lifted restrictions on the four-weapon limit. It also very sensibly lifted restrictions on semi-automatic weapons. But this interim order was issued for only six months to give a breathing space to the rifle clubs and associations before the State governments wished to put the squeeze on them. At the end of six months these bodies were cast adrift. They were given no protection and the whole thing was going to be a fait accompli. I wrote to the Minister asking for some discussions. We attempted to get some discussion going to establish whether there was some good reason for the handover of these clubs or the repeal of the regulations. We would have helped if this had been in the interests of Australian defence, Australian shooters, sensible gun control and people learning how to use weapons. I received no answer. On 24 March I was briefed by two officials. This was after the Australian Democrats had been briefed first in a futile attempt to get them to support the Government on the issue. The Government cannot say that we did not try to come to some reasonable arrangement. I still do not know to this day why the Government wants to get rid of the rifle ranges. It is clearly a Commonwealth responsibility to encourage people to learn to shoot and to handle arms. This is an important adjunct to our defence preparedness. The Minister's academic view of big ticket capital equipment items and his neglect of people and the basic military skills that go to make up a defence force are beyond understanding. For the Government to say that it is no longer appropriate for the Department of Defence or the defence organisation to be involved in rifle ranges is incredible. We have had a long tradition of drawing on skills which have been developed in civilian clubs. We wish to maintain that tradition. We must also address the question of where the defence personnel themselves, the members of the various units who use these rifle ranges, are going to go. It is quite clear that the clubs are not going to be able to continue if the Government repeals these regulations. I would hope that the Government realises that the States have different safety regulations. Their templates are entirely different. In fact, some of them are twice as big as the North Atlantic Treaty Organisation (NATO) standards under which these clubs operate. There is also no doubt that the States, which do not have a defence responsibility, will put the squeeze on these clubs and associations and force them out. Rifle clubs do not have the resources to move. They do not have the money to acquire new land within reasonable reach of their members. People would be discouraged from going to rifle clubs if land were purchased a long way from towns and established centres. The States do not have a national interest in this matter. They do not have a responsibility to make sure that these ranges continue to operate. The NATO regulations which apply to rifle ranges seem to be entirely adequate. I have never heard any complaints that they are unsafe. Why should the clubs be forced into a situation where they cannot exist? There is also a problem in terms of the disparity between States. National associations will have difficulty in conducting national shoots across State boundaries as well as in the transference of arms. I believe that in the context of the current debate on gun laws a very serious problem will arise if rifle ranges cease to exist, and this will happen if they are handed back to the States to administer. People who have been encouraged to join rifle clubs and associations and who wish to shoot-and there are a lot of them-will simply have nowhere to go. They will simply be forced to rampage around the bush as too many people do at present. Would it not be much more sensible to provide facilities and encourage these people to go to clubs and associations and learn to shoot and handle arms properly? Nothing would give us honourable members on this side greater horror than to have to hand over rifle ranges to, for example, the Victorian Government, which is absolutely determined to wipe out anyone who has a sensible interest in shooting. The clubs would be left to the mercy of the Victorian Government. Thank God we have avoided that in New South Wales, which had the same approach until the last election. The then Government realised too late what a fool it was making of itself. The Opposition's aim is to ensure that the clubs and associations are encouraged and maintained. We want to ensure that there are opportunities for people to learn to shoot and handle arms. This is important to our defence effort. We believe that this Government is weak for opting out for reasons which are not clear and which have never been explained. We see this as an important national responsibility. To abrogate that responsibility is to weaken our defence effort, which is weak enough at the moment. Yesterday the Chief of the Naval Staff produced a paper to the Joint Parliamentary Committee on Foreign Affairs, Defence and Trade, which is looking at wastage from the Services. He again said that his operational capabilities have been eroded, that he cannot meet his responsibilities and that he needs another 1,200 men. We know the situation in the Royal Australian Air Force. For example, the fighter squadron in Darwin has seven pilots. The Minister for Defence gave the weak excuse that the rest of them are being trained. I thought that it would have been of fundamental importance to keep the one fighter squadron in Australia up to an operational level while a new one is being trained to take over. Just recently the commander of the 1st Division of the Army asked for 4,000 men. The Minister came into the chamber today and pranced and posed while talking about the Opposition's defence policy on nuclear ships. He would be better off looking to his own responsibilities. It is to his everlasting disgrace that he has never looked properly at the nuclear option. He is frightened that all of that mob in the corner on his side will open up that debate to his detriment. We intend to look at that; we intend to look at it properly. What I have just outlined shows that under this Government the operational capabilities of our defence forces are steadily declining. It is absolutely beyond us why the Government would abrogate a further responsibility for something that is costing us nothing by handing over rifle ranges that are used to develop the basic skills that have been so helpful in past conflicts and in keeping our defence forces strong. We look forward to hearing some explanation from the Minister on this matter. For our part, we intend to oppose the repeal of these regulations. With the support of the Australian Democrats in the Senate, I am sure that that opposition is going to be successful. Mr DEPUTY SPEAKER(Hon. J. D. M. Dobie) —Order! Is the motion seconded? Mr Tim Fischer —I second the motion and wish to speak forthwith in accordance with the arrangements worked out between the Government and the Opposition. Mr DEPUTY SPEAKER —The honourable member for Farrer may proceed. Mr TIM FISCHER(Farrer)(5.39) —I fully support the motion ably moved by the honourable member for McPherson (Mr White). The motion deals with a regulation that was drawn up by the Government as a knee-jerk reaction, as an overkill and as an uncoordinated and ill considered response. Frankly, the Government's regulation is fundamentally objectionable. Having had some experience in the Army, I like to think ahead and anticipate what the Minister for Defence (Mr Beazley) might say when he gets to his feet to respond in a few minutes time. I suppose one of the things that he might trot out by way of response is that the Opposition, by taking this attitude, is trampling on State rights and the rights of the New South Wales, Victoria and other governments to proceed down particular paths with regard to rifle shooting associations and the like. I want to fortify what the honourable member for McPherson said in the course of this debate by quoting parts of our great Constitution. It makes it very clear that the provision of defence rests with the Australian Government. Section 68 states: The command in chief of the naval and military forces of the Commonwealth is vested in the Governor-General as the Queen's representative. Section 69 states: On a date or dates to be proclaimed by the Governor-General after the establishment of the Commonwealth the following departments of the public service in each State shall become transferred to the Commonwealth- Posts, telegraphs, and telephones: Naval and military defence: Lighthouses, lightships, beacons and buoys: Quarantine. Elsewhere in the Constitution it reiterates the Federal Government's fundamental role in defence. What this debate before the House deals with is the acceptance of that responsibility by the Federal Government, albeit the acceptance of what some would contend is a relatively detailed aspect of that responsibility. It is a vital ingredient in our overall defence capability, particularly our Reserve capability, as it provides a practical way in which members of the community can boost their weaponry skills in a realistic, reasonable and practical manner. The Opposition has taken a very responsible approach. We will study with interest what the Minister for Defence has to say. Clearly, the Australian Democrats are thinking about the matter again, as instanced by the Minister's interjection during this debate. He will not know which way the Democrats will jump on this or on any other issue until it actually comes down to the wire in the Senate. I hasten to say that there is nothing new about that. We will see what the Democrats do at the final moment when the equivalent debate takes place in another House. This motion for the disallowance of regulations comes before the House the day after the Victorian State Government caved in on gun laws. The heading `Cain caves in on gun laws' appeared on the front page of today's edition of the Border Morning Mail which is published in Albury-Wodonga in my electorate of Farrer. That is what has happened. The Cain Government in Victoria has finally started to come to its senses regarding gun laws. At the same time as it is coming to its senses, the Federal Government is proceeding with a matter which stemmed from a boil-over reaction to the immediate situation in November and December and the gun summit in December when, suddenly, bureaucrats were asked to cast around for things that the Federal Government could do on the guns issue. The Minister went to his Department-probably fairly quickly-and, as is his wont, probably demanded some option papers and action within the Federal Government scope regarding the gun laws issue which was raging very strongly at that time, and still is, across the community. So the boffins, at some level or other, in the Department of Defence produced this little gem. We have caught the Government out with this little gem. This little gem should be tested on the floor of the House and on the floor of the Senate. It should be discussed, debated, explained and considered on the floor of the House and on the floor of the Senate before the Government is allowed to get away with its somewhat complicated provisions. So complicated were those provisions that, as the honourable member for McPherson pointed out, in the very drafting of them, the Government managed to get it wrong and it had to come back with additional phraseology, additional regulations, to alter the thrust of its original regulations. In terms of the consideration of the guns issue in the Federal Parliament, I wish to place on record the unbelievable reaction in the community at large to removing the right of law-abiding citizens to own a gun, to go to a rifle range and fire a weapon on a Saturday or whenever in proper and safe working conditions, to go recreational shooting and to use a weapon as law-abiding citizens, in a safe and secure way. I think that the Australian Labor Party across the nation, particularly at the New South Wales State level, was so out of touch with its own grass roots and its own blue collar workers that it jumped down the path of this gun issue the wrong way without consulting its own grass roots. Hundreds of blue collar workers in Albury and the capital cities across Australia were absolutely devastated that their Labor Government intended to take unilateral action against law-abiding citizens who wished to be law-abiding sporting shooters in our community. Of course, there has been a proper outcry against the massacres which, sadly, have occurred. I think I would enjoy the support of all honourable members in deploring the use of guns on aircraft in hijacking situations, which are absolutely horrific and deserve universal condemnation. Mr Peter Fisher —Both of the weapons that were used were illegal. Mr TIM FISCHER —The weapons used in the Hoddle Street massacre were illegal under existing legislation. That shows that the laws that were in operation at that time were not impacting on the situation which unfolded in the horrific Hoddle Street massacre. In many ways, the whole attitude of the Federal Labor Government, the ex-New South Wales State Labor Government and other Labor governments on guns has been out of touch with the grass roots and the reasonable thinking, law-abiding citizen, be he a blue collar worker, a white collar worker or an elector in the electorate of Cook, Farrer or beyond. I think that it is germane to quote in this context what Senator Richardson said on 21 March 1988. He said that the Labor Party had `forgotten what the common people are all about'. He said, `We don't understand them any more'. That is what Senator Richardson said about the Labor Party. On the same day, former Premier Unsworth said: I suppose if they- that is, the working class- see their leadership dressed in black tie, smoking cigars, hobnobbing with representatives of capitalism, they might question where the party is going. A member of this House, who is having difficulty in finding this House of late-I refer to a former Minister of the Crown-said on 21 March 1988: The perception is that too many people have been extraordinarily arrogant, and it's not just people in Cabinet, including Hawke himself. A little humility would go a long way. There's too many egos. Too many politicians think they're invincible. Who the hell do they think they are? The honourable member for Robertson (Mr Barry Cohen) gave that little gem to the community at large. Mr White —That was when he was an ex-Minister. Mr TIM FISCHER —As an ex-Minister and present backbencher, he is now deliberating on his resignation date from this Parliament. What all those quotes demonstrate, and I think that they are relevant to this debate, is that the Labor Party is so out of touch that it failed to recognise the proper and legitimate aspirations of its own grass roots supporters with regard to being able to exercise properly their right to go sporting shooting should they desire to do so and their right to carry on normal activity as law-abiding citizens. I am pleased to say that I helped to organise and participated in one of the largest ever public meetings held at Albury which saw some 2,000-plus citizens reject totally Labor's approach on gun laws, both State and Federally. I might add that the massive swings against State Labor members in southern New South Wales were greatly related to the guns issue and cost the Labor Party the seats of Albury, Burrinjuck, Monaro and Bega-to name just four seats. I accept that in acting on this issue it is not just a matter of straight political gain or otherwise. That should be only a part of the consideration of the Government and the Cabinet. The whole priority surely should be to get the right approach with regard to gun laws. So the Government called a national summit on this issue and there was State and Federal participation. The approach the Federal Government took at that national summit was united and co- ordinated. That is what the Government was seeking at that meeting in December. At the same time, it has now gone down the path with these regulations of a quite contrary approach, to push emphasis back to the State level with regard to rifle club associations, the ranges, safety and template requirements and the like, and to provide a variation of approach which could be six different approaches at the State level with no consistent national approach. So the Government, with these regulations, is doing the very opposite of what it set out to do last December when it sought national consensus and a national approach on gun laws. The House and the nation should be aware of that and the Minister should address that in his response to this disallowance motion before the Parliament. The Government, in hindsight, would have liked not to have proceeded with this regulation. The Government is somewhat embarrassed, particularly with the Cain Government caving in on gun laws, at now having to defend its regulations especially as it might now recognise that not only will that wreck a consistent national approach, but, as the honourable member for McPherson has properly mentioned, it will further reduce our defence capability in a very practical and meaningful way. For those reasons I second the motion ably moved by the honourable member for McPherson. I believe that the House, in the absence of any concrete information put by the Government to the honourable member for McPherson, should take this action as part of a responsible approach to getting the right gun laws in place at the State and Federal level and to getting the right regulations in place under the Defence Act. It should be absolutely certain that the gun law outcome will be satisfactory and that the regulations finally determined are determined by this Parliament and relate to the requirements of the community at large. Mr BEAZLEY(Swan-Minister for Defence)(5.53) —We oppose the suggested repeal of the regulation that we have brought into being. As usual in these situations where regulation is involved it seems that the Opposition has not necessarily thought through all the implications for the people whose interests it is supposed to be defending when it presents its arguments. It is another case of the Opposition yet again wandering off half-cocked on a defence matter, wishing to make a point without having a systematic study of the problem. The Opposition spokesman on defence, the honourable member for McPherson (Mr White), did not realise how ludicrous he was when he criticised me for having an interest in the equipment of our armed forces, suggesting that this distracted me from the minutiae I ought to be concerned with, at the same time that he was loudly advocating that we really need to get into billion dollar nuclear-powered aircraft carriers and cruisers. There is area for argument but it is a slightly ludicrous juxtaposition. A further ludicrous comment from the representative of the National Party who spoke in this debate on the basis of a 20 per cent swing against his Party, lecturing us on whether we were in touch with the grass roots. We have suffered no 20 per cent swings against us. Mr Tim Fischer —Are you forgetting Adelaide and Port Adelaide? Mr BEAZLEY —There was not a 20 per cent swing in Adelaide. The National Party put up an argument on the basis of having just witnessed that appalling charade in Melbourne when the Liberal Party spun on the spit of trying to rid itself of the overweening influence of its millionaire mate-which it simply cannot do. Harold Wilson once said that a week is a long time in politics. The last two weeks have indicated aptly the very sound warning of Harold Wilson to politicians when they contemplate their future in the long haul. Several points need to be made. Historically, rifle clubs were treated as part of the defence resource at the time these regulations initially were brought into being. That happened for a very simple reason. At that time rifle clubs were given a specific defence task. They were not used to train people to shoot but the people were employed as vulnerable point guards and as cable guards. There was a direct relationship between a particular defence function and the functions of rifle clubs. As, over time, rifle clubs came into a position of obviously being sporting associations-and we do not condemn them as sporting associations; we support them-governments considered that supporting them was no longer appropriate. The most dramatic step to this point-and this was only the final step in a process initiated then-occurred in 1959 under the Menzies Government when that Government decided that a process of disengagement and progressive removal of Commonwealth support of rifle clubs should begin. This was not advice based on a response to what the Premier of Victoria might have been doing at the time had the Menzies Government looked at that; it was a result of advice from the professional military to the Menzies Government that this is what should occur. The professional military said that the rifle club movement had no defence value. Whatever value it may have had in terms of sporting activities-where I think it has very great value-as far as the Department of Defence was concerned, and as an absorber of defence resources, the military in 1959 said to Menzies, `The clubs have no defence value'. So Menzies started to put in process the uncoupling of Commonwealth defence support from the rifle clubs. The Menzies Government decided to withdraw direct financial support from the rifle club movement and to separate rifle clubs from Commonwealth association. That separation was to be achieved by 1965. In 1962 the Government only partially reversed that earlier decision and agreed to an association on a revised basis. Since the late 1970s there have been further moves towards disengagement of the rifle club movement from the Commonwealth. Agreement was reached for repeal of the Australian Rifle Club Regulations leaving the movement responsible for its activities under the framework of the National Rifle Association of Australia. All these activities have been taking place under the auspices of Liberal governments on the advice of their military advisers. The military advisers told them at the time that it was not appropriate under the Defence Act for these activities to continue. The Opposition needs to contemplate that. It also needs to contemplate the position that has been achieved since then because unfortunately considerable misnomers operate among our rifle clubs and in the Opposition as to the legal protection that rifle clubs now have. Rifle clubs effectively have been operating outside the framework of strict Commonwealth approval, under this legislation. There is and has been to this point goodwill on the part of Commonwealth and State authorities and individuals such as nearby residents who may be affected by rifle club activities. Ours is not a litigious society. No-one has sought to challenge the implications of the fact that the Commonwealth is not enforcing regulations but is having them effectively enforced by the process I have outlined-that is, the generous attitude that the Commonwealth has had to the issue of enforcement. I suppose in the contemporary atmosphere it is possible for State governments and citizens to call enforcement into question. If it is called into question, the possibility is that individuals will be at risk. I am sure that none of us would want to see that situation develop. Fortunately, the regulations we have introduced, which provide for that interim arrangement, have cured that situation. I shall take this matter a point further because I am sure members of rifle clubs do not understand the exemption. In both the generous and the strict interpretations, exemption from State licensing requirements means just that: an exemption from State licensing requirements. If weapons prohibited by the States are held by a rifle club member no exemption exists. That matter is not well understood among