Wednesday, 12 October 1988 Madam SPEAKER (Hon. Joan Child) took the chair at 10 a.m., and read prayers. Mr PEACOCK(Kooyong)(10.00) —I move: That so much of the standing and sessional orders be suspended as would prevent the Acting Treasurer forthwith advising the House of his reasons for demanding the Prime Minister's immediate resignation, as detailed on page 15 of today's Australian newspaper. In today's Australian is a revelation of the greatest importance for all Australians. They all happen to be suffering under this Government. But what is alleged in this article goes to the heart of the very nature of government today and to the incompetence of the current Government. Mr Paul Kelly has revealed in today's Australian that, some six weeks ago, the Acting Treasurer (Mr Dawkins) called on the Prime Minister (Mr Hawke) and demanded his resignation. We know that that followed more than simply-and I am an authority on car telephone calls-the call that Senator Richardson made on his car telephone to the Grim Reaper, that is, the person in the guise of the Treasurer. This is, however, no laughing matter. The article reveals more than simply a demand for resignation. It reveals hatred; it reveals animosity; it reveals frustration at the highest level of government amongst all the Government's economic Ministers. It reveals that Dawkins is finished with Hawke; that Hawke is finished with Dawkins; that Keating has considered resigning; that Walsh has told colleagues that he is thinking of quitting. Beyond that, it reveals the reasons for the absolute incoherence on living standards, on the direct impact of this Government, on taxes imposed on average Australians today, on the interest rates that they pay, on wage fixation, on the tax file number, on privacy-all of which the Government is unable to handle coherently. It reveals a government which is divided against itself. As Kelly puts it, the only certainty in terms of policy determination is uncertainty. Let me quote from the article for those honourable members who have not seen it, to help them to understand the reasons for our calling on the Acting Treasurer to indicate to the Australian people why he is demanding the Prime Minister's resignation. He is not merely saying to the Prime Minister, `Lead us to the next election and then resign'; he is saying, `Go, and go now'. Of course, if he does not go, we will have, in the current Prime Minister, a mere lame duck. Let me quote from the article: Dawkins said Hawke's record was unmatched . . . But it was important to know when to go; and that time had come. It continues: Dawkins is finished with Hawke . . . and Hawke, let me assure you, is finished with Dawkins. Paul Kelly says, in fact, that Dawkins's main role these days is his `informal capacity as Paul Keating's campaign manager'. Paul Kelly goes on to say: Here is the extraordinary situation into which the Hawke Government has got itself-with two senior economic ministers, the Treasurer and Acting Treasurer, Keating and Dawkins, both telling Bob Hawke he should go. . . . . . . . . . The real issue now is the fracture and tension in the Cabinet. It is a serious problem concerning authority, tactics and power within the Hawke Government. He does not have to say it, but he does write it, that `Keating and Dawkins are profoundly unhappy'. And as he said: This is not a media creation or a beat-up or some line being peddled by some so-called Keating push. This is a fundamental problem for the Hawke Government. He goes on, in words of very few syllables, to say: Nobody knows where the Hawke economic team is going from here. But the good old days are over. The super-optimists who think everybody can kiss and make up are in a condition of super-delusion. . . . . . . . . . Perhaps Keating will go; maybe there will be another reshuffle. The one certainty is uncertainty. Then Paul Kelly talks of Walsh going on the Sunday program Face to Face, having told colleagues mid-year that he was thinking of quitting. This article is in itself sufficient reasons for the Acting Treasurer to be in here explaining why. Opposition members-Where is he? Mr PEACOCK —He will not come in. We shall have whatever the Minister is these days as he is recycled, Mr Kerin, come in and explain it. Behind the scenes is the spectre of the Minister at the table, the Minister for Primary Industries and Energy (Mr Kerin), because if Hawke is finished with Dawkins, we know who he wants to make Treasurer. The Grim Reaper goes and in comes the man at the table. Ten out of ten for you, mate! Ten out of ten for you turning up today. Bob will be pleased. A lot of brownie points have been notched up this morning-just by sitting there, son; you are almost there. The foot is there. All we have to do is have the real Acting Treasurer, not the pretender, as at the table, come in and tell us why he said Hawke had to go. This is at the heart of government. It is disunity in the Cabinet. It is frustration. It is anger. It is hatred, and it is all the stuff of personal ambition being played out. All this is occurring at a time of the highest levels of taxation being dumped on Australians and the absolute incoherence in government. I said earlier that, whilst we want Dawkins in to explain to the Australian people why he said the Prime Minister has to go, it is not confined to him. Courtesy of the Keating-Richardson telephone conversation-it did not get quite the run that the Kennett-Peacock one did because just as it was about to be published the Government proclaimed on Tuesday of that week the legislation preventing the publication of such things. Mr Cadman —A great shame. Mr PEACOCK —I thought it was a shame, too, but the essence was the demand of Keating that Hawke go, just as Dawkins is doing now. The nub of it is that the Government is paralysed, the economic policy is incoherent. Honourable members have seen all the changes and, behind it all, the frustration, the anger and the ambition of Hawke Ministers. If the people of Oxley had read the Kelly article last week, it would not have been a 13 per cent swing to us; it would have been significantly greater. In fact, there would not even be a Labor member for Oxley coming in but rather one from our side. So this is a request. It may be asking too much to ask for honesty from the Government, but let the Acting Treasurer, in a form, as it were, of purging himself, do what is fundamental in our system of government: tell the people what he is on about. He is answerable to this Parliament. He has, as the Acting Treasurer, gone to the Prime Minister and demanded the Prime Minister's resignation, but he is not in here. The pretender is here. The brownie points are notched up. All in good stead is it moving for the Minister for Primary Industries and Energy, who is at the table; but we need the Acting Treasurer in to explain it away. If the article is headed `Dawkins and Hawke have split', it is worse than that-it is the essence of the Government itself. As I said in quoting the article, all the senior economic Ministers are wanting or have indicated a desire to resign. There is a touch of irony there. The only one they really want to go is hanging on for grim death. The Prime Minister himself-the lame duck-is essentially keeping it warm until the Grim Reaper returns from overseas and winds up the campaign. How do honourable members think the Grim Reaper must feel with all the jobs that have been done on him while he has been away? Madam SPEAKER —Order! Will the honourable member please refer to the Treasurer as the Treasurer? Mr PEACOCK —Are you assuming, Madam Speaker, that I was referring to the Treasurer as the Grim Reaper? Madam SPEAKER —I was. Mr PEACOCK —I will refer to him as the Treasurer. This Government has adopted three attitudes in its propaganda. First, it talks itself up; it says that it is the greatest government in the history of this nation and the problem is that it actually believes that, although nobody else does. Secondly, it dumps it on the Opposition and, thirdly, it promotes some notion of unity when there is deep division in the camp. The nation suffers as a consequence and that is why the Government cannot get its economic policy right. The Acting Treasurer today has a bounden duty to come here and explain to the people what he explained to the Prime Minister in words of a few syllables-that he ought to go. Madam SPEAKER —Is the motion seconded? Mr TUCKEY(O'Connor)(10.12) —I second the motion and wish to address this particular issue immediately. What we are looking at today is a matter of huge national importance. We are looking at a split between major economic Ministers and the Prime Minister (Mr Hawke). In these very difficult economic times the Australian people are entitled to be reassured. The best outcome of this motion for the nation would be for the Acting Treasurer (Mr Dawkins) to come here and deny that he ever made these remarks and deny this article. He should have been here beating us to the punch. He should have been jumping up on a personal explanation and telling us that not for one moment has he ever suggested to his Prime Minister that he should leave. He should say that he supports the Prime Minister totally. But the Acting Treasurer is notable by his absence and, as the Deputy Leader of the Opposition (Mr Peacock) has pointed out, the man who would prefer to have his job is sitting in here apparently with the intention of arguing that it is absolutely unnecessary for the Acting Treasurer to come here and reassure the Australian people that this Government is still on track. He should be telling us that the situation is not as Mr Kelly has described it in his article. Mr Kelly said: Nobody knows where the Hawke economic team is going from here. But the good old days are over. We know why the Acting Treasurer is not here: he has been caught out on radio as well. On 29 August he went on AM and the interviewer, Mr Maher, said: On another matter Mr Dawkins, do you agree with Senator John Button that the Prime Minister should announce a timetable for his departure from politics, to avoid tensions over his successor? Mr Dawkins replied-and I heard this personally: I think certainly the question of succession has to be sorted out and the sooner the better, I would have thought. When Mr Maher asked him whether he thought Mr Keating would be the next leader of the Australian Labour Party, the Acting Treasurer replied: Oh of course. He has my full support to become the next leader of the party. What was not said on that program was that on that same day, 29 August, he went into the Prime Minister's office and said that the succession should be sorted out now. By his absence he, like the Treasurer (Mr Keating), shows an arrogant disregard for his Prime Minister. The Treasurer refused to deny that he had had that phone conversation with Senator Richardson and by his refusal he confirmed that that outrageous conversation had occurred. Now we have another Minister, the Acting Treasurer, being reported as saying that he had been to his Prime Minister and told him to resign. He too will not come in here and deny it. That is absolute confirmation that that occurred. It is also absolute confirmation that, as Mr Kelly said, nobody knows where the Hawke economic team is going from here, but the good old days are over. We now find that arrogance is not only being practised upon the Australian people but also being practised by senior Ministers upon the Prime Minister and upon the office of Prime Minister. That is outrageous and of huge concern to the Australian people when they see their living standards falling daily and their taxes rising-$275 per individual Australian in the last Budget. What reassurance do they get? They see everybody fighting over the top job and a Prime Minister who is now clearly evidenced as having no control at all over the situation. You will remember, Mr Deputy Speaker, the last time we raised dissent in this place. I had to point out to Madam Speaker that we could not judge the issue on this Prime Minister because clearly this Prime Minister was different. He did not have any responsibility for his Ministers because he had lost control of them. I guess it was reasonable therefore that he did not have to answer an embarrassing question about the activities and actions of his Ministers. However, it does not alter the fact that what we are confronted with today is a headline that says that Dawkins and Hawke have split. We are confronted with an article that says that the Acting Treasurer on 29 August asked his Prime Minister to resign and make way for the Treasurer, that the Acting Treasurer is acting as the Treasurer's campaign manager and that, of course, the situation is very grim because everybody wants the top job. The Australian people have to be reassured. It is outrageous that the Acting Treasurer is not here to reassure them by saying that it never happened and that that is not going to happen. We know it happened. We know now that the Minister for Primary Industries and Energy (Mr Kerin), the Acting Leader of the House, is going to get up in defence again of this Minister who has demonstrated over the last four or five days that he cannot even answer questions. Of course, we have seen disaster for the Government. Mr DEPUTY SPEAKER(Mr Leo McLeay) —Order! The honourable member's time has expired. Mr KERIN(Werriwa-Minister for Primary Industries and Energy and Acting Leader of the House)(10.17) —We would have to be pretty blooming silly to take this censure motion seriously. The Opposition is fluttering around like the bogong moths in the chamber. Members of the Opposition come in and put on a bit of a display. The Peacock preens his feathers hoping to get a bit of a flash of blue. There are no policies from the Opposition. This Government has been responsible for the most fundamental restructuring of the economy. We pulled the economy out of the mess that the Opposition left for us. There was massive unemployment. We needed a total restructuring of secondary industry in this country. There was an overvalued exchange rate that had the miners and the farmers of this country in absolutely diabolical trouble. Mr Fife —Mr Deputy Speaker, I rise on a point of order. The House ought to be made aware and so should the Minister that this is not a censure motion. It is a motion to give the Acting Treasurer an opportunity to explain his position. Mr DEPUTY SPEAKER —There is no point of order. Mr KERIN —I am quite happy to take the point of the honourable member for Hume. This suspension of Standing Orders is an absolute nonsense. It is all about a suspension based on a newspaper article. This is how good this Opposition is. The once great Liberal Party of Australia has sunk to this. The only thing it can ever come into the House about is a newspaper article. Last night I heard the honourable member for Riverina-Darling (Mr Hicks) say that he had read something in a newspaper. Now the Opposition accepts it as fact. Even the honourable member for Kooyong has said that I am going to be the Treasurer because he read it in an article by Laurie Oakes in the Bulletin-would you believe it. So anything that is written down the poor old Opposition believes because it has no policies. It has no capacity to analyse what is happening in this country. It has no capacity to put forward alternative economic policies. What is this all about? This is all about a cover-up for the weak, rotten leadership of the Liberal and National parties. They are in their opportunistic mode. What do we hear? One day we hear that the Leader will be John Elliott, then it will be Sallyanne Atkinson, then it could be Ian McLachlan. Anyone out there who gets a headline or two could be the next Leader of the Liberal Party. We have a totally opportunistic Opposition. There is not an ounce of courage or guts in it. Mr Tuckey —Mr Deputy Speaker, I rise on a point of order. On the matter of relevance-- Mr DEPUTY SPEAKER —There is no point of order. Mr Tuckey —I am sorry, there is a point of order. You have not heard my point of order at this stage. Mr DEPUTY SPEAKER —You had better quickly come to it. Mr Tuckey —On the matter of relevance, the Minister is apparently here to defend the absent Acting Treasurer. Mr DEPUTY SPEAKER —There is no point of order. Mr KERIN —The Opposition is in its opportunistic mode. It has no economic policies. What happened? We had a terms of trade collapse in this country through 1985, 1986 and 1987. The Leader of the Opposition (Mr Howard) never said a word about that-it never existed. All he could talk about was that living standards might have dropped a bit. What would the Opposition have done? It would have thrown the economy into reverse. Honourable members should see what John Stone said about the October stock market crash. The only policy the Opposition had was to throw the economy into reverse. That is what it is all about. If the Opposition reads something in the newspapers it will come in here and try to suspend Standing Orders. The Opposition reads something in the polls, for example Asian immigration, and as a result decides that it will run that for a while. It will run anything that it sees as opportunistic, for example, the referendums. At all costs the Opposition had to preserve the coalition; so one vote one value had to be rejected. The Opposition could not upset the National Party of Australia about that. So what does the Opposition do? It knocks the whole lot over. Mr Fife —Mr Deputy Speaker, I take a point of order. The motion before the House is about the suspension of Standing Orders to give the Acting Treasurer an opportunity to explain the reported statement. The Minister is not addressing the question. He is addressing other matters, and you should instruct him accordingly. Mr DEPUTY SPEAKER(Mr Leo McLeay) —Order! The Minister is bringing forward reasons why the motion should not be agreed to. The Minister is in order. Mr KERIN —Members of the Opposition have ranged widely and I am telling them the facts. This is opportunism. Anything they read in the newspapers they take as factual. This is just a nonsense. What did we have before the Victorian election? We had all the allegations about the Reserve Bank of Australia. Mr Johnston had to come out and say how stupid it was. Members of the Opposition are totally opportunistic. They can only run on what they see in a few polls around the place. Today we have the once great Liberal Party of Australia running on what it sees in the newspapers. This is an absolute nonsense. I move: That the question be now put. The House divided. (Madam Speaker-Hon. Joan Child) Ayes . . . . . . . . . . . 66 Noes . . . . . . . . . . . 48 —— Majority . . . . . . . . . 18 —— Baldwin, P. J. Kelly, R. J.Beddall, D. P. Kent, L.Bilney, G. N. Kerin, J. C.Blanchard, C. A. Kerr, D. J. C.Brown, Robert Lamb, A. H. (Teller)Campbell, G. Langmore, J. V.Charles, D. E. Lavarch, M. H.Charlesworth, R. I. Lee, M. J.Cleeland, P. R. Lindsay, E. J.Cohen, B. McHugh, J.Crawford, M. C. McLeay, LeoCunningham, B. T. (Teller) Martin, S. P.Dawkins, J. S. Mildren, J. B.Dubois, S. C. Milton, P.Duncan, P. Morris, AllanEdwards, Ronald Morris, PeterFatin, W. F. Price, L. R. S.Fitzgibbon, E. J. Punch, G. F.Free, R. V. Saunderson, J.Gayler, J. Sawford, R. W.Gear, G. Scholes, G. G. D.Gorman, R. N. J. Sciacca, C.Grace, E. L. Scott, JohnGriffiths, A. G. Simmons, D. W.Hand, G. L. Snow, J. H.Harvey, E. R. Snowdon, W. E.Hawke, R. J. L. Staples, P. R.Hollis, C. Theophanous, A. C.Howe, B. L. Tickner, R. E.Jakobsen, C. A. Uren, T.Jenkins, H. A. West, S. J.Johns, G. T. Willis, R.Jones, Barry Wright, K. W. Adermann, A. E. Lloyd, B.Aldred, K. J. McGauran, P. J.Andrew, J. N. (Teller) Macphee, I. M.Braithwaite, R. A. Miles, C. G.Brown, N. A. Moore, J. C.Cadman, A. G. Nehl, G. B.Cameron, Ewen Peacock, A. S.Cameron, Ian Porter, J. R.Carlton, J. J. Pratt, M. P.Cobb, M. R. Prosser, G. D.Connolly, D. M. Reith, P. K.Cowan, D. B. Robinson, IanDobie, J. D. M. Rocher, A. C.Downer, A. J. G. Ruddock, P. M.Edwards, Harry Shack, P. D.Fife, W. C. Sharp, J. R.Fisher, Peter Sinclair, I. McC.Goodluck, B. J. Smith, W. L.Hawker, D. P. M. Spender, J. M.Hewson, J. R. Sullivan, K. J.Hicks, N. J. (Teller) Taylor, W. L.Howard, J. W. Tuckey, C. W.Hunt, R. J. D. Webster, A. P.Jull, D. F. Wilson, I. B. C. Humphreys, B. C. Hall, SteeleBrumby, J. M. Cameron, DonaldMountford, J. G. McArthur, F. S.O'Neil, L. R. T. Blunt, C. W.Darling, E. E. White, P. N. D.Keating, P. J. Shipton, R. F.Duffy, M. J. Katter, R. C.Klugman, R. E. Halverson, R. G.Bowen, Lionel Beale, J. H.O'Keefe, N. P. Millar, P. C.Blewett, N. Woods, R. L. Question so resolved in the affirmative. Original question put: That the motion (Mr Peacock's) be agreed to. The House divided. (Madam Speaker-Hon. Joan Child) Ayes . . . . . . . . . . . 48 Noes . . . . . . . . . . . 65 —— Majority . . . . . . . . . 17 —— Adermann, A. E. Lloyd, B.Aldred, K. J. McGauran, P. J.Andrew, J. N. (Teller) Macphee, I. M.Braithwaite, R. A. Miles, C. G.Brown, N. A. Moore, J. C.Cadman, A. G. Nehl, G. B.Cameron, Ewen Peacock, A. S.Cameron, Ian Porter, J. R.Carlton, J. J. Pratt, M. P.Cobb, M. R. Prosser, G. D.Connolly, D. M. Reith, P. K.Cowan, D. B. Robinson, IanDobie, J. D. M. Rocher, A. C.Downer, A. J. G. Ruddock, P. M.Edwards, Harry Shack, P. D.Fife, W. C. Sharp, J. R.Fisher, Peter Sinclair, I. McC.Goodluck, B. J. Smith, W. L.Hawker, D. P. M. Spender, J. M.Hewson, J. R. Sullivan, K. J.Hicks, N. J. (Teller) Taylor, W. L.Howard, J. W. Tuckey, C. W.Hunt, R. J. D. Webster, A. P.Jull, D. F. Wilson, I. B. Beddall, D. P. Kent, L.Bilney, G. N. Kerin. J. C.Blanchard, C. A. Kerr, D. J. C.Brown, Robert Lamb, A. H. (Teller)Campbell, G. Langmore, J. V.Charles, D. E. Lavarch, M. H.Charlesworth, R. I. Lee, M. J.Cleeland, P. R. Lindsay, E. J.Cohen, B. McHugh, J.Crawford, M. C. McLeay, LeoCunningham, B. T. (Teller) Martin, S. P.Dawkins, J. S. Mildren, J. B.Dubois, S. C. Milton, P.Duncan, P. Morris, AllanEdwards, Ronald Morris, PeterFatin, W. F. Price, L. R. S.Fitzgibbon, E. J. Punch, G. F.Free, R. V. Saunderson, J.Gayler, J. Sawford, R. W.Gear, G. Scholes, G. G. D.Gorman, R. N. J. Sciacca, C.Grace, E. L. Scott, JohnGriffiths, A. G. Simmons, D. W.Hand, G. L. Snow, J. H.Harvey, E. R. Snowdon, W. E.Hawke, R. J. L. Staples, P. R.Hollis, C. Theophanous, A. C.Howe, B. L. Tickner, R. E.Jakobsen, C. A. Uren, T.Jenkins, H. A. West, S. J.Johns, G. T. Willis, R.Jones, Barry Wright, K. W.Kelly, R. J. Question so resolved in the negative. Consideration resumed from 11 October. Schedule 3. Department of Primary Industries and Energy Proposed expenditure, $352,533,000. Mr HAWKER(Wannon)(10.37) —I would like to raise a few matters relating to the Department of Primary Industries and Energy in discussing the Appropriation Bill (No. 1) 1988-89. I begin by endorsing the words of my colleague the honourable member for Wakefield (Mr Andrew), who pointed out that agriculture still is our major export earner. As he said, despite all the rhetoric and all the efforts of some to get other industries involved more in exports agriculture is still the No. 1 export earner. It is important to keep this perspective on these appropriations and in particular on the way in which the Government has altered some of the recording of these appropriations. I also draw attention to the fact that, with agriculture still the major export earner, it is amazing how the Government places such a low priority on trade in general when we still have this chronic balance of payments problem. In the past two months the balance of payments has come out far worse than the Government would have anticipated and far worse, I think, than all Australians would like to see. In addition, we have had a clear warning from the Organisation for Economic Cooperation and Development (OECD), as reported in the Australian Financial Review on Monday, 26 September. With respect to the Minister for Primary Industries and Energy (Mr Kerin), who is at the table, I will read from this newspaper cutting because it is worth taking note of. It was pointed out: The Organisation for Economic Cooperation and Development (OECD) has predicted another glut in farm goods, and lower market prices, resulting from the continuing $300 billion a year in agricultural subsidies. It goes on: The OECD report warns that the longer the significant reduction in supports- that is, overseas- is delayed the greater will be the extent of the eventual adjustment. With that background it is very disturbing to notice that in relation to the Government's emphasis on trade, although there is a lot of rhetoric, and maybe encouraging rhetoric, when we look at the cold, hard facts and the Budget statements for 1988-89 we find that the assistance to export industries has been cut. Assistance for trade in the export market development schemes, export trade promotion and the other various forms of government assistance for improving our trade have been cut. Not only have they been cut, but they have been cut by a massive 25 per cent. When we look at the problems of our balance of trade and the warnings the OECD has been putting out about the future for agricultural trade in particular, and bearing in mind that agricultural trade is still our major export earner, it is very disturbing to find the Government's Budget statements telling us that the Government seems to think so little of improving trade that it has made a 25 per cent reduction in the amount of funds allocated for trade development. The other matter I should like to draw to honourable members' attention is the way the Government has changed its accounting procedures in reporting the assistance to agriculture, forestry and fishing, as pointed out in the Budget Papers. I find this very disturbing, even though the Minister admits that he is well aware of it. We find an extraordinary change. In order to make it clearer, I seek leave to incorporate in Hansard two tables, one from last year's Budget statements and one from page 217 of this year's Budget statements, which show the change in the financial outlays for agriculture. Leave granted. The tables read as follows-- 1987-88 Budget Papers SUMMARY OF AGRICULTURAL AND PASTORAL INDUSTRIES 1985-86 Actual 1986-87 Actual 1987-88 estimate Change $m $m $m $m % 7B.2.1 Wool Industry ... 39.5 96.9 47.5 -49.4 -51.0 7B.2.2 Wheat Industry ... 112.4 19.2 11.6 -7.6 -39.5 7B.2.3 Sugar Industry ... 1.7 23.5 13.8 -9.7 -41.3 7B.2.4 Dairy Industry ... 1.5 3.2 Cr...0.3 3.4 na 7B.2.5 Fruit Industry ... 1.8 4.7 0.1 Cr...-4.8 na 7B.2.6 Poultry Industry ... 0.5 0.4 1.4 1.0 225.7 7B.2.7 Cattle, Sheep and Pig Industries ... 26.0 27.5 26.4 -1.0 -3.7 7B.2.8 Other Agricultural and Pastoral Industries ... 8.2 11.1 16.8 5.7 51.5 7B.2.9 Charges and Repayments nec ... 5.8 Cr...5.8 Cr...6.5 Cr...-0.6 -10.9 Total Specific Industries ... 185.8 174.3 111.4 -63.0 -36.1 7B.2.10 General Assistance not Allocated to Specific Agricultural and Pastoral Industries ... 144.7 183.9 179.7 -4.2 -2.3 7B.2.11 Water Resources Development and Management ... 44.5 45.8 46.7 0.9 2.0 7B.2.12 Land Development Projects ... 2.4 3.2 3.9 0.7 21.6 7B.2.13 General Administration ... 52.8 56.3 65.6 9.3 16.4 7B.2.14 Recoveries ... 3.4 Cr...3.5 Cr...3.7 Cr...-0.1 -3.6 Total ... 426.7 460.0 403.6 -56.4 -12.3 1988-89 Budget Papers SUMMARY OF AGRICULTURAL, FORESTRY AND FISHING INDUSTRIES 1986-87 Actual 1987-88 Actual 1988-89 estimate Change $m $m $m $m % 7B.1.1 Fishing Industry... 16.1 22.8 20.4 -2.4 -10.4 7B.1.2 Wool Industry ... 342.7 447.1 494.6 47.5 10.6 7B.1.3 Wheat Industry ... 27.7 186.2 18.4 -167.8 -90.1 7B.1.4 Dairy Industry ... 217.3 168.3 171.2 2.9 1.7 7B.1.5 Horticultural Industry ... 27.5 18.0 24.1 6.2 34.5 7B.1.6 Cattle, Sheep and Pig Industries ... 93.0 105.4 164.7 59.3 56.3 7B.1.7 Other Agricultural and Pastoral Industries ... 39.9 17.2 28.2 11.0 64.2 Total Specific Industries ... 764.3 964.9 921.7 -43.2 -4.5 7B.1.8 General Assistance not Allocated to Specific Agricultural, Forestry and Fishing Industries ... 230.0 225.7 213.1 -12.5 -5.6 7B.1.9 Natural Resources Development and Management ... 48.7 44.9 71.0 26.0 58.0 7B.1.10 General Administration ... 63.2 74.0 81.5 7.4 10.0 Total ... 1 106.2 1 309.6 1 287.3 -22.3 -1.7 Chart 1 shows outlays by sector for the `Agricultural, Forestry and Fishing Industries' and the extent to which these outlays are matched by industry contributions through levies and charges. Mr HAWKER —I thank the House. We see the way the Government has changed its method of accounting. In the past the Government included the net outlays going to a particular agricultural industry only because it was recognised, and recognised quite correctly, that where levies were raised by the Government on behalf of a particular industry and those levies were agreed to by the industry then that was not really government assistance but in fact was an industry helping itself. We see from the tables some remarkable changes in the accounting. In the latest Budget statements the Government has included the full value of these levies as though they were government outlays. If we compare these two tables and have a quick look at a couple of the figures, in the summary from last year for agricultural and pastoral industries, the actual outlays in the wool industry, for example, were $96.9m. That includes promotion, research and a few other things. Looking at the sum recorded in this year's Budget statements, we find for under 1986-87, the same year, the figure has miraculously jumped from $96.9m to $342.7m. Same year, same industry, and yet the figure has increased by 3 1/2 times. This new accounting system, I feel, ought to be changed back to the old one. It gives a highly misleading picture of the Government's real outlays for the industry. Someone who is not fully au fait with what is going on gets a very inflated picture of the true level of the assistance the Government is giving to the various primary industries. Taking another example, the 1986-87 actual amount for the dairy industry in last year's Budget statements shows that in fact there is a credit of $3.2m. Yet miraculously, when we look at the figures for the same year in this year's Budget statements, that $3.2m credit has been altered to $217.3m debit. In other words, it appears to someone who is not really informed about it that the Government has given the dairy industry $217m, which of course is absolute rubbish. It is very misleading and I think it behoves the Minister, if he is fair dinkum about the importance of presenting a fair and true picture of the real state of assistance to various industries, to alter the accounting procedures that have been adopted in this year's Budget statement back to what they were. It would be very easy for people who are not fully informed about what is going on in the industry to misunderstand these figures. For example the gross figures for the various primary industries, again taking 1986-87, in last year's Budget Statements show the total as $460m. If we look at this year's Budget statements, that figure has jumped to $1.3 billion. It is the same year but a different accounting method has been used. This is something I view very seriously and I hope the Minister will give some undertaking about that for next year's Budget Papers, irrespective of whether he is still the Minister. We heard earlier this morning that he may be in for a promotion. He is nodding his head in agreement; he is looking forward to that promotion. Before he shifts he has to get that fixed, even if he happens to be the Treasurer. In the short time left to me I would like to repeat the concern that members of the Opposition have for the cuts in the Budget to the Commonwealth Scientific and Industrial Research Organisation (CSIRO). We have seen some very serious cuts, not just in the last year but over five years. In fact, if we look at the changes, starting in 1983-84-this Government's first year in office-in real terms the CSIRO budget was $331.6m. It has been cut every year in real terms since then. In 1984-85 it was cut by 6 per cent; in 1985-86 by 2 per cent; in 1986-87 by another 2 per cent; in 1987-88 by 12 per cent; and in the current Budget by a further 8 per cent. This is causing enormous problems. As the shadow Minister for science and energy, the honourable member for Gippsland (Mr McGauran), has already pointed out, people working for the CSIRO are becoming very disillusioned and are rapidly looking for ways and means of getting out of it. What will the Government do? We will have another inquiry. The figures speak for themselves. We do not need another inquiry to tell us what is wrong. What is wrong is the cuts to the Budget. I think it is important for the Minister to address the points that have been raised. In order to improve our trade we need a commitment by the Government to the importance of maintaining a consistent level of funding. We need a commitment to clarify in the Budget Papers the method of accounting so that people do not get inflated ideas of what the Government's real level of assistance to primary industry is. We need a commitment to the importance of maintaining a real effort in our research. Without those things there is no doubt that not only the agricultural sector but also Australia in general will be worse off. Mr KERIN(Werriwa-Minister for Primary Industries and Energy)(10.46) —I thank all honourable members who have contributed to the discussion of the estimates for the portfolio of Primary Industries and Energy, particularly the honourable member for McMillan (Mr Cunningham), the honourable member for Calare (Mr Simmons) and the honourable member for Macarthur (Mr Martin). No member of the Opposition spoke on the resources and energy part of the portfolio. That is understandable, given the composition of the seats of many honourable members opposite. I point out that the resources and energy industries are very much part of rural Australia, as are the people who live in the towns and provincial cities. One Opposition member, the honourable member for Gippsland (Mr McGauran), concentrated his remarks on the research portfolio. Those questions would be better directed to the responsible Minister, the Minister for Science, Customs and Small Business (Mr Barry Jones). The Leader of the National Party of Australia (Mr Sinclair), who has a responsibility as spokesman on resources, did not speak. The former Opposition spokesman on energy, the honourable member for Bass (Mr Smith), has been replaced in that role by the honourable member for Gippsland, so it seems that it is a fair case to make that the Opposition does not take energy all that seriously. In responding to some of the comments I will contain my remarks to agriculture. One can sum up the contribution of the Opposition as being, `Yes, it is very important to cut government spending, but certainly not here. It is very good to apply all sorts of strictures to the rest of the economy, but not here'. The double standard prevails. In many of the comments there was a lot of selective figuring. There is a double standard in the general claims by the Opposition that there should be incentives for agriculture, for trade. It says, `Remove protection for secondary industries, but not agricultural subsidies and protection'. I will try to put the whole question of levels of assistance to agriculture into the overall context, because the decisions we took in the May statement in respect of across-the-board industry protection, including in some of the agricultural industries, will mean, in time, a saving of $300m to $400m a year in costs for each of the agriculture and resources sectors. Some of the most recent Treasury and Australian Bureau of Agricultural and Resource Economics estimates show that, all things being equal-of course, we know that things are not equal all the time-and on current projections we will get, from that measure alone, an additional $1.2 billion worth of exports in the early 1990s. Let us look at the cost situation compared with that which prevailed when we came to office. We now have the best terms of trade figures for 17 years and the lowest farm cost figure of about 4 per cent or 5 per cent, compared with 11 per cent when we came to government. An indication of the health of the sector is that land values are rising again. There is a lot of re-investment in agriculture. That is a good thing. I am not one to talk about people never having had it so good. Agriculture never had it so bad in quite recent times, particularly during 1985-86, but even then, some industries were getting on reasonably well. The really bad part of the agriculture sector was the cereal sector. It certainly went through the toughest time that we have known for a very long time. We do not say one thing here and another thing abroad. Mr Anthony, after the 1977 General Agreement on Tariffs and Trade round, said that he did not have to touch one item of secondary industry protection and that we got off scot-free. We all know-and now the more economically literate members of the Opposition know-that levels of secondary industry protection are a tax on exporters. What we in government are trying to say is that cuts in protection do not advantage just the exporting sectors; they advantage all of us as consumers in society. There has been quite a bit of discussion on interest rates. Basically interest rates go up and down. If a country has a floating currency, a deregulated financial market, if it has measures of money supply, a credit economy, a plastic card economy, many of these things must be dealt with under a whole new perspective. The 90-day bank bill rate-the rate at which the banks borrow-peaked at 19.8 per cent at the beginning of 1986 and dropped to just under 11 per cent by January this year. So there was a drop during that two-year period. During the life of the last Government, the 90-day bank bill rate was 21.75 per cent for a period and dropped in 1984 to 9 per cent. I do not make much of those figures, other than to say that interest rates will go up and down and they will fluctuate when there is a floating currency and deregulated financial markets. That is the nature of it. Sure, it can always be exploited. The argument on interest rates can never be won because everyone wants low interest rates. But interest rates are one of the policy instruments available to the Government which help fortify our exporting industries, in as much as if the price for our commodities falls overseas and the exchange rate falls, that provides a cushion, but, of course, interest rates must increase. That is the new ball game that exists. We have cut Government spending. The Opposition would like to cut a lot more, but historically we are in surplus and have a nil public sector borrowing requirement. We are heading for a lower inflation rate. If we can hold together all the parameters through this year, in terms of our economic management, using all of the measures available to us flexibly, we will get lower inflation and, therefore, lower interest rates. That is what the Government is talking about. The Liberal Party is saying that we should give tax cuts now. It never accepted the trade problem which existed, particularly during 1985, 1986 and 1987. It never really contemplated looking at the effects of some of its non-policies, particularly those which would suck in imports and wreck our inflationary position. During that period when there was a massive terms of trade crisis, the Opposition never stated what its alternative policy would be. Unspoken, its policy was that the economy should be thrown into reverse. The same prognostications came from various people such as Senator Stone during the October stock market crash. The instant thing to do was to throw the economy into reverse. The comments by members of the Opposition show that they have learnt little or that they are appeasing their country constituents by telling them what they want to hear. I have never adopted that path. Now that the portfolio has been expanded to include primary industries and energy, my portfolio is associated with 80 to 85 per cent of Australia's exports. That proportion coming from primary and resources industries will remain at that level in the future, as far as we can see it. Of course, we should try to broaden the base of the economy. The 1985-86 terms of trade collapse showed how thin and vulnerable Australia was to exposure on corrupt international markets for commodities. In the past we have had debates in this House and in the community that centred on agriculture versus mining. At least, with the big industry portfolios, both the agriculturalists and the miners know that they are in the one boat and that their own interests are mutually supportive. Now we have the debate that agriculture and mining are somehow against the secondary industries. What I say to the Opposition and outside commentators is that the more constructive approach is to look at the linkages and look at the complementarities. As I have said, the Government's strategy concentrates very much on the float, financial deregulation, the wages accord, and the fact that we will deregulate where there are sensible reasons; that we are not engaging in deregulation or privatisation from any ideological bent. We have these very fundamental economic measures in place because that will be bringing around a restructuring, and when there is an increasing job situation, increasing jobs on the domestic market, when all the economic policies are not throwing the economy into reverse, jobs are created and then cuts to industry protection can effectively be put in place. That is what we are doing-unlike the Whitlam years and the 25 per cent across the board cut, which really had a bad effect because the economy was not expanding. So we have put in place these measures that really bring about a restructuring and are broadening our base, and because we are able to lower levels of protection we are lowering costs. Because of all these measures we are getting fundamental restructuring and are enabled to pass on the benefits of cuts in tariffs. I will not comment on it too much but, obviously, the alternative economic policy is one to throw it into reverse. That is what Senator Stone still says. Senator Stone now says, with a fair amount of veracity, that we should not give big tax cuts now-which is against the opportunistic statements of the Leader of the Opposition (Mr Howard). There has been some discussion on research, and I have been well and truly involved in this debate in the broader community. There are some matters I can put forward in the context of what I have already said. First of all, we have been underspending on research in the CSIRO. I do not back away from that statement at all. It is a statement I have made in other places and it is a statement that the Prime Minister and the Cabinet have taken on board due to the work of the Minister for Science, Customs and Small Business and of the Minister for Industry, Technology and Commerce (Senator Button) and myself. However, I would like to make some additional points. First of all, on the crude figuring, if one compares this year's with last year's figures for the CSIRO, the Institute of Animal Products and Processing was actually up by 2.9 per cent; the Institute of Plant Production and Processing was down by 1.8 per cent, a decrease of $1.5m. What these crude budget figures do not tell, of course, is the amount of funds coming in from outside for the CSIRO. The institutes that handle industry and information industries were up; by some $5.8m for the Institute of Industrial Technologies and by $3.5m for the Information and Communications Technologies Institute. They were up, but I make the point that more expenditure on research in the manufacturing parts of CSIRO is no bad thing necessarily for primary industries. If they emphasise their work, put emphasis on value adding, that adds value to our primary exports, our resource exports. I make the point that if there is additional money spent on service industries, this is no bad thing. If we get better transport, better financial services and better services as a whole, this is no bad thing. So I am bringing out the linkages and the complementarities. Similarly, with information industries, the information base to our society, there is need for research there. Computer-aided livestock marketing, what the CSIRO will be able to do with reinterpretation of weather data electronically, distance education, all of these new technologies-again, they are no bad thing for our primary and resource industries. We want to look more and more at the linkages and the complementarities, rather than some bald analysis which is just based on figures or sector versus sector. As honourable members know, the rural industry research funds have expanded greatly in the amount of funds being attributed to them. The special research grant scheme has also vastly expanded since the days of the previous Government and we have set up various research and development corporations, and they are certainly leading the way in expending quite a lot more money. A comment was made that secondary industry does not levy itself whereas primary industries do have to put in some money. I suppose one has to think about what is the nature of secondary industry and what is the nature of primary industry. Primary industry has something like 170,000 units; atomistic competition: no one person is able to do his or her research. Therefore, it is best to go in on a basis whereby the Government is contributing money. In other words, there is a very good argument for public contribution of funds. Similarly, there is a very good argument for a levy mechanism, and by giving incentives we have been able to get a lot more money into research through this way. With secondary industry we have gone for a taxation deduction because, in many industries, we are dealing literally with a handful of firms. That is by far the better way to go than trying to levy them somehow. I make all these points, as I made them a few minutes ago in the debate on the motion for the suspension of Standing Orders, in the light of the fact that we took office when there was a recessed economy. At that time there had been a wage blow-out and there was a very high exchange rate, which was crippling our export industries. We saw the near destruction of secondary industry. What we have in place are policies aimed at the restructuring of the Australian economy. So we got through that recessed period-and then we faced the commodity price crash. Through 1985, 1986 and 1987, this, of course, pushed up interest rates. The exchange rates dropped for some commodities by up to 45 per cent-about 45 per cent for coal, and about a 37 per cent drop in the value of the dollar for the full bracket of agricultural industries. The depreciation kept us in business, but of course, international debt rose. What the Opposition never answered then-and the Leader of the Opposition seriously avoids it-is what they would have done. The only alternative economic strategy would have been to throw the economy into reverse and cause another half a million people to be unemployed. What was remarkable about the 1985, 1986 and into 1987 crash was that the prices of nearly all commodities came down. In the commodity markets, we are now back into the more usual situation where some are up and some are down. There are about 21 commodities in my portfolio-with exports worth from $350m per annum to $5.6 billion and $5.8 billion per annum for coal and wool. But we are now in the more usual situation. We have just held the line on coking coal. We have had an actual increase on steaming coal. Iron ore prices are still depressed. Wheat has been terrible, as I have said, but it looks like facing a year or two of good prices. Lead is still down. Sugar has been up high and is now settling down to a new sort of position. Aluminium clearly will hold, by an examination of the order books, through calendar 1989. So we know where we are. It is the more usual pattern. Some commodity prices are up and some are down, and this is giving a balancing. There has been a lot of speculation about the commodity price outlook as factored into the Budget itself. We are saying-and it is the basis of those calculations-that when the pluses and the minuses are put together, by and large we face a zero change in resource sector prices, along with the forecast of about a 7 per cent increase in farm sector prices. On the resource side, with that additional money we got for steaming coal and the other prices as they come in from the other markets, we will probably have an increase right through the year on resource sector prices. But if it is put together with the latest figuring, there will be average increases in commodity export prices of about 3 per cent this year. That may be seen by some to contradict the Budget forecast of a 9.4 per cent increase in Australia's terms of trade, but this increase has occurred despite a 12 per cent currency appreciation in trade weighted terms. So it represents a 17 per cent increase in commodity prices in world prices. If this currency change is fully passed on in lower import prices, then these forecasts imply a terms of trade increase at this stage of well over 10 per cent compared with the Budget forecast of 9.4 per cent. These commodity matters, resource trends and agricultural trends are given to me constantly. They appear in various documents at three-monthly intervals and I would advise honourable members who are confused about it all just to look at resource trends and the work by the ABARE. It is all out there in the public place. The estimates can be seen. Estimates can always go wrong, but at this stage we can say with certainty that in terms of commodity prices affecting the Budget, everything is very much on track. The Treasury estimates are conservative, certainly at least for the first six months of 1988-89. The honourable member for Wakefield (Mr Andrew) pointed out the problems of drought, particularly in the Eyre Peninsula and in other parts of South Australia. This is a constant problem. Recently I looked at some figures and found that in 41 per cent of all the months for the past 12 years one Pastures Protection Board area of New South Wales was in drought. Other parts of Australia have suffered drought for 31 per cent of months over the past 10 or 12 years. That means that for more than half the time over the past 12 years great parts of this country have been constantly in drought. That may say something about drought declaration procedures, but I think it also says either that the traditional ways of looking at drought are not working as well as they could or that we need to have a redefinition of drought. When a piece of country, producing certain commodities, is in drought for all that time, perhaps people should face up to the fact that they will have to look at other ways of dealing with the problem. Natural disaster relief arrangements certainly will not address a problem of that dimension, particularly on very big properties. That is why we have revised the rural adjustment scheme funding arrangements. We will then have $28,000 up front. That legislation will come into the Parliament soon and it will enable people who are in an impossible situation to get off their properties with some dignity. I could speak at length about this, but I think the connection between land degradation and drought and the way that farmers can interact with some of the policy measures available to them will probably be the thing to look at in the future. The honourable member for Calare (Mr Simmons) mentioned coal and soil conservation. I will not say much more on those matters. He pointed to discussions by the Australian Conservation Foundation at the weekend about the way in which farmers treat the land. I would simply say that the Minister for the Arts, Sport, the Environment, Tourism and Territories (Senator Richardson) made some pungent points about the way in which we look after our land, but thinking that this can be cured by legislative arrangements is wrong. I believe we need to continue to work with the States, the farmers and those people who look after the land. That is the only way to go on this most vital issue. In some places it is a question of `carrot and stick', with the stick to be exercised by the States and by the Commonwealth Government. But really we must consider more ideas of conservation farming. The reality is that there is an enormous amount of goodwill and thoughtfulness among our farmers to this end. These are issues on which we will have to continue to work. My final point is in response to the honourable member for Wannon (Mr Hawker), who spoke about trade. I have already pointed out that floating our currency probably did more for trade in this country than anything else. The formation of Austrade, the innovative agricultural marketing program and the marketing skills program we are developing, the work we are doing on value-added on early stage processing in wool, the work of the Australian Meat and Livestock Industry Policy Council and the wool initiative with China all point to the fact that this Government has emphasised trade in a way that no other government has. The Minister for Trade Negotiations (Mr Duffy) is overseas now and we are putting every effort into the Montreal meeting of the General Agreement on Tariffs and Trade, the mid-term review. That is the longer term strategy. People quite realistically say that the prospects for getting freer world agricultural trade may be low, but the potential reward will be extremely high. That is the main game in town and we are playing it as hard as we can. I believe we are carrying out short term and medium term initiatives on trade on a day to day approach in every way that we possibly can. Finally, I draw the attention of the honourable member for Wannon to page 411 in the Budget Statements 1988-89. In absolutely no way have I tried to purport that this change in the presentation of the Budget Estimates is supposed to represent a big increase in spending for the farm sector, or the primary industry and resources sector. It is simply the reclassification of primary industry charges and levies from outlays to revenue which has removed a major difference in treatment between the Budget and statistics of the Australian Bureau of Statistics. It was done for better accounting and administration right through the Government. We are trying more and more to get this complete openness, transparency and consistency in Government figurings and the presentation of outlay and revenue figures, just as we are trying to get, and are succeeding in getting, more modern management systems right through the Public Service by taking a better approach to public administration. Proposed expenditure agreed to. Department of Social Security Proposed expenditure, $653,430,000. Mr CONNOLLY(Bradfield)(11.11) —The Government which has produced this Budget has had as its catchcry in recent years `social justice'. This Government came to power more than five years ago believing in compassion and concern, but there are many people in Australia who-as we saw last Saturday in the by-election in Queensland-now regard this Government as one which has lost touch with ordinary people, as one which is arrogant and out of touch with the realities of the circumstances facing the hundreds of thousands of low income Australians who, to one degree or another, are dependent upon the activities of the Department of Social Security and the social welfare policies of this Government. Put quite simply, I believe that most people have lost trust, not only in the rhetoric of the Government but also in its capacity, in an environment of steadily lowering standards of living, to come to grips in any real way with the impact of its policies on ordinary people. Only a few weeks ago the Chairman of Committees, the Leader of the Opposition (Mr Howard) and I addressed some 3,000 retirees and pensioners in Sydney. This was a very large and noisy public meeting organised by Greypower. Anyone who went there would have come away with nothing but the clear view that we were seeing just the edge of a massive rejection of Government policy. There were thousands of people there who had previously voted Labor, but who believed that they had now been forgotten and who were certainly not prepared to forgive the party in which they had previously placed their trust. Much of this has occurred because over the last five and a bit years this Government has failed to implement effectively a viable retirement incomes policy, despite its substantial rhetoric dating back to May 1983. For example, it has not effectively addressed double dipping, which is a problem in our system. It is a matter of great consequence because effectively it means that people who have the advantage of tax support through superannuation have, by one means or another, also been able to get access to the pension-a pension which has been funded by more than 50 per cent of the Australian work force who have no superannuation and who can justifiably argue that they are paying part of their taxes so that other people who have the advantage of superannuation can effectively have two bites at the cherry. The Government has also introduced seven major changes to the treatment of pensioner income. Its last performance in the Budget was clearly an error on which the Minister for Social Security (Mr Howe) was finally required to back down. The Budget was then changed not just because of the noises coming from Victoria, which was then facing an election, and the very real risk of a major pensioner backlash, but also-and more importantly-because the Government was wrong and it accepted that fact, albeit very late in the piece. At the end of the day one thing is clear: there is now a state of massive confusion not only among pensioners and superannuants, not only among investment analysts and those who are involved in the superannuation industry but also, more importantly, among those affected, and anyone in Australia over the age of 50 has reason to be concerned about his or her financial viability in retirement. The vast majority of pensioners who own capital are people who, by their own common sense and hard work, have been able to accumulate modest amounts of capital during their working life. They now face the difficulty of trying to maintain a reasonable standard of living in the face of growing inflation, rising taxation and the onslaught of ever-changing regulations. We have seen successive pieces of legislation which have necessitated often complex calculation and record keeping, not just by large superannuation companies but by small superannuation companies as well. The outcome of all of that is that over the next few years we will see thousands of those smaller schemes going to the wall. They will be incorporated in the National Mutuals, the AMPs and the big five. The outcome of all that will be that the power of the purse will influence not just the decision-making processes of companies in which these superannuation funds have invested, but more significantly even than that, the decisions of governments themselves. That will be the reality of the future because there is no doubt that if we are going to allow a massive concentration of economic power in the hands of a few we will have to do so at a cost. It will be a cost which will be expensive for all Australians in the future. The Labor Government has failed to provide stability and security in retirement to over 2.3 million pensioners despite all the changes that we have seen in both superannuation and pensions in recent years. There have been seven changes to pensions in five years alone in terms of the income test. There have been over 20 major changes to superannuation. In all of that the Government has still managed to increase the tax take on superannuation because fundamentally the reforms it has introduced, despite all the rhetoric, are not about applying a better regime for retirement planning in Australia; they are about increasing revenue. How else can it defend the situation where over the last five years we have seen tax on superannuation alone increase by nearly 1,000 per cent. The Treasurer (Mr Keating) told us that the tax revenue implications of his changes were a mere $1.4 billion. He is wrong; he will be shown to be wrong. He has five sets of tax points. He has applied 1.4 to two of them. What about the other three? How much revenue is he going to get from those three? We do not know; I doubt whether he does either. Nevertheless, we see constant changes to the superannuation arrangements. The last May statement and the last Budget have added further confusion to people who in their later years ask for only two things: financial security, on the one hand, and health support on the other. They are the two most important elements of a retiree's expectation of what he should get from government in the future. What has been the reaction of the industry to these changes? Mr Mayer, the Managing Director of National Mutual Life Association of Australia, the erstwhile ally of the Treasurer, who was quoted on numerous occasions at the time of the last May statement, said: There is quite significant concern about the fact that the legislation is not yet available. It should be better than this. Currently, what we have been doing is running our business on indications expressed by press release. Another industry source said: Many millions are being deducted by superannuation funds and are not being paid to people who are withdrawing. It doesn't have the force of law. We were told at the last Budget that within two months the Government would bring into the House the superannuation legislation to put in law the changes announced last May. Since then we have seen six sets of new changes by press release, by public pronouncement, by speeches but not by act of Parliament. We are now in the enormously difficult situation where people who were meant to be trustees and the trust deed states explicitly their responsibility-- Mr Howe —Mr Blanchard, as I understand it, we are discussing the estimates for the Department of Social Security. I think what the honourable member for Bradfield is telling us about are some changes within the portfolio of the Treasurer and not changes that fit into the estimates of the Department of Social Security. I think that the honourable member should be asked to confine his remarks to the estimates that are actually before us. The DEPUTY CHAIRMAN(Mr Blanchard) —I have been listening to the honourable member. I can see that there is some relevance to the issue before the House. The honourable member can continue. Mr CONNOLLY —The point I was making before that rude interruption was simply this: in a situation where retirement income planning depends on legislation, we have no legislation. The situation is that trustees responsible for superannuation, which is the very basis of retirement income planning for 1.6 million Australians, are now in an invidious position where they are unable to meet their requirements as trustees because they are also expected to be tax collectors for the Commissioner of Taxation. One cannot do it both ways. One cannot obey God and mammon in the environment in which this Government has placed the industry