Wednesday, 27 April 1988 Madam SPEAKER (Hon. Joan Child) took the chair at 10 a.m., and read prayers. Bill received from the Senate, and read a first time. Ordered that the second reading be made an order of the day for the next sitting. The following Bills were returned from the Senate without amendment or requests: International Bank for Reconstruction and Development (Share Increase) Bill 1988 Commonwealth Borrowing Levy Amendment Bill 1988. Debate resumed from 14 April, on motion by Mr Duncan: That the Bill be now read a second time. Mr MOORE(Ryan)(10.02) —On 7 October 1987 the Minister for Transport and Communications (Senator Gareth Evans) announced that the Government would establish a Civil Aviation Authority (CAA). This Bill gives effect to that announcement. It is apparent, of course, that this Government generally governs by Press release. The CAA will have operational responsibility for air traffic control, flight advisory services, communications, navigation and surveillance systems, rescue and firefighting; and will provide an aeronautical information service and offer consultancy and management services in its fields of expertise. It will also be responsible for organising aviation search and rescue services. The stated rationale for the CAA, similar bodies to which are in operation in other Western countries, is that it will be more commercial and flexible in its operation, it will have increased productivity, it will be better able to organise its own finances, and it will be more responsive to industry needs. The transfer of the CAA from the Department will permit more efficient cost recovery, and will allow the appointment of a nine- member board of people with commercial backgrounds. It will also allow the appointment of advisory committees. Because significant investment in communications and other areas is needed, the CAA will, it is claimed, have more flexibility in organising its budgetary and charging arrangements in the interests of the aviation industry. Safety responsibility will also be transferred to the CAA, although the Minister will retain the power to make directions on safety, and in the operations of the new Authority primacy will be given to safety over commercial considerations. An augmented bureau of air safety investigations will remain with the Department and perform a safety audit function. The proposal put forward by the Government is badly thought out and has been developed in a hasty fashion, with minimal consultation with industry. It will result in less efficiency, less accountability, more expensive airway systems and-most important-the divorce of safety from the direct oversight of the Minister. Insufficient detail has been provided for the Opposition and for the aviation industry to determine exactly what the impact of the CAA will be. The establishment of the CAA is one of the worst examples of the Government's paying no more than lip-service to the critical issue of consultation with the appropriate industry bodies. That is one of the hallmarks of the Government. It issues a Press release, waits to see how it runs and, if it bounces well, the Government goes down that track but, if it does not bounce well, the Government dismisses the issue and lets it go. There are many examples of the Government doing that, and the establishment of the CAA is but one. We should consider what happened in the media area. Press releases were issued, people rushed out and bought television stations and then the rules were changed. Consider what is happening in relation to company law at present. About one year ago we said that company law should have a national basis. A Press statement was issued, but there is not consultation with the commercial world of Australia on that matter. A small group of 35 people handpicked by the Attorney-General (Mr Lionel Bowen) is going around plotting. If one is a member of the Committee one cannot tell others. That is exactly what has happened in this industry. There has been no consultation, or limited consultation, with the industry which is concerned about the establishment of the CAA. This situation bears out what is happening elsewhere. The Minister for Transport and Communication Support (Mr Peter Morris) in his brief Press release of September 1986 indicated that work would be undertaken `to identify and address the full range of administrative, legislative, financial and operational issues involved'. What has happened in that regard? I have not seen too much action. I will deal with each of those issues in turn. Despite rumours of an internal working report on the matters, no information has been released either to the industry or to the Opposition. There is more of the mushroom cloud. The Government says, `If the report is not too hot, let us vary it. The last thing we want to do is consult with the industry, which will be massively affected by the legislation'. Despite a briefing from officers of the Department, who have been most cooperative, little light has been shed on the matter. It is interesting to note the way in which the fundamental issues surrounding the establishment of the CAA are still wrapped in secrecy. Perhaps that is because the Minister and the Government are simply playing the whole show by ear and have as little idea of the direction and the ultimate shape of the CAA as have the rest of us. The creation of any new Government authority must give cause for concern. Good management should be able to achieve the stated aviation objectives without the need for a separate CAA, although undoubtedly there are existing difficulties in dealing with the Department of Finance. The CAA would have its headquarters in Canberra, and most of the administrative work is done here in any case. As I stated previously, the 7,000 employees will remain under the Public Service Act, so consequently there will be no change in the management. The industry is concerned that this will preclude the commercial operation of the CAA and it is also concerned about the lack of consultation and the possibility of decreased accountability and accessibility. Quite clearly, if we move a group of people from a department into a hived off authority and say that that will be more commercial and that there will be outside directors, if the 7,000 employees remain under the Public Service Act, we will go only half way. Indeed, as the honourable member for Griffith, the Minister for Veterans Affairs (Mr Humphreys), would know, if he employed 7,000 people he would not want them to be directed under the Public Service Act at all. There would be duplication of functions between the CAA and the emasculated Department in such areas as safety, security and financial direction involving charges for services rendered by the CAA. There would not be a reduction in the issuing of regulations, because the Government has failed to implement its promised regulation review before the creation of the CAA. Such a review is an integral part of the coalition's aviation policy. Furthermore, government authorities develop a bureaucratic nature of their own. Given the model of the now money hungry Federal Airports Corporation, one must wonder what the Civil Aviation Authority will be capable of if it is left to its own devices or, worse, directed by the Minister to pay an arbitrary dividend to a greedy Minister for Finance. A key issue is whether the role of setting and implementing safety standards should reside with the Government or be hived off to a statutory authority. The Government has decided to distance itself from safety matters. No rationale has been provided for this decision. Results of an internal departmental inquiry, the Willoughby inquiry-and there are plenty of inquiries with this Government; there need to be-into the proposed CAA structure, has never been made public. The honourable member for Griffith would know that this is one of those government inquiries that are never made public. The Government sits on the hot ones and releases the good ones. What is the Government trying to hide in this case? Many sectors of the industry, including the pilot organisations, are unhappy with the proposed arrangements to include the safety standard setting function in the new Authority, arguing that this will reduce safety standards. There is a real need for more public discussion on why the Government has chosen this option and on what are the pros and cons. Why is the Government almost breaking its neck to get the legislation through without any consultation or time for discussion in the broader community? The former Department of Aviation, which had responsibility for managing the airways system and flight standards division, was a national disgrace. This situation continues with the new Department of Transport and Communications, which is unresponsive, inefficient, unaccountable, bureaucratic, unsympathetic and, by any standards, a high cost operator. There have been numerous complaints and inquiries into the Department's operations, the most notable being the Dick Smith inquiry. I recommend his book Two Years In the Aviation Hall of Doom to all those interested in this area because not only is it light reading but also it is very incisive in its comments. Mr Tim Fischer —The Department has never adequately responded. Mr MOORE —As the honourable member for Farrer says, the Department has never responded. All those who actively participate in the aviation industry and who have read the book will be concerned at its contents. Dick Smith is not a man who makes these comments lightly, and people should address themselves to what he says. I shall give a little excerpt from the book: Over the past two years I have spoken to many people from both the Department and the industry and have copies of the hundreds of documents sent to me. Even though in many cases I have left the comments anonymous, I would be happy to supply an independent committee of review with full confirmation after checking with the people concerned. I have included this section to show the broad spread of dissatisfaction that exists. The first quote I shall give from the book is from a commercial pilot. He says: The Department of Aviation are champions of procrastination, buck passing and consistently playing one interest group off against the other, through their ongoing policy of keeping the industry fragmented, so that there is never any unity in lobbying for improvement. Another quotation is from a retired examiner with over 25 years of experience. He says: One of the reasons I took early retirement was sheer frustration. When Anderson was in charge everything fired, he would not stand any incompetence. When he went it became a complacent retirement area, a cancerous disease set in, all initiative was lost and the Department lost touch with the industry. They selected people from the military, who had grown up in the peace time forces where they were protected. However, they think they know all about the world. I would go home and look at myself. I'd say, `Is there something wrong with me?' I put up lots of ideas to Central Office, but I didn't even get an answer to my letter; they just didn't want to know. Those comments are from a commercial pilot and a retired examiner of 25 years experience, and they show the sort of inertia that existed in the Department when Dick Smith wrote that book. They are but two examples. What has happened as a result of the book? The Government's response is nil. In essence, this proposal-the CAA-vests greater responsibility in those very public servants who in the past have shown no effort to improve efficiency, reduce costs or provide a reasonable level of service to their clients-the aviation industry. This proposal will result in less accountability, higher charges and a less responsive organisation. The Opposition believes that the CAA will do nothing but distance the Minister from the real working of his responsibilities and will enable him to hide from criticisms of the Government. The very real problems which confront the Department need to be addressed logically rather than by a gut reaction to this Government's failure by attempting to sweep the old Department of Aviation under the mat. No information was provided in the second reading speech on costs of the proposal and the intentions for charging. The proposal will result in increased costs; it will not reduce them. There are a number of pertinent questions, and the Government is silent on all of them. Fuel excise is currently charged for the purpose of aviation cost recovery. Will it continue to be so under the CAA regime? Departure tax is currently contributable for the purpose of cost recovery. Will it continue to be so under the new regime? Assets will be revalued, despite the fact that industry has been paying for them for years. What will be the basis of the new valuations and how will it affect costs? The impact will be enormous. Over the years very considerable assets in this area have been written off and paid for. It is proposed under this scheme to rewrite the value of those assets and charge them once again to the current costs of the business. Even the Minister would know, if he has driven a car around the block for 10 years and wants to write it up to current costs, that that is not the way in which any accounting ought to be done. But that is what is proposed. Any responsible person who wants to run an organisation on that basis knows that the consumer will be diddled. The real costs are not there. The CAA will be a monopoly supplier. There will be no incentive to reduce costs and it will be easy to increase charges. I am sure that the Minister for Finance (Senator Walsh) and the Treasurer (Mr Keating) are rubbing their hands together and have dollar signs in their eyes. The Board will pay a ministerially approved dividend. This will increase costs. Costs of implementing standards-which is a nice way of saying policing-are to be met by the industry. Currently, as is the case in the rest of the world, like all other policing costs, they come from Consolidated Revenue. So any charge will result in an increase in costs. Staff are to be employed under the inflexible, restrictive, high cost Public Service Act. If the Government were genuine about reducing costs in this area it would employ staff under a more commercial regime. Additional costs arising from the implementation of this proposal-new investment, the requirement for the Authority to provide a reasonable rate of return and from the revaluation of assets-will mean higher charges for the aviation industry. If the revaluation of assets is similar to the quadrupling that occurred, to over $1 billion, with the Federal Airports Corporation, these charges might be significantly higher over time. In regard to asset valuation, one of the users, a prominent industry spokesman, in consultations and submissions on the CAA, expressed concern at the prospect of CAA assets being valued on other than an historical cost basis. The Bill remains silent on the Government's intentions, other than the provision that the Minister for Transport and Communications and the Minister for Finance are to make such determinations. As the value of assets transferred to the CAA will represent loans to the CAA with capital repayment and debt servicing implications, the industry spokesman remains concerned about the level of debt the CAA will be confronted with because of the transfer of increased values and the ultimate impact that such costs will have on charges levied on users. Quite clearly, if the Government is going to make the revaluation of assets that occurred in the airports situation, where the value of the assets was written up, the debt was incurred on the Authority, the Department of Finance took the cop and wrote off the losses in the Department of Aviation, then the users will have to pay the extra bill. The debts are there, the interest has to be paid, and on top of that a dividend has to be paid. This all points straight down the road to increased cost to the aviation industry. There can be very little doubt about that. For the last two years the Government has been talking about the integration and modernisation of the airway system-IMAS-but it has done nothing but talk. IMAS involves a major integration of flight service officers and air traffic controllers. Before CAA is established it is essential that this integration take place to ensure that a cost-effective operation is transferred to the CAA. Likewise, the Department, under very strong pressure from the industry, has undertaken to review the myriad air navigation regulations and orders which are presently suffocating the aviation industry. These go back to the Air Navigation Act of the 1920s and have been built on every year. They must almost be a challenge to the Income Tax Assessment Act, which is up to 1700 pages. The present Minister for Transport and Communications Support, in his announcement of the proposed establishment of the CAA on 22 October 1986, assured the industry that a thorough review of these regulations would take place. Here we are, some 18 months later, still waiting for that review to commence, even though it has been announced and positions have been filled. After 18 months the Minister is yet to achieve one single change as a result of the establishment of that regulatory review group. It has been looking at the regulations for 18 months and it has not moved one. Even the Minister for Veterans' Affairs could do better than that in moving regulations. It has been 18 months and the Government has not moved one regulation. Mr Humphreys —I am busy looking after the veterans at the moment. Mr MOORE —How many regulations have been moved there? Mr Humphreys —Not too many. Mr MOORE —There we are; they probably go slower still. The effectiveness of that regulatory review group, I am afraid, does not bode well for the aviation industry, which is now to be lumbered with another quango. There are plenty of them around. While on the subject of what the industry sees as essential for the success of any modernisation of the regulations surrounding the Australian aviation scene, the Minister also indicated in his October 1986 statement that consultation with industry would certainly take place because of the numbers of issues to be resolved. That is an admission that there are problems there. So we have at least got that far. We set up a committee of inquiry-another one of these Government inquiries. The Government either issues a Press release or has an inquiry. That is the way it governs Australia these days. When in doubt, trot out a Press release. If it does not work, deny it. If it does work, set up an inquiry and leave it at that. It is interesting that one of the major players in Australia's aviation industry, along with the rest of the industry, is yet to have a real input into this phantom consultation process. For months the Minister and the Department have said, `Of course there will be consultation. We wouldn't think of introducing legislation without at least telling you what is in it'. Yet the legislation has been introduced into the House with very little warning to the industry and it has been given little more than a week to make a response. Many people in the industry saw this legislation for the first time when the Opposition mailed copies of it to them. That is a very familiar scene with this Government. That is also what is going on in the company law area. If that is the Minister's idea of genuine consultation with the industry, then I say it is little wonder that the industry is always very wary of anything this Government has to offer in the area of aviation. The Opposition will be opposing the Bill. Mr CAMPBELL(Kalgoorlie)(10.25) —In supporting the Civil Aviation Bill, I must say that the Opposition has adopted a totally negative attitude. I do not believe that the changes that the Government is proposing necessarily have any cost implications. In fact, it could be quite the other way. There could be substantial savings. The Government's decision to establish the Civil Aviation Authority was born of the Government's desire to make the aviation section of the Department of Transport and Communications more cost-effective and more receptive to the needs of the industry. Here is the nub of the matter, for I believe that we must look at the philosophy of civil aviation. It is my belief that it has become moribund and that this initiative could represent a breakaway from the present mentality of the industry. The new Authority is to ensure a degree of cost recovery, and I support this. If we are to recover costs from industry for services provided, it is essential that the industry be consulted about the nature of those services. Concern has been expressed that air safety matters should perhaps not be left to a commercially oriented cost recovery based organisation. I certainly do not think this is true. While I have no doubt that the Department's regulations have contributed to our world famous safety record, I suspect that the generally high standard of pilot training, coupled with probably the best flying weather in the world, our generally flat terrain and the absence of fog, have played an even more important part. In any case, the United Kingdom has successfully combined the operations of its airway system with safety regulations and I have absolute confidence that the same can be achieved here. I would like to express some concern about cost recovery, which relates to the philosophy that I mentioned earlier. I think that general aviation is generally poorly treated. I suspect that 70 per cent of all general aviation flights take place in areas where no navigation aids exist and that often they use privately owned and maintained airstrips. A cost penalty has been endured by general aviation, as it in part funds facilities utilised by regular airlines. Let us take, for instance, the fire services. The reality is that general aviation never calls on these services. Indeed, for the most part such services do not exist on general aviation routes. In any case, I suspect that, in the case of unpredicted disaster, even where fire services are situated at airports, by the time they were mobilised it would be too late. If, on the other hand, prior knowledge of potential trouble were available, there would be time to get fire vehicles from the fire brigades to attend. I do not know what the services cost, but the costs must be enormous. They may be of some psychological benefit to Ansett Airlines of Australia, Qantas Airways Ltd, Australian Airlines and overseas operators, but they are irrelevant to general aviation, which should not have to bear any part of the costs. I want to sound a warning about what I see as empire building by departments. Empire building has cost this country dearly in terms of productivity. I refer to a move by the Department to insist that all pilot transfers between a harbour and ships at sea presently undertaken by helicopters be done by twin engine helicopters during night transfers. This is very relevant to my electorate-and, indeed, to Australia's export earnings-at the Pilbara ports of Hedland, Dampier and Cape Lambert. It was at Port Hedland that this system of transfer was pioneered, and it has worked very safely and economically indeed. I want to go into this in some detail, as it is important, and I want to make sure that the new Authority does not embrace this crazy notion. Presently the cost of charter of a single engine helicopter is about a quarter of a million dollars a year. Even if the smallest twin were used the cost would double. Given that engine failure can statistically be expected to occur every 10,000 flight hours and that the port authority utilises about 111 night hours per year, statistically a helicopter will come down in the sea every 90 years-assuming, of course, that there is no improvement whatsoever in engine reliability. The cost of preventing just one false landing is therefore of the order of $22.5m. Furthermore, since the water in this area is usually calm and warm, the probability of a safe rescue in very high seas is, I am told by experts, better than 10:1. The cost of eliminating a fatality has now risen to $225m. In a recent accident in the area where a helicopter was forced to ditch-incidentally a twin-engine helicopter-all nine passengers and pilot were rescued. Mr Tim Fischer —It is Rolls-Royce standards; it is unjustified. Mr CAMPBELL —Frankly, this sort of notion put forward by the Department is quite ridiculous and I cannot see why a passenger in a plane is any more important than a passenger in a bus, and no-one would suggest we go to these lengths in respect of more humble forms of transport. As the honourable member for Farrer said, these are Rolls-Royce standards which are really irrelevant to the industry. I am hoping that the new Authority, with a new start, can take a more realistic look at such situations. To extrapolate the statistics, we could expect a fatality to occur every 810 years at the present rate of use. Incidentally, these costs are based on using the cheapest possible option, a Bolkow B0105D, a helicopter presently 15 years old, and a replacement would cost infinitely more. I certainly hope the Authority abandons this nonsense. I also hope that the new Authority looks closely at the present policy of closing down flight service units. I recognise that there are big savings to be made and that the advent of the satellite has provided the technology to phase out these flight service units from country areas. Reluctantly I accept this. I say `reluctantly' because I see across the length and breadth of this nation today a greater centralisation of people in the cities. I have said in this place often before that Australia is probably the most urban country in the world and I do not think it is in our interests to encourage the draining of the centre of this great nation to the cities around the perimeter of the country. However, I accept that the advent of technology will make this inevitable in this area. I draw to the attention of the Authority the special conditions that prevail in Kalgoorlie. There we have a very isolated area surrounded on three sides by sparse or desert country, country with no or very little in the way of navigation aids and very little in the way of landmarks. In this country probably a greater proportion of aeroplanes are forced down and a great degree of local knowledge is essential. Under the new system, searchers would be based in Perth, the State capital, and I think we would lose a lot of the local knowledge. It is also interesting that Kalgoorlie is the busiest airport outside the major capital city airports in Australia. I would like to run through a few figures here. Mr Tim Fischer —Passengers or movements? Mr CAMPBELL —In terms of movements. These figures are of aircraft movements at staffed and unstaffed aerodromes within aerodrome flight information zones during 1986-87. Dubbo, in New South Wales, had just over 15,000 movements, which was the largest number in rural New South Wales. Devonport, in Tasmania, had just over 20,000 and Mildura, in Victoria, had 23,755. Bundaberg, in Queensland, had 22,617. Gladstone had 24,206. Mount Gambier, in South Australia, had nearly 21,000. Mr Tim Fischer —Albury? Mr CAMPBELL —Unfortunately, Albury does not even rate a mention. Dr Charlesworth —It is not as important as Kalgoorlie. Mr CAMPBELL —Obviously not. Kalgoorlie had over 30,000 movements and I think that is significant. As I said, it is substantially the busiest airport and if flight services is to be phased out I would ask the Department to ensure that it is phased out last from Kalgoorlie to give a greater transition time. I also want to dwell on something else that has come to my notice and which I hope the Authority will look at and that is the alteration to Air Navigation Orders 95.10, which deals with the airworthiness of ultralight aircraft. Ultralight aircraft are inventions which one could almost say are Australian. Certainly Australia was at the forefront of their development. In the early days we were producing the best craft, and certainly the most spectacular performances. Unfortunately, we have been left by the wayside. That has been because of the philosophy inherent in the Department that the air was for the Ansetts and the Qantases of this world. There was a disdain for the rights of ordinary people. The House of Representatives Standing Committee on Transport Safety studied ultralights and noted that there had been some accidents. It is significant, however, that no member of the public has ever been killed in an ultralight. People have always participated in sport. I do not know the figures, but I suspect that gymkhanas are far more dangerous than ultralights in terms of the absolute number of people injured. No-one would think of banning gymkhanas in this country. We ought to be looking very closely at this industry. The ultralight has the potential to contribute to the economy. The pastoral industry will use ultralights over the next 15 years, if it has the opportunity to do so, in the same way as motorbikes have been used by-and have made an enormous contribution to raising productivity in-the pastoral industry. In my view the fault has been that the Department has never enforced the regulations it has had in place. It has allowed people to build unsafe or underpowered planes, often with structural faults. The fatalities that have occurred in ultralight aircraft have most often occurred in homemade designs. To go ahead with the draconian proposals that I believe are in the pipeline, to insist that every plane be subject to exhaustive tests, instead of allowing a manufacturer to submit a design and build to those specifications, is a very retrograde step which will, in an authoritarian way, interfere with the pastime-almost a passion-of some people and inhibit potential advantages to this country. I have had some limited experience with ultralights. I find them fascinating. I look forward to the day when they can go a lot faster than they can now. Their limitation now is speed. In terms of manoeuvrabiltiy and handling, they are unique and quite magnificent. I am told by people in the industry that one of the great dangers is people who go from general aviation, flying standard aeroplanes, to ultralights. The techniques are different. It may well be worth while insisting that people who wish to fly ultralights are given some training at clubs before they are allowed to fly them. Legislation to that effect would be worth while. But to put serious limitations on the development of these craft is a very retrograde step and, as I said before, will cut us off from the mainstream development of what could be and should be an Australian export industry. If one looks at the history of Australia one sees that we have been at the forefront of flight. The great South Australian Hargrave who experimented with kites and other great Australian aviators have made us world leaders in this area. It would be a great shame to see the industry inhibited in any way by draconian legislation. I return to the Bill, Mr Deputy Speaker, and thank you for your tolerance in this regard. The Government is moving in the right direction. Establishing the new Authority gives us the ability to take a fresh look at aviation. We can avoid some of the pitfalls of the past. The new Authority will give us the opportunity to look at the myriad of regulations that now completely bind and constipate the industry. It is in line with the Government's general philosophy to make departments more receptive to the needs of users and more accountable. I find the complaints of the Opposition to be without substance. It is lamentable that the Opposition cannot show a little more vision and support some of the Government's initiatives, which are clearly designed for the benefit of the industry and society generally. Mr TIM FISCHER(Farrer)(10.40) —On this ninth last day ever of sitting in this chamber, under the currently circulated schedule, I am delighted to address the House on the Civil Aviation Bill, which is a quite wide-ranging Bill when one examines some of its provisions. For example, clause 24 deals with interference with crew or aircraft. It states: A person shall not, while in an aircraft: (a) interfere with a crew member; or (b) do any act that threatens the safety of the aircraft or of persons on board the aircraft. This covers hijacking. In clause 25, non- scheduled flights by foreign aircraft into this country are dealt with at some length. I will return to those dimensions of the Bill shortly. The honourable member for Kalgoorlie (Mr Campbell) has just addressed the House and, in his own way, launched a withering attack on his Government and the Department of Transport and Communications with regard to yet another example of clumsy regulation and administration by the Department, on this occasion concerning the Pilbara ports and the helicopter transfer of pilots to ships in the Pilbara region. I accept that the honourable member for Kalgoorlie has detailed knowledge of this matter, I also accept that he has quite properly expressed concern about the loss of income from the massive amount of iron ore exports from that area as a consequence of the Department producing a rule that insists on twin engined helicopter operations for the night transfer of pilots to ships. This points to the fact that the Department lays down quite often unjustified Rolls Royce standard regulations which place in jeopardy the viability of a total operation without really enhancing the safety dimensions involved. If there were genuine safety considerations, neither the honourable member for Kalgoorlie nor I or my colleagues in the Opposition would quibble for one moment. But, as the honourable member said, there is a very tenuous connection with safety when we examine properly the operating conditions for the night transfer of pilots. Obviously if there are cyclonic conditions threatening at the time, all the operation would cease anyhow. We are talking about non-cyclonic operations-smooth seas, clear nights and so forth-when effecting the transfer of these pilots. Ironically, this same Department, as detailed in Two Years in the Aviation Hall of Doom by Dick Smith-not to be confused with the Stockman's Hall of Fame-on 26 August 1982 prevented the operation of a twin engined helicopter to Heron Island, insisting that a single engine operation should continue in the circumstances. It would not allow the operator to go to a twin-engine operation because the operator dared to propose this particular change in his operation without going through the minutiae of approvals 12 or even 18 months ahead. As my colleague pointed out, these are the delays caused by the Department. So on the one hand we had in the Heron Island situation the Department saying, in effect, no to a twin engine operation, that operation being introduced under a developmental charter, and then in the case raised by the honourable member for Kalgoorlie saying yes, there will be a twin engined helicopter operation for the transfer of pilots to or from ships. This is just another classic example of the actions of this bureaucratic Department which is now the subject of the attention of the Parliament as we deal with a Bill to set up Civil Aviation Authority to deal with a wide range of safety issues, which I wish to address in some detail. In so doing, I want to contend that the Bill does not really pave the way for overcoming the problems which have been developing in civil aviation in this country. I know that traditionally it is argued that Australia has an excellent record in air safety, and to some extent that is true. To take that statement at face value one must really accept that our weather conditions are so much better on average than weather conditions in the Northern Hemisphere where the great densities of population and flight movements are. Here there are no cyclonic influences. There are no chronic icing conditions, which can so bedevil the safe operation of airlines. There is no poor visibility to the extent that exists in many busy European and north American airports for much of the year. We are operating on a basically flat terrain, by international standards, in much better weather conditions than exist in the Northern Hemisphere for most of the year and, as such, we ought to be at the top of the ladder in air safety. Notwithstanding that, very sadly, in the last month we have seen a commuter aviation level operator crash near Coffs Harbour. We have seen general aviation accidents out of Cairns and elsewhere. We have seen a situation which one does not like to dwell on because, acting responsibly, one does not want to introduce into this debate anything that might in some way end up being a self-fulfilling prophecy. What I do say is that germane to all of this in the performance of the Department, which is now being subjected to these changes in the introduction of the Civil Aviation Authority. Let me just canvass for a moment the situation with regard to radar, which is central to airline safety. In Sydney there is old equipment, crying out for replacement, and the Department has never been able to find the priority thus far to complete its replacement by the year 1988. In Perth, the area of the Minister for Defence (Mr Beazley), I bring good news, to be fair. There, the new radar system is in place. It has been there for years. But do honourable members know what the score is with that particular radar? It is so modern that we have actually reached the minimum European standard of being able to show the height of aircraft and the call sign of aircraft on the radar screen. People might think that that is tremendous, that that is progress: but do they know what the Department has said with regard to that operation for year after year, if not up until this point in time? It has said, `You will ignore that call sign. You will ignore that height on the screen, because it would upset the uniformity of operation to allude to that height, to allude to that call sign, to use the enhanced safety conferred by that call sign'. I am correct in saying this because, along with other members, I went as a member of the committee on aircraft noise to the radar facility and we examined this in great detail. So we have a situation in Perth where people have the new radar but they are not allowed to use the extra information conferred. Mr Jull —Ask the Minister about Brisbane's radar. Mr TIM FISCHER —Let us look at the Brisbane radar-the surface movement control radar at Brisbane. Would honourable members believe that in the process of the design of that Brisbane Airport-albeit commenced by the previous Government but completed over the last five years in detail by this Government-we have a situation where the consoles in the brand new control tower, commissioned last month, are so old as to be incompatible with the surface movement radar system that has been installed at Brisbane Airport? The public servants responsible for that little mishap are potentially placing at risk the lives of people who travel by aircraft in and out of Brisbane. They have a lot to answer for in terms of the risk factor and in terms of the additional costs which are now going to be required to sort out that particular matter. Mr Jull —And the big delays. Mr TIM FISCHER —And the delays are massive at the new Brisbane Airport. We have also seen in recent times-and I do not point the bone entirely at this Government with regard to the layout at Brisbane Airport-in accordance with the advice of pilots who warned that the main runway would not be suitable for many of the operations at Brisbane Airport, on Monday 11 April 1988 the first of the major diversions due to cross-wind component. A Qantas flight had to divert, along with other flights, because it could not land on Australia's newest, longest by degrees, main runway-the new main runway at Brisbane Airport-because of the cross-wind component, within the first four weeks of operation of this very expensive new airport. I do not entirely blame this Government for that particular decision. I think it is fair to say-- Mr DEPUTY SPEAKER(Mr Mountford) —Order! I ask the honourable member for Farrer to come back within the terms of the Bill. I realise that the Bill allows for a fairly wide-ranging discussion, but I think he is going beyond the terms of the Bill. Mr TIM FISCHER —Therefore I will not dwell on that but I do accept that air safety is very much central to the Bill and diverting aircraft in high wind conditions where they would be much safer on the ground is relevant. I just make the point that the Department has a very big responsibility to bear with regard to the detailed end situation which has been reached with the new Brisbane Airport, as my colleague the honourable member for Gilmore (Mr Sharp) and other members have pointed out at length and will point out in the course of this debate. Might I just add on the radar question, which is central to the legislation, that we have reached the stage where the new equipment in Melbourne I understand is already outdated. Let me move on to deal with clauses 25 and 26 of this legislation and non-scheduled flights by foreign aircraft into this country. The Bill lays down some comprehensive provisions for this. It is as well that it does because in the prevailing situation we hear of some comprehensive reports with regard to flights into Australia by unscheduled aircraft, particularly at night time, possibly bringing drugs into Australia, planes as big as DC3s being reported as travelling into old airstrips in northern Queensland and possibly the northern part of the Northern Territory. This has caused concern to the Government and to the nation. It is my hope that under the provisions of clauses 25 and 26 we will not only have in place the right rules to deal with these unscheduled flights into the northern parts of this country, but also the Government will follow up in practice the interception of the quite significant aircraft movement that is obviously going on for illegal purposes of one kind or another, with particular reference to the bringing of drugs into Australia. I believe it is very important that the Minister address this area. It will be recalled that the Government broke down in relation to the Amman Aviation Pty Ltd saga in terms of maintaining northern surveillance. It is essential not only that the rule is right in terms of this Bill but that in practice the Government has the capability to intercept these flights and to take the legal action necessary and apprehend those who are participating in these flights. I want to say finally with regard to this legislation, which is rather hasty, which the honourable member for Ryan (Mr Moore) has indicated is wanting in so many other jurisdictions, and which the Opposition is opposing, that under this legislation there are specific clauses dealing with interference with crew or aircraft and that of course relates to the matter of hijacking. I will not dwell on the present situation but I believe I am duty bound to raise it on the floor of this House, that Mr Michael Mansell, by his proposed Libyan visit, is paving the way for hijacking of aircraft within Australia. Mansell's associations with the likes of the Libyan Leader, Colonel Gadaffi, will only pinpoint Australia for Gadaffi's terrorist activities. I do not happen to believe that Michael Mansell is representative of the Aboriginal community, although he has obviously got public funding by degrees from the Australian Government for his modus operandi. Therefore the Australian Government does have some involvement in this matter. I just want to say that Libya has sponsored conferences on terrorism, conferences on hijacking methodology, and to establish some form of increased linkage with the Libyan regime with its methodology is directly to place in jeopardy Australians and others using aircraft across Australia by the type of horrific terrorism that is implemented in the hijacking of aircraft. Mr DEPUTY SPEAKER —Order! I ask the honourable member not to proceed along those lines. They are outside the terms of the Bill. Mr TIM FISCHER —Mr Deputy Speaker, clause 24 states quite clearly that a person shall not interfere with a crew member. I conclude in regard to this dimension of the legislation by saying that no-one wants to see an outbreak of hijacking in the Southern Hemisphere, least of all in Australia. The Government has important responsibilities in ensuring that everything humanly possible is done to prevent the hijacking of aircraft, and the provisions of this Bill address that question. I sound a note of warning to the Government and the nation that, if the visit of Michael Mansell to Libya takes place-and I will not further refer to that matter-the prospects for the safe movement of aircraft in this country will be jeopardised. Finally, let me say that since the Government introduced a ban on smoking on domestic flights there has been the odd incident where people have actually tampered with the smoke detectors in the toilets on aircraft. I understand that that has been a minor occurrence, but on at least one flight about which I know, in the week following the introduction of the ban on smoking, a person was found to be smoking in the toilet and, furthermore, the alarm was tampered with so that it would not register in the cockpit and so that the flight attendants would not be aware of the occurrence. However, once the door was opened the smell was noted by many other passengers travelling on the aircraft. Those who would go down that very dangerous path should be aware that they face a penalty of $5,000 or imprisonment for two years, or both, under the provisions of this legislation. I must say that I support that heavy penalty, because such action places in jeopardy the lives of everyone on the aircraft. Let those who smoke in the confines of toilets on domestic flights be aware that anyone who interferes with the smoking alarms that have been installed in virtually all toilets to detect smoking are placing in danger their lives and the lives of other passengers. The Opposition views this Bill as a hasty legislative approach to the massive problems faced by civil aviation, and for that reason the Opposition opposes it. Dr CHARLESWORTH(Perth)(10.58) —Mr Deputy Speaker, regarding the note on which the honourable member for Farrer (Mr Tim Fischer) concluded his remarks, I would like to point out that you were responsible for the decision in the Caucus to ban smoking on commercial flights in this country. Indeed, one of the remarkable things about that decision is the degree of compliance and acceptance exhibited by air travellers in this country. For those of us who travel a great deal, it has been a step forward, and one which we appreciate. I am sure it is a landmark decision for those who oppose smoking in public places. I believe it will have beneficial effect for the whole of our community. I endorse the comments of the honourable member for Farrer on that issue. However, I must say that I take exception to one or two of the other things he said. In considering this legislation, I was under the impression that it related to the establishment of a Civil Aviation Authority by the Government and that this enabling legislation gave the Authority operational responsibility for air traffic control, flight advisory services, communications, navigation and surveillance systems, and rescue and fire fighting services at airports. In addition, it provides for an aeronautical information service and the organisation of aviation search and rescue services. Indeed, those aspects of the Authority were outlined by the honourable member for Ryan (Mr Moore) in his contribution. The Board of the Authority will consist of nine members and there will be a number of advisory committees consisting of members of the industry. Interested parties will also be part of the structure. Unfortunately, the honourable member for Ryan, in what was a typically negative and visionless contribution, indeed a very inflexible one, said that this Bill was badly thought out, that the Authority would be less efficient and less accountable than the previous structure, that there would be a more expensive structure, and that the Minister was reneging on his responsibility for oversight of safety. As usual, honourable members opposite complained that there had been no consultation. They complained that, while this issue was raised in September 1986, there had been no consultation, but at the same time they said that the Government had been too hasty. Indeed, as always seems to be the case in these issues, the Opposition cannot get its act together. Honourable members opposite complained that there would be a decrease in accessibility to the Department yet at the same time they complained that previously the Department had been inaccessible. It seems that whatever structure we determine, whatever way we decide to go in managing aviation in this country, the Opposition is not satisfied with what will happen. Concerns were expressed about the costs of the new Civil Aviation Authority. Indeed, I suppose they are reasonable concerns, but that is all they are. If honourable members understood what is happening within the Department at present they would also understand that there is almost 100 per cent cost recovery in all those areas in which the Department will levy costs on the industry. Indeed, those areas relate particularly to the setting and provision of services-air traffic control, flight crew testing and other services. The setting and monitoring of safety standards will be paid for by an allocation under the Budget. The Civil Aviation Authority will undertake those activities under government contract. There will not be a significant change and, therefore, there should not be a significant change in the cost structure. Indeed, the Authority will be accountable for its actions. It will be necessary for the Authority to establish a financial and corporate plan, and financial targets and performance indicators will be taken into account. The financial plan may have to be varied according to circumstances, but it will not be an open-ended runaway authority. It will be possible for the Minister to vary or disapprove charges. Indeed, the Prices Surveillance Authority will scrutinise those charges. On top of that the Authority is establishing advisory committees and in its extensive consultations will be talking with those in the industry and with consumer organisations, and I doubt very much whether many of the concerns raised by the honourable member for Ryan have any substance at all. Indeed, it is likely that there will be significant changes in technology in this area. That is already occurring. The honourable member for Farrer raised one or two questions that I believe deserve a satisfactory response from the Minister. It is likely that there will be significant technological changes that will bring about cost savings and substantial improvements in the efficiency and effectiveness of the existing surveillance and air traffic control measures. That brings me to what is perhaps for those who travel on aeroplanes or any sort of public transport one of the most important issues, and that is safety. Indeed, as a number of speakers have said, Australia has an outstanding air safety record. While we can pat ouselves on the back for that, I believe that the points that have been made are valid. We have very good weather in Australia, the terrain is perhaps much less forbidding than that in many other countries, we have lower population densities and our pilot training is of a high standard. For all those reasons, we should have a very good safety record. It is important that we continue to maintain that record. Concern has been expressed in all sorts of areas that the deregulation that the Government proposes will in some way operate to the detriment of our safety record. It is salutary to look at the results of some experience overseas. In the United States, in the nine years since deregulation occurred in 1978 there have been 26 significant crashes, with a total of 960 deaths. It is interesting that in the eight years before 1978-a shorter period-there were 38 crashes and 1,455 deaths. So in the United States it seems that there has been no increase in the number of fatalities since deregulation, although I am not saying that that situation is necessarily a result of deregulation. However, when one considers that 60 per cent more people are flying now than flew in 1978, the figures are even more compelling in suggesting that there need not be any falling away in safety standards because of deregulation. I remember, when I was a student, one of my teachers continually talking to us about survival. A phrase he used was: `The price of life is eternal vigilance', and when it comes to safety in the air that is clearly the case. It is necessary for us to ensure that the operation of air traffic control and flight advisory services and regulation of the aircraft and its crew come under the same roof, because those two areas of function are complementary to each other. Indeed, overseas experience shows that the body that sets the standards and the one that is responsible day to day for the operation and for regulating that control are most efficient and effective if they come under the one roof. So it is appropriate that those functions be transferred to the CAA and that the Authority be responsible for them. In the second reading speech the point is made clearly that the primacy of safety over commercial considerations must be observed by the Authority at all times. The Bureau of Air Safety Investigation will remain within the Department and be directly responsible to the Minister and therefore to this Parliament. It will not thus be necessary for the Authority to judge its own performance, and that is entirely appropriate. It is also important that aviation security be under the control of the Department. Indeed, presently a report of the task force is pending on the future of aviation security. The honourable member for Farrer has mentioned the threat of hijacks. The risk of interference with aeroplanes is a matter we would all like to see eliminated. Of course, it is hoped that this legislation will provide a more efficient and effective functioning for civil aviation in this country. We intend to establish this Authority bearing in mind the cost considerations and, most importantly, the safety considerations involved with civil aviation in this country. I have pleasure in supporting the Bill. Mr JULL(Fadden)(11.09) —I am somewhat concerned about just where this Civil Aviation Bill and the establishment of the Civil Aviation Authority in this manner will take us. Unfortunately, the previous speaker, the honourable member for Perth (Dr Charlesworth), did not allay too many of my fears as to the direction in which the Bill will take us. I extend my sincere congratulations to the honourable member for Perth on his comments about safety standards in the United States following deregulation. When I have raised this issue in the House previously, I have been howled down by members of the Government saying that deregulation equalled unsafe air practices and that the United States was the great example. The honourable member for Perth is right: there has been no reduction in safety standards in the United States. In terms of the figures he quoted-and they are correct-it would seem that the situation has improved. I hope that in future other members of the Government will take these facts on board when they enter some of the debates on aviation we have from time to time. When the Government first decided to set about establishing a Civil Aviation Authority, quite frankly I was pleased with that decision. It seemed to me that that was probably the logical way to go. Civil aviation authorities existed in most Western countries and had worked quite successfully. One of the great difficulties I have with this legislation is my inability to find out just how far it will go and just what are the real implications. I join the honourable member for Ryan (Mr Moore) in saying that some of the information available to the Opposition and the industry has been scant, to say the least. We should press the Government to let us know more about this matter, especially in light of the fact that the establishment of the Civil Aviation Authority is already taking place and is expected to be completed by 1 May. It is only a few days to 1 May, yet we do not have answers to our questions. The Opposition has some real areas of concern, one being just what the new aviation authority will deliver us if it is set up in this form. What worries me is that it appears that we will get the same people in the same jobs with the same terms and conditions of employment as we have had previously. We really have no answer to the question of exactly where the cost savings will be made. From reading the legislation and the Minister's Press releases, it would appear to me that it will emerge after the establishment of the CAA that air transport will cost the Australian travelling public a great deal more than it does today. It would not be unfair to highlight in terms of staffing what has happened with the Federal Airports Corporation (FAC). One thing that distressed me was that a staff ceiling limit was placed on the Corporation of, I think, 1,200. Already staffing of the Corporation is up to 1,600-400 over. What sorts of control will apply to the number of staff members associated with the new CAA? In areas such as air traffic control, what benefits will really accrue? Are we really convinced that establishing the CAA in its present guise will make air traffic control handling at, say, Sydney's Kingsford-Smith Airport any better than it is now? Is there any real indication that there is a dedication from the people going over to the CAA from the old Department to carry out a major investigation of procedures, and will the staff adopt them? What will be the nature of the Board of the CAA? It would seem to me that it will be pretty top heavy with members of the Public Service. Why are airline representatives not involved with the Board and management of the new CAA? Although we have heard from the Minister that there has been consultation with the industry, I have found from speaking to representatives of the industry that the biggest criticism they have is that they have not really been consulted and do not really know what is going on. It is also fair to say that there is a real fear in the industry about how the cost recovery program will operate. The matter of revaluation of the assets has already been mentioned in the debate. It is true that some of those assets-and we have very valuable pieces of property and facilities-have been there for a long time and have been written down and paid for. Will we go through the whole procedure whereby they are revalued to the extent that assets were revalued by the Federal Airports Corporation? As I understand it, when that initial transfer came about, the assets were valued at about $250m. I understand that there has been a revaluation and the assets of the FAC now stand at $1 billion, and some sort of cost recovery program is being considered to cover almost $800m. That translates into further costs to the industry of about $100m per year. Will that also exist in regard to the revaluation of the CAA assets? What does that mean? Very few people on this side of the House would argue against the principle of `user pays'. For how much longer can the consumers of Australia continue to pay for this very expensive operation that has been gone through by the FAC and, quite possibly, will be gone through by the newly established CAA? What other areas will be looked at in terms of savings? There is a great deal of concern, for example, within the industry regarding the cost of providing the fire fighting services. Will that really be looked at or does this direct transfer of the same personnel mean that the present situation will prevail? These are truly the areas about which we on this side of the House must continue to express our concern. I think that the principle of the CAA is probably right. The structure of the CAA as presented by the Government in this legislation leaves a lot to be desired. As I say, I think the real problem that I face is that I understand it to be a much more costly operation for the airlines and the users of these systems. Obviously, that will be passed down to the consumers. This is occurring at a time when, more than ever before, we should be looking at trying to get those costs into true perspective and trying to provide the cheapest possible air services, not only for the development of air travel within Australia but also as an added inducement for the continuing growth of tourism, especially international tourism to this country. If we continue along this line the path could be fraught with danger and with the prospect of even greater costs for the consumers of Australia. Therefore, reluctantly, I will have to vote against this legislation. I am sorry that this has happened because I thought that there was some real potential for the establishment of the Civil Aviation Authority as an independent body. But that independence does not appear to be there. Quite frankly, we seem to be stuck with the same personnel in the same positions under the same Public Service contracts, run by a board that is dominated by the Public Service. I really wonder what the Government is hoping to achieve. Mr LEE(Dobell)(11.18) —I was disappointed to hear the final comments of the honourable member for Fadden (Mr Jull) who usually makes a very considered contribution to debates in this Parliament on tourism and air travel. I am disappointed that the Opposition apparently has decided to oppose the Civil Aviation Bill 1988 because in many ways it is the sort of legislation which should receive bipartisan support from all members of this House. The reason I say that is I believe this Bill is simply a mechanism for improving the efficiency of Australia's airline industry. It seeks to establish a new Civil Aviation Authority (CAA), an independent statutory authority which will have responsibility for areas such as air traffic control, flight advisory services, communication and navigation, and the rescue and fire fighting services which were mentioned by the honourable member for Fadden. I believe that the Minister for Transport and Communications (Senator Gareth Evans) is correct in seeking to place these responsibilities in the hands of an independent statutory authority rather than leaving these day to day decisions in the hands of a department of state. There is evidence that statutory authorities have in the past been more efficient in operating in areas such as this. I am disappointed that members of the Opposition have had to seek to find some reason to oppose this Bill. I really do not think their hearts are in it. I hope that before this debate is over they will reconsider their position. In regard to the criticisms by members of the Opposition, so far they have said that there has not been enough consultation with the industry about the establishment of the Civil Aviation Authority. The Minister for Transport and Communications, Senator Evans, publicly announced on 7 October last year that the Civil Aviation Authority would be established. Yet the Opposition claims that there has not been enough time for the industry to be involved in consultation. The fact that the announcement was made last October demonstrates that that is incorrect. In addition, the Opposition has said that the industry is concerned about the extent of cost recovery. I suppose it is quite natural for anyone involved in the commercial side of the aviation industry to be concerned about any cost implications. The last figures that I saw show that only 15 per cent of Australians had ever flown, which is a surprisingly low figure. Because only a small percentage of Australians use the airline industry I think that we should not be placing an economic burden on the taxpayers of Australia as a whole to subsidise the air travel of that small number, 15 per cent or less, who fly regularly. It is important that we make sure that our airline industry has the highest safety standards and yet is run efficiently, in a lean and cost-effective manner, because the tourist industry is greatly dependent on the cost structure of the airline industry. Given that the number of overseas tourists visiting Australia is expanding rapidly-to a large extent due to the efforts of the former tourism Minister, the honourable member for Parramatta (Mr John Brown), and other people such as Mr Paul Hogan and the fact that the excellent campaigns run by this Government overseas have had a great deal of success-it is important that we make sure that our airline industry, and in particular our airports, can handle the massive expansion which is continuing to take place. Every time overseas tourists come to Australia they spend money and help to create jobs in Australia. I read somewhere that the average Japanese tourist earns Australia approximately as much export revenue as would 60 tonnes of black coal. I am not sure how accurate that figure is, but given the number of Japanese tourists who appear to be landing in Sydney these days, I am sure that that is certainly helping our balance of payments situation. It is not fair to expect the ordinary taxpayer to subsidise the cost of our airline industry. It is not fair to expect the overwhelming majority of Australian taxpayers, who do not fly, to subsidise the cost of air traffic control and the fire fighting services at airports. A great deal of time has been spent in discussing the question of safety. Of course, the new Civil Aviation Authority will have responsibility not only for setting the standards which will apply to our Australian industry but also for policing them. As the honourable member for Perth (Dr Charlesworth) rightly said, it is commendable that the body which sets the standards will also police them, because it is more likely that the Civil Aviation Authority will do a tighter job in policing those standards. Australia has an enviable record as far as air safety is concerned. This is not only due to the Australian Government over many years setting very high standards but to a large extent it is also due to the fact that Qantas Airways Ltd, Ansett Airlines of Australia, Australian Airlines and most of the smaller general aviation airlines have maintained very high standards of maintenance. I recall hearing that whenever Ansett or Australian Airlines decide that a particular plane has come to the end of its economic life and they wish to sell it overseas or to another company, they always receive very high prices because other airlines know that Australia has very high maintenance standards. They are prepared to pay a premium if they know that a plane has been flown exclusively in Australia and has been maintained to those very high safety standards. The airlines should be commended for maintaining high safety standards over many years. They should realise that all of us on both sides of this House expect those very high safety and maintenance standards to be maintained in the years ahead. The honourable member for Fadden again made a point which he has made previously in debates in this House. He said that in his opinion deregulation in the United Stated of America has not resulted in any decrease in the safety standards in that country. The honourable member for Perth quoted some figures demonstrating that the number of people who have died as a result of aircraft accidents has fallen since deregulation occurred. I question the validity of using that as a fair measure of the safety standards in the United States. Given the number of passenger trips in the United States, simply to pluck out the number of people who died over a nine-year period is statistically not a fair measure of the safety standards in the United States. I am aware that there has been a massive increase in the number of fines which the United States domestic aviation authority has levied on United States airlines because they have been found to be not carrying out the proper maintenance of their aircraft. I believe that that is the direct result of deregulation of the United States airline industry. As a result of price wars airlines have been placed under great financial pressure and have had to shave their margins. Some US airlines made the decision that they would cut back their maintenance. A small number of airlines also made the decision that they would not carry out the essential maintenance which is recommended by the manufacturers of those aircraft. I believe that any comparison of the number of fines which have been levied on United States airlines since deregulation, compared with before deregulation, will demonstrate that there has been a reduction in the safety standards in the United States since deregulation occurred. That is why it is so important that this Bill is before the House today. Our Labor Government has taken the decision to abolish the two-airline policy. This Parliament carried a resolution last year to give notice of the termination of the two-airline agreement. So it is very important that we establish a body such as the Civil Aviation Authority to control independently the safety standards which are enforced in the Australian airline industry. We must ensure that while Australia's airlines are forced to provide air travel at the cheapest possible price, that they do not cut the safety standards which they should apply both in maintaining their aircraft and in the operational procedures which are followed by those aircraft. The honourable member for Farrer (Mr Tim Fischer) made a few remarks about the threat of hijacking in Australia. I endorse his comments and make the further remark that I believe that the Government has increased the number of baggage inspections and the use of metal detectors for passengers boarding aircraft. I hope that the Government will continue to expand the numbers of items of equipment which have been installed in airports so that within a short period we can ensure that every Australian who boards an aircraft at one of Australia's major airports does go through a metal detector and have his baggage inspected. I think in that way we can ensure that Australia is not some sort of a weak link for those people who wish to use terrorism to extract some sort of blackmail. Finally, I commend the Government for the work it is doing at Sydney international airport. Many people say that Sydney Airport-to use that hackneyed expression-is a weak link in Australia's current system of airports because of the fact that its capacity is close to the maximum traffic which can be handled at Sydney. I commend the Government for deciding to spend over $10m on improving the taxiways at Mascot Airport which allows aircraft to enter and exit the taxiways more quickly without having to come to a complete halt. This enables more aircraft per hour to use the main runways. In addition, $20m has been allocated to upgrading the radar services at Sydney international airport. At the moment there are three operational radars and two are to be commissioned during this year, including a surface movement control radar which is currently being handed over at Mascot. Again, that will help to ensure that we can use Sydney International Airport as efficiently as possible. But we should not forget that whilst Sydney International Airport certainly comes under a lot of pressure, it is usually under pressure for only a very small period each day. The largest number of jumbo jets and Boeing 747s take off and land at Sydney International Airport early in the morning and late at night. As a result the facilities at Mascot are not fully utilised most of the day. That is why I commend the Government's decision to introduce over time a pricing policy which encourages general aviation aircraft to use Sydney International Airport during the off-peak periods. In the long term this Government has taken the historic decision to build Sydney's second international airport at Badgerys Creek. That will be the long term answer to Sydney's airport needs. For some reason overseas tourists wish to travel to Sydney to see one of the greatest cities of the world. They are not that keen on visiting places such as Melbourne, although I notice that an increasing number of overseas tourists appear to be visiting Queensland. I am sure that that is very helpful to the Queensland tourist industry, but I believe that the Government has a responsibility to ensure that funds are allocated at Badgerys Creek so that by the turn of the century we have a modern, international airport at Badgerys Creek which can handle the massive numbers of tourists who are already seeking to spend their tourist dollars in Sydney. Mr Millar —They want to go to Sydney, not Badgerys Creek. Mr LEE —As the honourable member suggests, they wish to go to Sydney, not Badgerys Creek. Given the fact that it takes two hours to travel from Narita International Airport to central Tokyo, I am sure that they will be quite happy to spend less than an hour travelling from Badgerys Creek to the centre of Sydney. Given the fact also that many of the major ring roads in the Sydney arterial road network pass near Badgerys Creek, I am sure that our decision to build the second international airport at Badgerys Creek will prove to be one of the best decisions that this Government has taken. I am happy to support the legislation before the House. Mr MILLAR(Wide Bay)(11.32) —In addressing the Civil Aviation Bill which is designed to establish a Civil Aviation Authority, I firstly take up the comment made by the honourable member for Dobell (Mr Lee) which is quite accurate. He alluded to the premium track to aircraft on the Australian register, regular public transport aircraft in particular, on disposal to foreign interests. That premium is attracted by the extremely high level of maintenance required under the Air Navigation Orders and the Air Navigation Regulations or, in short, the Department which has been responsible for these activities over a long time. If we have achieved that happy circumstance, if we enjoy, without dwelling on the extraneous reasons for so doing, the highest safety record in the world, one could fairly ask, `Why the need for change? Why move things sideways, establish a quango to achieve that which demonstrably thus far has been achieved with outstanding success?'