1998-12-093911REPS165701998-12-09Mr SPEAKER(Mr Neil Andrew) took the chair at 9.30 a.m., and read prayers.Miscellaneous1657165710001CLERKThe Clerk—I present a copy of a petition, Donald Kenneth Ditchburn v. The Divisional Returning Officer for Herbert, filed in the High Court sitting as the Court of Disputed Returns in respect of the Commonwealth Electoral Act 1918 and the election of a member of the House of Representatives for the division of Herbert.Bills1657r7141657Bill presented by Mr Anderson, and read a first time.165709:32:001657Anderson, John, MPMr ANDERSON4K4GwydirNPDeputy Prime Minister10—I move:That the bill be now read a second time.The government is committed to promoting a modern and efficient shipping industry for Australia and, as part of that commitment, is revising the Navigation Act 1912.The first stage of that process, which is to be implemented through the Navigation Amendment (Employment of Seafarers) Bill 1998, is the removal of employment related provisions in the act, which are inconsistent with the Workplace Relations Act 1996 and the concept of company employment. Stage two will involve a comprehensive rewrite of the Navigation Act 1912 to make it a more efficient and effective regulatory tool.The Navigation Act 1912 has its origins in the British Merchant Shipping Act of 1894, and the employment related provisions were originally intended to cover situations where the majority of the crew of a ship were employed on a casual basis, with crew contracted to serve on a particular ship for a particular voyage. At the end of the voyage the crew were paid off, with the employer having no further commitment regarding the employment of individual crew members. With the shift to company employment a number of provisions in the Navigation Act 1912 are no longer relevant.Under company employment the terms and conditions applying to seafarers are matters for negotiation between the seafarers and their employers. Legislative backing for such arrangements, which can be tailored to the needs of individual companies, can be obtained through the Workplace Relations Act 1996.In summary, the major amendments in the bill will abolish the Marine Council and its functions, and will also remove provisions dealing with:. prohibition on demanding or receiving fees for the supply of seamen;. prohibition on using the crew of a ship engaged in overseas voyages for handling cargo or ballast while the ship is in an Australian port;. requirements to enter into a prescribed form of `articles of agreement' covering conditions of employment; and. certain procedures for the discharge of seamen from service on a ship and methods for paying their wages.Abolition of the Marine CouncilThe Marine Council has previously dealt mainly with issues concerning the suitability of seamen for employment at sea and whether there is just cause to suspend a seaman from employment on ships. The council may, for example, be called upon to consider what to do about seamen who report late for work. Under company employment it is the responsibility of the employer to deal with these matters and there is no need for a government appointed body to perform such tasks.Fees for the supply of seamenAt present the Navigation Act 1912 prohibits demanding or receiving fees for the supply of seamen. This provision originally came from the British Merchant Shipping Act of 1894 and was intended to prohibit demanding payment from seamen for finding them jobs. This practice was generally known as crimping.There are many ship management and crewing agents around the world today that specialise in managing crewing matters, including supplying seamen, on behalf of shipowners and charge them for such services. Given this situation and the normal employment practices in Australia, the bill provides for the removal of this unnecessary provision.Use of crew for handling cargo or ballastThe question of what limits should be placed on the work to be carried out by a ship's crew is a matter that should be determined by negotiation between employers and their seagoing employees.While as a general rule shore-side stevedores carry out the loading and unloading of ships, there can be circumstances where it may be quite appropriate for the crew to handle goods that could fall under the broad description of cargo. Examples include the cleaning of holds, where the crew would need to handle residues of cargo and the loading of ships' stores.Requirement to enter into a prescribed form of `Articles of Agreement'Articles of Agreement are in effect a contract of employment between the master of a ship, on behalf of the employer, and each member of the crew. The Navigation Act 1912 prescribes in great detail the procedures and content of Articles of Agreement. As such, this aspect of the act is inconsistent with the aim of the Workplace Relations Act 1996 to give employers and employees a high degree of flexibility in making employment arrangements best suited to their needs.While the bill removes the prescriptive elements covering Articles of Agreement, it still leaves a requirement in the Navigation Act 1912 that a ship shall not be taken to sea unless the employer has entered into an agreement with the master and seamen. Legislative backing for such an agreement can be obtained through the Workplace Relations Act 1996.Procedures for the discharge of seamen and methods of paying wagesDivision 9 of the Navigation Act 1912 contains very detailed requirements covering procedures for discharging a seaman from serving on a ship. These procedures are no longer appropriate under company employment arrangements.However, some aspects of division 9 are relevant to assessing the nature and extent of a seafarer's service for the safety purposes covered by the International Maritime Organisation's Convention on the Standards of Training, Certification and Watchkeeping. These matters will be covered in future by Marine Orders made pursuant to section 15 of the Navigation Act 1912.Division 10 contains another very detailed set of provisions covering how wages are to be paid to seafarers. Clearly, arrangements for paying wages to seafarers are matters that can, and should, be covered under company employment agreements. The bill provides for the repeal of all sections in division 10 except for those which deal with the rights of masters and seamen in respect of claims for wages and repatriation to their home port if the ship on which they are serving is lost or wrecked, or the owner or operator goes bankrupt during a voyage.In conclusion, while conditions in the shipping industry a hundred years ago might have justified the detailed employment provisions contained in the Navigation Act 1912, this is simply not the case today when Australian seafarers enjoy exceptionally good working conditions.The industry itself has recognised that in future these conditions will be reflected in company employment arrangements. Amending the Navigation Act 1912 to bring it into line with modern practice complements that approach. I present the explanatory memorandum.Debate (on motion by Mr Martin Ferguson) adjourned.Bills1658r7081658Bill presented by Mr Anderson, and read a first time.165909:39:001659Anderson, John, MPMr ANDERSON4K4GwydirNPDeputy Prime Minister10—I move:That the bill be now read a second time.In July 1996 the government announced that the Civil Aviation Safety Authority, CASA, would conduct a complete review of the civil aviation legislation in Australia, with the objectives of harmonising it with international standards of safety regulation and making it shorter, simpler and easier to use and understand. This was also an election commitment in the government's Soaring into tomorrow aviation policy statement. The Morris Plane safe report and the Seaview commission of inquiry both supported the need for a review of Australian regulations and standards.The purpose of this bill is to facilitate the findings of the review and provides for the introduction of a new set of regulations which are harmonised with civil aviation laws internationally.The existing act contains various references to the `Civil Aviation Regulations'. These references will be changed to `the regulations' or `regulations made under this Act' or similar. In recognition of the fact that the safety regulation of aviation activities should not be based fundamentally on the commercial nature of an activity, it is proposed that the term commercial be removed from the act by replacing `domestic commercial flight' with `regulated domestic flight'.The amendments also provide for new powers in relation to the retention and destruction of goods seized by CASA during the course of investigating breaches of the Civil Aviation Act 1988 and regulations.The power to retain seized goods for longer than 60 days and the power to destroy seized goods are vested in courts. CASA must apply to courts for orders to retain or destroy the goods as the case may be. The former is required to assist in prosecutions for offences against the act or regulations and is needed in cases where difficulties arise when proceedings are delayed.The discretion to destroy dangerous goods seized is proposed because in practice it is not always possible to return seized goods to their owner, and the airline or Customs do not want to accept the responsibility for the goods after the matter is finalised.Unless such goods are forfeited to the state under legislation relating to property used in the commission of an offence, CASA is required to store them indefinitely. This storage is expensive and has no purpose other than to ensure that CASA does not unlawfully dispose of goods which it does not own. The amendments proposed will permit a CASA investigator to apply to a court for an order that the goods be destroyed where the owner cannot be located or has refused to take possession of the goods.Clarification of CASA's ability to classify the fees charged by CASA under the Civil Aviation (Fees) Regulations as debts due to CASA is also included in the bill. Where regulations made under the act require the payment of a fee, and the fee is not paid by the due date, then the regulations should be able to prescribe a late payment penalty to be added to that fee. Consequently, a provision which enables the making of regulations which prescribe limited late payment penalties to be imposed is also included.The financial impacts of the proposed amendments have been assessed as being low. The regulatory changes which the bill facilitates streamline many CASA requirements of industry and will assist in the manufacture of aircraft in Australia. The bill has no direct budgetary impact. It is envisaged, however, that the regulatory changes which will follow from the bill will reduce the costs borne by CASA in administering the civil aviation regulatory regime.The amendments proposed in this bill will facilitate the long awaited introduction of a regulatory regime for the Australian aviation industry which is not only harmonised with international practice but clear, concise and outcome focused. The government's commitment to deliver this objective has been realised. I present the explanatory memorandum.Debate (on motion by Mr Martin Ferguson) adjourned.Bills1660r7111660Bill presented by Mr Williams, and read a first time.166009:44:001660Williams, Daryl, MPMr WILLIAMS7V5TangneyLPAttorney-General10—I move:That the bill be now read a second time.The Privacy Amendment (Office of the Privacy Commissioner) Bill 1998 separates the Privacy Commissioner from the Human Rights and Equal Opportunity Commission and creates a statutory Office of the Privacy Commissioner. The establishment of a separate office provides an opportunity to further increase the profile, and thus the effectiveness, of the work of the Privacy Commissioner and of the office of the Privacy Commissioner.The Privacy Commissioner plays an important role in the protection of personal privacy. The Privacy Commissioner is an independent conciliator in relation to complaints about breaches of privacy in the public sector and, in limited circumstances, in the private sector. The Privacy Commissioner assists the public sector to develop and implement good privacy practices in accordance with the information privacy principles set down in the Privacy Act 1988, advises the minister and agencies in relation to matters relevant to the operation of the Privacy Act, undertakes educational programs to promote the protection of individual privacy and encourages corporations to develop programs for the handling of personal information consistent with the OECD guidelines. This bill will not change any of the Privacy Commissioner's functions and the Privacy Commissioner will continue to have involvement with both the public and private sectors.The Privacy Commissioner has, to a certain extent, always operated separately from the Human Rights and Equal Opportunity Commission. This is similar to the position in other countries, where privacy and data protection commissioners are generally sepa rate offices. This bill brings the Australian Privacy Commissioner into line with the situation in other countries.The creation of a separate Office of the Privacy Commissioner will formalise the practical arrangements that have been in place to date. The Privacy Commissioner has always operated with her own dedicated Human Rights and Equal Opportunity Commission staff. In addition, the Privacy Commissioner's focus has been somewhat different to that of the other commissioners. The Privacy Commissioner seeks to promote good information handling practices across agencies and organisations by focusing on practices and systems to protect the privacy of individuals. Unlike the other commissioners, the Privacy Commissioner has audit powers, which she uses to fulfil an educative function and allow her to focus on preventative measures. Traditionally, the Privacy Commissioner has emphasised settlement of complaints between the parties, viewing the use of formal procedures for hearing complaints under the Privacy Act as a last resort. In formalising the current arrangements, this bill will provide the Privacy Commissioner and the office the opportunity to further increase the effectiveness of their work.I note that the current Privacy Commissioner, Ms Moira Scollay, will be leaving the office in the new year. I take this opportunity to thank the Privacy Commissioner for the excellent work she has done during her term of office, including the advice she has provided to government, consultation with business and the development of the National Principles for the Fair Handling of Personal Information. The Privacy Commissioner's inclusive and consultative approach has proved invaluable.This bill will provide the next Privacy Commissioner with an excellent vehicle for building on, and progressing, the important work that has been done to date. In summary, the increase in profile of the Privacy Commissioner that will be facilitated by the creation of a separate Office of the Privacy Commissioner underlines the government's commitment to the protection of privacy. I present the explanatory memorandum to the bill.Debate (on motion by Mr Martin Ferguson) adjourned.Miscellaneous1661166109:49:001661Reith, Peter, MPMr REITHWI4FlindersLPWorkplace Relations and Small Business10—I move:That so much of the standing orders be suspended as would prevent:(1) the Leader of the House making one declaration of urgency and moving one motion for the allotment of time in respect of the following Bills: A New Tax System (Goods and Services Tax) Bill 1998 A New Tax System (Goods and Services Tax Imposition—Excise) Bill 1998 A New Tax System (Goods and Services Tax Imposition—Customs) Bill 1998 A New Tax System (Goods and Services Tax Imposition—General) Bill 1998 A New Tax System (Goods and Services Tax Administration) Bill 1998 A New Tax System (Goods and Services Tax Transition) Bill 1998 A New Tax System (Fringe Benefits Reporting) Bill 1998 A New Tax System (Medicare Levy Surcharge—Fringe Benefits) Bill 1998 A New Tax System (Australian Business Number) Bill 1998 A New Tax System (Australian Business Number Consequential Amendments) Bill 1998 A New Tax System (End of Sales Tax) Bill 1998 A New Tax System (Personal Income Tax Cuts) Bill 1998 A New Tax System (Compensation Measures Legislation Amendment) Bill 1998 A New Tax System (Bonuses for Older Australians) Bill 1998 A New Tax System (Income Tax Laws Amendment) Bill 1998 A New Tax System (Aged Care Compensation Measures Legislation Amendment) Bill 1998 ; and (2) (a) the resumption of debate on the second readings of (i) orders of the day Nos. 2 to 10 and (ii) orders of the day Nos. 13 to 16 being called on together;(b) one question being put in regard to, respectively, any amendments moved to motions for the second readings, the second readings, the consideration in detail stage and the third readings of (i) orders of the day Nos. 2 to 10 and (ii) orders of the day Nos. 13 to 16 together;(c) messages from the Governor-General recommending appropriations being announced together; and(d) speech time limits at the second reading stage being 10 minutes for each Member speaking.This motion is necessary to facilitate the debate and conclusion of the debate on the tax legislation, which is currently before the House. The motion and the succeeding motions—namely, the declaration motion and the allotment motion—will set up the process by which we complete the debate, which started on Monday. The declaration motion and the allotment motion follow the conventional practice of the House in setting up a running time schedule for the orderly conduct of the debate so that we can complete the debate and members can return to their electorates for the conclusion of the year and the Christmas festivities.I think it would be fair to say that we have achieved a workable agreement with the opposition as we have had extensive discussions about the process for the conclusion of this debate, as I am sure the member for Fraser will say. The Labor Party would, of course, like more time for the debate, but the government's response is that ample time has been provided for the debate. I will demonstrate that clearly in a moment.We have essentially provided for the matters that have been requested of us by the opposition. They sought some reasonable time for frontbenchers, and 15 minutes has been provided for frontbenchers for second reading contributions. For everybody else, 10 minutes has been provided. That is a sensible means of dealing with the time available to give every member, or as many members as possible, the opportunity to speak. We have provided for a consideration in detail stage in the main GST bill. Obviously that is reasonable as I believe there are amendments the opposition may wish to put at that time. We have also responded favourably to the request that there should be some time—not extended time but 10 or 15 minutes or thereabouts—for consideration in detail stages on the three imposition bills, which again will provide an opportunity for any consideration in detail stage amendments that the opposition might want to put.The upshot of all of this is that there will be a number of separate votes. There will be a vote on the GST and the balance of the package. There will be a separate vote on the income tax bill and the end of sales tax bill—that is, the abolition of wholesale sales tax—which is obviously a key aspect of the package, removing that big tax, much of which is imposed on the business sector. There will be a separate package in respect of four compensation bills. We have worked hard to try to set up a reasonable process for the management of this very important debate. I think this outcome is a fair one to all concerned.The opposition will make the usual claims that not enough time has been provided for in the whole debate, and I will make a number of points on that. This is unquestionably the most significant tax reform in living memory; it is the greatest reform package this parliament has seen. The only comparable precedent would be the tax reform package of then Treasurer Keating in 1985-86. That was a very large and very complex piece of legislation. There were two principal pieces of legislation: the fringe benefits tax bill and the capital gains tax legislation, which was an amendment to the Income Tax Assessment Act.Just by way of contrast, in respect of those two items there was one day's debate each. The capital gains tax bill, for example, was introduced on 22 May and then declared urgent on 27 May. Basically, we had one day's debate on that on the second reading on 29 May and the thing went through. There were 29 speakers on capital gains tax. In respect of the fringe benefits tax, that was also brought in with very limited notice. On 2 May there was the second reading, it was declared urgent on 7 May, and then whipped through the parliament on the one day, 8 May. On 8 May we got in four hours and 38 minutes on the second reading and, on the resumption of the debate, one hour and 52 minutes; so all up it took about eight hours if you take into account the second reading and the like.That does not compare favourably with the fairly extensive debate we have had on this occasion. We will have had four days where the package has been made available—a full week. We could have started on the Thursday. The opposition said that would not have given them enough time to present their arguments for or against various aspects of the legislation, but the fact is that this debate has been raging now for months. With great respect to the excellent contributions by members of the opposition, as you would expect, they simply got up and repeated all the claims they have made about the tax package in general which they have been making for months—which only reinforces my point that we could have easily had an extra day, but that was not accepted by the opposition, so we did not force them to that extra day. So we have had a full week's debate.I should say here that Mr Keating described his package when he brought down his ministerial statement in September 1985 as the most far reaching tax legislation ever to be brought before the parliament. It has certainly been far-reaching. The fringe benefits tax is a major burden on many businesses, and the red tape of course has been exacerbated by many of the policy decisions of the previous government. As a government, we have been trying to wind back the red tape excesses of the previous government. We are continuing to reform that system.Likewise, capital gains tax has been a very heavy imposition on lots of small businesses. In our era we have been trying to wind back some of the imposition on small business and, of course, the Labor Party has been voting to keep the imposition on small business. And that is very important for jobs because small business is a great generator of jobs in the Australian community. The government is pro small business, but the Labor Party have been voting to retain taxes on small business. We have been trying to take taxes off business, and you have been voting to put them on.On the entirely predictable argument, I can pre-empt the member for Fraser who will say, `This is jackboot democracy at its worst; this is an absolute disgrace—a diminution of our democratic institutions. You are taking away the opportunities for members to speak.' He will say we are treating the parliament with contempt. I have heard it all before. It is entirely predictable. He will say it all, but no-one will believe him. There has been no more extensive debate in the Australian community on a topic of major importance than there has been on the question of the major reforms which are included in this legislative package.The other point that generally needs to be made in support of this motion before the chair is that, from the public's point of view, we have just had a big election about tax reform, and they voted for it. That is the bottom line. We have had an election. As people walked into the polling booths in my electorate, and in every electorate around the country, there were Labor signs saying `No GST'.Mr Bevis interjecting—WI4Reith, Peter, MPMr REITH—I won my seat, thank you very much. It has been held for democracy again. People went into that last election with their eyes open. We had the biggest scare campaign run by the Labor Party in the history of politics in Australia, and it was a failure. People voted for sensible reform. As a government, we have a mandate now to proceed to legislate that which the Australian public voted for. There can be no clearer case than the case put before the election. We were up-front, we told people what it was that was being proposed and we had a very extensive debate leading up to the election and during the election itself; and of course the government was returned with a very healthy majority. So the first point I would make in terms of timing is that we are simply doing what we said we would do.DT4CREANMr Crean—It was a mugging debate—jackboots. WI4Reith, Peter, MPMr REITH—I have already said that `jackboots' would be the interjection. I left out `mugging', I must say, Mr Speaker, so let me add that to my—10000SPEAKERMr SPEAKER—The Minister will respond to the Speaker and not to the member for Hotham.WI4Reith, Peter, MPMr REITH—Mr Speaker, it is very wise advice to suggest to us that we do not respond to the member for Hotham. This is one of the clearest mandates you could ever have. We had an election debate over this. We put the issue up; it was clear and transparent. We had a major statement on the policy being proposed. We took it to the Australian people and, sadly for the Labor Party but fantastic for Australia, people voted for it. So we have a mandate for it. Really, it is more than having a mandate for it, though; we have an obligation to do what we said we would do. From the public's point of view, we were voted in to do this and, as far as the public is concerned, we have to get on with it—and that is exactly what we are doing.The election was in October; we are now in the first week of December. I pay tribute to the Treasurer and his team: they have worked hard to get the package in. The package is here. It is a quality product and, from the government's point of view, it is important that this legislation be passed before Christmas. Again, that is what we said we would do. As a government, when we say we are going to do it then we do it, and we get on with it.Another element is to say that we nominated that we would have this matter dealt with by the House before Christmas. I think it is an important element of the whole tax package that we stick to the timetable. It is a long timetable, all the way through to mid-year 2000, but it is important that we stick to it, because with such big changes the community is entitled to have some certainty about the passage and implementation of the package. We are dealing with this issue on a professional basis and I think it will add to confidence in the government's handling that we deal with the matter before Christmas, as we said we would.Opposition members interjecting—WI4Reith, Peter, MPMr REITH—I am not going to spend 20 minutes because—DT4CREANMr Crean—You said that yesterday.WI4Reith, Peter, MPMr REITH—I did not go for 20 minutes yesterday. The reason is simple: this is pretty straightforward legislation. I think it is incumbent on the government to put forward the reasons for what it is doing and to substantiate what we are doing, but I do not intend filling up time for the sake of it, which we had from the opposition yesterday on an absolutely ridiculous dissent motion. We are simply putting up the proposition and making it clear that it is justified. When I have completed my remarks, I will sit down and hopefully we can then get back to the