members of rifle clubs, and they will be afforded no protection in that regard. The Opposition has raised the matter of templates associated with the operation of the ranges. That issue is not caught up in this debate. I happen to have considerable sympathy for the view of rifle clubs so far as the templates that would be imposed upon them are concerned. Rifle clubs are not, however, protected by this particular ordinance so far as that matter is concerned; they are protected by other interests of the Commonwealth. I am willing to use what authority the Government has to protect the interests of rifle clubs concerning templates. In relation to this and other associated matters, before they are considered in the Senate, I am prepared to have discussions with rifle clubs. In the course of action proposed by the Opposition, rifle clubs are potentially placing themselves at risk. This is an area of legislative mess which, after that initial pristine pure decision, if you like, by the Menzies Government to uncouple the relationship and the development of appropriate regulations associated with them, the various compromises that have been arrived at have put rifle clubs in a position whereby they would be at some degree of risk if a nasty-minded individual were to seek to deal with this matter in legalistic fashion. I am willing to discuss with rifle clubs in good faith how their various problems in this regard may be overcome. I do not believe the problems will be overcome, but were the Opposition to have its way in the Senate, in a contemporary environment the fat might well be in the fire. The disposal of ranges is a decision, unrelated to these matters, that the Commonwealth can make at any time it desires, whether or not the regulations are in place. However, that does not mean that such decisions are arrived at easily. The Government is prepared to get rid of ranges in cases when it is appropriate to do so. According to the Opposition's defence spokesman, the Department of Defence may not rid itself of any unwanted property. This is now the position of the Opposition spokesman. That is an unusual stance to take, particularly as his Leader wanders around the place saying, `Yes, of course we will rationalise Commonwealth functions. Yes, of course, we will dispose of Commonwealth assets that we do not need'. When one bears in mind that the Department of Defence is responsible for, I understand, about 80 per cent of Commonwealth-owned property, it seems a bit of a nonsense that on the one hand the Leader of the Opposition says, `We will go through Commonwealth assets with an efficient broom and rid ourselves of things we do not need', and on the other hand the Opposition spokesman on defence, who technically would be responsible for about 80 per cent of those assets, wanders in here and says, `Look, we will not get rid of any defence land because you never know when you may need it'. It creates something of a problem. The Leader of the Opposition (Mr Howard) has his problems with his front bench; we all understand that. They have to be gagged every now and then when they spout forth. After all, the shadow Minister for Defence is a rotating Minister, and if he makes a few commitments between now and when he is rotated in June, perhaps it will not matter that much. He can liberally commit himself to never getting rid of a defence asset, at great cost to the Commonwealth; he can liberally commit himself to buying nuclear powered aircraft carriers. He can do all these sorts of things, and I suppose it does not really matter if he disappears off the political scene two years in advance of the next election. Of course, if the Leader of the Opposition intends to keep the shadow Minister, he will have problems with that substantial list of commitments. I have indicated that I will make available the representative of the defence function in the Senate to discuss with rifle clubs the various problems that are associated with this. It is not our intention to discourage in any way a legitimate sporting activity associated with weapons. This is simply not a defence function. Prime Minister Menzies did not think it was back in 1959, nor did his military advisers. We are finishing off the process that Menzies began. I move: That the question be now put. Question resolved in the affirmative. Original question put: That the motion (Mr White's) be agreed to. The House divided. (Mr Deputy Speaker-Hon. J. D. M. Dobie) Ayes . . . . . . . . . . . 53 Noes . . . . . . . . . . . 67 —— Majority . . . . . . . . . 14 —— Adermann, A. E. McGauran, P. J.Aldred, K. J. MacKellar, M. J. R.Andrew, J. N. (Teller) Macphee, I. M.Beale, J. H. Miles, C. G.Blunt, C. W. Millar, P. C.Braithwaite, R. A. Moore, J. C.Burr, M. A. Nehl, G. B.Cadman, A. G. Peacock, A. S.Cameron, Donald Porter, J. R.Cameron, Ewen Pratt, M. P.Cameron, Ian Prosser, G. D.Cobb, M. R. Reith, P. K.Connolly, D. M. Robinson, IanDowner, A. J. G. Rocher, A. C.Edwards, Harry Shack, P. D.Fife, W. C. Sharp, J. R.Fischer, Tim Sinclair, I. McC.Fisher, Peter Smith, W. L.Goodluck, B. J. Spender, J. M.Halverson, R. G. Sullivan, K. J.Hawker, D. P. M. Tuckey, C. W.Hewson, J. R. Webster, A. P.Hicks, N. J. (Teller) White, P. N. D.Hunt, R. J. D. Wilson, I. B. C.Jull, D. F. Woods, R. L.Lloyd, B. Wooldridge, M. R. L.McArthur, F. S. Baldwin, P. J. Jakobsen, C. A.Beazley, K. C. Jenkins, H. A.Beddall, D. P. Johns, G. T.Bilney, G. N. Jones, BarryBlanchard, C. A. Kelly, R. J.Blewett, N. Kent, L.Brown, Robert Kerin, J. C.Brumby, J. M. Kerr, D. J. C.Campbell, G. Klugman, R. E.Charlesworth, R. I. Lamb, A. H. (Teller)Chynoweth, R. L. Langmore, J. V.Cleeland, P. R. Lee, M. J.Courtice, B. W. Lindsay, E. J.Crawford, M. C. McHugh, J.Cross, M. D. Martin, S. P.Cunningham, B. T. (Teller) Mildren, J. B.Darling, E. E. Milton, P.Dawkins, J. S. Mountford, J. G.Dubois, S. C. O'Keefe, N. P.Duffy, M. J. O'Neil, L. R. T.Duncan, P. Price, L. R. S.Edwards, Ronald Sawford, R. W.Fatin, W. F. Scholes, G. G. D.Fitzgibbon, E. J. Sciacca, C.Free, R. V. Scott, J. L.Gayler, J. Simmons, D. W.Gear, G. Snow, J. H.Gorman, R. N. J. Snowdon, W. E.Griffiths, A. G. Staples, P. R.Hand, G. L. Theophanous, A. C.Harvey, E. R. Tickner, R. E.Holding, A. C. West, S. J.Howe, B. L. Wright, K. W.Humphreys, B. C. Ruddock, P. M. McLeay, LeoShipton, R. F. Uren, T.Katter, R. C. Hayden, W. G.Brown, N. A. Lavarch, M. H.Cowan, D. B. Grace, E. L.Carlton, J. J. Morris, AllanHall, Steele Morris, PeterHoward, J. W. Hawke, R. J. L. Question so resolved in the negative. Bill presented by Mr Kerin, and read a first time. Mr KERIN(Werriwa-Minister for Primary Industries and Energy)(6.16) —I move: That the Bill be now read a second time. This Bill is an omnibus Bill for legislation administered within the primary industries and energy portfolio. Its introduction will facilitate the passage of amendments to existing legislation. The Bill contains minor typographical and administrative amendments to the Administrative Decisions (Judicial Review) Act 1977, Dairy Produce Act 1986, Pig Industry Act 1986 and Rural Industries Research Act 1985; and repeals a redundant Act, the Dairy Industry Act 1967. These amendments will be self-evident and are sufficiently explained in the explanatory memorandum circulated with the Bill. I propose to confine my comments to addressing the more significant changes which will be made by the Bill. Canned Fruits Marketing Act 1979-Repeal Canned Fruits Levy Act 1979-Repeal Canned Fruits Levy Collection Act 1979-Repeal The Bill provides for the repeal of the Canned Fruits Marketing Act 1979 and two associated Acts, the Canned Fruits Levy Act 1979 and the Canned Fruits Levy Collection Act 1979. These amendments were foreshadowed in September 1987 in the announcement of the Government's decision on the Industries Assistance Commission Interim Report on Canned Fruit (Statutory Marketing and Interim Assistance Arrangements). Under the Canned Fruits Marketing Act, the Australian Canned Fruits Corporation is empowered to acquire canned deciduous fruit produced in those States where complementary State legislation exists and to market the acquired product in Australia and overseas. In addition, the Corporation operates a pooling scheme whereby returns from gazetted pool markets are equalised and an equalised return is paid to canners. The Government considers that the canned fruits statutory marketing arrangements have served their purpose of bringing about a degree of stability to the industry. However, the industry now needs to adjust further to changing market circumstances, and the repeal of the legislation will allow for necessary structural adjustment and encourage more innovation. In reaching its decision to wind up the Corporation, the Government has also taken into consideration the possible future relationship of the canned deciduous fruit industry to the Australian Horticultural Corporation, for which legislation has recently been passed. The Government believes that certain functions currently performed by the Australian Canned Fruits Corporation could be transferred to the Australian Horticultural Corporation either directly or on a fee for service basis. These are matters to be decided upon by the industry. Australian Meat and Live-stock Corporation Act 1977 The purpose of this amendment to the Australian Meat and Live-stock Corporation Act is to make clear that shipping lines involved in the carriage of meat or livestock on behalf of licensed exporters do not themselves need to hold a meat or livestock export licence. Whilst this has always been the understanding and intention of the legislation, recent legal advice to the Government has indicated that the matter is not beyond doubt and that clarification is therefore desirable. The amendment maintains the status quo, and has the support of the Australian Meat and Live-stock Corporation. Export Control Act 1982 The amendments will restrict `authorized officers' to persons appointed under section 20 of the Act, will put beyond doubt the power of an authorised officer to take photographs or video tape recordings as evidence of a breach of the Act, will permit the regulations to impose penalty for non-payment of fees and will clarify that the orders can impose penalty for the non-payment of fees but cannot impose penalty for offences against the orders. Fishing Industry Research and Development Act 1987 This amendment is to place beyond doubt the power of the Fishing Industry Research and Development Council to enter into arrangements with the Department of Primary Industries and Energy for the provision of, and payment for, clerical and administrative services. Meat Inspection Act 1983 The amendments will permit the regulations to impose penalty for non-payment of fees, will put beyond doubt the power of an authorised officer to take photographs or video tape recordings as evidence of a breach of the Act and will clarify that the orders can impose penalty for the non-payment of fees but cannot impose penalty for offences against the orders. Minerals (Submerged Lands) Act 1981 The Minerals (Submerged Lands) Act 1981 provides for a regime to allow exploration for, and exploitation of, minerals from the seabed. Administration of this regime will be shared between the States, the Northern Territory and the Commonwealth in accordance with the Offshore Constitutional Settlement of 1979. Although passed in 1981, proclamation of the Act has been held up pending the passage by the States and the Northern Territory of complementary legislation which is necessary before a common regime covering offshore minerals activity can be established. The purpose of this amendment is to remove the current requirement that the States and the Northern Territory pass legislation to authorise their respective Ministers to carry out the day to day administration of offshore minerals activity under the Act. Instead the States and the Northern Territory will be able to authorise their Ministers by administrative action. The Commonwealth has received expressions of interest from companies seeking to explore the seabed for minerals beyond the three nautical mile territorial sea and the Government does not wish to unduly delay exploration pending the establishment of a common offshore minerals regime. The Commonwealth is therefore considering proclaiming only those portions of the Act as will be sufficient for a regime covering exploration. Once the complementary States and Northern Territory legislation has been enacted the Commonwealth will proclaim the remaining portions of the Act. Plant Variety Rights Act 1987 Subsection 3 (1) and 3 (7) will be amended to change `public knowledge' to `common knowledge'. The concept of public knowledge requires only one person to know about the new variety whereas common knowledge infers that the variety is known within the trade, that is, by experts in the field. This change is in line with the intent of the Act and will more closely reflect actual practice. Common knowledge is used in plant variety rights legislation overseas and in the International Convention of the Union for the Protection of New Plant Varieties. Australia will now conform to international practice. Section 46 of the Act will be amended to remunerate all part time members of the Plant Variety Rights Advisory Committee equally. Under the current legislation only two of the six part time members receive Remuneration Tribunal allowances and remuneration. The others receive only Senior Executive Service travel allowances. This is clearly an anomaly as the members all contribute equally to the working of the Committee and were appointed for their expertise and experience in areas specified by the Act. The extra cost involved will be $3,000 per annum, which can be absorbed in the current appropriation. Wool Marketing Act 1987 Wool tax, paid by woolgrowers into the Market Support Fund, administered by the Australian Wool Corporation for the operation of the wool reserve price scheme, is refunded when market circumstances and the amount in the fund allow. The Bill provides for the Commissioner of Taxation to provide specific information to the Australian Wool Corporation to facilitate the payment of the refunds of wool tax to woolgrowers. These provisions effectively reinstate two paragraphs from the part dealing with refunds in the now repealed Wool Industry Act. It was the original intention that all the administrative procedures relating to refunds should be included in Wool Marketing Regulations. However, advice from the Attorney-General's Department was that delegated legislation could not confer powers over another Commonwealth body. Accordingly these provisions are to be reinstated in the Wool Marketing Act, with the concurrence of the Treasurer (Mr Keating). Wool is expected to be Australia's major export income earner in 1987-88. To preserve the market dominance of Australian wool and its competitiveness relative to other fibres, everything possible must be done to ensure that wool sold for export meets the quality requirements of buyers. The Australian Wool Corporation has powers under section 74 of the Wool Marketing Act 1987 relating to quality assurance. These provide for the Corporation to prevent the sale, at export auction, of wool which does not meet industry standards. This includes wool which contains unacceptable levels of pesticide residue and wool which has not been classed by a registered wool classer. These powers are limited to the sale of wool at export auctions and do not cover the 20 per cent of the woolclip which is sold outside the auction system. They are also inconsistent with the Corporation's power under section 63 to formulate and secure the adoption of industry standards and terms for the sale of wool at auction or otherwise. Therefore, the amendments will bring the Corporation's powers under both sections of the Act into line and enable it to prevent the sale of wool contaminated with pesticide residues, for export, by private sale as well as through the auctions system. These powers are necessary to ensure that the international reputation of Australian wool is maintained. The Attorney-General's Department has advised that the present penalty provisions of the Wool Marketing Act and Wool Marketing Regulations are ineffective with respect to the prosecution of corporations. Accordingly the corporate knowledge provisions to the Bill, based on those of section 84 of the Trade Practices Act 1974, have been developed to enable successful prosecution of corporations. Section 127 of the Wool Marketing Act provides for regulations to be made in relation to registration of wool test houses, but not for their inspection. The lack of any legislative authority to inspect test houses, for the purpose of registration or to ensure compliance with approved procedures, could jeopardise the confidence of buyers in the integrity of Australian wool testing and description, with adverse effects on our wool export trade. A regulation making power providing for inspection of wool test houses will therefore be inserted in section 127 of the Act. I commend the Bill to honourable members and present the explanatory memorandum to this Bill. Debate (on motion by Mr Shack) adjourned. Bill presented by Mrs Kelly, for Mr Howe, and read a first time. Mrs KELLY(Canberra-Minister for Defence Science and Personnel)(6.28) —I move: That the Bill be now read a second time. Over the last two years this Labor Government has embarked on a program of major improvements in the quality of administration and decision making in the social security portfolio. This program has dual objectives: to ensure that every Australian resident obtains adequate income support as and when it is needed; and to protect the revenue by ensuring that payments are not directed to those who do not require them. This program has involved major legislative change and significant new administrative arrangements. There is no area which more fundamentally shows the difference in approach between this Labor Government and the conservative Opposition. Our approach has been, as Professor Fred Gruen recently noted, to `square the circle'. We have substantially increased the real level of pensions, benefit and allowances while reducing the level of social security expenditure as a proportion of gross domestic product. We have done this through close attention to the detail of the administration of each program to maximise the accuracy of social security decision making. When in Government the conservatives proved themselves incapable of this form of development. In opposition the conservatives have confirmed their approach. They would reduce social security expenditure-but how would they do it? They would do it by wholesale cutting of programs-by denying help to those who need it. They would terminate eligibility for sole-parent pensions when the youngest child turns 10. They would make people who resign a job wait for six months before paying any benefit. They would not pay benefit to sacked people for lengthy periods, not until their redundancy payments were exhausted. These measures are exactly the sorts of steps this Labor Government will not take. We will continue to improve the standard of living of all those residents of Australia who cannot adequately support themselves. We will do this, while protecting the taxpayers of this country from excessive burdens, by close, hard detailed examination of social security programs and administration. This Bill is a further step in our program of improving the quality of administration and decision making in the social security system. Last year this Labor Government introduced the family allowance supplement as part of our attack on child poverty. Under this Bill the administration of the family allowance supplement will be improved by refinements to the treatment of lump sums under the income test. People who take leave from employment and are paid in a lump sum rather than during the period will have their payments spread over the period of leave. At present the family allowance supplement may be forfeited if the lump sum is treated as income within the period of receipt. This disadvantages those who receive leave payments in a lump sum compared with those whose leave payments are staggered by their employers. Lump sum education payments will also be spread over the period to which they relate. Sitting suspended from 6.30 to 8 p.m. Mrs KELLY —A measure will be introduced to protect student parents who, in 1988, were not aware of their family allowance supplement entitlements until they received education payments. As the education payments may be made in respect of an earlier period, family allowance supplement will be payable to cover this earlier period of entitlement. To obtain these arrears of family allowance supplement the student parents must claim family allowance supplement within six weeks of receipt of the education payments. Improvements will also be made to the parental income test on job search allowance. The year of parental income that is tested will be moved forward to the year ending in the month of June in the previous financial year rather than the month of June in the previous calendar year. This will assist in ensuring that the level of payment is more closely aligned to real need. Where a parent is a social security recipient the parental income test will not apply. This Bill contains measures to improve the administration and integrity of compensation recovery provisions. Where a person receives personal injury compensation that makes up for lost income the Social Security Act provides that pension or benefit may be reduced or recovered. This is one way in which social security expenditures are directed to those most in need. Settlements of lump sum compensation particularly in the workers compensation jurisdiction are being manipulated to obscure the economic loss component and to avoid recovery of social security payments. To prevent this abuse the Minister announced on 8 February 1988 that, for future personal injury settlements made by agreement or by consent order, 50 per cent of lump sum compensation will be deemed to be in respect of economic loss. This Bill gives effect to that proposal. Where, on the other hand, a court has made an order after a contested hearing specifying the economic loss component, the Secretary to the Department will continue to have regard to the characterisation given to the award by the court. To improve consistency in the treatment of income of social security recipients the Bill proposes to exempt German restitution payments from the definition of income under the Act. This will ensure that payments from West Germany made by way of compensation for nazi persecution are not treated as income. Only those payments expressly paid for lost income will continue to count as income. The rules preventing payment of arrears of sickness benefit to those who have failed to lodge their claim within the necessary time limits will be modified to accommodate those whose incapacity has prevented them from lodging their claim in time. Up to four weeks arrears from the date of claim will be payable in such cases. This will ensure that the very ill have access to four weeks arrears just as those who are able to claim shortly after the date of their incapacity. In recognition of the care required by a disabled child who attracts child disability allowance, a sole parent will not lose his or her entitlement to sole parent's pension when that child turns 16 years of age. Other measures contained in this Bill clarify provisions in the Social Security Act or close gaps remaining from amendments enacted last year. Asset limits for married beneficiaries under the benefits assets test have been clarified. Previously the benefits assets test for a married beneficiary was linked to the pension assets test. Where only one spouse was in receipt of benefit but claimed additional benefit for a dependent spouse this resulted in a limit that was half the combined married limit. The assets limits in these cases will now be twice the sum available to each individual spouse under the pensions assets test. The residence requirements for children who attract additional pension and benefit for their parents have been adjusted to reflect the particular residential status of special beneficiaries and non-Australian residents with portable pensions. Sickness beneficiaries or their spouses who temporarily leave Australia, for example to seek medical treatment abroad, will be permitted to continue to receive sickness benefit or to attract additional benefit for up to three months of their absence. Finally, to complement the introduction of supported employment services under the Disability Services Act 1986, sheltered employment allowance will be available to disabled people who are employed in these services. The Social Security Act is amended regularly in the interests of good administrative practice and to improve the efficiency of the services provided to clients. This Bill will ensure that these aims continue to be served. I commend this Bill to the House and present the explanatory memorandum. Debate (on motion by Mr Porter) adjourned. Bill presented by Mrs Kelly, and read a first time. Mrs KELLY(Canberra-Minister for Defence Science and Personnel)(8.05) —I move: That the Bill be now read a second time. The purpose of this Bill is to enable the application to members of the Defence Force of the 3 per cent productivity superannuation benefit. This benefit flows on from the June 1986 decision of the Australian Conciliation and Arbitration Commission on this subject. Because there are complex superannuation issues involved in the application of the benefit to the government employment area the final form of the benefit has not yet been decided. In applying the Conciliation and Arbitration Commission's decision to the Public Service and to the Defence Force it was found that, because of factors peculiar to the Defence Force, there would need to be differences in matters of detail in the application of the scheme to the Defence Force and the Public Service. These differences include: There is only one `employer'-if I may use that expression-for the Defence Force as distinct from the many employers in the Public Service sector. The Defence Force scheme does not apply to part time service. The Defence Force scheme has to have regard to concepts in the Defence Force Retirement and Death Benefits Act 1973 which differ from those in the Superannuation Act 1976. The Defence Force scheme has to have regard to the conditions of service peculiar to the Defence Force. The Defence Force has a centralised pay system. As the scheme is an interim one and will shortly be replaced by a permanent scheme, it is proposed to empower the Minister for Defence to determine details of the scheme and to provide that any determinations made by him are to be subject to the usual tabling and disallowance provisions of the Acts Interpretation Act 1901. The Bill sets out guidelines that the Minister will be required to have regard to in making a determination. These are: the decision of the Conciliation and Arbitration Commission, the scheme for the Public Service as set out in the Superannuation Benefit (Interim Arrangement) Bill 1988, the terms and conditions of service of members of the Defence Force and the arrangements for the administration of the Defence Force. Financial Impact Statement It is estimated that the introduction of this benefit for the Defence Force will result in the following expenditure by the Commonwealth: Financial year...Expenditure 1987-88...