. Is this just another instance of shuffling to and fro, reaching for unattainable heights, something which, in the end, might be described as an exercise in horizontal arabesque, much activity and no demonstrable benefit in the ultimate? The Opposition is not instantly attracted to this particular proposal which brings with it the risk of further empire building- a pernicious characteristic of bureaucracy. I say that without any antagonistic overtones, having been a proud Federal public servant for quite a number of years further back than I care to remember, but I have a feeling for the job the airlines have to do. They have achieved all that which the Australian public and the industry would have expected in terms of aircraft safety. There is a continuing disenchantment as to the sharing of the costs attaching to the provision of this infrastructure. It is a very costly business. Again, as the honourable member for Dobell said, there is nothing more useless than a very costly airport facility if it is not being used by aircraft at any given time. It links somewhat with the airman's understanding that any runway behind him, whether he is taking off or landing, is of no further use to him. The same could perhaps be said of an airport which is not at any given time being used for its purpose. Aviation facilities are a very costly asset to this country and it is understandable that there might be an inclination to establish a cost recovery system which would mitigate to some extent the heavy imposition on the taxpayer, borne cheerfully or with a varying degree of enthusiasm, in respect of a whole lot of activities which governments, in the order of events, seek to provide. I am concerned that, in metaphoric terms, we are charging into this proposal-we are renowned, of course, for never charging in any meaningful way into anything; it seems to take an inordinate time from the germ of the idea to its implementation-while we are not yet satisfied that the proposal is well based. The Minister for Transport and Communications (Senator Gareth Evans), in announcing the Government's intention to set up the Authority, said: The operation of air traffic control and the flight advisory service is as much a part of safety regulation as the regulation of the aircraft and its crew. The two areas complement each other. I am certain that the departmental officers who have made such a splendid contribution to our aviation safety in the context of integrated safety and operational functions within the Department will continue to do so in the new Authority. Again, the question arises: Why? We just cannot move 7,000 people out of an established department and put them into a new authority, a quango, without attracting a very substantial cost for its establishment in simple physical terms. Those people are being exorcised, if you like, and there must by some shelter to accommodate them, with restructuring at various levels. On the Minister's own proud statement, the doubt as to the essential merits of the proposal again come into stark focus. It is quite possible-I am not presuming the outcome of the Bill's consideration in the Senate-that the Civil Aviation Authority will come into existence, notwithstanding arguments advanced as to why that should not be so. As I say, we are charging into this. Quite often we find that measures embarked upon with great enthusiasm prove in hindsight to be of less merit than was imagined in prospect. I rather thought that the Minister for Transport and Communications Support (Mr Peter Morris), with some flying experience to his credit, would be aware -- Mr Braithwaite —A short take-off. Mr MILLAR —A short take-off, as the honourable member for Dawson says. Honourable members can place their own constructions on that remark. The Minister should be fully aware that, if one seeks to attain heights beyond the capacity of one's aircraft, the angle of attack becomes too great and the aircraft will inevitably stall. I wonder whether the Minister is not embarking now on such a flight into fantasy. If that is the case the Authority will have matters to consider. In this fairly wide-ranging debate this morning I have heard a number of worthwhile contributions and comments about various facets of the aviation industry. I heard comments about passenger security and airport security. Sadly, in this world today, that is becoming an increasingly important requirement. As a regular passenger transport user, I am a little mystified to discover that there is a significant variable in the security checks at respective airports. I wonder why, in the same configuration-for want of a more precise term-I can walk through a detector at one airport without raising a beep and at the next airport raise more than a beep, almost a scream of protest. The officer in attendance will subject one to an examination with a hand detector to the point where one becomes increasingly overwhelmed with embarrassment as everybody in the airport terminal concentrates his gaze, convinced that at last a security threat has been found. Apart from the matter of personal embarrassment, the question arises: Why is there quite clearly a disparity in performance between what, notionally at least, should be identical security check facilities? The Authority will have to look at that. The Authority is to assume responsibility for air traffic control. Again, this is something which has notional difficulties but which, certainly on the statement of the Minister, has been managed effectively by the Department hitherto. Yet one finds at different airports at different times a lack of consistency in the handling of air traffic by duty controllers. One cannot sit at an airport for 24 hours to see whether the pattern is constant throughout the 24 hours of the day or whatever period in which the airport is operating, but it is quite clear that in some situations, in the view of seasoned travellers and those who have first hand experience in the handling of aircraft, the sequencing of flights should not be as much of a variable as it proves to be at times. There seems to be scant regard on occasions for different aircraft types and their movements. The essential sequencing for safety reasons between departures to accommodate wake turbulence varies according to the conditions prevailing-wind factors and so forth. It is frustrating in the extreme to be sitting in an Airbus, holding at a taxi point awaiting clearance to line up, and see in the distance the lights of an approaching aircraft at an estimated 10 miles on long final and to find out a considerable time later that one has been waiting for a twin engined commuter aircraft-a Navajo or something of the sort-which has a negligible wake turbulence factor, that there are not other movements on cross runways and there is nothing taxiing. To the conditioned observer, let alone the trained or skilled observer, it is quite clear that air traffic controllers at a given time will maintain a degree of separation which is altogether different from that which may be maintained in another place or at the same place at a different time. There must be some consistency. If that sort of anomaly or phenomenon is attributable to the lack of experience of an air traffic controller at a given time and he is factoring movements to ensure that he does not err, that would give rise to considerable concern. The question of air safety, of course, is possessed of the elements of motherhood. We believe in it; yet, as the honourable member for Kalgoorlie (Mr Campbell)-a member of the Government-pointed out this morning, there is arguably an incredible sum of money directed towards avoiding accidents or attending accidents in the aircraft movement area. He put the point quite reasonably and persuasively that we seem to have a different philosophy towards those who travel in aircraft and those who travel by other modes of transport, particularly on the road. Day after day we are confronted with horrendous statistics of people who have suffered injury or death on the roads. We become, sadly, almost blase about them; yet we seem subject to a compulsion to spend millions of dollars on maintaining a service, both in safety and rescue, including fire fighting facilities, which sit year after year at considerable cost when they are rarely utilised in a situation for which they are intended. I am not suggesting for one moment that we vacate that area, but one must make a judgment-a philosophical judgment if you like: a subjective judgment-as to how far along the road we can go in terms of expenditure to accommodate that which might be regarded as desirable but which by any pragmatic measurement is not really attainable. It is a misallocation of resources. The honourable member for Dobell also touched upon deregulation. Statements were made to the effect that deregulation has not resulted in any abuse of standards of air safety, aircraft maintenance and the like. I think the statistics extrapolated from that circumstance as to the number of accidents that have occurred post-deregulation as opposed to those that occurred pre-deregulation are totally unreliable. I must say that I am totally unattracted to the suggestion implicit in giving the figures that in deregulation we have no reason whatsoever to feel a concern about abuses that might arise under economic pressure where airlines are struggling to survive. An airline does not go out of business at 5 p.m. on a Thursday. It will go out of business over a protracted period, several months, while it struggles to remain viable before it is, usually, bankrupted. I read a report from the United States of America which stated that a 727, I think it was-an aircraft of similar type-had made 19 regular public transport flights beyond the mandatory period for maintenance. They were illegal flights. I have a passing sympathy for operators of the airline. They were trying to stay afloat, and human nature is such that there is an almost irresistible tendency to cut corners or take a chance. This is quite intolerable in this area. To my knowledge, this has not been the case in Australia-under the tutelage of the Department, not some abstruse quango which may or may not do the job; that remains to be seen. I think we have to address ourselves to maintaining our record. I cannot accept that the Department as presently structured lacks the talent or the will to do that which must be done. It may be possible to energise it to a greater extent. I do not wish to be peremptory in my judgments on that score but I would be surprised indeed if the Department were climbing at full throttle in this area. I think the matter should stay with the Department and it should address itself urgently to maintaining Australia's proud history in the aviation world. We are pioneers of flight. The records of international flights feature very largely the names of Australians whom we remember very proudly. I think general aviation should be the Department's first priority in terms of relief from cost recovery. We should do all we can in a country of this character to ensure that general aviation is a burgeoning activity. There is a spin-off benefit for defence. We could relate it to the predicament we are now confronted with with the defence forces being seriously depleted by transfers to Qantas Airways Ltd and other airlines for reasons that are self-evident. I think general aviation should be based on a cost structure which means that very few Australians who are minded to take to the skies are denied that privilege and that benefit. As I said in the first place, the Civil Aviation Authority may well be implemented but there is little reason for the Opposition being enthused about that prospect on the evidence presently before it. Mr DUNCAN(Makin-Minister for Employment and Education Services)(11.49) —in reply-I thank honourable members for their involvement in this debate. I heard quite an amount of it and I appreciate the concerns that have been expressed. I think they were expressed genuinely and sincerely. Particularly in the case of the contribution of the honourable member for Wide Bay (Mr Millar), I do not think he was in any way being political about this matter. In fact, the Civil Aviation Bill is not a Bill which might be said to divide us on ideological or any other grounds of that sort. These are matters for judgment. The Government believes that we have made the correct judgments in relation to the decision to set up the Civil Aviation Authority (CAA), with which I had some involvement, of course, a little while ago. I want to go through the main issues that have been raised by honourable members. Of course, I am as concerned as other members about safety in particular. This matter has been considered at great length within both the Department of Transport and Communications and the Government to ensure that in moving towards the establishment of the Authority we get it right, that we make the best decisions in relation to safety. The Minister for Transport and Communications, Senator Gareth Evans, made it quite clear in his October statement that safety regulation would continue to be of paramount importance and the Authority will be required to give primacy to safety considerations over commercial ones. That was made clear also in the second reading speech. The Government is committed to seeing that the bodies responsible for standard setting, operational control and safety investigation will be able to ensure that safety regulation and surveillance are in no way diminished, and to the extent that the industry has been calling for some time for the Bureau of Air Safety Investigation to be separated from the regulatory agency, that is being achieved in this Bill. That is an example of the Government responding to concerns in the industry. Additionally, in considering appointments to the board of the Authority, the Government will be looking to ensure that an appropriate range of expertise is included. Senior operational and technical experts of the Authority will be eligible for appointment and in making those appointments the necessary safety considerations will be taken into account. The Authority is empowered to establish advisory bodies, and should the board decide to establish one or more bodies there would be scope for industry representation, thereby ensuring that it has a direct input into discussions of the nature and extent of services which the Authority might provide. Considerations such as safety particularly could be taken into account in setting up those bodies. Some honourable members raised the issue of whether there was a need to establish such an authority, and I should like to make a couple of points in relation to that. As was outlined in the second reading speech, it has been the policy of successive governments that costs should be recovered from the industry and, given this policy, the body providing the services should be so structured as to make it what could be described as adequately responsible to industry's requirements and to industry's capacity and willingness to meet associated costs. Departments of state are of necessity bound by government processes which reduce their capacity to perform with the responsiveness and flexibility of an authority operating along commercial lines. The penalty for this constraint has generally impacted upon the level and timing of investment in infrastructure and upon costs both to the industry and to taxpayers. I am sure honourable members who have airports in their electorates would know the sort of thing I am talking about. Advances in technology, particularly in the communications field, offer the potential to develop a more cost-efficient airways system through a major program of investment. The Authority will have far greater freedom and control over financing of and expenditures on such investment programs than is possible within a department of state funded entirely from the Commonwealth Budget. A greater flexibility in the operations of the Authority will enable it to be more responsive to industry requirements, particularly in the planning for future infrastructure needs. We believe they are the fundamental reasons why we should have an authority rather than continue with the existing arrangements. Specifically, I think some honourable members raised the issue of why safety regulatory functions were being transferred to the Authority. They could have been left in the Department. That was an option that obviously was available. The Australian experience to date indicates that there is a strong logic in the view that the task of regulating aviation safety must be regarded as one requiring an integrated system in which all elements are coordinated to achieve maximum reliability and effectiveness. The operation of air traffic control and the flight advisory service are as much a part of the safety regulations as the regulation of aircraft and their crews. The two areas complement each other. It is noteworthy that in the United Kingdom the CAA has very successfully combined safety regulation with the operation of the airways system. This arrangement was adopted after a formal review on the basis that the setting of standards, regulatory control and the day to day operation of the airways system should be under single control in the interests of efficiency and effectiveness because of the close interrelationships involved. In contrast, the Bureau of Air Safety, as I have mentioned, will be separate from the Authority and will remain with the Department, being directly responsible to the Minister. No decision has been taken at this stage as to the composition of the board of the Authority. The legislation provides for a nine-member board, as honourable members will know. This will give the Government flexibility to ensure that appointees bring a broad cross-section of skills to the Authority. The Government will be looking to the business sector for people with expertise in financial matters and in general management. Given the Government's commitment to the primacy of the safety of civil aviation operations over commercial considerations, it has been left open for experts of the Authority to be appointed to the board also. Every effort will be made to ensure that there is a proper mix of skills at board level in the light of the particular requirements of the Authority and that adequate attention is paid to consumer interests and industrial relations aspects, which in this area are particularly important. Consistent with its policies for Commonwealth statutory authorities and government business enterprises, the board appointments will be undertaken at ministerial level. The Authority will be expected to operate in a businesslike way and to perform its role in a cost-effective manner. It is the Government's belief that this method of board appointment will lead to greater accountability, thereby ensuring that these objectives are met. Some honourable members, I understand, expressed their concern that the staffing of the new Authority is to be under the Public Service Act. Mr Tim Fischer —A lot of these issues you were raising were not raised. They are in the briefing notes. Mr DUNCAN —I understand that this is a matter of some concern to people. Therefore, it needs to be dealt with. In the introduction of the Public Service reform legislation in 1984 and the Public Service streamlining legislation in 1986 provision was made to give senior management a much greater degree of flexibility in the management of their staff than had been the case previously. The authority to move staff and to create and abolish positions was increased considerably. The Public Service Act as it now stands is considered to provide a sufficient degree of management flexibility for the Civil Aviation Authority. Given this, there are advantages in continuing to employ staff of the Authority under the Public Service Act, as present terms and conditions of employment of staff will continue to apply. This will facilitate the transfer of staff to the Authority and diminish the administrative task of the Authority in the establishment phase. This will allow management effort to be devoted to the Authority's primary tasks. The expertise that exists within the airways section of the Department exists nowhere else in the nation at present. It would be hard to gather together a body of expertise of that nature. Quite clearly, we should look to those people to provide the basis for the staff of the new Authority when it is formed. Matters of concern about costs to industry were raised. A number of controls and related matters are relevant to the question of cost containment. An important element, which was mentioned in the second reading speech, is that this legislation reflects the Government's guidelines which seek to ensure a proper balance between the need to remove detailed controls over the operations of statutory authorities, on the one hand, and the need to ensure that these authorities remain accountable for their actions, on the other hand. The Authority will be required to provide the Minister with detailed projections of its finances over a rolling three-year period, which is covered in its corporate plan, including estimates of receipts and expenditures for each year. The Minister is empowered to direct the Authority to vary its financial plan in respect of financial targets and performance indicators. The Minister also has the power to disapprove charges which the Authority might wish to levy. The impact of the charges on operators may feature in any examination made by the Prices Surveillance Authority, which is a further scrutiny adding to the discipline of cost containment. The Government will require the Authority to be responsive to the needs of industry. Indeed, the legislation stipulates that in the performance of its functions it shall consult with commercial, industrial and consumer organisations. The Bill deserves the support of the Parliament. It has been brought before the Parliament after a great deal of scrutiny and work within the Public Service and within the Government. I commend the Bill to the House. Question put: That the Bill be now read a second time. The House divided. (Mr Deputy Speaker-Mr Ronald Edwards) Ayes . . . . . . . . . . . 65 Noes . . . . . . . . . . . 49 —— Majority . . . . . . . . . 16 —— Baldwin, P. J. Jakobsen, C. A.Beazley, K. C. Jenkins, H. A.Beddall, D. P. Johns, G. T.Bilney, G. N. Kelly, R. J.Blanchard, C. A. Kent, L.Blewett, N. Kerin, J. C.Brown, Robert Lamb, A. H. (Teller)Campbell, G. Lavarch, M. H.Charles, D. E. Lee, M. J.Charlesworth, R. I. Lindsay, E. J.Chynoweth, R. L. McHugh, J.Cleeland, P. R. Martin, S. P.Cohen, B. Mildren, J. B.Courtice, B. W. Milton, P.Crawford, M. C. Morris, AllanCross, M. D. Mountford, J. G.Cunningham, B. T. (Teller) O'Keefe, N. P.Dawkins, J. S. O'Neil, L. R. T.Dubois, S. C. Price, L. R. S.Duffy, M. J. Punch, G. F.Duncan, P. Saunderson, J.Fatin, W. F. Sawford, R. W.Fitzgibbon, E. J. Sciacca, C.Free, R. V. Scott, J. L.Gear, G. Simmons, D. W.Gorman, R. N. J. Snow, J. H.Griffiths, A. G. Snowdon, W. E.Hand, G. L. Theophanous, A. C.Harvey, E. R. Tickner, R. E.Hayden, W. G. West, S. J.Hollis, C. Willis, R.Howe, B. L. Wright, K. W.Humphreys, B. C. Adermann, A. E. Jull, D. F.Aldred, K. J. McArthur, F. S.Andrew, J. N. (Teller) McGauran, P. J.Blunt, C. W. MacKellar, M. J. R.Braithwaite, R. A. Miles, C. G.Brown, N. A. Millar, P. C.Cadman, A. G. Moore, J. C.Cameron, Donald Peacock, A. S.Cameron, Ewen Porter, J. R.Cameron, Ian Pratt, M. P.Carlton, J. J. Prosser, G. D.Cobb, M. R. Reith, P. K.Connolly, D. M. Robinson, IanDobie, J. D. M. Shipton, R. R.Downer, A. J. G. Sinclair, I. McC.Edwards, Harry Smith, W. L.Fife, W. C. Spender, J. M.Fischer, Tim Sullivan, K. J.Fisher, Peter Taylor,Hall, Steele Tuckey, C. W.Halverson, R. G. Webster, A. P.Hawker, D. P. M. Wilson, I. B. C.Hewson, J. R. Woods, R. L.Hicks, N. J. (Teller) Wooldridge, M. R. L.Hunt, R. J. D. Question so resolved in the affirmative. Bill read a second time. Leave granted for third reading to be moved forthwith. Motion (by Mr Duncan) proposed: That the Bill be now read a third time. Mr TIM FISCHER(Farrer)(12.10) —I wish to address briefly, under standing order 238, the third reading stage of the Civil Aviation Bill. I refer to the reply of the Minister for Employment and Education Services (Mr Duncan) to the second reading debate. I want to place on record that that reply was in abstract. It did not reflect the debate which took place on the Bill this morning. For example, it did not pick up any of the excellent points made by the honourable member for Kalgoorlie (Mr Campbell), or the honourable member for Wide Bay (Mr Millar), on the variations in levels of security, and it did not refer to my comments on hijacking and variations in radar standards right around Australia. It was clearly prepared prior to this debate even taking place on the floor of the House, and as such it was a wrong approach. In conclusion, I reiterate that the reply was prepared in abstract to the real debate that took place on the floor of the House. It did, by accident, happen to touch on some of the aspects raised by honourable members but by and large it ignored the contents of contributions to the debate from both sides of the House. As such it tampered with the will of this House. It undermined the procedures of this Parliament, and the Minister for Employment and Education Services, who has served in two Parliaments in Australia and who is a parliamentarian of some experience, ought to be ashamed of himself for picking up a brief in the closing stages of a debate and not in any way making any effort to relate to the debate on the floor of the House on this important piece of legislation. Question resolved in the affirmative. Bill read a third time. Debate resumed from 14 April, on motion by Mr Duncan: That the Bill be now read a second time. Mr DEPUTY SPEAKER(Hon. J. D. M. Dobie) —I understand it is the wish of the House to debate the Superannuation Benefit (Interim Arrangement) Bill concurrently with the Defence (Superannuation Interim Arrangement) Amendment Bill. There being no objection, the Chair will allow that course to be followed. Mr CONNOLLY(Bradfield)(12.13) —The Superannuation Benefit (Interim Arrangement) Bill and the Defence (Superannuation Interim Arrangement) Amendment Bill puts into effect decisions made by the Government to provide for an increase in superannuation, ostensibly under the guise of an increase in productivity. Honourable members will recall that, in September 1985, as part of the accord mark 2, the Government agreed to support the claims of the Australian Council of Trade Unions (ACTU) for superannuation benefits, at that time equivalent to 3 per cent of ordinary time earnings, which would be granted to all wage and salary earners on the basis of increased national productivity. The Opposition, while supporting the extension of superannuation at that time, condemned the 3 per cent productivity agreement as yet another example of the ACTU being able to dominate Government wages policy. We said then and we have repeated since that that approach ignored the capacity of industry to pay because there is a tendency to presume that by some extraordinary accounting methodology it is possible to isolate superannuation costs from overall employment costs. The simple fact of the matter is that whether one gives improvements in terms and conditions in the form of superannuation or in the form of wages there is an additional cost to employers. At that particular time, when Australia was fighting to compete on world markets, when it was being argued that our productivity remained too low, as it still is today, we were concerned that what was effectively an obligatory 3 per cent superannuation arrangement-although the word `compulsion' was not used by the Government, and wisely so-in the real world of the interrelationships between trade unions and employers this was seen as a fait accompli virtually across the full spectrum of the Australian industrial relations scene. In addition to that there was no requirement for a demonstrable increase in productivity as the basis for the payment and we believe it denied employers the right to enter voluntarily into superannuation agreements with their employees. Subsequently, in June 1986, the Australian Conciliation and Arbitration Commission in the national wage case decided to reject the ACTU's productivity claim. However, it decided that it would ratify agreements negotiated by employers and employees for additional superannuation benefits as long as they were consistent with the Commission's own guidelines. In March 1987, in the national wage case decision, the Commission reconsidered its earlier position and decided that where the parties were unable to negotiate an agreement the Commission would arbitrate. It would award no more than 1.5 per cent of ordinary time earnings, to operate no earlier than 1 January 1988, and no more than a further 1.5 per cent, bringing it to a total of 3 per cent, to operate no earlier than 1 January 1989. With regard to the extension of the 3 per cent increase to the public sector, we said that the additional costs could not be justified, because most Commonwealth employees already had access to superannuation schemes or arrangements which were generally seen as being generous when compared with most areas of the private sector. Nevertheless the Government claims it entered into negotiations with the Australian Council of Trade Unions, the postal and telecommunications unions and the Administrative and Clerical Officers Association, which were concluded on 22 December 1987. One wonders, since we were not privy to the actual basis of these negotiations, to what extent they took into account the need to increase productivity. I think one could be forgiven for drawing the conclusion, because it was certainly consistent with Government policy, that the real objective was to provide the 3 per cent superannuation increase to all public servants, irrespective of whether there was any prior condition-namely, increased productivity-in place. Consequently, we now have before us an interim Bill. We are told that the arrangement providing for the 3 per cent is going to affect advantageously, some 75,000 public servants who, not being permanent public servants, have not in the past qualified for superannuation under the Commonwealth's Superannuation Fund Investment Trust arrangements. It is precisely for that reason that the Opposition is not opposing this Bill. It is fundamental to our approach to superannuation that the sooner we can reach the situation where all people in the work force have at least the opportunity to make provision for their retirement income, the better. The fact is that for a long time some 75,000 public servants-which covers a very wide range of services, including, for example, people who may have been on the payroll for many years but who, for various reasons, were never taken on as permanent public servants-have up till now been denied access to superannuation. We believe the fundamental issue has to be addressed, not just the question of providing 3 per cent, which is an impossibly small amount of money, which will provide no significant benefits in retirement. In fact, an analysis done of this on the basis of anticipated average weekly earnings would suggest that the benefits accruing from 3 per cent over, say, a 30- to 40-year period would total the grand sum of $18 or $19 a week. Quite clearly, in terms of the size of the current pension which is close to 25 per cent of average weekly earnings, that is not a satisfactory basis on which superannuation should be seen in the future. However, if the obverse of that argument is that we are only seeing the beginning of the 3 per cent issue and that in due course it is going to go up from 3 per cent to 4 per cent and to 5 per cent, et cetera until it finally gets to somewhere between 9 per cent and 12 1/2 per cent-which I hasten to advise the House is the sort of contribution rate one needs if one is talking about a decent superannuation scheme which will ensure that the beneficiaries have an income in retirement which will either keep them out of the pension arrangement or reduce the level of pension to which they are entitled and at the same time give them an adequate standard of living in retirement-clearly we have a long way to go. If we are seeing, as I suspect we are, only the beginning of this trend and Australian employers-irrespective of their capacity to pay, irrespective of whether or not they already have a suitable superannuation scheme in place-are still going to be required to fund a further significant increase in superannuation, without any contribution whatever from their employees, I simply put to the Government that the approach it is taking is going to ensure once again that Australia's level of productivity will not necessarily increase to the extent that it should and, worst of all, we will remain uncompetitive in world markets because of the impact that this will have on overall costs of labour. The issues are very complex and it is precisely because we are concerned at the way in which the Government has handled these issues that the Opposition wishes to move an appropriate second reading amendment. I therefore move: That all words after `That' be omitted with a view to substituting the following words: `whilst not declining to give the Bill a second reading, the House deplores the Government's failure to develop consistent superannuation policies without imposing additional taxes and its reliance for over 3 years on ``legislation'' by press release causing confusion and lack of confidence in superannuation for those planning their retirement'. Members of the House and certainly people involved in the superannuation industry are only too well aware of the fact that in May 1983 Treasurer Keating introduced a White Paper into this House and between then and late last year, when we finally had the legislation establishing the framework for superannuation management, the effective administration of occupational superannuation was on the basis of Press releases. Month after month, often conflicting Press releases appeared which caused very real consternation to those whose responsibility it is to administer superannuation in Australia. Let us look at the figures, because they tell their own story. Some 3.2 million Australians are currently in superannuation schemes and those who support the 3 per cent productivity schemes make the point that there has been a further increase of some 300,000 people under that arrangement. As I said initially, the Opposition welcomes the fact that there has been at least a notional growth in the coverage of superannuation. But let us not be beguiled by the figures, because only a few weeks ago the Australian Bureau of Statistics (ABS) came out with the figures for superannuation coverage over recent years and they contained ample reason for concern. They simply say that the growth of superannuation is now less than 3 per cent. If one accepts that there has been a substantial growth of new people coming in under the 3 per cent schemes, one can only conclude that the stability of the industry has been significantly marred by the events since May 1983, when the changes in the tax rates, anticipating increases in taxation, and general changes in the administration of superannuation have turned what was previously seen as a most stable area of policy, which had had the general support of both Government and Opposition for many years, had suddenly-like health policy, regrettably-been pushed into the front rank of political division and conflict. In that environment the Government is still claiming that superannuation is a worthwhile investment and that people should be encouraged to put their investments and their savings in that direction. Those ABS figures demonstrate quite clearly that what we are seeing is that many people are dropping out of schemes-and I am not talking about the 3 per cent schemes: I am talking about the more substantial schemes which make a contribution to ultimate retirement income. The question has to be asked, therefore: What can be done to make superannuation once again economically palatable and reliable and an attractive form of investment, so that people who go into it know, or have every reason to expect what is going to be there at the end? We simply cannot ask people in their twenties or early thirties to plan for their sixties and seventies, unless they have that fundamental stability. The sad fact is that since May 1983 that stability has simply not been there. The Opposition is not opposing all the changes that the Government has introduced in terms of superannuation administration. What we are saying is that the Government has missed some very important opportunities. In the areas of vesting, preservation and portability, for example, we find the key to why superannuation has not met and is not meeting the fundamental objectives for which tax support is provided. The level of tax support provided for superannuation is considerable. We are told by the Department of Finance that in terms of tax forgone as a result of deductabilities the annual cost is about $3.2 billion. The superannuation industry contests that figure and states that it is more like $1.6 billion. It argues, quite rightly, that that bland figure cited by the Department of Finance does not take account of the fact that, while superannuation schemes may make investments that are at that stage tax free, nevertheless the profits gained from those investments and the multiplier effect that results are subject to tax. Unless we are prepared to take into account that multiplier, the industry argues, we are taking a very short term approach. There are many other areas of government fiscal transfer arrangements where the multiplier effect is presumed to be to the advantage of the nation. That is why tax support is provided in the first place. One could therefore ask: `Why should superannuation be the exception to the rule?'. Notwithstanding that, there has been significant leakage from superannuation for far too long. This is generally referred to as double dipping whereby people can obtain tax support which works out at approximately 50c in the dollar, because the funds put into superannuation by employers attract a tax free status in exactly the same way as do wages and salaries. Therefore, notionally, a person who at retirement obtains a lump sum of, say, $100,000 will find that $50,000 is subject to significant public tax support that would not have been available had those funds been invested elsewhere. Therefore, the issue of double dipping is of profound importance in its effect on tax and equity, which are so fundamental to this issue. The Opposition remains perplexed that, when the Government had the opportunity to negotiate with the industry, as I understand it did, regarding the changes that should be made to the administration of funds, it failed to make the appropriate references. For example, it avoided the issue of existing schemes by simply saying that any changes will relate only to new schemes or to amended old schemes. The fact is that more than two million Australians are members of old schemes, under which they have the capacity to take at least their contributions plus interest every time they change jobs. While those contributions do not attract the same degree of support in terms of tax as do employer funds, they are supported, because the investment income generated from those contributions remains free of tax until final retirement at age 55. The issue is whether we have a suitable superannuation arrangement that incorporates three essential elements. First, does it provide people with adequate income for retirement? Secondly, does it reduce access to social security benefits? Thirdly, is it a scheme that benefits the nation in terms of both sociological and economic factors? One would have to say on the basis of that analysis that current arrangements fall far short of the ideal. As I said, the Government has failed in its opportunity to solve some of these problems in the past and all we are hearing at present is a debate on whether or not superannuation should be subject to additional taxes. All sorts of figures have been bandied about in the Press and other media, in Parliament and elsewhere in recent months regarding the effect on quantum payments of 15 per cent tax or 20 per cent tax and on whether the proposal put forward by the Treasury will be a mixture of the existing 30 per cent tax on lump sums and a new tax on the income generated by the investments of both employers and employees. These are matters of the greatest significance not only to fund managers, not only to the big life companies, not only to members of the Association of Superannuation Funds of Australia Ltd (ASFA), not only to people who sell superannuation, but, most importantly of all, to the 2.3 million Australians who are members of schemes. What is worse is that at least an equal number of Australians are not members of superannuation schemes. They are seeing this furore and saying to themselves, `For heaven's sake, why should I take the risk? Why should I be involved in a scheme that, because of constant changes of government policy, is so structured that I do not know what I will get from it in the end?' It is in that context that the trends indicated by the ABS figures are of the gravest concern. One must face up to that reality. Public Service superannuation is a subject of some disagreement in the community. Regrettably, no-one has ever bothered to explain to the electorate at large what it is all about and there is a perception that Public Service superannuation is significantly more beneficial than private sector superannuation. On a fund for fund basis, there is some substance in that argument. Perhaps the basic difference is that the Public Service superannuant obtains his pension share of superannuation with full indexation and, generally speaking, that is not the position in the private sector. I draw attention to that fact because it is an issue the Government must address. We are told constantly by the superannuation industry and by others that people should be discouraged from taking lump sums, the argument being that if people take lump sums they also take the benefits of the pension when they turn 65. There is ample evidence to suggest that there is substance in that argument. However, the Government has effectively done nothing through recent regulations to try to protect the public interest, to protect the pension, to ensure that people who do not have adequate income in retirement are provided for. I emphasise that the first of the three elements that should be present in superannuation is not being applied. Therefore, while they have access to a situation in which they can take benefits and a full pension, is it any wonder that people believe that it is a marvellous idea. It totally ignores the fact that 50c in the dollar of the contributions made to the generation of that superannuation fund, whether a lump sum or a pension, is taxpayer funded. The saddest part of all is that those benefits are funded significantly by the millions of taxpayers who do not have superannuation at all. The question of equity is fundamental to this issue and the Government must address that point. The point I am trying to get to is that Public Service superannuants have access to full indexation but, generally speaking, private sector superannuants do not. Until that issue is addressed it is, in my opinion, a waste of time arguing the case that lump sums should be phased out in favour of pensions. Even blind Freddy knows that within a decade what might have been a very adequate pension on the day of retirement in terms of purchasing power virtually reaches zero, if we assume a rate of inflation of about 1 per cent. It is because of that that indexation is absolutely crucial. At present, the Government is providing a number of investments by which companies and superannuation schemes can obtain access to a degree of indexation. It surprises me, however, that the industry as a whole does not seem to have made use of those methods to the extent it should. The AMP Society, for example, tells me that it could probably provide benefits that attract a level of indexation of about 4 per cent; but we all know that under current arrangements that takes us only half the distance. The question therefore is: Who will make up the rest? What products could the Government sell-as are sold overseas-which would enable schemes and individuals to take up assets that would give them some protection through indexation in retirement? The issue is so fundamental that, until it is addressed, the argument whether people should or should not take lump sums becomes absolutely academic. One of the issues which make Australia unique in comparison with the rest of the world-because no other country provides lump sums, and I emphasise that fact-is that Australians believe that superannuation is really a means of deferred income they can take on retirement, nowadays at age 55, although some would argue that that is too early. People can take a lump sum in retirement and pay off their house-a very sensible approach-perhaps help their families, or do various other things that they want to do with that sum and live on the remainder until they qualify for the old age pension. Governments must face difficult decisions in relation to these matters, but these are the fundamental issues that must be addressed if we are to make any progress. In addition there is the question of indexation, which I regard as an absolutely fundamental distinction between public and private superannuation coverage in Australia. Another important matter that the Government should address is the future of superannuation funds run by the States. The last five years or so have seen a radical change-a transformation, in fact-in superannuation coverage, which has had two major effects. First, I refer to the State schemes which were similar to that of the Commonwealth, in that they gave the employers' contribution as a lump sum and the employees' contribution as a pension. The States have finally realised what is obvious. They say, `Why should we have the cost of pensions on our books if we can transfer it to the Commonwealth?' That is precisely what they are doing. They are now saying to employees, `You will take a lump sum in retirement; there will be no indexation; there will be no choice whether you take a pension or a lump sum; there is no question of a pension'. By doing that, the States have significantly reduced the cost of providing retirement income to ex-employees. They have done that fully expecting that the cost is transferred to the Commonwealth and there they imagine it will lie. Something worse than that has happened. If one analyses the coverage of superannuation in the States one finds another trend. Whereas previously these schemes had been compulsory, as is the case with the Commonwealth, in some States that is no longer so. They are saying to new entrants-and, in the case of South Australia, to old entrants-`If you are not happy with superannuation, you can drop out'. An estimate I have seen suggests that some 33 per cent of State public servants who ought to be in such schemes and who previously probably were have now opted out. Thus we are seeing in the State public sector a deliberate intention to dilute what was meant to be the fundamental objective of superannuation-to encourage people to be independent in their retirement. The Government must use its influence in the States, particularly with those with governments of Labor persuasion, to try to bring this situation under control, because ultimately the Commonwealth Government has no other power over the States. If the Government is going to increase taxation and introduce a new tax on the income from superannuation schemes, that will not affect unfunded schemes, and all the States schemes are precisely that-they are unfunded. Again, that is one of the fundamental differences between most public sector and private sector schemes. That is one of the reasons why people ask for justification for the public sector being treated so differently from the private sector. Why should the level of benefits be more generous in the public sector than it can possibly be in the private sector, given the different operating procedures and requirements in regulations under the Act, which do not apply to the Commonwealth scheme, for example but which do apply to private sector schemes? Is it any wonder that people are less than happy about that? In recent weeks, the Opposition has moved in the Senate-and I understand the matter will be debated tomorrow-to deal with a very important question, namely, the lack of accessibility of contributors and beneficiaries of superannuation schemes to the management decisions of super funds. It seems to me that the Government has had a very cosy arrangement with the Australian Council of Trade Unions (ACTU). Incidentally, the affiliated unions are alleged to get about $1.4 billion income from the 3 per cent superannuation schemes. It is claimed they will have a total cashed up value of about $9 billion by the end of the decade. We are dealing with very large sums of money and significant economic power that can come from the management of the schemes. This is why the Opposition parties have always been concerned about the capacity of trade unions ultimately to have sufficient economic power to control management decisions of the companies in which they invest. Precisely for that reason, we are moving in the Senate tomorrow that people who are contributors or beneficiaries of schemes must have the right to elect their representatives. But the regulations do not even mention the word `election'. They talk about nomination, and do not even say who is nominating these representatives. I can tell honourable members who nominates them: they are being nominated by unions, by the big fund managers. In many cases the people who are there to represent the interests of the contributors or beneficiaries are not even members of the schemes. What is the fiduciary relationship therefore that these people have in a situation such as I have described? Is democracy now so expensive that we cannot even allow contributors and beneficiaries to have one of the most important fund raising and long term saving mechanisms in this nation-the right to determine whom they want to represent their interests? Under the companies codes every shareholder has a right to vote for members of the boards but, under this Government's authoritarian management, shareholders in superannuation schemes are being denied natural justice. Mr DEPUTY SPEAKER(Hon. J. D. M. Dobie) —Order! Is the amendment seconded? Mr Blunt —I second the amendment and reserve my right to speak. Mr PRICE(Chifley)(12.42) —I support the Superannuation Benefit (Interim Arrangement) Bill. I want to develop the proposition-although I suppose it is not really appropriate for a Government member to do this-that the Leader of the Opposition (Mr Howard) really has no choice other than to dismiss the honourable member for Bradfield (Mr Connolly) from his front bench. During my speech I will seek to outline why I believe it is vital in the interests of the Opposition that the Leader of the Opposition bite the bullet and follow my suggested course of action. The Bill deals with superannuation, a subject on the minds of Opposition members for some time. For example, not so long ago we dealt with a matter of public importance and during the debate the contrasting approaches of the two parties were dealt with. During that debate it was interesting that the shadow Minister, the honourable member for Bradfield, who has just spoken, failed to mention at all the figures that are the cause for concern-the figures of the Australian Bureau of Statistics that outline just who is participating in superannuation schemes. For the benefit of the House I will run through those figures, but not at this stage. First, I question what has happened since the matter of public importance that has caused the shadow Minister to be concerned, when he did not previously express any concern whatever about those figures. The Bill continues the historic move by this Government, and particularly the Arbitration Court, to extend superannuation to all workers in Australia. The specific nature of the Bill is that it deals with 325,000 Commonwealth employees who are eligible for benefits and 75,000 who currently have no superannuation coverage at all. Mr DEPUTY SPEAKER —Order! It being 12.45 p.m., the debate is interrupted in accordance with sessional order 101a. The debate may be resumed at a later hour this day, and the honourable member for Chifley will have leave to continue his speech when the debate is resumed. Sitting suspended from 12.45 to 2 p.m. Mr HAWKE(Wills-Prime Minister) —I inform the House that the Minister for Transport and Communications Support and Minister Assisting the Treasurer, Mr Peter Morris, left today to represent the Treasurer (Mr Keating) on Government business overseas and he will return to Australia on 30 April. In his absence the portfolio Minister, Senator Gareth Evans, will assume Mr Morris's portfolio duties, with the Minister for Employment and Education Services, Mr Duncan, taking questions in this House. I regret to inform the House that the Minister for Immigration, Local Government and Ethnic Affairs, Mr Holding, is unwell and will be absent from Question Time today. Questions which would normally be addressed to Mr Holding should be directed to the Minister for Social Security, Mr Howe. Madam SPEAKER —I inform the House that we have present in the gallery this afternoon a delegation from the European Parliament led by Mrs Eva Gredal. On behalf of the House I extend a very warm welcome to the members of the delegation. Honourable members-Hear, hear! Mr PEACOCK —I refer the Treasurer to page 48 of Budget Statement No. 2 which states: . . . freeing of constraints in shipping and stevedoring areas would lower costs to users, thereby improving the competitiveness of export industries and reducing the insulation of other domestic industries. I ask the Treasurer whether he supports the basic conclusion of the Industries Assistance Commission (IAC) draft report on coastal shipping which states: Coastal shipping in Australia is inefficient and has jeopardised growth and employment prospects elsewhere in the economy. Mr KEATING —I do not think there is any doubt that that conclusion would be right. But the value of any of these reports concerns how one gets there. The mere fact that that can be said after 30 years of coalition Government means that that Government either did not understand the matter, or that it understood how inefficient the domestic coastal arrangements were and decided that it was too hard to do anything about it. This Government has taken substantial steps to address it. My colleague the Minister for Transport and Communications Support has succeeded in changing the manning structure on Australian vessels, both on and off the coast. The Government is now looking at a broader maritime strategy which includes this reference to the IAC report. I am sure that the honourable gentleman is alluding to the structure of the draft report which, in terms of the debate, is disappointing. Having said that, it is only a draft report. The IAC will now begin to produce a final, more comprehensive report and will follow the usual practice of taking public submissions. I hope that the final report will be a more constructive document to the extent that it recognises the substantial advances that have already taken place on the waterfront, both in terms of the waterfront itself and shipping-particularly relating to the terms, conditions and manning levels of Australian coastal shipping and Australian international shipping. I conclude by saying that I endorse the broad conclusion of the report. I do not think that any person interested in the Australian waterfront scene would not do so. Endorsing reports, writing such conclusions and getting there is what the game is all about. The fact that we have spent five years taking Australia this far in structural change is testimony to the fact that it has been such an inordinately large task, given the fact that once these structural arrangements are set in place-broadly, they have been undisturbed for 30 years-they take a lot of repairing. Mr SNOWDON —Is the Minister for Social Security aware of some criticisms of the Government's child support scheme in the media? Can he inform the House of his response to these criticisms? Mr HOWE —The media throughout the country has generally strongly supported our announcement of the child support scheme. This reflects in turn very strong community support for the scheme-support which has been gained because we have designed the scheme on the basis of principles of fairness and equity and because we have sensitively dealt with all the different interests involved. Regrettably, I am aware of some criticisms of the scheme in the Press. I am pleased to assure the honourable member and the House that each of the articles critical of the scheme has been factually incorrect. Very few journalists have criticised the scheme for things it just does not do. Every journalist who has understood the scheme has supported it. On 22 April the Adelaide Advertiser ran a story expressing concern that the scheme could push some parents into poverty. Its thrust was that the new rules for assessing maintenance in capital form could cause hardship. The story failed to acknowledge the significant changes in family law that have been made as part of the child support scheme. Discussions between my office and some judges and senior practitioners in Sydney and Melbourne make it clear that in the two weeks since these changes came in they are having a very real effect. When maintenance is provided by way of capital it is now an amount that will provide real security to custodial families. Custodial families affected by these changes will clearly be greatly assisted, not adversely affected. I am also aware of a most scurrilous article in the esteemed publication the Gold Coast Sun. In what it termed an exclusive the paper alleged that there had been a massive blunder by the Federal Government and that the Senate would stop maintenance payments for supporting parents for two months. The good reason why this story was an exclusive was that no reputable journal would carry it. Let us deal with the facts: there are a number of different categories of custodial parents. Custodial parents who separate and gain maintenance orders or agreements after 1 June will have delivered to them for the first time secure maintenance, regularly and on time. Pensioner parents who are currently happy with their arrangement because their maintenance is paid regularly and on time can continue that arrangement and will not be affected. Pensioner parents with orders or agreements who are not regularly paid will be able to get regular maintenance now. There are a range of State maintenance collection agencies, such as the collector of maintenance in magistrates courts, whose functions will be taken over by the Child Support Agency. None of these agents can currently ensure regular payment of maintenance for a non-custodial parent who does not voluntarily and diligently comply with their order or agreement. We will take over the functions of these agencies in a staged way over the next year or so. In that process one of the matters we will be sensitive to is to ensure that we do not cause unnecessary disruption to arrangements of people who are receiving regular timely payments through these agencies. I have referred to a number of Press articles. I conclude by saying that not even the journalists who got these stories wrong carried the deliberate untruth that the honourable member for Bradfield tried to convey to the Australian people last week. Madam SPEAKER —Order! The Minister will not-- Mr HOWE —I am referring to the Press, not to the honourable member, but I withdraw that remark. In a media statement of Wednesday last week he asserted that the child support scheme was built on reforms initiated by the coalition. I said no such thing and would not say any such thing because it would be untrue. I acknowledge the support of the Opposition for the child support scheme and thank the honourable member for Bradfield for his work on it. This House needs to be reminded that in the period in which the Opposition was in government and in which the number of sole parents and children in poverty was escalating, the coalition failed to address that issue. We certainly did not build on the only proposition that emerged from Senator Durack, which was that non-custodial parents should be sent to gaol. Mr MOORE —My question is addressed to the Treasurer. I refer him to the Industries Assistance Commission (IAC) report. Having just, in answer to a previous question, endorsed that report by implication and having said that it is hard to get there, I ask him how that squares with the comments made by the Minister for Home Affairs, Senator Robert Ray, who stated: At the moment, the Government shows no sign, and I endorse that, of doing away with protection of Australian ships. Is it a fact that there is no way the Government is going to do away with protection of Australian ships and is not going to try to respond to the IAC report? Mr KEATING —I did not endorse the report. What I said was that I endorse the view that there are inefficiencies in the coastal trade. To not endorse that view would be pretty naive to say the least. I said, and I repeat, that I think the report is disappointing for the fact that it does not recognise the successes and changes that have been made, or comprehend those that need to be made to make such a maritime strategy succeed. What Senator Ray has said is simply that in more words. As I have said, this is a draft report. That report will become a comprehensive and final report. I regard it all with some mirth that-- Mr Jull —Well, laugh! Mr KEATING —Let us say that I am having a little chuckle inside. I do not know whether it is a qualification of membership of the Liberal Party of Australia that one should have no shame, but somehow those opposite all manage to do it. They basically ran Australia for all the post-war years, bar three years from 1972 to 1975. Whatever structural deficiencies the place has, those opposite are responsible for. They know that shipping and transport was always given to the National Party of Australia. Mr Sinclair —Oh, it is all our fault. This was before 1970. Mr KEATING —We have one voluble, noisy, stentorian voice from the other side of the chamber now talking as a former Minister for Shipping and Transport and it was always the dead hand, the usual McEwen hand of protection. Whether those opposite talk about television, shipping and transport, or motor cars, it does not matter. They managed to make most efficient industries inefficient and now they have an IAC report; they have got something, and they are going to tell us. I say: Do your best! Mr BILNEY —I ask the Minister for Housing and Aged Care whether he has noted the positive reaction in South Australia to