Monday, 17 October 1988 Mr ACTING SPEAKER (Mr Leo McLeay) took the chair at 2 p.m., and read prayers. Mr ACTING SPEAKER —Last week many honourable members expressed their sympathies to Madam Speaker. I conveyed those sympathies to her on the weekend and she asked me to thank those of you who did so. She is doing well and will be with us shortly. Mr ACTING SPEAKER —I have received an authority from His Excellency the Governor-General authorising me during any absence of the Speaker to administer to members the oath or affirmation of allegiance. I now lay the authority on the table. Mr ACTING SPEAKER —I have received a return to the writ which Madam Speaker issued on 5 September 1988 for the election of a member to serve for the electoral division of Oxley in the State of Queensland to fill the vacancy caused by the resignation of the Hon. Bill Hayden. By endorsement on the writ, it is certified that Les Scott has been elected. Mr Leslie James Scott made and subscribed the oath of allegiance as member for the division of Oxley, Queensland. Mr HOWARD —My question is directed to the Prime Minister. The Prime Minister will be aware that Australia invited the Royal Navy to be part of our bicentennial celebrations. Will the Prime Minister now apologise to the British Government and the captain and the crew of the British aircraft carrier HMS Ark Royal following the union actions which prevented the ship from docking in Melbourne? Or is Mr Halfpenny of the Socialist Left running our bicentennial celebrations as well as the newly elected Government of Victoria? Mr HAWKE —I am pleased at last to get a question from the Leader of the Opposition. It has been a long time coming, and on what a profoundly important subject. I am disappointed that elements of those fleets which were visiting Australia for our bicentennial celebrations and which played such an important part in adding to the lustre of those celebrations were not able to complete the whole of their proposed program. It is fairly well-known that I give no comfort or support to those whose actions, together with the weather, prevented the Melbourne part of the program being finalised. Knowing as I do the understanding that all overseas governments have of my commitment and that of my Government to the success of these programs, I dismiss the question for the stupid and irrelevant one that it is. Mr SAWFORD —Can the Prime Minister inform the House of underlying trends in the Australian economy, particularly in the light of recent employment indicators? Mr HAWKE —The employment statistics released last week indicate a continued high job growth plus, I am pleased to say, increased work force participation. As honourable members who are interested in the economy would know, employment rose by some 46,600 to be, on a trend basis, some 3.8 per cent above the level of a year ago, and the participation rate rose by a further 0.2 per cent to reach 62.6 per cent. This gives us the figure, for the period in which we have had responsibility for the control of this economy, of an increase in employment of 1,143,000, or an increase which is twice the Organisation for Economic Cooperation and Development average. To give a comparison with those opposite, that rate of employment growth is four times as fast as the rate of employment growth under our predecessors. The process of structural adjustment is continuing because we have returned real unit labour costs in this country to the level that applied at the end of the 1960s. The level of industrial disputes, which occasionally interests those opposite, is 60 per cent lower under this Government than it was under the Fraser-Howard Government. The average annual rate of manufacturing investment has increased under my Government three times faster than under the Fraser-Howard Government. It is a pleasure to report that in 1986 real manufacturing exports increased by around 15 per cent while last year they increased by some 13 per cent. It is known that the last Budget saw the elimination of the net public sector borrowing requirement, due largely to the third successive year of falls in real Commonwealth Government outlays. As well as those magnificent achievements in the macro-economy, it is also recognised that in the area of micro-economic reform and agenda this Government has gone far beyond anything that has been attempted or achieved in this country before. At the same time as we have had remarkable achievements in macro-economic management and reform of the micro-economy, we have not lost sight of the fact that social justice reform must be an integral part, as it has been in the agenda of this Government. At a time of supreme economic challenge for this country we have provided-through me, the Treasurer and other Ministers-strong leadership in the context of the right policy prescriptions. That record is clear and it speaks for itself. Yet when we look for the Opposition's policy alternatives we find none. When we look to the other side for any policy prescriptions we find none at all. The absence of policies from the other side is in stark contrast to the unequivocal promises that the Leader of the Opposition made to the people of this country earlier this year. He said in February of this year that he had a timetable for the release of policies. On 15 February he said: I have said all along that the timetable for policy release is by August . . . that is going to be adhered to. Of course, he had to be saying something earlier this year about the release of policy because in fact Professor Hewson, as he was before he came into this place, had mugged the Leader of the Opposition for the fact that he had not produced policies. I remind you, Mr Acting Speaker-- Mr Spender —Mr Acting Speaker, I take a point of order. The Prime Minister was asked a dorothy dix question about underlying trends in the Australian economy. I know that you have a great interest in the meaning of the word `relevance' and you would understand that, whatever kind of answer the Prime Minister is giving right now, to start talking about the timing of Opposition policies cannot be relevant and limitations have to be imposed even on Prime Ministers. I therefore ask you to tell him to be relevant or to sit down. Mr ACTING SPEAKER —Order! The Prime Minister was answering the question. I call the Prime Minister. Mr HAWKE —Mr Acting Speaker, I am making the point that the success of economic management in this country and in any other depends upon two things. It depends upon policies and strong leadership. What I am saying is that this Government has provided both the strong united leadership and the policies. By way of contrast I have pointed out that the Opposition still cannot produce its policies. It is no wonder that Professor Hewson, as he then was, said last year: It is equally difficult to understand why John Howard and his mates have not yet released their tax policy. Mr Acting Speaker, they still have not released those policies despite the promises that they made earlier this year that this country would have the alternative policies by August. It is now October and we still have not seen them. Mr Acting Speaker, it is quite clear why the Opposition has not produced its policies. The Opposition is racked by a leadership problem. Opposition members-Ha, ha! Mr HAWKE —Members of the Opposition laugh. Let us see what their leadership problem is. Mr Spender —Mr Acting Speaker, I take a point of order. We know about the Government's leadership problems. What I would like to know about is relevance. Mr ACTING SPEAKER —Does the honourable member have a point of order? Mr Spender —Mr Acting Speaker, how long is this sort of monologue on anything that enters the Prime Minister's somewhat troubled mind to be allowed to go on? Mr ACTING SPEAKER —Order! The honourable member will come to his point of order. Mr Spender —He has not been relevant. You should tell him that he has not been relevant and exercise all the power and authority that I am sure you are capable of-- Mr ACTING SPEAKER —Order! The honourable member for North Sydney will resume his seat. I call the Prime Minister. Mr HAWKE —Thank you, Mr Acting Speaker. I note-- Mr Spender —Mr Acting Speaker, will you at least give a ruling upon the point of order so that we know whether relevance has any meaning here. Mr ACTING SPEAKER —The opinion of the Chair is that the Prime Minister is answering the question. Mr Spender —God help us! Mr ACTING SPEAKER —The honourable member for North Sydney might also not make asides like that which may be offensive to people listening. I call the Prime Minister. Mr HAWKE —Mr Acting Speaker, I can well understand that they do not want to hear about this issue because-- Mr Tuckey —Mr Acting Speaker, I take a point of order. My point of order is also on the question of relevance. I bring some authorities on the matter to assist you in your decision. I thought you might be interested in the remarks made by no less an authority than the Governor-General designate when, on 30 April 1981, he said: Question Time and much of the parliamentary procedure becomes a low farce-- Mr Beazley —Mr Acting Speaker, I take a point of order. Mr Tuckey —I am on a point of order-sit down! Go on, buzz off! Mr ACTING SPEAKER —Order! Does the Leader of the House have a point of order? Mr Beazley —My point of order is-- Mr Tuckey —Sit him down. Mr ACTING SPEAKER —Order! Mr Beazley —My point of order is-- Mr ACTING SPEAKER —Order! The honourable member for O'Connor and the Minister might listen for a minute. It is obviously competent for a person to take a point of order on what someone else is saying. The honourable member for O'Connor was about to launch into-from what I understood him to be saying-a rather lengthy dissertation as to what he thought I might need some assistance in when dealing with his point of order. Now the Minister is taking a point of order, I imagine, on that. If the Minister has a point of order-- Mr Beazley —My point of order on that is that an appropriate time for a debate about relevance is on a motion about it. Mr ACTING SPEAKER —Order! The Minister does not have a point of order. I call the honourable member for O'Connor. Mr Tuckey —Thank you, Mr Acting Speaker. In bringing these authorities to your attention, I would like to quote no less an authority than the Governor-General designate, who will shortly be issuing you with your warrant-- Mr ACTING SPEAKER —Order! The honourable member might get to his point of order. Mr Tuckey —Yes. He said: Question Time and much of the parliamentary procedure becomes a low farce if questions are not answered by Ministers. Mr ACTING SPEAKER —Order! The honourable member for O'Connor is now arguing a point rather than taking a point of order. Mr Tuckey —No, I am not. I am putting to you the authorities on this matter-- Mr ACTING SPEAKER —Order! What is the basis of the honourable member's point of order? Mr Tuckey —My point of order relates to relevance, and I need to draw your attention to another authority, because we have one no less than the Treasurer, when he was, of course, a shadow Minister. On 30 April he said: I raise a point of order, Mr Speaker. The Standing Orders provide that an answer shall be relevant to the question. I draw your attention to the important part of that exchange. The Speaker then said: Order! The Treasurer will draw his answer to a conclusion. In other words, the point of order was acceptable. My final point of these points of order and the authorities I give you deals with the words of no less than the Prime Minister, when he was simply the member for Wills. He said `I raise a point of order, Mr Speaker. What sort of double standards are you allowing in your ruling? You are allowing him to get away with murder'. Mr ACTING SPEAKER —Order! Mr Tuckey —I think we are getting to the nub of the situation. Mr ACTING SPEAKER —Order! The honourable member for O'Connor is taking a point of order on relevance. The Chair has said previously in this discussion that its view is that the Prime Minister is answering the question. I now call the Prime Minister. Mr Tuckey —I am sorry; the question of relevance-- Mr ACTING SPEAKER —Order! The honourable member for O'Connor has taken a point of order. I have ruled on his point of order. The Prime Minister is relevant to the question. Mr Tuckey —I would refer you to the advice of the Prime Minister-- Mr ACTING SPEAKER —Order! The honourable member for O'Connor will resume his seat. I call the Prime Minister. Mr HAWKE —I can quite quickly draw the agony of the Opposition to a close, because I understand that it does not want too much exposure of the problems it has on that side of the House about leadership. I simply point out that theirs is a problem of three Johns. They have John Stone in the upper House, who has said that the leader in this House commands no respect. John Howard, in this House, is a person who is here by default. The Liberals cannot find anyone to replace him. That is how weak they are in the collection of talent behind them. They have the John in the upper House, the John in this House and, of course, outside they have John Elliott, who despises the Federal parliamentary leadership of this place and who would like to see this John moved from this House so he could move in. So their problem is that they have no policies and they have no leadership. While they have no policies and no leadership, they will remain on that side of the House. The fact is that the policies and the leadership of this Government have provided a situation which, as I have had cause to say, has caused the leader of the International Monetary Fund to hold up the economic management of this country as a model for the rest of the world, as well he might. Mr WHITE —My question is directed to the Minister for Defence. Is it a fact that the British Government asked that, if HMS Edinburgh was docked for repairs in Australia, the Australian Government would guarantee that the ship would be refloated? Why was this guarantee not given? Is this the reason why there was no formal request by the British Government to dock HMS Edinburgh? Mr BEAZLEY —The answer I gave to this question in the House is complete as far as we are concerned. If the Edinburgh-and it has still not left our waters-finds itself in trouble at any time-- Mr Andrew —This was when the request was made. It has to be in trouble first? Mr BEAZLEY —The honourable member would know that ships require docking when they are in trouble, but they do not when they are not. It becomes relevant should the Edinburgh find itself in circumstances where it cannot proceed. We have said to the British Government that if it requires docking it will be docked and we will ensure that the ship is docked properly and released. Mr White —Mr Acting Speaker-- Mr ACTING SPEAKER —The honourable member for McPherson has a point of order? Mr White —My point of order is that the answer was not relevant to the question that was asked. Mr ACTING SPEAKER —Order! Mr SIMMONS —Can the Minister for Primary Industries and Energy advise the House of the implications of the Government's decision to change the pricing arrangements for liquefied petroleum gas (LPG)? In particular, can the Minister indicate whether local government gas supply authorities in New South Wales have any reason to be concerned by the changed arrangements? Mr KERIN —Last Tuesday the Prime Minister announced the Government's decision to change the current arrangements governing wholesale LPG prices. Under the new system the maximum basic wholesale price of LPG will be determined by the Prices Surveillance Authority (PSA). This will put LPG pricing on the same basis as that of other petroleum products. More significantly, it will remove the rigidities inherent in the current arrangements. Like so many of the regulations imposed by the previous Government, the current LPG pricing arrangements are a disincentive to production and investment. By allowing the PSA to take all relevant factors into account, the Government will remove the current disincentive to investment in the infrastructure that will be necessary to meet expanding domestic demands. It will also remove the disincentive to LPG production in general and the mismatch in the pattern of supply and demand between propane and butane in particular. There are two important features of the arrangement that I want to stress. Firstly, export controls on LPG will be retained subject to review after 18 months. Controls will apply only if problems emerge in supplying domestic markets, otherwise Australians producers will be able to export LPG under automatic annual approval. Of course, the Government hopes that it will not be necessary to intervene through export controls but it will do so if supply problems emerge. Secondly, in addressing very directly the question of the honourable member for Calare, the continued price control by the PSA will ensure that consumers, particularly small consumers in the transport and domestic sectors, are not disadvantaged by the exercise of market power by producers. Consumers can be assured that they will be paying no more than the proper economic price for LPG. This is a balanced decision, consistent with the aims of protecting consumers and providing appropriate incentives for production and investment. It will be to the long term benefit of all concerned. Like so many other decisions this Government has taken, it stands in stark contrast to the previous Government's record of ad hoc counterproductive regulations. Mr PEACOCK —My question is directed to the Treasurer. We welcome him back, far more than the fellow at the table does, I am sure. Is it a fact-the honourable member opposite should not put on the fabricated grin-as published in the Melbourne Herald-- Honourable members interjecting- Mr PEACOCK —The discomfort is obvious. Mr ACTING SPEAKER —Order! The Deputy Leader of the Opposition might get to his question. Mr PEACOCK —Is it a fact, as published in the Melbourne Herald today, in an article by Terry McCrann, that `anything less than $25 a week in tax cuts would leave most taxpayers worse off' than when Labor came to power? Mr KEATING —The answer is no. Today we see an amazing article in the Melbourne Herald. First, having relinquished a position of some prominence as a commentator for the more comfortable isolation of the Melbourne Herald, Mr McCrann now needs to have his paper advertise his columns before anyone will read them-and not only that, but extensively advertise this column. He has disappeared to such a degree that a major advertising spree is needed for him to be at all noticed. The second thing he does is take the bat to the Canberra Press Gallery, stating in the article: Rhetoric and bluster might be able to convince the journalists in the Canberra press gallery . . . He goes on to talk about how much other people understand. He argues on the basis that he alone understands the concept of fiscal drag; that no enlightened person in the Canberra Press Gallery does. Not only that, but that the Prime Minister and I have been cheating the nation of income. The whole analysis is flawed and wrong. It is flawed on the basis that it is not fiscal drag if a person's average tax rate increases because his income increases. It is not fiscal drag because people have a higher income. Mr McCrann has taken the tax ratio of tax paid to taxable income, and compared that ratio, which he projects to 1988-89-he does not have any data for it-with the ratio for 1982-83. But he ignores, for instance, the fact that in 1982-83 there was a drought and farm incomes were at very low levels. Mr Tuckey —He has just discovered the drought. Mr ACTING SPEAKER —Order! The honourable member for O'Connor will cease interjecting. Mr KEATING —In a year when production was higher, for instance, a farmer would have an increase in his or her tax ratio. Of course he would, because there was more income. Under the progressive tax system, if a person has more income, he pays more tax. But by dividing the tax paid by the tax payable Mr McCrann has sought to imply a ratio that all of that represents fiscal drag. It does not; it represents higher income from more people being employed and those people having higher incomes. On top of that, he makes another conceptual mistake. He stated: Importantly also, it can't be explained away by revenue-raising moves against tax avoidance, or widening the tax base, as that by definition produces a higher taxable income figure. This is the claim in his article. That is wrong. The fact is that we have made the tax cheats pay, particularly rich tax cheats. The ratio of tax paid to taxable income is higher because more people are paying their fair share of tax. The Prime Minister and I are not cheating the electorate; we are making other cheats pay. The arrogance of the situation is such that we have this massive advertising campaign about a series of articles which are entirely flawed in their conceptual analysis. He bags the Canberra Press Gallery and then seeks to lift his profile as an economic commentator. I conclude on this point: I was at a lunch with Mr McCrann and News Ltd executives earlier this year. He was seeking to display his knowledge by leading the band at this News Ltd discussion. I said, `Listen, Terry, before you open your mouth, let me make this point: you are a marked man; you are a Liberal; you support the Liberal Party'. There was no rebuttal and no defence. This Government has restructured the Australian economy, as the Prime Minister said, made it a market economy, floated the exchange rate, removed exchange controls, changed the financial system, run a big deficit down to a surplus and cut outlays, but there has not been one commendatory note from Mr McCrann, who is just a partisan sitting in a highly paid backwater in the Melbourne Herald and who is conceptually wrong. Mr RONALD EDWARDS —I direct a question to the Treasurer. As a result of his recent attendance at the annual meeting of the International Monetary Fund and meetings with world financial leaders, will the Treasurer inform the House of the current state of the world economy and the implications for Australia? Mr Tuckey —How many people listened to the IMF speech? Mr ACTING SPEAKER —Order! The honourable member for O'Connor will cease interjecting. Mr KEATING —I am pleased to report that I found the meetings and engagements which I attended recently with the International Monetary Fund and the World Bank considerably upbeat in their nature. People thought this burst of growth-- Mr Shack —People back here-- Mr KEATING —In some parts of the world people take the debate seriously. I know that Play School has been in here for a few weeks with the lot opposite. I thought of buying them some blocks, as I came through Singapore, to play with on the carpet. Mr Tuckey —How many people came to listen to the IMF speech? Mr ACTING SPEAKER —I warn the honourable member for O'Connor. Mr KEATING —The fact is that the world economy is continuing to grow well and there is a view around the world that, although we have had six years of continuous growth and now, at the end of that period, some attendant rise in inflation, that growth ought to be maintained. That is a view held by the people representing the major economies. The fact is that the world economy is continuing to grow well. Gross domestic product (GDP) was up 3 3/4 per cent in 1988, with world trade growing by 7 per cent, which is the strongest rate of growth in recent times. Of the major economies, Japan is growing strongly. The Japanese Government has turned around the balance of its economic policies to support domestic demand, now rising by 7 per cent, which has pumped its GDP growth along to a forecast 5 3/4 per cent. So the second major economy is growing very strongly indeed. The balance of that growth is good in terms of running down international trade imbalances. The United States economy is growing close to 4 per cent in 1988, while growth in Germany has picked up to around 2 1/4 per cent. Underpinning that general buoyancy in general activity in the majors, the commodity price outlook continues to look solid. That is a view supported by most major country finance Ministers and trade Ministers. Trade is up, the stock position-that is, the stock to sales ratio of major commodities-is much better, and the outlook for bulk traded commodities is particularly better, especially for iron ore and metalliferous coals. So, as I said before, all in all there was an acceptance of the view that there is no need to stop growth after six years and, although monetary policy slackened following the October stock market crash, inflation has moved up moderately in some countries and monetary policy has accordingly been tightened. But there is a willingness on the part of governments around the world to maintain policy flexibility, to keep their economies growing. However, there are some risks. I think one of the risks continues to be the United States-- Mr Tuckey —Mr Acting Speaker, I raise a point of order. It concerns the wasting of Question Time. This is very interesting-- Mr ACTING SPEAKER —Order! Does the honourable member for O'Connor have a point of order? Mr Tuckey —Mr Acting Speaker, my point of order relates to the fact that the Treasurer's answer would be more appropriate in the form of a statement. Statements are down from about 60 to 20. I ask you to ask the Treasurer to do so. He might also tell us how many people listened to his IMF speech. I counted 10. Mr ACTING SPEAKER —Order! The honourable member for O'Connor will resume his seat. Mr KEATING —As I said, there are some risks. The United States deficit is still too high. There is too much weight put on monetary policy in the United States, which means that the attendant interest rate increases are spreading to the Third World debt. The fact is that a lot of these countries are not getting the growth in trade that one would have assumed as a result of this growth over six years. Obviously, if United States interest rates are rising, that is a burden for those with United States denominated debt, many of which are developing countries, and that contagion in interest rates spreads around the world. We have again made the point, I think reasonably, as other governments did, that we would like to see more balance in the United States economic policy. Overwhelmingly, the reaction to Australia is now the belief that it is one of the most flexible countries in the world. As the Prime Minister said earlier, we have got the public sector borrowing requirement to zero. That almost marks us out as unique among the Organisation for Economic Cooperation and Development countries. The rate of tax changes here, both by their quality and size, is well noted. In particular, our system of full dividend imputation is a world first and is coming under much notice. The change in tariffs, the financial market deregulation, the reduction in real unit labour costs, employment growth tapping the full potential of our work force, strong levels of investment-a forecast 12 per cent this year following 10 per cent last year-and all of these structural changes are being noted as ones which make the Australian economy much more flexible. So the point is that Australia is now better placed to face whatever happens in the world economy but we see the world continuing to grow as strongly as it has in the last few months. We are getting out of the debt habit. We have a surplus of $5.5 billion. While overseas I announced the repayment of $1.5 billion, on top of the $700m in Tokyo. We will repay $3 billion of overseas debt this year and $2 billion of domestic debt, which is a permanent saving in public debt interest in terms of the Budget. Between 1975 and 1983-that is on the part of the former Government-net overseas raising was $4,488m. Between 1983-84 and this year we will have repaid $1,310m. We are now repaying the debt which the former Treasurer, who is now the Leader of the Opposition, and his colleagues ran up as a government between 1975 and 1983. It is noticed that we are repaying debt. It went all round the International Monetary Fund and the international banking community that we had repaid Swiss loans, that we had repaid yen denominated debt recently and that we have a program of debt repayment. It is also noted that Australia has a much more flexible approach to economic policy and to its economy and hence there is a lot of interest in what we are doing and how we have done it. I must say that at the end of the visit and the round of talks the outlook for commodity prices remains pretty good and the prospects, therefore, for our current account and for continuing growth in the world look, as I said in the beginning, generally upbeat. Mr TUCKEY —I, too, have a question for the Treasurer. During the no doubt extensive briefings he provided the Acting Treasurer and Keating for Prime Minister Campaign Manager, Mr Dawkins, prior to the Treasurer's departure for the International Monetary Fund did he discuss with the Acting Treasurer his advising the Prime Minister to resign? Mr ACTING SPEAKER —As I ruled last week, questions to Ministers about matters that do not relate to their portfolios are out of order. Mr Tuckey —On a point of order: surely the macho Treasurer is not going to hide behind the Speaker as well? Mr ACTING SPEAKER —Order! The honourable member for O'Connor will resume his seat. Mr Keating —Mr Acting Speaker-- Mr Howard —He is on his feet. Mr ACTING SPEAKER —I call the Treasurer. Mr KEATING —The only leadership problem in this Parliament is on the other side of the House. The position in our Party is quite clear. My friend and colleague the Prime Minister will remain Prime Minister for as long as he chooses, but that is not the case on the Opposition side. Over there there is a major debate about the incapacity of the Leader of the Opposition to cut the mustard electorally. He has now got that sheepish grin back on again. I know he is embarrassed. I noticed that one of his comments was that I ought to get out of public life. I bet he wishes I would because, brother, I said to him a couple of years ago, `Whenever you look behind you I will be there'. I have stuck to that and I have been there. I was there when his Box Hill tax release had a $1,500m hole in it. I was there when he took his place as Leader of the Opposition for another three-year Parliament. I will be there when he brings down the tax policy he promised for August, which has now passed-the tax policy which he says will give Australians a fairer share of their national income. The fact is the Opposition is unled. The Leader of the Opposition is a joke abroad. I followed him around London and New York. He is regarded with contempt and scorn in the financial market. People ask: `How can a party which governed for so long now be so conceptually weak?'. People were polite to him because they were sorry for him on the basis of his plea and his analysis. On the other side of the House, as we know and as I have said in this House before, there is a-- Mr Spender —I raise a point of order, Mr Acting Deputy Speaker. We were glad that the Treasurer got up and proffered himself when you ruled the question out of order, but what we would like him to do now is to answer the question and tell us what instructions he gave to his mates. Mr ACTING SPEAKER —Order! There is no point of order. Mr KEATING —The Prime Minister and I feel cheated. We have blown a hole in the Leader of the Opposition on so many occasions that what we have is a dead carcass swinging in the breeze, but nobody will cut it down. It is still hanging there, because there is no one to take its place. Fancy sitting in public life and saying, `This is the morality of my position as Leader of the Opposition. I am here because there is nobody to replace me'. There was the most damning indictment of the Leader of the Opposition as Treasurer-and this is his capacity to fashion policy, drive it through and to govern-then by the now shadow Minister for finance. I will read this quote from the Australian Financial Review of July 1987. It reads: We played quite a significant role in opening up the debate. We had success at the margin but the whole thing was the big decisions were not taken . . . the consumption tax, industry protection levels, fiscal policy restraint measures . . . It was very frustrating. Howard would get rolled. Cabinet Ministers would sway the debate on the basis of an anecdote in the non-members' bar the night before, even if we had four feet of paper on the table . . . The farmers could produce anecdotes out of the air. I used to wonder a lot how much many of them understood. The decisions were made when we (the advisers) were kicked out . . . Having been there during the Fraser years and been decisively rolled- that is, Mr Howard- he knows that if you have the chance to do something, you just have to do it. What a damning indictment of the performance of the former Treasurer, now Leader of the Opposition. Of course, he has no more control over the current Opposition and its policy than he had as Treasurer of this country in the Cabinet that he served. I conclude on the point that there is only one problem with leadership in this nation and it is on that side of Parliament with the Leader of the Opposition, with poor old Sinkers, who is dead, but someone forgot to tell him; hapless Bruce is sitting around-good on you, Bruce-sticking in there supporting him and doing the right thing; and Andrew is looking over his shoulder-- Mr ACTING SPEAKER —Order! The Treasurer might refer to members by their title. Mr KEATING —Andrew is looking over his shoulder, wondering whether he will be called, whether the souffle can in fact rise twice. Then we have a new bit player, a meretricious player entering the scene, in the former adviser, who, along with the former Treasurer, destroyed a nice middle sized Organisation for Economic Cooperation and Development economy. Here they are, back arguing amongst themselves about who should lead Australia. The argument will be settled again at the next election as it was at the last. Mr CROSS —Is the Minister for Defence aware of remarks by the Opposition spokesman for defence about the proposal to relocate major elements of the Army to Darwin in which he said that moving a brigade to Darwin was not a priority for coalition defence policy? Are the Government's plans to relocate army units to Darwin proceeding? Mr BEAZLEY —I have seen the comments to which the honourable gentleman refers. As I recall the comments, the Opposition spokesman said that a higher priority than shifting a brigade to Darwin would be to provide additional resources to the already substantial maritime resources that exist for the Army to intervene elsewhere. As far as we are concerned on this side of the House, like the tax policy, we await with bated breath the Opposition defence policy-which has now been 5 1/2 years in coming. Snippets appear every now and then about what the Opposition might do, but nothing coherent appears. That is not surprising because the snippets that do appear tend in general, except in this instance, to involve expenditures of more money, and in this instance the trade-off on the expenditure of more money is to buy additional amphibious capability for the Army, which already has a very substantial amphibious capability indeed. What we have here is a situation where the Opposition is rudderless in its defence policy, as it is rudderless everywhere else. Perhaps part of the reason for that is the extraordinary position of the Opposition, unprecedented in this country, of not putting its shadow spokesman in the Cabinet. We have had several Cabinet changes on the Opposition front bench since the current incumbent in the shadow defence portfolio was appointed. We are well beyond what might have been a period of grace for training, although I recollect that he was a shadow Minister before he was appointed to the defence area. The Opposition loves to wrap itself in the flag on defence. It loves to take the high ground and make statements that are holier than thou as far as this side of the House is concerned: this side of the House is the only one to produce a coherent defence policy since the early 1970s. What we get from the Opposition is such a level of priority as far as defence is concerned that it appoints two outer Ministry people to run the portfolio. The Opposition should not think that that point is not noticed by the armed services and by our allies and others who have an interest in our defence policy. They note it; they comment on it to me frequently. It is clear that there is a downgrading of the Opposition's position on defence. No wonder, when we see the sort of dross that emanates from the Opposition shadow spokesman. The Opposition could not put him anywhere near a position where his promises on an area of expenditure might be regarded as having any credibility. Fortunately in this area he has no credibility either. The shifting of our armed forces to the north, which is a policy of this Government, is a commonly recognised essential step in establishing the proper disposition of forces for defence self-reliance in this country. It has hitherto been a point not disagreed on by any sensible commentator on the requirements of the defence of this country, except apparently-and, I might say, daringly-in Darwin by the Opposition defence spokesman, who ignored the fact that we have a substantial amphibious capability in the Tobruk; ignored the fact that we have a substantial amphibious capability in the LCHs; ignored the fact that we have a substantial amphibious capability in regard to the ways in which we might use Stalwart and Jervis Bay; and ignored the fact that amphibious capability is not all that is essential if we intend to send forces elsewhere. If we decide to do that from time to time, we have a substantial airlift capability in our defence forces. The Opposition spokesman ignored all of that and said that we would scale down the movement of our forces to the north. I recollect that in the last election campaign he was fairly disparaging of the notion of priority for shifting them to the west as well. The Opposition has no defence policy. It has had 5 1/2 years to devise a defence policy; it has no respect for the portfolio. For some 12 months it has refused to give Cabinet status to its Opposition shadow spokesman on defence. It is a disgrace. It has no policy in this area, as it has no policy in any area. Mr PETER FISHER —Is the Minister for Social Security aware that 15 farming families per week are leaving the land in Victoria and 4,680 farms have been lost during the last six years? Is he aware that rural unemployment in this same six years has increased by 90 per cent from 25,100 to 47,800? In view of these tragic statistics, why has the Government discriminated against the rural sector and rural children in eligibility for social welfare assistance and education assistance? Why has the Government abrogated its responsibilities to the rural unemployed? Mr HOWE —I know of the honourable member's concern for disadvantaged people in the Mallee. Opposition members interjecting- Mr HOWE —The idiots on the other side should shut up for a moment. Occasionally we see reflected on the back bench of this Opposition a bit of genuine concern for people. The reason we do not get policy emanating from the Opposition, as other members have said, is that ultimately all this Opposition is concerned about is power. As soon as an honourable member asks a serious question about his electorate we get this yakking. Mr Sinclair —Why don't you answer it? Mr HOWE —I would find it absolutely extraordinary if the Leader of the National Party had ever shown the slightest concern for anyone poor in his electorate. He is much more concerned about his cheque book than about anyone in his electorate. Mr Sinclair —Stop this idiocy. The fellow is a buffoon. Mr ACTING SPEAKER —Order! The Leader of the National Party will cease interjecting and the Minister will be able to be heard by the chamber. Mr Howard —Did you hear what he said? Mr ACTING SPEAKER —The Leader of the Opposition will also cease interjecting. I call the Minister. Mr HOWE —I will ignore the leaderless front bench and concentrate on the question raised by the honourable member for Mallee. My knowledge is restricted to the level of unemployment benefit: I cannot talk about overall employment. However, Victoria has had an extraordinary record against the rest of the Commonwealth in reducing unemployment and the number of people on unemployment benefit in both metropolitan and rural areas. There has been a quite dramatic improvement in the management of the Victorian economy, particularly the rural economy. Many of the problems that did exist in the Mallee, about which I and the honourable member were certainly concerned, are much less serious than they were some years ago. I leave it to others to refer to the improvements that have occurred, particularly in the wheat industry, in recent years. This Government has given considerable priority in social security to support for families. In terms of the introduction of the family package, overwhelmingly the benefits of that package have gone to people in non-metropolitan and rural areas. Wherever one looks-at any State-the take-up is more substantial outside of cities. Thousands of families in the north-western part of Victoria, if they happen to be excluded from the work force, have benefited from increased assistance for the unemployed and sole parents. Certainly, low income working families will have achieved substantial improvements in their income. Again I refer only to my own portfolio, but honourable members will be aware that the benefits of the vast improvements in educational assistance, particularly Austudy, have been substantial. Behind the honourable member's question is a concern that the Government, in terms of its commitment to targeting and to assisting those who are worst off, will introduce measures, in relation to both Austudy and the family allowance supplement, to see that people with very substantial assets do not receive those payments. Of course, that involves a difficult decision. I understand the honourable member's concern, but that reflects the difference between the Opposition and the Government. In tightened economic circumstances when there is not enough money to go around, when we are confronted with a choice, we are prepared to make that choice. This Government, together with the Victorian Government, has had a magnificent record in managing the economy and in minimising the impact of structural change on low income families. I know that the former Minister in Victoria, Mr Walker, visited the Mallee on many occasions and worked to ensure that those pains of structural change were minimised. That is the difference. That is why the Victorian Government was re-elected-because it was economically rational and socially responsible. We should get a bit of that from the other side of the House rather than meaningless cackling and endless points of order day after day. This Opposition is the most hopeless opposition we have ever seen on the other side of the House. It knows one point in the Standing Orders and little else. Mr Blunt —Mr Acting Speaker, I rise on a point of order. I do so belatedly because I thought you would have corrected the Minister. In his answer to the question he used terms which I found unparliamentary and offensive. I ask that you ask him to withdraw them. Mr ACTING SPEAKER —In listening to the Minister I understand that he said that a member of the House showed no compassion and was more interested in his cheque book, which I took to mean that the member was more interested in his own money than that of others. I see nothing unparliamentary in that. Mr Sinclair —Mr Acting Speaker, on a point of order: I take strong exception to your winking at the Government immediately after that last response. I regard it as offensive and I regard your behaviour as totally unsuited to somebody who is temporarily sitting in the chair. If that is the manner of your behaviour, you bring no respect to this House. I think if you are going to act with any measure of impartiality not only should you call on the Minister to apologise but also you should apologise to me and to this House. Mr ACTING SPEAKER —Order! The Leader of the National Party should not draw any inference from the fact that I could or could not have been winking at anyone because I certainly was not. If the right honourable member feels that I was affronting him, I most certainly was not. I certainly meant no offence to him. I was not winking. Mr DUBOIS —Is the Minister for the Arts and Territories aware of the proposal by the coalition shadow Minister to abolish the Australia Council? What would be the effect on arts funding if the Australia Council were to be abolished? Mr Spender —I take a point of order, Mr Acting Speaker. You will recall that Standing Orders provide that a question shall not contain hypothetical matter. The honourable member is asking, `What will be the effect if . . . '. If that is not hypothetical, not a damn thing can be in this place. Mr Tim Fischer —Mr Acting Speaker, further to the point of order, standing order 144 says that a Minister cannot be asked for an expression of opinion arising out of the framework of a question. The question is clearly asking for an opinion and it should be ruled out of order. Mr ACTING SPEAKER —The honourable member, as I understood it, was asking the Minister what would happen in his portfolio area. The Minister is able to comment on what would happen in his portfolio area. I call the Minister. Mr HOLDING —I thank the honourable member for his question