$0.470m 1988-89...$4.550m Expenditure in subsequent years will depend upon the final form adopted for the benefit. I commend the Bill to honourable members and present the explanatory memorandum to the Bill. Debate (on motion by Mr Porter) adjourned. Debate resumed from 16 March, on motion by Mr Barry Jones: That the Bill be now read a second time. Mr MOORE(Ryan)(8.09) —The Excise Tariff Proposals Nos 7 to 10 (1987) and Customs Tariff Proposals Nos 14 to 17 were introduced in September last year. It has always been a bit of a mystery as to why they were not dealt with on the one occasion; they are still going on in bits and pieces. The Excise Tariff Amendment Bill 1988 relates to the oil market and the excise on liquefied petroleum gas (LPG) and avgas. In the case of the oil industry, the Government moved to a deregulated crude oil market from 1 January 1988. As a consequence of this the six-monthly adjustments to the consumer price indexed excise will be removed. As a move to that position the adjustments made in October and December 1987 will be the last associated with the indexed excise payment. From here on in the Government will move to collect its excise at the consumer rather than the producer end. I hope this does not mean that the garage proprietors, operators or lessees of Australia will become yet another government taxing base. I well remember the Treasurer (Mr Keating) talking about the tax gathering potential of this legislation when it was first introduced. I have not noticed any propensity on the part of the Government to reduce any of these taxes. In fact it indexes them every six months in order to give them a good kick along. The recollection process of the Government on other occasions is somewhat amiss. In relation to the changes in this legislation, it is interesting to note that the Minister for Primary Industries and Energy (Mr Kerin), making some observations about oil pricing in Australia, recently said that he hoped for some reduction in `our phenomenal petrol prices'. I say, `Hear, hear!', as will every motorist, every rural user and every commercial user of oil and petrol products in Australia. They will welcome that move enormously. But there is no reason to assume that under the current arrangement that will be the case, unless the world price of oil deteriorates very sharply. Oil prices are still subject to the Prices Surveillance Authority. I remember that when the Prices Justification Tribunal was about-a legacy of the Whitlam days-I moved to abandon that particular body. However, the then Minister responsible said, `Oh no, we cannot do that, we have to have an authority'. A number of price changes were quarantined in order to establish this Authority. I doubt whether the Authority's ability to judge oil prices today is any better than it was in those days. Trying to weigh up the accuracy of some of the statements from representatives of the oil industry is quite a job. The second part of the legislation concerns the excise paid on liquefied petroleum gas. Here there is a change in the pricing policy because import parity pricing is no longer to be related. Instead there is to be a weighted average of the prices received for exports and local sales of LPG during the preceding six months. Again, this means an increase of about $8.19 a kilolitre. This increase in excise rates is expected to raise an additional $9.5m to the Government's surplus. That is not too bad, considering that the previous adjustment changeover yielded $55m. The third part of the legislation relates to aviation gasoline-avgas. In this case negotiations were carried out between the aviation authorities and the users of light aircraft in the general aviation area to effect an increase in the price of avgas rather than to pay the landing fees normally attracted by this area. This proposal is identified with the airports at Essendon, Coolangatta and Launceston and the change took effect from 1 January 1988. It is an agreement between the Government and the general aviation sector as it relates to those three airports and adds an extra 0.5c per litre at the bowser for avgas. Obviously, general aviation users do not use the resources that are pertinent to major airports such as Mascot and Tullamarine. I am glad that the Minister for Transport and Communications Support (Mr Peter Morris) has acceded to this desirable request because it makes a lot of sense. I have been asked particularly to note that the Launceston Aero Club is still concerned about this matter because it appears that in its area negotiations have not come to fruition at this time. The Opposition will not oppose the proposals in this legislation. Mr BEDDALL(Rankin)(8.14) —I rise in support of the Excise Tariff Amendment Bill 1988. This Bill addresses four major areas of the petroleum product industry. These are: excise duty on liquefied petroleum gas (LPG); excise on aviation gasoline (avgas); import parity price adjustments; and limitation of excise indexation to around 6 per cent. The Bill amends the Excise Tariff Act of 1921 and implements the Government's policy of deregulation of the petroleum industry. It is important as a background to this Bill to reflect on the impact on petroleum product prices and excise rates since the deregulation of crude oil marketing. The excise rate for naturally occurring LPG is adjusted six monthly on 1 April and 1 October each year in accordance with the Government's previously announced LPG excise policy. The formula used to calculate the rate is based on the six monthly weighted average of prices received for export and local sales of LPG. The excise rate is set at 60 per cent of the amount by which the realised price for naturally occurring LPG exceeds $147 a tonne, expressed as a rate per kilolitre. The increase in the excise rate reflects higher export prices for LPG for the relevant six monthly period-that is, for the October 1987 adjustment, this was the period from 1 March 1987 to 31 August 1987. The increase in the excise rate from 1 October 1987 reflects higher export prices for LPG. The Saudi Arabian Government's selling price for propane, on which Australian export prices are based, was increased by $US10 to $US125 a tonne on 1 March 1987 and has remained at that level over the pricing period. This increase in the excise rate is estimated to lead to an increase of $9.5m in excise receipts on the production of naturally occurring LPG in 1987-88. Following consultations with the major general aviation associations early in 1987, the Government introduced in July last year revised general aviation avgas aircraft charging arrangements in the form of a fuel excise surcharge. The major industry associations unanimously supported this charging arrangement. The fuel excise surcharge was applied to all general aviation avgas operators, irrespective of the airport at which they landed. In addition, such operators faced a landing charge, that is, a charge comprising three components, at all Federal Airport Corporation primary airports-the capital city airports as well as Coolangatta, Launceston, and Essendon. The three components of the charge were an airport facility component for runway, terminal buildings, car parks, baggage handling and other facilities; a terminal navigation component for air traffic control; and a rescue and firefighting component. The question of exemption from landing charges for avgas aircraft at Coolangatta, Launceston and Essendon was raised in the course of consultations with the industry prior to the introduction of the avgas surcharge. However, as this would have meant a higher level of surcharge for all operators, the associations did not pursue this proposal in July last year. Following the introduction of the new charging arrangements, objections were raised by operators of avgas aircraft at these three airports, on the grounds that there was a disparity in treatment when compared with their competitors at general aviation secondary airports. Operators at these three airports incurred the general excise surcharge plus landing charges whereas the users of general aviation secondary airports incurred only the surcharge-that is, there were no landing charges. The extent of this disparity was not foreseen by either the industry associations, the Department or the Government at the time the new charging arrangements were put into place. As a result, the Government indicated that it was prepared to reconsider the position in respect of these three airports once the views of the major associations were provided. The industry associations were not unanimous in their approach to this problem. However, those associations, representing by far the majority of general aviation operators, supported the proposal to replace Commonwealth Government charges at these three airports with an increased avgas surcharge. This surcharge of an additional 0.5c per litre on avgas excise and customs tariff duty replaces the terminal navigation and rescue and firefighting service charges, which are the two components of landing charges which are levied by the Commonwealth. The Government has adopted this proposal. These components of the landing charge were removed from 1 January 1988 and avgas excise was increased accordingly from that date. During consultations on these issues, the Government indicated to the industry associations that no action could be taken with respect to the airport facility component at these airports, since these are Federal Airport Corporation airports. The appropriate levels of charges for this function is a matter for the Corporation. This approach is accepted by the industry association. As a result of the Government's decision to discontinue offsetting excise adjustments, there has in effect been no adjustment to the excise rates on petroleum products since deregulation of the crude oil market as of 1 January 1988 except for the consumer price index indexation which took effect on 3 February 1988. Consumers have, therefore, reaped the benefits of crude oil price falls resulting from the deregulation of the crude oil market. In this regard, the Prices Surveillance Authority recently announced a 2c per litre reduction in the maximum wholesale price of petrol with effect from 10 February 1988. The Government changed its policy of offsetting excise adjustments because in comparison with the widely fluctuating oil market which dominated most of 1986 when the policy of offsetting adjustments was introduced, the oil market is now more stable than was previously the case, giving more certainty to government revenues. In any case, to continue a policy of offsetting excise adjustments would be difficult in the absence of the import parity pricing mechanism and inappropriate in the new free market environment. However, the Government will continue to monitor oil prices closely with a view to protecting Commonwealth revenue in the case of a sizeable fall in world oil prices or reducing the inflationary impact should there be a sizeable rise in prices. During his address to the National Press Club in March last year, the Prime Minister (Mr Hawke) made a commitment to place a ceiling on excise rate indexation increases in 1987-88. The Prime Minister said: The Commonwealth pledges that it will generally restrict the increase in our excises which would otherwise have occurred at the next two half-yearly indexation adjustments to a total of around 6 per cent. That commitment has been met. It was fulfilled in a manner such as to cause the least disruption to the existing indexation arrangements. This was achieved by applying the normal indexation arrangements for the August 1987 adjustment which resulted in a 3.5 per cent increase. The February 1988 adjustment was subjected to a 2.5 per cent ceiling. The August and February increases, when combined, came to a sum of around 6 per cent. Whilst this procedure has resulted in an increase in the rate of excise of 6.0872 per cent over the year to February 1988, this is well in line with the Prime Minister's commitment to limit the excise increase to around 6 per cent. I would like to draw the House's attention to the financial impact of these amendments. First, I refer to liquefied petroleum gas. The 1 October 1987 increase in the excise rate for naturally occurring LPG is estimated to result in an increase of $9.5m in excise receipts in 1987-88. Secondly, I refer to the import parity pricing policy. The alterations in refined petroleum product excise rates due to the change in the import parity prices will result in increased revenue of about $121m in refined petroleum product excise rates effective from 17 October 1987 and decreased revenue of about $66m in refined petroleum product excise rates effective from 14 December 1987. The changes in the excise rates following these changes to import parity prices are intended to offset exactly the forecast changes in revenue from crude oil excise and royalties. Thirdly, I draw the House's attention to the aviation gasoline surcharge. The measure has no direct financial implications as it has been designed only to recover the revenue which will be foregone by the Commonwealth as a result of the removal of the terminal navigation and the rescue and firefighting components of the landing charges levies at Essendon, Coolangatta, and Launceston airports. Aircraft using avgas ceased to be charged for these services from 1 January this year, the date of effect of the surcharge. Finally, I refer to the limitation of total excise indexation to around 6 per cent. The financial impact of imposing a 6 per cent ceiling on excise duty rate increases for 1987-88 is estimated to result in revenue forgone of $25m for that financial year. I commend the Bill to the House. Mr BARRY JONES(Lalor-Minister for Science, Customs and Small Business)(8.25) —in reply-I thank honourable members for their contribution to the debate which began, as the honourable member for Ryan (Mr Moore) pointed out, a long time ago. I just take up a point which the honourable member made about the import parity price adjustments and the effect on petroleum product prices. What has happened to petroleum product prices and excise rates since the deregulation of crude oil marketing? As a result of the Government's decision to discontinue offsetting excise adjustments, there has been, in effect, no adjustment to the excise rates on petroleum products since deregulation of the crude oil market as of 1 January 1988, except for the consumer price index indexation which took effect on 3 February 1988. So, consumers have therefore reaped the benefits of crude oil price falls resulting from deregulation of the crude oil market. In this regard, the Prices Surveillance Authority recently announced a 2c per litre reduction in the maximum wholesale price of petrol with effect from 10 February 1988. I suggest that as we seem to have debates on this matter fairly frequently, it is useful to have an update as to where Australia stands in comparative fuel prices. It has been suggested that this could be called the Bruce Goodluck biannual survey on fuel prices. I have some valuable material on indicative international retail prices for Organisation for Economic Co-operation and Development countries and non-OECD countries. With your concurrence, Madam Speaker, I suggest that the table be incorporated in Hansard. Madam SPEAKER —If the table falls within the normal guidelines, this course will be followed. Leave granted. The table read as follows- Table 8 INDICATIVE INTERNATIONAL RETAIL PRICES (a) (Australian cents per litre) Automotive Gasoline Automotive Diesel Oil OECD- Australia (b) ... *56 *52 Austria ... 112 83 Canada ... 54 52 Federal Republic of Germany ... 83 77 France ... 120 75 Greece ... 80 39 Italy ... 153 78 Japan ... 135 80 Netherlands ... 124 65 New Zealand ... 86 64 Norway ... 115 39 Spain ... 97 64 Sweden ... 103 62 Turkey ... 36 25 United Kingdom ... 95 86 United States ... 43 42 Other- Argentina ... 23 9 Brazil ... 20 7 Egypt ... 19 3 India ... 80 38 Indonesia ... 33 17 Kuwait ... 21 21 Malaysia ... 52 25 Malta ... 111 67 Nigeria ... 13 9 Philippines ... 52 36 Saudi Arabia ... 20 4 Singapore ... 66 25 South Africa ... 50 51 USSR ... 93 70 * Indicates a change in a country's local price since the last issue of Major Energy Statistics. All other changes are due to fluctuations in the exchange rate. (a) Australian prices quoted are for early March 1988. International retail prices are based on latest information received from Australian overseas posts and, for most of the OECD countries' data, are June to December 1987 indicative prices. Prices for most countries have been converted using 1 March 1988 exchange rates. Automotive gasoline prices are for the most commonly used grade of automotive gasoline in that country, at `full-service' prices. (b) DPIE estimate based on advice from the Australian Automotive Chamber of Commerce. (c) LPG use is either insignificant or not for automotive purposes. Source: Department of Primary Industries and Energy. Mr BARRY JONES —I thank the House. I point out that Australia actually ranks fourth of the 16 OECD countries that are listed. The survey lists the prices in Australian cents per litre that is paid for automotive gasoline. The price in Australia was 56c, in the United States of America 43c and Turkey 36c. In Canada where the equivalent in Australian cents is slightly lower, the price was 54c. But the cost is extraordinarily high in countries like Italy where the price is 153c per litre and Japan where it is 135c per litre. The list includes many Third World countries in which the price is sometimes considerably lower than in ours. Not surprisingly, the price in Kuwait is only 21c per litre and the price in Egypt is 19c per litre. India has a punitively high rate of 80c per litre. The table also includes figures for automotive diesel oil. I thank honourable members for their contribution to the debate and 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. Debate resumed from 16 March, on motion by Mr Barry Jones: That the Bill he now read a second time. Mr MOORE(Ryan)(8.29) —The second Bill in this group-the Bounty and Subsidy Legislation Amendment Bill 1988-gives effect to two amendments which the Government proposes in relation to tractors and book bounties. Firstly, I would like to say something in relation to tractors. There has been a long history of protection in relation to the manufacture of tractors and farming equipment in Australia. The Government's decision to terminate the Bounty Agricultural Tractors and Equipment Act 1985 was made in the last Budget. With the termination of that legislation, we have seen the virtual closure of the tractor industry in Australia. The well-known Chamberlain operation in Western Australia, which has ceased operation, was primarily the recipient of bounty payment over very many years. More recently we have seen the closure of Horwood, Bagshaw Ltd in South Australia. This firm has gone into receivership. Mr Porter —They never sold so many tractors. Mr MOORE —I was not aware of that. Mr Porter —Sales were going through the roof. Mr MOORE —They are quite a price no doubt. As a result, there is only one manufacturer of tractors left in Australia: Waltanna Tractors of Hamilton, which falls within the electorate of Wannon. I am quite sure that the honourable member for Wannon (Mr Hawker) would like to say a good deal more about it. Mr Price —And the member for Chifley. Mr MOORE —Does the honourable member have a tractor? Goodness gracious! What does it plough up? It might make a left wing furrow. Waltanna Tractors is the only remaining viable tractor manufacturer now operating. It has been hard hit by this decision which took effect on Budget day. I am quite sure that the result of that will add to the majority of the honourable member for Wannon. The company developed a niche for itself with a very specialised timber forwarder. However, since all the parts needed to make the forwarders are made in Australia, there are tariffs on them. It hardly makes it profitable for Waltanna to keep producing this tractor. That could be easily overcome by way of a by-law. Protection in the form of bounties obviously has not assisted the Australian tractor industry as a whole. As we said in our statement `Approaches to Business', which was released at the weekend, if Australian industry is to become internationally competitive, it will have to operate in a more open environment with less government assistance. It has