today. The result of all of that is that millions of dollars has been collected. On the Treasurer's own estimate $1.4 billion has been collected in a 12-month period which is not the Government's money because it has no legislation to collect it. The DEPUTY CHAIRMAN —Order! The honourable member's time has expired. Mr LEE(Dobell)(11.21) —First of all I would like to make a few comments about the contribution of the honourable member for Bradfield (Mr Connolly). In one sense I congratulate him for representing his constituents. He, of course, represents an area commonly known as the north shore of Sydney which includes areas such as St Ives. As one who represents the interests of his constituents he has opposed some of the reforms which this Government has brought in in relation to social security. When the previous Minister for Social Security, Senator Don Grimes, introduced the assets test the honourable member for Bradfield and his Party believed that millionaires should still continue to receive a pension irrespective of the level of their assets. There have been some rumours that they are reconsidering their position on that. But, at this stage I understand that the shadow Cabinet has not yet come to a decision. We will wait with bated breath to see what the honourable member for Bradfield does. Also, of course, as a good member for the suburb of St Ives he has opposed the tightening of the income test which this Government has brought in. He is correct that sometimes the closing of loopholes has been very complex. The Government has been forced to introduce some complex legislation to make the income test work fairly. The reason the Government has had to introduce very complex formulas to make the income test work fairly is that accountants and lawyers will go to amazing lengths to find new ways so that people can avoid that income test. Frankly, I think it is unfair that someone in my electorate who lives in Long Jetty and who has a very small amount of money in the bank or building society will start to lose part of his pension once he earns more than $40 a week in interest, yet someone in the electorate of the honourable member for Bradfield who lives in St Ives and who could have hundreds of thousands of dollars invested in a particular deferred annuity trust can continue to get the full pension. I think that is unfair and wrong. I support the Government's moves to change the rules so that the income test for future investments is fair. That is something I support. One contradiction which I thought appeared in the contribution of the honourable member for Bradfield today was his criticism of this Government for not having any retirement income package. He said that this Government has not done anything about double dipping because this Government has allowed people to continue to collect superannuation and then also to collect the full pension. Frankly, I think that is a bit opportunistic of him to make that allegation when he has opposed every attempt that this Government has made to make the system fairer. He should go back, think the system through, and stop trying to be an opportunist scoring political votes every chance he gets. This morning I wish to address three issues in the time that is left to me, that is, firstly, the Child Support Agency; secondly, the need for some reform of independent advice to pensioners on where they should invest their money; and, if I have some time left, thirdly, the eligibility for fringe benefits. I support the Government's principle of introducing the Child Support Agency so that non-custodial parents make a contribution towards the upkeep of children who are living with the other parent. As we all know full well, 70 per cent of non-custodial parents today do not make any contribution towards the upkeep of their children. I support the decision of the Minister for Social Security (Mr Howe) to introduce a system so that the Taxation Office collects a contribution from that non-custodial parent and provides that to the parent who is looking after and rearing the children so that those children do have a standard of living. Mr Connolly —We support that. Mr LEE —The shadow Minister for social security and retirement income, the honourable member for Bradfield, says that he supports that as well. I wish to mention one difficulty that has arisen with this scheme. As part of the package brought in by the Minister we introduced a new income test on maintenance. Previously, people could earn up to $40 a week in interest or maintenance and still receive the full pension. The new system means that, once a custodial parent receives more than $15 per week in maintenance, he or she starts to lose 50c in the dollar in his or her pension. I admit that the Minister introduced a measure which froze the current level of pensions for pensioners and it was expected that the new system would come into effect only if there was a change in circumstances. I had understood that to mean that, if a person received an increase in maintenance or an increase in interest earnings, the new arrangements would be triggered. However, two women constituents of mine who are separated from their husbands receive the age pension and they were getting very modest maintenance but it was more than $15 per week. I was surprised to learn that simple increases in their pensions for consumer price index (CPI) adjustments have resulted in triggering the new arrangements. That has meant that these pensioners have not had a reduction in their pension but they have not had the normal CPI adjustment for inflation. So in real terms they are behind. That is something that I had not expected because we had said that only if there were a change in circumstances would the new arrangements come into effect. I suggest to the Minister that the new arrangements should be triggered only if there is an increase in maintenance or other non-pension income and simple CPI increases should not be considered as something that should trigger the new income test. The second point I wish to raise this morning again goes back to the income test and the confusion that exists to a large extent in the community about what is considered income by the Department of Social Security. I am concerned about some of the investment advisers who, these days, are giving advice to retired people on where they should invest their money. Of course, there are some investment advisers and some investment companies that are competent and reputable and they give good advice. But I am afraid to say that I have come across some cases where constituents of mine who have retired have received very poor advice and, in some cases, they have been asked to pay quite exorbitant fees to these allegedly competent investment advisers. In other cases I am very concerned that perhaps these allegedly independent investment advisers are not independent; perhaps they might be receiving some form of inducement to recommend one form of investment over another. Perhaps the Government should consider providing some form of independent investment counselling through the Department of Social Security or through the Australian Taxation Office, or perhaps we could induce the people's bank, the Commonwealth Bank of Australia, to increase the number of staff that it has available to provide retired people with investment advice. It has been my experience that the Commonwealth Bank, and usually the other major banks, provide good advice to retirees. But I am very concerned that some people who are not properly qualified are claiming to be giving independent and wise advice to pensioners when that is simply not the case. The last point I wish to raise is the question of fringe benefits. This is something which is of great concern to many retired people. They wish to receive concessions on rates, electricity charges, telephone charges, car registration, drivers' licences and other items. In some cases qualifying for a fringe benefit card can mean that a pensioner receives a benefit worth up to $50 a week in cash. So fringe benefits are very important for the security of a retired person. As a result, some pensioners will go to amazing lengths to qualify for that fringe benefits card. We have an income limit and also an assets limit on eligibility for fringe benefits. Often it is very distressing for a pensioner who ends up a few cents a week or even a dollar a week over that limit and then loses eligibility for all his fringe benefits. I know that this is a problem that has existed for many years under governments of all political persuasions. There are cases-of course, the Minister would be aware of these-where pensioners have invested very large amounts of money in interest-free cheque accounts or other interest-free accounts-perhaps more than $20,000-simply so that they can qualify for fringe benefits. The banks are quite happy to receive their money and not pay any interest to them. I just think some pensioners are not investing in their own best interests. So again I think there is need for some independent advice. I wish to support the suggestions of the honourable member for Stirling (Mr Ronald Edwards) and the honourable member for Grayndler (Mr Leo McLeay) that the Government look at a senior citizen's card which could be issued to all pensioners over the age of 70 so that they could receive concessions on transport, rates and other items. I believe that that is something that this Government should consider. It would mean that pensioners would not have to go to great lengths to try to reduce their income or hide their income so that they can receive their fringe benefits card. I am sure that, given this Minister's record, he will take up these comments in the positive manner in which they were made. Mr PRATT(Adelaide)(11.31) —In the committee debate on the Appropriation Bill (No. 1) 1988-89 I wish to speak about the Department of Social Security, under the heading `Secure Retirement'. The Hawke Labor Government has included in its Budget legislation measures that seriously affect the financial security of people in retirement. The legislation, in its original form, certainly had a glaring retrospective effect. Even after a quick patch-up job by the Minister for Social Security (Mr Howe) the retrospective aspect remains. The legislation seeks to include as income for the purpose of the age pension income test-not for taxation purposes-returns from market-linked investments. Market-linked investments include approved deposit funds, deferred annuities, managed insurance bonds, friendly society bonds, equity trusts, property trusts and any other managed or pooled fund or trust. Exempt from the proposed new rules are direct share investments, direct property investments, friendly society bonds bought before the last new year and non-managed investments such as coins, gold and antiques. It is interesting to note that antique clocks remain exempt from the Hawke Labor Government's latest legislative attempt to fatten the Commonwealth coffers, which have quadrupled in size in the past five years. Mr Webster —You could not guess why! Mr PRATT —I could not either! It is the nature of these exemptions which highlights just how intrusive the new legislation is. The legislation, in its original form, would have seen at least 33,000 age pensioners lose their pensioner benefit cards-estimated by the Australian Council of Social Service to be worth between $20 and $50 a week-and part, if not all, of their age pensions as a result of new laws affecting investment decisions made in a different environment. However, industry sources have estimated that those Australians affected would be in excess of 100,000. In addition we must consider the impact that that would have on the dependants of pensioners. People who are 70 years of age invariably have children in the 40 to 50 age group and they are most distraught that their parents might be denied this access in retirement. For weeks these people were stricken with anxiety over the possibility of having to rearrange their meagre portfolios and possibly suffer substantial cuts to their retirement income. The plans of a lifetime of a whole generation were left hanging in the balance. Meanwhile, the honourable member for Hawker (Mrs Harvey), who is from my home city of Adelaide, asked the House by way of interjection: Why should they get special treatment? The honourable member for Hawker went on to say that the `they' she was referring to were: . . . pensioners who, until now, have been able to benefit from a loophole whereby income from market-linked investments is not assessed for social security purposes. The honourable member for Hawker thinks she is talking about the rich retirees of Sanctuary Cove. The honourable member for Dobell (Mr Lee) talked about my colleague the honourable member for Bradfield (Mr Connolly) and the north shore electorate. The people that I have been talking to, the working class constituents and the fair dinkum people whose doors I have knocked on, are in Greenacres, Prospect, Kilburn and Enfield. They are substantial suburbs in South Australia that are not flush with the luxury that the honourable member for Dobell thinks and the honourable member for Hawker believes Australia is full of. Some of these people caught the bus to fill two meetings. I, along with several hundred other people, attended these meetings of the South Australian Council on the Ageing Inc.-SACOTA-to discuss their concerns, and they are all deeply concerned. These people have battled financial hardship all their lives to put a little by to live in dignity in their retirement. The personal grief and mental anguish of these people is tangible, yet this arrogant Government, again out of touch with the electorate, continues to use its sledgehammer-to-crack-a-nut policies, disadvantaging tens of thousands in its mania to prevent one retiree from getting away with one cent that he may not be entitled to, according to its socialist ideology. It is obscene to see just who is being affected by this proposed legislation. I ask honourable members to note that I say `is being affected' not `will be affected'. These people are already suffering. The current generation of retirees have worked their whole lives in the belief that while there was a national superannuation scheme their taxes entitled them to an age pension. The pension has been central to their plans for a secure retirement. Now, since its advent in the 1960s, inflation has added another dimension to retirement and must be accounted for in retirement planning. A 55-year-old may need to fund a retirement equal in length to his or her entire working life, thanks to advances in medical science. A retiree needs some way to secure whatever nest egg he or she has against erosion by inflation, to provide for future expenses such as a new hot water system, clothes, shoes, bed linen and perhaps a new car 10 years down the track. History shows that the purchasing power of $1 in 1972 was reduced to 34c in 1982. They are consumer price index figures. One's nest egg has to treble every 10 years to keep pace with inflation. In recent years a popular method of investing capital for future use has been market-linked investments. These investments are characterised by the fact that the annual returns are ploughed back in. One cannot spend them until the investment matures. The Australian Taxation Office realises that this annual growth factor is not income, but the Department of Social Security wants to treat it as income in assessing the age pension. In a magnanimous gesture, the Minister exempted those involved in market-linked investments prior to 9 September 1988 `to overcome', he said, `the retrospective nature of the legislation'. What about the bloke who retired last Friday or the lady who will finish up at the end of the month? The plans of their lifetime have just gone up in smoke at the eleventh hour. How will these people protect their super lump sums from the ravages of inflation? To make it perfectly clear who is hit by this-- Mr Howe —I raise a point of order, Mr Deputy Chairman. I think the honourable member did not listen to his shadow spokesman who said that essentially the treatment of capital growth had been there for eight years. It was introduced by a Liberal Government. The DEPUTY CHAIRMAN(Mr Blanchard) —Order! That is a debating point. There is no point of order. The Minister will resume his seat. Mr PRATT —A man or woman retiring with less than $20,000-to cite an example-will lose entitlement to a pensioner benefit card. Gone is the entitlement to travel on the bus for 20c a ride-he or she must pay full fare. He or she must pay the gap on all medical expenses and lose free dental cover, optometry rebates, concessions on council rates, water rates, electricity charges and Telecom bills. That is worth between $20 and $50 per week. It is quite a bit to someone on $120 per week. To top it off he or she gets no consideration for the erosion of capital due to inflation, inflation that has been largely created by the Government in the first place. It is not the high rollers at the top of the tree who are hit by the new legislation. As usual with the Hawke Labor Government, it is the little people who are clouted as the Government takes a swipe at the big fish. At least that is what it always claims to be doing. The people who will be hurt by this legislation are those at the bottom of the income scale. Many people will be forced to put their capital in an interest free account, such as a cheque account. This matter has been debated before. Over time, as pensioners use up their capital in order to make up for a smaller pension, the investment income will decrease and thus their pension entitlement will increase. Rather than make Australians less reliant on pensions to fund their retirement, the Government is actually making people more reliant on pensions. The Government is discouraging people to seek financial independence; the very thing Australians should be striving for. As the baby boomers move through middle age and begin the leg to retirement, everyone will have to provide for a pensionless retirement. The Oxley by-election landslide is another episode in the Hawke Labor Government's refusal to acknowledge the electorate. We beat Labor in Adelaide and, as the member for Adelaide, I can tell the House that the conversation in the front bars of the working men's pubs, not on the north shore or in the electorate of Dobell, but up and down Main North Road, is about superannuation and the pension. The main cause for concern on the doorsteps from Ingle Farm to Klemzig is superannuation and the pension. This social security legislation, tucked away in the Appropriation Bills will blow up in the Hawke Government's face-and so it should. I say to the Government: hands off the livelihoods of our parents. Stop hitting the pensioners who have spent their lives building and defending this country. How about a fair go for the elderly? Mr CONNOLLY(Bradfield) —Mr Deputy Chairman, I wish to make a personal explanation. The DEPUTY CHAIRMAN —Does the honourable member claim to have been misrepresented? Mr CONNOLLY —Yes. The DEPUTY CHAIRMAN —The honourable member may proceed. Mr CONNOLLY —The Minister for Social Security (Mr Howe), in a point of order during the speech made by my colleague the honourable member for Adelaide (Mr Pratt), referred to a statement I made and mentioned the words `eight years'. The point he seems to have ignored is that the old rules were in place for eight years. I will quote from the rules in the manual of instructions of the Department of Social Security, which states: If the investment is market-linked: i.e. the value can vary up and down, income is assessed only on maturity or where a withdrawal is made, regardless of when the investment was purchased. That is the eight years I was referring to. The Minister has now changed the rules. The Hawke Government has been in power for over 5 1/2 years-- The DEPUTY CHAIRMAN —Order! The honourable member has said where he was misrepresented. Mr HOWE(Batman-Minister for Social Security) —Mr Deputy Chairman, I claim to have been misrepresented. The DEPUTY CHAIRMAN —Does the Minister wish to make a personal explanation? Mr HOWE —Yes. The DEPUTY CHAIRMAN —He may proceed. Mr HOWE —I do not think what I said varied at all from that explanation. I was simply saying that the change was to the treatment of that income on an accrual basis rather than at the point of maturity. That, of course, means in principle. The honourable member has been running around the country attacking the Government for what the Opposition has been doing itself in that period. The DEPUTY CHAIRMAN —Order! The Minister will resume his seat. Mr WRIGHT(Capricornia)(11.41) —It appears from the comments made by the honourable member for Adelaide (Mr Pratt) that the Opposition is pursuing its campaign of targeting pensioners to try to score political points around this country. It is a pity it did not start telling people some of the facts, the truth. I am glad that the Minister for Social Security (Mr Howe) interjected by way of a point of order to explain the truth in relation to the allegations made previously. It is almost shades of Peter Sawyer, with Sawyer running around saying that the Government will take away pensions and introduce some sort of voucher system. Honourable members opposite repeatedly create confusion and misunderstanding, and a false perception of what the Government is doing. Clearly the Government has listened to the desires and demands of people. It has acted on those needs, obviously in line with restraint and equity. In these economic circumstances that is a must. Let me make some comparisons and explain what is happening to the lot of the pensioner. It will never be perfect, but this Government is conscious of those who are on lower incomes and those who are disadvantaged in our community, particularly from a purchasing power point of view. Prior to 1983 the tax free threshold for pensioners was $5,428. It is now $6,892-a massive increase of over $1,500. The provisional tax threshold at that time was $1,000. So a pensioner who earned $1 more than $1,000 over and above the pension paid provisional tax. That allowable income-the pension, interest and dividends, the lot-has been increased to $10,332. It means, for instance, that a married pensioner can now earn another $5,000 from interest and dividends and not be faced with paying provisional tax. Who introduced this measure? It was the Labor Government on the initiative of the Minister for Social Security who is sitting at the table. The tax-free rebate was $250. In other words, a person could earn at that time around $1,000 without paying tax. That pensioner can now earn over $1,700 because the rebate jumped to $430. The allowable income of $30 has increased to $40 for a single person; for a married person it was $50 and it has gone to $70. The single pension in 1983 was $77.25; it is now $120.05. The pension for each of a married couple at that time was $64.40; it is now $100.05. To give honourable members an example of the purchasing power of people in 1983, pensioners on $10,000 paid $1,371.50 in tax. Five years later the tax payable on the same amount has dropped almost $250 to $1,134. Rent assistance was $10. It will increase in July to $20. In 1983 the pension amounted to 22.7 per cent of average weekly earnings; today it is almost 25 per cent. The average payment to the aged in 1983 across the board-that is over 1.3 million pensioners-was $3,435 per person; today it is $5,478. There is a real increase over inflation. Pensions have been increased by the inflation rate plus another 8.2 per cent. A married couple now can receive a part pension until their income is 97.2 per cent of average weekly earnings. Yet we have members of the Opposition saying that we are doing nothing. Of course there will be some problems, but we are trying to address the economic resources of this country firstly to those who are in need. That has been proved by the Minister's own initiative. He announced in the recent Budget that the 12 weeks bereavement payment is now tax free. Previously, it was possible for a person to receive 12 weeks payment if a spouse died and at the end of the financial year to be suddenly hit with a tax burden because that payment had to be included as income. Because of requests made by me and other members to the Minister, and on his own initiative, the Minister announced in the Budget that bereavement payment was to be tax free. It can now be obtained in one lump sum to meet funeral costs. That is something the Opposition never thought of; it was never even considered. The bereavement payment was lumped in as income and taxed. A pensioner could receive an extra $1100 and pay tax of about $330, and nothing was done about it. There is a need for change; I accept that. There is a need for allowable earnings to be tax free. If I have any criticism of the system, it is that there does not seem to be coordination between the Australian Taxation Office and the Department of Social Security. That is certainly not the fault of the Minister for Social Security or of the Treasurer (Mr Keating). However, we need to work together and ensure that if a pensioner can earn $40 a week, or a married couple can earn $70 a week, that ought not to be taxed. There is confusion, which, unfortunately, Opposition members grab hold of and spread, creating trauma for many aged people. There is also a need to index the tax rebate. We addressed that need in the Budget by increasing the tax rebate from $250 to $430, but because it was not indexed there was an erosion. A person could earn up to $6,142 without paying tax but as a single pensioner he was getting $5,900 anyway in his pension, which gave him barely $200 a year to earn because of the tax rebate-a matter of a few dollars a week. There has to be a reconsideration of this position. I hope that there will be, as a result of the representations that have been made to government. We have to do it that way. I hope we take an apolitical position on this. Pensioners should not be political targets. We ought to show them special respect and, regardless of our political persuasion, we should help them en masse. If we take into account the veterans, we are talking about two million people out of a population of 16 million. At the moment there is a pensioner for every five people in the work force, but by the year 2025 there will be a pensioner for every two people in the work force. There will be many more pensioners who will need to be considered. So, as I said, there is a need to review this position on an apolitical basis. There are also concerns about the assets test. I have directed this matter to the Government and I hope that we can take it up further. We have an assets test in place, which is necessary, because we do not want a person who owns $1m-worth of land getting a pension if that land could be sold, creating an income for that person. I know that is the position of some honourable members opposite. Assets valuation was set in the last two years. The Taxation Office is now revaluing those assets. Only recently, certain land which in the last 12 months was said to be worth $90,000, suddenly became worth $146,000 and there were no sales in the area. I do not know how it happens. I have asked the taxation valuers to sort it out for review. But that takes time and it causes stress, because immediately the Department of Social Security acts on a valuation there is a diminution of the pension received. The person does not have another source of income. He has a piece of land which he has not sold-in some cases he cannot sell it-and he is caught with a lower income. That means less purchasing power and a reduced quality of life. We need to review the position. This brings me back to my point that we need coordination. We should not have one department, be it the Taxation Office or the Department of Social Security, running out on one tangent and the other department doing something else. That is certainly true when it comes to the allowable income earned and valuing the assets of pensioners. I would like to see some independent assessment made, because there is constant confusion over the income test and how it applies as against the assets test. Our responsibility ought to be aimed at the quality of life of these people, people who have worked hard for this country, who have pioneered it. I believe that they deserve something better than the confusion and trauma that has been created by the likes of Peter Sawyer and, regrettably, a minority of Opposition members-sometimes because of sheer ignorance, because people just do not know. I have noted with some pleasure the Minister's willingness to try to improve pensioners' knowledge of their rights and the delivery of Commonwealth services in country areas. The Commonwealth Employment Service and the Department of Social Security have combined in many areas; my own township of Biloela was used as a pilot scheme. We need to ensure that people know their rights. We also need certainty, consistency, stability and simplicity in the laws and rules that people have to adhere to. I make one final point as my time disappears. Let us get rid of the anomaly that exists whereby senior citizens organisations can get a sales tax exemption but pensioners leagues cannot. Again this demonstrates the confusion and inconsistency that exists and the lack of cooperation and coordination between the two departments. In all, this Government is working to achieve equity and improve quality of life for the aged. However, we must ensure that we remove the anomalies which, unfortunately, exist. Mr WILSON(Sturt)(11.50) —The honourable member for Capricornia (Mr Wright), who has just resumed his seat, talked about the confusion facing many pensioners. What he has failed to acknowledge is that the confusion, concern and worry that confront many pensioners have been directly caused by the Government he supports. He talked about the low level of income at which a pensioner first faces an income tax liability. Who caused that? It was the Labor Government, by failing to index the tax threshold, not only for pensioners but for all taxpayers. That has meant that since the Labor Party has been in office the tax-free area between the pension income and the tax threshold has narrowed continually. It has been alleviated only by ad hoc adjustments to the age pension tax rebate. As the honourable member for Capricornia pointed out, that still leaves only a relatively small amount of income that a pensioner can have before he faces an income tax liability. What does that mean? It means that many pensioners must put in tax returns. They have to define their income, which means more confusion, because one month pensioners receive from the Department of Social Security a statement requiring them to disclose the income received. That is easy, one might think. But this Government has introduced a very complex definition of income for pension purposes and a different, and equally complex, definition of income for income tax purposes. I support the honourable member for Capricornia when he says that the Australian Taxation Office and the Department of Social Security should get together. The Treasurer (Mr Keating) and the Minister for Social Security (Mr Howe) should get together. They need their heads banged together so that they will try to simplify and clarify the income test and the income tax test in a way that makes the definition uniform for both systems. Earlier in this debate reference was made to changes in respect of managed investments. The Government has only recently, in the May statement, further complicated the whole process by defining as income for income test purposes receipts which, under the income tax legislation, are regarded as capital. For example, a pensioner selling an asset for a price higher than the price at which that asset was purchased is liable to bring in the nominal capital gain as income for income test purposes, not the real capital gain as is the case with the capital gains tax. Is the Minister able to assure the House as to the position of a pensioner's residence? As I understand it, according to the department, a pensioner's residence is a domestic asset. Therefore, if a pensioner sells a house and buys another, but in the process makes a capital gain on the house sold, the capital gain is not income for income test purposes. I hope that the Minister can assure me that that is the case. I would have thought that a domestic asset was more like the furniture, the pots and pans, the garden utensils and implements. The Minister may be able to reassure me. Nevertheless, if the pensioner is selling a modest beach house because that person has reached an age when he or she cannot travel to the coast and a capital gain is made, that capital gain is brought into account as income for income test purposes-not the real capital gain but rather the nominal capital gain. For how long is that income brought into account and over what period? One has to go through a maze of complex administrative instructions to discover whether the gain is averaged over a year or brought into account in the week in which the capital gain is received. It is not clear. It is different from assessment for income tax purposes. The honourable member for Capricornia has a huge job on his hands in trying to persuade this Minister for Social Security and the Treasurer to get their act together so that there is a common definition for income under both systems. The pension system is really the reverse side of the coin from the tax system. Most age pensioners have formerly been taxpayers and they, properly in my view, believe that as they have been taxpayers they have earned the right to the pension that they receive. Having earned that right, being entitled to that pension but subject to an income test and subject to an income tax test, surely it should be made simple for them. They should be told what is income. The same definition should be used in both systems. These people should be told that, instead of having to notify the Department of Social Security within 14 days of an adjustment of income, they have 12 months in which to give that notification, provided the income variation is not substantial. That is done under the tax system. There, one pays provisional tax if one has a high level of interest or similar income and if the income varies, one's provisional tax can be varied. Why should not the same system apply to age pensioners? I would apply it to more than age pensioners. A few weeks ago the Minister gave a response to a question in the House and tried to justify this intrusive fortnightly review of pensioners' incomes. He said that a pensioner has to be given income in a particular week because he has no other income, therefore he must be assessed in that week. Most age pensioners are living in predictable income circumstances and for the life of me I cannot understand why we do not tell people who reach pension age to put in a return once a year just as they put in their tax return before they retired. If the Government underpays a pensioner because it has thought the pensioner would receive a higher income than was actually received, the Government should make an excess payment to bring the pension payment up to the entitlement. The Commissioner of Taxation does that for people who overpay their tax through the pay as you earn system. If, on the other hand, a pensioner-who by definition is a part-pensioner, because it involves only those who have their pensions adjusted because of other income or assets-receives a higher level of non-personal income than would entitle that person to the rate of pension actually received, why could not that pensioner then be sent a debit account to pay back the overpayment of pension? Perhaps an instalment could be deducted fortnightly for a certain period of time until the overpayment had been recovered. If there is a fear that these pensioners will die or run away overseas to spend the investments from which they are getting the interest, upper limits could be placed on the amount so that if a pensioner receives $500 or $1,000 more than his previously declared income, an appropriate notification must be made to the Department. The illustrations I have given make it clear that there needs to be much closer integration of the function of the Department of Social Security and the Taxation Office in the area of the definition of income, in the requirements of each of the departments and the Taxation Office imposed on pensioners in respect of the times and places they must fill in forms setting out their incomes and assets. Surely in the area of assets there should be a similar definition for income derived from assets as in the case of the capital gains tax. The DEPUTY CHAIRMAN(Hon. J. D. M. Dobie) —Order! The honourable member's time has expired. Mr WEBSTER(Macquarie)(12.01) —I raise two items in discussing these appropriations for the Department of Social Security. The first is once again the matter of earning limits for the widows pension. I have made a habit of raising this matter every time these appropriations are discussed. The Government has set up a new jobs, employment and training program to help work force re-entry for widows and sole parents. There is no doubt that this program will fill a gap, and I commend the Minister for Social Security (Mr Howe) for that. I know that the Minister has at times a compassionate heart; albeit that those times are too rare, they do occur from time to time. The area of widows' earning limits needs to be thought about very carefully. The greatest barrier to gradual work force re-entry of widows and single mothers, combining work with parenthood while receiving adequate income and work experience, is the current cut-off point for benefits once a woman starts to earn an income. Every day when we come in here Madam Speaker says a prayer seeking guidance. I know the Minister is very well aware of the scriptural injunction that we take special care of widows, and they do get some pre-eminence in the care that we as people, as governments, exercise. It is important to say that because that responsibility does not stop when we come in the front door of this place; it becomes a great reality when we legislate here for our fellow humans. I urge the Minister to look not at some marginal lift in the wage benefit cut-off point but at a significant boost to the amount a widow can earn before she loses benefits. At present she can earn $40 and I believe one of the serious deficiencies in this system is that widows, who have great family responsibilities, and many of whom are very young, are being forced out into the cash economy. In fact, this is forcing them into engaging in criminal activities. If they earn cash in excess of that $40 that is not accountable they are engaging in a criminal activity. We must look hard at this concept of raising the threshold, particularly for widows, for the earnings they can receive before their pensions are reduced or removed. The second matter I raise concerns the need to ensure that increased disposable income for low and average income families is achieved through less taxation rather than greater dependence on government benefits. One of the classic works of liberalism is the book The Servile State. I am sure the Minister, who is widely read in these matters, will have read it. It warns against the development of a society characterised by utter dependence on the state for income security-a fairly serious warning. There is no doubt that our welfare system needs the mechanisms of redistribution and targeting for a good many people who are unable to care for themselves or their families in times of difficulties. We know that. Nevertheless, I must say that I find it dangerous that real improvements in disposable income have come to many working families from welfare payments when they could have and should have been achieved by tax cuts. Getting a person a job and then letting him keep his earnings, rewarding self-reliance, minimising reliance on the state-these should be the key social objectives. It is neither good for the individual nor prudent politically constantly to increase the level of reliance on the state for income security. I point out that real improvements in disposable income and living standards should come as far as possible-I know it cannot be done in every instance-from tax cuts. That is, increased disposable income can and must come from the state getting off the worker's back as far as possible. There is a lot of room for this to be done in this portfolio. I raise the question, therefore, of whether the Government can review its social justice strategy with a view to giving welfare payments less of a role in future growth in disposable income for low and average income earners. It is better for self-esteem if a person is able to live off the income that he or she receives with reduced taxation rather than to have a taxed income and have it supplemented by benefits from taxation. I suggest that the Government shift the balance of tax to tax cuts, which produce independence as well as improved living standards. I urge the Minister for Social Security to consider these very brief points. I am sure he will. Mr HOWE(Batman-Minister for Social Security)(12.07) —I want to thank the contributors to the debate and make just a few comments on various issues that were raised in the course of the debate. I was somewhat surprised that the honourable member for Bradfield (Mr Connolly) raised the question of the Greypower meeting in Sydney and my non-attendance at that meeting. I suggest with some care and sensitivity to the honourable member, whom I respect, that he do a little research before he attends another meeting which is chaired by Robert Clarke. I do not make any imputations about the character of this individual, but I think it is important that Opposition members, when they attend meetings, are careful who they associate with. In particular, I suggest that the honourable member might like to consult page 99 of Mr Grassby's book The Morning After, where he refers to some of the previous activities of the said Robert Clarke. A number of issues have been raised in the debate. On the question of market linked investments, I am very interested in the Opposition's position on this, although it has not been altogether clear what it is on about. It is certainly not clear that it has held a consistent position. The honourable member for Bradfield has referred constantly to the fact that the treatment of capital growth as part of market linked investments has taken account of income at the point of maturity of those investments since 1980. That is, those rules were introduced by a conservative government. In the years between 1980 and 1983 I am sure there was no suggestion made by the Government of that time that some account should be taken of inflation. It took no initiative. We now have a position where, as part of a scare campaign generated by some people in New South Wales, the Opposition has jumped onto the bandwagon and has not referred to the fact that all the Government has done has been to move the treatment of this capital growth factor to an accrual basis rather than at the point of realisation. In principle, the Opposition introduced the treatment of those market linked investments and capital growth funds in a way that took account of that capital growth disregarding inflation. We get a lot of nonsense, if I might say so, spoken in this Parliament and I think we have had some nonsense spoken in relation to this issue for what could be regarded only as extremely opportunistic reasons. With respect to other contributions on the issue of the aged population, the Government is very concerned to achieve a retirement income policy not only for the next few years but to serve us well into the early years of the next century. As part of the social security review we have had Professor Cass looking at the issue of retirement incomes and she is about to publish her issues paper No. 6 around that theme. The Government has made a number of changes with respect to occupational superannuation, making it much more available to the work force than it has ever been before. We have also made a number of changes to provide incentives for people to preserve money invested in occupational superannuation for the purposes of providing a retirement income. In the next few weeks, as that paper is published, the Government will move to give consideration to making some time next year a major statement on the issue of retirement income policy. We make no apologies for measures which were designed to ensure that our income-tested system operates in a fair way and indeed in a targeted way. The Government introduced an assets test, reintroduced a means test for the over 70s pension, and has moved to ensure that our system is targeted. That is necessary, given the very difficult fiscal climate in which the Government has operated. At the same time, as the honourable member for Capricornia (Mr Wright) pointed out, there have been very significant increases in the real incomes of age pensioners in this country-increases in the rate of the pension of 8.2 per cent real. We are now at 24.8 per cent of average weekly earnings in the level of the pension. We have eased income tests in the free area from $30 to $40 and from $50 to $70 for married couples. We have moved to ensure that fringe benefit limits are indexed and indeed we have indexed the limits with respect to the age pension. We cannot look at the Government's policy with respect to the aged only in terms of what it has done in income security. The Government has also sought to put in place far-reaching restructuring of nursing home and hostel accommodation for the aged. That is designed to support our policy of ensuring that aged people are able to remain as active as possible. The home and community care program is a visionary program which will certainly support the aim of helping people to remain within their own homes and within their local community for as long as possible. Within the tight fiscal framework in which we operate we have needed to give emphasis to targeting, but we have sought to achieve some real increases in disposable incomes of age pensioners. We will in the next few months set out our objectives in long term retirement income policy. There will be ample opportunity for debate within the community. My hope is that we can get a consensus within the community with regard to the directions of retirement income policy. The issue is too serious for people to be subject to changes every time there happens to be a change of government. They need to know what the ground rules are. What we are talking about is an increase in the proportion of the aged population-those aged over 65-from about 10 per cent currently to about 16 per cent in 2011. So in the next 20 years we need a farsighted retirement income policy that has broad support within the community-amongst the aged themselves, political parties, industry and those who represent aged people. I will certainly be working very hard to achieve the basis of that policy. I am sure that the paper by Bettina Cass will be an extremely helpful resource to the community as well as to the Parliament in considering these issues. That, together with a number of background papers, will represent a very substantial resource in terms of documenting what we know about the ageing of the Australian population and issues that are relevant to that. I will not take up much more time. A number of other contributions have been made-for example, by the honourable member for Dobell (Mr Lee), who indicated some concerns about the changes in relation to the income test on maintenance, particularly in regard to aged people. I am currently looking at that issue. I cannot make an immediate response, but we are trying to deal with the kind of situation that he had in mind in that area. The Minister for Consumer Affairs (Senator Bolkus) and I are looking at the issue of investment advisers. We are not looking at that as a Government function, or as a function of the Department of Social Security, but we think it is important that there be access to objective advice for pensioners who often make quite difficult investment decisions. The honourable member for Adelaide (Mr Pratt) made a rather emotional speech. It was typical of the opportunism that one often sees reflected in Opposition comments. He ought to think through the issues a bit more. Perhaps he will have the opportunity to do that within the party room as the Opposition discusses its retirement income policy. Finally, the honourable member for Sturt (Mr Wilson) made a very strong plea for simplicity. Of course, that is a central issue that will be looked at by the Government in its response to the retirement income paper by Professor Cass. It is one for which I have some sympathy, although I think that the notion that somehow one can take the treatment of income by the taxation system and proceed with a similar definition in the social security system is a little more complex than the honourable member suggested. In terms of social security, we are very much concerned with the immediate availability of funds and access to those funds. That is not quite the same issue in relation to the equity concerns of taxation. The point that we ought to have simpler interaction between the tax and social security systems is well taken and one to which I will give further consideration. I thank honourable members for their contributions to the debate. Proposed expenditure agreed to. Department of Administrative Services Proposed expenditure, $1,362,935,000. Mr RUDDOCK(Dundas)(12.20) —Mr Deputy Chairman, I thank you for facilitating the opportunity for me to be able to participate in this debate. I therefore commend you for your chairmanship. As I am talking about the estimates for the Department of Administrative Services, I am pleased to see that the Minister for Administrative Services (Mr West) is present, accompanied by, I am sure, his very able officers. I take the opportunity of canvassing particular aspects of the expenditure of the Department of Administrative Services. In doing so, I note that the amounts of money involved are very large. I lament, in a sense, that the procedures of this place, unlike those of the Senate, do not necessarily permit a detailed examination of Estimates and, therefore, a useful dialogue on some of the issues that might be raised. It is very much a question of a contribution by me in relation to the issue that I intend to press, and a response by the Minister. It may well be that a dialogue would produce much more valuable information than might be elicited by the technique that currently exists. I think it is a matter that we will have to examine in the future. As I understand it, increasingly, as we have procedures for ensuring efficient operation of departments, with performance monitoring against objectives, the question of whether the task of examining Estimates is effective will decide whether this Parliament provides any useful input into the way in which departments operate. The area that I intend to address relates to the function of the Australian property services. The amounts of money involved are large. If one looks at the appropriation for rent for office and other accommodation for departments, the extimate of expenditure for this year is $397,000,000. With other services, involving equally large sums, the amount involved is $459,250,000. When overseas property services are added, the amounts of money involved become larger. Division 119 relates to the fitting out of leased premises by the Commonwealth, which involves another $80m this year. These are very large sums of money. Those large sums of money could well involve very considerable losses of Commonwealth money. There could well be expenditure patterns which are less than efficient. It could well be that there are serious matters relating to the administration, not necessarily of the Department of Administrative Services, but of other departments, and the way in which money is spent. The particular concerns I have are in relation to the fitting out of leased premises by the Department of Administrative Services. They relate to the Commonwealth's involvement in the supervision and fitting out of the Commonwealth Centre in Parramatta, which is close to my constituency. Honourable members would know that the building erected at Parramatta which is presently being fitted out is one which has been erected on a lease-purchase arrangement. It is a new arrangement for the Commonwealth. The building is very large and it is one that is to be occupied eventually, as I understand it, by the Department of Social Security, the Department of Veterans' Affairs, the Department of Administrative Services, and some aspects of the Australian Taxation Office. So it is a very large operation involving the coordination of the occupation of that building in the fitting out stage of many other government departments. As I understand it, in fitting out this building there was an effort to install a telephone system which was to be the largest of its type. We are all familiar with these PABX arrangements for large buildings. The telephone service was to be the optimum type, known as an NEC 240 UMG, and that was to have all of the departments connected to it. It was to have links to other systems outside of the building itself. It was designed with the most sophisticated equipment for safeguarding its use by users of the building. The expenditure involved in the purchase of that equipment was about $3m. As I understand it-the Minister might like to confirm this when he responds to me-the design phase involved the Department of Administrative Services coordinating with other departments to ensure that their needs were met. I assume that that is what they did. The Minister might like to give me certain assurances in relation to the way in which those negotiations were undertaken, the discussions that took place and the result of them, because-and the Minister might care to confirm this or otherwise-after the decision to purchase the equipment had been taken-that is, $3m of public money committed to the PABX system for building-wide use to satisfy the needs of all the client departments, and that done in consultation with them-I understand one of those departments, the Tax Office, decided that that system no longer met its needs. Mr N.A. Brown —That is extraordinary. Mr RUDDOCK —I ask for the Minister's confirmation-and that is why I say I am not satisfied that these procedures are altogether adequate for eliciting information-that the Tax Office now has decided to install its own PABX, an NEC 240 MMG system. Mr N.A. Brown —How much is that going to cost? Mr RUDDOCK —I do not know the amounts involved. The Minister may be able to help us with that answer, but it could well be in the order of additional millions of dollars. It is a smaller system and not quite as advanced, but apparently the Tax Office has some views that the security arrangements for the original system were not satisfactory for its purposes. It wanted to have a unique system, presumably for privacy reasons. If I thought those privacy reasons were appropriate, I am sure they would have been appropriate when the original discussions were entertained. I do not think they would suddenly emerge at a later point in time. But apparently they were seen to be of sufficient importance that the Department of Administrative Services was borne upon at the highest of levels to cooperate with these new arrangements. If that is the case, I think it is appropriate that the House be informed. As I have mentioned, the installation of a separate telephone system means that much of the equipment, cabling and hardware involved in the original PABX system is now redundant. The system will have considerable surplus capacity. I am sure the Minister's Department would seek to deal with this matter properly and perhaps sell off some of the equipment. I am informed that there is not a ready market for subselling advanced equipment of a part of a system, but no doubt they are trying to minimise the losses that are involved. However, regrettably, at the point at which this decision had to be reworked, I am told-and the Minister could perhaps inform us better on this matter-that it was not possible then to review the contracts; it was not possible to renegotiate them. I am also informed that there may well be considerable other losses involved, losses in terms of the decision-making time of the departmental officers involved in producing the original design arrangements and undertaking the consultations, the redesigning of the equipment, as well as the direct equipment costs. This is all in addition to the Tax Office having itself designed and installed a separate system of its own. The DEPUTY CHAIRMAN(Hon. J. D. M. Dobie) —Order! The honourable member's time has expired. Mr HOLLIS(Throsby)(12.30) —I am pleased to speak at this stage of the debate. We are dealing with the Department of Administrative Services and, as the honourable member for Dundas (Mr Ruddock) said, it is quite a significant amount of money-about $1.7 billion. Although that seems a lot of money, the Department of Administrative Services draws its functions now from nine portfolios of the previous Administration. The main ones of these are Housing and Construction, Local Government and Administrative Services, and Special Minister of State. I listened with interest to what the honourable member for Dundas said, and I suppose it is a debatable point whether we should have a more effective scrutiny system, such as that which exists in the other House. I am not familiar with the telephone system in the building at Parramatta, but a lot of this work that comes under the Department goes to scrutiny in other forms. Also, of course, the Public Works Committee scrutinises all these works. The broad range of the operations of the Administrative Services portfolio is emphasised by the allocations made in the 1988-89 Budget. In each aspect of its work, the portfolio fulfils roles vital to Australia's future. The portfolio is a provider of common services to other departments and agencies, a provider of specialised technical services, and manager of the Commonwealth estate and capital works program. The Budget allocation reflects the importance of the Department. One important aspect, of course, is the management of government records. The objective of this program, administered under the Archives Act, is to ensure that the body of records generated by Commonwealth agencies from Federation to present day is managed efficiently and consistently in order to promote administrative economy and efficiency and to satisfy the needs, rights or interests of agencies and the public. During 1988-89 the Archives expect to achieve through enhanced automatic data processing operations more efficient access to a range of essential information relating to the internal management of records in custody and its dealings with agencies and the public, and this will cost about $400,000. The Archives expect to acquire further repository facilities in Canberra. The facility in Hobart has recently been handed over. It is a building especially designed to meet the requirements there. There is also the Melbourne office. Worthwhile savings will be achieved through the vacation of leased premises in Canberra. In addition, other leased premises in Melbourne will replace substandard accommodation for staff and public users at Brighton. It is a matter of personal regret to me, and a matter I have brought up with the Minister, that the Government has not made a decision to proceed with a national archive building. I urge the Government to give consideration to this matter. I believe that a prestigious building should be constructed on the site already allocated in the Parliamentary Triangle. This site is adjacent to the National Library of Australia and the just-opened splendid National Science Centre, and, together, all three would complement each other as great access to information and information retrieval centres. Another important aspect of this portfolio is the Overseas Property Group. We see that major new projects will commence in 1988-89, including the construction of a new chancellery, 43 apartments and associated recreational facilities in Tokyo; construction of two houses on a residence site in Washington; development of a new residential site in Washington; development of new residential accommodation in Port Moresby; conversion of leased residences to chancellery and Head of Mission residence and other residential accommodation and recreational facilities in Hanoi; and the extension of the chancellery building in New Delhi, which I believe is very important. Anyone who has visited our mission in New Delhi will agree that we have to do something about it. Also included in the projects are residences in the Solomon Islands. I note that there have been delays in the construction of our embassy building in Beijing. I know that the Minister is concerned about this and has recently moved to speed up the process but there is concern that there have been considerable delays in the building of that new embassy. That embassy should come on stream as quickly as possible. Another part of the portfolio deals with this very building, the new Parliament House. As we know, the Parliament House Construction Authority was established in 1979 to undertake the design and construction of the new Parliament House. Now that we have moved into this building we find there is an allocation of $82m for further work on it. Although I am very pleased to be in this new building, I must point out that there are some deficiencies in it. I hope that these problems will soon be ironed out and will result in the better working of this building. A lot of people in my area talk about this building as a new Taj Mahal for the politicians and make other extravagant claims about it. I have always argued that, although it is very nice that we politicians at last have decent office accommodation so that we can do our work, this building is for all Australians. It is one in which all Australians can take pride. It is very important that the building be able to work to its full capacity. I return to the comments made by the honourable member for Dundas about the scrutiny of aspects of this portfolio. I am very involved in one area of this portfolio, the Public Works Committee. The Committee has frequent contact with the Australian Property Group and the Australian Construction Services. The Public Works Committee Act is now administered by the Department of Administrative Services. Under this Act the Government is involved in a wide range of works and these works come before the Public Works Committee to receive the scrutiny that the honourable member for Dundas was talking about. Recently we looked at the new Commonwealth centres in Sydney and Melbourne. There has been a lot of defence work, such as the upgrading of facilities at HMAS Cerberus and the Holsworthy military police complex, new