about a matter which has already caused grave concern to those very many people who rely on funding from the Australia Council. There are two aspects to the question. The first, of course, is the political aspect. Any Minister for the arts who adopted a policy of abolishing arm's length funding would create a situation which has been described by probably Australia's most distinguished playwright, David Williamson, as getting dangerously close to the Eastern European Minister of culture model in which everything embarrassing to the regime in power has to be eliminated. That, of course, would be the situation if a Minister-not necessarily the present shadow Minister for the arts-said, `All the questions and all the detailed applications for funding will have to come before me and I will be the final arbiter. I will be the gauleiter for the arts'. The honourable member for Lalor will well recall that when he and I were both members of the Victorian Parliament the then Victorian Government got involved in banning what was a fairly bold book called The Group. Of course, it became a political issue. The then Chief Secretary, in order to defend himself, had to read out all the spurious pieces, which upset him. It was a somewhat turgid response. The sole result was that Hansard that week was an absolute sell-out. The other aspect of it is this: there are more than 6,000 individual applications for funding. In this situation, if we allowed the Minister some 20 hours a week-I think that would be an excessive figure-to process those applications and to make decisions on them, he would be making a decision at the rate of one every 10 minutes. Of course, that is totally absurd. But the Minister would probably say, `We will rely on some expert committees'. We can just imagine that. We would have Senator Flo Bjelke-Petersen and Senator Walters representing the moral aspects. They could give the Minister advice on moral judgment. The honourable member for O'Connor could provide advice on literary content. Mind you, it would put a strain on young novelists. They would have to submit all their manuscripts in cartoon form, with pictures, so that he could understand them. Mr ACTING SPEAKER —Order! The Minister will answer the question. Mr HOLDING —The actual policy that is being advocated-- Mr Spender —Mr Acting Speaker, I am making a simply inquiry. What sort of pigsty are you allowing this place to turn into? Mr ACTING SPEAKER —Order! The honourable member for North Sydney-- Mr Spender —If they turn this into a comedy and you are an accomplice to it, you should not be there. Mr ACTING SPEAKER —Order! The honourable member for North Sydney will not reflect upon the Chair and he will resume his seat. I call the Minister. Mr Spender —Are you going to pull him into line? Mr ACTING SPEAKER —Order! Mr Spender —Did you not hear what he said? Mr ACTING SPEAKER —Order! The honourable member for North Sydney will resume his seat. I have asked the Minister not to cast reflections upon other members and to answer the question. Mr Spender —It took you a long time to get there. Mr ACTING SPEAKER —I was doing that prior to being interrupted by the honourable member for North Sydney. I call the Minister. Mr HOLDING —I simply want to make this point: this arts policy is like every other so-called policy document that has emanated from that side of the House. It is without thought, without detailed knowledge and without any understanding of what is occurring in this very important area. It is extraordinary that a party that says it believes in the freedom of the individual wants to develop arts in a way which would destroy the capacity of young Australian artists. It does not matter what area they are operating in, the final judge would be whoever might get up at some time-in the long distant future-who would be making political and moral judgments about the content of their art work. As has been pointed out by one of Australia's greatest playwrights, it would take us back into a field which is outside the framework of Australian tradition and place us in the position where we have a political gauleiter who says, `Every single decision in arts funding will come through me'. It is a nonsense policy. It will not work and it shows in yet another very important area what a lamentable bunch of people we have trying to formulate an alternative policy for the people of Australia. Mr HOWARD(Bennelong-Leader of the Opposition) —Mr Acting Speaker, could I raise with you a matter relating to the conduct of the House, particularly during Question Time? Mr ACTING SPEAKER —Most certainly. Mr HOWARD —I remind you that on 20 February 1986 Madam Speaker, following a series of personal exchanges in this House involving members on both sides of the House, made a statement and drew attention to her concern about aspects of that behaviour. She said, inter alia, in that statement: . . . I will not tolerate, from either side, allegations or imputations of a personal nature, particularly remarks or interjections which go into the private lives of members. I think it is fair to say that at that time her ruling, in her admonition, drew support from both sides of the Parliament, and it would certainly still be my view and, I believe, the overwhelming view of the majority of my colleagues, that that ought still to be the case. During Question Time, the Minister for Social Security (Mr Howe), who has just concluded his answer, made a reference which quite clearly was to certain proceedings years ago involving the Leader of the National Party (Mr Sinclair). In those particular proceedings, as you, Mr Acting Speaker, and others in this House know, the right honourable gentleman was totally cleared of any blame or criticism by a jury of 12 of his fellow Australians. The Minister for Social Security still thought it fit to refer to the matter. All I say to you and to honourable members opposite is that that ruling, that request, made by Madam Speaker was a sensible request but it has to be honoured on both sides of the House. If it is not honoured on the Government's side of the House, you cannot expect it to be honoured on this side of the House. I regard it as a failure of your responsibility not to have instructed the Minister to withdraw what he said. Mr ACTING SPEAKER —As I said to the honourable gentleman on my left who took a point of order earlier, I genuinely understood that the context of what the Minister for Social Security (Mr Howe) was saying did not relate to that. However, if the Minister was referring to another matter, I believe that he should withdraw and I insist that he withdraw. But my understanding was that the Minister was not talking about it in that context at all. The Minister for Social Security might like to clarify that matter for the House. Mr Howe —In the exchange I made some reference to a cheque book but was not relating it to the circumstances as referred to by the Leader of the Opposition. Mr GRIFFITHS(Maribyrnong) —Mr Acting Speaker, I wish to make a personal explanation. Mr ACTING SPEAKER —Does the honourable member claim to have been misrepresented? Mr GRIFFITHS —Yes, I do. Mr ACTING SPEAKER —The honourable member may proceed. Mr GRIFFITHS —On the Sunday Face to Face program I referred to a request in this chamber by the Deputy Leader of the National Party for a parliamentary inquiry into matters associated with the organisation known as the League of Rights. As honourable members would be aware, I should have referred to the request made by the former Deputy Leader of the National Party. To the extent that the existing Deputy Leader of the National Party in Australia (Mr Lloyd) may have been inundated with phone calls, I apologise to him. Mr Campbell-Mr Acting Speaker, I draw your attention to the state of the House, in particular, the bogong moths. While I recognise that they are a part of our culture which some people would like to cherish, it seems that the moths which are in the House now are doomed to die. I think it would be better if we could hasten their death and get this House cleaned up. Mr ACTING SPEAKER —The officers of the Department are doing their best to overcome the difficulty caused by the moths. Mr Carlton-With regard to the same point made by the honourable member for Kalgoorlie, who drew attention to the state of the House, there is in fact a quorum of moths in the House. Mr ACTING SPEAKER —Madam Speaker has received a letter from the honourable member for Flinders (Mr Reith) proposing that a definite matter of public importance be submitted to the House for discussion, namely: The difficulties created for industrial relations by the careless rhetoric of the Prime Minister on tax cuts and wages. I call upon those members who approve of the proposed discussion to rise in their places. More than the number of members required by the Standing Orders having risen in their places- Mr REITH(Flinders)(3.08) —I say to the people in the audience in the gallery: You have just witnessed a fairly typical Question Time in the House of Representatives. One of the last Ministers to answer a question was the Minister for Social Security (Mr Howe). His line was that he had a monopoly on compassion. What was interesting was that, as is typical of the Australian Labor Party, we heard nothing about the rich getting richer and about those in the Labor Party who have their snouts in the trough. The other thing that is interesting is that the Treasurer (Mr Keating) is back. Before he fell into his usual routine he struggled to get over the words of support for the Prime Minister (Mr Hawke). His usual routine was to abuse somebody-heaps of personal abuse-and then out came a load of arrogance. I just say to you, Mr Acting Speaker, that the reaction basically from this side of the House is simply this: whilst we are not going to sit here and take the sorts of responses that we have had from the Government today, in the end it will count for nothing because this Government is simply out of touch. I do not think the Treasurer understands that, whilst he was away, the people of Oxley had a message to send to his Government. In fact, Mr 38 per cent came in here with a message in his back pocket for the Prime Minister and the Treasurer. The reality is that there is a great change of mood in this country today. Honourable members will not read of it in the newspapers or hear of it on the electronic media, but they might pick it up in the talkback. People are saying to this Government, `We no longer believe you. We no longer trust what you have been telling us as to the situation in this country today'. The Treasurer can claim to be the world's greatest Treasurer. It is infectious. We even had the leader of the Australian Council of Trade Unions yesterday say that we had the world's greatest trade unions. Those opposite can say that till they are blue in the face, but nobody will believe them because the penny is starting to drop. People are asking themselves, `They have been in for 5 1/2 years; am I any better off?' Of course, the answer is to be felt in their hip pockets. That is what is happening. That is why we have people such as the Minister for Employment, Education and Training (Mr Dawkins), the Treasurer and other senior Ministers wanting the Prime Minister to get out. They realise that the country is starting to wake up and starting to realise that much of what is being put to them by the Prime Minister in particular is phoney. When it comes to managing the main game, the Prime Minister is off on another agenda. We can understand the resentment that has been building up between those senior economic Ministers. If honourable members listen to the Treasurer, he will tell them that he sticks to the main game. The last thing that he wants is a Prime Minister diverting from the agenda set by the Treasurer and his campaign manager, the Minister for Employment, Education and Training. They look at the Prime Minister and say to themselves, `Here is a bloke who will say absolutely anything to suit the political convenience of the time'. Look at what was said in the electorate of Oxley. He talked his head off and said that the good times are here and the good times are coming-all as a result of his performance as an economic manager. Let us look at his policy and his basic strategic position for the next election. He says, `There will be tax cuts. You ought to be grateful for what we have given you'. Everybody knows the reality of the tax cuts. I will refer to them in a minute. The Prime Minister simply wants a fourth term. That is his agenda and nothing is to stand in his way. There really is a growing concern with people such as the Treasurer. Why? It is because they have seen it all before-the build-up of expectation as part of a simple political strategy by the Prime Minister. Let us go back to the by-elections that were held for the seats of Adelaide and Port Adelaide earlier this year. One interesting thing that came out of that was a decision in the strategy corridors of the Government to start to build up a situation, a claim, that the hard times, those wartime conditions once referred to not so long ago by the Prime Minister, were now over and that, thanks to the Prime Minister, the good times were coming. One of the real implications, the bottom line implications of the build-up of expectations earlier this year, came in the national wage case in August 1988. Let me read what was said in that decision: In the light of our appreciation of the economic situation, we think that the wage increases allowed by this decision are the most that we can responsibly grant. Let me come to the crunch: There would be significant economic benefits in lower increases, but we acknowledge the force of the non-economic concerns which have a contrary implication. That might be doublespeak, but the reality is that the Full Bench said: `Look, we had some by-elections earlier in the year in Adelaide and Port Adelaide'. The Government has been talking up expectations as to what people are going to get in their pockets and, as a result, the reality is that the force of the non-economic concerns has a contrary implication. So we had a build-up to the 3 per cent wage increase and the $10 increase at the national wage case in August this year. So it is that people such as the Treasurer and his campaign manager are very concerned, and properly so, that whilst the Prime Minister has been promoting expectations, the ultimate consequence of that will be a non-economic concern having an impact on the broad economic strategy that the Government is attempting to pursue. The Prime Minister has adopted a very simple line: the hard times are over; let the good times roll on. Of course, we all know that the stark facts are otherwise. Let us look at tax. We would need $56 in our pockets just to put us back where we were in 1983. We have heard the abuse today but, of course, no real response-there is none-to Terry McCrann's comments in today's Melbourne Herald. In his article entitled `The great tax grab', Mr McCrann says: Paul Keating has presided over the biggest tax grab by any Treasurer in any government in this country's history. Look at the sharp reality for millions of Australians as a result of Labor's economic policy. The article continues: More than two million taxpayers have been pushed into the top two tax brackets since 1982-83, and by the close of this financial year a staggering one million of these will have ended up in the top bracket. Even somebody with taxable income of well below the average weekly male wage is now in that second highest bracket-facing a tax rate of 41.25 per cent on every extra dollar of income. Once you hit a taxable income of about $1500 a week you are better off than a comparable taxpayer in 1982-83. The Government is hitting those people in places such as Oxley. That is the message from the people of Oxley. That is the harsh, stark reality. Mr McCrann continues: The single most striking message is that each and every year he has been treasurer, Mr Keating has seized a higher proportion of the taxable income of the seven million taxpayers in Australia than in the previous year. He is the biggest taxing Treasurer that we have ever had. The response was abuse at Question Time but, of course, there has been no response to the economic and political problems which have been brought about as a result of this building of expectations and the basic failure of the Government's economic program. Honourable members opposite can exaggerate and employ hyperbole until the cows come home but when people are feeling the pinch, as they are from one end of this country to another, there is in fact no real policy response. So we see in the upper echelons of the Government nothing but division, distraction and conflict between the positions that they have adopted. After being told that expenditure cuts were a thing of the past, we have had the Minister for Finance (Senator Walsh), saying, `Expenditure cuts will have to be back on the agenda'. We have had another Minister saying, `Oh well, in respect of tax cuts, they might not be all at once; we might have to stagger them, a bit now and a bit later'. Yesterday, Senator Button said, `We cannot indulge ourselves'. We cannot indulge ourselves! What arrogance. In regard to the taxes paid by the taxpayers of Australia, he is saying that we cannot indulge ourselves. It is no indulgence to say that we are paying too much tax. This Government has not just got its hand in the taxpayer's pocket; it has its arm in up to the elbow and beyond. That is the reality of Labor and taxes. That is the situation in which we find ourselves. This is a Government very much out of touch. We have a Prime Minister whose only agenda is not the future economic well-being of this country but a short-term electoral gain in the seats of Adelaide and Port Adelaide, and a short term political gain, as he perceived it, in the days leading up to the by-election in the seat of Oxley. He is trying to fool and deceive people into the belief that the good times are coming when in fact the economic situation in this country is of growing concern. As a result of the build-up of expectations we now see people in the trade union movement such as Mr Kelty, the Secretary of the Australian Council of Trade Unions, saying that they are looking forward to the biggest tax cuts in history. The dogs are barking. We had Mr Harrison on air this morning talking about what the trade union movement is prepared to take and the negotiating position that it will develop. We see differences in the trade union movement, with the Left in Sydney starting to run its own campaign. The reality is that with the build-up of expectation there will be a build-up which the Government will be unable to fulfil. The reality and the consequence of this build-up for wages policy is very considerable indeed. Of course, if the tax cuts do not fulfil expectations there is no doubt that there will be a push across the board for wage increases. I contrast the prospect of that with what the Minister at the table, the Minister for Industrial Relations (Mr Peter Morris), will tell us is the Government's industrial policy, on the one hand, and its wages policy, on the other. With the second tier, the national wage case and the guidelines laid down for award restructuring we have seen some attempt to move from a situation in which there is an expectation of across the board increases on the basis of indexation to a more productivity-based system of wage calculation. There is no doubt that one of the severe consequences of the build-up of expectations by the Prime Minister in recent weeks in respect of wages policy is to deny the central element of what the Government calls its micro-reform agenda, that is, to move wages policy from a position of indexation or across the board payment to one which is focused on productivity and the capacity of individual firms and enterprises to pay. This year there has been a 3 per cent payment and a $10 rise will follow six months later in a situation in which the Government has said, and the national wage case has said, people get the money now on the basis that they sit down and discuss with employers a basis for award restructuring which will provide some real productivity improvements for the economy. The Government is, therefore, essentially between a rock and a hard place because the Government, led by a Prime Minister whose short-term ambitions and short-term political strategy are the be all and end all, has placed itself in a situation in which, instead of focusing on what it has claimed to be its central objective, it has placed all the focus, all the public discussion, on the expectations of tax cuts next year. It is no good the Minister for Industrial Relations saying, as he did yesterday on television when asked about the ramifications of the divisions between the Treasurer, the Prime Minister and the Minister for Finance, `Look, do not ask me a question on that. You know I do not answer questions like that'. That is no answer! The Minister is now in the Cabinet and the conflicts, the build-up of expectations, the personal conflict between the Treasurer and the Prime Minister, are eating away, eroding away what the Government claims to be its central policy. Mr DEPUTY SPEAKER(Mr Ronald Edwards) —Order! The honourable member's time has expired. Mr PETER MORRIS(Shortland-Minister for Industrial Relations)(3.24) —That was a rather pathetic effort from the honourable member for Flinders (Mr Reith). I noticed in the course of his sonorous delivery that even the Leader of the National Party of Australia (Mr Sinclair) dozed off, the Leader of the Opposition (Mr Howard) dozed off, and several of their colleagues behind them fought bravely to keep their eyelids apart but it was just too much for them. One would have expected a much better presentation from the debut of the honourable member for Flinders. Certainly he would have been in grave difficulty if the Melbourne Herald had not been published at the hour at which it was published this morning, because what else could he have read from? The fundamental thing he failed to do was to refer to the terms of his own matter of public importance. Secondly, after attempting to berate the Government, he completely bypassed any reference to the Opposition's policy on wages. Just what is it that the Opposition expects to see in wages policy delivered next year? What level of tax cuts do the Leader of the Opposition and the Leader of the National Party see as appropriate? Not one word. Mr Rocher —What are you going to give us next July, Shorty? Mr PETER MORRIS —The honourable member from Western Australia asks about next July. To the Opposition we say: What is your policy? Opposition members should not berate other people in this House without putting forward what it is they see as appropriate. The position on this side of the House has been made abundantly clear. The Government and the Prime Minister (Mr Hawke) have said that there will be a reduction in income tax as from July next year. The level of that reduction will be decided closer to that time. Mr Hunt —Do you want us to tell you now? Mr PETER MORRIS —We would love to know the National Party's policy on this matter. The honourable member for Gwydir (Mr Hunt) may well flee from the House, but the electorate of Gwydir would like to know what he sees as appropriate, what the Opposition sees as appropriate, because, on this side of the House, the Government's commitment, as the Prime Minister has enunciated, is that there will be tax cuts. The level of those tax cuts will be determined in the negotiations that take place over the wages-tax trade-off in the first half of next year. At that time, dependent upon wages outcome and dependent upon the other matters referred to in the Budget Papers, there will be tax cuts. How can members of the Opposition have the gall to come in here and try to lecture us and hector us about industrial relations policy? Firstly, they do not have one. Secondly, has anybody forgotten the seven dark years of Fraserism? Has anybody forgotten their abandonment of centralised wage fixing and the open slather they allowed to go forward in 1980-81, with a wages break-out that resulted in an enormous increase in unemployment in the year that followed? Has anybody forgotten that? No, they have not. Nobody has forgotten the fact that the man then at the helm in financial matters is the current Leader of the Opposition, the honourable member for Bennelong (Mr Howard). He was the Treasurer, and he is the man who authorised this matter of public importance to come forward today. No one has forgotten that. No one has forgotten that the Opposition parties have never had a wages policy. The system that they put forward in 1981 collapsed and wages blew out. Average weekly earnings grew by 17 per cent over the year to the September quarter 1982. The consumer price index blew out to 12.3 per cent over the same year. The coalition, the Liberal and National parties, those who present themselves now as having some modicum of competence in these matters, led us into the worst recession that this country has seen since the Great Depression of the 1930s. What did they do when this great cherished proposal started to blow up in their faces? They panicked. They talked about decentralisation and they talked about deregulation in the labour market, and they swung back, in effect, to the most centralised form of wage system there is-a wage freeze. They imposed a wage freeze. It is important to remember this. Honourable members should take particular note because the same person, the Leader of the Opposition, the then Treasurer, was instrumental in bringing in the wage freeze. These are the same people who now feign a concern about family living standards. These same people feign an interest in what is happening to Australian families. It is well known from experience abroad that arbitrary freezes of that nature result in a wage blow-out after they are lifted. It is undoubtedly what would have happened if the coalition had still been in power. Wages would have blown out again and who knows what panic measures the coalition would have jumped to then-because they did not have the faintest idea what they were going to do. It was the old Micawber philosophy they have always followed, that maybe something will turn up. It is the only consistent policy that the conservatives in this country have ever had. Fortunately, the country was spared that development because this Government came into office with an accord that had been worked out with the trade union movement in advance, and the accord was the exact antithesis of the confusion and panic that reigned under the coalition. The accord embodied a consensus approach. It has harnessed the contribution of the trade union movement and brought results in terms of industrial relations harmony and economic progress unparalleled in the history of this country. Industrial disputation has fallen by more than half since those dark years of Fraserism, the years when the current Leader of the Opposition was the Treasurer. In our period of government we have created 1.14 million jobs. In our period of management the unemployment rate has fallen from over 10 per cent to 7 per cent. That is despite the large numbers of people who have been encouraged by general economic improvements to join the labour force. What is important is that under the accord process Labor has been able to handle difficulties that the coalition would have had no chance of handling. We provided an agreed and effective exit from the wage pause. The inflationary effects of the depreciation, stemming from the fall in Australia's terms of trade, were quarantined from the wage fixing system. The lot of the weakest and poorest of Australian families has been protected by real increases in pensions, benefits and initiatives, specifically the family allowance supplement. Most importantly, the job creation momentum has been kept up. Let us remember that in the Opposition's last 12 months of government almost a quarter of a million Australians lost their jobs. Instead of pursuing that course, we have created 1.4 million new jobs. On average, Australia's employment growth has been over 3 per cent per year since we came to office-more than twice the average for the industrialised world. Far from confusion, the Government has produced the most effective wage fixing system in Australia's history. The strength of that wage fixing system and procedures lies in the accord process, which allows flexibility to adapt to new circumstances and to find effective solutions. The Opposition knows it could not do that. It frankly confessed that. It does not have a wages policy. It has only one policy, the Micawber policy-a `something might turn up' policy. It has one consistent theme in its approach to industrial relations, that is, anti-union division and confrontation. No-one who has been in this chamber for a few years could forget the deliberate course of provocation pursued when the conservatives were on this side of the table. Industrial relations was an exercise in splitting and dividing the community, setting workers and trade unionists against management, creating division. The Opposition has not changed. It is talking about its industrial relations policy, if one could call it that-that ragbag of ideas. It has a very thin veneer of conciliation and mediation. That ragbag, that veneer, is all about fragmenting and destroying centralised wage fixing, destroying a national approach to wages policy in this country. What the Opposition wants is open slather. It says, `All businesses, one by one, will deal with their employees one by one'. Small business wants that kind of arrangement like it wants a hole in the head. Most small businesses do not have the resources, the skills or the people available to set up, one by one, industrial relations and mediation and consultation units. They depend upon the stability of a centralised system such as this Government has developed under the accord and under the structural efficiency principle brought down on 12 August. They depend on that to provide the overall umbrella of industrial relations for stability, equity and fairness and to provide also flexibility, so that there can be differences under that umbrella for particular locations, particular job situations and particular businesses. The difference between us and the Opposition is stark. Only those with their heads in the sand, such as those opposite, can deny progress. Like the leopards that do not lose their spots, conservatives do not lose their spots. They have learnt nothing; they have forgotten nothing. That division and confrontation is that main theme of what they are on about. We will provide within the policy we are putting forward a flexibility for individual managements under the umbrella of the Industrial Relations Commission, to make the kinds of changes appropriate to their needs. Within that will come the improvements in productivity, the improvements in efficiency and the improvements in competitiveness that this country has to have for its products here and abroad. That is something the Opposition cannot grapple with. It has to fall back on the only thing it knows-division and confrontation. It took the honourable member for Flinders a good 10 minutes of his speech to get anywhere near mentioning what he had put in the letter to the Speaker, the so-called matter of public importance. Let me ask the House: Just who does speak for the Opposition? Is it the honourable member for Bennelong? He was the principal architect of the disaster. No-one has forgotten those dark years of Fraserism-that pain and misery, that loss of a quarter of a million jobs. Maybe it is the other John-John Elliott-who speaks for the Opposition. One thing is very clear in this country: no matter how the Opposition seeks to paper it over and cover it up, the move to unseat the Leader of the Opposition is coolly, carefully and calculatingly designed to bring him down. The Treasurer (Mr Keating) put it best. He said, `It is like a carcass swinging in the breeze, hanging there dead and lifeless, but no-one is ready yet to cut it down'. I think it is probably John, the John that is not here. Honourable members could be excused for believing it is the honourable member for Kooyong (Mr Peacock). After all, he is the shadow Treasurer; he had a say in this matter. On the other hand, it could be the Leader of the National Party, or rather Senator Stone. We could go through half a dozen different names and eventually we would come to the honourable member for Flinders. It was quite evident from his contribution today that he is not having a very important role to play in all of this. Rather, to go along with the Melbourne Herald, he managed to present to us a cut and paste on the phoney issue of confusion allegedly on this side. I have rebutted that. I wish to say one thing: the honourable member for Flinders and the policies he is charged with espousing represent the mouth of divisiveness, of confrontation and fragmentation within this country. As I mentioned earlier, deregulation for small employers is destruction. Opposition policy means destruction of the progress and stability that Australian industry has gained from this Government. Let there be no doubt about it: the progress this Government has made is something that is unequalled in the history of this country. It is something that cannot be matched by those opposite, who have not even the slightest idea of how to approach it. We utterly reject the so-called matter of public importance that has been put forward by the honourable member for Flinders. Mr COBB(Parkes)(3.39) —It is rather sad to sit here this afternoon and listen to a Government Minister speaking with only one Government member listening to him. It seems that not only does the leader of the Government have no support but the Ministers have no support either. Indeed, it is quite extraordinary. It is particularly appropriate that, as we are debating this matter of public importance today, in one of the news- papers appears this great headline `Wanted'. It has a photograph of two people wanted for the biggest tax grab in Australia's history. Mr Ian Cameron —Who are they? Mr COBB —They are the Treasurer (Mr Keating) and the Prime Minister (Mr Hawke). People might have thought it was some latter day Ned Kelly or Ben Hall. The bushrangers of the day are lurking in Canberra. As the poster says, these two men are guilty-guilty of taking money from the pockets of millions of Australian taxpayers. In five years they have laid down probably the worst economic record this country has ever seen. I include the Whitlam years in that. We have seen the highest interest rates ever in this country and we have seen record bankruptcies, which are continuing. We have seen the largest current account deficit ever brought down, and a similar one will be brought down on Wednesday. We have seen the biggest blow-out in the overseas debt that I think any Western country has ever seen. We have seen a record decline in the value of the Australian dollar against overseas currencies, the highest tax rates ever laid down in this country, and the biggest public sector outlays ever. When one combines this with low productivity, that is the sort of record one has. Up until now the public of Australia has been conned by the economic management program, or lack of it, of this Government. Mr McGauran —They have been lied to. Mr COBB —The honourable member for Gippsland makes a very accurate observation. The figures have finally come out. The average Australian family is $56 a week worse off. Five years ago it was $56 a week better off than it is today. The debt of every man, woman and child in this country to overseas countries is about $7,000. That is approaching $25,000 to $30,000 a family. We have reached the stage where today the interest and principal repayments to those overseas countries amount to the equivalent of about 65 per cent of our export income. That is absolutely abysmal. When the Treasurer gets up, as he did today in Question Time, and reels off how great things are and how he told people overseas how wonderful things are, I can only conclude that he was not in the finance sectors of West Germany, the United States of America and Japan: he was in cloud-cuckoo-land. One has only to look at the figures: they cannot be tampered with. The record is absolutely shocking. Instead of the Treasurer skulking around the streets of Soho looking for the Leader of the Opposition (Mr Howard), as he told us-he was not there anyhow-he should have been talking to those people and learning what the situation is in the real world. Overseas assessors are downgrading Australia's creditworthiness all the time. We have lost our AAA credit rating, which is down to a AA rating. I suppose a AA rating is appropriate because this Government has been on an incredible binge over the last five years. Whatever standard is used, the record is appalling. Let us take the average single income family with a couple of children. In March 1983 such a family paid $65 a week tax. As at July this year, a little over five years later, such a family was paying $119 a week. That is how much living standards have slipped. Let us look at the home loan repayment of the average Australian. In March 1983 he was forking out an average of $350 a month. By July this year that figure had risen to $666 a month. It has almost doubled. According to those figures the only group in this country doing any good at all is those who construct caravans. In March 1983 the average person on unemployment benefit was unemployed for 35 weeks. Today the figure has soared to 60 weeks. The hopelessness of the unemployed has never been so great in this country. The pensioners and the veterans of this country have been ripped off and denied. Dr Theophanous —Which world are you living in? Mr COBB —People such as the alternative Treasurer from the far Left, who is babbling away in his seat, and those running this country are aspiring to do that. They still portray themselves as competent economic managers. Mr Nehl —They are out of touch. Mr COBB —As the honourable member for Cowper says, they are out of touch. The National Media Liaison Service-that Goebbels-type propaganda unit which the Government set up and which is funded by taxpayers' money-runs to the press gallery and feeds it stories. The rat pack of the press gallery has been fawning on the sorts of figures that have been given to date. Those days are over. The press gallery is starting to wake up, as is the Australian public. The Government's spokesmen are at sixes and sevens: they are totally confused. They have built up an expectation in the community which they cannot deliver on. We have seen a classic example of that in recent weeks. Before the Oxley by-election the Prime Minister went around saying, `All is rosy. We have done it a bit hard for a few years, but from now on you will have tax cuts and wage rises and things will start to fall your way'. The Prime Minister would do and say anything for a vote. He would sell his soul for a vote. The very week after the by-election, which was the second biggest rebuff for any government in Australia's history, the Government changed its mind. The day before the Oxley by-election the Prime Minister said, `It is rather unrealistic to talk about no wage rises at all'. However, the very same day the Treasurer said, `Zero wage rises are still a possibility'. Senator Button and Senator Walsh tried to back him up by saying the same things. But their real master-the Australian Council of Trade Unions (ACTU)-said via its President that such statements were totally unrealistic and that we would have a nil increase in wages next year. The ACTU Secretary, Bill Kelty, said there was no way that there would be a wage freeze. In recent days the Prime Minister has tried to back off and hose down the statements of expectation that he came out with only a week ago. That is the situation with wages. Regarding taxes, the Treasurer virtually announced a short while ago that the upper level of tax will come down from 49c in the dollar to 39c in one hit. Virtually the same day the Prime Minister said that if it comes down at all it will be phased in. Again, Senator Button and Senator Walsh tried to correct those statements. Mr Nehl —They are out of touch with each other as well. Mr COBB —As the honourable member for Cowper says, they are out of touch not only with the Australian people but also with each other. What summed it up better than anything else was a survey done by the Strategic Research International Group, which is a New York-based firm of financial analysts. That group surveyed 21 countries around the world and ranked each country on the basis of the fundamental economic trends in those countries. The survey was based on factors such as balance of payments, overseas debt and the domestic economic conditions applying to those countries. Where did Australia rate out of those 21 countries? We came last: absolutely stone motherless last. It was incredible. The Treasurer wonders why the people around Australia call him the undertaker! While countries such as Japan, West Germany and America were winning the gold medal, the silver medal and the bronze medal, it seems that the Australian Treasurer's medal should be fashioned out of the metal of rusty buckets. That is the legacy the Government has left us: we are running last out of the 21 top countries of the world and we used to be near the top. That is an absolute tragedy. This nation is in a fragile situation. In terms of economic criteria, we are falling further and further behind other nations almost monthly. The press gallery and the Australian public are starting to wake up to it. Following the trend of the Adelaide by-election and the other by-elections, the Government will be swept from office at the next election. Mr DEPUTY SPEAKER(Mr Ronald Edwards) —Order! The honourable member's time has expired. Dr THEOPHANOUS(Calwell)(3.49) —Anyone listening to the diatribe of nonsense from the honourable member for Parkes (Mr Cobb) would probably wonder what country he was talking about. Obviously, he was not talking about Australia because he would have to explain why last year 1 1/2 million people were banging on the doors to come to Australia. They are banging on the doors to come to this country because the standard of living, the lifestyle and the employment prospects in this country are among the greatest in the world. Honourable members opposite talk about Britain and the wonderful policies of Mrs Thatcher. Is it because of Mrs Thatcher's wonderful policies that we have had to put 30 lines into the Australian High Commission to deal with inquiries from people wanting to leave the United Kingdom? Why are those people wanting to leave? They are wanting to do so because of mass unemployment. The honourable member for Parkes dared to mention employment records. He was trying to say that there was something wrong with our employment record when we have the highest level of job creation of any Organisation for Economic Cooperation and Development country. I inform the honourable member that 1,300,000 jobs have been created in the last few years. Contrast that with what the conservatives did in their last year of government. Under them 250,000-a quarter of a million-people lost their jobs in one year. Their jobs were destroyed by the policies of the then conservative Government. Members of the Opposition dare to talk about employment. Although they dared to raise a matter of public importance in the House today, they did not speak to that matter of public importance but tried to talk about our economic record. Let me make it perfectly clear that Australia has taken a very different road from the Thatcher model. For those commentators who do not understand the difference, let me explain it once again. We have chosen to create jobs in Australia. Notwithstanding the difficult economic circumstances around the world, we have decided that we do not want our people to live in poverty or to be unemployed. While there was mass unemployment in the United Kingdom and other European countries, we created employment in Australia and employment is the single most important way of getting people out of poverty. The Opposition talks in airy-fairy terms about how it would have done it better. But when asked for specifics members of the Opposition refer to the neo-conservative policies of Mrs Thatcher in Britain, the very policies which, as I have mentioned, have created mass unemployment-more than double that of anywhere else in the Western world. So let us forget the nonsense of their claim that they have put forward positive suggestions in relation to these matters. Let me go to the matter of public importance itself. We are told that there is some industrial relations problem because the Government and the unions are having discussions in relation to wages and tax policies. Why should there be a problem? In the last few years the single most significant factor in the creation of the jobs that I have mentioned has been the accord with the trade union movement. For years and years the conservatives have been coming into this place and saying, `This accord is going to fall apart. There is a massive problem with the unions. Oh, you will not be able to sustain agreement with the unions. There will be massive wage rises. There will be problems, there will be strikes and there will be demonstrations'. What nonsense! Every time we have had to make a difficult decision which involved the union movement we have talked to the unions and worked out whatever differences the conservatives claim to have existed. The accord has held every time. Let me say to honourable members opposite that the accord will hold again. We will find a solution. We will have discussions with the Australian Council of Trade Union (ACTU) and, in fact, all interested bodies, before we come out with the policies for next year. The conservatives are trying to force us into making some peremptory judgment. They say that we have to make a judgment now as to the level of tax cuts. They say that the judgment cannot wait. The Prime Minister (Mr Hawke) has made it perfectly clear that there will be a substantial tax cut. The Opposition wants us to go into the specifics now, although we have said that the cut will be made from 1 July next year. Factors have to be taken into account and any responsible economic manager would want to take them into account. Therefore, we have to wait and see. We have to look at the progress of the economy-we are not irresponsible like the Opposition in the way that it behaved in its seven years of government-before making any determinations in relation to these matters. That is all that has been said. I say to honourable members opposite and to the House that we will find the solution. We will be able to bring down a substantial tax cut and a wages policy and we will be able to do it in agreement with the ACTU. That situation has been affirmed by the Prime Minister, the Treasurer (Mr Keating) and all of the economic spokesmen on our side. It is interesting to contrast our approach to industrial relations with that of the Opposition. What does the Opposition want to do? In addition to throwing all of the people out of work, which I mentioned earlier, what did those opposite do in this country in their seven years in government between the Whitlam Government and the Hawke Government? They created an industrial relations climate that was poisonous. There was conflict every day. There was a huge increase in the number of days lost due to industrial disputes. They could not talk to the trade union movement; they could not work things out with the trade union movement. They could not get the unions together with the employers to work for the good of Australia. Their attitude was `We have to beat the workers over the head'. It was very interesting to hear the comments of the new shadow Minister for Industrial Relations, the honourable member for Flinders (Mr Reith). I could not work out whether he was saying that the Government must come out now and offer people a very big tax cut or whether he was saying, `Oh no, the Government should not offer people any tax cut at all because it would be irresponsible'. One could not figure out whether he was saying one thing or the other. Of course, the problem is that we never know where the Opposition stands on these matters. Members of the Opposition are all over the place. Members of the Opposition then say, `Because you cannot sort out this problem'-which I have explained we will be sorting out-`there will be some big problem in industrial relations'. There would be a big problem in industrial relations if, by some mischance, honourable members opposite ever got into government and instituted the kinds of anti-union and anti-worker policies which have been instituted in places like the United Kingdom and which have led to mass unemployment and mass industrial disruption. We have to rebuild and restructure this economy. We have a lot of difficult decisions to make-decisions of the kind which the Opposition never made in its seven years of Government. We are working on that process. Those difficult decisions sometimes hurt some people. However, we have put into place packages of assistance for people. We have put into place the family assistance scheme. We have put into place packages to assist people who are unemployed for a short time as a result of industry restructuring. We have put into place training and retraining programs. We are looking positively at all aspects of this matter. What do we have from the Opposition? Do we have any concrete suggestions? No, all we have is a carping attitude on the part of the Opposition which jumps on the bandwagon and says, `Look, there appears to be some difference between what one Minister says and what another Minister says, so we will go out and claim that there is a huge problem between the Government and the trade union movement'. What nonsense! The economic strategy of this Government has been, in many ways, unique in the sense that it has achieved, through an incomes policy and an agreement with the union movement, the creation of jobs. This has enabled us to overcome the kinds of problems that many countries have witnessed. We need to continue with that general strategy to create even more jobs and to develop this country further. This is the only way to go, not the negative approach as put forward by the Opposition. Mr DEPUTY SPEAKER(Mr Ronald Edwards) —The discussion is concluded. Consideration resumed from 13 October. Consideration of Senate's amendments. Senate's amendments- No. 1-Page 8, subclause 4 (1), definition of ``public sector employment'', line 30, after ``but'', insert ``, other than in section 121,''. No. 2-Page 54, subclause 121 (1), line 25, after ``award'', insert ``or order''. No. 3-Page 54, subclause 121 (2), definition of ``relevant law'', paragraph (a), lines 34 and 35, leave out ``Compensation (Commonwealth Government Employees) Act 1971'', insert ``Commonwealth Employees' Rehabilitation and Compensation Act 1988''. No. 4-Page 59, subclause 133 (2), line 2, after ``organisations'', insert ``and associations''. No. 5-Page 84, subparagraph 189 (1) (c) (i), line 13, leave out ``3,000'', insert ``1,000''. No. 6-Page 86, subclause 193 (7), definition of ``small organisation'', line 40, leave out ``3,000'', insert ``1,000''. No. 7-Page 89, paragraph 197 (1) (c), line 8, leave out ``technically''. No. 8-Page 89, subclause 197 (4), line 31, leave out ``technically''. No. 9-Page 128, subclause 261 (1), line 31, after ``employees'', insert ``under the eligibility rules of the organisation that relate to the occupations in which, or the industry in relation to which, members are to be employed''. No. 10-Page 131, after clause 264, insert the following new clause: Liability for arrears ``264a. (1) Where a person has ceased to be eligible to become a member of an organisation and that person has not actively participated in the affairs of the organisation since that time, those circumstances shall be a defence to an action by the organisation for arrears of dues payable from the time when the person ceased to be so eligible. ``(2) Where such a defence is successful, that person shall be deemed to have ceased to be a member from the time that the person ceased to be so eligible.''