substantive matters so that other members who want to speak will have the opportunity to do so.It is a very important moment in the preparation and implementation of the package. If this motion is passed, as I am sure it will be this morning, along with the two following motions, by the end of business tomorrow, at around 5 o'clock, we will be halfway, in a parliamentary sense, to the implementation of the most significant reform package in the tax area that we have ever seen in this country. That, for me, will be a very significant moment. I first publicly advocated tax reform of this sort back in 1990. I spent three years as the deputy leader advocating the cause.DT4CREANMr Crean—You had 18 months in the wilderness.WI4Reith, Peter, MPMr REITH—Yes, I spent some time in the wilderness, for my sins, but I did not mind doing that because, whilst there are many interjections and much cynicism about politics, for most of us in politics, we are here—no matter what all the other reasons might be—because we want to see important things being done. It will be a very significant moment tomorrow to see the House of Representatives pass this tremendous reform package. It will be a huge tribute to John Howard and his leadership. To put up a GST as part of a tax reform package during an election was one of the most gutsy and courageous things we have seen in this country for a long time. At a time when there is a lot of cynicism about politics, it was one of the greatest acts of leadership on policy that we have seen in recent political history. So it will be a very important moment in the life of the parliament and in our general progress towards a more efficient economy.It will mean, in a parliamentary sense, that we will be halfway to the biggest income tax cuts we have ever seen in Australia. They will be a tremendous boost to incentives for people. That will mean that most Australians will never pay more than 30 cents income tax in the dollar. That one measure in itself will be a tremendous boost to the Australian economy in putting incentives back into the system.It will mean that we will be halfway, in a parliamentary sense, to the abolition of the wholesale sales tax—a tax introduced in the 1930s as a temporary measure, which has been a major cost burden on Australian businesses, particularly Australian exporters. It has been one of the factors—only one, but one of the factors—which has made it more attractive for many Australian businesses to invest overseas and create jobs overseas than to run a business in Australia. That, to me, is very important.The existing wholesale sales tax system, taking all other things as being equal, gives a tax benefit to importers vis-a-vis Australian exporters and Australian producers. In other words, the wholesale sales tax system has been penalising the production of goods and services in Australia. That means it is a tax system that has been actively working to export jobs. The end of the wholesale sales tax in itself will be a huge advance and a tremendous benefit to the Australian economy and therefore will be welcome.We will also, in a parliamentary sense, be halfway towards significant increases in pensions, and that is fair. It is consistent with the support that this government has given to Australian pensioners. So that measure also is important.It will also mean that we are halfway, in a parliamentary sense, to the abolition of taxes on Australian exports. That also is tremendously important. We do have a foreign debt. The answer to slowly reducing that foreign debt, to turning it around and over time seeing it come down, is for this country to export more and to relatively import less. We will do so if we give our producers and our businesses a fair go in the tax system.People often talk about the level playing field. My response to those people is that we should take the whole damned playing field and tilt it in our favour. Giving Australia a competitive tax system will give our people an efficient system which will help them to lower their costs. That means more production in Australia, more jobs and, over time, that is the sensible way to attack the problems of the current account deficit and foreign debt.It also means, for all businesses, a reduction in the taxes imposed on those businesses. That frees up those businesses to be more competitive. If our businesses are more prosperous, they will create more jobs. That is a clear benefit. The sum total of the changes means a boost to living standards and a boost to the government's efforts to encourage our businesses to create more jobs.One of the other really significant measures in this legislation is the change to Commonwealth-state financial relations. This has been a difficult issue, certainly in the last 50 years, and tomorrow, with the package that we are putting in place, in a parliamentary sense we will be halfway to the most significant reform in Commonwealth-state financial relations. The reason that is important is that, if we have a better structure between the Commonwealth and the states, the states are better able to have the funds for schools, roads, police, hospitals and the like.In other words, the states will be much better financed over time to provide the basic services that the ordinary community wants. I say that because a lot of people do not follow the details of the tax debate, but the reason we have walked over hot coals politically for this is that, for the average person, it is actually going to improve their living standards. It is a big lift. It is one of the things we can really do to help people, and that is why we are so determined to do it.This suspension motion is important. It is a procedural motion but it does mean that we will tomorrow secure the passage of this historic legislation. It is probably a poisoned chalice to make this comment but I do thank the Manager of Opposition Business for being at least slightly more reasonable than the member for Hotham, and I hope he does not say that on this issue we have just been amiably useless.10:08:001665McMullan, Bob, MPMr McMULLAN5I4CanberraALP00—All those members who think they can rely on the word of the Leader of the House to protect their interests should work out how much value he put on the commitment that he was not going to use his full 20 minutes. He used the first minute and the last 15 seconds to speak on the bill and then rambled around trying to fill in the time because he was embarrassed. What we have is a government that pretends to expect that we are going to be happy about the fact that this unnecessary and unreasonable set of arrangements is being put in place, simply because it could have been worse. I accept that it could have been worse. The internal arrangements within the envelope of time that has been allowed could have been much worse, but the problem is that this is the motion about the total size of the envelope and that is where the whole proposal is fundamentally flawed.To say that we should accept that because we made a few gains to give the member for Hotham better opportunities to speak—so he will have equal time with the Treasurer, which he should have—and we should be grateful for that because the rest of us are not going to get very much time at all seems to me to be most unreasonable.Let us have a look at this question of the adequacy of the time made available to speak on these bills. It is hard to calculate to the last minute because it is hard to calculate how much time votes and other procedural matters will take tomorrow. But it does seem that by the end of today we will have had 13 hours of cognate debate on the second reading, which is really what applies to most members in the House. The second reading debate, when backbench members—ordinary members of parliament—get a chance to speak, will be something like 15 or 16 hours. Without doing any special calculations to take out extra time available for leaders and others, we are going to find that the time is about 30 seconds per bill per opposition member: that is how it works out. What this means, in effect, is that for a whole lot of people—Government members interjecting—5I4McMullan, Bob, MPMr McMULLAN—We could debate it until April without losing one minute of time for the government—and you know that is true. It means that a whole lot of people in the opposition are going to get no time, because they are not going to get on the list; a whole lot of people who want to speak are not going to get a turn.DK6HOCKEYMr Hockey—They don't want to speak.5I4McMullan, Bob, MPMr McMULLAN—Yes, they do. Everybody on this side—and I thought everybody, too, on the government side, but that is obviously wrong—ran in the election saying, `This is a pretty important matter.' They said to their electors, `This is a very important matter and, given the chance, we will get up in the parliament and say so.' You would have thought from the way some of the government members carried on during the election that they thought so, too, but many of them do seem to have been remarkably shy about coming here and making their enthusiasm apparent to their electors because they think it might be drawn to their attention.Mr Hockey interjecting—5I4McMullan, Bob, MPMr McMULLAN—We will. That is one of the things we are most looking forward to—seeing how they all vote on the various amendments and motions. That will be one of the highlights of the week. It is all very well to sit safely in North Sydney, sending the troops from the marginal seats who sit along here out there to fight, and after the trouble you will be back.Let us have a look at the traditional arguments about why we ought to have the time cut off because the government desperately needs to get the bill or set of bills passed. In the past it has been said, `We are spending too much time on a minor bill. This is just an irritant; it is getting in the way.' We cannot say that about this legislation: this is the great tax adventure. Another argument is that it has to be done quickly to meet the Senate cut-off requirements. That was the main drive for the guillotine for a long time, but that is no longer appropriate. Is there an operational deadline for this matter that cannot be accommodated if we do not pass the bill before Christmas? No, it comes into effect in July 2000 and the government itself said it needs to be passed only by 30 June next year.Will passing the bill through the House before Christmas expedite the overall passage of the bill by one second? No, it will not, and everybody knows it will not. The Senate has already decided, and the government has agreed, that whatever the House does the Senate debate will not commence until 19 April. Provided the House has passed the matter by 18 April, not one second of time will be lost for the government. So every argument that this has to be passed by Christmas collapses in a heap because we all know it is going to go on a shelf, having been forced through here with so many members—independent and opposition members and, we would have thought, government members—not having a chance to speak. It is going to sit on the shelf for four months. Four months from today the Senate will still not be dealing with this bill. Four months from today it will still be sitting there on the shelf and we will be saying, `I wonder when the Senate is going to get around to it.'The other argument is that sometimes in a package of bills we do not need a debate because, as the government has asserted, the opposition is committed to opposing all the bills. But in fact that is not the case. If the government had introduced all of its tax package measures we would have supported a large number of them. In any event, we will support some of these bills.But the thing I really want to say to government backbenchers when they are concerned that their time is being cut short—even if it has to be passed today—is: check the Leader of the Opposition against the criteria. When we finish this bill at 5 o'clock, what are the odds that we will then sit around twiddling our thumbs for hours? What are the odds that from 5 o'clock we will be waiting for hours and hours for things to come back from the Senate, twiddling our thumbs, saying, `I wonder what the rush was to pass it by 5 o'clock?' In previous debates at the end of the year, every time that the Leader of the House told us that something desperately had to be passed within X hours, we finished that last day. We then had the world's longest Senate end-of-year speeches so we could fill in a lot of time. Usually, we then adjourned for a while and waited for things to come back from the Senate. I suspect it will happen again.Why have we got this? Why do we have to ram this through? It does not have to be. It will be on the shelf for four months. We will be twiddling our thumbs for hours today. It is really the `Macho Pete' show. It is bit like Bruno Grollo's tower that my colleagues here were talking about earlier. It is sort of `mine is bigger than yours'—it really is.Mr Hockey interjecting—5I4McMullan, Bob, MPMr McMULLAN—Indeed it is. It is a little bit of competition. The other downside of dealing with this so quickly is that the House is being asked to rush this matter through. There is no need, because it is not going to be dealt with by the Senate for four months, and yet the House is being asked to consider this part of the package before seeing the rest.The government did not release a new tax; it is a new tax system with a whole lot of measures, and yet several of the major bills in the package have not been introduced. We are asked, for example, to vote on the expectation that it will do wonderful things for Commonwealth-state relations—as referred to by the Leader of the House—when there is nothing about that in the bills.Mr Hockey interjecting—5I4McMullan, Bob, MPMr McMULLAN—That is because we are being asked to set it in concrete without any legislation. It will then go on the shelf and sit there for four months. We hope the government will bring in some bills to deal with that before the Senate starts its deliberations and before the Senate committee finishes, though I think they probably won't. We have the great reform of getting rid of provisional tax. If you look through the measures, where is it? It is not there. These proposals are only half the package. Why don't we wait until we see the whole package before we ram this through? Is there something in the rest of the package that would make people less disposed to support this?Within the elements of the motion and the subsequent motion that is to be moved there are some things that are better than the government's first proposals. There are a couple of things I want to say about that. We are a little concerned—but it may work its way through—about how the grouping of Nos 2 to 10 will operate in terms of second reading amendments and consideration in detail. But we will have a look at it—it might work all right. It will not quite do what we had hoped. Nevertheless, let us for the moment say that we will give that a shot. That is an internal part of it that we are worried about. We will have to accommodate our arrangements to do it in a way that will not actually facilitate the best informed debate or voting in this House. But I suspect no-one will change their vote accordingly.The most interesting question is: what is the real rationale for this rush? Why are you rushing to pass something so it can sit gathering dust for months?Mr Hockey interjecting—5I4McMullan, Bob, MPMr McMULLAN—Do you think they are in some doubt that it will pass the House of Representatives, Joe? Do you think they are? It will not give them one scintilla more certainty now than it will give them if you pass it on 18 April. If that is the best argument for rushing this through, then we know there is no argument. They will rush it through and stick it on the shelf for four months and wait. We all know that we will finish it at 5 o'clock. Despite the great promises that that will mean everybody can get on their planes and leave, we will then sit around and twiddle our thumbs for hours because we will be waiting for stuff to come back from the Senate as usual.This has not been delayed by obstruction on other matters; we have facilitated the passage of all the other bills marked for priority passage this session. They have all passed. This is, in effect, a debate about whether procedures need to be put in place for dealing with these bills because they are urgent. Most people would accept, whether they like it or oppose it—as we do, in the main—that they are important. It might be that if you are gullible enough you would even accept that it is an exciting adventure we are on here. It might be that it is the greatest tax debate since Federation. All those things have been said about it. But nothing has been said to give one iota of an argument as to why dealing with them in this timetable is urgent.I asked the government backbenchers to test the Leader of the House on this. He has knocked a lot of you out of speaking on this. You all say you think it is tremendous and that you are all very proud. You go around your electorates talking about it all the time. You go to all those people who are really looking forward to paying this tax and explain the argument to them. You wanted to come in and speak on it and you are getting knocked off—you are not getting the chance. When you see that the bill will sit around waiting for four months, and when you are sitting around waiting for a few hours tonight for the Leader of the House to actually finish these things, go up and ask him why you could not use that time speaking on the bill and why that is not a reasonable arrangement.In the new year when we spend three or four hours debating other things that you think are much less important and this bill is still sitting on the shelf and will not be considered by the Senate for four months, go and ask him why he did not give you a chance to speak on this important legislation. I know that a lot of our colleagues would like the answer to that question.I would like to mention to the Leader of the House—and I see the representative of the Government Whip is here—that I think we have an understanding, notwithstanding the terms of this motion, that those shadow ministers still to come will have leave to speak on for 15 minutes, notwithstanding the 10 minutes. There are four more. I respect that that will be honoured. I understand the whips have come to that agreement. I would appreciate that being on the record, and I thank you for that.Everybody here has strong views about this package of legislation. Most of our electors have strong views about it. A whole lot of people who wanted time to express the views of their electors are not going to get it for the most unnecessary of reasons; that is, we are going to rush to wait. It is like driving very quickly to get in a queue. We are breaking the speed limit so that at the end of the road we can park in a queue and wait for four months. This is stupid. It is incompetent planning, it is unnecessary and it is unfair. Our people are very concerned about it. A large number of them will miss their right to speak.I am more interested in why government backbenchers think it is a terrific idea that they ought to be gagged in this way when there is no need for it. Most embarrassingly, in 20 minutes the Leader of the House did not even pretend to argue that there was any need for this legislation to be passed by Christmas or that anything was going to happen differently in terms of the overall passage of this bill if it is passed before Christmas. He knows nothing is going to happen differently. It is simply a `mine is bigger than yours' approach. It does not actually advance the cause of debating these bills or their passage by one minute because they will still pass on the same timetable. That is why it is a ridiculous proposal. (Time expired) Question put: That the motion (Mr Reith's ) be agreed to.10:28:00The House divided. (Mr Deputy Speaker—Mr Jenkins)76Abbott, A. J. Anderson, J. D.Andrews, K. J. Anthony, L. J.Bailey, F. E. Baird, B. G.Barresi, P. A. Bartlett, K. J.Billson, B. F. Bishop, B. K.Bishop, J. I. Brough, M. T.Cadman, A. G. Cameron, R. A.Causley, I. R. Charles, R. E.Costello, P. H. Draper, P.Elson, K. S. Entsch, W. G.Fahey, J. J. Fischer, T. A.Forrest, J. A. *Gallus, C. A.Gambaro, T. Gash, J.Georgiou, P. Haase, B. W.Hardgrave, G. D. Hawker, D. P. M.Hockey, J. B. Hull, K. E.Jull, D. F. Katter, R. C.Kelly, D. M. Kelly, J. M.Kemp, D. A. Lawler, A. J.Lieberman, L. S. Lindsay, P. J.Lloyd, J. E.Macfarlane, I. E.May, M. A. McArthur, F. S. *McGauran, P. J. Moore, J. C.Moylan, J. E. Nairn, G. R.Nehl, G. B. Nelson, B. J.Neville, P. C. Nugent, P. E.Prosser, G. D. Pyne, C. M.Reith, P. K. Ronaldson, M. J. C.Ruddock, P. M. Scott, B. C.Secker, P. D. Slipper, P. N.Somlyay, A. M. Southcott, A. J.St Clair, S. R.Stone, S. N.Sullivan, K. J. Thompson, C. P.Thomson, A. P. Truss, W. E.Tuckey, C. W. Vaile, M. A. J.Vale, D. S. Wakelin, B. H.Washer, M. J. Williams, D. R.Wooldridge, M. R. L. Worth, P. M.64Adams, D. G. H. Albanese, A.Andren, P. J. Bevis, A. R.Brereton, L. J. Burke, A. E.Cox, D. Crean, S. F.Crosio, J. A. Danby, M.Edwards, G. J. Ellis, A. L.Emerson, C. Evans, M. J.Ferguson, L. D. T. Ferguson, M. J.Fitzgibbon, J. A. Gerick, J.Gibbons, S. W. Gillard, J. E.Griffin, A. P. Hall, J. G.Hatton, M. J. Hoare, K. J.Hollis, C. Horne, R.Irwin, J. Kernot, C.Kerr, D. J. C. Latham, M. W.Lawrence, C. M. Lee, M. J.Livermore, K. F. Macklin, J. L.Martin, S. P. McClelland, R. B.McFarlane, J. S. McLeay, L. B.McMullan, R. F. Morris, A. A.Mossfield, F. W. Murphy, J. P.O'Byrne, M. A. O'Connor, G. M.O'Keefe, N. P. Plibersek, T.Price, L. R. Quick, H. V.Ripoll, B. F. Roxon, N. L.Rudd, K. M. Sawford, R. W. *Sciacca, C. A. Sercombe, R. C. G. *Sidebottom, P. S. Smith, S. F.Snowdon, W. E. Swan, W. M.Tanner, L. J. Theophanous, A. C.Thomson, K. J. Wilkie, K.Wilton, G. S. Zahra, C. J.Howard, J. W. Beazley, K. C.* denotes tellerQuestion so resolved in the affirmative.166910:33:001669Reith, Peter, MPMr REITHWI4FlindersLPWorkplace Relations and Small Business10—I declare that the following bills are urgent bills: A New Tax System (Goods and Services Tax) Bill 1998 A New Tax System (Goods and Services Tax Imposition—Excise) Bill 1998 A New Tax System (Goods and Services Tax Imposition—Customs) Bill 1998 A New Tax System (Goods and Services Tax Imposition—General) Bill 1998 A New Tax System (Goods and Services Tax Administration) Bill 1998 A New Tax System (Goods and Services Tax Transition) Bill 1998 A New Tax System (Fringe Benefits Reporting) Bill 1998 A New Tax System (Medicare Levy Surcharge—Fringe Benefits) Bill 1998 A New Tax System (Australian Business Number) Bill 1998 A New Tax System (Australian Business Number Consequential Amendments) Bill 1998 A New Tax System (End of Sales Tax) Bill 1998 A New Tax System (Personal Income Tax Cuts) Bill 1998 A New Tax System (Compensation Measures Legislation Amendment) Bill 1998 A New Tax System (Bonuses for Older Australians) Bill 1998 A New Tax System (Income Tax Laws Amendment) Bill 1998 A New Tax System (Aged Care Compensation Measures Legislation Amendment) Bill 1998 10000DEPUTY SPEAKERMr DEPUTY SPEAKER (Mr Jenkins)—The question is that the bills be considered urgent bills.10:33:00The House divided. (Mr Deputy Speaker—Mr Jenkins)77Abbott, A. J. Anderson, J. D.Andrews, K. J. Anthony, L. J.Bailey, F. E. Baird, B. G.Barresi, P. A. Bartlett, K. J.Billson, B. F. Bishop, B. K.Bishop, J. I. Brough, M. T.Cadman, A. G. Cameron, R. A.Causley, I. R. Charles, R. E.Costello, P. H. Draper, P.Elson, K. S. Entsch, W. G.Fahey, J. J. Fischer, T. A.Forrest, J. A. *Gallus, C. A.Gambaro, T. Gash, J.Georgiou, P. Haase, B. W.Hardgrave, G. D. Hawker, D. P. M.Hockey, J. B. Hull, K. E.Jull, D. F. Katter, R. C.Kelly, D. M. Kelly, J. M.Kemp, D. A. Lawler, A. J.Lieberman, L. S. Lindsay, P. J.Lloyd, J. E.Macfarlane, I. E.May, M. A. McArthur, F. S. *McGauran, P. J. Moore, J. C.Moylan, J. E. Nairn, G. R.Nehl, G. B. Nelson, B. J.Neville, P. C. Nugent, P. E.Prosser, G. D. Pyne, C. M.Reith, P. K. Ronaldson, M. J. C.Ruddock, P. M. Schultz, A. J.Scott, B. C. Secker, P. D.Slipper, P. N. Somlyay, A. M.Southcott, A. J. St Clair, S. R.Stone, S. N. Sullivan, K. J.Thompson, C. P. Thomson, A. P.Truss, W. E. Tuckey, C. W.Vaile, M. A. J. Vale, D. S.Wakelin, B. H. Washer, M. J.Williams, D. R. Wooldridge, M. R. L.Worth, P. M.64Adams, D. G. H. Albanese, A.Andren, P. J. Bevis, A. R.Brereton, L. J. Burke, A. E.Cox, D. Crean, S. F.Crosio, J. A. Danby, M.Edwards, G. J. Ellis, A. L.Emerson, C. Evans, M. J.Ferguson, L. D. T. Ferguson, M. J.Fitzgibbon, J. A. Gerick, J.Gibbons, S. W. Gillard, J. E.Griffin, A. P. Hall, J. G.Hatton, M. J. Hoare, K. J.Hollis, C. Horne, R.Irwin, J. Kernot, C.Kerr, D. J. C. Latham, M. W.Lawrence, C. M. Lee, M. J.Livermore, K. F. Macklin, J. L.Martin, S. P. McClelland, R. B.McFarlane, J. S. McLeay, L. B.McMullan, R. F. Morris, A. A.Mossfield, F. W. Murphy, J. P.O'Byrne, M. A. O'Connor, G. M.O'Keefe, N. P. Plibersek, T.Price, L. R. Quick, H. V.Ripoll, B. F. Roxon, N. L.Rudd, K. M. Sawford, R. W. *Sciacca, C. A. Sercombe, R. C. G. *Sidebottom, P. S. Smith, S. F.Snowdon, W. E. Swan, W. M.Tanner, L. J. Theophanous, A. C.Thomson, K. J. Wilkie, K.Wilton, G. S. Zahra, C. J.Howard, J. W. Beazley, K. C.* denotes tellerQuestion so resolved in the affirmative.1670Motion (by Mr Reith) put:That the times allotted in connection with the bills be as follows:(1) A New Tax System (Goods and Services Tax) Bill 1998—For the second reading, until 10.50 a.m. on Thursday, 10 December 1998;For the remaining stages, until 11.40 a.m. on Thursday, 10 December 1998.(2) A New Tax System (Goods and Services Tax Imposition—Excise) Bill 1998;A New Tax System (Goods and Services Tax Imposition—Customs) Bill 1998;A New Tax System (Goods and Services Tax Imposition—General) Bill 1998;A New Tax System (Goods and Services Tax Administration) Bill 1998;A New Tax System (Goods and Services Tax Transition) Bill 1998;A New Tax System (Fringe Benefits Reporting) Bill 1998; A New Tax System (Medicare Levy Surcharge—Fringe Benefits) Bill 1998;A New Tax System (Australian Business Number) Bill 1998;A New Tax System (Australian Business Number Consequential Amendments) Bill 1998;For the second readings, until 12.10 p.m. on Thursday, 10 December 1998.(3) A New Tax System (Goods and Services Tax Imposition—Excise) Bill 1998For the remaining stages, until 12.35 p.m. on Thursday, 10 December 1998.(4) A New Tax System (Goods and Services Tax Imposition—Customs) Bill 1998;For the remaining stages, until 12.55 p.m. on Thursday, 10 December 1998.(5) A New Tax System (Goods and Services Tax Imposition—General) Bill 1998For the remaining stages, until 1.10 p.m. on Thursday, 10 December 1998.(6) A New Tax System (Goods and Services Tax Administration) Bill 1998;A New Tax System (Goods and Services Tax Transition) Bill 1998;A New Tax System (Fringe Benefits Reporting) Bill 1998;A New Tax System (Medicare Levy Surcharge—Fringe Benefits) Bill 1998;A New Tax System (Australian Business Number) Bill 1998;A New Tax System (Australian Business Number Consequential Amendments) Bill 1998;For the remaining stages, until 1.20 p.m. on Thursday, 10 December 1998.(7) A New Tax System (End of Sales Tax) Bill 1998For the remaining stages, until 1.50 p.m. on Thursday, 10 December 1998.(8) A New Tax System (Personal Income Tax Cuts) Bill 1998For the remaining stages, until 4.50 p.m. on Thursday, 10 December 1998.