become increasingly obvious that the Government's web of industry assistance measures, including tariffs, bounties and quantitative restrictions, has resulted in a subsidy culture, along with great disparities in the levels of protection which have effectively favoured some industries at the expense of others, as well as disadvantaging consumers in the long run. There is no doubt that many of Australia's rural producers will lament the closure of some tractor operations in Australia because sometimes the products arrive in Australia-- Mr Shack —We are listening. Mr MOORE —I am pleased about that. The honourable member for Tangney must have a tractor too. I cannot imagine why the tractor industry is doing so badly if everyone has one. Mr Porter —I need a new one. Mr MOORE —Obviously the imported ones are not doing the trick. As a consequence of this cessation, it will be interesting to see whether Australia's sole surviving manufacturer can survive the new-found competition. The second part of the Bill before us tonight relates to the book producing industry. The bounty assistance to the book producing industry has been extended to 31 December and is being phased down from 20 per cent, beginning on 31 December 1988, as follows: 18 per cent from 1 January 1989, 16 per cent from 1 January 1990, 14 per cent from 1 January 1991 and 13.5 per cent from 1 January 1992. All those in politics who are writing autobiographies ought to get busy and do so quickly. If a former Prime Minister could not get his printed, I do not know how the Minister for Science, Customs and Small Business (Mr Barry Jones), who is at the table, will get his next publication across if the subsidies are not there. The cost of the bounty will be $18m in 1987-88; $21.4m in 1988-89-that increase is due to the number of bicentennial books produced this year; and $19.3m in 1989-90. Prior to 1993, when the scheme expires, the bounty will be further reviewed. There are also some minor changes which will facilitate administration of the scheme: an increase in the minimum production run from $200 to $500; a minimum production run requirement of 1,000 copies or more of the same book-in other words, stricter guidelines in the production runs; deletion of the requirement that children's books contain pictures; and self- financing government publishing enterprises-the Australian Broadcasting Corporation in particular-producing and marketing books in substantial competition with the private sector will be eligible to receive the bounty. Government enterprises should be able to compete on an equal footing with private enterprise, which is one of the first steps to privatisation. We do not oppose the proposals in this piece of legislation. Mr PRICE(Chifley)(8.35) —I am pleased to speak in the debate on the Bounty and Subsidy Legislation Amendment Bill. By way of introduction, I remind the House and the people of Australia of the Opposition's position on industry measures, such as those contained in the Bill, throughout the last Parliament. Its position was, by and large, consistent with the remarks of the Opposition spokesman for business and consumer affairs-the honourable member for Ryan (Mr Moore)-that is, it supports a whole raft of Government initiatives. But it is also true that, come election day, the then Opposition spokesman on industry, Senator Tony Messner, did a complete back-flip on industry policy as it had been articulated in this House over 2 1/2 years, and promised industry in Australia that all forms of government assistance would be completely wiped out overnight. If there is one thing that business finds most difficult to comprehend and to react to, it is radical changes of policy whether by the Government or the Opposition. Given this complete backflip in policy during an election, the Opposition's stance and credibility in terms of industry policy have been brought into question. There can be no guarantee that what is said today will be the policy which the Opposition takes to the people when there is an election. I notice that the honourable member for Ryan, the shadow spokesman who has just contributed to this debate, has been given credit for being the key architect of a Liberal Party so-called five-point plan to boost the economy. As part of that plan, it is offering lower industry protection. As I said before, when it talks about lower industry protection, there is no guarantee that it will not change its position overnight and completely remove it. The Opposition cannot be trusted. I now turn to the specific nature of the Bill, in particular as it affects the bounty on agricultural tractors and equipment. The Opposition has suggested that there are only one or two manufacturers. I have a very small producer of specialised tractors in my electorate-E. M. Baldwin and Sons Pty Ltd. That is a firm in which I take a great deal of interest because it suffered under the vagaries of the decline in commodity prices and the lack of purchasing of equipment by agricultural producers. Indeed, it is trading under a scheme of arrangement. Not only was the firm involved in producing super-large tractors for the agricultural sector but it also produces a whole range of specialised mining equipment. I remind the Minister for Science, Customs and Small Business (Mr Barry Jones) and the House that Australia's expertise in manufacturing mining equipment gives it an advantage in world markets. It is seen as a sector that can increase dramatically. I have raised my concerns about the Bill-incidentally, it was a Budget item, announced in the last Budget-in the Caucus. I think it is only fair that I should raise my concerns about the Bill in the House. Firstly, I do not like it when the Government announces a scheme to last for a certain period and then reduces that period fairly peremptorily. If my memory is correct, the scheme was supposed to run to about 1992 and we have terminated it. Secondly, the Minister, in announcing the Bill, assured everyone that every firm was telexed the decision to cease the bounty. Unfortunately, E. M. Baldwin and Sons received no such telex, and that is acknowledged by the Department. It is extremely bad administrative practice to do away with a bounty and fail to notify every player. I do not think it is satisfactory to say that the measure was announced in the Budget. As I have acknowledged, this is a small business trading under a scheme of arrangement. A very common factor with small businesses is that they are usually totally preoccupied with their business, trying, as it is commonly said, to make a quid and they are not the greatest readers of government literature, government regulations or government announcements. Unfortunately, this decision vitally affected that business. I wrote to the Minister who I thought was the correct Minister, the Minister for Industry, Technology and Commerce (Senator Button). I said, amongst other things: Please find enclosed correspondence from the company. They were unaware of the cessation of the bounty and were not advised by telex. They only found out of the changes when an application for the bounty was rejected. The amount of the bounty involved is $18,753 and would be the same approximately for the other 2 tractors mentioned in their letter. I would be grateful if you would sympathetically review the situation as I feel strongly that we have to bear responsibility for advising of the changes. I received a reply dated 8 April from the Minister for Science, Customs and Small Business (Mr Barry Jones), the Minister at the table. It said, amongst other things: The Government took the decision to terminate the bounty scheme as part of the 1987-88 Budget. On the night of the budget telexs were forwarded to known manufacturers of agricultural tractors. No telex was forwarded to E M Baldwin and Sons as it was understood that it was no longer actively trading. I say frankly to the House: I do not think that is good enough. A bit of sloppiness on the part of a public servant should not be sufficient to jeopardise the viability of this company. I repeat: I think this company has a good future. It is innovative. It specialises now in mining equipment. This is an area of Australian expertise and an area where we have potential for exports. This company ultimately will trade out and export its way out. How does the Government expect a small company trading under a scheme of arrangement, after a series of government decisions which take three times $18,000 away in bounty which the company expected to receive, to survive? I implore the Minister to give this case special attention and special consideration. We have a real onus of responsibility, having failed to advise the company, to sympathetically look at the request. I also want to talk about another aspect that I find ironic in the proposals. These proposals will do away with the bounty. They will allow the importation of tractors-fully built-up tractors-completely duty-free. If a company operating in the electorate of my colleague the honourable member for Wannon (Mr Hawker) or in my electorate decides that it wants to trade on, having a specific belief in its expertise, its niche marketing and its ability to adapt to these circumstances, and if that company has to import component parts it has to pay a tariff on those parts. Here we have a contradiction. On the one hand, imported tractors come in completely duty-free. If one wants to manufacture tractors and import some of the component parts, one has to pay a tariff on them. That is a serious contradiction and one the Government ought to look at. The Minister, in his second reading speech, says: . . . I should like to point out that agricultural tractors and equipment are incorporated in the reference on mining, construction and agricultural equipment currently with the Industries Assistance Commission. It is therefore open to people to put forward their views to the Commission on what they consider to be the appropriate level of assistance for this industry sector. I certainly invite all the players in the industry to put submissions. I specifically draw to the attention of the Industries Assistance Commission this contradiction in its recommendations and government policy; one can import a fully made up tractor but if one wants to continue some limited manufacture, production and assembly in Australia one must pay tariffs on all the component parts. I will conclude my remarks by going back to the general proposition that I put. This matter is unfortunate. I have said before in the House that I was truly shocked during the last election to see this backflip on industry policy by the Opposition. If there is anything that this country needs at the moment, it is unanimity of view on industry policy and on general economic direction. We really cannot afford the luxury of cheap point scoring on industry policy or the economy. Every opportunity we lose today has gone forever. I say to both Government and Opposition members that there is a real need for us to get together in the national interest to ensure continuity of growth and of government policies and decisions so that people in industry know exactly where they are and can plan and grow for the future to provide more jobs for more Australians. Mr HAWKER(Wannon)(8.46) —I would like to begin my remarks by commending the honourable member for Chifley (Mr Price) for putting forward a very clear and logical argument as to why the Government has made a serious mistake. It is rather sad that the Government appears to be so out of touch that it cannot even hear a case that is being argued by one of its own backbenchers. There is a clear, logical and irrefutable argument as to why the Government has made a serious error in trying to cut out this bounty for larger tractors. As the honourable member for Chifley has pointed out, the Government gave the industry an undertaking to continue this bounty until at least 1992. It is a very serious matter. We have seen the lamentable decline in the tractor building industry over a number of years. It has reached the point where probably the only viable tractor manufacturer left in Australia is the one in my electorate, just out of Hamilton-Waltanna Tractors. I recognise the honourable member's case. I hope that company can trade out of its problems, and with the improved agricultural situation that may be an option and a real opportunity. I hope that the Minister for Science, Customs and Small Business (Mr Barry Jones), who is at the table, will take on board these points because there is a genuine case. It is not a question of asking for special favours or any such thing. There is a genuine case as to why that tractor bounty should have been continued and, failing that, why there should be some other special consideration. I will outline the case now as the honourable member for Chifley has already done so well. Quite simply, there is now the opportunity for the importation of large tractors, such as those in competition with Waltanna, totally free of import duty. Yet a manufacturer such as Waltanna, which assembles its tractors partly with imported components, now has to pay duty on those imported components, a duty that the fully imported tractor does not attract. I am sure the Minister would appreciate that this is totally illogical, quite unreasonable and, if I may say so, rather unAustralian. The simple fact is that the bounty in the case of a tractor manufacturer such as Waltanna is not some great bonus. It works out roughly equal to the cost of the import duty on those components which the manufacturer has to bring into the country to assemble those tractors. I hope the Government will look at this case as a genuine one, give it proper, sympathetic consideration and realise before the Bounty and Subsidy Legislation Amendment Bill becomes an Act that there is a very strong case to reconsider. I would like to take just a bit of time to explain to honourable members a little of the background of Waltanna Tractors. Waltanna commenced operations just outside Hamilton in 1975 and it has been successfully manufacturing large articulated four-wheel drive agricultural tractors ever since. Waltanna has been competing against the imports of the giants of America, Canada and Europe and has been doing so extremely successfully. It produces a product that the local market wants and it backs up that product with good service and reliability. Although it is a small operation and employs only nine people directly, when the subcontracting personnel for all the components are taken into account, it would employ the equivalent of another 25 to 30 people in the manufacturing of its tractors. Waltanna has established a dealer network throughout Australia and backs up its product with excellent after sales service. For the last two years there has been a decline in sales of some 70 per cent in Australia's tractor market, with a discounting of about 40 per cent by some of the sellers of imported tractors. Despite that, Waltanna is still operating, is progressing, and is still developing new products, one of which I shall mention shortly. This is an example of another case in which the Government should act and look very closely at what is being done to a local manufacturer with regard to a fully imported product. Waltanna is also actively pursuing export markets and is in fact looking closely at exporting to a number of countries. It has received inquiries from New Zealand and Canada, and also, interestingly enough, from Hungary. One may well ask why Hungary has made inquiries of Waltanna. The answer is quite simple. Currently Hungary supplies some of the heavy axles that are used in the manufacture of the Waltanna tractor. In fact, in relation to axles and other parts that come from Hungary, Waltanna has spent more than $1m. The repeal of the Bounty (Agricultural Tractors and Equipment) Act by the Budget last year had a fairly adverse effect on Waltanna. The effects could well prove to be very serious. Not only does Waltanna produce tractors, but also it is involved in quite a deal of research and development to try to improve its tractors. It was using much of this bounty to do just that, as well as to offset the cost of tariffs imposed on imported products. I now wish to relate some of the specifics. The effect of the duty imposed on components that Waltanna uses in its tractors has been almost balanced out by the value of the bounty. For example, in relation to a 300- to 400-horse power tractor the value of the bounty on the components works out at about $9,350. It may be anything up to $12,500 for the cost of these components, which would be added to the retail value of the tractor. For clarification, the value of the bounty adds about $9,000 to the wholesale value and when that is translated to retail value prices it becomes another $12,500. As a further example, in 1987 the retail value of a 280-horse power Waltanna tractor was just over $146,000. The fully imported tractor, which I repeat did not attract import duty, manufactured by Steiger had a retail price of $150,000 and the Versatile tractor from Canada had a retail price of $148,832. By 30 December that year the price of the Waltanna tractor had increased from $146,000 to $157,000. In other words, it went from being the cheapest in its range to suddenly becoming the most expensive. As Waltanna worked through some of the components that it had in stock, with the increased effect of the bounty, I am told that as of 1 April the retail price of a Waltanna tractor will have to rise to $158,625. In other words, from being highly competively priced, the Waltanna tractor is rapidly approaching the situation where it will be priced out of the market. I have here a table which shows not only the recommended retail prices of the Waltanna, Steiger and Versatile tractors before and after the bounty, but also the cost to the dealer and what has happened in the last three months as Waltanna has worked through its stock of components and will now pay full duty on its components. I seek leave of the House to have the table incorporated in Hansard. Leave granted. The table read as follows- COMPARATIVE PRICING-AUGUST, 1987. (With Bounty) 280HP 4WD Tractor with Power Shift Transmission Make Rec/retail Dealer nett $ $ Waltanna (Aust) ... 146,250.00 117,000.00 Steiger (U.S.A.) ... 150,400.00 106,320.00 Versatile (Canada) ... 148,832.00 119.066.00 COMPARATIVE PRICING AS AT 30th DECEMBER, 1987. (Without Bounty) 280HP 4WD Tractor with Power Shift Transmission Waltanna (Aust) ... 157,500.00 126,000.00 Steiger (U.S.A.) ... 150,400.00 106,320.00 Versatile (Canada) ... 148,832.00 119.066.00 Set out below is a further increase in price from 1.4.88 due to the Bounty not being paid to Australian manufacturers of tractor components e.g. Cabs, Rims etc. Waltanna ... 158,625.00 126,900.00 Mr HAWKER —I thank the House. I mention also that Waltanna has developed a timber and forestry machine, which is used in the primary removal of timber from forests. The machine was well built and was well received. Waltanna has received an excellent response to what it has tried to do. The machine has had incorporated in it a crane that loads the logs that are cut from the forest on to what is known as a timber forwarder, and it transports the timber from the forest down to where the timber is loaded onto trucks to be taken to the timber mills. Waltanna, having incorporated into the machine a crane, went to a local crane manufacturer to enquire whether it could build a crane to Waltanna's specifications. The local crane manufacturer said, `Look, really the size of your operation and the numbers of machines you want do not warrant our making that special crane. It would have to be virtually a one-off machine'. Therefore, Waltanna has to import the crane; the local manufacturer is not interested in making it. The crane attracts a 35 per cent duty, which in fact adds a further $12,000 approximately to the price of the machine. The same situation arises: a fully imported machine attracts no import duty yet a manufacturer who builds such a machine in Australia finds that a $12,000 duty is imposed upon a major component of the machine. Duty is imposed also on some of the other components it has to import. Consequently, the total duty payable on the timber forwarder is almost $26,000. The situation is that a manufacturer has developed and built a machine that is considered to be equal to, if not better than, any product that is imported and is able to sell the product at a cheaper price than the imported product, but has to pay duty in relation to it. If one were cynical, I suppose one could say, `If the manufacturer can sell it for less why worry?'