the recently announced changes to nursing home personal care arrangements? In view of the widespread concerns which are expressed regarding those changes before they were announced, can the Minister reassure this House and the many people in South Australia who are concerned with this important issue, that the impact of the changes will be beneficial to nursing home patients, to their relatives and to nursing home staff alike? Mr STAPLES —I thank the honourable member for Kingston for his question. Mr Tuckey —Madam Speaker, I raise a point of order. My understanding of this week's Notice Paper is that this matter is up for debate. Surely the Minister does not need to waste our time when he is going to get another 30 minutes on it. I raise a point of order under standing order 144. This matter is on the Notice Paper. Standing order 144 states: Questions cannot refer to- debates in the current session; or proceedings in committee not reported to the House. The Minister's Community Services and Health Legislation Amendment Bill is on the Notice Paper for this week. Madam SPEAKER —If they were in the very near vicinity of being called on, that would be correct. Mr STAPLES —In response to the specific question of the honourable member for Kingston, there has been a positive response to the announcements. If those opposite get upset about this situation, then perhaps they have good reason to be as they were one of the main instigators in creating concern. I am pleased to note that there has been a very positive response to the Government's announcements of the changes to nursing homes and to the Government's aged care policies in general. That has not only been the case in South Australia, but also in every other State and comes from the wide range of people interested, whether it be the industry, unions, consumers or many other people involved in aged care throughout Australia. Mr NEHL —My question is directed to the Minister for Employment and Education Services. In his address to the Young Labor conference in his capacity as Minister for Employment and Education Services, he said that there can be no place for privatisation in the Australian Labor Party as it is a concept `akin to the robber-baron mentality which puts profit before people'. Does the Minister stand by this statement? Mr DUNCAN —I thank the honourable member for his question. I made that speech in a Labor Party forum and the Prime Minister has called for a debate on this matter. I do not intend to pursue the matter in this public forum. The appropriate place to have such a debate is within the Party. I am amused at the way the Opposition is handling this matter. We have a backbencher asking such a question. It seems to be that the Opposition is dealing with the matter with a fair bit of frivolity anyway. Mr LINDSAY —Will the Minister for Defence Science and Personnel inform the House of what initiatives this Government has introduced to encourage pilots to stay in the Australian Defence Force? Mrs KELLY —I thank the honourable member for Herbert for his question and his continuing interest in the defence forces, particularly those in his own electorate, including the Royal Australian Air Force (RAAF) base in Townsville. The Government has decided to introduce a retention bonus for pilots in the Australian Defence Force. The bonus will be set at $70,000 and in return pilots will commit themselves for a further six years of service. But this $70,000 is only part of a package to encourage pilots to stay in the Royal Australian Air Force instead of moving to commercial airlines. The RAAF has initiated a whole range of measures designed to improve retention in the long term. We are increasing recruiting and training; we are improving manpower utilisation and management and filling more staff appointments with non-pilots; we are examining the creation of a specialist air crew scheme; we have increased the return of service obligation from six years to eight years and the retirement age for selected pilots could be raised to 55 years. Pilots are also beneficiaries of the various ways that we have increased conditions for defence service families. All these measures take time to have an effect. Meanwhile, we do expect that Qantas Airways Ltd and other commercial airlines will continue to recruit; therefore the Government has decided to introduce the bonus. The bonus will be targeted very specifically at the people we need to help with the training-flight lieutenants in particular. Pilots aged under 37 years who have completed six years of service as pilots and who are in receipt of the flying allowance are eligible. This means that most pilots who are eligible are in the ranks of flight lieutenant and squadron leader and their equivalents, plus a few wing commanders. In total, 230 pilots are eligible this year to accept the bonus. The RAAF and the Government are determined to train our way out of our pilot shortage. In the meantime we are determined to keep our experience levels high so that training can continue without affecting operational flying. This bonus is just another way of showing this Government's commitment to the defence forces of this country. Mr McGAURAN —My question is directed to the Minister for Employment and Education Services. I remind the Minister that the Government invested an additional $115m in Australian Airlines in 1982-83 and did not receive a dividend from Australian Airlines for the five years 1981-82 to 1986-87. In view of this record, can the Minister explain to the House why, as Minister for Employment and Education Services, he listed Australian Airlines as one of the `Government business enterprises . . . which have contributed significantly to Government revenue' and should therefore not be privatised? Mr Gear —Madam Speaker, I raise a point of order. This question has nothing to do with the Minister's responsibility. It should be ruled out of order. Madam SPEAKER —The question is in order. I call the Minister for Employment and Education Services. Mr DUNCAN —I must say that the lot opposite really amaze me. They have the cheek to come into this Parliament and ask questions of that sort, given the fact that they themselves have absolutely no policies at all on anything. It indicates a fair amount of the sort of gall the Treasurer was talking about a few moments ago. I do not know whether the honourable member is hard of hearing, but I made comments answering an earlier question today that covered this situation. I rest on that answer. Mr ALLAN MORRIS —I ask the Minister for Defence whether he can advise the House of the current situation of the Anzac ship project. Is the project proceeding to schedule? What is the timing of decisions leading to the signing of contracts for construction? Mr BEAZLEY —The honourable gentleman has been very diligent on this matter, having been in contact with my office over the weeks, and I thank him for his attention to it and his concerns for his electorate. On Friday documentation development contracts were signed with Australian Marine Engineering Corporation Consolidated (AMECC) and Australian Warships Systems (AWS). These contracts involve design development and Australianisation-I should include New Zealand in that-and are each worth about $8m. The project is on schedule, despite a timetable that is demanding on the Department of Defence, the Royal Australian Navy and both consortia. Draft tender documents have been with the consortia since 8 March. Final tender documents will be issued in the next few weeks. Deliver- ables from the documentation development contracts are due on 20 and 22 November this year. The response to the tender documents is due on 29 December this year. Six to eight months are to be allowed for the evaluation of contract negotiations, starting at the end of November. Contract signing will occur in mid-1989. This is yet another indication that, in all the areas of defence policy this Government pursues, we are on target with regard to Australian industry and relevant to our defences. Mr N.A. Brown —My question is directed to the Minister representing the Minister for the Arts, Sport, the Environment, Tourism and Territories. Has the Government imposed a new arrangement for the release of duty free goods taken out of Australia by tourists through Brisbane Airport, to come into operation on 1 May 1988, the day after World Expo 88 is officially opened? As part of this arrangement, has the Government, without calling for tenders, given to one lucky company the exclusive right to run this service? Has the Government also given this one company the right to impose a tax of 1 3/4 per cent on the value of the duty free goods before they will be allowed to be taken out of the country? Is it not a fact that this Expo tax, introduced without legislation, will put a new burden on exporters and a financial charge on tourists who visit Expo and on Australian tourists who want to buy duty free goods? How does the Government justify this new tax on tourism? Mr PUNCH —I am not aware of the matter the honourable member has raised. I will undertake to get an answer from Senator Richardson and have his office supply the honourable member with an answer. Mr SAWFORD —My question is directed to the Minister for Science, Customs and Small Business and focuses upon new materials and the electrical power industry. What major developments in new materials have the potential significantly to change the technology, and therefore the economics, of the electrical generating and distribution industry worldwide? Mr BARRY JONES —The three developments are the discovery of low magnetic loss metallic glasses, the discovery of high energy storage permanent magnets and the discovery, which I have mentioned in the House a couple of times before, of high temperature superconductors. Very important work is being done by the Commonwealth Scientific and Industrial Research Organisation (CSIRO) and a number of the universities and we believe that we may be able to make a very significant contribution to the world power industry. Metallic glass alloys of iron, boron and silicon discovered by the Allied Corporation in the United States of America have the potential for reducing core losses in transformers by 75 per cent. To make metallic glass strips, molten alloy is quench cast. That means that the temperature is reduced from 500 degrees to normal room temperature at a rate of one million degrees per second. That is an extraordinarily rapid drop. High energy storage permanent magnets, particularly iron-neodymium-boron alloys, have enormous high energy densities. They are very strong permanent magnets which can be used very effectively in a wide range of motors and generators. They can provide levitation, for example, in transport, which could certainly revolutionise the Sydney monorail, to mention only one use. The ceramic materials I have mentioned before-the yttrium bismuth barium oxides-which are superconducting at reasonably accessible temperatures, have been discovered in the last 18 months. If temperatures at which superconducting operates can be raised towards, say, room temperature, there will be dramatic changes. The use of liquid nitrogen rather than liquid helium is very important. Liquid nitrogen is a by-product of the steel industry. It uses liquid oxygen in making steel, so there is a natural by-product and the price of liquid nitrogen is only 22c per gallon, whereas the cost of liquid helium is $11-a 50:1 differential. So this is a significant development which is very good for the steel manufacturing areas. This is the most important prospect coming out of the work that CSIRO is doing in conjunction with the State Electricity Commission of Victoria. Superconducting materials can be used as electric storage devices. For example, a device about the size of House of Representatives Committee Room 1 would be able to store enough electricity to provide the peak hour requirements of Sydney or Melbourne. Just think of the implications of that. It means that future requirements for dams or coal fired generators will be much reduced if all we need is to provide the base load all the time and store that up, then producing out of the accumulator the difference between the base load and the peak load. That has very important implications for the whole of the electricity generation industry. Taken together, these developments could raise our electrical generation and distribution efficiencies by 25 per cent and would save hundreds of millions of dollars. If the technology is exportable, it could create billions of dollars of exports for this country. Mr REITH —I refer the Attorney-General to Senator Tate's comments in the Senate on 20 April on the 2 1/2-month-old investigation into the Harris-Daishowa-Australian Labor Party affair, when he explained the delay in the Australian Federal Police completing its inquiries as being due to `difficulties in arranging mutually convenient times to interview two witnesses'. I ask: Have these witnesses now been interviewed? When will the police report be provided to the Director of Public Prosecutions? Mr LIONEL BOWEN —The last information I had on this matter was from the Director of Public Prosecutions, who said that the initial inquiries had been completed but, because of some other evidence which had come to his notice, he was asking for further inquiries. That would have been about three weeks ago. I have not heard from the Director since. I will have further inquiries made today. Mr HOLLIS —I refer the Minister for Administrative Services to statements made last week by the honourable member for Barker that more than $50m a year is being spent by the Federal Government on rent for unoccupied office space. What are the facts about Government expenditure on so-called `dead rent'? Mr WEST —I do believe that the shadow Minister for public administration, the honourable member for Barker, put out a Press release last week claiming that the Government outlaid something like $50m per year on dead rent. When I saw that Press release I was, to say the least, extremely puzzled as to how he arrived at that figure. After reading the Press release I further noticed that an attachment listed 22 expenditure items for fit-out over the past three or four years in New South Wales. Thus I arrived at the answer as to how he calculated the figure of $50m. It seems that he added up these 22 items of expenditure on fit-out over the last three or four years and extrapolated them by a factor of 10. Why 10, I do not know. Nevertheless, he multiplied the $5m for the fit-out expenditure of 22 items over the last three or four years by 10 and arrived at $50m and said that this was the figure for dead rent for 1987-88. It seems to me that the honourable member for Barker is going down the same track as his leader, the honourable member for Bennelong. He is the person who made $7 billion to $8 billion worth of unfunded pledges and promises at the last Federal election. He double counted the so-called savings he was going to make on payments to the States to the extent of $2 billion or $3 billion. So all that one can say is that the honourable member for Barker is about as good at public finance as is the honourable member for Bennelong. I can now inform the House of the exact figures. If the Leader of the Opposition wants to put up a shadow Minister in the field of public administration he should at least put someone in the position who is capable of simple arithmetic. If they put a figure into the public arena of dead rent over one year they should at least have a method of arriving at a figure that stands up to public examination. The total rent paid this financial year to 16 March was in the order of $267m and rent paid for so-called dead rent was $3.9m for leases that needed to be committed, and rent paid before fitout commenced. There was another $2.3m in the same period for other factors. The total is $6.2m and not $50m. So the true figure for so-called dead rent was just over $6m and not $50m. I might point out, Madam Speaker-- Mr Donald Cameron —Madam Speaker, I raise a point of order. The Standing Orders require answers to be prompt. The Minister is already on page 5-- Madam SPEAKER —Order! The honourable member will resume his seat. Mr WEST —Actually the factors that go to make up the figures for so-called dead rent fall into several categories. The first is that leases often have to be committed before or during the construction of a building to obtain the accommodation in the first place. Secondly, as I have said, the private sector lessors usually require rent to be paid before fit-out commences. The Opposition might try to say that dead rent can be so categorised but unfortunately the private sector lessors are not altruists who would want to lease to anyone, including the Government, during a fit-out before rent is paid. When the shadow Minister puts forward the figure of $50m paid out for dead rent in one year he is giving a wildly inaccurate figure. The figure is arrived at by the use of shonky arithmetic. He has lost all credibility. If he wishes to criticise, let him do so, but before he opens his mouth he should make sure that his figures are correct. Mr MOORE —My question is addressed to the Attorney-General. Is it a fact that seminars arranged in Sydney and Melbourne which would for the very first time allow public debate on the Government's plan to place company law in the hands of the Attorney-General's Department in Canberra have been postponed? Why were the seminars postponed? Does this mean that there will now be no public discussion on the Government's proposals before the legislation is introduced in the House? Is it a fact that the 34 members of the Attorney-General's consultative group were required to take a vow of silence on their discussions? Mr LIONEL BOWEN —We never require any vows of silence in the Attorney-General's Department. There is an advisory committee, a small group of business people who are looking at improvements to what is called corporate law, with a wider consultative group of some 34 people who come from all over Australia. There is no problem about the matter. Even some of those who are part of that group can have various opinions. They are not sworn to silence. As I think honourable members might note from some of the Press reports, there are various views as to what the law ought to be. The issue that the honourable gentleman is obviously worried about-this is the first question he has asked me in the whole of his career-is that we might be able to-- Mr Moore —That is not true. Mr LIONEL BOWEN —In respect of this matter it is. I might rephrase it; I appreciate the position. Perhaps it is the second question he has asked in the whole of his career. Would the honourable gentleman settle for two? I cannot remember what the first question was about but we will check it up later. I think at this stage the honourable gentleman would agree, as he has already announced he would oppose any improvements to corporate law from a Federal point of view, that there is not much point in inviting his discussions. He is welcome to have any input he likes into improvements in the law. The people dealing with it are talking about-- Mr Moore —No, I have asked you but you have turned me down. Mr LIONEL BOWEN —The honourable member can make a speech some other time. Madam SPEAKER —Order! The honourable member for Ryan will cease interjecting. Mr LIONEL BOWEN —We are dealing with improvements in the law which I think would be of the greatest benefit to the corporate sector in Australia. Mr Moore —Yes, and I have asked you-- Madam SPEAKER —Order! The honourable member for Ryan will heed the Chair. Mr LIONEL BOWEN —It is important and it is about time the Opposition faced up to the fact that the present scheme is cumbersome and is not working. Even the Leader of the Opposition had enough nous to know that that was the position, and he said so in the absence of the honourable member for Ryan on one occasion. We are very anxious to streamline Australian corporate law. The only way to do it is by having this Parliament approve of it. It cannot be done until such time as the business community in general feels it is satisfactory to them. It is certainly agreed throughout Australia that it is about time we had some law which was under scrutiny of a parliament and answerable to a parliament. At present we have a hybrid scheme, the only creation of which could come from the National Companies and Securities Commission, not answerable to any parliament, not answerable to any Minister. We are stuck with this arrangement made in 1978 and no amendment can be moved to it in this Parliament. It is a ridiculous, sterile arrangement which we must get rid of. Accordingly, I propose to introduce what I think will be effective company law for the scrutiny not only of the Parliament but also of the business community. I would like to do that before this session ends. It will lay on the table until the Budget session so that there can be discussions about the law, but I can assure the honourable gentleman that it will be miles ahead of the present law. I am hopeful that we will get cooperation from State governments from the point of view of their being able to enter into government managerial arrangements whereby they could administer Federal law in accordance with what they regard as their privilege, namely, the collection of revenue from it. As I told the honourable gentleman the other evening in a debate on another matter, all we would want from it would be 12 1/2 per cent, one-eighth. With one-eighth of the revenue the States collect we could have a very efficient, streamlined business law in Australia, administered by a business group called the ASC, with a business advisory council whose members come from all over Australia. I think it would work very well. I welcome the shadow Minister's interest in the matter and I invite him to continue asking questions on it. Mr CROSS —Has the Minister for Defence seen claims by Queensland Ministers to the effect that there is discrimination among States in the award of defence contracts to the detriment of Queensland? Can the Minister outline the system whereby defence contracts are awarded? Mr BEAZLEY —I thank the honourable gentleman for his question. I have seen those statements. I have also seen statements by Queensland Ministers to the effect that, although there was discrimination against Queensland, after they had seen me everything was fixed up and now Queensland will be able to compete on an equal basis. All these statements are nonsense. There is no discrimination against Queensland. There has been a poor performance by Queensland Ministers. Virtually every other State has managed to take note of the fact that Defence spends about $3 billion a year inside Australian industry and has made some efforts to get some of that business for their own business houses. In addition, a number of States have taken initiatives to ensure that the quality assurance performance of their local industries is up to scratch as far as Defence is concerned. Over the last few years Western Australia, South Australia, New South Wales and Victoria have made enormous strides in getting together a coherent approach to the Department of Defence and, more importantly, a coherent approach to their own industries to ensure that they take full advantage of contract opportunities. One government which has lacked this approach and which has shown the least amount of interest has been the Queensland Government. One would think that the Queensland Government would have plenty of time on its hands, given the number of sitting days of its Parliament, to do something useful for its industry. But it does not. Instead, it moans, mewls and pules, saying that it is discriminated against, which is a traditional reaction of the totally inactive. Tendering for defence contracts is on the basis of price, quality and performance. Those are the bases on which decisions are taken in purchasing inside Australian industry. There is no discrimination among States. The number of contracts is so vast that it would be virtually impossible to devise an active policy of discrimination against States, and there is none against Queensland. In so far as there is any legitimate basis of concern, I can set the minds of honourable members from Queensland at rest. They ought to look at the overall performance of the Queensland Government, and they would know where that question was coming from. Mr HOWARD —I ask the Attorney-General: Which States have indicated their support for the legislation he proposes to introduce shortly? Mr LIONEL BOWEN —No States have indicated their support, which is pretty well known. New South Wales indicated its support, but I assume that the incoming Government will withdraw it. As the honourable gentleman would know, for some time I have been suggesting that there ought to be some parliamentary law, which could be the subject of debate, scrutiny and amendment, in this area. The only way to do it would be in this Parliament. Mr Howard —What about the split system? Mr LIONEL BOWEN —I thank the honourable member for that interjection. I suggested the split system on the basis that the States could keep under their control what are called the exempt proprietary companies and small business. They refused to accept that. I offered it to them in accordance with an undertaking I gave to the honourable gentleman here. I welcome his interest in the matter because his concern is more national in outlook than others show here. The States rejected my offer on the basis that they felt they could not administer a split scheme. Let me come to the present position. Following my offer, at a meeting of the ministerial council, the majority of the States put to me the following proposition: I could introduce any law I liked, provided I had the support of at least two States. I did not regard that as being an effective way for a Federal Minister to exercise responsibility. In other words, I would be in the ridiculous situation of being able to bring forward what I regarded as a Federal law only if I had the support of two States. I would have an inhibition placed on me that no Federal Minister in history has had placed on him. I made the further point that if that were the position, if that was where we are at present, I would give the States an input into what law I would be introducing into the Parliament. In other words, I would show them, as a ministerial council, or better still, as a meeting of Attorneys-General, what the proposals were and, if they had any objection to those proposals, I would report them to this Parliament. Further, because they are concerned about the employment prospects for their corporate affairs commissions I said that I would welcome entering into government arrangements whereby the existing State commissions could remain under State control and administer Federal law. All I would want, as I indicated in the previous answer, would be one-eighth of the revenue they collected. There is a profit of about $72m in the revenue at present which the States are very anxious to keep. It is important that we streamline and get efficient administration at a Federal level. It is also recognised that we are not trying to move the whole lot to Canberra. Canberra is seen as an anathema on the basis that the law will be centralised. As has already been discussed, the proposed law will be on the basis that there will be a statutory business advisory committee. In other words, representatives of the business community from all over Australia will, on a statutory basis, be able to advise the proposed Australian Stock Exchange. Further, I have suggested to the State Ministers that, to ensure that the State corporate affairs commissions have some input, we could have two part time members of the State corporate affairs commissions associated with the Australian Stock Exchange. A great weakness in the present scheme is that there is no dialogue, communication or direction from the National Companies and Securities Commission (NCSC) down to the State corporate affairs commissions. There are 1,500 people working in the State corporate affairs commissions who have no real relationship with the NCSC, trying to struggle on without any real resources and devoid of money. This places a burden on the business community from the point of view of delay. We need a bipartisan attitude to this situation. I can understand States wanting to hang on to the idea that this is a great scheme but, quite frankly, there would be nothing else like it in the democratic world: to think that law could be generated outside parliament and not be able to be rejected or amended by parliament. The Senate Select Committee on Securities and Exchange recommended Federal legislation in this area. I understand that all parties, other than the Australian Democrats, were represented on that Committee which took evidence from the business community. Members of the Committee were unanimous in their recommendation. It was an intelligent recommendation. Some of my Labor Party colleagues still apply a State limitation-everything must operate within State boundaries. There is only one market in Australia. There is only one central business organisation-the stock exchanges, which have now formed themselves into the Australian Stock Exchange. That has been made very clear even in terms of the Rae Committee report. If we can get the law right-and I think we can-I am sure that we will be able to get the business community to agree that the proposal would be of the utmost benefit to it. Mr HOWARD(Bennelong-Leader of the Opposition) —Madam Speaker, could I have your indulgence to say something about a comment I made in the House yesterday in making a personal explanation? Madam SPEAKER —Indulgence is granted. Mr HOWARD —Thank you. In making a personal explanation in the House yesterday, I made a number of critical comments about an article that had appeared in the Australian written by the foreign affairs correspondent of that newspaper. I have checked the transcript of my answer and the substance of the article and I find that in three areas I inaccurately reflected upon the original article. Naturally, having done the journalist an injustice in those three areas, I unqualifiedly withdraw the criticism I made in relation to those three areas but not in relation to any others. 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 National Airlines Commission (Australian Airlines) and Ansett Transport Industries Ltd-joint report on air fare consultations held during 1987-sub-clause 7 (11) of the schedule to the Airlines Agreement Act 1981. Australian National Airlines Commission (Australian Airlines) and Subsidiaries-financial information relating to the total operation of air services for 1986-87-including the Auditor-General's report-clause 13 of the schedule to the Airlines Agreement Act 1981. Ansett Transport Industries Ltd-financial information relating to the total operation of passenger air services for 1986-87-including the Auditor's report-clause 13 of the schedule to the Airlines Agreement Act 1981. Advisory Group on Australian Airlines-March 1988-Report. Mr PORTER(Barker) —Madam Speaker, I wish to make a personal explanation. Madam SPEAKER —Does the honourable member claim to have been misrepresented? Mr PORTER —Yes. Madam SPEAKER —Please proceed. Mr PORTER —The Minister for Administrative Services (Mr West) in his response to a question today claimed that the information I had released last week in relation to dead rent, which was provided to me by his Department, was an improper basis on which to calculate annual dead rent costs. He claimed that I calculated the annual dead rent cost by multiplying the dead rent figure, which I released last week and which concerned dead rent involved in the provision of Commonwealth office accommodation for just one department, in one city, by 10 to get an annual figure. That is quite incorrect. The correlation between known dead rent and total building projects undertaken by the Commonwealth was done on a history-related basis on known fitouts to be undertaken by the Department. The Minister also claimed that the dead rent for the nine months of this year was just under $5m. Madam SPEAKER —Order! The honourable member has gone past a personnel explanation. He is moving into debating the area. Mr CONNOLLY(Bradfield) —Madam Speaker, I wish to make a personal explanation. Madam SPEAKER —Does the honourable member claim to have been misrepresented? Mr CONNOLLY —I do. Madam SPEAKER —Please proceed. Mr CONNOLLY —In this morning's Sydney Daily Telegraph an article appears under the heading `Sydney's west ``like Soweto'' '. The article says, in part: Families in Sydney's far west are living in conditions similar to South Africa's Soweto, Federal Opposition social security spokesman David Connolly told Parliament yesterday. That is a total travesty of what in fact was said. The details are in Hansard. I was referring specifically to one caravan park in the Mount Druitt area. I understand its name is the Prospect Caravan Park. I have discussed the matter with the Mayor of Blacktown, Alderman Russel Dickens, who is also concerned about the accommodation at that establishment. I understand the council is taking some legal action in that respect. I draw this to the attention of the House because it may cause concern to people in the western suburbs of Sydney to suggest that they are living in a Soweto-type environment. My comments were never meant to be so interpreted, and regrettably yet again we have an example of newspapers using headlines to go way over the top and totally misrepresent what in fact was said. Mr HAYDEN(Oxley-Minister for Foreign Affairs and Trade) —by leave-For the past five years, I have observed a great many examples of the dilemma which faces our consular officers overseas. On the one hand, they efficiently and faithfully carry out the Government's firm policy that Australians overseas should get the fullest possible protection and assistance in times of difficulty. On the other hand, they are constrained in this task by legal, financial and other problems. The Australian Government has the most active sympathy for Australian citizens in difficulty overseas but there are limits to what it can do in such circumstances. My purpose in making this statement is that honourable members and the community as a whole should appreciate both the extent and the limitations of the assistance available to Australians travelling overseas. Cases in which Australians get into difficulty with authorities overseas are matters of distress and sometimes hardship back home. They are the subject of frequent representations to me by honourable members. They often create misunderstanding in the community at large. They are sometimes the cause of perhaps understandable but unhelpful and counterproductive commentary. A number of such cases have occurred recently. I would like to clarify the responsibility which the Australian Government has-and the limits to that responsibility-to Australians entangled in legal and other problems while overseas. Let me emphasise at the outset that the Government does not view the provision of consular services to Australians as optional. If it is not a formal legal obligation, it certainly is a moral one. The Government is glad to accept as a primary responsibility the protection of Australians overseas to the fullest possible extent. The consular protection governments can give to their citizens is limited but well recognised in international law. The Vienna Convention on Consular Relations defines the functions of consular officials. Australia subscribes to this convention, having signed it in 1964 and ratified it in 1973. But the Australian Government is also prepared to do more for the protection of its citizens overseas-more, in fact, than most other governments, despite the scarcity of resources and despite the high and increasing numbers of Australians travelling overseas. The Department of Foreign Affairs and Trade has increased its activity in forewarning travellers of possible pitfalls ahead of them. Its informative Hints for Australian Travellers is issued with each new passport. It has produced pamphlets and other material on the dangers of involvement overseas with drugs. It stresses at every opportunity the need for travel insurance. It issues advice about travel in places where personal safety or health is threatened. The Department contacts every travel agent and other similarly interested organisation in Australia to inform them of concerns about conditions overseas which come to light through reports by our missions. A recent instance of this was its warning of an upsurge in cases in one particular country of travellers accepting drugged drinks from so-called friendly strangers and waking up minus money, passport and plane tickets. The Department also provides a range of everyday services to Australians overseas. Consular officers advise about international banking arrangements, for example; help when money or other belongings are stolen or lost; and help next of kin in the event that an Australian dies overseas. They help travellers who become ill; help to find relatives and friends in emergencies; visit Australians in hospital or prison; and sometimes facilitate return home by Australians who are distressed in some way. Australian people and organisations overseas often need documentation to be authenticated, witnessed or certified for use back home. Consular officers can take evidence under oath. In some countries, they can perform marriages. This by no means exhausts the list of consular services provided to Australians overseas. It is enough to repeat that no other government makes greater efforts. I re-emphasise also that these services are provided at a time of stringent economic conditions at home and significantly increased travel by Australians overseas. It is all the more necessary therefore that Australians fully understand that there are limits to these services and what these limits are. The necessity is underscored by evident misunderstandings about this in certain sections of the media, from which many Australians derive their information, and, I regret to say, even among some honourable members. By this I mean, first, there is an unreal expectation of what the Australian Government can and should do for Australians who choose to travel overseas in hazardous circumstances and, second, a misconception about the relationship between Australians and the laws of the country in which they are living or touring. As the numbers of travelling Australians has increased, so have their expectations of what the Australian Government should do for them when in difficulty. The Government has active sympathy for Australians in difficulty. But it cannot always meet these expectations, either because they require action which is against international law or practice or because they are simply beyond our resources. People who do not understand this or who have been misled about it can sometimes be quite bitter when they do not get the service they want. Honourable members will recall the wide public interest in the tragic case of the two young and reportedly underqualified pilots who went missing in the Atlantic last September. These young men were, of their own free will, engaged in a commercial operation in an area very far from our own shores. The combined efforts of defence forces provided by Nigeria, Gabon and the United Kingdom failed to find the two young men. The cost of this activity to the Australian Government-and by that I mean quite obviously to the Australian taxpayer-was much more than $1m. Another recent case which attracted publicity was that of the young nurse who was believed to have gone missing in suspicious circumstances in West Africa. A consular officer tracked down her movements and confirmed that she was in fact safe and well. The problem had arisen because she had failed to telephone her family in the time period she had arranged with them. The search for her involved 20 different departmental officers here and in four overseas posts, the co-operative efforts of officials of friendly governments, and an investigatory trip to Togo by a staff member of our mission in Lagos. Australia has a comprehensive search and rescue system which is available free to anybody in distress in its territory, whether this person is a citizen or not. Search and rescue systems elsewhere may be as comprehensive but charges-I am advised by my Department-can be levied when loss or injury result from activity known to be hazardous. Australia cannot demand of those other countries that their search and rescue services should be free to Australians. Australians who intend to take part in hazardous activity in remote places, their families back home and the media have to understand that there is a heavy final cost to the taxpayer when this activity goes wrong. A sympathetic Australian Government will do what it can to persuade other governments to provide the level of service their experts see as appropriate to the circumstances; but we cannot give an open-ended commitment, at Australian taxpayers' expense, to search and rescue in remote places in terms either of scope or funding. Taxpayers are entitled to expect travelling Australians to act prudently; to consider the possible consequences of the hazards they are contemplating; to take the proper equipment with them; to take out adequate insurance; and to be properly qualified to undertake particular ventures. The second area of misunderstanding-concerning Australian travellers and foreign laws-is complicated by an unreal, almost chauvinist, view in some quarters of the relationship between our society and others. The law of any nation is developed and conditioned by many experiences over many years. There are nations whose laws stem from a history of hostility by neighbours or of colonialism, for instance; from experience of drug abuse; from strict adherence to religious values and standards. We may not like or approve of these laws. This does not, however, give us the right to flout or ignore them as being in some way less substantial or consequential than ours. Like it or not, Australians must obey the laws of the countries they are visiting. If Australians do not, there is a limit to what their Government can do to alleviate the consequences. Failure to understand this has led to wide but ill-founded public comment on several occasions in the recent past. I offer honourable members some examples because they show how many kinds of legal problems there are for unwary or foolish Australians living or travelling overseas. The case of Kevin Barlow and Brian Chambers, who were executed by the Malaysian authorities in 1986 illustrates the drastic consequences which await Australians who become involved in foreign countries with drugs, even so-called `soft' drugs. The case of Ian Grey in Mozambique shows the dangers of challenging the security laws-for whatever misguided romantic or religious purpose-in a society in which security is the paramount issue. The case of Robert Wenham in Saudi Arabia illustrates that problems with the laws of another country may not be confined to matters of crime; that they be the most complex and arcane matters of civil dispute. The case of Mr Pantelic in Yugoslavia illustrates two points: the complications for Australians in the concept of dual nationality and the fact that conduct which may be allowed in Australia may be illegal elsewhere. These cases, different in so many respects, had one thing in common. This was the perception which informed so much of the considerable publicity generated by them. By this I mean the notion that the Australian Government should be able to pluck Australians out of their predicament; that it should `do something' to make other governments agree that Australians should be treated differently from the citizens of those other countries; that Australians overseas should somehow carry with them the legal rights and obligations obtaining back home; and that the Australian Government can and should impose Australian laws and practices on other countries' legal and penal systems. One can imagine the uproar here if another government insisted that its citizens should have the benefit of its legal system in Australian courts or that its citizens should have special treatment in Australian prisons. The chauvinism which underlies such sentiments in Australia is inexcusable in whoever displays it, whether public commentator, legal grandee or even member of Parliament. They cause grave embarrassment to the Australian interest overseas. They can also imperil the very cause they seek to support. The intrusion of such sentiments in the cases of Mr Grey and Mr Pantelic, for example, put their situation in grave danger during certain periods of the legal processes against them. This is a most important point and it needs the most careful consideration. It is easy-and in some cases obviously gratifying-to thump the tub about cases of Australians under arrest in foreign countries. But experience shows that there is often no surer way of encouraging the governments of those countries to dig in their toes; that fulmination and muscle flexing can militate against efforts for the release of Australians under arrest overseas. In making these points, I would like it clearly understood that the Government will properly and fully discharge its consular responsibilities to Australians in difficulties overseas. I want also to put precisely to the House the consular services available to Australians when they are arrested. Consular officers will ensure, as far as possible, that an arrested person receives the benefits of the same laws, administration and protection of rights and redress of injury as citizens of the country where the arrest took place. They will ensure access to legal representation and to regular consular assistance, including visits. To the extent that it is possible, they will see that an arrested person gets the same facilities-including accommodation, diet and medical or dental treatment-as citizens of the country where the arrest took place. They will provide whatever other assistance and advice can reasonably be given. Now let me make clear what consular officers cannot do in such circumstances. They cannot intervene in civil cases involving Australians. They cannot provide legal advice. They cannot achieve the release of an arrested person. There may be certain circumstances in which the Government may address the question of release from arrest, but it is not a consular function. The Pantelic case, as I have said, illustrates the complication in the concept of dual nationality. There have also been instances over the years of problems concerning the obligation of military service on Australians deemed to be dual nationals. The Australian Government may have considerable difficulties in helping protect the interests of Australians caught up in the problem. Consular officers try to provide whatever help is appropriate, but the level and nature of help will be dictated by the attitude of the country concerned. To help deal with the problem, my Department is negotiating with a series of consular agreements, of treaty status, with East European countries. The first, signed recently with Hungary, provides that travellers will be regarded as citizens of the country on whose passport they elect to travel. Thus, dual Australian-Hungarian nationals who travel back to Hungary on Australian passports will be regarded by the Hungarian authorities as Australians. They will be entitled to our consular protection and their right of prompt departure from Hungary is guaranteed. Negotiations for similar agreements are well advanced with Poland and the Soviet Union. Discussions are under way with Romania, Czechoslovakia and Yugoslavia. The job that consular officers do is complex and stressful. An additional disadvantage is that they seem to be visible only in times of trouble. I would like to state clearly that the Government is deeply appreciative of their work. Mr Bilney —A lot of them are unsung heroes. Mr HAYDEN —Is the honourable member speaking from personal experience? Mr Bilney —I am. Mr HAYDEN —I trust that this statement has helped honourable members and Australians generally also to appreciate their work and the legal, financial and other constraints on their services. The Government is in the process of reviewing the nature and scope of consular services to Australians overseas. It is my intention to ask the Joint Standing Committee on Foreign Affairs, Defence and Trade to assist by conducting an inquiry into the matter and making this review as comprehensive, effective and broadly supported as possible. The Chairman of the Joint Committee, the honourable member for Kingston (Mr Bilney), and I have had discussions on this matter and his inclination is to accept such a reference because of its vast and important national interest. I commend the statement to the House. Mr SPENDER(North Sydney) —by leave-The statement that the Minister for Foreign Affairs and Trade (Mr Hayden) made to the House is, for the most part, a very useful document. The Vienna Convention on Diplomatic Relations which defines, among other things, the function of consular officials is a lengthy and detailed convention running to some 26 pages. What the Foreign Minister has said about the functions of consular officials is a useful reference point for those who want to understand in plain language broadly what consular officials do. The Foreign Minister concluded his remarks by referring to his intention to ask the Joint Standing Committee on Foreign Affairs, Defence and Trade to assist in conducting an inquiry into the nature and scope of consular services for Australians overseas. That is a very good idea, and we certainly support it. I disagree with one or two comments that the Foreign Minister made, and I will come to those in due course. The Foreign Minister said that the Australian Government intends to provide the fullest possible protection for Australians overseas. Of course, we endorse that. He pointed out that the Australian Government seeks to do more than other governments do, and we also endorse that. That would be a common objective of any Australian government. Of course, there is always the problem of resources. The effectiveness of the assistance given by consular officials overseas depends greatly upon the resources that we apply overseas. I am sure that the Foreign Minister would agree with that. I do not believe he was hinting in his statement that the Government intends to erode in any way the existing overseas resource base. The Minister referred to the complex nature of the functions that must be exercised overseas to protect the rights of Australians, especially when Australians overseas become entangled in legal systems. The Pantelic case illustrates that point, just as it illustrates the problem of dual nationality. I know a fair bit about that case because I went to Yugoslavia to help Mr Pantelic. The House will recall that Mr Pantelic came to Australia when he was young, became an Australian citizen, was a permanent resident in this country, was married to an Australian-born woman of Serbian extraction and went back to Yugoslavia for the purposes of taking holy orders or something akin to that in the Yugoslav Orthodox Church. Whilst he was there he was imprisoned and was charged by the Yugoslav authorities and sentenced. I will return to that point later. The point of the exercise is that Mr Pantelic's liability to the jurisdiction of the Yugoslav courts depended on the fact that, whilst he had become a permanent resident in Australia and had taken out Australian citizenship, Yugoslavia did not recognise that action. I understand from what I learnt in Yugoslavia that it is extremely difficult for a Yugoslavia-born citizen to lose his citizenship even if he takes up citizenship in another country and notwithstanding the time that that person might spend in another country. I am glad to note that the Government has been able to work out a convention with Hungary regarding dual nationality; I believe the Government should be commended for that as well as for the negotiations it has entered into with other Eastern bloc countries. The Foreign Minister also referred to what he called misapprehensions in the Australian community, including amongst other members of Parliament, to the effect that the Australian Government was able to pluck Australians out of legal predicaments in other countries and that, effectively, the Government was required to do something to make other governments agree that Australians should be treated differently from the citizens of those countries, as it were to be treated as Roman citizens who, as they travelled from country to country, were able to say according to Roman law, `I am a Roman citizen. Try me under Roman law'. I do not believe that any honourable member has said that; I am certain that that sentiment has not been expressed by a spokesman on this side. People most certainly should not be under that kind of misapprehension. Of course, as the Foreign Minister points out, there are different legal systems. He said that Australians should not be entitled to special treatment, but the obvious questions arise, `What if the legal system is effectively not by our standards a legal system? What if there are no enforceable rights? What if it is the practice of a government to torture or imprison people for lengthy periods without trial or to conduct extrajudicial executions, as has occurred in various countries?'. That is the point of it. We all know that the legal systems of very few countries in this world give the citizens and others enforceable legal rights. What happens in those situations? Do we say, `True it is that this Australian is in difficulty, true it is that he has been treated like anyone else, true it is that he is being held without charge and true it is that he might have been mistreated or tortured but, because he is being treated the same as the citizens of the country in which he finds himself so treated, we should do nothing?'. I do not believe that the Foreign Minister would agree to that proposition for a minute, but it illustrates the danger of the kind of approach that in a rather over simplified way he has outlined. The truth of the matter is that we must act quite differently in relation to some countries in support of the rights of our citizens. That is the experience of other countries. For example, contrast an Australian citizen who gets into trouble in Britain to an Australian citizen who gets into trouble in a country of the kind to which I have referred. If an Australian gets into trouble in Britain, the United States or another country where the law applies and where enforceable legal rights apply, the role of the Australian Government is very different from the role it would adopt in, say, the Pantelic case or the Ian Grey case. The Foreign Minister also criticised those who intervened in the cases of Mr Grey and Mr Pantelic. Despite his delicacy in not naming me, it was quite obvious that the Foreign Minister was referring to me. Let me reject and dispose of those criticisms by dealing with the case of Mr Pantelic. Mr Pantelic was charged on the basis that he was liable to Yugoslav law because he was a dual national. The basis of the charge against him rested on actions taken by him not in Yugoslavia but in Australia. A large part of the evidence against him rested upon his relationship with an association in this country, lawful in this country, and actions he had taken in this country that were perfectly lawful according to Australian law. There was the damning fact that he had marched in an Anzac parade. A photograph of him marching in an Anzac parade was in fact tendered at the trial. I went to Yugoslavia. On my way there, I went to New York, where I met with Helsinki Watch, an organisation that looks to the enforcement of the Helsinki accords that relate to human rights. I discussed with representatives of Helsinki Watch the Pantelic case and Yugoslavia and one's approach to dealing with that kind of problem. I then went to London where I visited Amnesty International, discussing with the person there, whose job it was to be concerned with these kinds of cases and whose expertise lay in dealing with Yugoslavia, the Pantelic case and how it should be dealt with-what could be done. I then went to Yugoslavia and, apart from seeing two senior government officials, more importantly for present purposes perhaps, I saw Mr Presel, a senior United States official, the minister counsellor, in the United States Embassy at the time. I saw Mr Pantelic's lawyers. I went to Sabac and saw Mr Radulovic, with whom I discussed the Pantelic case, and then human rights issues and cases in Yugoslavia, because he was a lawyer specialising in human rights work. In Belgrade, I saw Mr Perovic, Mr Pantelic's lawyer at his trial and also on the appeal. Mr Radulovic also appeared at the first trial. Mr Perovic said he would welcome my presence in the court-the appeal was to take place the following day-and he made the point very clearly to me that public pressure on the Yugoslav Government could only assist cases of this kind and that if there was not public pressure and public outcry, people could simply get lost. That was the whole burden of the advice I received in the United States from Helsinki Watch, in London from Amnesty International, from Mr Presel and from the lawyers. Mr Pantelic himself, whom I have seen since he was freed, certainly welcomed my presence in Yugoslavia. I ask the question: Who knows better about these things? Incidentally, I add that two reports have come back to me from sources in Yugoslavia that my presence there for this purpose was valuable or crucial; I am quite content if it was valuable. As to the Grey matter, let me simply say that the focus of the media, together with the actions of Mr Robertson, in my view were the reasons why the outcome was as it was. It is nonsense for the Foreign Minister to say that the intrusion of the kinds of sentiments I expressed put these people in grave danger. From talking to two Yugoslav officials-Mr Matovic, Assistant Federal Secretary (Minister for Justice), and Mr Strbac, Assistant Federal Secretary, Federal Secretariat for Foreign Affairs-it was clear to me that my presence there was valuable from Mr Pantelic's viewpoint. A wide question therefore arises. As I have said, who knows better than Amnesty International, Helsinki Watch, and the human rights lawyers themselves who daily deal with these kinds of cases? If the Foreign Minister had talked to Mr Pantelic's lawyers he would know their views and know that in their view the involvement of world pressure and attention from the media is vital if these cases are to be conducted with the prospect of a good outcome for those involved. Otherwise, people can get lost in the system, because the kinds of rights we have in this country, that we treat as being our birthright, as water and air, do not exist everywhere. Should we take the view that we will not speak out? Why do these countries react to pressure? They react for the very good reason that they wish to have their institutions thought well of. They do react to public pressure. They face the old continuing problem; they seek public acceptance in the Western world. Amnesty International, of which I believe the Foreign Minister is a member, works on the publicity principle. Mr Hayden —No, not a member. Mr SPENDER —The Foreign Minister is not a member of Amnesty; I am in error there. However, Amnesty works on the publicity principle. This Government has itself from time to time rightly criticised abuses of human rights. One example is the criticism made by this Government over the refuseniks in the Soviet Union. The Government has claimed success in getting some refuseniks out, and I commend it for its efforts. That is a good example of a public statement and pressure being exercised by the Government, through the Prime Minister (Mr Hawke), as I recall, stating the Government's position and Australia's position in very plain terms. The Foreign Minister would lead us logically to a situation in which we should never speak out and in which we should leave matters to governments. When an Australian is in trouble overseas, the suggestion is that the wisdom of governments should prevail. Logically, the Foreign Minister must be saying that organisations such as Amnesty International should stay out of these matters and not engage in widespread publicity and attacks on the records of governments, as it does. Why does Amnesty do that? That organisation, probably more experienced in human rights than any other, does it for the very good reason that publicity-pressure-brings results. Mrs KELLY(Canberra-Minister for Defence Science and Personnel) —by leave-In November 1985 the Minister for Defence (Mr Beazley) commissioned a study into the problems facing spouses of service personnel. Before I commence this statement I want to put on record my thanks to the Minister for having the foresight to proceed with this study, because his initiative has led to the fundamental changes in the attitudes of the Government and of the Australian Defence Force (ADF) to the Defence Force family. The Minister realised that circumstances have changed. In the past, service families were expected without question to up stumps and follow the colours, wherever they led and whatever the family circumstances. That is no longer the case, and nor should it be. Community expectations have changed, and so have the expectations of service families. The study the Minister commissioned was undertaken by Mrs Sue Hamilton of the Office of the Status of Women over a period of five months. The Hamilton study broke new ground. It identified, for the first time, all of the issues that service in the Australian Defence Force creates for the spouses and families of its members. It recognised that ADF policy should pay real attention to the needs of the spouse and family, to their quality of life and to the effect on them of a member's service in the ADF. The Hamilton report had no predecessor, and no substantial research base to work from. No broad examination, investigation or study had looked at the needs and wants of the people who, though they are not bound to the Australian Defence Force by service, are deeply affected by its policy and day to day decisions. In the course of the study Mrs Hamilton travelled to all States and visited all areas with major concentrations of service personnel, as well as a number of smaller bases in remote locations. Open meetings for spouses were held in every area visited. Attendance at these meetings totalled about 4,300. Over 700 written submissions were made to the study. Many people took the opportunity to air their views through radio phone-ins around Australia, by private telephone contact or by office visit. Contact was not limited to individuals. Mrs Hamilton also had discussions with commanding officers, administrative staff and other serving personnel in the areas she visited; with chaplains and welfare staff attached to bases; and with civilian agencies in areas around bases. The Hamilton report is therefore thorough. I am pleased to report that the Government's actions in response to the recommendations of the report have been flexible and comprehensive. The first recommendation Mrs Hamilton made was for a clear directive to be given at ministerial level that the issue of family morale in the Australian Defence Force is one of high priority. My colleague the Minister for Defence (Mr Beazley) gave his personal commitment. The Government expressed its commitment by appointing me Minister for Defence Science and Personnel. My actions since assuming this Ministry confirm that commitment. Since my appointment I have made extensive visits to defence bases throughout Australia to talk to service members and their families and to gauge for myself the issues that concern them and the problems they face. These visits have given me a vital insight into the sheer size of the Defence Force and the variety of places in which service families live and work. These visits have taught me that, above all, our efforts to improve the quality of life for defence families must be adaptable. They must allow for the local and regional differences between the many places-from capital cities to remote and isolated communities-that service life takes people to. Different places require different assistance and people moving from one place to another have different needs in different places. Service life can mean one can move from Canberra to Puckapunyal and then to Townsville or Melbourne. The operational and training needs of a service career demand postings. Many, if not most, of the unique difficulties that affect service families derive from this inevitable need for postings. The Hamilton report recognised the problem and its importance. The Chief of the Defence Force, General Gration, recognises it, and so does this Government. Following the Hamilton report we employed an independent firm of management consultants to examine the policies on promotions and postings in the three Services. It concluded that the incidence of postings is at a level consistent with the operational and training needs of the Australian Defence Force. At the same time, it made recommendations to assist in achieving a balance between the requirements of service and domestic life. The Chief of the Defence Force has determined that postings will be for three years, subject to operational exigencies. Further, a policy of back to back postings in the same locality will be pursued wherever possible, giving those who want it stability for up to six years. I do not want to give the impression that moving from place to place is necessarily an unwelcome thing. Many defence families and many of their children enjoy the variety of a service life and the range of experiences they gain from it. What the Government must try to do is to find the best way it can to ease unnecessary burdens and pressures on families when they are posted. One very important means of helping a family to adjust to a new location is to provide as much information as possible to the family about the place they are going to. Families need to know about schooling, about the availability of employment for spouses, about child care and community services. The Hamilton report identified this need and made recommendations about it. They have been implemented. The Government has set up the Australian Defence Force Family Information and Liaison Staff (ADFILS) to provide community development and education support for service families throughout Australia. ADFILS headquarters in Canberra coordinates an extensive network of full and part time professional staff. The recruitment program to fill all the positions that have been created is well advanced. In all there will be one senior community development coordinator, six community development coordinators, eight regional education liaison officers, and 30 community development officers. In addition, 51 family liaison officers have been established in the Services to act as the first point of contact for families. They will operate as a supplement to the support systems that have been run by the individual Services for many years. The regional education liaison officers will provide professional advice and assistance to service families and to the family liaison officers, establish and monitor the education needs of families and represent those needs to State governments and authorities. The community development coordinators will provide the essential link between civilian and service communities and ensure the smooth delivery of support services for defence families. They will also select, train and monitor the 30 community development officers who will be based in areas of major service concentration. This extensive professional network will be a boon for mobile families. It will make reliable information easy to obtain and assistance readily available to any family that needs it. ADFILS is a very important source of direct support to Service personnel and their families and I confidently predict that once it is fully operational-and that will be soon-the network will prove to be the most valuable resource that Government has ever provided to service families. It is essential that all members of the Australian Defence Force know about ADFILS and the services it has to offer. Communication is effected through ADFILS outposted staff, by the regular publication of a newsletter and by frequent contributions by ADFILS to the three service newspapers. I make it my business whenever I visit a base to talk to servicemen and servicewomen and to spouses groups to raise with them family issues, so that everyone I can reach is up to date with their entitlements. Close