(9) A New Tax System (Compensation Measures Legislation Amendment) Bill 1998;A New Tax System (Bonuses for Older Australians) Bill 1998;A New Tax System (Income Tax Laws Amendment) Bill 1998; andA New Tax System (Aged Care Compensation Measures Legislation Amendment) Bill 1998 For the remaining stages, until 5 p.m. on Thursday, 10 December 1998.A division having been called and the bells being rung—QI4PRICEMr Price—Mr Deputy Speaker, on a point of order: it was advised that honourable members had copies of the schedule, but I do not have a copy of the schedule and nor do my colleagues.10000DEPUTY SPEAKERMr DEPUTY SPEAKER (Mr Jenkins)—In answer to the honourable member's question, I understand that the schedule is being circulated.10:36:00The House divided. (Mr Deputy Speaker—Mr Jenkins)77Abbott, A. J. Anderson, J. D.Andrews, K. J. Anthony, L. J.Bailey, F. E. Baird, B. G.Barresi, P. A. Bartlett, K. J.Billson, B. F. Bishop, B. K.Bishop, J. I. Brough, M. T.Cadman, A. G. Cameron, R. A.Causley, I. R. Charles, R. E.Costello, P. H. Draper, P.Elson, K. S. Entsch, W. G.Fahey, J. J. Fischer, T. A.Forrest, J. A. *Gallus, C. A.Gambaro, T. Gash, J.Georgiou, P. Haase, B. W.Hardgrave, G. D. Hawker, D. P. M.Hockey, J. B. Hull, K. E.Jull, D. F. Katter, R. C.Kelly, D. M. Kelly, J. M.Kemp, D. A. Lawler, A. J.Lieberman, L. S. Lindsay, P. J.Lloyd, J. E.Macfarlane, I. E.May, M. A. McArthur, F. S. *McGauran, P. J. Moore, J. C.Moylan, J. E. Nairn, G. R.Nehl, G. B. Nelson, B. J.Neville, P. C. Nugent, P. E.Prosser, G. D. Pyne, C. M.Reith, P. K. Ronaldson, M. J. C.Ruddock, P. M. Schultz, A. J.Scott, B. C. Secker, P. D.Slipper, P. N. Somlyay, A. M.Southcott, A. J. St Clair, S. R.Stone, S. N. Sullivan, K. J.Thompson, C. P. Thomson, A. P.Truss, W. E. Tuckey, C. W.Vaile, M. A. J. Vale, D. S.Wakelin, B. H. Washer, M. J.Williams, D. R. Wooldridge, M. R. L.Worth, P. M.64Adams, D. G. H. Albanese, A.Andren, P. J. Bevis, A. R.Brereton, L. J. Burke, A. E.Cox, D. Crean, S. F.Crosio, J. A. Danby, M.Edwards, G. J. Ellis, A. L.Emerson, C. Evans, M. J.Ferguson, L. D. T. Ferguson, M. J.Fitzgibbon, J. A. Gerick, J.Gibbons, S. W. Gillard, J. E.Griffin, A. P. Hall, J. G.Hatton, M. J. Hoare, K. J.Hollis, C. Horne, R.Irwin, J. Kernot, C.Kerr, D. J. C. Latham, M. W.Lawrence, C. M. Lee, M. J.Livermore, K. F. Macklin, J. L.Martin, S. P. McClelland, R. B.McFarlane, J. S. McLeay, L. B.McMullan, R. F. Morris, A. A.Mossfield, F. W. Murphy, J. P.O'Byrne, M. A. O'Connor, G. M.O'Keefe, N. P. Plibersek, T.Price, L. R. Quick, H. V.Ripoll, B. F. Roxon, N. L.Rudd, K. M. Sawford, R. W. *Sciacca, C. A. Sercombe, R. C. G. *Sidebottom, P. S. Smith, S. F.Snowdon, W. E. Swan, W. M.Tanner, L. J. Theophanous, A. C.Thomson, K. J. Wilkie, K.Wilton, G. S. Zahra, C. J.Howard, J. W. Beazley, K. C.* denotes tellerQuestion so resolved in the affirmative.Bills1672r703Billsr658Billsr667Billsr666Billsr702Billsr699Billsr698Billsr657Billsr697Billsr665Billsr701Billsr663Billsr659Billsr700Billsr664Billsr660BillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBills1672Debate resumed from 8 December, on motion by Mr Costello:That the bill be now read a second time. upon which Mr Crean moved by way of amendment:That all words after "That" be omitted with a view to substituting the following words:"the House:(1) condemns the Government for seeking to introduce a GST which is an unnecessary, unfair, job destroying tax which discriminates against low and middle income earners, the aged and families;(2) condemns the Government for putting at risk the low inflation environment delivered by Labor by proposing to introduce an inflationary GST which will put at risk the low interest rates made possible by low inflation;(3) condemns the Government for placing a higher priority on imposing a GST on Australian families that will make the tax system less equitable, rather than addressing tax avoidance loopholes, which would improve the equity of the tax system;(4) condemns the Government for the hypocrisy of claiming that hidden indirect taxes are unfair merely because they are not separately disclosed to consumers and then proposing a massive new GST which will also be hidden from consumers even though a retail tax can simply be made transparent to consumers; and(5) condemns the Government for granting the GST a higher legislative priority than all of the following related matters which have not as yet been introduced into the Parliament including:(a) those matters listed below which are contingent on the GST package which the Government is hiding from the Australian people and from the Senate Inquiry process such as: (i) the mechanism by which the rate of GST is supposed to be locked in; (ii) the amendments to the Trade Practices Act which will grant the ACCC greater power to police the changeover to the GST regime which the Government claims will result in all of the reductions in Commonwealth and state taxes being passed on to consumers; (iii) excise arrangements for petrol and diesel, involving supposedly retail price neutral shifts in petrol prices and a 25 cent reduction in diesel; (iv) the repeal of the so-called safety net excise arrangements which were implemented after the High Court ruled state business franchise fees to be unconstitutional; (v) the luxury car tax; (vi) the wine equalisation tax; (vii) repeal/Amendment to the Diesel Fuel Rebate Scheme; (viii) the First Home Buyers Scheme; (ix) the guaranteed distribution of GST Revenue to the states; and (x) the $500 million GST start-up package for small business.(b) Those related taxation/equity matters which are not contingent on the GST but which should be made available to the Australian people for their consideration including: (i) providing a Fringe Benefits Tax Exemption for remote area housing provided to employees in the mining industry; (ii) the repeal of Commonwealth Local Government Funding Legislation; (iii) changes to childcare assistance; (iv) excise arrangements for tobacco; (v) the entity taxation regime involving taxing companies, trusts, life insurance etc under one common set of arrangements; (vi) the business taxation measures involving the deferred company tax (ie full franking of all dividends) and the possible changes to the corporate rate and business concessions arrangements; (vii) the new employer withholding arrangements which will replace the PAYE, PPS and RPS systems; (viii) share buy-backs and liquidations; (ix) extending capital gains tax relief and the retirement exemption for small business; (x) limiting the existing Fringe Benefits Tax Exemption for non-profit organisations to $17,000 gross-up value for each employee; (xi) the anti-avoidance legislation addressing complex chains of trusts; (xii) the repeal of provisional tax and the introduction of the new Pay As You Go tax payment arrangements; (xiii) the changes to the timing of company tax arrangements; and (xiv) refundable imputation credits".10:38:001674Beazley, Kim, MPMr BEAZLEYPE4BrandALP00—The A New Tax System (Goods and Services Tax) Bill 1998 and cognate bills reflect one of the things which I hate most about this government—and most people in this country are having to learn to live with it as well: their cant and hypocrisy that they are a party of family values and a party for the family when every single thing they do—manifest recently in this piece of legislation—is an action against that. No single study of family breakdown or family difficulty in this country does not have at its heart the financial circumstances in which a family finds itself.Contemplate the actions of the government to this point as far as families are concerned. The first action was savage cuts to the Australian Federal Police and their vital role in drug enforcement. What happens in terms of drugs is a matter of the greatest significance for the average family these days. Late last year, the Prime Minister said that he was going to put in place a drug education program. Where is it 15 months on?The second action was savage cuts to child care—the opportunity people have to get good, safe care for their children while they are in the work force when the demand of Australian families these days is choice: choice about whether or not to be in the work force. If they choose to be in the work force, their children should not be penalised.Then there is the neglect of public hospitals in this country. The shameful Private Health Insurance Incentives Bill 1998 which is now in the Senate is associated with handing out benefits not to the average Australian family, not to the people who are looking after and rearing the children of this country, but to people who will stay in private health insurance no matter what. Note that there is not one single private children's hospital in this country. Every children's hospital in this country is in the public sector. Like every other parent in Western Australia, I take my kids to the Princess Margaret Hospital, and that hospital is being starved of funds by this government. The next point is the situation in nursing homes with the up-front fees which place a burden on families. Instead of being in a situation where they are seen as the patriarch or matriarch of the family, elderly people in this country are now portrayed as a family burden. That is what they have effectively become as a result of decisions made by this government.We now have the daddy of them all in this government's systematic assault on Australian families and Australian family values—the goods and services tax. Do not kid yourself about compensation in relation to a goods and services tax. Understand that the 30 per cent rate on 80 per cent of the people that they talk about does not compensate in either the short or longterm for the impact of a goods and services tax on the Australian family.Only one family friendly new tax proposal was offered in the course of the last election campaign, and that was ours. You can reform the tax system without a goods and services tax. You can reform the tax system by forcing people who are not paying their fair share of tax to pay their fair share—which is the tax reform that the people of Australia seek—and then you reward those who work and look after their families with a decent family tax credit. Our tax package in the last election campaign was 100 per cent family oriented.Understand about the dynamic of this tax that every piece of rhetoric that the Liberal Party put out on it has to be read for the code. When they say, `This will broaden the tax base,' or when they say, `This will be an opportunity to keep up services,' what do they mean? They mean that the goods and services tax—the rate at which it is levied, the goods on which it is levied—is going to rise and be enforced punitively in order to ensure in their minds that the drift that will occur in other elements of the taxation system is made up there.When the states come to the government and say, `We need more money for public schools and public hospitals,' the response of the government will be, `You know what to do—raise the GST one or two per cent.' Take it from 10 per cent, which is where it started in Britain, to 17½ per cent where it stands now. Take it from 10 per cent, which is where it started in most Scandinavian countries, and take it to 25 per cent, which is where it is now. Take it from 10 per cent, where it started in New Zealand, to 12½ per cent where it stands now.What happens to compensation packages when that occurs? What happens to tax cuts when that occurs? They are whittled away. That is the intention of this government. The dynamic of a goods and services tax, once it is in place, will become the focal point of any change in Australian public services from that point on. What does that mean? It means that gradually over time what already is—and the Liberal Party says it with pride—a massive shift of the tax burden from upper income Australia and business onto lower and middle income Australian families will persist and expand. That is the dynamic of this legislation. It starts with a fundamental unfairness to Australian families at its core, and drives from that fundamental unfairness to what is, in taxation terms, absolute persecution.The government can talk all it likes about changes in the tax rates. In terms of the effect on families, the changes in the tax rates will be eaten up very quickly indeed, if there is any compensation at all. We all know how hard it is for economists to agree on anything, but they are at one on this government's GST compensation package. You can take your pick. Let me go through a few of them on the issue of compensation, which is absolutely critical to the average Australian family. Peter McDonald from the ANU pointed out that the government estimated that the GST impact on a middle income family would be only 30c per child more than the impact on a couple without children on the same income. No parent in Australia will believe that a tax on almost everything children need would add only 30c a week to the budget, but that is the calculation on which the government has based its compensation package.Then you have got the Melbourne Institute of Applied Economic and Social Research. These are no friends of the Labor Party that we are dealing with here; these are just serious economic analysts. The Melbourne institute said that a family with two children in the bottom 20 per cent of income earners needs $19 a week to compensate them for the GST. The government will provide $8. You have got Professor Ann Harding, who said that the government must undertake additional research before the tax package is introduced to confirm whether the general CPI is a satisfactory basis for compensating social security recipients. These are actually friends of the GST that we are now talking about. Neil Warren estimates that the impact of the GST on a pensioner couple's cost of living, at $15 a week, is more than double the $6 allowed by the government. And Arthur Andersen—again, no Labor Party hacks in this list—estimates that the impact for a pensioner couple at $18 a week is three times the amount allowed for by this government.The compensation for pensioners is worth talking about briefly here. Of all the pieces of chicanery that impacts upon the average Australian family with this piece of legislation, this is the biggest confidence trick of all. Pick up the budget papers from last year and you will see this. Sitting in those budget papers are $2.2 billion worth of compensation or catch-up for pensioners to bring them to 25 per cent of average weekly earnings. That is a very good policy that we put in place, and a policy persisted with under this government. It is one of the few decent policies they have actually persisted with, but they have. But they have found a way around it; they always do. Pensioners would have got that 25 per cent average weekly earnings catch-up no matter what—no GST, nothing. They would have got that 25 per cent, and the government budgeted for it. But the government double-counts. The government gives them compensation, but it is the compensation they would have got anyway to take the pension to 25 per cent of AWE. If the government were serious about compensation, the starting point would have been to render that compensation neutral in relation to that 25 per cent AWE target, so it would have become 25 per cent plus. That is what the compensation would have been if there was going to be a serious effort at compensation. There is none of it here. This is a con job on the pensioners of this country and yet another demeaning of their status as the patriarchs and matriarchs of the families of this nation.The organisation of this has its implications into the business tax area. Upon whom will the burden of this fall? On BHP? On any of the large companies of this country? They have got their accountancy and financial systems in place which will do this standing on their heads. The people who will be affected by this will be the 45 per cent of small business people in this country who are micro-businesses. Every single micro-business effectively is a family business, almost by definition. They do their own accounting. It is usually the wife who does the accounting in that arrangement; let us be frank about that. She it is who has to sit up night after night doing the books. This is a tax which attacks lifestyles as far as micro-business in this country is concerned. It has a massive impact on micro-business in this country, on the organisation of their lives.What will be left of the family life of the ordinary, average Australian family who happen to be running their own business? Every year more redundancies come forward and people use those redundancy packages to set themselves up in business, because they cannot get back into the permanent work force again. Every time they now have to do that, as a result of experiencing that redundancy, they know who to thank for the total confusion in their lives, if this particular tax measure goes through. It will be the so-called small business and family friendly Liberal Party, who have lost that flag for all time as far as any rational analysis of Australian politics is concerned.Contemplate the impact that there will be on the average life of the Australian family when this goes through. Many countries have found it worth while to exclude food from the goods and services tax. The government thinks there is a 1.9 per cent price effect of this. You have not taxed fresh food and necessities in this country ever. The government is going to assume that a family budget, which is made up virtually in its entirety of fresh food and other essentials of life, is somehow going to be operated with a 1.9 per cent impact upon it. When you examine that 1.9 per cent and what it is made up of, there is an assumption in there, for example, that the family will be acquiring sometime during the course of the year a harvester or some other piece of major agricultural equipment. This will be news to the average Australian family living in Kwinana or Rockingham, that on their list of essential purchases this year which will make the GST all worth while for them is a combine harvester. Imagine rocking down the road with a combine harvester and saying, `As a result of having this combine harvester, I no longer resent the fact that I'm paying 10 per cent more on everything that is essential to my family.'The average housewife in this country who handles the family budget knows that one thing will not occur in this, and that is that that family budget will be compensated for. She knows, as every Australian family will come to know, that all of a sudden life on the margin will be even more marginal, as those bills chase each other around the fridge door for the services that come into the household, be it repairs for plumbing, be it repairs for the electric light, be it the bill for electricity. Those fridge magnets will be up there with every one of those bills sitting under them. That race that starts with the pay packet as the bills come in at the end of the month will be a race which families might have actually won under the current situation, but now they will stay permanently behind.What do they have to look forward to? As far as this system is concerned, they have this to look forward to: a very low quality of life and a government which has put pressure on their child care, on their education and on the nursing homes they have to put their aged parents into. The government is now going to put pressure on them in every single feature of their daily lives. This is a lifestyle tax—a family lifestyle tax.Not all families live hand to mouth. There are some families in middle income Australia that have that little bit extra, that like to give their kids the opportunities that arise. They may feel that they need to put them through a bit of extra private tuition for remedial education if they are not keeping up with maths. If they are lucky enough to send them to a greater public school they will be all right. But if they are in a government school or a poor Catholic school there is no chance. Those facilities will not be provided by the schools. They will pay another 10 per cent. Another 10 per cent will go on that.If they are concerned about the fitness of their kids and they want them to join Little Athletics—it will be taxed. If they are concerned about the fitness of their kids and they want to provide them with a sporting opportunity in a sports club—it will be taxed. If they want to maintain their own personal fitness so that they can look after their families effectively and they join the squash club or any other sporting club—it will be taxed. If they want to get themselves a bit of rest and recreation at the end of the year, or take the family away for a holiday around Australia to see something of the country—it will be taxed. And when they do that if they sit on an aeroplane with a foreign tourist they will be able to swap yarns about how that foreign tourist is not paying tax while they are paying tax themselves. This will be a rocking little opportunity for the average Australian family when they have a chance to do that.Perchance they will talk to their mum or dad who may be in one of those marvellous complexes available now where the nursing home, hostel and independent living facility are combined. This is a way many Australians are now choosing to spend their old age. There is a guarantee, more or less, that they can move from one to the other as the need arises. What are the people in these complexes going to find as they go to pick up their food? They find that, if they are in the independent living part but are sharing the dining room with the nursing home folk, they are somehow or other going to have a badge which says, `We are not GST-free residents' or, alternatively, `We are GST-free residents'. Talk about simplicity.But there will be, it has to be said, some degree of confusion applying in all of this for the average family, because the ultimate piece of cowardice and gutlessness as far as this government are concerned as they confront the consequences of their new tax is their decision to conceal it. They remonstrate about the wholesale sales tax, which is a tax on some things but not on the necessities of life. `Oh,' they say unctuously, `this is a hidden tax; you don't actually get to see the wholesale sales tax. And you ought to know that there are wholesale sales taxes on some things.' But what have they put in this legislation? Is the GST on the receipt? No, not a bit of it. The GST goes into every single document except the last. Every single line that business is taxed on with the GST will have on the documentation related to it the 10 per cent—except the final point. At the final point, when it comes across the table to the mums and dads of Australia, to the elderly of Australia or to the kids of Australia, there is nothing there that says what the GST is.They will go into that nursing home, hostel or independent living complex and as they go through to get their $3 meal—DK6HOCKEYMr Hockey—$3?PE4Beazley, Kim, MPMr BEAZLEY—Yes, they are quite cheap in many of these places. You ought to go through a few of them. DT4CREANMr Crean—It is $4 in North Sydney.PE4Beazley, Kim, MPMr BEAZLEY—Let us now defend the position of the good people of North Sydney. It is $4 for the good people of North Sydney. So it will cost $4 for the GST-free residents but $4.40 for those who are not. This is the situation you will see as an elderly person comes up to the table: `What are you dear?' the person behind the table will say in that dreadfully patronising way that the elderly are often dealt with. `Are you a GST person? I'm sorry, darling, it's going to be $4.40 for you if you are a GST person. It is only $4 for old Meg over here because she is in the nursing home and that is already covered. Don't worry dear. Just sign your little chit, dear, to indicate that we are not actually ripping off the till and to make absolutely certain that you have been properly charged.'This is a wretched tax, a tax we did not need, a 1960s European tax invented at a time when we thought jobs would go on forever. What a crazy notion—that every time you put a bit of effort into something and add a bit of value you ought to be taxed. This is a crazy notion: to shift the tax burden onto precisely the people in this country who are working and supporting the future of this nation—shifting the tax burden onto them and taking it off other people, many of whom have been evading their fair share to this point. It is a disgrace and it will be opposed. (Time expired)10:58:001678McArthur, Stewart, MPMr McARTHURVH4CorangamiteLP10—We have had an emotional response from the Leader of the Opposition. I remind members of the House and all Australians that the Leader of the Opposition was part of the government that supported Treasurer Keating's tax plan, which was vigorously pursued, to change the Australian taxation system and introduce a GST in 1985. The Keating tax plan was vigorously defended and explained to all Australians. It was only scuttled by Bill Kelty and the ACTU. I challenge the Leader of the Opposition to say what he will do if, by chance, they get back into government. Will they change the important tax reforms introduced by this government?In the words of Victor Hugo, there is nothing so powerful as an idea whose time has come. Tax reform is an idea whose time has come in Australia. The people of Australia voted positively and strongly for tax reform on 3 October, fully vindicating the leadership of John Howard as Prime Minister and as the advocate of tax reform for the people of Australia. The fundamental change being introduced on this occasion is that those Australians who spend money will have to pay their fair proportion of taxation. Those people who receive income will be able to make some savings with the heavy burden of taxation taken off their back. Quite simply, Australian taxpayers have the tax man on their back, stunting incentive and growth.Average taxpayers pay too much income tax. If taxpayers are at the highest marginal rate, they pay tax at 47 cents in the dollar. We only have to look at the practical example of the hardworking shearers. As the shadow minister at the table would understand, they pay 47 cents in the dollar because they work very hard. Likewise, the hardworking Australians who pay tax on their overtime fully understand the impact of marginal rates on their tax bill.Male average weekly earnings in 1997-98 were $36,958, according to ABS figures. These people pay high levels of income tax that have been increasing over recent years. In 1960-61, 11.9 per cent of the average income earner's wage went in tax. By 1997-98 this figure had increased to 23.2 per cent—that is nearly one-quarter of salary going to tax.Our tax reform measures will mean a new tax system that will address this fundamental problem and will mean that 80 per cent of taxpayers will be paying an income tax rate of no more than 30 per cent. The fundamental proposition is that there will be a flatter rate of tax for income taxpayers of Australia. It is important to look at the marginal tax rate and the changes that have taken place over the years. In 1955, the marginal tax rate was 19 times average weekly earnings, whereas in 1998 it is 1.3 times average weekly earnings, and that is a key figure in the advocacy for change to the tax system. Why did the Australian people support tax reform, whose time had now come, in 1998? Because it removes the imposition of taxes by stealth. Instead, the GST will be a source of revenue to state governments, which will have a clear understanding of how much money they will receive. They will be part of a growth tax and that should take away the angst between federal and state governments.There will be no more hidden wholesale sales taxes. The opposition supports wholesale sales taxes of 12 per cent, 22 per cent and 32 per cent on things that people use every day. These are the necessities of life, and I refute the argument that the GST is a new tax on the necessities of life. Let me remind members of the House that the GST will be at 10 per cent, not at these varying rates under the