government offices at Logan City and work on the Derby Airport. All these important matters have come before the Public Works Committee and have received scrutiny. The Minister for Administrative Services (Mr West), who is at the table, is always very helpful to the Committee, as indeed are the officers from the Australian Property Group and the Australian Construction Services. When they appear before the Committee they are always well briefed and helpful. As has been said, we are dealing with a large amount of money when looking at the appropriations for the Department of Administrative Services. But when one looks at the range of areas covered by this Department one realises why this allocation is so large. We have the Australian Property Group, the Overseas Property Group, the Australian Construction Services, the Australian Archives, the Australian Government Analytical Laboratories, the Australian Protective Services, the Bureau of Meteorology, the Purchasing and Sales Group, the Parliament House Construction Authority, the Australian Surveying and Land Information Group, the Parliamentary Services and Information Group, the Australian Government Publishing Service, the Transport and Storage Group and the Australian Electoral Commission. In conclusion, I wish to give the Government and this Department credit for establishing the Royal Commission into Aboriginal Deaths in Custody. I believe that that inquiry has served a very useful purpose. Often it has not done Australia a lot of credit, but it was very necessary that the Government establish this inquiry which has received an allocation under this portfolio. Mr N.A. Brown(Menzies)(12.40) —In the few minutes before lunch I wish to address a few remarks to a matter falling within the portfolio of the Minister for Administrative Services (Mr West). This matter was touched upon in Question Time yesterday and it relates to Commonwealth purchasing procedures. I understood the Minister to say yesterday-and I understand it is the case, from general talk around the place-that there is a proposal to change the procedures followed by the Commonwealth in its purchasing policies and practices. There are regulations applying at the moment and they are subject to the general proposition that at least for large purchases there should be a general tendering procedure. With some blemishes on the side, that tendering procedure has basically stood the test of time. There is a proposal to make that procedure more flexible-I think that is the euphemism-but what that really means of course is that in some cases it will be done away with. I want to make two comments about that. The first is that the Government should think very carefully before it makes any substantial inroads into the current tendering system. Secondly, I have had occasion recently to look at a few Government purchasing activities which are conducted subject to the present tendering procedures and they have left me with some concern, to the extent that I think any weakening of the system would make that system even worse. In other words, if one looks at a matter which has gone through the tendering procedure and concludes that that was sloppy, did not give the taxpayer good value for his money and was subject to if not improprieties then certainly shortcomings in administration, for that reason alone one should think very carefully before abandoning a tried and tested tendering system. Some of those matters which I have had occasion to look at have arisen at the international terminal building at Sydney (Kingsford-Smith) Airport, and one of them relates to the concession or franchise which the Commonwealth allows to run shops at the airport. These are particularly valuable franchises and concessions-indeed, they are worth many millions of dollars. Recently I have been looking at the concession for the newsagency and gift shop at the airport. In this case the Commonwealth called for tenders, tenders remained open, but a very curious and interesting thing happened during the period for which tenders were open. The Trade Practices Commission drew to the attention of the Federal Airports Corporation that some provisions of its tender contract-the contract on which tenderers were tendering-were in fact in breach of the Trade Practices Act. That was a very serious matter. Here was the Trade Practices Commission saying to a Federal corporation, `Look, you have put out a draft contract on which companies are tendering, and some provisions of that draft contract are in breach of the Trade Practices Act'. Honourable members may well ask: What happened then? The Federal Airports Corporation conducted an examination of the draft contract and particularly the clauses to which the Trade Practices Commission had drawn attention, and as a result of that examination it altered the terms of the contract after tenders had closed. Can honourable members believe that in any system of tendering a government corporation should, after tenders had closed, alter the terms of the draft contract? The DEPUTY CHAIRMAN(Hon. J. D. M. Dobie) —Order! It being just after 12.45 p.m., in accordance with sessional order 101a, I shall report progress. The Deputy Chairman having reported accordingly- Sitting suspended from 12.45 to 2 p.m. Mr HAWKE(Wills-Prime Minister) —As a matter of courtesy I inform the House that the Leader of the House, Minister for Defence and Acting Minister for Foreign Affairs and Trade, Mr Beazley, will be absent from Question Time today on Government business and portfolio questions which would normally be addressed to Mr Beazley should be addressed to the Minister for Defence Science and Personnel, Mrs Kelly. Mr Connolly —Where is she? Mr HAWKE —She will be coming. Mr McGauran —A gross discourtesy to the House. Mr HAWKE —I think you will just survive it. Questions concerning the Foreign Affairs and Trade portfolio should be addressed to me. The Minister for Primary Industries and Energy, Mr Kerin, is the Acting Leader of the House. Mr Howard having addressed a question to the Acting Treasurer- Madam SPEAKER —Order! The question is out of order. It is not within the Minister's portfolio. Mr MARTIN —My question is directed to the Minister for Transport and Communications. Can the Minister advise the House what actions the Government has taken to ensure that, following the termination of the two airlines agreement in 1990, new entrant airlines will not be prevented from entering the industry through lack of access to airline terminals? Mr WILLIS —As members of the House would know, this Government has moved to bring to an end the two airlines agreement which, as notice was given in October last year, will come to an end in October 1990. That will end almost four decades of very substantial regulation of a major industry in this country and introduce a new era in which there will be the possibility of new entrants to the domestic airline industry in a way which, of course, has not been possible under the highly regulated two airlines agreement. The Government has been concerned not only to ensure that we are providing for the new entrants by way of ending the two-airline agreement but also to make that practically possible by taking substantive action to ensure that there will be access to terminals for new entrants. To do that we have renegotiated leases which had been negotiated under the Fraser Government and which locked up the terminals in most of our major airports until as late as 1993. Those renegotiations have meant that, following the ending of the two airlines agreement in October 1990, each of the two airlines will be required to make available gateway access and passenger baggage handling facilities and associated facilities at each of the airports. In Sydney and Melbourne they will be required to provide two gates each and at smaller airports one gate each. This will mean that there is guaranteed access for new entrants via those facilities. There will also, of course, be capacity for the common user facilities which already exist in the new Brisbane Airport. At Hobart there is space available for common user facilities. So we do not need to have that requirement apply in those two airports. It will also mean that if any new entrant wishes to build its own terminal it can get the approval of the Federal Airports Corporation (FAC) to have that terminal constructed if the proposal is appropriate. The FAC is presently advertising for expressions of interest from various possible new entrants to see what the requirements might be and whether there would be a need for new terminals to be constructed. The situation in short is that we are moving towards a new era in which this most important industry is being deregulated. The practical steps have been taken to ensure that there will be access for new entrants and that after October 1990 a new era of greatly increased competition in the airline industry will come into being. Madam SPEAKER —I inform the House that we have present in the gallery this afternoon a parliamentary delegation from the Parliament of Ireland, led by Mr Sean Treacy, Speaker of the Lower House. On behalf of the House, I extend a very warm welcome. Honourable members-Hear, hear! Mr Howard having addressed a question to the Acting Treasurer- Madam SPEAKER —Order! I again remind the Leader of the Opposition that this matter is not within the portfolio of the Acting Treasurer. Mr HOWARD(Bennelong-Leader of the Opposition)(2.07) —I move: That so much of the Standing and Sessional Orders be suspended as would prevent the Leader of the Opposition moving forthwith the following motion of censure: That this House censures the Acting Treasurer for his failure to explain to the House the reasons for his calling on the Prime Minister to consider resigning. It is perfectly obvious that when an allegation has been made in a newspaper of repute in this country the forms of the House are available to a Minister to put the record straight. I remind the House that there appeared in the Australian newspaper this morning under the by-line of Paul Kelly an article entitled `Why Dawkins and Hawke have split'. That article was based upon a report of a conversation between the Prime Minister (Mr Hawke) and the Acting Treasurer (Mr Dawkins). It was a conversation which, according to the correspondent Mr Kelly, contained in substance a request from the Acting Treasurer to the Prime Minister that the Prime Minister consider resigning. In any other circumstance, with any other government, with any other Minister, and in any other situation, that Minister would have taken advantage of the opportunities that are clearly available in order to deny the accuracy of that report. Did the Acting Treasurer tell the media that that report was wrong? Did the Acting Treasurer come into the Parliament this morning when the Deputy Leader of the Opposition moved for a suspension of Standing Orders? Did he respond to the Deputy Leader's motion? Of course he did not. Like the political coward that he is-- Madam SPEAKER —Order! The honourable member should withdraw that comment. Mr HOWARD —What comment? Madam SPEAKER —The comment you made about the Acting Treasurer. Mr HOWARD —I will withdraw it, and there are a few more to come. Mr Kerin I just rise to indicate that the Government is prepared to debate the censure motion. Question resolved in the affirmative, by an absolute majority. Motion of Censure Mr HOWARD(Bennelong-Leader of the Opposition)(2.08) —I move: That this House censures the Acting Treasurer for his failure to explain to the House the reasons for his calling on the Prime Minister to consider resigning. This is no joking matter. It is not a trivial proposition. It goes to the very heart and stability of this Government. It goes to the veracity of the economic management of this Government at a time when average Australian families are suffering an unprecedented decline in their living standards. It may well be that the Prime Minister (Mr Hawke) and the Ministers of this Government treat the proprieties of the Westminster system with contempt. It may be that this Prime Minister does not believe that this Parliament is entitled to an explanation of the relationship between himself and his Ministers. But I would say to the Prime Minister and his colleagues, as demonstrated by a number of political events in recent times-not least the devastating rejection of the Prime Minister and his policies as evidenced in the Oxley by-election last weekend-that the Australian people are becoming increasingly concerned about the arrogant, out of touch character of this Government. It stands without any question that this Parliament is owed an explanation as to what is going on in the upper levels of this Government. Today the Acting Treasurer, the Minister for Employment, Education and Training (Mr Dawkins), has had three occasions on which to make it plain to this House that the substance of the article that appeared in the Australian newspaper today was incorrect. He could have come into the Parliament this morning and denied it. He could have responded to the motion for the suspension of Standing Orders moved by the Deputy Leader of the Opposition, the honourable member for Kooyong (Mr Peacock), this morning, and, more importantly, Madam Speaker, he need not have hidden behind the ruling that you gave a few moments ago. It would have been perfectly open to the Acting Treasurer, if he really has an answer to the allegation contained in the Australian newspaper article, simply to have said a few moments ago, `No, do not worry about the Standing Orders. I will take that question. I will nail the article for the lie that it is. I will say to Mr Kelly that I did not tell him when I saw him a few days ago that I told Old Silver to stand down'. He could easily have done that. He could easily have said to this Parliament and, through this Parliament, to the Australian people, `No, I have every confidence in the Prime Minister. Like the Treasurer, I want the Prime Minister to go on and lead us to the next election'. He had the opportunity to do that. But no; he passed up that opportunity. On three occasions, the Acting Treasurer has had the opportunity to tell this Parliament that he has every confidence in the Prime Minister and on three occasions he has passed that opportunity over. In the absence of those denials we are left with the inescapable conclusion that the substance of this claim is correct. Of course, as honourable members opposite and on this side of the Parliament do not need to be told, all is not well in the upper reaches of this Government. Everyone knows that Keating wants Hawke's job, that Dawkins wants Keating's job and that Simon Crean wants Keating's job. John Kerin hopes that he will get Keating's job and the drover's dog will settle for any good old trick that happens to be going around. That is the heart of the paralysis of the operation of this Government at present. If it was only something that concerned the personal ambitions of a few people in the Australian Labor Party, if it only related to the soaring vanity of the Prime Minister and the Treasurer and the ambitions of the Acting Treasurer, if it only related to the long term ambitions of the President of the Australian Council of Trade Unions, if it only related to the power aspirations in the trade union movement of the President of the New South Wales Labor Party, Mr MacBean, maybe it would not matter. We on this side of the House and the Australian people would be entitled to say to the Labor Party, `You go away and play your little ambitious games. You go away and play your political musical chairs. You go away and have your conversations on car telephones. You go away and excoriate each other. You go away and do all of that. We really do not care'. But there is a cost. The cost of the paralysis in the decision-making processes of this Government is a direct result of the rivalry and the power ambition that are going on between the Prime Minister, the Treasurer (Mr Keating) and, more recently, the Acting Treasurer. The Acting Treasurer is the self-appointed campaign manager, no less, of the Treasurer in the Treasurer's ambition to succeed the Prime Minister as the leader of the Labor Party. What is the product in policy paralysis of this power rivalry that is going on within the upper reaches of the Government? We saw it very clearly, starkly and eloquently illustrated last week. We do not have one version of the Government's wages policy; we do not have two versions of the Government's wages policy; and we do not even have three versions of the Government's wages policy. Rather we have four versions of the Government's wages policy. First of all, we had the Prime Minister with sweaty palms running around in Ipswich trying to rustle up the traditional Labor vote in this most Labor of all Queensland provincial towns. Unbelievably, a Prime Minister of a Labor government went twice to Ipswich trying to beg and bribe the traditional voters of that Labor Party heartland in Queensland to vote for him. What did the people get? They did not just get a promise of a tax cut. They did not just get a promise of a wage cut. They got a promise for both of them. When Bob went to Ipswich he said, `Do not worry. If you vote for me on Saturday your living standards will be restored. In 12 months' time, you will have the greatest tax cut in history. In 12 months' time, we will be giving you a huge wage increase as well. And, if you vote for good old Bob Hawke in the by-election on Saturday, all of your worries will be over and all of your problems will be solved'. That was message No. 1. If one were a traditional Labor voter in Ipswich or one of those surrounding areas, one would have been entitled to say to oneself, `This is not bad. My living standards may have gone down by $56 a week over the last 5 1/2 years; I may be paying the highest mortgage rate ever; I may be paying the highest tax rate ever; I may find it hard to pay for my children's school excursions; and I may find that I now have to work 49 weeks a year to buy a new car rather than 33 weeks a year 5 1/2 years ago. But, despite all that, it is all going to be fixed if I vote for Bob on Saturday. He is going to fix it. He is going to give me a wage increase and he is also going to give me a tax cut. It is all going to come at once. All the effort of the last 5 1/2 years will be rewarded and I will get all that nice juicy living standard put back into my hip pocket'. Mr Peacock —The new dawn. Mr HOWARD —`That is the new dawn if I vote for Bob in the Ipswich by-election'. Unfortunately, that poor, befuddled, misled, traditional Labor voter in Oxley did not count on the Grim Reaper over there in the Big Apple. There he said, `Oh, no; you cannot have a wage increase and a tax cut. I cannot allow that to happen. I cannot allow Old Silver to dangle that sort of carrot because that might make him a bit popular. They might in fact vote for him'. Madam SPEAKER —Order! Would the honourable member please refer to members of the House by their correct titles. Mr HOWARD —I will refer to Old Silver as the Prime Minister. Madam SPEAKER —Thank you. Mr HOWARD —No doubt the Treasurer said, `I cannot really allow him to get away with that so I will bring him down to earth. I will bell the cat on the Prime Minister while he is in Oxley. I will really tell it as it is'. And he told it as he saw it. He said, `Oh, no; you might get a tax cut if you are a good boy but you will not get a wage increase that is any bigger than I can possibly stop it from being and, desirably, I will not let you have a wage increase at all. What I would really like to have is a zero wage increase'. So that is version No. 2. But, of course, not to be outdone, we have good old Senator Walsh, who thought to himself, `I am thinking of resigning. I am thinking of giving the whole show away. So, I think I will bring both of them down to earth with a great big thud'. Senator Walsh went to Adelaide and expounded the extraordinary proposition-disputed incidentally by senior Treasury officials before Senate Estimates Committee C last night-that there has been no fall in Australian living standards over the last 5 1/2 years. Senator Walsh would have to be the only person in Australia who really believes that. Not only did he say that but he also said, `We may not be able to have a tax cut at all, let alone a wage cut'. To cap the whole matter off, we have Simon Crean coming along and saying that everything that has been said by the three of them is absolute nonsense and it is really a matter that has to be determined by the trade union movement after all. We have the Prime Minister saying, `A tax cut and a wage cut'. We have the Treasurer saying, `A tax cut but no wage cut'. We have the Minister for Finance saying, `Neither a tax cut nor a wage increase because you do not really need it as your living standard has gone up instead of going down over the last 5 1/2 years'. Then, to top it all off, we have Simon Crean coming along and saying, `You are all completely wrong. The trade union movement is led by me. I want ultimately to be the Treasurer in a government led by Mr Keating. I, the trade union movement, will decide whether you get any of it at all'. Is it any wonder that, faced with that total and utter confusion and that total and utter policy paralysis, the traditional Labor voters of Oxley, of Ipswich and the surrounding areas, voted in their thousands against the Hawke Government last Saturday? They voted in their thousands because they are fed up with their falling living standard. They are fed up with a government that congratulates itself on non-existent excellence. They are fed up with being led by a government composed of people who are doing nothing more than jockeying for positions of power and privilege in a government that is fast losing the support and the respect of the Australian people. The reason this is happening, more than anything else, is the appalling mistrust and rivalry that now exists between the senior members of the Hawke Government. It is one thing for people to have differences of policy and attitude on matters of substance and public policy, but it is entirely another matter for the senior Ministers of a government to so hate and mistrust each other as to have allowed things to develop as they have in recent weeks. Everyone knows that, immediately after the Budget, the Prime Minister got a fit of pique. He thought that the Treasurer was getting too much credit for the economic policies of the Government and he decided to put him in his place by making some offhanded remarks, quite calculatedly, about how long he was going to stay around as Prime Minister. Then Senator Richardson ordered him to recant those words on a television program. It all seemed to be papered over, but a few days later the Treasurer was at it again. His minders were tramping around the press gallery giving one or two journalists a transcript of some remarks he made to a gathering of members of the left wing of the Labor Party. The genie was out of the bottle again. As the Treasurer goes off, symbolically, to try to repay some of the huge debt that he has racked up in the 5 1/2 years that he has been Treasurer of this country, everyone in this Parliament knows that the Prime Minister's minders have been working overtime, dumping it on the Treasurer in every nook and cranny of the press gallery. Members of the Prime Minister's staff have been going around briefing the gallery about how if Keating thinks he can get Hawke's job in the next 12 months he has another think coming. All the while, the craven little office manager, the man who did such an outstanding job as Acting Treasurer in this Parliament a couple of weeks ago, the Minister for Employment, Education and Training, the self-appointed campaign manager, was tramping around the press gallery saying, `The Prime Minister ought to go. He has had his turn. He has had his 5 1/2 years. It is about time the Prime Minister stood down. It is about time that he made way for Paul, and it is about time that I became Treasurer of Australia'. Mr Kelly, a journalist with whom I do not always agree, is a journalist who I think has built a reputation for not normally writing on matters of straight fact without having got the substance of the story correct. Honourable members can bet anything they like that Mr Kelly and the Acting Treasurer had a very convivial dinner a few nights ago. Mr McGauran —Monday night, to be exact. Mr HOWARD —Monday night, it is alleged. Honourable members can probably imagine that as the night wore on Kelly said, `Come on, Joe, what did you really say to Old Silver?' As the time wore on and the story came out I imagine he would have told Old-- Mr Peacock —Jellyback. Mr HOWARD —Jellyback. The Acting Treasurer would have told the Prime Minister, `You have had your 5 1/2 years. You told the Treasurer as early as September 1984 that you were going to stand down at a particular time and he has never forgotten it. Why don't you honour the promise you made to the Treasurer? Why don't you stand down?' We can imagine how popular the Acting Treasurer was when he said that. We can imagine who was almost as happy as we were, watching the Acting Treasurer struggle with some basic economic questions a couple of weeks ago. I think the Prime Minister was just as amused as our side was at the total inability of the Acting Treasurer to handle any of those questions. Within the upper reaches of this Government we have a group of people who no longer trust each other, who spend far more time backgrounding against each other, backbiting each other, talking each other down, blackguarding each other to the press gallery through their minders than they do making rational decisions about the future of this country. As the correspondent Paul Kelly remarked this morning: Nobody knows where the Hawke economic team is going from here. But the good old days are over. The super optimists who think everybody can kiss and make up are in a condition of super-delusion. Perhaps a Hawke-Keating deal is still on, but that would leak and create a `lame duck' problem for Hawke at the next election. It seems far too risky. Perhaps Keating will go; maybe there will be another reshuffle. The one certainty is uncertainty. I would add one other certainty to the certainty that was nominated by Mr Kelly. It is that the real sufferers are the average individuals and the average families of Australia. It is those people who, under this group of power hungry rivals, have seen their living standards over the last 5 1/2 years decline by $56 a week. No matter how the Government twists and turns and explains it, no matter how often the Treasurer goes overseas and showers himself with congratulations, no matter how often the Prime Minister parades before the business community of Australia, no matter how much the Government congratulates itself on what it is alleged to have done, the reality is that every time it is tested before the bar of opinion of ordinary Australians it loses and it loses very heavily. There is a very simple reason for that: average Australians and their families are clearly, demonstrably, by any measure, much worse off now than they were 5 1/2 years ago when this Government came to power. It does not really matter whether this Government is led by the present Prime Minister, by the Treasurer, by the Acting Treasurer, by the Minister for Primary Industries and Energy (Mr Kerin), who is sitting at the table, or by anybody else: the Australian people increasingly know that under any Labor government led by anybody in this Parliament their living standards, their hopes, their future and their aspirations will continue to go down the drain. They will go down the drain because the priorities of this Government are now out of touch with the aspirations and the realities of the predicament of Australian families. Mr Scholes —This has all been said before. Mr HOWARD —The honourable member for Corio may well say that this has been said before. I can say that it will be said again and again over the next 18 months because the repetition of the truth about what has happened to the living standards of Australian families is the most relevant political issue on the agenda in Australia today. There is no issue more relevant than what this group of people has done to the living standards of Australians. The failure of the Acting Treasurer to explain himself properly, to express his confidence in the Prime Minister, to deny that he asked the Prime Minister to stand down, serves yet again to underline the bitterness and dissension within this Government between the Prime Minister and his senior Ministers. That, more than anything else, is producing the paralysis in policy, and the real victims of that are Australian families. Madam SPEAKER —Order! The honourable member's time has expired. Is the motion seconded? Mr SINCLAIR(New England-Leader of the National Party of Australia)(2.28) —I second the motion. The Minister for Employment, Education and Training (Mr Dawkins), the Acting Treasurer, has two choices: he can either resign, as he should now, or he should tell us why and in what way he told the Prime Minister (Mr Hawke) that he, the Prime Minister, should resign. When the proceedings of the Parliament began this morning, the Deputy Leader of the Opposition came into this place and referred-- Mr Peacock —And he did a very good job. Mr SINCLAIR —And he did a very good job, as he so modestly says. He referred to an article in this morning's Australian by Paul Kelly, headed `Why Dawkins and Hawke have split'. This is a matter which has been before the Parliament since 10 a.m. The Minister for Employment, Education and Training has not deigned to come in here and make a personal explanation. Mr Holding —Why should he? Mr SINCLAIR —Because he can confirm or deny this, he should do so. If it is not true, there are procedures available to the Minister-and to the honourable member for Melbourne Ports (Mr Holding), and to any member of the Government-to explain to the Parliament and to the people why he thinks the Prime Minister should stay. But, of course, he does not want the Prime Minister to stay. The genesis of this whole matter is one that surrounds the increasing dispute within the front bench and the power brokers of the Labor Party. It is affecting the Labor Party fundamentally. But for us in this Parliament and for the people of Australia, it is even more profound. When we came into the chamber this morning we learnt that the Leader of the House, and Minister for Defence (Mr Beazley), the Minister in this place representing the new Minister for Foreign Affairs and Trade-the Minister for Trade Negotiations (Mr Duffy)-and the Minister for Defence Science and Personnel (Mrs Kelly) were absent. Yesterday the Parliament resumed. We had been away for 12 days. We learnt then that not only was the Treasurer (Mr Keating) on his jaunt around the world and the former Foreign Minister, the Governor-General designate, on his jaunt around the world, but so, too, were the Deputy Prime Minister-the Attorney-General (Mr Lionel Bowen)-and the Minister for Veterans' Affairs (Mr Humphreys). So in the course of two days, yesterday and today-we have been away for 12 days-nearly a quarter of the Ministry, half of the Cabinet, are away from the sittings in this place. The other Ministers might be sitting in the other place, but five senior Ministers are not present. That is why this Government has lost touch. Its members are too busy out there enjoying the perks of office. We hear the Treasurer talking about the baton in his knapsack. Goodness me! He is out there rattling it and beating Old Silver around the head. I am sorry, he is beating the Prime Minister around the head. Madam SPEAKER —Thank you. Mr SINCLAIR —It is really a case of heave-ho Silver, if I have ever seen one. Last Monday night was the genesis of this story. But it is not something new. We heard about `Keating Attacks Hawke's Manchu Court' at the beginning of 1986. We remember the nasty things the Treasurer said about the minders of the Prime Minister backgrounding journalists on Mr Hawke's trip to China, which led to reports that Mr Hawke was displeased with Mr Keating because of his controversial comments on the economy and that he was shouldering him aside. We know that this has been going on for a while. Today is just a continuation of the same old saga, the bitterness and the anger that these two have towards each other. We were told this morning-and how right it was-that Paul Keating's campaign manager at long last fronted up. I am told that he is going to follow me in this debate. We are all looking forward to him telling us whether there is a campaign, whether he is the campaign manager and whether he went in and talked to the Prime Minister as Mr Kelly, I am sure reflecting the comments of last Monday night's Tang Dynasty discussion, suggested. Did he, when he was telling the Prime Minister that he ought to go, set down the schedule of who was going to take over and when he was going to take over? I think the Australian people have an interest in this matter. Remember how sparse the Government front benches were when we came in to Question Time today? The Ministers are not bothered about coming into the chamber. They can be off attending an air show-important though it might be. What is wrong with the end of the week? Why cannot Ministers go on Friday? Mr Kerin —He is opening it. Mr SINCLAIR —It would not be the first show that was not opened on the opening day. As far as the Deputy Prime Minister is concerned, surely, when the Treasurer is away, is it that important that the two most senior Ministers have to be away? After all, it is the Keating-Hawke Government. We have the Deputy Prime Minister and the Treasurer somewhere overseas. This shows yet again that the concern about living standards, about the directions of economic policy, is treated as a farce. That is where this all began. In regard to the directions of economic policy, prior to the Oxley election we had the absolute farce of the man who is Acting Treasurer coming into the chamber at the beginning of the week and saying that interest rates were trending down. The rest of the week he bungled and fumbled his way along, question by question-he did not know, he thought he might know, he could not answer, he deferred his answer, he suggested something else. In the last sitting week we learnt that the Acting Treasurer really did not know anything about the management of the economy. Yet this is the man who apparently is the stage manager for the Treasurer and his aspirations to exercise that position of influence-Prime Minister of this country. Mr N.A. Brown —Short John Silver. Mr SINCLAIR —Short John Silver is right. Why is the Acting Treasurer not prepared to tell us what is happening and why he went along to tell the Prime Minister to resign? I will tell honourable members why it happened. The Prime Minister is a lame duck Prime Minister. The Treasurer has decided that it is now or never. There has been a succession of by-elections. There has been a magnificent New South Wales election. The Labor Party has, properly and justifiably, lost the confidence of the Australian people. The Treasurer has decided that it is time for him to try to take over from the Prime Minister, for if he does not do so now, then, come the next election, there will no longer be any chance for him to do so. Including the resignation of the former Foreign Minister, the Governor-General designate, 10 senior Ministers of the original Hawke Ministry have resigned-some from this chamber and some from the other place. In the early stages those Ministers tried to set what they thought was a responsible, alternative course for Australia. Now they have gone. We had men like Mick Young. We were all quite confident that in his bluff Irish way we would get a laugh or two. We knew that he should have gone years before. After all, it was about him that Mr Justice Hope made remarks on conduct that no one could condone. After each one of these Ministers left, the hopes of all those on the back benches-- Mr Hollis —Punchy. Mr SINCLAIR —Including even the hopes of my friend up the back there, who has a bit of verbal diarrhoea-were that one day they might get on the front bench. Mr N.A. Brown —Oh, no! Mr SINCLAIR —Piteous. The Government has lost its sense of direction. It certainly no longer has the capacity to act in unison. All those individuals are running off in their several directions. Above all, the people at the core are beginning to sense that they have to do something about it. We can see the cauldron bubbling. We saw how the Prime Minister is prepared to do anything to placate the man from whom he stole the leadership of the Labor Party. Now he is reluctant to let go. The Acting Treasurer went along to the Prime Minister and said, `Look, Bob, we have to do something about this. We have just about had it. We think you have lost your sense of direction. You are up there; you have forgotten how ordinary people live and the costs that affect them'. Mr Holding —You have never milked a cow in you life. Mr SINCLAIR —If the Minister had heard the honourable member for Riverina-Darling (Mr Hicks) yesterday, he would know that he addressed the issues that the Minister has forgotten about. Mr Holding —You have milked a till, but not a cow. Madam SPEAKER —The Minister will cease interjecting. Mr SINCLAIR —He is worried about living standards, about people who normally go into shopping centres-not like the Minister; he probably sends his driver-and what they have to pay for ordinary foodstuffs. Madam SPEAKER —Order! The Chair has asked the Minister to stop interjecting and expects him to assist the Chair in doing so. Mr SINCLAIR —If the Minister had been here yesterday, he would have heard the honourable member for Riverina-Darling talk about the issues that affect the average Australian who is concerned about living standards. Sadly, honourable members opposite are above it all. They go and talk to their powerful friends. They say to the leaders of the union movement, `Do not worry about all that. We do not have to worry about ordinary Australians. We have this power game all sewn up'. We know, and the electors of Oxley, Adelaide, Port Adelaide and New South Wales know, that things are not quite like that. When the Acting Treasurer went along to see the Prime Minister he was reflecting the genuine concern that a few honourable members opposite have about the directions of the Government. If honourable members think, `Oh, but that is all up in the high-minded game', let us turn to two other examples. What did Senator Walsh say? He was reflecting the view of many Australians when he said that the Government has to address concerns about productivity. He said that if last month's current account deficit was as bad as it was for the previous two months of this financial year, we will have to do something about cutting public sector Federal spending. Mr Ruddock —He is the only one in step. Mr SINCLAIR —He is. Senator Walsh has drawn all the flourish from the crowd opposite. Senator Walsh has said to the Prime Minister and the Treasurer, `Never mind all this eulogising to the electors of Oxley, never mind preaching to the International Monetary Fund or telling the Americans and the Europeans how to run their economies. What about coming back home and running ours?' Where has the Treasurer been? He was away all the last week we sat. He was away the 12 days when the House was in recess. He has been away all of this week and he will be away half of the next sitting week. Although he has paid off one small element of debt, at home the debts rise at twice the rate he is repaying them. The economy is in the control and management of the man who has told the Prime Minister he must go. A Government cannot operate with all of its Ministers away. Members of the House know that the present Acting Treasurer is responsible for running the economy and he does not really know whether interest rates are rising or falling. Members of the Government cannot even answer questions about these things during the proceedings of the House. Today not only were all the Ministers absent but a new boy was Leader of the House. I wish him well. We heard this morning that he wants to be Treasurer in the new show. He will not do much of a job as Leader of the House. He did not know what to do or how to handle things. Members of the Government were at odds and evens. This morning the Deputy Leader of the Opposition properly asked the Acting Treasurer to tell us why he and the Prime Minister had split, to tell us why he went in and told the Prime Minister that the Prime Minister should resign. Members of the Government do not even know how to handle the House, how to handle the Government. They certainly do not know how to handle the economy. It is just not good enough. It is about time the Australian Labor Party addressed the responsibilities it has as a government in this place. Government members interjecting- Mr SINCLAIR —The honourable member for Macarthur (Mr Martin) will never make it. He has had it. I know he is out there behind Long John Silver. What will he say to his friends at the table? Is he one of the guys in favour of telling the Prime Minister to go? Perhaps he ought to get up and tell us. There are a few others up there. I know all the boys on the Left want him to go. We have heard all about it. It says in this newspaper article by Paul Kelly that the Minister was telling the Prime Minister what he has already said face to face to others. He felt obliged to tell Hawke to his face what he was saying to others. Full marks for his honesty. Why can he not be honest with us? That is what the censure motion is all about. The Acting Treasurer has a responsibility to this House to tell honourable members why he told the Prime Minister that he should resign. The Acting Treasurer has a responsibility to tell us just how and in what way the Prime Minister reacted to his request. The Acting Treasurer has a responsibility to tell us that he will cease acting on behalf of the Treasurer, that they are all a happy band of brothers again. If he tells us that, we will know what a farce it is. The reality is that the Prime Minister is a lame duck Prime Minister. What the Acting Treasurer said is true. The Prime Minister ought to come into this House and tell honourable members when he is going because that is what this is all about. The Acting Treasurer knows the Prime Minister has to go and the public know the Prime Minister has to go. All we want to know is when he will go. The Acting Treasurer deserves to be censured and all honourable members will be interested in whether he has any explanation. Mr DAWKINS(Fremantle-Minister for Employment, Education and Training and Acting Treasurer)(3.44) —Obviously the Government rejects the motion. The reason is that there is simply no case to answer. The Opposition, in what must have been one of the most lacklustre performances in a debate on a censure motion, simply failed to make a case against me, to make a case against the Government, to make a case against anybody. We are lectured constantly by the Opposition about the forms of the House. We have a constant string of points of order telling us how we should behave and conduct ourselves in this House and yet members of the Opposition use probably one of the most grave devices within the House, that of moving a censure motion against a Minister, with such flippancy and triviality as to expose their real view about this particular issue and their own contempt for the Parliament itself. Matters for censure should be grave and should be based on some evidence and some fact and not on some vague assertion. What is the evidence that has been presented to us today? It is simply an article which appeared in today's Australian which quotes nobody, which has no authority in terms of the normal standards of evidence that one would expect; that is, people actually being quoted. This is an inadequate basis for launching a censure motion against anybody. As the Deputy Leader of the Opposition (Mr Peacock) told us yesterday, one should be careful not to believe everything one reads in the paper. That is what he said in relation to his little skirmish with the aerobics class a couple of days ago. Opposition members interjecting- Madam SPEAKER —Order! Members on my left will cease interjecting. Mr Downer —We want the truth. Madam SPEAKER —The honourable member for Mayo is included in that warning. Mr DAWKINS —I agree with him. One should not believe everything one reads in the newspaper. I wish to speak a little about the issue which apparently is at the substance of this debate-the leadership of this Government. Firstly, the Prime Minister (Mr Hawke) has led a remarkably successful Government. Our success has been so bewildering to Opposition members that they have not been able to hold a candle to it. Opposition members interjecting- Madam SPEAKER —Order! The two previous speakers were heard in relative silence. I expect the same courtesy to be extended to the Minister. I expect the honourable member for Deakin to cease interjecting. His interjections are becoming almost vexatious. Mr DAWKINS —The Prime Minister has led a remarkably successful Government. It does not matter what one wants to measure-whether it is economic performance and the way this Government has turned around the circumstances of this country from the chaos we inherited from those opposite; the remarkably successful foreign policy the Government has been pursuing; the remarkably successful health policy we have introduced into this country; or the remarkably successful education policy for which I now have responsibility. The Opposition is bewildered by the pace of change and by the success of the achievements of this Government led by the Prime Minister. The Prime Minister, in three successive general elections, has created history by getting a Labor government elected and then re-elected twice. As I have said before, both privately and publicly, I support the Prime Minister's remaining Leader of this Party for however long he chooses to remain. I say in passing to the Leader of the Opposition (Mr Howard), who moved this censure motion, that I wish he would remain Leader of the Opposition forever. If anyone should be well aware of the electoral success of this Prime Minister, it is both the Leader of the Opposition and his Deputy. The Prime Minister has beaten them both. This censure motion is a shameless attempt to deflect attention from where the real leadership problems exist in this Parliament, and that is on the other side of the House. It is a matter of utter dismay to hear the Leader of the Opposition talking in these terms about me. After all, he is the master of treachery when it comes to questions of leadership. It was he who got the Deputy Leader of the Opposition in his sights and week after week, month after month, went around in a most treacherous fashion until finally he was able to secure his replacement as Leader of the Opposition. Lots of people on this side of the House were not too worried about that. We cheered and applauded when the current Leader of the Opposition became Leader of the Opposition, because we have known for a long time-- Mr Tuckey —I raise a point of order, Mr Deputy Speaker. As a preliminary, I read to you the censure motion: That this House censures the Acting Treasurer for his failure to explain to the House the reasons for his calling on the Prime Minister to consider resigning. Mr DEPUTY SPEAKER(Mr Leo McLeay) —Order! There is no point of order. The honourable member for O'Connor will resume his seat. Mr Tuckey —There is a point of order, Mr Deputy Speaker. You have not got my point of order yet. Do me the privilege of listening. Mr DEPUTY SPEAKER —Hurry up. Mr Tuckey —The point of order is one of relevance. The Minister is talking to this Parliament like he talks to his tax accountants. Mr DEPUTY SPEAKER —Order! There is no point of order. Mr Tuckey —He keeps telling them lies. Mr DEPUTY SPEAKER —Order! I warn the honourable member for O'Connor. Mr DAWKINS —I require that to be withdrawn. Mr Kerin —On a point of order, Mr Deputy Speaker, I ask that you require the honourable member for O'Connor to withdraw that accusation of lying. Mr DEPUTY SPEAKER —The honourable member for O'Connor will withdraw the accusation that the Minister was lying. Mr Tuckey —I will withdraw the word `lie'. Mr DEPUTY SPEAKER —The honourable member for O'Connor will resume his seat. Mr Tuckey —Not the reference to his tax accountant. Mr DEPUTY SPEAKER —Order! The honourable member for O'Connor will resume his seat. Mr DAWKINS —Seeing that the honourable member for O'Connor has bought into this in the kind of clumsy way he tries to buy into everything, I would like to refer, in the context of the shambles of the leadership on the other side, to a very well read newspaper in Western Australia known as the Avon Valley Advocate. We had the honourable member for O'Connor addressing a meeting of the Liberal Party in Northam. In this context I will read a couple of short passages to give the honourable members some-- Opposition members interjecting- Mr DEPUTY SPEAKER —Order! A motion of censure has been moved against the Minister by the Opposition. The Opposition should listen to the Minister's response. Opposition members were heard in silence and the Minister should be heard in silence. If there are any further interjections of the type made just now by the honourable member for North Sydney, I will name those involved. Mr DAWKINS —At this meeting of the Liberal Party in Northam, the honourable member for O'Connor was apparently outlining his views on health policies, views which are now irrelevant because he has been sacked as Opposition spokesman on health and now has the unenviable task of shadowing me. During this meeting the issue of Federal Party leadership was obviously still a contentious matter. We were told in this newspaper: When asked to comment on recent media speculation about Mr Howard's future as Opposition leader Mr Tuckey asked if the press was going to report what he had to say. After being informed that his comments would be reported Mr Tuckey declined to speak on the issue. If the honourable member for O'Connor was prepared to give a ringing endorsement to this embattled Leader of the Opposition, one would have thought he would appreciate the fact that the press was there and was going to report it. The only possible conclusion one can come to is that what he was not prepared to do publicly but was prepared to do privately was to bag and undermine the Leader of the Opposition. So we should not have the honourable member for O'Connor buying into this debate in this way. As I said, we have had here talking about leadership the great failed duumvirate of Sinclair and Howard, the Leader of the National Party and the Leader of the Opposition. We do not have to rely on unsourced newspaper articles to find out what the people think, what everyone in the country thinks about this particular leadership band. We have only to refer to a report in the Australian Financial Review, based on the Quantum survey, for an assessment. That article says that the perception of Mr Howard's performance as Liberal Leader is almost entirely negative. He is Mr 25 per cent, yet he still parades himself as an alternative Prime Minister. We do not have to rely on surveys. We do not know what the basis of that Quantum survey was. We have actual, real, live authentic people on whom to rely. We have no less than the Western Australian Leader of the National Party: Mr Cowan said yesterday he had not changed his stance that Mr Sinclair and Mr Howard had to go . . . `With Sinclair and Howard at the helm the conservatives can't win'. Here we have authentic evidence from a leader of one of their parties who is perfectly happy to put on the record what his view is of this leadership team. On 9 October, at the National Party conference in Queensland, one of the delegates said that Mr Sinclair was not a winner and should step down if the Nationals were not in government after the next election. He might as well go now because we know the answer to that particular question. He went on to say that Mr Sinclair should sack himself for the sake of the Party. These are the real issues of leadership as far as current politics are concerned; but it would be a mistake to think that leadership was the only question on the Opposition side. The real problem with the Opposition is the fact that this Government has been so spectacularly successful across the whole range of policy initiatives. That is the real issue: it cannot hold a candle to us. It has no policies. For evidence of that we need only refer to a former staff member of the current Leader of the Opposition, Gerard Henderson, who simply says that the Opposition's problem goes much deeper than leadership. It is a problem on the front bench, it is a problem on the back bench, it is a problem of no policies, no direction, no ideas and, as was easily exposed today, no enthusiasm whatsoever for the task in front of it. I have said that this Government has been spectacularly successful, but the House does not have to rely on my assessment alone. The new boy on the Opposition front bench, the honourable member for Wentworth (Dr Hewson), in his loquacious articles in the Business Review Weekly often had some very interesting comments to make about this Government and politics in general. Mr Moore interjecting- Mr DEPUTY SPEAKER —I warn the honourable member for Ryan. Mr DAWKINS —On 15 May 1987 he said: The Hawke Government is very professional and is probably the best front bench since World War II. That is the case. That is the judgment of the honourable member for Wentworth. I would not have thought he was a man who lightly changed his mind. After all, he keeps telling us what a fantastic economist he is, and I suppose he would also claim to be a man of some principle. We have the assessment from the front bench by the newest member-appointed by the Leader of the Opposition-that this is the best government since World War II. It is the best government since World War II at least, and will continue to be so. Mr Fife —I move an extension of time to give the Minister an opportunity to answer the charge. He has not done so. Mr DEPUTY SPEAKER —Order! The honourable member for Hume does not have the call. He will resume his seat. Motion (by Mr Kerin) put: That the question be now put. A division having been called and the bells being rung- Mr Tim Fischer —Mr Deputy Speaker, I raise a point of order to seek clarification. Because of the importance of this censure motion I draw your attention to the fact that the broadcasting sign has been on since the censure motion was moved. It is a Senate broadcast day. The Senate was being broadcast during Question Time. Presumably the Senate will revert to Estimates committees at 3 o'clock. I seek your confirmation as to whether this House in fact has been broadcast during this very important censure motion against the Minister. Mr DEPUTY SPEAKER —The honourable member for Farrer might be more aware of whether that is a fact than I am. I will inquire and let him know. It might have occurred to honourable members on my left that I have been sitting in the chair while they have been walking in and out of the chamber. The House divided. (Madam Speaker-Hon. Joan Child) Ayes . . . . . . . . . . . 67 Noes . . . . . . . . . . . 51 —— Majority . . . . . . . . . 16 —— Baldwin, P. J. Kelly, R. J.Beddall, D. P. Kent, L.Bilney, G. N. Kerin, J. C.Blanchard, C. A. Kerr, D. J. C.Brown, Robert Lamb, A. H. (Teller)Campbell, G. Langmore, J. V.Charles, D. E. Lavarch, M. H.Charlesworth, R. I. Lee, M. J.Cleeland, P. R. Lindsay, E. J.Cohen, B. McHugh, J.Crawford, M. C. McLeay, LeoCunningham, B. T. (Teller) Martin, S. P.Dawkins, J. S. Mildren, J. B.Dubois, S. C. Milton, P.Duncan, P. Morris, AllanEdwards, Ronald Morris, PeterFatin, W. F. Price, L. R. S.Fitzgibbon, E. J. Punch, G. F.Free, R. V. Saunderson, J.Gayler, J. Sawford, R. W.Gear, G. Scholes, G. G. D.Gorman, R. N. J. Sciacca, C.Grace, E. L. Scott, JohnGriffiths, A. G. Simmons, D. W.Hand, G. L. Snow, J. H.Harvey, E. R. Snowdon, W. E.Hawke, R. J. L. Staples, P. R.Holding, A. C. Theophanous, A. C.Hollis, C. Tickner, R. E.Howe, B. L. Uren, T.Jakobsen, C. A. West, S. J.Jenkins, H. A. Willis, R.Johns, G. T. Wright, K. W.Jones, Barry Adermann, A. E. Lloyd, B.Aldred, K. J. McGauran, P. J.Andrew, J. N. (Teller) Macphee, I. M.Beale, J. H. Miles, C. G.Braithwaite, R. A. Moore, J. C.Brown, N. A. Nehl, G. B.Cadman, A. G. 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, IanCowan, D. B. Rocher, A. C.Dobie, J. D. M. Ruddock, P. M.Downer, A. J. G. Shack, P. D.Edwards, Harry Sharp, J. R.Fife, W. C. Sinclair, I. McC.Fischer, Tim Smith, W. L.Fisher, Peter Spender, J. M.Goodluck, B. J. Sullivan, K. J.Hawker, D. P. M. Taylor, W. L.Hewson, J. R. Tuckey, C. W.Hicks, N. J. (Teller) Webster, A. P.Howard, J. W. Wilson, I. B. C.Hunt, R. J. D. Woods, R. L.Jull, D. F. Question so resolved in the affirmative. Original question put: That the motion (Mr Howard's) be agreed to. The House divided. (Madam Speaker-Hon. Joan Child) Ayes . . . . . . . . . . . 51 Noes . . . . . . . . . . . 67 —— Majority . . . . . . . . . 16 —— Adermann, A. E. Lloyd, B.Aldred, K. J. McGauran, P. J.Andrew, J. N. (Teller) Macphee, I. M.Beale, J. H. Miles, C. G.Braithwaite, R. A. Moore, J. C.Brown, N. A. Nehl, G. B.Cadman, A. G. 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, IanCowan, D. B. Rocher, A. C.Dobie, J. D. M. Ruddock, P. M.Downer, A. J. G. Shack, P. D.Edwards, Harry Sharp, J. R.Fife, W. C. Sinclair, I. McC.Fischer, Tim Smith, W. L.Fisher, Peter Spender, J. M.Goodluck, B. J. Sullivan, K. J.Hawker, D. P. M. Taylor, W. L.Hewson, J. R. Tuckey, C. W.Hicks, N. J. (Teller) Webster, A. P.Howard, J. W. Wilson, I. B. C.Hunt, R. J. D. Woods, R. L.Jull, D. F. Baldwin, P. J. Kelly, R. J.Beddall, D. P. Kent, L.Bilney, G. N. Kerin, J. C.Blanchard, C. A. Kerr, D. J. C.Brown, Robert Lamb, A. H. (Teller)Campbell, G. Langmore, J. V.Charles, D. E. Lavarch, M. H.Charlesworth, R. I. Lee, M. J.Cleeland, P. R. Lindsay, E. J.Cohen, B. McHugh, J.Crawford, M. C. McLeay, LeoCunningham, B. T. (Teller) Martin, S. P.Dawkins, J. S. Mildren, J. B.Dubois, S. C. Milton, P.Duncan, P. Morris, AllanEdwards, Ronald Morris, PeterFatin, W. F. Price, L. R. S.Fitzgibbon, E. J. Punch, G. F.Free, R. V. Saunderson, J.Gayler, J. Sawford, R. W.Gear, G. Scholes, G. G. D.Gorman, R. N. J. Sciacca, C.Grace, E. L. Scott, JohnGriffiths, A. G. Simmons, D. W.Hand, G. L. Snow, J. H.Harvey, E. R. Snowdon, W. E.Hawke, R. J. L. Staples, P. R.Holding, A. C. Theophanous, A. C.Hollis, C. Tickner, R. E.Howe, B. L. Uren, T.Jakobsen, C. A. West, S. J.Jenkins, H. A. Willis, R.Johns, G. T. Wright, K. W.Jones, Barry Question so resolved in the negative. Mr Hawke —I ask that further questions be placed on the Notice Paper. Mr FIFE(Hume) —Madam Speaker, may I ask you a question? Madam SPEAKER —Certainly. Mr FIFE —In view of the absence of a large number of Ministers during Question Time today, could you take up with the Prime Minister (Mr Hawke) whether he could provide a list of Ministers who will be available to answer questions tomorrow? Could such a list be circulated before Question Time? Madam SPEAKER —I will consider the question asked of me by the honourable member for Hume. Mr Kerin —Madam Speaker, I seek your indulgence to comment on the matter raised by the honourable member for Hume (Mr Fife). There are 11 members of the Government Party missing. They are all paired with members opposite. There are five Ministers missing, one of whom is Dr Blewett. Mr Fife —Madam Speaker, I apologise. I did not hear your answer to my question. Would you take it up with the Prime Minister? Madam SPEAKER —I said I will deliberate on your question and give you an answer. Madam SPEAKER —Pursuant to statutes, I present the annual reports and financial statements of the Commonwealth Bank of Australia, Commonwealth Savings Bank of Australia and the Commonwealth Development Bank of Australia, together with the Auditor-General's report thereon, for the year ended 30 June 1988. Mr KERIN(Werriwa-Acting 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 Meat and Live-Stock Corporation-Annual Report 1987-88-including the Auditor-General's Report-section 49 of the Australian Meat and Live-stock Corporation Act 1977. Resolutions of the Australian Agricultural Council-130th Meeting-Cairns, 14 July 1988. Resolutions of the Australian Soil Conservation Council-3rd Meeting-Cairns, 15 July 1988. Australian Telecommunications Commission-Annual Report 1987-88-including the Auditor-General's Report-section 99 of the Telecommunications Act 1975. Army and Air Force Canteen Service Board of Management-Report for the period 27 January 1987 to 1 February 1988-including the Auditor-General's Report-regulation 23E of the Army and Air Force Canteen Service Regulations 1981. Central and Local Trades Committees-Annual Report 1986-87. Australian Wool Corporation-Annual Report 1987-88-including the Auditor-General's Report-section 123 of the Wool Marketing Act 1987. Australian Archives-Annual Report 1987-88-section 68 of the Archives Act 1983. Advisory Council on Australian Archives-Annual Report 1987-88-section 68 of the Archives Act 1983. Mr N.A. Brown(Menzies) —I wish to make a personal explanation. Mr DEPUTY SPEAKER(Mr Leo McLeay) —Does the honourable member claim to have been misrepresented? Mr N.A. Brown —Yes, Mr Deputy Speaker. Mr DEPUTY SPEAKER —Please proceed. Mr N.A. Brown —The Australian newspaper, although obviously very accurate in most things, today blotted its copybook in one respect only of which I am aware. That is the report that it carried on page 1 of today's issue relating to the Government's fooling around with the process of having the Privacy Bill drawn. The proposition is contained in this article and I quote from it because this contains the misrepresentation: The chairman of the ALP's legal and administrative affairs committee, Mr Keith Wright, said last night a draft of the legislation had been sent to the shadow attorney-general, Mr Neil Brown. That is completely false. The implication clearly is that the Opposition has received this Bill whereas in fact it has not-despite the fact that every hour or so I get a telephone call from a journalist telling me that someone in the Government has said, `They have finished the Bill and it is being sent down to Neil Brown'. It is baseless and false, and the Government has as much order and discipline in preparing this Bill as a swarm of bogong moths. Mr DEPUTY SPEAKER —Order! The honourable member is now debating the matter. Mr DEPUTY SPEAKER(Mr Leo McLeay) —Madam Speaker has received a letter from the honourable member for Mayo (Mr Downer) proposing that a definite matter of public importance be submitted to the House for discussion, namely: The crippling effect of the Government's economic policies on Australians trying to buy their own homes. 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- Motion (by Mr Kerin) put: That the business of the day be called on. The House divided. (Mr Deputy Speaker-Mr Leo McLeay) Ayes . . . . . . . . . . . 