. Obviously, the answer is that if the Australian manufacturer can make the product at a lesser cost and is able to compete on fair terms with the imported product, there is obviously scope for export. I am sure that every member of this House would seek to encourage a company such as this to develop that export market. I ask the Minister and the Government to take this matter on board and examine it closely. This is a genuine case. What has happened to Waltanna because of these duties? The first thing is that it has had to cut its costs somewhere. It has postponed much of its research and development, which has only just recently turned out this timber forwarder. Undoubtedly it would have been able to build on this unit and even manufacture other products. Of course, its program has been delayed and if the duty is not removed-or fair compensation by whatever means is not forthcoming-presumably the company will not develop to its full potential. It is a most efficient and impressive company. I hope that one day when the Minister makes one of his sojourns into western Victoria he will pay a visit to the company premises. I am sure he would be most impressed with what he saw. The manager and owner of Waltanna has informed me that he has other export opportunities in the pipeline, but again they have had to be postponed. He depends very heavily on his research and development program and if he cannot afford to carry that out it is unlikely that he will go ahead with these things. Although the Government may believe that there will be a small saving involved in the removal of the tractor bounty-and it would be only small in overall terms-the cost to Australia will far outweigh any savings made by the Government. It will greatly constrict the operations of the last viable tractor manufacturer in Australia. From a national point of view it is a source of great embarrassment that Australia is unable to sustain more than one tractor manufacturer. Mr Hunt —Australia is a great agricultural country. Mr HAWKER —As the honourable member for Gwydir reminds me, Australia is a great agricultural country. Really and truly, we should be taking a long hard look at ourselves and asking why this situation has ever been allowed to happen. In conclusion, I inform the House that Waltanna has assured me that it could develop quite a large market overseas, with a potential market of the order of $5m. However, none of these opportunities will be realised unless it is given a fair chance to compete on a fair basis against overseas imports. I have spoken at some length with the management and they are quite genuine about this. They have had real inquiries. They have openings overseas that no other manufacturer of a similar product has and they have worked hard to get them. But if they cannot get the chance to compete on the local market and develop sufficient cash flow to carry out this work it is unlikely that they will go ahead with these exports. I ask the Minister to advise his Department to look very carefully at this case and at the case mentioned by the honourable member for Chifley. We would be very foolish to ignore what will happen if we do not reconsider the implications of this Bill. As I said, this is a genuine case. I think the Government should have a long hard look at this. We are creating a situation where an Australian manufacturer is worse off than someone who is importing a fully built up tractor. I cannot for the life of me see where the fairness and equity is in such a move. Mr CAMPBELL(Kalgoorlie)(9.01) —Much has been said about tractor manufacturing in the debate on the Bounty and Subsidy Legislation Amendment Bill, and I will return to that matter in a moment. I want to speak briefly about books. I was a little concerned when I heard that we intended to phase down the bounty on Australian books because I believe that Australian books serve a very useful purpose in building an Australian culture. With all the damage being done to the fabric of Australian society by multiculturalism, I think it is a very good thing for us to have a uniform culture that is enhanced by encouraging the publication of Australian literature. When one looks at this issue carefully one sees that the Government is giving trade-offs and that the effect is fairly neutral. This is indicated by the fact that the paper itself says that the effect on revenue is zero. Allowing manufacturers to include different coverings for their books in a 1,000-book run is a very big saving for the industry, and it is very wise of the Government to make that decision. In Australia a run of 1,000 hard cover books is a big run. If soft cover and hard cover books can be mixed, many more books will be brought within the ambit of this legislation. Similarly, standardising picture books and children's books of more than 16 pages is a move in the right direction. I am very happy with what has been achieved there. I am a little uneasy about the tractor bounty because tractor manufacture is very much a decentralised industry in Australia. I have said many times in this Parliament that one of the great problems facing Australia is the growing dichotomy between city and country. Australians increasingly live in the coastal cities. There is a tendency for us to grow apart as a nation and we are not concentrating on decentralisation. All governments pay lip service to decentralisation-it is a little like motherhood-but the reality is that we do not do a lot about it. In saying that I mean both political parties. Australia has a natural advantage in the manufacture of tractors. We have probably the greatest need in the world for large four-wheel drive tractors. It has always been a matter of concern to me that most of these tractors are imported from Canada or the United States of America. As to Australian-produced models, I have a manufacturer very close to my electorate in a town called Merredin in the electorate of O'Connor, where the Phoenix tractors are produced. I think the Phoenix is one of the best designed tractors in terms of maintenance available on the market. I guess if someone has the money they will still build a tractor for him. Removing the bounty will make it less likely that people will have that sort of money. I want to look at another aspect of this issue. Australia lost an enormous advantage when that bounty existed. Not enough attention was paid to buying Australian tractors. It is true that foreign tractors had a distinct advantage in entering the country duty free whereas Australian tractors had duty imposed on components. This was always a source of annoyance to me, and was something which I thought would have been very easy to get rid of, particularly in a climate where we are talking about reducing protection. Industry itself neglected the Australian tractor. Industry itself failed to support Australian inventiveness and ingenuity, and I hold the gold mining industry particularly responsible for this. This Government gave the gold mining industry an enormous advantage. When I was campaigning for the abolition of the gold tax we were given undertakings that the gold mining industry would look very seriously at Australianising its purchases and developing a demand for Australian manufactured goods. The gold mining industry, unlike the iron ore industry or the coal industry, tends to use medium sized equipment. It tends to use equipment that Australia manufactures. I hope that we will not get involved in the very big equipment because I do not think the Australian market is big enough, but there is a very large market for the medium sized equipment. If the gold mining industry had shown just a little more initiative, many of those agricultural tractors could have been beefed up and they would have been ideal for the industry, particularly for clean-up work around mines. If every gold mine in Australia bought a couple of these machines there would be an ongoing market. Similarly, a specialised tractor is required for the handling of wheat. Because of the specific gravity of wheat a very large bucket is needed to carry the volume, although wheat is not particularly heavy. It needs a specially designed tractor, and I know that Phoenix put a lot of work into a tractor with a bucket designed specifically to meet this need. The tractor was designed to go backwards very quickly because that is the way a lot of wheat is handled in silos. At the time they lost out to a Japanese product which certainly was not as good but was marginally cheaper. Of course, before the product was delivered the Australian dollar slumped and the Japanese tractors ended up costing a lot more. I think that was one case where the wheat industry, and I guess I could say the farmers of Australia, demonstrated a lack of foresight. Had they supported Australian manufacturing industry in that instance it would have been a feather in their caps and one which they could have traded off at a later date. That was not done and I suspect that that opportunity has been lost. It is important for Australia to have these sorts of industries in country towns. While Australia has a large per capita demand for this sort of tractor, the price will not be enhanced much by economies of scale. These tractors are too individual to benefit from the economies of scale that are obtained with a mass production run. There is no doubt that the men employed in country towns, be it six or 20 or 30, make a significant contribution to a town's economy whereas in the cities they would go unnoticed. We should be looking at these things in Australia. It is all very well to talk about savings to government-an amount of $900,000 a year in this case. I suspect that the current account cost will be significantly higher. It does not need many people to buy imported tractors instead of Australian tractors for the current account cost to be much more than that. The problem we have right now is a current account problem and it is one which we should be constantly addressing. I certainly feel for the Baldwin company, and the honourable member for Chifley (Mr Price) spoke extremely well on that issue, as did the honourable member for Wannon (Mr Hawker), albeit a little repetitively. However, they did make the point that manufacturers who had budgeted for that bounty to continue have a legitimate complaint and one which the Government should consider. I believe we in Australia are tending to lose sight of where opportunities lie. I am a great believer in high technology. I think that the Minister for Science, Customs and Small Business (Mr Jones) has made an enormous contribution to the future of Australia by continually pushing the theme that Australia must get involved in these high tech areas. It continually depresses me when those who attempt to move in that direction are thwarted by irrational fears, by vested interests and by what can only be described as sloppy, lazy journalism. I cite a case in my electorate where the Government's message to a French company basically was this: `You nasty French company; you have been exploiting us; you have been taking our monazite overseas and making enormous profits by downstream processing. You have to stop this; and we demand that you process this product in Australia so that we get the value added, we get the new high tech jobs, and we get the employment'. The French company said, `If that is what you want, all right'. Of course, the minute they set up to do that they developed the waste product thorium, a constituent of all granite. Thorium is radioactive. It is only mildly radioactive for it has a half life of 14 billion years, so I guess it will see most of us out. The irrational fears that were raised by people when the company sought to deposit this waste product in what can only be described as very arid land in my electorate were absolutely fantastic. The sloppy, emotional articles that have been put in the Press have been quite sickening. I was at a public meeting in Coolgardie recently attended by about 200 people, the great bulk of whom were very hostile and abusive about the proposal to store thorium waste. I must say that the State Government handled the matter very badly, but that does not overcome the facts. The former member for Kalgoorlie, Mick Cotter, played on every emotion, fear and unfounded suggestion, and was roundly applauded. He was no doubt the hero of the day. I do not see it in that light; I think it was a disgrace and a tragedy. Australia really must be prepared to bite the bullet on these issues. I now return to the Bill. I thank you, Mr Deputy Speaker, for your tolerance. In many Australian country towns there are companies with the initiative to make machinery that has niche markets. There are companies that can apply the resources for which we as a nation rightly take some credit and produce equipment at very competitive prices. Notwithstanding the new mood on privatisation and efficiency, there has to be the mechanism to encourage these people. I understand the difficulties in that, but I suggest that the problems in encouraging small operations in country towns are not those of mass production, where inefficiencies can very quickly become entrenched. These companies do not become inefficient; they are too small and their work forces are usually far too involved to succumb to inefficiencies. In these towns workers put in more effort than generally occurs in the cities. I know that the Phoenix tractor company in Merredin has workers who are prepared to work beyond their knock-off time to finish a job without thinking of the extra few dollars that that might mean. That is the sort of attitude on which we can build a surprising amount of industry. If Australia does not face up to its declining rural populations, it will have a real problem. I see that as one of the serious issues facing Australia. I fear it is not being tackled. Notwithstanding the rhetoric of political parties, no one is seriously looking at the problem. I believe we are developing two Australias, one with a rural economy and one a city economy. Australia cannot survive on that basis. If that trend is not reversed, I hold fears for our future. This, our bicentennial year, is a good time for us to start addressing this real problem for Australia. In doing so we can build a nation worthy of our children, a nation which can give them employment and security in the future. Mr HUNT(Gwydir)(9.15) —I commend the honourable member for Kalgoorlie (Mr Campbell) for the sentiments he expressed, particularly in regard to the importance of industries such as the semi-heavy industries in some of our country towns which are so fundamental to community life and employment opportunities, limited as they might be in some of our regional centres. I commend also the honourable member for Chifley (Mr Price) for bringing to the attention of this House and the Minister for Science, Customs and Small Business (Mr Barry Jones) his concern about a specific industry in his electorate. I am sure the Minister will give due consideration to the concern that the honourable member has raised in the House. I want to focus my remarks on the protectionist principles involving bounty and subsidy schemes and tariffs aimed at ensuring the so-called viability of industries. I make particular reference to what the Minister said in his second reading speech: When the agricultural tractors and equipment bounty scheme was introduced in mid-1975, the Government believed it would assist the local agricultural tractor industry to become economically viable in the longer term. He went on to say: However, since that time production by the major manufacturers in Australia has virtually ceased, and it has become clear that the scheme has not been effective in maintaining an internationally competitive tractor manufacturing industry in Australia. I stress the Minister's words: . . . it has not been effective in maintaining an internationally competitive tractor manufacturing industry in Australia. That is an incredible state of affairs. In spite of the fact that there has been a 40 per cent devaluation against the trade weighted index in six years, and in spite of the bounty scheme, the tractor manufacturing industry in Australia has virtually ceased-in one of the biggest agricultural trading nations in the world. It should alarm all who are concerned about our balance of payment deficits and our record foreign debt, now passing the $115 billion level. We are not competitive. We want to be very careful that we do not do the same to our own agricultural export industries. Why are we not competitive in the manufacturing industry and in so many other industries? Whilst the tractor industry does not have a large production or throughput, it faces the problem that the vast array of industry in Australia also faces. We are not competitive because our levels of productivity are low; our unique work practices and short working hours are uncompetitive; our domestic economy is racked with inflation much higher than that of competing nations; and our interest rates are double, even treble, those or our competitors. These problems are due in part to government actions such as the interception of the fall in world oil prices. I wish to elaborate a little on that because this particular action alone rocketed the excise on fuel from 6 cents a litre to 20 cents a litre and exploded Federal revenue from fuel from less than $5 billion in 1982-83 to $7.6 billion in 1985-86. We simply cannot go on with these kinds of insensitive decisions and expect the Australian inflation rate to stay in line with world trends. I urge the Government to review that aspect of its taxing policy. The agricultural tractor industry has once again shown that Australia cannot resolve its uncompetitive dilemma with protective devices which shield uncompetitive levels of productivity, uncompetitive wage increases and outdated work practices. Our chickens are coming home to roost. We can think back to the days in the early 1970s when the Australian Council of Trade Unions was demanding shorter working hours and work practices that were clearly beyond the capacity of the economy to pay. I recall saying that Australia could not afford such increases and the industrial disruption that went with them, particularly in 1974. I thought at the time that this would surely severely harm our long term competitiveness, particularly in manufacturing industry and in industries such as tractor manufacturing. Indeed, it has. The once proud Australian tractor industry lies in ruins. It is a broken, beaten industry. Mr Tim Fischer —Merredin destroyed. Mr HUNT —The honourable member for Kalgoorlie brought that to our attention. The honourable member for Chifley raised another example and the honourable member for Wannon (Mr Hawker) raised another example in Hamilton. It is little wonder that the Government decided that its bounty system was not helping the industry. The two major tractor producers, the Horwood-Bagshaw and Baldwin companies, are both in receivership. Who would have thought that six or seven years ago. The last major producers of tractors, Chamberlain John Deere Pty Ltd, has ceased production. The industry has been smashed. The uncompetitive economic environment in Australia has been a significant cause of the problem; yet, we cannot stop there. The difficulties experienced with production costs have been severely aggravated by a lack of demand for agricultural tractors. This has been due in large part to the severe erosion of farmer incomes year after year. It is little wonder that, with average farm incomes running at less than half the average wage for season after season, money has not been there to spend on new machinery. In my electorate, which happens to be one of the biggest agricultural producing areas in Australia, the median income of people is half that of people in the industrial areas of Sydney. These people include the farming community, which is absolutely strapped for cash and has not been able to afford recapitalisation or capital investment in machinery. The crisis has been double edged for Australian farmers, who face increasingly sharp cost increases for imported tractors in light of the 40 per cent plus devaluation and near record interest rates. On top of this, they are expected to continue shouldering the burden of tariffs on spare parts, chemicals and a wide range of farm machinery. The farming industry is expected to carry on with only nominal assistance while shouldering the burden of protection for secondary industry in this country-a burden now running at a minimum of $9,000 per farm per annum. The farm sector earns 40 per cent of our gross domestic export income. But in net terms it is probably more than 60 per cent. In spite of this, it seems that the anti-agricultural economics of those opposite are set to continue. We hear consistent rumours that the last vestige of assistance for the farm sector is in for the chop on or before 25 May. Yesterday, one report suggested that the Minister for Primary Industries and Energy (Mr Kerin) had agreed to a massive run-down of underwriting schemes, wool promotion, the superphosphate bounty, the 50 per cent export inspection charge rebates and the on-farm diesel excise rebate. We have been told that even the rural adjustment scheme is headed for the axe. This scheme is the last avenue for any measure of government encouragement towards industry rationalisation and the retention of viable family farms. These farm industries are largely unassisted. Assistance to the wheat industry comes to 2 per cent; for barley growers it is -1 per cent; oats, zero per cent; maize, -4 per cent; sorghum, -3 per cent; oilseeds, -2 per cent; beef producers, effective assistance of just 7 per cent; wool, 3 per cent; sheep meat, 2 per cent. In total, farmers receive an average effective rate of assistance of about 10 per cent, less than half the assistance afforded to secondary industry. Our farmers are competing against subsidies as high as 100 per cent in the United States and 160 per cent in the European Economic Community. The Government has already torn more than $500m from its outlays to farming. The total net Budget outlays to farming in Australia are less than one-half of 1 per cent of the total Budget outlays. The Government spends on farming in a year what it spends on social security in a week. The Government has already slashed such crucial measures as income equalisation deposits and tax averaging-so essential to industries which experience wide fluctuations in income. It is harming not only the farm sector but also associated industries such as tractor manufacturing in this country. Mr McGauran —They matter. Mr HUNT —They do matter. As I said earlier, what an incredible state of affairs it is when an industry as important as agricultural production is reaching a stage at which there will barely be a manufacturer of industrial equipment for the farm. I think it is one of the most serious things that we are facing in this country. The Minister for Science, Customs and Small Business has been pushing technology. He has been pushing the new high tech industries. I think he is wise to do so, but, we really must not forget other industries that have been so important to the living standards of Australian people, and will be for such a long time. Mr Cobb —We must not forget the basics. Mr HUNT —The honourable member is right. We cannot go on hacking up foreign debt by 400 per cent while continuing to hurt the export industries which give us our only hope of reducing our foreign debt. It is high time that the Government undertook a radical rethink of its entire approach to the vital issue of protection and assistance for Australian industry today. Failures such as the agricultural tractor bounty are only dragging us deeper into the mire. In particular, there can be no justification for cutting any deeper into the last vestige of assistance to agriculture until the $9,000 burden on farmers of secondary industry protection is largely demolished. To do otherwise would be economic lunacy. Yet there is an effort under way to slash wool promotion, underwriting, the superphosphate bounty, diesel excise rebates and so on. However, I must say that I welcome the tentative step that has been taken in the area of secondary protection today with the reduction in tariffs on imported motor vehicles from 57.5 per cent to 45 per cent and the abolition of quotas. But the action has not gone far enough if the farm sector is to be slashed further. An industry spokesman immediately claimed this afternoon that the changes are unlikely to affect retail prices. The consumer cost of imported passenger vehicles has gone through the roof largely because of the huge devaluation of the Australian dollar. The industry itself has a tariff of 45 per cent to remain in place. This is on top of the benefits of devaluation. If actions such as this are trumpeted by the Government as a justification for attacking the slight assistance left for farming the Government's actions will be transparent. We still have not heard whether such industries as textiles, clothing and footwear are to receive some kind of special treatment in any across the board tariff cut. If this Government proceeds to fiddle around the edges of the tariff burden, indexes wages, to satisfy union demands and further slashes what remains of Budget outlays to Australian farming, it will deal a lethal blow to many rural industries which presently are on an economic knife edge. Such action would affect all Australians and their living standards. Our living standards have already undergone a sharp decline over the past five years despite unprecedented levels of foreign borrowing. We cannot afford to make more of the kind of economic blundering which has destroyed the Australian manufacturing industry. This Government's response to the bounty, subsidy, tariff and quota issues has enormous implications for every Australian family. As with Argentina, the health of the farm sector is the key to the overall health of the economy of Australia. Protection policy must recognise that farmers cannot pass on their costs since 80 per cent of their production is exported to very often corrupted world markets. They have met that corrupted competition with minimal effective assistance. They are lean and efficient, but they cannot afford a new round of Government attacks. Slash the farmers any more and the Government will undermine their capacity to play a leading role in rescuing the economy from a probable recession more serious than any witnessed by the past two generations. Protection cuts must be implemented but in a programmed, steady and predictable manner. They must be aimed first and foremost at those sectors of industry which currently receive the highest tariffs, quotas, subsidies and bounties. In other words, make comprehensive cuts to tariffs first and then see where some budgetary assistance can be withdrawn from the farm sector. I am sure that the farmers will not complain. Once other industry sectors have been brought back to the average assistance level applied to farming, then our farmers will be in a position to stand totally on their own feet against corrupted competition from subsidised countries. The Hawke Government must proceed along this path in a comprehensive and meaningful way, in a progressive move towards reducing industry protection before