present incomprehensible tax arrangement.Tax by stealth—bracket creep—has increased revenue, particularly to the former government. As income earners moved into a higher tax bracket they paid more marginal tax. With the GST, the situation quite clearly will be that 80 per cent of taxpayers in Australia will be paying a tax rate of 30 per cent except for those very high taxpayers on incomes of $75,000 and over who will continue to pay 47 cents in the dollar, maintaining the integrity of a progressive tax system. I remind members that $75,000 per annum represents 1.7 times average weekly earnings, which ensures it is a fair distance from the bracket creep possibility.The new tax system removes the hidden charges on people's bank accounts. Do people in Australia understand that state and federal governments are taking $2.4 billion from their bank accounts by stealth—in the middle of the night—to fill government coffers? The new tax system is open and transparent. We are doing something completely radical with this set of tax reform proposals—we are telling Australians what tax they are paying and how much their tax will be. It is not hidden as it is with wholesale sales tax.The new tax system safeguards the current government services. We need to ensure funding so that we can maintain services to Australian society—age pensioners, people seeking help, and young students at schools. We need to change the indirect system, which is currently shrinking. The tax reform proposal before the House will in fact expand that indirect tax base so that it grows with the economy and helps fund these future demands by Australians for government services.Fundamentally, the proposition of the Leader of the Opposition is that the taxation rates of individuals should be increased. That is the very proposal we totally reject. It removes incentive and continues to place heavy burdens upon hardworking Australians. The only alternative is to focus on consumption of goods and services, which, every commentator would agree, is the growing sector of the economy. Every other Western country has adopted this method of taxation because it is more equitable and so that people, across the board, pay their fair share.The new tax system will be simpler and easier to administer. The current system, by any measure, is too complex. Accountants, lawyers and individual taxpayers would agree that the set of tax statute laws and regulations is too complex, too hard to comprehend and leads to litigation of a mammoth kind. The new tax system will simplify it by putting into the goods and services area a new tax of 10 per cent and removing the wholesale sales tax that the opposition support—they are going to support a wholesale sales tax regime that they know in their heart of hearts is fundamentally unsound.There is the fundamental proposition in the tax reform package that all business inputs will be refunded. I think a number of Australians who have not been close to the tax debate do not fully understand that. Exporters and businesses will benefit from the business import rebate system, so that exporters will not have these hidden taxes in their cost structure. There is also the choice of monthly or quarterly rebates—businesses will be able to get their GST rebate back as it suits them.The new tax system will give Australians incentive to work. All those shearers, waterfront workers and people in manufacturing who work overtime, who work hard, who put in a fair day's work for a fair day's pay will get a fair day's salary without such a heavy tax burden. It means that most people will pay less income tax—again, that 30 cents in the dollar for 80 per cent of Australian taxpayers.We will remove tax by stealth through bracket creep with the GST. It abolishes unfair taxes like provisional tax, and most members of this House would be aware there is considerable angst about that tax. It guarantees future revenue for human services and for state governments, for which they have been arguing since Federation. It simplifies the tax system and brings a commonsense view to it.The new tax system is fair and it is vital for Australia's tax system. There is nothing more powerful than an idea whose time has come—that is, tax reform—and the new tax system will really and truly come to be a part of Australia's progress and development. I am very confident that this House will pass it, and I live in hope that the Senate will pass the most comprehensive tax reform laws ever introduced to the Australian parliament.11:09:001679Ferguson, Martin, MPMr MARTIN FERGUSONLS4BatmanALP00—I rise to speak in support of the second reading amendment moved by the member for Hotham. In doing so, I suggest to the House that, to my way of thinking, the Howard government's GST legislation is based upon lies, inequity, discrimination and job destruction.The Howard government has conned the Australian business community with its promise of a simple, efficient and user-friendly tax system. According to the Howard government's strongest allies, the business community, the government's 600-page GST legislation is highly complicated and an administrative nightmare. In the words of tax expert Anna Carey, `The GST legislation is draconian and cumbersome.'I believe this is an extraordinary statement given that it was precisely these reasons the Howard government used to justify the introduction of a GST in the lead-up to the last election. If this bill is passed, Australians will be forced to become tax experts simply to understand the Howard government's GST legislation.The detail of the government's GST legislation has revealed not only its contempt for the business community but also, importantly, its disregard for the welfare of Australians. The Howard government has stubbornly refused to remove the GST on food, despite repeated warnings from Australia's peak welfare lobby group, the Australian Council of Social Service, that low income earners and pensioners will suffer the most from the GST.I turn to the automotive industry, which will also suffer through plummeting car sales in the lead-up to the GST because of the Howard government's steadfast refusal to change GST transitional arrangements. So much for the future of the automotive industry and jobs in a number of major states in Australia. It is also no wonder that Econtech has estimated the welfare gains from the GST to the Australian economy to be negligible—a maximum of one-fifth of one per cent of GDP. Australians living in regional Australia also face closures of their credit unions by the decision to apply the GST to the outsourcing of financial institutions. This is despite the government's rhetoric that financial services will be GST free.I go to the issue of the Olympics. The Howard government says that the Olympic Games will be GST free, when all TV rights and sponsorship contracts signed after 1 July 2000 will be taxed by 10 per cent. The government then says that charities will be GST free. The truth is that all raffles will be taxed by 10 per cent, as well as all goods sold above half their market price. The government says that funerals will be GST free, but only until 1 July 2005 and only if a contract has been entered into before 2 December. It would be interesting to see how many members of the front bench on the other side have entered into such a contract before 2 December, just to save the 10 per cent.The government says that education will be GST free, when it will tax books, uniforms, school bus services and fundraising activities by 10 per cent. Clearly, the Howard government is using its GST legislation to deliberately mislead the people of Australia. That is what it is doing. The devil is in the detail. The Howard government GST legislation is not only complex, inequitable and misleading but it is also, I contend, discriminatory.The Howard government will discriminate against couples who choose not to marry in a church by imposing a 10 per cent tax on civil celebrants. The Howard government will discriminate against first home buyers who choose to live in Sydney by paying them the same rebate as a couple buying a house in Hobart, despite huge differences in housing costs. The Howard government will discriminate against builders by forcing them to pay a GST on constructions that have not been completed by 1 July 2000. On top of this, builders will have to pay a GST on building materials that are currently tax free, and will face substantial losses if they underestimate the GST impact on their quotes in a cutthroat industry.Not only is the Howard government's GST legislation complex, inequitable, misleading and discriminatory; it is also, without any doubt, a job destroyer. The Howard government will be imposing a 10 per cent tax on spending, when spending is precisely what drives job growth in an economy. When the Howard government is only too aware of this fact, how can it credibly say that the GST will create jobs in Australia? The GST is a job destroyer, as the Leader of the Opposition said today. One need only look to overseas evidence to see that a GST does not create jobs. I know the issue of jobs is not a priority in the mind of this government when one of the major and first statements of the new Minister for Industry, Science and Resources is to virtually throw in the towel with respect to jobs in the manufacturing industry by walking away from a core promise in the lead-up to the 1996 election to create 200,000 manufacturing jobs by the year 2000.While the federal Treasurer often enjoys quoting the number of overseas countries that have a GST, he is careful to remain silent on the rate of unemployment in those countries, but I think that is very important. European Union countries with a GST such as Germany, France, Spain and Italy all have unemployment levels that average 12 per cent. In other non-European countries with a GST, such as Canada and New Zealand, unemployment averages eight per cent. So much for a GST being job friendly. The United States, on the other hand, does not have a GST but has an unemployment rate of 4.4 per cent. If the GST is the job creator the Howard government says it is, the overseas evidence is far from encouraging.The GST, without a doubt, is a job destroyer because it will tax services for the first time, despite this being the sector that drives job growth in Australia. That is the truth of the matter. The evidence that I will take the House through today clearly shows our dependence as a national economy, to a large extent, on the services sector for future jobs growth.I refer, for instance, to the fact that since 1985 the share of Australia's work force employed in the services sector had grown from 75.5 per cent or 5,056,000 jobs to 81.1 per cent or over 6,926,800 people in August 1998. This corresponds to a rate of job growth of nearly 37 per cent since 1985 compared to a 0.3 per cent growth in the manufacturing sector and a three per cent decline in the primary sector. Clearly we will have a major dependence on the services sector if we are to continue to make progress in reducing unemployment in Australia. It is also especially important when you consider that more than one-third of Australia's unemployed are now classified as long-term unemployed and have been unemployed for 12 months or more.The Economic Modelling Bureau of Australia has predicted that most of the 150,000 full-time and 50,000 part-time jobs destroyed by the GST in its first year alone will be in the services sector. That reinforces my view that we should not be imposing a new tax on the services sector when we depend on the services sector for job growth and when we need to front up to the crisis in employment in Australia today.The GST is all about job destroying, not job creating as the Howard government would have us believe. The Howard government's GST threatens not only the security of nearly seven million Australians who are already in jobs but also the 719,800 Australians who were desperately looking for jobs in October and who also understand the potential impact on their job prospects in the future.I go to the issue of employment, because not only does it go to our aggregate figures but it also impacts individually on the unemployed and their families. Take what the Howard government will tax with respect to the efforts of the unemployed to find work. Where will the 10 per cent apply with respect to employment? It will apply to employment placement fees. A 10 per cent GST will also apply to the cost of a professionally prepared resume, a suit for people seeking to buy one for a job interview, dry-cleaning and shoe repairs, the cost of getting to and from interviews, and a haircut to prepare for an interview.What we have is a new tax that will not only impact on the number of jobs in Australia but also impose additional costs on people who are doing it tough in seeking to find a job. They will have to confront additional costs in seeking to prepare themselves for a job interview, from the preparation of a resume through getting a haircut to the cost of getting to and from the interview. The new tax will represent yet another barrier to the desire of these people to find a meaningful job and, in doing so, to make a major contri bution to the future of the country and to the wellbeing of their family.I believe that the Howard government would be ensuring that the unemployed stayed unemployed by taxing any efforts to raise their skills. That is what it is about. The GST will represent a major tax on the efforts of the unemployed—the unemployed whom this government likes to point a finger at with respect to what it describes as mutual obligation, saying that they have a responsibility to get out there and to seek to find a job. I contend that the great majority of Australia's unemployed actually want to work. The issue at the moment is that there is an inadequate number of jobs available. Most of those people want to fulfil not only what they believe is their personal responsibility to find a job but also their community responsibility to find a job. To now place additional barriers in the face of those people and their families is an absolute disgrace and a failure of this government to face up to its responsibilities to the unemployed.I go also to the issue of those who are seeking work. This goes to the question of textbooks, tools and other training items, which will be subject to a 10 per cent GST. This will be on top of a 10 per cent GST on day-to-day living expenses such as rent, food, clothing, electricity, gas and water. I would like to see the member for North Sydney being unemployed and having to meet all of those charges on unemployment benefits in a situation in which job growth is inadequate to create the necessary jobs for those people with a desperate desire to get a job.According to the Howard government, just $2.54 a week is enough to compensate the unemployed for a 10 per cent GST on virtually every good and service, while a single person earning over $100,000 will receive $64 per week. That is the comparison. Friends of the coalition government on salaries of over $100,000 per week have a compensation package of $64 a week, while the unemployed will get $2.54.The Howard government is not even prepared to allocate one cent of the $30 billion revenue raised from the GST to pay for job creation programs. So much for its mutual obligation to reduce unemployment in Australia. It makes it harder for the unemployed to get a job and it will not even commit any additional resources to try to get those people back into work. Instead, the Howard government will use the $30 billion to fund tax cuts for Australia's wealthy—the friends of the coalition government, who kick the can when it comes to the election campaign. Clearly, the priority of the government's GST legislation is not to create jobs for the unemployed of Australia but to finance tax cuts for their rich mates.The second reading amendment moved by the member for Hotham is correct. This tax is an unnecessary, unfair job destroying tax which discriminates against lower and middle income earners, the aged and families. The Howard government stands condemned. As I said at the outset, the Howard government's GST legislation is based upon lies, inequity, discrimination and job destruction.11:23:001682Gambaro, Teresa, MPMs GAMBARO9K6PetrieLP10—Today we have a range of new tax bills before this House that mark the beginning of a rejuvenated taxation system for Australia. These bills are about securing a future for all Australians. The bills ensure the maintenance of a constant stream of revenue for both federal and state governments. They also deliver tax cuts to ordinary Australians and, in doing so, they will remove the burden so heavily placed on battling Australians by the current 1930s income tax system. The bills will also remove a hidden wholesale sales tax system which secretly taxes Australian families at the rates of 12 per cent, 22 per cent and 32 per cent.There has been a great deal of debate about these bills, and the debate continues today. The focus has been on a goods and services tax, naturally, and that is what the 1998 general election was fought on. But, as everyone in the chamber knows, the GST forms only a very small part of that overall package. Tax cuts and other compensatory measures also play a very crucial role in the overall reform of the taxation system.Before discussing these measures I want to say a few things about the GST bills. These bills will give Australia a mechanism to ensure that all Australians have the level of government services that they can expect, and members opposite, including the member for Batman, will know that. For example, let us look at some comments made by the Leader of the Opposition. In 1985 the member for Brand stated, at a National Press Club conference:There are very few societies which operate with a tax system so heavily dependent on income tax as we do and very few which don't have a substantial component of their tax system reliant on broadly based consumption taxes.I think the Treasurer and the government will agree, as will most of the Australian population. Also, the Treasurer has reminded the Leader of the Opposition of many societies that operate with an outdated tax system, one of those being Swaziland.The need for a more efficient taxation mechanism in this country has actually been recognised by members of the opposition even though they come into the House and complain and present their negative views about the tax system. But they reject it, and they reject it for one reason—for their own political survival.I am heartened by the refreshing honesty of my predecessor in the seat of Petrie, Mr Gary Johns. He has been refreshingly honest, and it is a pity that members opposite cannot be as honest as Mr Johns. I see the member for Paterson cringing; he does not want to hear what Mr Johns has said because he knows in his heart that it is very true. As the member for Paterson will recognise, Mr Johns was a former Keating government minister. In August of this year Mr Johns came out and supported the Howard government tax plan. Why did he do that? He supported the tax package because:. . . it's the sort of package that Labor will have to introduce, at some stage in the future. Any honest decent Government would.Why is this? Why would Labor have to introduce such a package? According to Mr Johns, they would have to because Australia needs a mature tax base. And why? In Mr Johns' words `so that the Labor side of life can look after the poor' and the disadvan taged—and that is what we are all about as well.Honesty in politics from the Labor Party is very refreshing indeed. From Mr Johns' comments then, one could reach the conclusion that Labor's opposition to the package is really opposing assistance to those in society who need help the most—those in the social security system and those who are disadvantaged—and that that is really what it is all about. Labor's position today is—and on other occasions has been—really about grandstanding.Unlike those opposite, the government has acted decisively to try to fix the crumbling tax system. All the members opposite give us is negativity. They do not think about the future or the prosperity of the country. These bills are about building a solid foundation—and that is what we are all about, as Mr Johns recognised. Despite the scaremongering of the Labor Party, Australians know that, and that is why they voted for us in the 1998 election.Since the election the government has also acted on its promise to ensure that contentious areas such as health, education and religious services will receive equitable treatment. It is to these areas that I will now turn. In my electorate of Petrie I have a very high proportion of people who are over the age of 65. Many of them are pensioners, and they are self-funded retirees. The government has made sure that the areas that concern these people are GST free and that nursing homes can provide goods and services which are free of GST.Qualifying institutions, such as those funded under Commonwealth or state legislation or budgets, or those which are privately funded institutions approved by the minister, are exempt. Home and community care services are also exempt. Many older people want to have the choice of staying in their own homes, and that is what this package is about as well. It gives people the choice and the freedom to exercise their quality of life. It ensures that the services that these particular people get in their homes—such as Meals on Wheels and personal care—are GST free. Members opposite will know that. That puts them on an even footing with residents of aged care facilities.I must applaud that. I visit many people—just recently I visited with a Meals on Wheels service—who would do anything to stay in their home for as long as they are physically capable. I think we have recognised this in providing care and services to them accordingly.Similarly, health services are very important. It is important that they remain GST free if they are clinically provided by a registered medical practitioner. Recently, we extended the scope of those medical services to include health services such as audiology and osteopathy. It may not please members opposite to know that there are other services such as non-essential cosmetic surgery which are not included in these health services. These exemptions are evidence of the government's commitment to listening to community concerns. They also play a very important part in addressing equity in the system.However, the real source of equity in the new system comes through tax cuts for wage and salary earners and also in compensatory measures for recipients of government benefits. This is part of the package that the Labor Party does not want to discuss—the additional tax cuts that will be available to people.Mr Horne interjecting—9K6Gambaro, Teresa, MPMs GAMBARO—There will also be a four per cent up-front increase for social security and veteran payments. The member for Paterson can argue all he likes about that, but he knows that these are adequate measures and that what we are doing is beneficial for families. Family assistance will increase by $140 a year for a child or $350 a year for single income families with a child under the age of five. Income tax cuts will also reduce the burden on families. I point out again to the member for Paterson that it is all about reducing the burden on families.I would like also to speak about the abolition of the hidden GST. Members opposite never want to speak about the hidden GST—the wholesale sales tax system. By their actions they seem to support the retention of the wholesale sales tax system which we have had since the 1930s. Only the Labor Party would have the audacity to claim that the government's package is unfair when they have had a system that taxes families. The member for Paterson spoke earlier about families. I remind him that at the moment families are taxed at 12, 22 and 32 per cent on everyday items.During the election I visited a number of local schools. There is a 22 per cent tax on lunch boxes and on a number of pencils and stationery items. These are things that families must provide for their children on an ongoing basis. I know that my children come to me regularly with a list of stationery and equipment requirements. Many of those attract a 22 per cent wholesale sales tax.This is a system which the member for Holt and former Deputy Leader of the Opposition says does not `need any kind of wholesale revision'. The member for Holt even admitted in July that he could not rule out increasing some wholesale sales taxes. The abolition of the wholesale sales tax regime will put families on a better footing. Previously, the member for Batman said that the new system would disadvantage people trying to get jobs. We are about creating jobs. We are about creating a system that will encourage employers to provide jobs.I will end my remarks by giving one very quick example. Recently, I visited an independent grocer who has a supermarket. He said to me that he was looking forward to the introduction of the new system because every year he has to pay a loan because of his sales tax bill of $22,000. The abolition of that tax would enable him to employ one extra person, which he dearly needs.We are about improving the current system. We are about creating jobs. We are about moving into the 21st century and providing prosperity for the people who come after us and for the generation after that. I have no hesitation in commending these bills to the House.11:35:001684Theophanous, Andrew, MPDr THEOPHANOUSQJ4CalwellALP00—The previous speaker said that the Labor Party does not want to discuss these bills. That is a bit rich coming from a govern ment that has moved a motion to guillotine these measures and which has not allowed enough time for discussion of the matters in the House of Representatives.DK6HOCKEYMr Hockey—Get on with the bill.QJ4Theophanous, Andrew, MPDr THEOPHANOUS—It is a bit rich coming from a government which has refused to subject these bills to real parliamentary scrutiny.Mr Hockey interjecting—QJ4Theophanous, Andrew, MPDr THEOPHANOUS—If you were really serious and you had respect for members of the House of Representatives, you should have referred these bills to a joint select committee of both houses of parliament. Instead, an inquiry by Senate committees was forced down your throat, which is disrespectful to the House of Representatives. In the final analysis, you had to accept the inquiry by the Senate committees, anyway. So why didn't you agree to set up a joint select committee to consider this very important, critical issue?Mr Hockey interjecting—QJ4Theophanous, Andrew, MPDr THEOPHANOUS—You did not do that at all. Once the inquiry by the Senate committees was established, the Treasurer said, `I don't care what they have to say; this is going to go through in its entirety.' Well, we've got news for you: you have got Buckley's chance of getting this nonsensical legislation through in its entirety. In fact, Joe, you have got more chance of becoming Prime Minister than you have of getting these bills through unamended.The reality is that we could have discussed these matters in the House of Representatives committee system and in the chamber. We have not had that opportunity. And now you are going to ram these bills through the House of Representatives and leave it up to the Senate committees to inquire into them. The Treasurer said, `It doesn't matter what the Senate committees discover or what they say; we're going to push them through whether you like it or not.' Well, that is not how democracy operates in this country and that is not how the parliamentary system operates. Let me tell you this: if you think there is not any problem with these bills, you