. No. 11-Page 169, after subclause 333 (4), insert the following new subclause: ``(4a) An organisation shall not take, or threaten to take, industrial action against an employer because the employer is an officer, delegate or member of: (a) an organisation; or (b) an association that has applied to be registered as an organisation. Penalty: $1,000.''. No. 12.-Page 169, subclause 333 (5), lines 43 and 44, leave out ``or (4)'', insert ``, (4) or (4a)''. No. 13-Page 170, after subclause 333 (6), insert the following new subclause: ``(6a) For the purpose of this section, action done by: (a) the committee of management of an organisation or branch of an organisation; (b) an officer, employee or agent of an organisation or branch of an organisation acting in that capacity; (c) a member or group of members of an organisation or branch of an organisation acting under the rules of the organisation or branch; or (d) a member of an organisation, who performs the function of dealing with an employer on behalf of the member and other members of the organisation, acting in that capacity; shall be taken to have been done by the organisation.''. No. 14-Page 176, clause 344, line 35, after ``appeared'', insert ``, or are to appear,''. The DEPUTY CHAIRMAN(Mr Rocher) —It may suit the convenience of the Committee to consider amendments 1 to 9 together and amendments 10 to 14 together. There being no objection, I will allow that course to be followed. Mr PETER MORRIS(Shortland-Minister for Industrial Relations)(3.59) —I move: That amendments 1 to 9 be agreed to. I want to explain the background to what the Senate has proposed and why the Government considers that the amendments should be accepted. It may be helpful to identify the source of the amendments. In this group of nine amendments there are seven Government amendments and two Australian Democrat amendments. Broadly described, the Government amendments are non-controversial, technical and designed to improve the operation of the legislation. They were accepted by the Senate without any opposition. Government amendments (1) to (3) are designed to improve the operation of clause 121. This clause enables the Australian Industrial Relations Commission to make awards in areas of Commonwealth and Territory employment where difficulties might otherwise exist as a result of the operation of State or Territory legislation. Amendment (4) broadens the range of industry consultative councils under clause 133 in which members of the new Commission can participate. Amendments (5) and (6) are amendments moved by the Australian Democrats and supported by the Opposition. Clause 189 was amended by reducing the minimum membership requirement for federally registered unions from 3,000 to 1,000. Clause 197, which provides for the review, after three years, of the continued registration of unions with fewer than minimum membership, was consequentially amended. The Government is disappointed that the Democrats were unable to accept the Government's proposals. The minimum membership requirement is one of a number of interrelated proposals, which are designed to encourage the restructuring of federally registered unions in a way which complements and strengthens the significant progress towards achieving far greater efficiency in Australia's industries and enterprises. Undoubtedly the creation of fewer and better resourced unions, particularly through amalgamations, where a community of interest exists between the participants, will simplify and accelerate the essential processes of award restructuring, the redesigning of work without rigid job demarcations and the establishment of a multiskilled work force. Reducing the threshold membership requirement for registration will impair the speed with which those objectives can be reached. Even so, the Government is prepared to accept the amendment to avoid delays in achieving the other significant reforms under the Bill. Amendments (7) and (8) relate to clause 197. The clause, which concerns elections in registered organisations, is amended to clarify its operation in relation to the correction of defects in the nomination of candidates for election. Amendment (9) deals with the eligibility for membership provision, clause 261. The provision is amended to clarify its operation and to avoid any unintended narrowing of the range of persons who have an enforceable right to be admitted to an organisation with appropriate coverage of their work. I commend the amendments to the Committee. Mr REITH(Flinders)(4.02) —I shall confine any remarks to those amendments relating to the size of unions. The Government's original proposition was a figure of 3,000, and the Senate has reduced that to 1,000. The Opposition's view is that we should not prescribe arbitrarily any figure at all, and our preferred position was simply to delete the arbitrary limit in the Government's proposed legislation. For all the comments of the Minister for Industrial Relations (Mr Peter Morris), the fact is that our policy is not anti-union at all. He needs to understand the focus of our industrial relations policy, which is aimed at encouraging direct negotiations between employers and employees. It is not good enough just to say that big is beautiful, which is the Government's position in respect of the Industrial Relations Bill. The fact is that the size of a particular union ought to be a function of the capacity of that group to represent the interests of all of the union membership. I note the Government's constant claims that the whole Bill represents one of the great reforms of industrial relations, which is absolute nonsense-and I am glad that the former Minister is in the House. It is just typical gross exaggeration by the Government. I think there is proper concern that bigger unions simply mean, in some circumstances, more power for union bureaucrats. Of course, that is not in the interests of a sensible wages policy, let alone the interests of union members. Clearly there are some problems in the area of the size of unions. Demarcation disputes would be one area. I think honourable members are aware of others, such as the difficulty of having unions based on occupation rather than industry or enterprise, which would encourage the rapid flow of wage adjustments from one part of the economy to other parts. The problem is not that unions are too small. A small union, in which all the members have a close community of interest, may in fact be able to represent its members more effectively than a large bureaucratic organisation which has to look after the interests of employees in widely diverging industries or enterprises. In any case, it should be for the members to decide whether their union is effectively representing their interests. This Government loves to talk about democracy. But what about the rights of members to make decisions about the sort of entity which will represent their interests? Why does this Government deny union members the right to make those basic decisions? Why does this Government reckon it can sit in Canberra and dictate how people should organise their affairs? One of the great problems that we have in wages policy is the very simple fact that this Government likes to give support to union bureaucrats against the interests of union members. Our principle is very simple: we acknowledge that people have a right to associate. Freedom of association is a basic principle in this society. We also want to see economic structures built up which properly reflect the demands of the membership. Whilst we will support this proposal, as it is a compromise and is something better than the 3,000 that the Government was originally proposing, it would be better if the Government had accepted the great strength of the attitude which I have expressed and which has been put in the Senate. This Bill makes it difficult-it actually puts barriers in the way-for union members to establish unions to represent their interests better. It is highly doubtful that this Bill will affect the number of demarcation disputes because it is often the case, as recent studies have shown, that it is the big unions that get into demarcation disputes rather than the small ones. Big is not beautiful. In fact, the arbitrary establishment of limits for unions is contrary to the interests of members and contrary to the interests that we all have in having an economic, wages and union structure which best serves the interests of those people that those unions are established to serve-that is, the members. That is the position of the Opposition. We regret that the Government has not seen fit to enact legislation which would serve the interests of union members. Mr PETER MORRIS(Shortland-Minister for Industrial Relations)(4.09) —While listening to the honourable member for Flinders (Mr Reith), it has become clear that the Opposition cannot come to grips with the challenge of creating an industrial environment which can give better and more strongly resourced services to membership, and an industrial environment in which changes can be made in work place arrangements and in job classifications-such as we have in mind with award restructuring, which is strongly supported by industry and the trade union movement-so that we can achieve greater productivity and efficiency to enable this country to become more competitive at home and abroad. That is very clear. I was fascinated to grasp that from the comments of the honourable member for Flinders. It is all just too hard. What we have seen here is a little political opportunism masquerading as an industrial relations policy. To talk about a business by business set of industrial relations where each business which has two, 10 or 12 employees will have its own industrial relations award arrangements with those two, 10 or 20 employees-and so it will go down the scale-is a multiplicity of arrangements and agreements that can only result in division, fragmentation and instability. Put very succinctly, it provides the opportunity, the freedom, for the very strong to exploit the weak under the pretence of giving individual rights to workers. Put in that way it is an absolute nonsense. The Opposition should be honest about it and come clean. This proposal provides the opportunity to exploit the weak; it provides the freedom to do sweetheart deals which will result in the passing on of costs to the rest of the community; it provides the freedom to fuel inflation; it provides the freedom to undermine national economic policy-in fact, it is the abandonment of national economic policy-it would provide the opportunity for a conservative government to abandon financial responsibility for economic policy and just to walk away and leave it by saying, `This is case by case. Each of these companies, partnerships and little businesses will deal with their own employees. We don't have any sort of overall national wage policy'. In essence, it is a rerun of what the conservatives have always done-walk away from the tough challenges. Very clearly, it provides the prescription for industrial anarchy. To have that masquerade as something that is good for industrial trade unionists and to purport that it represents an improvement for individual trade unions is, in the Government's view, the ultimate in hypocrisy. I marvel at the fact that after all these years the Opposition still cannot bring itself to have a credible, comprehensive industrial relations policy. Is the honourable member for Flinders really saying to the Committee that in a nation such as West Germany-one of the most successful economies in the world since World War II, with about 16 unions in a population of some 60 million-this situation does not work, that it is far better to have what we have here which is 330-odd unions in a work force of about 7 1/2 million? Is he saying that 330 unions are not enough and that we should have more; that we should have one by one arrangements for the hundreds of thousands of individual businesses in this country and that they should each have their own set of arrangements? That should be seen for the idiocy that it is. It is a prescription for irresponsibility and industrial anarchy. I wish the Opposition would think a bit more deeply about it. It purports to represent the interests of business but business is not with it on this one; industry is not with it on this one-it is on its Pat Malone with this one. No matter what the facts are and no matter what is appropriate to industry needs, it does not matter. The Opposition is looking for a little bit of political opportunism so that it can masquerade as representing the interest of individuals. Were that policy to be put into effect, heaven help the individuals. The Opposition is out of step with industry's needs, with community's needs, and with the rest of the industrial world. Mr ROCHER(Curtin)(4.13) —If ever we needed evidence of the Government's big brother approach, that little episode from the Minister for Industrial Relations (Mr Peter Morris) surely should put the cap on what we have been saying. A very comprehensive and radical policy has been presented by the Opposition and put before industry people around the country. As far as I know, it has obtained near unanimous, if not unanimous, support. One of the basic tenets of that policy is that there shall be no limit on the number of people who shall comprise a union. The first amendment we are dealing with, which is covered by 1 to 9 in the schedule, promises to do little to improve the recipe for continuing centralised control of industrial matters which the unamended Industrial Relations Bill represented. For most of this century, the Australian work force has been chained by the centralised industrial relations system which has created unemployment, reduced the incentive for productivity and hard work, and has undermined the competitiveness of all Australian businesses to some large or lesser extent. This Industrial Relations Bill is intended to entrench further that system. It blatantly protects the interests of those already dependent on the system who have been aptly described as the industrial relations club. The amendments which have been proposed by the Senate-particularly amendments 5 and 6-raise further the question of freedom which plagued the Industrial Relations Bill when it was before the House in May. Honourable members will also recall that it was brutally guillotined through this place. What is the hurry? Five months later we are debating it again but the Government would not let us debate the merits of what is a very important Bill in terms of the social fabric of this country as well as the economy. One of the most consistently offensive aspects of the conciliation and arbitration system, as it is now constituted, has been its denial of freedom of association through the enforcement of real and de facto compulsory trade union membership, the registration of monopoly unions, and the real and de facto preference for trade union members. This amendment, which will reduce the minimum membership requirement for registration of a trade union from 3,000 members to 1,000 members, was introduced by the Australian Democrats. Of course, it effectively demonstrates the appalling double standards of that political party. All Australians should know that the Democrats would not support Opposition amendments to remove the preference clauses in this Bill which effectively enforce compulsory trade union membership. While members of the Opposition will not oppose this amendment, we do so only because it is not as bad as the even more draconian proposal of the Government in the unamended legislation. Even with this amendment, this Bill will infringe those freedoms of voluntary association which the legislation of this Parliament should uphold. The Minister rabbited on for a while but he overlooks the fact that the Government is prepared to hide behind the foreign affairs powers when it cannot get its way with the States. It will rely on conventions and treaties that it has ratified in this country. But when it comes to the labour market, regulation of trade unions and compulsory trade unionism, and the principle of freedom of association, it ignores three international conventions which it has already ratified. The first is article 20 of the Universal Declaration of Human Rights, which provides: Everyone has the right to freedom of peaceful assembly and association. It also provides: No-one may be compelled to belong to an association. Incidentally, that was ratified by the Government. Article 2 of the International Labour Organisation Convention Concerning Freedom of Association and Protection of the Right to Organise provides: Workers and employers, without distinction whatsoever, shall have the right to establish and, subject only to the rules of the organisation concerned, to join organisations of their own choosing without previous authorisation. This legislation contravenes that international treaty also. Further, article 22 of the International Covenant on Civil and Political Rights states: Everyone shall have the right to freedom of association with others. . . By stipulating a minimum membership of 1,000 before a trade union can become registered, we will be as a country in breach of all those international conventions and treaties which we have ratified. It should be made clear that in proposing this amendment the Australian Democrats are accepting the principles on which the Government has founded its corporatist approach to industrial relations. Far from keeping anyone honest, the Democrats have accepted the arguments of narrow vested interests-and, of course, the Labor Government-to entrench the essential corruption of the Australian industrial relations system, which precludes individuals looking after their own affairs and instead establishes monopoly coverage of trades and industries by existing unions. The Government has gone out of its way to assist the bureaucrats of the Australian Council of Trade Unions (ACTU) in furthering a policy of enforcing the amalgamation of trade unions to create a few large, powerful, wealthy organisations which will be unresponsive to their members and which will exclude any competition for membership between unions. It is another element of the approach of this Government towards big business, big unions and big government. This amendment will slightly reduce the force of that push for amalgamation, by allowing a number of existing small-but not the smallest-unions to continue to be registered. The Australian Labor Party has never had much confidence in the ability of individual union members, whom it considers to be its supporters, to make decisions for themselves. It treats its supporters with contempt. That is one reason why so many trade union members have always supported the Liberal Party of Australia. Of course, that is unarguable because we would not get the percentage vote we do had they not supported us in the past. The clause, as amended, will still seek to enforce amalgamation and continue that tradition of which I have just spoken. The Government suggests that Australia has too many unions for them to service all their members' interests effectively, but it does not trust union members enough to think that they might realise this for themselves and act to change things on their own initiative. Oh, no; we have to put something in over the top. The reality that the Government and the ACTU do not want to acknowledge is that when given the opportunity some people like the chance to join small unions. They do not want big unions. There is an understandable antipathy towards the larger bureaucratic unions which demand so much from their members to support the officials, but offer few benefits to those who actually work in industry. The proposals for enterprise-based unions which the coalition favours are both economically efficient and popular amongst many of those who realise that on most issues there is no divergence between their interests as workers and those of the firm for which they work. The Labor Party and the trade union movement are responsible for fostering this false belief, this myth, that individual employees and employers are, in some way, fundamentally opposed. In promoting this myth, they are acting out of blatant self-interest and working against the welfare of union members. Indeed, in reality, there is greater competition between employees in competing firms than between employee and employer in the same firm. If the economies of scale in larger unions are nearly as great as this Hawke-Keating Government suggests, acting as it does as the mouthpiece of the ACTU, genuine freedom of association would achieve the goals of those who want larger unions anyway. The DEPUTY CHAIRMAN(Mr Mountford) —Order! The honourable member's time has expired. Question resolved in the affirmative. Mr PETER MORRIS(Shortland-Minister for Industrial Relations)(4.24) —I move: That amendments 10 to 14 be agreed to. In this group of amendments there is one Opposition amendment and there are three Government amendments. Amendment (10) is an Opposition amendment to insert a new clause 264a. The amendment represents a compromise reached in the Senate to address the difficulties occasionally experienced by individuals who, for all practical purposes, have ceased to have any connection with a registered organisation to which they belong but who have not formally resigned. The amendment will provide persons in such circumstances with a defence if they are sued for arrears of dues for which they did not know they were liable. It will also terminate such an individual's membership where that defence is successful. The amendment was accepted by the Government in a spirit of compromise. There was some considerable discussion between the parties involved, including Senator Harradine, and I thought that was a quite sensible conclusion to the proposal put forward. Amendments (11) to (13) are interrelated Government amendments to clause 333. That clause prohibits certain discriminatory conduct, including action by employers against employees, or vice versa, resulting from the membership of a registered organisation by the victims of the discrimination. The amendments are designed to widen the provisions to prohibit an organisation, as well as the employees, from engaging in the proscribed conduct. This will provide greater balance to the provision. Amendment (14) relates to clause 344. This clause deals with financial assistance to individuals in certain legal proceedings under the Bill. The amendment is meant to ensure that the provisions relating to the payment of the fees of counsel are not narrower than the amendments which currently exist. In explaining the background to those amendments, I want to place on the record the recognition of the five years-plus effort that has gone into the development of this Bill and, in the concluding stages, the amendments to it in the other place. I want particularly to place on record the recognition of the effort of the former Minister for Industrial Relations and present Minister for Transport and Communications (Mr Willis), who is present in the chamber. It has been a herculean task and a task designed to create a much more appropriate and a much more pertinent and relevant industrial relations environment for the changes and improvements in our economy that are so very much needed. Mr REITH(Flinders)(4.27) —I want to say something about the amendment in respect of union subscriptions and dues. It was an initiative of the Opposition. I compliment senators in the other place for raising this matter, in particular Senator Chaney and Senator Chapman. I have a couple of examples involving local constituents. One constituent had been an employee of a service station. He was a strong unionist. One of his uncles, his father, or someone had actually been a union official. He had left his employ with the service station and he had told the union that he was going to another occupation or profession. He joined the union for the new job and, for some reason best known to the previous union, it never changed its records and it chased him for years after. All this time the dues were mounting up and this bloke was copping a massive bill from this union-the Transport Workers Union. This amendment prevents unreasonable demands by unions in that situation where a person has actually left his occupation and moved on to another position. It provides a defence to unions which take out legal proceedings against their former union members. This is a measure which, apart from having very considerable practical consequences for probably tens of thousands of union members, is rather symbolic of the difference between the Opposition and the Government. The fact of the matter is that this was an Opposition initiative. It is something that this Government should have undertaken more willingly than it did. It just reflects a greater empathy between the Government and union bureaucracies than would be in the interests of union members. It is an excellent amendment, and I commend it to the chamber. Mr ROCHER(Curtin)(4.30) —As has already been said, this amendment concerns the liability of people to pay the membership fees of registered organisations such as trade unions. It is essential to uphold some degree of fair practice for those unfortunate people who have little choice but to become members of trade unions, the alternative being to do without a job. At present many jobs require union membership before they can be taken up because of the requirement that trade union members should be granted preference over those who have chosen not to be union members. Supposedly, this is in the interests of industrial harmony. This means that the tyranny of those who would infringe the rights of others is given legal sanction to preserve some kind of unjust peace with the belief of the trade union movement. Anyone who doubts that compulsory trade union membership is a reality in Australia should observe what goes on on major, and not so major, building sites in our capital cities and around the country. Individuals who have little choice but to join a trade union or go jobless have few protections under this Industrial Relations Bill, which we are seeking to amend. They are constantly assaulted by astounding requirements for action on the part of what should be voluntary associations independent of direct government control. Clearly, this is not the case. This legislation involves detailed government intervention in the affairs of trade unions dealing with membership, registration, the rules of unions, conduct of elections, amalgamations, accounts and record keeping. Why does the trade union movement not cry out at the intervention of government in its affairs? The answer is simple: the Australian Council of Trade Unions (ACTU) has effectively designed the provisions which we are considering about the conduct of unions. It is not the Government but the ACTU which controls the industrial legislation which comes before this chamber. It is not surprising, therefore, that the provisions of the Industrial Relations Bill favour the organisational operation of the trade unions rather than the individuals who make up the membership. This amendment will help to rectify one of the those many presumptions in favour of the big and powerful organisations and, therefore, against the individual. This Labor Government, the Hawke-Keating Government-or is it the Keating-Hawke Government?-has proposed a system under which people could be liable to pay membership dues to unions even though they are not eligible to be members of those unions. If a member leaves employment in an industry which is not covered by the union of which he or she is a member, he or she will no longer be eligible for membership of that union. It is straightforward. A member can resign from a union but notice must be given in writing if that person is no longer eligible for membership. If notice is not received in writing, under clause 264 (3) of the Bill the association, meaning the union in this context, is entitled to sue for recovery of membership dues over the period after the individual has ceased to be eligible for membership. The purpose of this amendment is to allow a defence in recovery action over membership dues on the basis that the defendant was not eligible to be a member of the association or union in question. The amendment is perfectly reasonable. It does just a little to right the balance between the individual and the centralised bureaucratic organisation. When people who want to work are not free to choose whether they want to be a member of a union, they should at least be free of the burden of those unions when they cease to work. Mr PETER MORRIS(Shortland-Minister for Industrial Relations)(4.35) —I do not want to delay the proceedings of the Committee because time is of the essence, but I wish just to put things in their right perspective. Clause 195 (1) (d) of the Bill under `Rules of organisations' would require: . . . the organisation to inform applicants for membership, in writing of: (i) the financial obligations arising from membership; and (ii) the circumstances, and the manner, in which a member may resign from the organisation. The Government's intent there was that incoming members would be advised and made aware of the procedures to follow in terminating membership with the union. The amendment that was adopted in the Senate was not the Opposition's amendment. There was a discussion between Senator Chaney, the honourable member for Flinders (Mr Reith), Senator McLean and me. It was a collective effort. We had our departmental people work out the amendment that was subsequently adopted by the Senate. I make the point that we were not seeking to score points. Rather, a need was recognised, it was agreed upon and it was a matter of getting the appropriate form of words. In the course of things the form of words was put forward by the Opposition. We were quite happy with that, and we are pleased to support the amendment. Question resolved in the affirmative. Resolution reported; report adopted. Consideration resumed from 13 October. Consideration of Senate's amendments. Senate's amendments- No. 1-Page 43, Schedule 2, proposed amendment of the Northern Territory (Self-Government) Act 1978, after proposed subsection 53 (2), insert the following new subsection: `` `(2a) Until provision to the contrary is made by an Act, the powers of the Australian Industrial Relations Commission do not extend to employment in respect of which a tribunal established by an enactment before 1 July 1978 has power to hear and determine disputes, claims or matters relating to the terms and conditions of the employment.'.''. No. 2-Page 44, Schedule 2, proposed amendments of the Postal Services Act 1975, proposed amendment to subsection 3 (1) (definition of `organisation'), leave out the proposed amendment. No. 3-Page 45, Schedule 2, proposed amendments of the Remuneration Tribunals Act 1973, proposed amendment to subsection 3 (1), leave out proposed definitions of `academic staff', `college of advanced education' and `Commonwealth institution of tertiary education', insert the following definition: `` `Commonwealth higher education institution' means a higher education institution established by or under a law of the Commonwealth or of a Territory (other than the Northern Territory);''. No. 4-Page 46, Schedule 2, proposed amendments of the Remuneration Tribunals Act 1973, proposed amendment to subsection 3 (1), leave out the proposed definition of `university', insert the following definition: `` `higher education institution' means an institution that is a higher education institution within the meaning of the Employment, Education and Training Act 1988 (other than an institution declared by the regulations not to be a higher education institution for the purposes of this Act), and includes any other institution declared by the regulations to be higher education institution for the purposes of this Act;''. No. 5-Page 46, Schedule 2, proposed amendments of the Remuneration Tribunals Act 1973, after proposed amendment to subsection 3 (1), insert the following new amendment: ``Subsection 3 (1) (definition of `institution of tertiary education'): Omit the definition.''. No. 6-Page 46, Schedule 2, proposed amendments of the Remuneration Tribunals Act 1973, leave out the proposed amendment to paragraph 3 (4)(q), insert the following amendment: ``Paragraph 3 (4)(q): Omit `an institution of tertiary education', substitute `a higher education institution (other than an executive education office)'.''