robbing the farm export sector of the last vestige of its budgetary support. We must not fail to learn from the Argentine experience. They bled their farm sector dry, wrecked their living standards, and today cannot even afford an old age pension. The Opposition does not oppose this Bill, but expresses its disappointment at the manner in which the Hawke Government has approached the plight of the agricultural tractor industry in Australia. The Bill is an admission of the Government's dismal failure to strengthen the local tractor manufacturing industry, which has suffered not only a difficult domestic economic environment but also the effects of a rural downturn. First and foremost, it should have concentrated on macroeconomic policies to encourage a competitive domestic economic environment-and nothing is more important to this nation than those four words, `competitive domestic economic environment'. But the Government has also kicked the farmers and, in turn, this is undermining their associated service industries and small businesses, such as the tractor industry. It is high time for the Government to concentrate on policies to improve the overall competitiveness of the Australian economy. If it fails to do so, it will leave a shocking legacy to our children and to our grandchildren who at some time will be called upon to pick up the tab for our own failings and the failings of this generation. Mr Peter Fisher —They are suffering now. Mr HUNT —They are suffering today, but they will suffer more in future unless we strive to make Australia a more competitive nation. Mr BARRY JONES(Lalor-Minister for Science, Customs and Small Business)(9.34) —in reply-I thank honourable members for their contributions to the debate. Much of the discussion in this debate has been about the tractor bounty, and a strong case was put by a number of honourable members-by the honourable member for Chifley (Mr Price), the honourable member for Wannon (Mr Hawker), the honourable member for Kalgoorlie (Mr Campbell) and up to a point, although he did not concentrate on the matter to the same degree, the honourable member for Gwydir (Mr Hunt). As honourable members will appreciate, it was a Budget decision. I suppose that the decision could have been made in the presentation of the Budget as to whether the decision was to be phased in or whether it was to apply immediately on announcement. In fact, the decision was made to apply immediately on announcement. As honourable members know, that happens with scores if not hundreds of decisions that are made, and that is part of the whole Budget-making process. Obviously we shall not, I hope, attempt to overturn the Budget tonight, but a serious case has been put. Certainly I undertake to give further examination to the matter. The whole issue of assistance for the making of agricultural implements and equipment is currently being considered by the Industries Assistance Commission (IAC). I hope that people who feel that they are seriously disadvantaged will have already made submissions to the IAC. I think the case was put very strongly. I want to address some remarks to the honourable member for Chifley who raised, in particular, the case of E. M. Baldwin and Sons Pty Ltd. He complained that on the night of the Budget when telexes were forwarded to nine manufacturers of agricultural tractors, no telex was sent to E. M. Baldwin and Sons because it was understood that that firm was no longer actively trading. I concede that that was a mistake, which is regretted. The file was noted quite correctly within the Department of Industry, Technology and Commerce with the words `Receiver and manager appointed'. This firm had been a very small player in the scheme. I think it produced something like only one to three tractors a year. The assumption was made-wrongly, it would appear-that the firm was no longer actively trading. I appreciate the difficulty that it is in. On the other hand, the reality is that it is hard, if not impossible, to see how any discretionary payment can be made. There is no fund which we can dip into and say, `Here is an anomalies case'. I appreciate that it is poor consolation to say that the industry implications were announced in the Budget and publicised in material that was circulated by the Minister for Industry, Technology and Commerce (Senator Button). I feel some concern about this matter. I certainly will raise it with Senator Button because I think it is an object lesson of how careful we have to be in passing on information about fundamental decisions to people who are players in the game. I want to talk specifically about the tractor industry, then I want to pick up some of the points that were made by the honourable member for Gwydir. There really is a problem. The bounty was set up in 1975 to help maintain an industry that was going to be viable and that was going to significantly serve the Australian agricultural industry. I have been given information that certainly in recent decades Australian manufacturers had something of the order of only 10 per cent of the local market. When Chamberlain John Deere Pty Ltd was removed, the players who remained were making, in a sense, custom designed tractors in very small numbers. It is very difficult to look at those small numbers collectively. These would include the three, perhaps, from Baldwins. I gather from what the honourable member for Wannon was saying that the numbers were very small in the case of Waltanna Tractors. I do not know quite how many but I would think perhaps something less than a score a year. If we turn around and say, `Well, can we say that the system which services something that creates a viable industry and which is serving the whole of Australian agriculture is vindicated?', the answer, obviously, is, `No, it is not'. I concede that a different kind of argument can be put. The honourable member for Kalgoorlie put very well the significance of small enterprises such as these for elements of the rural economy. I have always conceded that in examining economic realities we often need to disaggregate statistics, instead of aggregating them. Often the national aggregate is a kind of statistical myth. For instance, one might look at the Australian infant mortality figures and say, `Well, there is nothing to worry about in Australia. The figures are very tiny'. If one then starts to disaggregate them, one might say that the infant mortality figures for Aborigines living in country areas are appalling. It is useless to say, `Ah well, but the national aggregate is all right'. One has to disaggregate it in this case, and I think that a strong case can be put that those figures are really misleading. I urge the honourable member for Gywdir not to persist with the folk myth, as he is inclined to do a bit, that some of our industrial and economic problems have occurred only in a couple of bursts, between 1972 and 1975 and since March 1983. It just is not the case. Look back at Australia's pioneering work and at the work, for example, of H. V. McKay. I was doing some work on this for an article that I was writing not long ago, and I pointed out that back in 1904 the Harvester company moved to Sunshine-it was then called Braybrook-and it was soon the largest Australian manufacturing works and the largest manufacturing exporter, selling equipment to Argentina and South Africa. But international competition was acute. High tariff protection was needed and in 1930 H. V. McKay Pty Ltd was acquired by the Canadian Massey-Harris corporation. McKay's story is an instructive parable about Australian technology in the global context. I became the member for Lalor in 1974-before the 1984 redistribution-just as the last element of the Sunshine works was closing down. An entire history of the Australian manufacturing of agricultural equipment had come to an end. Whether it is possible to maintain sub-optimal industries is a problem. Craft industries are of great significance, but is it possible to apply any kind of rational bounty scheme when the object of the exercise is, in this case, to get tractors in the hands of the consumers at the lowest possible price? I see the apparent anomaly raised by the honourable member for Wannon. He says, `But this is ridiculous. We import the tractors duty free, the components come in subject to duty and that makes it harder for the local manufacturer'. But the answer to that is to ask whether there is a benefit to the broad range of consumers through their getting the tractors imported duty free. I appreciate the point made by the honourable member and I appreciate the particular cases mentioned, such as that mentioned by the honourable member for Kalgoorlie. But the intention of the legislation is to provide a benefit to farmers generally. If there is a feeling that this is not succeeding and that a duty ought to be imposed, I would be surprised if that view has strong support out in the rural electorates. The problem is whether we should change the whole system of protection in order to provide additional support for an industry which demonstrably has not been able to satisfy the needs of the Australian consumer. It has provided only a tiny proportion of its requirements. It is a classic case of having to ask ourselves how far we are really able to apply the principles of economic rationality. Of course the situation appears to be exacerbated when we look at the amount of money involved-$900,000. It may be said that the degree of pain involved may well be out of proportion to the $900,000 that is saved for the revenue. I concede that that is a valid point, and I think we have to look at it again. The honourable member for Gwydir referred to the virtual annihilation of the Australian manufacturing industry. It is true that between 1967 and 1983 employment in manufacturing fell from 27 per cent of the labour force to 17 per cent-a fall of almost 40 per cent in that 16-year period. It is true that there was some decline, but perhaps less than one would imagine, in 1972-73. After the tariff cuts of 1974 there was a fall in some industries, but the fall was surprisingly small. It just meant that there was a long term trend which continued until 1983. Since then the size of the labour force has increased considerably. Manufacturing share went from 17 per cent to 15 per cent in the last census returns of 1986. Of course, that is a phenomenon that is commonplace in virtually every country of the Organisation for Economic Co-operation and Development (OECD). I do not know of any OECD country in which the percentage of people employed in manufacturing has increased in recent years. There was a bit of rhetoric from the honourable member for Gwydir that might have gone down very well with some of the National Party branches in his electorate. He said that we have some disadvantages compared with some of our trading partners. I remind him of the economic situation we inherited and of the fact that in the last five years a remarkable series of attempts has been made, and I think with a high degree of success, to restructure the whole nature of the Australian economy. I draw the honourable member's attention to the significance of the textiles, clothing and footwear (TCF) plan, the significance of the steel plan, the significance of the passenger motor vehicle plan. Only today, as the honourable member for Gwydir conceded, a very striking reduction in protection was announced. It is extraordinary to hear that kind of rhetoric on the other side about protection and concern that levels of manufacturing protection are too high and represent a $9 billion impost on Australian consumers. I must ask: what serious attempts were made between 1975 and 1983 to change the regime of tariff protection in this country? There was no record at all. We inherited a high level of unemployment, a high level of inflation, high interest rates and a projected Budget deficit of around $9 billion. We are the first to regret that our interest rates and inflation levels are higher than the OECD average, although our unemployment figures are very satisfactory if one looks across the board at other OECD countries. The point is that we have transformed the nature of the industry. Earlier we had a little discussion about what had happened with the midway report that Senator Button issued about the passenger motor vehicle plan. The fact is that in 1983 it was starting to look very doubtful as to whether we would have a motor industry at all. It is true that there has been a tremendous benefit as a result of the devaluation of the Australian dollar, but who would have thought, five years ago, that we would be exporting cars to Japan? Who would have thought at that stage that we would be exporting motor engines to West Germany and other parts of Europe? The motor industry is in a stronger position now than looked likely five years ago. The TCF industry is in a much stronger position now than looked likely five years ago. We have a lot to be proud of. I agree about the importance of our great agricultural strength, although I still insist that the emphasis at this stage has to be on adding value to what we produce. We are still exporting material in the rawest of raw states and we need to add a lot of value to what is a wonderful volume and a wonderful quality of primary produce. I think we ought to talk about some of these issues in future, particularly as we found tonight that there was a good deal of community of interest and people were not talking just from a straight partisan or party viewpoint. There was one final glancing blow from the honourable member for Gwydir. He tried to turn an incorrect speculation in the Sydney Morning Herald into a fact. I refer, for example, to what he said about the rural adjustment scheme. That scheme, as the Minister for Primary Industries and Energy (Mr Kerin) could testify most eloquently, is actually at record levels and is being enhanced. Did I say that right? Mr Kerin —Yes. Mr BARRY JONES —I thank honourable members for their contributions to the debate. Question resolved in the affirmative. Bill read a second time. The Bill. Mr BARRY JONES(Lalor-Minister for Science, Customs and Small Business)(9.51) —I move: Schedule 1, page 7, omit the amendment of the Bounty (Textile Yarns) Act 1981, substitute the following amendment: ``Section 3aa: Repeal the section, substitute the following section: Increased factory costs `3aa. Where: (a) the last condition for the payment of bounty in respect of bountiable yarn (in this section called the ``eligible yarn'') of a particular kind referred to in a paragraph of the definition of ``bountiable yarn'' in subsection 2 (1) is satisfied on or after 1 July 1987 and in a qualifying accounting period of a producer of the eligible yarn; and (b) in the same qualifying accounting period of that producer, bountiable yarn of the same kind as the eligible yarn, produced by the same producer is sold, or otherwise disposed of, for export from Australia; the factory cost, whether or not incurred after 1 July 1987, in connection with the process or processes carried out by that producer in the production of the eligible yarn is increased by an amount equal to 30% of the factory cost incurred in connection with the process or processes of producing the bountiable yarn referred to in paragraph (b).'.''. The amendment, which is to section 3aa of the Bounty (Textile Yarns) Act 1981, repeals the existing section and substitutes a redrafted provision to express more simply the Government's policy initiative introduced last year of extending the eligible production costs upon which bounty is payable under this Act to include a proportion of the producer's production costs associated with export production. On further consideration of section 3aa, it was considered that the original policy could be enunciated more clearly without the use of the formula style which is currently employed. Indeed, claims for bounty received since the commencement of the new regime, that is, 1 July 1987, have highlighted the inordinate complexity with the application of the formula. It was therefore considered that, rather than proceeding with the correction to the formula proposed in the Bill, a redraft of the section was appropriate, and that is what the proposed amendment achieves. Amendment agreed to. Bill, as amended, agreed to. Bill reported with an amendment; report-by leave-adopted. Bill (on motion by Mr Barry Jones)-by leave-read a third time. Debate resumed from 17 March, on motion by Mr West: That the Bill be now read a second time. Mr SHACK(Tangney)(9.54) —At this reasonably late hour the House turns its considerable attention to the Ministers of State Amendment Bill 1988. This is annual legislation which is necessary to establish the maximum annual sum for the payment of salaries of Ministers. Such legislation is regularly required because section 66 of the Constitution prescribes, subject to the Parliament providing otherwise, a maximum annual sum for the payment of salaries of Ministers. This legislation is a case of the Parliament otherwise providing. If we look at section 66 we might hark back to yesteryear when we read that the sum provided when the Constitution was first drafted was stated not to exceed #12,000 a year to pay the lot of them. But on this occasion the legislation seeks to raise the total sum paid in ministerial salaries this financial year by $65,000, from $680,000 to $745,000. Part of this increased allocation goes to pay the 3.8 per cent increase in ministerial salaries, which is the same as the increase awarded to ordinary private members of parliament some little time ago. But there is another reason for this increased allocation and that is to accommodate the rise in the salary bill due to the Government's decision, after the 1987 election, to increase the size of the Ministry from 27 to 30. The Opposition does not oppose the Bill. We did not oppose the 3.8 per cent increase in parliamentary salaries. We did, however, oppose strongly the increase in the Ministry from 27 to 30. When the Ministers of State Amendment Bill (No. 2) 1987 was debated, we opposed it. Our position still is that we would not have expanded the Ministry if we had won the 1987 election. However, we recognise the reality of this expansion so even on this ground we do not oppose this Bill. However, the opportunity to debate this legislation provides us in proper context with an opportunity to re-examine the decision of the Prime Minister (Mr Hawke) and the Government to expand the Ministry last year from 27 to 30. After that examination, this legislation also provides us with the opportunity to ask whether the Australian people are getting value for their money from the Hawke Ministry. If we recall the circumstances surrounding the expansion of the Ministry from 27 to 30, we will remember that it occurred immediately after the July 1987 election. We would be entitled to ask-as we did then and as we do now-whether this increase in the size of the Ministry was to ensure better government for the country. Was the expansion to bring in people of such talent and ability that only creating three extra places could have allowed it? I regret to say that the answer to both those questions is an emphatic no. If our recall is excellent we will remember the grubby and sordid episode that dominated the nation's media in July last year. We witnessed day after day in the Press and on television the spectre of the factions battling it out to divide up the spoils of office. The cost of that ultimate settlement was nearly $1m to cover the three extra Ministers. It was nearly $1m per annum to cover their extra salaries, their staff, their offices and all the other circumstances that pertain to ministerial offices. As I have said, that is nearly $1m of taxpayers' money every year. What happened? The honourable member for Robertson (Mr Cohen) was dumped. Senators Richardson and Robert Ray-those leading luminaries of the right wing faction-came in to take their share of the spoils. Senator Tate was dumped, then he was back in again, the reason being that there must be a Minister from Tasmania. Senator Ryan was almost out-at least of the Cabinet-then was retained because in this balance the Government had to have someone from the feminine sex in the inner Cabinet. It was a sordid factional political deal which, in terms of the two questions I asked, had nothing to do with ensuring better government for Australia and had nothing to do with bringing in people of talent and ability that only the creation of three extra places could have accommodated. It certainly had nothing to do with ensuring that the best people would occupy some of the most important political offices in the land. I say `best people' because the Prime Minister never resiles from an opportunity to trumpet loud and clear and long the talents of his Ministry. We in this Parliament and in Australia generally outside this place have heard him talk about `the best Ministry ever'. We have heard him say that the Hawke front bench is the best front bench since Federation. As I have said, this Bill provides us contextually with an opportunity to assess that statement. In my State, coming as I do from the West, the Prime Minister is now known affectionately as Black Jack Bob, the one shoe expert. He was quoted in the Canberra Times in November 1977 as saying: If a man . . . shouts from the roof tops that those in high office should be subject to scrutiny, he should have exactly those standards applied to himself. As I have said, the Prime Minister never loses a chance to talk up the Ministry, but the record shows that he and many of his Ministers have been involved in incidents which in the Westminster tradition would normally mean instant dismissal or resignation. The Prime Minister's approach has been to tough it out unless public outcry threatens the Government itself. But events have even got to him. After the most recent election the Prime Minister admitted that the Ministry might not be the most talented ever or the most talented possible when he said in his 22 July 1987 Press conference: There are other criteria as well-of State and gender-but the point I take is that having given proper consideration to those two criteria as well as talent, I will have in the third Hawke Labor Government an extremely talented, competent and relevant team. Huh! If we look at some of the personal standards that have characterised the various Hawke ministries we could do no better than to start with what we might call the Keating standard. Most Australians were stunned to discover that the Treasurer (Mr Keating), after lecturing his fellow countrymen on tax ethics, had forgotten to file his tax returns for two consecutive years. But that was not enough. Revelations of a tax-free travel rort worth $17,000-plus a year, which the Treasurer engaged in from 1983 onwards by claiming Sydney as his home base while actually living with his family here in Canberra, made his lecturing of others on tax honesty a little hypocritical, to say the least. From the Treasurer we have a standard of behaviour which certainly does not match the Hawke prime ministerial rhetoric. Let us look at the current Minister for Administrative Services (Mr West). He was forced to resign from his position as a Labor Cabinet Minister after publicly disagreeing with the Prime Minister on the uranium issue. He wanted to preserve Labor policy on uranium, the anti- mining view. In an unprecedented move within the Westminster system, that Minister continued and still continues to hold a ministerial post. After that episode, having been demoted outside the Cabinet, he has subsequently been re-admitted to the Cabinet despite the Westminster tradition of Cabinet solidarity. Let us look at the former member for Adelaide and a former Minister in the Hawke Government. What standards do we see under that gentleman's banner? Then a Minister, Mr Hurford wrote to Adelaide 5DN radio personality Jeremy Cordeaux, offering to `break stories' from Cabinet in