do not know what you are talking about because the reality is that there are very serious social justice issues in these bills. First, there is the imposition of a GST on food.DK6HOCKEYMr Hockey—Yes.QJ4Theophanous, Andrew, MPDr THEOPHANOUS—Yes, it is a great idea, isn't it?DK6HOCKEYMr Hockey—What about the tax cuts?QJ4Theophanous, Andrew, MPDr THEOPHANOUS—Look, you have had your go. They are very keen to mention all the countries which have had a GST, but they do not mention the fact that there are very few countries that have a GST on fresh food. The fact is that by imposing a GST on fresh food, a fundamental item of life, and on clothing—another fundamental necessity—as Senator Harradine has said you are skewing the whole thing against the poor. And this bill, in the way it has been constructed in relation to the GST on food and on other such items, is an anti social justice measure. Let me tell you: you will not get a GST on food.DK6HOCKEYMr Hockey—Why not?QJ4Theophanous, Andrew, MPDr THEOPHANOUS—Because it will not pass this parliament, that is why not. It may pass this House, but it will not pass the Senate.DK6HOCKEYMr Hockey—What about the tax cuts?QJ4Theophanous, Andrew, MPDr THEOPHANOUS—You talk about the tax cuts. I will come to the tax cuts in a minute. You did not even give people the opportunity to talk about different elements of your construction. You arrogantly believe that only your model, and no other model, is possible in terms of tax reform. That has been your approach and you will go down because of that approach. There are many people in this chamber who know a lot about these matters, who have been around for many years and are able to discuss these issues, and they have not been consulted. That includes senators and members of this House. The minister talks about tax cuts. The minister ought to be ashamed about the way these tax cuts have been constructed.DK6HOCKEYMr Hockey—Why?QJ4Theophanous, Andrew, MPDr THEOPHANOUS—Why, he says. Have you looked at what the poor get in this package? DK6HOCKEYMr Hockey—They get a great deal.QJ4Theophanous, Andrew, MPDr THEOPHANOUS—They get a great deal, he says. Do the poor not need to eat? Do the poor not need to drink? Do they not need clothes, do they not need the essentials of life? Yet you have the cheek to give a whopping big tax cut to the rich—a huge tax cut to the rich—and you give a pittance to the poor. You say, `Of course, the rich need it more because they earn more.' What rubbish, what outrageous proposals. No government other than an extreme right-wing government would have put this forward. This is Thatcherism in Australia. The fact is that you are attacking the poor of this country—Government members interjecting—QJ4Theophanous, Andrew, MPDr THEOPHANOUS—They are all interrupting because they know what I am saying is true. Why didn't you give a tax cut that was fair to all people instead of skewing it so much to the upper middle classes and the wealthy? The fact is that you wanted to use this bill and the introduction of the GST as a form of redistribution of wealth in this country.DK6HOCKEYMr Hockey—That's rubbish.QJ4Theophanous, Andrew, MPDr THEOPHANOUS—This is rubbish, is it? Why don't you consult the Australian Council of Social Service about this and see what they think about it? They don't think what I am saying is rubbish. Why don't you consult the Brotherhood of St Laurence? Why don't you consult the Catholic Social Welfare Commission? Why don't you consult all the other organisations? They are all saying that the tax cuts, because of the way you have drafted them, are completely unjust and against the poor. They are a basis for redistribution of wealth. DK6HOCKEYMr Hockey—Rubbish.QJ4Theophanous, Andrew, MPDr THEOPHANOUS—Rubbish? We will see what happens to this country in a few years if you get your way. But you will not get your way because, unless you are prepared to substantially amend your package, it will not pass the Senate. The Labor Party will vote against the whole thing and the Democrats and other groups will not support a socially unjust proposal. They will support the Labor Party in insisting on this point.Mr Hockey interjecting—QJ4Theophanous, Andrew, MPDr THEOPHANOUS—I have been constantly interrupted by this minister throughout. I have not been able to get a sentence in. Why is he so sensitive? I will tell you why he is so sensitive: it is because he is an ideologue. All this is ideology. This is the New Thatcherism in Australia, the attempt to impose a regime that is totally unfair on the people of Australia. As I said at the beginning, we could have had a very sensible discussion of these issues through a proper parliamentary committee of both houses. We could have had a sensible discussion of the questions of tax reform where there was give and take. Instead of that, what have we got? We have this arrogant idea that only what is in this package is good and that any attempt to exempt food, for example, is to be rejected.DK6HOCKEYMr Hockey—We had an election on it.QJ4Theophanous, Andrew, MPDr THEOPHANOUS—I will tell you about the election. The election was very interesting, wasn't it? How many people voted for parties that were against the GST in your form? In the form that you put it forward, how many people in Australia voted for parties against it? Close to 60 per cent. What was your primary vote? DK6HOCKEYMr Hockey—Rubbish.QJ4Theophanous, Andrew, MPDr THEOPHANOUS—Rubbish, he says. It was barely above 40 per cent. The fact is the rest of the Australian people voted in their first preference for parties that were against your model: against the GST on food and against the redistribution of wealth in terms of the kinds of tax cuts that you were proposing. You should go back and restructure this package, think about it and talk to us and the other parties. That is the sort of thing you should be doing. Instead, what are you doing? You are simply being dogmatic and trying to ram this through. If you are going to be like that, we are going to vote against it here and we are going to vote against it in the Senate. We will go on the record as being opposed to this foolish strategy, which has been one of the worst thought-out forms of tax reform we have ever seen in this country.11:44:001686Neville, Paul, MPMr NEVILLEKV5HinklerNP10—I have heard today one of the greatest examples of mock indignation in my life, starting with the Leader of the Opposition, and going on with the member for Calwell who said that the minister was interrupting him. That would be a physical impossibility. Not only that; there are some very convenient gaps in the memories of the members of the opposition. To cite one of the great gaps in memory I will take you back to 1993 when you promised the Australian people tax cuts.Mr Horne interjecting—KV5Neville, Paul, MPMr NEVILLE—Wait a minute! You promised them tax cuts—I am going to make a very important point here—then you promptly went in and put the sales tax up one per cent and, 12 months later, you put it up another one per cent. The point I make is this: during that period of Labor government, wholesale sales tax rose from $9 billion to $13 billion. What about the pensioners of Australia then? What about the low income earners of Australia? You did not offer them one cent of compensation, and you come in here today, beating your breasts with mock indignation, and talking about the poor children in the children's wards of hospitals. You are a disgrace!I believe my electorate provides something of a litmus test for the attitudes of people in regional and rural Australia. At the last election, the majority of the people in Hinkler joined a select group. That group is the one which, as early as 1993, saw the need for a broad based consumption tax. That group is the one which recognised as early as 1993 the need for tax reform to create greater equity in income tax. That group of people is the same one which bucked the national trend and saw through Labor's scare campaign to elect me to this place in 1993. That group of people again saw through the scare campaign in 1998. Despite the facts that I had a horrendous redistribution, an 18 per cent One Nation vote and that my Labor opponent outspent me 2½ to one, they still would not accept your scare campaign.Those people recognised back in 1993 that regional and rural Australia has been unfairly shackled by Labor's tax system—the sinister and hidden wholesale sales tax system which is embedded in every section of trade. The wholesale sales tax was described by Paul Keating in 1985 as `irrational'. He was hijacked by the minority interest groups which Labor is still pandering to at the expense of the greater good of this community. Those people in that select group I was speaking of recognise that the full potential of the outstanding farming, milling, grazing, manufacturing and export operations in my electorate can be fully realised only if they are free of tax on inputs.Those people recognise that the solution to high unemployment levels in my electorate and many others in rural and regional Australia is to free up producers and exporters from red tape and the tax on raw materials so that they can put more of their resources back into their enterprises. By making Australia more competitive in this way, the outcome will be more jobs. The cost of producing these exports is expected to fall $4½ billion a year. I do not remember the member for Calwell or the Leader of the Opposition or anyone else who has spoken in this debate showing any real concern about where the jobs will come from. It is all this beating of the breast and rhetoric, but no solutions, no policies.The Labor Party really gets on my goat on this issue. If the ALP was really in tune with the hopes, dreams and aspirations of regional Australians, then surely it would know deep down that it is vital to reform the way we deliver our tax policy. Perhaps it is just policy envy because they came so close to doing the same thing back in 1985.Kim Beazley had a massive change of heart in 1985 when he backed Paul Keating's proposal to get rid of the wholesale sales tax and replace it with a GST. Remember the flowery statements? It was not only Kim Beazley and Paul Keating; it was also the member for Holt, the former foreign minister; and Wayne Goss, who was then Leader of the Opposition in Queensland. In 1985 and 1986, every Labor leader of note in this country said that the answer to our problems was to remove the wholesale sales tax and replace it with a consumption tax. You have not had the guts or the courage to do it—that is the problem. If he and others opposite had stuck to that vision then perhaps we would not have had the recession we had to have.The people of Australia realised at the last election that the only way for the government to deliver a better policy for Australia was to switch the mix of taxes. The Howard-Fischer government's visionary plan gives Australia a fairer tax system that can deliver growth, exports and jobs into the next century. We are going to have a new system which picks up those who avoid tax now but at the same time slashes red tape.Each Australian company will be given a business number, and it is only with the business number that they can be part of the system. At the moment, you could have one number for your company, another for your workers' compensation, another for your tax file, and so on. We will have a one-number system which will allow the Taxation Commissioner to police both the GST and company taxes. This will give us the opportunity to pick up the black economy. It does not take Sherlock Holmes to tell you that, if you pick up on the black economy, you can save up to $3 billion a year. That could go into the children's hospitals that the Leader of the Opposition so passionately talks about.One of the key components of this package is the reduction of income tax to lower and middle income Australians. The threshold will be lifted to $6,000 and people earning under $20,000 will be taxed at 17 per cent instead of the Labor Party's previous 20 per cent. Then all earnings from $20,000 to $50,000 will be taxed at 30 per cent. That means—we have heard it before, but it bears repeating—that 81 per cent of Australians will be paying 30 cents or less in the dollar.No matter how twisted the Labor logic is, health, education, child-care services, hospitals and nursing homes, local government rates, and water and sewerage charges will all be GST free. No matter how Labor tries to muddy the water, the rate can be locked in at 10 per cent. That can be done because GST is a growth tax that reflects population growth, which is where demand for government services comes from. That is, after all, why we collect tax—to pay for services demanded and rightly expected by the people who pay those taxes.The Labor Party knows that special powers to be given to the Australian Competition and Consumer Commission will ensure that price reductions are passed on. The one thing that Labor stressed in 1985 was equity. As I said, 81 per cent of the population will be paying 30 cents or less in the dollar in income tax. This is where the key comes in. That means that the bottom 20 per cent of taxpayers will pay just two per cent of the total income tax burden, compared with 2.3 per cent now—do you notice that the opposition is very quiet on that point?—that is, over $13 billion a year in tax cuts for battlers.Mr Sidebottom interjecting—KV5Neville, Paul, MPMr NEVILLE—It was your former core constituency who must realise their interests are now being better looked after by the coalition. As I said, the tax free threshold will be increased from $5,400 to $6,000. An extra $140 a year will be provided for each dependent child and an extra $350 a year will be provided for single income families with one child under five. I do not remember any of those things in the Labor packages. In addition, there are incentives for families to earn more by allowing them to keep more of their income and benefits.Child-care assistance will be increased by up to $7.50 per week. Pensions and allowances will increase by four per cent. At every stage in this package, lower and middle income Australians have been looked at and cared for in a way that has not occurred in the last 13 years. Not only that, but many Australians from all income categories—including Labor voters—want income tax deductibility for their health insurance payments. The proposed 30 per cent rebate on private health insurance is exactly what that equates to and it will apply to 81 per cent of Australians. I commend the various bills and hope that they will lead to a far better quality of life for most Australians and in particular for low and middle income Australians.11:57:001688Sidebottom, Peter, MPMr SIDEBOTTOM849BraddonALP00—As a boy growing up in Tasmania, one of the basic principles I learnt from my parents was that everybody deserves a fair go. It is a basic characteristic of our society and one of our great strengths as a nation. However, the Liberal Party under John Howard is attempting to erode this value with the introduction of a goods and services tax. Introducing this tax will further divide Australian society into the haves and have nots. Once again we see the Liberals looking after their own—the big end of town. Big business and the wealthy will be the only winners out of a GST and I can assure you that there are not too many who fit that category in my electorate of Braddon.The people of Tasmania totally rejected a goods and services tax at the last federal election. The member for Hinkler talked about a litmus test. In my electorate of Braddon there was a 10 per cent swing against the sitting Liberal member, who extolled the virtues of a goods and services tax but was not prepared to debate it in public. Why? Because it was of no real benefit to the people of Braddon, and he knew it.Tasmanians have had enough of being treated like second-class citizens by this government. We are not going to roll over and have our standard of living drop further with the introduction of a grossly unfair tax that targets those who are already battling. Recent newspaper reports regarding the amount of personal income tax that a prominent Australian pays—you well know who—or, more accurately, doesn't pay, is an indication of where the real problem lies.My electorate is already socially and economically depressed, with more than a quarter of its 80,000 population receiving income support of one form or another. It is ranked 17th lowest in medium weekly income out of 148 electorates Australia wide. The region has chronic unemployment running at 14 per cent and youth unemployment of more than 30 per cent. Despite the imperfections of the present income tax system, at least it gives substantial recognition to the principle that the amount of tax paid should have regard to capacity to pay. A goods and services tax or value added tax violates this basic principle. Any consumption tax ignores the vital principle of capacity to pay.Millionaires and people whose income is below the poverty line will pay the same rate of GST. This is unfair because it disproportionately hurts low and middle income households, especially those with children. Effectively, the rate is much higher for low income people because they will pay the GST on 100 per cent of their income. These people will spend a higher proportion of their income on items and services that are currently untaxed.These items and services are not luxuries. They are not discretionary expenditures that families may choose to discontinue if a new tax is put on the items. They are the necessities of life, the basic services that people need for a decent standard of living. Many of them will be paying GST on more than 100 per cent of their income as they have to borrow or incur debts just to make ends meet. Well-off people spend only a half or less of their income on essentials, so a much smaller proportion of their income will go on taxes. A GST is therefore, by definition, regressive.Studies have concluded that food takes up 24.6 per cent of the lowest income families' budgets and only 12.5 per cent of the best-off families' spending. Fuel and power account for 5.5 per cent of the expenditure of the bottom 20 per cent of the lowest income families and only 1.6 per cent for the top 20 per cent of high income families.Mr Hockey interjecting—849Sidebottom, Peter, MPMr SIDEBOTTOM—No, you only know what happens at the top end of town, not the bottom. More affluent people will benefit from a GST because, while the cost of bread, milk and meat will increase, the price of expensive motor vehicles, jewellery and other items will drop because the GST will probably be considerably less than the current wholesale sales tax on these items. But many people in the lower income bracket have little or no scope to reduce expenditure on essentials such as food, clothing, heating, educational books, transport and funeral expenses.And in regard to the elderly, my electorate has one of the most ageing populations in Australia, and a GST will be hard on them. The frail and the elderly have no option but to engage help around the home, so a GST will increase their budgets and they will be further disadvantaged.The Howard government says pensions and other allowances will rise by four per cent in the year 2000, so we need to deduct the impact of the GST from the four per cent increase. The impact of the GST on prices in its first year will be over two per cent, so the government is really giving an increase of only two per cent in the value of pensions. Pensioners are already due for increases to keep in line with wages and inflation, so they are due for substantial increases without a GST. All the government has done is to take these due increases and rebadge them as GST compensation.Braddon's small business sector will also suffer under a goods and services tax. The business sector in the north-west is characterised by a large number of very small firms. It is the major employer in the region, particularly of young people, and a GST will stifle the prospects of further growth in the area. A GST will be expensive and a burden for small business to implement and administer. The President of the National Tax and Accountants Association said earlier this year:Small businesses will have to spend almost $7,000 each in set-up costs to comply with any goods and services tax.The figures do not include an estimated $5,000 extra to buy computer systems, which many businesses do not have, in order to administer the new tax. Mr Regan also said that the new tax would more than double the cost of government red tape and cause many businesses to go bankrupt. The average small business in Braddon will have to spend at least 228 hours in the first year setting up the required accounting and taxation records.A further reason for the rejection of the GST or any broadly based consumption tax is that it will accentuate the unfair position of small businesses compared with large businesses. Instead of confronting the severe additional costs that will be faced by small businesses, the costs for large businesses will be relatively small. For some larger businesses, especially retail chains, it is likely that the GST will result in a net benefit rather than a cost, thereby extending their competitive advantage over smaller, local, independent businesses.The current wholesale sales tax is presently collected and passed on by some 75,000 businesses around the country. With a GST, nearly one million businesses, the majority of them small, will become unpaid tax collectors. This is an unnecessary and costly burden imposed on a struggling sector of the north-west economy. Small business people in Braddon overwhelmingly rejected a GST in 1993 and again in 1998.The cost differential between living in Tasmania and the mainland will be further exacerbated by the goods and services tax, and no amount of uniform compensation will make up the difference. Because goods and services will be taxed, Tasmanians will be worse off by half.Local government in my electorate is rightly uneasy about this government's tax reform proposals. It is little wonder, because local government received no meaningful consultation in the tax reform process to begin with. Likewise, concessions on gaining GST-free status for councils had to be wrenched out of this government, thereby preserving a major component of the tax base of local government. However, the GST status of many of the functions of local government remains unclear and ambiguous. Local government in my electorate strongly opposes the passing of responsibility for its financial assistance to the states and, if the GST is to be imposed, the compensation package for transition to the new tax system, already promised to small business and charities, should extend to local government.To suggest that there will be no rise in the rate of the GST in the future is unbelievable. This government is happy to claim global examples of countries with a GST, so let us continue the exercise. Twenty-one of 23 countries in the OECD have increased the general rate of their GST. Why will Australia be any different? Let us look at GST rates which began at 10 per cent. The UK is now 17.5 per cent; Denmark is 25 per cent; and New Zealand 12.5 per cent. The GST is a Commonwealth government tax and can be changed by any Commonwealth government in the future. This will have to happen as the inevitable inflationary effect, well beyond the predicted 1.9 per cent, sets in.I have listened to members opposite bleat about how wonderful and necessary their GST is for the Australian people—as if the nation is waiting with bated breath for the coming of the new-age tax. For goodness sake, we are talking about imposing a tax on people, not giving them the kiss of life.Is Australia's economy worse off than the government tells us? Do not tell me that our so-called `ramshackle, 1930s tax system' has produced low inflation, a surplus budget, low interest rates, and progressively increasing taxation returns. Well, let us get rid of this system in case it continues. What nonsense. It is almost as nonsensical as saying the GST will eliminate the black economy. In fact, it does the opposite. That is chronicled in every economy that has a GST, and it will be no different in Australia. No, the GST is not progressive. It is unfair, unnecessary and inflationary. It is a tax on everything and was clearly rejected by the voters of Braddon and by the voters of Tasmania.12:07:001691Barresi, Phil, MPMr BARRESIZJ6DeakinLP10—I rise to speak on the A New Tax System (Goods and Services Tax) Bill 1998 and cognate bills. The 1998 parliamentary year draws to a close, and members on this side of the House can feel a good deal of satisfaction with another year of strong economic performance. With inflation at record low levels, interest rates that we have not seen since the 1960s, the job outlook the brightest for a decade, low unemployment in Deakin, and growth rates of five per cent defying expectations, Australia has the strongest economy in the region. While our neighbours have gone into a tail spin, our economy has bucked the regional trend. Not only have we appeared to weather the storm but we are continuing to grow.Terry McCrann has little doubt where the credit lies for that. The other day, he wrote in the Murdoch press that the Treasurer, and the Reserve Bank chief, Ian Macfarlane, can claim much of the credit. He went on to say:. . . thinking Australians should breathe a big sigh of relief that Kim Beazley and his assorted policy vandals did not sneak into government at the election.Future generations will look back on 1996 and be thankful that Australians kissed Labor and its policies goodbye. It is frightening to think where our economy would be now if the people had not shown such wisdom.Again, future generations will be grateful that, in 1998, the people re-elected a government that is prepared to take the bull by the horns and reform a tax system that handicapped our past performance and threatened our future. It is rare that an Australian government—or, for that matter, any government—has gone to the people seeking such sweeping reform as this. It is just as rare for a government to be returned by the people after campaigning for extensive change.Far from there being insufficient time for this debate, the Howard government showed all its cards early. The Australian people liked what they saw. The efforts of the previous government were characterised by no support, no election, and no consultation with the electorate. We did not see that in the 1998 election campaign with what the government took to the people.This plan originated in an open manner with submissions being taken by the Prime Minister's Tax Consultative Task Force—of which I was proud to be a member—which contrasts greatly with the post-1993 Keating government's performance. We are back here not to dream a political fantasy but to deliver a new taxation system: a system that is fair and provides a satisfactory base for our future needs. Our current system has outlived its usefulness; it is unfair and inadequate. The system itself is a tax on Australia. The faster we want to go as a nation, the more it slows us down.Even some of the more rational Labor members admit this in private—but not here. It is only when they retire or resign from office, or lose at the polls or, in some cases, get banished to the back bench, that they are finally free to express their true feelings—as evidenced by the former member for Petrie's recent comments about Labor's lacklustre policy performance. Most of the current Labor crowd think there are votes in their opposition to our program. However, in the electorate, people do not see opposition; they see Labor's lazy and hypocritical