. No. 7-Page 46, Schedule 2, proposed amendments of the Remuneration Tribunals Act 1973, proposed subsection 6 (2a), leave out ``institutions of tertiary education other than Commonwealth institutions of tertiary education'', insert ``higher education institutions (other than Commonwealth higher education institutions)''. No. 8-Page 46, Schedule 2, proposed amendments of the Remuneration Tribunals Act 1973, proposed paragraph 7 (9)(ad), leave out ``institution of tertiary education'', insert ``higher education institution''. No. 9-Page 48, Schedule 2, proposed amendments of the Telecommunications Act 1975, proposed amendment to subsection 3 (1), (definition of ``organization''), leave out the proposed amendment. Motion (by Mr Peter Morris) proposed: That the amendments be agreed to. Mr ROCHER(Curtin)(4.38) —The Opposition amendment is relatively minor in its direct implications because it relates only to the Northern Territory. However, it demonstrates principles relevant to the wider impact of the Industrial Relations Bill. The amendment will allow the continued existence of certain autonomous tribunals in the Northern Territory which have handled particular industrial matters. Without this amendment the Industrial Relations Commission would be able to hear and arbitrate in regard to certain matters despite the continued existence of local authorities specifically for the purpose. This raises questions about jurisdiction and the centralisation of power which the Industrial Relations Bill furthers. The expanded role of the Commonwealth's powers in industrial matters has been aided by recent decisions of the High Court of Australia as well as the legislative activity of the Hawke-Keating Government. The Government, in proposing this legislation, has suggested that the centralisation of proceedings will allow matters to be dealt with `more speedily, more informally and more cheaply'. Not only is this contrary to the lessons of history and our experience with the old Conciliation and Arbitration Commission-which, I might add, was not noted for its speed and efficiency in solving problems, as anyone who was waiting to fly with Ansett Airlines of Australia a couple of days ago would well know-but it is laughable when it is examined in the context of this amendment, the non-acceptance of which could result in the huge expense and inconvenience of people travelling to and from Melbourne instead of using local resources and people with a knowledge of local industry and conditions. The example of the Northern Territory illustrates the problems of a centralised industrial relations system in a large country such as Australia. The Federal system is the means by which Australia has traditionally solved its problems of government, although in industrial relations excessive regulation by State governments is as destructive as excessive Federal regulation. That circumstance is compounded by the attempts of Federal Labor governments to expand their power over industrial matters, including the determination of wages. The Industrial Relations Bill sets up procedures for the Industrial Commission to have power in matters affecting the States, and presumably the Territories as well, where the States refer matters to the Commission. The procedure established sounds suspiciously like that for the interchange of powers which was rejected by the Australian people at the referendum in 1984. By mutual agreement the State industrial authorities will be able to act as agents for this newly created industrial commission and vice versa. I can see this cooperative procedure being the subject of controversy in the future as the Federal Commission tries to take over State authorities and, given the weight of money and support that it can get from the Federal Government, that takeover is almost inevitable. If we are not witnessing the beginning of the death of the State conciliation and arbitration apparatus I will be very surprised. If this sounds a little far-fetched, I remind members of the Australian Securities Commission Bill, which was debated recently and which would achieve exactly what the cooperative scheme which is presently operating in connection with company law has achieved. Whenever the division of powers between the Federal and State government becomes blurred, for whatever reason, there is pressure for the potential conflict to be resolved. Too often it has been resolved in favour of the Commonwealth and that is not accidental, nor was it unforeseen at the time that the legislation we are discussing today was introduced. It is important to avoid any unnecessary attempt to confuse the existing division of powers between Federal and State authorities. I suggest this will confuse, at least for a short time, the differences and the sharing of powers with State authorities and, as I have already said, I think we will see them disappear like the dinosaurs. Their effectiveness will disappear, even if they do not physically disappear. This amendment will maintain the autonomy of independent industrial tribunals in the Northern Territory and should therefore be supported as helping to preserve a Federal division of powers. I have no problem with that; in fact, it is entirely consistent with the argument I have been advancing. That does not imply support for the rest of the legislation. I simply report that many of these matters could have been dealt with-perhaps some of these amendments could have been proposed and passed in this chamber-had not the guillotine been applied last May, or whenever it was. We had about half an hour to discuss what is fundamental legislation. We have it back some five months later, which makes a mockery of the procedure adopted by the Government in the management of the House at the time. We could all have had a fair go. We might have legislated better in this chamber instead of doing as we so often do and that is to subcontract our legislative rights to our colleagues across Members' Hall. We are fast becoming recognised as simply a political chamber rather than a legislative House of this Parliament. I have raised this matter before and I suspect I will continue to raise it. I know honourable members on the other side feel exactly the same way and I see the honourable member for Herbert (Mr Lindsay) nodding his head in agreement. It is something which is very disturbing. We are not all bush lawyers but we can make legislation better, even legislation with which we do not agree. We can remove some of the bugs if we are given the time and the opportunity in this chamber. So with that little commercial I shall resume my seat, but I enjoin the Government to consider making this chamber more legislative in its work. Perhaps then we will all be better off. Mr PETER MORRIS(Shortland-Minister for Industrial Relations)(4.45) —I share the concluding remarks of the honourable member. The Government shares them. I am pleased that he has made the statement. I ask him to make the statement in his own party room. Mr Sinclair —You control the House. Be sensible. Mr PETER MORRIS —We do not control the Senate and the pushing through of legislation in this chamber has been to meet the deadlines for its receipt by the Senate. The Opposition executes and establishes in its own party rooms deadlines for this chamber to meet. I agree with what was said. The honourable member should convince his own colleagues in the party rooms that this House is being made subordinate to the Senate. The Senate is setting the legislative timetable for this House. The honourable member is absolutely right and it should stop. When the Bill went over to the Senate, it refused to examine it. The honourable member talked about five months. I am with him. He should not attack me, I am on his side. He should talk to his colleagues in his own party room. I will regularise matters in respect of this amendment. The honourable member is jumping at shadows talking about the death of the State conciliation and arbitration apparatus. That is not contained, suggested or even hinted at in any way in this legislation. This amendment arose because of concern by the Northern Territory Government which thought that the role of its tribunals dealing with Northern Territory prison officers, and Northern Territory police officers could be affected. The Government made the point to it that that was not the case. They would not be affected because there would be regulations made under the new Industrial Relations Act to achieve that result. However, the Opposition brought forward an amendment to achieve that. Even though we did not think it was necessary we readily agreed to it. We readily accepted the proposal even though we did not think it was necessary. In those circumstances, the Government has supported the amendment. It is quite wrong to say that the Government wants to take over State powers. The Opposition wanted to introduce a system in which intrastate matters, such as enterprise bargaining, were dealt with within the federal system. The Government has, in fact, been introducing new provisions to improve the relationship between Federal and State industrial tribunals. I commend the amendment to the Committee. Mr ROCHER(Curtin)(4.48) —I could not let a couple of those comments go unchallenged. The Minister knows that. I refer, firstly, to the Minister's remarks concerning whose fault it is that legislation is guillotined through this place because of some deadline imposed by our colleagues in the Senate. Let us be clear where the legislation originates. Legislation originates now in the administrative offices. Bills can be brought in here at any time-- The DEPUTY CHAIRMAN —Order! I ask the honourable for Curtin on the second occasion he is speaking to the amendments to speak to the amendments and not take up a rhetorical argument on the duties of the two Houses. Mr ROCHER —In so far as this measure affects the Northern Territory and the authorities which already exist there, it is one of those measures that could have been dealt with in this House earlier. It is necessary to respond to the Minister simply to make the point that the Government controls what is in legislation at the time it is introduced into this chamber and it can do that sufficiently early to enable it to go across Members' Hall to the Senate in time. The fact that it chose to bring in this Bill and debate it at the end of May last year deserves criticism. It is not the Opposition that created that circumstance, it is the Government, and the Minister knows it. I thought it just as well to clear that up now in case the Minister trots out the same argument again. Question resolved in the affirmative. Resolution reported; reported adopted. Consideration resumed from 12 October. Schedule 3. Department of Foreign Affairs and Trade Proposed expenditure, $1,302,699,000. Mr SINCLAIR(New England-Leader of the National Party of Australia)(4.51) —In the brief time allowed to talk on estimates in this place-and I must say that I have total sympathy with the views expressed by the honourable member for Curtin (Mr Rocher) in the previous debate-there are many aspects of this portfolio which I think should be better examined here, and in the complex of our proceedings there were procedures once which enabled a debate in this place to occur in much the same way as it does in the other place. Indeed, there I might draw the Minister's attention, although he has just left the chamber, to the fact that in the Senate even explanatory notes are prepared in respect of the Estimates. In this place the Government does not deign to do so. I wanted to talk about a number of aspects of the trade responsibilities within this portfolio, first because I am quite concerned that the Government and, in particular, the Treasurer (Mr Keating) and Prime Minister (Mr Hawke), apparently have no idea at all of what is happening to the Australian economy. The basis of my concern in respect of the departmental structures lies in the fact that four departments are responsible for trade at a time when our trade and our current account are absolutely critical for the well-being of this nation. There is no doubt that the figures demonstrate that Australia has fallen over the last few years from eighth to twenty-third place as an exporter. We know that our share of global exports has fallen from 2 per cent to 0.9 per cent, and with that has come a slide in our per capita income. Some years ago Australia enjoyed the fifth highest per capita income in the world. Today it has slipped to nineteenth. It is of worry to me that in addressing the trade component of the Department of Foreign Affairs and Trade there is an inability to really address the other three components. Not only do we have within this Department the Minister for Trade Negotiations but we have a separate department altogether, the ministry of Primary Industries and Energy, and we have another department, the department responsible for Austrade, which is promoting Australian trade, in the Department of Industry, Technology and Commerce. I regard it as totally unsatisfactory that, in dealing with the most critical part of Australia's economy, in looking at our balance of payments and in looking forward to where we might be able to take steps to redress some of the difficulties in our current account and external debt position, we have four departments and, hence, four departmental estimates that should be addressed. The idea of super-departments has failed abysmally as the total turmoil within the Department of Foreign Affairs and Trade represents. Again within that it is very hard to address the subject, although, to my mind, that is probably one of the most fundamental of all the administrative challenges that the Hawke Administration faces, and absolutely nothing has been done about it. The former Minister has moved on to higher things and returned from his jaunt abroad. There is now a new Minister whose attitudes and views concern me, but again I do not want to address them today. There has been a change in the permanent head of the Department and I believe the deputy permanent head is presumably about to be moved out of the Department because the new Minister does not get on with him. If that is so, I think it is very regrettable. I am concerned about the administrative complexity of a department which has these overlays. In the detail of the estimates, I am equally concerned about where we are going in the Uruguay Round, the multilateral trade negotiations. It is important for Australia to succeed, but, like the Minister for Trade Negotiations, who, on his return, expressed some pessimism, I too am pessimistic, because I am concerned that the Government has done so little to try to ensure that we initiate talks in the bilateral field-for example, taking up with the United States of America the opportunities that Mr Yeutter endeavoured to put to us about the time the Canadians were discussing free trade access with the Americans. It is not that we necessarily might want to take up the offer, but at least it gives us some bargaining coin, and this Government has passed it by. I am concerned, however, that a lot of other key economic issues need to be addressed. Perhaps the most important is the fact that we progressively are losing our credibility as a reliable supplier. I have a headline here from the Daily Commercial News: `Australia regarded as an unreliable supplier'-and we all know that there are so many areas in which that is apparent. Perhaps there is none more so than what happened in the port of Melbourne at the weekend. I find it incredible that the Government has not even been prepared to try to assist the HMS Ark Royal to dock in weather conditions which were obviously very difficult, and I feel that the nature of the Government's behaviour in relation to Port Melbourne at the weekend illustrates the whole problem in the trade field. The Government is not prepared to take our international responsibilities seriously and it does not understand that to succeed in the Uruguay Round or to succeed in our bilateral negotiations we must have a reputation as a reliable exporter and a country that can be trusted. How can one trust a government that is not even prepared to assist one of its closest allies and to allow an invited naval warship to dock in the port of Melbourne? What has happened is that the Socialist Left of the Victorian Government has taken it over. I introduced a piece of legislation in 1982, the Defence (Visiting Warships) Bill. If that piece of legislation had been reintroduced, it would have given the Hawke Government an opportunity to ensure that HMS Ark Royal was berthed. But the Government is concerned neither with that nor with the docking of HMS Edinburgh. Neither in defence matters nor in the trade and commercial area is the Government really worried about Australia's declining reputation. Nothing really brings our general reputation out more than the absolute disaster on the waterfront, and no analysis of the estimates of this Department would be really complete without referring to a number of the problems. We know that the Industries Assistance Commission (IAC) report has talked about the cost of transporting Australia's exports and imports and has talked about potential savings of more than $2 billion from transport reform, or nearly 20 per cent of the cost of the total value of goods exported. That equally would be supplanted if we could look at our own coastal shipping arrangements. Of that $2 billion the IAC says that around $200m relates to Australian flag shipping covering both coastal shipping and trans-Tasman shipping, $300m relates to international liner shipping, $700m relates to land transport of bulk commodities, particularly rail freight, and $850m relates to the ports and waterfront. We have heard a little about the comments of the Prime Minister (Mr Hawke) at the Business Council of Australia presentation of the export awards the other day, and the Prime Minister said how important it was. He talked about the difficulties that he saw and he picked up the figures that we have all been commenting on, such as the fact that apparently to transship milk powder from Taiwan to Tasmania costs $72 a tonne, but it costs $82 a tonne from Tasmania to Melbourne. The Australian Newsprint Mills says that the cost of shipping newsprint from a major European port to London was less than $50 a tonne whereas it is double that amount to ship it the same distance from Hobart to Sydney. We have any number of statistics on imports, too. In relation to salt, for example, Australia is an efficient exporter of salt to the Pacific basin but the high cost of shipping it around the coast makes it cheaper for some users to buy salt from Mexico. In Weipa in north Queensland we mine a material called kaolin which is used to produce coated paper which we export to Europe, but the major Australian user of kaolin, Associated Pulp and Paper Mills in Tasmania, is importing it because it costs so much more to use the Australian product. Perhaps the paradox of all is the Adelaide Brighton Cement company, which imports cement clinker from Japan for use in Darwin because it is too dear to bring it up from its own cement plant in Adelaide. That is an absolute disaster and there is nothing in these estimates that addresses this problem that the Prime Minister so blithely referred to. The Prime Minister is doing nothing about it and does not intend to do anything about it. Of course he will tut and tut and tell the business world how serious the problem is, but the reality is that it all emerged in the Daily Commercial News of 13 October this week when Tas Bull, the General Secretary of the Waterside Workers Federation of Australia, said that he had had a call from the great man and the great man had said to him, `Don't worry, Tas, all is okay'. He said that the radio presentation had `distorted' what the Prime Minister had really meant. The report stated: . . . after viewing a copy of Mr Hawke's address and then speaking to him personally, Mr Bull felt there was no change in the Government's previously stated policy on the waterfront. This is disastrous. There is an enormous problem. Those of us who have been flying in and out of Sydney have seen the container ships off the port of Sydney not being discharged. We have seen container ships off the port of Sydney not being discharged. We know of the 16,000 containers held up on our wharves. We know about all the problems. We know about the decline in statistics. We know about the problems in bulk commodities. I have not even had time to refer to the McColl Royal Commission into Grain Storage, Handling and Transport. We know that something has to be done about it. Unless the Government faces up to the fact that it cannot accept that there will be no change in its previously stated policy on the waterfront, our continued bad reputation abroad will continue. This is an important area. These estimates do not address the problem. The administrative responsibility is split into four. I suggest that the Government start taking trade and commerce seriously. If we do not we will continue to slip down the Argentinean road which the Treasurer (Mr Keating) and the Prime Minister seem so intent on thrusting upon us. Mr LINDSAY(Herbert)(5.01) —For many years the main objective of Australian foreign policy and strategy has been to preserve the peace and to prevent the expanding presence and influence of communist nations in the south-west Pacific region. The east Asian-western Pacific region remains a major theatre of confrontation between the free world and the Soviet Union, and political, military and economic rivalry will increase in the years to come. For decades the long term goal of the Soviet Union has been to weaken dominant free world influence in the south-west Pacific region. Over the past few years the Soviet Union has deployed space monitoring and intelligence gathering vessels to the South Pacific. Indeed, the importance of the South Pacific for control of space is one of the reasons why the Soviet Union has in recent years attempted to establish footholds among the nations of the South Pacific. I will speak in this debate about one major issue of concern involving Australia's foreign policy and trade. Some months ago the Soviet Union expressed interest in offering Australia a long term wheat agreement worth more than $100m a year in exchange for a deal involving port access for fishing vessels and landing rights for the Soviet airline, Aeroflot, for crew changes. If approved, the deal would permit port access for up to 50 Soviet fishing vessels which regularly ply the Southern Ocean off Australia and up to 9,000 fishermen a year operating through Australia. It would also include a joint scientific venture, with five Soviet research ships and Australian observers assessing the marine resources in Australian waters. In the Australian of 7 July 1988 a Deputy Prime Minister of the Soviet Union, Mr Vladimir Kamentsev, was reported to have `guaranteed there would be no spying by the 50 fishing boats the Soviets want to be allowed to use Australian ports'. Mr Kamentsev was also reported to have said that `no Soviet ship was involved in spying or equipped with nuclear bombs as some superman spies'. Only a grown-up mug would accept these statements as having any basis in reality. It is my belief that to allow the Soviet fishing fleet access to Australian ports without the most stringent security safeguards could jeopardise national security. Let me briefly examine some aspects of the activities of the Soviet fishing fleet. The Soviet Union operates the world's largest fishing fleet, with almost eight million gross registered tonnes. The Soviets exploit fishing grounds throughout the world's oceans with large flotillas of ships. As I have already stated, there are about 50 ships fishing in waters near Australia. The flotillas are usually self-contained communities capable of providing their own repairs, supplies and provisions through auxiliary ships deployed with the fishing units. On occasions these auxiliaries support naval activities, although their primary role is commercial. All fishing fleet officers hold reserve commissions in the Soviet Navy, so there is a natural military involvement in all levels of management. Fishing vessels are increasing their communications potential, with more and more units being configured with modern satellite communications facilities. This would contribute to real time surveillance and intelligence collection capability should these vessels be tasked with this mission. It would not be unusual for KGB-GRU agents to be assigned to fishing fleets for the purpose of human intelligence collection should the Soviets be allowed to call at Australian ports. I have no doubt that intelligence gathering is a major subsidiary motive in Soviet fishing activity overseas, as shown by its targets and techniques. The Soviets have also made special efforts to develop cooperation with nations strategically located or close to important international shipping lanes and straits. Since the mid-1970s the Soviet Union has approached a number of South Pacific island nations for access to fisheries. The Russians approached Papua New Guinea for a fishing agreement in 1986 but the then Prime Minister said in February 1987 that, while he did not object to the Soviet presence in the Pacific region, he did not intend to invite the Soviet Union to fish around Papua New Guinea. Western Samoa banned Soviet fishing vessels from her ports and territorial waters in 1985. Tonga allowed a Soviet vessel to research tuna in 1980 but rejected a Soviet request to survey Tongan waters in 1984. In August 1982 Fiji refused a Soviet request for access to Fiji's 200-mile zone. Fiji's ports were closed to Soviet vessels in mid-1982, when the Government said that the Soviet Union had tried to interfere in Fiji's general election. However, cruise ships were admitted again from mid-1986. In 1985 the Solomon Islands and Tuvalu both rejected Soviet approaches for fishing rights in their exclusive economic zones. In 1985 the Soviet Union agreed to pay Kiribati $1.5m for a one-year fishing agreement allowing 16 Soviet trawlers to fish within its exclusive economic zone. Kiribati did not permit Soviet boats within her 12-mile territorial waters and denied them port facilities. In October 1986 Kiribati let the agreement lapse because the Soviets wanted to pay a smaller licence fee and to transfer fish to a mother ship inside Kiribati's territorial waters. In January 1987 Vanuatu signed a one-year agreement with the Soviet Union for which it received $1.5m in exchange for permitting eight Soviet vessels to catch tuna in its exclusive economic zone. The Soviets are thus paying more per vessel to fish inside Vanuatu's poorer fishing grounds than they did in those of Kiribati. Those Soviet boats are now allowed access to Vanuatu's ports to purchase supplies and make repairs. The agreement provided for discussions on landing rights for the Soviet airline, Aeroflot, to replace fishing crews. However, the airport at Port Vila cannot at present handle long range aircraft but may do so after a $5m refit about to be carried out. During his visit to Australia, Soviet Deputy Prime Minister Kamentsev also claimed that the Soviet Union already had long term fishing agreements with France and the United States. It is true that the United States has a fishing agreement with the Soviet Union. However, in the agreement signed this year the United States Government reduced the number of ports that Soviet vessels may visit and it does not allow charter flights to bring crew members into US airports. These restrictions serve to reduce the chance for the Soviet Union to violate the terms of the fishing agreement. Any increase in the Soviet presence in Australia will require, as it does in the United States, increased government counter-intelligence capability to ensure that the Soviets do not abuse the terms under which they are admitted. It is interesting that at a time when the United States has reduced the number of ports to which Soviet fishing vessels have access, Australia is asked to open its ports to the Soviets. Proponents of an Australia-Soviet fishing deal point to the US-Soviet fishing agreement as an excuse for justifying a fishing deal between Australia and the Soviet Union. But even if one of the results of an Australia-Soviet fishing deal is to open a new window in Australia for Soviet spying on Australian and allied defence facilities, on that ground alone I believe it would be an act of foolishness to conclude an Australia-Soviet Union fishing agreement. Even if Australia secured a broad economic package as part of a proposed fishing agreement, possibly including business joint ventures in Australia and in the Soviet Union, that in itself cannot justify an Australia-Soviet fishing agreement which would allow Soviet fishing boats access to Australian ports. It would be a pathetically naive person who would trust assurances given by the Soviet Deputy Prime Minister about not using the port access facilities for spying. It is laughable to suggest that the Soviets have been punctilious in living up to their undertakings thus far in the south-west Pacific. A recent British analysis of Soviet fishing deals around the world paints a sorry picture of espionage, electronic spying capacity, broken commercial undertakings and aggressive fishing methods that have seriously depleted fishing resources. High-handed Soviet behaviour has outraged many regional fishing industries. To his credit, the Prime Minister (Mr Hawke) has been strongly sceptical of the Soviets' motives in seeking fishing and other deals in the Southern Pacific region. In the Age of 9 March 1987 the Prime Minister said: I find it difficult, on the basis of Soviet activities around the world over the last couple of decades, to accept that they would limit their interests to purely fishing. I have no doubt that the vast majority of Australian people fervently endorse this statement for its eminent good sense and national responsibility. The Prime Minister has been totally consistent in his opposition to fishing deals with the Soviet Union involving port access for Soviet ships. Australia has encouraged a number of Pacific island nations not to enter fishing agreements with the Soviet Union. It has prevailed upon three Australian States-Tasmania, Victoria and Western Australia-not to fall for the Soviet fishing deal bait. Who could ever forget the fervour with which the Soviets pursued their 1985 proposals for a floating dry dock off Western Australia? Above all, I fear claims that Australian counterespionage agencies can cope with any increased security dangers are about as credible as Mr Kamentsev's guarantee that none of the Soviet Union's fishing operations is involved in spying. Australians can take comfort in the knowledge that the Australian Prime Minister is standing ready to guarantee the integrity of the Australian security system and to preserve our alliance fully with the United States of America. Mr SPENDER(North Sydney)(5.11) —I agree almost entirely with what the honourable member for Herbert (Mr Lindsay) has just said. My only qualification would be in the weight that he places upon the good sense of the Prime Minister (Mr Hawke) when it comes to dealing with the Soviet Union. The Prime Minister has expressed concern, but it is strange that at the time the Prime Minister expresses concern his Government, apparently, is presently in negotiations with the Soviet Union over just the kind of fishing deal that has been described by the honourable member. There has been, of course, a change in the conduct of foreign policy in this country. Mr Hayden has decided to go to greener pastures and the previous departmental head has retired. We now have a new departmental head and a new Minister for Foreign Affairs and Trade. I hope that the change in the leading roles of the departmental head and the Minister for Foreign Affairs and Trade (Senator Gareth Evans) presages a re-examination of the proposal which has been outlined so well and so fluently and the dangers of which were exposed so clearly by the honourable member for Herbert. Indeed, I hope that in some ways the honourable member represents the new voice of the Government in this area, because everything that he said about the Soviet Union, about what it has done and about how it uses fishing fleets, is accurate. That being said, one must ask: How could we enter into a deal with the Soviet Union which would give access to our ports with the kinds of dangers that the honourable member has outlined? If we did enter into such a deal, is it not inevitable that this would be taken by the island states on which we have prevailed to avoid entanglements with the Soviet Union to mean that it was now time for them to reconsider their position? We cannot expect the island states to believe that there is one foreign policy for Australia towards the Soviet Union and another foreign policy which they must follow because they are not big enough to play in the kind of league that some of us think that we can play in. When I say that some of us think that we can play in a certain kind of league, I refer to those who believe that we can enter into agreements with the Soviet Union in areas touching on our security interests and somehow emerge unscathed. That extraordinary naivety was displayed by the previous Foreign Minister. There are echoes of it in the Prime Minister's approach to the fishing deal, notwithstanding what has been said about his scepticism. If the Prime Minister is sceptical and if, as I say, the views just put by the honourable member for Herbert are accepted by the Government as being sound, as unquestionably they are, the dangerous proposal which is presently under examination should be dropped and the Government should announce its position quickly so that we can get on with the business of dealing with the Soviet Union and forget about having a fishing deal which will involve all of the problems and all of the dangers outlined so well by the honourable member for Herbert. I now turn to a subject of current interest; that is, our aid program. Aid is the single largest component of spending in the foreign policy area. This Government came to power some years ago on a boast, amongst other things, that it would increase aid. Promises were made and promises were, of course, broken. This Government has developed the breaking of promises into an everyday art form. The present level of aid, when calculated as a proportion of gross national product, is the lowest in 25 years. At present about 0.36 per cent of our gross national product is spent on aid. In the last year of the Fraser Government the figure was much higher: it was around 0.5 per cent. Yet, with all this Government's promises, we are down to 0.36 per cent. Who knows where we will be when the Government faces up to the grim prospect of making savings for the purpose of the foreshadowed tax cuts? In the administration of aid some rather curious priorities have been demonstrated in recent times. We have seen the recent downgrading of five Pacific island states. Aid to Bangladesh has dropped from around $22m in 1985-86 to around $15.5m in 1987-88. That $15.5m includes $1.5m of recent emergency aid. I remind honourable members that Bangladesh is one of the most dirt-poor countries in the world, with a vast population afflicted by recent national disasters of a magnitude that it is impossible for us even to contemplate, with the result that millions are homeless. Yet our response has been to increase aid to Bangladesh by $1.5m at the same time as we have increased aid to Fiji by $10m. Senator Evans visited Fiji recently. He went there, among other reasons, for the purpose of finding out what is going on. We know what is going on in Fiji. It was unwise of Senator Evans to go back to Fiji so quickly after being snubbed so directly by the Fijian Government, as he was when he wanted to see Dr Bavadra, whom I met when I visited Fiji in late 1987, as I met General Rabuka and members of the then Fijian interim military government. What does the Government say? I quote from the Budget Papers. In terms of Australia's overseas aid program, the Government says: Firm assurances have been received from the Government of Fiji that Australian Government aid equipment and materials will not be diverted from intended developmental purposes and in particular will not be applied in any way to assist or support military activities. In relation to the additional $10m it says: In the implementation of this program the Australian Government will take account of political, constitutional, economic and social developments in Fiji, including human rights, as well as Fiji Government priorities. We know something about the track record of the Fijian Government in human rights and we have known more since the publication of the draft Constitution for the Republic of Fiji in September this year. Let me remind the Committee what that draft Constitution does. Effectively, it entrenches Fiji racial dominance in the political system. Of the 71 members of parliament, 22 are to be Indians-I think the Indians presently make up 48 per cent of the population of Fiji-eight are to be on the general list and there is to be one rota man representative, 28 are to be elected Fijians and 12 are to be nominated: eight by the President and four by the Prime Minister. One does not need to be an expert in mathematics to understand what the result will be. Looking at the Constitution itself one sees that, either explicitly or effectively, the result of the Constitution will be as follows: The President will be a Fijian; the Prime Minister will be a Fijian; the Commander of the Armed Forces will be a Fijian; most interestingly, the Commander of the Police will be a Fijian; and the Chairman of the Public Service Commission will be a Fijian-that board has the power to make appointments to public office-as will be the Chairman of the Police Service Commission, who has power to make senior appointments to the police force. The draft Constitution is an elegant document at first blush. It has in it a statement of rights which, if one does not look beyond the index, looks to be good. If one looks further one sees that all the so-called fundamental rights and freedoms are qualified out of existence. For example, one's right to personal liberty is there, but one may be confined in specified areas. One may be subject to public emergency decrees. There is one there now, administered by the Minister of Home Affairs and Commander of the Fijian Armed Forces and coup leader, General-as he is now-Rabuka. The Government must ask itself this very serious question: How can it possibly, at this stage, accept the assurances that have been given to it? What is the possible justification for increasing aid to Fiji out of a very limited aid budget when the Fijian Government is obviously determined to entrench race as the basis of political power and has treated this Government and its Minister for Foreign Affairs and Trade in a way which could only be described as contemptuous? What are our priorities and what are our principles? Are there not other countries in far greater need of the extra aid that we would provide to Fiji? The Foreign Minister will no doubt be making his recommendations to his Government. I hope that when he does so he looks very carefully at the Constitution so that he can understand the magnitude of the problem. The DEPUTY CHAIRMAN(Hon. J. D. M. Dobie) —Order! The honourable member's time has expired. Mr CHARLES(Isaacs)(5.21) —I, too, would like to direct my comments to the South Pacific which is, in a general sense, the most important foreign relations policy area that this country has. I was interested to hear the Opposition spokesman on foreign affairs, the honourable member for North Sydney (Mr Spender), make the comments he did about Fiji. For quite some time the Opposition has jumped from foot to foot in regard to its policies on Fiji. I was interested in what the honourable member had to say. I will speak about Fiji a little later in my speech. Initially, I want to raise the general question of aid in relation to Australia and the South Pacific. What do we mean by aid? I suppose aid has many branches to it. We can talk about budget aid which we give to Papua New Guinea. I believe that this type of aid always has to be treated with care. We can talk about basic food and medical aid, which has a proper place. But, unquestionably in my mind, the main element of aid should be of a development kind-economic development, infrastructure development and, probably more importantly, particularly in some of the smaller states, human resources development. Pacific island people to whom I speak-and I am sure that this applies to people in other parts of the world-often say, `Sure, the aid that we have been given is wonderful. It has helped us. But, really, we cannot get the fullest benefit out of it because we just do not have the people within our country to continue the programs that have been started'. This is a complex issue because the problems change from country to country. Every country has its particular problem. I suppose in this context I can talk about education. Recently, I led a delegation from the Joint Committee on Foreign Affairs, Defence and Trade throughout the South Pacific. We visited eight countries. They were in order the Solomon Islands, Tonga, Fiji, Western Samoa, Tuvalu, Kiribati, Nauru and Vanuatu. We met a wide cross-section of the community, including business people, individuals from the societies concerned and government people. (Quorum formed) Of course, the quorum was called because the Opposition Whip is trying to deflect attention from the Opposition's lack of policies; because it got done like a dinner at Question Time; because it has a leadership problem which it cannot hide and which will not go away. He will be doing exactly what he is doing now for many years to come. Luckily, the honourable member for Gwydir (Mr Hunt) will be at home, having retired on his well-earned pension. The honourable member for Indi (Mr Ewen Cameron) will still be sitting on the other side of the chamber. It will be a very long time before he gets over here. - I would like to return to the departmental estimates which are before the Committee. The delegation from the Joint Committee on Foreign Affairs, Defence and Trade had a marvellous trip throughout the Pacific. We met the Prime Minister of the Solomon Islands and the Crown Prince of Tonga. The honourable member for North Sydney said that he met several people in Fiji. The Committee had a personal audience with Brigadier Rabuka and the Prime Minister. In fact, we had a 2 1/2-hour meeting with the full Cabinet. Beyond that, we met every other President and Prime Minister, concluding with a meeting with Prime Minister Lini in Vanuatu. It was a very successful trip. Everywhere we went in the Pacific people came to us and talked about education and health. People in every country talked about the varying problems that they had. It was quite obvious that education and health were two of the major concerns of every country in the South Pacific. Education is part of the human resources problem. There is a need to try to educate people for the tasks that countries need to undertake either in the home country, in the region or here in Australia. Some countries were upset and did not believe that the University of the South Pacific was doing the job it should be doing. That claim is open to debate because I think it has done a fairly good job. But some of the South Pacific states do not feel that the university is appropriate to the needs of their countries any more. Indeed, I understand that Western Samoa has set up an arm of the university and that one of the subjects is Western Samoan culture, which is probably one of the strongest cultures and traditions of the South Pacific. As I said, problems were raised in regard to education and health. Of course, we must deal with the fundamental problems that most South Pacific countries face in terms of communications, transport and infrastructure support. Obviously I cannot deal with those problems at any length today. Suffice it to say, the level of our aid to the Pacific has gone up. Suffice it to say that page 11 of Budget Related Paper No. 4 for 1988-89, regarding our aid program, shows that country programs to the South Pacific in total amounted to $49.7m in 1984-85, and the estimate for 1988-89 has risen to $84.9m-or a 70 per cent increase in four years. It shows the Government's commitment to the South Pacific. There is a lot to be done. I believe economic growth, infrastructure support and human resources development must be fully sorted out and supported by this country. I think many more debates on this subject should occur in this House, and I hope I will have the opportunity to say more on this very important subject at another time. Mr HUNT(Gwydir)(5.31) —I did not plan to speak, but I noticed that a certain member was listed to say a few words on these estimates and as he is not here I will take this opportunity. I do so because I am very concerned about the importance of trade and our trade performance and the need to ensure that every action that could be taken is taken to ensure that our export industries, whether they be the farming industry, the mining industry or the manufacturing industry, are given every encouragement that the country can afford to alleviate our balance of trade problem. Since the Hawke Government has been in office there has been a lot of selective cutting of government expenditure. The three areas that have suffered most are, sadly, the primary industry, trade and transport infrastructure areas. There has been an enormous shift in resources. I am in the process of putting together a table to indicate what has happened in this country in the past 25 years. I do not blame this Government entirely. I blame the trend of public opinion that has occurred over that period. I am sick and tired of hearing people condemning Sir John McEwen and blaming him and the Menzies-McEwen Government for the problems we are suffering today. I think it is wrong to do that. The fact is that there has been a very substantial drop in investment in manufacturing industry in this country. A committee report was tabled in this Parliament which showed that since the mid-1960s there has been an alarming drop in investment in manufacturing. It has picked up recently, but in terms of the gross domestic product (GDP) it has not picked up to any great extent. I hope these tables will give some graphic illustration of what is going on in Australia. Over the past 25 years we have seen a reduction in the export percentage of GDP and a reduction in the investment percentage of GDP, and the transfer of resources, in a budgetary sense, from the productive sector of the Australian community to other sectors has been occurring alarmingly. There is no wonder that we are facing a balance of trade problem. We are relying on our basic industries, on our agricultural and mining industries, much more than perhaps we should in order to earn foreign exchange. I do not believe in the so-called level playing field concept. It has become the in thing, the sort of thing that people have latched themselves onto as a philosophy. The market forces theory that has now permeated the policies of, I think, both the Opposition and the Government is really based on the view that market forces in themselves will determine the making of the right decisions so far as investment and the economy are concerned. I do not believe that, because it is the factors that affect the market forces on the international market that will determine the actual market structure. I know that the Minister at the table, the Minister for Trade Negotiations (Mr Duffy), has been doing a tremendous job as the Minister responsible for trade in keeping together the Cairns Group, in trying to ensure that we have a more rational international trading environment for agriculture. I wish him well, and I hope that the Cairns Group is successful in showing some progress at the Montreal mid-term review in December. I know that the Minister has done everything in his power to ensure that progress is made. But I wonder whether at the end of the Uruguay Round we are going to see countries such as the United States of America and Canada, and all the countries in the European Community, adopt the policy that we have adopted-the level playing field concept. I wonder whether they are going to remove the subsidies applying to agriculture or whether they are going to create the sort of fair trading environment that we would like to see. In setting an example to the rest of the world, we have to be very careful that we do not find ourselves as one of the few exporting countries that have adopted a purist approach to trade. If other countries do not follow our noble example, we could well find ourselves in an even worse situation with our balance of trade than we are presently in. I think that John McEwen had the right idea to a large extent. When he was the Trade Minister for this country he established the fact that Australia was the twelfth greatest trading nation on earth. It is now twenty-third, behind Singapore and Hong Kong. He pursued a policy of encouraging, by various means, investment in various industries. Sure, he did not attack the tariff problem as soon as he should have, but he did recognise that there is no such thing as a level playing field in the world. I hope that Australia and this Government do not assume that we are going to achieve the so-called level playing field, the fair market that we would like to see, because I cannot see countries such as those in Europe, and the United States, in my lifetime reducing to any extent the subsidies that are available, for instance, to their farming sectors. Australia is facing a very serious standard of living problem. I do not think there is any more important field of endeavour for the Government than to concentrate on improving our export performance, whether it be in the primary industry area, in the mining area, or in the manufacturing area; or in the high technology area, which has a long way to go. I feel it was a great mistake to amalgamate trade with foreign affairs. I think trade is so important to this nation that it should be a separate portfolio. I think we should be giving it more emphasis and priority than this Government is giving it. I hope that when there is a change of government, the government of the day will see the necessity of re-establishing the old trade department and giving it the sort of support that I believe is necessary to improve the living standards of Australians. The standard of living of Australians is so heavily dependent upon trade and exports that we have a tremendous responsibility and opportunity in the next 10 or so years to establish ourselves as one of the great exporting nations in this area of the world, where half the world's population is living. We have a great challenge in front of us. Unless we grapple with this problem and unless we give this area sufficient resources, I forecast that we will continue down that dreadful Argentinean track that so many people talk about. We must look at the tax system and remove those taxes, for instance from fuel, that are making it difficult for exporting industries to compete. To increase excise on fuel from 6c a litre to 21c a litre and to tax fuel to the extent that we are taxing it, is certainly making it even more difficult for our industries to compete on that world market. Any tax that discriminates against the export sector should be reviewed and removed. Mr MILDREN(Ballarat)(5.41) —I want to make a few comments on our aid program, in particular that within our region. I also want to make some comments in response to the remarks made by the honourable member for Gwydir (Mr Hunt), for whom I have very high regard. When this Government assumed office, Australia's industrial situation was very parlous indeed. In fact, when we assumed office in 1983-84, capital