64 Noes . . . . . . . . . . . 49 —— Majority . . . . . . . . . 15 —— Baldwin, P. J. Kelly, R. J.Beddall, D. P. Kent, L.Bilney, G. N. Kerin, J. C.Blanchard, C. A. Kerr, D. J. C.Brown, Robert Lamb, A. H. (Teller)Campbell, G. Langmore, J. V.Charles, D. E. Lavarch, M. H.Charlesworth, R. I. Lee, M. J.Cleeland, P. R. Lindsay, E. J.Crawford, M. C. McHugh, J.Cunningham, B. T. (Teller) Martin, S. P.Dawkins, J. S. Mildren, J. B.Dubois, S. C. Milton, P.Duncan, P. Morris, AllanEdwards, Ronald Morris, PeterFatin, W. F. Price, L. R. S.Fitzgibbon, E. J. Punch, G. F.Free, R. V. Saunderson, J.Gayler, J. Sawford, R. W.Gear, G. Scholes, G. G. D.Gorman, R. N. J. Sciacca, C.Grace, E. L. Scott, JohnGriffiths, A. G. Simmons, D. W.Hand, G. L. Snow, J. H.Harvey, E. R. Snowdon, W. E.Holding, A. C. Staples, P. R.Hollis, C. Theophanous, A. C.Howe, B. L. Tickner, R. E.Jakobsen, C. A. Uren, T.Jenkins, H. A. West, S. J.Johns, G. T. Willis, R.Jones, Barry Wright, K. W. Adermann, A. E. Lloyd, B.Aldred, K. J. McGauran, P. J.Andrew, J. N. (Teller) Macphee, I. M.Beale, J. H. Miles, C. G.Braithwaite, R. A. Moore, J. C.Brown, N. A. Nehl, G. B.Cadman, A. G. Porter, J. R.Cameron, Ewen Pratt, M. P.Cameron, Ian Prosser, G. D.Carlton, J. J. Reith, P. K.Cobb, M. R. Robinson, IanConnolly, D. M. Rocher, A. C.Cowan, D. B. Ruddock, P. M.Dobie, J. D. M. Shack, P. D.Downer, A. J. G. Sharp, J. R.Edwards, Harry Sinclair, I. McC.Fife, W. C. Smith, W. L.Fischer, Tim Spender, J. M.Fisher, Peter Sullivan, K. J.Goodluck, B. J. Taylor, W. L.Hawker, D. P. M. Tuckey, C. W.Hewson, J. R. Webster, A. P.Hicks, N. J. (Teller) Wilson, I. B. C.Hunt, R. J. D. Woods, R. L.Jull, D. F. Humphreys, B. C. Hall, SteeleBrumby, J. M. Burr, M. A.Mountford, J. G. Millar, P. C.O'Neil, L. R. T. McArthur, F. S.Darling, E. E. Cameron, DonaldKeating, P. J. Blunt, C. W.Duffy, M. J. White, P. N. D.Klugman, R. E. Wooldridge, M. R. L.Bowen, Lionel Katter, R. C.O'Keefe, N. P. Halverson, R. G.Blewett, N. MacKellar, M. J. R.Hawke, R. J. L. Howard, J. W. Question so resolved in the affirmative. Bill presented by Mr Willis, and read a first time. Mr WILLIS(Gellibrand-Minister for Transport and Communications)(3.26) —I move: That the Bill be now read a second time. The OTC (Conversion into Public Company) Bill 1988 is part of the Government's reform package for the Overseas Telecommunications Commission (OTC) as announced by the then Minister for Transport and Communications, Senator Gareth Evans, on 25 May this year. The reforms to government business enterprises are central to the Government's micro-economic reform agenda to restructure the public sector. In the present difficult and fiercely competitive international trading environment public sector efficiency is especially important. Many public business enterprises-particularly those in the Transport and Communications portfolio-not only final produce goods and services for the consumer, but also provide intermediate inputs for the rest of the economy, and thus influence the nation's overall cost structures. OTC is established under the Overseas Telecommunications Act. This Act was passed by Parliament in 1946, following the acquisition by the Federal Government of the radiocommunications assets of two companies, Cable and Wireless, and Amalgamated Wireless (Australasia), which had hitherto operated cable and beam wireless communications systems between Australia and the rest of the world. Since then OTC has operated as a separate body. The 25 May ministerial statement affirmed the Government's decision to retain each of the telecommunications carriers-Telecom, OTC and Aussat-as separate entities. Given the increasing competitiveness of international telecommunications, the importance of telecommunications to our economy, the growth in this sector and the fact that OTC serves no explicit social obligations, the Government has decided that OTC will be renamed the Overseas Telecommunications Corporation and it will be incorporated under companies legislation as OTC Ltd. OTC is an organisation which already operates in a commercial manner. It is subject to all Commonwealth taxes and charges and pays substantial dividends to the Commonwealth. It has an effective monopoly over the central core of its operations, but it faces competition in other areas such as delivery of value added services and consultancy services. OTC has a sound financial structure with a debt to equity ratio of around 65 : 35. On conversion to a company, there will be no need to alter OTC's financial structure nor will the ownership change-that is, OTC will continue to be owned by the Commonwealth. In future the Government will be less involved in scrutinising the day to day activities of OTC. Instead, it will focus on planning, through corporate plans and financial targets, and accountability for results with strategic aspects monitored on an ongoing basis. The emphasis in future will be on the bottom line, on how successfully the goals and targets are met. A myriad of unnecessary government controls over day to day management decision-making will be removed. The Government aims, through this approach, to establish a clearer distinction between the ownership of the enterprise, the board and management. The OTC (Conversion into Public Company) Bill 1988 amends the Overseas Telecommunications Act and deems OTC to be a public company. Like the ANL (Conversion into Public Company) Bill 1988 introduced by my colleague the former Minister for Transport and Communications Support and present Minister for Industrial Relations (Mr Peter Morris), this approach is consistent with that adopted for Australian Airlines' conversion to company status. As the same legal entity is transferred to company status there is no need to rewrite existing contracts and the like. The date for conversion is set by proclamation-at this stage intended to be 1 January 1989. OTC Ltd will be expected to operate like other companies under the companies code. This means most of the provisions of the Overseas Telecommunications Act will not be needed and can be repealed. Included among these are provisions which deal with staffing matters. The Bill includes provisions to ensure continuity of employment and the maintenance of existing accrued entitlements for each employee on conversion of OTC to a company. In future OTC will be responsible for terms and conditions of employment. OTC is currently consulting staff associations on how existing terms and conditions will be dealt with in awards or agreements. The Government expects OTC to make arrangements to transfer terms and conditions and to ensure that no current staff member loses any entitlement or classification on transfer to OTC Ltd. The Government will not proclaim the Bill until it is satisfied that the interests of OTC employees are protected and terms and conditions are satisfactorily transferred. The Bill minimises day to day government controls in line with the enhanced responsibilities and accountability of the board. There will be appropriate mechanisms to allow the Minister to exercise strategic oversight, through the corporate plan and financial targets. OTC will be free to engage, on its own authority, in such standard business practices as entering into contracts, partnerships, joint ventures, and normal business investment arrangements. In some cases, such as establishing subsidiary companies, the board will be required to notify the Minister in writing before business activities are expanded. Subject to overall Loan Council scrutiny, OTC will not be required to obtain ministerial approval to the terms and conditions of individual borrowings. Finally, the Bill does not involve any additional expenditure by the Commonwealth. However, improvements in the performance of OTC that result from the implementation of the reform package, of which this Bill is a part, will benefit the shareholders and all users of OTC's services. I commend this Bill to the House. I present the explanatory memorandum to this Bill. Debate (on motion by Mr Cadman) adjourned. Bill presented by Mr Kerin, and read a first time. Mr KERIN(Werriwa-Minister for Primary Industries and Energy)(3.32) —I move: That the Bill be now read a second time. Since the deregulation of the industry at the beginning of 1988, oil producers have proven to be quick to develop new markets and innovative marketing techniques. In this way they have been able to maximise the value of their output, both to themselves and the nation. However, as a result of these developments certain types of crude oil transactions have occurred which are not strictly covered by the Petroleum Excise (Prices) Act 1987, since these transactions were not envisaged when the Act was passed. The principal purpose of this Bill, which is largely of a technical nature, is to amend the 1987 Act to provide the Minister with additional powers to fix, for the purpose of excise determination, prices for certain types of crude oil transactions. Such transactions include sales where a quantity of crude oil is disposed of either by exchange, having the oil converted to products which are then sold or by any means other than direct sale-for example, by barter. Commonwealth excise on crude oil production is estimated at $1.4 billion in 1988-89. This Bill is essential to ensure that excise on the transactions described is assessed on a fair and accurate basis. In addition, the Bill will allow crude oil producers the greatest possible flexibility in the use of marketing techniques. I present the explanatory memorandum to this Bill, and commend the Bill to honourable members. Debate (on motion by Mr Cadman) adjourned. Bill presented by Mr Kerin, and read a first time. Mr KERIN(Werriwa-Minister for Primary Industries and Energy)(3.35) —I move: That the Bill be now read a second time. This Bill is an omnibus Bill for legislation administered within the primary industries and energy portfolio. Its introduction will facilitate the passage of amendments to existing legislation. Sugar Agreement Act 1985 The Bill provides for the repeal of the Sugar Agreement Act 1985 with effect from 1 July 1989. The Act prohibits the importation of sugar and sugar products as described in the 1984 Commonwealth-Queensland Sugar Agreement. The Agreement is set out in the schedule to the Act. The Agreement expires on 30 June 1989. This expiry notwithstanding, the Act provides that the import prohibition extends beyond 30 June 1989. As part of the Government's economic statement of 25 May 1988, it was announced that the prohibition on the importation of sugar and sugar products was to be replaced by ad valorem tariffs of 35 per cent and 25 per cent on raw and refined sugar respectively, phasing down to 15 per cent in 1992. The initial tariff rates are set to provide a similar level of support as the current import embargo and domestic price arrangements. The industry has sought a different form of tariff protection, and the government is considering that approach. In addition, the current domestic administered pricing arrangements will be terminated on the expiry on 30 June 1989 of the current Commonwealth-Queensland Sugar Agreement. The industry is considering the desirability of a future Commonwealth-Queensland Sugar Agreement. The Government will introduce further legislation to implement such an agreement if necessary. The revised arrangements for the sugar industry are part of a package of measures based upon the outcome of the recent review of government programs and policies within the primary industries sector, known as the industry development review. The review outcome, which was comprehensive and far reaching, was considered by the Government along with proposals for general industry assistance reductions and proposals for reforming the business taxation structure. This had the advantage of allowing consideration of the important linkages between assistance measures for various sectors as well as their interaction with taxation measures. One of the strengths of the package of measures is that it is not restricted to one or two sectors of the economy. As a result, the outcome should be far more effective than the sum of the individual contributions by each sector. Repeals of Live-stock Slaughter (Export Inspection Charge) Legislation The introduction on 1 July 1988 of a fee for service charging regime under the Export Control Act 1982, for export slaughter floor meat inspection by the Commonwealth, has obviated the need for the livestock slaughter export inspection charge legislation, which related to a per carcass charge on the slaughter of livestock. Australian Meat and Live-stock Corporation Act 1977 The first amendment to the Australian Meat and Live-stock Corporation Act removes the requirement that the Minister for Primary Industries and Energy approve orders to be made by the Australian Meat and Livestock Corporation (AMLC) in relation to the export shipping of meat or livestock. The change is consistent with the Government's policy of deregulating the activities of statutory authorities and will permit the implementation of agreements which have been negotiated between the AMLC and shipping companies on a commercial basis. The second amendment is to vary sub-paragraph 30d (1) (a) (ii) of the Act, pertaining to the time requirements for notification of motions to be put to the annual general meeting of the Corporation. This amendment removes an inconsistency in the Act which resulted from amendments made in 1987. Wool Marketing Act 1987 Wool is Australia's major export earner with exports valued at some $5.8 billion last year. To preserve the competitiveness of wool and its profile as a high quality fibre it is important that we maintain the confidence of buyers in the quality and description of the wool they are purchasing. An important source of this confidence is the integrity of wool testing procedures. Nearly all wool sold at auction is tested for key characteristics which form the basis for a commercial assessment by buyers. This testing is done by testing houses on the basis of a sample. Buyers also visually appraise the wool for sale on the basis of a sample displayed on the show floor. Section 127 of the Wool Marketing Act provides for regulations to be made in relation to registration and inspection of sampling sites and registration of wool test houses. An amendment to provide for the inspection of wool test houses is being considered by Parliament in these sittings. However, there are no provisions for the registration and inspection of wool display areas and sample security areas which are central to the wool selling system. To ensure the integrity of the description of wool and the wool auction system, it is necessary to provide for registration and inspection of these areas. Provision is also required for the payment of fees in relation to registration and inspection costs. Regulation-making powers providing for registration and inspection of wool display areas and sample security areas, and payment of fees in respect of these, will therefore be inserted in section 127 of the Act. The proposed amendments in this Bill have no financial implications for the Commonwealth. I commend the Bill to honourable members and present the explanatory memorandum to this Bill. Debate (on motion by Mr Cadman) adjourned. Bill presented by Mr Kerin, and read a first time. Mr KERIN(Werriwa-Minister for Primary Industries and Energy)(3.39) —I move: That the Bill be now read a second time. The new arrangements for the rural adjustment scheme outlined in this Bill represent a landmark with respect to both structural adjustment policy and the management of Commonwealth-State programs. The Bill will serve two purposes. It will allow the rural adjustment scheme to operate in a more flexible and innovative way so as to address more adequately the changing structural adjustment forces acting on businesses in the Australian agricultural sector. It will also set in place innovative arrangements for the management of Commonwealth-State programs. Under these arrangements the Commonwealth's role will be restricted to setting broad policy guidelines. The States will have total managerial and financial responsibility. They will be accountable to the Commonwealth only for the effective achievement of the scheme's objectives. In a structural adjustment policy sense the Bill recognises that structural adjustment arises from a whole spectrum of reasons, ranging from the adoption of exciting new computer and biological technologies through to the painful process of facilitating the exit from the sector of producers who are no longer viable. Adjustment has become an increasingly more significant issue for the farm business because of the greater degree of volatility of external factors it is now likely to face. This volatility arises from a host of circumstances including variability in world commodity prices, exchange rates, interest rates and climatic conditions. Rigid policy responses and smothering administrative regulations cannot cope with this type of variability. Flexibility and adaptability of policy responses are essential in this context. The Bill also aims at ensuring that structural adjustment assistance does not centre upon the provision of short term, quick fix solutions or on the treatment of symptoms. Rather, it aims to ensure that attention is given to the longer term result and the causes of problems. To accomplish these two aspects the agreement, which is a schedule to the Bill, sets out clearly defined purposes, objectives and strategies which directly address these aims. Commonwealth and State Ministers will meet annually to determine the priorities for the provision of structural adjustment assistance. They will determine which industries are in particular need of adjustment assistance at any time and, if necessary, the types of farm build-up and farm improvement activities which should receive priority attention. For example, if a series of widespread good years has occurred, Ministers may decide to emphasise the provision of assistance for drought proofing or soil conservation measures directed at giving businesses in the agricultural sector the long term capacity to accommodate climatic variations within their normal operations. Provided productive activities of this type can be identified and implemented, Commonwealth funding of the scheme need not necessarily decline in good times when demand for funds, due to the impact of variability of costs and output, declines. To ensure that a long term approach is adopted, the legislation retains the previous Commonwealth commitment to provide funds for seven years. The Commonwealth and the States have developed a range of policy measures with each State having the freedom to choose which measures it will use. For example, some States may wish to engage in limited land trading to facilitate the exit of non-viable farmers from the industry or farm build-up. Other States may decide not to utilise that particular policy measure. The Bill also allows for new policy measures to be developed and implemented in the future to meet changing needs and circumstances. The role of the Commonwealth will be to develop, in consultation with the States, ministerial determinations which will set out the broad policy parameters to be applied to each policy instrument. It will be up to the States to develop the management guidelines to govern the use of each policy instrument. This legislation will also allow for variation between the States in the management procedures adopted with respect to specific policy measures. The third key policy aspect is that there is to be a much stronger emphasis on the notion that farming is first and foremost a business-a business which must be run along sound business management lines if it is to survive and prosper. Two provisions are made in the Bill specifically to facilitate meeting this objective. Training for farmers is recognised as an appropriate activity to be funded under the scheme. In addition, provision is made for ongoing funding to improve the quality of financial analysis which is undertaken before assistance is provided to the farmer. In this context, the Bill aims to ensure that the real causes of a farmer's business problems are identified before assistance is provided. Hopefully, this type of analysis will also allow the States to: integrate the provisions of assistance to farm businesses from a number of sources such as the rural adjustment scheme, State extension services, rural counsellors and private financing bodies; and use a number of the scheme's assistance measures together, in conjunction with each other, more effectively in order to address the adjustment needs of particular farm businesses. The other adjustment policy measure incorporated in the legislation which deserves special mention is the new arrangement for the provision of re-establishment assistance under part C of the scheme. The new arrangement will enable farmers whose businesses are clearly not capable of surviving without assistance into the long term to leave the sector with dignity and to provide a base from which to establish themselves once they have left farming. To facilitate less traumatic and more dignified adjustment the legislation provides for the payment of a re-establishment grant of up to $28,000 to a farmer leaving the sector. This amount is indexed annually and subject to an assets test, excluding personal effects. A farmer will be able to leave the sector with a maximum of $28,000 of assets plus a $28,000 re-establishment grant. As the value of assets rises above $28,000 the re-establishment grant will decline on a dollar for dollar basis. In association with this, the provision of household support assistance under part C will be changed in a number of ways including making it available for a maximum of two years. Commonwealth and State Ministers considered this period allowed more than enough time for the farmer, once he or she has taken the decision to leave farming, to sell the business. It was felt that the old arrangements were having a negative adjustment impact and, in some circumstances, may have been eroding the capital base of the farmer's business. As I have pointed out, structural adjustment policy is not the only matter addressed by the Bill. It is also a landmark piece of legislation in terms of being the first attempt at applying, in the context of cooperative Commonwealth-State relations, the principles of devolution of financial management encapsulated in concepts such as program budgeting and the financial management improvement program. To implement this devolution, the legislation and agreement: include a clear mission statement for the rural adjustment scheme; provide for the State rural adjustment authority to have sole responsibility for the management and administration of the policy measures available under the scheme; provide for the State rural adjustment authority to have total freedom, within the bounds of responsible financial administration, to manage funds provided for the purpose of the scheme; and provide for the establishment of a management information system to meet the States' own management requirements and to allow them to report to the Commonwealth on the effectiveness of the scheme's operations. This approach has been adopted because it has been demonstrated, by the experience of the last three years, that it is impractical for the Commonwealth to control the detailed financial and managerial operations of the State adjustment authorities. As a corollary to these changes it may, of course, be necessary for the States to improve the quality of resources available to their adjustment authorities. The mission statement contained in the statement of purposes and objectives set out in the agreement will, as I have already pointed out, change the policy focus of the scheme. It will aid more effective operation and management of the scheme. It will allow ends and means to be more directly related. It will allow for more efficient usage of funds. It will also aid the States in their accounting to the Commonwealth for the effective operation of the scheme. The legislation will allow the State adjustment authorities maximum management freedom. Policy guidelines will be determined by the Commonwealth; the responsibility for establishing and operating the management arrangements for effectively implementing these policies so as to achieve the scheme's objectives will rest with the States. The Commonwealth will not have any part to play in the management process but it will participate in regular meetings of State adjustment authority officers to provide for exchanges of information on management priorities and hence the more effective operation of the scheme. The financial management of funds provided under the scheme will also rest entirely with State adjustment authorities. They will, of course, need to have their annual accounts audited by a registered auditor in accordance with Australian auditing standards. The radical degree of financial and managerial freedom allowed to State adjustment authorities under the legislation will, no doubt, require auditors to consider carefully the nature of the auditing activities they undertake. Equally, I except that State adjustment authorities will incorporate adequate fraud control measures into their managerial arrangements. The legislation, as part of this greater financial management freedom, will allow the State adjustment authorities to retain, within the scheme, current and future surpluses earned under the scheme and will require them to take over responsibility for the provision of funds to meet possible bad debts incurred under the scheme since its inception in 1985. The last aspect of greater financial freedom for the State adjustment authorities will result from the States being given a single pool of funds under part A of the scheme. The Commonwealth will no longer determine the proportion of funds to be used for particular types of activity under the scheme. It will not set nominal maximum interest rates for the use of part A funds. Also, where appropriate, there will be greater freedom for part A funds to be used to facilities adjustment under part C of the scheme. In this context, I have in mind the new policy provisions for land trading on a limited scale. State Ministers have accepted that the greater degree of policy flexibility and the managerial and financial freedom allowed under this legislation, carries with it the responsibility to ensure, and account for, the effective achievement of the scheme's objectives. I cannot stress too much this requirement for accountability. A State which misuses this freedom, for example, to distort the scheme's objectives or to shift the risk of other State activities on to the scheme, will lose access to Commonwealth funds. It is for this reason, and also to facilitate more efficient management by State adjustment authorities, that the Commonwealth and the States have agreed to set up a compatible management information system for the scheme. Under this arrangement the States will provide the Commonwealth with data on the operations and finances of the scheme in an electronic form. This will considerably reduce the State adjustment authorities' reporting workload. The Commonwealth will undertake its own analysis of this data to evaluate the effectiveness of the scheme's operations. The reports prepared as a result of this work will be provided to the State adjustment authorities and where appropriate to the Commonwealth Auditor-General, the Australian Bureau of Agricultural and Resource Economics and the Department of Finance. Three provisions of the new Bill will impact on the amount of funds provided to the States under the scheme. An additional $1.2m will be provided in 1988-89 to allow the States to improve the quality of financial analysis which is undertaken before assistance is provided to the farmer. The new arrangements for part C will mean some reduction in household support payments but larger payment for re-establishment assistance. It is not possible to assess how these two factors will balance out but it should be noted that funding for part C remains open-ended. The new arrangements for meeting State administrative expenses are expected to result in a saving to the Commonwealth of $0.4m in 1988-89. New part A funding will remain unchanged in 1988-89 at $6.7m. In closing I would like to make three other points. Firstly, I would like to congratulate the consulting firm Coopers and Lybrand W. D. Scott for the excellent report they prepared reviewing the existing arrangements for the operation of the rural adjustment scheme. That report played a key part in the development of this legislation. Secondly, I wish to reiterate that the purpose of this scheme is to allow effective structural adjustment to take place in farm business enterprises. It is not aimed at keeping farmers on the land. Using the scheme to prop up farm businesses that are not viable in the long term is not on. The scheme is aimed at making farm businesses independent of assistance as soon as possible or, if this cannot occur, helping farmers to leave the sector with dignity. The retention of farming as a desirable lifestyle will be a result of effective management of farm businesses and effective adjustment, not an objective of it. Finally, I would point out that this scheme is only part of a package of measures, pursued both at the Commonwealth and the State level, to achieve effective adjustment. At the Commonwealth level other measures which are part of the agricultural adjustment process include tariff adjustment, the funding of research and development, assistance for education in rural areas, the rural counselling scheme, the countrylink program and the country town water supply improvement program. There are also relevant programs at the State level; for example, extension services have a key role to play. I commend the Bill to honourable members and present the explanatory memorandum to the Bill. Debate (on motion by Mr Cadman) adjourned. Bill presented by Mr West, and read a first time. Mr WEST(Cunningham-Minister for Administrative Services)(3.53) —I move: That the Bill be now read a second time. The Administrative Services Legislation Amendment Bill contains amendments to a number of Acts administered by the Administrative Services portfolio. The amendments are of a kind which, in recent years, it has been the practice to include in an omnibus Bill. Amendment of the Public Works Committee Act 1969 As honourable members will be aware the Public Works Committee Act 1969 establishes the Public Works Committee to scrutinise the Executive's expenditure on public works. Since the inception of the Committee, departments and to an extent the Committee itself have regarded `works' as being limited to those of a permanent architectural or engineering nature carried out for or by the government. Moveable works, such as the construction of a ship, or of a submarine, et cetera, have long been been regarded as being of the nature of specialised procurements which ought not be subject to the Act. However, in recent years, legal advice to the effect that moveable works may in certain circumstances indeed be works within the terms of the Public Works Committee Act has called this view into question. To remove the ambiguity as to what comes within the definition of a `work' for the purpose of the Act, the amendments introduced by this Bill provide that a `work' means an architectural or engineering work and specifically exclude intangible things, moveable works and engineering equipment not being integral components of a work. The Bill also expands the definition of work to ensure that works which are financed by deferred payment or similar arrangements are referable to the Committee. In these times of economic restraint government bodies are increasingly turning to alternative methods of financing their public works. Under a deferred payment arrangement, the government body is not required to finance the work during construction but, effectively, it is paid off by instalments after occupancy. Such alternatives to traditional funding are attractive but in some situations the relevant works are not referable to the Committee under the existing provisions of the Act. Where there is a clear intention for the Government and its agencies to become the owner of such facilities, the amendment will allow the Public Works Committee to fulfil its established role. The Bill also provides that, after consultation with the Committee, types of works can be declared to be works or public works by regulation for the purposes of the Act. Similarly, types of works can also be declared not to be works or public works by regulation. This approach is intended to facilitate consideration of new types of projects and delivery systems and to meet changing circumstances. Amendment of the Protective Service Act 1987 The amendments to the Australian Protective Service Act 1987 extend the powers of arrest of protective service officers to the offences of escaping from lawful custody, aiding a person to escape from lawful custody or rescuing a person by force from lawful custody which were recently created by amendments to the Crimes Act 1914. This is essentially a consequential amendment. Amendment of the Commonwealth Grants Commission Act 1973 Honourable members may be aware that presently the Chairman of the Commonwealth Grants Commission must be appointed on a full-time basis, whereas members can be appointed on either a full-time or part-time basis. The amendments to the Commonwealth Grants Commission Act 1973 provide for the option of appointing the chairperson also on a full-time or a part-time basis. Amendment of the Parliament House Construction Authority Act 1979 The Parliament House Construction Authority will have successfully completed the major phase of the design and construction of the new Parliament House by early 1989. There are, however, financial and legal tasks related to the completion and termination of over 500 contracts requiring further work over the next two to three years. There are also minor construction works remaining to be completed. While the functions to be undertaken by the Authority after early 1989 continue to be very important to the completion of the project, the range of matters to be managed will be more restricted than in earlier years. Consequently, the Government considers that the range of skills and experience required by Authority Board members in this period would not need to be as diverse as those required for the current and previous boards. As well, the Act specifies that the Commissioner of the National Capital Development Commission shall be a member of the Authority. During the establishment and construction phases of the project it was essential to enlist the support and assistance of the Commissioner in view of his planning responsibilities for the national capital. However, in line with the projected reduction in the functions of the Authority, continued involvement of the relevant planning authority is unnecessary. In recognition of the change in nature and scope of the remaining work, the Government took two decisions: firstly, that the Authority was to complete its remaining work and be terminated in June 1991; secondly, that consonant with the wind down phase commencing early in 1989, from that time the Authority Board would be restructured reducing its numbers from six to three part-time members, including the position of chairman. This Bill puts into effect the later decision. It is the Government's intention to bring forward in 1991 appropriate legislation terminating the Authority. I commend the Bill to the House and present the explanatory memorandum to the Bill. Debate (on motion by Mr Fife) adjourned. Bill presented by Mr Holding, and read a first time. Mr HOLDING(Melbourne Ports-Minister for the Arts and Territories)(4.00) —I move: That the Bill be now read a second time. The purpose of this Bill is to amend the employment provisions of the Australian Security Intelligence Organization Act. Sections 85 and 86 of the Act provide for the determination of salaries and terms and conditions of employment of ASIO staff by the Director-General of Security, the Secretary to the Attorney-General's Department and the Chairman of the Public Service Board. Sections 34 and 35 of the Australian Security Intelligence Organization Amendment Act 1986 substitute the `Public Service Board' for the Chairman of the Board and the Secretary to the Attorney-General's Department. There is now no longer a Public Service Board or a Chairman. An amendment is therefore required to remove these outmoded references and to ensure that staff of the Organisation receive the benefit of wage increases awarded to the community. In future, salaries and terms and conditions will be determined by the Director-General, who will be subject to any guidelines that the Attorney-General may give him pursuant to section 8a. The amendment to section 8a makes it clear that guidelines under the section can be given in relation to these matters. These amendments thus provide a mechanism for ensuring that public sector policy on pay and conditions is taken into account by the Director-General, as well as recognising the special circumstances associated with employment in the Organisation. The references in sections 85 and 86 to the Secretary to the Attorney-General's Department are also being removed, since it is no longer appropriate for this officer to be involved in the determination of pay and conditions. Financial Impact Statement The Bill has no financial impact. I commend the Bill to the House and I present the explanatory memorandum to the Bill. Debate (on motion by Mr Tim Fischer) adjourned. Consideration resumed. Schedule 3. Department of Administrative Services Proposed expenditure, $1,362,935,000. Mr N.A. Brown(Menzies)(4.02) —Before the adjournment of the debate on the estimates for the Department of Administrative Services earlier today I was taking the opportunity to raise the question of the changes being contemplated by the Government in Commonwealth purchasing procedures. You will recall, Mr Deputy Chairman, that in Question Time yesterday the Minister gave an outline of the changes that were in the Government's mind. Without repeating word for word what the Minister had to say, if I can paraphrase what he said, he indicated that there may be some departure from the current tendering practices. It is true that he said that tendering would still be a very important delivery system, but the burden of his remarks was that there was to be a change from the basic system of tendering for major Commonwealth purchases. He indicated that there would be what are described as selected tenderers who would have prequalifications. It is a new and interesting notion that there should be prequalifications for selected tenderers. It is not clear. Mr West —You should wait. I will make a statement on all this. Mr N.A. Brown —I am grateful for that, but let me suggest a few things-- Mr West —You should not knock everything before you even hear it. Mr N.A. Brown —And the Minister should not be making statements in Question Time if he has not considered what the Government's final position is. That is the point of order we take. The Minister gets up in Question Time and pontificates about considered Government positions, when Question Time was never intended for that purpose. Then, when someone challenges him, he says, `Do not take what we said as being the final word because there is more to come'. I accept that there is more to come. Frankly, there should be more to come. What I am suggesting-I hope in a constructive way-is that before the Minister makes his final statement he should bear in mind the contribution that I am making. You will recall, Mr Deputy Chairman, that I was illustrating that by telling the Minister of a recent Federal Government tendering process I had been acquainted with. When the present tendering system, which has stood the test of time, has in individual cases weaknesses and shortcomings and when particular cases show inadequacies, it is wise to get that system correct first before one starts to think of abandoning it. I was illustrating this proposition by reference to a contract let by the Federal Airports Corporation at Sydney (Kingsford-Smith) Airport for the gift and newsagency shop concession, which is worth several million dollars a year. The Federal Airports Corporation advertised for tenders. The tendering documents included a contract. When this contract came to the notice of the Trade Practices Commission it said to the Federal Airports Corporation, `There are three clauses in this contract which are in breach of the law. They are contrary to the Trade Practices Act'. The Federal Airports Corporation let the tenders close. It let the time expire. So the time had run and was finished. Having regard to the advice of the Trade Practices Commission-you will find this hard to believe, Mr Deputy Chairman-after the tenders had closed, the Corporation changed the terms of the contract, which was the basis upon which tenders had been put in, by omitting one clause of the contract and by amending another two of its clauses. As I say, that was after the tenders had closed. Then-wonder of wonders-having done that, the Corporation awarded the contract, the concession, to the concessionaire who had had the concession in the first place. It did not tell the rest of the industry that it could tender again. It did not tell other tenderers that they had an opportunity-or should have had an opportunity-to submit amended tenders. It did nothing. It changed the contract after the tenders had closed. That is sloppy, loose tendering practice. There is certainly something fishy about the whole procedure. It should be investigated very thoroughly. What I have said is correct. I use it as an illustration for my general proposition that the Government should look very closely, and think twice, before it abandons the present tendering system. It should be improved and made watertight. The DEPUTY CHAIRMAN(Mr Blanchard) —Order! The honourable member's time has expired. Mr WEST(Cunningham-Minister for Administrative Services)(4.08) —The Department of Administrative Services is now one of the largest departments in the Commonwealth Public Service. It was created in July last year after the machinery of government changes announced by the Prime Minister (Mr Hawke). It is all about providing services to the government and to the Commonwealth, and to the Department and its instrumentalities. Its functions are many and varied. The Department covers such areas as the Australian Property Group, the Construction Group, the Parliament House Construction Authority-officials of which are here today-the Surveying and Land Information Group, the Australian Archives, the Australian Protective Service, the Analytical Laboratories, the Bureau of Meteorology, the Purchasing and Sales Group, the Australian Government Publishing Service, the Transport and Storage Group, the Parliamentary Services and Information Group, which provides services to members and Ministers, and even the Commonwealth Grants Commission and the Australian Electoral Commission. The portfolio's total appropriations for the year were $1.727 billion. That was a decrease of around 17 per cent on the previous year's expenditure. There are a number of reasons for that decrease. There was a reduced requirement for the Parliament House Construction Authority, from $297m in 1987-88 to $82m in 1988-89; a non-recurrent Budget neutral transaction in 1987-88 whereby $168m was paid to the Transport and Storage trust account for the purchase of vehicles and equipment as it moved into the commercial mode; the revised funding arrangements for civil capital works which allowed for the appropriation of funds for new works in 1988-89 direct to client departments; and the off-Budget funding of the Federal Airports Corporation and the Civil Aviation Authority. We expect to generate within the portfolio revenue of some $525m, excluding special asset sales of $700m. That $525m is an increase of some 12 per cent on the previous year. Staff resources totalled 17,675 staff years, a reduction of 2.5 per cent. As I just said-and this was not covered in the debate but I should draw attention to the work that is done-the biggest area in terms of employment and one of the biggest, if not the biggest, in terms of expenditure is construction services for civil and defence works and related on-Budget works. There is in train a total ongoing program with Budget approval of $2.9 billion. This year about $801.5m will be expended on the construction program. There are a number of major defence and civil works programs in most States, such as the new buildings for Commonwealth accommodation in Sydney at the Haymarket site-costing $160m-odd-and the fighter facilities at Williamtown, near Newcastle. In Melbourne an even larger Commonwealth centre is proposed, costing $187m, with a moderate amount of expenditure this year. There is the resiting of defence facilities from within Victoria to Mulwala, and that will cost $62.3m all up, almost $11m of which will be expended this financial year. In Queensland, there are the defence works at the Royal Australian Air Force (RAAF) base, Townsville, where construction of the utility helicopter facility is under way. Total expenditure will be over $17m for that project and the stage II RAAF base development at Townsville will cost $20m. There will be significant expenditure in each of those projects in this financial year. There are the new law courts in Perth, finally under way, with a $46.1m total cost, and several million dollars will be allocated this year. We have completed, and it is now operational, the new Commonwealth centre in Adelaide, at a cost of almost $55m. In the Northern Territory, Tindal stage 1 is to cost $200m. That is well on the way to completion, and $25m is expected to be spent this year. Tindal stage II has been referred to the Public Works Committee. That is a $38m project, and we expect a recommendation to come back from the Public Works Committee soon. I expect the House to treat the project with expedition. Similarly, the naval project at HMAS Coonawarra, near Darwin, has Budget approval to the extent of $25m. In the Australian Capital Territory, to ease expenditure on the Budget, as honourable members will probably remember we have put out to tender a project for a new Commonwealth pre-committed leased building at Tuggeranong. I think its size will be 30,000 square metres, and I will be participating in the evaluation of tenders not for a government-owned building but for a pre-committed leased building owned by the private sector. We expect the central office for the Department of Social Security to be housed there when it is completed. I should mention the massive changes under way in the way the Commonwealth will provide common government services to itself. Honourable members will remember I have mentioned this in the House several times at Question Time because I think it is important, as I think the other matter raised by the honourable member for Menzies (Mr N.A. Brown) is important. I will touch on it in a moment and provide further information. We are about commercialising without throwing the public interest baby out with the commercialisation bath water. In other words, it is a case by case appraisal. We will be, as far as we can, implementing cost recovery and commercialisation, which means untying clients to enable them to take bids for work from the private sector if they wish. Honourable members may remember that in this debate last year I said that the Government intended to do this and would work out a series of principles which would govern the way we applied or implemented these changes in the Department, division by division. We have done that. We have completed and endorsed the principles and we have already finalised the decisions for a whole number of divisions. The Australian Property Group is complete, and so are Australian Construction Services and the Transport and Storage Group. The Australian Protective Service, the Australian Valuation Office and the Australian Surveying and Land Information Services are complete, and they are being commercialised to various degrees. Their implementation programs are well under way and I am receiving regular reports on their progress. The Australian Government Publishing Service, which services this Parliament and the departments and does other publishing to a minor degree, is being dealt with now and should be finalised in the next week or so, as is the case with the Australian Government Analytical Laboratories. The Purchasing and Sales Group is now in preparation and should be dealt with soon. That would make nine divisions which have been either commercialised or partly commercialised and made subject to cost recovery in many operational areas. The Committee would agree that we have virtually completed what I said, about a year ago, we would do. I shall give an example of one of these achievements because I am extremely interested in the success of these programs-as I am sure the Opposition is. Australian Construction Services will probably go through the greatest degree of commercialisation of all. Government business enterprises are freed up already and can go straight to the private sector if they wish. The departments will be totally freed up in July of 1991, at the same time as we implement full cost recovery, which will include the cost of capital and so on. A range of costs will be integrated into a charging system which I will then integrate into a corporate plan which will govern the activities of Australian Construction Services. It is already charging commercial fees to the departments and instrumentalities, and will move to full cost recovery in June 1991. We will also be removing staffing levels and allowing the market-that is, the Construction Services' success rate in getting work-to determine how many staff it employs. I now turn to some of the points raised during the debate. The honourable member for Throsby (Mr Hollis) mentioned the Beijing Australian Embassy project. That project was commissioned by the Australian Government and is under construction, using Chinese services. Mr N.A. Brown —It is behind schedule, isn't it? Mr WEST —Yes, it is behind schedule. That is the point the honourable member for Throsby made. We are using a great amount of Australian materials and Chinese authorities are doing the construction. I visited Beijing several weeks ago with the Secretary to the Department of Administrative Services and the general manager of the overseas property group for discussions with the Chinese authorities and Ministers, including the Foreign Minister and the Assistant Foreign Minister and the Mayor of Beijing, to see how we could expedite completion of the project. The background is that the Chinese Diplomatic Services Bureau holds the contract and the Beijing Construction Commission, which is the responsibility of the Mayor of Beijing, is the constructing authority. We were successful in arranging an extension to the original agreement with the Diplomatic Services Bureau of China, which was signed on our behalf by the Australian Ambassador. The end result of this should be that the project is expedited. The extended agreement includes such measures as agreement by the Chinese to increase their construction resources, that is, the numbers of people on the job and the numbers of shifts worked and so on. They are committed to producing a revised construction and management program which should offer completion by the end of next year, October being the date. Mr N.A. Brown —How long behind is it so far? Mr WEST —I think one could say it is fairly substantially behind schedule. Mr N.A. Brown —A year? Mr WEST —It would not be that long, but the Chinese authorities have always said they would finish on schedule in October 1989, and they are still giving us those assurances. The completion date is October 1989 and the Mayor of Beijing has given me a personal assurance that that will occur. The purpose of my visit was to gain those assurances and also to write a new or extended agreement, which in my view-not just the view of the Chinese but my view and the view of my Department-offered a fair chance that that could be achieved. We have done that. They have agreed to increase their resources; they have agreed to revise the construction and management program to allow completion by October 1989, as promised. We will make some changes to our project management arrangements in terms of personnel and responsibilities. There is only a small team there and it is not constructing-the honourable member must not run away with that idea-it is overviewing. The Chinese have agreed to put full time local building inspectors on the job at all times to assure on the spot construction integrity. As a minor matter, I might mention that they have also agreed to provide much extended covered storage space for the containers with a great number of valuable Australian materials. We have been keen to get the maximum use of Australian materials and there are a lot of these materials up there on the site now. I understand that the honourable member for Dundas (Mr Ruddock) raised an issue with regard to the Commonwealth building at Parramatta. I have asked for some explanation of that matter-as to what substance, if any, there is in what the honourable member for Dundas said about the installation of the PABX system and the attitude of the Australian Taxation Office (ATO), for which I am not responsible, of course. The honourable member should understand that. I would like to report to the Committee that the Department of Administrative Services has purchased a PABX from Telecom Australia at $3.2m. The equipment has not been installed as yet. All the proposed occupants that were known at the time, including the Tax Office, were consulted and agreement obtained as to satisfying each client's requirements. The ATO has subsequently reconsidered its needs and regards the current system as now not satisfying its current and future needs. The problem, according to the ATO, is that the system envisaged does not have separate security and is unable to integrate with the new national communications system. My Department is liaising with Telecom to consider rearranging the PABX already purchased to provide two separate systems within the PABX. The review may indicate that modifications are not economic. It is to indicate the preferred option in consultation with the ATO. I will be paying close attention to the outcome of that review. I have already made some preliminary verbal inquiries, and I do not think it would be true to say that even if changes were made, as I think the honourable member for Dundas alleged, we would be $3.2m down the chute. That would not be so because that would refer only to the Tax Office portion of the $3.2m, which could not possibly be the whole $3.2m. I stress the point I have just made: we have not made any decisions on that yet. The Tax Office agreed to a total integrated system and now wants a change and there is a review to see whether change is justified. As it is the client we have to go along with it and see what comes out of the review. I conclude with the comments made by the honourable member for Menzies. First of all, he mentioned the general changes to procurement procedures that the Government has under consideration, and I will return to that in a moment. He also made reference to certain contracts held by the Federal Airports Corporation-which again, of course, is not within the administrative services portfolio-at Kingsford-Smith and to certain concessions and whether or not those contracts may have originally included a breach of Trade Practices Commission regulations. I have that matter under investigation. I am not in a position either to verify or not verify that point here, but I will certainly investigate it and write to the honourable member and give him the facts, whether they are positive or negative. Mr N.A. Brown —I just gave the facts. Mr WEST —The honourable member for Menzies says that is his position. I am telling him that this is the first I have heard of it. In the sense that it has been drawn explicitly to my attention, I will investigate it and get back to him. That is what these Estimates debates are all about. He would not expect me to answer off the top of my head anything he cares to raise on the spur of the moment. We will do it properly and I will get back to him. As to the matter he referred to, which is an extremely important issue and I make no apologies for raising it in answer to a question yesterday, I do not have a concept of ministerial responsibility that says a Minister goes away and works out some major change, puts it through the Cabinet, and then comes back into the House and makes a statement about it. This matter regarding Commonwealth procurement has been under consideration, in case the honourable member has not noticed, for quite some time. It has been put to a number of seminars that have been held quite openly in capital cities with the main players in the procurement industries, suppliers in the private sector. We wanted them to have a good look at it; we wanted basically to test their views. We have done it with the instrumentalities-that is the GBEs-and we have done it with major government departments. The Government has not made a decision yet, but that is all right. It has been out in the public arena for some time. Business is discussing it, the departments are discussing it, and I see no reason why I cannot inform the House about the discussions before we actually take our decision. I am certainly discussing it with our Caucus committees and I will do so again in the next few days, before we go to Cabinet on the matter. That is the background. I conclude on this note: the honourable member for Menzies raised the matter and I am telling him that we are really serious and quite open about this issue. So $8 billion a year is the figure we are talking about in terms of total procurement. The financial management improvement program conducted a review at the instigation of Ministers and the Department. The problem has been that for almost 200 years in Australia and 300 years in the United Kingdom-this all goes back to the British Admiralty systems of procurement by tender-a very rigid system has developed. We have a system now where within purchase and sales groups officers and departmental officers are operating a system-it is not their fault-where the procedure is virtually as important as the end result. No one is game to step outside rigid procedures. For instance, for anything under $2000 one gets a certain number of oral quotes, for anything under $20,000 a certain number of written quotes, and anything over $20,000 goes out to tender whether one likes it or not, unless one gets a certified exemption, et cetera. When the bids come in, there may be a hell of a blue if, for some reason, the officers think that they should not have to accept the lowest tender because of some other reason, such as contractor inability to perform, or whatever. There is always the possibility of parliamentary argument about that sort of thing. If someone leaks what has happened, it can be on for young and old, so to speak. Let me be absolutely clear: I am not seeking to make savings or to streamline a procedure at the expense of probity or integrity. They must be maintained. But in this day and age one cannot say that the private sector acts in the way in which I described earlier-that is, in the manner of a totally rigid system. It can cost us about $60 just to process a very simple order. The Commonwealth spends $8 billion on procurement, to service itself, every year. Mr N.A. Brown —Public money. Mr WEST —Yes. Why should we not try to make savings in that area? We think that we will save at least one per cent, or $80m. We could save as much as 3 or 4 per cent per annum. In other words, we could be looking at savings of $300m to $400m. So why should I not canvass these matters? The Opposition parties were in government for a long time after the war. They were in government in the late 1970s and early 1980s. We heard a lot about deregulation, efficiency, commercialisation and the rest of it, but we did not see any real changes. There has been a lot of deregulation under this Government. I have never been regarded as a great deregulator or privatiser, as the honourable member for Menzies (Mr N.A. Brown) would know, but I am convinced that in this particular field great savings in finance and in efficiency gains can be achieved. In doing so we can and must still maintain probity and integrity. I explained the matter very briefly during Question Time yesterday. Of course, I could not begin to discuss the complex issues involved or what the explicit system might be. The Government must decide those details. However, I said-and I stand by this-that I will recommend to the Government that it no longer be mandatory to go to tender above the current $20,000 threshold. We should let the managers manage in the departments. A system should be chosen that might involve a series of guidelines that we give to them so that they choose the delivery system they think would best serve the transaction that they have in mind. They could decide simply to call for expressions of interest or, as I said yesterday, make a request for quotation, or they could set up preselected tenderers, as is sometimes the case in the construction area, or they could still go to tender with a right to conduct post-tender negotiations. Mr N.A. Brown —With no ceiling? Up to what amount? Mr WEST —No ceiling. We may include in the guidelines words such as these, `For anything over $50,000 or $60,000, we recommend that you follow certain procedures and it is up to you to select the one that suits you best. You must advertise your decision in the Gazette. You must advertise what the result is and you will be held responsible for your decision, and let the market prevail'. That is the position that I advocate. I hope I have covered the debate adequately. I certainly think I have done so. I will get back to the honourable member for Menzies on the one matter on which I was not able to reply to him. I thank the honourable member and the several other honourable members who participated in the debate. Proposed expenditure agreed to. Department of Community Services and Health Proposed expenditure, $1,294,590,000. Department of Veterans' Affairs Proposed expenditure, $1,201,004,000. Mr SHACK(Tangney)(4.34) —The feature that stands out in the appropriations for the Department of Community Services and Health is that this Government's health care system is gobbling up funds at an ever increasing rate, yet is still failing to give taxpayers value for their dollars. The plain facts are these: health costs are rising; the quality of the service in many important respects is declining; and hospital waiting lists-hospital queues-are lengthening. The Parliamentary Library has calculated that in constant 1979-80 prices the changes between expenditure on health in the 1982-83 Budget and the 