return for regular chats on the radio station in his home electorate. It is true that Mr Hurford admitted his blunder; but according to him in that admission, his proposal to break stories for a quid pro quo was a joke, done in cheek. We are told, `It was a lovely little furphy'. Mr Hurford was not sacked but he was later dropped from the Ministry after the last election. He did not, however, drop out of sight. He resigned from Parliament six months after the last Federal election-which resulted in a by-election that cost the taxpayer $170,000 at least-to take up a government diplomatic post in New York at a salary, plus allowances, of $120,000 a year. When we look at the standards under the title of the Minister of Education, Employment and Training (Mr Dawkins) honourable members will recall that Minister Dawkins was also an outspoken critic of tax evaders. But in April 1986 it was alleged he was linked with a company known as Coomel Pty Ltd and that shares had been transferred from a bottom of the harbour company to his mother. Even then the Prime Minister did not act. He said the matter had been disposed of satisfactorily. We do not have to go far to find other examples of ministerial propriety, if I may debase the word. The former Minister for Sport, Recreation and Tourism, the honourable member for Parramatta (Mr John Brown)-universally known as the Minister for Having a Good Time-was found to have misled parliament over the World Expo theatre contract and was forced to resign. Only two months after his resignation the Prime Minister indicated an intention to return the honourable member to the Ministry. However, when the honourable member for Parramatta gave in the Weekend Australian his version of the events leading up to his resignation, it caused such embarrassment to the Prime Minister that it now seems unlikely that the reappointment of the honourable member for Parramatta will occur. In this assessment of the Hawke Ministry standards we certainly cannot go past the famous, notorious Mick Young. The Special Minister of State, and later Minister for Immigration and Ethnic Affairs, dear old Mick, was first forced to resign his post after the Hope royal commission into the ASIO-Combe-Ivanov affair. The commission found that Mr Young's actions gave rise to a real danger of significant damage to national security. After a relatively short absence from the Ministry Mr Young was reappointed to Cabinet and to the sensitive national and international security committee of Cabinet. In a second incident he admitted making a false customs declaration, later excusing himself by claiming that the customs forms were too difficult to fill out-that famous infamous Paddington Bear episode. The accident prone Minister finally resigned both from the Ministry and from the Parliament after a scandal over the misdirection of funds donated to the Australian Labor Party by a woodchip company-a scandal that has not yet seen its final days in this Parliament. Senator Tate, that man of talent who was to be dropped from the Hawke Ministry after the July 1987 election, had to be retained at the last minute because he came from Tasmania. That man was forced to admit that he misled the Parliament by claiming that he had read to the Senate the full text of a police report about a casino for Christmas Island when it was later discovered that the report contained other information that the Minister had not revealed. He refused to resign and the Prime Minister, applying those very selective standards for which he has become famous, refused to sack him. There was also the Amann affair, which stands alone without mentioning the name of a particular Minister because it involved not one but at least three Ministers. It related to the awarding of a northern air surveillance contract to a company, Amann Aviation Pty Ltd, without any record of performance, and the subsequent scandal involved three Ministers; Senator Evans, Mr Duncan and Mr Peter Morris. The Minister for Transport and Communications, Senator Evans, has claimed that it is unfair to describe the Amann affair as a bungle; that there was a systems failure. In my wildest dreams I could not think of a more appropriate analogy-a systems failure. It is a systems failure that is not only common to the Amann affair; it is a systems failure that is prevalent throughout this Government, and the Prime Minister's inability to apply ministerial standards. Why would I talk about ministerial standards? Because in the context of the Ministers of State Amendment Bill 1988, under which the Australian community foots the bill for the salaries of Ministers and all their other costs, we are entitled to ask: Are we getting value for dollar? Are they doing the job that they are charged with? Are they fulfilling and discharging their responsibilities properly? I have referred to some individual Ministers to make a very sound case that the answer to all of those questions is a resounding no. Let me leave individual and singular personalities aside and look at the record of the Hawke Government itself, the totality of the members of the front bench who are charged with leaving Australia in a better state for its citizens than it was in when they came to office. That is the charge that we all pick up when we take government commission. The year 1988 is our Bicentenary. It is also the year of the Hawke Government's fifth birthday. There are not many celebrations going on around the country because over the past five years the Hawke Government has presided over the unprecedented financial enslavement of Australia to the rest of the world. The Australian economy is now more financially mendicant than at any other time in the past 50 years. The Treasurer featured in a list of heroes earlier but his boast that he has restored Australia's economic sovereignty is nothing more than a hollow posturing. The truth of the matter is that it has been this Government's policies which have placed Australia firmly in the hands of foreign creditors and financial markets. It is this front bench that has delivered us a current account deficit which is the second largest amongst the 24 industrialised nations of the Organisation for Economic Co-operation and Development. It is this front bench which has given us a foreign debt which has trebled in five years. In that five-year period our overseas debt has climbed from just $24 billion to more than $108 billion and it is rising by more than $1 billion every month. We could pay for a new and permanent Parliament House every month with the amount by which our overseas debt is rising. The overseas debt for every man, woman and child in Australia has climbed to $6,700. This is the legacy of this Hawke front bench, the best we have had since Federation! I cannot think of a more sobering statistic than the following: servicing our foreign debt now requires 64c in every dollar of export income. Sixty four cents of every dollar of income earned from our export trade now goes to paying off our debt-not to build up this nation, not to build our infrastructure, not even to look after our people, if one is worried about redistribution, but to pay our debt, for God's sake, courtesy of this front bench. In the last five years it has risen from a rate of 26c in every dollar to 64c. It did not happen between 1975 and 1983; it has happened since 1983. Under this front bench Australia is now a less fair and more unequal society than five years ago. Over 140,000 young Australians are unemployed and at least 25,000 young Australians are being locked out of our higher education institutions. One hundred thousand low income Australians are condemned to the hospital waiting queues of the nation because of Medicare. There are some 60,000 living on the verge of homelessness and 40,000 sleeping in the open or in refuges. This is the greatest front bench since Federation! After five years of Labor an additional 700,000 Australians have fallen below the poverty line, and single income families with two children have suffered a $42 a week decline in their standard of living. The summary of this case is that the standards of Government under Prime Minister Hawke have fallen alarmingly not only in respect of the personal behaviour of Ministers but also generally, economically and socially. The Prime Minister is presiding over not only an increasingly decaying Ministry but also an increasingly decaying Australia. This is Labor's legacy to this country and that is why the fifth anniversary of Labor rule is not a cause for celebration; it is a time to reflect on lost opportunities, policy failures and promises broken. Let me conclude with a pithy summary of the economic record of the greatest front bench since Federation! We now have the highest interest rates ever. We have record bankruptcy rates. We have the highest current account deficit ever. We have the highest government spending ever. We have the biggest tax take ever. We have witnessed during the life of this Government the biggest drop in the Australian dollar ever. We have the longest public housing list the nation has ever known. We have record levels of home loan repayments. Real disposable income for our citizens is down by 10 per cent. Tax per week is up by between 40 and 60 per cent. The average level of unemployment is up and those unemployed are staying in that pathetic state for many more months than previously was the case. Inflation is twice as high as that of our trading partners, and hospital waiting lists are the longest ever. The legislation which we are going to pass is all about using taxpayers' money to pay Ministers their additional salaries over and above that which they receive for being members of parliament. The direct payment of it is not judged on performance, but we in this House and the nation generally are entitled to assess Ministers and the Government front bench collectively on performance. That is what I have attempted to do this evening. On ministerial performance, according to the Westminster traditions and by any benchmark of ministerial propriet, the Government has a cricket team list of people who have failed the test, people who are no longer in the Parliament, people who are no longer in the Ministry, people who have been kicked down the totem pole. There are others who stay on the front bench and who still take the money when clearly, by any personal propriety or ministerial standards, they are not entitled to do so. But if we leave that to one side a more damning case is to be made, and I have made it in this contribution, about the performance of the Government as a whole, the 30 men and women who have been charged with running this country, improving its prospects and importantly, after their period of stewardship, however temporary, leaving it in a better state than it was in when they first came to office. That is what government policy progress is all about. We are all in here to try to ensure that we leave this country in a better state for our grandchildren, and for our children more immediately, than our predecessors left it to us. On any benchmark, on any criterion, this Government, this so-called greatest front bench since Federation, has failed dismally. Five years after Labor came to power, there is an alarmingly long list of areas in which we can see clearly that Australia is now doing worse than was previously the case. I said at the opening of my remarks that the Opposition will not be opposing this legislation. We will be guaranteeing that these Ministers receive their extra emoluments and salary. But may I say to them individually and collectively, and I say it to them on behalf of a growing majority of Australians, that we pass this legislation now but we pay them reluctantly. We pay them most reluctantly, and the sooner they go, the better. Mr WRIGHT(Capricornia)(10.21) —I can understand why the honourable member for Tangney (Mr Shack), who has just resumed his seat, expresses concern about a Ministry of 30. I doubt whether the Liberals and Nationals could find 30 people on that side who would have the capacity to fill a Ministry of 30, or who would even want to serve with the Opposition's present Leader. The honourable member spoke about what I believe is simply a list of falsehoods when he talked about the record of this Government. One falsehood that the Liberals keep touting around the nation is that the overseas debt we have is a debt owed by the Commonwealth Government. What members, such as the honourable member for Tangney, do not bother to say is that 60 per cent of our foreign debt is in fact owed by private enterprise. It is private enterprise that owes $6m out of every $10m. Twenty per cent of that debt is owed by the States and statutory authorities. I suggest that the honourable member go to Queensland, where the electricity authority owes something like $4 billion. He has the audacity to talk about that debt when in fact about 20 per cent is owed by the Commonwealth Government. I believe he is also taking a very hypocritical stand when he talks about this Ministry, because he is talking about the increase to 30 and the cost. It cost about $700,000 to bring about that change, and yet we are saving $102m or $105m in administration. We are saving the cost of some 3,000 salaries across the bureaucracy of this nation. Let us come back to the hypocrisy. The honourable member now argues against 30 Ministers in a Parliament of 148. Let us go back to 1971, under the then Liberal-National Government. We find that there were 27 Ministers, plus six Assistant Ministers. So 17 years ago we had 33 in the Ministry, but it was not 33 out of 148 members; it was 33 out of 125. If we approach it on a per centum basis we find that at that time the Liberal-National Party Ministry composed 17.8 per cent of the total number of parliamentarians who served in this House-33 out of 125. If we come to more recent times, in 1982, under the last Liberal-National Government, the Fraser Government, the proportion was 15.3 per cent. Let us compare that with the position now. We have an increase from 27 to 30, yet the Ministry represents 13.4 per cent of the total Parliament, because we have 30 Ministers out of 148 members. Mr Martin —No senators? Mr WRIGHT —No, we are talking about 148 in the House of Representatives. The comparison has been made by the members opposite in trying to make out that we have a major discrepancy, a major growth. What we have done is endeavour to overcome administrative problems. Everyone realises that when changes are made problems can arise, but it is necessary to have the courage to make those changes. Instead of having a typical Opposition bucket speech, I would have thought that the honourable member would at least have tried to talk through some of the administrative changes that have been made here. What has taken place is a new approach, where 16 portfolio or Cabinet Ministers are responsible for 16 large portfolios. And supporting those 16, we have 14 non-Cabinet Ministers responsible for a specific part of the Cabinet Minister's or portfolio Minister's portfolio and assisting in a range of functions. There will always be difficulties, but no longer will we have the overlapping and the duplication of functions that existed under previous Liberal-National administrations. This will achieve, and has achieved in the period it has been in place, a substantial enhancement of the decision making process. We have seen enhancement of ministerial control over departments; we have seen senior portfolio Ministers being released from detailed administration work and a focus on strategy which is vitally important to the Australian population; we have seen a substantial reduction in the number of administration problems; we have seen savings; and we have seen better policy coordination and improved Budget processes. At what cost? At a cost of a few hundred thousand dollars-a maximum estimated cost of $1.1m in this financial year. Compare that with savings of $105m in a full year; savings of some 3,000 staff members across the bureaucracy; a portfolio saving, just in the Department of Administrative Services, of some 750 staff years. These are major changes. A streamlining is taking place, yet honourable members stand up in this place and criticise. They ought to come back to the problem that we have a massive country to administer and service. It is a very much decentralised country. There are departments and subdepartments all over the nation and Ministers have a huge job. Yet honourable members criticise the Ministers in effect because they are getting a few per cent increase in salary. This change is necessary because, as the honourable member said, the Constitution locks in ministerial salaries, and unless we amend the Ministers of State Act, Ministers cannot have an increase in line with other members of Parliament. I believe that Ministers are worth every cent they get. Let us consider the amount of money they are paid. A Minister has a base salary of $68,750. I suggest that is not a lot of money. If one compares that with some of the private salaries and incomes of members of the Liberal Party and the National Party, it is a pittance. Compare Ministers' salaries with the incomes earned by real estate agents, by people in the insurance industry, and by middle business leaders. Mr Rocher —By double dippers in the parliamentary pension scheme. They are pretty big bickies. Mr WRIGHT —The honourable member should look at pensions in the private system. When Joh Bjelke-Petersen froze my entitlement from the State House I made a check on what it would have been worth. Had I invested $70,000 in a private scheme, I could have walked away with $450,000, instead of the $300,000-odd that is held in Queensland. So that is nonsense. Let me come back to the responsibilities. Tonight I asked a Minister, `What are your responsibilities in dollar terms?'. He said, `About $4.7 billion'. What would we pay a private sector person to be ministerially responsible for a business worth $4.7 billion? I would suggest a little more than $68,750. We ought to pay Ministers properly. We ought to ensure that we get the best. That is what this Government has: we have 30 of the best. We have 30 members who come from the grass roots of the Labor Party and from every aspect of the community. We have lawyers, business people and teachers-right across the full spectrum of the community-serving this nation and serving it extremely well. I take exception to the personal criticism and attack on Ministers by the honourable member for Tangney. He spoke about what the Government is supposed to have done. Let us think about what the Government has done-the millions of jobs created; overcoming the $9 billion deficit the Liberals and Nationals left us; overcoming the poverty that young people and families have faced; renewing and reshaping the health system, which was a shambles under the Liberal and National Government. Members of the Opposition talk about business and the problems that businesses face. Let us not forget that in 1982, under the Fraser-Howard Government, 70 per cent of small businesses went broke every three years. Those were the facts and figures that came out between 1976 and 1982. There had been a massive failure of business. This Government has proved itself over and over again as a government of the people. It has been led by Ministers who deserve the salaries they get. As I said, those salaries are a pittance compared with what they could earn if they went out into the private sector. It is not even $70,000 a year. I have no hesitation in supporting this Bill. I believe that it should have the full support of the Parliament. It is a measure that is necessary because of the constitutional constraints that exist. We are simply keeping ministerial salaries in line with the salary increases that we, as members of parliament, have received. Debate interrupted. Madam SPEAKER —It being 10.30 p.m., I propose the question: That the House do now adjourn. Mr ROCHER(Curtin)(10.30) —On arrival at Sydney Airport from overseas in February this year, I fully expected to be approached for payment of the controversial but legal arrival tax of $5. I have to admit that at the time I was not sure whether it had been prepaid, and I have to also confess that I was relieved when no-one asked me for it. It was more than interesting to note that there did not seem to be any place I could have paid it, even if I had pursued the matter on arrival. On establishing that I actually had an unfulfilled obligation to pay the tax, I instituted inquiries as to how I might go about it after I returned to Perth. Inquiries having been made, I commenced on the assumption that someone in the Department of Finance or the Department of the Treasury would be likely to accept the money. Accordingly, the Department of Finance was contacted. Advice was obtained that the Australian Taxation Office (ATO) would accept payment of the arrival tax. After checking with the ATO, advice obtained from it said that the Department of Immigration, Local Government and Ethnic Affairs would be happy to accommodate me. Unfortunately, that Department did not want to know and in turn advised me that the airline carrier collected the tax-never mind that it did not and that that was the reason for the inquiry in the first place. Ever hopeful, I rang Thai Airlines, which said that the post office collected the tax. Never one to give up easily, my secretary phoned the office of the State Manager of Australia Post and was told that the $5 fee was not really an arrival tax, but an immigration clearance fee. I understand that one could go to any post office and as well as purchasing a $20 departure tax stamp, if that was appropriate, one could also buy a $5 immigration clearance fee stamp. Naturally overseas visitors would be excluded from this procedure for fairly obvious reasons. If those reasons are not apparent to honourable members, what overseas visitor with a difficulty with this language, but even without a difficulty with our language, would know, without advice from anyone at Sydney Airport or any other arrival centre, where he or she should go to pay the $5 tax? The gentleman from Australia Post said that, if someone had entered Australia without paying the immigration clearance fee, he could-only if he wished; he did not have to-go to a post office and purchase a $5 stamp. The difficulties being experienced by the Government in collecting the $5 arrival tax-or is it really an immigration clearance fee, or are they different taxes?