expenditure was $13,021m; at present it is $23,262m. That is an increase on what was actually a decline of 12.6 per cent when we assumed office in 1983-84. That has now been increased to a 5.8 per cent increase. In other words, it is a pretty rapid turnaround. That has not occurred without a government policy which has brought to the attention of manufacturing industry the need to be export oriented. It is terribly important. There are certain terms which have been used today which probably reflect the Government's policies. For instance, it is important that Australia be aware of the need for improved quality and for improving designs. It is extremely important that Australians are aware of what clients want and not simply what we want to produce. It has to be concerned about levels of efficiency, of meeting the timetables and the contracts required. Irrespective of whether we talk about market orientation or whatever, one cannot expect that people in other countries will be terribly interested in trading with Australia unless we, as a nation, are prepared to be committed to those attributes. That is precisely what this Government is on about when it talks about gearing up this nation for exports. Coming from a country seat, as does the honourable member for Gwydir, I am very conscious of the fact that for so many decades we have been reliant upon the non-value added primary products-both of the farming industry and of the minerals industry-for our export earned revenue. We are still very dependent on that. I am sure that the honourable member for Gwydir is somewhat happier with the current level of commodity prices, in particular wheat prices, for his farmers. Mr Hunt —They go up and down. Mr MILDREN —That is true, but at present they are up and I am sure he is very happy about that. So far as we, in Australia, are concerned it is terrific because it will add a very large amount to our balance of payments at a time when we certainly need it. Even with the best scenario, the sale of those non-value added, or very basically processed, goods will not provide us with the kind of revenue advantage that will help us in competition with those nations, in particular the emerging nations, that are gearing up on the high value added industries. The message that this Government has been trying to get through to manufacturing industry is that it has to function very differently from the way it functioned before. I recognise that the honourable member for Gwydir and, I suppose, members of his Party are still sensitive if one makes reference to the inappropriateness of the policy which had been put in place, no matter whether it was for good reasons, by the previous Leader of the National Party. It might have been with the very best possible motives but it sent out an inappropriate message to Australian manufacturing industry that it did not have to take note of the world outside. The honourable member for Gwydir indicated that during the 1960s investment in those industries dropped right away-- Mr Hunt —The late sixties. Mr MILDREN —So far as this country was concerned by about the mid-sixties it was terribly apparent and by the late sixties it was tragic. We have to bear in mind that that meant that we were missing out on the opportunities that the rest of the world was picking up. The messages that the rest of the world was receiving were not being received by Australia. The capitalisation which was terribly necessary for a modern economy was not taking place at the time when it should have been. In a very diversified economy such as ours, it was still too easy to see the manufacturing sector as not terribly relevant to the future welfare of the nation in terms of the kinds of revenue needed for the development of our infrastructure, whether it was in social security infrastructure, transport infrastructure or whatever. (Quorum formed) The DEPUTY CHAIRMAN(Hon. J. D. M. Dobie) —Order! The honourable member's time has expired. Mr LANGMORE(Fraser)(5.52) —During the 1980s there has been a terrible depression in developing countries. Living standards in many parts of Southern Asia, Sub-Sahara Africa and Latin America have fallen by around 15 per cent. This means that average living standards of already impoverished people have fallen even further. The World Bank estimates that there are now nearly a billion people living in absolute poverty. Absolute poverty is described by the Bank as `a condition of life so degraded by disease, illiteracy, malnutrition and squalor as to deny its victims basic human necessities'. At least another billion have such poor living standards that they are barely adequate for even a minimally secure and satisfactory life. So it is essential for all humane and reasonable people to contribute in whatever way is possible to reduction of this terrible misery. That is the central goal of the Australian aid program. Australia gives about $1,100m a year in a well-structured, high quality aid program to developing countries, partly in bilateral aid to our near neighbours, partly through multilateral agencies and a small proportion through non-government organisations. It is very good to see the high level of public support for Australian aid programs. It is a clear indication that the great majority of Australians want to make a contribution to ending the terrible impoverishment which I have described. However, there is not nearly enough knowledge around the community about the ways in which our aid funds are actually used. To illustrate, I would like briefly to describe one excellent aid project in Indonesia which I visited a couple of weeks ago. This project, the Bah Bolon project, is in North Sumatra and involves flood control, irrigation and rural extension. The project includes building levees along three distributory rivers in a delta so as to contain any flood, up to the most serious flood, which is likely to occur in any 10-year period. The channelled water is then used for irrigating rice and vegetable production. The project also involves training farmers in the use of improved, high yielding rice and vegetables. The Indonesian Government has a goal of maintaining self-sufficiency in rice production; yet this potentially fertile land in the Bah Bolon river delta was in the past subject to almost annual flooding which greatly reduced its productivity. The effect of the project will be to stop flooding in most years so that rice production will be able to continue uninterrupted. This will greatly increase the productivity of the land, increasing rice yields and enabling a substantial increase of several thousand hectares in the area of land which can be cropped. The project began in 1983 and is expected to continue for two or three years more. Australia is providing 60 per cent of the funds and the Indonesian Government 40 per cent. Australia's contribution totals $32m. The project team involves a dozen Australians and about 150 Indonesians. When visiting the project last week I was impressed by the technical complexity of the task. Not only is building the levees a major engineering task, but also experts in agricultural science, fisheries, the environment and social development have been employed. The project is popular with the local people because it will substantially increase their incomes and prevent the regular disruption of their lives caused by flooding. Not surprisingly there have been significant technical problems in the building of the levees and the weirs, but each of those is being resolved as it is met. This project is one example of the excellent work being done through the Australian aid program. This project will lead to a substantial improvement in agricultural productivity and living standards in a relatively poor area of north Sumatra. I congratulate all the project personnel and the aid administrators who conceived and planned the project and wish them success as they tender for three additional projects of this type which the Indonesian Government is now planning. Mr Deputy Chairman, I am a member of a panel which is judging aid projects to give awards for excellence, and have been tremendously impressed--(Quorum formed) This amounts to suppression of discussion about the problem of global poverty. I am very disappointed that the Opposition would involve itself in this kind of silly diversionary tactic. I was saying before being so inappropriately interrupted that I am a member of a panel which is judging aid projects to give awards for excellence, and have been tremendously impressed by the appropriateness and the value of the projects. Every one of 40 or so projects, about which I read carefully, was worth doing and has been realised efficiently and imaginatively-in ways appropriate to the situations of recipient countries. Australians can be proud of the quality of our aid program. These examples illustrate the value of the whole program. Increasing aid would be a most important step towards a greater contribution to sustainable development in developing countries. In the 1988 Budget, the decline in Australia's overseas development assistance (ODA) was arrested. Aid was kept at 0.36 per cent of gross domestic product (GDP) so that there was a modest but real increase in aid of about $10m. At present Australia provides almost $1,100m in overseas aid. This might sound a lot but it is far below the level provided by other Western countries. The present Western average, the Organisation for Economic Cooperation and Development development assistance committee unweighted average of the proportion of aid to gross national product (GNP), was 0.49 per cent in 1987, compared with our own 0.36 per cent. In 1987, Norway gave over one per cent of its GNP, the Netherlands nearly one per cent and Sweden 0.85 per cent. Japan has rapidly increased its ODA from $3.4 billion in 1980 to over $10 billion this year, and Italy is doing the same. Increased aid is justified not only by humanitarian concern for the impoverished and a general commitment to fairness, but also by our economic and strategic interests. Australia is the largest northern country in the Southern Hemisphere. As a commodity exporter we experience the same destructive impact of Northern Hemisphere policies as does the rest of the south. More directly, our export and investment opportunities increase with the growth of developing country markets in Asia. The DEPUTY CHAIRMAN(Hon. J. D. M. Dobie) —Order! The honourable member's time has expired. Mr DUFFY(Holt-Minister for Trade Negotiations)(6.02) —I would like to respond to a few matters that have been raised in this debate, although I must say that the contribution from the Opposition seems to indicate that honourable members opposite are as lacking in policy in foreign affairs and trade as they are in most other areas. Mr Beale —What rubbish! Mr DUFFY —Has the honourable member got around to getting out a communications policy yet? Mr Beale —We got it out a long time ago. Mr DUFFY —No one noticed it. The right honourable member for New England and Leader of the National Party of Australia (Mr Sinclair) did his number again. We have a pretty fair indication now that he does not like the integration of the former departments of foreign affairs and trade because he speaks about it very regularly. That results to a large extent from the fact that he does not have anything particularly positive to put forward. The reason the two departments merged is that it was the view of the Government at the time, and it still is, that the international trading environment had become so complex and politically sensitive that it required a very carefully balanced policy response at both a multilateral and bilateral level. It has to be said that the Government's action in merging those two departments reflects the very high priority that we accord to addressing Australia's external economic problems. The Department of Foreign Affairs and Trade has put a great deal of effort into translating the Government's decision into cohesive policy and successful implementation. The effect of integration of trade and other economic priorities into the management of Australia's international relations has been evidenced by a very successful operation in concluding a number of agreements and negotiations in recent times. That is another matter that the Leader of the National Party continues to go on about. He gave a discourse about the Uruguay Round and passed over that fairly quickly. I will not deal with that in any great detail because I will rely on the remarks of the honourable member for Gwydir (Mr Hunt), who acknowledged how much work had been done and will continue to be done in that area. The Leader of the National Party continues to carp away that not enough is being done in the bilateral area. It is just not true. Considerable effort has been directed to the bilateral area, particularly towards countries which are likely to offer the greatest potential gains for Australia's trade-notably, those of the western Pacific region, particularly Japan, the Republic of Korea and China; New Zealand, which is of course our largest market for manufactures; and the United States and the European Community, which are our other major priorities. Despite the fact that honourable members opposite keep saying that not enough has been done in the bilateral area, there have been considerable achievements in this area. In regard to major markets such as Japan, the Government has obtained important assurances to the effect that trade disputes with third countries will not be resolved at Australia's expense. I remind those opposite of the beef agreement negotiated with Japan only a matter of a couple of months ago. That is probably the most significant trade agreement negotiated in the history of this country. It is a little different from the one that the National Party came back with years ago, which was positively discriminatory against this country. It positively discriminated against Australia in favour of the United States. When we talk about bilateral agreements, we should not forget that the one the National Party negotiated was a little ripper. From our point of view it was discriminatory, and we have fixed that. In regard to China, we have been able to take advantage of a rapidly growing market. As a result of our strategy of moving to establish a comprehensive framework for trade and commercial activity, exports to China have grown at the rate of 31 per cent per annum in the five years to 1986-87. That is not a bad effort on the bilateral side. In the case of the United States, some of the worst aspects of the omnibus trade legislation have been modified or deleted. Admittedly, the legislation is still basically protectionist but, in so far as it specifically affected Australia, its worst measures have been modified or deleted largely as a result of our bilateral efforts-not only government but industry representations. We have had a comprehensive review of the relationship with our third largest market, New Zealand, under the Australia-New Zealand closer economic relations trade agreement. That agreement now contains what could not have been imagined as possible under the previous Government to accelerate free trade between the two countries and includes the most comprehensive agreement on trade and services that has been negotiated by any two countries. It is more extensive than the agreement that has been negotiated between the United States and Canada. I thought that I should just mention those matters in relation to issues raised by the right honourable member for New England. He continues to say such things because, I think, in his view a good story ought not to be confused by facts. But, if we keep putting them forward often enough, the message may get through. The honourable member for North Sydney (Mr Spender) spent some time on the question of aid. In tough economic times it is not as easy as some people, particularly those in opposition, would make out to have as much money in some areas as we would all like. But it has to be said that the aid allocation of this Government has enabled spending to be maintained in real terms on ongoing programs for major recipients in South East Asia and the Pacific while allowing for some growth in other country programs. We have acknowledged our special responsibility towards our immediate neighbours, particularly Papua New Guinea and South Pacific countries. Reference was made to this matter by the honourable member for Isaacs (Mr Charles) when he pointed out the increase in aid from just under $50m to about $84m. He dealt with that matter in some detail, and I will not go over it again. The honourable member for Fraser (Mr Langmore) raised an issue which was of particular concern to him, as no doubt it was to the honourable member for North Sydney. In regard to poverty and the aid program, the Australian International Development Assistance Bureau has recently embarked on a study of ways to incorporate a greater focus on poverty in the aid program. The study aims to review how the aid program contributes to poverty alleviation at present and to suggest ways of increasing the poverty focus of the program. The main reasons for the study are the persistence of poverty in developing countries, as indicated by the member for Fraser-in fact, the worsening of that position-the need to eradicate poverty in any real process of development; the increased attention being paid to poverty alleviation by both international and national development organisations; and concerns in the Australian community, particularly among non-government organisations, that the aid program does not do enough to alleviate poverty. That study was announced at the world development debate in Canberra on 27 August of this year. The Australian Council for Overseas Aid has expressed an interest in the study and an outline of the study has been provided to the Council for information and comment. I acknowledge what has been said about those matters but the issues are being addressed. The honourable member for Gwydir is a person who is held in great respect by both sides of the House, and I thank him for his acknowledgment of the amount of work that has been done at a multilateral level. But I do not propose to deal with what he was on about today because his talk about the drop off in the manufacturing industry in this country until recent times was more than adequately answered by the honourable member for Ballarat (Mr Mildren). Although the honourable member for Gwydir may not like criticism of the Menzies- McEwen era in relation to that matter, the fact is that the matters outlined by the honourable member for Ballarat are correct. There was a period in this country when the manufacturing industry was going down. It was not facing the cool wind of change. It thought it could go on in a protected way for ever and was not facing up to the need for international competitiveness. As the member for Ballarat pointed out, one of the major issues which faced this Government when it came to office was the need to restructure our manufacturing industry. We have done that in a way that has not been achieved by any other government. The criticism of that period, presided over by the late Mr Menzies and Mr McEwen, is very justified. I have covered briefly most of the matters that have been raised by the Opposition and I thank all honourable members for their contributions to the debate. Proposed expenditure agreed to. Department of Industry, Technology and Commerce Proposed expenditure, $1,102,834,000. Department of Industrial Relations Proposed expenditure, $176,015,000. Mr REITH(Flinders)(6.14) —I want to take the opportunity of this Estimates debate to examine a very interesting decision-I think it is a landmark decision-in the Australian Conciliation and Arbitration Commission, entitled `Castle Bacon'. One of the central points of disagreement in the debate on industrial relations is the role to be played by employers and employees on a direct negotiation basis. Basically, the Government's position is that, unless there is a union to negotiate and to fix deals within the confines of a total package which has been dictated to the Government by the trade union movement, all hell will break loose and confusion and chaos will reign in the economy. It loads us up with all sorts of statistics to prove that thanks to the accord all great goodness and economic benefit have descended upon the land. Of course, that is a load of absolute nonsense. As time goes on and as I have the opportunity, as the new shadow Minister for Industrial Relations, I will make it absolutely clear that the facts do not substantiate the Government's position. The Castle Bacon Pty Ltd case was very interesting because in pursuance of the productivity tier, the 4 per cent, the union delegate and the employer in Castlemaine, which is a provincial city 120 kilometres from Melbourne, sat down and came to some sensible arrangements about how they should operate that particular enterprise. The union delegate put forward and negotiated various set-offs and he and the employer came to some different arrangements about the starting and finishing times for the business. That was primarily aimed at having a continuous production arrangement. It was all common sense. They came to some arrangements about show day or cup day, whatever it was, and made arrangements to pay people by cheque or by direct deposit into their accounts. That was all fine. Castle Bacon is one of the major employers in Castlemaine. The employees, through their union delegate, and the employer sat down and said, `Look, we have a stake in the future of this business'. The employees were asked what changes in work practices in return for a 4 per cent wage increase they were prepared to make for the benefit of the company. So they came to a deal. Some weeks after this arrangement had been entered into, the union's assistant secretary waltzed into Castlemaine and said, `Look, if the deal is not in accordance with the deal we have done with Don Smallgoods, I am afraid we will not have a bar of it'. Mr Beale —Is it another Mudginberri? Mr REITH —It is an interesting follow-up to Mudginberri and I think it will go down as a precedent of very great significance, as was the case with Mudginberri. Of course, the matter ended up in the Arbitration Commission and the first person to hear it in the Commission said, `Look, unless the union has been in on the deal right from the word go, then you cannot have this arrangement put into place'. The Commission awarded the 4 per cent. The people got the wage increase but there were basically no set-offs to match it. There were 520 employees at Castle Bacon and 460 of those had actually signed a voluntary agreement to say what they were prepared to do and what changes they were prepared to accommodate to improve the efficiency of Castle Bacon in which they all had a future stake. After that first decision which just said, `You cannot have this arrangement', the company took the matter to the Full Bench and got a very good decision on 5 October 1988. Basically, the Full Bench said, `We are greatly influenced by the fact that the employees by voluntary agreements have entered into an acceptance of the proposals worked out between the union delegate and the employer'. The Commission did not simply endorse the voluntary agreement; it arbitrated and produced an award variation specific to Castle Bacon which reflected the voluntary agreement. So, in essence, it gave official sanction to the substance of the agreement. That is very important because what we say is wrong with industrial relations in this country is that not enough attention is given to the capacity of employees and employers to sit down and work out agreements which are in the interests of both parties. In Victoria the meatworkers union has basically been a disaster for that industry. There is only basically Don Smallgoods Co. Pty Ltd and Castle Bacon Pty Ltd left of the big operators. The Mayfair company went to Queensland. In regard to the dispute at Mayfair, the union said that it was a great success whereby the union won over the employer and defeated the company. Five hundred jobs were lost in Bendigo and the union says that is a success! The Dandy company no longer produces in Victoria because of industrial disputes and the Hutton company is now producing out of Victoria. The union was not interested in the affairs of the union members. It was more interested in getting stuck into the bosses. The good thing about Castle Bacon is that it gives an opening to employers and employees who want to sit down and work out sensible arrangements to improve the productivity of the companies in which they have a stake in the future. The Government has been saying that this is not bad because it shows that under a centralised system we can have the benefits of voluntary agreements. I am sorry the Minister is not here because I had hoped that in finishing off these estimates he would give us a more formal statement on the Government's attitude to Castle Bacon, but I think honourable members have a pretty good idea of the Government's view, because in the industrial relations package which has been going through the Parliament and which has been completed today, in the Senate the Opposition parties put up a whole series of amendments to facilitate employers and employees doing exactly what they did at Castle Bacon. What did the Government do? It voted against them. On each and every occasion that amendments were put up by us to encourage this attitude of cooperation between employers and employees, the Government said no, because it does not suit its idea of industrial relations in this country being by and large controlled by a trade union movement. The Government likes to carp and criticise the Opposition's industrial relations policy, and its strongest attack in terms of constancy of its repetition is to say that we are confrontationist. The truth of the matter is exactly the opposite. The basis of our industrial relations policy is to encourage employers and employees to get together to make arrangements to improve the productivity of their workplace. That is the basis of our industrial relations policy. It is very simple and it is very straightforward. It is based on commonsense. If we want to see real reform in this country and a real increase in people's living standards, there is only one way forward, and that is at the corporate level, at the enterprise level, to encourage a new spirit of cooperation between employers and employees. It is about time the Government realised the gap between its rhetoric and its real policy position. It is about time it adopted more of the amendments that we have put. The DEPUTY CHAIRMAN(Hon. J. D. M. Dobie) —Order! The honourable member's time has expired. Mr MILTON(La Trobe)(6.24) —In speaking in the committee stage of the Appropriation Bill (No. 1) 1988-89 I would like to add to the comments I made in my speech in the general debate on the Bill. At that time I expressed my concern at the cuts in funding for the divisions of the Commonwealth Scientific and Industrial Research Organisation (CSIRO). Budget Paper No. 3, Portfolio Program Estimates, shows a 4 per cent drop in budget funding for CSIRO from $347.784m in 1987-88 to $334.207m in 1988-89. In addition to the cut in the appropriation, it has been brought to my attention that the National Building Technology Centre has been added to the CSIRO's Division of Construction and Engineering as a new function, the cost of which has not been taken into account in the estimates. Another serious problem is the cost of the 4 per cent second tier wage increase, which has been directly passed on to the costs of research programs with no corresponding adjustment in the appropriation from the Budget. The result of these cuts in the CSIRO budget has been a severe loss of confidence by many of our senior scientists in the Federal Government and its willingness to support the efforts of our research scientists to ensure that Australia keeps to the forefront in developing new scientific techniques and methods that can be applied to industry and commerce. The 4 per cent cut in the Budget estimates also makes no allowance for a possible 6 per cent inflation increase in 1988-89. If all the matters I have raised are taken into account, the true cut which CSIRO has suffered in the Budget is 10 per cent, which is a disastrous outcome for an organisation which is expected to provide the scientific knowledge which will allow Australian industry to face the challenges of the twenty-first century with confidence and ability. In the Australian of 27 September it was reported that Dr Trevor Scott of the Division of Animal Production has resigned because of what he described as the systematic destruction of the Organisation's research effort on behalf of the $12 billion livestock industry. He charged that his division had suffered real budget funding cuts of more than 50 per cent in the past six years. Many CSIRO scientists have voiced their criticisms in the media and some have written expressing their concerns in personal letters to me. I shall quote from one letter, which states: My experience in trying to attract support from industry for genuine research of long term value confirms the pessimism you expressed on this issue. Companies are only interested in prospects with immediate benefits. What we are now seeing is the majority of scientists working on projects that involve repeated application of existing expertise and knowledge to the problems specified by companies with money. We are losing sight of the frontiers and falling behind overseas colleagues. Scientists spend an increasing proportion of their time soliciting funds so productivity must fall substantially. It has to be asked in the light of that criticism, which has been echoed by many other scientists, whether it is sensible or practical for the Government to support the reported aim of 30 per cent of CSIRO's total research funds being provided by external sources in three years. This is despite the fact that the Australian Science and Technology Council (ASTEC) recommended that CSIRO be retained as a single statutory authority and that it be able to retain its earnings from outside sources and that the level of appropriation funding for CSIRO be maintained. The Government accepted those recommendations and said that the retention of earnings should not lead to a decrease in the CSIRO appropriations. In my speech in the debate on the Budget I referred to the comments by Dr Max Whitten, head of the Division of Entomology, which were strongly critical of the reliance of the Federal Government on CSIRO funding from external sources. The next day, after I had made my speech, a CSIRO research scientist, Mr Peter Hannaford, drew attention to the resignation of a brilliant young mathematician, Dr Adrian Baddeley, from the CSIRO because of the lack of government support for the CSIRO. Peter Hannaford wrote: For almost 40 years the CSIRO has served Australia admirably. Its long term benefits have been immense in agriculture, in mining, in the scientific instruments industry and in atmospheric and marine research, to name but a few. Now that has all changed. The CSIRO has been restructured along `business' lines: line managers have been installed; scientists have been told to become more relevant to the (short-term) needs of industry; prestigious divisions have been dismantled, and many top scientists have retired prematurely or abandoned the organisation. Such comments have obviously not been enough to convince the Government, and it is obviously necessary to draw the attention of the Government to the actual research efforts achieved as a result largely of government funding support. I have managed to receive some information from the Division of Entomology. I have a copy of its recent publication, which is entitled `Entomological Research and Development-a High Yielding Low Risk Investment'. In 1987-88 the division received $9.7m in Federal Government funds and $4.3m from mainly industry sources. During this period it is reliably estimated that the 280 staff of the division have generated economic wealth for Australia of a minimum of $50m, rising probably to $100m. I would like to go over just a few of those research projects, but it seems appropriate that I stop my remarks and resume them after dinner. Sitting suspended from 6.30 to 8 p.m. Mr MILTON —Before dinner I was talking about the problem of the cuts in funding for CSIRO. I continue my remarks by pointing out how pleased I am that the Prime Minister's attention has been drawn to the problems caused by the lack of funding for CSIRO. He has agreed that there will be a major inquiry into research funding and the impact of research and development on our economic development. As I understand it, the inquiry has terms of reference which would cover not only research funded from within the Department of Industry, Technology and Commerce but also research funded within the primary industries and energy, resources, employment, education and training and health portfolios. I understand that the four-member committee is now working. I suppose the only problem I have is that there is not a member representing the Australian Science and Technology Council because I think it would have been helpful if that body had been represented on the committee. Hopefully, the committee will ensure that there is an input from ASTEC. I believe that is one of the requirements of the terms of reference of the committee. I was talking about the research which had been undertaken in the Division of Entomology. I have a document which I received from the Division and I want to list to members of the House some of the very creditable research work that has been done by the Division. For example, there was an improvement to spray systems in Queensland grain sheds, which saved $1.5m a year. There was the reassurance for United States gluten customers on the degradation of pesticide residues, which saved another $30m a year. The development of methods for phospine fumigation of grain bunkers saved at least $2m. The control of the narrow leaf form of skeleton weed saved $26m a year. The biological control of crop and pasture lucerne aphids saved $1.5m a year. The integrated control of orchard mites produced a saving in spray costs of $140 per hectare. Area control techniques for fruit fly amounted to savings per year of $0.5m. Work on protection of underground cables from termites saved $2m to $5m a year. The biological control of sirex wood wasp will save $100m by the year 2000; and so the list goes on. Despite the economic returns from the Division's research its appropriation funds have been reduced by 15 per cent in real terms over the past four years. Unfortunately, the attrition continues, and apparently there is no end in sight. I draw the attention of the House to these matters because I hope they will be redressed. I understand the Prime Minister is thinking of injecting another $50m into Australian research. I hope this new committee will ensure that the funds that have been taken away from CSIRO are restored. Mr McGAURAN(Gippsland)(8.05) —In making a contribution to the debate on Appropriation Bill (No. 1) 1988-89-in this case, the appropriation for the Department of Industry, Technology and Commerce-I should say initially that I welcome the contribution by the honourable member for La Trobe (Mr Milton). It addressed the funding crisis-not the funding issue or the funding problem but the funding crisis-within the Commonwealth Scientific and Industrial Research Organisation (CSIRO). I support unreservedly his call for his Government to restore funding to CSIRO to something approaching its base in previous years. As the honourable member knows, CSIRO, the flagship of Australian science, has suffered a cumulative cutback of 32 per cent over the past five years. The effects on that organisation have been devastating. The truth is that CSIRO is on its last legs. If funding is not restored to CSIRO to allow it to maintain properly its level of research then, quite frankly, it will be reduced to a second rate institute. Those of us who have benefited from CSIRO over so many decades-and I would think all Australians fit within this category-feel saddened to see it in its present state. Mr Cunningham —Tell us about hydrolysed milk prices. Mr McGAURAN —The honourable member for McMillan interjects in a frivolous, even cynical, manner. Does he not care about the level of scientific research available to the constituents he is supposed to represent? I think it would be very important for his constituents within the electorate of McMillan to know that their member thinks so lightly of this serious debate that he can summarily interject in a frivolous fashion. There has been a critical brain drain from CSIRO as a result of these cutbacks. Within the Division of Entomology there are some 20 scientists who in the last few months have been forcibly retired or have taken early retirement so as to save the jobs of their younger colleagues. A number of them-at least 10-are presently working for CSIRO to complete their commenced project without charge to that body. That is a mark of the commitment that not just these particular scientists but scientists as a whole have to CSIRO. Is it any wonder that the CSIRO Officers Association, the largest group within CSIRO, has condemned, firstly, its own management for what it believes is the tacit, even subservient, acceptance of governments cutbacks and, secondly more importantly, the Government for its policy in regard to CSIRO and science generally? I believe that it is economic stupidity, even insanity, for the Government to destroy CSIRO piecemeal. Dr Max Whitten, the head of the Division of Entomology, has produced a very detailed and worthwhile paper which shows some of the economic return obtained by that Division. It works out to be a return many times over the initial investment by this Government. I remain puzzled by the obvious and glaring lack of interest in CSIRO of the Minister for Industry, Technology and Commerce, Senator John Button. Senator Button likes to parade around this country on a bipartisan basis claiming to be a reformer, a man who has the courage, the intellect, the determination and the vision to restructure Australian industry. Mr Downer —It is absurd. Mr McGAURAN —It is absurd, given that the principal research organisation in this country is disintegrating around him. What is the level of his commitment to science and research and development in this country? How much weight can we give to his self-proclamations of sheer genius? He is sadly betraying the very interest he pretends to represent by allowing CSIRO to go down the chute, if I may use that colloquialism. We have to remember also that it is not just CSIRO which has suffered in the past few years from Government cutbacks and Government neglect. The universities and colleges, which are responsible for harbouring so much of our scientific research, have also suffered. I have toured a number of these universities and met with a number of very eminent scientists as well as students. Let me deal with those students first. A recent study done by a small group of science students at the Australian National University showed that a massive 80 per cent of their fellow students were pessimistic about their long term employment prospects in this country. Moreover, an equivalent number were quite prepared to work overseas. Whilst we have a brain drain away from CSIRO and science overseas at a senior level, we have a corresponding crisis at the entry level into the science discipline. Much of the reason for this is not just that the size of the cake has been reduced drastically but that this Government confuses basic science with research and development. Surely that point is not lost on the Minister for Science, Customs and Small Business (Mr Barry Jones), who has just entered the chamber. The Minister has no credibility at all now in the science community. To be kind, he has been a passive observer of the reduction of the importance of science in this country. There are some accusations that he has even been a willing partner to the cutbacks. Until the Government understands and places sufficient importance on basic research as opposed to immediate short term research and development, quite frankly our universities and CSIRO will continue to run down. At present they are struggling with second-class equipment which is ageing rapidly, struggling with fewer and fewer scientists available to them, and working within a climate of depression because this Government, and too many in this Parliament as a whole, do not appreciate science. The CSIRO remains the principal organisation within the scientific community. It saddens me that the Minister for Science, Customs and Small Business, who has something of bipartisan admiration in this place and, admittedly, widespread affection in the wider community, stands as a failed Minister, despite some efforts on his part. It gives me no joy at all-no pleasure in any shape or form-to have to declare unequivocally that he has been a failure as Minister for Science. The best service he can render to science is to resign as a matter of protest, as he has hinted at in the past. Is he as good as his word? Or is the Minister so welded to the white LTD that he will not take the stand of principle? The DEPUTY CHAIRMAN(Mr Ronald Edwards) —Order! I inform the honourable member for Gippsland that the Committee is considering the appropriations. I would be grateful if he would direct his attention to those and not to personal matters. Mr McGAURAN —Rather than take up what little time remains to me, I will not debate your ruling, Mr Deputy Chairman, but it is beyond me how, in appropriations, one cannot address comments to the Minister in the chamber nor assess his performance in the appropriations administration of his department. But let us let that ride. We have already seen, earlier today, bias on the part of the Chair-- Mr Peter Morris —Mr Deputy Chairman, I raise a point of order. If the honourable member wants to make a personal attack on the Minister he must do so by way of substantive motion. I recommend to the honourable member that, if he feels so strongly about that matter and believes that, he should look at the Standing Orders rather than engage in this kind of abuse. I am indulging in the same practice in which he indulges. I ask, Mr Deputy Chairman, that you recommend that course to the honourable member. The DEPUTY CHAIRMAN —I have given a ruling that the honourable member will direct his attention to the expenditures before the Committee. Mr McGAURAN —The Government is certainly sensitive on this matter, and I do not blame it. If I were as discredited as it is on the matter of science, I would be sensitive too. Mr Cunningham —Mr Deputy Chairman, on a point of order: the honourable member for Gippsland said that earlier today the Chair had shown bias. I wish those remarks to be withdrawn. If the honourable member wishes to challenge the Chair he should do so by way of substantive motion. His remarks should be withdrawn from Hansard. The DEPUTY CHAIRMAN —I mention to the honourable member for McMillan that-- Mr Cunningham —The honourable member said that today the Chair had been shown to be biased. I ask that he withdraw that remark. The DEPUTY CHAIRMAN —If the honourable member for Gippsland said that earlier today the Chair had been biased, that remark should be withdrawn. Mr McGAURAN —Mr Deputy Chairman, I withdraw that remark. Mr MILDREN(Ballarat)(8.15) —The Minister for Science, Customs and Small Business (Mr Barry Jones) must be terrified following the assault that has just been made upon him by the intellectual butterfly opposite. The DEPUTY CHAIRMAN —I suggest to the honourable member for Ballarat, in the light of my earlier remarks to the honourable member for Gippsland, that he direct his attention to the proposed expenditures before the Committee. Mr McGauran —Tell us what you know about science, which is precious little. The DEPUTY CHAIRMAN —The honourable member for Gippsland has spoken in the debate. Mr MILDREN —As we know, the honourable member for Gippsland is an empty vessel. Mr Duncan —Content free. Mr MILDREN —That is about it. I wish to make some comments about the industry, technology and commerce portfolio. I believe that the future of this country's economy is critically concerned with the policies which this Government has introduced, through the Minister, since it came to office in 1983. I want to talk about the targeting of industries, the potential of industries to compete internationally, the emphasis upon the benefit that will be gained from foreign investment, and the countries and individual investors most likely to provide the desired investment. In the estimates of this portfolio, promotion for investment has been directed internationally through Austrade. There must be seen to be a tie between trade, industrial relations, the particularly important portfolio of industry, technology and commerce, science and foreign affairs. Unless the Government has a broad vision, we will probably fall in the traps in which previous governments fell; that is, working in a most ad hoc fashion. It is of great importance that this Government has demonstrated its concern to improve a flow of information throughout industry. It has established a communications network in Australia through the investment inquiries unit. This is an example of cooperation between the Federal Government, State governments and the private sector. Promotional campaigns have been aimed at specific companies. Such a campaign will take place firstly in the United States, beginning in 1989. It is extremely important that the promotional material which is provided be material which will clarify Australia's investment potential for industries in those countries. I listened with interest to the discussion of this portfolio by the honourable member for La Trobe (Mr Milton) and the contribution of the honourable member for Gippsland. Like most people, I would accept that it is desirable for the Commonwealth Scientific and Industrial Research Organisation (CSIRO) to become aware of the potential of gaining revenue and a synergistic benefit from its relationship with private industry and colleges. I think it is a pity that there has been a cut in CSIRO funds. I note that the Minister for Science, Customs and Small Business is nodding in agreement with me. Like him, I am concerned that the scientific community of Australia be adequately equipped with funds so that the necessary goals can be attained. I recognise that there are budgetary cons- traints. I recognise that the 39 per cent target that they are required to meet is probably desirable. However, bearing in mind that we are also targeting developments in industry, and in manufacturing industry in particular, it is a matter of some concern to me that adequate attention to the contribution that CSIRO and our scientific community can make to the development of manufacturing industry has perhaps not been given by the Government. If we are really serious about the contribution-- Mr McGauran —You are having two bob each way. Mr MILDREN —Do you talk in two bobs, little boy. Mr McGauran —You should be definite. Mr MILDREN —For goodness sake, why does not the honourable member go back to one of his motels? Mr McGauran —Why don't you say what you really believe, instead of equivocating? The DEPUTY CHAIRMAN(Mr Ronald Edwards) —Order! The honourable member for Ballarat has the call. Mr MILDREN —Oh, he is just a child. If we are serious about the role that our scientists are to play in the revitalisation of Australian industry, it is fundamentally important that CSIRO should have adequate resources.