1987-88 Budget reflect a dramatic increase of 69.3 per cent. This Government, the Hawke-Keating Government-or the Keating-Hawke Government, depending on which faction one belongs to-prides itself on its commitment to social justice and equity. Yet it is this very same arrogant and out of touch Government which has created a two-tier level of service in our health care system-a system in which low income earners, the most disadvantaged and least articulate or influential people, are being treated as second-class citizens. They are the ones who are languishing at the end of the public hospital queues. They are the ones who are waiting for hip replacement surgery, cataract removals and a host of other treatments. They are the ones who are experiencing needless pain and suffering while they wait for surgery which would immeasurably improve the quality of their lives. They stay at the end of those queues while those who can afford private health insurance or who can manipulate the public hospital waiting list system manage to get the treatment they need without delay. It is the greatest and perhaps the cruellest irony that these people are the ones that Medicare is supposed to help. The poor and the disadvantaged stay on waiting lists simply because this Government refuses to acknowledge that its 1983 promise of a national, free and universal medical and hospital service is both unrealisable and unrealistic. These hospital waiting lists of more than 100,000 people are nothing more and nothing less than a means of rationing health care in an effort to contain costs which have dramatically blown out under Medicare. The lists are the tangible evidence of the undesirable and unachievable attempts by this Government to socialise our health care system. To use a colourful analogy, Medicare is a monster eating itself out of existence. It can only be a matter of time before the whole edifice collapses under the sheer weight of its own insatiable appetite-an appetite which has been fuelled by the total breakdown of direct accountability on the part of both consumers and providers of health services. Unless the Government acknowledges that Medicare is the central cause of the crisis in our health care system and abandons its attempts to prop it up by tinkering at the edges, both the availability and quality of health care will continue to decline. The Medicare monster has well and truly outgrown its cage and no amount of sniping at doctors' fees and pharmacy remuneration or snipping away at pathology rebates and the pharmaceutical benefits scheme will bring it back to size. Token gestures such as we find in this Budget, such as removing overseas student access to Medicare and replacing it with a tailor-made private medical and hospital insurance scheme, are not the answer. I want to say something about that measure. It comes about as a result of a Government decision announced on page 124 of Budget Paper No. 1, which states: The cost of providing Medicare services to overseas students will also be recouped, saving an estimated $0.6m in 1988-89 and $1.2m in a full year. There was no explanation given for this decision, simply a bald statement of fact. This may not at first glance appear to be a very central issue in relation to the overall health budget, which is almost $11 billion. Put simply, the Government is asking private health insurance funds to prepare a special table of premiums to cover the medical and hospital insurance of overseas students. I have two concerns about this. The first is that, since the introduction of Medicare on 1 February 1984, the private funds have been prohibited from providing medical insurance and they have no current costings on which to calculate this new premium. There is a very distinct possibility that, because of its special relationship with Medicare, Medibank Private will be well placed and advantaged in having access to such current information vis a vis the private health funds. That is concern No. 1. Concern No. 2 is that private hospitals will be required to charge these students on a full cost recovery basis. I do not think it is too great a flight of fancy to suggest that this move may well be the tip of the iceberg, a softening up process which at some stage in the not too distant future could see all privately insured people being charged the full cost of any services they receive in public hospitals. If this comes to pass, it will be a further blow to private insurance, not only the health funds that provide that insurance but also the nation's need to encourage more and more Australians who can afford such private insurance to undertake such insurance. The problem of the waiting lists, which I identified in my earlier remarks comes about because so many Australians have abandoned private insurance and are clogging up our public hospital system to the disadvantage of the very people that the free and public system, Medicare, is supposed to assist. If the Government continues down that road and if this private overseas move is simply a toe in the water, in its own terms, it will hardly be compatible with the Government's promised free health care system which is supposedly designed to treat everyone as equals. Of course, one does not have to dig around too much to penetrate this smokescreen. One only has to ask those people whose lives are dependent on the 53 drugs recently added to the authority only list of the pharmaceutical benefits scheme. One has only to ask them if they think they are being treated fairly. I will give the House the example of a 12-year-old in my own electorate who is reliant on Epilim to control epilepsy. On visiting her neurologist on the morning of 27 September, she was prescribed more of the drug and the appropriate paperwork was dispatched to the Department. However, the approved prescription did not reach her until Monday, 3 October. Such a delay in receiving a prescription could well have placed her in a life-threatening situation and was in large part due to the fact that, even though the patient's name and address appeared on the prescription, the Department forwarded the authority to the medical practitioner. I ask honourable members whether or not such an illustration of the operation of the new restrictions on the supply of drugs under the PBS arrangements represents either fairness or equity. Clearly it does not-any more than the ever-lengthening public hospital queues represent immediate access to health care in times of need. The Government's ideologically motivated attacks on the private health care system, and on medical practitioners in particular, must also stop. The Government must accept before long the logic of the Liberal and National parties' position: that Australians will get the quality of health care they deserve only when there is an appropriate balance between the public and private health care services. I return to that earlier analogy. The lumbering Medicare monster is not merely a creature whose time has passed; it is a creature whose time has never come, whose insatiable appetite for public funds has always clearly been beyond our means, and as a system it is approaching a crisis point. At the same time as the Government is shovelling more money in to feed this monster in its central concern, it is trying to snip around the edges in an effort to contain the cost blow-out. It simply will not work and before long this Government will have to face up to the fact that it is Medicare itself that is the problem. Our health system was once amongst the best in the world. With the restoration of choice as a central element of health policy as advocated by us on this side of the House, we can again be up with the best of them. Mr JOHNS(Petrie)(4.45) —I address my remarks to appropriations to the Department of Veterans' Affairs. I have some 7,000 recipients of veterans' pensions in my electorate and I am pleased to say that the appropriations and, indeed, the Government's policies on veterans' affairs do them proud. Each and every one of those 7,000 or so veterans is well cared for by the Government. I will detail briefly an account of some of the main features of the allocations of Veterans' Affairs. However, then I will raise what can only be described as a wildly inaccurate petition that is being circulated throughout the veteran community, which purports to criticise the Government for cutting back in some 15 areas of expenditure related to veterans. But first, I deal with the broad outline of expenditure. It is clear that since we came to office expenditure in the portfolio has moved from $2.5 billion in the year 1988-89 to a total of $4.5 billion. We acknowledge that most of that increase is because pensions have been indexed and so many more people are at an age where they begin to pick up the service pension and, indeed, disability pensions. The point I wish to make is that we have held and increased the real value of those pensions, which are so important to the living standards of veterans. Beyond that, though, the fact is that we are also conscious that when people reach a certain age it is critical for them to maintain their health. So amongst a massive allocation that goes to pensions, we are also seeking to shift money into the health care system for pensioners. We have been able to increase the financial funding for those health and treatment programs by some 10.6 per cent. To illustrate that, some $17.5m has been spent on the Repatriation General Hospital at Greenslopes in Brisbane. As part of that, the Government intends to integrate the repatriation general hospitals into State health care systems. So not only are we continuing to spend money on the repatriation hospitals themselves but we want to integrate the repatriation hospitals with the State public sector hospitals. Why? As an example, Greenslopes in Brisbane is some 10 kilometres south of the Brisbane River. My electorate is 10, 15 and up to 25 kilometres north of the Brisbane River. It is a great deal to ask the wife of an ailing veteran to travel 20 or 30 kilometres to Greenslopes to visit that person. Therefore, we are seeking to provide all the best services of public sector hospitals to veterans-but never at the expense of the quality of the service that those veterans now receive in repatriation general hospitals. I have a statistic which relates to the percentage of the treatment population and their distance from hospitals. Nearly 70 per cent of veteran pensioners live more than 15 kilometres away from repatriation hospitals. So it is only sensible to attempt to provide the services that veterans so dearly need closer to home, particularly as it relates to one of my areas, Redcliffe. It is such a long distance from Greenslopes that I believe in the near future pensioners in Redcliffe will be able to use the services of a nearby general hospital. I refer to this enormous amount of misinformation that is circulating amongst the veteran community. I do not know who is circulating the petition. I am not suggesting it is any veteran group but on that petition are listed 15 accusations about how this Government is supposedly cutting back on veterans. The fact is that 14 of these accusations are absolutely wrong. One has some substance. I shall attempt to run through them. First was a complaint that the dependants pension has been deleted. The fact is that the dependants pension was a fairly ancient form of pension that was given to veterans' dependants. It has now simply been outmoded by things like the family allowance and the family allowance supplement. The level of those pensions had not been adjusted for children since 1952 and for wives since 1964. The complaint is about an ancient form of pension which has now been totally replaced through the general social security system. Therefore the first point is totally inaccurate. The second complaint is that the repatriation pharmaceutical benefits scheme does not apply to war widows, their dependants and service pensioners. The fact is that the repatriation pharmaceutical benefits scheme caters for the needs of veterans with war caused disabilities. That has always been so. It is required that a veteran's problems be related to war in order for him to qualify under the scheme. Any other services are provided through the pharmaceutical benefits scheme operated by the Department of Community Services and Health. Thirdly, there has been criticism about a reduction in dental benefits. Again, dental services for veterans with war caused disabilities are unlimited. However, we agree with, acknowledge and clarify the fact that there is a $300 limit on other people for certain sorts of expensive dental treatment, such as bridge work and gold inlays, and frankly that is not the sort of work that is normally done on pensioners' teeth. Fourthly, there has been criticism relating to spectacles and the supposed deletion of the 10 per cent disability pension assessment. In the old days through the Commission it was often the case that a pensioner was given a 10 per cent incapacity rating simply because he had to wear glasses. With the introduction of the guide to the assessment of repatriation pensions, if there is no incapacity remaining once the glasses have been prescribed and are being worn, we simply do not rate it. That is not a great change. For instance, we do not normally allow an incapacity rating for those who wear false teeth, so I do not see any great change there. The fifth criticism concerns an accusation that the Veterans' Entitlements Act took away the protection that totally and permanently incapacitated (TPI) or special rate pensioners had once they reached the age of 65. The feeling was that perhaps beyond the age of 65 they might have their TPI pension taken away. Again, it was always implied in the Act-and we made it explicit in an amendment to the Veterans' Entitlements Act in December 1987-that when TPI and certain other pensions are granted, they are granted for life and they will not be taken away unless, of course, the circumstances change. A sixth criticism is that there is no reimbursement of costs for medical opinions. I presume that this related to the fact that when an individual came before the Commission or the Veterans' Review Board or the Administrative Appeals Tribunal, that person would have to supply the report. The fact is that there is adequate cover under the medical benefits schedule. There are item numbers which cover matters such as examination and written reports by doctors, so the pensioner is covered when he has to call on those reports to give them to the authorities. A seventh criticism-also quite wrong-is that there is means testing of the veterans' children education scheme. That has occurred for years. The education allowances paid under the veterans' children education scheme have been subject to a measure of a student's income for a number years. So that criticism is also inaccurate. An eighth criticism-and I do not know where this came from-is that the intellectually handicapped dependants allowance was somehow cut out. There is no such thing as an intellectually handicapped dependants allowance paid for under the Department of Veterans' Affairs. The criticisms have been struck out eight times so far. I will jump a few of the complaints because I realise that time is short. There is a criticism that there is no automatic admission to private hospitals without departmental approval. Private hospitalisation without departmental approval has never been a feature of the treatment system. There is no change there; it simply has not been a feature. But let us keep in mind that if there is an emergency it is possible for a veteran to go to a private hospital, or if there has been a negotiated agreement between the Department and the hospital the person can still go there. The DEPUTY CHAIRMAN(Mr Blanchard) —Order! The honourable member's time has expired. Mr BRAITHWAITE(Dawson)(4.56) —In following the honourable member for Petrie (Mr Johns) I wish to impress upon him that there has been a series of cutbacks to veterans and war widows throughout this country and it does not do him any good to come in here and protest in the way that he has. Those cutbacks would have been all the greater had it not been for the honourable member for Farrer (Mr Tim Fischer) and the attention that he paid to the adjustments and amendments made to the veterans' entitlements legislation about two years ago. I am delighted to speak on this occasion after the honourable member for Petrie because not only has he made certain allegations in connection with veterans, but in April this year he also made allegations against an organisation in Queensland called the Endeavour Foundation. On that occasion he accused the Foundation of being `vehement in its opposition to the Disability Services Act'. That is what I wish to speak about today. In actual fact the Endeavour Foundation has not been vehement in its opposition, but it has been deeply concerned about the lack of guidelines and cooperation given by the Department of Community Services and Health in the implementation of this Act. It is generally agreed that when that legislation came before this Parliament it had support from both sides of the House. It is in the guidelines and in the gazetting of certain things that the problems have arisen. When the shadow Minister for health, the honourable member for Tangney (Mr Shack), was here he talked about the socialisation of health. In both this Act and the others administered by the Department we have greater control of services by both the Government and the Department passing under the guise of greater accountability. For example, it appears that private suppliers to the disability area are not getting satisfaction, and this might happen in advance. I return to the question of the Endeavour Foundation. This is not a profit-making private organisation. If there is profit in what the Foundation does, that profit is returned to additional services for which it often receives no subsidy at all. The Foundation is not in this field with its hand out. It is not catering for the disabled of this nation in the hope that it will profit from them. On all occasions I have found the Endeavour Foundation to be very good suppliers. The honourable member for Petrie mentioned the case of a Mrs X. In response to the allegations that he made, I must say that I have quite a few references and they are all in favour of the Foundation and what it is doing. I return to the point that there is a grave lack of progress being made in talks with the Department on establishing guidelines. This matter was referred to me more than 12 months ago and I have had recent letters and representations from concerned organisations to suggest that they have not yet received satisfaction. While there have been gazettals of principles and objectives and also of the operational starting date, unless there is a gazettal of the service types under the guidelines the Government will not be able to satisfy these people because they do not want to buy a pig in a poke and go towards 1992 without some assurance that the service models are those that they can agree and work with. They are not against change; they want to work within the system. I suggest that the Government and the Department would do well to listen to the advice of experts in this matter because they have been suppliers in so many ways-in indoor and outdoor activities, sports, residential activities and so on. The honourable member for Petrie claimed that we should deinstitutionalise. Perhaps we should say that we do not want to deinstitutionalise large institutions in order to get people into smaller institutions. If we are talking about removal of institutions, perhaps we should be looking at the education area and our boarding schools. We should be looking at the prisons. We should be looking at the nursing homes and those lines of things because in their own way they are institutions. There is nothing wrong with an institution that is properly run, that gives advantages to the disabled, advantages which they would otherwise not have. I give my support to contradict what was said in that grievance debate, because there were lots of inaccuracies as there were in connection with the Department of Veterans' Affairs. I also suggest that they have a legitimate complaint and that they would like to work and move with departmental officers. I now move to the area of day care and pick up on some of the comments that have been made by the Minister for Finance (Senator Walsh) in this regard. Everybody knows that he has come in for some criticism from within his own Party and from within the Caucus about suggestions he has made to cut back the contributions from the Commonwealth in order that reductions can be made. I have here a regulatory impact statement entitled Children's Services Centres Regulations which was put out by the Victorian Government. It has put up a series of deregulation moves all of which are intended, yet again, not as accountability measures but as control measures. Somewhere along the line somebody has said that in exchange for the provision of 20 per cent of the cost, the Commonwealth wants to take control. This is a State government report. It was commissioned on the basis of deregulation in order to provide more trained staff within the care centres. Coupled with that was a costing requirement. This report gives a costing-I think it is on page 97-which suggests that this increase will be minimal, something like 1.5 per cent per year over a period of five years. In actual fact, this report was commissioned some three years ago. It has sat with the Government since May this year. It was released to the public in August this year and the public was given 21 days to respond, which was impossible given that no input was sought from the voluntary organisations. The cost of this to the Government will be horrific. But worse than that, it will remove the private day care centres that are in existence in Victoria at the moment. Queensland has refused to accept this direction but other States have. In fact, I believe that Tasmania has accepted it to such an extent that the private institutions have gone right out the back door. This report has that capacity. The report has been issued not only in the manner that I indicated but also on false premises. As I said, costing measures were given which do not give the full story. The costing of the additional amounts goes back to 1984 to an award that is no longer included. Organisations and unions will welcome that in the future. In fact, the costing done by a firm of chartered accountants indicates that it will be five or six times the cost indicated in the report. We have had Senator Walsh questioning the cost of child care subsidies. In the Australian newspaper on 10 October 1988 he admitted that subsidising community centres was costing $177 a week in operating costs and $20-odd for capital; that is $197 all up per week. The private day care centres can provide for this at a rate of $70 to $75 per day. So, I suggest to the Minister again that when reports like this come to his notice he do everything that he can to put the proper situation, particularly in view of the concerns of Senator Walsh in this direction. I believe that whatever the area is, whether it is in relation to the disabled, nursing homes for the aged or certainly within child care centres, there is a place for the private system to operate in and compete with the community system. It is up to the Government to ensure that the cost that we keep seeing burgeoning out is curtailed but, at the same time, that the very good standard set by the private system-I believe also by the community based system-is maintained. The DEPUTY CHAIRMAN(Mr Blanchard) —Order! The honourable member's time has expired. Mr LEE(Dobell)(5.06) —I wish to address most of my comments in this committee stage to the Department of Veterans' Affairs. The first thing I would like to do is to read a letter from Mr John Haines, the President of the New South Wales branch of the Vietnam Veterans Association of Australia (VVAA) to the Legal Aid Commission of New South Wales. It is addressed to a Mr M. J. C. Cook of the Legal Aid Commission of New South Wales. It says: Dear Sir, I write to you regarding a letter received from your office informing this Association of resolution passed by the Legal Aid Commission of New South Wales on 27th July 1988, which indicates a means test will be applied by the Commission on Veteran Affairs matters including appearances by Lay Advocates before Veterans Review Board, Appeals to the Administrative Appeals Tribunal and the Federal Court. I wish to offer, on behalf of the Vietnam Veterans Association of Australia, a most severe protest at this means test which if implemented will cause undue and unnecessary hardship to Vietnam Veteran wishing to pursue an appeal through a process that has been available to them for some period of time. Your letter, does not set out the reasons for this new imposition, one can only assume it is another way of reneging on a commitment made to the Australian Returned Serviceman. My initial investigation indicates that upon the transfer of the Australian Legal Aid Office to the Legal Aid Commission of NSW, there was nothing in the agreement that suggested a Means Test be applied in Veterans Affairs matters when the merger took place. Also I have been informed that sufficient funding was transferred at the time of the merger to allow on going funding that would provide funds for a continuation of Legal Aid as was provided for by the Australian Legal Aid Office. If this Means Test is allowed to be implemented it will deny Legal Aid to a very high percentage of Ex Service persons. I would ask that I be allowed to discuss this matter further with members of the Commission so that a severe injustice will not be placed upon those members of the Community who were willing to offer their service for their Community. This letter addresses something which I am very concerned about and something which I believe the shadow Minister at the table is also concerned about. It is a decision of the Legal Services Commission of New South Wales to abolish secretly the right of veterans in New South Wales to legal aid. When legal aid was provided by the Australian Legal Aid Offices (ALAO), veterans had an automatic right to obtain this free legal advice. I know that I and other members from New South Wales often suggest that veterans who come to see their local member with a problem should speak to the ALAO to obtain independent legal advice before going to the Veterans' Review Board or the Administrative Appeals Tribunal or, hopefully in rare cases, the Federal Court. The Veterans' Entitlements Act is so complex that veterans need to have that legal advice to make sure that they have every opportunity of gaining benefits to which they are entitled. Therefore, I am extremely disturbed that a New South Wales Government statutory authority, under the Greiner Government, has decided to abolish this right of veterans in New South Wales to get legal aid. That is something which John Haines, President of the New South Wales branch of the VVAA, has rightly expressed his concern and outrage about. I have been personally contacted by the Hunter Valley and Central Coast Sub-Branch of the Vietnam Veterans Association. They have told me that they are very upset by this decision of the Legal Services Commission of New South Wales. I have taken the liberty of taking this matter up with both the Federal Minister for Veterans' Affairs (Mr Humphreys) and the Federal Minister for Justice (Senator Tate). They advised me in September this year that they wrote to the Attorney-General of New South Wales, Mr John Dowd, asking him to reverse that decision. I understand that to date Mr Dowd, as far as I am aware, has not answered the correspondence from the Federal Ministers. I think we should understand the circumstances behind this decision. When the Australian Legal Aid Offices was amalgamated with the Legal Services Commission of New South Wales the Federal Government agreed to provide funding to the new Legal Aid Commission of New South Wales. I believe that that is a sum of many millions of dollars. Within that allocation, I understand, there is at least $500,000 from the Federal Government to the New South Wales Government to provide continuing free legal aid to veterans. Yet the Legal Aid Commission of New South Wales, a State independent authority, has taken it upon itself to abolish the right of veterans to get legal aid. I think that is something that people on both sides of the chamber should totally condemn. This body is still accepting the money from the Federal Government yet it is no longer giving veterans in New South Wales the right to obtain that legal advice. This is a matter which I mentioned briefly to the shadow Minister for Veterans' Affairs, the honourable member for Farrer (Mr Tim Fischer), the week before last. He told me that he would be making inquiries into this matter as well. I hope that he will speak to his Liberal and National Party colleagues who are Ministers in the Greiner Government to have this decision overturned as soon as possible. What I find even more outrageous is that this decision was made in secret in July this year-a decision which would affect the right of veterans to obtain legal aid from 1 September this year-yet veterans in my electorate, and I am sure in other New South Wales electorates, were simply not told about this decision. Once again, I think that is something which leaves a lot to be desired about open government in New South Wales. I wish to mention some other matters in passing today in this committee debate. First of all, I wish to commend the Government for speedily implementing the major recommendations of the Veterans' Entitlements Act Monitoring Committee. I believe that the Government has done the right thing in picking up those major recommendations to increase the extreme disability allowance. I am concerned about some of the speculation which has appeared in the media about the transfer of repatriation hospitals to the State Health Commissions. However, I understand that the Federal Minister for Veterans' Affairs (Mr Humphreys) has promised that, as part of the negotiations, he will be ensuring that there is not some fire sale handover of the veterans' repatriation hospitals to the State health commissions. I think that is very important. There is no need to rush into this. The Minister has said that he is keen to negotiate an agreement with the State health departments so that veterans will be given priority at local general hospitals. If that can be achieved in my electorate it will mean that veterans on the central coast of New South Wales will not be forced to travel to Concord in Sydney to have operations. It means that their families will not have to travel by public transport for many hours to visit veterans who are in hospital. If the Minister can provide me with a guarantee that the transfer of Concord at some stage in the future will provide my veterans with priority treatment at Gosford District Hospital, that will be something that will greatly benefit veterans in my electorate. As I have said, that will save them from having to travel great distances. The last thing I want to touch on in the time available to me is a proposal by the Central Coast and Hunter Valley Vietnam Veterans Association to construct a hostel in my electorate. I understand that the Vietnam Veterans Association in my electorate has had negotiations with the Department of Community Services and Health with the aim of submitting an application for this hostel later this financial year. I wish to place on record my total support for this proposal which has been named Operation Hostel. I will certainly be encouraging the Minister for Housing and Aged Care (Mr Staples), who is at the table, to ensure that the Government gives every possible consideration to this project because it will be of great assistance not only to Vietnam veterans but also to other veterans and their families in my electorate. It is with great pleasure that I am able to support the decision for this amount of funding which is before the chamber at the moment. Once again I appeal to all members of this chamber to look very closely at this secret decision by the New South Wales Legal Aid Commission to abolish the right of veterans in New South Wales to obtain legal aid. I hope that the shadow Minister, the honourable member for Farrer, who is at the table, will ensure that his promise to me to follow this up with his Liberal and National Party colleagues in New South Wales will be carried out as soon as possible. Mr ADERMANN(Fairfax)(5.15) —Although I wish to speak predominantly to the estimates of the Department of Veterans' Affair, I wish to ask the Minister for Housing and Aged Care (Mr Staples), who is at the table, to convey my deepest personal sympathy, and that of my many colleagues, to the Minister for Community Services and Health (Dr Blewett) in this very distressing and sad time for him. In speaking to the estimates for the Department of Veterans' Affairs I want to place on record that, in all my parliamentary service, probably the most satisfying and fulfilling period was when I had the privilege to be Minister for Veterans' Affairs. I struck a rapport with veterans and their dependants throughout the whole of Australia and they still come and talk to me. Although the honourable member for Petrie (Mr Johns) said that he was very satisfied with the Budget allocation for the Department of Veterans' Affairs and the way that it was going-he read out a list of complaints-I want to assure him that the veterans are far from a happy community. They are a very concerned community. The veterans of his own electorate, which virtually adjoins mine, talk to me. I want to bring some of those concerns before the chamber because I believe that not one of us will not admit that the standard of living, the way of life and the freedoms that we have in this country were very dearly bought for us and defended by our veterans. I remember very well that, when we were recruiting in war-time and men and women were being coaxed to join the Services, many unqualified commitments and promises were made to them. What worries me now is that the time has come to meet some of those pledges and promises and we are trying to back off. We are trying to dilute some of the commitments and the promises that were made. As I have very few minutes in which to speak let me outline some of the concerns that veterans bring to my attention. One is medication. The changes in the national health scheme (NHS) list have caused very great concern and alarm to veterans. When they go to their medical officers and are given prescriptions they find that they have been removed from the NHS list. When inquiries are made they are told that there are substitutes. Sometimes there are substitutes, that is true, but in many cases the substitutes are not acceptable to the doctors. They have tried them and they have said that they are not acceptable; they are not effective. What is worrying many of the doctors who ring me is that prescriptions are apparently to be written by the bureaucracy rather than the medical officers. I want the Minister for Veterans' Affairs (Mr Humphreys) to take on board the concern that I and members from all over the chamber are getting from veterans who are unable to continue with the medication that has been effective over many years because of these changes. The letters that we get back when we write to the Department of Community Services and Health or the other departments are not the sorts of things that give confidence or comfort to veterans who are in this position. I want to talk very briefly about the totally and permanently incapacitated (TPI) and disability pensions. These have been attacked; there is no question about that. Honourable members should ask any of the veterans. The concept of the TPI pension being a replacement pension for not being able to work is one that I have never accepted. I did not accept that when I was Minister; nor do I believe the Department implemented it in that way. It is not a pension; it is a compensation. Mr Tim Fischer —Hear, hear! Mr ADERMANN —Let me say again that it is a compensation. I believe that we ought to remember that very many men, and perhaps women also, were not capable of working when they came back from the wars but they did work. When they ought not to have worked they did not accept a pension and they did not accept a disability allowance. Because of their self-esteem and because they did not want to be cast off by society they struggled on and, at the end of the day, when they cannot work any longer, they find that they are not going to be given a TPI pension. They are not eligible because of this new concept of the TPI pension. I believe that this is unfair and unjust. It is unfair and unjust not only to the men themselves but also to their wives who have supported them, helped them and nursed them through the time that they have tried to work and put in this productive effort. Because they are denied the TPI pension these women, who have stood by them for so long, are denied the war widow's pension at the end of the day. I am not very happy with this new concept. I do not believe it is a compassionate or fair concept. I assure honourable members that no matter what is said it is a new concept. It did not apply eight years ago. Another matter that was mentioned today related to repatriation hospitals. Let us make no mistake, the veterans are very concerned about the prospect of their repatriation hospitals being absorbed into the State hospital system and that repatriation hospitals as such will disappear altogether. The requirement for repatriation hospitals has not yet, in my opinion, reached its peak. Veterans are becoming older and their disabilities are being exacerbated by the process of ageing. We have not yet seen the repatriation hospitals taxed as much as they will be. Mr Tim Fischer —Average age, 71. Mr ADERMANN —That is true. I believe that means that the repatriation hospitals ought to be preserved as repatriation hospitals. Where there are none in the outer centres-and I agree with my colleague from the other side, the honourable member for Dobell (Mr Lee)-the general hospital system ought to be able to accommodate repatriation patients to save them long trips and trauma. It has happened in my time that some of the beds in repatriation hospitals were opened to the public if they were not required by entitled veterans. That is fair enough. That makes sense. We ought not to have empty beds in hospitals. Unfortunately, there is some sadness there because even non-entitled veterans feel that the repatriation hospitals are their hospitals. If they are sick they like to go there. Unfortunately, if they are not entitled, very often that does not happen. That is sad. I appeal to the Minister and I appeal to the Government: do not precipitately get rid of the repatriation hospitals and give them to the State hospital system. Mr Hunt —They have been trying to do it for years. Mr ADERMANN —Yes, they were trying to do it in my time. This ought not to be done. There is another difficulty in Government policy and it relates to the whole scheme of nursing home assistance. I am concerned about the way this is working. I am repeatedly told that I have enough nursing home beds in my area for the population that I serve. I wonder why it is then that all of these nursing homes have impossible waiting lists that are years long. Why are the doctors ringing me saying that they are worried silly? It is because they cannot get people into these nursing homes. Why are anxious relatives beating a path to my door? It is because there are no nursing home beds available. Perhaps some people can get them if they go far away, but I do not think that is a particularly good solution. If it were not for that excellent repatriation nursing home complex in Caboolture, which used to be in my electorate, we would have nothing within cooee of where I live. I am concerned about that aspect. I ask the Minister not to listen to the Department of the Treasury which has been saying for eight or 10 years that service pensions ought to be absorbed into the age pension system because after all it is only the age pension paid earlier. Mr Tim Fischer —Kiss of death. Mr ADERMANN —Yes. There are departmental officers sitting in the chamber. Perhaps some of them have been in the Department a long time. This is not a new song; it is something that has been tried and tried. If the Government wants to get the veterans offside and absolutely destroy their self-respect that is the way to go. Veterans call the TPI the diggers' burnt out pension. Let us not let it become an age pension or a social security handout. I ask the Minister to remember that these fellows are on compensation; they are not being propped up by pensions. Mr JENKINS(Scullin)(5.24) —I had not intended to make comments on the appropriation for the Department of Veterans' Affairs. I wanted particularly to comment on the home and community care (HACC) program, but the honourable member for Dobell (Mr Lee) and the honourable member for Fairfax (Mr Adermann) mentioned the future integration of repatriation general hospitals into the various State systems. The proposal has my support. What must be said is that the decision was made bearing in mind that, under the agreements that need to be entered into with the State authorities, the health care services available to veterans should be maintained. In the comments of the honourable members I mentioned who preceded me, there was agreement on that point. We should not look upon the proposal with the great degree of fear that has been expressed. It is important to recognise that the Government has taken a softly, softly approach to this proposal. It is not something that we have raced into. It is something that has been recognised and it requires a great deal of cooperation by the Federal Government through the Department of Veterans' Affairs and the various State authorities. It is a proposal which has been well researched. Various committees have looked at the proposal. The final recommendations that are being enacted at the moment come out of the report of the Brand Committee of Review of the Repatriation Hospital System of 1984. We should see it in that context. It is something that can strengthen the health care services that are available to veterans. It is a continuing recognition of the Government's requirement to provide services for those who serve the country so well in times of conflict. As I said at the outset, I wish to refer to the HACC program. It is obvious that the program is designed to prevent the premature institutionalisation of aged and disabled people. Its aim is to enable more people to live at home rather than in a hostel or nursing home. The Minister for Social Security (Mr Howe), in his contribution at the committee stage of the debate on the appropriation for the Department of Social Security earlier this day, described the HACC program as a visionary program. That is true. That description recognises the great degree of work done by many people, particularly ex-Senator Don Grimes, both as the responsible Minister after the election of the Hawke Government and in particular as the shadow Minister during his years in opposition. It has to be said that the present Opposition has not come to grips with its role. It has not necessarily kept its eye on alternative policies. If we look at the proposals that were put forward in the recent Victorian State election we will see that the Liberal Party went into that election without releasing a community services policy. In fact, the only reference made to those services was a brief reference in Opposition Leader Kennett's policy speech. He stated that a Liberal Government would build more nursing homes to help the elderly. So we have a winding back, a change in attitude about the direction. I am not sure whether his Federal colleagues agree that that is appropriate. But certainly whilst this Government has a continuing commitment to the provision of nursing home beds and, in particular, hostel beds, it has an overriding commitment to putting in place measures to ensure that more people can stay at home in familiar surroundings. I recently attended a function at which the Minister for Housing and Aged Care (Mr Staples), who is at the table, was a guest speaker. It was the annual general meeting of the Bundoora Extended Care Centre. I think the Minister impressed those who were there with his enthusiasm for his portfolio. He paid tribute to the work being done at the Bundoora Extended Care Centre through its geriatric assessment unit and its provision of a wide range of aged care services in the north-eastern region of suburban Melbourne. In the past the Minister has indicated that Government research has shown that old people much prefer to retain their independence, living at home for as long as possible, rather than entering residential care. In addition, HACC is less expensive than providing long term residential care. This year over $209m will be set aside for the HACC program. This is an increase from $169m in 1987-88 and reflects the importance the Government attaches to the provision of home-based services according to need. HACC services are an integral part of the Government's aged care policy, providing better quality of life through a wide range of services. The diversity of those services should be recognised. Members of the aged population, like other members of the population, have varying needs. If they require such things as a home gardening service or a home maintenance service to enable them to stay in their homes, why is it not appropriate that those services be provided? The issue of aged care is a matter of growing concern to the community. That is as much about the demographics of the population as anything else. As a consequence, the Hawke Government has made policy and program development for the aged a central policy issue. It is a central issue in the context of the Government's commitment to social justice. The HACC program has been a key element in the Government's strategy for the care of frail aged people and people with disabilities. It entails a shift in emphasis from residential care to community based care. The national guidelines for the program, released in April this year, were developed in consultation with State governments and community groups and provide a broad understanding of the program. They also point to a number of areas where further development and review of the program is needed and ongoing. This process should be seen as a fine-tuning of the program. Some of the issues concerning the program which have been raised in the community include resource distribution. There is evidence of inequality in the allocation of resources among the States and of funds between regions within the States. That is a cause for concern. It is appropriate that any government program should be well targeted. It should address the needs of those whom the program was intended to help. There are a number of elements as to why this resource distribution requires further work. There is the matter of historical context. The HACC program subsumed a number of services previously funded under a variety of Acts. We have brought those programs together under the one umbrella. There is a need to continue, where appropriate, the projects funded under those Acts. There is also a need to review the funding arrangements. At the time of the recent Auditor-General's audit efficiency report the services that were previously funded under other legislation constituted 85 per cent of the program. Therefore, 2,380 former Commonwealth-funded programs and 1,665 new projects or extensions of projects receive HACC funding. In this way the determinants for funding under HACC are predominantly historical. As I said, as in other areas of government expenditure there is a need to ensure that the outcomes of such programs as the HACC program are the intended outcomes-that they provide the services to the appropriate people. I hope that is something the Government will take on board. I have pleasure in supporting the estimates before the Committee today. The DEPUTY CHAIRMAN(Mr Ruddock) —Order! The honourable member's time has expired. Mr TIM FISCHER(Farrer)(5.35) —I wish to deal with the estimates for the Department of Veterans' Affairs. In the context of this debate I point out to the Committee that at this moment Vietnam veterans are gathering in Melbourne for their special international reunion, which has been planned for several months. It was a privilege to attend the formal civil reception in respect of the Vietnam veterans' international reunion at the Melbourne Town Hall, albeit briefly, earlier today. I hope that the reunion, which will culminate in a number of observances and commemorations and a march on Saturday, is an outstanding success. Let us deal with some of the honourable members who have spoken in the debate on the estimates for the Department of Veterans' Affairs. As far as the coalition side is concerned, I was delighted with the comments of the honourable member for Fairfax (Mr Adermann). As part of our team approach to this debate, he emphasised the compensatory nature of all service personnel pensions, Vietnam veterans' pensions, war widows' pensions and the like. The honourable member for Adelaide (Mr Pratt), who will also be speaking, will spell out some of the policy aspects of the coalition with regard to a fair go for veterans but, of course, in the context of the Budget Estimates debate. I will be dealing with the extreme disability adjustment and the Australian War Memorial as time permits. Turning to the Government members, the honourable member for Petrie (Mr Johns) argued the case that there had been only one cutback. He failed to nominate that one cutback. Let me say to the honourable member for Petrie and to the Government that there have been a wide range of cutbacks and complex changes in the repatriation area ever since the May mini-Budget of 1985. Let me point out some of the details of those cutbacks. Let us take the poor old Defence Force retirement benefits (DFRB) pensioner for argument's sake. Those pensioners have been hit with a 2 per cent cut which this Government said it would reinstate after a short period. The only thing wrong with that was that the Government did it in such a way that it is a continuing 2 per cent cut to DFRB recipients. It is a breach of obligation, a breach of contract. Even in the most recent Budget, now before the Committee by way of Estimates, there has been no indication that there will be rectification of that cutback. Let us take the case of war widows. What did the Government do to them in 1986? Not only did it eliminate them from the repatriation pharmaceutical benefits scheme, but also it froze at $60 the social security component of a war widow's package, and in such a way that it is not indexed in any way. So its real value is continuing to erode. Then there is the position of veterans generally, particularly country veterans. During a Senate Estimates committee hearing yesterday we flushed out the Department and the officials in respect of the country travel allowance. I can confirm to the Committee that the 1985 May mini-Budget-that horror Budget for veterans-which slashed the totally and permanently incapacitated (TPI) pension arrangements also halved the travel allowance paid to veterans to go from Gippsland to the repatriation general hospital or to specialists in Melbourne and to veterans from Goulburn, in the electorate of my colleague the honourable member for Gilmore (Mr Sharp), to go to Sydney from 27c to 11.16c a kilometre. Since May 1985 there has been only one increase, a very generous increase of 1.12c last year. It is now the princely amount of 12.28c per kilometre. That is about half the Public Service rate. It is still less than half of what the veterans were receiving prior to May 1985. That is a very real cutback which I highlight to this Committee in the context of the remarks made for the honourable member for Petrie. I noted the points made by the honourable members who have spoken with particular interest, including those of the honourable member for Dobell (Mr Lee). He referred to a complex matter-legal advice. I am waiting for some further information on that matter. I am quite confident that there is nothing but sympathy on the part of the New South Wales State Liberal-National Party Government for the plight of the Vietnam veterans and the veterans generally. I am sure that the honourable member for Dobell did not intend to suggest otherwise. I turn to the Budget initiative which was taken from the coalition policy released in the winter recess, which, in turn, was taken in part from the independent monitoring committee report, released after the coalition policy but prior to the Budget, and that is the introduction of the extreme disablement adjustment-a new initiative for which we have been fighting for two years or more to try to overcome the TPI anomaly. This new extreme disablement adjustment, or EDA, was the centrepiece of the coalition's fair go for veterans policy and it provides that veterans in the retirement phase who no longer have access to the TPI arrangements following the May 1985 mini-Budget and the Veterans' Entitlement Act at least will be able to apply under certain criteria for the extreme disablement adjustment which will come in at 150 per cent of the general disability rate. The centrepiece of the coalition policy, I am pleased to say, has now been adopted in this Budget, just a couple of months after our policy was released. I welcome that and give credit to the Government for taking up this aspect of the coalition policy which was also an aspect of the independent monitoring committee report. It goes part of the way, but only part of the way, towards resolving the TPI anomaly. Time does not allow me to detail all the ramifications of the EDA-for argument's sake, the fact that the war widows' eligibility aspect is not dealt with-but we await the legislation which will flow from the passage of this Budget in respect of the extreme disablement adjustment. Hopefully it will be administered in a way which, for once, leans in favour of rather than against the plight of the poor veteran, whose average age now is 71-as confirmed by officials yesterday-and who is sick and tired of these complex changes, sick and tired of the cutbacks and sick and tired of the new arrangements for example on income assessment, which the Government has already backed down on in relation to this Budget, and the retrospective aspects of that package. The extreme disablement adjustment is a most worthwhile step forward but it does not completely solve the problem. However, I welcome it because it was the centrepiece of the coalition's veterans' affairs policy, released during the winter recess. I turn now to the Australian War Mem- orial, which was the subject of a number of detailed questions in Estimates committee hearings and the estimates of which are before the Committee at the present. There is trouble in the Australian War Memorial once again. The officials giving evidence yesterday confirmed that four key executive personnel had, for one reason or another, left the Australian War Memorial over recent weeks and that there are staffing problems there. To quote one of the officials giving evidence, there is a feeling of frustration, especially in terms of the cutbacks of staffing which have occurred-quite savage cutbacks in terms of the original establishment of some 254. I realise that there must be priorities and that there is a very finite Government expenditure dollar especially in respect of veterans' affairs. However, some progress is being made, for example, with savings from the overpayment of service pensions-an amount of $5m listed in the Repatriation Commission's annual report for this financial year-and if only half of that was applied as a reordering of priorities within the Department of Veterans' Affairs umbrella it would be possible to solve overnight the problems associated with that priceless collection of significant military history and memorabilia which is held in our Australian War Memorial. I strongly support, and my colleagues in the Liberal and National parties strongly support, the traditional role of the Australian War Memorial and its being provided with the wherewithal to meet that traditional role in a dignified, appropriate and extended manner. I believe the Government needs to look carefully again at what is happening in the Australian War Memorial, what is happening with staffing, and look again at the priorities associated with the allocations within the overall Department of Veterans' Affairs umbrella to ensure that the Australian War Memorial and its very significant collections which go to the heart of the history and heritage of this nation are maintained in a safe and appropriate manner. I believe I would have the support of veterans, war widows, ex-service personnel and serving personnel across Australia in relation to those comments on the Australian War Memorial. We members of the Opposition parties express our concern over these priorities but welcome the introduction of the extreme disablement adjustment. The DEPUTY CHAIRMAN(Mr Ruddock) —Order! The honourable member's time has expired. Mr PRATT(Adelaide)(5.45) —I want to refer to veterans and the Budget. I spoke earlier today on the plight of retirees and pensioners in Australia under the Hawke Labor Government. Pensioners and veterans alike are getting a rough deal in this latest Budget of the Treasurer (Mr Keating), so much so that their plight can only be called a national disgrace. The Government's constant rule changing since the reform of the Australian tax system has left thousands upon thousands of Australians in the dark as to their future security. People trying to plan their retirements are being frustrated to the extreme by the Treasurer's procession of announcements which make sweeping changes to the status quo. People who have worked their whole lives building this nation, fighting and dying for king and country, are being robbed of the pensions and entitlements they have always believed would be there. At an average age of 71 years, these people are probably too tired to fight but I am more than happy to take up the cudgels on their behalf. As the shadow Minister for Veterans' Affairs, the honourable member for Farrer (Mr Tim Fischer), often quotes, Prime Minister Ben Chifley said of the war: The careers of hundreds of thousands of young men- young men and women- have been interrupted and, in some instances, partially ruined . . . On this Parliament rests the responsibility of seeing that the right thing shall be done. It might be a grand new building that we are in but it is the same Parliament with the same responsibilities to the people who have served Australia. The Opposition clearly recognises that responsibility in the coalition veterans' affairs policy, providing new, efficient initiatives relating to the theme `a fair go for veterans'. In summary, our policy commits a Liberal-National Party Government to: retaining a separate, modern Department of Veterans' Affairs; continuing to provide for an extreme disablement adjustment for veterans in the retirement phase of their lives who suffer further serious war related impairment at the 150 per cent disability pension rate; further improving the repatriation hospital system throughout Australia; continuing to monitor closely the operation of the Veterans' Entitlements Act and the guide to the assessment of rates of veterans' pensions; maintaining the independent monitoring committee; removing all forms of sex discrimination in relation to repatriation legislation; completing the transfer of the private sector of the Defence Service Home Loans Corporation and providing for improvements to the defence service home loans scheme when economic resources permit, including the portability of existing loans; retaining the national flag and maintaining the traditional role of the Australia War Memorial, as referred to by the honourable member for Farrer; and granting the Vietnam Medal to those who served on HMAS Sydney and other logistical support vessels during the Vietnam conflict. This weekend I was with a group of South Vietnamese veterans, army and navy personnel, who had a fundraiser at Athol Park. Mr Chung, Mr Tran and Mr Ho headed up that, and they were raising funds to march in Melbourne this weekend to link arms with our Vietnam veterans. Mr Kerin —They should take John Howard along too. Mr PRATT —I thank the Minister. The Returned Services League (RSL) and veterans groups in my electorate of Adelaide, certainly those that I have been to at Kilburn and Prospect, are concerned about the shabby deal being dealt to them by the Hawke Labor Government. Petitions, I am sure, have been circulated by members on both sides of the House concerning the removal of 53 veterans from the pharmaceutical arrangements scheme, and it is pleasing to those items and to the RSL that the cases of at least 40 of those 53 have come back to be reviewed. One of the deepest of veterans' concerns is the Government's move to divest the Commonwealth of repatriation hospitals throughout the country by the mid-1990s. I refer to the repatriation hospital in Daw Park, which is likely to be absorbed into the State transfer scheme. These men and women understand that the repatriation hospital is like their second home. They want that comfort and the security. Their average age is now 71 years. By the mid-1990s their age and infirmity will become more apparent. As the great body of Australia's returned service personnel enter the period of life when they most need medical attention, the Hawke Labor Government is proposing to wipe its hands of the responsibilities identified by Ben Chifley, of `seeing that the right thing shall be done'. Again we have this situation where a lifetime of planning for a secure retirement-in this case security in the knowledge of adequate medical entitlements-is being shattered at the eleventh hour by the Government changing the rules, reneging on its responsibilities. As I said earlier when speaking on pensions and superannuation, retirement is a big issue. The Minister for Social Security (Mr Howe) accused me of political opportunism, thinking that I would not be able to reply. The Minister claims to have improved the lot of pensioners by increasing the pension by some 8 per cent in real terms. The Minister's claim is a blatant distortion of the facts and I challenge the Government to get the Australian Bureau of Statistics to endorse it. Perhaps he should take a leaf from the book of the honourable member for Capricornia (Mr Wright), who said earlier today that pensioners ought to be those in the community to whom we give special respect. I applaud him for using my line. The same thing applies to our veterans. We have an obligation to give these people, veterans and pensioners alike, that special respect