attention has been given to the prompt settlement of claims for compensation submitted as a result of loss or damage to goods during removal. The spouses working party on removals, on which service spouses are represented, keep a close eye on the efficiency of removals. There is evidence that all aspects of removals have improved considerably. Disruptions to children's education can be a major problem for service parents. The frequent requirement for interstate postings means children, particularly those at important points in their schooling, may suffer disadvantages. We are currently taking action to minimise any bad effects. My consultant, Mrs Mayer, is currently working on obtaining agreement with State education authorities on uniform reporting processes. We have developed a pilot scheme to introduce a student portfolio into schools with a high service population. The portfolio will contain examples of the students' work and interests that will be portable from school to school. This will assist teachers to place students at the right level and give them vital information about what a student has learnt at the previous school and what has been missed out. The student information portfolio has been introduced in every State and Territory and has been enthusiastically received by service parents. I would like to see a common-core curriculum introduced in high schools that have a high defence population. This will involve complex negotiations with the Directors-General of Education in each of the States but it is the direction I want to pursue. The student portfolio is only one of a number of initiatives we have taken in an area that is clearly of great concern to defence parents. I have introduced an extra tuition allowance payable for children in the last two years of primary or in any stage of secondary school who move as a result of a posting. Where needed, extra tuition for up to six weeks will be available, with tuition fees being reimbursed up to a maximum of $40 a week. The eligibility criteria for the education allowance have been broadened. In the past, education allowance was restricted to children who would suffer serious interference to their education if required to change schools as a result of a posting. The new provisions give the approving authority greater discretion also to consider the impact of the member's next posting where that is likely to cause serious interference. This will particularly help members on short duration postings to remote areas, such as Tindal. In writing her report, Mrs Hamilton talked to many service spouses to find out what they thought. This process of consultation proved so useful that Mrs Hamilton recommended the establishment of a national consultative group of service spouses. This group was established in 1986 and its expenses are funded by the Department of Defence. Members come from all over the country. The aim of the group is to improve the quality of life for service spouses and their families. The group provides a forum for their views and a mechanism to make recommendations to me and to the Chief of the Defence Force. Service spouses; thus for the first time are in a position to influence the policies that directly affect service families. That is quite a unique move: in this country for the first time we have formal channels so that the spouses can officially put views to Ministers and to the Chief of the Defence Force. Mr Deputy Speaker, as you can tell from what I have listed so far, the Government's implementation of Mrs Hamilton's report has been both flexible and comprehensive. We have set up support networks and employed professional help, as well as introducing new conditions of service where that is a more effective and appropriate response. Child care is an issue that shows how this combination of responses works. Approval has been obtained for reimbursement of child care expenses for up to two days during removals where only one spouse is available to do the moving. Discussions on the child care needs of service families were held with the then Department of Community Services in the wake of the Hamilton report. A number of centres were identified where there was a mutual service and civilian interest in community child care. Centres which have been or are soon to be established as a result of these discussions include Townsville, Katherine, Wagga, Nowra, Rockingham and Hastings. I recognise that service families have to compete for places at these centres and that they are disadvantaged by their frequent removals. Nevertheless, these facilities do contribute to meeting the needs of service families living in these areas. I am currently working on a comprehensive defence policy on provision of child-care support for defence families. I am committed to improving the level of support available to defence families in recognition of the special pressures which Defence Force employment imposes in a society which is changing. Self-help will continue to be an important element though, in my view, some employer support by defence is also warranted. I hope to have policy guidelines formulated in time for consideration in the lead up to the August Budget. Meanwhile, approval has been given for licensed family day care schemes to operate from service married quarters and for surplus defence facilities to be used to house child care centres. Limited child-care facilities have already been established at some bases. I opened the new centre at Swanbourne in Western Australia earlier this year. Next month I go to Enoggera to open the occasional care centre and kindergarten there. Because of their mobility, service spouses often find that they are discriminated against in obtaining employment. This is not only unfair but a terrible waste of talent. Recently I met some service spouses at HMAS Stirling. I will just quote an example because it gives honourable members some idea of the way they are treated. A woman told me that she had applied for a job, and when asked what her husband did, she replied that he was in the Navy. No job was forthcoming. She called again the next day using her maiden name. This time when asked what her husband did she said that he was engaged in underwater research. She got the job. I think it is a total waste of talent for these women to be discriminated against in this way. I am presently undertaking a series of visits to speak with employers about this problem. I am being helped in this regard by the Committee for Employer Support of Reserve Forces. I take this opportunity to pay thanks to Allan Edwards, the Chairman, for the support he has given me in this exercise. My aim is not preferential treatment for these women, but simply to make sure that service spouses get a fair go in employment. There are several other initiatives which the Government has pursued to improve the lot of service families. Legislation will be introduced today to amend the Defence Force Retirement and Deaths Benefits Act. The purpose of the amendment will be to allow retiring members to make an election, up to three months before retirement, to commute a proportion of their pensions to a lump sum for payment on their retirement. This will minimise if not entirely remove any delay between severance and receipt of the commutation lump sum. Members of the Australian Defence Force are now entitled to four reunion visits each year if they are separated from their spouses on long term postings. If the serving member is posted to a remote locality at the time that his or her children are finishing their last years at high school, or if his or her spouse has compelling career obligations, the family might decide that their collective interests are best served by the temporary absence of the serving member. In a case such as that reunion visits are a crucial element in maintaining family stability. To alleviate the disruptions to families who are presently required to move to a new locality when a member is posted, consideration is being given to a proposal that the member be able to decide, having regard to family needs, to defer movement of the family and continue to receive housing assistance at the old locality. This proposal is one of three that are under consideration by my colleague the Minister for Industrial Relations (Mr Willis). Another important recommendation of the Hamilton report also under consideration by the Minister for Industrial Relations is disturbance allowance. With regard to disturbance allowance, the rates for the third, fourth, fifth and sixth moves are being reviewed. Possible inequities relating to members without families are also being considered. The overall aim is to fairly reimburse service personnel for movement necessarily incurred by the needs of their employment. An improved means of recognising and compensating members for the costs involved in the movement of their household pets is also under consideration. One of the additional costs associated with removals is that involved in complying with State regulations. Drivers licences are an example. My consultant has been meeting with State authorities to try to obtain a more tolerant approach. If I had my way there would be a national drivers licence for Defence Force personnel. Unfortunately, I have been advised that constitutional difficulties might be encountered in unilaterally pursuing such an objective. So we will have to proceed via the States. No statement about service families would be complete without talking about housing. The Hamilton report made no specific recommendations about service housing, apart from indicating that there was a problem and that measures to address it were under way. They certainly are. On the 1 January the Defence Housing Authority was set up. The legislation establishing the Defence Housing Authority ensured the flexibility to manage defence housing commercially, to reduce management costs and delays in deliveries and to improve maintenance. The Government has pledged that $750m will be made available to the Authority over 10 years for acquisition and building of new houses and for improving our current stock. That is a very significant financial commitment and one that means a lot to defence families. The reality has far exceeded the promise. An amount of $73m was earlier provided for capital expenditure on housing this financial year. An additional $46m for the Authority has just been announced, $10m of which is for essential improvements such as security locks; the extra $36m is for spot purchasing of houses and land for defence families where the need is greatest. This brings to $119m the funds committed to improved defence housing this financial year. Including the measures implemented in response to the Hamilton report, annual defence expenditure which contributes to supporting service families totals some $193m. That is over $5,000 per year for each married member of the Australian Defence Force. The benefits of what we have done are not merely economic. The real benefits lie in the process of communication that we have made possible and in the understanding and flexibility of administration which follows. The flow of information between families and headquarters is guaranteed, and guaranteed to flow both ways. Spouses are represented at the centre, where policy is decided, and they are supported locally when they need information and help. Commanding officers on bases are involved and their support is crucial. The result is a vastly improved system of reciprocal communication. That is the improvement we have made that forms the basis for all other improvements, both now and in the future. In three years we have addressed problems that have been building up and festering for decades. It is a record of initiative and achievement that we can be very proud of. It is unshakeable evidence that this Government cares about the people, whose work it is to defend this country, and their families. I present the following paper: Hamilton Report-Implementation of Recommendations-Ministerial statement, 27 April 1988. Motion (by Mr Beazley) proposed: That the House take note of the paper. Motion (by Mr Beazley)-by leave-agreed to: That so much of the Standing Orders be suspended as would prevent the honourable member for McPherson speaking for a period not exceeding 20 minutes. Mr WHITE(McPherson)(3.49) —I thank the Minister for Defence Science and Personnel (Mrs Kelly) for making a copy of the statement available in good time. I hardly know where to start on this matter. On the very day that the problems of the Royal Australian Air Force have overwhelmed the Government, the Minister comes into the House and tries to solve the problem in a panic reaction by dumping $70,000 in the lap of a few selected RAAF pilots. On the very day the same Minister has the hide to come in here and tell us how much the Government has done and is doing for the Services. I must say that, for a woman, she has a hide as thick as an elephant's. Mrs Kelly —Do you support the $70,000? Mr WHITE —I certainly do not. I will have a bit more to say on that in a moment. Basically the Minister's statement concerns the report of the Hamilton Review of Effect of Service Life on Spouses. The Hamilton report was presented to the Government in April 1986-nearly two years ago. Since then, very little has been done. As in all defence matters, the Government reacts only when it has to, usually too little and always too late. All the birds have flown or are flying out. The Government is trying to hold back an enormous tide with a broom. The announced $70,000 bonus for pilots is nothing but a desperate move by a very desperate Minister. Yesterday in this House, in answer to a question from me, the Minister for Defence (Mr Beazley), who should be taking an interest in personnel matters but never does, said that of course the RAAF is operational. Twenty-four hours later, his assistant Minister is in the House saying that we have a desperate plight on our hands, that the RAAF is collapsing and that we have to give $70,000 to a few selected pilots. What a joke. The Minister comes in here and says that we are going to train our way out. This year we will lose 140 pilots or thereabouts. The Government has the capacity to train about 70 pilots a year, if that, by the time it has complicated matters with its new fancy PC9 aircraft and all the other problems. It thinks it is going to train its way out or bribe its way out with a few selected pilots. It is a joke. The pilot retention scheme, if that is what we can call it-it is bribery that the Government is offering-will be condemned within the Services and without. The Armed Forces Federation of Australia, has already put out a Press statement, which I have seen, universally condemning it, and so it should. The Government has had to resort to this bonus scheme because it has not paid attention to improving pay and conditions of service across the board. What does it think is going to happen? It is going to give a bonus to a few pilots. What about all the rest of the RAAF, the air crew and the pilots who do not get it? What about all the Royal Australian Navy personnel who do not get it? What about the Army people? What is the Minister doing for them? They are no doubt reading her announcement now, saying, `This is what they think of us; nothing for me. It is only when the Government gets a political crisis on its hands that it is forced to do something'. The Government is offering very little indeed. It is offering $70,000 over six years. As I understand it, it is to be taxable, which brings the figure down to about $36,000. When we divide that by six we see that the amount will be $6,000 a year. Does the Minister think she is going to bribe these people for another $6,000 a year to get her out of an enormous political hole? Half the speech that we have heard this afternoon tells us nothing but that the Minister will look into the situation. The improved conditions that the Minister has announced, late as they are and little as they are, are welcome but the rest of the problems she says she is looking into. Before she knows where she is, people will be calling her the mirror Minister. She is always looking into something. We on this side of the House have been warning the Government for the last two or three years about what is happening to the Australian Defence Force. I have been saying in recent months particularly that it is falling apart, that the Minister is presiding over the dismemberment of the Australian Defence Force. By her actions today, that is exactly what she has proven. She keeps on telling this House, `All is well'. Yesterday the Minister for Defence said, `How dare you ask a question about the operational viability of the RAAF? Everything is all right; there are no problems'. Yet today the Minister has come in here and tried to dump $70,000 on a few selected pilots. Does she think that is going to fix the dismemberment of the Australian Defence Force? What a joke. No-one has believed her when for months she has said that everything was all right. I can only presume that she thought everything was all right. It just shows the arrogance, the neglect and the disinterest of her Government in defence matters. Does the Minister not understand what is happening to the forces? Maybe she understands at long last what is happening to the RAAF. Does she not understand what is happening to the Navy, whose operational capabilities have been cut back month by month, and to the Army, which is desperately short of men and cannot sustain itself in the field? Does she not understand that 27,000 people have been lost in the last three years? Does she not understand that the Army has lost 10,000 men and something like 1,200 officers in the last 15 months? Thirty sea commanders have been lost from the Navy, plus many engineers. Some of those losses have been from the command of ships. Never until recent years have I heard of people giving up a command and leaving the service. It is the pride and objective of every serviceman to have his own command, and it was unheard of until the Minister took the helm for people to leave the service when they were in command of a ship or battalion. The experience levels have been drastically reduced in every Service. The Chief of the Naval Staff, in a submission two weeks ago to the Joint Parliamentary Committee on Foreign Affairs, Defence and Trade, which is looking into Defence Force wastage, said quite clearly that all he could look forward to was more collisions, more accidents and more groundings at sea. The trend, he said, is increasing. The Otama incident in which, unfortunately, two men were lost, was, as the Chief of the Naval Staff said, a partial result of the low experience levels in the submarine service. Those were his words. Mrs Kelly —He did not say that and you know it. Mr WHITE —He did. While all this is going on, the Minister for Defence Science and Personnel parades around the country saying, `High wastage rates are good for the Services'. The Services have lost 27,000 personnel in three years. The Minister might care today to modify that view. Yesterday in this House the Department of Defence made an absolute fool of the Minister for Defence. As the result of the Minister's sheer neglect of the Department, it openly conspired to deceive this Parliament in reply to a parliamentary question. The honourable member for Hughes (Mr Tickner) is in the House and presumably is going to speak. I hope he is going to pursue what he said publicly and get to the bottom of this matter. The Department made a fool of the Parliament and made a fool of the Minister for Defence. That was yesterday. Today, what do we have? Not 24 hours later, after the Minister has said, `All is well in the RAAF', the assistant Minister has come in here and said, `Things are crook; things are desperate. The RAAF is falling apart but we are going to fix it by giving a few pilots a selective bonus of $70,000'. Within and without the Services both Ministers are now considered as a joke, and in certain areas they are regarded as positively dangerous. Let us turn to the contents of the statement that was put down today. Some of it is certainly welcome but it does not go very far. It is two years late and it is too little. There is very little in it of any great substance. At the beginning of the statement the Minister uses the word `flexible'. She says that one has to be flexible about these matters. What does that mean? It means that one has to be nimble on one's feet; that one does not do anything until one is forced to do it. That is what flexible means to the Government. The Minister said that there has been a clear ministerial directive that family morale is to be regarded as a high priority. Does the Government think it will fix morale by having a discredited Minister standing up and saying that family morale is to be a high priority? They are like the words of King Canute and they will be about as effective. The Minister went on to say that the Government has maintained its commitment by appointing her as Minister. I can tell her that she is not regarded as a blessing in the Services. What will make her name is her announcement today about a $70,000 bonus. That will live for a long time. All it will do is create an enormous number of problems. She is already well known for not appearing at spouses meetings when they ask her to go and, best of all, for initiating the spouse guidelines on how she should be treated-- Mrs Kelly —You know I did not initiate those. Mr WHITE —Why did the Minister not disown them? She never did. Mrs Kelly —They were not mine to disown. Mr WHITE —The Minister never asked for them to be withdrawn. On page 4 of the statement it says that the Chief of the Defence Force has determined that postings will last for three years. Does she not understand what is happening out there? Every time a gap appears because someone resigns someone is plucked out of somewhere and shoved in the gap. Does she not understand that postings being for three years is an impossible dream under her administration and the problem is getting worse? Did she not hear the service spouses say last night that it is an impossible dream? How can postings last for three years when we are surrounded by the shambles of posting policies that she has created? I turn to the question of Australian Defence Families Information and Liaison Staff. We are all pleased to see this recommendation implemented in part-two years late and certainly not as recommended by the Hamilton report. It is still not properly in place and no-one has yet seen the full benefit of it. The Minister talked about her consultant, Mrs Mayer. Let us get this straight: Mrs Mayer is a failed Labor politician. She is not a consultant. She has no experience in this matter. She was put on because she was out of a job-jobs for the girls. She has been running around trying to introduce some pilot education scheme. As I understand it, the scheme and the concept are already well in place so I do not know exactly what she has done but I know she has cost us a lot of money. I turn to the National Consultative Group of Service Spouses, a great bunch of women trying to do a very difficult job which the Government will not give them the resources to do properly. The Minister talked about what the Government has done for child care. Why does she not do something sensible for child care instead of saying people have to rely on self-help? Why does she not make some facilities available in the big bases and staff them and welcome women who have jobs into these centres instead of saying, `We will give you this old broken down building but you must make a go of it.'? Why does she not do something positive for them? Where are the spouse employment offices? Are they in place? No, they are not. Yet the Minister rabbits on about how important it is to get jobs for the 70 per cent of service wives who want to work. I heard the story today from the Minister about the woman at HMAS Stirling who could get a job only when she gave her maiden name. Is that a revelation to the Minister? How long does she think that has been going on? She talked about the Defence Force retirement and death benefits (DFRDB) scheme and allowing the election of early commutation. That was announced in September 1987. It is still not in place. Why does she not do something positive about DFRDB? Why does she not eliminate the anomalies, particularly about officers' ages? Why does she not look at the portability and top up provisions which are non-existent and interest on contributions? The reason the Government will not do anything about DFRDB is that it knows that if the scheme is opened up for review honourable members opposite, perhaps excluding the honourable member for Hughes, who seems to have a genuine interest in defence matters, will try to rip the DFRDB system off the hook altogether. The Minister talked about improving education and the education allowance. At last count something like 80 out of 70,000 people were in receipt of education allowance. The Minister talked about looking at the disturbance allowance. Here is the rub: Who is going to look into the disturbance allowance for the men and women in the Services? The Minister for Industrial Relations (Mr Willis) will. So we will get all the hufty-tufty of the Australian Conciliation and Arbitration Commission guidelines and `Can you do this?' and `Can we have a bit more productivity here?'. Why is it that the Minister for Industrial Relations has to get involved in deciding conditions of service for members of the armed services? They are not public servants. They belong to a unique profession and it is about time that the Government treated them as such. We saw in the last pay case what happens when the Minister for Industrial Relations gets involved in service matters. I am very pleased to see that the Minister is considering compensating families for moving household pets-very important. The result of today's statement will be very little. The benefits are not yet flowing through to service families. The Minister is flailing around trying to use a cosmetic approach to an enormous problem. While the very security of this country is falling apart in front of the Government's collective noses it is deciding about household pets. Today it tried to do a quick fix on the Air Force. Tomorrow no doubt it will be the Army and the day after, no doubt, it will have a quick fix for the Navy. Why does it not do something positive and meaningful about home loans, which it has been talking about for three years? Why does it not restore the entitlement to all who join the Services? Why does it not lift the ceiling that has been there since 1980? Why does it not offer an option of a cash grant and all the things the Minister thought she would like to do? Why does she not address the pay and conditions in the service that the Chief of the Naval Staff, Admiral Hudson, and the Chief of the General Staff, General O'Donnell, submitted to a joint parliamentary committee two weeks ago? And while she is at it, why will she not answer the question why she, the Minister for Defence or the Department tried to get Admiral Hudson's submission back from that committee? It is quite obvious that what he said in that submission was not to the Government's liking so it tried to get it back. I think it is very interesting that the one Service that is having the most problems did not put in a submission. If the Government wanted to do something meaningful for the Services it would spend in this area the $200m that it says it is proud of saving-and well done-through better management of the defence forces? It could do all of this for $200m-give some meaningful pay rises, have a total review of pay and conditions and put some guts back into the services. But it will not do it. It will fiddle around the edges while the Services fall about under its feet. It is creating an enormous shambles. Mr DEPUTY SPEAKER(Mr Mountford) —Order! The honourable member's time has expired. Debate (on motion by Mr Lindsay) adjourned. Bill returned from the Senate without requests. Mr DEPUTY SPEAKER(Mr Mountford) —Madam Speaker has received a letter from the honourable member for Ryan (Mr Moore) proposing that a definite matter of public importance be submitted to the House for discussion, namely: The confusion created within the business community by conflicting statements from Government Ministers on future economic policy. I call upon those members who approve of the proposed discussion to rise in their places. More than the number of members required by the Standing Orders having risen in their places- Mr MOORE(Ryan)(4.11) —Today's matter of public importance is about the community's concerns relating to the direct consequences of conflicting statements made by members of the Labor Government. As the May economic statement approaches, debate within the Government's ranks heightens over government spending and taxation and moves towards privatisation and the uncertainty in the business community becomes more intense. Simply put, the Hawke Government is in economic disarray. Conflicting and confusing remarks are emanating from every corner of the Australian Labor Party. While the Prime Minister (Mr Hawke) is promising tax cuts, another Minister is promising tax increases. One Minister, the Minister for Finance, Senator Walsh, is advocating spending cuts. The same Minister is advocating increased spending. While the Industries Assistance Commission, with the Treasurer (Mr Keating) at its helm, is advocating less protection, another Minister, the Minister for Home Affairs, Senator Robert Ray, is seeking to ensure that protection remains at current levels. One wonders whether, when the Prime Minister said that there would be less taxation, he was acting with Cabinet authority. If he was, the other Minister was speaking in direct contradiction to the authority of that Cabinet decision. If the Prime Minister was not acting with Cabinet authority, if he was just speaking off the top of his head, tax cuts must be one of those things. We remember when he said, `There will be no capital gains tax'. When we hear some of the other remarks of the Minister concerned we might think that he will get rolled in that area. Who is accountable for what is going on? Who is calling the shots? What direction is the Government taking? This weekend, at the Young Labor Conference, we heard the Minister for Employment and Education Services (Mr Duncan) calling for increased government spending and increased taxes. He said: We must face up to the hard issues of increasing tax revenue . . . The Minister prefaced his remarks with a quaint history of the Labor Left's prominent role in making Australia one of the highest taxing countries in the world. He said, no doubt beating his chest: . . . for me the Left is the faction which provides the vision for the Party as a whole . . . It was the Left which provided the background research for the capital gains and fringe benefits taxes . . . There is an admission and a half. That is not bad for the Left. We know who won that battle. `There will be no capital gains tax' said the Prime Minister. Fringe benefits tax was a latecomer, certainly not a tax the Treasurer was trying to promote amongst all his cigar-smoking mates. The Minister continued: Many policies of the rational Left- that is quite an admission- involve an increase in government spending-more education, more industry policy, more care and assistance for the less well off. That is what one might call the traditional Labor position-higher taxes, more spending and more protection. Let us consider the economy-the balance of payments situation, the high interest rates, the level of the Australian currency. Yet we have a Minister making these remarks. I get back to the question of whether he was speaking with the authority of Cabinet. Was the Prime Minister speaking with the authority of Cabinet when he said that there will be tax cuts this year? If he was not, quite clearly we have a conflict of significant proportions in this area. This hardly jives with the remarks the Prime Minister was making over the weekend. I doubt whether the Prime Minister, when he heard the Minister's comments, would have been greatly amused. He would have been faced with making a decision as to taking disciplinary action against the Minister. If the Minister is acting against the advice of Cabinet he should go. Therefore, the position of this Minister comes under question. At Question Time today a proposition was put to him. He was asked whether he was representing government policy. While he attempted to muddy the water at no time did he retreat, in essence, from the comments he made at the weekend. His excuse was that he made the remarks in the context of increased business taxation. That is quite a turnaround. He said that he was not talking about personal tax, which the Prime Minister was talking about, but about business tax. Business tax is the very topic upon which this matter of public importance is based. It is the business community's concern about taxation that the Government says it will address in the May statement. The Government has said that there will be no loss of revenue, but there will be an attempt to bring business tax down to make business more competitive on an international basis. Yet the Minister corrected his statement on taxation to say that he was talking about business taxation. Even if the Minister continues to defend his tax statements by suggesting that he was referring to business taxes only there is still a very real cause for concern among the business community. Not only does the Minister's statement run contrary to the Treasurer's promise to reduce business taxes but it has a devastating effect upon the confidence and optimism of the business community. Investment is essential in Australia. The long term development of sustained economic growth is dependant upon private investment, particularly in the capital area. Investment is designed to increase the capacity to produce, raise productivity and reduce costs. All of these factors must be seen against this uncertainty. Investment is the engine of economic growth. Without it we will be lost as living standards fall, as Australians know all too well today. The economic climate in Australia is still not right for investment to take place. Investment has remained unaccept- ably low since it peaked in 1982. Investment has declined markedly in relation to gross domestic product (GDP). No wonder. How many honourable members recall the famous J-curve? We have not heard much about it for a long time. The J-curve has disappeared. It has got lost somehow or other down the track. It has got lost in the continuing balance of payments debt. The debts roll up every month, $1,000m a month. Last year it was $14 billion to $15 billion, as it is this year. Yet the Government does nothing to address the basic problems in Australia. As I said, the economic climate is still not right for investment. Investment has declined and continues to decline. Investment grew by less than one per cent in real terms in both 1985-86 and 1986-87. Average investment as a proportion of GDP in Fraser years, 10.5 per cent, contrasts starkly with the flat figure of 9 per cent under the Hawke Government. Despite falls in interest rates, new private investment remains low. A slight reduction in interest rates will not be enough to spark an investment revival. This must be seen in the context of the poor performance of the balance of payments. Interest rates in this country are unlikely to fall while the balance of payments debt continues high. The Government has failed to address other contributing factors-the uncertainty in our ability to preserve gains in competitiveness beyond the short term, large depreciation-induced increases in the real cost of imported investment goods, areas of underutilised capacity in the economy, increases in the less capital intensive service sector's share of economic activity, high interest payment commitments eroding retained earnings, unease and an end to the easy funds following the end of the long bull market. Most disturbingly, private business fixed investment in new plant and equipment is declining. The Coopers and Lybrand monthly bulletin has highlighted this point. It states: As a share of economic activity, private investment in plant and equipment is now lower than at any point for well over 20 years. There will certainly be no temptation to invest until there are real signs that more stable economic conditions will prevail. This situation appears a long way off, particularly given the chaotic situation which exists in the Labor Party Cabinet. Meanwhile, as Australia stagnates, investors are turning to overseas opportunities. While total private investment in Australia increased by only 5 per cent in real terms between 1980-81 and 1986-87, Australian investment abroad increased ninefold-a fair indication of what the business community thought of this Government. Australian investment abroad has exploded in recent years as companies have voted with their feet for better returns. Labelling these companies as unpatriotic is simply absurd. It is a hard and fast fact that Australian investment is just not as attractive as overseas investment. We cannot blame enterprises for moving offshore to countries where governments and unions offer a more predictable and stable investment environment. While this continues, investment in this nation will be hard to get. Meanwhile, while that problem is on the boil and investment opportunities in this country diminish and more opportunities are looked for overseas, we must turn to the Government's debate on privatisation. It is in this area that substantial amounts of money are looked for by our public enterprises. The major public enterprises run by this country, which are supposed to be profit oriented, have their hands out for considerable amounts of money-the Commonwealth Bank, $1,600m; Australian Airlines, $300m; Qantas Airways Ltd, $500m-all over a period of time. These enterprises must be funded within Australia and the halted move towards privatisation within the Australian Labor Party will have to face a decline in the desire to invest in Australia if profit performances are not maintained. I turn again to the worthy Minister for Employment and Education Services. He came up with a few more wisdoms on how to handle privatisation. He said: I am a democratic socialist. I believe that the people of Australia have a right to share in the wealth that they create. There is nothing wrong with that. He continued: I do not believe we will achieve that by handing over to the private sector those Government business enterprises which return significant gains to the Government in revenue. That hardly faces the test of reality, because the contribution to government revenue of Australian Government enterprises is very small indeed. This points to the fact that democratic socialists are not good at economics. To add to that confused situation, I turn to another democratic socialist. Five months ago the Prime Minister ventured: I can't see any social democratic principle that is involved in government running an airline. That is not a bad difference of opinion, but we can go one better. In March 1988 Mr Hayden-the old doyen of the Party, the one run out of town by the New South Wales Right, the poor old Queenslander who went down the chute, had this to say: I am a democratic socialist. I've said that often enough and public enterprise is important to me. There we have three different views. No wonder there is absolute mayhem about what this nation will do with its public enterprises. Which social democrat do we believe? Which will will prevail in the famous June conference? To add to that, another social democrat-this time Senator Evans-said: Under the pessimistic scenario and without additional capital the airlines would be unprofitable beyond 1991. So the reality comes through. Yet while all this has gone on, where is the Treasurer, this new found friend of business, the guy who will travel only behind the smoked windows of an unmarked Commonwealth car when he goes back to his home city of Sydney? He has so much affinity with the world that he has to get around in an unmarked Commonwealth car with darkened windows. Mr Howard —He wears a disguise in Bankstown. Mr MOORE —Yes, there is no doubt about that. He stays in Canberra not just to get his travel allowance but also for his own safety, apparently. The conflicts of interest that have emerged within the Government are enormous. Across the board we have had conflict in relation to taxation, including the positions of the Prime Minister, the Treasurer and another Minister. We have had conflict in the Government because of the views put by the Industries Assistance Commission report, the Treasurer and Senator Ray. We have the conflict between Senator Walsh, the Minister for Finance, and another Minister saying we must spend more or we must spend less, and while all this goes on no-one outside knows what is going to happen in the May economic statement. As a consequence of that, the business community in this country at present will not look to invest $1 more than is necessary, $1 more than its current level of commitment. It is a shambles, a disaster for Australia, and we must look at the consequences in the lead-up to the May statement. Mr RONALD EDWARDS(Stirling)(4.26) —I suppose I should say we have just heard a brave attempt at a speech by the honourable member for Ryan (Mr Moore), because at the moment the Opposition parties are in an extraordinary state. We see confusion and we see division. I need only remind honourable members opposite about their media policy and what is going on in their party rooms at the moment. Mr Peacock —We have a very good media policy. Mr RONALD EDWARDS —The honourable member for Kooyong is also a brave member of the Opposition but he is not brave enough to get on top of the current division within his Party. Honourable members opposite talk about investment, but in the case of the Bond media group or Skase where does the Opposition stand? We know where we stand-we have gone for the 75 per cent rule-but we do not know where the Opposition stands. We are not sure where it stands. That is just another aspect about which the Opposition is unable to create policy. It has been five years without one. It has not been able to develop any media policy. What about tax policy? Let us turn our attention to that. We are not sure in whose court they reside when it comes to tax policy. But there is one certainty, and that is that the former Premier of Queensland is now off the backs of members of the Liberal and National parties. They can get on and have a rational debate, as they did when they were in government and sought some rationality in policy. They do not have a rational tax policy now. We are not really sure whether they are being led by the President of the Liberal Party, who wants to move towards a consumption tax, or whether they are being led by the parliamentary members of the Liberal Party, who want to reject the consumption tax notion. Will we find that members of the National Party will overrule members of the Liberal Party at the last minute and say, `This is the way it is going to be'? One certainty about tax policy is that under this Government equity and fairness have been put back into the system and all the rorts injected during the time of the Liberal-National Party have been taken out. We hear about confusion in the community at the moment, and there is confusion about the Opposition's tax policy. The difficulty members of the Opposition face is how they can revert to all the rorts and all the schemes that were developed when they were in government. That is the difficulty they face. They are on record as saying that they would go back to the free lunches, they would go back to the system of having no capital gains tax. They are on record as saying that; there is no doubt about it. If they do away with these base-broadening measures, where will the money come from? Mr Elliott's answer to that is very straightforward; they will have a consumption tax. The Leader of the Opposition, the honourable member for Bennelong (Mr Howard), is in a different situation because he is not really sure that he can go down that path. We know that the National Party will not allow the Opposition to do that; they will do what old Joh told them to do. They will jump on the Liberal Party when it comes to whether or not there will be a consumption tax. It will not be possible for the Opposition to come up with a sustainable tax policy. The electorate understands that. The people remember very well the inefficiencies and inequities in the tax system that existed when those opposite were in government. Now members of the Opposition are simply reminding the people of the confusion evident then. They can remember that in the Crown Solicitor's Office in Perth there were those unchallenged cases sitting in the bottom drawer, when the Federal Government was not willing, under the Liberals, to take on tax rorts in Western Australia, my home State. The honourable member for Cowan (Ms Jakobsen) will be following me for our side in this debate, and we were both operating then in a climate where we knew that tax rorts prevailed and the Government of the day and its Treasurer, the honourable member for Bennelong and now Leader of the Opposition, did not have the courage to take them on. I will say this in defence of the honourable member for Bennelong: in 1978, 10 years ago, in an address to the Institute of Chartered Accountants conference in Perth delivered on his behalf by the then member for Balaclava, now the honourable member for Goldstein (Mr Macphee), he said, `Your profession is going to have to get rid of these unacceptable practices'. As early as that he recognised there were unacceptable tax practices. The Curran and Slutzkin schemes were but part of that, but honourable members opposite did not have the courage to take that issue on. Come 1981, by the time the deals had been done behind the scenes, they did not have the courage to take on the question of tax reform, so we had to take that on when we came to government. There is no doubt why members of the Opposition are going through these hoops and curls at the moment over tax policy. There is no doubt why they are going through them over media policy too, because they do not know whom they are trying to please. So when honourable member opposite talk about confusion, let us get the record straight. The confusion exists in the Opposition because what members opposite have always lived on-and this is true; this is the case-is a quick fix, that they can get over the line in an election and suddenly find themselves back on the right side of the House. I have bad news for the Opposition. Those days are long gone. The 1975 quick fix, sponsored by the right honourable member for New England (Mr Sinclair), supported by the Governor-General, where honourable members opposite can quickly fix up a government and stitch it up over night, those options have gone. Now honourable members opposite have to put policies before the Australian community and they cannot do it. We are watching all the little meetings that are going on round here at the moment about media policy, let alone what happens in tax policy. We saw what happened down in Melbourne over tax policy. The Opposition tried to patch up a deal, but it cannot do it. It cannot have a quick fix any more where it can just get over the line, because suddenly honourable members opposite are going to take advantage of a short-term opportunity. The Australian electorate is a bit more discerning. People have grown up a lot and they have grown up to the Opposition's disadvantage, because they are better educated, they are more aware and they want fairness and equity. But they know that they will not get it out of honourable members opposite. If they want fairness and equity they will get it out of this Government, because it is on the record. Let us continue this theme for a bit longer. The honourable member for Ryan has said that there is a lack of certainty in the business community. Perhaps I am looking at the wrong figures, but I see that the plant and equipment investment projections for 1988 through 1989 show a 10 per cent increase in real terms and this is what businesses themselves have told this Government and they have told the community at large. They have said, `We are going to increase our investment by 10 per cent in real terms'. That is not a business sector which is confused. That is a business sector which says, `This is an economy that is on the move. Australia is back to work and we are going to go places, and we are going to go places because we are going to put plant and equipment investment in place.'. Just to add to that theme, there was the 10 per cent increase in plant and equipment investment in the December quarter of last year and there was a 5 per cent increase on average right throughout the 1987 calendar year. So what we are looking at in 1988-89 is a further increase in plant and equipment investment. I talk to a lot of business people in my home State of Western Australia and they share equally the confidence that we have on this side of the House. They share the confidence because they know some of the tough decisions have been taken. Let us talk about confusion further, because there was a lot of confusion in this debate. Where were members of the Opposition when it came to an exchange rate policy? They could not face it. We recently had some discussion in this chamber about a former Prime Minister and what happened to exchange rates under him. I would only make this observation, that honourable members opposite were never able to make the tough decisions on exchange rates. They were never able to do it. It was beyond them because we did not know whether they were bowing to the Country Party or whether the liberal economic rationalists would carry the day. The consequence of all that was that honourable members opposite, when in government, had a massively protected Australia. They had an overvalued exchange rate and they had a domestic economic structure for whom export was what one did when one had something left over in the factory. Members opposite never had a positive attitude towards export policy. What the Opposition had was a time when exports were those things that manufacturers simply got rid of when they had something left over. Now all that has changed. We floated the dollar in February 1984. We made this economy more competitive and more dynamic. Australia is back to work. When one gets out there one finds that that is the case, but people would not have been back to work under a coalition government because it did not have the policies. It certainly did not have an exchange rate policy. It did not have an industry policy. We found it necessary to put in place the car plan and also the steel industry plan. Why? Because industry was badly structured, uncompetitive, there was not the go-getting attitude that we wanted to ensure was in industry in Australia. It was necessary to put that plan in place, but honourable members opposite had neglected that. So let us not come into this place and talk about confusion and lack of direction. When one looks back on the Fraser-Howard years and one then looks further back to the Menzies years, what one finds is that honourable members opposite were the sorts of people who were looking for the great wave to surf home on. They were lucky some of the time because they got a good wave. They got a good wave in terms of the Bass Strait oil finds and they surfed along on that for a while, but I have bad news for them. There are not those easy rides any more. One has to take the tough rides and honourable members opposite are not equipped to do it. They are not equipped to do it on media policy. I have already said that. The honourable member for Cowan will remind the Opposition of a few of its other deficiencies. Honourable members opposite are not equipped on media policy, but they were not equipped with respect to investment policy either. I found it interesting that the honourable member for Ryan talked about the hit that people have taken in terms of investment. Again let us go back to some figures. In December 1983, in terms of the calculations, the profit share of gross domestic product was 12 per cent. It has gone up to 14.8 per cent in December 1987, according to the calculations that have just been released today. One looks at those figures and one asks, `Is this the same conclusion that the honourable member for Ryan has drawn?'. Clearly it is not. The honourable member for Ryan conveniently wanted to get up a conclusion that business in Australia is confused because of the Government's policies. Business is not confused. The only thing it might be confused about would be where the Opposition stands on media policy or tax policy, but business is not confused about our policies. I will tell honourable members this: there are some people out in the community who are not confused about certain goals, and let us talk about those. The people who have got back to work since we have been in government-there have been one million new jobs created since we have been in government-are not confused because they know now that they have got jobs. But honourable members opposite saw a quarter of a million jobs disappear in their last year of office. The Australian community is not confused about our employment policy. Nor is it confused about our housing policy, because it knows that in terms of delivery of housing services, we have seen 1.4 million Australians back into housing in the five years that we have been in office. That has come about through the first home owner scheme and the Commonwealth-State Housing Agreement, and that is on the board. When members opposite go around their electorates and when we go around our electorates there is one thing that stands out: Australians are getting into houses in a way that they were not under the Opposition when in government. It got the housing starts down to 105,000, the lowest in 20 years. What a disgrace it was when honourable members opposite had people unable to get houses under their Government. We have sought to try to reverse that. We have still got a job to do, but we have reversed that in terms of the direction. There is no doubt, if one talks to people in the Australian community, what is happening about jobs. We have got Australians back to work. What is happening in terms of housing? We have got people with a roof over their heads. They are the sorts of certainties that one can talk to on our side of the House. There is another certainty and that is in terms of industrial disputes. We have reduced the level of industrial disputes. The great Fraser formula was to divide, and when honourable members opposite divided Australia they got people at one another's throats. It does not work in terms of our enlightened Australia. What we are about is trying to ensure that people in the workplace can get on with the job. The measure of that can be shown in industrial disputes. When one talks to people in business and talks to people in industry they say, `We are very happy with the way the industrial climate has developed'. I will tell the House what else they say, which is rather interesting too. They say, `Look, things are difficult. We recognise there is an external account problem, which comes about because of years of neglect, and we realise that not all your policies would please everyone in business, but we hope like hell that you mob stay in office because we are terrified of what would happen if we got the Howard crew in office'. The trouble is that they do not know what policies honourable members opposite stand for. They do not know who is pulling the strings behind the scene and they do not know which particular group honourable members opposite are going to bow to. So when one talks to people out there in business, there is one thing they are very certain about and that is that they do not want the Opposition in government. Certainly when one talks to the general community, it does not want the Opposition in government either, because it knows that honourable members opposite would go back in the same old directions in terms of division, in terms of attacks upon people whom we regard as being important. We know who members opposite would attack. They would attack people on housing. They would attack trade unions. They would attack young people. They would attack minority groups. They would certainly pose a challenge in terms of our policy on multiculturalism-all those sorts of things. We know what would happen. Mr Elliott is on record on a lot of those things. He says, `I am not really sure we should be going for a multicultural Australia'. On this side, we are not for that sort of divisiveness. We believe Australia is a country that is capable of having a variety of people. But if honourable members opposite go back to their policies of high unemployment and high interest rates, then clearly they are going to get division, because if they put people out of work, if they put people out of houses and if they put people in industrial disputes, we are going to get strife. Of course they will. What members of the Opposition have got is a working laboratory model that is called Maggie Thatcher's Britain, and what a model that must provide in relation to ordinary people, where people regularly take to the streets out of frustration. She has the most divided Western economy you could possibly imagine. One thing we are certain about is that those opposite pray at the feet of Maggie Thatcher because they see her as having the sort of answer that they would want, except they are not prepared to face the social realities of the divided society, the bitter society that they would create with those policies. A lot is being said in this debate, but there are some things that we ought to say in conclusion. When those people opposite get up and talk about confusion, the confusion can be demonstrated from their years in office. The confusion can be demonstrated right from today. One has merely got to read today's newspapers. What is happening on media policy? What position should they take? I was here last year when coalition members jumped up and down in the Senate, used their normal negative approach and blocked our 75 per cent rule. They would not want to talk to some of the people in the community to whom I have talked because one of the things about our media policy is that we want to ensure that all Australians have access to the best in terms of television. We have that in terms of policy. Where do honourable members opposite stand in regard to media policy and tax policy? Is it again-and I reiterate this point-the consumption tax that John Elliott wants or the non-consumption tax espoused by the Leader of the Opposition? We are not sure. The Australian community is not sure and people are not about to find out given the sorts of contributions we are hearing at present. Honourable members opposite are patching up the cracks day by day. There is no doubt in our minds. The record shows that we on this side are very clear about our policies. There is no confusion; the confusion lies with the Opposition. We are confident about the direction of our policies and we commend them to the Australian community. Mr NEHL(Cowper)(4.41) —I must say that as always I was interested to hear the comments of the honourable member for Stirling (Mr Ronald Edwards). His delivery is always most urbane, polished and sonorous but, as usual, so much of what he says is wrong, is half true, and is so biased, so prejudiced and so ignores the truth that regrettably I must say his whole contribution was denigrated. The honourable member for Stirling said that the people of Australia have confidence in honourable members on his side of the House. He said just a minute ago, `They say that they hope Labor stays in office'. I ask you, Mr Deputy Speaker, and the honourable member for Stirling: `Where is the confidence in the Australian Labor Party and the Hawke Government as demonstrated in Adelaide, Port Adelaide, at the Victorian by-elections, the Western Australian by-elections, the Brisbane City Council election, the Groom by-election, the Barambah by-election and the New South Wales election? Where was the confidence in the Labor Government demonstrated in those cases?' It was not demonstrated. The people of Australia have had enough. Dissatisfaction is not only the subject of this motion. People in the business community of Australia are confused and puzzled by the vagaries and inconsistency of this Labor Government, as are all the people of Australia. I was fortunate to visit Japan last March as a guest of the Japanese Government and in many discussions with senior Japanese officials the message came over loud and clear that their concern about Australia related to the lack of policy consistency. That is what the people of Australia are worried about as well. We are rather concerned about the statements that were made last weekend by the Minister for Employment and Education Services (Mr Duncan) when he called for higher taxation-for taxation increases. Let us consider the newspaper headlines in recent days. The headline in the Canberra Times stated `Duncan speaks out on economic policy. Tax increase suggested'; in the Sydney Morning Herald, `More tax? PM is not amused'; in the Australian Financial Review, `Duncan in hot water on tax statements'. I will say he is, and he will be in more. The headline in the Age stated `Minister calls for higher taxes'; in the Sun Herald, `Lift tax revenue, says Labor man'. Does not the Government, the Minister or the Labor Party know that all Australians are sick of high taxation? Do they not know that this Government is the highest taxing government that we have ever had? Have they forgotten what the Prime Minister (Mr Hawke) said, as headlined on the front page of the Sun Herald of 24 April-`Lift tax revenue, says Labor man' under which was an article headlined `Promise of ``big'' tax cuts'. That article stated: . . . Australians can look forward to `significant' personal tax cuts over the next two years, Prime Minister Bob Hawke promised yesterday. At the same time, however, Mr Hawke warned that Australia is so heavily in hock to the rest of the world that the task of reforming the economy is far from over. Thus on the one hand the Prime Minister promises huge tax cuts and on the other hand his junior Minister-but he must have some value since he is in the Ministry-says that taxation must be increased. It is interesting to ask at what venue the Minister made that statement. He was speaking at the National Conference of Young Labor. I wonder how many people were there. I bet there were fewer than would have been the case a few years ago, because the young people of Australia are seeing through Labor, as are the people of other generations. The young are seeing through the broken promises and the pious platitudes of the Labor Party. Let us consider one of the Minister's pious platitudes for size. He said in that address: We must show them that we are the party of caring policies, policies developed with ordinary Australians in mind, policies which will help them achieve their aspirations, policies which will lead to a better and more decent society. Help them achieve their aspirations! Just how have ordinary Australians fared under Labor? What has happened to the things that really matter to ordinary Australians? For instance, the honourable member for Stirling referred to housing and home loans. Let us consider the level of home loan repayments. It is always so easy for the Government to hark back to the Fraser years. Honourable members opposite serve up that stale pastry time and time again, but let us consider the level of home loan repayments. In March 1983, when Labor came to power, average monthly loan repayments were $545 or 19.2 per cent of income. In September last year that had increased to $606 or 27.4 per cent of income. The public housing waiting list in December 1982 totalled 110,000, but in December 1986 it was 154,000. How will Labor solve the problems by increasing taxes! What about unemployment? That matters too to ordinary Australians. Honourable members opposite continually talk about new jobs, but they do not talk about unemployment. They are very fond of trotting out the statistics under the previous coalition Government. Let us consider a few relevant statistics, because the coalition-the Liberal Party of Australia and the National Party of Australia-and I are concerned about unemployment. Honourable members opposite boast about the number of jobs, but they never talk about unemployment. Let us compare the figures. The average monthly unemployment level under the Fraser Government was 403,000, and under the Hawke Government it is 619,000-an increase in unemployment under the Hawke Labor Government. The average monthly unemployment rate under the Fraser Government was 6.1 per cent and under the Hawke Government it has increased to 8 per cent. The Minister was speaking at the National Conference of Young Labor. The average monthly youth unemployment level under Hawke is 119,000, but under Fraser it was 115,000. The average monthly youth unemployment rate under the Hawke Government is 20 per cent and under the Fraser Government it was 18.6 per cent. I could go on and refer to the various factors associated with unemployment. The Hawke Labor Government has not reduced unemployment. I would like to consider another statement made by the Minister. He said: I am a democratic socialist. I believe that the people of Australia have a right to share in the wealth that they create. He is right. People do have a right to share in the wealth they create without being ripped off by more and more taxation. I cannot understand how any Minister of a responsible government could possibly, in this day and given the state of the economy, advocate higher taxation. Those ordinary Australians of whom the Minister speaks do not want to pay more taxation. They know that they are being over-taxed right now. They know that the Labor Government is the highest taxing government we have ever had and now the Minister wants to increase taxation even further. Day after day honourable members opposite dish up this stale pastry. Personal income tax is worth considering as well just to get the facts right. In March 1983 the rate of personal income tax for a single income family on average weekly earnings was 17.5 per cent; in November 1987 it was 22.5 per cent. That is the Hawke Labor Government's record. The level of personal income tax per week for the average weekly earner in a single income family has increased from $65 to $117 in that period. That is what the ordinary Australian is faced with, and it demonstrates the impact on the ordinary Australian of the Hawke Government's taxation policy. I will refer very briefly to what happened a little earlier today when I asked the Minister whether he stood by the statements he had made on the weekend. His answer was: I made that speech in a Labor Party forum and the Prime Minister has called for a debate on this matter. I do not intend to pursue the matter in this public forum. The appropriate place to have such a debate is within the Party. The Minister made the claim for increased taxation in a forum that was open to the Press: it was a public forum. Now he does not want to debate the matter, but I can tell you, Mr Deputy Speaker, that the people of Australia will not accept more taxation and the Minister should wake up to the fact that the Government must be prepared to debate the matter in a public forum. It is not good enough for him to say that within the Party is the place to have such a debate. The people of Australia are interested in taxation; they do not want to pay any more tax. They know they are being taxed too heavily and want to pay less tax. Less tax is what we in the coalition will deliver when in government after the next election. Ms JAKOBSEN(Cowan)(4.51) —I was a little disappointed in the speech of the honourable member for Cowper (Mr Nehl), especially when he contributed to the debate by using statistics, which we all know can be made to say anything one wants, and also when he failed to give the Government any credit at all for reducing unemployment. Mr Nehl —You blow your own trumpet all the time. I do not have to do anything about it. Ms JAKOBSEN —Indeed you do. The honourable member should give us credit, especially since his coalition Government made such a mess of the situation before it lost office. Mr Nehl —You always forget the four-year drought. Ms JAKOBSEN —We forget nothing on this side of the House. We do not forget that unemployment has been reduced or that jobs have been increased. We do not forget that interest rates and inflation have been reduced