-- Mr McGauran —You are a gutless wonder, Mildren. The DEPUTY CHAIRMAN —Order! The honourable member for Gippsland will not interject. Mr MILDREN —Mr Deputy Chairman, I ask you just to ignore the child. Mr McGauran —Platitudes, Mildren, that is all you are good for. That is all you have ever done. The DEPUTY CHAIRMAN —Order! I warn the honourable member for Gippsland. Mr MILDREN —He is just being a child, a spoilt boy-just forget him. The DEPUTY CHAIRMAN —Order! The honourable member for Ballarat will focus on the debate. Mr MILDREN —I also want to refer to the national teaching companies scheme. This project fosters the very useful cooperation of companies and tertiary educational institutions in the manufacture of service and information technology. I make mention of Engsoft, a small high technology industry in my electorate which produces engineering software. I know that the Minister has been to the company, which is selling not only in Australia but also in Asia and the United States of America. A particularly good program under the national teaching companies scheme has been arranged between Engsoft and the Ballarat College of Advanced Education School of Business. I believe that programs such as this are very important in enhancing the relationship between business, industry and the training institutions. I certainly congratulate the folk at Engsoft and the Ballarat College of Advanced Education for the work that they are doing. I also wish to comment on management and investment companies (MICs). We recognise that the MIC program is due to terminate in June 1991. While the program has been useful and while we recognise that it has some problems, it must not be allowed to disappear until such time as we are absolutely certain that a risk capital culture has been adequately established in this country. So I exhort the Government to ensure that the progress of the MIC program is adequately monitored. I would also like to comment on the industrial relations scene. We hear a great deal about the need for a change in industrial relations culture in this country. I am not impressed by the way in which the Opposition approaches this matter, because in almost all instances-- The DEPUTY CHAIRMAN —Order! The honourable member's time has expired. Mr DOWNER(Mayo)(8.25) —I want to refer to the appropriations of the Department of Industry, Technology and Commerce and, in doing so, to talk about the general investment climate in our business community, not least in the small business community for which I have responsibility on this side of the chamber. Of course, the Minister for Industry, Technology and Commerce (Senator Button) has a responsibility to do what he can to promote a positive climate for our businesses and industries. That responsibility relates to things such as the level of taxation and, in particular, business taxation. It relates to our industrial relations system and the difficulties there are within that which have been well canvassed in this place today. It also relates to the problems that we have with the level of regulations for business, in particular small business, and the way, let us face it, over the last few years that the quantity of regulations has gradually risen. Even the Prime Minister (Mr Hawke) concedes that point. This has happened in spite of the work of the Business Regulation Review Unit, which I think is a very committed organisation but which has not carried sufficient weight in the bureaucracy and also in Cabinet. All of those things are important in creating a positive business climate. So are things like the national industry extension scheme, for which the Minister at the table, the Minister for Science, Customs and Small Business (Mr Barry Jones), is responsible. They are important in creating the right sort of climate. The difficulty that we have in this chamber is more than that. It is in creating the right climate for business and for industry throughout Australia when we have to deal with State governments as well as Federal bodies. I think several State governments in Australia are, in effect, undermining any strategy that the present Federal Government may have or we on this side of the chamber may aspire to. They are doing this through their own so-called business strategies. I think they are a matter of great concern to anybody who is worried about the future of our business community. The issues relating to Western Australia Incorporated, as it is often described, have been well canvassed around Australia. You, Mr Deputy Chairman, as a Western Australian, would be only too aware of that contentious debate. We have been through the Victorian election of late and the issues surrounding the activities of the Victorian Economic Development Corporation have been well canvassed in that State as well. In my own State of South Australia, however, the growing encroachment of government and government activity in the business sector have not been well canvassed. I think this is a matter of overwhelming concern. As a matter of fact, it is something that the Federal Minister for Industry, Technology and Commerce, and perhaps the Federal Minister for Science, Customs and Small Business, should be taking up with the South Australian Government. There is no doubt that the activities of that State in the marketplace-and I am using South Australia only as an example-are gradually undermining the confidence of the business sector. That reflects on this chamber and it reflects on the Federal Government. One only has to look at the extensive network of corporate ownership that the State Government of South Australia has to see how its activities impinge on the business community. The State Bank of South Australia owns an executive trustee company. It also owns a real estate company, a finance company, a stockbroker and a merchant bank. The South Australian Government Financing Authority owns a company, a wholly owned subsidiary which has shares in a whole series of companies such as wine technology companies, disposable products companies, Sybiz Software Pty Ltd and so on. It owns 82 per cent of SAGASCO Holdings and 99 per cent of South Australia Ventures. The State Government Insurance Commission (SGIC) owns 13 per cent of the South Australian Brewing Co. Ltd, 14 per cent of Coca-Cola Bottlers, 13.5 per cent of F. H. Faulding and Co. Ltd and 10 per cent of Adelaide Brighton Cement Ltd. The South Australian Superannuation Fund Investment Trust owns 80 per cent of Fairey Australasia Pty Ltd and 100 per cent of Thorn EMI. When one looks at that list-and I have given only a selection-one can see why, whatever the Federal Government may do with its appropriations, the activities of State governments are impinging very severely on the investment and business climate around this country. A senior Adelaide stockbroker, when referring to the State Government, said recently: The Government is taking a central role in business. It has been done in the name of local investment and protection of South Australia's industries but risk capital should come from private enterprise, not governments using taxpayers' money. That is a view that is reflected by organisations such as the Chamber of Commerce and Industry South Australia Incorporated. There is a real danger, evidenced in Western Australia after last October's share market crash, that the State Government's agencies could get into deep financial difficulties through their direct investments in business, and that affects the business climate. Other merchant bankers in South Australia have said-I have a selection of what they have said but I will quote this particular one: Government has set up a framework susceptible to abuse and incompetence. I use the word `incompetence' advisedly for the benefit of the Minister for Employment and Education Services, the honourable member for Makin (Mr Duncan). Bodies such as the South Australian Financing Authority have no management skills in a lot of areas they are getting into. If we add up the influence of the SGIC and of merchant banks that South Australian instrumentalities own, of the State Bank, and so the list goes on, there is concern that there is an overconcentration of financial muscle in the government sector. We can see throughout that State-- Mr Barry Jones —Mr Deputy Chairman, I raise a point of order. I am really reluctant to interfere, but I have some difficulty in relating this to the estimates before the chamber. Perhaps the honourable member for Mayo is going to get back and conclude with a real Sunday punch, but it does seem to be a fairly remote possibility. The DEPUTY CHAIRMAN(Mr Ronald Edwards) —I understood that the honourable member for Mayo was talking about the relationship between government and its technology and commerce policy and contradiction at the State level, so I will allow the honourable member for Mayo to continue. Mr DOWNER —Thank you, Mr Deputy Chairman. The point is an important one, and I want the Minister for Science, Customs and Small Business to take it seriously, because he has responsibilities in this area. It is extremely important that the Government understands that, whatever programs it pursues and however much commitment it has to the business sector and to private enterprise, the question is: How much is it able to achieve in the face of the various State governments that are, frankly, undermining much of any effort the present Government in Canberra may make to improve the standing of our business community? I am using the example of South Australia to show the difficulties that any Federal government is confronted with, the difficulties it has in dealing with a State government which is becoming increasingly entrepreneurial and in doing so is, on the one hand, risking the taxpayers' money, which I think is totally inappropriate for governments, and, on the other hand, is crowding out the private sector and making it almost totally dependent on government activity. It is hindering the flow of investment between South Australia and the other parts of Australia. But more than that, there are a whole series of questions that this type of action always raises about the role of government in financial and business activity. Look at the way the South Australian Superannuation Fund Investment Trust intervened earlier this year in the sale of Thorn-EMI. The Trust tried to take out an injunction to prevent a merchant bank, Morgan Grenfell Australia Ltd, bringing in prospective buyers for the 70 per cent stake up for tender in Thorn-EMI. Admittedly that injunction was quashed in the court, but it is an amazing example of what lengths a State government will go to, regardless of the views of the Federal Government, to intervene in the private sector and in the business community. Look at the way the annual report of the South Australian Financial Authority, for the second year in a row, states that audited reports of the financial activities of an arm of SAFA which exposed money to risk are simply not available. Not only are the audits of SAFA not done by the State Attorney-General, but the information simply is not given. Yet one of the subsidiaries of SAFA lost $16m last year. No one in the South Australian business community is able to find out anything about that. It creates uncertainty, instability and insecurity in that business community, and that is a matter of concern as much for the Federal Government as it is for the business community. The Minister and his Government must get the Victorian, South Australian and Western Australian governments out of business. Business is the business of business, not the business of government. Mr CAMPBELL(Kalgoorlie)(8.35) —I shall be as relevant in my speech as the honourable member for Mayo (Mr Downer) was in his speech. I want to start on a serious note, because I believe there is a will and a confidence in the grass roots of the Australian manufacturing industry community that we can compete effectively both in our Asian region and throughout the world. This will has developed during the course of this Government, and we need continually to address our fiscal and industry policies to provide the best opportunities for Australian industry to grow. To date the major initiatives have responded to needs of the large industries and large companies, as well as addressing the issue of strategic industries. Large companies, whether Australian based or internationally based, are mostly multinational in fiscal policy. Their investments are made on the basis of return on investment and as such these companies can place their industry where government incentives and local conditions provide the optimum return. These companies can even threaten to move their entire operations offshore, and often do so. Unfortunately, despite the apparent high returns by such companies, a careful review of balance sheets often shows that profits have arisen through asset trading which may make the shareholder happy but adds absolutely nought to the industrial strength and capability of our country. In fact the current experience in Western countries is that industrial growth does not arise from large companies. Large companies in general are conservative and acquisitive. In contradistinction to Japanese industry, Australian industry, particularly large companies, seek early high rates of return on investment. This results in a low level of speculative investment and hence negligible chance of investment in new and rapidly growing industrial opportunities. At the other end of the scale we have a plethora of small companies-those with a turnover of under $10m-with little opportunity or capability to grow rapidly through export. It is important that governments both Federal and State continually review the effects of policy on small business and endeavour to create special conditions to provide small business with the activation energy necessary to leap into a scale of operations conducive to export growth. It is the $10m to $100m corporations that I believe are the necessary basis for the next phase of Australia's industrial redevelopment. I will be working actively during the period of this Government to develop policies for this level of industry, policies which facilitate investment for enabling new technologies, provide incentives for establishment of new manufacturing industries, reward corporations for research and development which attains export business, and reward industry which returns its profits to the Australian people whether by reinvestments, dividends, or other services. Having concluded the important part of my speech, I would like now to deal with what the honourable member for Mayo said. He is like so many of the people on the other side of this chamber. They are silver spoon-fed individuals who have absolutely no idea how business works. We find that many of them come from the legal fraternity. My very good friend and colleague in the Senate once observed that, whatever one does, it is essential to keep the lawyers away from the money. The fact is that State governments have had to be entrepreneurial, because business is not. Business lacks the guts and the vision, for the reasons I outlined earlier in my speech. There was some criticism that the honourable member for Mayo mentioned, in passing, of Western Australia Incorporated-a paper catchphrase. He did not enlarge on it, because he could not. He did not know what he was talking about. The Western Australian Development Corporation and the State Government Insurance Office, in my view, have done commendable work. I think some of the initiatives taken by the State Government Insurance Office have been very beneficial to the State and have kept industries there alive. It is my view that not enough is done. One of the reasons for this is that invariably bureaucrats run these sorts of establishments and they are not by nature entrepreneurial. Whenever there is a failure, there is a crisis and we find the Opposition-and I dare say if we were the Opposition, we would do it too-jumping on the bandwagon and attacking. In truth, there cannot be successes without failures, and if there is involvement in an honest endeavour there will always be failures. Those failures are the price one pays for progress, for without them there is no progress. People talk of governments risking taxpayers' money. What is so new about governments wasting taxpayers' money? Governments of any complexion always waste taxpayers' money. I suggest to honourable members opposite that it is better to use the money in an honest endeavour to create wealth, to create employment, and to push forward the fortunes of our nation than to squander the money in other ways, for instance, in unemployment benefits generated by the government's lack of vision. I noticed that the honourable member for Mayo-and I have been in this House for a long time-at no stage criticised the previous Court Government in Western Australia. What did the previous Court Government do that could be considered as entrepreneurial? Against all the advice from industry, it signed a take or pay contract with a very obscure company, Woodside, in the North West Shelf. This take or pay contract delivered gas to Perth at prices substantially cheaper than were available in the Pilbara. The terms of this contract in fact make gas cheaper in Japan than in the Pilbara. Not having satisfied itself with signing this take or pay contract for gas which it could not use without abandoning its coal production and using it to generate electricity, it then spent $1 billion of taxpayers' money to build a pipeline from the Pilbara to carry gas that could not be used. There was nothing said about this by the honourable member for Mayo, nor might I add by those sleuths in the press who are so eager to criticise the Victorian Economic Development Corporation or the Western Australian Government. The taxpayers did not have a chance in this waste of their money. Sir Charles Court took advice from Mr Barnum, I think it was, who said, `Never give a sucker an even break'. The members of the public just did not have a chance. They were the losers from day one because there could be no profit in it for them. It was a gift, a transfer of resources, from the taxpayers to industry, and, I suggest, to an incompetent industry at that. Fortunately for the public in Western Australia, the Government changed and, to some extent, the present Western Australian Government has been able to redeem the situation somewhat. I am sure that the public in Western Australia is infinitely better off with the new arrangements arrived at by the present Government. One of the things that the Court Government proposed in its wisdom was to close down the town of Collie, which produces coal very effectively. Coal was used for generating power but the constituents were all Labor voters so it did not matter to the Liberal Government. An option was open to the Labor Party and so the Western Australian Labor Party has had to use that gas in Australia's interest in producing export earning commodities such as ethylene dichloride and caustic soda. These are either export earning or import replacing products. I think we should be ashamed that Australia, as a large consumer of caustic soda, has not done this before. I believe that the Government, rather than receiving brickbats for this, should be highly commended for what it has done. I might add that a lot of the other criticism of the Western Australian Government is based on what one might call being very wise after the event. It is true that the Government rushed in to bail out a particular merchant bank but it is not generally recognised by the people who criticise that the Government had to make a very quick decision on that occasion and every major charity and every local government authority had money tied up in that investment bank. There would have been wholesale chaos had that bank been allowed to collapse. There would have been enormous hardship in those areas. The Government acted very responsibly and it acted on the advice it had. What it did seemed to be a very safe policy indeed. Perhaps events have not vindicated this but certainly the best advice available to the Government was that it had to and should have acted at that time. In the brief time left to me I want to talk about some of the other industry developments that we have seen. My complaint is not that the Government is doing too much, as the honourable member for Mayo says, but that the Government is not doing enough. Often it is doing too little too late. Many small businesses that I have been personally involved with have been hanging by a thread because of the Government's reluctance to put money into them. I might add that in these cases one cannot get the private sector to put the money in because it wants a return in two years and one cannot get any worthwhile industrial development on a two-year investment. One has to stick with real estate if one is to do that. Of course, that is what Australian business has been doing all these years. It really has not given a damn about industrialising this country; it has been much more interested in the quick quid and the paper profit. Mr PETER MORRIS(Shortland-Minister for Industrial Relations)(8.45) —Earlier the honourable member for Flinders (Mr Reith) had much to say about the recent decision of the Full Bench of the Australian Conciliation and Arbitration Commission in respect of Castle Bacon Pty Ltd. The Opposition generally sought to make much of that decision. In effect it heralds it as the epitome of what the Opposition's industrial relations policies are all about. But by some contorted argument, the shadow spokesman for industrial relations, the honourable member for Flinders, then asserted that this example typified what is wrong with industrial relations in Australia and that the Opposition's proposed amendments to the recently passed Industrial Relations Bill were supported by reference to the Castle Bacon case-a case which the Opposition presented as some kind of Mudginberri mark 2. I draw the Committee's attention to the facts of the case and, in particular, what it tells us about the current system of industrial relations and wage fixation in this country as it has operated under the current Government's policies. The Full Bench of the Conciliation and Arbitration Commission recently upheld an appeal by Castle Bacon against a decision of a single member of the Commission. The key issue before the Commission was the application of the restructuring and efficiency principle. The Full Bench considered submissions from all parties including evidence from the employer regarding agreements reached with a majority of its employees. The Bench proceeded to arbitrate substantially in favour of the employer determining that, on the merits, the employer's proposals were within the scope and intentions of the restructuring and efficiency principle of the two-tier wage system. The Opposition has attempted to characterise the outcome of the Castle Bacon case as something other than the due process of the Commission exercising its powers under the current system. It sought to present it as some kind of victory; that the Commission was upholding an agreement reached between the employees of Castle Bacon and Castle Bacon itself. That was not the case. What happened was that the Commission, within the scope and intentions of the restructuring and efficiency principle of the two-tier wage system, upheld a variation of the award appealed against in relation to a decision by a single commissioner. The Opposition fails to acknowledge-and I think to understand-that a decision was reached under the system without any recourse to the opting out procedure or the like, just as the Mudginberri decision was the outcome of due processes of the Commission. It clearly gives the lie therefore to characterisations of our current institutional arrangements as highly rigid and inflexible which is the key note of the Opposition's rhetoric on this subject. The Castle Bacon decision, far from supporting the case for a swag of amendments that were moved in the other place to the recently passed Industrial Relations Bill, demonstrates the false basis upon which those amendments were cast. The honourable member for Flinders, in his press release of 10 October, got it all wrong; the honourable member for O'Connor (Mr Tuckey), in his press release of the same day, got it all wrong; and the Leader of the Opposition in the Senate, Senator Chaney, in his statement reported in the West Australian of 13 October this year, got it all wrong. As I say, the Castle Bacon decision, far from supporting the case for the swag of amendments to the Government's Industrial Relations Bill, demonstrated the false basis upon which those amendments were cast. In short, the current system is flexible and is contributing importantly to more cooperative relationships between employers, employees and their unions which in turn is assisting in boosting Australia's efficiency and productivity performance. Of course, the Government's wages and industrial relations policies have been key elements underpinning a dramatic shift in the industrial relations culture and wage fixing arrangements. The Government's approach is based upon consultation and cooperation. It is demonstrably bringing home the bacon in terms of jobs, profits, investment, international competitiveness and industrial harmony. The Government's approach is to be contrasted with the Opposition's rag bag of ideas aimed at undermining the current institutional arrangements, aimed at generating confrontation by an unwarranted attack on a responsible trade union, and aimed at advocating a wholesale free for all or open slather approach to wage negotiations which would be both economically irresponsible and industrially disastrous. I conclude with the words I used earlier today: the member for Flinders represents the mouth of divisiveness, confrontation and fragmentation. The Opposition's industrial relations policy means destruction of the progress and stability that Australian industry has enjoyed under this Government. Mr BARRY JONES(Lalor-Minister for Science, Customs and Small Business)(8.51) —I thank the honourable members who have contributed to the debate on the estimates for the Department of Industry, Technology and Commerce. I just want to comment on a couple of matters that were raised. I welcome the honourable member for Gippsland (Mr McGauran) as my fifth shadow Minister for science. The others, hard as they tried, all sank without trace. I have had more shadow Ministers in 5 1/2 years than I have had Opposition questions on science policy. I would have welcomed the odd debate, the odd matter of public importance and even, perhaps, the occasional censure motion, but somehow the Opposition was never quite able to put science high enough in its priorities. Somebody was perhaps uncharitable enough to say that he had never heard the Leader of the Opposition (Mr Howard) use the word `science' in a sentence and that he would, in fact, have some difficulty in being able to articulate the word, except perhaps as a cop-out, like saying, ` ``Science'' is a word in the dictionary'. There is a total failure of understanding in the Opposition. The honourable member for Gippsland was quite correct in saying that he thought too many members of the House generally do not appreciate the nature of science. I take that point quite well. But one factor is that within the House science has been put on the back burner to some extent because the Opposition has never really seen it as being an issue. I am not saying that the Government is devoid of responsibility. I think there is a degree of collective responsibility about that. Mr Duncan —How soon do you reckon it will be before the honourable member for Gippsland gets into his shadow responsibilities? Mr BARRY JONES —He is an eager youth who is looking for promotion, but I am not sure this is the area for it. The total situation about science funding needs to be placed in context. Compared to most other Organisation for Economic Cooperation and Development countries, the proportion of government expenditure on research and development in Australia is unusually high-far higher than it is in Sweden and the Netherlands, for example. That means that private sector investment has been unusually low. Since our election in 1983 it has been essential to induce industry to contribute directly to research and development, and this is happening, although at a far slower rate than we had hoped. Our gross expenditure on research and development-government and private-is now 1.18 per cent of gross domestic product. That is the highest figure for the past five years, but the percentage is exactly what it was in 1968-69. In a sense there has been a 20-year dip. The major reason for that 20-year dip was the appallingly low contribution of industry. Under the Fraser Government, and to some extent under our Government as well, the prevailing philosophy was to see the role of government as to compensate for market failure. If the market did not contribute enough to research, there was an obligation on government to top it up. I think we are now recognising that the international trading situation, the development of new products and services which are sweeping the world market and which are contributing to our unfavourable balance of trade, has moved far faster than most people anticipated. As a result, there was the announcement last week by the Prime Minister (Mr Hawke) of a very speedy review of science capacity in order to identify key elements to link science and technology policy to government policies already formulated on structural adjustment for industry and on education, to advise on actions that will be taken in 1988-89, this Budget year, to support research in areas of national importance, to advise on actions to increase awareness in industry of the need for collaboration in major, long term projects where large amounts of `patient money' will be required, to advise on initiatives in research that could be implemented in 1989-90--(Quorum formed) The review committee will also report on initiatives in research that could be implemented in 1989-90 and sustained in later years that would strengthen research, assist appropriate international linkages and contribute to industry and to Australia's national responsibilities and advise on ways to signal the importance of science as a factor in national life in addition to the substantial economic benefits which may accrue. Finally, the committee should draw as necessary on comparative overseas policies and performances in relation to both private and public research and development. The committee will prepare an initial discussion paper for the Structural Adjustment Committee of Cabinet by the end of November. I think we are moving very fast. I am very much encouraged by that. The honourable member for Mayo (Mr Downer) launched into an attack on the industrial portfolio owned by the South Australian Government, saying that it was `totally inappropriate and crowding out the private sector'. He also criticised Victoria and Western Australia for being involved in business undertakings. He came out with a rallying cry which I thought was almost of the late President Calvin Coolidge, saying that business is the business of business. But the point is that, whatever the particular brand of economic philosophy that is being pursued by the Government in the Commonwealth of Australia, we are essentially pluralist. I do not see us as taking a particular narrow, doctrinal line and saying, `This is the decision we make in Canberra and this has to be imposed on the States'. It is curious for an Opposition which, when it suits it, parrots out the argument in strong defence of States rights, which urged a No vote at the recent referendum because it said it wanted to protect States rights, the right of States to go their own way, to turn around and say that that is quite wrong; that the Commonwealth Government ought not to allow the Government of South Australia to engage in business enterprises because it is inconsistent with the political philosophy expressed in our Budgets, and that the only way in which one can express a commitment to the business sector is to leave that sector entirely to private enterprise. The private sector has not always been very enterprising. I endorse entirely the words of my colleague the honourable member for Kalgoorlie (Mr Campbell) when he said that the problem with too much of business has been its commitment towards the bottom line-its preoccupation with getting a cash return in the shortest possible period. There are some times when I think government is absolutely entitled to have a go, to take the long view. To some extent, of course, that has been the procedure adopted through the Australian Industry Development Corporation (AIDC). In Australia at the moment we are pursuing many developments which we believe will have very important long term effects. I point to the research project on the development of a malaria vaccine as an example of something which there is no indication would be funded if it were left to the market and to the private banking sector. We have to take the long term view. Individual governments and cabinets have made decisions in this area, as we made a decision recently to support the malaria vaccine project. The governments of South Australia, Western Australia and Victoria have, in their wisdom, involved themselves in equity participation in some companies. No doubt, in the long view, not all of those investments will prove to be correct. There will have been errors of judgment, just as there are errors of judgment in the private sector. However, I applaud the fact that the South Australian Government has seen the importance of maintaining a high technology base in its own State-a State which lacks some of the physical advantages of some of the other States. If it sees an opportunity to ensure that important entities such as Fairey Australasia Pty Ltd or Thorn EMI stay in that State, I will be the last to try to deprive it of the opportunity to form that judgment. I thank honourable members for their contributions. Proposed expenditures agreed to. Department of the Arts, Sport, the Environment, Tourism and Territories Proposed expenditure, $392,335,000. Mr SHARP(Gilmore)(9.04) —The Opposition welcomes the opportunity to discuss matters relating particularly to tourism and sport. We welcome this opportunity mainly because over the last number of months there have not been many chances in this Parliament to discuss matters relating to such important issues as tourism and sport. One of the reasons why there have not been too many debates on sport and tourism is that we have had a change in Minister and, with that, a change in emphasis. The new Minister for the Arts, Sport, the Environment, Tourism and Territories, Senator Richardson, is not nearly as interested in the portfolios of sport and tourism as was his predecessor. Senator Richardson is primarily interested in the portfolio of the environment. As a consequence, we have seen a distinct lack of debate in these two very important subject areas. We also welcome the opportunity to discuss sport and tourism because in recent days the Federal Opposition has been working very hard to compile the relevant policies on the two areas. Recently in Perth I had the honour of presenting the Liberal and National parties' policy on tourism at the Australian Tourist Industry Association's annual conference. Might I say that the new policy was very well received. It was well received because in that policy document we demonstrated a very serious commitment to tourism throughout this country. We have a commitment because on this side of the chamber we realise the tremendous potential that tourism offers the Australian economy and the potential it offers many young Australians for a career path in a very lucrative industry. At the end of this week in Sydney the Opposition, once again represented by me as the shadow Minister, will be launching its policy on sport. This is something of which I am particularly proud because the Liberal and National parties' new policy on sport gives 110 per cent commitment to this very exciting facet of Australian life. I look forward very much to presenting that policy in Sydney at the end of this week. It has been very sad in the last couple of months to witness the results of the Federal Budget. The sport budget was cut by 8.3 per cent in the Budget brought down by the Treasurer (Mr Keating) in August. The sporting community has recognised this cutback and is most upset. In fact, if we go back over the history of sports funding under this Government we note that, with the exception of the first year or two, sports funding has gradually deteriorated to the point where it now puts in question the viability of a number of functions that the Federal Government has sponsored in years gone by. Indeed, at the end of the day it must have an effect on the performance and ability of Australian sports men and women as they compete not just within Australia but throughout the world. We saw our Australian sports men and women competing in the last few weeks at the Olympic Games held in Seoul. On behalf not just of members on our side of the House but of all members of this Parliament I extend congratulations to all of those people who wore the green and gold representing Australia in Seoul. We congratulate those who won medals and those who proved to be great ambassadors for Australia. I think that we can walk away very proud and pleased with the results that were achieved over the fortnight or so in which the Seoul Olympic Games took place. One of the unfortunate aspects of the Seoul games was the highlighting of the use of drugs in sport. As a result of that there is an urgent need for a properly internationally accredited drug testing facility in location and operating here in Australia. A few years ago we had such a facility in Brisbane but, unfortunately, due to some technicalities it lost its international accreditation and, as a consequence, we do not have a proper, internationally accredited drug testing facility in this country. If Australia and this Government wish to be in the forefront in fighting the use of drugs in sport it is imperative that we have one of these facilities in Australia. I think it is important also that the new Minister, Senator Richardson, make a clear and unequivocal commitment to giving whatever support is necessary to ensure that the facility that is mooted to be installed in Sydney for this purpose can be got up and running very quickly indeed. On both sides of the chamber there is an abhorrence of the use of drugs in sport. The reason for that is that we recognise that the use of drugs for the purpose of enhancing sporting performance is straight-out cheating. There is no other way to describe it. The Opposition policy which will be released, as I mentioned earlier, on Friday this week in Sydney takes a very strong stand against the use of drugs in sport. One of the unfortunate aspects of the change of Ministry has been the fact that the new Minister has not come out with a very strong statement of condemnation of the use of drugs in sport. We look forward to his doing that over the next few months. There are a number of reasons why drugs should not be used in sport. Not least, of course, is the long term effect they have on the health of those who use them. They also destroy the entire ethos of sport. What we saw happen to Ben Johnson will in the long term prove to be of great benefit to the sporting community because it shows us that no matter how good people are, how important they are or where they are, if at one stage or another in their sporting careers they have used drugs they will be caught out and shame and disgrace will be heaped upon them. For that reason I believe it is important that this Government should obtain a statement on the attitude of the Australian Medical Association (AMA) towards doctors prescribing anabolic steroids for the purpose of improving sporting performance. Consequently, I hope the AMA will make it against the ethnics of the profession so that if a doctor is found guilty of such an offence, that doctor will be struck off. That is an important initiative that this Government can take up. We look forward to the early return of the Minister for Community Services and Health (Dr Blewett). One of the first things on his list of things to do will be to get that unequivocal statement from the Australian Medical Association. As I mentioned earlier, there is an urgent need for more funding of sport in this country. As I said, the Federal Government in its last Budget, following its practice over the last few years, has actually cut back sport funding by 8.3 per cent. So often we hear from the other side of the House comparisons between this Government's spending and that of other countries. A few moments ago the Minister for Science, Customs and Small Business (Mr Barry Jones) was in here comparing the Federal Government's spending on science and technology with that of Sweden and Switzerland. Let me just make a comparison with other countries in relation to their relevant federal governments' expenditure on sport. Switzerland spends $13.84c per head of population on sport. The USA spends only $7.43. Canada spends $3.12c per head of population on sport. Yet here in Australia, with its miserable lot of bean counters, only $2 a head is spent on sport by the Federal Government. So there is a clear example of why we need to see a greater commitment from this Government to spending more money on sport. In addition, we not only need to have a commitment from the Government in relation to funding for sport but also need it to give encouragement and incentive to the private sector to invest in more sponsorship of sport. One of the things that have happened over recent times is that within the sporting community these days there is a distinct feeling that sponsorship from the private sector for sport has actually started to wind down. We need to see this Government take the lead by ensuring that there is some incentive, some encouragement, for sport funding from the private sector. Overall, there is a number of very important matters that need debating but time does not permit that to take place tonight in the few minutes that we have in which to speak. I think the performance of the Australian Institute of Sport and, of course now, its amalgamation with the Australian Sports Commission will be debated later on this week when the subject of the amalgamation of those two organisations comes before the House. That will prove to be most interesting but at the end of the day I think the sporting community of Australia will be able to judge this Government's commitment to sport by purely and simply looking through the Budget Papers and considering how much money, time, effort and support this Government is giving to the sporting community. If it does that, it will find that it is deteriorating substantially and that there is a need for a change in the attitude to funding of sport, not only of the Federal Government but also throughout the community. Mr COHEN(Robertson)(9.14) —In my speech on the Budget the other night, I concluded my remarks by saying that, although I thought the Budget was an excellent one and that I was delighted that tourism and its role in the Australian economy is at long last being recognised, I was appalled at the decision by the Government not to proceed with the building of the Museum of Australia. I am as aware as anyone of the