and not to create misery, anxiety and anguish over the future. The Minister accuses me of opportunism over the maltreatment of these people, but he should consider that I might be speaking out on their behalf because I think they are getting a tough deal. If members on the government benches think they are doing such a great job, perhaps they should come along with me and meet some of my constituents, who are sick with sorry over the constant procession of changes to the rules. One facet which was brought to my attention was the suggestion that perhaps the Department should make all veterans members of the St John Ambulance scheme at a cost of about $26 per head. When the St John Ambulance is called, rather than having to pay an average of $126 to take a veteran to hospital he would in fact be linked into the St John Ambulance scheme, there-by saving about $100. Mr McGauran —How much? Mr PRATT —A saving of $100. Multiply that factor across the number of veterans in Australia and I think it would be a worthwhile exercise that I am happy to pursue and give to the relevant Minister. Mr McGauran —But will they regard it in the same light? Mr PRATT —I hope they do. There is no greater gift that one can give one's fellow man than to give one's life. Australian men and women did that. I will always be conscious of their efforts to make this country free and democratic. Payment of pensions to our veterans is compensation and not welfare, as previously stated. The motto of the veterans and war widows of Australia is `Lest We Forget'. I say to the Minister: We must never forget. Mr DOWNER(Mayo)(5.52) —I intervene in this debate to say just a little about those aspects of this portfolio which deal with the housing industry. It is incumbent on me to express the view on behalf of the Opposition that there are really fundamental differences between the approach of the Government to the housing industry and the approach of the Opposition. There are fundamental differences of practical policy but, more than that, there are fundamental differences of philosophy. When one looks at the way the housing industry is going in Australia today, and of course the Government's budgetary policies in relation to housing have to be taken in that context, then in terms of construction there is no doubt that the industry is strong. The Indicative Planning Council estimates this year that there will be somewhere between 150,000 and 160,000 housing commencements. This represents an enormous upturn from the disastrous collapse in the industry in 1985-86, when commencements declined by 11.1 per cent, and in 1986-87, when they declined by 14.5 per cent. Obviously it is good to see that there has been an improvement in those commencements. The trouble is that the industry has been moving madly, like a big dipper, up and down and that has created all sorts of pressures which if we had a more stable housing industry would not have been necessary. One of the reasons why the industry moves up and down is natural cyclical factors, and one would expect some movement up and down. However, I think the reason why the industry has moved so dramatically over the last few years is that so many of the Government's economic policies have impinged particularly heavily on the housing industry. For example, the Government has used interest rates as almost its sole instrument of economic management. Housing interest rates have gone up, not just over the last year, when they rose from 13.5 per cent to 14.5 per cent not just in the last week when they rose in some instances, particularly for those people who have home loans or are taking out home loans with Citibank Ltd, to 15 per cent but over the whole period this Government has been in office, when they have risen from 11.5 per cent to 14.5 per cent. That represents an enormous increase in the burden on people taking out home loans. I recall that the Minister for Housing and Aged Care (Mr Staples), who is at the table during this committee stage debate, put out a press release before the Victorian election, responding to something that I and some of my colleagues had said about the prospect of housing interest rates rising after the Victorian election. The Minister said that it was nonsense that they would rise. The Minister was wrong. The State Bank of South Australia increased its home loan interest rates straight after the Victorian election and Citibank, which of course impinges more on Victoria than does the State Bank of South Australia, also increased its interest rates. We all know that there is enormous pressure on other banks to increase their home loan interest rates. Interest rate pressures have been a major problem for the industry. So has the fact that there have been 23 major changes to government housing policy over the five years that the Australian Labor Party has been in office. The upturn in construction that we have had in the last few months has brought with it its own problems because the industry has come from such a deep trough. Subcontract rates are increasing at something like 20 per cent a year in markets such as Sydney, Brisbane and Perth. In a city such as Perth building costs are increasing by well over 2 per cent a month. We can see, therefore, that through both interest rates and the increases in the costs of building new houses the costs to home purchasers and potential home purchasers are absolutely enormous, and more and more people are consequently being excluded from the housing market. It is well known now, as a national statistic, that 170,000 people are on waiting lists for public housing, 45,000 in the State of South Australia alone. The waiting time on those housing lists is four to five years. The Government's policy is basically that it does not support the principle of home ownership. That is why it is unconcerned about its main instrument of economic policy being interest rates, which is making it so hard for so many people to purchase their own homes. That is why the Government has reduced the first home owners scheme so dramatically-by 42 per cent in the last three years. By 1991 it will be reduced by 75 per cent, according to the Government's own forward projections. That makes it all the more difficult for new first home owners to put down a basic deposit and, in addition, to meet mortgage repayments on their first homes. In my view, the Government is ideologically committed to the whole concept of public housing. Although on this side of the Committee we recognise the importance of public housing, and we are not for one minute saying there is no role for public housing in our society to help those in particular need, we do not think it is the only solution. In contrast, that clearly is the Government's view. It is interesting to reflect on what the report of the Henderson Commission of Inquiry into Poverty said in relation to public housing. The point Henderson made was that there are a considerable number of people in public housing, which is designed to help low income, economically disadvantaged people, who are well off and who do not need that sort of support. By way of illustration to support the Henderson report, honourable members may be aware that one person who has been a beneficiary of public housing is a member of the Senate, Senator Devlin. Senator Devlin is a very lucky man. He has his own senatorial parliamentary salary. In addition, his wife works for him on his electoral staff. So they have a family income, excluding electoral allowances, in the vicinity of $80,000 a year, which is not bad. I think honourable members would agree. Senator Devlin is in a Tasmanian government house for which he pays $74 a week rent. For a family on $80,000 a year to be taking up that kind of urgently needed public accommodation, as Senator Devlin is doing, I submit is completely wrong. The Australian Labor Party often pretends that it is concerned about the disadvantaged, yet we discover that Senator Devlin is taking a house away from the disadvantaged. That simply exposes the contradictions and cynicism of so many of the arguments that it puts to the electorate. Senator Devlin lives in Burnie. In Burnie there are 400 people on the waiting list for public housing. That may not concern Government Ministers, but it is a matter of gigantic concern to those 400 people in Burnie. Senator Devlin is taking away one of those places. In North West Tasmania 900 people are on waiting lists for public housing. Senator Devlin's public housing is costing him $74 a week. His wife works for him at taxpayers' expense as an electorate assistant. Mr McGauran —What? Mr DOWNER —Yes, she works for him. He and his wife are earning about $80,000 a year, excluding his electorate allowance. I think you would agree, Mr Deputy Chairman, that it is a pretty astonishing fact, but a very important illustration of the way in which the Government's ideological commitment to public housing has led to these sorts of anomalies. I hope that Senator Devlin is alone amongst members of this Parliament in depriving low income people of much needed housing, but he is probably not alone amongst high income earners who are also benefiting from the inequities that exist in public housing policies for which, ultimately, the Commonwealth has so much responsibility. Study after study has been produced for the Government to show that it would help the disadvantaged more if it channelled more assistance through the private sector, if it gave more support to the first home owners scheme. In conclusion, the Minister who is at the table knows only too well that the Government's housing policies do not work. That is why he has undertaken a review. He has not actually consulted widely with the industry; he has selected, as I understand it, a handful of economists who will probably come up with the conclusions that he wants them to come up with. The review is a concession on his part that the 23 policies that have already been introduced by this Government have not worked successfully. Let the Committee recall what Senator Devlin has done to deprive ordinary Australians on low incomes, in his case in North West Tasmania, who are struggling to make ends meet-- The DEPUTY CHAIRMAN(Mr Ruddock) —Order! The honourable member's time has expired. Mr IAN ROBINSON(Page)(6.02) —I want to refer briefly to the impact of the severity of the cuts made by the Commonwealth in its allocations to the States on health services. To New South Wales, in the mini-Budget, there was a cut of enormous proportion-no less than $540m. As a consequence the New South Wales Government has found it necessary to prune expenditure on health services. I have a particular concern because of a decision in the last few days to close the only hospital in the upper Clarence area in my electorate, located at Bonalbo. It is a hospital that serves about 4,000 residents. The community is very dependent on an effective health service. If the health service is withdrawn, so far as hospital facilities are concerned, a great strain will be placed on that community because there is no direct transport to other locations. There are no immediate alternatives. It creates very great distress. The consequence of the closure of the hospital will be that the only doctor servicing that community will find it necessary to close his practice because it is quite inappropriate for a doctor to try to serve that area unless he has hospital facilities at his disposal. Likewise, the only pharmacist in that area will not find his business viable if the hospital closes. The consequence of cuts that have been made by the Federal Government to the States in essential health services is something which I am sure is of great concern to this Committee. Whilst time precludes me from sufficiently traversing all of the detail, let me say that hardships created by health services are unacceptable. The Federal Government has a responsibility because of the relationship between the administration of health facilities by the States and all of the other related agencies. We know, of course, that many agencies are jointly funded by the two governments. If these are impinged upon, so far as the availability of adequate funds for essential services is concerned, it will be a very sorry day for communities outside the metropolitan area. Much is said about pressures on hospital services, a consequence of which is long waiting lists for elective surgery. Country people encounter many difficulties if they have to travel to a metropolitan area for specialist health treatment. But it is even worse in remote areas when there is a contraction involving the closure of a 15-bed hospital, with no appropriate alternative. I say to this Committee that the Minister for Housing and Aged Care (Mr Staples), who is at the table, and the Minister for Community Services and Health (Dr Blewett), who is directly responsible for health services, should look again at the impact of overall Budget provisions when both State and Federal instrumentalities are involved. We need to take into account the policies about which we have been informed in great detail prior to the Budget, in previous health debates and in respect of the future of Medicare. There is a very obvious need to ensure that the relationship between each of these services is recognised. Unless that is done the whole pattern of health services falls to the ground in terms of standard and availability to the needy. In the area to which I have referred there are many people who are on social security benefits. There is a large Aboriginal community in the area. All of these people find it increasingly difficult to secure not only immediate hospital accommodation when required but those services that are provided by public hospitals these days. I refer to the provision of outpatient services, immediate needs in the case of accidents, and so on. There is an interrelationship between hospital services, medical services, pharmaceutical services and ambulance services. Unless this is recognised at the Federal funding level and at the level of the administration of the funding that flows through to the States and local institutions-they may be administered by local boards or administrators-it is impossible for us to have a satisfactory health service in the community. Therefore, I make an appeal to this Committee that there should be greater recognition of and greater coordination in the implementation of the funding of our health services. I certainly say that what is being done by the health authorities in the matter to which I have referred is unsatisfactory. My State parliamentary colleague the member for Northern Tablelands in New South Wales has made a strong case to the New South Wales Government in this matter which is currently being considered. I believe that the New South Wales Government, which has recently come to office, has not yet had an opportunity fully to assess the effects of many of the policies that flow from the Federal Government in health services. Of course, it will take some little time in New South Wales to enable a clearer picture to be formulated in respect of the financing, the implementation and the ongoing administration of health services. In conclusion: whatever decisions flow, they must take into account basic health needs. Unfortunately, there is a tendency today for too many well meaning proposals to be given some precedence whilst the real needs of hospital care and medical care are not receiving the priority that they should. It is essential that this be given the highest possible priority under funding which flows from the decisions of the Budget which has just been the subject of debate in this House and, of course, the estimate that is now before this Committee. I appeal to the Minister to ensure that that is considered at all levels in the administration of health services. Mr STAPLES(Jagajaga-Minister for Housing and Aged Care and Acting Minister for Community Services and Health)(6.11) —In response to many speakers in this part of the debate, I will make a number of comments. First, the honourable member for Tangney (Mr Shack) spoke at considerable length about Medicare and the problems the Government faces in that regard. It is worth recording that the honourable member for Tangney is, I think, the fifth shadow Minister since the Opposition has been on that side of the House. As yet the Opposition is still without a comprehensive or any real effective agreed policy between both the parties on the coalition side. So it is a little like blowing in the wind for members of the Opposition to come into the House and talk about health care policy, Medicare or whatever they want to talk about in that regard and criticise the Government when they do not even have a policy themselves. It was this Government that brought in Medicare and it was certainly one of the greatest social justice achievements in the last five years. It is worth noting, as the opposition tends to make comments about social justice in terms of ridiculing the Government, that `social justice' as a term was not really in the lexicon of this Parliament, let alone the Australian population, until this Government came into office. In relation to the issues that the honourable member for Tangney raised about waiting lists, it is worth noting that the Opposition put forward no real solutions, either during this part of the debate or in its policies themselves. The Government has been acting in conjunction with the State governments, not only in building up the whole of the health care system but certainly in addressing the issues in the community of people waiting for medical services. The public hospital waiting lists assistance program is one direct measure taken to address that situation. This program is jointly funded by the Commonwealth and the States on a dollar for dollar basis. The two-year program commenced last year and it is designed or intended to assist specific State and Territory initiatives along the way. These initiatives have included the opening of dedicated surgical facilities, increased recruitment, training of nurses, additional theatre sessions and leasing of private facilities and day surgery enhancement. It is a little early to gauge the full effect of the program, but preliminary reports indicate the program is quite successful in reducing both waiting lists and waiting times, particularly in those areas where it was possible to institute the initiatives rapidly. Some initiatives planned by the States have been difficult to implement as a result of an unfortunate lack of cooperation by groups of medical practitioners in some private hospitals. It is also worth indicating, to bring a little more balance into it, that many of the problems associated with waiting lists are related to a shortage of specialists and, in particular, of trained nurses in Australia. Other areas obviously need to be addressed within the profession itself because, as many doctors would know, access to specialist training is pretty restrictive compared with access to general practice. That is perhaps something that the shadow Minister would like to take up with the medical profession, as the Minister for Community Services and Health (Dr Blewett) certainly has on many occasions. In relation to another matter raised by the honourable member about payment of medical benefits to overseas students, the Government decided in this Budget to discontinue payment of Medicare benefits for services rendered to certain classes of overseas students. This will take effect from 1 January next year. It will affect full fee paying students, and those students now studying in Australia who are sponsored or subsidised under the Government's programs will indeed remain eligible to receive Medicare benefits. It is considered inappropriate by the Government that overseas students who are in fact purchasing an education in Australia should be covered by general taxation funded programs such as Medicare. The honourable member for Tangney suggested that this was a foot in the door to extending this across a broader range. Mr Shack —Toe in the water. Mr STAPLES —I was not sure whether it was a foot in the door, toe in the water or thin end of the wedge. Whatever it was, it is a bit fanciful to suggest that the Government does not have anything like that under consideration. It is quite contrary to the Government's policies. Mr McGauran —You took your time telling us. Mr STAPLES —Maybe, but I had to wait a long time to speak today. On the pharmaceutical benefits scheme (PBS), a few matters need to be raised. Considerable concern has been generated in the community on the subject of authorities. The Government put 53 drugs, on recommendation of those drugs, on the pharmaceutical benefits scheme authority requirement following the May statement. Epilim, a specific pharmaceutical for treating several of the syndromes of epilepsy, is one of those drugs. Unfortunately, the Australian Medical Association (AMA), as distinct from the general medical profession, has sought to go into the community and create a lot of quite unnecessary hysteria and misinformation about what is actually happening and what people can and cannot do. Unfortunately, some members of the Opposition have also sought to make a lot of political capital out of scaring people quite unnecessarily. The honourable member for Tangney mentioned one person in his electorate. Obviously, I would not have the details of that, but the fact is that whether it be for Epilim or any of the other 52 drugs, they are now on authority as a result of being seen as expensive drugs and drugs which have cheaper alternatives, at least for some patients-- Mr Ian Robinson —Only some. Mr STAPLES —That is all right, but there are a variety of ways in which the person can receive that medication without being inconvenienced in any way. The latest information I have from the Western Australian office is that it is a 24-hour turnaround within the Department. Of course, to that must be added the postage times. However, it varies. If there is concern for any person, if the doctor feels that that person should have the medication urgently, there are two other processes. One is the telephone approval on a 24 hours a day basis, and the other is very little different to the situation that exists for any normal pharmaceutical benefits scheme prescription, and that is, the doctor can fill out the authority requirement form, which is effectively just an extra piece of paper under the normal national health scheme (NHS) scrip. The person can then take the top two copies to the pharmacist, as would normally be done, and the doctor would then send in that bottom copy to the Department with the postage paid for by the Department. Again, the Opposition has no enunciated policy on the pharmaceutical benefits scheme. Perhaps it would like to tell us now what it intends to do. How will it cope with the very rapidly escalating cost of the pharmaceutical benefits scheme? The cost of that scheme has gone up almost a couple of hundred million dollars in a year; it will go up much more than that and it is estimated that in three or four years it will cost $2,000m. The Opposition really has not enlightened us today on its policy. Perhaps it will go a `user pays' policy. Perhaps it will delist drugs. Perhaps it will charge people a special premium so that the wealthy will be healthy and those who are poor will not-- Mr Shack —You should be worrying about what you are doing while you are in government rather than worrying about what we will do. Mr STAPLES —But this is the Opposition's opportunity to tell the people of Australia what it intends to do. Honourable members opposite will not do that. In protecting people's health through the pharmaceutical benefits scheme, the Government has ensured that drugs are available to those who the doctors say should have them. A very wide range of drugs is available under the pharmaceutical benefits scheme and people are not penalised if they do not have the money up front. Mr Tim Fischer —ACE inhibitors? Mr STAPLES —If people require an angiotensin converting enzyme, or ACE inhibitor, if their doctor says they need one-usually for moderate to severe hypertension-they will get it. That is quite clear, but Opposition members and others in the community are quite content to go around literally scaring the life out of people by suggesting that they will not get these things. That is wrong-it is wrong both in fact and in the way in which people in the community should be treated. That is just so typical of the way in which the Opposition approaches health and aged care issues. Opposition members talk about these things in this chamber yet they do not have a policy between them. All they do is go out into the community and scare people. We did not hear about any Opposition health policy today; we did not hear about any aged care policy-we heard nothing. Mr Tim Fischer —You heard about a veterans' affairs policy. Mr STAPLES —All right. The honourable member for Dawson (Mr Braithwaite) raised the question of the Endeavour Foundation. The Department of Community Services and Health has been engaging in continuing consultations with the Foundation. I understand that the consultations are still going on and I am sure that the problems that existed there will be solved quickly. The honourable member for Fairfax (Mr Adermann) was concerned about repatriation hospitals being transferred to State hospital systems. In his position he should be aware that no hospital will be transferred unless the priority of access to hospitals and maintenance of the current standards of care provided to entitled veterans and war widows in each State are protected. That planning is continuing in strong consultation with the community of ex-service personnel and people associated with them. The honourable member for Fairfax also expressed concerns about nursing home waiting lists. I point out that there is more to aged care in Australia today than nursing homes. Once again we do not have an aged care policy from the Opposition so we do not know its current thinking on this matter, but when the Opposition was running the country its aged care policy was basically that aged people could either be at home or go into a nursing home. There was no alternative; there was not the full expansion of the home and community care (HACC) program as it is today and there was no expansion of the hostel program which this Government has brought in. In fact, in our seven years in government to 1990 we will have doubled the number of hostel beds in this country from 22,000 to more than 44,000. There is a complete lack of understanding of aged care by the Opposition parties. In the three years from 1988-89 to 1990-91 there will be an extra 199 nursing home beds and 1,809 new hostel beds in Queensland. The figures for Australia as a whole will be 1,409 new nursing home beds and 12,296 hostel beds, making a total of 13,705 residential aged care places. The honourable member for Fairfax complained about problems associated with waiting lists. We have brought another element into residential care under the aged care system and that is geriatric assessment teams. In States where these teams have been operating for some time we have found that waiting lists for nursing homes are dropping because there have been considerable numbers-in some cases of the order of 40 per cent-of inappropriate admissions of people to nursing homes. Those people did not need to go there. People do not want to go to nursing homes unless they have to. Most older people prefer to stay independent in their own homes for as long as possible. The honourable member for Tangney nods his head. Being a compassionate man, he recognises the quality of life and independence that a person has in a hostel or in the comfort and familiarity of the surroundings of his or her own home. That is what the HACC program is all about. In particular, it is what the hostel program is all about. It is improving the quality of life and care in nursing homes and hostels as well as giving people the opportunity for individuality. Queensland has been slow to develop these geriatric assessment processes in recent years, but funding which is being provided in this Budget will increase Queensland coverage in the non-metropolitan areas to almost 100 per cent-I am sure the honourable member for Fairfax will be happy about that-and to about 60 per cent in Brisbane in the next year. I think that the honourable member will find considerable changes in the need for nursing home accommodation. I am sure that a number of hostel places will go to the non-metropolitan areas of Queensland, with the large numbers of ageing people in that State. The honourable member for Scullin (Mr Jenkins) raised a matter that was not raised by Opposition members-the home and community care program. It is worth noting the rapid expansion in the HACC program which is giving people a greatly increased quality of life. It is also increasing greatly the efficiency and quality of the expenditure of Government dollars. Expenditure on this program has more than doubled since it was introduced in 1985. I wish to mention very quickly the matters raised by the honourable member for Mayo (Mr Downer). I apologise that I cannot respond to the honourable member for Farrer (Mr Tim Fischer), because I am only acting on behalf of the Minister for Veterans' Affairs (Mr Humphreys) and I feel it is more appropriate that I respond to the areas of my own portfolio. The honourable member for Mayo pointed to fundamental differences in philosophy between the two sides of the House in many areas of housing policy. There are fundamental differences in philosophy in many regards but the big fundamental difference is in performance. The honourable member talked about disasters in housing. No disaster in the housing industry can equal that which occurred in 1982-83 when there were only 105,000 starts. He talked about deep troughs, but nowhere and at no time in the period of this Government has the number of starts dropped anywhere near as low as 105,000. We are looking at constant years of 120,000 to 130,000 new starts. That is the reality. The industry is strong and this Government is committed to home ownership. The 1986 census shows that home ownership in Australia was higher than it was in the 1981 census despite the very big growth in the number of households over that period. Opposition members do not seem to understand the relationship between an ageing population and the number of houses that we need. They do not understand the relationship between more single parent families and single person households and the requirement for more housing. There is far more finance available now than there was even in March 1986. That is one of the reasons why the housing industry is doing better. Proposed expenditures agreed to. Progress reported. Sitting suspended from 6.30 to 8 p.m. Debate resumed from 29 September, on motion by Mr Howe: That the Bill be now read a second time. Mr CONNOLLY(Bradfield)(8.00) —The Social Security (Review of Decisions) Bill 1988, which is before the House, on the face of it is essentially a technical piece of legislation which was part of the package announced by the Treasurer (Mr Keating) in the May statement and supported by the Minister for Social Security (Mr Howe) in a statement at the same time. It related to the manner in which appeals from the Department of Social Security by beneficiaries, pensioners or would be pensioners or beneficiaries within the community should be handled. The basis of the legislation is to give the power to the Social Security Appeals Tribunal (SSAT) which it previously did not have to make determinative decisions. Previously the capacity of the Tribunal was limited to reviewing the decisions made by the Secretary to the Department of Social Security and making a recommendation on that basis. The SSAT as it is called has in fact been in existence since 1975. Its aim was then, as it still is now, to provide an informal setting for consideration of reviews of decisions made by the Secretary to the Department of Social Security. Since that time, the SSAT has had no legislative foundation and consequently no power to decide cases. The Tribunal currently reviews some 12,000 cases a year throughout the Commonwealth. At present a person may appeal to the Secretary if he does not like the decision of an officer in a branch office of the Department. The decision may or may not be overturned. The matter may also be appealed to the SSAT. However, any decision made by it has not been binding on the Secretary who has in the past had the capacity to reject the SSAT's decision. There have been significant variations in the veto rate. It is interesting to note that in 1978-79 it was 28 per cent; the rate fell dramatically to 6 per cent in 1979-80; it rose to 8 per cent in the following year and settled around 12 per cent for the next four years. Then for some unaccountable reason it rose steeply to 28 per cent in 1985-86. During the following six months the rejection in fact got even higher. It is now 35 to 38 per cent. It might be of interest to the House if the Minister for Social Security, perhaps in his summing up, could give some explanation as to why there has been this rapid increase in the manner in which cases have been dissented from over that period. In such cases the appellant is required to appeal to the Administrative Appeals Tribunal if he believes that a further appeal is warranted. Under the laws that currently stand he can go further; he can take the matter to the Federal Court of Australia. The Administrative Review Council in its report in 1984 suggested that the absence of determinative powers had exacerbated the problem of delay and the processing of appeals. The Council concluded that the conferring of a power of determination would enhance the SSAT's credibility and standing and ensure its independence from the Department. The Bill is, of course, based on the recommendation contained in that report. The Minister for Social Security also pointed out in his second reading speech that the measures when implemented should save approximately $2.8m in 1988-89 and $5.4m in the following year. It would appear that the basis of the savings will be that the administrative costs will be less due to streamlining of procedures. In the Minister's statement he predicted that the new process would simplify appeals and remove the delays currently present when the Department considers the SSAT recommendation. At this point I move my amendment to the motion for the second reading which states: That all words after `That' be omitted with a view to substituting the following words: `whilst not declining to give the Bill a second reading, the House is concerned that while there is a need for an effective system of administrative review, this should not be at the expense of Ministerial responsibility for the quality of departmental decisions and the policies upon which they must be based.'. The principal function of the social security review system is to promote high quality primary decision making. One could go a step further, I suggest, and say that it is a principal function of government, certainly of Ministers, to ensure this high quality decision making. As I said in my amendment to the motion for the second reading, it also follows that the quality of the decisions is to a large degree dependent upon the quality of the policies on which they are meant to be predicated. This can be achieved by influencing policy of administrative change within the Department or by trying to remove or to avoid unnecessary errors. It has been stated in the Legal Service Bulletin of December 1987 in an article by Terry Carney and Peter Hanks, who are no doubt known to the Minister, that on an international comparison Australia does not rate particularly well in achieving that objective. They claim: The reason for such a poor performance lies in major structural defects associated with the review system. These defects arise out of the insulation of the administrative review rulings from the administration and policy processes of DSS . . . from the drafting and revision of Departmental Manuals, from Ministerial and legislative policy, and from the primary decision makers. Perhaps the difficulty faced is that most of the decisions which tend to be the subject of appeal are made by clerks usually around the level of clerk class 5, which in public service terms is relatively low, and people perhaps feel that they have not been given a fair go in the context of the environment in which they made their application for benefits in the first place. But the deficiencies in those three areas which were noted by Carney and Hanks are really quite serious. Up to date it can be argued that the system of administrative review has largely failed to achieve any normative or preventative impact on social security decision making policy or legislation. Unless these structural weaknesses are addressed in some way the question must be asked whether the system will continue to fail to realise its primary goal. If it continues to have so little success in promoting better primary decision making, we surely must doubt its ability to survive in the longer term or to have any really useful objective. It has been said that several forces are combining to place the review system under threat. These include political and economic pressures to reduce government spending, the introduction within the Department of Social Security of computer systems for claims assessment and administration and the dominance of administrative culture with its emphasis on uniform treatment of cases, precise non-discretionary rules, and minimal expenditure on administration. These pressures confront the values of legal culture as distinct from administrative culture which underpins the review system because legal culture should emphasise the accuracy of decisions in individual cases through the impartial review of grievances, accompanied by a fair hearing. The issue was taken a step forward by an article in the Social Security Law and Policy by Kirkwood. He took a view which I must admit is very close to may own. He questioned the fundamental need to have a dual process of review. In fact, one can say it is a triple process of review if one adds the Federal Court to it as well. He took the view: In my view appeals against DSS decisions should go directly to a single specialist review tribunal external to the DSS. Both the Myers Inquiry in 1977 and the Administrative Review Council in 1981 came to the same conclusion. It is for that reason that while the Opposition is not voting against this legislation we believe that it is appropriate in this context to simply add a word of caution to the growing tendency in recent years, which probably dates back to about 1975, for more emphasis to be put on the so-called quality of review and access to review rather than the fundamental question of the need for the review in the first place. That is why the second reading amendment, which I have moved, emphasised that the fundamental requirement is responsibility of Ministers to this Parliament. That is the basis of the Westminster system and, by extension, it is equally required that Ministers call on their officers at all levels to apply the letter of the regulations in the spirit by which those regulations were drafted in the first place. In 1981, we had the proposals of the Administrative Review Council (ARC) which suggested that a social security division should be established within the AAT to hear social security appeals. Kirkwood claims-and I support his view-that that was an ill- conceived idea and it indicated that the AAT had shown itself to be too formal and inflexible a body to ever be able to adapt to the enormous pressure of work which would have flowed from the 1981 ARC proposal. In other words, he does not believe, and neither do I, that the AAT should necessarily be the frontline review tribunal for social security matters. I would be grateful if the Minister, in his summing up, would give some thought to the question of how one can adequately justify a two-tiered system of review when logic would dictate that we would be better to strengthen the SSAT procedures at the cost of AAT procedures. If the processes are to work well, we should put the resources at the first point of contact because one of the advantages of the SSAT approach is that it is meant to be closer to the work place. It is meant to be on a regional basis; it is meant to be on a co-ordinated State level, and so forth. It is to be made up principally of officers on secondment from the Department of Social Security. There will be only one lawyer on the panel, unlike the AAT which is heavily legally dominated, a matter with which I have great disagreement. Mr Smith —What is wrong with that? Mr CONNOLLY —My colleague, of course, is almost a gentleman of the cloth. Mr Smith —Don't accuse me of that; the law is bad enough. Mr CONNOLLY —But God is not the law, or vice versa. So the difficulty we have tended to face in the AAT context is to what extent it is really able and equipped to handle the complexities and human questions relating to social security matters. In the time available to me I will merely go through some of the examples of the decisions which many people, including I might add the Department of Social Security, believe are faulty decisions which have been made by the AAT in that context. Nevertheless, the decision to have a two-tiered social security appeal structure in Australia has really been, in some respects, a backward step for the reasons I have mentioned. It has been suggested by writers on the subject, including Kirkwood, that there has been a fundamental lack of in-depth reasoning as to why it is necessary to build onto existing structures rather than to question the need for those structures in the first place. It has been pointed out-and I think it should be emphasised-that this attitude towards building rather than questioning the foundations started back in the time of the Bland Administrative Review Committee. It claimed that the key body on social security appeals should be the Administrative Appeals Tribunal to make this area consistent with other areas of administrative law. But such a premise has acted as a dead weight on the process of establishing an appeal structure because it has inhibited the consideration of whether the issues in social security law, the nature of clientele of the Department of Social Security, and the numbers of potential appellants all point towards the establishment of a new social security appeals body with no involvement with the AAT at all. I say amen to that because that is the very basis of my contention that we are running a very real risk of using appeals mechanisms as an excuse for not getting the question right in the first place. Every effort should be made at the first level of appeal to make that an adequate, respected and integral part of the process so that those who feel that they have not had a fair hearing within the Department should have the right to appeal to the SSAT. But whether they should then have the capacity to appeal upon appeal upon appeal becomes almost an absurdity in an administrative concept. So, the report of the Administrative Review Council in 1984 was very partial to review. One would almost suspect that the personnel on the Review Council see the sine qua non of their existence as being the need for evermore widening capacities and additional areas of appeal. The Review Council reported in 1984 that the absence of determinative powers had exacerbated the problems of delay in the processing of appeals within the Department. It concluded that conferring a power of determination would enhance the SSAT's credibility and standing and ensure its independence in the Department. As I said earlier, the Bill we have before us is based fundamentally upon the recommendations of that report. But it does not ask this fundamental question: To what extent should we be reducing effectively the power of departmental heads and transferring that power into the hands of so-called supportive administrative review-type machinery? If we do that, where would it leave the departmental head? Where would it leave the officer in the Department who made the decision in the first place? Does he feel that he is truly accountable for the decisions he has to make, or does he feel that it does not really matter because he will probably lose 25 per cent of his decisions anyway? Appellants will all go to the SSAT and, if they do not like that, they will go off to the AAT and, if they still have any money, they will go off to the Federal Court of Australia on legal aid if they can get it. I really question the need for that level of duplication in the review process. If we cannot have a more effective system than that the quality of public administration in this nation will ultimately be the loser and, through that, the Australian people. It has been claimed by the Council that one of the problems of the existing system was that the Secretary had the capacity to overrule the decisions of the SSAT. Under new arrangements he does not have that right to overrule; he has the same right as the appellant-no more and no less. If the Department does not like the decision of the SSAT, he has the right to appeal the same as the appellant has the right to appeal. I ask the House: Is that really right? If the line of responsibility through this Parliament to the Minister, to the permanent head, and down through the Department, is meaningful in terms of vertical responsibility, why should the Secretary, who is responsible to the Minister for the decisions and the processes within his Department, be in a position where he has to face effectively a quasi court-type status to argue the decision made by his officers on his behalf and, by extension, on behalf of the Minister? To me this is a very relevant point and one which I hope the Minister will throw some light on. Having had some experience of public administration myself in my many years as Chairman of the Joint Statutory Committee on Public Accounts in this House it came before me time and again that one of the greatest weaknesses of the Australian public administration system is that the decision-making process and the responsibility for the decisions which are made are now being so effectively diluted-I am glad to see that the current Chairman of the Public Accounts Committee, the honourable member for Hughes (Mr Tickner) is now in the House-that in many cases nobody really takes the responsibility for anything. We pass it all off to get a new review process. The right of appeal to the AAT, following unsuccessful hearings by the SSAT in the past, was introduced in 1980. It is interesting to note for the record the percentage of unfavourable decisions-that is, decisions unfavourable to the Department of Social Security-made by the SSAT. Do not forget that, under the old system, it had no power to make that determination; it had only an advisory power. The decisions were as follows: in 1978-79, 6 per cent; in 1980-81, 8 per cent; between 1981 and 1985, 12 per cent; in 1985-86, 28 per cent; in 1986-87, 36 per cent; and, goodness gracious, it has actually dropped to 30 per cent in 1987-88. About 25 per cent of appellants whose appeals are dismissed by the Department of Social Security following an SSAT hearing have made a further appeal to the Administrative Appeals Tribunal. Just under half of those appeals were decided, either in whole or in part, in favour of the appellant, either because the Department of Social Security conceded the appeal before a hearing, or because the AAT upheld the appeal after a hearing. One must ask: What was the real cost, not just the cost of running the AAT, which is a very shorthand way of covering this particular problem? What was the actual cost in the time of officers of the Department of Social Security who could not perform their normal functions and who were required to appear before the SSAT and the AAT on numerous occasions to try to get appellants' claims adequately processed? The percentage of Administrative Appeals Tribunal hearings made up of Department of Social Security appeals is also significant. In 1981-82 it was 53 per cent; in 1982-83 it was 64 per cent; in 1983-84 it was 44 per cent; in 1984-85 it was 31 per cent; in 1985-86 it was 30 per cent; in 1986-87 it was 23 per cent; and excluding taxation appeals, it was 25 per cent. So the point is quite clear. Social Security appeals before the AAT are a significant part of its normal activities. While the cost of running the AAT is not great-in 1988-89 is will be $7.783m; in 1987-88, the previous year, it was $6.510m-the point I make still stands. The actual costs to other departments on a horizontal basis to satisfy the requirements of the review process are obviously substantially greater than the actual cost of running the AAT itself. In the 1986-87 Budget, the Government announced its intention to review the procedures of the AAT aimed at achieving greater cost effectiveness in administrative review. The terms of reference for the inquiry were to streamline procedures and reduce the number of contested hearings before the Tribunal, and to ensure that Tribunal proceedings are conducted with a minimum of formality. Honourable members may recall that when the Minister, in 1975, I believe, introduced the legislation he emphasised that appeals had to be informal gatherings, but reality over the years has shown that the Tribunal has become a quasi court. Various people who have gone to higher and better things in the legal profession have emphasised the need for it to take on a quasi legal process. While technically it was not meant to base its work on the principle of precedent, in fact, over the years, precedent has become an important element of it. It is in this regard that the social security element often finds itself in a difficult position. If one is dealing with two people with similar alleged criteria, or similar problems or case histories in relation to the reasons why they did not get access to benefits, it is so much easier for an appeal process simply to say `We have these other cases', and for lawyers to trundle up to represent their clients in a legal type environment and to argue the merits of cases, rather than necessarily the details of cases which are meant to be before the Tribunal. In February 1987 the Attorney-General (Mr Lionel Bowen) announced a task force which was due to report `in time to allow any necessary legislative amendments to be introduced in the 1987 autumn sittings of Parliament'. It is now October 1988 and no report has been forthcoming, and an officer of the ARC has confirmed that the task force has been disbanded and no report will be written. Perhaps the Minister for Social Security who is at the table will care to tell the House what happened to this task force. Why was it disbanded? Why is there no report? These commitments were made in February 1987. I now refer to one or two cases in the social security area. I will not mention any names, for obvious reasons. The Department of Social Security claimed that an applicant aged 74, who was a recent arrival from India, was permanently incapacitated at the time of arrival in Australia. This was confirmed by two other doctors. I think for the record one should ask why such a person was allowed to migrate to Australia in the first place. Nevertheless, on arrival in Australia, the applicant claimed that he had contracted asthma. The condition, however, had improved markedly since then. Notwithstanding the applicant's illness, he was offered two jobs within two months of his arrival. The AAT decided that in no way could the applicant's invalid pension be terminated as it would be unfair and irresponsible. From the outside looking in one has to be careful about one's judgments about such matters. While not disagreeing with the AAT that terminating the applicant's invalid pension would be unfair, the great concern must surely be just why a 74-year-old invalid-to use its expression-was allowed into the country in the first place. Surely, if the applicant came in under the family reunion program, one would expect some form of assurance of support to have been given to the Government by his family. Instead, an old man came into the country and went straight onto government welfare. The AAT, in handing down its decision, appeared not to have the slightest concern about such matters. Another case involved the overpayment of the widow's pension by a mere $35,448.70. This applicant was a Hungarian migrant who applied for a widow's pension in March 1980. She stated that she had been separated from her husband since March 1966. She had custody of her son. She ceased work in March 1980. The widow's pension was approved in April of the same year. The Department of Social Security in June 1987 cancelled her pension because she was not a widow as defined by the Social Security Act. It was claimed that she had been living in a de facto relationship since July 1980. The overpayment arose out of the applicant's failure to disclose details of the de facto relationship and therefore she was required to repay the full amount. In the course of the hearing, the following pertinent information was tabled. For 10 years prior to July 1980, the applicant had shared a house with a close friend. She had met the alleged de facto eight months before moving in with him. The applicant looked for a house with the alleged de facto and his son. For mailing purposes the applicant was addressed as `Mrs X' the woman's name being the same as that of the de facto. The applicant claimed no sexual relationship with the man she lived with for seven years. At the hearing's conclusion, the AAT decided that the applicant did not have to reimburse the Department of Social Security for any payments as she was indeed a widow and was not living in any form of de facto relationship. Goodness gracious! If ever there was a case where the Department was right and the AAT was wrong, on the basis of the evidence I have seen, this was such a case. One would have to question the judgment made in that case. There have been many other cases of a similar nature over the years. The Bulletin on 10 June 1986 ran a number of examples of Administrative Appeals Tribunal decisions which it claimed then were conservatively costing the taxpayer more than $1 billion a year. It talked about the case of an elderly couple; an 80-year-old man who shared a flat with a 70-year-old woman. They had lived together since 1965. From 1971 the Department of Social Security treated them as married when it came to their old age pensions. That seemed on the face of it a reasonable thing to do because the woman had signed a statement in 1970 that she and the gentleman had lived as man and wife for five years. In due course the case went forward and at its decision in October 1985 the Tribunal commented that: Before such a relationship (that is a housekeeping relationship) is converted into a man and wife relationship, there must be some kind of spark to ignite the tinder of cohabitation to the fire of quasi-marriage relationship. There are many cases such as this, and nobody in this House could ever seriously suggest that they are not complex-clearly they are. But I end my observations by simply making the point: would it not be better to have a more effective one-tier system of review rather than the existing two-tier system of review which, on the face of it, and on the evidence I have attempted to present tonight, is not only additionally expensive but also runs counter to the fundamental principles of our system of parliamentary government, namely that the responsibilities of decision making rest not only with the Minister but also with the officers of departments at all levels whose role it is to ensure that the Australian people get the best level of administration possible, as quickly as possible, and at minimum cost. Mr DEPUTY SPEAKER(Mr Blanchard) —Is the amendment seconded? Mr Smith —I second the amendment. Ms McHUGH(Phillip)(8.30) —As a brief response to the contribution of the honourable member for Bradfield (Mr Connolly), I welcome the attention the Opposition is giving to this matter at last. It is at least a thoughtful look at the processes, whether we agree or not. But it seems a bit rich coming from the Opposition at this stage. We are, after all, discussing this Government's proposals tonight as a result of its review of a program initiated by the Whitlam Labor Government in 1975. So the thought that has been put into all of this has come from our side of the House. In any event, it is as a result of the administrative and policy reform embarked on by this Government that we have got to this legislation at all. The Social Security (Review of Decisions) Bill, as we have all been saying, establishes by legislation the Social Security Appeals Tribunal (SSAT). The Social Security Appeals Tribunals have existed since 1975 as recommendatory bodies providing an informal and accessible mechanism for reviewing social security decisions. As I said, the tribunals were originally part of the welfare rights program of the Whitlam Government and were established by ministerial directive. Their main advantage to clients has been their accessibility and their informality. Their advantage to the social security system has been their ability to advise the Minister of anomalies in the legislation which have become apparent in attempts to determine appeals. The disadvantage has been that their decisions have not been binding on the Department. Everyone of us knows of cases in our electorates where a constituent has had a good hearing at the SSAT, has had a favourable recommendation and then has been knocked back by the Department. The honourable member for Bradfield gave some of the statistics on the rejections. I will give figures as an example of only one year, in 1987-88 and of only one State, my State of New South Wales, even though up to 12,000 cases a year are dealt with by the SSAT. In New South Wales in that year, of unfavourable recommendations accepted by the Department, there were 99.19 per cent-pretty staggering. Of favourable SSAT recommendations accepted by the Department, there were 73.92 recommendations accepted, and 26.08 not accepted by the Department. So the total percentage of recommendations accepted by the Department was 87.44 per cent and the total of those not accepted was 12.56 per cent. Those knockbacks from the Department can have catastrophic consequences for social security recipients. So can the delays in getting a decision. I would like to quote from what Julian Disney from the Australian Council of Social Service said some years ago. It describes the situation exactly: When a person applies for social security the outcome is very often of crucial importance to his or her personal survival. The amount of money at stake in a particular case may appear insignificant from lofty and comfortable positions within Parliament, the bureaucracy and the legal system. But if payment to a social security claimant is denied or delayed, he or she (and perhaps a number of dependants) may be unable to afford even a subsistence level of food, clothing or accommodation, let alone the means by which to make life more bearable (such as a trip to the football or cinema) or to climb out of the vicious circle of poverty for example, by travelling in search of work). So uncertainty and delays have been exacerbated by the lack of determinative powers at the SSAT level. This legislation gives the power of decision-making to the SSAT, which is the first tier of external review, yet the accessibility and informality will remain. That is the important thing. Real concerns have been expressed about whether the SSAT will become another inflexible, formal structure dominated by lawyers, legal procedures and technicalities. That will not be the case. Proposed sections 188, 193 and 194 of this legislation make that a certainty. It is important, too, that those who are appointed will be, as they have been in the past, understanding, able to listen, approachable and non-threatening, their extra powers giving them only more confidence and generating more trust from the clients. The other important aspect of an efficient appeal system is that it can help the Government identify holes in policy, anomalies, injustices not intended by the legislation and the system. An example of the sort of case handled by the SSAT where an anomaly was shown is the instance of a woman who gave birth to a severely deformed child and the husband declined to recognise the child. He continued to live in the same house for the next 10 years but denied both the child and the mother any financial support. The mother was therefore forced to rely on the social security system. She obtained assistance for 10 years but was denied further assistance after amendments were made to the sole parent's pension entitlements. She was disqualified by the new amendments. She was made ineligible. Because the SSAT is independent of the Department and the Government, it can advise the Minister, give independent advice and bring about changes to the legislation. So the role of the SSAT is very important in helping the Government identify where the anomalies exist so as to adjust policy to suit the real needs of people. The social security system should provide claimants with clear and enforceable rights and duties. Welfare rights as an area of activity has suffered a lack of priority and recognition by the community and the legal system. Few resources have been directed towards protecting rights in this area. The emphasis has been, perhaps, a bit skewed. I quote from an article which appeared in the Legal Service Bulletin in 1985, in which Tom Brennan said of the social security system: That system's primary object currently appears to be to ensure that no claimant receives a payment to which she or he is not entitled. The objectives of the officers within that system appear to be to ensure that the integrity of the system, its procedures and policies are maintained. So much for the perception! He continues: Australians might expect an administrative system whose primary object was to ensure that every claimant obtained her or his full entitlement. Such a change of emphasis can be brought about only through political leadership from the government and through widespread community discussion. Because of the community discussion in the welfare rights area, and because of the courage of this Government, that is now being brought about. In the past few years there have been many changes-great changes-in the social security system. They have come about as a result of the social security review established by the Minister for Social Security (Mr Howe) and conducted by Bettina Cass. That has meant a challenge for the Government. I will quote from a document issued by the Minister in June 1988 entitled Administrative and Policy Reform: Department of Social Security. I certainly hope that honourable members opposite are reading it. It states: The challenge for Government, particularly at a time of significant pressures to limit all