-in no way match the problems that conscience-stricken individuals like me encounter in trying to pay the blessed thing. Honourable members know what trouble members in this House get into for not observing their obligations under the tax laws. We have seen people on either side of the chamber criticised. I made a genuine effort. Before I found out from Australia Post I went to the trouble of writing to the Department of Administrative Services and enclosing a cheque. A member of its staff phoned to say that the Department did not know what to do with the cheque. I have on my desk a letter which arrived last week, just before I left to attend the Parliament, returning the cheque. I do know now that I had to go to Australia Post. I will be one of the few people, if I ever get the opportunity to pay the rotten tax, to have paid it. We have on our books a tax which is not collected, not collectable, and no-one is seriously trying to collect it. Why not repeal the stupid law immediately before we get into any more trouble? The question arises: is this just another unintended consequence of the Government's failure to think through yet another tax, or is it a natural consequence of the example of the Treasurer (Mr Keating) flouting the laws which he administers and which he breached by failing to lodge his personal income tax returns without attracting prescribed penalties? Is that the natural way of things under this Administration? I would like to pose the following question amongst my colleagues and members of this place: how many have been unable to pay this tax? Madam SPEAKER —Order! The honourable member's time has expired. Mr MARTIN(Macarthur)(10.35) —Tonight I would like to pay tribute to a very close friend of mine and staunch supporter of the Labor movement in Wollongong, Michael Lynch, who unfortunately passed away two or three weeks ago. Michael was born in Ashbury in 1931 and was educated at Marist Brothers, Darlinghurst and St Joseph's College, Hunters Hill. He joined the Department of the Navy as a civilian in his early twenties and ended up as Chief of Personnel Removals-an interesting position by its title alone. His love affair with the English and Greek languages was born at an early age from his father who was then a classics master at Canterbury Boys High before going to the Bar after World War II. He was never lost for a word, nor the meaning of a word. In fact, Michael had a very clever, brilliant analytical mind. After his father's death in 1961 he decided to follow in his father's and brother's footsteps and study law. He was admitted to the Bar in December 1965. He practised in Sydney between 1965 and 1973 and came to the Wollongong Bar in 1973 where he developed a large criminal practice. He was appointed Crown Prosecutor in September 1980. Many of his colleagues and, I am sure, many of those people who appeared not necessarily in the witness box but certainly within the courts generally could testify to the fact that his forte was indeed cross-examination in that position of Crown Prosecutor. Michael was a man of many parts and interests. His other passions were archaeology, reading, astronomy, electronics, jazz and, indeed, songs of the twenties and thirties. Michael joined the Australian Labor Party in 1954 when he was 23. Indeed, his other great love came to the surface then. He was a member of the Croydon Park, Campsie and Mosman branches at various times. When he came to Wollongong he joined the Keiraville-Gwynneville branch where he served terms as president, secretary-treasurer and delegate to Cunningham Federal Electorate Council (FEC) and Corrimal State Electorate Council (SEC). Between 1977 and 1984 he was a Corrimal SEC delegate to State Conference on six occasions and also delegate to State Council for six years. He transferred to Balgownie branch, my own branch, in December 1979 and served terms as president, vice-president, secretary and branch campaign director for many Federal, State and municipal elections and branch returning officer for seven years. He was an FEC and SEC delegate for the last several years. In fact, he held the last three positions when, unfortunately, he died. Michael was a very close and personal friend of mine, and, indeed, of my wife and family. He and his wife, Eleanor, and my wife, Carol, and I spent many pleasant hours together. I have indicated that he had a brilliant analytical mind. In fact, Michael was the sort of person one would rather have on one's side playing Trivial Pursuit than against one. He will be sadly missed as a friend. He will certainly be sadly missed as somebody who has contributed greatly to the community within Wollongong, through his chosen profession as a lawyer, and to the Labor Party to which he was prepared to contribute greatly. He will also be missed by what I call his other family, as well as his lovely wife Eleanor. I am referring, of course, to his two black labrador dogs aptly named Ben Chifley and Jill Wran. I think that that has some significance for the Labor Party. Michael was content to be a man who contributed to the Labor movement without necessarily seeking office himself. He was prepared to contribute in a great fashion. As I have indicated, Michael Lynch was the sort of person I was proud to call a friend. He was the sort of person who contributed greatly to the Labor movement. Indeed, he was the sort of person who will be sadly missed by all his friends in Wollongong, Sydney, different parts of Australia and Papua New Guinea. To his wife Eleanor I can only say that I hope that I can still continue to be as close a friend to her as I was to both her and Michael when Michael was alive. I certainly hope to look after her interests in the way which she would wish. Mr McGAURAN(Gippsland)(10.40) —The winning of the tender by Channel 9 to telecast the Commonwealth Games to be held in Auckland in 1990 no doubt will spell a rating win for that network as more and more people tune in to it over that period. There is no doubt that the telecast of the Winter Olympics in Calgary proved a bonanza for the Channel 9 network and allowed it to win the ratings period by a significant margin. However, the letting of the contract to Channel 9 will spell disaster for a great many country people who obviously cannot receive the Channel 9 signal, nor those of any of its affiliate country stations. Mr Mildren —You can watch them at the International Motel. Mr McGAURAN —The honourable member for Ballarat makes a number of facetious and quite irrelevant interjections. If he were really concerned about a number of his constituents who are unable to receive Channel 9, either directly or by relay, he would be able to make a more constructive contribution. The point is that country people are fed up with not being able to view on television many of the major sporting events that are held either in this country or internationally. They did not get to see on television the last Olympic Games held in Los Angeles because they were broadcast by the Channel 10 network. They will not see television broadcasts of the Olympic Games to be held in Seoul because they are to be broadcast on the Channel 10 network. They do not get to see the Victorian Football League's grand final or the running of the Melbourne Cup because those events are also broadcast by commercial networks. A number of country people may well view some or other of these great sporting events, depending on whether the local commercial television station subscribes to the network broadcasting them or to the specific program. Far too many Australians receive only the Australian Broadcasting Corporation's (ABC) broadcasts. It is a disgrace that the ABC does not bid properly for the televising of these great events. I do not mean to convey that the ABC should bid to telecast every grand final of every minuscule sport around the place. It is far easier for the commercial networks to stick up 12 television cameras around a dirt track and televise the motor rally or the motor cars running around that track. But there is no reason why the ABC should be continually outbid for the right to televise these indisputably great events that are of tremendously wide appeal. If the ABC diverted some of the funds that are spent on the self-indulgent garbage which with such propensity it perpetrates upon its unsuspecting viewers, it might actually win a few of the tenders. The question must be asked: why does it lose every time to the disadvantage of hundreds of thousands of Australians? The ABC cannot compete-- Mr Snow —What about the record of the National Party? Mr McGAURAN —The honourable member for Eden Monaro is joining the honourable member for Ballarat in making specious interjections. Does not the honourable member care about some of the people in the south-western area of his electorate or those on the South Coast who are totally unable to receive any television broadcasts other than the ABC? The ABC has yet to offer a convincing explanation as to why it is the unsuccessful bidder-- Mr Milton —It does not have the money. Mr McGAURAN —The honourable member for La Trobe says that it does not have the money. It certainly has the money to pursue a number of unrepresentative programs that are of minuscule appeal to the larger community. I call upon the ABC to at long last offer a convincing reason, other than mismanagement on its part, as to why hundreds of thousands of Australians are being left out in the cold yet again and why there seems to be two classes of television viewers in this country, the first being those who are within range to pick up the broadcasts of the commercial television stations and the other being those who are in the outback, which includes a number of areas of the East Gippsland region. This is a terribly serious matter. I hope that the ABC can offer some proper reasons as to why it is always the loser, it seems, not just in bidding for great sporting functions, but in anything it turns its hand to. Mr MILTON(La Trobe)(10.45) —There is a great fear throughout the world that nuclear war could break out at any time. Regrettably, in four of the six inhabited continents of the world thousands of people are dying or are injured as a result of wars, revolutions or rebellions of one kind or another. Some of these conflicts cause great fear because they could so easily lead to a nuclear war. In the case of many conflicts there is a fear that the two superpowers may become embroiled, which could lead to an escalation of conflict, eventually involving nuclear weapons. For this reason there was a great sigh of relief when the treaty eliminating intermediate and short range nuclear weapons was signed by the Soviet Union and the United States of America on 8 December 1987. Another great step forward has been the creation of nuclear free zones in the South Pacific, Antarctica, South America, the Balkans and northern Europe. The nuclear free zones in the South Pacific were preceded by those in the many local municipal council areas all over Australia. Local councils led the way by declaring nuclear free zones in their municipalities. Our Government is to be commended for its initiative in sponsoring the South Pacific nuclear free zone. Other nuclear free zones are also proposed. The Soviet Union has proposed a nuclear free zone in the Arctic, but unfortunately the Canadian Government has, so far, not supported that proposal. That is surprising because it is supporting the nuclear free zone in the Antarctic. Another nuclear free zone which has been proposed is the 100-kilometre corridor between the two German republics. The Social Democratic Party of the Federal Republic of Germany and the Socialist Unity Party of the German Democratic Republic have agreed to the proposed nuclear free corridor between the two countries. But again, unfortunately, the Government of the Federal Republic is not prepared to consider the proposal. The German Democratic Republic has appealed to the people of the world to support disarmament, and nuclear disarmament in particular. I should like to quote part of that appeal because, in my view, the German Democratic Republic is endeavouring to ensure, by its appeal for the creation of additional nuclear free zones and its organisation of an international forum to discuss nuclear weapons free zones, the natural outcome of a world free of nuclear weapons: The people of the world want to see further steps along the road of nuclear disarmament, as the danger of a nuclear inferno has not yet been banished. Every path leading to a peaceful world, free of nuclear weapons, must be explored. This includes the creation of regions, zones and corridors free of nuclear weapons. Nuclear-weapon-free zones have already proved their worth in Latin America and in the South Pacific. The idea of nuclear-weapon-free zones is gaining ground in North and South, East and West. The German Democratic Republic, which is known for its deep commitment to a nuclear-weapon-free corridor in Central Europe and for the elimination of all nuclear weapons from not only Europe, but the whole world, believes that it is high time that a discussion took place about the whole question of nuclear-weapon-free zones. This should be an international forum for leading representatives of states, governments and parliaments, political parties, trade unions, youth movements, sporting associations, women's organizations, peace movements, associations of scientists and of artists, churches and religious communities and other interested groups and individuals. To this end a preparatory committee has been constituted in the GDR capital, Berlin, today of an International Meeting for Nuclear-Weapon-Free Zones to be held in Berlin from 20-22 June 1988. The day on which the committee was constituted was 18 February 1988. The appeal goes on: We appeal to people of all political persuasions and religious beliefs, whatever their occupation or age, and wherever they live, to support the preparation for this international gathering, that it may turn out to be an objective and open dialogue serving peace and disarmament. I hope that all Australians will support this conference. I believe it is very important to create more nuclear weapons free zones throughout the world. Hopefully, that will eventually lead to a nuclear free world, a place in which people no longer fear for what might be the outcome of local conflicts, or indeed fear that a nuclear war could envelope the whole world as a result of a conflict between, say, Iraq and Iran, or perhaps in the Middle East. The conference has my full support. Mr DOWNER(Mayo)(10.50) —I do not want to talk at great length about the speech we have just heard, but the speech by the honourable member for La Trobe (Mr Milton) was profoundly depressing and rather strange to hear in the Australian Parliament. We have a member of the Australian Parliament falling for one of the oldest and simplest forms of propaganda, coming from one of the world's most totalitarian and oppressive nations which has never given a fig for human rights. The honourable member for La Trobe is a member of this House who I know is very sincere in campaigning for human rights, but fancy his falling for that old two-card trick. Talking of human rights, I want to say something tonight about my concern about nursing homes in South Australia and the Government's current proposal-which it now says it will review, reconsider and put up more proposals in a few days time-to reduce the hours of nursing home care in South Australian nursing homes from an average of around 21 hours to 17 hours. This is an extraordinary proposal. When one asks oneself what is the logic for the Government taking this step, the explanation is that the Government wants to level down South Australia to the standards of other States. I would have thought that honourable members from other States-although there is practically no one in the House tonight who is not from South Australia-would be standing in this House and appealing to the Government to raise the standards of nursing home care in their States to the level of those in South Australia. But no, the Government, myopic as ever, wants to go in the other direction and create hardship and difficulties for the elderly and infirm in South Australia. That is a simple and sincere statement as to precisely what will happen. What sort of Government do we have if its ambition is to lower standards? I know that the Minister at the table, the Minister for Defence Science and Personnel (Mrs Kelly), claims to have great concern for issues of this sort. I know that she, having heard my speech, will go straight to the relevant Minister and say, `Please, why lower standards of nursing home care? Why harm the elderly, the disadvantaged, the frail in South Australia just to get some statistical average?'. This proposal is having a very real impact in my electorate alone. There is a proposal, which we in my electorate have fought for for many years, to establish a new nursing home in the town of McLaren Vale. McLaren Vale is in the southern vales, sometimes known as the wine coast of South Australia, and a large number of elderly people live in that area who in the past have had to move into the metropolitan area if they have wanted to go or have had to go into nursing homes. They are not metropolitan dwellers; they do not want to go and live in a city. Their families, relatives and friends live in the southern vales area, and that is an environment many have known all their lives. However, because there is no nursing home accommodation there, they have had to move out. At long last, after a great sustained battle, we finally managed to get approval for the building of a 30-bed nursing home at McLaren Vale to be built and managed by Aged Cottage Homes. But as a consequence of the uncertainty about the Government's changed policy which I have already described, the fact is that that nursing home has now been put in mothballs. Aged Cottage Homes has said that it will not proceed any longer with plans to build the nursing home until the Government's policy is clear. If the Government goes ahead, as it proposes and reduces the number of hours of nursing home care, the McLaren Vale nursing home will not proceed in the form planned, and may not proceed at all. In the town of Goolwa a new 30-bed nursing home was opened recently and is now filling up, but the Government has also reneged on financial commitments to Aged Cottage Homes at Goolwa and it now has a bill of $40,000 a year to meet. That charitable organisation has to meet a bill of $40,000 a year to make up for the Government reneging on former financial commitments. This Government, which claims to be compassionate particularly now that it has found that lower income people have abandoned it in droves, is turning its back on the aged and frail in South Australia. That is a very serious problem. It is a matter of deep concern to me that people in my electorate are being harmed. I call on the Government to wake up and look after the elderly. Madam SPEAKER —Order! The honourable member's time has expired. Mr COURTICE(Hinkler)(10.55) —In the last few weeks we have witnessed heavy flood rains in many parts of Australia. While I sympathise with and recognise the damage that has resulted, there will be massive benefits to rural regions, particularly those areas which have suffered drought conditions. Unfortunately, while some areas in my electorate received much needed rain, the Burnett region is still in need of more rain for run-off to replenish dams and creeks. This region is experiencing more than five years of severe drought. Recently, the Leader of the Federal National Party of Australia, the right honourable member for New England (Mr Sinclair), correctly stated during a visit to my electorate that the Burnett region has experienced drought for more than five years. The Isis region also has suffered severely from drought. The sugar crop in Isis this year, which would normally be in excess of 600,000 tonnes, is devastatingly poor, and the crushing may well go for only seven weeks. Several meetings have been held in the Burnett region at which concern has been expressed about the effects of the drought. At a National Party meeting held in Eidsvold a watchdog committee was formed. Sadly, though, politics seem to be more important to that committee than farmers' hardship. Most members of this committee are leading lights in the local National Party branches. The organiser of the meeting, the National Party President in Eidsvold, stated that there is a need to change guidelines for household support so that families need not split up. Under the rural adjustment scheme, part C, household support gives income equivalent to unemployment benefit so that farmers can provide essential needs for their families. For the first 12 months farmers need not lease or try to sell their farms so that they are able to consider their options. Mr Fred Henke, the Chairman of the Hinkler division of the National Party, has on more than one occasion made cynical statements to the media, which have confused and disadvantaged farmers who are eligible for household support. I am pleased to say that, on my invitation, officers from the Department of Social Security will be visiting the region. Four representatives from the Department-Mr Ken Carr, the manager, Mr Jeff Watson, Shirley Saokowski and Janet Pownell-will be visiting the Eidsvold and Monto region on 28 and 29 April to correctly inform farmers of their entitlements. I would also like to express my concern for those farmers who are in severe financial hardship and are having trouble restructuring their incomes. I stress, however, that grants of over $100m that are being asked for are not the answer. The Burnett region, along with the Wimmera, Eyre Peninsula, north Tasmania, south-west Western Australia and south-east New South Wales, including the Cooma region, are all suffering from drought. An amount of about $1 billion would be needed if grants were established for all of those regions at a time when all groups are expressing the need for financial restraint. However, contrary to what the State Minister for Primary Industries implies, Federal assistance is available. The natural disaster relief arrangements are, and have been, in place. The relevant point I make is that a drought has existed for more than five years, and even the Federal Leader of the National Party acknowledges this. Yet the region was declared drought stricken only a few months ago by the Queensland Government. The State Government is required to declare specific areas as drought affected, and then inform the Federal Government. The natural disaster relief arrangements then come into operation. The State pays the first $14m. It then matches payments from $14m to $24.5m on a dollar for dollar basis. Over $24.5m, the Federal Government allocates $3 for every $1 that the State contributes. It is totally untrue to state that the Federal Government is unresponsive. The irony of all this is that Mr Neville Harper, the State Minister for Primary Industries, who is the local State member, obviously did not know that a five-year drought existed in his own electorate. Why did it take him five years to declare it a drought disaster? Surely the drought was just as bad last year as it is this year. Farmers have also expressed their concerns in respect of interest payments. Under this scheme the Federal Government provides funds to the Queensland Government at no interest and the Queensland Government lends this money at the rate of 4 per cent. With the stroke of a pen, the State Government can take up this matter and absorb its own costs. In other words, it can lend this money at next to nothing. Obviously, Mr Harper is unable to handle this task. It seems that he is totally out of touch with his own electorate. Question resolved in the affirmative. House adjourned at 11 p.m. The following notices were given: Mr West to move- That, in accordance with the provisions of the Public Works Committee Act 1969, the following proposed work be referred to the Parliamentary Standing Committee on Public Works for consideration and report: Development of new utility helicopter facilities, phase 2, at RAAF Base, Townsville and Oakey army airfield, Queensland. Mr Dawkins to present a Bill for an Act to make provisions for an interim superannuation benefit for certain persons. Mr Donald Cameron to move- That this House- (1) expresses deep concern at the effects of aircraft noise upon several suburbs of the City of Brisbane following the opening of the new Brisbane Airport; and (2) calls upon the Government and the Department of Transport and Communications to take corrective measures immediately. Mr Duncan to present a Bill for an Act to establish a Civil Aviation Authority with functions relating to the safety of civil aviation, and for related purposes. The following papers were deemed to have been presented on 13 April 1988: Defence Act-Defence Force Remuneration Tribunal-Determination-1988-No. 9. Lands Acquisition Act-Land acquired for Pipeline Authority purposes, Wynwood, N.S.W. Remuneration Tribunals Act-Remuneration Tribunal- Determinations- 1988/1-Public Service Commissioner and holders of offices on other bodies. 1988/2-Australian Public Service Management Advisory Board and Pharmaceutical Benefits Pricing Authority. Seat of Government (Administration) Act-Ordinances-1988- No. 13-Plumbers, Drainers and Gasfitters Board (Amendment). No. 14-Classification of Publications (Amendment).