attitude.The member for Hotham is, predictably, leading the charge against meaningful tax reform. He is leading the charge against anything meaningful. On Monday, he came in here and, with a straight and earnest face, mustering all his thespian abilities, proclaimed that our tax system is fine and that it is all okay. His view would appear to conflict with that of 82 per cent of the Australian public. Opinion leaders, media commentators, business and community groups have all agreed that the member for Hotham's perfect tax system is `broke' and needs to be fixed.The member for Hotham is a man who never met a tax he did not like. But he is now pleading the case against a GST—a tax which will reduce taxes and, in many cases, reduce the prices on items we purchase. He is still strong on the idea that a salacious government would be able to raise the level of a GST. We know that only a greedy Labor administration such as the Keating-Beazley crowd would countenance such a thing, but even they would not be able to pull this off.No other nation has had the safeguards that Australia will have against raising the level of indirect tax. Once it is set, even the `tax and spenders'—the political descendants of Bannon and Cain—will not be able to hike up the rate. With electoral cycles as they are, with an election somewhere in Australia almost every year, which state premier would dare to take a chance by voting to increase the rate and then face the people in an election that year? It is a safeguard which has been brilliantly thought out and which will succeed. It is ludicrous to compare us with other nations. No other country has had a tax system exactly the same as ours. With our current mess—the mess that Labor wants to prolong—it is no wonder.This almost maniacal fixation that Labor has on the GST ignores the savagery of our income tax set-up. In 1955, personal income tax accounted for 38 per cent of government revenue. Today, it accounts for 52 per cent. Australian workers pay far too much income tax. When the nation begins its new tax year on 1 July, we will all be working hard for the tax man. A single income person with a taxable income of $35,000 pays $8,477 in income tax, including the Medicare levy. That means that he or she will work until AFL grand final day to satisfy their responsibilities to general revenue.Someone on $41,000 will toil until they do 162 laps of the Mount Panorama circuit on Bathurst Sunday to do the same. It gets worse. Those with a taxable income of $44,000 will discharge their duty to the public purse about the time that Might and Power wins next year's Cox Plate. So it goes on. It will be Derby Day before someone on $55,000 pockets a cent for themselves—near enough to four months, or one-third of a year, as indentured slaves to the Australian Taxation Office.Under the coalition plan, the taxpayer on $35,000 will have earned his income tax for the year by the end of August. The taxpayer on $50,000 will be done by the end of September. Both will pocket the equivalent of an extra three weeks pay a year. The 10 per cent GST will replace hidden, indirect taxes on a whole host of products. We all pay these taxes, and we pay them at seven different rates, from nought to 44 per cent.Labor gave only grudging recognition to this problem in the last parliament. Its own tax plan offered only to tax caviar and to change the rate on orange juice. Its so-called tax plan was as transparent as it was pathetic. The people of Deakin realised that it was cobbled together in a hurry, a bit like the member for Jagajaga's speech last night. Like her speech, the plan made no sense, was chock-full of untruths and addressed none of the issues. In contrast, the member for Herbert illustrated very well the anomalies and the stupidity of Labor's wholesale sales tax system. Under the current farcical system, we have companies arguing with the Taxation Office over whether a product is a biscuit or a chocolate bar, because each is taxed at a different rate. We have the same product taxed at a different rate, depending on whether you call it a credenza or a sideboard. We all know that these wholesale sales taxes penalise exports, which have been a real boon for growth and jobs in this country. We all know that FID, BAD and stamp duties are a burden for business and individual alike, yet Labor defends these taxes. Labor wants these taxes to be prolonged and to continue being a burden to our businesses.The Leader of the Opposition asked us during an MPI debate last week to imagine the crisis we would be in if Labor had not encouraged the broadening of our export base. He invited us to close our eyes and follow his yellow brick road of fantasy—the `would be if could be' achievements of a fanciful government. The problem is, the people have had their eyes open since 1996. They awoke after a 13-year nightmare. In contrast, the economic performance of this government is not a dream but a reality which all Australians can rightfully be proud of playing a part in. You may say he's a dreamer, Mr Deputy Speaker, but he's not the only one. I wonder if he can imagine the extra business our exporters would have enjoyed for a dozen years if Labor had possessed the ticker to reform the system in 1985, when they believed in change and when they were answerable to the people. Back then, as a government minister, the member for Brand supported a broad based indirect tax. Now he is clearly putting the interests of the Australian people a distant second to the survival of his shaky leadership.The Labor Party's only crack at reform was a belated response to the coalition's Fightback plan. They promised not to put up taxes. As soon as they were elected they did—to the tune of $10 billion. They put up the Medicare levy by 1.5 per cent, increased company tax from 33 per cent to 36 per cent, and hiked taxes on cars, petrol, and everything from buckets to horse rugs. In return, they promised income tax cuts, l-a-w law style. They did not deliver. Once again, it was the battlers that got hurt. Then again, Labor has consistently hurt those it claims to represent. Those on lower incomes, on fixed incomes or on government benefits will all gain from this package. A very important mechanism in this plan is the measure to increase benefits by four per cent up-front—and then ensure that they stay at a level of 1.5 per cent above the CPI. Yet we have heard nothing from the other side on this or the other advantages of our plan. Rather, we have been subjected this week to the same tripe that Labor foisted on the people during the campaign.It is almost comical to hear these Labor ideologues come in here and say that the people will reject these reforms at the next election. Some of them have learnt in just six weeks what it took Paul Keating more than a decade to learn—that is, to totally ignore the message and mood of the electorate. The voices of the people are loud and clear: `We are sick of the arguments—just do it. Get it done, give us a break, and give Australia a future. That's what we elected you to do.' Many in the electorate may now be unaware that we cannot achieve this without the votes of some Labor, Democrat or Independent senators in the other place. I can guarantee that that situation will have changed well before the next election. I urge all members to support these bills.12:19:001693Rudd, Kevin, MPMr RUDD83TGriffithALP00—The core argument advanced by the government in support of the bills before the house, A New Tax System (Goods and Services Tax) Bill 1998 and related bills, is that a 10 per cent consumption tax equals national economic reform. The component arguments put by the government in support of these bills are equally simple. The first is that if this package of taxation measures is introduced there will be a demonstrable additional increase in economic and employment growth. The second is that any negative distributional impact flowing from the package will be either marginal or irrelevant or, to the extent that it exists, will be readily compensable, and that this compensation can be found elsewhere in the taxation package. The third argument advanced by the government in this proposition is that the package, if introduced, equals a fundamental reform of a rational nature to the structure of Commonwealth-state financial relations.The problem is that, in the debate which has taken place on these bills and in the question times to which we have been subjected in this parliament over the last four weeks, we have not heard a single shred of evidence to support any of the propositions which have been advanced. Instead, what we have had is what I can only describe as the proclamation of dogma. Dogma, as we know, is not susceptible to rational argument. Dogma contains self-revealed truth and does not yield to any form of logical disputation.I have sat in this parliament for only four weeks now. I think one of the most remarkable impressions it leaves on a new member is that when we witness day after day the performances, the preenings and, dare I say it, the posturings of the Treasurer of the Commonwealth of Australia, we are not presented with any systematic or logical underpinning of the propositions being advanced. What we have had instead is a daily retinue of theatre—and poor theatre at that. We have had a combination of the amateur dramatic society and the local thespians all rolled into one. It is poor theatre.What we have had in terms of the performances of the Treasurer of the Commonwealth is the ultimate triumph of form over substance. What we have not had is a simple, systematic exposition of the underlying logic behind these bills. If the government wishes to engage in the most fundamental change of the economic and taxation structure of the country since the war, and in so doing engage in a radical social experiment, then surely the parliament demands such an exposition. If this is supposed to be the government's crowning policy achievement, it would be a rare treat for all of us if the Treasurer were to descend from on high on just one occasion to explain to this parliament why a 10 per cent consumption tax equals national economic reform, QED.Is it national economic reform to impose a 10 per cent consumption tax without any guarantee of its impact on economic growth? Is it economic reform to introduce a consumption tax without any guarantee of its impact on employment? Is it reform to bring in such a radical set of measures without any guarantee of their impact on inflation or income inequality, or for the proper compensation of the poor or of the compliance costs for small business? Is it economic reform writ large to bring in a package of measures where we blindly assume that the pass-through impact of those tax cuts to producers, wholesalers and retailers will also be passed through to consumers at the checkout? Is it economic reform to blindly assume that the black economy will fade away? Is it economic reform to assume that this somehow represents some rational reform to Commonwealth-state financial relations when the minister at the table knows as well as anyone else in this chamber that this radically regresses the state of vertical fiscal imbalance rather than the reverse?The uncomfortable truth is that none of these things are reforms. They are regression writ large. Why is it that the government, represented in this chamber by the minister at the table, are so confident about their growth projections? Why is it that, if they are so confident about their growth projections, they are silent about a precise number that will be generated as a consequence of the implementation of this set of measures?We have had modelling exercises done by Econotech and they have projected a particular number. We have had advice from the Economic Modelling Bureau Australia—not in terms of a growth projection, but they have warned that the inflationary impact of this package could be three times that contained in the official documentation of the government if we assume less than 100 per cent pass through. We have documentation and modelling from the Melbourne Institute, which projects a cumulative growth figure of 1.7 per cent. If you take that over time it would add a princely sum of an additional annual growth figure of not even 0.2 per cent—and that is if you make the most benign assumptions about the growth environment of the period. Other models are also being developed.But I ask the government, through the minister at the table: where is the government's proud proclamation of what additional quantum of growth will be added to this economy as a result of the introduction of this particular set of taxation measures? The answer to that is that they refuse to provide such a number because they do not wish that measure to be held up against it in the future.Australians are a patriotic lot. They are prepared to cop a bit of pain. They will do so if they believe that the introduction of radical measures such as these are worth it in terms of the national economic and social gain. But this government, in confronting the people of Australia, refuse to provide an undertaking which says, `If you introduce this set of measures the economy will grow by X per cent.' And they refuse to do that because they have no confidence at all that it will result in any additional growth of any consequence.Look at the international experience. As the Deputy Leader of the Opposition has said in this chamber, look at our own region, the United States, the People's Republic of China and this country. These are all countries which have registered significant positive periods of economic growth in recent years but none of which possess a consumption tax. Look at Japan and the diabolical state of the domestic Japanese economy. There are calls now to re-inject life into the Japanese economy. The measure most advanced in Tokyo today is the abolition of Japan's five per cent consumption tax. The bottom line is that neither the minister at the table nor the Treasurer, when he deigns to provide us with his presence in this chamber, have advanced one single piece of proof as to why the macro-economy of this nation will benefit and growth and employment will increase as a consequence of the introduction of these measures.We are asked to accept that it is national economic reform to embark upon this set of measures and to believe at the same time that tax avoidance and tax minimisation in this country will somehow disappear down the drain. We have no answer from the government at all regarding the international experience, particularly that in Europe, and why the introduction of this tax has led to a monumental increase in tax avoidance. We have 40 per cent tax avoidance on this particular taxation measure in Italy. We have total tax avoidance across continental Europe of an order of magnitude in dollar terms equal to that of the gross domestic product of the United Kingdom. What will happen with tax avoidance when you move from 70,000 taxation points with the wholesale sales tax to 1.2 million taxation points with the goods and services tax?We are also asked to believe that there will be a full pass through of the economic benefit of these taxation measures to the consumer. The government's response is: `Trust us, believe in competition, believe in Adam Smith's invisible hand, Bob's your uncle, it will be all okay in the morning. And if the magic hand of competition does not work we will bring in the competition police.' Poor old Allan Fels out there in Northbourne Avenue, Dickson, is going to become the competition policeman of Australia—monitoring the tens of millions of economic transactions which occur in this country every day. It is a palpable logical nonsense to assume that anyone, any instrument of the state or any element of bureaucracy could possibly manage such an undertaking.Finally, there is the important question of Commonwealth-state relations. The government has advanced a set of proposals to the states. In the first instance, its major deficiency has been to radically underestimate the transition costs which will flow to the states as a consequence of this package. Originally the degree of underestimation was $3.2 billion. After some fiddling we now have that figure down to $1.6 billion. But the states, in terms of their budget sector, are collectively worse off as a consequence of this set of measures.Secondly, there is the question of vertical fiscal imbalance. All states historically have said that VFI is the cornerstone of meaningful and rational Commonwealth-state financial reform. At present the states are collectively 58 per cent self-reliant in terms of their revenue as measured against their expenditure responsibilities. After this package it will reduce to 42 per cent. If you regard that as reform then the government's definition of the term is one that is radically alien to that which is contained in the Concise Oxford Dictionary.But the crowning glory of Commonwealth-state relations is the principles document agreed to by the Prime Minister and some of the Premiers. On the question of specific purpose payments: $15 billion of $74 billion of total state outlays come from specific purpose payments. What guarantee have we obtained in this document, which was signed off by the Prime Minister and some of the premiers, that the Commonwealth will continue to provide SPPs to the states and territories and `has no intention' of cutting aggregate SPPs as part of this reform because to do so would `defeat the objective of the states and territories being better off under these new arrangements'?You can drive a Mack truck through that language. Any state bureaucrat or Treasury official with any sense of professional self-respect should not have worn the language `has no intention of cutting SPPs'. They should go back to state bureaucratic training school. The bottom line is that that undertaking to the states, in terms of the future integrity of SPPs, is not worth the paper that it is written on.In conclusion, Mr Deputy Speaker, this set of taxation reforms contains within it a series of propositions which fail fundamental tests of logic. It fails the test of logic in terms of economic growth, employment growth, social equity and Commonwealth-state financial reform. Forget the politics, Minister, as you depart the chamber. It fails the test of policy integrity. Politics is, in fact, an ancillary consideration to the fundamental policy deficiency of this overall document. This is not a package of taxation reform or national economic reform; this is a package of national economic and social regression.12:30:001696Nelson, Dr Brendan, MPDr NELSONRW5BradfieldLP10—In his introductory remarks this morning in his contribution to the debate on these tax reform bills, the Leader of the Opposition—the member for Brand—displayed both his ignorance of and, to some extent, his arrogance towards, the private health care sector and he also misled the House. He said that there was not `a single private children's hospital in Australia'.He ought to be informed that the Allowah Children's Hospital was established at Dundas almost two decades ago. It provides acute, semi-acute and respite care for developmentally disabled children from birth to 13 years of age. It also caters for the special needs of children who have a disease from which they will not recover, and for those with head injuries. In fact, in 1984, when he was the health minister, Dr Neal Blewett sought to change the 3b certification rule to ensure that these children—whom I would suggest to you are the most vulnerable—were required to be reimbursed at the long stay rate from day one of admission.The Leader of the Opposition should visit Allowah private hospital at Dundas. It is, as I said, a 38-bed private hospital specifically for children who have significant needs.8K6FITZGIBBONMr Fitzgibbon—I raise a point of order, Mr Deputy Speaker. Reluctant as I am to interrupt, I think you will agree that on a matter for relevance, the member for Bradfield is right off the track.3E4SULLIVANMrs Sullivan—On the point of order, Mr Deputy Speaker; I was listening with some interest to what the member for Bradfield was saying. I believe he is developing a point and should be allowed to make it, and then you can judge whether it is relevant.10000DEPUTY SPEAKERMr DEPUTY SPEAKER (Hon. D.H. Adams)—The matter before the chair is tax bills. These are pretty wide ranging and I think the honourable member for Bradfield is answering argument that has been put before the House on the same bills.RW5Nelson, Dr Brendan, MPDr NELSON—Thank you Mr Deputy Speaker. In fact, when the Australian Council on Health Care Standards certified Allowah private hospital—for children, I might add—it described this hospital as `a centre of excellence . . . providing such a unique and necessary health service at a level which could be used for quality bench marking throughout Australia.'Apart from rectifying his ignorance in relation to the private hospital sector, one of the reasons why the Leader of the Opposition and his colleagues should visit this hospital is to have a look at the sort of children who are there and the sacrifices made by their families to maintain their private health care insurance which gives them access to the hospital. Then come back here and tell us that you do not want to support a 30 per cent private health insurance rebate for people who take out private hospital insurance.Turning specifically to tax—of which private health insurance is a significant part, including a 30 per cent private health insurance rebate—I would like to quote the Prime Minister. He said:. . . you can't have a continuation of a tax system which is haemorrhaging, imposing burdens on those least able to bear them—and which is `economically inefficient.' He went on to say:The second thing is that if the broad-based consumption tax is brought in, those increasing numbers of people in the community who by the use of clever lawyers and accountants have avoided the payment of any tax on their income and also in the absence of a consumption tax, aren't paying any tax on the spending of that income. They will be caught up there by the twelve and a half per cent consumption tax, they will be paying tax . . . That was the Prime Minister—but it was the Prime Minister Mr Bob Hawke. The first quote was on 2 June 1985 on the Sunday program, the second was on the Willesee program two days later on 4 June 1985. On 7 June 1985, Mr Hawke, as the then Labor Prime Minister of Australia, said to the Melbourne Age taxation symposium:We must all recognise that it would be all too easy in this debate to inflame fears and prejudice. And we should realise that some people will be trying to do just this . . . But the question is whether we have, as a nation, the maturity to pursue a dispassionate debate in order to achieve such overdue change.Two days later, again on the Sunday program, Prime Minister Bob Hawke said this:Most of the things in the thirty-two and a half per cent schedule—that is the whole sales tax schedule—are today everyday items, such as TV sets, video tape recorders, biros, these sorts of things. And there are very few which are luxuries . . . I mean, I just don't think we ought to skew the whole tax system around to worry about a couple of items like that.Finally, on 13 June 1985, in the context of the debate about whether there should be exemptions like food, Labor Prime Minister Bob Hawke told AAP:At the moment we all have to buy the necessities; if you're not buying them you can't live. And you buy them now out of your after-tax income, after it has suffered these very high, oppressive marginal rates.Bob Hawke was saying that you actually pay a very high level of income tax and then you have to buy the necessities of life, which already have hidden taxes embedded in them. He went on to say:The best way of making these taxes operate effectively and efficiently is with minimum exemptions and with a single rate; that is the lesson which comes from all over the world.The problem that we have as Australians—whatever our socioeconomic circumstances, whatever our political affiliations—is that we currently tax everything we are trying to encourage. We tax productivity, employment and savings—and then we wonder why we are not doing quite so well in those three areas.Our revenue raising concentrates predominantly on income, both personal and corporate, in addition to wholesale sales tax on three principal goods—durables, motor vehicles and beer—all of which represent a diminishing share of household expenditure as it shifts to services, now 70 per cent of our economy and largely untaxed.What may have escaped the attention of the House is that last financial year, for the first time since Federation, government receipts were down as a proportion of GDP. To some extent it was due to the reduced dividend from the reserve because of the appreciation of the dollar the year before. But it was largely because the base upon which we are trying to raise our money to finance essential social infrastructure is eroding.These are the problems. In 1954 you had to earn 19 times the average wage to be on the top marginal rate. Today it is only 1.4 times average weekly earnings, and in seven years time you will be paying the top marginal rate as an average wage earner. The second problem we have is that the Income Tax Assessment Act in 1936 was 120 pages; it is now over 3,300 pages, having doubled in size over the past seven years alone. In fact, David Koch, the respected finance commentator, told me last year that the average tax agent has to read 25 pages of tax rulings and interpretations just to keep across changes in tax law.The third issue that we all confront, and this is particularly important, is that at the end of World War II, as Tony Blair observed when he was addressing the Trades Unions Congress in Britain on 9 September last year, there were 100 segmented markets throughout the world. The world has essentially coalesced now into three major trading blocs. If my children are likely to have a job and to carry the reasonable expectation of having one, we actually have to be a part of that trading environment. Yet, as we try to compete in an increasingly competitive world, we in Australia lumber our exporters and our manufacturers, at least what is left of them, with input taxes with which their competitors are not lumbered. They have to compete on international markets where you simply cannot increase your price to offset input costs that are unique to the country of origin.We add an impost of between three and five per cent to everything that goes across Australia's continental shelf into international markets. Only Botswana, Jordan, Swaziland, Pakistan, the Solomon Islands and Australia have wholesale sales tax without some kind of broad based, indirect tax. In fact, Coopers and Lybrand, which published a report in September 1997 on this, found that 143 countries impose a broad based, indirect tax of some form on goods and services—109 of them are VAT and 34 of them are general taxes on goods and services. As I said, only six countries, of which Australia is one, have just a wholesale sales tax.A company that tries to operate across Australia faces 42 state and federal taxes before it gets to any kind of industry specific tax. The taxes paid by businesses depend on the type of structure. At the moment in Australia, companies structure themselves legally around the tax system. The tax system drives the structure of corporations in Australia rather than the other way around. The previous speaker was quite right when he said that a GST would not eliminate the black economy. I do not think there is a tax system known to man that will. But a multistaged tax, as a GST is, will make considerably more inroads into it than the current tax