since we came to office. I do not think the Australian people forget these things, either. The Opposition has a vacillating record on many important economic policies and business does not forget that, nor do the Australian people forget it. As the honourable member for Stirling (Mr Ronald Edwards) rightly pointed out, the Opposition was well known, if not infamous, for the tax rorts over which it presided while in office. If it were to return to office, we would have a rerun of the free lunch syndrome. The honourable member for Cowper obviously had no idea of why this matter of public importance was put forward by the coalition, and the honourable member for Ryan (Mr Moore) was even less certain of his subject or the reasons for it. Tax revenue can be lifted without increasing tax rates. I make this point because it seems to be a matter on which the Opposition is basing its argument today in the erroneous assumption that there is somehow some conflict in the Government on this issue. Tax revenue can be lifted by increasing the number of jobs and the number of people in employment. It does not have to be done by increasing tax rates. I was glad that the honourable member for Cowper raised the quality of life issues because I think it is important to say that people in this country are better off under Labor. They are better off because we believe in social justice and in the social wage. Those people who now have jobs who did not have them before are definitely aware of the benefits of our policies as opposed to those terrible policies under which they tried to survive when Fraser was in government and when the Liberal and National parties ruled in this House. Today, we are being asked to discuss a nonsense matter. Once more the Opposition is scraping the bottom of the barrel in its attempt to throw mud at the Government and take the spotlight off its own inadequacies and indecision in important areas of policy. The honourable member for Stirling also mentioned the debacle in the Opposition in the communications policy area. The party of deregulators is unable to tear itself away from regulation and is reduced to carping criticism of a government which has responded imaginatively and without fear to the nation's economic needs on every conceivable front. The business community is very well aware of the economic direction in which the Government is proceeding and approves of it. The President of the National Farmers Federation very recently acknowledged that government policy was heading in the right direction. He even endeavoured to take some credit for that. Does the Opposition seriously think that business has forgotten the reduction in business tax rates or the advantages of imputation? I think not. Business is aware that under this Government's management interest rates have fallen markedly. Inflation has fallen and continues to fall. Wages have been necessarily restrained as a consequence of the devaluation of the dollar. International competitiveness has been restored, thus improving the capacity of business to operate and prosper in conditions which favour innovativeness and expansion. As the honourable member for Stirling said earlier, risk taking was something forgotten on the Australian commercial landscape and business did lack some thrust; but I think it has been restored now because business has an awareness of government policy and a belief in the fact that this Government will provide economic conditions under which business can operate. Furthermore, business is also well aware of the Hawke Labor Government's concern to ensure the maintenance of stable, improving economic conditions in the knowledge of the need for business to plan its operations with an eye to the future. The accord with the trade unions has produced such an environment industrially. There is no way in which the coalition could have produced that environment. Its confrontationist policies ensured that this nation had difficult circumstances for the people employed and the business community. Our monetary and fiscal policy has created a similarly advantageous economic environment since 1983. Five years ago the Government adopted the practice of making a substantive economic statement in May as a preliminary to the August Budget. At that time, and since, the statement was made bearing in mind the need for business to be able to plan its activities on the basis of the conditions presumed to be continuing in the forthcoming financial year. Those members opposite who look at this matter honestly will acknowledge that, as the primary implement of fiscal decision-making, the August Budget was always a fairly clumsy tool and often caused major disruption to the investment planning of business precisely because it occurred after the commencement of the financial year at a time when its planning had been put into practice. At that time business applauded the decision and it has continued to applaud it since. The adoption of the May economic statement as an important preliminary pointer has provided Government with a fine tuning apparatus and provided business with an advance warning on the Government's thinking and direction pre-Budget. It enables sensible, appropriate and reasonably well informed planning by business. For all its claims to be the friends of business, the Opposition never had the gumption or the intelligence to institute such a measure. Hidebound in its conservatism, it continued to lurch from Budget to Budget for all the tedious and backward years that it held government. The hapless business community watched those opposite and their equally colourless predecessors as they presided over huge budget deficits, industrial conflict arising from their confrontationist policies, and unenlightened contractionary economic policies that forced Australia into recession and unemployment, and resulted in a strangulation of consumer spending, with a consequent loss of business profitability. These things need to be remembered. There is no substantial contradiction within the Government on the general thrust of economic policy. The economic ministry is firm on the importance of maintaining a moderate level of growth while sustaining job creation and keeping interest rates within recent parameters, and also reducing inflation as much as possible. The strength of the dollar will always be difficult to predict given a floating exchange rate, but the Government is still determined to make the structural changes necessary for our economy to become more viable and export oriented, particularly exports from the manufacturing sector. That obviously assists employment and benefits the workers of the nation. Given the improvement in the economy, it is, however, appropriate that there will be some debate about the need for the continuation of economic restraint. We are a caring and compassionate government. In this vein the Prime Minister (Mr Hawke) has recently indicated that he would like to be able to improve the lot of middle income families at the earliest opportunity, probably through tax cuts. Other members of the Government are aware of the danger of fuelling domestic demand. Still others believe that the time has come for some such economic stimulus, which in itself can have a positive effect on employment, consumer confidence and business profits. None of this detracts from the authority of the economic Cabinet on matters of economic policy. Current conditions will always have a bearing on our policies. We are not wedded to a particular formula on a specific page of the economic textbook-the Maggie Thatcher model mentioned earlier by the honourable member for Stirling. It is completely vacuous of the Opposition not to recognise the dynamic of the economy and the contradictions inherent within it. Its proposal today suggests that business is homogenous; that it has one voice. It fails to acknowledge that what is good for export firms may not be good for those trading domestically. It does not indicate that the interests of primary industry and manufacturing industry are not necessarily the same; nor does it recognise that the needs of big business and small business differ markedly, as do the requirements of international and domestic capital. I totally reject the words and the sentiment of this matter of public importance, confident in the knowledge that this Government is in tune with the needs of the Australian nation and is taking the economic action which is appropriate to the current circumstances, while refusing to rule out the possibility of easing back on the brake as soon as possible. It must indeed be disappointing for the Opposition to hear business praising the Government for its success in economic policy. Mr DEPUTY SPEAKER(Mr Mountford) —Order! The honourable member's time has expired. The debate is concluded. Mr HAND(Melbourne-Minister for Aboriginal Affairs) —by leave-On 10 December 1987, in a statement to this House on a report entitled Foundations for the Future, I outlined the Government's proposals to establish the Aboriginal and Torres Strait Islander Commission (ATSIC). These proposals derived from the commitment by the Prime Minister (Mr Hawke) to bring the various elements of the Aboriginal Affairs portfolio into one statutory commission `so that there will be an absolutely firm legislative basis for expressing the total commitment of the Commonwealth and the people of Australia to the Aboriginal people'. In my statement of 10 December, I stressed that the ATSIC proposal would not go ahead if it did not receive a positive endorsement from the Aboriginal and Islander community. In making this commitment it must be remembered that the Government could have made the necessary changes to the Aboriginal Affairs portfolio without getting involved in this comprehensive process of consultation. As Minister, I could have done this while sitting at my desk in Canberra. Instead, I undertook to consult personally with the Aboriginal and Torres Strait Islander people prior to proceeding with the proposals. Between 23 January and 10 March this year, the Secretary to my Department, Mr Charles Perkins, and I attended 46 meetings throughout Australia involving an estimated 6,000 representatives of some 1,200 Aboriginal and Torres Strait Islander organisations and groups. These meetings were preceded by 450 community meetings in 415 locations to ensure that preliminary matters were worked through prior to my visits. Far from being a `whistle-stop tour', as some have suggested, the ATSIC consultations are the most wide-reaching ever undertaken by a Minister in this portfolio. Throughout these consultations I stressed at every meeting that the proposed commission would not go ahead if Aboriginal and Islander people did not want it. I also made it clear that the proposal could be changed if need be. There were a few who doubted my word on this point. Some said the Government had made up its mind and the community meetings amounted to `token consultations' only. Allow me to explain what has happened as a result of those community meetings. Following the first round of consultations it became evident that there were a number of widely shared concerns regarding aspects of the Government's proposals, but that there was overwhelming support for the basic principles outlined in the Foundations for the Future booklet. Accordingly, a further document was prepared setting out a range of alternative options to those aspects which were of concern. This document was also widely circulated, and was the basis of the second stage of the consultation process. This second stage amounted to a series of follow-up meetings convened by departmental officers and Aboriginal liaison officers in all States, the Australian Capital Territory and the Northern Territory. As a result, and in keeping with the commitment this Government has given to consultation, it is now proposed to vary the Foundations for the Future proposals in a number of significant areas. Firstly, let me deal with the key area of regional councils. Virtually all consultation meetings called for an increase in the 28 regions originally proposed, mainly on the basis that those regions were too large. It is now proposed that there be about 56 regional council areas, subject to the finalisation of boundaries. These amended boundaries reflect Aboriginal and Torres Strait Islander requests and recognise historical, cultural, linguistic and other important factors. Instead of regional councils comprising one representative from every Aboriginal or Torres Strait Islander community and organisation within their regional area, it is now proposed that regional councils consist of 20 members, elected under a `one person, one vote' system. This overcomes concerns about inequities in representation. Regional councils will meet up to four times a year. I now turn to the proposal to establish zone councils. Many consultation meetings expressed a view that a separate council at the zone level was unnecessary and could interfere in the relationship between regional councils and the Commission. It is therefore proposed that the planned zone councils be abandoned. In the absence of zone councils, a postal ballot of regional councillors in a particular zone will be held to elect commissioners. A section of the Foundations for the Future proposal which created much discussion was the question of commissioners. It was originally proposed that the Commission consist of 12 members, those members being an appointed full-time chairperson and 11 part-time commissioners-seven to be elected and four to be appointed by the Minister. There has since been a call for additional commissioners, especially in the larger States and those with large Aboriginal and Torres Strait Islander populations, and for a greater proportion of elected commissioners. It is also accepted by the Government that the unique circumstances of central Australia require there to be a special zone, and therefore an elected commissioner, for that area. The Government now proposes a 15 member commission, with an appointed full-time chairperson and 14 part-time commissioners. The chairperson and two commissioners will be appointed by the Minister. Twelve commissioners will be elected: Western Australia, New South Wales and Queensland would each have two commissioners; there would a commissioner for a new central Australian zone covering parts of Western Aus- tralia, South Australia and the Northern Territory; the remainder of South Australia and the Northern Territory and Victoria and Tasmania would each have one commissioner; and a Torres Strait Islander commissioner would be elected by the Torres Strait Regional Council. Under these changes the fears people had that the Government-nominated commissioner would dominate the elected commissioners have now been eliminated. Mr Deputy Speaker, members of the House will recall that I visited the Torres Strait Islands twice during January and February. I now inform the House of details of the proposal agreed to at the second meeting held on Thursday Island. The interests of resident Torres Strait Islanders will be represented by the Torres Strait Islander commissioner, who will be elected by the Torres Strait Regional Council. There will also be an Office of Torres Strait Islander Affairs created within ATSIC, to ensure that the Commission and other Government programs adequately address the needs of Torres Strait Islanders, including those living on the mainland. The office will provide a secretariat to a Torres Strait Islander advisory board, consisting of six part-time appointed members plus the elected part-time Torres Strait Islander commissioner, who will chair the board. According to 1986 census figures, more than three-quarters of the Torres Strait Islander population live on mainland Australia, rather than in Torres Strait. There is a clear need to ensure that the interests of both groups are not overwhelmed by the interests of the much larger Aboriginal population, and that both Islander residents and mainland Torres Strait Islanders do not feel that their interests are ignored. I believe the above proposal, plus the inclusion in the legislation of a provision ensuring that the Torres Strait Regional Council has direct access within the Budget process to the Minister, will satisfy Torres Strait Islander concerns and ensure that many of the complaints about their past treatment will be overcome. The issues that were raised during my first visit will be dealt with in this place at another time. An area that was initially the subject of some confusion and misunderstanding concerned the powers of the Minister. There will be two categories of Commission functions: Firstly, those functions on which the Minister can make specific directions, and secondly, those functions on which the Commission will make final decisions and about which the Minister may only make a general direction. This latter category is consistent with the degree of ministerial powers which currently apply to the Aboriginal Development Commission (ADC). It is now proposed to add land acquisition to this second category of functions, which will mean that ATSIC will have autonomous responsibility for all the powers and functions currently held by the ADC, plus those additional functions set out in the Foundations for the Future statement. Another issue which received some attention by Aboriginal groups during my consultations was that of the preamble. I am bound to say that the Government remains committed to a preamble which does no more than recite the facts which have led to the Aboriginal and Torres Strait Islander people of this nation being the most disadvantaged socio-economic group within the Australian community. More importantly, the Government in no way resiles from its decision to recognise the fact of prior occupation and original ownership of the descendants of the people now known as the Aboriginal and Torres Strait Islander people. There have, however, been some reservations voiced by Aboriginal people in relation to certain parts of the preamble. These reservations centre more on the way in which those facts have been expressed rather than with the facts themselves. As a consequence the Government is prepared to give further consideration to the wording of the preamble in its drafting of the legislation. I would now like to make some clarifying points regarding the establishment of the Aboriginal Economic Development Corporation (AEDC). Honourable members would be aware that the AEDC is a commercial corporation charged with building a significant capital base for Aboriginal and Torres Strait Islander people. There has been some confusion relating to the dividend arrangements which will apply in respect of the AEDC. The legislation will provide for the Corporation to recommend an annual dividend to the Minister, who will accept or vary that recommendation after consultation with the Treasurer. The maximum dividend payable will be 50 per cent of net profits and there will be a dividend moratorium for the first three financial years of operation of the Corporation. The dividend provisions apply because the Corporation is essentially a commercial entity; they are consistent with the Government's policy guidelines on government business enterprises. The AEDC will be subject to normal corporate taxation requirements. In relation to the Australian Institute of Aboriginal Studies I am continuing to consider a number of relatively minor adjustments to its operation. Final decisions have not been taken. In the light of these changes to the Foundations proposals, the essential features of the proposed Aboriginal and Torres Strait Islander Commission can now be summarised in the following terms: the amalgamation at regional, State and central office levels of the two major Aboriginal Affairs portfolio bodies: the Department of Aboriginal Affairs and the Aboriginal Development Commission. Subsidiary bodies of the Commission will include Aboriginal Hostels Ltd and the Australian Institute of Aboriginal Studies. the establishment of an all Aboriginal and Torres Strait Islander Commission, the overwhelming majority of whom are elected, with executive responsibilities across the whole spectrum of Aboriginal and Torres Strait Islander affairs. the establishment of around 56 incorporated regional councils throughout Australia, with statutory responsibility for setting priorities for ATSIC expenditure within their regions. the establishment of a new Aboriginal Economic Development Corporation in addition to programs funded by existing enterprise loans and grants. specific attention to the interests of Torres Strait Islanders-both in the Torres Strait and on the mainland-through the provision of their own elected commissioner, the creation of a Torres Strait Islander Advisory Board, and the establishment of an office of Torres Strait Islander Affairs within ATSIC. In a very real sense, these changes represent a complete overhaul of the existing relationship between the Federal Government and Aboriginal and Torres Strait Islander people. No longer will they be held at arm's length from government under the guise of `advisory' bodies and the like. No longer will the Aboriginal and Torres Strait Islander people be excluded from the executive decision-making processes of government. No longer will the priorities for expenditure be determined by appointed commissioners or bureaucrats in Canberra without reference to the views of Aboriginal and Islander communities, be they in the bush, or more isolated regions of Australia, our rural towns, or our State capitals. It is precisely because these changes to the structure of the Aboriginal portfolio are far-reaching, that I have been at pains to involve all Aboriginal communities and organisations in developing them. Their participation was crucial in making these changes. Many of the key concepts in the original Foundations statement can be traced to the Coombs and O'Donoghue reports, both of which were based on direct consultations with Aboriginal and Torres Strait Islander people. I repeat, my own consultations involved the most sustained and extensive round of meetings with the Aboriginal and Islander community ever undertaken personally by a Government Minister. The process as a whole far exceeds all the consultations ever undertaken in respect of any previous Federal or State legislation dealing with matters affecting Aboriginal people. This is how things should be. This is how I will continue to approach matters with such far-reaching and sensitive implications. One matter consistently raised by Aboriginal and Islander people has been the announced commencement date of 1 July 1988. I inform the House that the establishment of the Commission will be 1 January 1989. This will allow legislation to be drafted, enable me further consultation on specific details which may arise during the drafting process and ensure that the necessary time required to conduct the elections will be available. The Bill will be introduced early in the Budget sittings. To enable the Commission to commence operations on 1 January, it will be necessary to hold elections for regional councillors, and subsequently, for commissioners before the end of this year. It is proposed these elections, which will be supervised by the Australian Electoral Commission, be held in October, November and December. In conclusion, I wish to thank the many Aboriginal and Islander communities for their willingness to consider and debate these issues, and for the welcome and hospitality afforded me everywhere I travelled. I would also make the point that the consultations gave me an opportunity to hear first hand the communities' views on a range of other issues. This is something that cannot be done behind a desk in a capital city. This was an additional advantage of the meetings. Other people I would like to thank include the Secretary to my Department, Charles Perkins, for his loyal and sustained support during this arduous process; Lois O'Donoghue, chairperson of Aboriginal Hostels Ltd for her general support and assistance at meetings; and Department of Aboriginal Affairs officers at central, State and regional level for their excellent work throughout the consultations. They travelled long distances and put in many hours. I applaud their efforts. I also thank the members of the ATSIC task force for their important contribution to the process, my own staff for their dedicated and unflagging support and the parliamentary members of my own Party who assisted in the consultation process. As I pointed out in my previous statement to this House, these proposals lay the foundation upon which real progress and achievement for Australia's Aboriginal and Torres Strait Islander people can be built. Aboriginal people, by their responses to the Government's proposals, have demonstrated their willingness to build on these foundations. It is now the Parliament's turn, as the representative of the Australian people, to face the challenge and indicate its willingness to meet Aboriginal and Torres Strait Islander people half way. Mr MILES(Braddon) —by leave-As the Minister for Aboriginal Affairs (Mr Hand) has said, this is an important issue for the Parliament to consider because we are dealing with the administrative arrangements for handling the Aboriginal affairs area within Australia. We have had a look at the statement which the Minister has put down today. I thank him for making it available a couple of hours before he came into this House. There are a few things which we certainly welcome about the statement. We note that many of the things which he talked about four or five months ago in the booklet entitled Foundations for the Future, which was brought into the Parliament, have now been accepted. I recognise that a lot of that has come through consultation with the Aboriginal community. There has been a lot of discussions in redrawing the boundaries amongst Aboriginal people. We welcome the redrawing of the boundaries and will have a look at that area of the proposal. The essence of this statement today is that the Government has decided to delay bringing in the Aboriginal and Torres Strait Islander Commission proposal. Again, I make the point that the Minister did say last year that he would consult as long as it was necessary. We note that consultation has taken place. Even though the figures look impressive in regard to consultation, we also need to be aware of just what it means to move into an Aboriginal community and spend three hours there with a new proposal. Many Aboriginal people really did not have any idea about it until the Minister went into those communities. Mr Hand —That is not true and you know it. Mr MILES —The Minister says that it is not true. Mr Hand —You know it is not true. Mr MILES —Well, they had a look at the video and discussions were-- Mr Hand —There were two-day meetings prior to my arrival and I was at most meetings a lot longer than three hours. Whoever advises you is telling you lies, as has been the case all the way through. Mr MILES —I do not accept that. Even if the meetings lasted for a day, as even the Minister has acknowledged, it would nevertheless be very difficult for people, whether they be Aboriginal people or other Australians, to comprehend the changes that the Minister has been proposing. They are large changes, we all recognise that. Even though a lot of travel has certainly been undertaken by the Minister-we acknowledge that he has done a positive job in getting around the country and talking to the Aboriginal communities-it must be recognised that even if those consultation processes took up to a day in each of the regions, that was still a very short period for people to comprehend these changes. In regard to the proposed delay of six months, I put it to the Government that this will really be a delay in the consultation process of only about three months. The legislation will have to be drawn up very soon and that does not allow for a lot of discussion in the Aboriginal communities of these new ideas. I believe that another three to six months should have been set aside for consultation to allow the Aboriginal elders in the communities to talk more about this issue. I also believe that sufficient time has not been allowed for consideration of the proposal which has been put up for the Aboriginal Development Commission (ADC). The issues which have been raised in the Minister's statement today indicate that there will be a very narrow focus in the next six months on future consultation. The consultation provision could have remained a little broader-another three months or so. The second question which the putting off of the commencement date raises is whether the Government's judgments in the area of Aboriginal affairs are to be accepted as good judgments. When we look at the record we find that the Prime Minister (Mr Hawke) said in September last year that we would have some sort of understanding or treaty by the end of 1987. That has now been taken off the agenda, at least until 1989. I also note in regard to the treaty that, even though consultations have been undertaken, there has been no statement about that by the Minister today. Mr Hand —I will make another one when I am ready. Mr MILES —I am sure the Minister will. We find also that the reporting date for the Muirhead Royal Commission on Aboriginal Deaths in Custody, whose establishment we supported, has been put back by another year. We find also that the date on which the Government will bring the Aboriginal and Torres Strait Islander Commission (ATSIC) into operation has been put back for six months. I mention the problem concerning the preamble, which we have pursued in the Parliament, particularly in Question Time. We have suggested that the Government seek a legal opinion about the preamble and let all Australian people know what the feeling is in regard to the preamble that has been put forward. In this regard I am reminded of the situation which has arisen in New Zealand where, as a result of one piece of Government legislation in particular in regard to state incorporations, the Treaty of Waitangi is a living document. The New Zealand Government is now faced with a situation which it did not foresee and did not predict-and neither did the Opposition. My plea is that we make sure that we know the implications of the preamble as proposed for ATSIC. Mr Hand —I am going to New Zealand on Friday. I will tell you when I get back. Mr MILES —I went to New Zealand earlier in the year and we discussed that matter then. I think the point has been made that we are looking for a clear indication of the implications of this proposal. In regard to the new Commission, we repeat that we do not believe that a new commission, the new broom approach-the starting up again syndrome, as Senator Chaney has referred to it-is necessarily the best way of improving the delivery of services to the Aboriginal people. I believe that this situation arose not because of the Minister's position or his belief but because the Prime Minister decided shortly after the last election that there would be a new commission. It was all part of his strategy to handle the Aboriginal affairs area. I believe that the Minister was handed the task of setting up a new commission and has had to make the best of a bad situation. In this regard I think that, as a general principle, it is much better to refine the structures which we have in government unless they are absolutely chaotic and a totally new approach is necessary. I do not believe that that is the case in this area. Therefore, we are still unconvinced by the Government's proposition that a new commission in the form proposed is the best way to go. I point out that this is the only area in which the Government is wrapping together welfare and enterprise in the delivery of systems. We do not have that in other areas of Australian government administration. I believe that that will create lots of problems for us down the track. Members of the Aboriginal community-- Mr Hand —`We will look after the welfare but don't let them near the enterprises' is what you are saying. You do not want Aboriginal people to have power over enterprises. Mr MILES —No; I am certainly not saying that. We believe that the Aboriginal people should move towards self-management, self-sufficiency and control over enterprise. Mr Hand —That is what it does. Mr MILES —We do not agree that it necessarily does that. Mr Hand —It does; I am trying to educate you. Mr MILES —I thank the Minister. We believe that the welfare and enterprise arrangement is a problem in this new structure. Also, we do not believe that the Institute of Aboriginal Studies ought to be brought under this umbrella. I believe that it is valuable for our community to have an independent body. This independent body has been set up since 1964, and we believe that it is much more effective in operating at arm's length from the Department or from any new commission. I believe that it is far better for that body, as a repository for information, in collecting and putting down data and information about the Aboriginal people-films, cataloguing and so on-to be removed from the political process. I believe that under the proposed mechanism the established capital base of the ADC is basically destroyed. I do not believe that the new Aboriginal Economic Development Commission will have any greater capacity to deliver enterprise than has the present ADC. I do not believe that the new Commission will be able to go out into the market and raise capital any more effectively. Of course, time will tell in regard to that matter. I hope that, if this legislation comes into being and the Commission is set up, the enterprise side will be a major positive. I do not believe that that is the case at the moment. The proposal as we see it in this statement today leaves many things still to be sorted out in this area. We support the changes the Minister has outlined to us but we believe that there is a need for more consultation, that there is a need for a separation of the welfare and enterprise of the delivery of those services. We believe that the Institute should remain separate, that the ADC in its present form may need some modification, but essentially it is a structure which we believe would be able to meet the needs of enterprise in the future. Mr HOLLIS(Throsby) —On behalf of the Parliamentary Standing Committee on Public Works I present the sixth report of the Committee for 1988, relating to the construction of radio and orchestra facilities for the Australian Broadcasting Corporation (ABC) and the Special Broadcasting Service (SBS) at Ultimo, New South Wales. Ordered that the report be printed. Mr HOLLIS —by leave-The report I have just tabled relates to the approval by the Committee of the construction of radio and orchestra facilities for the ABC and SBS at Ultimo, New South Wales. The Committee has concluded that the project will lead to a more efficient use of resources resulting in economies which it is expected will substantially pay for the new complex. The project will be funded on an instalment purchase basis and not from the Budget. The ABC advised the Committee that savings of $10.2m per annum are expected as a result of the collocation of ABC radio and SBS radio and these will be offset against the cost of the project. The Committee has noted the concern of the ABC staff union regarding the achievement of the project cost savings and the Committee recognises that the realisation of the potential savings will depend greatly on co-operation between management, staff and their unions. The Committee has also drawn attention to the failure of the consultation process between ABC and the ABC staff union and believes that meaningful consultation must take place if this project is to succeed. It was suggested to the Committee that the project should not proceed during the current review of national broadcasting policy. This matter was given serious consideration by the Committee but it has accepted advice from the ABC that the design of the complex is sufficiently flexible to accommodate modifications should these be necessary. In conclusion, on behalf of the Committee I should like to congratulate the ABC Board for responding to the needs of staff by agreeing to provide child care facilities in the Ultimo project. These facilities will replace existing child care facilities sponsored by the ABC staff union. Debate resumed. Mr LINDSAY(Herbert)(5.34) —Not long after I was elected in March 1983 a delegation of service personnel within my electorate discussed with me generally the overall morale of the defence forces in Townsville and the general condition of the defence forces as a long term career. They recounted their despair that under the previous Government the Public Service and the general community-even the Government-did not seem to care sufficiently about their problems. They evinced a general feeling that these groups were incapable of remedying a situation that had been allowed to deteriorate for years. In September 1985 there was a meeting at the new Townsville Commonwealth Centre between a group of Defence Force spouses and the new Minister for Defence (Mr Beazley). The defence spouses at that meeting placed before the Minister their concerns as to their role as spouses of serving personnel. Their concerns included pay and allowances, housing, the unreasonably long working hours of their spouses, their children's future and education and, ultimately, the long term career prospects of their spouses. The Minister for Defence listened to what they had to say and in November of that year, 1985, he commissioned Mrs Sue Hamilton to prepare a report identifying the problems faced by families of people in the Australian Defence Force. He recognised that there was a serious problem for defence spouses in conditions generally within the Australian Defence Force. He recognised that there had been tremendous social change over the previous 15 years within Australian society. He recognised that today's family demanded an improved standard of living, that quality of life was important, that there had to be commensurate expectations within the Defence Force community as there were in the civilian community. Mrs Hamilton visited a large number of defence bases around Australia and spoke to approximately 4,500 spouses of personnel in the three Services. On 30 April 1986 her report entitled Supporting Service Families was released. It covered a number of matters, as have been outlined by the Minister for Defence Science and Personnel (Mrs Kelly) in this House this afternoon. One of the main problems identified in Mrs Hamilton's report was the widespread dissatisfaction with the standard of service housing. She heard many complaints from service families about housing and visited a number of defence married quarters. From her conversations and her observations she was persuaded not only that the complaints were entirely reasonable but also that the low standard of service housing was a significant contributor to poor family morale in the Services. Indeed, the most frequent area of complaint during her visit to service establishments around this country was the poor standard of maintenance of service housing. Service tenants complained of delays in carrying out maintenance and poor quality of work and materials when maintenance was done, resulting in rapid deterioration. So she made a recommendation in her report that this was a critical priority area requiring urgent attention by the Government. The whole issue of defence service housing has been debated in this chamber over a number of years. Indeed, the Monaghan Task Force on Australian Public Service and Defence Housing Programs interim report, which was debated in this Parliament many years ago, recommended payment of an explicit subsidy and the abandoning of the long term practice of housing for personnel being established reasonably proximate to their base or establishment. I believe that the general consensus of all members of this House is that housing is and should always be regarded as a strict condition of service and that rent arrangements pertaining to defence housing must be preserved, protected and defended. The establishment by the Hawke Government of the Defence Housing Authority represented a milestone in the direction of improving conditions for service personnel. The Housing Authority quickly publicised the fact that almost half of the stock of defence service housing in this country, that is, approximately 12,000 houses occupied by service personnel and their families, was below standard. As Mrs Hamilton was able to ascertain, this was a major contributing factor to the poor morale in the Australian Defence Force. The condition and quality of defence service housing at Townsville, the home of the Third Brigade and the Royal Australian Air Force base at Garbutt, present a totally different picture. The average standard of defence housing in Townsville compares more than favourably with defence housing in other areas around this country. More than 1,800 service homes are located in the Townsville and Thuringowa region. Over the last two years approximately $1m has been spent on maintenance programs and important repairs to existing housing stock of approximately 90 homes. These works include enclosing and paving under houses, refurbishing kitchens and bathrooms, fitting exhaust fans and ceiling fans and fitting security doors, deadlocks and window security screens. Furthermore, 15 new homes are about to be constructed in Townsville for service personnel, costing about $1.4m. More than 65 homes are to be purchased and built in the Townsville region to satisfy the requirements of the personnel who will make up the Fifth Aviation Regiment, `A' Squadron, to operate the Black Hawk helicopters, which are to be located in Townsville. When I was elected there was a tremendous backlog of complaints about housing in my electorate. You, Mr Deputy Speaker, will recall that the Hamilton report was initiated by Townsville-based spouses of service personnel at a meeting in September 1985 at the Townsville Commonwealth Centre. A lot has been done in the Townsville region to upgrade existing housing stock and to ensure that new housing stock meets the expectations of Defence Force families for comfort, security and maintenance, which they are entitled to as a condition of service. But if the housing problem is being solved by this Government, many other areas are also being addressed by the Minister for Defence Science and Personnel at a rate unmatched in the history of this country. Her performance certainly cannot be compared with the lack of performance by the Fraser Government when the backlog of these issues accumulated, resulting in frustration and despair for service personnel and their families. In 1986 I had discussions with Mr Des Tracy, the then Principal of the Vincent State Primary School in Townsville, concerning a specific issue that confronted defence families-the problem being encountered by children in gaining a fundamental understanding of reading, writing and arithmetic because of the frequent transfers from school to school as a result of parents' postings. Mr Des Tracy and his support staff at the Vincent State Primary School developed a program called `Basic Learning in Primary Schools', which was designed to provide an intensified course to uplift the reading, writing and arithmetic skills of primary school children to enable them to cope with the established school curriculum. Service personnel owe a tremendous debt to Mr Des Tracy, the former Principal of the Vincent State Primary School in Townsville, for his wonderful, imaginative initiative in assisting the education of children who had suffered as a result of frequent postings of their father or mother, as the case may be. In Townsville we have also established a regional educational liaison officer who provides professional advice and assistance to service families, monitoring their education needs and representing them before the State Government, in particular, the Queensland Department of Education. We have also established at the Heatley State High School and the Vincent State Primary School a pilot scheme which introduces a student portfolio into those schools containing examples of a student's work and interests. When the child has to leave the school because of the posting of the child's parent he is able to take away with him a portfolio as to his performance and the subjects he has attempted. This is a major initiative that has been welcomed by service personnel in Townsville. Child-care facilities have been established for defence personnel in my electorate. They are a tremendous facility for the families of service personnel there. I pay tribute to the work of Mrs Jan Ramsdale, who played a major role in campaigning for the provision of child-care facilities at Vincent in the Townsville region and in their establishment. The Australian Defence Families Information Liaison Service has now been put in place. It assists service families in settling into new areas, finds employment for spouses and liaises with local education services. The former Commander of the District Support Group at Lavarack Barracks, Colonel Peter Desmond, has established, with the help of a number of people, a program called `Leisureama', which introduces newly arrived personnel to civilian facilities-sporting clubs and so on-in the Townsville area so that they have an opportunity to integrate quickly into the civilian community. The Government, in particular the Minister for Defence Science and Personnel, should be congratulated on the excellent work done to date in the campaign to implement as quickly as possible the recommendations of the Hamilton report. I know that members on both sides of the House will continue to campaign to ensure that the interests of defence service personnel around this country are at least maintained to a level commensurate with the civilian community. Mr DEPUTY SPEAKER(Hon. J. D. M. Dobie) —Order! The honourable member's time has expired. Mr HALVERSON(Casey)(5.50) —I want to mention initially the contribution of the honourable member for Herbert (Mr Lindsay). I recognise his longstanding, deep and sincere interest in defence. Whilst I recognise that sincere interest, I cannot endorse many of the comments he has made because he is trying to endorse Government policies which are essentially corrupt, inadequate and lacking certainly in a great deal of perception. I will go a little further on these points. I am thankful for the opportunity to endorse the comments made earlier this afternoon by the honourable member for McPherson (Mr White), a former officer with a distinguished service career in our armed forces. We certainly look forward to the contributions of the new honourable member for Groom (Mr Taylor), also a former distinguished member of Australia's armed forces. It is a pity that he cannot be a part of this significant debate today. From my own point of view, I am a former senior Royal Australian Air Force officer, having joined the RAAF in 1956 as an airman, so I have some understanding of the problems that confront our armed forces personnel today. In the slightly more than 25 years I served in the armed forces, and having been married for almost all of that time, my family suffered, probably typically, the challenges that many service men and women confront today. Two of my children were born in Melbourne and two in the Northern Territory. As far as I can recall, we changed our residential address-I have been trying to work it out precisely today-about 23 times in 25 years. My children went to 11 different schools in three different countries. While I am on the topic of children, any service father or mother would appreciate that, when children are moved under the auspices of the defence organisation, bright children seem to mature and broaden their horizons appreciably and respectably and can compete with all the other school children with whom they spend their time, but for average children-and I had two-it is an interminable struggle. For below average children-and I had one-especially where remedial tuition is involved, it is a challenge indeed and one that invariably affects them substantially. It is a blight on their potential working lives. In the 25 1/2 years that I spent in the Services I served in almost all the mainland States, the United States and the United Kingdom. As a formerly dedicated serviceman I am appalled that since this Government came to power in 1983 we have seen the largest exodus of devoted and sincere people from the armed forces ever in peace time. Total separations over that period stand at approximately 41,800 personnel of all ranks, to February 1988. What a disgraceful record this Government has in personnel management. All we have heard today are platitudes-what the Government may be going to do. Members of the Government talk about our leader and harp on the things he has tried to achieve in the time he has been in the Parliament and especially while he has been our Leader. All the Minister for Defence (Mr Beazley) and the Minister for Defence Science and Personnel (Mrs Kelly) can look at today is a weary record of non-achievement-promises with very little effect. The effect of their policies is something that I want to address while on the topic of the 41,800 personnel who have left the Services over recent years. In 1983, 6,485 personnel separated from the armed forces; in 1984 the figure was 7,451; in 1985, 7,709; in 1986, 9,015; and in 1987, 9,113. The figure for January 1988 is 1,209 and, for February, 836. What an appalling indictment of this Government. If this trend continues, and allowing for the fact that the January separations are generally the highest for each year, we could be looking at a wastage rate for 1988 of over 14.5 per cent of the total manpower of our forces. Last year the average wastage rate was an unacceptable 12.6 per cent which, when one compares it with the rate we are likely to achieve in 1988, is almost acceptable. Since 1985 over 27,000 personnel have left the Services, which represents 30 per cent of the 70,000 armed forces personnel, or over 43 per cent of the trained personnel base of 62,000 people. So the sorry record continues. In the Army since 1985 we have had a turnover of approximately 10,000 soldiers and 1,200 officers from an overall authorised strength of about 32,000 people. This is equivalent to about 35 per cent of the total strength. There are 258 officer positions vacant at the moment and this appears to be growing at the rate of about 60 year. In the Navy in the first nine months of this financial year there have been about 155 notifications given by people planning to separate at the rank of commander and below, and they have been given against the backdrop of a 10-year average of about 98 for the equivalent nine-month period. Thirty seamen commanders have left the Navy since 1987, compared with the long term yearly average of seven. Among these commanders, as previously mentioned in the debate, were five who were either currently serving ship commanders or who had recently served in major command and control positions. This is particularly relevant when we only have about seven ships that currently attract commanders of that rank. We have seen today the Minister for Defence Science and Personnel trying to get into the bribery game. The Air Force has suffered even more than the other services in many respects, particularly in that ever-important arena of pilots. The RAAF this financial year is expected to lose not less than 130 pilots. This compares with the 20-year average of just 47. Let us look at some of the figures. In the financial year 1985-86 the wastage rate was 70. In 1986-87, the wastage rate increased to 107. In just six months of the financial year 1987-88, 117 resignations were tendered compared with a six-monthly 20-year average of just 23. In the worst set of circumstances, we could see the RAAF lose upwards of 300 pilots this year, which is an appalling and totally unacceptable rate. There have been allusions to the situation in 75 Squadron-the only squadron we have defending the north. There are only seven pilots for 20 aircraft, and yet we hear the Minister summarily trying to explain that away by saying that the FA18 re-equipment program is going on. Where are our reserves of pilots to cope with the normally routine challenge in the armed forces of training other pilots to take over as these new aircraft are introduced? Should the current trend continue, pilot wastage this year could be about five times the ability of the Australian defence forces to replace the loss, as the RAAF's capacity to train pilots is limited to approximately 70 pilots a year. This is especially so when one realises that fewer than that number graduate, given the extraordinarily high standards set for Air Force pilots. There are generally heavy losses occurring amongst other specialist Defence Force personnel areas. We are losing engineers, project personnel, communications specialists and computer experts, amongst a very wide array of people whom we can literally not afford to lose. Mr White —Are they going to get a bonus? Mr HALVERSON —Given this Government's initiative, a bonus of any sort is entirely likely. There is a new trend for officers to resign mid-career, thus leaving the pool of higher people capable of reaching the highest level of command in the Services depleted. One must really begin to wonder whether it is the best who leave first. I turn now to the Hamilton report on Supporting Service Families. It is probably appropriate to recall quickly what the original terms of reference were. The terms of reference for the study given to Mrs Sue Hamilton were: 1. To conduct a study into the main problems facing spouses of service personnel, taking cognizance of: a. the diminution of normal community lifestyle choices resulting from the exigencies of service life, and b. community attitudes towards service spouses and families. 2. The study should include, but should not necessarily be limited to: a. identifying employment difficulties facing service spouses and recommending any practical steps that can be taken to improve employment opportunities in public service and private employment; b. identifying any adverse effects of existing posting and promotion policies on family life and, having regard to service requirements, recommending practical solutions; and c. identifying deficiencies in living conditions and support facilities for spouses at service bases and recommending practical solutions and priorities for action. 3. On completion the study is to be forwarded to the Minister for Defence. It is interesting to note that the Hamilton report was first announced in December 1985. The Minister for Defence announced that Mrs Sue Hamilton would identify the main problems facing service spouses caused by the special circumstances of service life. In April 1986 the Hamilton report and its recommendations were published. The report is therefore now two years old. What an indictment of a Government constantly claiming, in its smart alec ways, that it is responsive to the needs of the people of this nation-a caring, benevolent Government. What utter rubbish! In June 1986 the report was accepted by the Minister and the Chiefs of Staff Committee. The implementation team was established to assist the Deputy Secretary A in the Department of Defence and the Assistant Chief of the Defence Force (Policy) to implement the report. Looking briefly at the 15 substantial recommendations, we can look at the directive at ministerial level that the issue of family morale in the Australian Defence Force is one of high priority. After many years of service one does not get a ministerial directive to increase or raise morale. Morale is a function of leadership and the work ethic. It is not something that one dreams up and issues a directive on. Unless there is proper organisation order, combined with adequate and appropriate leadership, morale will continue to stay in the pits and that is, unfortunately, where it remains today. We heard the Minister for Defence Science and Personnel today talk in terms of back-to-back postings and staying in one geographical area for something of the order of three years and possibly six years. Given the rate of exodus from the armed forces at the moment, one cannot believe that three-year postings-let alone six-year postings-are within the province of our expectations. It is much more likely that many of these very well and highly trained personnel we have will move at much more frequent intervals in order to make up deficiencies in other areas. We have heard about the Australian Defence Families Information and Liaison Staff (ADFILS) scheme. I have looked through many of the implementation arrangements that are being made at the moment, and I am appalled at the arrangements that indicate to me increasing bureaucracy in a monolithic Department of Defence and some of the major headquarters areas that exist around Australia-a bureaucracy which is already constraining and curtailing the operational efficiency of the armed forces where, in the major headquarters around Australia and particularly on Russell Hill in Canberra, there are far too many bureaucrats pushing too many pens across too many desks and achieving too little. In conclusion, despite the Minister's glib assurances that everything is under control, it is obvious that the general situation in respect of management of the armed forces still poses significant problems and there is little indication or prospect that the position will be rectified in the near future. There is nothing new offered to disenchanted and disillusioned service men and women in the Minister's statement this afternoon. They have heard it all before. They are aware of the promises and have not been persuaded by them. The Minister refers to the promises and achievements. How absurd! But a promise is not an achievement until it has been fulfilled and the Australian Defence Force personnel are very well aware of this fact and are unlikely to forget it. Mr TICKNER(Hughes)(6.05) —There were going to be, I understand, two speakers from both sides in this debate. We did have on our side an impromptu contribution from the honourable member for Herbert (Mr Lindsay), for which we thank him. The Opposition has graciously agreed that I also speak, having been intended to be the second speaker for the Government, and I understand that that may, in part at least, be due to the goodwill shown by the Government in facilitating the earlier speech by the honourable member for Ryan (Mr Moore). I thank the Opposition for its sanction. Mr White —Now say something sensible. Mr TICKNER —I thank the honourable member for McPherson. I shall try to do that. May I first of all thank him for his words of kindness to me, as I believe they were, in acknowledging my very deep commitments in relation to the issues under debate. Let me reciprocate to a degree by referring to the contribution by the honourable member for Casey (Mr Halverson). While I strongly disagree, as he did with the honourable member for Herbert, on the subject of exactly the solutions that we ought to be adopting and the criticisms of the Government, I nevertheless feel that his own contribution, in talking about the difficulties of service life, was extremely important. Very few of us in this place really do understand what service life is like and how difficult and disruptive it is of family life. My understanding has been gathered not as a serving member of the armed forces but as a local member who has endeavoured to work closely with the local community of service families. I acknowledge that the honourable member's knowledge is based on some very hard long years of service. Last Monday I had the honour of representing the Prime Minister (Mr Hawke) at the Anzac Day sunset service in Martin Place in Sydney. At that service representatives of the armed forces spoke of their concern that the Australian public is not aware of the sacrifices which members of the armed forces and their families make for their country. I strongly share and support those sentiments and I remind the people of Australia that the sacrifices that are made by members of the armed forces and their families are not made only in time of war, but are ongoing and evidence an ongoing commitment to defend this country. I have said before in the House but I want to say again that when I was first elected as the Federal member for Hughes I was totally unaware of the enormous problems that existed in service communities. It was only when I became a member that I became aware of the fact that at that time, in 1984, service personnel and their families were still very much treated as second-class citizens. I am proud to have been part of a successful campaign by service spouses to secure some justice from this Government; justice, I might add, which had not been forthcoming from the previous Liberal Government nor, I believe, from any government of any political persuasion since Federation. The story about how things really got moving in the Government and how we started to make some advances has never really been told. It is a great tribute to those service spouses who had the courage effectively to stand up to authority. They are very much the unsung heroes of this debate and of the great advances that are being made in the conditions of service families. As I have said, back in 1984 when I was first elected as member for Hughes, I was unaware of the conditions that people had to put up with. I was unaware that at Holsworthy-the major defence establishment in my electorate-there were, for all practical purposes, no shops. I was unaware of the incredible disruption to the lifestyle of families and children, caused by service families being moved around Australia at regular intervals. I was certainly unaware of the absolute dearth of any community spirit or community solidarity in service communities. I was also unaware of the fact that service communities just did not have the advantage of all those achievements of the 1970s that resulted in improvements to the quality of life of civilians-that awareness by people that they had a right to basic community services. When I went out to Holsworthy I met with people at the neighbourhood centre. I specifically requested a meeting. At that meeting we began to talk about the problems, and I am pleased to say that one of the skills I can bring to bear as a member of Parliament-I say this modestly-is an organisational and lobbying skill, which I decided to try to bring to bear in relation to service conditions. I pay tribute to the former Democrat Senator Colin Mason, who strongly championed the cause of service spouses. I might say, although I do not want to be particularly partisan in this debate, that members of the Liberal Party of Australia and the National Party of Australia were certainly nowhere to be seen. We organised a deputation of spouses to come to Canberra, and I believe that was the first time-this is something I will say many times in this debate-that a Federal Minister for Defence ever really listened to service spouses. Having said some nice things about members of the Opposition in this debate, let me give the down side. The down side of the Opposition's attitude at that time, which I hope is changing, was partially reflected in the comments made by the honourable member for McPherson (Mr White) when he referred to the Minister for Defence Science and Personnel (Mrs Kelly) in this debate and said, `For a woman you've got a hide as thick as a rhinoceros'. Unfortunately, that was the sort of condescending, sexist approach that high ranking officers of the department of Defence and politicians adopted towards service spouses. They did not recognise that people who live the life of a service spouse have rights and are thinking, caring people who are prepared to stand up and be heard for the advancement of their community. What happened when the Minister for Defence (Mr Beazley) met the women from that delegation-I have checked with my office-on 22 May 1985? He listened with great interest and compassion to their story. He did not try to stifle them; he encouraged them and invited them to talk to the media about their concerns, which they did on the front steps of Parliament House. The Minister subsequently visited Holsworthy Village. I recall a memorable meeting in a shabby hall in Holsworthy which was attended by in excess of 100 spouses and many screaming babies in a situation of absolute turmoil and chaos. The spouses poured forth their anger at the neglect that successive governments had shown, Minister Beazley listened, took note of what was said, and acted on the concerns that those spouses raised. Let me say, without singling out individuals, that people like Joanne Balserini, Beverley Bolton, Kathy Sinclair, Margaret Davis, Margaret Walton and Sue Brookshore were extremely courageous when they came to Canberra to stick their necks out, because that had not been done before. There they were on the front steps of Parliament House taking on the establishment. Of course, it is now well accepted that there is a national voice for service spouses, but at that stage there was nothing. These were people of great courage. I have spent some time on this matter because it is important to understand that the reforms of this Government were very much inspired by people power, by spouses getting together and deciding to speak out for the advancement of their community and their lifestyle. In 1985 Minister Beazley established an inquiry into the problems faced by spouses of Australian Defence Force personnel. As we all know, that inquiry was conducted by Sue Hamilton, Assistant Secretary, Office of the Status of Women, and it reported in April 1986. The inquiry was extremely substantial. It involved open meetings for spouses in just about every major area in Australia, and attendances at those meetings totalled in excess of 4,300 people; more than 700 submissions were made to the inquiry. I want to say something which is not only unrehearsed but which has occurred to me in the course of this debate: I hope that one of the things we can develop in this Parliament is a much stronger bipartisan approach regarding policies on service personnel. I believe that members on the Government side are committed to trying to achieve that if it is humanly possible. We have accorded defence the highest status within our Government. The Minister for Defence is a member of the Cabinet of the country. For the first time in the history of the Australian Parliament there is a Minister for Defence Science and Personnel who is directly and specifically responsible for the conditions of defence personnel and their families and for reporting to Parliament in that regard. However, in order to achieve a bipartisan policy, some policy commitments must emanate from the other side. It is a matter of great regret that in the 20 minutes for which the shadow Minister for defence, the honourable member for McPherson, spoke, not one single policy proposal was espoused for 15 minutes. After 15 minutes, and in the honourable member's remaining 5 minutes, a couple of ideas came forward. They included suggestions for more child care, more staff for Australian Defence Families Information and Liaison Staff (ADFILS), and spouse employment offices, and other ideas for greater government expenditure on defence. There is a massive problem, an insurmountable problem, that is, that the shadow Minister for defence does not speak for the Opposition on this matter. He is not in the shadow Cabinet and the people who call the shots in the Opposition have not proposed increases in defence expenditure to meet the needs that I believe we all acknowledge. Something has to be done, something even more than this Government has done, to improve conditions. Of course, the shadow Treasurer, the honourable member for Kooyong (Mr Peacock), has backed the call of the Business Council of Australia for massive spending cuts. Mr Webster —Not in defence. Mr TICKNER —Not in defence, says the honourable member for Macquarie. I refer the honourable member to the document put out by the Business Council of Australia at 6 o'clock on Sunday, 17 April, backed up by a Press statement issued by the shadow Treasurer, the honourable member for Kooyong, not only on the same date but at the same hour and the same minute, in collusion with the Business Council of Australia. At page 16 and 17 of its report the Council called for cuts of $300m in defence alone. I am glad that the honourable member for Macquarie (Mr Webster) displays an interest. Perhaps he should consider what his shadow Minister is saying. Among the $300m cuts proposed it was suggested that the Defence Housing Authority should fund the cost of new housing as far as possible from rents and borrowings. What will that do to the quality of life of