economic difficulties the Government is facing. It is not easy in difficult times for the Government to justify the expenditure of around $100m to build a national museum. As with the Parliament House, it will never be the right time to build it. Governments are never congratulated for taking these sorts of initiatives because there will always be a large section of the community which will argue that the Government's priorities are wrong and that if money of that order is available it ought to be spent on hospitals, schools, roads and so on. Governments have to live with the fact that their greatest deeds may not be recognised until years after they have departed the political arena. I refer, for example, to the Sydney Opera House. I made the point in my speech on the Budget that Australia is undergoing a boom in tourism largely because in the last few years we have woken up to the fact that a country needs more than just natural beauty, fascinating flora and fauna and friendly people. We have significantly improved the quality of our accommodation and made great strides in the presentation and interpretation of our history and culture. I make particular mention of such new institutions as the Stockman's Hall of Fame, the Great Barrier Reef Wonderland, the Sydney Powerhouse Museum and many others. Australia probably leads the world in its improvement in its presentation. They are only a sample of the new museum, galleries and interpretative facilities that have made Australia a far more interesting tourist destination, not only for overseas visitors, but also for our own population. It is almost impossible to pick out any one of the cultural facilities and assess the impact it has on tourism. One cannot just say that one brings in so many people and that another brings in so many. What we do know is the collective contribution of these facilities. We know the impact they have on our visitors. Just as London, Washington and Paris attract millions of visitors, both domestic and international, because of their fabulous museums, galleries, historical monuments and theatres, so too in the future will Sydney, Canberra and the other major cities and destinations in Australia have those sorts of attractions for visitors. Imagine for a moment what London would be like without the Tate or the Victoria and Albert Museum; Paris without the Louvre; Washington without the Smithsonian museums? People do not flock to Washington to see Congress. They go there because Washington has the most magnificent museums in the world. Many governments recognised long ago the connection between the professional presentation of art, heritage and culture and the tourist dollar, alongside the intellectual, educational and interpretative values to their own communities. To some extent we in Australia have too, as the previously mentioned projects that have been built during the past 15 years or so indicate. In Canberra, the nation's capital, in recent years we have gradually added national cultural institutions that are making this city a place worthy of a visit. In 1982 the Australian National Gallery was opened. In October 1983 the National Film and Sound Archives was established and moved to the former building of the old Institute of Anatomy. The National Science Centre has just opened and, of course, earlier this year the new and permanent Parliament House was opened. Canberra is at long last obtaining the national institutions that will make it truly the national capital and a destination for domestic tourists and international tourists. Why then are we making this retrograde decision not to proceed with the one major national institution Canberra so desperately needs? The obvious explanation is that the cost of around $100m cannot be afforded in these difficult times. I do not accept that explanation. Having been the Minister for 4 1/2 years I am aware of the background of opposition that occurred from officers in the Department of Finance who have never ceased to do everything possible to abort this proposal from the moment of its conception. We need very briefly to go back to the days of the Whitlam Government when governments were being bombarded with requests for assistance to existing museums and demands that they build a range of new national museums dealing with everything from sport, immigration, Aborigines, aviation, maritime history, children's institutions and many others. As a result of these pressures the Whitlam Government commissioned the Pigott Committee of Inquiry on Museums and National Collections which in its final report, among many other recommendations, suggested that the Federal Government restrict its activities to three national museums-a national maritime museum, a national aviation museum and a museum of Australia. The maritime museum is under construction in Darling Harbour and will open next year. The national aviation museum is in limbo and although it is likely to be located in Victoria it is not known when that will occur. The Museum of Australia, however, had the support of the Fraser Government which selected the excellent site at Yarramundi Reach near Black Mountain. The present Government has progressed to opening an attractive visitors centre and gradually building up the staff and the collection. When it is eventually built it will provide a unique perspective on Australia's history by having three separate yet interlocking themes-Aboriginal man, European man, and the environment and their impact upon it. None of the other museums in Australia, almost all of which are in the State capitals and are really nineteenth century style collecting institutions, deals in an effective way with Australia as a nation. Although they have some excellent collections and dedicated staff, largely because of the restriction placed on them by their very structure and style, they are incapable of drawing together all the themes I mentioned earlier and presenting them in a comprehensive, educational and entertaining fashion. I do not have the time to go into the fascinating, even exhilarating, presentation planned for the National Museum. It will be, if it ever proceeds, one of the finest museums in the world. The problem is that we will be lucky to see it in my lifetime while ever the philistines in Finance have their way. When we were first elected, I too became conscious of the pressures to extend our activities in more and more museums. The Film and Sound Archives apart, which incidentally was already a part of the National Library, I adhered to the view of the Pigott report that we should limit our activities to the three museums recommended by that report. However, I found myself up against violent opposition from Finance. After a prolonged battle, it was decided to have a museums review in which all the issues would be covered. All this did was ensure that a decision about the National Museum of Australia was delayed for a further couple of years. The fact is that the people on the review could never reach any basis for agreement. The philosophical gap was too great. I never objected to the Department of Finance saying, `Look, we do not object to the principle of a national museum; it is just that we cannot afford it now.' I could have lived with that. In fact, aware of the financial difficulties the Government was facing, I suggested that the museum be introduced in three stages: a gallery of Aboriginal Australia to be opened this year-the year of our bicentennial; the next phase between 1988 and the year 2001; concluding, for Federation, in the year 2001. What happened-and the people of Australia need to know this-is that the officers from Finance were opposed to the concept that the Federal Government had any responsibility for involvement in museums at all. In the best traditions of Ayn Rand, Milton Friedman and the New Right, these philistines argued that museums were not the responsibility of governments. They advocated not only that we should not build a museum but that the national collection should be either sold off to the private sector or given to the States. `Why would anyone want to come to Canberra to look at a national collection anyway?' one cretin asked me. I suppose it is too much to expect some Class 11 clerk to have anything called vision. But if these particular individuals had been making the decisions in Paris or London in the last century, I wonder whether they would be the cities they are today. These fools-I call them fools, without equivocation-seemed incapable of realising that we were making decisions not about the national capital for the 1980s but about the national capital for the next century and beyond. What concerned me most was not that these people were giving advice about whether taxpayers' money should be spent; that was their prerogative. I was appalled that these people were giving philosophical advice that was clearly at odds with the philosophy of the Australian Labor Party. They were telling Government Ministers what their philosophy should be. They were saying it was not government's role to preserve the nation's heritage. In my view, they were quite out of order. They had no right to go beyond their level of expertise. They usurped the Government's role as a policy-maker. I am disgusted at the decision of the Government not to proceed for five years on the National Museum of Australia. I accept that there is a case for a phased building but not a shutdown. We are going to waste millions just keeping the present collection in mothballs. I ask the Government to reconsider this decision. Mr JULL(Fadden)(9.24) —I am delighted to enter this discussion, especially after my colleague the honourable member for Robertson (Mr Cohen), and I have a great deal of sympathy with what he has said tonight. He may not realise it, but it is almost 10 years to the day since the House of Representatives Select Committee on Tourism report was tabled in this House and the honourable member for Robertson was a most distinguished member of that Committee and much of what he was talking about tonight was the line that he was taking all through that inquiry, and he obviously has proved to be a man of some vision because we have seen in recent years the benefits that all that infrastructure he was talking about has brought to Australia. I was fascinated to hear his description of the Department's attitude towards Canberra. I understand that, as of today, we are very close indeed to receiving the one millionth visitor through the new and permanent Parliament House. That is an amazing situation-that we have had one million people coming through our doors already. If Canberra is such a boring and dreadful place, it seems amazing to me that people would bother to come here and see this place that has been hailed as the greatest waste of money and has received so many other descriptions that defy mentioning tonight. It is indicative of the attitude of certain sections of the bureaucracy, and that was the theme of my contribution to the Estimates tonight because 10 years down the track we must do some very considered thinking indeed if we are to make sure that the so-called tourism boom that we have on our hands at the moment will continue. Mr Cohen —We were right 10 years ago and they were wrong and they fought us then, if you remember, on tourism. Mr JULL —The honourable member for Robertson is perfectly correct. I will never forget a certain group of gentlemen who came from Treasury and at that stage they were asked what they thought of the contribution of tourism to the Australian economy, and the answer was that they did not know. We suggested that maybe it would be a good idea if they found out, and we received a shrug on that. We asked them what was the potential contribution of tourism. Not only did they not know, but they did not really care. Their attitude was that it was a froth and bubble industry, one of those things that was there and one did not have to worry about it. It is now Australia's fastest growing industry and one of our biggest employers and, in terms of the contribution to the hard currency that we are earning from around the world, it is our second biggest income earner-despite the bureaucracy. We are hitting a situation now that if we do not get our act together 10 years down the track, we may blow all of that good that has come to us and to our economy from the tourist dollar. One thing that has always concerned me-and I spent some time out of this House working in one of the State tourist organisations-and it still concerns me, is the lack of identification by many sections of the bureaucracy of what tourism is all about and what contribution can be made by tourism. It is sad that we have got so far down the track but still miss out on that coordination. It exists in the State bureaucracies as well as in the Federal bureaucracies. One of the great points about the Opposition's tourism policy recently released is a recognition of that and a recognition that there must be a coming together of all sections of the industry, in terms of the private sector and in terms of the various government departments. Ten years ago that was one of the things that were identified. Tourism was identified as being an industry that was fragmented, that had no capacity to come together to be able to put its case. In terms of the private sector, through the Australian Tourist Industry Association we have seen a coming together of the private sector, but still we lack that coordination in some of the government departments. There are many areas that one can cite. One can cite the lack of coordination between the Department of Aviation and the tourism department. I do not think there is much coordination between the Transport Department and the tourism department. There are all sorts of interdepartmental committees set up from time to time and all sorts of consultative bodies that meet from time to time, and I have been to a number of those meetings. They are very pleasant. One sits there for two days and has a nice lunch, talks to one's fellows from other States and makes all sorts of great and powerful resolutions. Then one goes away-and absolutely nothing happens. The arguments we were having about four and five years ago when I was in that scene are still going on today. It is about time we started to get our act together if we are to benefit from the potential that is still there for Australia. I think it was John Rowe who said the other day that the Australian tourist industry is not in the middle of a boom. We have just caught up. We are up there with the rest of the world. We really have to make every hit a winner. I think he is perfectly correct. I would never debunk the contribution that has been made by Paul Hogan and his advertising campaigns in the United States, but I wonder whether we are concentrating the expenditure of the tourism dollar in the right places. It is a fact that the real potential for international tourism into Australia at the moment exists from South East Asia. It is a fact that the biggest potential growth market is Korea because it is now lifting the visa requirement. There is a huge market that is ready to flow out of that country into this part of the world. There might be all sorts of diplomatic problems with Taiwan, but it is opening up to the world and the Taiwanese are now tourists. Interestingly enough, despite the fact that we do not have that recognition, despite the fact that we do not have the air routes, the Taiwanese visitors are coming here now. If one goes to the Gold Coast one sees plenty of them. But have we had any great debate about how we are going to handle the situation of the Taiwanese coming here? The whole area of direct air routes with Korea-- Mr Shipton —And Taiwan. Mr JULL —Taiwan has been under debate for at least eight or nine years. We do not really seem to be much further down the track. We are continually told that the situation is being monitored. It does take time to get these things into place. If a decision were made now to open up those air routes it would take 12 months, 18 months or two years to get into that market. How much concentration is there in the Australian Tourist Commission and the Department to make sure that we have the capacity to tap that particular market? Are we still in a situation where very little is done between departments? That is a real worry. I think Australia has come a long way, as the honourable member for Robertson said earlier, in providing that tourism infrastructure. However, there is other planning we have to do. While I do not necessarily want to promote the concept of a strict, hard and fast government dominated and inspired tourism development plan, there must be some sort of plan for Australia. As I say, we have had a lot of development and that infrastructure is serving us pretty well, but there are a lot of people in the industry who will get their fingers burned because of bad investment decisions. There are instances where some very bad advice has been given, often to developers, by private companies. I wonder, in the geographical sense, whether we have really thought very much about where our future development should go. I wonder how much involvement there has been with the geographers of Australia in the planning of resorts and the best use of our heritage and our natural attractions. I suggest that the answer to that is that there has been very little involvement indeed. I honestly believe that we are facing a most critical time. The decisions that will be made within the next two or three years are certainly going to determine whether Australia has the capacity to catch up and cash in on that tourism boom. As people who have been involved in the government side of the growth of tourism for the last 10 years, we have a very real obligation to make sure that the bureaucracy gets the message that we have the coordination and the capacity to get together private industry and government departments to make it work. We have to make it work. It is the only growth industry that has the capacity to provide jobs for the young people of Australia. We have 400,000 people who are involved in the industry now. The potential for job creation in tourism is really unlimited. Mr CHYNOWETH(Dunkley)(9.34) —I would like to say a few words about tourism before I move on to the subject of the environment, about which I am particularly concerned. Tourism has come from virtually nowhere five years ago to where it is today through the changes that have been brought about by this Government. As has been mentioned, many jobs have been created. However, I do not think we should put all our eggs into one basket. I would not like to see our economy relying on tourism alone. If anything went wrong in the world economy or things got a little tight, I am quite certain that tourists would not come here. However, the tourism industry is most important and I applaud the Government for what it has done for it. This evening I wish to speak about some of the pressures on our environment, which are increasing every minute. Every new human being that is born is increasing the pressures on everything in this world. What happens in the rest of the world affects us here in Australia. Our planet's resources are not infinite, they are very limited, and we must all make certain that we do whatever we can to protect our environment. The classic battle between the environmentalists and the mining industry is an area which concerns me. It has been going on for many years and it will continue. I believe that mining and the protection of the environment can be compatible. We just have not reached that stage yet and I do not think the necessary technology has arrived yet. I can foresee that in the future even national parks will be mined. They will be mined by some sort of robot that digs under the ground and extracts the ore selectively without creating any waste. If something goes wrong, for example if the roof falls in, they will just send in another robot. Those sorts of things will happen. We have not got to that stage yet, and while we are waiting to get to that stage that is where the battle is. We just have to hang on. I would like to quote one example of what has happened in Victoria between Western Mining Corporation Ltd and the Victorian Government. The Victorian Government's protection of a colony of extremely rare squirrel gliders and three species of orchids near Stawell has angered the Western Mining Corporation. The managing director of Western Mining, Mr Hugh Morgan, said: The protection would affect Western Mining's capacity to extend its mining operations into Stawell and the local people would make a judgment on the wisdom of their decision. The judgment was made on 1 October. Obviously the people of Victoria did not want Western Mining. This epitomises the battle between the environmentalists and the mining industry. Here we have a huge company making large profits and trying once again to exert its control over government and the majority of the people. I guess that Mr Morgan would say, `So what. Why worry about a few squirrel gliders and three species of orchids?' As a government should we say, `Why should we worry about these particular things? Maybe they are found somewhere else'? We should look carefully at what these large companies are doing. They are exerting continual pressure on government and people. Huge amounts of money are going into expensive advertising campaigns. One has only to look at what some of those people in the forest industries are doing, with the glossy literature that comes across our desks every day and the big ads they put in the news- papers. They are really trying hard to break down what has been built up over many years amongst the large number of people who are concerned for our environment. It is a battle that will rage on but I am quite certain that we environmentalists will win. If Mr Morgan and his company did destroy some endangered animal or rare orchid, maybe we should say to them, `You have killed off that orchid. You will have to produce another one'. Maybe with genetic engineering or some new technology they could do it, but it would cost a lot of money. How much would it cost? I do not know. It may be millions of dollars. That is the sort of proviso we should put on these companies. A lot of them do not care at all for our environment. All they are interested in is a short term gain and how many dollars they can make in a week. Tourism and conservation go hand in hand. The majority of tourists do not come to Australia to look at buildings, even though we have been told that a lot of Australians come to this building just to have a look at it. The majority of tourists come out to look at our outback and our environment-the Olgas, Ayers Rock, Kakadu, the Great Barrier Reef and South West Tasmania. They are the sorts of things people want to look at and they are the sorts of things we have to look after. Just imagine the situation if we had let the Hugh Morgans of this world loose: none of those areas would be left. What would happen to our tourism industry? People would not come. They do not want to see a Ranger uranium mine and a great hole in the ground. They do not want to see radioactive tailings running into creeks and things like that. They want to see the environment in its natural state. Australia is a very rich country and it is in a unique position. We can afford to put aside these areas. We do not have to mine and we do not have to cut down trees. We are very lucky. If we can afford to prevent that and prevent it for the next 10 years, I have no doubt that our children, who will be in positions of power then, will not allow it to happen. When I go around my electorate I speak to many schools. There are always questions on the environment such as, `What are we doing to protect it?'. As I have said before, I am certain that our children will make sure that it is kept. I bring up another tourism subject, the floating hotel. This hotel is owned by Barrier Reef Holdings. Just recently it recorded a loss of $4.18m for the year. I should not be saying, `I told you so', but a couple of years ago I made a speech about the dangers of this type of operation. I said that I did not think that it was viable and that I thought it could get into a few problems. It has had quite a few problems. It is a new idea and it is on an extreme learning curve, but obviously it has created many problems. Honourable members will remember that there was an island near the floating hotel- (Quorum formed) The DEPUTY CHAIRMAN(Hon. J. D. M. Dobie) —Order! The honourable member's time has expired. Mr ALDRED(Bruce)(9.46) —We are debating the estimates of the Department of the Arts, Sport, the Environment, Tourism and Territories. I intend to address the very strange events surrounding the Government's No. 1 policy goal-the establishment of a casino in Canberra prior to Australian Capital Territory self-government. On 8 December 1987 the then Minister for the Arts, Sport, the Environment, Tourism and Territories-the honourable member for Parramatta (Mr John Brown)-announced that Federal Cabinet had agreed in principle to a major development representing an expected $400m investment for section 19 in Civic. However, the former Minister's claim of a $400m investment in the development was ridiculed by an independent feasibility study which valued the development at $129m. To that figure needs to be added the cost of a library and theatre, variously estimated at $40m, giving a final figure of $169m. As can be clearly seen, there is a $231m discrepancy between the Government's figures and those of the independent feasibility study. Whilst I am speaking of the costs involved in the development of Canberra's section 19, I refer the Committee to the Canberra Times of 13 October last. As reported in that newspaper, the release of a report by Sydney theatre consultants Tom Brown and Associates detailing the need for an new arts centre in the ACT was immediately used by this month's Minister for the Arts and Territories (Mr Holding) in another desperate attempt to force the people of Canberra into accepting a casino. It was the same old threat: no casino, no arts centre. I say to the Minister that the people of Canberra are not so easily intimidated. Their continuing strong stand against Labor's casino is as firm as ever. A not insignificant sum of taxpayers' money was spent by the Government on establishing an informal social impact study team to obviate the need for a formal environmental impact statement and to fulfil the substance of the law relating to the requirements under the Environment Protection (Impact of Proposals) Act. The study team in its final report, despite the fact that it was a less than confident report, gave the go-ahead to the Government's proposal and, in doing so, exceeded its terms of reference. Despite the go-ahead, paradoxically in its report the team said: The message the industry conveys is that the comprehensive regulations used in this country have prevented any misconduct or illegal activities in the casinos. However, the team has found that Australia's casinos are not completely trouble free as some reports would suggest. Contrary to much of the rhetoric about the `squeaky clean' nature of Australian casinos, there in fact have been some control problems associated directly or indirectly with Australian casino developments. The report went on to say: Laundering as a major problem in casinos, particularly as it is often linked with drug trafficking. Later the report added: If a casino is ever built in Canberra, the team would expect the issue of laundering to pose serious problems for Canberra regulators, as it has elsewhere. The report continued: The team was shown evidence of an unsuccessful attempt in Australia to `plant' members of a crime `family' in casino operations. Police who have been closely involved with casino investigations and gaming law enforcement presented a view that while the licensing and investigation procedures seem to have been successful in the short term, they were concerned that the problem could escalate in the long term. The study team did not identify in its report the casino in question. However, I can tell the Committee that it was the Adelaide casino. The expensive taxpayer-funded study raised one example in its report. I wish to add examples of other incidents which have occurred in relation to Australian casinos in the 1980s and late 1970s. An offender charged with fraud offences on a major building society was found to be in the process of organising a worldwide stud poker championship with a casino being the final venue. Evidence is held by police that an amount of $500,000 was to be invested in the venture by the late Carlo Gambino, head of the New York Gambino crime family and boss of bosses of the American Mafia. A former Lieutenant-Governor for the State of Nevada tried to negotiate equity participation in an Australian casino project through a British merchant bank, allegedly involving an amount of $20m. At the time the applicant was the subject of investigations by United States authorities in respect of money paid to organised crime figures, including Jake Lansky, out of the profits of a Nevada casino. There is the case of a former Australian State police deputy commissioner being involved with a Macao casino group and this group's connection to an Australian company being the parent company of a casino operator. Then there is the case of the American hotel operator being granted a casino licence in Australia, notwithstanding evidence to the effect that a similar licence application by that operator in the United States had been refused because of incidents and associations involving organised crime identities. In addition, there is the matter of a misleading prospectus for one casino project. I could stand here all day quoting further examples; however, I think I have made my point sufficiently on this occasion. Numerous cases similar to these, presented in confidential police material to casino inquiries in New South Wales and Victoria, were key considerations in not allowing casinos in those States. One of the many Trojan horses used by the Government against the people of Canberra has been the much touted tourism bonanza. However, Australian casinos have not been particularly successful as long or short term tourist drawcards. For instance, Cairns, in far north Queensland, has recorded much stronger tourism growth without a casino than Townsville with a casino. Over recent years the financial press has often reported that many Australian casinos, large and small, have not achieved expected financial results. A contributing factor has been a lower level of tourist patronage than forecast. To illustrate this point, I draw the attention of the Committee to the May 1987 report of the Sydney stockbrokers, James Capel Rivkin, on three Australian casinos. The report corrected the common belief that casinos could be regarded as tourism stocks, as it rightly pointed out that as the novelty factor dissipated in the first six months, residents of the casino city quickly come to constitute the bulk of the patronage. Another of the Trojan horses trotted out by the Government is the assertion that the revenue base of the Australian Capital Territory needs to be expanded and that a casino will, in large part, address this need. The forecast is that $5.4m to $6m will be raised per year from a casino tax. However, the latest available figures show that the amount of tax paid by each of Australia's five small casinos was well under half this amount. Of these, only Wrest Point, Australia's oldest casino, paid more than $2m, less than half of the estimate for Canberra's proposed small casino. A further shortcoming of the social impact study report is its failure to indicate whether the original revenue predictions for Australia's other casinos were realised, thus allowing a comparison to be made. The James Capel Rivkin report also illustrates the under-performance of Australian casinos. The report begins with the following acid observations: The three listed casino trusts looked like good investments until they began to operate. The sharemarket's initial enthusiasm turned to disgust as all three failed to reach their prospectus forecasts. Now that all three have substantially under-performed the market it is time to look for opportunities. In conclusion, a casino in Canberra will expose the national capital to organised crime infiltration for supposed economic and tourism benefits that are very much in doubt. Mr MILTON(La Trobe)(9.56) —In joining in the committee debate on the appropriations for the Department of the Arts, Sport, the Environment, Tourism and Territories-- Mr Lee —Tell us about Darwin. Mr MILTON —I would like to say something about Darwin. The casino in Darwin, which I have attended on a number of occasions, is probably one of the most successful tourist projects that I have seen. It attracts many people from both overseas and from Australia. Obviously, the honourable member for Bruce (Mr Aldred), who preceded me in this debate, has no knowledge of these things. It is worth recording the importance of the portfolio responsibilities of the Department, which the Federal Government has recognised by increasing the appropriation to $598.7m for 1988-89-a 34 per cent increase over the appropriation for 1987-88. As honourable members will know, the House of Representatives Standing Committee on Environment, Recreation and the Arts is conducting an inquiry into land degradation and the commitment of the Federal Government to environment protection bodes well should the Committee seek funding support for its eventual recommendations in relation to the inquiry. I also commend the Government and the Minister for the Arts, Sport, the Environment, Tourism and Territories (Senator Richardson) for the increased funding which they have provided in support of protection for our rainforests and for the protection of the Great Barrier Reef. Both conservation areas were subjects of reports made by the former Standing Committee on Environment and Conservation and the recommendations of the Committee have been largely taken up by the Federal Government. This is a good opportunity to refer to one of them-the protection of the Great Barrier Reef. We recommended in the report which was brought down in November 1985 that the Commonwealth Government continue to provide funds above and beyond other research funding to allow full implementation of a program of research that was recommended by the Crown of Thorns Starfish Advisory Committee. We also recommended that the Great Barrier Reef Marine Park Authority give urgent priority to developing a research program to develop more efficient crown of thorns starfish population control techniques. There is no doubt that those recommendations were taken up by the Government, and I certainly commend the Government for that. The other report to which I want to refer relates to the protection of the Greater Daintree which was brought down in August 1984. In that case we recommended that the Commonwealth Government complete its assessment of World Heritage status as a matter of urgency and, if the assessment concludes that the area is of World Heritage value, that the Commonwealth Government, after consultation with the Queensland Government, proceed with the World Heritage nomination as soon as possible. Of course, as we all know, the Commonwealth Government did attempt to consult with the Queensland Government. But the Queensland Government chose to be intransigent, not to recognise the value of the area and, in fact, even attempted-it is still doing so-to work against the Federal Government's aim to protect probably one of the most unique rainforests in the world. Another matter I would like to refer to in committee is the problem of feral animals. Whilst the topic will no doubt feature in the land degradation report of the Standing Committee, it is of such outstanding importance that I believe urgent steps must be taken to eradicate feral animals as early as possible. Last weekend the Australian Conservation Foundation held its national conference in Sydney. Dr Mark Stafford Smith of the Commonwealth Scientific and Industrial Research Organisation (CSIRO) Division of Wildlife and Rangelands Research presented disturbing information on the increasing destruction that is presently caused by successive invasions of rabbits, cats, dogs, foxes, buffaloes, brumbies, donkeys, camels and pigs in Australia's huge arid zone. Not only are the arid lands becoming degraded, but, worse still, the feral animals are destroying the natural habitat for Australian wildlife. It was perhaps a bit unfortunate that the Deputy Chairman, the honourable member for Cook (Mr Dobie), was unable to accompany us on that occasion because he had electorate commitments. Unfortunately, some animal liberationists have been calling for a halt to the killing of donkeys and brumbies. It has to be said that such calls are misplaced because feral animals are directly responsible for the extinction of the western quoll, the greater stick-nest rat, a number of species of wallabies and mice, the bettong, the lesser bilby and the dunnart, all of which are, of course, well known to the Minister for the Arts and Territories (Mr Holding), who is at the table. Many other species are close to extinction or exist only in small pockets outside the arid zone. In an article in the Australian of 10 October, Dr Smith was quoted as saying: `Proportionately, the arid lands have suffered worst of all in Australia's generally poor record of native mammal extinctions since European settlement,'. . . `The extinctions are not just a matter of historical interest and philosophical sorrow; they are continuing. They represent an extraordinary loss of a uniquely Australian heritage.' I have already made comments abut the severe cuts in funding for the CSIRO. But I cannot help noting that Dr Smith, as a CSIRO scientist, is undertaking research work of enormous importance for the preservation of Australia's heritage at a time when the funding of CSIRO is being cut back. Perhaps I should warn honourable members that we should not upset CSIRO scientists too much. At present we are all suffering from a plague of bogong moths. I am told that some CSIRO scientists are responsible for this plague and that they actually engineered it! They tell me that if the Government does not restore CSIRO's funding, the next plague will be of European wasps. Mr John Scott —They will get bigger. Mr MILTON —I think we will have to be rather careful. As the honourable member for Hindmarsh says, they could be far more dangerous than bogong moths. I have mentioned how pleased I was at the increased funding for the conservation and protection of the Great Barrier Reef. However, I would again like to point out that these cutbacks in the funding of the science budget must inevitably have adverse effects on the protection of the environment. One cannot view such appropriations in isolation. In this respect I am thinking particularly of the Australia Institute of Marine Science. The Institute is performing excellent research work into the causes of the plague of the crown of thorns starfish for the Great Barrier Reef Marine Park Authority, yet the Institute has suffered a cut in funds which will result in the loss of one staff member for each of the next three years. Obviously the loss of staff will have some effect on the crown of thorns starfish program. The scientists coordinate their work in allied areas of research. Whilst it is commendable that the Federal Government provides increased funding for essential environmental protection, it is shortsighted in cutting back on funding at the same time in allied areas of scientific research which are associated with environmental protection. I had the opportunity last week to inspect an exhibition by the CSIRO Division of Forestry and Forest Products, which displayed research work in support of increased production and the improved conservation of our forests. This display was held in one of the committee rooms of Parliament House. It was an excellent display, for which I commend the Division. But I was most concerned to learn that the average age of scientists employed in the Division is increasing, with nobody under 37 years of age. Why are young scientists not coming to work for the CSIRO? Obviously it is because they are worried about its future. I was glad to see that the Division of Forestry and Forest Products is working on the problem of the greenhouse effect. An understanding of what might happen to the conservation of Australia's coastal zone mangrove swamps, as a result of the rising sea levels due to the warming of the atmosphere resulting from the greenhouse effect, is crucial. Again, such research work is not done in isolation, and the Great Barrier Reef Marine Park Authority, the Australian Institute of Marine Science, a number of university departments and the CSIRO, all work together in attempting to solve these ecological problems. If the funds of any one or more of these bodies are cut, there will inevitably be a negative effect on the total research effort which is so crucial for protecting the Australian environment. I was pleased to note that the Government has decided that it will assist in research on the greenhouse effect and the problems of a possible rising of the sea-levels and the tides for Pacific Ocean countries in our area. Such rising sea-levels could very seriously affect the economies of those countries, as indeed they will affect those in the coastal zones of Australia. Mr Kent —A very good decision. Mr MILTON —As the honourable member for Hotham said, it is a very good decision. It is one that we on this side of the House all applaud. I hope that the Commonwealth Government will take into account some of the comments I am making. We cannot isolate one area of research from another. If the funds for CSIRO are cut back that unfortunately will have some effect on the commendable research work that is being undertaken in the protection of our environment. Mr HOLDING(Melbourne Ports-Minister for the Arts and Territories)(10.06) —I thank honourable members for their contributions to the debate. The honourable member for Gilmore (Mr Sharp), the shadow Minister, spoke at some length about the desirability of increasing funds for sport. I find it interesting that when we get into these debates the Government is continually criticised by shadow Ministers for not spending enough, yet on a daily basis the general policy of the Opposition is to call for more cutbacks in the public sector. It seems to me that sooner or later the Opposition will have to make up its mind whether it is going to criticise the Government for not making enough cutbacks or whether it is going to be selective and have two positions-a general policy of saying, `We need more cutbacks in public sector funding' and at the same time, when it suits it, saying, `Our real criticism of the Government in areas like sport is that it is not spending enough money'. I think that poses some dilemma for the Opposition. My colleague the honourable member for Robertson (Mr Cohen), the former Minister with responsibilities in this area, in my view correctly raised the position of the proposed Museum of Australia. I think the decision that the Government has made not to continue with the funding of the Museum ought to be reviewed. I think we, as a nation, are in an odd situation, particularly in a city like Canberra, where during this bicentennial year there is clearly a focus on our history and achievements and at the same time there is a reluctance to fund a concept such as a national museum. I take the points made by my colleague that there is already a very significant Aboriginal collection which will pose continual maintenance problems if it is not effectively and properly housed. I also agree with him that any museum proposal ought to be staged over a period. Having regard to the development of Australian society, I would have thought, if we are starting with an imposing and important collection in respect of the history of Aboriginal people, which dates Australia back some 40,000 years, that perhaps it is time for the museum itself to become a history of the Australian peoples. We are a multicultural society and there have been great achievements by all the various communities that make up the current mix in Australia. I would have thought that would be a very important and logical starting point for any such museum. I raise this matter in this context because unless there is a Government commitment, I believe those many interest groups in the private sector and in the broader community would not be able to make any significant contribution. A nation that is unable to understand its own history cannot, I think, effectively plan its own future. So I adopt much of the argument put by my colleague. The honourable member for Bruce (Mr Aldred) is well known for his opposition to the concept of casinos. He has consistently opposed them. He sees them as being potential threats in terms of their relationship with organised crime. I say to the honourable gentleman only that that is not in any way part of the history of casinos in Australia. No one would seriously argue that the casino in Hobart, which, like any casino, started amid some controversy, has not had an impeccable record and does not make a significant contribution, not merely to the Government revenues of Tasmania but also to the whole tourism aspect of Hobart. There may be some argument that casinos in other parts of Australia do not make the profit that their operators hoped to make, but I think all of them have made a significant contribution to the