system.I recommend to honourable members opposite the electronic commerce task force report from the Commonwealth Law Enforcement Board released, I think, in March 1996. Have a look at the impact that electronic transfers are having on the way we do business in Australia. Have a look at the way in which you can set up companies offshore and run them from Australia and the way you can move large sums of money around without having to have a big suitcase and a rottweiler by your side. All this is eroding our tax base. But, in the end, you have to spend it.The other problem that we have is that, if you are a single income family earning $24,570 a year and you increase your income to $33,150, you are actually $24 a week worse off. You are worse off because you lose $6,435 in benefits and you pay almost $5,000 in tax. The government's tax package—in reducing marginal income tax rates, introducing a broad based, indirect tax, reducing tapering rates for welfare benefits and streamlining the 12 family benefits into three—actually provides incentives for people to work harder and earn more money. How often do you hear people say, `I am wasting my time earning more money, I'm wasting my time going to work—I would be better off on the dole and living on social security'?Finally, Mr Beazley said on 30 April 1996 that revisiting the consumption tax debate would not be helpful to the ALP. It is not helpful to the government either, but sometimes you actually have to do something that serves the interests of the nation. And that is what this is all about.12:43:001698Smith, Stephen, MPMr STEPHEN SMITH5V5PerthALP00—These goods and services tax bills are bad legislation, bad economic policy, bad macro policy and bad social policy, and they should be rejected by this parliament in their entirety. I associate myself with the remarks made by the Leader of the Opposition today and I support the amendment moved by the Deputy Leader of the Opposition.This is bad economic policy because the combination of these bills will have a whole range of serious and adverse consequences for our economy. They will increase inflation, interest rates and unemployment. They will have no net beneficial effect on trade and they will not have any sensible, beneficial consequences for Australians so far as jobs and their family living standards are concerned.The previous speaker, when he was not talking about health, made some comments about the trade implications of this piece of legislation. That reminded me of the Treasury research paper that Matthew Ryan, the bloke who was 2IC or somewhere in line in the government's tax committee, wrote in September 1995. In that paper he says, on the question of whether a goods and services tax or VAT system has any beneficial consequences for trade:. . . it has long been understood that there is essentially no trade effect resulting per se . . . That is on page 7 of his paper. Later on in his paper in chapter 3, he provides a quote which says:The introduction of a VAT would have little direct effect on trade but would probably induce capital movements that would worsen the competitiveness position of (domestic) companies.No net beneficial trade or general macro-economic effect is going to occur here. We will simply see an increase in inflation, an increase in interest rates, an increase in unemployment, no increase in growth and no causal increase in our trade performance.We have heard speaker after speaker from the other side saying, `This is reform.' This is not reform; this is the adoption of a 1960s European taxation system that is not relevant to our society. If you want to speak about economic reform that might actually be relevant to our country, you need go no further than today's Financial Review. Today is the 15th anniversary of the floating of the Australian dollar by the Hawke government, with Paul Keating as Treasurer. Alan Mitchell, who is not someone you would necessarily regard as a friend of the Labor Party, says in his piece today:Fifteen years ago today, Bob Hawke and Paul Keating floated the Australian dollar and abolished exchange controls . . . A decade and a half of reform that has helped transform the economy and strengthen it for the unexpected blow of the Asian financial crisis.The Australian economy is, as a result of what the Hawke and Keating governments did, more competitive, more productive and less inflation prone. Its productivity growth has gone from being one of the worst in the OECD to above average.That is the type of economic reform that you need—not an unfair tax that puts the burden on those people who can least afford to bear it or a tax for which the macro-economic effects will be adverse for our country.I have been elected to this parliament on three separate occasions. In 1993 the coalition went to the people with a goods and services tax and they were resoundingly rejected. In 1996 the now Prime Minister stood up on behalf of the coalition parties and, when he was asked about a goods and services tax, said, `Never, ever. We are not going to do it.' In 1998 when he came back with a goods and services tax, having done the policy flip-flop again, 60 per cent of the Australian community, as reflected by the House of Representatives vote and the Senate vote, effectively rejected that view.If the Prime Minister is interested in reform, let us not have an outdated goods and services tax. When he was Treasurer and he left the Treasuryship to the Hawke government, with Paul Keating as Treasurer, he left us with double-digit unemployment, double-digit inflation and a budget deficit, calculated in today's terms, of about $26 billion. Yet he sits there and makes disingenuous comments about a $10 billion deficit. When the now Prime Minister had the report in front of him in respect of floating the Australian dollar and deregulating the Australian economy, he sat there frozen with fear. It took the Labor government to make the changes that the Financial Review is now saying were the real things that have buttressed us from adverse economic conditions.I am very disappointed that the Minister for Financial Services and Regulation is not here. He told me yesterday across the table that he would be here for the full 40 hours.Mrs Sullivan interjecting—5V5Smith, Stephen, MPMr STEPHEN SMITH—I am now told he is out to lunch. How appropriate; just like the government on economic policy—out to lunch. I did notice that he gets an oblique reference on the front page of today's paper as well. The minister for financial services, who was touted as the big replacement for the golfer's son—which is no recommendation in itself—on day one of his ministerial career made an enormous gaff, which was reported in the Australian on 20 October as follows:Joe Hockey, 33, the new Minister for Financial Services and Regulation, opened the foot-stuffing when he was earnestly giving ABC radio listeners the full benefit of his knowledge about Asia and the role of currency speculation in the region's economic problems.2K6BROUGHMr Brough—Mr Deputy Speaker, I raise a point of order. This is a wide-ranging debate but I fail to see the relevance of the minister making a statement in the press to the bill before the House. It was totally unrelated and I ask you to bring the member back to this debate on tax reform.5V5Smith, Stephen, MPMr STEPHEN SMITH—Mr Deputy Speaker, on the point of order, the government has touted their tax reform package as the reform of the century. I am making a point about reforms to the Australian economy to deregulate it, float the dollar and float exchange rates. I am about to make a point about this minister's attitude to a floating exchange rate.10000DEPUTY SPEAKERMr DEPUTY SPEAKER (Mr Andrews)—I take account of what the honourable member for Longman has said but this, from my observation, has been a reasonably wide-ranging debate and in those circumstances I will allow the member for Perth to continue.5V5Smith, Stephen, MPMr STEPHEN SMITH—I make the point that, in the absence of the Minister for Financial Services and Regulation, I will not give him nearly half the bagging I would have given him if he were here. The report went on:`You wouldn't speculate in the ringgit, which is Indonesia's currency, because you'd be risk averse. . . `You'd be inclined not to speculate in that currency because of certain financial instability in Indonesia.' Valuable advice, Joe. Just a pity that the unit of currency in Indonesia is the rupiah.Why is that point relevant? Here we have the minister for financial services sitting beside the now Prime Minister, the former Treasurer of the Commonwealth who was frozen with fear and would not deregulate the Australian economy, would not float the Australian dollar and would not see the floating of exchange rates.In the last six months, if the exchange rate had not been floated and the dollar had not been floated, what would we have seen? We would have seen the cabinet meeting daily to rejuggle the exchange rate, with the minister for financial services no doubt being asked to come in and give advice on Asian currencies which he does not have floating around in his mind.That was the first occasion when the Minister for Financial Services and Regulation embarrassed himself. He also embarrassed himself and the government on the four pillars policy the other week, when he said on ABC radio:That is a good question. I don't think there is any particular issue that is sacrosanct in relation to the regulation of financial services. Nothing is set in concrete.The Prime Minister made it pretty clear subsequently that that was not the government's view. I mentioned in passing that the minister got a reference on the front page of today's Financial Review . An article on the four pillars policy says:National Party Queensland MP Mrs De-Anne Kelly also condemned the pressure Mr Argus was exerting on the Government to water down its anti-merger stance.`The four pillars are set in concrete . . . 'Who is running the show here—the National Party backbench or the Minister for Financial Services and Regulation?10000DEPUTY SPEAKERMr DEPUTY SPEAKER—I would say to the honourable member for Perth that he is wandering from the topic now.10000Smith, Stephen, MPMr STEPHEN SMITH—To return to the bills, in the very limited time that the guillotine has made available to me, I have made the points about the inadequacies of the macro-economic policies of this government that are reflected by this legislation. But, in the micro, why are they so economically and socially bad? They are so economically and socially bad because they are unfair, because they place the greatest burden on those people who are least able to deal with it and cope with it. It taxes essentials of life, it taxes food, it taxes essential services—those things which ordinary families in Australian society who have least disposable income, who spend more of their income on those things which are essential services really need.In this package of bills—other than the great burden, the inequitable shift, which goes onto those families—you could not find the unfairness reflected better than by the outrageous taxation cuts that this package of measures carries with it. If you want to see some red hot, unfair and inequitable tax cuts, look at the tax cuts in isolation. This parliament ought to reject those tax cuts, whether they are a part of this particular package or dealt with in isolation.So there are very sound macro-economic reasons why this is a bad package of legislation. This is bad for the economy. It will be bad for inflation, bad for interest rates, bad for economic growth, bad for our trade performance and bad for employment. In the micro, it will have adverse effects on those families and people in society who can least afford to deal with it, particularly the elderly. The rate will only go up. The compensation package in the first instance is inadequate and, when the rate goes up in the future, the compensation package will not follow.I support the amendment moved by the Deputy Leader of the Opposition, and I hope when there is some sensible and decent review of this legislation in the Senate that the parliament will reject it.12:54:001701Brough, Mal, MPMr BROUGH2K6LongmanLP10—My children started to get over the boogieman but, after having to listen to that diatribe by the member for Perth, the boogieman is back to get us. That is what happened right throughout the election campaign. He stood up here and said, `We are going to have an increase in inflation, an increase in interest rates and an increase in unemployment, but we are going to have no increase in growth.' There is only one party in this country in the last two decades that has managed to deliver that—and consistently—and that is the Labor Party with 17½ per cent interest rates for housing and over 25 per cent for most of the businesses in my electorate. No wonder they were doing it tough. No wonder they wonder what is going to happen in the future if you mob manage to get your hands back onto the till. If that happens Australian business will be going down the tube yet again.They stand up here in some pious fashion and try to claim that something that they achieved 15 years ago—which they were duly given credit for—is somehow the reason why the Australian economy is doing so well today. It must hurt them awfully to sit over there and hear about five per cent growth. They see unemployment coming down, they see interest rates getting further cut, they see Australians with a greater sense of security than they have had in recent years. What must that do for them after they have just been defeated at the polls on the back of the biggest scare campaign that Australia has seen since 1993? It was pretty hard to believe they could outdo themselves, but they achieved it.They contradict themselves. I cannot help but comment about the member for Perth standing there and saying, `We introduced bank deregulation and that is why the Australian economy is so good today.' Where was it three, four, five, six years ago? Where was it when we had the recession we had to have? Was that because of bank deregulation? The reason that the Australian economy is strong today is that we have taken sound economic decisions.I am pleased to see that I have such a captive audience willing to listen today. Fellows, do listen: take on board what we are saying, and perhaps in the future you will change your point of view. Back in the 1980s when you recognised that a GST was the way to go, you put out documents, using federal government money, saying that a GST would provide the safety net, that it was going to be a fairer tax, that it would stop avoidance and clamp down on the cash economy. What has changed? What has changed in the last decade? What has changed is that you do not have the political backbone with which to support the policies you recognise will help Australia into the future.The bottom line is this: when you ask someone from New Zealand, our near neighbour, whether they like the GST, what do they answer? No. If you were to ask them, `Do you like income tax?' what would they say? No. If you ask people in Australia whether they like the wholesale sales tax system, for a starter they would not be able to tell you what the heck it is because they do not know that it is an insidious tax put on that no-one can see.The bottom line is that no-one likes taxes—I do not and those opposite do not—but we recognise that taxes equal income, that taxes are the single source of income for the government. So, if you turn this question around to the person from New Zealand and you say to this Kiwi, `Tell me, would you prefer to have the GST there now or the system there previously?' to a man they will say that they will take the GST they currently have. It is horses for courses. It is a better system that has delivered better results for the New Zealand economy and for the people of New Zealand. It goes back to the bottom line—nobody actually enjoys the experience of paying taxes.Tax equals income, as I said. Expenditure equals services: pensions, health, social security, defence, education—all the things which makes ours a just society. Without taxes and income we cannot supply the services. The Labor Party recognised, throughout their last 10 years in government, that the current tax system simply was not going to provide sufficient income to help provide the services that we demand as a compassionate society.That was shown when they started to increase not only the rates but the range of products in the wholesale sales tax system. In 1983, agricultural machinery, matches, implements for agricultural equipment, preparations for materials used in the agricultural industries were some of the ones affected. Machinery, implements, apparatus and refrigerating agents used other than in the fruit growing industry were all increased from zero per cent to 22 per cent wholesale sales tax. The average consumer out there did not know about it. They were not asked to decide whether it was something they wanted to vote for or against. It was done in this place, probably quite late at night, and without the knowledge of the average Australian.When people go along to the shops and find that prices have gone up, they do not blame the government; they blame the shopkeeper because he is trying to rip them off, he is taking a bigger profit. That poor beggar has had his margins come down more and more over the last 15 years. He has had to absorb that, and he has had to absorb the increases from zero to 22 per cent, zero to 12 per cent, 10 to 12 per cent and, in some cases like toys, toy jewellery, from zero to 32 per cent.Is this what the Labor Party calls `good economic policy'? How could it include things such as household disinfectants, swimming pool liners, tractors and ride-on mowers? Ride-on mowers are used by many small businesses in my area which are trying to make a go of it. What did the former government do? It slugged them with an increased tax. It put fuel excise up. All the time the taxes went up. I return to the key point: even the Labor Party recognises that we, as a just society, must have a tax base that can supply the services that we need in this economy.What does the ALP oppose when it opposes this bill? I ask those opposite: are you opposing the reduction of costs to the agricultural industry? Do you oppose the reduction of the fuel excise, particularly for the transport industry? Perhaps it is making health less expensive that you oppose, or maybe education. Do you oppose making child care less expensive? Do you oppose reducing the costs to our exporters, which are part of a growth industry in Australia and are creating more jobs? Perhaps you are opposed to cutting taxes and ensuring that 81 per cent of us pay less than 30 per cent in taxes. Do you find this range of things so abhorrent that you have to oppose them? Do you oppose simplifying the costs for business? Or perhaps you oppose the fact that high income earners—every one of us in this place falls into the category—will now have to pay if they use a valet service, a restaurant, a masseur or buy some luxury item, which nobody in my electorate, by and large, can afford to do. We do not have a lot of restaurants in the electorate of Longman. We are not a high income area. But the fact is that those people will be the very ones that will benefit the most from tax reform because they will have the growth in their pay packet. We will return to them the power of deciding for themselves what they will do with their money.Under Labor it is quite simple: people work for 40 hours, the government takes nearly 50c away from them and then they can decide what they do with the rest. We are saying to people, `Have the money. You earned it. You decide whether you want to save the money and have a responsible attitude towards it, whether you want to spend it on items or whether you want to provide for the health, education and wellbeing of your family.' That is choice. That is something that everybody in this place should support. But those opposite are obviously condemned by their actions because they are not interested in such an exercise.Mr Deputy Speaker, looking through the documentation put out by the government during the election, I have to say that not once did any member of the opposition or any member of the community ever dispute what was said about the cost savings to industry. Therefore, I have to ask myself why those opposite would decide, other than for political expediency, to take such a strong line on this. Why would they not be interested in cost savings to the petroleum and coal industry of 4.3 per cent? Why would they not be interested in cafes, restaurants and those providing accommodation reducing their costs by 2.8 per cent? Is not hospitality one of the biggest employers in Australia? For the dairy industry that I have in Maleny the rate will be 2.7 per cent; for bakery products it will be 3½ per cent; for the gas supply it will be 3½ per cent—of course, large industries are major users of gas—and for the transport industry it will be up around the seven per cent mark.Why are you opposed to a system of taxation which ensures that those who can most afford it will pay more of a percentage and those who are less able will benefit? Why are you opposed to a system which ensures the services that a compassionate society demands that we supply can be provided into the future? They will not be able to be supplied under the wholesale sales tax system as it currently stands. You have put forward a pathetic argument that somehow the rich are going to do better out of this. The top 20 per cent of taxpayers currently contribute nearly 60 per cent of the total tax-take. The bottom 20 per cent of taxpayers contribute two per cent.Mr Laurie Ferguson interjecting—2K6Brough, Mal, MPMr BROUGH—Two per cent, Laurie. So how much less do you want them to pay? Can you explain that to us?10000DEPUTY SPEAKERMr DEPUTY SPEAKER (Mr Andrews)—Order! I invite the honourable member for Longman to make his remarks through the chair and to direct his references to members by their electorate.2K6Brough, Mal, MPMr BROUGH—I take your comments on board, Mr Deputy Speaker. In winding up, it is quite obvious to me why the Labor Party are opposing this measure. They will oppose it at every stage. It is not because they do not believe in it: quite obviously they do; they showed that in 1985 and 1986 and they continue to believe in it today. The bottom line is that their greatest fear is that the legislation will get through the parliament because they know it will work. When it does work and it does provide a growth in income base, it will result in continued growth of the economy. When it results in more jobs, when it empowers Australian wage-earners, when it improves their standard of living and when it ensures that welfare recipients and those most in need have the sustenance, the money and the services to be able to have quality of life in Australia, they recognise that it spells doom for the Labor Party for the next decade. It is no wonder they oppose the overhauling and the updating of the Australian taxation system. They are condemned for their actions and they will be condemned by the people of the electorate for the pathetic decision regarding health rebates, which has them all squirming in their seats day after day as the member for Jagajaga takes them down some ideological path. They will also be condemned by the people in the electorate who will ask, `Why was I afraid of something? Why did they tell me so many lies when now in the light of day I find my quality of life has improved and I have job security, low inflation, low interest rates and more money in my pocket with which to make a decision.' I commend the legislation to the House.13:06:001704Ferguson, Laurie, MPMr LAURIE FERGUSON8T4ReidALP00—The previous speaker, the honourable member for Longman, as with many of his confreres, cited debates in the Labor Party in the mid-1980s—the fact that people within the party had supported similar but at least varied measures. That kind of ancient history, quite frankly, pales into insignificance compared with more recent quotes. The member for Deakin spoke of people who have had opinions on these matters and described them as `losers' or `retired people'. One person that fits into that category is the former Liberal leader, John Hewson. On 31 May, on Meet the Press , he made two essential points about this tax. When asked, he said that guarantees about keeping the rate at 10 per cent were `impossible'. We all know that is reflected in the pattern overseas regarding such taxes.A variety of speakers have said that the tax will be the greatest thing since sliced bread because most countries in the Western world have similar measures. These are the same people who say, `We really can't look at what happened overseas regarding increases at a later stage.' It is irrelevant that in 21 out of the 23 nations that they cite there were increases after the initial introduction. They also say it is irrelevant that, in the vast majority of those countries, in the three years after the introduction of similar tax measures there was no growth in the economy. It is also supposedly of no importance that countries that have, compared with most, weathered more recent financial crises better do not have similar taxes. Mr Hewson noted that the government's commitments were totally impossible. He also went on to say:Oh, 10 per cent to me is definitely too low and I don't think it will be believed by the electorate. When we consider the variety of parties that opposed this measure at the last election, we find that 60 per cent did not believe it. But the more important point is that the man—they talk about courage and guts over there—who did take this to the electorate and who was rejected very soundly, the man with experience who obviously persuaded John Howard that he should promise in 1996 to never introduce such a tax, has put it on the public record quite clearly that guarantees are impossible and that 10 per cent is a ridiculous level in the long term for this to be maintained.From the contributions of those opposite one would think that we were on the verge of Lyndon Johnson's Great Society or we were talking about the New Deal. We have heard the rhetoric from those opposite. They have talked about reform, tough decisions, a significant reform package and a tremendous reform package. What they are actually doing is nothing like those reform agendas. They are essentially imposing a tax on the vast majority of Australians, despite promises that they would never do so. Australian taxpayers were asked to fork out $19½ million—that is the latest figure—to finance a campaign in support of this measure. We talk about mandates and the mandate that they did get after that $19½ million of taxpayers' money.We have a political system in this country which, perhaps more than any other, favours a two-party system. I refer to the situation in the Senate. If the government wanted to get the voice of the electorate, the balance that people chose in the last election, they would not be so determined to make sure that the new senators have no say. The fact of life is that in the last election the vast majority of Australians voted for candidates who opposed these measures.The member for Cook talked about this tax reform providing `opportunities to save or consume'. This is a great liberating experience as far as he is concerned. Despite the previous speaker's defence of regressive taxation and advocacy of essentially hitting the poorer section of the population harder with income tax changes, the fact of life is that for a large number of Australians this is not a matter of `giving them freedom to save'. They do not have that opportunity; they do not have the