expenditure, has been to maintain these social security services to the public and strike an acceptable balance between the twin objectives of `care' and `accountability'. The Strategy of Reform Five broad strategies have been employed to meet this challenge: to maintain and improve real levels of support to ensure the adequacy of social security payments; to encourage entry or return to education, training and employment as the most effective route out of poverty; to further assist low income families with children in order to tackle the problem of child poverty; to ensure that social security programs are targeted to those most in need; and to introduce administrative reforms for greater efficiency, effectiveness and integrity. That is what this legislation is all about. Perhaps the strategy of greatest importance to the Government and of most potential for good in the community is our social justice strategy. The chairman of the Caucus social justice committee, the honourable member for Streeton (Mr Lamb), has urged all of us to ask the following questions of any legislation or reports which come before us. The four principles he has asked us to look at underpin the social justice strategy of achieving greater fairness and equity in society. Will economic resources be distributed more equitably? Will civil, legal and industrial rights be strengthened and more equal? Will there be fairer and more equal access to essential services? Will there be more opportunities for the community, especially clientele, to be involved and participate? I say to the honourable member for Streeton, chairman of our Caucus social justice committee, that this legislation provides the answer `yes' to all those questions. Because this legislation establishes the SSAT by legislation and provides for its decisions to be binding on the Department and the claimant, it thereby will directly enhance the equality of legal rights by providing an effective and accessible mechanism for social security claimants to secure their rights in those cases where it is claimed that the Department is in error. While enhancing equality the Bill has a number of provisions to guarantee the access of everyone to the SSAT. Some of these provisions are worth mentioning briefly. Proposed section 168a provides for payment of pension to continue pending appeal; 176 sets out the objective of providing a review mechanism which is fair, just, economical, informal and quick; 179 provides that appeals can be made by phone, and can be lodged at any office of the Department; 188 will prevent the development of adversarial procedures by requiring that the Department can only make submissions in writing, provides for hearings by telephone, and acknowledges the need for interpreters; and 193 and 194 require that hearings be private and informal. So much for the fears that this new legislative program will make the procedure too formal and too legalistic. Proposed section 203 provides for payment of an applicant's medical costs; and proposed section 205 gives a right of appeal to the Administrative Appeals Tribunal from the SSAT. I commend this extremely important legislation to the House. Ms JAKOBSEN(Cowan)(8.41) —It is a pleasure to follow the honourable member for Phillip (Ms McHugh) in this debate and I am pleased that she has already ably outlined the way in which this legislation will impact on the Social Security Appeals Tribunal (SSAT). I will briefly refer to a few of the areas that she has covered which I believe are worthy of reiteration before looking at the Social Security (Review of Decisions) Bill from the perspective of the claimant in the system. The honourable member for Bradfield (Mr Connolly) selectively quoted from some Administrative Appeals Tribunal (AAT) decisions, and it needs to be pointed out that it is always difficult to assess the correctness of such decisions when they are isolated from the full facts. However, he may like to bear in mind that this legislation has the capacity to reduce the number of appeals to the AAT because those people who obtain a satisfactory decision from the SSAT in its amended form will not now have to fear a reversal of that decision by the Social Security Department and then subsequently have to follow their initial appeal with a secondary appeal to the Administrative Appeals Tribunal. That ought to cut down the workload of the AAT and the cost to the Government. This Bill will formalise access by social security claimants to an informal, quick and most importantly free mechanism of review which will have determinative powers which will be binding on the Department of Social Security. It will provide for a review to be conducted by the SSAT in the first instance and subsequent appeal to the Administrative Appeals Tribunal will remain available to the claimant in the event of dissatisfaction or disagreement with the SSAT's decision. Currently the SSAT has no legislative foundation, as a number of speakers have already indicated, and consequently has not had the power to decide cases in a substantive way. Its function to date has simply been to recommend to the Secretary to the Department that a decision under review be affirmed, varied or set aside. The Minister for Social Security (Mr Howe) has to be commended for introducing this legislation, which will make the SSAT a statutory tribunal with responsibility for the first level of external review. The Social Security Review Tribunal's lack of determinative power has caused problems for a number of people in the system. As the Minister pointed out in his second reading speech, it has been the subject of comment by many observers, including the Administrative Review Council-the honourable member for Bradfield referred to this also-which concluded that conferring a power of determination would enhance its credibility and standing. The need for this determinative power is illustrated by reference to the problems encountered by one of my constituents. I have no doubt that other members will have examples very similar to this one. The person concerned received a lump sum compensation payment last year. His dilemma began when his solicitor incorrectly advised him that he could use his lump sum to pay off his debts, including his mortgage, and then apply to Social Security for the invalid pension which would take effect immediately. However, a discussion with the Department subsequently revealed that he would not be eligible to receive a pension for two years because of the size of the loss of earnings component of his compensation; that is, the Department, it appears correctly in this case, treated the whole of the lump sum as a loss of earnings and did not discount at all the medical, legal or other expenses which are allowed to be taken into account. As a consequence of this decision my constituent was totally reliant on his children for financial support with the day to day costs of living. He subsequently appealed to the Social Security Review Tribunal for reconsideration of his eligibility for invalid pension in the first instance and a proportion of his compensation which should be treated by the Department as loss of earnings. Although the Tribunal acknowledged the difficulties confronting my constituent, it did not recommend that he be granted the invalid pension immediately, and I suspect that that probably was the correct decision. It did, however, recommend that the Department of Social Security should reduce the lump sum by 30 per cent to take account of past and future medical expenses, legal costs and so on. Thirty per cent of the sum involved works out at approximately $11,000. Unfortunately for my constituent the Department chose to disagree with the Tribunal's assessment and opted instead to reduce the lump sum by only $4,000. This may not seem important in the overall scheme of things, but it was crucial to my constituent's welfare, given that it would mean that he would have to wait longer to qualify for the invalid pension than he would have had the Department accepted the decision of the review tribunal. For instance, the reduction of $4,000 has the effect of bringing his pension eligibility date forward by three months. Had the suggested amount of approximately $11,000 been agreed to, his eligibility date could have been brought forward by almost nine months, that is, he would have been in receipt of the invalid pension now instead of having to wait until January next year. The Department's decision left only one avenue of appeal open to my constituent-the Administrative Appeals Tribunal. Given the formal nature of the AAT hearings, he concluded that legal representation would be necessary in order to present his case to the maximum advantage. He applied for legal aid so to do but he was rejected. The Legal Aid Commission's reasons for refusal were as follows: There is no reasonably arguable ground of appeal and the expense to the legal aid fund of conducting an appeal cannot therefore be justified. The remarks accompanying the refusal read: The proceedings are not likely to be determined in a manner in your favour. I find this refusal itself to be mystifying, given the position of the Social Security Appeals Tribunal on at least one aspect of the matter. Unfortunately, my office was not advised of the refusal and I was therefore not able to request reconsideration of the decision or explore other avenues of assistance which may have been available at that time. In any event, because legal aid was apparently not available my constituent did not proceed with an appeal to the Administrative Appeals Tribunal, which would have been the correct course, and has still not qualified for the invalid pension. Had the Social Security Review Tribunal had deliberative powers, the Department would not have been in a position to reject or ignore its ruling and my constituent would not still be dependent on the goodwill and charity of his family. Furthermore my constituent and his family would not have had to suffer the stress which was undoubtedly involved in pursuing justice in the way that they have had to and his case would have been resolved more quickly as well as in a more satisfactory manner. The Minister has since recognised the difficulty of assessing legal and medical expenses on a case by case basis and changed the legislation to permit 50 per cent of compensation lump sums to be taken as a fairer measure of such costs. I commend him for that decision also. However, because there is no room for retrospectivity in the legislation which has achieved this change, it is not possible for my constituent to take advantage of a policy which would have rendered him eligible for the invalid pension some months ago. That sounds like a very long and drawn out story and I think it probably is not as uncommon as it might appear. Mr Martin —When is the video coming out. Ms JAKOBSEN —The video is coming out next week. It is also the story of somebody who does not have English as a native language and who had to have the services of an interpreter at the original Social Security Appeals Tribunal hearing. I am absolutely amazed, as I said, that legal aid was refused for an AAT hearing under the circumstances. It illustrates the importance at that early stage of one decent avenue of appeal which has the power to advise the Department what it should do. I sincerely feel that the Minister for Social Security (Mr Howe) has taken the correct decision in pursuing this line and that it will ensure greater equity for all people within the system who have claims to make and who believe that they have an objective to pursue which has not been met properly by the Department. It will cut down on the workload of the Administrative Appeals Tribunal at the same time. It is very important that the altered Tribunal be able to shorten the period during which the Department of Social Security must make its submission to the Tribunal in cases of financial hardship, as this case obviously was, because the person is placed in a very difficult predicament if the matter goes on over a very long time. It is also important for reasons of equity that an appellant is able to be represented at a hearing by any person he chooses. In other words, he can have one of his family there or a friend or a member of Parliament or somebody he believes will represent him properly. The other aspect that is worthy of mention is that notices of appeal will continue to be received either orally or in writing and that the receipt of an oral request will be acknowledged in writing so that there is no chance of the oral request being lost in the system. Legal costs will not be met or awarded. I understand that in relation to the Tribunal, but legal costs will not be required in most circumstances because, very importantly, the Tribunal will retain the informal element that it has had to date. I think that informal element does encourage most claimants to go to the Social Security Appeals Tribunal feeling reasonably confident that they will not be intimidated and will have a fair hearing. By the same token, the Tribunal will not be bound by rules of evidence or notions of judicial procedure as the Minister indicated, and hearings will be conducted in private unless the member presiding at the hearing has decided otherwise. It is very important that this should happen because it has been pointed out-I am not sure whether the honourable member for Phillip (Ms McHugh) mentioned it-that there have been cases where the AAT puts forward all the information and the person's privacy, which has been so scrupulously maintained during the Social Security Appeals Tribunal hearings, is lost. I would like to commend the Minister on the Bill and to commend it to the House. I believe it is an excellent piece of legislation and one that is long overdue. I congratulate him and the Government for bringing it forward. Mr SNOWDON(Northern Territory)(8.53) —I commend the contributions of the honourable member for Phillip (Ms McHugh) and the honourable member for Cowan (Ms Jakobsen). I think they illustrated clearly the purpose and function of this legislation. I point out to the House and to those listening that this legislation is part of the Government's systematic pursuit of a fair go for all Australians. It is another step in fulfilling this Government's commitment to social justice, which has already been demonstrated by the one million new jobs that have been created; the removal of the tax lurks for the privileged; universal health cover; better education; better housing; the alleviation of child poverty; and our commitment to the Aboriginal and Torres Strait Islander people. Social justice underpins this Government's whole policy setting agenda. It ensures that the benefits of a growing economy are distributed equitably, at the same time improving equality of opportunity and, as in the Social Security (Review of Decisions) Bill 1988, ensuring that the rights of people, especially the underprivileged, are enhanced. As the honourable member for Phillip pointed out, the honourable member for Streeton (Mr Lamb) elucidated four key elements of a just and equitable society. I will repeat them for the benefit of the House: equity in the distribution of economic resources; equality of civil, legal and industrial rights: fair and equal access to essential services such as housing, health and education; and the opportunity for participation by all in personal development, community life and decision making. The strategy which is outlined in this legislation is part of the reform of the Department of Social Security (DSS), and the Government has employed a strategy which has five broad principles. They are clearly outlined in the document referred to by the honourable member for Phillip, the statement by the Minister entitled `Administrative and Policy Reform: Department of Social Security 1983-88'. The five key points of that strategy are to maintain and improve real levels of support; to ensure the adequacy of social security payments; to encourage entry or return to education, training and employment as the most effective route out of poverty; to further assist low income families with children in order to tackle the problem of child poverty; to ensure that social security programs are targeted to those most in need; and to introduce administrative reforms for greater efficiency, effectiveness and integrity. That is exactly what this legislation does. Before I go on to outline the important aspects of the legislation as I see it, I would like briefly to comment on the contribution from the honourable member for Bradfield (Mr Connolly). Indeed, I found his contribution most interesting, but I think there was a fundamental flaw, a misunderstanding of the purpose of the proposed tribunal and its functions and what it would mean to the public sector. Far from meaning, as the honourable member for Bradfield suggested, that public sector employees would be less accountable to the Department of Social Security, I would have thought that scrutiny by an external tribunal such as is being proposed by this legislation, with the final determination being made by the Social Security Appeals Tribunal (SSAT) and not subject to the final will of the Department or its officers, would make Social Security staff more and not less accountable. In addition the structure imposes the threat of external review and will put pressure on DSS to ensure that its decisions are administratively and legally correct and in accordance with the Government's policy directions. In addition, the honourable member said he believed that there would be a prevalence of claims to the Administrative Appeals Tribunal (AAT). Like the honourable member for Cowan, I reject that view. I believe that one could reasonably expect that the number of appeals to the AAT would be significantly diminished as a result of this review and the role and the mechanisms of the Social Security Appeals Tribunal. The Bill is part of moves to develop a more rational and, importantly, understandable system of decision making in social security. It will assist social security claimants to secure their legal entitlements to pensions, benefits and allowances. Social security claimants will now have access to an appeal system which will provide a quick, cost efficient, just and authoritative decision making mechanism. While the Bill gives the Tribunal more extensive powers, it is also designed to ensure that appeal procedures remain informal and accessible. One of the key aspects and one of the most laudable aspects of the SSAT is its informality. Appellants do not require legal representation, it is more informal, there are no rules of evidence, it is far more accessible, and they will get a quicker result than in the courts. I believe that that has a great deal to be said for it. It is far more efficient to do it in this way, with the final determination being with the Tribunal, than having to go back to the Department, as the honourable member for Bradfield wants. The Bill will indeed make appeals a lot shorter. I would expect that on non-medical and non-assets appeals the turnaround will be within six weeks of lodgment. That would lead to about a 60 per cent reduction in the time between the lodgment of normal appeals and the outcome. It will also be shorter because the Department of Social Security will no longer have to consider the recommendations of the Tribunal. The present absence of the determination power by the Tribunal has been one of the major deficiencies of the current system and has led to delays in processing and finalising appeals. The Tribunal will be able to meet reasonable medical and travel costs for appellants. The Tribunal is very important in the context of my electorate-perhaps more so than most areas of Australia. The demography and the geography of the place make that so. I shall go through for a moment the types of concerns that are experienced in the Northern Territory and explain the dependence upon the Department of Social Security and the payments made by the Department. As of 7 October 1988 the number of people on unemployment, sickness and special benefits in the Northern Territory was 9,671. As of 2 September 1988 the number of people on invalid, age and supporting parent pensions was 9,183. As of July 1988 the number of families receiving family allowance was 21,549. As of 16 September 1988 the number in receipt of family allowance supplement was 940. I think that that illustrates the importance of the social security system to the population of the Northern Territory. Other figures which demonstrate the system's importance not only to the whole community but also to a particular group within the community are the unemployment benefit figures. In the Northern Territory Aboriginal recipients comprise 20 per cent of all of those in receipt of the unemployment benefit. In some communities the figure is a great deal higher. In Nhulunbuy it is about 78 per cent; in Katherine it is about 35 per cent; in Tennant Creek it is about 38 per cent; in Darwin it is 12 per cent; and in Alice Springs it is 20 per cent. These people, by and large, are not only dependent upon unemployment benefit payments but also in almost every case are dependent in another way upon the social security system. It is important, therefore, that they are treated in an equitable and fair way and in a way which meets their demands in terms of service delivery. The area covered by the Northern Territory Social Security Appeals Tribunals includes the whole of the Northern Territory and the Kimberleys region down to Broome. That is a tremendous slice of Australia. The sort of job which the Tribunal does is one for which I have a great deal of admiration. On the figures provided by the Department, in 1987-88, of the total number of recommendations made by the Appeals Tribunal in the Northern Territory, 96.67 per cent were accepted by the Department. I believe that that demonstrates the way in which the Department and the Social Security Appeals Tribunal have been working in northern Australia. I commend both the Department and the Tribunal for that. In terms of looking at the problems which confront the delivery of social security in northern Australia and the welfare of the northern Australian population, some things need to be pointed out. For the benefit of those people who are unaware of the types of problems that are confronted by the Department of Social Security-and, indeed, by other government departments in administering to clients throughout northern Australia-a number of things need to be taken into account, not the least of which is the weather patterns during the year. On some occasions during the year some communities are completely inaccessible, at other times of the year, in terms of demography, there is a great deal of movement in and around the Northern Territory and, indeed, the north of Western Australia, South Australia, and also western Queensland, as a result of Aboriginal people moving because of ceremonial and familial obligations. This requires a flexible approach to the administration of social security, which, I am happy to say, has been taken up by the Department and the Minister. In terms of the delivery of service by the Social Security Appeals Tribunal, in the past it has often been the case that it has been most cost effective to have a stockpile of cases to justify the costs of travel from one place to another. Indeed, another problem which confronts the administration of the social security system in northern Australia is the question of invalid pensioners. It is often very difficult, because of the nature of the area, to get specialist medical opinion. I would like the House to appreciate that if a person lives, say, at Borroloola, which is on the eastern side of the Northern Territory on the Gulf of Carpentaria, and needs specialist attention, that person's closest town is Darwin. In some cases travel may also be required to other States, perhaps to Adelaide or Brisbane. It is important to recognise that these difficulties confront not only the clients who are the recipients of the social welfare system in the Northern Territory and northern Australia generally, but also the administration undertaken by the Department. There are also specific cultural and demographic factors which I have already mentioned which are peculiar to the north and which often result in appeals that are very peculiar to the region. Cases which have come before the Social Security Appeals Tribunal in the past highlight the problems of service delivery to an area which is characterised, as I have said, by isolation and a population mix which includes a high migrant population. I believe that the number of different ethnic groups totals about 95, with 26 per cent of the population being Aboriginals. A large itinerant work force moves to the area mostly in the dry season to take advantage of the very nice climate which we experience and, indeed, also to take advantage of the job opportunities that have been provided in the mining sector and other resource-based industries. A number of policy issues were raised in the 1986-87 annual report of the Social Security Appeals Tribunal. I would like to mention them to the House this evening. They also reflect the nature of the delivery of social security in northern Australia and the problems which the Department has confronted in the administration of its service. Firstly, there is the question of Aboriginal law versus European law in the case of an Aboriginal person having two under-age wives. Secondly, there is the question of family allowance payments for children residing overseas. I refer, for example, to mixed marriages, such as those in which spouses come from the Philippines and Malaysia. Thirdly, there is the question of what constitutes `special circumstances' in the last lodgment of unemployment benefit income forms-the SU19B-especially in remote areas. They are significant problems. I would like to mention a number of specific cases. The first is the situation of a polygamous Aboriginal marriage in which the second wife was in receipt of the unemployment benefit. This woman was not able to get supporting benefits. The woman had automatically been placed on the unemployment benefit and was in hospital waiting to give birth to another child. As she could not then fulfil the work test, she was taken off the unemployment benefit. The recommendation of the Social Security Appeals Tribunal was to provide the woman with special benefits-a most appropriate course of action. A second example is that the Top End of Australia experiences a huge wave of itinerants, as I have already mentioned, who travel north in the dry season looking for work. It is now a matter of policy that when a person who fits into this category registers for benefits, he is issued with a work effort certificate which has to be signed by two prospective employers every two weeks. In remote communities, one person often acts as an agent to certify the eligibility criteria of everyone living in that area. In a case in which a recipient has been judged to have been overpaid, the legal issue has arisen as to who is responsible: is it the recipient or the person who signs on behalf of the recipient? Another case that I mention is that of an Aboriginal man who has three under-age wives and several children. This man was employed under the community development employment program, a very important and most worthwhile program which this Government has increased quite significantly. I must say that it was introduced by Dame Margaret Guilfoyle under the Fraser Administration. After successfully appealing to the Social Security Appeals Tribunal, the family is now in receipt of the family allowance and the family allowance supplement, as it should have been in the first instance. The northern area Social Security Appeals Tribunal is the only Tribunal which advocates, because of the large Aboriginal population, which often has English as a second language and quite diverse cultural expectations, a radical approach to the way in which it deals with clients. I am happy to say that the Department has taken up that challenge. Indeed, as I have mentioned in the House previously, the Department has introduced a very positive program. It has developed and introduced into the administration of social security in northern Australia the North Australian Development Unit. I would like to remind the House of the functions of that Unit to demonstrate the way in which the Minister has fulfilled his responsibilities in providing fair and equitable service for all of his Department's clients, wherever they might be, whatever their race, and whatever their background. The North Australian Development Unit is based in Darwin and has as its primary purpose the development of policies and strategies to improve the applicability and delivery of departmental programs and services to people living in northern Australia. The Unit's activities will not be limited to the Northern Territory, but will also span the Pilbara and the Kimberleys in Western Australia and north-western and north Queensland. In that way it reflects most of the area that is already covered by the Social Security Appeals Tribunal based in Darwin. The Unit has three main areas of responsibility: the development of ideas relating to the provision and improvement of departmental services in remote areas; the development of policy on matters specifically related to Aboriginal clients; and the development of policy on matters relating to other groups of clients more commonly found in remote Australia-isolated outback communities and itinerants. I think that that is an important admission by the Department-that it needs to pay special attention to the very great needs of these people. The North Australian Development Unit will need to address a number of policy issues, one of which I have already mentioned-that is, appropriate policy relating to the findings of the Australian Law Reform Commission in the area of Aboriginal traditional law and culture. Specific issues include, as I have already said, polygamous marriages, changes in child custody, under-age marriages, and others. There is also the question of the definition of unemployment. There is a need to clarify the application of the work test under section 116 of the Act to client groups within the northern area. These matters have already been recognised by the Department. They have also been thrown up by the Appeals Tribunal mechanism. As I say, the Minister is to be commended for recognising his responsibilities in this area. Some of the advantages in establishing the Unit will be the achievement of one consolidated view and a consistent approach to remote area issues, thus gaining outcomes and approaches across the three administrations-that is, in the north-west of Western Australia, the Northern Territory and Queensland-which have often been at variance with one another. The Unit will provide greater opportunities to assemble departmental experts in a concentrated way to achieve solutions to remote area problems quickly, and will provide better targeting or prioritising of departmental service delivery activities in remote areas. In addition, there will be better long term planning to achieve solutions to current problems facing the Department in the delivery of services to remote areas, and, lastly, development opportunities provided for staff to work in remote localities and later to apply this knowledge to other operations within the Department. In the choice of staff that the Department has operating in these areas, I would like to say that they are carrying out their functions extremely well. They have a high level of acceptance within the community. As I have said previously, they are to be applauded for their application to their tasks and the way in which they have genuinely tried to overcome the particular problems that confront social security clients in northern Australia. Finally, I refer the House to the cost savings that this particular measure will bring about. I am sure the honourable member for Bradfield (Mr Connolly) would applaud this, knowing his interest in public administration and his concern for the public purse. I understand cost savings which this will involve are about $5.4m. I believe that shows the Minister has adopted a very cost-effective and a cost-efficient approach to the administration of his portfolio. The Government has taken a number of significant steps towards a policy at administrative level to address the special needs of people throughout the social security system in Australia, of which this legislation is a fundamental part. I commend the legislation to the House. Mr HOWE(Batman-Minister for Social Security)(9.12) —I thank honourable members who have contributed to the debate, particularly from my side of the House, the members for Phillip (Ms McHugh), Cowan (Mrs Jakobsen) and the Northern Territory (Mr Snowdon). I think everyone who contributed to the debate referred to certain cases, certain situations, particularly the honourable member for the Northern Territory, who pointed to an extremely important area of Aboriginal custom and tradition and the difficulties of applying this Act to the real life situation of Aboriginal people in those remote areas of Australia. I assure the honourable member that the Northern Development Unit to which he referred is specifically being established to try to reverse the process, as it were, of the initiative in terms of legislation. Very often we draft our policy and our approach to legislation in Canberra and then consider the implications for people around Australia. In this case, we are trying to look at some of the issues, some of the policy questions, within that remote area context, particularly focusing on the needs of Aboriginal people, so that we can begin to frame at least the policy questions and perhaps policy initiatives from that situation. I have certainly got great expectations of the unit. It is really only now being formally established, with staff being appointed, but in the next 12 months I am expecting to see a significant output. The honourable member for Cowan referred to one of those very difficult cases that are not unknown in other parts of Australia. I appreciate very much the comments she made. I think we see the value but also the limitations of the appeals processes when we take cases such as the one referred to. It is important that we get it right in these areas, and I think that the changes to which the honourable member referred are somewhat fairer than the situation that existed earlier. Of course, in social security one is always trying to apply the general rule and the law to a great myriad of individual circumstances, and it is extremely difficult to legislate in social security in such a way as to take account of all the circumstances that one needs to consider. Very often we find that we need the discretion that itself creates problems. The balance between good law and legislation and the need to preserve some discretion is one of the very difficult tensions in social security. I very much appreciated the contribution from the honourable member for Bradfield (Mr Connolly) and I acknowledge his expertise in this area, although I will have to disagree to some extent with his judgment. I have to say that although the honourable member for Bradfield likes to plead amnesia from time to time, the fact is that the previous Government left this country in a terrible mess and that was reflected perhaps more in the area of social security than anywhere else. When one fails to achieve proper management of an economy and one realises the levels of dependency of people of work-force age who were the legacy of the Fraser-Howard Government in 1982-83, that does put enormous pressure on any administrative system. In 1983 the Department of Social Security was struggling to cope with the massive numbers of people who had come into that system, particularly people on various kinds of benefits, principally unemployment benefits. That situation is perfectly understandable but it resulted in an administrative situation in which many of the proper controls and checks and balances within the social security system were simply relaxed and there was no really fair, effective and efficient administration. A number of people have referred to this leaflet that was put out with the Budget kit on administrative and policy reform, 1983-1988. Any study of the outline of change would recognise that this Government has given the highest possible priority to administrative reform within the Department of Social Security. There has been a great deal of policy change but along with policy change there has also been very significant administrative reform. We have sought not only to review policy through the social security review but also to bring our legislation into line with policy with some major reforms of areas of the social security system in terms of the legislation. I would have to say that the sheer rate of change in our period in government has itself represented something of a challenge to the regional officers in the Department of Social Security. I want to put on record how impressed I have been with the work that has been done by the Social Security Department in managing this rate of change, which has been necessary to achieve a more efficient and a fairer social security system. In the hundreds of offices around the country, I am always impressed with the quality of commitment of members of staff. They may be, as the honourable member for Bradfield suggested, mere class 5s, sometimes making important decisions, but nevertheless, they are highly committed to the task of being public servants responsible to administer legislation fairly and ensure that we have a system which runs with some integrity. Perhaps some of the increase referred to by the honourable member for Bradfield in the number of appeals rejected by the Department-although I do not believe it has been as dramatic as he suggested-reflects in a sense the difficulty which the appeals tribunals themselves have had in getting on top of the change. We are talking about less than 15 per cent of appeals being overturned by the Department, not the much higher figure mentioned by the honourable member. Nevertheless, I would be the first to concede that there have been a greater number of rejections by the Department and I think that reflects in some respects the rate of change that has occurred in legislation, policy and tighter administration in the past two or three years. The most important issue that was raised by the honourable member was the question to two-tier appeals. Perhaps the reasons for that go back to the fact that that was what was recommended by the Administrative Review Council (ARC). I gave a great deal of thought to the question of decision making powers for the Social Security Appeals Tribunal as was recommended at that time. The reason we did not move quickly there-and I think this is very much the point that the honourable member for Bradfield raised in his scathing criticism of the Administrative Appeals Tribunal (AAT)-was our concern about excessive legalism. We wanted to improve the administration of the Social Security Appeals Tribunal before taking that step to ensure that it was operating in a fully responsible way. We moved to appoint the principal members in various States and to take up most of the other recommendations of the ARC, leaving aside that particular question. The people currently associated with the Social Security Appeals Tribunal are convinced that, as a result of getting decision making powers, there will not need to be excessive formality. By the same token, one recognises that there are various degrees of complexity of decisions that have to be made on questions of law. Of course we are talking about a situation whereby the Social Security Appeals Tribunal, as the honourable member for Bradfield rightly said, was dealing with a very large number of cases each year-something of the order of 12,000-whereas the Administrative Appeals Tribunal heard a relatively small number of social security cases. There is no doubt that at the AAT level one is talking about a much greater expense per appeal. Within the context of our budgetary policy we are concerned about that particular issue, though I would not put too much weight on it. My prime concern in terms of structure is to ensure that the Social Security Appeals Tribunal continues to operate in a way that is sympathetic to the situation of the client and that it is not run in a legalistic way or as a court of law. I am concerned that it should be run so that people can meet and in a considered way can consider the circumstances that are in front of them, over and against the law. I am not at all convinced that that circumstance would apply in the context of the AAT as it is currently constituted-and I recognise that that is not what the honourable member for Bradfield was arguing-but I am convinced that at least for the time being it is important to provide for the possibility of appeal in cases where there is contention on the part of either the client or the Department and where there is a difficult or complex legal issue which needs to be resolved. Those were the principal issues raised by the honourable member. I regard this legislation as significant. It is perhaps the first significant element in the task of rewriting our social security legislation. The honourable member will know that that is the challenge we are taking on as we move towards the end of the period of the social security review. While I cannot guarantee that all our legislation in the next few months will contribute significantly to that objective, I think this piece of legislation has a great deal of clarity. It not only sorts out the position of appeals tribunal but also clarifies the whole review system of the Department, the powers of the Secretary, the requirement of guidelines to be tabled and so on. The whole range of issues that are relevant in the review process are sorted out in a very clear way and it is a fine piece of legislation. Amendment negatived. Original question resolved in the affirmative. Bill read a second time. Message from the Governor-General recommending appropriation announced. Leave granted for third reading to be moved forthwith. Bill (on motion by Mr Howe) read a third time. Debate resumed from 28 September, on motion by Mr Willis: That the Bill be now read a second time. Mr BLUNT(Richmond)(9.29) —Qantas Airways Ltd is a prisoner of the Australian Labor Party (ALP) factions-it is a hostage of the left wing, and I am pleased that we have two members of the Left here at the table tonight-and it is a victim of the Government's policy paralysis. If that were not all true we would not have the Qantas Airways Limited (Loan Guarantee) Bill in the House tonight. I begin by saying that the Opposition has no problems whatsoever with this Bill and does not oppose it. But the Bill is unnecessary. If the Government did what it should be doing and what everybody knows it should be doing there would be no need for the Commonwealth Government to provide a loan guarantee for Qantas Airways. Qantas would in fact be a listed public company and it would be borrowing money like every other company. Gerry, if you want to tell us about the Aboriginal and Torres Strait Islander Commission then I am happy to listen to you. But if you want to participate in this debate, you should go and see the Whip, put your name on the speakers list, and come in here and talk. Mr Howe —Mr Deputy Speaker, I rise on a point of order. I think we have had a number of gratuitous comments. The honourable member should refer to other members by their proper titles and he should address himself to the Bill rather than irrelevancies. Mr DEPUTY SPEAKER(Mr Blanchard) —There have been gratuitous comments from both sides of the House. The honourable member for Richmond will address the Chair. Mr BLUNT —I am more than happy to acknowledge that the Minister, in taking what I thought was a frivolous point of order, has in fact learnt that one should refer to people by their appropriate names in this House, which is a lesson that I might have taught him at some stage. As for the Minister for Aboriginal Affairs (Mr Hand), I think he had better consult with his left wing colleague and see how they are going to handle the emerging leadership challenge within the Australian Labor Party when the Treasurer (Mr Keating) returns. Mr Hand —Mr Deputy Speaker, I rise on a point of order. There is a particular Bill before the House. It might be in the interests of everybody if the honourable member, even though he admits that it is not necessary, gets on with whatever he has to say about the Bill. Mr DEPUTY SPEAKER —There is no point of order. The honourable member for Richmond will resume. Mr Howe —How much time have you to fill in? Mr BLUNT —Actually, I have quite a lot to say tonight. That is why the Opposition is moving an amendment. It will allow us to address some of the inadequacies of this Government. I move: That all words after `That' be omitted with a view to substituting the following words: `whilst not declining to give the Bill a second reading, the House- (1) regrets that Qantas has been prevented from selling shares to Qantas employees and the Australian people to provide a capital increase to facilitate expansion of the airline to cope with increasing passengers and freight; and (2) notes that the Australian Taxation Office has issued a statement on debt defeasance, a procedure adopted by Qantas to finance the acquisition of new aircraft'. We will now debate some of the more inadequate aspects of this Government's performance. As I said, this Bill is totally unnecessary because if Qantas were in fact a publicly listed company it would not need a Government guarantee to borrow the money that it needs. The Opposition laments the situation that the Government is cluttering this House with legislation which could be made redundant if it had the courage of its convictions to go on and do what is necessary. But, of course, we have this policy paralysis arising from the national convention. The Australian Labor Party (ALP) has set up a committee to see what it could do about Qantas. We really come down to the crux of the matter that Qantas is in fact a good airline. It is doing a great job for Australia. This current Labor Government is not a good government and it is not doing a good job for Australia. It is not doing the right thing by Qantas. I find it amazing that any government would have the temerity to set up a committee at a Labor Party convention and put on the back burner an urgent and pressing economic decision, that is, what the future is for our national carrier. The members on the government benches have suddenly gone very quiet because they know that that is in fact the problem. They are not game to address what is a major problem in our country simply because they cannot achieve agreement within their own factions. As I said, Qantas has become a prisoner of the factions and a hostage of the left wing. The reason we want to debate the need for Qantas to cease becoming wholly owned by the Commonwealth Government and for shares to be sold to its employees and to the Australian public is that air traffic into Australia is growing dramatically. Qantas, if it is to maintain its share of that growing air traffic-it is in the interests of all Australians for it to do so-must expand. At the present time we have about 2.25 million tourists coming to Australia each year. Qantas has about 43 per cent of that traffic. By the year 2000 a conservative estimate is that we will have about 5 million tourists coming to this country. It will probably be considerably more. If Qantas is to maintain its market share and its earnings for Australia it will need to grow, and to grow it will need to spend a lot of money. In this House yesterday, I mentioned that Qantas was looking to spend $5 billion. I was corrected by the Minister for Transport and Communications (Mr Willis). I welcome his correction. He said I was wrong. It is not $5 billion; it is $6 billion. This simply adds emphasis to the point that I will make later tonight. Someone has to address the question of where the money is coming from and what the financing proposals will be. Qantas currently runs a fleet of about 34 aircraft. It has 25 Boeing 747 and 9 Boeing 767 aircraft. But by 1992, which is only four years away, Qantas wants a fleet of 52 aircraft-37 Boeing 747 and 15 Boeing 767 aircraft. They are very expensive. This Bill that we are debating here tonight is a Bill for the purchase of a relatively few Boeing 767s. The amount of money that this Bill deals with is $250m. It is a lot of money; aircraft are very expensive. To take the Qantas fleet from 34 to 52 will take a lot more than $250 million. It will take of the order of $6 billion. The problem is that Qantas does not have sufficient capital to justify borrowing that amount of money because this is what this Bill does: it is a loan guarantee Bill and Qantas is borrowing. It could continue to borrow. What would happen is that its interest repayments would become a greater proportion of its obligation. We could go back to the situation in which the annual interest payments for Qantas exceeded its paid up capital. That is not a desirable situation. That was the situation that existed not so long ago. In prudent commercial terms it should not move in that direction. Qantas itself acknowledges that it needs between $400m and $600m in order to put it on a reasonable commercial basis. The Government knows that it cannot afford to put that amount of money into Qantas. It also knows the cost that the Australian community will bear if Qantas does not maintain its relative size in the international market and maintain its market share. We only have to look at what is happening to the United States carriers and other carriers around the world. There is aggregation and they are growing. The growth in air traffic in our region, into Australia, because of the growth in our tourist industry is significant. There is a need for Qantas to maintain that market share in our national interest. It is in our national interest for Qantas to grow. That is why this Government is culpable for not addressing the Qantas problem. The Government is made doubly culpable not because it cannot address the mechanism but because it is not game to address it as a result of dissension within its factions. Mr McGauran —What happened to the micro-reforms? Mr BLUNT —As my effective colleague the shadow Minister for science and energy, the honourable member for Gippsland (Mr McGauran), has pointed out-he is well aware of the significance of Qantas and technology to this country-there is a need for this problem to be addressed. It really comes down to how we are going to pay for it. This Government, obviously because it is too hard to come to some sort of compromise or deal within the factions, is going to keep borrowing money. It is commercially not a very good idea. Qantas knows it is not a very good idea. Of course, what the Government really should be doing is floating shares in Qantas right now. As the Minister for Aboriginal Affairs was about to interject, I will explain to him why now is a very good time to act. Qantas is trading very well at the moment. Tourism is very buoyant and profitability is there. It would be possible to sell shares in Qantas at a premium at present and reduce the cost into the future of raising the capital which would put Qantas on a far better financial base. It would reduce its gearing and reduce the obligations of the Commonwealth Government. It would allow the airline to expand, the way other airlines are expanding, and it would provide a greater earnings capacity for Australia. Qantas has the capacity to become one of the great international companies of Australia. It is a company which is capable of earning vast quantities of foreign exchange. Everybody in this chamber knows that we need a lot of foreign exchange because I do not think the Treasurer's predictions for the balance of payments will come off. They seem to be way off at present. We will have a continuing problem into the foreseeable future. Every opportunity that we can get to earn foreign exchange should be grasped with both hands. We certainly cannot afford to push it off simply because it is a bit awkward for the ALP. This country is bigger than the ALP. This country is about all the people who live here. If it is going to cause a bit of heartache for a few of the factional bosses within the ALP that is tough. Mr McGauran —Ideological loonies. Mr BLUNT —Ideological loonies is right. What is more important to this country in the long term-the success of Qantas or a bit of factional peace within the ALP? I know what the average Australian thinks. He wants our airline to grow and to prosper and he wants to gain the benefits that come from that. He would not be worried if the Minister for the Arts, Sport, the Environment, Tourism and Territories (Senator Richardson) or the Minister for Immigration, Local Government and Ethnic Affairs (Senator Robert Ray) had to knock a few heads together. They are there to get the job done, to govern in the interests of Australia, not the ALP factions. The ALP cannot really come to grips with this issue without tearing itself apart. It has problems, as we know. The Treasurer will return to the country very soon and the Acting Treasurer, the Minister for Employment, Education and Training (Mr Dawkins), will probably greet him at the airport and tell him about all the questions that he could not answer and ask what he should have said. They will then probably jointly go to the Prime Minister (Mr Hawke) and say, `We both have the same opinion as to your future'. I read about that in the newspaper today. I think it is a very good idea, too. I think the Prime Minister should retire. The terminal decay which has set in in the Labor Party could then run riot. Another issue is raised by this Bill which I think members of this House will be interested to hear about, and I am sure that the public also will be interested to hear about it. It highlights the inadequacy of the second reading speech that the Minister made when he introduced this Bill because it does not cover this issue at all. There is something fundamentally wrong with a government that is not prepared to talk in detail about the financing arrangements of a company that it owns 100 per cent. I do not mind Qantas doing what it is doing, provided it is legal and above board; but I think it is shameful that the Government is not prepared to talk about it. The issue I want to talk about is the second aspect of my amendment; that is, debt defeasance. Let me read briefly from an article that appeared in a newspaper not so long ago. It was a very interesting article. I think it raises at least questions as to why the Minister, in introducing this Bill, did not explain fully what the financing arrangements were. From reading the second reading speech of the Minister, one would think that it was about a straightforward loan guarantee Bill whereby Qantas will borrow some money, take it across to the Boeing aircraft company and get the aircraft. That is what one would think from reading the speech. But, of course, it is a long way from that. Let me explain how this works by quoting from the article written by Tom Ballantyne. The article states: The aircraft purchase began simply, with Qantas ordering four new 767-300 extended-range passenger jets from the huge Boeing aircraft company in Seattle. That is in the United States of America. The article continues: The places are to be delivered in September, October, November and December. They will enter service with Qantas named after the cities of Whyalla, Bendigo, Kalgoorlie and Maitland. But before the aircraft touch down in Australia, Qantas will sell the planes to Japan, using Sydney lease-management company Babcock and Brown, which has previously handled similar deals for the airline. They are dealing in Japan with an affiliate company, Namura Babcock and Brown . . . which will set up separate lease companies for each of the four new aircraft. On paper, NBB pays Qantas for the planes by raising 80 per cent of the money from Barclays Bank in Japan. The remaining 20 per cent comes in as equity capital from Japanese investors. The jets with the flying kangaroo on the tail are now officially Japanese, and thus qualify the new owners for tax benefits and depreciation under Japanese tax laws. According to Qantas director Mr Max Haworth, the Japanese will then share the profit with Qantas. The NBB will then in effect sell the aircraft back to Qantas, but not directly. The Japanese will issue Qantas with a lease and an option to buy the planes on hire purchase through Barclays International Leasing in the Dutch Antilles, a small island group in the Caribbean. Qantas will then buy the planes back through Barclays. To this chain of entities we add the Barclays branch in the Cayman Islands, also in the Caribbean. The article continues: Qantas pays the bank a fee to defease- which means to do away with- the rental obligations and part of the purchase option (. . . an accounting technique which cancels repayments on the loan principal). The planes, bought back on hire purchase, will then become Australian again, qualifying Qantas for tax benefits and depreciation under Australian tax rules. It is a very complex financing arrangement. There is no reference to it whatsoever in the Bill. I do not have any problem with Qantas doing so, provided it is legal. In fact, if every other airline in the world is doing it, Qantas has to do it to compete. Let us face it, we are out there in the world economy. We are competing, as the Treasurer constantly tells us, and we cannot afford to tie one hand behind the back of Qantas if it has to compete with United Airlines, Continental Airlines, Japan Airlines, Lufthansa or any other international airline that probably uses the same fairly sophisticated financing techniques. I am told that the Australian Taxation Office believes that there are many 747s flying around the world courtesy of tax arrangements. Mr McGauran —It is a bit like Bill Hayden. Mr BLUNT —No, Bill is not flying courtesy of tax arrangements. Mr McGauran —No, but courtesy of the taxpayers. Mr BLUNT —Courtesy of the taxpayers. He just has his snout in the trough. Let me get back to the fundamental issue of debt defeasance, which I think the Minister should address. Why is the Government not prepared to make a statement about debt defeasance when it brings in a loan guarantee Bill? The Government knows exactly what the financing arrangements for Qantas are but it makes no reference to them. I would like to draw the attention of the Minister to a tax ruling headed `Income Tax Debt Defeasance Liability Assumption'. The date of the ruling was 15 September 1988 and the time of effect was immediate. I expect the Minister, when he sums up this debate, to make a comment about the financing arrangements of Qantas in terms of this tax ruling. If this Government is to provide loan guarantees for this financing arrangement, the Parliament deserves to know exactly how the financing of these aircraft will be undertaken and what relationship it has, if any, to this tax ruling issued recently by the Australian Commissioner of Taxation. In conclusion, it is deplorable and lamentable that this Government is not prepared to address the real issues. Instead, the Minister comes into this chamber with a superficial second reading speech that talks briefly about scheduling increases and bringing forward the delivery of aircraft when the Bill is about appropriating about $250m and involves a very complex financing arrangement. If the Government wants the Parliament to vote on this legislation it ought to tell the Parliament what is involved in it. Mr DEPUTY SPEAKER(Mr Ruddock) —Is the amendment seconded? Mr McGauran —I second the amendment. Mr MARTIN(Macarthur)(9.49) —In the course of the contribution of the shadow Minister for transport and aviation, the honourable member for Richmond (Mr Blunt), we seem to have travelled all round the world. I suppose that is fairly appropriate, given the context of the legislation that we are debating tonight. I would like to bring the attention of the House back to the Qantas Airways Limited (Loan Guarantee) Bill, but I would also like to make some comments on the points that the shadow Minister raised because I have also seen the newspaper article entitled `You own the airline, Japanese own the Jumbos', written by Tom Ballantyne, which the shadow Minister read into Hansard in the course of his delivery tonight. I will make some comments about that a little later. The Bill actually authorises the Treasurer (Mr Keating), on behalf of the Commonwealth, to guarantee borrowings raised by Qantas Airways Ltd to finance the purchase of three Boeing 767-300 extended range aircraft. As has been pointed out, they will be delivered in October, November and December of this year. They will provide Qantas with greater flexibility in meeting the requirements of the rapidly growing inbound tourist market. They will be used primarily on the Tasman and Japanese routes, two of Qantas's and Australia's important markets. That, I think, raises an interesting issue about the tourist industry in this country and the source of our tourists. If honourable members take the opportunity to look in Qantas's annual report of 1986-87 and at its interim results of 1987-88 they will find the statistics thrown up quite interesting. For example, in January to July 1987 the number of tourists coming into this country was estimated at 106,200. In 1988 for the same period that number has jumped to 188,300, a 77 per cent increase. That is on the Japanese route. On the New Zealand, or Tasman, route 230,100 came in that six-month period, January to July 1987, but that number increased to 286,300 in the same period in 1988, which represents a 24 per cent increase. It is a fact that New Zealand is the largest single source of inbound tourists to Australia. They account for something like 17 per cent of all international arrivals. The Japanese on the other hand at present account for something like 13 per cent of the total arrivals, but this particular segment of Australia's tourist market is growing at the highest rate. The Bureau of Tourism Research has projected that by 1990 the number of tourists coming from New Zealand on the Tasman route will increase to 446,000, which is about 16 per cent of the total number of tourists coming into this country. For the Japanese tourists that number will increase to 465,000, which represents about 17 per cent of our total intake. Other Asian countries will also provide a considerable number of tourists to Australia and that number is growing at the rate of 26 per cent per annum. They are interesting statistics because they reinforce Qantas's position in deciding to buy these sorts of aircraft and to place them on the Tasman route and the Japanese route. It is also important, in view of the contribution made by the honourable member for Richmond, to talk about the success of Qantas. Again, if