families of Australian Defence Force personnel? There was a proposal for cuts of $300m in defence alone. Can honourable members believe that? What did the shadow Treasurer say about these spending cuts? Let us look at his document-and the honourable member is welcome to look at it. He said, in the first line: While the Business Council's call to reduce government expenditure is welcome, it does not go far enough. He wants more cuts in defence. Mr Webster —Did he say that it does not go far enough in defence? Mr TICKNER —He said that it does not go far enough. Proposals have been put forward by the Business Council of Australia which fall short of the demands of the shadow Treasurer in terms of expenditure cuts. There are many things I would like to have said in this debate, but time does not permit. I return to my major theme: let us have bipartisan policies. At present a joint committee is looking into Defence Force wastage. Let the Opposition put forward specific proposals for improvements. We on this side already have a commendable track record, and we will do a lot more. The time for rhetoric is over. It is time to put forward specific proposals. Until that occurs there is no credibility in the Opposition. Mr WEBSTER(Macquarie)(6.19) —I rise for only a few minutes at the conclusion of this debate. When we were advised of the statement by the Minister for Defence Science and Personnel (Mrs Kelly), it was suggested that there would be only a couple of speakers from each side, but I am glad to have the opportunity to comment at this late stage. I preface my remarks by reminding the House that within my electorate of Macquarie is the largest Royal Australian Air Force (RAAF) transport base in Australia, probably one of the biggest bases in the Commonwealth. I frequently visit that base purely as a member showing interest, and I meet many of the personnel at functions. Before I was elected to Parliament, I had many people from the base who, on their retirement, joined my staff in performing the work in which I was engaged. The main question that people in my electorate, and especially people associated with the RAAF base at Richmond, want answered tonight is: if things are as good as the Minister for Defence Science and Personnel suggested today and if the Government is doing so much, why are so many service personnel resigning? This question has been raised a couple of times already. The answer is quite simple. First, there is a lack of confidence in this Government and a sense of neglect and even, in some cases, of betrayal. There is also the knowledge that the best way to protest is by resigning. To me, that is what has happened. It is hard to criticise the Ministers handling defence matters when their intentions are right, and I believe they are. I believe that the Minister for Defence Science and Personnel and the Minister for Defence (Mr Beazley) are trying to do the best they can in exercising the responsibilities of their portfolios, but they stand alone in an unsympathetic Cabinet and that is where the main problem lies. Therefore, I will direct my criticisms not at these Ministers but at the Government which leaves them ill-equipped to respond to problems facing the defence forces. The main problem with the paper brought down this afternoon is similar to that which characterises the Government's economic policy-the pace of adjustment. For three years now, the Government has consulted, talked and promised. It regularly advises the Parliament that reforms are in place. Yet anyone in touch with the services knows that this is not true. I refer, for example, to postings. In the past few weeks, I made representations for an airman who was to be sent against his wishes to Adelaide. His replacement, who was to come from Adelaide, wanted to stay in Adelaide. But orders, no matter how irrational, are orders and the postings swap took place. The reforms about which the Minister for Defence Science and Personnel talks are not proceeding at the pace she suggests. I commend the initiatives in bonuses-of which we heard today-counselling, child care and education allowances, but I have to say, as the Minister knows, that they are too little too late. These announcements and orders on paper to lift morale will not restore the broken relationship that exists beween the Government and its service personnel. Ministerial statements and afternoon teas at bases will not solve the crisis in the Australian Defence Force. What is needed is the restoration of funds cut in past Budgets-and we have seen it happen in every one of the Government's Budgets. Also needed are radical boosts to the programs announced today, and a new commitment from the Government to those who are expected to give their lives. That point seems to be getting put aside regularly these days. We are talking about people in our armed forces who may one day be expected to give their lives for this country. It is surprising that the statement today was brought down in the shadow of Anzac Day, which I am glad to say was a day of great remembrance in my own electorate and indeed throughout Australia. I hope that the Minister will not be remembered as one of those politicians who, by failing to promote political will in government for defence, betray those who may be sent ill prepared into battle in some future war. To escape that possible ignominy, she and the Minister for Defence need to do a lot more in the next Budget than they have been able to achieve in past Budgets. Question resolved in the affirmative. Bill presented by Mr Duncan, and read a first time. Mr DUNCAN(Makin-Minister for Employment and Education Services)(6.26) —I move: That the Bill be now read a second time. The main purpose of this Bill is to amend the States Grants (School Assistance) Act 1984 to supplement for cost increases grants already appropriated for government and non-government schools programs in 1988. The Bill also modifies certain existing provisions in the Act relating to non-government schools which change their location. Under the new provisions, where the change is to a location adjacent to the school and, where it does not involve a change in the level of education being provided by the school, the school or school system will no longer be required to notify the Minister of the change. These new provisions will apply to schools which are seeking approval this year to change their location in 1990. Further amendments include: extension of the provisional approval period to two years for new non-government schools or for a school undergoing a notifiable change; new non-government schools will now be eligible for establishment grants if they serve a developing area. Previously these schools were required to be situated in a developing area. The total amount of supplementation to be provided by this Bill is $21m. I commend the Bill to the House and present the explanatory memorandum to this Bill. Debate (on motion by Mr Miles) adjourned. Bill presented by Mr Duncan, and read a first time. Mr DUNCAN(Makin-Minister for Employment and Education Services)(6.28) —I move: That the Bill be now read a second time. The States Grants (Tertiary Education Assistance) Act 1987 was introduced and passed in the Parliament in the last session to provide grants to the States and the Northern Territory for universities, advanced education, institutes of tertiary education and technical and further education for 1988. The main purpose of this Bill is to amend that Act to adjust for cost movements in the tertiary education grants. It will also provide additional funds for superannuation in higher education to cater for the 3 per cent productivity claim and emerging costs for the States. As part of the Government's drug offensive it has been decided that funds should be made available for the coordination of drug and alcohol education in teaching hospitals. It is felt that an important means of combating drug and alcohol abuse is to ensure that the curriculum for undergraduate students in medical schools brings out the dangers and problems that arise from this abuse. Consequently provision is made in this Bill for funds to be made available under a new program for the 10 university teaching hospitals presently receiving recurrent funds from the Commonwealth Government. The funding for this new program is to be provided initially through the Department of Employment, Education and Training, and in 1988 will amount to some $560,000. In total the Bill will provide for additional Government expenditure of some $66.5m of which $42.9m will result from the Government's agreed procedures to make retrospective adjustment for cost variations and some $23m will be provided in connection with superannuation in higher education institutions. In introducing this Bill we have also taken the opportunity to make a number of minor technical amendments. Non-government teachers colleges have been provided with grants under the special assistance for students program in line with other higher education institutions. They have not however been required to produce as a condition of this grant statistical and other information pertinent to this program. In line with the requirements for other higher education institutions we have now included this as a condition of grant under this program. We have also, consistent with grants for higher education institutions, made provision for grants under the States Grants (Nurse Education Transfer Assistance) Act 1985 to be offset in accounting procedures by institutes of tertiary education. In the technical and further education sector we have recognised that building work undertaken up to the end of a particular year and commitments entered into for the purchase of equipment during the year cannot necessarily be paid for within that year. Consequently grants for 1988 need not necessarily be expended in 1988 but may be carried over for later payment. It is to be stressed that this Bill is of a routine variety consistent with amending Acts made in previous years to legislation providing funds for tertiary education. I present the explanatory memorandum to this Bill and commend the Bill to the House. Debate (on motion by Mr Miles) adjourned. Sitting suspended from 6.30 to 8 p.m. Bill presented by Mr Howe, and read a first time. Mr HOWE(Batman-Minister for Social Security)(8.01) —I move: That the Bill be now read a second time. The Commonwealth Employees' Rehabilitation and Compensation Bill 1988 seeks to repeal the Compensation (Commonwealth Government Employees) Act 1971 and to introduce a new scheme of compensation and rehabilitation for persons who are injured in the course of their employment by the Commonwealth. Between 1976 and 1986, the Commonwealth's expenditure on workers' compensation increased by over 700 per cent, from $25.04m to $203.29m per annum. Clearly, this situation could not be allowed to continue. Accordingly, the Government decided that the compensation Act should be reviewed with the aim of establishing a more equitable and cost-effective compensation system, with particular emphasis on the rehabilitation of injured employees. The result is a Bill which, when it comes into operation, will provide for many important changes in the compensation system and the circumstances in which compensation will be payable. The Bill will minimise the human and financial cost of work-caused injury and disease while at the same time providing adequate compensation and support for long term incapacitated employees. The main aspects of the new scheme are the provision of a better range of benefits for injured employees and the establishment of a new body to administer the Act. The Bill will also provide incentives for injured employees to return to work as soon as possible and will provide greater powers in relation to rehabilitation. The Office of the Commissioner for Employees' Compensation will be abolished and replaced by the new Commission for the Safety, Rehabilitation and Compensation of Commonwealth Employees. The new Commission will consist of three persons to be appointed by the Governor-General-a Chief Executive Officer and two part-time commissioners, one to represent the Commonwealth and the other to represent the interests of employees. This structure will allow employees and employing agencies to participate directly in the administration of the compensation and rehabilitation system. Some specific functions of the Commission will be: to determine claims accurately and expeditiously; to minimise the duration of incapacity by arranging for the assessment of the rehabilitation needs and prospects of employees; to cooperate with other bodies with the aim of reducing the incidence of work-related injuries; and to conduct and promote research into the incidence and prevention of work-related injuries. The Commission will be required to comply with directions of a general nature issued to it by the Minister. While the new scheme will be administered primarily by the Commission, the Bill makes provision for statutory authorities to be appointed in the future as self-administrators by ministerial notice in the Commonwealth of Australia Gazette. Those authorities will have all the powers and functions of the Commission in relation to the determination of claims lodged by its employees but will also be required to comply with ministerial directions. The Commission will be required to report on the operations of self-administrators under the legislation and the Chief Executive Officer will be empowered to require the provision of such information as is necessary for that purpose. Self-administration will help to instil an awareness in those authorities of the costs of compensation and the benefits to be derived from effective rehabilitation and occupational health and safety measures. Under the existing Act, the Commissioner determines the liability of the Commonwealth to pay compensation. This legislation will impose that liability to pay compensation on the Commission or self-administrator. In order to fund the system, the Commission will be required to calculate, on the basis of the each organisation's claims record, the contributions to be made by departments and statutory authorities to the Consolidated Revenue Fund. These contributions will act as a direct financial inducement to each department and statutory authority to reduce workers' compensation costs by effective rehabilitation and occupational health and safety measures. I turn now to the benefits which will be payable under this legislation. The benefits package is aimed specifically at assisting those employees most in need-that is, the long-term incapacitated workers. At the heart of the new scheme is the change from a system of fixed long-term benefits adjusted by regulation to one of weekly benefits calculated on the basis of the individual employee's normal weekly earnings. An employee's normal weekly earnings will be based on his or her pre-injury salary and will take into account certain allowances and regular rostered overtime which the employee is required to work as a condition of his or her employment. Employees who are incapacitated for work will receive weekly benefits equal to 100 per cent of normal weekly earnings for the equivalent of the first 45 weeks of that incapacity. Where appropriate, the Bill will encourage employees to return to work on a gradual basis by allowing their income to increase according to the number of hours worked. For example, an employee who returns to work for 50 per cent of the number of hours he or she worked before the injury would be entitled to an amount of compensation which, combined with the income from that employment, would provide the employee with 85 per cent of his or her normal weekly earnings. There will be upper and lower limits on weekly payments so as to provide a measure of equality and a guaranteed minimum income for those who are on a low wage. The maximum amount payable will be an amount equal to 150 per cent of average weekly earnings for all employees in the Australian work force. The minimum amount will be either $202 per week plus $50 for a dependent spouse and $25 for each dependent child, or 90 per cent of the employee's normal weekly earnings, whichever is the lower. These benefits will be indexed automatically in line with movements in the consumer price index. The level of weekly benefits payable to an injured employee who is capable of returning to work will be calculated by subtracting the amount the employee is earning, or would be able to earn in suitable employment, from his or her normal weekly earnings. Suitable employment for an employee who is permanently employed by the Commonwealth will mean employment by the Commonwealth or a statutory authority. In the case of a casual employee, suitable employment may include self-employment or employment in private industry. This distinction reflects the Government's commitment to maintaining the employer-employee relationship and reinforces the nexus between an employee's contract of employment and his or her rights to compensation. Given that benefits under the scheme have been set at levels which are fair and equitable, the Government has decided that it would no longer be appropriate for employees to be able to redeem weekly benefits for lump sums except where those weekly payments are below $50 per week. Weekly payments will cease at age 65. This Government does not consider it appropriate that employees should continue to receive workers' compensation benefits after the normal retirement age. Under the existing Act an employee was required to establish only that his or her employment was a contributing factor in the contraction of a disease. This test does not adequately reflect the rights and obligations of the Commonwealth and its employees in relation to work-related disease and frequently results in the Commonwealth being liable to pay compensation for diseases which have little, if any, connection with employment. This Bill seeks to remedy that situation by requiring an employee to show that his or her employment contributed in a material degree to the contraction of the disease. The Government believes that this is a test which is firm but fair and which properly reflects the balance between the interests of the Commonwealth as employer and its employees. An employee will not be required to show that his or her employment caused the disease, or even that it was the most important factor in the contraction of the disease. It is intended that the test will require an employee to demonstrate that his or her employment was more than a mere contributing factor in the contraction of the disease. Accordingly, it will be necessary for an employee to show that there is a close connection between the disease and the employment in which he or she was engaged. In determining whether employment contributed in a material degree to the contraction of a disease in a particular case, regard would be had to whether the employment in which the employee was engaged carried an inherent risk of the employee contracting the disease in question and whether some characteristic or feature of the employment tended to cause, aggravate or accelerate the disease. A disease which has been contributed to in a material degree by employment will be deemed to be an injury. Compensation will be payable if that injury results in the death, incapacity or impairment of the employee. The Bill will also contain disease provisions, similar to those contained in the existing Act, under which an employee suffering a specified disease will automatically be entitled to compensation if he or she had been engaged in certain specified kinds of employment. The Bill will extend coverage to employees injured in ordinary recesses, such as lunch breaks, and by acts of violence arising as a result of their employment by the Commonwealth, for example, staff working overseas injured by warfare, terrorism, et cetera. The journey provisions in the existing Act have been modified to require that journeys to or from the place of employment must commence or terminate at the employee's place of residence. A significant factor in the escalation of compensation costs which I described earlier is the length of time that employees remain on compensation. It is obvious to this Government that the only way to reduce the period spent on compensation is by the effective rehabilitation of injured employees. To this end, the Bill will encourage the speedy rehabilitation of employees who are injured by enabling employing agencies or the Commission to arrange for the assessment of the rehabilitation needs of the employee and the type of work which that person could perform following appropriate retraining. Consistent with the goal of minimising incapacity and impairment, employing agencies and the Commission will have much broader powers in relation to the provision of rehabilitation programs than were previously available. The Commission will be able to approve persons and organisations as rehabilitation program providers and to arrange directly with them for the provision of rehabilitation programs tailored to the individual needs of employees. If an employee refuses to undertake a rehabilitation program, his or her rights to compensation will be suspended. On the other hand, employing agencies will be required to take all reasonable steps to provide suitable employment for employees who have undertaken rehabilitation programs. The Commission will also examine the introduction of a new system of work trials for injured employees to enable them to participate fully in the work force. The Commission will have the power to arrange for the provision of necessary aids and appliances, and home, vehicle or workplace modifications. In conjunction with this, the Bill will provide for the payment of up to $200 per week in compensation if, after four weeks of incapacity, the employee reasonably requires another person to provide household services, such as cooking, cleaning and household maintenance. A further amount, up to a maximum of $200 per week, will be payable if he or she reasonably requires attendant care services, such as feeding, bathing, supply of medication or other services of a personal nature. In addition to the weekly benefits which I have already outlined, the Bill will provide for the payment of lump sums for permanent impairment and non-economic loss. These payments will replace awards of damages at common law for losses of a non-economic nature. A maximum of $80,000 will be payable for injuries which result in a permanent impairment and up to $30,000 for non-economic loss. Under the existing Act, lump sum payments are made on the basis of a table of maims, with the level of payment being determined having regard to the loss, or loss of the efficient use, of various parts of the body. That approach has been abandoned and the level of payments in future will be determined using a `whole person' approach, similar to that used under the Veterans' Entitlements Act 1986. The whole person approach allows the degree of impairment to be assessed on a more accurate basis and expressed as a percentage loss of the use of the ability of the person to undertake normal living activities. A guide to the assessment of amounts of compensation payable in cases of permanent impairment will be prepared by the Commission for the purposes of the Bill, subject to ministerial approval. There will be a minimum threshold of 10 per cent impairment under which compensation will not be payable, except where the impairment resulted from the loss of a finger or toe. In recognition that a permanent impairment may lead to considerable pain and suffering and loss of enjoyment of life, up to $30,000 will also be payable for any non-economic loss suffered by an employee. The non-economic loss element of compensation will also be assessed in accordance with the approved guide. This Government recognises that special provision must be made for the dependants of an employee who has died as a result of a work-related injury. Accordingly, the death benefit payable under this legislation will be raised to $120,000 more than double that which was payable under the existing Act, and a further $40 per week will be payable for each dependent child of the employee. It is intended that, in administering the Act, the Commission will expedite the payment of death benefits in order to avoid creating hardship, particularly in cases where the surviving spouse and children were living in the same household as the deceased employee. Perhaps the most controversial aspect of the new legislation is that common law actions against the Commonwealth will be replaced by the comprehensive benefits which I have described. It is clear to this Government that the common law negligence action which bases its entitlement on proof of fault is a costly, inefficient and inappropriate mechanism for compensating injured workers. Delays in settling these actions act as a positive disincentive for employees to return to work and encourage them to maximise the extent and duration of their injuries. The provision of an adequate level of weekly income, substantially increased lump sum payments on death or impairment, payments for additional expenses for medical costs, aids and appliances and household help, combined with a commitment to rehabilitation and the return to suitable employment, make redundant any need for redress to the courts. Accordingly, it will no longer be possible for an employee to sue the Commonwealth or a fellow employee. Actions against third parties will also be discouraged. Employees or their dependants who sue third parties will not be entitled to receive further benefits under the scheme and will be required to pay back any amount of compensation they have received. The Commission will pursue third parties if necessary by taking over an action in place of the employee. There are some other matters which this Bill will address. For example, under the current system, an employee is deemed to be on unauthorised absence after two years absence from work as a result of an injury. This unjust situation will be remedied in this Bill. An employee who is incapacitated for work following a compensable injury will be considered to be on compensation leave. Compensation leave is designed to continue the employer-employee relationship during the period of incapacity. This is a significant improvement on the current system. An employee on compensation leave will, for the first 45 weeks of incapacity, continue to accrue sick leave and annual leave entitlements. Long service leave entitlements will continue to accrue throughout the whole period of incapacity. This Bill will also seek to reduce the unreasonable costs associated with work-related injuries by introducing measures to prevent double dipping by employees using sick leave payments or superannuation entitlements while on compensation. For example, many employees who have been retired on invalidity grounds under the current legislation enjoy benefits under both compensation and superannuation schemes at a rate considerably in excess of their previous income. Special transitional provisions relating to the combined superannuation and compensation benefits payable to employees who have been invalided out of employment are contained in the Bill. Top up of weekly benefits from sick leave entitlements will be prohibited. Payments by way of salary, wages or pay under compensation schemes in force in the States will reduce compensation accordingly. No make up pay or additional benefits under awards will be allowed where an employee receives benefits under this legislation. The review and appeal provisions contained in the Bill are significantly different from those contained in the existing Act, under which the Commonwealth is generally the respondent in proceedings for review of determinations made by the Commissioner for Employees Compensation. This Bill will provide for the Commission to be respondent in proceedings before the Administrative Appeals Tribunal and the courts, and will also introduce compulsory reconsideration by the Commission before application can be made to the Tribunal for review of a determination. Reconsideration will be an informal procedure under which the original determination of the Commission will be reviewed by an officer of the Commission not involved in the original decision. Parties will be encouraged to adduce all relevant evidence at the reconsideration stage so as to resolve as many disputes as possible before the matter is heard by the Tribunal. These measures will facilitate the settlement of many applications for review before a formal hearing is held and improve the quality of primary decision making, thereby reducing the number of appeals to the Tribunal. In short, the Commission's direct involvement in review proceedings will be of mutual benefit to the Commission and the Tribunal. Madam Speaker, the Government considers that this Bill will create a progressive compensation and rehabilitation system for Commonwealth employees which will result in fewer injuries, less suffering, lower costs and a better quality of life for those employees unfortunate enough to be injured in the course of their employment. I commend this Bill to the House and present the explanatory memorandum. Debate (on motion by Mr Connolly) adjourned. Bill presented by Mr Howe, and read a first time. Mr HOWE(Batman-Minister for Social Security)(8.22) —I move: That the Bill be now read a second time. The purpose of this Bill is to apply the provisions of the proposed Commonwealth Employees Rehabilitation and Compensation Act 1988 to civilian employees of the Government of the United States of America at the naval communication station at North West Cape. These persons are currently covered by the Compensation (Commonwealth Government Employees) Act 1971, which is to be repealed. The proposals put forward in this Bill will have no impact on government expenditure since, under the terms of the agreement between the governments of Australia and the United States which establishes the station at North West Cape, the Government of the United States will reimburse the Commonwealth for any expenditure incurred under this Bill. I commend the Bill to the House and present the explanatory memorandum. Debate (on motion by Mr Connolly) adjourned. Bill presented by Mr Barry Jones, and read a first time. Mr BARRY JONES(Lalor-Minister for Science, Customs and Small Business)(8.24) —I move: That the Bill be now read a second time. The Customs Tariff Amendment Bill 1988, which is now before the House, contains a wide variety of amendments to the Customs Tariff Act 1987. Schedule 1 to the Bill, operative on and from 1 January 1988, contains a number of amendments. The first set of amendments relate to revised charging arrangements for general aviation aircraft at Essendon, Coolangatta and Launceston airports. Aircraft using aviation gasoline, Avgas, will now no longer be subject to terminal, navigation, rescue and firefighting charges for landings at these airports. The revenue forgone as a result of this change will be offset by a half a cent per litre increase in the excise and customs duty on aviation gasoline. These revised arrangements were introduced after consultation with the aviation industry had revealed that, under the previous charging arrangements which came into effect last July, general aviation Avgas operators who used the three airports were disadvantaged compared with their competitors operating at the general aviation capital city secondary airports. The extent of the disparity was not foreseen by either the industry of the Department of Industry, Technology and Commerce at the time the changes were made last July. The changes relating to customs duties on certain petroleum products are also included in this schedule and ensure that the rates that became operative on and from 14 December 1987 are carried over the principal Act. The next set of amendments relates to the Government's decisions on the Industries Assistance Commission's reports on the pulp, paper, paper products and printing industries, medical and scientific equipment and glass and glassware. The Government decided to accept the recommendations contained within the Commission's report on the pulp, paper, paper products and printing industries that tariffs assisting these industries be reduced over a two-year period on a tops down basis to a maximum of 15 per cent. Tariffs are generally 20 to 25 per cent, but many are at 10 per cent and below. All phasing of rates would commence from 1 January 1988. Some tariff anomalies will be corrected and concessional entry allowed on coated paper and on some other types of paper not produced locally. Tariff assistance for paper-making machinery will be reduced to minimum rates. Policy by-laws have been implemented to allow for paperboard used in cigarette packages and aseptic liquid containers to enter at minimum rates and for paperbacked textile wall coverings to enter at 15 per cent, the same rate as `paper' wallpaper. The Government rejected some of the Commission's recommendations and will not reintroduce the bounty on certain types of paper which expired last February. The pulp, paper, paper products and printing industries constitute a large and diverse sector of the Australian economy. These industries have specific areas with potential of developing into internationally competitive and technologically developed sectors of the economy. In its decision on the medical and scientific equipment industry the Government has accepted the thrust of the Industries Assistance Commission's recommendations for reduced tariff assistance. Tariffs will be phased down progressively over two years commencing on 1 January 1988, with the general rate of 15 per cent being reached on 1 January 1990. The bulk of imports will continue to enter at minimum rates. Following the receipt of the Industries Assistance Commission's report on glass and glassware the Government decided to adopt, with a few exceptions, an industry-wide tariff rate of 15 per cent for the glass and glassware industry. Tariffs above 15 per cent are to be reduced on a `tops down' basis over three years to reach 15 per cent on 1 January 1991. The Government was of the opinion that the decision would minimise tariff-induced distortions in trade and investment decisions, thereby improving the international competitiveness of Australian industry. The Government also decided not to grant any short term assistance to users of glass fibre rovings who were required to pay higher prices for imports at a time of tight domestic supply. Amendments to implement certain changes in accordance with Australia's international trade agreements obligations are included. A series of amendments made in the context of the current textiles, clothing and footwear sectoral policy are also included. These cover variations to the developing country exclusions from preference which are made annually; the insertion of the 1988 tender quota rates of duty following the settlement of the relevant premium tender quota rates; the extension of the validity of the 1987 quota allocations; and an increase in the customs value criterion which determines whether footwear is subject to tariff quota from $1.35 to $1.45. This schedule includes amendments to redress assistance anomalies which have become apparent following publication of the harmonised tariff. Six anomalies have been brought to notice which would have unacceptable consequences for the industries concerned. These, and the remedial actions proposed, are: Polyethylene terephtahlate- Duties are reduced from ten per cent to two per cent when used to make fibres and yarns. The change involves broadening the terms of a customs by-law; Parts for leather coats, jackets, and the like- This amendment ensures these goods continue to be subject to tariff quota; Hand-made rugs- The purpose of this amendment is to continue duty free entry of certain carpets until June 1988. These rugs and carpets are made by powered machines that are held in the hand and were not to be eligible for concessional entry following the Government's review of the textiles, clothing and footwear handicraft arrangements. They were to be subject to the carpet duty rates of 40 per cent general and 30 per cent developing countries from 1 January 1988. However, after representations from importers a review of the decision resulted in a deferral of implementation until 1 July 1988 to ensure that undue hardship does not occur to importers' business operations; Men's or boys' suits- An amendment to ensure that men's or boys' suits that consist of a jacket and a pair of shorts continue to be subject to quota; Adjustable shoulder straps for brassieres- An amendment to correctly exclude these goods from quota and thus maintain the arrangements that existed prior to the introduction of the harmonised tariff; Paper sheeters, slitters, slitter-rewinders and rewinders- This amendment will restore tariff assistance to local production of paper sheeters, slitters, slitter-rewinders and rewinders. Producers of these goods suffered a substantial loss of tariff assistance on 1 January when the previous import duty of 15 per cent was reduced to minimum rates. When Cabinet approved the introduction of the harmonised tariff it gave authority to the Minister for Industry, Technology and Commerce (Senator Button) in consultation with the Minister for Foreign Affairs and Trade (Mr Hayden) and other relevant Ministers, to approve modifications on compelling industry grounds, before 1 January 1988. After receiving a submission on behalf of the bulk of the Australian industry and considering the arguments put forward it was concluded that this small industry could suffer serious injury, with consequent job losses, if tariff assistance were not restored. All Ministers consulted agreed that compelling industry grounds existed for restoration of the moderate 15 per cent tariff rate which applied prior to 1 January. Restoration of the Government's intended level of assistance will help to maintain the viability of the industry. Two further amendments which, through the restructuring of the tariff, correct existing inconsistencies in tariff drafting are- (A) Blinds and fittings and mountings for curtain tracks of polymers of styrene or vinyl chloride were incorrectly classified; and (B) The tariff structure for therapeutic respiration apparatus could result in an incorrect rate of duty being collected. This change arose from the Government's consideration of the Industries Assistance Commission's report on medical and scientific equipment. The final group of amendments includes redrafting of a minor nature. Schedule 2, operative on and from 3 February 1988, provides the basis for fulfilling the commitment of the Prime Minister (Mr Hawke) given at the Ruby Hutchison Memorial Address of 13 March 1987 to limit the indexation increases for August 1987 and February 1988 to a total of around 6 per cent. The amendments decrease the rates of duty as applying immediately prior to indexation on the February 1988 adjustment date so that when the legislative provisions for indexation are applied, which require the use of the published consumer price index, the resultant indexation increase is 2.5 per cent. This increase, when combined with the August 1987 indexation adjustment-3.5 per cent-yields a total indexation adjustment of 6 per cent. Schedule 3, which is operative seven days after the royal assent, contains a variety of amendments. The first set of amendments results from further Government decisions on the Industries Assistance Commission's reports on the chemicals and plastics industries, the pulp, paper, paper products and printing industries and glass and glassware. The amendments are: Pigments- The changes proposed for inorganic pigments will provide significant benefits to industries using these products. The current very complex structure will be substantially simplified. This will ensure that the intent of the Government's decision on the policy for chemicals and plastics is properly realised. It will also assist industry by permitting more accurate and efficient classification of imports of these pigments; Calendars- The general tariff rate for calendars of a kind other than paper and paperbound of heading 4910 will be phased from 25 per cent on implementation on 1 January 1988, to 20 per cent from 1 January 1989 and to 15 per cent on 1 January 1990 in line with the phasing arrangements for the general tariff rate for calendars of paper and paperboard. This will avoid the creation of an anomaly in assistance between paper and paperboard calendars and calendars of other materials; Tampons- The Government decided to set the general tariff rate for tampons at 2 per cent. An anomaly previously existed in that tampons entered under tariff item 59.01.000 were dutiable at 2 per cent whilst, if entered under sub-item 48.21.900, were dutiable at 25 per cent. This proposal avoids the anomaly. All goods other than tampons of subheading 5601.10 are to be dutiable at 15 per cent in order to bring subheading 5601.10 into line with the long term industry rate under subheading 4818.40. There are two further amendments to apply the correct rate of customs duty where the drafting of the tariff structure could result in incorrect rates of customs duty being collected. These amendments involve the duties applying to graduated rules and machine and hand scales; and certain types of cords, cordage, braids and sleeving of glass, and arise from the Government's consideration of the Industries Assistance Commission's reports on medical and scientific equipment and glass and glassware. Finally this schedule includes an amendment to part II of schedule 4 where the Government has decided to admit free of customs duty national or traditional costumes imported by recognised ethnic groups. This will facilitate imports of genuine ethnic items in non-commercial quantities. Financial Impact The decision on the pulp, paper, paper products and printing industries will result in an estimated decrease in revenue of $1.31m in 1987-88, $9.65m in 1988-89 and $21.79m in 1989-90. The impact of the decision on medical and scientific equipment is difficult to assess and the duty reductions are likely to stimulate import growth in this already fast growing market. Such growth may completely offset the lower duty rate to be applied. The decision on glass and glassware will result in an estimated decrease in revenue of $95,000 in 1987-88, $350,000 in 1988-89 and $700,000 in 1989-90. The decision on the hand-made rugs will result in revenue forgone during the period 1 January 1988 to 30 June 1988 of approximately $90,000. Whilst it is difficult to estimate the impact in regard to the decision on pigments, it is considered that there will be a small increase in revenue. Whilst there may be an initial reduction in revenue in regard to the decision on polyethylene terephthalate, this will be offset, at least in part, by the stronger competitive position of the relevant manufacturers. The other changes in the Bill are expected to have minimal financial impact. Details of the amendments contained in this Bill have been included in an explanatory memorandum which has been circulated for the information of honourable members. I commend the Bill to the House. Debate (on motion by Mr Connolly) adjourned. Bill presented by Mr Barry Jones, and read a first time. Mr BARRY JONES(Lalor-Minister for Science, Customs and Small Business)(8.40) —I move: That the Bill be now read a second time. The Customs Tariff Amendment Bill (No. 2) 1988, which is now before the House, gives effect to part of a package of measures announced by the Government on 13 April 1988 aimed at reinforcing the strategy and objectives of the Government's passenger motor vehicle policy and continuing the process of structural change in the automotive industry. On 29 May 1984, when the Government announced the current motor vehicle policy, or the plan as it has become more commonly known, it was indicated that special consideration would be given in early 1988 to the state of the industry report for 1987 prepared by the Automotive Industry Authority. The intent was to conduct a mid-term review of the plan to assess progress being made by manufacturers to model rationalisation and the success in achieving greater efficiencies in component production. That review formed the basis of the changes now being introduced by the Government. The plan, which was introduced in 1985 and runs through to the end of 1992, aims to: give the industry time to restructure and modernise, make it more efficient and internationally focused, hold down the price of cars, reduce job losses in the short term and provide long term job stability. The strategy for pursuing these objectives involves the following integrated elements: rationalisation of the assembly industry in terms of models and manufacturing groups, rationalisation of the components sector to reduce industry fragmentation and costs, increasing competitive pressure on the industry by Gradually reducing barrier protection, and providing a stable policy framework which will allow adjustment to occur over a period of time with minimum disruption and cost. The Government believes that the plan has enjoyed substantial success in its first three years. To increase industry volumes and economies of scale, the Government set the industry a target of reducing, by 1992, the number of models from 13 to six and the number of manufacturing groups from five to three. Through industry restructuring and rationalisation of companies and model lines, these objectives are well within reach. The Automotive Industry Authority advises that it expects that only eight models will be manufactured by the end of 1989, and following the December 1987 announcement of a joint manufacturing venture between AMI Toyota Ltd and General Motors-Holden's Ltd, the number of manufacturing groups has now been reduced to four. Further cooperative manufacturing ventures are likely. Increased investment activity associated with new product development and upgrading plant and equipment has also been apparent as the industry prepares itself for the post-1992 period. The vehicle sector, for example, has increased its investment from $194m per annum in the period 1982-1984, prior to the introduction of the plan, to $503m per annum in the period 1985-1987. During the life of the plan we have also witnessed a dramatic increase in automotive exports. In 1987 automotive exports reached $755m, an increase of 63 per cent over the previous year and almost double the level of exports in 1984. While devaluation has clearly been an important element in this success, the export facilitation arrangements of the plan, together with a much stronger commitment to export by industry management, have also been important. Nevertheless, in spite of the undoubted successes of the plan so far, the Government recognises that there are changed circumstances which threaten the plan's objectives. The major unforseeable change since 1984 has been the fall in the value of the Australian dollar. This has altered the relative competitiveness of locally produced and imported products to the extent that the competitive pressure now on the domestic industry is well below that envisaged in 1984. As evidence of the substantial erosion of importers' competitiveness, the importers' market share is now about 11.4 per cent compared with over 15.5 per cent only two years ago, 1987 and 1988 tender quotas attracted zero premiums and both 1986 and 1987 quota allocations were significantly underutilised. The depreciation has also had the effect of forcing price increases in the industry at a rate well above those occurring in the economy generally. In summary, the Government believes that the effects of the depreciation on relative competitiveness threaten to erode the benefits of industry rationalisation achieved to date and, by reducing competitive pressure on the industry, significantly blunt the effectiveness of a major element of the plan strategy. They have also seriously hindered progress towards the plan objective of lower real prices. Accordingly, following advice from the Automotive Industry Authority and the Department of Industry, Technology and Commerce, and after consultation with the industry and its unions, the Government has introduced changes considered necessary to ensure that the plan remains an effective mechanism for transforming the industry into a competitive force in the 1990s. This Bill gives effect to the following changes being made to the tariff elements of the plan: The abolition of tariff quotas, and the reduction of the 57.5 per cent tariff on completely built-up (CBU) motor vehicles to 45 per cent with effect from 13 April 1988. From 1 January 1989 there will be further annual reductions leading to an end rate of 35 per cent in 1992. Completely knocked down (CKD) packs and certain original equipment components will also now attract the CBU tariff rates. To retain competitive relativities, the tariff rates applying to CBU light commercial vehicles and those CBU four-wheel drive vehicles, including amphibious vehicles, not classified as passenger substitutes are to be reduced from 35 per cent and 25 per cent respectively to 20 per cent for the remainder of this year. This rate will be phased down in annual reductions to an end rate of 15 per cent in 1992. The tariffs on CKD light commercial vehicles and CKD four-wheel drive vehicles, including amphibious vehicles, now become 10 per cent. Margins of preference applying to goods of developing country, Canadian and Forum Island country origin remain unchanged, and goods of Papua New Guinea origin remain free of duty. Tariffs on goods of New Zealand origin will be subject to the lower of the current rate or the rate applicable to Canadian goods. Discussions are, however, now under way between Australian and New Zealand officials in the context of the Australia-New Zealand closer economic relations trade agreement. Other elements of the Government's decision which are not covered by this Bill, but which are an integral part of the overall package of changes, involve certain amendments to the local content and export facilitation arrangements of the plan. Administrative action to give effect to these changes is occurring and does not require legislation. Briefly, the changes to the local content scheme involve the introduction of a simpler and less stringent system of penalties for non-achievement of the 85 per cent local content target. Beginning in 1989, the penalty will be the same as the duty rate applying to CBU passenger motor vehicles. This change will provide considerable additional flexibility to the vehicle manufacturers in their sourcing arrangements and, as such, increase competitive pressure on the components sector. The currency devaluation, through the local content scheme, has provided an unhealthy degree of protection to domestic component suppliers. In relation to export facilitation, each of the three schemes in operation has been extended in slightly different ways to ensure that they continue to play a significant role in promoting rationalisation and helping the industry gain a foothold in major export markets. They are an important adjunct to the other mechanisms of the plan and the Government wants to ensure that the momentum they have created is not lost. In conclusion, the changes outlined in this Bill form part of a package of measures introduced by the Government to reinforce the original plan framework and maintain progress towards the objectives agreed upon by industry and Government in 1984. While considerable progress towards most of these objectives has occurred, the Government believes that the changes it has made are necessary and appropriate to accommodate the changed circumstances and build on the emerging strengths. Financial Impact Statement The revenue implications of the tariff changes cannot be estimated with any satisfactory degree of accuracy because of uncertainties about price and market response and the effects of other economic factors on consumer behaviour in this market. Nevertheless, it is suggested that, in 1988-89, a net revenue gain will occur. The abolition of tariff quotas and the simplification of the local content provisions will reduce administration costs to government and the vehicle industry. Details of the amendments contained in the Bill have been included in an explanatory memorandum which has been circulated for the information of honourable members. I commend the Bill to the House. Debate (on motion by Mr Connolly) adjourned. Mr HAND(Melbourne-Minister for Aboriginal Affairs) —I table directions under section 11 of the Aboriginal Development Commission Act 1980. Bill presented by Mr Beazley, and read a first time. Mr BEAZLEY(Swan-Minister for Defence)(8.51) —I move: That the Bill be now read a second time. I am presenting this Bill as the Minister assisting the Minister for Defence Science and Personnel (Mrs Kelly) and I must say that in a small way this embodies yet another of her achievements on behalf of the defence personnel for whom we share responsibility. The purpose of this Bill is to make three small but important groups of amendments to Acts in the Defence portfolio. One group of amendments relates to the commutation of pensions by retiring members of the Defence Force under the Defence Force Retirement and Death Benefits Act 1973. The Act enables retirees in receipt of retirement pay and some categories of recipients of invalidity pay to elect to commute a proportion of their entitlements to a lump sum. As the Act stands, the election cannot be made until after a person has retired, and it is not effective until it is received by the Defence Force Retirement and Death Benefits Authority. There has been concern that if a retiree died before being able to make an election, no lump sum payment could be made. As a result, it is common for potential retirees, in order to protect the interests of their dependants, to take out short term insurance to provide a lump sum payment in the event of their death during the critical period. In more common cases, the time necessarily taken for the processing of an election and payment of a commutation amount can cause complications for retiring members in their adjustment from service to civilian life. These substantial payments are an important part of post-retirement financial planning. As an example, delay caused by the inability of retirees to make an election until after retirement may require retirees to take out short term bridging finance to cover house purchases. The Bill amends the Act to enable retiring members to make the election up to three months before retirement to be effective on retirement, thus eliminating the necessity for taking out insurance. Timely payment will also assist members in their resettlement arrangements. It should perhaps be added that, if a member dies or is retired on invalidity grounds before an election becomes effective, no commutation payment is made. Another group of amendments relates to the constitution of the Defence Housing Authority. Under section 12 of the Defence Housing Authority Act 1987, the Authority comprises nine persons, being the Chairperson, the Managing Director, three members of the Defence Force, a member of the Public Service and three appointed members, the latter being persons with expertise in housing operations, property development or management, business management and the like. It was announced in October last that, in recognition of the need for service spouses, as the people most affected by decisions regarding service housing, to have a direct input into the making of those decisions, the Act would be amended so that a service spouse could be appointed to the Authority. The Bill amends the Act accordingly and also provides for an extra appointed member who will bring additional financial expertise to the Authority. Subject to passage of the Bill, an announcement will be made later regarding the persons to be appointed. The last group of amendments relates to the bringing into force of amendments made to the Defence Act 1903 and the Naval Defence Act 1910 by the Defence Legislation Amendment Act 1987. These amendments introduced the concept of open-ended or permanent enlistment to retiring age for soldiers and sailors as an alternative to the traditional system of successive fixed term engagements and re-engagements. Under the new system, permanent enlistees will be able to claim discharge short of retiring age by giving appropriate notice. This right is subject to certain constraints, particularly a return of service obligation where a member has successfully completed a course of training. Planning for the introduction of the new scheme in July this year has revealed a need to clarify the references to the courses concerned, and the Bill therefore amends these references. The Bill also includes similar amendments to corresponding provisions related to officers' resignations. To avoid possible misunderstanding, I should emphasise that these legislative changes do not foreshadow a more restrictive approach to voluntary separations from the Defence Force. So far as soldiers and sailors are concerned, the change is one of fine tuning the new permanent enlistment scheme. This has been widely welcomed in the Defence Force for the greater certainty it gives to members in their career planning and the significant reduction it will bring in administrative effort. With regard to officers, the amendment will enable return of service obligations to be more clearly specified, particularly where initial training is concerned. Financial Impact Statement It is estimated that the fees and travelling expenses of the two additional members of the Defence Housing Authority will be $10,000 in the financial year 1988-89 and corresponding amounts in subsequent years. The other amendments have no direct financial implications. I commend the Bill to honourable members and present the explanatory memorandum to the Bill. Debate (on motion by Mr Connolly) adjourned. Debate resumed from 20 April, on motion by Mr Dawkins: That the Bill be now read a second time. Mr DEPUTY SPEAKER(Mr Mildren) —I understand that it is the wish of the House to debate Supply Bill (No. 1) 1988-89 concurrently with Supply Bill (No. 2) 1988-89 and Supply (Parliamentary Departments Bill) 1988-89. There being no objection, the Chair will allow that course to be followed. Mr PEACOCK(Kooyong)(8.57) —We are debating tonight Supply Bills (No. 1) and (No. 2) for 1988-89 and the Supply (Parliamentary Departments) Bill 1988-89. These Bills make interim provision for the appropriation of money out of the Consolidated Revenue Fund for the services of the Government for the first five months of financial year 1988-89. The Opposition will not be opposing these Bills, as they form an integral part of the budgetary process. But while we are not opposing the Bills, the coalition reiterates its dissatisfaction with the Government's continued refusal to curb Government outlays significantly. To highlight this I now move an amendment, which will be seconded by the honourable member for Bruce (Mr Aldred), as follows: 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 notes: (1) Australia's $86.77 billion net foreign debt at the end of December 1987 and its continuing balance of payments deficit on the current account which increased by $1185 million during March 1988; (2) the Government's inappropriate response, which has been to increase taxation revenue collections to the highest levels in post-war Australia; and (3) the urgent need to reduce public sector outlays as the major element of a Government policy response to Australia's current economic difficulties'. I expect that shadow Ministers and other Opposition members will discuss detailed aspects of these Bills and their effects on individual portfolios. However, in line with this amendment, I wish to address my remarks to the state of the Australian economy. This financial year, 1987-88, the Government is likely to run a Budget surplus of $1 billion. I project that the Budget surplus for 1988-89 will be at least $3 billion, certainly if there are no policy changes. The Treasurer (Mr Keating) constantly congratulates himself on this so-called feat of fiscal management. In reality, this feat is nothing more than a facade. As Senator Walsh commented shortly after the Budget was brought down in September last year-indeed, at the end of the very week in which the Budget was brought down-the Government lacked the political courage to cut spending significantly. This year's Budget surplus stems largely from the proceeds of asset sales, and particularly from revenue resulting from bracket creep. The Treasurer at his Press conference last week made it perfectly clear in stating the obvious: if we get a surplus on our Budget, we get it either by cutting expenditure or by increasing the revenue. There has been precious little fiscal constraint-namely, cutting of expenditure-but there have been extraordinary amounts of revenue increases, particularly by PAYE taxpayers, who time and again have moved up because of bracket creep. Ask any Australian. One does not even have to ask them now. Just look at the result of every election that has been held this year and see the way in which the people have traduced this Government in the ballot box, in the only effective protest they can make. So there is a political need for the Government to change course, but it cannot see that; and there is an absolute economic need to reduce the crippling burden which is overshadowing the lives of most Australians, as they struggle just to keep afloat in any given week, and to deal with the current state of the economy and its impact on the average family. Let us take an example. This is not mere rhetoric. In September 1985-2 1/2 years ago-the tax paid by a person on average weekly earnings, with a dependent spouse and two children, was 18.8 per cent of his income. By November 1987, with all this talk of the Government's tax cuts and how effective they allegedly were, the tax paid was 20.8 per cent of total income. Over this period the tax paid by a person on average weekly earnings increased by $22 a week. This Government, through its Treasurer, has the hide to say to Australians, `I personally, by a magic feat of statesmanship, have brought about this balanced Budget and indeed this surplus'. It has been brought about by screwing down the take-home pay, the money, the disposable income, of the majority of Australians. That is not something worth congratulating oneself on. It is worthy of the utmost condemnation. There is a wider issue at stake which I shall come to in terms of the whole macro-economic scene so far as Australians and their own economy are concerned. Despite the so-called tax cuts of December 1986-can honourable members remember them? Mr Rocher —Hardly. Mr PEACOCK —And of July 1987, the tax burden for many average families has actually increased by $22 a week in the last couple of years. Yet at the EPAC meeting last Friday the Treasurer described his changes to the tax system as `landmark reforms'. Tell that to the marines. Labor's recent electoral disasters I have just touched on. They provide ample evidence that average Australians are feeling the squeeze. I am now into my twenty-third year in this Parliament-I have been here longer than any other Liberal-and I can tell the House that in my period representing what is frankly a middle class but generally affluent electorate, my electorate office has never before been filled with so many people who are finding it damned hard just to stay afloat. Mr Rocher —The same here. Mr PEACOCK —I am very grateful to the honourable member for that interjection. As I discuss this, even in casual conversation, with my colleagues I discover that their offices also are inundated, and that is corroborated by the way in which people are voting. Of course we get some pleasure out of doing well electorally, but I would rather be getting that pleasure for some other reason than the fact that the Government is squeezing Australians in a manner that has not occurred before, certainly not in my nearly quarter of a century in this Parliament. I do not think honourable members opposite are aware of it at all. I do not think they comprehend what they are doing to people. Notwithstanding the fancy rhetoric that some people go on with about the progress that is being made in this nation, it is progress for only a few people. Improvements in life are at present being experienced by a very few people. There is no doubt that the Government is dividing the Australian community even more into the categories of those who are getting wealthier and wealthier, those at the other end of the spectrum, the poor, who, while being crushed, are nevertheless being helped by various welfare handouts, as ought to be the case if they cannot cope, and then the great bulk of people within this great country of ours, in middle Australia, the overwhelming majority, who are finding it difficult just to cope with their daily lives, due to the heavy imposts. The Government has looked after the extremely wealthy, who have been able to thrive at the expense of the bulk of Australians. Two weeks ago the Prime Minister (Mr Hawke) said that Australians could now expect improvements in wages, in taxes and in the inflation rate. Last week the Treasurer suddenly became rather vague about tax cuts. He berated me, the Opposition and the Business Council of Australia, for pointing out that we must exercise fiscal restraint, that we have to cut down our spending so that we can give some tax cuts to the majority of Australians. We were berated for saying that, but by the end of the week, when yet another disastrous month's trading figures came out, the Treasurer resumed his more meek and mild mould, which is rarely seen, and adopting that pose he said, `Well, we will have to be fiscally responsible.' The Treasurer became vague about the tax cuts, saying that scheduled tax cuts would not be announced in the May statement. The verbiage that is used about tax cuts is to the effect that Australians will get their tax cuts in the life of this Parliament. However, what does that mean? It means that the Government will not deliver the tax cuts now, when they are needed, near the end of this financial year, and it will not announce tax cuts in the next financial year in the Budget-or foreshadow them in May. It is more than likely that the Government will apply them at the end of the next financial year or early in the following one-just as the man who would be king, the current Treasurer, replaces the present Prime Minister, becomes Party Leader and Prime Minister, and contemplates an election at the end of 1989. So, there is this extraordinary vision in the Treasurer's mind that the tax cuts can be given some few months before he calls an election at the end of 1989. That will not rub. People are not mugs. They will not be duped by this sort of political fancywork. They are hurting, under a government that promised them a reasonable deal, although it has simply shovelled out opportunities for people at one end of the spectrum, and not for the bulk of Australians. Members opposite pulling that little act will not remain on that side of the House. I think it is fairly certain that they will not be, in any case, but what would be a disaster for them at present would turn into a rout. I do not want to dwell on the political consequences of it, as that is down the line, but it is the economic consequences that will bring about that political disaster on which we ought to be focusing and which I am seeking to draw attention to in speaking to these Supply Bills presently before the House. Referring again to some quotes, last weekend the Prime Minister promised significant personal income tax cuts next year in the context of a wage tax trade-off. I think that the Prime Minister, in talking along these lines, is missing the point altogether. It is imperative in the view of the Opposition that the tax cuts be introduced without further delay. It is imperative that the Treasurer announce and seek to implement those tax cuts under the May statement to redress the insidious effects of the tax system as it operates at present and to provide significant real cuts in the tax burden. What do we see apart from what I have referred to? We see the Government busily negotiating deals with the trade union leadership. The Government's total confusion in relation to tax policy was illustrated once again on the weekend when the Minister for Employment and Education Services (Mr Duncan) in a speech to the National Conference of Young Labor said: I believe we must face up to the hard issue of increasing tax revenue . . . Let me remind those who are listening to this broadcast what the Minister, who will hold a seat in Adelaide for the remainder of this Parliament and no longer, advocated in a climate of oppressive tax burdens. He said that the tax revenue ought to be increased even further. We have questioned the Minister in the House about that statement and he simply says that the Prime Minister has talked to him about the issue and that he will say no more. He has not negated; he has not stepped back from what he has called for and yet again we see that element in the Labor Party that wants to soak more and more out of the majority of Australians. This is leading to a state of chaos within the Australian Labor Party, and that is hardly encouraging for most Australians who have seen and felt their living standards eroded over the past few years. Indeed, they must be asking, `Where is the Government's tax policy?' I have listened to the Orwellian chant of `four legs good, two legs bad' from honourable members of the Government side who ask, `Where is the Opposition's tax policy?'