tourist aspect of those communities in which they operate. I think the casino in South Australia has shown a great deal of initiative in the refurbishment of an old railway station and its transformation into a very modern, effective and practical building. It also makes a significant contribution to the revenue of South Australia. Whatever may be the problem with some law enforcement agencies in the United States of America and the relationship of criminal figures with casinos, one has only to look at the situation which has unfortunately developed in Queensland, where the existence of illegal gambling activity has played a very significant part in the corruption of a police force. To the extent to which gambling is legal, it does provide, I think, less possibility of that form of corruption taking place. Certainly there have to be safeguards, but I, as the Minister responsible for Canberra, have looked closely at the arguments for and against a casino. I accept the views that have been put. On balance, I believe Canberra, particularly in terms of its tourism and job potential, could stand a casino. I am not talking about some great open gaudy structure; I am talking about the discreet operation which will simply give people alternative forms of gambling. In a community where one can gamble to one's heart's content on poker machines, where one can bet on the races or on Tattslotto, or on any one of a number of gambling devices, it seems to me silly to say that if one gives the people the right to play two-up in a civilised atmosphere that is exposing them to some level of moral turpitude or moral corruption. I believe that, in a society such as ours, giving people real choices in these matters in a properly civilised and properly regulated situation, on balance, provides a greater safety for the community than going the other way. Certainly, in a building venture such as this-it is not just a casino; it is a whole range of community structures including libraries and theatrical complexes-we are looking at the employment of 2,700 people in the building industry and the potential employment of some 1,400 people once the complex is completed. If we are talking about moral obligations, I suggest to the honourable member for Bruce that, while I understand his general attitudes about crime enforcement and his view of the relationship of casinos to those problems, those who want to adopt positions of moral rectitude for Canberra are also under a moral obligation to say what the alternative forms of finance are which will provide continuing employment for some 2,700 people in the building industry and permanent employment for some 1,400 people in these complexes once they are completed. The honourable member for La Trobe (Mr Milton) made his continuing commitment and expression of interest in the preservation of various forms of wildlife. I commend him for that. Certainly, some of the rational arguments that he put forward will bear close examination by me and by the Government Proposed expenditure agreed to. Department of Immigration, Local Government and Ethnic Affairs Proposed expenditure, $210,576,000. Mr CADMAN(Mitchell)(10.14) —The Government, in its Budget for the Department of Immigration, Local Government and Ethnic Affairs in this year, has acknowledged that Australia has currently within it some 75,000 illegal immigrants. The computer services of the Department have been promised an improvement since the current Minister for Administrative Services (Mr West) was the relevant Minister some five years ago. Five Ministers later there have been some improvements but they have not been of the substantial type promised by the then Minister and successive Ministers. This means that the detection of illegal immigrants has been more difficult. The entry of people into Australian becomes less certain and the capacity to keep information services available to the tourist industry has become restricted. There are techniques available to the Department to assure the Australian Government and the Australian people that there is an accurate knowledge of what people are in Australia and why they are here. It is up to date, precise and on line. Of course, this process has raised the prospect of illegal immigrants fighting the Australian Government and the Australian people for their claims of residency through the courts. In fact, half the appeals that are made by illegal immigrants to stay in Australia are supported by legal aid. It seems a crazy idea to me that the Australian people should fund those making a claim to stay in Australia by their own resources, even though those people are illegally here. The cost of this process is not known. Successive questions to the Attorney-General's Department have failed to indicate or glean any information as to the cost to the Australian people of this process. There are known cases where the extent of legal aid has been high as $1m for one single case in the Australian High Court. That is a tragic way of approaching an important area such as immigration and ethnic affairs. The cost that we do know of to the Australian people of illegal immigrants is at least $130m made up of taxes unpaid and of support to illegal immigrants by way of Medicare and welfare payments. As I said, there have been five Ministers in five years in this Department, and the Government, because of its lack of attention to the important area of immigration and ethnic affairs, has reduced a 1983 program which was substantially a program of skilled, professional and managerial migration to one which is substantially unskilled or semi-skilled. The percentage of skilled migrants has dropped from 50 per cent to a current 17, 18 or 19 per cent as Department's estimates for the current year show. That has brought about pressure and stress within the Australian community and, as Dr Stephen FitzGerald says in his comprehensive report, there is grave danger that the immigration program that Australia needs is being rejected by the Australian people. There has been a ramshackled approach to the administration of the Department to the extent that despite advice, the Government faced an out-turn, an overrun, for the 1987-88 program which would have meant an annual intake of 190,000 to 200,000 people. That program had to be short-circuited in February this year to prevent that overrun. There was a substantial overrun despite the action taken by the Government. It was basically in the areas of unskilled and semi-skilled migrants. It is not good enough. The Government needs to give attention to these important areas of administration. The Government has not given the Australian people the assurances that they need in regard to the business migration program. It is an important program and essential to Australia's future. The Auditor-General, in his September report, was extremely critical of the processes for examination and verification that should be conducted in the business migration program. On the other hand, the Opposition parties have released their policies which indicate that there will be care and control taken in the conduct of Australia's immigration program. The program will be carefully controlled and balanced. It will concentrate on those migrants who can supply skill, knowledge, education or investment to Australia. We believe that immigration is important and that it should run at a greater level than it is currently. Immigration should comprise economically independent migrants who are young, educated and employable, who bring and create investment, and who provide a greater capacity for the Australian economy to respond to world pressures. Such an immigration program would allow us to absorb the proportion of the program which is economically dependent, whether it be aged, parents or refugees. It must be balanced in the sense that there should be a capacity to have a migration program which encourages people as they arrive in Australia to be job creators rather than job takers. The Opposition's program is fair and retains close family reunion as a fundamental part of that balanced program, but it does place emphasis on attracting immigrants with skills, capital and a spirit of enterprise. We are proud, as an Opposition, of our part in accepting refugees from Indo-China and offering a safe haven and security for those families under threat. Currently the Government is reducing that program from Indo-China and seeks to ignore some of the claims that people from the communist bloc countries make for refugee immigration. There has been a switch to those who, under the discretion of the Minister for Immigration, Local Government and Ethnic Affairs (Senator Robert Ray), seek to escape right wing regimes, even though they are not recognised as refugees by the United Nations High Commissioner for Refugees. The selection of migrants under our policy will be without regard to race, religion or country of origin, but the Australian Government must have the right to say who can become a resident of Australia. It is important that the Australian Government is in control of the immigration program. That has not been the case. It is not just the criticisms of the Opposition in this regard. Stephen FitzGerald, in his report, clearly enunciated page after page of criticism on the way in which the Government has conducted its immigration program. Many of those comments by FitzGerald are supported by the Australian people. We believe that there should be greater attention than has been given in the Budget to the recognition of overseas qualifications and professional skills to allow people to upgrade their qualifications and to make a full contribution to Australia. We will be offering a new priority to English language programs to allow people to feel at home and to be able to earn their living when they arrive. Australian citizenship will regain the proper emphasis and importance under a changed administration in Australia. We will also be increasing the minimum residency from two years to four years. Illegal immigrants will be denied access to welfare and legal aid. They have no claims except under exceptional circumstances and the claims that they make now are extravagant and not warranted. The migration selection procedures will be streamlined under our administration, and people will know whether they can come to Australia, instead of waiting in long queues and perhaps becoming illegal immigrants or queue jumping. In our services to migrant communities, we will be placing emphasis on the needs of aged migrants, women and migrant families in the home, at school and in the workplace. Mr WRIGHT(Capricornia)(10.24) —I wish to target my comments in the area of local government because it has been an issue in recent times that has created some controversy. Regrettably it tends to become a target for political debate as people move around this nation trying to make out that the Hawke Government is not really concerned in that third level of government. It certainly is untrue and it is like the sorts of things that are being said about pensioners. We need to overcome those wrong perceptions. The Hawke Labor Government has endeavoured to assist local government; in fact, it has done more in recent years than I think has happened in the last nine decades of the Commonwealth Government. It has endeavoured to raise the national profile of this very important third level of government; it has endeavoured to develop its capacity to serve the people of Australia; and, I think from a very important aspect, it has tried to involve local authorities in national decision-making by involving their representatives. There has been a long term commitment by the Australian Labor Party generally-that has certainly been shown by this Government-to expand the role and image of local government in the Federation. Whilst that might be a subject for debate-we have a Federation in Australia-it has been this Government, the Labor Party in government, that has tried to ensure that local authorities are recognised at every level. That was certainly true in the last referendum, a referendum that was defeated when we tried to have local authorities recognised in the Constitution. Mr O'Neil —Did you support that hard? Mr WRIGHT —I supported it hard because I really believe it was the wish of the 837 authorities throughout this country; it was certainly the wish of the majority of the 134 local authorities in Queensland. But the referendum was defeated, and we have to accept that. Again, the Labor Party established the first ministry for local government. I specifically refer to the Hon. Tom Uren because of the role that he played as part of the Whitlam Government in establishing a new profile for local authorities. He tried to enhance their position and their functions. This Government provided the first direct participation of local authority representatives in the key consultative forums and advisory bodies. I mention the Economic Planning Advisory Council, the Australian Housing Council and the Federal Airports Corporation. Again, the Hawke Government established the local government development program. Since 1983, we have invested some $15m in research, development and training projects to expand the capacity of local government to enhance its efficiency to deliver the services and respond to local needs. It is often said that this is the grass roots level of government and that it has to meet local needs. Again, the Hawke Labor Government funded some 600 projects. We introduced the national awards for innovation in local government which were designed to recognise the achievements of local government, to encourage innovative practices and promote the sharing of ideas and experiences. Again, the Labor Party in government instituted the national inquiry into local government finance. This was certainly necessary because, whilst we talk about efficiency and expertise, so much of what governments can do, regardless of what level, depends on the money that they have. Following that inquiry, again this Government introduced the system of untied grants, a new local government financial assistance scheme, a new Act, that gave a new emphasis to the more disadvantaged councils. Regrettably, we found in Queensland that often the money was distributed not on a basis of need or population, but on political ideology. We found regrettably, with Sir Robert Sparkes, that a council that he had a link with always seemed to get more than it deserved in comparison with the more needy authorities. We introduced the concept of requiring local government to be consulted in determining the principles governing the distribution of funds. It had not happened before. We hear the National-Liberals talking about how they have tried to involve all levels of government, being mindful of the fact that in most country areas it is National Party type supporters who involve themselves in local authorities. Again, the Labor Party saw the need to involve local authorities in determining the bases of funding. We have recognised that the effectiveness of local government depends on its resources, as I said. In 1987-88, the Hawke Government provided over $1.1 billion to local government, a level 50 per cent higher than the last year of the Fraser Government. So, for every dollar that the Fraser Government was giving for local authorities, we are now giving $1.50. That certainly has some significance. This represents an average of 3.54 per cent of personal income tax collections during the Hawke Government period, as against just over 3.01 per cent during the Fraser years. Again, not only have we given them a voice, but also we have given them a new financial capacity. In 1988-89, local government will receive $652.5m in general purpose grants. One can add to this the improvement in the operations of the Local Government Ministers Conference. There is greater cooperation with the States and greater input coming from these local authority areas. There is constant pressure for more money. That will always be the case because every government thinks that it deserves more and has reasons for having more funds. Again we have seen the need to have an ongoing review and monitoring of funding that is available. In the four minutes that I have left, I raise the need to review not only finances but also the functions and the general roles of local authorities. I pulled out some figures in the State of Queensland. It is quite amazing to see how widespread those local authorities are and the limited number of people they represent. If one starts to look at the economies of scale and unit costs, one starts to appreciate that we need to become far more efficient in those areas where funds are available. For instance, the Aramac Shire has 1,100 people; the Barcaldine Shire, 1,850; the Barcoo Shire has 600 people; it has 10 representatives, but 600 people. The Bendemere Shire has 1,200 people, the Biggenden Shire, 1,600; the Boulia Shire, 750; the Burke Shire, 1,000-- The DEPUTY CHAIRMAN(Hon. J. D. M. Dobie) —Order! It being 10.30 p.m., in accordance with Standing Orders, I shall report progress. The Deputy Chairman having reported accordingly-- Mr DEPUTY SPEAKER(Mr Rocher) —Order! It being 10.30 p.m., I propose the question: That the House do now adjourn. Mr Holding-I require that the question be put forthwith without debate. Question resolved in the negative. Consideration resumed. Mr WRIGHT —I was relating to the Committee some of the figures I have gleaned from a study of the shires in my own State of Queensland with the intention of pointing out how difficult it must be for those shires, with limited numbers of people and therefore a very limited rate base, to carry out the functions that we expect of them. I mentioned a number of shires and go on to point out that the Bulloo Shire, with a population of 680 people, has five representatives; Diamantina has 300 people in its whole electorate and seven representatives; Croydon has 200; Isisford, 500; Ilfracombe, 380; and Tambo, 770. We are talking about very small shires. For example, the Shire of Perry in central Queensland has a population of 330 people and 10 representatives. Surely there is a need to start rethinking the boundaries of our local authorities. I am not advocating the Whitlam era of regionalism; I am talking about a regrouping and a restructuring of local authorities throughout this nation. There is clearly a need to ensure that these authorities are efficient. As honourable members would appreciate, grants are given on the basis of population and on the basis of need. However, when we are dealing with a shire such as Croydon, which has 200 people and must pay a shire clerk and back-up personnel, it is no wonder that these shires carry an enormous financial burden. I appreciate also that many shires are undemocratic in their structure. Let us take the Shire of Mount Morgan, for instance. Some 2,000 people in the township of Mount Morgan elect five people. In the surrounding division of the Mount Morgan Shire three members are elected by some 57 electors. Regrettably, that is a typical National Party structure. However, setting that aside for a moment, I make a plea that the Commonwealth play its part in trying to bring together the 835 local authorities plus the Aboriginal shires throughout this nation; that it start talking of a restructuring of their boundaries and functions and of an amalgamation of activities-a cooperation that exists in some areas following experiments. Surely, in spending over $600m in direct grants and general purpose grants, we need to ensure that the money is spent in the best possible way. We need to ensure that those people who benefit from those moneys get the best benefit possible. I do not believe that that is going to happen when we have shires such as Ilfracombe with a population of 380 people and eight representatives; Isisford with 500 people and six representatives; and Perry with 330 people and 10 representatives. There needs to be a restructuring. Maybe we can take a leaf from the Whitlam era and realise that what he was saying in trying to establish a regional government structure has much value. The DEPUTY CHAIRMAN(Hon. J. D. M. Dobie) —Order! The honourable member's time has expired. Mr PRATT(Adelaide)(10.34) —I rise to speak on Appropriation Bill (No. 1) 1988-89 and the estimates for the Department of Immigration, Local Government and Ethnic Affairs. I have had the opportunity both privately and publicly to speak at length on this subject. I preface my speech around the one Australia policy in the context of the immigration debate. I was involved with an Australian Broadcasting Corporation Four Corners program. The honourable member for Calwell (Dr Theophanous) may laugh. One facet of my involvement was the role I played for the Japanese NHK TV production Under the Shade of a Coolabah Tree. I was derided by some middle class Australians who thought that that portrayal was beneath the dignity of Australians. The Four Corners crew travelled around a marginal seat in Adelaide trying to get an assessment of the views shared by people following the immigration debate that was raging in Australia several months ago. I am very comfortable with the one Australia policy. In the few minutes I have in which to speak I hope to be able to elaborate more on that. What disappoints me is the interpretation of the immigration policy by sections of the media-an interpretation fuelled by the Australian Labor Party and the Hawke Government. Dr Theophanous —Do you mean that they tell the truth? Mr PRATT —The honourable member will have the opportunity to understand that it was his Leader and Prime Minister (Mr Hawke) who said that he wished to send Indo-Chinese refugees back to where they came from. By the admission of the FitzGerald Committee to Advise on Australia's Immigration Policies, as referred to earlier by the shadow Minister for immigration, local government and ethnic affairs, the honourable member for Mitchell (Mr Cadman), under this Government five Ministers have attempted to service the immigration portfolio. I honestly believe that immigration is still vital for Australia's future. The statement `populate or perish' is still very true and evident. I stand by my public statement that race should not play any part in our migration selection process. It is a cornerstone of the Opposition policy and is stated in our policy document. Let me dwell on social cohesion. I am reminded of an article written by the late and great Professor Julius Sumner Miller. He was asked: `Do you think the world will find peace? Will countries and nationalities find peace with each other?'. He may even have prefaced his answer with, `Why is it so?'. He said: `Families, brothers and sisters have irreconcilable disputes and feuds, yet we are asking and expecting the world to be at peace'. Australia is a very tolerant country. Our social cohesion is not under threat but is perhaps under pressure. Australia is a country only 200 years old in terms of new settlement, yet in the last 40 years we have, as I said, recognised the need to populate or perish. As an emerging country, a fantastic country with a free spirit, we have inherited 150 new and different nationalities, religions and cultures. Of course we are going to be under some sort of pressure, but it is a pressure we can live with and overcome. Certainly, we are not threatened. We have the pseudo allegations that our Asian-Pacific rim trade is in jeopardy. However, Asian traders for centuries have been free traders. They go where the price is right, including coming to this country and paying for education. What about one Australia and multiculturalism? Multiculturalism has not failed Australia or we it, yet the word `multiculturalism' seems to be at the heart of the debate. We have horticulture, agriculture and now multiculture. We love hijacking words and categorising people into areas. We had emigrants, then they became new Australians. They were then known as ethnics. Now we have to know them as multicultures-some new pathologists' yoghurt. My life, my family and my country have been enriched and embellished by the impact of migrants who have come to Australia. I am certainly grateful for and proud of the contribution to our arts, theatre, cuisine, fashion, culture, language and lifestyle. As I said before, Australia has gone from a country, probably 40 years ago, of braces worn outside shirts, felt hats and sauce on our steak to the lifestyle we have today as a result of the impact of migrants. Mr Holding —I still put sauce on my steak. Mr PRATT —We do, but it is a different sort of sauce. Certainly, in Adelaide, my home city, the migrant community has made a considerable impact. I respect those migrants as people who have contributed to the welfare of Australia-as Australians. Certainly, they do not have Anglo-Saxon sounding names. There is Lord Mayor Steve Condors; the builders, the Koiredis Brothers; Michael Angelakis; Caj Amadio; Prino Caeon; Walter Ling-one of the best restaurateurs in Adelaide; Nerio Ferraro, President of the Norwood Football Club, one of the greatest Australian Rules football clubs in South Australia; Wolff Blass; and Max Schubert. They are not Anglo-Saxon sounding names. However, they are the names of people who have come to Australia and made a big impact on our lives, our culture and our future. If we were fair dinkum and analysed the word `multiculturalism' we would have to be honest and say it envelops the ethnic community. It is a name that has been given to the ethnic community. What about middle ground Australia? What title does it afford us? Why do we need a title? None of us needs a title because we have one Australia. Do not let anyone forget that less than 50 years ago tens of thousands of Australian men and women offered their lives in the defence of this country and went abroad to do it. They went to Korea, Vietnam, New Guinea and Hong Kong. Why? To give Australia and Australians a free and democratic country to live in. There is no greater sacrifice than to offer one's life for one's fellow man and country. Yet when we dare to talk about social cohesion, multiculturalism, immigration or of 150 different races, colours, creeds and religion we are branded as racial bigots. I recently attended several Vietnamese functions, including the Children's New Moon Festival at St Clair youth centre. The Catholic church service was ministered by Father Augusta. The music was supplied by a teenage Vietnamese orchestra. I am sure the children would have liked to turn up the amplifiers and get into a bit of heavy metal but the discipline and music supplied cut through any language barrier. Whether you sing Amazing Grace in Vietnamese or English the three-part harmony still has the same meaning. One of my greatest pleasures was to join a group of Vietnamese men and women at Athol Park in Adelaide. These men had served in the South Vietnamese army and had escaped or migrated to Australia even though Bob Hawke said he did not want them. This fundraising barbecue was devised so these dedicated men could raise funds to travel to Melbourne last weekend and march arm in arm with the Vietnam veterans from Australia and around the world. It could have been an Aussie barbecue except that the names were different-Mr Quang, Mr Tran and Mr Ho-but the motives certainly were not. The Prime Minister is always one to try to score a political point, even at the expense of the Melbourne Age today, but he missed out when the Italian President, Mr Cossiga, was here in Canberra. He did not even have the common courtesy to refer to a Labor Party colleague, Mr Con Sciacca, an Italian-born member of parliament. Certainly, Senator Panizza was warmly welcomed by Mr John Howard. What of the one Australia policy? At the Seoul Olympics the soccer team was coached by Frank Arok and skippered by Charlie Yankos and Frank Farina. When it scored the winning goal against the Germans, did we stand as one and barrack for multiculture? We did not because we were respecting Australia, as we did when Duncan Armstrong, Debbie Flintoff-King and the women's hockey team brought home gold medals for Australia. Song of Australia was what we were supporting and I believe in the one Australia policy. Whatever our origin, our background or our birthplace, once we are established here Australia is the country we want to support. The top rating Comedy Company enables us to laugh at ourselves. Con, the Greek fruiterer, I am sure would be a great follower of Dr Theophanous. We can sit back and laugh at our humour. We can laugh at Vince Sorrenti. That is what part of our culture is about. My daughter attends a college in Adelaide. It is not full of Anglo-Saxon sounding names but it is not a multicultural school. It is a school in Australia for Australian students. I support our attitude to migration. Certainly it is not racist and I would not be led down that path. I commend our immigration policy. Progress reported. Motion (by Mr Punch) proposed: That the House do now adjourn. Mr CARLTON(Mackellar)(10.45) —On 29 September last, the honourable member for Capricornia (Mr Wright) moved a motion relating to the League of Rights. This was seconded by the honourable member for Gwydir (Mr Hunt). I do not want to take issue with the terms of that motion but something was said within the speech of the honourable member for Capricornia which has been drawn to my attention as being incorrect. In attacking the League of Rights, the honourable member quite correctly referred to human rights, individual liberties and so on, which should be included in any discussion of the League of Rights. But it is important that the rights of those who were mentioned be safeguarded. The person who has approached me as having been misquoted and, he believes, dealt with in an unsatisfactory way by the honourable member for Capricornia, is Mr Michael Darby. Mr Deputy Speaker, you would understand that Mr Michael Darby, one who in Oxley gave his preferences to the Labor Party ahead of the Liberal Party, is not one who would normally be approved of by the Liberal Party. But I have a concern about the accuracy of reports about people. I believe Mr Darby's rights have to be respected as much as anybody else's in this community. I have received a statement from Mr Darby in reply to the suggestion that he is a leading member of the League of Rights and one of its main apologists which is something put forward by the honourable member for Capricornia. Mr Darby, in a note to me has said: I have never been a supporter, nor a member, nor a leader of the League of Rights, nor have I ever met its director. That is, Mr Eric Butler. He continued: Since around 1959 I have been an opponent of Douglas Credit, central to the League's economic policies, and I have often warned that the League of Rights will jump on any available political bandwagon for the sake of self-promotion. I say this in order to correct the record. I have no reason to believe that Mr Darby is telling me anything other than the truth. I do not wish to detract from the general argument put forward by the honourable member for Capricornia, or the honourable member for Gwydir, but it is quite important that, in raising issues of the kind they did, the individual rights, liberties and prerogatives of the citizens of Australia be respected. I think, therefore, Mr Darby, who does not have the opportunity to reply to these things in this House, should have the record corrected on his behalf. Mr CAMPBELL(Kalgoorlie)(10.48) —Mr Deputy Speaker, Lucindale is one of the more fertile areas of Australia. It is a green and pleasant land down there. Several years ago there was a farmer down in that area, a Mr Lance Hurst. Mr Hurst was a very successful farmer in the area but I think he felt he developed his farm as far as it could go and in middle age he decided he would seek a new venture. He went to Western Australia and bought the Sturt Meadows Station, one million acres in the Leonora Shire. When Mr Hurst bought the station it was very badly run down. It had been badly managed for some time and overstocked in some areas. Fences were in a very dilapidated state. It was a very courageous move and I think he paid more for it than he intended. He and his children and his wife moved in and they have done a very commendable job in returning that station to being a highly productive unit. I was there recently on an Agriculture Department trip, a field day, looking at the soil and pasture regeneration. This field day was actually sponsored by Elder Smith Ltd. One could not help but be impressed by the work that has been done there and it is a great tribute to Mr Hurst and his family. They have spent so much effort, so much money and time in actively regenerating that country. They have had many failures. They have tried many species of plants and they have had some considerable success. One can see with one's own eyes the great benefit they have bestowed on that country. Soil degradation and salinity are the biggest environmental problems facing Australia today. These are problems that face every person in Australia. Everyone, even in the most urban areas, in the capital cities, is affected by these twin evils of soil degradation and salinity. It is to the credit of this Government that we have started to recognise the problem and, for the first time, are funding work in this area. I believe the funding is nothing like significant enough, and over time I expect to see big increases. It saddens me that the various conservation groups, the Australian Conservation Foundation and the Wilderness Society and others, have never really recognised this problem, and I think the reason is that one cannot really pack up the old four-wheel drive and go and look at salinity; soil degradation creeps up on one. Often one can look at country that has a lot of growth and the casual observer would not realise that all the perennial species have gone and that colonising plants have taken over, which have no economic value. They crowd out areas and make it difficult for anything else to regenerate. The Conservation Foundation and the Wilderness Society have never really had an interest in this area, although they have recently started to claim an interest. The Government must grab hold of this agenda as the most important aspect of the environment for Australia and must show leadership and be out there in the forefront, or else this too will be taken over by the these often ill-informed urban-based bodies. To my view, they can have no credibility while they oppose the kangaroo cull. It is absolute nonsense to say to a pastoralist that his cooperation is required and he should reduce his stocking levels and remove stock from an area, and then have that area inundated with kangaroos. One can see in several defence line experiments on Sturt Meadows, where there were absolutely no sheep at all, the amount of damage done by excessive kangaroo numbers. The fact that the Conservation Council and the Wilderness Society will not, despite the overwhelming evidence, support the kangaroo cull totally destroys their credibility in respect to soil regeneration. The irony is that if they are successful and the kangaroo cull is abandoned, pastoralists will be forced to poison kangaroos. Poisoning is far more effective than culling. It will kill all of the kangaroos regardless of age or sex. It will be legal and nothing will be able to be done about it. I do not believe this is what the conservationists or most of the people who support them want, but it will be the consequence of their actions. Their irresponsibility must be recognised and they must come to terms with the reality of the situation and support the good work done by the various departments of agriculture and the pastoralists. In conclusion, I would just like to pay a tribute to Mr Don Burnside, the officer in charge of the agriculture department in Kalgoorlie-- Mr ACTING SPEAKER —Order! The honourable member's time has expired. Mr PRATT(Adelaide)(10.53) —I rise to speak on a subject concerning the lives of young Australians and the future of our nation. The profile is not one of fame and acclaim, usually offered to our sports men and women. I wish to offer my warm congratulations to the Australian Jaycees and their Outstanding Young Australian Awards for 1988. As you will be aware, Mr Acting Speaker, the Jaycees are not a religious group, bearing the initials of our Saviour. The Jaycees have been in Australia as a recognised community body for 55 years, arising out of the Chamber of Commerce junior groups, or junior chamber, hence Jaycees. I wish to pay tribute to the South Australian chapter and its eleventh Anniversary Luncheon held yesterday at Adelaide's Strathmore Hotel, in my electorate. The judging panel-consisting of the Hon. Diana Laidlaw, MLC, Mr Kevin Duggan, QC, Mr Michael Shanahan, Deputy Chairman of the Australian Wheat Board, and Mr Richard Maloney, Chairman and Coordinator-considered seven outstanding candidates, selecting five to go on to the national awards in November. Certificates were awarded to Michael McIntyre, nominated by the Wheelchair Sports Association of South Australia. Michael is truly an outstanding young Australian. He is employed as the activity supervisor at the Hillcrest Hospital and is currently in Seoul competing in the disabled olympics. Joanne Baird was nominated by the District Council of Millicent. Her academic skills in science, chemistry and mathematics are duplicated in music and the arts. Joanne is currently studying at the College of Advanced Education and is a member of the Flinders Street School of Music. Winton Ankor, nominated by the Adelaide Central Mission, shares an interest very dear to me, the learning for life drug education program. Both Winton and I are well aware that drugs are a very real hazard to the school girls and boys of Australia. The learning for life program is a constructive attack on the evils of the drug industry and, as instanced by the drug forum I convened in Adelaide recently, I am totally committed to it. Bruce Macky was nominated by the State Bank of South Australia, a fitting backer for a capable nominee. Bruce has a degree in commerce and administration, with an economics major. Bruce's track record covers a broad spectrum from Harvard University through to scouting. Elizabeth Newman represents the essence of Australian initiative and ingenuity. A self-employed designer, manufacturer and distributor of hand-knitted designer label sweaters, Elizabeth has markets for her Aussie goods in Asia, Japan, the United States and Canada. Testimony to the quality of Liz's endeavour is the Walt Disney corporation giving her the rights to produce garments featuring Disney characters. Gunter Scheide was nominated by the Whyalla Jaycees, where he has administered the finances of the Corporation of the City of Whyalla for more than 10 years. Gunter has displayed an outstanding community spirit, being instrumental in helping to obtain grants for the building of a senior citizens hostel and the upgrading of a basketball stadium. Finally, but by no means least, Peter Schiller was nominated by the Paraplegic and Quadriplegic Association of South Australia. Peter has spent much of his time fighting the ignorance in the community regarding the disabled. With a group of friends, this remarkable young Australian founded and incorporated Alternative Lifestyles for the Disabled. After moving into private accommodation, he set about establishing the First Regency Park Scout Troop. This is the exceptional calibre of the nominees for the Australian Jaycees Outstanding Young Australian Awards. So as the member for Adelaide, it was indeed an honour to be in the company of seven great Australians. Politics, multiculturalism, Jobsearch and the jobs, employment and training scheme were not mentioned once. Another credit was for the president elect for 1988-89, Ms Mary Adams, formerly of Brinkworth, who in the Jaycees fiftieth year is the first woman to hold this position. My congratulations are extended to her and her committee. In conclusion, I think it is pertinent to repeat the Jaycees' creed: We believe: That faith in God gives meaning and purpose to human life, that the Brotherhood of Man transcends the sovereignty of nation, that economic justice can best be won by free men through free enterprise. That Governments should be of laws rather than of men. That earth's great treasure lies in human personality. And that service to humanity is the best work of life. Mr PROSSER(Forrest)(10.58) —The Australian Telecommunications Commission, or Telecom as we know it only too well, demonstrated amazingly poor timing with the release of its annual report last week. As the report was being tabled in the House by the Government, boldly showing a profit in 1987-88 of $777m, a senior executive was announcing to the media that the use of a basic telephone service would cost more after 1 November. Here was a perfect example of Telecom putting its foot in it-a public-owned monopoly with a profit figure for last year almost as much as the Government collected overall in fringe benefits tax, telling Australia, `But that's not enough, we want more and more and you are going to pay for it'. Regrettably, Telecom's revenue-raising activities are a reflection of the Government's mismanagement of the economy. Concern for the plight of ordinary Australians has taken second place in this Government's scheme of things. We have recently seen the Treasurer (Mr Keating), the man who would be Prime Minister, living it up around the world, telling other countries how great he is. Meanwhile, back home families are preparing themselves for the impact of another round of interest rate increases and a lower standard of living. We need look no further than this Government to find the trigger for the latest rise in the cost of local calls. The Government announced at this year's Premiers Conference that Telecom would have to pay payroll tax to the States from July, at a cost of $140m to Telecom. Of course, we all know that in the same breath the Government took away funding to the States of $126m as a result. We now know Telecom's response to the Government's decision. First, phone rentals went up by 7 per cent for businesses and 3 per cent for domestic users, and local calls will cost 21c from next month. An interesting fact is that Telecom will recoup only $108m of the $140m. Clearly, without the payroll tax imposition Telecom could have been in a position to actually reduce the cost of local calls. In reality though Telecom is not in the business of making life easier for ordinary Australians. Since January 1983, the cost of local calls has risen by a massive 62 per cent. In Western Australia Telecom has introduced a way of making money by making others pay for its capital works responsibilities. I refer specifically to Western Australia because I am advised that Telecom's so-called `enterprise projects policy' is being pursued most zealously in that State. Since 1986 Telecom has required developers of semi-rural residential subdivisions to pay for cabling of the subdivisions. I do not plan to debate the merits of the policy at this time, but in a particular case in my own electorate, Telecom's inflexibility and obsession with profit has caused it to override yet again its social responsibilities. Mr Arthur Green began developing a semi-rural subdivision called Roseclif Park Estate in 1982. When blocks went on the market in 1985 Telecom had neither introduced its enterprise projects policy nor advised Mr Green that he would be required to contribute under such a policy when it was introduced. So far as Mr Green was aware, telephone services would be made available upon request, in accordance with previous experience. In fact, Telecom first requested a contribution from the developer six days after the first application was made for a phone connection in February 1986. Mr ACTING SPEAKER —Order! It being 11 p.m., the debate is interrupted. The House stands adjourned until 2 p.m. tomorrow. House adjourned at 11 p.m. The following notices were given: Mr West to move- That, in accordance with the provisions of the Public Works Committee Act 1969, it is expedient to carry out the following proposed work which was referred to the Parliamentary Standing Committee on Public Works and on which the committee has duly reported to Parliament: Stage 2 development of RAAF Base, Tindal, N.T. Mr West to move- That, in accordance with the provisions of the Public Works Committee Act 1969, the following proposed work be referred to the Parliamentary Standing Committee on Public Works for consideration and report: Fitout works at 110 Goulburn Street, Sydney for the northern command and eastern region headquarters of the Australian Federal Police. The following papers were deemed to have been presented on 17 October 1988: Export Control Act-Export Control (Orders) Regulations-1988-No. 14-Export Control (Fresh Fruits and Vegetables) (Amendment). Fisheries Act-Plan of Management- No. 19-Southern Bluefin Tuna Fishery Management Plan (Amendment). No. 20-Southern Shark Fishery (Amendment). Overseas Telecommunications Act-Regulation-Statutory Rules 1988, No. 248. Pig Slaughter Levy Act-Regulations-Statutory Rules 1988, No. 247. Postal Services Act-Regulation-Statutory Rules 1988, No. 249. Public Service Act- Determinations-1988-Nos. 185, 187, 201, 209, 214, 216, 217, 219, 222. Regulation-Statutory Rules 1988, No. 245. Seat of Government (Administration) Act-Determination-1988-No. 1-Listing fees and charges for the purposes of the Community and Health Service Ordinance. Superannuation Act-Regulations-Statutory Rules 1988, No. 246. Veterans' Entitlements Act-Instrument, dated 8 September 1988, varying Treatment Principles.