honourable members look at some of the statistics that are available they will find it very interesting to reflect upon what has happened to Australia's national carrier since the Hawke Government has been responsible in a direct sense for Qantas and to compare those statistics with the position, in an operating sense, under the former Government. If honourable members look at the past seven years of operations, which is quite a reasonable measure by anyone's standard, they will see that in 1982 Qantas made a loss of approximately $220m. In 1983 it made a loss of $47m. However, in 1984, with a change of government, amazingly it made a profit of $58m. It went from a loss of $47m in 1983 to a profit of $58m in 1984. In 1985 the profit was $62m. In 1986 it fell back to $44m, nevertheless it was still a profit. In 1987 it was $104m, and in 1988 it is projected to be $150m on the interim results that have been put forward. That profit between 1987 and 1988 represents a 47 per cent increase in profit margins on its operations. We heard the honourable member for Richmond say that this is an airline that is in desperate need of a cash injection, that is in desperate need of being put out into the public domain, that is desperately searching for an identity. He said that it is an operation that could become one of the greatest airlines of the world if only it were given a free hand by the Government. In response to those comments, for Qantas to be taken from a $20m loss in operations in 1982 to a $150m profit in prospect in 1988-89 to me does not sound as though it is doing all that badly. We also have to take into consideration the comments made by the honourable member for Richmond about the need for Qantas to continue its growth, to aggregate and to do all the sorts of things that he said carriers in the US were doing where aggregation has taken place. Following deregulation, which some people saw as being the panacea for introducing lower fares, more regular services, and all the rest of it, certainly in the initial phases more airline companies operated-many of them fly-by-nighters-but they have now gone out of business or they have been swallowed up by the larger carriers. So US Air, Continental, et cetera, are buying out smaller airline operations and expanding their networks. The honourable member for Richmond made quite a bit of that and suggested that that is what Qantas should do. He suggested that it should get bigger and become a major airline in this region. I remind the honourable member that that is exactly what Qantas is endeavouring to do. It is, as all honourable members would know, the preferred tenderer in a 25 per cent purchase of Air New Zealand. As I understand it, the Government of New Zealand is presently deliberating upon that very fact: should Qantas, an Australian airline, be permitted to purchase 25 per cent of Air New Zealand? The honourable member for Richmond says that Qantas was starved for cash, starved for capital, and there is a need to turn it out into the public sector where people, either within the company or the general public, can purchase shares. I suppose that the honourable member for Richmond in moving the amendment which states that `the House . . . regrets that Qantas has been prevented from selling shares to Qantas employees and the Australian people' probably has in mind some of the schemes which presently operate in the United States where companies in trouble sell shares to their own employees and operate a very complex relationship with those employees. When certain profit levels are reached dividends have to be paid to their employees. There is nothing wrong with that. It sounds like a pretty good sort of a scheme. But there is also in some cases in the United States-and I am thinking particularly of some of the steel mills in that country-a second part of the agreement which says that once the employees purchase those shares and the shares reach a certain profit level in the company, the company is obligated to buy those shares back. One company in the United States of which I am aware, Wierton Steel in Pittsburgh, has reached the magic profit margin. Half of it has to be spent on providing dividends to the shareholders, being the employees, and the other half has gone out because the shareholders, the employees, have decided they want to cash out their shares. So the whole of the profit is gone and the steel company, which needs to upgrade its facilities, has absolutely nothing. How does it compete? The honourable member for Richmond should take that into consideration when he decides to move an amendment of this nature. I would also like to refer to some comments the honourable member for Richmond made when talking about a newspaper article written by Tom Ballantyne. The honourable member asked the Minister for Transport and Communications (Mr Willis) when summing up this debate to investigate the methodology by which the aircraft were purchased by Qantas. He detailed-in fact he read into the Hansard-the article. Mr Hand —That's all he said. He read the newspaper article. It was a pretty long speech. Mr MARTIN —It was all he had to say. It was a pretty poor speech. However, he did read the article well into the Hansard. Mr Hand —I'd give him two out of 10 for the speech. Mr MARTIN —I would give him 2 1/2. Some questions have been raised about the use of tax havens in that arrangement. The Cayman Islands is one and the Dutch Antilles is another. Questions have been raised about the methodology of leasing, about who owns the jets in the first instance and about whether there is some legal or moral question of taxation liabilities. Let me say to the honourable member for Richmond that this issue is presently being reviewed by the House of Representatives Standing Committee on Finance and Public Administration in its review of international profit shifting. One would hope that some light will be shed on it when the report is finally tabled in this Parliament later this year. It is interesting that the Australian Taxation Office has handed down a ruling on the tax issues associated with the leasing and purchasing arrangement, complex as it is, associated with the purchase of these aircraft. Every manoeuvre that has been employed has been legal under the taxation regimes of both Japan and Australia-totally, unequivocally legal. There has been no problem with any of those operations. The fact that banks in tax havens may have been used, I believe, is worthy of some consideration. Nevertheless, there is nothing illegal about what has happened. There is a benefit to Australia in getting aircraft at a much reduced cost. Obviously, any organisation would attempt to do so. As I have indicated, the question of that tax ruling is one that will be pursued. As I have also indicated, the question of tax havens and their use in this instance is worthy of pursuit and that is being done through the Committee I am involved with. I suggest to those people involved in this debate tonight that it is most important that Qantas be supported in its endeavours to provide opportunities for further income to come to this country because of the number of seats it can sell on its aircraft. We have seen examples of that. The company plans to operate 154 extra round trips this summer to accommodate the anticipated higher demand, basically through the use of these aircraft. It is also going to lease other aircraft. Qantas, our premier flag carrier, our international airline, has to be supported in those endeavours. The new schedules will take effect in November, which reflects an increase each week of about 6,700 seats, or an equivalent of 17 jumbo jets compared with last summer's schedules. Qantas would not be doing it if the demand was not there. Rather than coming in here and suggesting that there is a debate on privatisation that is impeding Qantas, one has only to look at the reports I have quoted and the financial figures I have cited and at the increase in traffic. Again I refer honourable members to the annual report of 1986-87 and the table which appears on page 2. The number of kilometres flown in 1987 was 92,291,000 compared to 1986, when it was only 76,546,000-an increase of 20.6 per cent. In 1987 over 3 million passengers were carried compared to only 2.5m in 1986, a 16.8 per cent increase. Those statistics are here for everyone to see. Qantas is operating effectively. It is operating efficiently. Considerations about capital injection are necessary to enable Qantas to reduce its debt to equity ratio, but those issues are under consideration by the Government. This is a Bill worthy of support. It is simple. It is not complicated, as was suggested by the honourable member for Richmond. It does not beg the question about problems associated with who owns it and who provides the capital and so on. As I have indicated, more than adequate evidence is there to suggest that the company is operating extremely well, thank you very much. The issues of the taxation rulings and the purchasing arrangements have benefited Australia. In a pure legal sense they have been proven to be totally legal and totally above board. I reject the amendment that has been moved. I am sure that the honourable member for Richmond was not really serious when he chose to put it forward-nor does he expect it to get up. Mr MOORE(Ryan)(10.05) —The Opposition supports the amendment. In doing so, I draw a couple of matters to the attention of the House. I doubt whether there would be any honourable member who would not have used Qantas Airways Ltd in some respect in the last few years. They would have found its services, particularly its in-flight services, very competitive and of a very high standard compared with those of the rest of the international carriers. There is some considerable difference these days in the quality of service provided. However, I must immediately diverge to the realities of life and pick up the last annual report of Qantas-a wholly owned government enterprise. Looking at its accounts, I immediately see a company that is vastly under-capitalised. The Minister for Transport and Communications (Mr Willis) would recognise that. Anybody in the chamber would recognise that. This operation has fixed assets-outlined in its balance sheet; these are the latest accounts, to the end of 1987-of a total value of $2 billion on an authorised and paid up capital of $149m. Any clown could tell you that that is not on. It is just not a rating value. Any member of the Labor Party backbench could tell you that. They cannot tell us we should privatise Qantas because that goes against the socialism at the heart of the Labor Party. The Government starves a major competitor in an industry which requires millions of dollars every year to be able to compete. The Government does not seem to be able to understand where the money comes from. It owns all the shares and it expects the company to pay taxation and a dividend. As I said, Qantas has an authorised paid up capital of $149m and total assets of $2 billion. I quote from its balance sheet. It says that loan drawings raised $237m through a Euro commercial paper program to assist in the finance of aircraft. Increased creditors and deferred revenue towards sales contributed a further $79m. Funds outflowed included payments of $125m-I am rounding the figures-as deposit and progress payments on additional aircraft and related equipment and $108m paid on other fixed assets, equipment and investments. Loan repayments during the year required $62m. The Government required a dividend of $14.9m. Increases in current assets totalled $506m, including cash at bank, in hand and on deposit. We are not talking about a peanut show. We are talking in very large figures-against a paid up capital that the Government owns of $149m. It is a total disgrace. No wonder the Chairman of Qantas, Jim Leslie, says that Qantas needs an immediate injection of $300m for starters. I am not surprised. The Government is drawing from it a dividend of $14.9m. The tax payment for the year is $50m. I find it quite extraordinary. It is no wonder that this company is forced to lease its aircraft. These lease arrangements are of a sophisticated nature. They involve offshore registration and offshore funding, all of which have high taxation significance. The Commissioner of Taxation says, `Do not worry about the law. It is what you think the law means, what the intention is'. This company, which is wholly owned by the Government, is using the most significant and highly sophisticated tax mechanisms in the book. There is nothing wrong with that. What it is doing is completely right, but members of the Government say that Mr Boucher is right. If Boucher is right, Qantas is wrong. They cannot have it both ways. The Government owns Qantas 100 per cent. If Boucher is wrong and Qantas is right, Boucher should be told what his position is. He is not an interpreter of the law. Parliament writes the law, and it is not for Boucher to interpret it. Members of the Government should make up their minds on these taxation matters. Qantas is being forced into these arrangements because the Government will not contribute the capital necessary to fund the airline's ongoing operations. That is apparent in the balance sheet itself. Before I look at that, I draw attention to an article in the Economist of 30 July 1988 which refers to the projected growth of world airline traffic between 1988 and 2005. It forecasts that the growth in America will be roughly static; in Western Europe it will probably decline marginally; in the area of Asia and the Pacific it will increase by approximately 50 per cent; and in the area of Japan it will increase by approximately 50 per cent. There will be a small decline in the Middle East; a 25 per cent increase in Latin America; a small decrease in Africa; and a small decrease in Canada. This shows the enormous growth that will occur in the areas in which Qantas predominantly has its routes. In order to handle this, Qantas must be in a position to finance its operations adequately. It will be operating in the fastest growing area and, as the honourable member for Fadden (Mr Jull) knows better than I, he being a veteran traveller and experienced airline man, this company will require an enormous increase in capacity to be able to cope with the projected demands of world changes in the next 20 years. The balance sheet for 1987 shows a paid-up capital of $149m and total assets amounting to $2 billion, but there are large off-balance sheet figures involved in leasing arrangements, probably something of the order of the assets outstanding. So there is probably $2 billion shown in the off-balance sheet statements. What does the Government think it is running? A two-up school? Today's issue of the Commonwealth Bank annual report indicates a similar position. In the past 12 months the asset position of the Commonwealth Bank has not changed. Every other bank in Australia had a significant increase in its asset position. Qantas, starved of capital, is required to pay a dividend, required to pay taxation, and so uses the most sophisticated financial measures in relation to its leasing and offshore taxation arrangements. This is forced upon it by the actions of the Government. What would the Opposition do in relation to this matter? In view of the very large outstanding commitments of Qantas, the projection of the Economist of a 50 per cent increase in traffic over the next 20 years and the shortage of capital, the Opposition would simply offer the existing public company a substantial expansion of its capital base. We would take it up from $149m to at least $500m, as a starting point. Those shares would be offered first to Qantas employees. When I recently travelled on Qantas I asked the stewards what they thought of having access to ownership of shares in their airline. I did not find one member of the staff flying that night who was not keen to be in it-and one of those stewards was a member of the Australian Labor Party. He could not understand why his lot were not on side with the idea. He was not a bad steward either. He seemed a bit misled in some areas but he certainly knew the value of Qantas. As a consequence of that, I have no doubt that the staff would be involved. The balance of shares would be offered to the public at a market rating appropriate to the time. Mr Rocher —With safeguards. Mr MOORE —With appropriate safeguards concerning foreign ownership. Mr Gear —How many would the pensioners buy? Mr MOORE —Pensioners who could save a few bob would buy every one they could lay their hands on and they would do a better job than those who walk around the nation with price watch schemes. At the end of all this Qantas would have a $500m capital base listed on the stock exchange, would be paying dividends which would be higher than those paid at the moment, because it would not have to pay so much interest-and it would be paying a higher rate of taxation for the same reasons-and because of the employee incentive to increase productivity of the airline to meet the competition there would be a far greater spirit. People who own equity in a company have a surprising degree of commitment to the performance of that company. Even Western Australian members would probably reach a little further in doing things if they were financially involved. As a consequence of that there would be a massive increase in the profitability of the company, with a resultant relief to some of the company's capital debts. It might well be that $500m is nowhere near the capital base necessary to meet the demand by the year 2000, in view of the projected increases in demand in Japan and the Asian and Pacific areas. But it would be a modest beginning which would involve Qantas employees and other Australian investors in setting up a more substantial base for the company which would then bring about greater profitability and greater presentation. I shall briefly allude to another recent innovation. The Government is now allowing Qantas to enter into a deal with Air New Zealand. It is really an extension of the old British nationalisation system. Here is a company which is undercapitalised, at $149m, ordering aeroplanes for the future-and using sophisticated offshore tax arrangements to do so-and all of a sudden it is moving to buy 25 per cent of Air New Zealand. What is the reason for this? Taxpayers' money is being committed to a deal that is not wanted. It is clear that Qantas does not want it; that was clearly stated by its chairman. The Air New Zealand people appear not to want it because they are doing a great bagging job on the deal in the background. The Government is proposing to put up taxpayers' money-more borrowed money, not its money. It is going to borrow some more money to get into it. If it is successful, do not think Air New Zealand is mug enough to say, `That's good enough; we won't call up more money from you guys as major contributors'. That is the first thing it will do. The first thing Qantas is going to have to do is put up the brass to buy planes for Air New Zealand. What is it going to be able to do, with the capital base here, but borrow more money offshore to fund planes for Air New Zealand? What do we hear from the Government? Not a peep. It all helps with this good old game of owning things in the public sector. It does not have to justify things to the lefties in the Australian Labor Party or that lot who want to continue public ownership. Those people know that if they were to give up the ghost and allow these things to be privatised, then the real control would slip from the trade union movement. The losers would be the trade union movement. They are the ones who are most concerned about it. It is not the personnel of Qantas who want privatisation, it is not the management of Qantas who want privatisation, and it is not the board membership, in the main, who want privatisation, as the Chairman has said. That case falls totally to the ground. I return, if I may, to the case put before us tonight in which we are approving-- Mr Martin —You haven't done too well so far. Mr MOORE —I have done a damn sight better than the honourable member in relation to arguing the case of privatisation. I have not seen anything in what he has put forward about how Qantas is going to survive to the year 2000-not a word. It will not survive if the Labor Party here continues to force Qantas to borrow funds offshore in leasing arrangements which are straight tax dodges. It is a complete farce in every respect and a case of double standards in relation to the taxation agreements that it goes on about with Boucher. I say in conclusion that no government enterprise in the future will be able to withstand the call from its employees to be freed and to be able to prosper. Any politician or political party that wants to stand out there and say `We are going to continue to run you as a government' will be swept aside. I say this because part of what Gorbachev is on about in Russia is the acknowledgment that the economic system will not function under a socialist scheme without personal incentive. Mr Willis —How would you know? Mr MOORE —I was there a couple of weeks ago and that is what is going on. The Minister ought to have a trip. They will give him one too. As a consequence, not only communist China but Russia is turning to personal incentive. That is what perestroika is all about-getting the system going, getting the economy going. If those countries can see it, how strange is it that the Australian Labor Party cannot see it in relation to its own enterprises? Mr Gear —Is Aeroflot on the market? Mr MOORE —If Aeroflot is on the market at a reasonable price the Government ought to buy it because it has got a long way to go back to reasonable operations. Mr Gear —Can you pick it up? Mr MOORE —I would not expect the honourable member to understand that. At price watch they are not in the game of making money. He would be far better on cornflakes than he would be on aeroplanes. The consequence of that, I would suggest, is that the whole emphasis of the Government as it relates to funding of public enterprises needs to be reviewed, needs to be understood. If it does not adequately fund publicly owned enterprises like Qantas, the Commonwealth Bank, Australian Airlines, the Overseas Telecommunications Commission and many others, all of them within 10 years will be virtually out the window. Dr CHARLESWORTH(Perth)(10.25) —The Qantas Airways Limited (Loan Guarantee) Bill 1988, which I must say has hardly been touched on by members of the Opposition, relates to the authorising by the Treasurer (Mr Keating) of borrowings and the guarantee of borrowings by Qantas. There are few-in fact I am bound to say there is no-one-on either side of the House who would disagree that there is a need for Qantas to increase its fleet of aircraft. Indeed, the growth that has occurred in the trans-Tasman route and between Australia and Japan has been so significant that it is necessary for these aircraft to be purchased. We are not surprised that the debate turned around to one of privatisation. I suppose one of the things we learn in this place is that hindsight is a very valuable commodity. But if we look at the figures which relate to Qantas at the time when the Opposition held the purse strings and sat on the government benches in this place, it is very interesting to find that between 1976 and 1983, when we came to government, there was a very small injection of capital into Qantas-$25 million-by the former Government. During those seven years, at a time when Qantas was in a parlous state, the capital injection provided by the Opposition was only $25m, hardly enough for Qantas in any of those years to turn over a dividend. Indeed, in only one of those years did it do so. So did the Opposition in those seven lean years embark on the strategy that it now proposes, to privatise Qantas? Did it provide significant capital for Qantas, an airline which then was greatly in need of capital-I do not think anybody on either side of the House would suggest that is not the case now-either by injection from government sources or by taking the course which it now proposes? What was the Opposition's attitude to domestic airlines in this country? Were the bastions of private enterprise, these great free marketeers, involved in deregulating the airlines of this country or were they involved in providing a straitjacket which I suppose is now, after initiatives by this Government, finally to be removed? Certainly, the rhetoric of members of the Opposition is very interesting to hear but, if we look at its performance and its record in government, we find that, far from privatising, deregulating and providing the capital that was necessary for Qantas, its approach was completely different. I do not think any of us would disagree that the airline industry is a high-tech industry. Very expensive aeroplanes, expensive capital equipment and expensive computer facilities need to be bought. Because of the success of this Government's tourism policy and because of the massive increase in the number of people wanting to visit Australia, there is a massive increase in demand and there has been a massive increase in the profitability of Qantas. That is something for which this Government can take credit. The Government is aware that Qantas is in need of capital injection. That is not anything we run away from or anything we have hidden from. Indeed, a number of papers produced by the Government have expounded that view. But what we need to realise is that this issue is being considered in a very broad context, just as this Government has taken a broad approach to a number of issues relating to the economy. We inherited an economy which was too dependent on rural and mineral commodities, an economy which was not adaptable and which could not respond to the influences of overseas changes and absorb the shocks that inevitably come from overseas. So the Government took the macro-economic focus and brought about a more mature, adaptable and flexible economy for the country by floating the dollar, deregulating our financial system, liberalising foreign investment and reforming the taxation system, and in a number of other ways we have produced that sort of economy. In the same way, we took an approach to government business enterprises which would make them more efficient and allow them in a number of ways to compete more readily. At the same time we were looking very closely at many of those government business enterprises. Debate interrupted. Madam SPEAKER —Order! It being 10.30 p.m., I propose the question: That the House do now adjourn. Mr JULL(Fadden)(10.31) —Twelve months ago in this House I raised a matter of public importance concerning the capacity of international airlines to handle inbound traffic to Australia. Honourable members who are present tonight may remember that debate, because I expressed my concern that in many ports outside Australia a total of about 45,000 people were waiting for seats on flights into Australia. I remember the response of the Government at that time and, indeed, the response of the national airline, Qantas Airways Ltd, to my accusations. In my files in my office-which I will keep forever-I have a telex from Qantas which is about 2 1/2 metres long, telling me how I had been misled, how I was not telling the truth, and how I was exaggerating the situation. I want to raise that issue again tonight. At the beginning of October this year, in the ports of Asia up to 45 people per flight were waiting for seats on flights into Australia. Those people were not Australians waiting to come home; they were international visitors who wanted to come here and spend their money, thus helping our foreign receipt earnings. Once again we have not learnt the lesson. The debate that preceded the adjournment tonight was very interesting because it was at the crux of what I am talking about. We do not seem to have a capacity to judge markets, to get our instrumentalities to adapt to market demands. Once again we are facing an absolutely farcical situation. International visitors who want to come to Australia cannot get seats on flights into the country. My question is: When will we ever learn? This is not the first time that I have tried to promote in this place the concept of opening up the skies of Australia so that the tourist industry can reach its true capacity. It seems to me to be absolutely farcical that, when we have a government that is doing its very best-and I concede that point-to promote Australia as an international tourist destination, we do not seem to have the capacity to promote the infrastructure to make sure that we can handle the business. The most farcical situation that we have seen has occurred in Brisbane. I refer to World Expo 88. Five years ago there were projections of the numbers of international visitors who were expected to come to Australia to visit Expo. Who took any notice of those projections from organisations such as the Boeing International Corporation? The answer is that nobody took any notice. Throughout the staging of Expo we have found that people could not get seats on flights into Brisbane or, indeed, into Australia when they wanted to come. The real condemnation of government instrumentalities is that, finally, Australia's national carrier, about five months ago, recognised what the real demands were going to be. I congratulate Qantas for introducing a new schedule for the port of Brisbane to cope with Expo. The new schedule came into operation on 1 October-29 days before Expo will end. That is the problem that we have. While we talk about the tremendous contribution that tourism is making to our foreign account situation-it is quite true that it is our second biggest hard currency earner at the moment-we do not seem to have the capacity to provide the wherewithal to bring it all about. The really sad condemnation of this Government is that it has had notice of this situation for the last five years. I congratulate it for its overseas promotional efforts. I condemn it for its failure to provide infrastructure to meet the demand, which will not go away. Two million international visitors will come into Australia this year. By the year 2000 we will have five million. In an earlier debate in this place today we spoke about leasing three Boeing 767s. What do they carry? They carry 220 passengers each. And we have to more than double the size of the international tourism market into Australia. We do not know what it is all about. Madam SPEAKER —Order! The honourable member's time has expired. Mr SIMMONS(Calare)(10.36) —One of the finest sporting achievements by one of my constituents was the recent courageous effort by Graham `Spike' Cheney to win a silver medal at the Seoul Olympics in boxing. There could be no overstatement of the bravery and straight-out guts of this young man who, at only 19, has taken on some of the toughest and hardest hitting sportsmen in the world today. Given this fact, it is not surprising that the people of Lithgow are bursting with pride and admiration for his efforts. In fact, Lithgow is a very proud community. It is a very close-knit community. The people of Lithgow stick together. Sporting clubs from other nearby towns and cities in the electorate think twice when they have to play a Lithgow side at Lithgow because they know the home crowd will be big and will be vocal in support of its side. That is just the sort of place that Lithgow is. So one can imagine the justifiable reaction of the people of Lithgow to a number of insipid and patronising articles in the Sydney media about the home of Spike Cheney. The strongest reaction has been against a bit of a `colour' piece that appeared in the Sydney Morning Herald on 30 September. Apparently the paper had sent someone to Lithgow to `get the local feeling' on the night of the semi-final bout. Unfortunately one night in Lithgow was apparently not enough to get an accurate portrait of the place, its people and its character. This article must rate as one of the most condescending bits of fiction in the name of journalism that I have ever read. An editorial more correctly expressing the mood and feelings of the people of Lithgow appeared in the Lithgow Mercury the next day criticising the Sydney media. I would like to quote directly from the editorial, because there is no way I could better word my criticism of the Sydney Morning Herald report. I quote: The report was more like an episode of Dad and Dave. A few quotes: ``They had gathered at the Lithgow's spiritual heart, the Landowne (sic) Hotel, to cheer one of their own''. Even Barry Rushworth wouldn't describe the Lansdowne ``the Spiritual Heart''. ``They were all there-his football mates, town bikes, his drinking companions''-Bikies? Football mates? A teetotaller's drinking mates?-``none of them could really pronounce Seoul. . .'' We must have forgotten to mention that we've all been on correspondence lessons since the old bush school burnt down. ``These were people who don't display emotion easily''. . . the reporter clearly wasn't there at closing time. . . . and this classic. . . . . . ``they grouped around an ancient radio cassette. . .'' Wonder what Sky Channel thinks of that? . . . or this one. . . ``Faces creased with the hard lives of a miner rested upon shoulders of their mates and concentrated on the small grey radio''. . . . and to finish up. . . ``. . . cheers swamped the small pub where most of Lithgow had gathered''. That must be why there was no one at Lithgow's other eight pubs or four clubs on Thursday and children at home were howling for their mums and dads. We hesitate to imagine what they'll write if they turn up for Spike's welcome home next week . . . that's if the stage into town is still running. While the Sydney media have tried to poke fun at the City of Greater Lithgow, not recognising even that it is even a city, the people of Lithgow have been working very hard toward the more serious task of promoting the city. Yes, the city has had its problems with the closure of mines and economic hardship that this produces, but civic leaders and the population as a whole have been making a tremendous effort to promote the positive aspects of the city. Very few Sydney people would associate Lithgow with other important business enterprises, such as the Small Arms Factory, which is currently producing a new generation of small weapons for the Army, or to the textile industry which provides valuable employment, particularly to women in Lithgow. And of course how many city people would be aware of Lithgow's other Olympic success story? Berlei-Hestia, which has a factory in Lithgow, was the official supplier of the undergarments worn by our female Olympic athletes. Lithgow also has a burgeoning tourist industry, with the Zig Zag railway attracting thousands of visitors each year. The Greater Lithgow Development Task Force, funded under the Country Centres Project, is looking at still further ways of diversifying the economy and making the most of the human and natural resources of the area. But still, media sources from east of the Blue Mountains continue in their efforts to portray Lithgow as a depressed and depressing mining community-not the vibrant commercial and social centre that it is. Mr JULL(Fadden)(10.41) —Earlier in this debate, I was mentioning the problem we appear to have in providing the infrastructure to meet the demands of international tourists who want to come to Australia. I specifically mentioned the difficulty that is being experienced already in this high tourist season of international visitors trying to obtain seats on international flights into Australia. I urge the Government not to repeat the mistake it made 12 months ago by not loosening up the system quickly enough to be able to provide the additional services to handle that additional traffic flow. I also mentioned that this year there will be in excess of 2 million international visitors into Australia and I flag the fact that on all estimates in 1990 that amount will almost double. By the turn of the century there will be more than 5 million international visitors coming into Australia. That really brings home the difficulties being faced in providing that infrastructure. What really worries me with the situation that has evolved with this Government is a lack of cooperation between Federal Government departments in trying to coordinate those efforts to provide the necessary infrastructure. It is true that more than eight years ago the Boeing International Corporation provided a report on the estimates of international arrivals into Australia. The recommendations made by the Boeing International Corporation have proved to be very conservative indeed, and in fact an underestimate occurred. But the real nub of the situation is that when these reports have been received from companies such as Boeing, which know the business, no notice has been taken of those estimates whatsoever. The result is that in 1988, when Australia is flavour of the month, we have great difficulty in being able to provide the ground facilities. There would not be one member of this House who would deny the fact that we have on our hands a number of disasters. I suppose the biggest disaster we are facing with the international visitors' arrival is the situation at Sydney Airport. At the moment Sydney international terminal is a disgrace and there is a general recognition that something must be done and it must be done quickly. The sad thing that has evolved in the case of Sydney, in the case of the new international terminal for Brisbane, and in the case of Melbourne to a degree, and I suppose even the debacle that has ended up as the international terminal in Perth, is that the Government in its wisdom has handed over the whole situation of our airports to a quango. The Federal Airports Corporation has been set up and we have seen disaster after disaster and a complete lack of capacity by that organisation to adapt to a real situation. Mr Campbell —Because you are pork-barrelling in Queensland. Mr JULL —We are not pork-barrelling in Queensland. Let me remind the honourable member that the port of Cairns is now a bigger international airport than Perth. The reason for that is that prior to 1983 the Government, in its infinite wisdom, allowed the Cairns Port Authority to set up that airport unencumbered from Federal Government intervention. That airport went out and got the business. I am glad the honourable member for Kalgoorlie (Mr Campbell) has raised the issue because this is what I am all about: that we do not have the capacity to provide the infrastructure. What we really should be doing, rather than handing over the situation to quangos, is getting into the marketplace and letting the people who really understand the situation go about the business of providing that infrastructure and providing it at no cost to the taxpayers of Australia-indeed, providing the infrastructure at a profit. That can be done. It has been proved that it can be done-not only in the United States of America but also in Britain at present and in ports such as Amsterdam, Copenhagen, Bangkok and Singapore. But, for some strange reason, we are not prepared to say to private enterprise, `You can provide this service better than we can; go ahead and let us relieve Australian taxpayers of the unbelievable cost of providing this infrastructure'. I think one of the things that the new Minister for Telecommunications and Aviation Support (Mr Punch) should be doing as a matter of priority is going about seeing how we can in fact relieve the Australian taxpayer of this incredible cost. If he looks at this matter wisely and well, he will see that the only option that we have is to let it out to private enterprise. Let us make a profit on the whole thing. Madam SPEAKER —Order! The honourable member's time has expired. Mr SCIACCA(Bowman)(10.46) —Tonight I wish to tell of the considerable hardship being suffered by two of my constituents and their families at the hands of the Queensland State Government as a direct result of the operation of one of its many boards, or quangos as they have come to be known. What has happened to these people and the State Government's handling of their complaint is grossly unfair and utterly disgusting. Both of my constituents, Mr Garth McDonald and Mr Fred Williams are the owners of chicken farms worth in excess of $600,000 each. Well over a million dollars worth of shedding and equipment has been made absolutely worthless by the Chicken Meat Industry Committee (CMIC), a State Government quango and, through its inaction, by the State Government itself. Because of what appears to be deliberate State Government policy, not only can these farms not be used for their intended purpose, but they cannot be used for any other purpose or, for that matter, even sold. This is a story of gross harassment and abuse of power. It is an actual life account of the effect on ordinary hard-working Queensland men and women, of the tangled web of bureaucracy which has manifested itself in the form of boards and committees. It shows how they choke the life out of enterprise in what is supposedly a free enterprise State with a free enterprise Government. It is of particular interest to note that Mr McDonald, until recently, has been a staunch supporter and I believe member of the National Party. In fact, I remember during the last Federal election seeing Mr McDonald outside a polling booth handing out how to vote cards for the Nationals. I can assure the House and National Party members that he now regrets every single vote and ounce of effort which he has given to that Party. In 1984 both men had their contracts with Inghams Enterprises Pty Ltd, a major chicken meat processor, terminated. In the case of Mr Williams, this occurred because he was supposedly growing for another processor simultaneously with Inghams. This was undoubtedly the case, but he did so with the permission of Inghams. In the case of Mr McDonald, it was because he attempted to sell his farm as a going concern-that is, with the contract. This is something which was apparently quite normal practice in the industry, but for reasons best known to itself, Inghams terminated the contract on that basis. Neither person was given the six months' notice which is required under the contract. In short, I believe that they were mistreated. This is where the Chicken Meat Industry Committee comes into the picture. Both Mr Williams and Mr McDonald referred their case to the CMIC in the hope that some justice would be done. Under section 15d of the Act which establishes this quango, it is stated that one of the board's functions is to `mediate in disputes between processors and growers'. The Committee found that, despite the apparent lack of logic or justice in the termination of the contracts, all was well and the contracts were terminated properly. It is relevant to note the composition of the Committee, which is specified in clause 6 of the Act. There is a Chairman, who is appointed by the State Minister for Primary Industries, three representatives of processors, appointed by the State Minister and three representatives of growers, appointed by the State Minister. This composition has all the hallmarks of a National Party State Government quango. The really telling sign is the fact that everyone, absolutely every member of the board, is appointed by the Minister. There is plenty of scope to reward loyal members or supporters of the Party for their years of dedication, except of course Mr McDonald and Mr Williams. The other important thing about the structure is that, although three representatives from both the growers and processors may on the surface appear fair, the fact is that growers cannot exist under the Act without being contracted to processors. The Act effectively prevents by way of its definition of the term `grower' any person in Queensland from growing more than 1,000 chickens at a time without being contracted to a processor. I understand that at the time of the appeal by Mr Williams and Mr McDonald, one of the processors was Inghams and two of the growers held contracts with Inghams, the very company that caused the dispute by terminating the contracts. This State Government kangaroo court delivered anything but justice to my constituents. Almost needless to say, their appeal was rejected. This is despite being supported by way of a petition signed by two-thirds of growers in the Brisbane area. Despite repeated requests for justice, the State Government has ignored them. They now own chicken farms which cannot be sold because they have contracts attached to them. They cannot be used for any purpose because the local shire council has determined that industrial activity at the sites would be incompatible with the character of the areas. They are prevented from growing more than 1,000 chickens by an Act which is designed to preserve monopolies written by a government which has the gall to call itself free enterprise. Approximately eight sheds for Ingham growers have been established in my electorate since the time that their contracts were terminated. Yet these farms, with the capacity for more than 100,000 chickens, are idle because of the abuse by a large company aided by a State government that does not care about the welfare of small business. I call on the Queensland State Government to review this present foul situation urgently and amend its shonky Act so that it can never happen again. Mr ANDREW(Wakefield)(10.51) —In the history column of today's Canberra Times a little snippet appeared which, I suspect, was largely overlooked by most people in Canberra but which, I am pleased to say, was picked up by a member of my staff. That column pointed out that on this day 150 years ago, in 1838, Lieutenant-Colonel George Gawler arrived in Adelaide and on 17 October was sworn in as Governor of South Australia. As one who now resides in the city of Gawler in South Australia and as one who chose to move there because it is far and away the largest centre and most rapidly growing area in my electorate, I was interested to have this snippet brought to my attention. I was interested to discover that Governor Gawler was born in 1795 and died in 1869 and what we celebrate today occurred 150 years ago, just two years after the birth of South Australia. Gawler was trained at the military college at Great Marlow in England, and achieved the rank of Lieutenant-Colonel. He arrived in South Australia just when Governor Hindmarsh was having desperate disputes with the then resident commissioner of the South Australian Colonisation Society. To his horror Governor Gawler discovered that he was very quickly immersed in all the difficulties of that young colony. In fact, in 1838 there were 5,000 residents in South Australia still clinging to the city of Adelaide, unable to feed themselves and reluctant to move from the city because no land survey had been completed. I am grateful to the Parliamentary Library for providing me with some information on Governor Gawler and I would like to read a paragraph of that information. The information indicates that Governor Gawler, having arrived in South Australia, discovered the following: The settlement had to be fed from outside, and most of its revenue was spent on food. Gawler had to start relief works near Adelaide for the poorer settlers; he spent the whole of his private means and drew bills on the London authorities for #270,000. By the end of 1840 the colony's financial position was desperate and the British Government, dishonouring his drafts, recalled Gawler. The news was brought to him by his successor, Captain (later Sir) George Grey in May 1841-a blow to his pride from which he never recovered-and he returned to England in 1842. His work was long misjudged, largely because Grey's dispatches made the worst of his actions without suggesting the difficulties under which he had laboured. Actually, Gawler had done well for South Australia. He had appointed Charles Sturt Surveyor-General and encouraged in every way the completion of surveys. He had erected public buildings, organised a police force, and promoted the development of religious and social life . . . During his term 6,000 colonists were settled on the land. Too little has been made of this man's impact on the history of South Australia. The city in which I now reside bears his name. The city of Gawler has become a satellite city for Adelaide, but it valiantly defends its character as South Australia's oldest country town. As honourable members would expect in view of its age, Gawler is a town which is dominated by bluestone buildings and the remnants of what was once a great foundry. Through it runs the picturesque River Light. I point out that in 1986 the city of Gawler was host to the world three-day horse riding event and in fact horse activities have dominated the now rural tranquility of that part of South Australia. It is the gateway to the Barossa Valley and it will best be remembered by recent visitors from this Parliament, who were members of a committee on which I served, for the experience of one committeeman. He was travelling past the Gawler raceway and he saw another of our members running around the raceway in a manner reminiscent of the sort of shuffle that characterises Cliff Young. He was not surprised therefore to find that that member was the honourable member for Corangamite, Mr Stewart McArthur, in whose constituency Cliff Young resides. Mr GEAR(Canning)(10.55) —Following the re-election of the Cain Government in Victoria, the Western Australian Government will be next up for re-election. If ever there was any doubt about that, one has only to look at the front page of today's West Australian, which is headlined `Liberals wavering on tax file number'. Mr Kerin —Dowding is growing in the job. Mr GEAR —He is growing in the job, as the Minister intervenes. To know who is pushing this charge, we look half-way down the report and we see: Western Australia's Opposition spokesman on individual rights, Mr Hassell . . . Those of us with a bit of a memory will remember that Mr Hassell was a senior Minister in the Court Government that brought in section 54b, that oppressive legislation-- Mr Kerin —I remember it well. Mr GEAR —The Minister remembers it. That legislation meant that no more than three people could meet in the streets of Perth without a police permit. Mr Hassell, an ex-Minister in that Government which brought in that oppressive legislation, now has the role of Opposition spokesman on individual rights. There are many glittering virtues he might have to be a member of the Liberal Party, but the one he really has to have is front. Mr Hassell has more front than St George's Terrace. This born-again civil libertarian is now saying that we have to get rid of the tax file number. The article went on to say: Mr Hassell said privacy was not the basic issue. `The basic issue is power-Government power over the people-the taking away of our most basic rights as a free people'. Those of us with a memory will always remember that Mr Hassell was the Minister for Police at the time of the infamous Noonkanbah dispute, where he used section 54b and the gestapo tactics of that day to break up legitimate picket lines. Here we have this born-again civil libertarian trying to do away with the tax file number. Mr Kerin —He is looking after his tax dodger mates. Mr GEAR —The Minister says he is looking after his mates. Mr Downer —Labor is the great party of mates. Mr GEAR —Why don't you go back to your dolls' house? The article continues: The tax file number system is expected to return $2.2 billion in revenue over 10 years by cracking down on tax fraud and welfare cheats. That is something the Liberal Party, especially in Western Australia, would know all about. What we are seeing here is the Western Australian Liberal Party, for grubby political purposes, trying to put pressure on the Federal Liberal Party in Canberra to reject the legislation on the tax file number, notwithstanding the fact that this Government has gone out of its way to consult all groups and has deferred its privacy legislation so that the Opposition can have a good look at it and make sure it is up to its high standards. Apart from doing all that, we now hear from the Western Australian Liberals that they want to junk the file number. If the Liberal Party in the Senate were to do that, taxpayers would miss out on $2.2 billion worth of tax cuts. The reason for bringing in the tax file number is to increase the efficiency of the Australian Taxation Office to make sure that it can match all the information it currently gets, to bring it up to 1988, and so that the computing power and facilities this Government has given to the Tax Office to make it more efficient can be used in the most efficient way. Yet for the most grubby political purposes, the Western Australian Liberal Party wants the Federal Liberal Party to do away with the number. I also have a copy of a media release put out by the Western Australian Liberal State President, Mr Simpson, who is calling on the Federal Liberal Party not only to scrap the tax file number but also to oppose the tax on gold-that is, the company tax. Half-way down the statement Mr Simpson said that he has decided `to ask all Western Australian Federal Liberal MPs to continue to do all in their power to ensure no income tax is imposed on the goldmining industry'. He cannot even get that right. The fact is that it is company tax, not gold tax or income tax, as Mr Simpson said in the release. In Western Australia now, with an election not far away, we are seeing the Liberal Party doing exactly what it does best: trying to scuttle decent legislation in this House. Madam SPEAKER —Order! It being 11 p.m., the debate is interrupted. The House stands adjourned until 10 a.m. tomorrow. House adjourned at 11 p.m. The following notice was given: Mr Porter to move- That- (1) the Government's failed social and economic policies have caused widespread poverty among Australian families which will not be overcome by the Government's new family assistance package; and (2) the Government must reverse the record interest rates, high unemployment, high marginal tax rates, housing shortages, high rents and falling value of family allowances if it is to offer real assistance to Australian families. The following papers were deemed to have been presented on 12 October 1988: Civil Aviation Act-Civil Aviation Orders-Parts- 105-Amendments, dated 27 September 1988. 106-Amendments, dated 27 September 1988. Health Insurance Act-Determination pursuant to section 4a, dated 8 September 1988. National Health Act-Determinations under subsection 4 (1) for purposes of the following paragraphs of the definition of ``basic private table''- (dc), dated 29 July 1988. (dd), dated 1 September 1988. Seat of Government (Administration) Act-Variations of plan of lay-out of City of Canberra and its environs, dated 5 October 1988 (3). The following answers to questions were circulated: (Question No. 1069) Mr Porter asked the Minister for Employment, Education and Training, upon notice, on 3 June 1988: (1) What week-end conferences, including management meetings and team-building exercises, and involving overnight accommodation have been conducted out of Canberra for staff of the Minister's Department for the year ending 31 May 1988. (2) When and where were the meetings held. (3) How many days were involved. (4) What was the agenda for each meeting. (5) Who attended each meeting from the Minister's Department and from outside the Minister's Department. (6) What was the total cost to the Minister's Department. (7) What were the itemised costs, including transportation, accommodation, speakers, food and drink costs. Mr Dawkins —The answer to the honourable member's question is as follows: (1) Nil (2) to (7) Not applicable. (Question No. 1104) Mr Langmore asked the Minister for Primary Industries and Energy, upon notice, on 22 August 1988: (1) Have any purchasers been, or are now, in arrears in payments to the Australian Wheat Board; if so, which countries and what has been, or is the extent of their arrears. (2) What has been done to cope with these debts through rescheduling or other means. Mr Kerin —The answer to the honourable member's question is as follows: (1) Payments for wheat sold on credit by the Australian Wheat Board from time to time become overdue. The extent and frequency of these late payments varies according to the market; with Egypt for example, it is not unusual for payments to be from 30 to 60 days late. However, the payment obligations in respect of all credit sales have always been met except in the case of Egypt where an agreement was reached in May 1987 under the auspices of the Paris Club to reschedule some $3909 million of wheat debts. These debts aside, overdue or late payments to the AWB (25 August 1988) amount to $A9 million and US$8.8 million, all relating to wheat sales to Egypt. (2) Together with other creditor countries, Australia participated in a Paris Club meeting in May 1987 to provide debt relief to Egypt for official and officially insured debts. At that meeting it was agreed that debts relating to contracts entered into before 31 October 1986 and falling due before 30 June 1988 should be rescheduled. Participants agreed that there should be a 5 year grace period for the rescheduled credits, with repayments of 10 equal and semi annual instalments commencing on 31 March 1993. The AWB's credit sales to Egypt are covered by payments insurance through the national interest provisions of the Austrade Act. Claim payments were made to the AWB under its insurance policy with Austrade EFIC in March and June 1988. The Paris Club agreement requires that Egypt sign a bilateral agreement with each participating creditor nation to implement the multilateral undertakings agreed to at the Paris Club. In Australia's case this agreement was signed in Cairo on 29 June 1988. The bilateral agreement is considered to be a satisfactory outcome for Australia as arrangements for the payment of interest have a commercial basis which should recover refinancing costs. (Question No. 1141) Mr McArthur asked the Minister for Employment, Education and Training, upon notice, on 24 August 1988: (1) Why was Mr P. Steedman, who is listed as a consultant, appointed to the Board of Directors of the Australian Contemporary Music Development Company (ACMDC). (2) What qualifications and expertise does Mr Steedman have which make him eligible for such an appointment. (3) What remuneration does Mr Steedman receive as a member of the ACMDC Board. (4) What is the term of his appointment. (5) Were suitably qualified specialists in the music and entertainment professions considered before the appointment was offered to Mr Steedman. (6) Why does the ACMDC need the services of a consultant on its Board. (7) What are Mr Steedman's specific duties. Mr Dawkins —The answer to the honourable member's question is as follows: As at 24 August 1988 (1) and (2) As a consultant to me, Mr Steedman has been working on the special project of establishing the ACMDC, and for the first year of the Company's operations he and a senior government official have been appointed to sit on the Board. After two years of research and negotiations, he has one of the best overviews in the country of all aspects of the industry. (3) None while employed as a consultant to me. (4) To 31 August 1989. (5) He is one of 12 Board members, 10 being from the industry. Skills other than those of musicians and entertainers are needed by the company. (6) Mr Steedman is not a consultant to the Board. (7) With other members of the Board, to fulfil the purposes of the Memorandum and Articles of Association of the Company which are designed to assist in the development of the music industry in Australia. (Question No. 1169) Mr Smith asked the Minister representing the Minister for Home Affairs, upon notice, on 31 August 1988: (1) What is the annual capital allocation to the Australian Government Analytical Laboratories (AGAL). (2) Do costs include an interest payment on such capital. (3) What are the total Government outlays to operate AGAL. (4) What is the total advertising budget for AGAL, including brochures, mailing, and stands at conferences. (5) Does AGAL pay (a) sales tax, (b) payroll tax, (c) vehicle taxes and import duties and (e) taxes on any profit. (6) Are rental and building costs built into AGAL's fees structure; if so how. (7) What figures are available on AGAL's cost recovery program from the (a) Government and (b) non-Government sector. (8) Are there any contracts between AGAL and Qantas; if so, what is the nature of those contracts and what sum are they worth. (9) What proportion of AGAL's work is not open to public tender. (10) What level of departmental directives exist for Government agencies to use AGAL as distinct from private laboratories. (11) Do National Association of Testing Authorities accredited laboratories in private industry cover the same technical spheres as AGAL; if not, in what areas are they lacking. (12) Is there a need for the Government to operate in this area of the market since there are already 3000 private laboratories in Australia. Mr West —The answer to the honourable member's question is as follows: (1) Plant and equipment, $555 000 in 1988/89. (2) Interest payments on capital are not included in charges at present. I am currently considering a proposal on AGAL's future operating arrangements. This will establish the basis for fee charging and distinguish the cost of public interest functions from the cost of commercial services. (3) Estimated expenditure in 1988/89, including capital allocation in (1) above, is $9.9 million. Estimated revenue is $7.1 million. Net outlays are therefore $2.8 million. (4) $28 000 in 1988/89. (5) (a) No, (b) No, (c) No, (e) No. (6) No; refer (2) above. (7) Since the introduction of cost recovery the value of chargeable work undertaken has been: 1985/86 $2.467m, 1986/87 $4.672m, 1987/88 $8.617m. This is broken up as follows: (a) Government 1985/86 87%, 1986/87 75%, 1987/88 50% (b) Other 1985/86 13%, 1986/87 25%, 1987/88 50% Percentages for 1985/86 and 1986/87 in (b) above include some minor government bodies. The significant increase of the `other' sector in 1987/88 is due to the `one-off' demand arising from the analysis of pesticide residues in export beef. (8) Yes. AGAL undertakes microbiological testing for Qantas. Contractual details are commercial-in-confidence between the parties. (9) All of AGAL's work is undertaken on a competitive basis and clients are free to choose the source of their analytical services. (10) Government decisions confirm AGAL as the principal (but not sole) agency for the delivery of analytical services to the Commonwealth and require departments to seek price quotations from it. (11) AGAL is not responsible for monitoring private laboratory technical capability and does not have access to National Association of Testing Authorities' records. A detailed comparison is therefore not possible. (12) Yes. All comparable governments have national analytical facilities which guarantee independence and probity in analytical results in the areas of health, safety and law enforcement.