. Mr Martin —A good question. Mr PEACOCK —We went to the election with a tax policy, brother, which is more than the Government did. The only time the Government had a tax policy was when the Prime Minister was confronted by a Perth radio announcer in the 1984 election campaign who suggested that there be a tax summit. So desperate for something to hang on to, the Prime Minister picked up the suggestion. Since then the Government has not had a tax policy. Honourable members opposite would not know what the Government is going to implement. Not only is there no policy in place but there is an oppressive effect of the Government's administration at present. Honourable members opposite have waffled, shuffled and moved about with various undertakings as to who will benefit. Will it be business? What will be the level of cuts? Will personal tax cuts be implemented at the same time? We do not know the answers. The only thing Australians know about the Government's tax policy is that it is bleeding them, and bleeding them hard. And for what purpose, I ask. I do not see that people are gaining as a consequence of the soaking in which the Government is indulging at present. As I said, people must and should ask and understandably are asking, `Where is the Government's tax policy?' The bottom line is that Australians deserve tax cuts now. They do not deserve the deceit and the camouflage of the verbiage they hear when the Government says that there will be tax cuts some time in the life of this Parliament. They deserve tax cuts now, and they are demanding them as effectively as they can. As I have emphasised in previous speeches to the House, the fall in living standards that the great majority of Australians are suffering is the direct result of two factors, which are entirely within the Government's control-low productivity and high taxes. Last year productivity in this nation actually decreased. The Government intended to negotiate part of the wage increases on the basis of increased productivity. Wages have increased all right but those increases have not been offset in terms of productivity. Productivity actually fell, and this year it might increase marginally at best. I wonder whether honourable members opposite know what is the estimate for increased productivity for the nation. It is 0.5 per cent. Low productivity is directly related to the dismal level of investment in plant and equipment that has caused our capital stock to deteriorate. Consequently, much of our labour force is working with depleted and outmoded equipment. It is hardly surprising when we consider that labor's high taxes reduce the incentives both to work and to invest, thereby limiting employment opportunities. Yet on top of the disincentives caused by its tax regime, the Government persists and persists in supporting a wages system which blatantly disadvantages the unemployed and which results in dangerously high rates of growth in unit labour costs-far above those of our major trading partners. The damaging effect on our international competitiveness is clear. Although nominal wages continue to grow, they are eaten away by high inflation. One is on the escalator: up goes inflation, up goes the wages; as the wages go up, the benefits are eaten away again by further high inflation. Mr Rocher —Bracket creep. Mr PEACOCK —I am glad that my colleague refers to bracket creep. As I remarked some weeks ago-the honourable member may not have been here-I always used to refer to `tax creep', until one day someone said, `Stop referring to the Treasurer in that personal manner. Stop calling him a tax creep'. So we will get back to bracket creep all the time, but it is creeping away and eroding real wages. Mr Martin —You eroded them. Mr PEACOCK —How long has the honourable member been in this Parliament? Mr Martin —Long enough. Mr PEACOCK —However long that is, I think that this is the first time I have heard the honourable member utter a sound. I welcome that interjection. The only reason I respond to it is that, apart from the fact that the honourable member is hardly a statesman-like character whose name is on the lips of all Australians, I wish that his contribution would be additional to mere interjections in my speech. Maybe the honourable member can give some support to a depleted government at this stage. The Government's support for flat across the board wage increases has resulted in a narrowing of wage differentials, and therefore has further inhibited the responsiveness of the wages system. Obviously that means that it is more difficult for young people and apprentices to find work. On the subject of wage differentials, in every international study that has been done one finds that the closer the relationship between the adult wage and the junior wage, the greater the degree of youth unemployment. It is a harsh reality. Unless one can start to break this crazy concept of narrowing differentials, the young, in terms of unemployment or apprenticeship, will find it too difficult to find work. The youth unemployment rate, as proof of that, is up around 20 per cent. This Government, this political party, sought to pitch its appeal to young people and put them in the work force. Yet in this nation of ours 20 per cent of the young are unemployed-that is, one in five young Australians in the labour force simply cannot get a job. If one adds these factors to our huge and growing foreign debt, which has quadrupled since Labor has been in government, it is clear, to put it mildly, that the economy is in appalling shape. This is the economy which, nearly two weeks ago, the Prime Minister and the Treasurer were happy to describe-glory be!-as an `economic miracle'. We had our friends from the Confederation of Australian Industry on the loaves and fishes job talking about Lazarus. Lazarus has been looking a bit sick again-he has been recycled into the other state-since those trade figures came out, but it was referred to as an economic miracle. When accurate analyses are given, such as that which I am giving tonight, one is constantly amazed at the hyperbole which is injected into the Prime Minister's and the Treasurer's rhetoric. But there was that remarkable turnaround late last week when the trade figures came out and the Treasurer had to concede that the economy is, to quote him, `running just a little too fast'. What does that mean? It means that the pace of adjustment of our domestic policies in the face of these external imbalances is just too slow. It is worth remembering that in this year's Budget Papers the Treasury acknowledged that. The Treasury said: . . . the longer the adjustment period, the greater is the build-up in foreign debt and the greater the call on future income to service that debt. Prolonging the adjustment period also means greater vulnerability to further shocks that are adverse to Australia's external performance. The Treasurer, in talking about the economy either being overheated or running just a little too fast, is joining the ranks of the Opposition-which has constantly called for a faster pace of adjustment-Moody's Investor Services, Senator Walsh and the Treasury in his concern about the inadequate pace of adjustment. As yet, the Treasurer is all talk and no action. By refusing to force the pace of adjustment and adopting what Moody's has described as a `gradualist' approach the Government has imposed huge economic and social costs on Australia, and the tragedy is that these costs could have been significantly reduced. Reductions in government spending are not being called for as some debating point. They are not only being called for to provide tax relief for millions of Australians; reductions in Government spending will also move resources from the public sector to the tradable goods sector-our exports and import substitutes-thereby providing scope for us to trade our way out of our huge foreign debt. That axiomatic point seems to be overlooked constantly by so many members of the Government. Not only does a small public sector result in the more efficient production of goods and services throughout the economy, but smaller government clearly means less tax. Tax cuts increase the incentives facing individuals and businesses so that work effort and investment, and hence productivity, are increased. Labour market deregulation offers scope for substantial improvements in the flexibility and responsiveness of labour markets through enterprise level wages negotiations so that wages are determined by economic factors. It is about time we started to remind ourselves that wages ought to relate in some way to economic factors-not to deals worked out in the back rooms of Parliament House or trade union headquarters between the Treasurer, the Minister for Industrial Relations (Mr Willis) and the trade union movement. In this way, employment opportunities can be significantly enhanced, particularly for youth and the unskilled. Honourable members opposite know the deals done on the wages system. They know how figures are peddled around here and worked out as a deal. They know as well as I do that the leadership of the trade union movement could not give a wit about any unemployed in the community. They are not voting for the trade union movement. The trade unions are interested only in their constituency-the shrinking number of employed in the trade unions. The unions stitch up a deal with the Labor Ministers that will be a politically acceptable package to roll before the Australian Conciliation and Arbitration Commission to get endorsed, instead of those wage increases being related to increases in productivity so that we can see some real advance. Dr Charlesworth —Do you believe that? Mr PEACOCK —Not only do I believe it, I see it being acted out. What I am saying is quite apart from the reforms that the Government has hinted at in terms of the micro-economic area, which I could have dealt with in some detail. After the last election we were told that the third term of the Hawke Government would be the term of micro-economic reform. The micro-economic reform we have seen to date has been the rhetoric emanating from various factions that cannot even get together on a concept of privatisation. The Government's privatisation program is chaotic. Deregulation in other areas cannot be agreed upon, and we are still waiting for details elsewhere. Genuine-and I emphasise that-micro-economic reform, including what I was touching on a moment ago, namely, labour market deregulation, the abolition of rationalisation of business regulations, the privatisation of certain government enterprises and improvements in providing infrastructure can significantly increase the productivity of the nation's resources. These policies together would offer the potential to increase investment, increase productivity, and increase employment opportunities in the economy. They would improve the efficient operation of the economy and-and this is the bottom line with which I commenced my remarks- they would increase living standards for Australians. The bottom line is that forcing the pace of adjustment reduces to a minimum the huge economic and social costs imposed on the Australian community by our foreign debt. Adopting a gradualist approach, as Moody's describes the Government's approach, only serves to prolong these costs unnecessarily. For these reasons, I urge honourable members to support my amendment, which will be seconded by the honourable member for Bruce. I reiterate that the Opposition will not be opposing the Bills, because they are an essential part of the Government's budgetary process; but I point out to the Government that unless it takes a line through the measures pointed to in the amendment and starts to get the macro and micro scene right it will not only continue to impose appalling difficulties on average Australians but also reap the consequences at the next election. Oft times it is said in this chamber that the economic difficulties that the Government is creating will cause offsetting political problems. But from me this is not mere puff because it has been evident in every election that has been held to date, and it has occurred because the Government is hurting so many people, some of whom viewed the election of this Government as something that would give some of them great hope. Some of them voted for the Government but they are now leaving it in droves and voting for us because they and their families are finding that they just cannot cope. If the Government introduced the measures to which I am alluding tonight, not only would it be doing the right thing by the Australian economy but it would certainly be doing the right thing by the overwhelming majority of Australians who at the moment just cannot cope. Mr DEPUTY SPEAKER(Mr Ronald Edwards) —Is the amendment seconded? Mr Aldred —I second the amendment, and reserve my right to speak. Mr MARTIN(Macarthur)(9.23) —Once again it is an honour and a privilege to follow the Pied Piper of Kooyong in the debate tonight. Obviously he has taken the opportunity to read Bob Brown's book Student Economics for years 11 and 12 because in this debate and in a number of others where I have followed him he has used terms like micro-economics and macro-economics. He is still interchanging them so I am not certain whether he fully understands them, but if he can get past the preface to the book I am sure that he will be on the right track. I will address a few remarks to the amendment moved by the Deputy Leader of the Opposition (Mr Peacock). I think it is important that we on this side reiterate some of our concerns about the obvious nonsense that is uttered periodically in this place when the temporary Deputy Leader of the Opposition debates taxation legislation, Supply Bills and other legislation. The Deputy Leader talked about Australia's net foreign debt, how it is growing, and so on; but he continually neglects to mention that most of it is created because of private capital. It is not public capital flowing from this Government or State governments; it is private capital. When we look at the net terms of trade figures recently announced for March, for example, we see that the increase in the volume of imports has come about simply because we are seeing the famous J-curve approach whereby capital is imported into this country so that capital replacement takes place to improve the economic efficiency of Australia's industries, which is something that is long overdue. We have heard the Treasurer (Mr Keating) talk in this place about the fact that when the Opposition left government after many decades it had completely let run down the economically productive elements of the Australian economy, particularly in secondary industry. Import replacement is taking place because the macro scene is such that producers in Australia can now replace some of their older equipment and can compete far more effectively and efficiently in the broader economy. Of course, this will be to the benefit of Australians, and particularly Australian workers. The Deputy Leader of the Opposition always forgets to mention that. Dr Charlesworth —He has no vision. Mr MARTIN —Vision is something that is not in the lexicon of the Liberal Party. He talked about the increase in taxation revenue. We heard once again the tired old furphy that this is the highest taxing government in the history of Australia, and all the rest of it. We must remember, of course, that this has been said by a man who has referred to the recommendations of the Business Council of Australia (BCA). For the benefit of honourable members I will remind them of what it said. It said that there should be further cuts in Government expenditure. It listed a range of options. It mentioned cuts in pensions and in veterans' affairs. It mentioned not only cuts in veterans' affairs but the total elimination of the Department of Veterans' Affairs. I ask the Minister for Veterans' Affairs (Mr Humphreys), who is at the table, how Bill Keys feels about that. Mr Humphreys —And on the eve of Anzac Day. Mr MARTIN —And on the eve of Anzac Day, as the Minister rightly says. I cannot believe that. Cuts in education and in road funding were mentioned. Honourable members opposite must have received as many letters as I have from shire councils, local councils and other groups saying, `Don't cut the road funding any more, fellows, we cannot live without it'. The BCA report says that there should be cuts in road funding. So I take it that members of the Liberal Party-I do not know about the Nationals; they would probably disagree-would say, `Go for it in a big way and cut road funding'. What about nursing homes? Dr Charlesworth —They don't care about old people. Mr MARTIN —They do not care about old people, they do not care about young people and they certainly do not care about the people whom they purport to represent. The honourable member for Kooyong is on the record as saying, `They didn't go far enough'. So we should hack, hack, hack a little bit deeper! Peter Walsh, come on down, this is your chance; go for it in a big way, hack into all of these programs so that there is no Commonwealth financial assistance for any of them! The Deputy Leader of the Opposition, the honourable gentleman who just spoke in such impassioned terms, pleading for living standards of Australians to be raised, has talked about cutting all of these things for average Australians and getting rid of them. He says, `Kick the old people when they are down. Kick the young people. Don't provide any further opportunities for education. Get rid of Austudy and all the rest of it. Come on, let's get into it. You haven't cut enough'. He went on to talk about the fact that he represents-and I love this-the middle class, but mainly affluent, electorate of Kooyong. He talked about the fact that people were coming in to see him because they were finding it hard to stay afloat. I say to the honourable member that the solution is for them to sell the yachts, the Volvos, the Mercedes and a few other things, and they will stay afloat. He can then come over here and talk to people who represent the real Australians, the real working class of this country, and see what has happened. This Government, to its credit, has paid due respect to the people of Australia, the average workers, who have been prepared to make sacrifices because they recognise the economic difficulties which this Government inherited from the Opposition. They were prepared to forgo some wage increases in real terms. In regard to the macro-economic effects they are now saying, `We have got it under control; let's see some benefit'. This Government has rightly said that they will see some benefit. They have made that sacrifice and now they will see some benefit from it. The Deputy Leader of the Opposition-this great spokesman on economic matters-is saying, `We have to have significant real cuts in tax now to pick up these problems'. I am pleased that my colleague the honourable member for Bendigo (Mr Brumby) has come into the chamber because we discussed this issue at lunch time today. The Deputy Leader of the Opposition has forgotten that when the Opposition was thrown out of government and rejected by the people in 1983, it left this country with a 60 per cent marginal tax rate in the highest bracket and a whole series of others. They have all been reduced progressively downwards. At the bottom end of the scale a range of assistance packages, such as the family assistance scheme, have been put into place. Yet he has the hide to tell us that we now have to start making real tax cuts without further delay. He used terms such as `significant real cuts in the tax burden of every Australian'. The honourable member has the hide to come in here and, with all his cheek, talk about this Government not having a tax policy. He levelled a bit of abuse at me. When he said that the Opposition had a policy I asked him, `Which one are you talking about? Are you talking about the consumption tax policy of John Elliott or are you talking about the tax policy that the Liberals went into the 1987 election with?'. I remind honourable members what that policy was all about-$8 billion of unfunded cuts which would have absolutely wiped out the gains this Government had made. What would have happened to the deficit? Did the honourable member for Kooyong mention that? No. He has not yet reached page 2 of Bob Brown's book Student Economics so he has not quite defined the terms. The honourable member then went on to talk about the fact that the Liberals have a taxation policy. When he first came in here he reminded us that there was a very pressing meeting of the Liberal Party to discuss the present version of the tax policy. I ask the House! If the Liberal tax policy is anything like its media policy, we will see so many versions of it that it will be like a Dutch auction. We can take our pick. Will we have a consumption tax? Whatever happened to the phrase `lock stock and barrel'? That was a great phrase. The old capital gains tax and the fringe benefits tax were to go out the window. That was before the honourable member's mate at the table, the present temporary Leader of the Opposition, the honourable member for Bennelong (Mr Howard), looked at the figures and saw that people were starting to pay their fair share of tax for the first time in their lives. He realised that a good bit of money was coming in; it had helped the Government to stabilise the deficit and enabled it to pay for a range of socially and economically desirable programs in the community to help average Australians. So he has gone very quiet about the whole thing. I just ask: what happened to `lock stock and barrel'? Is it still with us or not? The third matter that the honourable member for Kooyong raised was the question of the urgent need to reduce public sector outlays, and that goes back to the question of the Business Council of Australia response which I have already mentioned. I also found the comments of the Deputy Leader of the Opposition intriguing when he said, `Up go the wages, up goes inflation, and so everyone is immediately forced into bracket creep'. The interesting point is that through consultation processes with the trade union movement, this Government has been able to achieve increases in wages which have been economically responsible. On top of that, this Government has supported wage rises which have discounted below the inflation figure for a period. As the honourable member for Kooyong and I have said, people have recognised that they have been making those sacrifices and, as I have said, the Government has recognised that and has indicated that something will be done about it in the life of this Parliament. The honourable member for Kooyong said, `Up goes inflation'. Let us look at the figures again. When his mate the Leader of the Opposition walked out of here he left us with double digit inflation. It will be 6 per cent or less this year, yet the honourable member talks about inflation going up. It is probably on page 4 of Bob Brown's Student Economics-I hope he refers to that as well. Incidentally, Brownie, is writing a new book and it will probably be a best seller. The honourable member for Kooyong then went on to talk about wage increases and how average workers should have a fair suck of the sauce bottle. I put it to honourable members: which party has consistently opposed every national wage increase, with one exception, for the workers of Australia? It is not the Party sitting on this side of the House. It is those opposite. The Liberal and National parties have consistently opposed increases in wages for every hard-working Australian. Yet the honourable member talks about the fact that wages have not been going up enough or that, when they do, inflation goes up. What absolute nonsense. It quite clearly demonstrates that he has no idea of the substance of his subject. A number of people on this side of the House will be addressing more specific issues associated with these Supply Bills. Quite honestly, I suggest that even to consider supporting this tired old amendment that keeps getting trotted out every time there is a debate on taxation issues, appropriation, Supply or anything dealing with economic matters we should certainly think about consigning it to the dustbin where it belongs. It is rubbish. It is written with no thought for what has been done to date. It has been written in the total absence of any Opposition tax policy, or any policy at all. This Government will continue to look at the whole issue of taxation in a business review later this year. The question of personal tax cuts for the average working Australian will also be reviewed. I suggest to the honourable member for Kooyong that he should go back to his office with his speech-writers, who put that stuff together, and perhaps he would do better if he found someone who knows what economics is all about. Mr ALDRED(Bruce)(9.40) —It is with great pleasure that I rise to speak in this debate and to second the amendment moved by the Deputy Leader of the Opposition, my colleague the honourable member for Kooyong (Mr Peacock). Quite obviously from what the Deputy Leader had to say in this debate, we on this side take far more seriously the fact that today we have a gross foreign debt of $115 billion. It is a pity that the people on the Government side of the House do not attach the same degree of importance to that. In addressing Supply Bill (No. 1), Supply Bill (No. 2) and Supply (Parliamentary Departments) Bill which are now before the House, I have to express a particular deep concern about the way in which the Hawke Labor Government is handling a major aspect of the administration of the Australian Capital Territory. There is, without doubt, a concerted and orchestrated campaign, particularly by the New South Wales right wing faction of the Government-I am glad to see that there are so many of them here tonight-to get a casino established in Canberra at any cost. The House will recall that last week, in respect of the Casino Control Ordinance, I asked the current Minister for the Arts and Territories (Mr Punch) if option 3 had been adopted. Option 3, as outlined in a departmental ministerial submission dated 26 November 1987, proposed introducing the Ordinance simultaneously with the casino opening so as to avoid parliamentary scrutiny. For the information of the House, option 1 involved bringing in the Ordinance before last Christmas and option 2 suggested tabling it at the commencement of this current autumn session. In relation to option 3, the Minister said to me in his written reply of 26 April: The option to which you referred was not adopted by the Government. Earlier, on 23 April, a Government spokesman is reported in the Canberra Times as saying that the Ordinance authorising the casino would be tabled before the project began. I think it is important to note that the Minister has not said when the Ordinance will be tabled. In fact, he seems very keen to avoid doing just that. Perhaps I can suggest a reason as to why he is so determined to avoid this matter. In an undated document entitled Structure of the Legislation, Mr K. T. Lyon, a Deputy Secretary in his Department, canvasses the ways in which the Minister can assure the community that satisfactory controls are in place. He stated: If a decision is contemplated whereby a casino will precede the Casino Control Ordinance GALA may provide a vehicle for a lawful A.C.T. operation. Sub-paragraph 5 (1) (b) of the GALA ordinance provides power for the authority to conduct lotteries . . . I will quote again from the same section: This definition would appear to be wide enough to cover all casino table games. GALA is, of course, the Gaming and Liquor Authority of the Australian Capital Territory. The fact that Mr Lyon felt obliged to present to the Minister advice of such a devious nature highlights the lengths to which the Government is prepared to go in its ruthless campaign to get a casino into Canberra. Given that the current Minister has categorically ruled out option 3, as referred to earlier, the fact that option 1 cannot now be adopted and the fact that the time factor specified in option 2 has lapsed, the GALA option seems to be the only method left open to the Government. The bottom line is: do we believe an anonymous Government spokesman, or do we accept that the Minister's aversion to formally stating the Government's method of bringing in the Ordinance is because there is in fact a hidden agenda? The Labor Government puts itself forward as the champion of the environment movement in Australia, yet it has shown not a moment's hesitation in attempting to subvert the provisions of the Environment Protection (Impact of Proposals) Act as it relates to this casino development. In a file note dated 19 November 1987 concerning a meeting with the former Minister, the honourable member for Parramatta (Mr John Brown), Mr Lyon records: The Minister noted . . . that an EIS- that is, an environmental impact study- could not be avoided in relation to this development and that it could take a minimum of 13 months to complete. It was agreed that the Department would provide further advice on this matter particularly concerning the relationship of the provisions of the NCDC Act to those in the Environment Protection (Impact of Proposals) Act. Later, on 26 November 1987, in a minute to the former minister, Mr Lyon says, in part: . . . the requirements of an EIS need to be met either formally, in terms of the Environment Protection (Impact of Proposals) Act, or informally, via the NCDC policy plan process and an independent social impact study . . . It can thus be clearly seen that this self-proclaimed environmentally conscious Government obviously found the provision in the NCDC Act it was looking for. The provision it found has enabled it to subvert the requirements of the Environment Protection (Impact of Proposals) Act, hence the establishment of an informal social impact study rather than a formal EIS. The decision to proceed with the informal process was made despite the recommendation of the Department's Environment Assessment Branch, the experts on such matters, which recommended the more formal approach `since this would better demonstrate an independent assessment'. The reason for the informal process is spelled out clearly in a minute to the former minister from Mr Lyon dated 2 December 1987. Mr Lyon said: It would provide greater flexibility in relation to the structure and management of the inquiry, while maintaining the substance of the legal requirements. In other words, the purported environmentalists of the New South Wales right wing are concerned only with being seen to be maintaining the substance of the law on environmental issues, something they have done throughout their black propaganda campaign on environmental matters whilst in office. As late as 28 January this year, the Department's Environment Assessment Branch, obviously concerned with more than just the substance of the law, was still voicing concern over the informal study. In an attachment to a ministerial submission, it said: . . . at the end of the study, a ministerial decision will be required as to whether the object of the impact of proposals act has been satisfied with respect to the development and casino proposal or, presumably a separate EIS is required. Quite evidently the thought of at least 13 months for a formal EIS, over which the Government had no hope of controlling the management of the inquiry and which would comply with more than just the substance of the law, was enough to discourage it from undertaking this correct course of action. Furthermore, a formal EIS ran the risk of the probability that it would recommend against a casino and the 13 months does not fit in with the very short timetable the Government has for getting the casino up and running. In its arrogant attitude towards the environment protection Act, it seems that nothing has been left to chance in the Government's efforts to get the casino established. The informal social impact study itself has a partisan head, Dr Geoff Caldwell, ostensibly an academic expert on gambling, but, in reality, an overt lobbyist for the gambling industry. On Tuesday last the current Minister told the House that Dr Caldwell had acted as an `independent expert' for the poker machine lobby in Victoria. This is not a true representation of the facts. During that unsuccessful lobby campaign, Dr Caldwell was a member of the poker machine lobby's delegation on 12 May 1981 to the then Victorian Premier, the Hon. Rupert Hamer, which was later severely criticised by the 1983 Wilcox report for presenting the Premier with misleading information. The fraudulent information was actually presented by Mr Vibert. However, if Dr Caldwell was the independent expert the Minister says he was, surely Dr Caldwell would have corrected the information either at the time or within a short period afterwards. Mr Justice Wilcox, in his 1983 report, describes Dr Caldwell as: The principal witness of the Licenced Clubs Association of Victoria (LCAV) in this inquiry in relation to the operation of poker machine clubs. The LCAV, through a front known as the Australian Club Development Association, established by Ainsworth lobbyist, Mr Ted Vibert, was acknowledged as the major proponent for poker machines in Victoria. Indeed, Justice Wilcox says that funding for the poker machine campaign was provided in large part by the Ainsworth organisation which contributed at least $260,000 in the period January-September 1981 alone. Mr Cadman —Disgraceful! Mr ALDRED —Yes, it is disgraceful. Describing the poker machine lobby's campaign, Mr Wilcox says: Overall probably a score of seminars was held. Mr Vibert was the main speaker, usually backed by Dr Caldwell . . . On Tuesday last the Minister told the House that there was no evidence to suggest that Dr Caldwell should not have been appointed to head a study into the impact of a casino. In the light of the evidence demonstrating Dr Caldwell's close partisan links with the gambling industry, the Minister's statement is a mockery. In fact, the whole casino project is a mockery. It is not something Canberrans have sought; it is something the grubby New South Wales right wing of the Hawke Labor Government has sought to impose upon them. Mr JENKINS(Scullin)(9.50) —We have just witnessed in the contribution of the honourable member for Bruce (Mr Aldred) some imaginative and rather creative uses of freedom of information, but I am sure that the Minister for the Arts and Territories (Mr Punch) will well and truly deal with the way the honourable member is conducting a campaign around the issues of the Australian Capital Territory and the proposed casino. I join the honourable member for Macarthur (Mr Martin) in making some comments about the contribution of the Deputy Leader of the Opposition (Mr Peacock) who had the temerity in here today to talk about this Government being in some crisis over taxation. What a cheek. The coalition's tax policy is in great chaos. The Deputy Leader of the Opposition admitted in his speech tonight that the parties that make up the coalition are still trying to work out the toing and froing that is going on between them. The Deputy Leader of the Opposition also talked of the effect that he had noticed on his electorate of Kooyong. Let me tell him something. I think about the effect on my electorate of Scullin, which is a working-class electorate, of some of the expenditure cuts that the coalition is toying with, along with its co-called taxation policy. The Deputy Leader of the Opposition last week indicated that he supported the general thrust of the submission of the Business Council of Australia-a submission that dealt with something like $11 billion-worth of cuts. The Deputy Leader of the Opposition now says that he will be looking at $13 billion-worth over three years. Does he really think that cuts of that magnitude can be delivered without causing any pain to the electorate? He then went on to dismiss the contribution of the union movement to current economic planning. He talked about deals in back rooms of this place and went on to say that these deals had nothing to do with decreasing unemployment. I refer the House once again to a letter in the Australian Financial Review of Tuesday two weeks ago in which Philip Lewis, a senior lecturer in economics at the Curtin University of Technology, referred to a study undertaken by himself and Michael Kirby. He indicated that the accord had helped to increase employment by 8 per cent or 600,000 jobs. As I said in the appropriation debate last week, it can be seen that the economic turnaround has been paid for largely by workers through the trade union movement under the accord. That brings me in this Supply debate to talk about proper economic planning. Since the election in 1983 the Government has developed industry plans in a number of major areas of the manufacturing sector-the steel industry, the passenger motor vehicle industry and the textiles, clothing and footwear (TCF) industries. In many ways, these industries have been the most difficult to restructure. For instance, the textiles, clothing and footwear industries and the car industry have enjoyed amongst the highest levels of protection of any industries in Australia. TCF industries employ between 110,000 and 120,000 people. This constitutes 10 per cent of employment in the manufacturing sector and 2 per cent of total employment. TCF industries contribute approximately 1.4 per cent of gross domestic product. There are approximately 2,500 TCF operators in Australia. While the 11 largest of those provide nearly 30 per cent of employment in the industry, the remaining 70 per cent are generally employed in smaller manufacturing concerns. Since the mid-1970s, the TCF industries have operated behind enormous trade barriers imposed in the face of competition from newly industrialised countries, particularly in Asia. As my colleague the honourable member for Sydney (Mr Baldwin) has observed, the competitive edge achieved by overseas operations is often at the expense of the living standards of those countries' populations. The Government's approach to the TCF industries incorporates a phased and predictable exposure to overseas competition in conjunction with a range of structural adjustments and a cushioning of the short term effects. Specifically, the industry's development strategy combines four programs of support-a raw materials processing program; an industry efficiency program, including programs for increased access to the national industry extension service; plant and equipment modernisation; and international competitiveness incentives. It also provides an infrastructures program and an export development program. These measures are in conjunction with the labour adjustment measures which took effect in January this year which aim to minimise adjustment difficulties by assisting workers to find employment outside TCF industries. The adjustment package includes access to training allowances, vocational training wage subsidies and relocation allowances. The TCF strategy is a success for cooperative economic planning. It highlights what can be achieved when a tripartisan approach involving government, unions and the industry to economic reform is adopted. The Government, industry and TCF unions should be congratulated on their foresight. Let us contrast this approach with the Industries Assistance Commission recommendations last year of a 50 per cent tariff cut after seven years, no labour adjustment measures, no investment incentives, no monitoring authority, and no review of the effects of those recommendations. The Government rightly rejected those recommendations. Central planning is the only means by which the varied interests can be accommodated. Similar outcomes are not achieved by the invisible hand of market forces. The prices and incomes accord is another example of an effective planning and consultation structure. The accord has contributed to an industrial relations record for this Government which is far better than that of the previous Government. Under Labor there has been a 60 per cent reduction in man hours lost when compared with the dark Fraser- Howard years. The Opposition not only would be unable to negotiate an accord with the trade union movement but also it seeks to abandon any form of centralised wage fixing system. Effective economic management would be exchanged for failed ideology. The Liberal Minister for Industrial Relations under Fraser-the honourable member for Goldstein (Mr Macphee)-recognises this to be the case, as he stated to the Melbourne Herald yesterday: I frankly am in no doubt that the wages outcome which has been delivered so far by the Government could not have been achieved by a coalition Government . . . He went on to say: . . . a coalition Government would not have been in a position to benefit from the union movement's improved economic understanding and its willingness to work with Labor in achieving a lower wage outcome. What did he get for his troubles? Today in the Melbourne Age he got a rebuke from the Leader of the Opposition in the Senate, Senator Chaney. I quote some of the words of Senator Chaney as reported in that article: Union leaders now pressing for guaranteed across-the-board wage rises of the order of six per cent plus undefined extras must be regarded as people who have learnt nothing at all. That was the attitude of the Opposition Leader in the Senate-an attitude of confrontation that so epitomises the coalition's indicated policies towards industrial relations matters. Perhaps we should look at a joint statement on participative practices by the Confederation of Australian Industry and the Australian Council of Trade Unions (ACTU) that the Minister for Industrial Relations (Mr Willis) put around last week. That document said: If Australian enterprises and their employees are to meet the challenges which confront them then the emphasis must be on consultation and co-operation and not confrontation. So there we have it from a peak employer body and the peak union body. That is what this Government's attitude has been about-consensus and cooperation. I think that the admission by the honourable member for Goldstein is in marked contrast to the scarcely hidden New Right agenda which dominates the coalition. The approach to economic planning that is evident in the Government's industry plans and in the accord can be extended further. The ACTU-Trade Development Council mission to Western Europe highlighted the general commitment to tripartism, particularly in Austria, Sweden and Norway. Tripartism promotes communication and genuine understanding between parties which facilitates common purpose and cohesion and minimises the adverse consequences of conflict. Compare the industrial relations outcomes in those countries with the dark Fraser-Howard years in Australia. In 1979 Australia lost 780 days per 1,000 employees while Sweden lost 10 and Austria and Norway less than five. In fact, as the mission's report stated, Austria calculates in seconds rather than days the annual average time per worker lost in industrial disputes. Dramatic reductions in the level of industrial disputation are not the only advantages of tripartisanism. As Australia Reconstructed makes clear, the unions have positive attitudes to industry development and industry rationalisation and ensure that the Government pursues active labour market policies to provide a safety net with the emphasis on retraining and education to absorb technological and structural unemployment. It should be noted that the process of tripartisanism itself has reinforced this high degree of reorganisation and sophistication and it has also functioned as an educational and developmental process for all countries involved. Fundamental macro-economic performance has also been better. At the peak of the Fraser-Howard recession in 1982-83 inflation in Sweden and Norway was lower, and in Austria markedly lower, than in Australia. While Australia's unemployment rate soared to nearly 10 per cent, Sweden, Norway and Austria had between 2 and 4 per cent. It must not be forgotten that economic planning is not an end in itself. The fluctuation of macro-economic variables has a real impact on the day to day lives of average Australians. Some 8 per cent of the work force of the electorate of Scullin is employed in the TCF industries. That is the highest percentage of any electorate in Australia. A number of the people there have to go to factories outside the electorate. In absolute numbers, the top three electorates in those industries are Scullin and the neighbouring electorates of Batman and Wills. When I speak in favour of economic planning along the lines of the TCF plan and the passenger motor vehicle plan it is not only a theoretical preference; I know that without economic planning thousands of hardworking Australians in my electorate would have been the first victims of the invisible hand of market forces. Mr CADMAN(Mitchell)(10.02) —Australians are very uncertain at the moment about their future and that is one of the reasons why the Australian Labor Party is suffering such adverse results at the polls. The remoteness and the unconcerted attitudes of the Treasurer (Mr Keating) and the Prime Minister (Mr Hawke) further exacerbate the concern of people in the Australian community. When one tries to examine the cause of their concern one only has to start with simple matters such as interest rates and to make a comparison between interest rates in Australia and those in the rest of the world. Interest rates are the driving factor for most community activity, whether it be operating a bank account or Bankcard, purchasing a home or raising a loan to operate a small business. The Government bond rate in Australia at the moment is running at around 12.5 per cent and in New Zealand it is 14.3 per cent. We head the world with high interest rates. If we look at comparable countries which are trading into similar markets to ours we see that the bond rates in Japan are 4.2 per cent, in the United States of America 8.4 per cent and in the United Kingdom 9 per cent. So Australia is really 50 per cent above the rest of the world in the cost of money, the cost of doing anything. If one must borrow money in Australia, the cost is 50 per cent above that in any other comparable country. The rise in the cost of goods in Australia, the rise in the consumer price indexes, is running at about 7 per cent. In the United States it is 4 per cent, in Japan 0.7 per cent and in the United Kingdom about 3.3 per cent. So on another key factor we see that Australia has a rate double that of comparable countries for the annual increase of the cost of goods and services. Our interest rates are 50 per cent above those in comparable countries, the increase in the price of goods as measured by the consumer price indexes is double that in comparable countries, our foreign debt is $115 billion and we had an adverse balance of trade-we are buying more than we are selling-last year of $1,770m. So far this year our adverse balance of trade is $333 million. We are not earning enough in foreign trade to pay our way. We are borrowing heaps of money. We have a consumer price index which is double that of comparable countries. We have interest rates which are 50 per cent above those of comparable countries. It is no wonder that Australian growth looks like being the same as in comparable countries. However, that growth rate is falsely high because of the huge amount of money we are borrowing and the heat generated by slack Government policies in administering our economy. The Australian growth rate is running at about 4 1/2 per cent. That is falsely high because it is costing more to do things in Australia. We are stoking money into our system which we have borrowed from overseas. The balance of trade is bad news. Put in family terms, what we are doing is living on the never-never. By going into hock to the bank we have decided that our family cannot produce enough from the wages earned by the family and that we need to borrow as well. We have got our groceries on tick down at the store. In fact, we have borrowed for the house, the car, the washing machine and all the rest. We are in an impossible position unless radical changes are made in the May economic statement by the current Government. I do not believe that the Treasurer has the stomach to understand how Australians are really hurting. He does not go to Bankstown very frequently but when he does he goes in his own Mercedes. Members of the Australian Labor Party are not very impressed by his attending branch meetings in a car of that calibre. That just demonstrates his remoteness. He is a silvertail and behaves like one. Mr John Brown —Who is this? Who are you talking about? Mr CADMAN —I am talking about the Treasurer. I am not talking about the honourable member for Parramatta, who is sitting at the table, but the Treasurer. That is the way in which the Treasurer behaves. If we look at what it costs to buy homes around Australia that will give us some indication of what people are facing. We had the share market crash after which people decided to invest in real estate. We are right in the middle of a real estate boom, which I do not think is going to last too much longer. Currently, developers of whom I know can make so much profit on their raw land that they are selling it undeveloped because it is too expensive to build homes on which they can sell at realistic prices. The market is overheated. One only has to look at various capital cities around Australia to see why. In Adelaide housing rents have outstripped those in all other capital cities, bar Melbourne. Rents have risen at twice the inflation rate. The average weekly asking rent for a three-bedroom unfurnished house in Adelaide in December was $134. If we look at Melbourne we see that rents there have shot up at twice the rate of other capital cities. Recent surveys indicate that the asking rent of a two-bedroom apartment has risen by 21 per cent. The rent for a three-bedroom house has risen by 14 per cent. The 16 per cent increase in the price of new dwellings in Melbourne in the last year has meant that many prospective home buyers cannot afford to buy into the Melbourne market. In Sydney, a single income family with two children on average weekly earnings of say $450, after the deduction of tax and the average rent of $267, has to try to live on $94 a week. This is a family on an average income paying an average rent. Any member who represents a Sydney electorate knows that to be the case. It is impossible to pay one's way in Sydney under the policies that have been introduced by this Government. The average rent for an unfurnished three-bedroom house in Sydney is $267 a week. People are forced to pay these exorbitant prices because of the policies of the Government which have created such circumstances as a result of borrowing long on foreign markets and not producing enough to trade out of our terrible trade deficit, by a consumer price index which is double that of the rest of the world and interest rates which are 50 per cent above those anywhere else. That is the result of the Labor Party's policies on the average family. For a person buying his first home in Sydney the lower interest rates over the last few months have helped, but they are being wiped out by the record new home prices that are 27 per cent higher in Sydney today than they were a year ago. Sydney's rents are the highest in Australia. As I said, the rent for a three-bedroom house in Sydney is $267 a week-about $100 a week more than in any other capital city. Other capital cities also have massive rental accommodation costs. The Labor Party has lost its way for the people it is supposed to represent. That is a great shame. In this chamber there is no discussion or debate about what direction Australia should take. The Government has a remote attitude that likes to fiddle with the figures, that looks at the macro-economics-the cigar-smoking syndrome, if I could put it that way. The Opposition knows that syndrome. We have suffered from it. We know how it can destroy a government. This Government is in the process of self-destruction because of its attitudes. The remoteness of the Government from its constituents and their real needs will mean that it will face great difficulty at the next election. Let me recapitulate. The Government's management of the economy has meant that we have borrowed far too much. The cost of goods in Australia has increased by 100 per cent more than the cost of goods in similar countries. The cost of money, which the economy needs to expand, is 50 per cent more than in other countries. No wonder we are uncompetitive. No wonder we are going backwards. No wonder there is deep concern. No wonder the Government will be thrown out at the next election. Dr THEOPHANOUS(Calwell)(10.12) —I seem to be destined to follow the honourable member for Mitchell (Mr Cadman) on a number of issues. I am now following his pretty meagre contribution to economic discussion. Let me say something about the speeches we have heard from the Opposition. All we have heard has been negative and carping rubbish. We have not heard a single positive suggestion about what needs to be done in this country in terms of development. No positive ideas come from the Opposition; there is just carping, negative rubbish. The Opposition will never get into government until it learns something about formulating policies and putting forward positive, constructive ideas about how to resolve whatever problems exist. Any government in any period of history has problems. In this part of the twentieth century in particular all nations have problems, no matter what their political complexion. What we ought to be about is making constructive and positive suggestions about what needs to be done. Instead, we hear negative, carping rubbish from the Opposition. We ought to be putting forward positive ideas about the future of this country. The Parliament should be doing that in a constructive way, prevailing upon the Government to adopt such ideas. That is what we would be doing if we were playing a proper role as a parliament. We would not be hearing the sort of negative, carping rubbish we have heard from the Opposition. In the last five years the Hawke Labor Government has embarked on a program for the reconstruction of Australia. We have been substantially successful. There are some areas of difficulty. But if we look at the Government's record-for example, the creation of over a million jobs in five years, what has been achieved in terms of helping the poor and the needy, and what has been achieved in terms of redistribution and general economic strategy-we see that we have succeeded in a reconstruction strategy. But that does not mean that the task ends there. Now that we have rebuilt the nation up to a certain level after its massive destruction in the last two years of the Fraser Government, which were particularly outrageous in their destruction, we need to look at what needs to be done from here on. We need a constructive development strategy to take us off in the next 20 years. We need constructive ideas from all sides of politics about how such a development strategy should work, and not, as I said, the negative carping that we have heard. I want to talk about elements of such a development strategy. Firstly, there is economic development. Due in part to the negative criticism that we keep hearing, we tend to lose sight of the fact that we are a resource rich country, that we are a nation with a future, and that we can have a lot more economic development than we have at the moment. We can have development in all areas: in resources, in agriculture, in industry, and in services. We have all this potential for the future. Let us talk about those positive possibilities and develop a strategy to achieve them. Secondly, in addition to those positive economic possibilities, we also need a development strategy in human terms. I speak here of the need to develop the population of our nation. We need a population strategy, that ties in with our economic strategy, our industry strategy and our infrastructure strategy. That is possible. Instead of the carping criticism and the negative comments that we keep hearing from the Opposition, we should be hearing constructive ideas about how such a strategy can be developed. There is no question but that we need more people in this country, and in particular, more young people, because the population is ageing very rapidly. In the next 15 years the number of old people will double, and we will have to find more revenue to provide pensions and benefits for them. It is very important in that context that we develop a population strategy. The other reason why we need a population strategy is to help us to develop our undeveloped regions, the vast northern areas that are underpopulated. It follows from that, obviously, that we need a regional development strategy. We need to focus on how we can develop the different regions of Australia, not only those regions where we need people, such as in the north of Australia, but also those regions where we already have people and infrastructure but where jobs have been lost and there is unemployment. We need to direct economic resources to those depressed regions to help employment and to boots infrastructure. Concurrent with that, we need to develop an industry restructuring policy. We need to restructure our industries in such a way that we can export more value-added products, especially high technology goods but manufactured goods generally. We need to ensure that we are importing less by providing import replacements from more and more of our industries. These are real possibilities, and we are working at them. Manufacturing industry, which was decimated under the conservatives-especially in their last two years-has picked up, but we have a long way to go. The Government is aware of this. The Government is putting into place an industry restructuring program, and in the next few years we will see that program being put into place in a dramatic way. It will involve some changes, to establish habits, but it is important that we get industry restructuring going and get these new industries developed. All Australians should come together to assist in ensuring that development and restructuring does take place, because without such structural adjustment we will not be in a position to face the challenges of the future. We have the basic resources, both human resources and natural resources, in order to have that development, but we need to take steps along that road. Together with population development, we need to look at infrastructure development. The honourable member for Mitchell mentioned housing. Of course there is always a need to do more in housing, but we have done a tremendous amount in the last five years in that area and the fact of the matter is that we are prepared and ready to do more in housing but we need the support of those institutions that are funding housing, especially the banks, and we need the support of State governments and the housing associations to help boost housing even further. In addition to that we need to look at infrastructure requirements, such as roads as well as sewerage requirements in the cities and providing basic infrastructural services such as public transport in the cities. Those things are necessary if we are to get development going in the way we require. As I said at the beginning, we need a coordinated development strategy, one which looks at the economic issues, the industry development issues, the population issues and the infrastructure issues. If we put forward such a strategy, we can get the support of the overwhelming proportion of the Australian people. This nation has been based in its 200 years on the concept of development, and that concept needs to be carried further. I believe that it ought to be carried further. Let me say something about a matter with which I am most intimately involved at the present time-population policy and immigration. In the past year we have had the extraordinary phenomenon of a huge boost in the number of people wanting to come to Australia-an increase in demand from one million people in the previous year to 1 1/2 million wanting to come to Australia now. Obviously given that external pressure and given a strategy of development internally, our immigration policy needs to be generous and we need to open our arms. Obviously we cannot allow the whole 1 1/2 million in, but we need to be generous. If we could achieve 10 per cent of that figure and get in 150,000 people a year, that would be the minimum required for a development strategy to really get going. We need this increase not only for the development reasons that I have put forward but also for population reasons, with the ageing of our population as I have mentioned. While our reproduction rate is below zero population growth, we need people and if we are going to get people here, we need to support a balanced and fair immigration program. Finding such a program is not an easy process, especially when we have 1 1/2 million people wanting to come here. It is very difficult. But find such a program we must, and we need to try to work together, to try to sustain as far as possible a bipartisan approach to ensure that we can convince the community as a whole that all these people ought to come here. In order to ensure such an approach we need to balance the various criteria and demonstrate that we are being fair to everyone concerned. Mr BRAITHWAITE(Dawson)(10.25) —The House is taking its time tonight on what are normally called Supply Bills, which appropriate some $10.7 billion in expenditure towards carrying on what we call the supply requirements of this Parliament and this Government. When we are talking about expenditure we must always realise that, on the other side of any budgeting that we do, there is a need for us to raise those funds by means of taxes or in other ways. Over the last five years, until this year's Budget, this has meant that the Australian Government has borrowed considerable amounts of money to put itself further into debt, to assist in increasing the foreign debt that we hear so much about these days. I believe that tax reform in any sense must involve an element of looking at expenditure to see what is real and necessary. The honourable member for Scullin (Mr Jenkins), in his address, challenged the Opposition to say where these expenditure cuts would come from. I do not think it is up to us, as an opposition, to indicate where the expenditure cuts would be made. But it is fair enough to indicate to the honourable member for Scullin, and to the Government, that within the framework of the last five Budgets there are considerable areas that we could look at in order to effect those expenditure savings. What I would like to do tonight is indicate that over the years of the Budgets of the present Treasurer (Mr Keating), and based as a comparison on the 1982-83 Budget which was delivered by the Fraser Government and the present Leader of the Opposition (Mr Howard), the expenditure of the Commonwealth has gone up 63 per cent. Over those five years, the element of inflation has been 36 per cent which means that, in real terms, expenditure under the Hawke Labor Government has gone up by 27 per cent. So when members of the Government say to us, `Where would the areas of expenditure cuts be?', I just go on record to say that, had we achieved a 27 per cent reduction in the expenditures of the last five years, we would have been able to compare one with the other, to indicate that some expenditure reductions were possible. It would not be so bad if we had been able to fund these expenditures that the Government has committed the Commonwealth to with taxes, indirect or otherwise, or any other sources. But we have had to borrow funds overseas for four of these five Budgets, eventuating in a cumulative debt of $23 billion. I worked out some figures for the purpose of speaking on the 1987-88 Budget. They indicate that, had the Government in its time maintained expenditure at just on inflationary rates and picked up those items where expenditure reductions were not possible so it had to inflate, it would have been possible for the Commonwealth, instead of ending up being $23 billion in debt, to have been $21 billion in surplus. So when the honourable member for Scullin comes in here, challenges us and then moves out of the chamber before we can answer, I would like to suggest to him that, had a government, of necessity or otherwise, wished to make expenditure cuts, there was a lot of fat in those Budgets of the last five years where that could have taken place. When one has to borrow to cover expenditure one falls into the trap of raising loans and raising the amount of interest on the borrowings, to the extent today that the Australian Budget carries about 10 per cent of its expenditure by way of just paying the interest on the debt. That is not repaying the main funding arrangement, because what the Commonwealth does is turn it over. But in its own way the Commonwealth has been a major contributor to the $115 billion foreign debt that we have today. What I also have been able to pick up through the appropriation is an additional amount going to the Department of the Treasury and also to the Australian Taxation Office. One of the books published by the Treasury Department, which was made available in December 1987, was Tax Expenditures Statement. Madam SPEAKER —Order! It being 10.30 p.m., the debate is interrupted. I propose the question: That the House do now adjourn. Mr Staples-Madam Speaker, I require the question to be put forthwith without debate. Question resolved in the negative. Debate resumed. Mr BRAITHWAITE —The Tax Expenditure Statement indicates that quite apart from the appropriations that we are approving tonight, within the taxation system is an element of delivery of services other than the main ones the Income Tax Assessment Act proposes, namely, to make a tax on incomes. This book shows that the additional expenditures that went through as tax expenditures for the year 1985-86 were $8.354 billion, which is over 10 per cent of the Budget outlays. In a committee only last week we were able to question the Treasury officials who presented this. The question is not the necessity of this document-because I think it is a very good document, depending on how one assesses the benchmarks-but how it highlights what these expenditures are. For instance, through the tax system we deliver social security and welfare to the extent of over $5 billion, and industrial assistance and development to the extent of $2 billion, and so it goes on. At least they are accountable. but one must ask whether it would not be more accountable if those programs themselves were set up to deliver the services through a funding arrangement which could be properly scrutinised by this Parliament. I mention that because there is a feeling that perhaps we should look at some of these expenditures to determine, first, whether they are tax expenditures. I do not really believe that, for instance, a spouse rebate is a tax expenditure. It is an attempt to deliver a little bit of equity and fairness in relation to a tax system that does not allow a single income family to split its income, whereas in dual income families that can be done. So I think we must keep these figures well in mind. Supply Bill (No. 1) Supply Bill (No. 1) Supply Bill (No. 1) Supply Bill (No. 1) Supply Bill (No. 1) Supply Bill (No. 1) Supply Bill (No. 1) Supply Bill (No. 1) Supply Bill (No. 1) Supply Bill (No. 1) Supply Bill (No. 1) Supply Bill (No. 1) Civil Aviation Bill The honourable member for Burke (Mr O'Keefe) said in his speech that Australia is resource rich. No-one is denying that. Then he threw out the challenge that we should plan and plot the future for the next 20 years. But in assessing the honourable member's comments one would have to take into account the fact that he and other members of the Government would tie up the nation's basic resources. I mention uranium as just one example. It is a philosophical hang-up of the Left that uranium should not be mined or tinkered with. Yet uranium could provide Australia with a sizeable income and economic achievement to redress some of the trade imbalance. That is a basic fact. It does not matter how we feel about it or how members on the Government side feel about it. The honourable member for Burke was talking about resources. He and his Government have tied up a basic resource of uranium. Earlier this year they tied up a basic resource of timber in the rainforests of north Queensland, with the result that the new Parliament House, which we are going to occupy at the end of this year, is going to cost considerably more. Yet the honourable member for Burke had the hide to say that we are rich in resources and we should plan what we are going to do about them. Another resource that we are wasting is labour, while we have an unemployment rate of 8 per cent. That is another resource we could use. I suggest that it is the dead hand of the Government on the economy that is causing the nation's trade imbalance. It amazes me that every time the monthly trade figures discloses a moderate deficit decrease, from, say, $700m to, say, $500m, the Treasurer trumpets that as a fine achievement. Mr Millar-Joy unconfined. Mr BRAITHWAITE —Joy unconfined, and the journalists in the economic sections of the newspapers blaze it as a tribute to the Treasurer and also the glory of an economy that has turned the corner or the J-curve. Yet, in all of this we know that we are steadily ticking up a foreign debt and incurring interest. I suggest that there is a lot that the Government could do. I do not mean to carp, but the Australian business man who wants to trade overseas is not competitive in the face of our inflation rate and interest rates. Our costs are not competitive, nor is our dollar. Our labour market is not competitive with those of other nations. When it comes to corporate taxation and other taxes on business, there is joy unlimited for the Treasurer because he catches more in his net then is caught by those in the countries with which we compete. I think that Government members should look at these matters and perhaps comment on them. Mr HOLLIS(Throsby)(10.36) —It is a great pleasure to participate in this debate on Supply Bill (No. 1) 1988-89, Supply Bill (No. 2) 1988-89 and Supply (Parliamentary Departments) Bill 1988-89. With the approach of May Day this coming Sunday, the day on which workers throughout the world celebrate their solidarity and their struggle for their hard won rights, I want to raise some important considerations that reflect on the state of our national economy, the economic and social well-being of the Australian people and the importance of this Supply legislation. As I stated last week, and as I would now like to reiterate, it is quite fashionable in some circles, not least the Opposition benches, to blindly attack the Australian trade union movement and to blame workers for every real or imagined industrial problem. While it is quite easy and sometimes downright convenient to make the unions into a national scapegoat, frequently such attacks are without substance, ignore the reality of the situation and present a very one-sided view of a conflict. I would certainly not claim that in each and every dispute the union is always in the right, but contrary to what many people-especially honourable members opposite-would like to think, it is my experience, as a member of the Australian Workers Union and a former delegate to the South Coast Labour Council, that the trade union movement is largely made up of responsible members and leaders who care not only about their own wages and conditions but also about the state of the economy of our nation and the well-being of its citizens, especially the battlers and the disadvantaged. Under the leadership of, first of all, Merv Nixon and, more recently, Paul Matters, the South Coast Labour Council has had a long tradition of being actively involved in a whole range of worker related issues that extend well beyond the customary role of seeking better wages and improved conditions. I find it most significant that a local opinion poll conducted in 1986-to the best of my knowledge, the only one of its kind conducted in the region-indicated that 74 per cent of the population of the Illawarra thought that the South Coast Labour Council was doing a good job and had the best interests of the region at heart. It is most certainly my experience in the Illawarra region that trade union leaders and members are generally prepared to sit down and talk before considering stronger industrial action. They see strike action as a last resort, to be used only when all other avenues have been exhausted. Today, however, they are taking the initiative in seeking to develop structures and approaches which, on the one hand, will facilitate better worker-management communication and shared decision making and, on the other hand, will reduce industrial disputation. However, they are most certainly not prepared to sacrifice hard won wages and conditions without getting some tangible returns. The Illawarra has a strong tradition of workers standing up for their rights, and it is only the most prejudiced of people who cannot-or will not-distinguish between what they are determined to see as pigheadedness when, in fact, it is legitimate trade union militancy. The history of the trade union struggle is one of a long and hard fight to achieve the wages and conditions that Australian workers enjoy today. However, the unions of the Illawarra well know that the price of maintaining decent wages and conditions is that one must be eternally vigilant. That is not to say that the trade union movement is not prepared to change with the times. It is quite the reverse: Illawarra unionists have long recognised that we now live in very different economic circumstances from the boom period of the 1950s and 1960s. They understand quite clearly that they must respond to changing conditions and, by and large, they have sought to do so. The South Coast Labour Council and its affiliated unions have, for example, accepted the major thrust of Australia Reconstructed and have taken the initiative in seeking to enter into tripartite agreements involving trade unions, management and the various tiers of government. The advantages of such tripartite agreements are clear. Each of the parties makes a number of trade-offs in terms of improved work practices and management practices, including a greater emphasis on communication between equal partners and negotiation rather than confrontation, and the end result is industrial harmony and improved productivity. The puzzling thing in the Illawarra at the moment is that it is the trade union movement that is seeking the initiative in seeking tripartite agreements and business management that is reluctant to enter into such agreements. The impression I am getting is that management is still reluctant to accept the trade unions on an equal footing and is finding it more difficult than the union movement to accept the challenges of the times and the need for a fundamental change of attitude. Late last year, the South Coast Labour Council began work on a proposed tripartite organisation, a regional consultative council made up of representatives of local industry, government and the Labour Council. It was envisaged that the consultative council would become a central organisation bringing together a number of disparate local employment and industry development organisations and would coordinate and facilitate such development within an overall regional development plan. The proposal met with only lukewarm response from the business sector. The former New South Wales State Government was enthusiastic but the present State Government is, quite predictably, yet to express an opinion. The Labour Council is now looking to the Federal Labor Government for support and a meeting is scheduled for next week with local Federal members of Parliament. Undoubtedly, the most successful tripartite organisation to date is the Port Kembla Harbour Task Force. This was formed in 1981 on the initiative of the maritime group of trade unions which had identified as a serious problem a steady decline in regional maritime activity. The unions commissioned the Wollongong Workers Research Centre to investigate the problem. The Centre's report, The By-Passing of the Port, analysed the decline in activity and proposed a counter-strategy, out of which grew the Port Kembla Harbour Task Force. The efforts of the Task Force, under the leadership of its Chairman, Peter Morton, were instrumental in placing the New South Wales Grain Handling Authority's third grain terminal in Port Kembla. The terminal, due for completion in 1989, is the largest development project currently under way in any New South Wales port. The objective of the Port Kembla Harbour Task Force is to facilitate the diversification of the port. Currently it is working on developing exports of horticultural products, live animals and frozen meat. Just 12 months ago, the Task Force organised a forum at Orange entitled `Industrial Understanding-the future of Australia', which I was privileged to attend. The forum established the Central West Task Force which consists of government, farmer, trade union, industry and small business representatives. It is through such practical initiatives and cooperative structures that many of the mutually held misconceptions and artificial divisions between farmers, small business and trade unions will be overcome. Another tripartite agreement was recently reached involving the South Coast Labour Council and the Shellharbour Municipal Council which embraces much of the Throsby electorate, including the economically depressed area of Warilla. The two councils are committed to working together in promoting industry and employment development in the municipality, in promoting training and skill development programs, in ensuring industrial harmony through accepted dispute settling procedures and, finally, in safeguarding the natural environment. On the face of it, it would seem that the Illawarra union movement is far more willing to modify work practices than business is to modify management practices. Much of the problem seems to lie in the area of middle management where we find some superintendents with a very fixed view on how to relate to workers and union delegates. For example, the recent very costly strike in the slab casting section at the Broken Hill Proprietary Co. Ltd (BHP) might well have been avoided had the foreman followed recently established dispute settling procedures. The problem became worse when management refused to accept the recommendation of the New South Wales Industrial Commission that the sacking of a particular employee was too harsh a response to his refusal to handle a ladle he claimed to be unsafe. In recent years, there has been much talk of the need to implement total quality control, an approach pioneered years ago by Japanese management. A large part of the problem in developing this approach in Australian industry is the inability of conservative middle management to involve workers on the shop floor in honest discussions on ways and means to improve quality and productivity. Management, it seems, dabbles with the idea and then shies away. Ultimately, of course, the responsibility rests with top management, which has the responsibility of implementing improved managerial practices. At the heart of this problem, and many related industrial problems, seems to be the extreme reluctance of Australian management to move towards a greater level of industrial democracy and genuine worker participation. Illawarra unionists point, for example, to the practices in large steel mills in West Germany and other Western nations. In a modern steelworks with its sophisticated technology and multiskilled work force there is, they say, no alternative but to introduce a form of industrial democracy commensurate with the workers' enhanced skills and responsibilities. Management in West Germany sees this as an important component in ensuring increased productivity and competitiveness. Australian management apparently does not. They say that, especially in the case of BHP, recent changes in the consultative process have been largely cosmetic. While the lines of communication have certainly improved, the effect has been simply better to communicate managerial decisions to the workers on the floor who are asking when they are going to have the chance for some genuine input. One unionist with whom I spoke recently said that not only does BHP have a managerial crisis on its hands in handling its technology; it also has a crisis in handling its work force. The West German experience would seem to point to the two problems being very much interrelated! To quote from the 1987 annual general report of the South Coast Labour Council: Essential to a constructive program of industrial democracy is the two-way flow of information. Two major factors have been identified as contributing to high industrial disputation levels; first, the lack of job security due to unclear management strategy and, second is the lack of constructive consultation and negotiation between workers (their unions) and management. Last week I was accused by a BHP spokesman of not looking at the facts behind BHP's decision to shed 2,600 jobs by the end of this year, with an overall loss to the Illawarra of between 5,000 and 7,000 jobs. I presume that the facts to which he was referring were, firstly, the decision-made in BHP Melbourne head office-that BHP Australia will not subsidise the expansion and modernisation of its steelmaking division at Port Kembla; and secondly, that BHP Port Kembla cannot afford to pay the interest on the money it would consequently have to borrow from an external source in order to build a new No. 4 blast furnace and thereby increase productivity. I said last year, and I repeat it now, that I am appalled at the decision of BHP's head office in Melbourne that leads inevitably to the loss of so many jobs in the Illawarra. The BHP empire has made enormous profits in the past from its steelworks at Port Kembla. Those profits have gone to finance the further expansion of that empire within Australia and overseas. Now the people of the Illawarra are being told that BHP profits today will not be used to expand and modernise its Port Kembla steelworks. Mr TUCKEY(O'Connor)(10.47) —Although I wish to talk of matters contained within the Supply Bills that are before us tonight, it is worth reminding the honourable member for Throsby (Mr Hollis) that it does not seem that long ago that there was a major strike in the district to which he referred which was to do with State workers compensation arrangements. Mr Hollis —I did not mention that at all. Mr TUCKEY —The honourable member did not mention it, and he failed to point to the sort of effect that would have had on the viability of the employer. Many of those people would have been on strike without being willing to be there and because of the pressure of their union bureaucrats. I notice that in schedule 1 of Supply Bill (No. 2) there is reference to expenditures within the responsibility of the Minister for Community Services and Health (Dr Blewett), and in particular expenditures relative to the public hospital system for which I have responsibility in the Opposition. One of the interesting things is that we are spending some money on `waiting list assistance programming'. This amount was earmarked last year primarily when the Government promised over a three-year period a matching $50m grant which in some way was to address the problems presently facing about 100,000 Australians, who under the Medicare system can no longer get into a hospital when they have severe health problems. These problems might not kill them tomorrow, but certainly they will affect their lifestyles and their opportunity to enjoy a proper life as others are able to do. There are people who, for instance, have arthritic joints and need hip joint or knee joint replacements. From the Newcastle area, an area which recently indicated to this Government its dissatisfaction, a gentleman wrote to me some time ago pointing out that the Government now provides him with an invalid pension because hospitals are unable to find the time to operate on his injured leg. The whole point is that these people are also suffering-- Mr Hollis —Were the surgeons on strike? Mr TUCKEY —I hope that the honourable member is not being flippant about the worries of these people. I am sure that even he knows that waiting lists have become a scandal, because in the Government's own schedule of expenditure some money is provided to deal with that problem. Consequently, the Minister for Community Services and Health is writing to State Health Ministers, telling them of some proposals he has for next year. Such proposals are of great interest because he suggests an additional $1,989m will be addressed to Medicare compensation grants. That is nearly $2 billion additional money, but then the Minister points out that the total expenditure will be $3,063m. I added up what the Government has in this year's Budget for expenditure on hospitals, and I find that there are identified health grants tucked away in the general purpose funding for the States of $1,783m, and within the actual health budget the payment for hospital services is $1,685m-a total of $3,478m, which is about $400m more than the Minister is suggesting that he will pay this year. I am not sure whether the Minister is suggesting that he will maintain the identified health grants that are hidden away in the general purpose grants. By hiding them in that way, health expenditure, which appears to be about 10.5 per cent of Budget expenditure, is closer to 12.8 per cent of Budget outlays this year. I do not think the Minister proposes to leave that other money where it is. I am interested to know just what he will in fact do for the hospital system. Furthermore, whilst the Minister carries out this program, he also tells the people in his communication that, unless they are prepared to take 53 per cent of Medicare patients, he will deduct money from those States. That is laudable in one respect, but it only identifies the problem of the Minister. Also published in the Age yesterday was a copy of a letter that also came into my hands from a hospital administrator, saying, `You have to cut back on accepting any more Medicare patients because the State Government does not have any money to look after them'. Hospitals will have to take more private patients because at least they pay between $130 and $150 a day towards the $300-plus a day that it costs on average to run public or private hospitals. The problem is that the Government continues to avoid the real situation. Medicare has failed to look after people who have a low standard of living. In fact, Medicare has created two classes of Australians. There is that class of Australian who can afford to pay the levy and has sufficient other resources to pay for top private health cover. Then there are the rest of the people, and they have to queue up on waiting lists to get into public hospitals because they are either Medicare patients or patients who have the basic private health cover, which only provides rebates roughly equivalent to the cost of admission to a subsidised public hospital. However, the public hospitals are now desperate for this revenue and are putting people further down the list. The other day I quoted to the Parliament-and it is worth repeating-the words of Dame Dorothy Fraser, a highly regarded health administrator in New Zealand. She was one of the three members of the recently concluded Gibbs inquiry into the public hospital system in New Zealand. At page 5 in her prepared address delivered recently in Sydney, for which I was present, she states: The public will identify access as the greatest failing of the present system. She is referring to the New Zealand public hospital system. She continues: Unless you are an accident victim, covered by Accident Compensation or develop an acute condition such as cancer, you join the 50,000 people on waiting lists who need hospitalisation. That is about half the number on waiting lists in Australia. She continues: Waiting lists vary between regions and according to the operation. On average last year the waiting time for hip replacements, kidney stones, cataracts, heart by-pass operations, osteoarthritis, was at least two years. That is exactly what it is here in Australia. She then states: The NZ public hospital system uses waiting lists to ration its services and encounters great difficulty in determining patients' priorities. It tends to respond to pressure from patients, family doctors, politicians or the media rather than develop criteria for priority. Uncomplaining, less articulate and poorer members of society tend to gravitate to the end of queues. Take it from me, that is exactly what is happening here in Australia. It is a perfect explanation. The only difference in Australia is that the Government is not as honest as Dame Dorothy Fraser who says that New Zealand has deliberately rationed health services through the waiting list process. In this country the Government says that it is everyone else's fault. The reality for people who cannot get into hospital is instanced in a letter that one lady sent to the Minister for Community Services and Health; she sent me a copy. She states, `By your process I am compelled to grope around in the dark for the next two years because you cannot address my cataract problem'. It is ironic that Dame Dorothy Fraser also mentioned that problem. It is a problem that the Government appears unable to address. The Government will now try to again put pressure on the State hospital administrations in an attempt to avoid the fact that it has failed dismally to keep the promise that it made in 1983 that it would introduce a universal health program to provide free health services to all Aust- ralians. The Government is now trying to put an additional burden on the States by telling them that they must take on more public patients. It is mainly the Medicate patients, the poor devils who carry a green and gold card which identifies them as poor, who have no choice and very little chance to get out of the system. They must pay a levy to the Government and they have no additional resources to buy private insurance. The Government is trying to force these people into public hospitals by removing some of the private patients. That is not a bad idea in some respects except that the private patients, because of the Government's past policy, can no longer afford the price of a private hospital. How long do we intend to let that go on because, unless private hospitals can attract substantially more clients, their prices will continue to rise. That is not the solution. A well-known trade unionist wrote to me on behalf of his son, complaining bitterly that, firstly, he could not get into a public hospital and, secondly, because he had some private cover, he went to a private hospital. However, it cost him $600 to get out because the fund was not sufficient to cover the cost. The Government's Medicare system has created these sorts of problems and many people are suffering. There is a Commonwealth car driver-and he is only one of a number of examples-who recently borrowed thousands of dollars from a finance company so that he could relieve his pain and suffering. That is the latest phenomenon-people of pensionable age are borrowing money from finance companies so that they can relieve the pain and suffering to which the Government has consigned them through a promise that it could never keep. It is amazing to see the health administrators and others coming forward to tell Australians, not just the Government, that the Government can never keep that type of promise. I thank the House. Mr GRIFFITHS(Maribyrnong)(10.59) —An old colloquialism in Australia goes something like this: `You could have knocked me over with a feather'. I must say that that was my response when I listened to the honourable member for O'Connor (Mr Tuckey), who waxed lyrical and with some outrage about the supposed and inaccurate impact of some of our legislation, in particular on elderly people. My mind went back to the recent endorsement by the shadow Treasurer, the honourable member for Kooyong (Mr Peacock), of the Business Council of Australia (BCA) document that indicated a whole raft of potential spending cuts. I will outline some of those that are of greater concern to me as a member of this House because I believe they will have a significant and adverse impact upon, particularly, the elderly people in my electorate. Before going into details, honourable members will be aware that socio-economic and demographic changes in a number of capital cities have inevitably resulted in a significant impact on housing prices. In some parts of my electorate-most obviously Essendon, but not confined to the City of Essendon-there has been a phenomenal increase in the cost of housing, with the average cost of homes in that area increasing dramatically over a relatively short time frame. Of course, this causes obvious problems in that many elderly folk in areas such as this become asset rich whilst remaining income poor. It was in that context that I was very concerned to see the members of the Opposition had argued explicitly that the spending cuts proposed by the BCA `did not go far enough' and that they were `falling short of the mark'. Let us look at the general impact of a couple of those areas, particularly the abolition of the family allowance. There are many people in my electorate who would be very adversely affected by the abolition of the now means tested family allowance. It is a considerably important component of household expenditure for the middle income earning bracket. The document endorsed by the Opposition also proposed a cut in the Medicare rebate to 75 per cent, a move which would eliminate bulkbilling and mean that people would be charged for every visit to the doctor. That measure would be confined, of course, not only to ordinary wage and salary earners, but to a range of others. The waxing of outrage by the honourable member for O'Connor is thrown into stark relief when we realise that this endorsed document by the BCA also proposes to make pensioners pay more for their pharmaceuticals. Obviously, this is an area that causes great concern and worry, not only to elderly folk but to those who are not in receipt of a regular income but who have a large number of children, and so on. The other point that was raised was a quite cold-blooded one. I know that there are countries around the world that are moving away from the indexation of pensions. This Government has a significantly improved record compared to that of its predecessor in terms of the indexation of pensions to the extent that there has been an 8.3 per cent real increase in pensions over the life of this Government. The proposal to stop the indexation of pensions is a particularly heartless proposal and one that I am sure most members, at least on this side of the House, will ensure does not come to pass. Most honourable members would, of course, have attended perhaps one or more Anzac Day celebrations. I attended probably five or six over the course of the weekend, including the dawn service at the Shrine or Remembrance in Melbourne. Be that as it may, the proposal to abolish the Department of Veterans' Affairs seems to me to be a particularly untimely one, coming as it did contemporaneously with Australia-wide acknowledgment of the contributions of former airmen, soldiers, and Navy personnel and women. Mr Martin —On the eve of Anzac Day, as well. Mr GRIFFITHS —On the eve of Anzac Day, as my colleague has indicated, it was particularly heartless, and is certainly not endorsed by this side of the House. The other proposals, of course, concerned the introduction of tertiary fees and a cut in road funding by $80m. I wonder what the National Party of Australia has to say about the proposal. The reason that I rose to speak tonight relates specifically to the proposal to take into account the place of residence as a component of income-that is, assets-for the purpose of prescribing eligibility for the ordinary pension. Over the past five to 10 years in suburbs such as Essendon and Moonee Ponds there has been a massive increase in the average price of homes but the time frame involved has left many people living in their usual place of residence. Many elderly folk have lived in these houses for 30 to 40 years. Many rely solely on the pension for their income, but, of course, they are sitting in a house which, in some cases, may be worth up to half a million dollars. Yet the BCA proposals indicate a possible level of $200,000 for a house. In Essendon, for example, the $200,000 limit would probably include 30 or 40 per cent of all residences in that area. Because those elderly folk have lived in Essendon for a very long time, they tend disproportionately to own those types of houses which attract the largest prices. We now have a median house value in these areas which is probably around the $200,000 mark-the mark which the BCA has proposed as the cut-in point for taking account of the value of a person's private residence for the purpose of trying to reduce the amount of pension payable to that person. Regardless of politics, in a crude analysis of income and expenditure, it is quite clear that if we took account of such residences, as the BCA document has done-a document which has been described by the Opposition spokesman as not going far enough but which was implicitly endorsed by him-the end result would be to ensure that many people are asset rich, in the sense that they are living in a house worth hundreds of thousands of dollars, but income poor. Those people will have one of two alternatives. They can rely on handouts from relatives or from investments they may have. But if they do not have access to either of those fortunate resources they will be forced to contemplate selling that house after living in the area for many years. They will then have to buy a house in a price bracket sufficiently low to ensure that their pensions are not taken away from them. In the five years that I have been in this House I have tried to ensure that I do not go around improperly scaring people in that vulnerable age group in our community, but this issue should be taken up in this House and debated. As far as courage will allow, Opposition members should dissociate themselves from any suggestions along the lines of those in the BCA document. Looking around the Opposition benches-packed as they are!-I do not see too many people who are prepared to dissociate themselves from the Opposition leadership's endorsement of this document. When one takes the whole raft of these proposals into account-the abolition of family allowances, the cut in the Medicare rebate, which means that people will have to pay for every, and I stress `every', visit to their doctor, the increased liability on pensioners to pay for their pharmaceuticals, the removal of automatic indexation of pensions, the abolition of the Department of Veterans' Affairs, the introduction of tertiary fees and the cut in road funding of some $80m-one finds no great surprise in the fact that the Opposition has been running dead on these proposals. I conclude on this point. The Opposition is continually wont to indicate in this House that the various spending proposals of this Government do not go far enough. I have waited five years to hear the Opposition put up a cohesive program of spending cuts, its own program of spending restraint, in order to ensure that its economic proposals hang together. They do not do that. If the way to achieve that objective is to pick on the weakest and most vulnerable component of our community, then I think that in itself is a damning indictment of the Opposition and its contemporary irrelevance in Australian politics. Mr MACPHEE(Goldstein)(11.10) —I would love to answer the honourable member for Maribyrnong (Mr Griffiths). He clearly is not addressing the Opposition, but he is addressing his own Cabinet, which is on the point of making cuts in its May statement, the famous mini-Budget. In the 10 minutes available to me I do not have time to answer his tongue in cheek remarks about the Opposition. Instead, I want to address myself to the Supply (Parliamentary Departments) Bill, one of the three Bills before the House at the moment. We have allocated $1 billion to a new building for the Parliament. Australians will be very proud of it when they see it physically, but they must also recognise that there is a need for adequate funding for the functioning of the Parliament in that building. There is simply no point in having a building which is not functional. In some respects those of us who have worked in the impossible conditions here know that we are going from the ridiculous to the sublime. Fourteen years in this building has left me without one shred of nostalgia or happy memories, because while I have many memories of different parts of the building, some of triumph, some of frustration, some of good humour and some of bad, I can assure honourable members that the inefficiency with which we have been encumbered by the physical privations, by the invasion of our privacy and by the constant barriers to any kind of consistent, productive output on the part of members of this Parliament has outweighed any good things that I can recollect in it. I look forward with enthusiasm to working in the new building. Having said that, there are some things on which I want to throw out a caution to members of this Parliament. There are certainly great features of this building which the public sees-the exterior, the chambers and King's Hall. Behind the scenes we have a very willing parliamentary staff. Every service department of this Parliament has been marvellous. I especially nominate the Parliamentary Library, which I think is outstanding. The Library of Congress is probably the best library in the world, but I think that the Library of this Parliament may be second. It is quite outstanding. Without the Library we could not possibly do the job that we have been elected to do. I think that the new building presents a lot of challenges. Certainly the staff will be well housed. Their job will be less stressful and they may even improve their efficiency. But what about the role of the Executive arm of government? I have before me an article of which I will quote only a small part, but I commend it very strongly to honourable members. It was in the Times on Sunday, which is a fine production, not least because the Prime Minister (Mr Hawke) did not like it. It is dated 8 March 1987. The article is written by Kate Legge. It is entitled `Behind Closed Doors', with the subtitle `Can the new Parliament change politics?'. As we now have a government which was once committed to open government, but which the more it is in power, the more it is committed to closed government and freedom of information becomes naught, we have a very major challenge to all of us who are striving to do our job as parliamentarians. I quote a little from what Ms Legge had to say: But the building on the hill is more than a roof over the Parliament's head. The vital function of this design, invisible to the public and unexplored by the media, is to protect and entrench the executive: the ministers in general, the Cabinet in particular and, as a special case, in a manner more nearly presidential than all but a few Australians would credit, the Prime Minister. For all the warmth of its welcome, our new Parliament House will contribute not to the responsiveness of government, but to its remoteness. It will have a profound effect on the institution of Parliament, the style of Australian politics, and the scrutiny of government decisions. For the first time in the history of Australian democracy, the executive arm of government will have a home. Ministers and their staff will be housed, aloof, in a separate wing of the new Parliament House on Canberra's Capital Hill. The new wing is located deceptively, at the back, so that the modest back door, not the splendid front, will be the true portal of power. Information-intelligence gathering-is the currency of politics: the door-stop interview, the corridor conversation, the art of sussing out what those in power would like to keep hidden from the public. Scrutinising the executive and its decisions is not merely the task of Parliament; in a democracy it is its raison d'etre. This task consumes the Opposition, much of the government back-bench, and that third arm of executive scrutiny, the parliamentary press gallery. It is hard, grinding, never-ending work and in the new building it will become harder. She goes on to say: The new Parliament is huge. It covers 75,000 square metres, making the construction site the biggest in the southern hemisphere. Getting from A to B will be a hike. People will tend to phone rather than walk; chance meetings will give way to formal appointments. Even the custom of gathering to vote in divisions could be on the way out; provision is being made for the installation of electronic voting panels in members' rooms. I put that to the House. I commend the whole article because it throws up a new challenge for this Parliament. What, indeed, will the impact of this new building be on the role of government? The old and bold like Fred Daly and Jim Killen tell us of the days when one had to have a drink in the members' bar because nobody had a fridge in their room. Members of parliament used to play billiards and travel by train instead of by plane and so on. None of us has time now to fraternise. We will have less time to fraternise in the new building. We are all guilty of this because we are all busy. We are all responsive to subscriber trunk dialling calls and to jet travel which enables us to go away at night to our electorates or to somewhere else. We know each other less and less and we are associating less and less. We are therefore proceeding more and more on paths of misunderstandings. The Prime Minister's isolation in this building is alarming too. The Prime Minister, whoever he or she is, will be only two minutes from the Lodge and will enter the new Parliament House by a special door. At present we have a Prime Minister who launched his election campaign by travelling on the Admiral's barge across Sydney Harbour. Next time, no doubt, he will choose to walk. We have an astonishing situation of isolation. At present when we go down the corridors we can hail or bump into a Minister. We can say, `Look, I was going to write to you about so and so but I want to put it to you now'. It will not be possible to do this when we move to the new Parliament House. We will have to make an appointment to see a Minister. More and more we will cease to do that. We will be fobbed off by Ministers' staff and the Executive will be more and more remote. I think one of the first things we have to do is assert the right of members of parliament to enter and leave Parliament House by the Executive door, by the door that is opposite the Lodge and protected for the Prime Minister, Ministers and staff who are not elected. Capital Hill in Washington is the scene of a constant tussle between White House staff, the staff of the departments and the Congress staff. Here we have a tussle between the Executive, which is the Public Service, the ministerial staff, which is almost the Executive, the back bench staff of both sides, the Parliament House staff, which effectively serves the back bench because it is not used by the Ministers, although it could be, and, of course, the media. These can be very creative tensions and the arrangement may work out very well, but I think it will work out well only if all members of parliament assert parliamentary independence. I think the solidarity pledge of the Australian Labor Party will have to go. It certainly will be under stress if we are to perform our role as parliamentarians. I think we will have to change the Standing Orders of the Parliament, and we flirt with that proposal from time to time. Question Time will have to be improved. We will have to look at the role of House committees and, I suggest, there will have to be more joint House committees. The Parliament we know is under open threat from media magnates at this very moment. This will be resisted. But, increasingly, we will be under threat from an Executive more subtly influenced by other people who are less crass but no less greedy and no less manipulative than the media magnates. In fact, they will be more manipulative because of their skills in lobbying. We have two options in this new building. One is for the Parliament to assert itself over the Executive and be supreme, as the people expect. The other is for its spirit to disappear into the tomb in which it will be physically housed. I cannot imagine any other country in the world building its Parliament House on the top of a hill but burying it inside the hill. It says something about Australia's cringe, but it also says a lot about our general unwillingness to come to terms with the role of Parliament and our capacity to lie down before steam rollers these days wielded by media barons and, through lobbyists, by the Executive, which is to be housed in Parliament House. In this building the head of the Department of the Prime Minister and Cabinet has a small office, even smaller than that allocated to the most junior member of the Parliament. But in the new Parliament House he will be housed in all his glory in offices superior to those of elected members of this place. I said last year that if the Government got its way in further concentrating the ownership of the media, the new Parliament House would be a mausoleum for democracy. At least for the present the Government's plans in that respect have been stymied, or at least arrested somewhat-although not as much as I would have wanted. However, that is another story. The more serious and subtle challenge to the Parliament is from the Executive and those who advise and lobby it. That challenge will be greatly accentuated in future. For years in Westminster-type governments people have spoken about the non-elected elite-that is, the executive. But in the new building we are giving Ministers total isolation. They will talk to each other, to officials and to the lobbyists who go to see them, with their official passes, but they will not be accessible to us let alone the media. That is a real challenge of which we have to be very much aware. In discussing last year's Estimates, or it may have been the Estimates of the previous year, I spoke of the excellent report prepared by the Joint Committee on the Broadcasting of Parliamentary Proceedings with respect to the televising and radio broadcasting of both Houses of Parliament and their committees. I supported the recommendations of that Joint Committee, and I still do so. I do not care whether the programs are run on AM or FM frequency, but I support the idea of continuous broadcasting on a frequency which is set aside only for the Parliament. I do not care to interrupt Australian Broadcasting Corporation (ABC) broadcasts. When there is concentration of media ownership, and of print and television in particular, even of the magnitude we now have, it is very important that people who want access to real information, to what is actually said in Parliament as opposed to the images presented through headlines or through 30-second grabs on television, have a chance to hear and see for themselves. Therefore, I support the parliamentary broadcast unit rather than the ABC preparing material and broadcasting on UHF for television and FM or AM on radio, so that people can hear continuous broadcasts. I support the idea of making available to commercial or publicly-owned stations film and sound so that they can use it as the print media does-that is, edited and open to scrutiny in its own context. I support the report and will do all that I can to ensure that it is adopted in the new Parliament House. I am very glad that the fittings have been installed so that television can be introduced ultimately. The basic right in any democracy is the right to know. That right to know is threatened by the concentration of media ownership. If we can get to the point of actually broadcasting continuously, as well as providing excerpts on television and radio, we will partly overcome the poverty of knowledge which people will experience as the television moguls continue to try to get their way. Finally, I draw the attention of honourable members to an excellent paper produced in the Parliamentary Library by one Greg McIntosh, entitled As it was in the beginning-the Parliament House in 1927. That paper bears reading to consider, as we move into the new building, how things have changed and what it is that impacts on the way we make our decisions. Mr WRIGHT(Capricornia)(11.25) —The honourable member for Goldstein (Mr Macphee) spent a considerable part of his speech talking about isolation in the new Parliament. He also mentioned the need to upgrade the Parliament and I would accept the points that he made about ensuring the supremacy of parliament. If he wants to talk about isolation I suggest he might spend some time in travelling around rural and provincial Australia because that is where the isolation exists. I take the opportunity in this debate to propose the need and seek the support of Government members for a rural provincial Australian strategy. Mr John Brown —In Rockhampton. Mr WRIGHT —Yes, in Rockhampton very shortly we will be holding a consumer conference and the Minister for Consumer Affairs, Senator Nick Bolkus, will come to Rockhampton to talk through with country consumers the problems that they experience. Whilst the honourable member for Goldstein is correct in his argument about the Parliament, I suggest there is need for greater emphasis by this Parliament on the problems that many Australians face. I am talking about not a few Australians but hundreds upon hundreds of thousands of Australians who live outside the capital cities who daily face the problem of distance. Distance creates additional costs. It brings about the absence of Commonwealth and State services. Those costs are also seen in travel, be it the cost of fuel or the cost of purchasing a car. Isolation and distance affect the quality of life in country areas. The quality of housing in many country towns shows that people are not prepared to spend considerable amounts of money regularly to upgrade housing as we do in the cities because there is always the risk that the house will never be sold: it will simply be a rental proposition so the money does not have an investment return. Choice is affected in country areas. I am not talking just about people on rural properties; I am talking about small towns. In my electorate there are some 72 populated areas. When one considers that the electorate has some 78,000 voters it is easy to understand that many of the so-called populated areas are only small areas where there may be only 100 or 200 people. These people face great difficulties. They are confronted with isolation and a deterioration in their quality of life. They constantly see costs go up and their quality of life eroded. They face disadvantages in the social areas-education, recreation and culture. I note that the previous Minister for Sport, the honourable member for Parramatta (Mr John Brown), is in the chamber tonight. He did so much to try to improve the quality of life for young people in the sporting area. He certainly did a tremendous job. He was one of the few who understood something of the problems. People in country areas who want to play sport do not just go along to the local football club. Mr Griffiths —Along with the member for Maribyrnong. Mr WRIGHT —Oh, yes, I would accept that. Young people in these areas do not have the chance just to go along to any club to play rugby league, the greatest game of all. Mr Martin —Absolutely. Mr WRIGHT —I am glad to hear that the honourable member agrees with me on that. Nor do they have the chance to go along to join a local scouting group or girl guide group because the numbers are not there. There may be one or two and if they want to get involved in such activities they travel great distances. Families are disadvantaged because of educational problems, because of distance again. If they want to pursue higher education, it is a matter of travelling great distances. If they want to go on to higher learning they have to leave home and stay away and there are simply not the residential colleges available and, unfortunately, there are not the tax advantages or the assistance available to families to ensure that young people can go on to higher education. It is no wonder that over many years we have had a problem with only 30 per cent of our young people going on to years 11 and 12. Under this Government the figure has been increased to 50 per cent but I suggest that a survey would show that the bulk of that increase has taken place in the cities, not in the country towns, not in rural areas. So we need a rural and provincial strategy to address the problems in country and rural Australia. There are so many disadvantages. One has only to look at the recreational and cultural problems that exist. I think it is time that the decision makers understood this. Over a long period now I have discussed with Telecom Australia the inadequacy of its community access program. It has linked the Mackenzie River area in my electorate with a town called Blackwater. At the same time it has linked a place called Dingo with the city of Rockhampton, my own city. The strange part about it is that the people of Mackenzie River have to go through Dingo to get to Blackwater. I think those in Melbourne simply saw the townships as dots on maps and decided that as the crow flies they were closer so they were included in the community of access area. That has happened with the town of St Lawrence. Telecom has linked the people of St Lawrence with the small township of Sarina. The people of St Lawrence do not deal in Sarina, they deal in Mackay; but again the Solomons of the south have determined that Sarina will be the area of community access. The same thing has happened again in the small townships of Wowan and Baralaba. Instead of linking these people with the township of Biloela, where the local authority resides, or with Rockhampton, where they have all their business, medical and professional links, Telecom has linked these townships with the small town of Mount Morgan. There is a doctor in that town, but no lawyers and very few facilities to service the people of Wowan and Baralaba, which are country areas. The same thing applied when the isolated patients allowance scheme was set up. For instance, if one lives on the Emerald side of Blackwater one is eligible for the isolated patients allowance. If one lives on the Rockhampton side of the post office in Blackwater one is not. Surely there is a need for a different approach. The same is true in every area we looked at, and I mentioned before the education field. Too often people talk about the advantages that governments give. I note that some $32m is being set aside to allow for the higher number of students qualifying for Austudy benefits. Young people in country areas not only need Austudy, they also need residential assistance. Their parents need some tax base to ensure that they can afford to send their children to higher education institutions. I suggest that we need to consider new approaches across this nation. One such approach could be the establishment of a new zoning system, restructuring our tax rebate system to allow people in country areas some financial advantage for living there. I would advocate, as I did a couple of years ago, the restructuring of the zoning system based on local authorities. The greater the distance from capital cities of the local authority areas then the more the rebate should increase; the closer they are to capital cities the more the rebate should decrease. The present system whereby people receive a $90 tax rebate because they live within 250 kilometres of a populated area of 2,500 people is nonsense. If honourable members look at a map of Queensland they will see how ridiculous this is. I have taken the opportunity to raise these issues. I believe there is a need for a new approach. I am concerned at the user pays principle that seems to be developing and permeating the halls of wisdom and power in this nation. It must be understood that if a user pays principle is introduced for Telecom alone people in my country areas will be paying four times the present price for a telephone call. We need to realise that the present rules in regard to sales tax might be inadequate and also unfair. For example, we have sales tax on freight. People in capital cities pay sales tax based on the wholesale price of a commodity. However, people who live in Mount Isa, the far north, or the far west also pay sales tax on the freight component. This should be a warning to those people who support a consumption tax. A consumption tax is a retail tax paid at the point of retail sale. If one were to be introduced people in country areas would pay a special tax on the freight as well. There is a need to redress the difficulties experienced in country areas. There is a need to arrest the deterioration in the purchasing power of people and in their quality of life. I urge that this Parliament act in the next few years to introduce a strategy based on rural and provincial Australia. Debate (on motion by Mr Miles) adjourned. House adjourned at 11.34 p.m. The following notice were given: Mr McGauran to move- That this House- (1) acknowledges the critical importance of Australia's road network to the well being of rural communities and to the economic performance of export orientated industries; (2) recognizes that a deterioration of this national infrastructure is highly wasteful in both human and economic terms; and (3) accepts the need to urgently address the many issues surrounding road funding by the three tiers of Government. Mr Kerin to present a Bill for an Act to establish procedures for examining agricultural chemical products and veterinary chemical products to ascertain their suitability for use in Australia and in the external Territories, and for related purposes. Mr West to move- That, in accordance with the provisions of the Public Works Committee Act 1969, it is expedient to carry out the following proposed work which was referred to the Parliamentary Standing Committee on Public Works and on which the committee has duly reported to Parliament: Construction of radio and orchestra facilities for the ABC and SBS at Ultimo, New South Wales. Mr West to move- That, in accordance with the provisions of the Public Works Committee Act 1969, it is expedient to carry out the following proposed work which was referred to the Parliamentary Standing Committee on Public Works and on which the Committee has duly reported to Parliament: Construction of new Commonwealth offices, Melbourne. Mr West to move- That, in accordance with the provisions of the Public Works Committee Act 1969, it is expedient to carry out the following proposed work which was referred to the Parliamentary Standing Committee on Public Works and on which the committee has duly reported to Parliament: Construction of new Commonwealth offices Haymarket, New South Wales. The following papers were deemed to have been presented on 27 April 1988. Lands Acquisition Act-Statement of lands acquired by agreement authorised under subsection 7 (1). Public Service Act-Determinations-1988-Nos 42, 49, 50, 52, 55, 56, 59, 60. Seat of Government (Administration) Act-Determination-1988-No. 6-Amendment to Determination dated 9 September 1987, and charge for the supply of water for purposes of Canberra Sewerage and Water Supply Regulations. The following answers to questions were circulated: (Question No. 424) Mr Tickner asked the Minister for Employment, Education and Training, upon notice, on 18 November 1987: Is the Minister able to provide details on trends in participation rates for tertiary education by (a) socio-economic class, (b) faculty or area of study and (c) sector: if not, are there any plans to commence research or the collection of data which might provide these details. Mr Dawkins —The answer to the honourable member's question is as follows: (a) The latest information on the relative participation in tertiary education by students from different socio-economic backgrounds is contained in the recent study by the Australian Council for Educational Research, Participation in Education (ACER Research Monograph No. 30). The Commonwealth provided substantial funding support for this study. I have arranged for a copy of the study report to be placed in the Parliamentary Library. (b) and (c) Participation in various sectors and fields of study in tertiary education can be assessed by reference to total enrolment data for each sector. Tables 1.1 to 1.3 and Table 2 provide information for the university, advanced education and TAFE sectors respectively. Table 1.1 STUDENTS IN UNIVERSITIES BY FIELD OF STUDY, 1979, 1982, 1985, 1986 AND 1987(1) Field of study 1979 '000 % 1982 '000 % 1985 '000 % 1986 '000 % 1987 '000 % Agriculture/forestry ... 2.6 1.6 2.7 1.6 2.8 1.6 2.8 1.6 2.5 1.4 Architecture/building ... 3.4 2.1 3.7 2.2 4.0 2.3 4.0 2.2 4.2 2.3 Arts/humanities/social sciences ... 56.6 35.4 56.2 33.7 60.2 34.4 63.3 35.0 61.0 33.8 Business/administration/economics.... 20.4 12.7 22.3 13.4 24.2 13.9 25.2 14.0 26.2 14.5 Education ... 15.4 9.6 15.1 9.0 14.9 8.5 15.2 8.4 13.8 7.6 Engineering/surveying ... 11.4 7.1 13.1 7.8 13.7 7.8 13.9 7.7 14.4 8.0 Health/Medicine ... 12.2 7.6 12.6 7.6 12.2 7.0 12.0 6.7 13.3 7.4 Law/Legal studies ... 9.3 5.8 10.6 6.3 9.9 5.7 10.0 5.5 8.3 4.6 Science ... 26.8 16.8 28.5 17.1 31.0 17.7 32.2 17.8 31.5 17.4 Veterinary Science ... 1.5 0.9 1.5 0.9 1.4 0.8 1.5 0.8 1.5 0.8 Non-award ... 0.5 0.3 0.4 0.3 0.5 0.3 0.7 0.4 4.1 2.2 Total ... 160.1 100.0 166.7 100.0 174.8 100.0 180.7 100.0 180.8 100.0 Table 1.2 STUDENTS IN ADVANCED EDUCATION BY FIELD OF STUDY, 1979, 1982, 1985, 1986 AND 1987(1) Field of study 1979 '000 % 1982 '000 % 1985 '000 % 1986 '000 % 1987 '000 % Agriculture/forestry ... 1.9 1.2 3.2 1.9 3.8 1.9 4.0 1.9 4.5 2.1 Architecture/building ... 3.6 2.3 3.8 2.2 4.0 2.1 4.1 2.0 4.8 2.2 Arts/humanities/social sciences ... 24.7 15.8 27.2 15.7 31.8 16.4 33.9 16.3 34.7 16.3 Business/administration/economics . 29.7 19.0 38.2 22.0 44.1 22.8 47.9 23.1 46.5 21.8 Education ... 63.7 40.8 60.6 35.0 60.2 31.1 62.0 29.8 58.3 27.4 Engineering/surveying ... 10.9 7.0 12.9 7.5 14.6 7.5 15.1 7.3 15.7 7.4 Health/Medicine(2) ... 5.7 3.7 6.8 3.9 11.1 5.7 14.9 7.2 24.0 11.3 Law/Legal studies ... 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 3.0 (3)...1.4 Science ... 15.2 9.7 17.7 10.2 21.6 11.1 23.5 11.3 19.9 9.4 Veterinary Science ... 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Non-award ... 0.9 0.6 2.8 1.6 2.7 1.4 2.3 1.1 1.5 0.7 Total ... 156.3 100.0 173.3 100.0 193.8 100.0 207.7 100.0 212.9 100.0 Table 1.3 STUDENTS IN HIGHER EDUCATION BY FIELD OF STUDY, 1979, 1982, 1985, 1986 AND 1987(1) Field of study 1979 '000 % 1982 '000 % 1985 '000 % 1986 '000 % 1987 '000 % Agriculture/forestry ... 4.5 1.4 5.9 1.7 6.6 1.8 6.9 1.8 7.1 1.8 Architecture/building ... 7.0 2.2 7.6 2.2 8.0 2.2 8.1 2.1 9.0 2.3 Arts/humanities/social sciences ... 81.3 25.7 83.4 24.5 92.0 25.0 97.1 25.0 95.7 24.3 Business/administration/economics ... 50.1 15.8 60.5 17.8 68.4 18.5 73.2 18.8 72.7 18.5 Education ... 79.1 25.0 75.7 22.3 75.1 20.4 77.2 19.9 72.1 18.3 Engineering/surveying ... 22.3 7.0 26.0 7.7 28.3 7.7 28.9 7.4 30.1 7.6 Health/Medicine(2) ... 18.0 5.7 19.4 5.7 23.3 6.3 27.0 6.9 37.3 9.5 Law/Legal studies ... 9.3 2.9 10.6 3.1 9.9 2.7 10.0 2.6 11.2 2.9 Science ... 42.0 13.3 46.2 13.6 52.5 14.3 55.7 14.3 51.4 13.1 Veterinary Science ... 1.5 0.5 1.5 0.4 1.4 0.4 1.5 0.4 1.5 0.4 Non-award ... 1.5 0.5 3.3 1.0 3.2 0.9 3.0 0.8 5.5 1.4 Total ... 316.4 100.0 340.0 100.0 368.6 100.0 388.4 100.0 393.7 100.0 (1) Data for 1979, 1982, 1985 and 1986 exclude students at military establishments and students undertaking advanced education courses of ACT TAFE institutions, Marcus Oldham and NIDA. Data for 1979 also exclude all students undertaking advanced education courses in TAFE institutions and at non-government teachers colleges. Data for 1987 include students at all the above institutions. (2) From 1985 onwards these figures include State-funded basic nurse education students, following the decision in late 1984 to transfer nurse education from hospitals to Colleges of Advanced Education. (3) A new field of study classification of higher education courses was introduced in 1987. In previous years, students undertaking advanced education courses in law and legal studies were classified to the field of study-social sciences/humanities. Table 2 ANNUAL STUDENT CONTACT HOURS (ASCH) IN TAFE (STREAMS 2100-4500(1)) BY FIELD OF STUDY, 1982, 1985 AND 1986, STUDENTS IN TAFE BY FIELD OF STUDY, 1986(2) 1982 ASCH (million) % 1985 ASCH (million) % 1986(3) ASCH (million) % 1986(4) Students '000 % Applied Science... 3.0 1.8 3.4 1.8 3.1 1.6 14.9 1.6 Art & Design... 8.0 4.8 9.6 5.2 9.1 4.8 41.3 4.4 Building... 16.8 10.1 17.1 9.3 18.5 9.7 63.4 6.8 Business Studies... 38.0 22.9 43.7 23.7 46.3 24.2 239.9 25.6 Engineering... 45.3 27.3 40.9 22.2 45.2 23.6 166.9 17.8 Rural & Horticulture... 6.3 3.8 7.7 4.2 8.1 4.2 47.4 5.1 Music... 0.3 0.2 0.3 0.2 0.3 0.2 2.0 0.2 Paramedical... 1.5 0.9 1.4 0.8 1.5 0.8 8.2 0.9 Industrial Services... 6.8 4.1 8.6 4.7 14.3 7.5 99.1 10.6 Personal services... 14.0 8.4 18.9 10.3 23.5 12.3 134.4 14.3 General studies... 25.9 15.6 32.5 17.7 21.7 11.3 120.9 12.9 Total... 166.0 100.0 184.0 100.0 191.7 100.0 938.4 100.0 (1) Streams 2100-4500 include all TAFE courses other than those undertaken for recreation, leisure and personal enrichment. (2) Aggregated data for students classified by field of study are not available for years other than 1986. The only available data classified by field of study is annual student contact hours. (3) Latest available data. (4) These figures include 51,685 students who were enrolled in more than one course where the courses were in different fields of study. The net total number of students (ie. counting each student once only) for streams 2100-4500 is 886,679. (Question No. 553) Mr Rocher asked the Minister for Employment, Education and Training, upon notice, on 9 December 1987: How many overseas students were enrolled at Australian universities and colleges of advanced education in (a) 1985, (b) 1986 and (c) 1987. Mr Dawkins —The answer to the honourable member's question is as follows: The number of overseas students enrolled at Australian universities and colleges of advanced education was as follows: (a) 1985-15,332 (b) 1986-15,723 (c) 1987-15,933 (Question No. 617) Mr Tim Fischer asked the Minister for Employment, Education and Training, upon notice, on 18 February 1988: (1) What has been the percentage increase in the Austudy allowance during (a) 1985-86, (b) 1986-87 and (c) 1987-88. (2) How does this compare with the increases in the (a) CPI and (b) unemployment benefit for the same years. Mr Dawkins —The answer to the honourable member's question is as follows: (1) Austudy has been in existence only since 1987, when three former student assistance schemes were amalgamated. These were the Secondary Allowances Scheme (SAS), the Adult Secondary Education Assistance Scheme (ASEAS) and the Tertiary Education Assistance Scheme (TEAS). TEAS and ASEAS allowance rates were identical over the period in question. The figures provided are for TEAS, ASEAS and SAS in 1985 and 1986 and then Austudy for 1987 and 1988. The rates for all the schemes are fixed in the budget of the previous year and are set for the calendar year so the figures provided here show the increases from one calendar year to the next. There are the added complications that Austudy rates vary by age and sector and by whether the student is independent or not, and that increases have been different for different allowances. Therefore the percentage increases for the different maximum rates are provided in the table below. 1985 to 1986 1986 to 1987 1987 to 1988 (per cent increases) Secondary- 16-17 yrs at home ... 51.8 14.3 25.0 independent ... n.a. n.a. (a) 3.7 18+ yrs at home ... 51.8 28.6 33.0 independent/away from home ... 6.7 9.2 14.0 Tertiary- 16-17 yrs at home ... 6.7 5.3 0 independent/away from home ... 6.7 0 3.7 18+ yrs at home ... 6.7 15.8 9.1 independent/away from home ... 6.7 9.2 14.0 (a) Independent rates for younger secondary students were only introduced in 1987. (2) (a) CPI increases for the most relevant years, which are 1984-85, 1985-86 and 1986-87, were 6.7, 8.4 and 9.3 per cent respectively. On the whole these are lower than the increases in student allowances. (b) The relevant unemployment benefit rates i.e. the junior (now Job Search Allowance) and intermediate rates have increased by less than the student allowance rates. The increases in junior rates are 11.1, 0 and 0 per cent, and for the intermediate rates 3.5, 3.3 and 0 per cent for the three years in question. (Question No. 851) Mr Macphee asked the Minister for Defence, upon notice, on 24 March 1988: (1) Do Defence establishments in Australia use fluoridated drinking water, if so, (2) What are the scientific and medical reasons for doing this. Mr Beazley —The answer to the honourable member's question is as follows: (1) Yes. (2) The safety and efficacy of water fluoridation are well established; there is voluminous literature available to support the view. The scientific and dental reasons are addressed and confirmed in one of the more recent publications supporting water fluoridation; the `Report of the Working Party on Fluorides in the Control of Dental Caries', adopted at the 100th session of the National Health and Medical Research Council (NH&MRC)-November 1985. (Question No. 880) Mr Macphee asked the Attorney-General, upon notice, on 18 April 1988: (1) Further to answers to questions Nos. 578 and 625 (Hansard, 16 March 1988, page 981), will the National Crime Authority (NCA) destroy the diaries and notebooks deposited with it by the private detective who was referred to in the previous questions. (2) Is it a fact that those diaries and notebooks were recorded sequentially in terms of date and time of call, conversation or other entry. (3) Is it also a fact that one of those entries recorded Sir Peter Abeles instructing or advising another person to transfer sums of money from Australian dollars to American dollars; if so, (a) what sum of Australian dollars was involved and (b) how many days after that conversation passed before there was a decline of several cents in the Australian dollar compared to the American dollar. (4) Is he able to estimate what profit would have been made by someone making such a conversion when the money was re-converted to Australian dollars. (5) What action did the NCA take on the facts revealed on the tapes. (6) Even though the NCA believes that there was no breach of criminal law regarding the matters raised in the earlier questions, are there ethical matters which should be referred to the National Companies and Securities Commission and the Reserve Bank Board. Mr Lionel Bowen —The answer to the honourable member's question is as follows: in relation to parts 1 to 5 I am advised by the Chairman of the NCA: (1) The six notebooks produced by the private detective to the Royal Commission of Inquiry into Alleged Telephone Interceptions are kept in the custody of the National Crime Authority pursuant to the Archives Act. The National Crime Authority has no intention of destroying those notebooks. No diaries were produced by the private detective to the Royal Commission. (2) There are entries in the notebooks which are recorded sequentially in terms of date and time of call and conversation. (3) One of those entries reads as follows: ``Sir P. Aebles-(indecipherable word) re Aust $. wait till Singapore opens. 20 or 30 against a$ sell aust open new Pos.'' (4) No. (5) The National Crime Authority took no action on the English conversations recorded on the tapes, those tapes having been examined by the Royal Commission. The National Crime Authority considered whether the tape recordings of the foreign language conversations disclosed any criminal activity and came to the view that they did not. (6) I am not aware of any matter which should be referred to the National Companies and Securities Commission or the Reserve Bank Board.