income to do that. They essentially have no discretion over how they spend their money.As we know, in these measures a variety of essential services are hit. We can go through a variety of them. Services being covered here are vital to the survival of poorer members of the community. We have heard of educational fundraising being hit. In this society we are seeing more and more dependence upon the individual school communities as conservative politicians in this country retreat from public expenditure and support of public education. More and more, local communities are asked to foot the bill and increase the inequity within cities with regard to the different levels of schooling that can be funded. They are going to be hit.We have heard that the worst thing that can happen is that we have a tax system that has seven levels, two of which, of course, were introduced by those opposite. I do not think that it is necessarily regressive or wrong to have different levels. These can be wholesale sales taxes utilised to basically differentiate, to make decisions, to support what is quite worthwhile with regard to the environment, to look at the ways in which we can essentially subsidise what we desire, whether it is solar energy, recycling or the nature of paper.We can also do what has been anathema to those opposite—try to do something about the defence of Australian industry. As I say, there are various ways in which these wholesale sales taxes are not necessarily a bad thing in so far as they differentiate levels. The agenda over there is of supposed reform. What this is essentially about should be seen in the context of the government's wider policies. This is about ensuring that the tax burden in this country moves to hit the vast majority of people.The member opposite can dismiss the statistic that the top 20 per cent are getting 52 per cent of the benefit. That is essentially the main thrust of what they are about. An article entitled `The adverse economic consequence of extremely high capital-wealth inequality' by James A. Yunker in the Spring 1997 edition of the Journal of Post Keynesian Economics certainly paraphrases what they really believe. He said:Those who believe that the present-day capital-wealth distribution should be "left alone" are likely to point to the fact that the CGE model—the computer general equilibrium model—applied in this research does not take explicit account of innovation, entrepreneurship, and other such factors. In their view, the extremely unequal distribution of capital wealth plays an essential role in maintaining adequate incentives to innovation and entrepreneurship and serious efforts made to reduce this inequality by means of taxation could have extremely deleterious effects on the dynamic performance of the economy. This scenario is certainly a possibility, but its likelihood is questionable.What the government is essentially saying is, `We're going to spur industry; we're going to help encourage people by this shift of the tax burden.' Of course, that is accompanied by a thrust of other policies to deregulate the labour market, to ensure that juniors have the lowest possible wages, to ensure that people's employment is more easily terminated, to ensure—as we have seen in the last week or so—that the areas covered by awards in this country are decreasing the whole time, the latest instance being superannuation. They are making sure that we have no essential thrust to protect people in their occupational health concerns. As soon as they came in, they made sure that the collection and collation of statistics in relation to occupational health basically went out the door, to the point where this country now has a work safety record of deaths in the workplace which is worse per capita than that of the United States.The government is of course making sure that young people are further dependent on their families. Families on very low incomes are being forced to support their children rather than having general society help them with unemployment benefits. For the government to say that this reform is not aimed at moving the tax burden is at strong variance from the overall thrust of their policies.I heard the Deputy Prime Minister, Mr Fischer, on Meet the Press last weekend tell us his kind of analysis as to what we should do in this country. He said:The gap between rich and poor is something you do have to be deeply worried about. It's closed up by degrees. You are lifting more people up with a plus five per cent economic growth wave rather than a minus five per cent economic growth wave.The fact of life is, as he well knows, that there has been decreasing equality in this country. Our cities are increasingly divided between different socioeconomic regions. We are seeing a government that is not focused on real tax reform using the fact that there are, essentially, major problems with the system, as seen in Ross Gittins' article this morning about the growth of subcontracting and independent contractors. Nothing is being done about the very extensive amount of money that is escaping the system because people are distorting that loophole—in my own electorate I had the instance of an employer actually requiring that all the workers become independent contractors in that factory. It was a very large employer who requested that. Rather than tackling those essential problems in the system, half the federal ministry's approach to tax reform in this country is to get themselves into personal trusts. That is the kind of response we have from those opposite—basically to see the possibility of a loophole and to exploit it.So to come here and say that, because we have a situation where there are major problems with tax reform, the result should be to give everyone in this country a new 10 per cent tax, to not properly compensate people, and to pretend that pensioners will actually in the long term receive four per cent—and we all know that a significant part of that four per cent is legislated already in regard to CPI movements and guarantees of their percentage of average weekly earnings—is total hypocrisy.This tax is a major attempt to shift the burden in this country. The previous speaker made a very passionate complaint that the wealthy pay too much tax, and the member for Eden-Monaro actually put forward the preposterous claim that the top 20 per cent were going to be hit more by these changes. The fact of life is that, as the Melbourne Institute says, the impacts are five times greater in some cases for those people on low incomes. This is a move in the wrong direction. It is a move the Prime Minister said he would never undertake. In the sad face of political reality, he went back on that very major commitment.13:17:001706Thompson, Cameron, MPMr CAMERON THOMPSON84CBlairLP10—The member for Reid made some comments that I thought were a little over the top. He said that the government was looking to guarantee that juniors should have the lowest possible wages. That is a false presentation of what the government is trying to do in relation to youth wages. What we are trying to do is get young people jobs. I think one of the important factors of this government's tax reform package is that it is tailored to provide jobs and it is tailored to do something that, at the moment, the opposition in this place does not seem to want to do.Another point the member for Reid raised was in relation to the poor. I represent the electorate of Blair and I wonder, really, whether members opposite know many of the poor people in this country. Many of them are on farms. I was reading an article just the other day which said that in the last year the average income on a farm was $2,000. I do not know whether it was average, but it was income across a large proportion of the farming sector. It was $2,000 a year, which I think is absolutely pitiful. It is something that leaves the country in a very debilitated state, and it is something that I think we should be addressing. But to talk about poor people and say that this tax reform package is not going to help them is quite hollow.Another point I would like to address is that the member for Reid claimed there was a government agenda to get local communities to foot the bill. I think that when it comes to this tax reform package, entirely the opposite is the case. What we are setting out to do through this tax reform package is to give all the income, all the revenue, that is generated by the government's goods and services tax to the states—to give that money down there where the services are being provided.There is something that members opposite might like to recall. The former Prime Minister of Australia, Bob Hawke, just before he was stabbed by his successor, indicated that he wanted to renegotiate a better condition between the Commonwealth and the states—a new position that would ensure that the states had better financial viability and more capacity to deliver the services that Australians all need. Through this tax reform package we are delivering that up—we are following through on that in a financial sense, and I think the opposition should be giving us credit for doing something that they abjectly failed to do.As the new member for Blair, I have a certain perspective on this tax legislation that is unique. Since the day I arrived in this place, members from both sides have commented on my, fortunately, successful efforts to defeat the leader of the One Nation party. I can say without hesitation or contradiction that this tax reform package did more to defeat the former member for Oxley when she ran for the seat of Blair than any other point of debate in the recent poll. Contributions such as those made by the Minister for Defence, John Moore, the Minister for Employment Services, Tony Abbott, and even the Reverend Tim Costello were significant, but, in the minds of voters in Blair, it was tax that mattered.The need for tax reform galvanised Australians at the recent poll. In the seat of Blair I attended a total of three community forums. All were well attended and all were dominated from beginning to end by the topic of tax reform. In the same way that in the state campaign the former Queensland government found itself transfixed by questions about One Nation, so in the federal election the One Nation party found itself transfixed by questions of tax.Now that the threat posed by One Nation has diminished, members might like to think that One Nation's eccentric views on tax are largely irrelevant. That is not the case. The need for tax reform is a driving force behind many of those disaffected elements that joined together to form One Nation in the first place. Taxes and red tape are creating too much of a burden for small business. These are the taxes fervently supported by the Labor Party—taxes that contain so many traps and inconsistencies that they baffle the average shopkeeper or garage mechanic, just as on occasions we all are baffled.In 1993 the Australian Labor Party took advantage of the anger about the mess that our tax system has become. They successfully painted the changes proposed by the then opposition as adding to the burden of tax, when in hindsight, quite clearly, the opposite was true. Australians were taken along for the ride by the former Prime Minister Mr Keating and the man who huffed and puffed his way through a speech on this topic this morning, the present Leader of the Opposition, Kim Beazley.The opposition have tried to follow in the footsteps of their mentor, Paul Keating, but on this occasion the Australian people are having none of it. Labor is getting a good reception from the converted, and that is why Labor did so well at the recent poll in shoring up its vote in its traditionally safe seats. But for the average Australian their scare tactics are worth nothing. At the recent poll in Blair, their GST scare tactics were not worth the many thousands of pieces of scrap paper they were printed on. There are three letters the people remembered at this election. They were not GST; they were l-a-w.In the electorate of Blair, the same community forums that waded carefully through question after question on the government's tax reform package completely ignored the hollow tax proposals being offered by the opposition. The only comment offered on those occasions was loud condemnation of the ALP's proposal for a retrospective capital gains tax. I felt sorry for my Labor colleague on the campaign trail. Virginia Clarke is a very nice person, but in the tax debate she had about as much credibility as Christopher Skase at a creditors' meeting.There is no doubt that Australians want a better tax system. At the recent election, they made a clear decision about who was best to deliver it. In Blair, One Nation's crazy easytax scheme—the idea that revenue could be raised by taking two per cent of every transaction—had more credibility than the hollow and negative views of the ALP. That is not to say that, to the people in the elector ate, the former member for Oxley was a credible authority who could be trusted on tax. The simple fact was that in every town hall, in every room where tax was discussed, people had a very strong idea who it was that they could not trust. They could not trust Labor. They wanted reform. They were naturally scared off the coalition's package by the sheer volume of propaganda being directed at it, but, when it came to the crunch, they just could not stomach another round of Labor lies about tax.So the tax debate in my electorate revolved around a fair dinkum assessment of the coalition's proposal compared with the compendium of nonsense presented by One Nation. It was a lay-down misere. They listened to the One Nation leader—but a two per cent tax on every dollar you put into the church collection plate? A tax that would allow a millionaire to go on a snow skiing holiday to New Zealand each time he had a million to bank and still dodge his tax liabilities? It was the absolute death of them.I thank the Treasurer and the coalition for providing the long awaited ammunition to do the job. We need to pass this legislation to show Australians that there is a much better way to administer the gathering of revenue in this country. Importantly, this tax has a long-term perspective that will enable the Commonwealth government and, importantly, the states to project a long-term trend in revenue growth many years into the future.Members opposite have sat around a budget table. They know that, under the existing system as it applies in this country, when they are looking to draw up their budget—or when a state government is looking to draw up its budget—the first thing that happens is that they set out to cut. They set out to cut things because the only way revenue can be raised under the existing system is to introduce new hidden taxes. The reason why we have to do that is that revenue is falling—revenue that we get into the system is reducing every year, and so we cut to overcome it. When that fails, what do we do? We set about finding ourselves some new hidden sources of revenue that can be used to prop up the situation, and that is what the Labor Party is proposing— that we stay with this rear-vision mirror view of running the economy; that we drive backwards in our car, looking in the rear-vision mirror. And that is the way we run the economy of this country, Mr Speaker? It is a joke. How can you come up with a system that provides for the future needs of this country when you are looking to the past all the time?During the election campaign, the former industries minister John Moore made the point that, given the increase in revenue that will be generated over time by the tax proposals of the government, we could, for example, eliminate payroll tax in Queensland. Queensland is a low tax state and it deserves credit for the effort it has gone to to keep low taxes but we could, over time, move to eliminate taxes in that state still further. That is something that we should all look forward to with relish.On the other hand, if it were something that was a priority of the government of the day, we could improve health services or teacher numbers. All those things are ahead of us because we have, under this proposal, a tax system in which tax revenue will grow as the economy grows. I think that is a very important objective for us to have. We should get away from the situation in which we are driving backwards down the street—looking at our own navel instead of looking at what the country needs.In closing, I would like to say something on a lighter note on the question of easytax. I noted in some research I got from the library that in 1967 eight countries applied a type of easytax. None of them do any more. It was all done as a result of wartime revenue raising, and it was—without doubt, according to this briefing—a complete dud.13:29:001708McLeay, Leo, MPMr LEO McLEAY4I4WatsonALP00—This has been an interesting debate. Unfortunately, there has not been enough time for people to be able to suss out all the things that are wrong with the GST. If you listened to the government speakers in the debate, you would think that all they are talking about out there at the football and in voter land is tax reform—you go to the football and they come up and tell you, `Tax reform, tax reform.' You go to the movies and they come up and tell you, `Tax reform, tax reform.'Obviously none of the people from the government hear anyone telling them that the real issues in this country are about jobs, health and education. The government will tell you that this tax reform is about the only thing that is going to be any good for the country. They say it will make us more productive, more competitive, help exporters, deliver more jobs and increase living standards. About the only thing they have not claimed about the GST is that it will cure dandruff—but there is a little while left to go in this debate, and one of them will probably even claim that. No doubt the minister at the table might end up claiming that, because he does not know the difference between a ringgit and anything else, so dandruff is probably one of the things that will solve the problem for him with the GST.If the GST is so terrific, why are people so suspicious of it? Why aren't people welcoming it the way the government thinks they should? Why don't people believe the government's rhetoric? I will tell you why: because not everybody is as gullible as the government likes to think they are. We know—and the electorate knows—that the proposed GST will not be a panacea for the deficiencies of the current system.We are aware of overseas experiences of this 1960s tax. The previous speaker said that we should look forwards rather than backwards. The government had to look back to the 1960s to find the GST. Most of the countries in Europe with a GST got it in the 1960s; they did not get it in the 1980s or the 1990s. The overseas experience is a very salutary thing, because we know that the outcome of the introduction of those taxes did not provide the utopia that those governments said they would.We see from the overseas experience that the GST rate rises. It is no good the government trying to reassure the House and the voters by saying that it will only rise here if the states want it to rise. Why wouldn't the states want it to rise, particularly when they will get the revenue from it and the Common wealth will have the responsibility of raising that revenue?I remember one of the interesting sayings of former Prime Minister Keating was that the most dangerous place to be in this country was between a bunch of state premiers and a bucket of money. What the government wants to do with this GST legislation is put the taxpayers between a bunch of state premiers and a bucket of money—probably the most dangerous place to be in this country. The government does not want to put itself there; it wants to put ordinary taxpayers there. I guess one could not blame the state premiers for sitting back and thinking, `Christmas really has come because the Commonwealth is now going to give us a bunch of revenue that it will raise and that we will have the key to.'The government thinks people should think that this is a clever tax. It also says that the states would have to be unanimous in their decision to raise the rate. I have not seen a state premier yet who is not willing to say, `If you want to give me more money, I am happy to have it.' I think Paul Keating was right: the most dangerous place in Australia is between a bunch of state premiers and a bucket of money, and I do not see why the government should want to put ordinary taxpayers there.What will happen to taxpayers when the government puts them in that dangerous position? Prices will rise. Sure, the government says that wholesale sales tax will disappear, but it will be replaced by the GST. Only those who believe in fairy stories or fairy godmothers—and the Commonwealth will be the states' fairy godmother in this—would believe that the sellers of goods will offer them at a lower price.If the government does believe that prices will come down, why doesn't it allow the GST to be shown separately on dockets? It is not just the opposition saying this. In fact, the other day at the annual general meeting of Woolworths the chairman, John Dahlsen, told shareholders that Woolworths would prefer the GST to appear as a separate item on dockets rather than be hidden in the price of each item, as the government has indicated is its preference.Mr Causley interjecting—4I4McLeay, Leo, MPMr LEO McLEAY—We have a bit of an echo here from cocky's corner. The member does not actually have the drift of it because, had he listened to the previous speaker, he would have said, `The reason the wholesale sales tax is terrible is that it is a secret tax.' The government is just substituting another secret tax for one that it is claiming is a secret tax. If the GST is so terrific, why doesn't the government let it come up on the bill every time?DK6HOCKEYMr Hockey—Because it is 10 per cent on everything—4I4McLeay, Leo, MPMr LEO McLEAY—Because it is 10 per cent of everything that comes up, and the government, most particularly, does not want the taxpayers to know that every time the till is rung up they are paying an extra 10 per cent put on by the government. This is one secret tax the government wants to keep very secret because the government knows there will be profiteering from this. The government knows that and the government will not do anything about it.And that is what ordinary voters know. Ordinary voters know that there will be profiteering from this and that the government will not do anything about it. Voters know that this tax has not worked overseas. They know that the world's biggest economy—that is, the United States of America—does not have a GST. They know that some countries, such as Italy, regret that they have introduced a GST. But voters also know that once a GST is introduced it is difficult, if not impossible, to dismantle it.That is why we, as the opposition, are so vehemently opposed to the introduction of a GST. It does not work. It is a regressive tax, a tax on jobs, and the poorer you are the harder it will hit you, because it will apply to the necessities of life which currently are not taxed. Things that we all have to buy, like food and clothing, which currently are not taxed, will now be taxed. We are talking here about items that people cannot get away from. These are not discretionary items, unless the government believes that food is a luxury.Research by the Melbourne Institute of Applied Economic and Social Research has shown that food takes up 24.6 per cent of the expenditure of lower income families but only 12.5 per cent of the expenditure of families on incomes like those that politicians have. Imposing new taxes on food, which is what the GST will do, will hit the most vulnerable in the community the hardest. Of course it is not just food that will have a GST, there are a lot of other items.The government has claimed that the GST will assist businesses by reducing the tax burden on them, but there will be a very high price on that. It will be at the expense of the individual. Small businesses that the government says it will look after will be most hit by this. The number of tax points will increase from about 70,000 with the wholesale sales tax to millions with the GST. All that the government has put forward is a $500 million package to help businesses overcome these compliance costs, and every day the Treasurer expands the number of categories of people who will be able to get their hands into this $500 million. Businesses will have to face large set-up costs, training of staff, professional advice, et cetera, and significant outgoings relating to the compliance requirements.But there is another furphy about the GST that the government will not nail, and that is the black economy. We have heard government speakers in this debate get up all the time and say that this will cut down the black economy. A GST in fact increases the opportunities for tax evasion, it does not reduce them. It certainly increases, rather than reduces, the incentive to operate in the black economy.If a plumber goes to the hardware store to get a tap for Mrs Jones, he finds that the tap costs him $9 and he pays 90c GST on it. He charges Mrs Jones $50 to put the new tap on. For the plumber it is a simple choice: he can claim back his 90c GST or he can pocket the $5 that he would have to add on to the $50 he charged Mrs Jones for the plumbing.And the government thinks this is going to stop the black economy? This is going to increase the black economy, because voters are not the mugs that the government thinks they are. If people in the black economy now are dishonest, they are not going to become honest overnight because the GST is there. Are they going to say, `I should claim the 90c so that I can pay the government back $5'? What a joke, and the government knows it is a joke.There are more hidden problems in this tax than the government is willing to tell the voters; there are more problems in this tax than the government is willing to reveal. The government knows that this is tax reform for the sake of the Prime Minister having something to say. It is not tax reform for the sake of Australia. It is certainly not tax reform for the sake of the vast majority of Australians who are on ordinary wages and salaries.This package of taxes, with the compensations that are in it, takes money from those who do not have it and gives it to those who do not need it. This is a massive bribe for people who do not need the money. The government should be using tax reform to chase people for the massive $800 billion that we believe could be achieved by looking at trusts and by attacking those people who are into tax evasion and avoidance in a big way. The government should not be using tax reform to chase ordinary people who are trying to make a living, or to tax pensioners and ordinary income earners 10 per cent on everything they buy. This is a disgraceful, outdated, old-fashioned tax and should not be supported.Debate (on motion by Mr Causley) adjourned.Address in Reply171117111711Mr DEPUTY SPEAKERMr DEPUTY SPEAKER (Mr Nehl)10000PON/A10—I have to report that the order of the day on the resumption of debate on the address-in-reply has been returned to the House from the Main Committee.Ordered that the address-in-reply be taken into consideration forthwith.10000Mr DEPUTY SPEAKERMr DEPUTY SPEAKER—The question is that the address-in-reply be agreed to. Question (by Mr Hockey ) put: That the question be now put.13:44:00The House divided. (Mr Deputy Speaker—Mr G.B. Nehl)73Abbott, A. J. Anderson, J. D.Anthony, L. J. Bailey, F. E.Baird, B. G. Barresi, P. A.Bartlett, K. J. Billson, B. F.Bishop, B. K. Bishop, J. I.Brough, M. T. Cadman, A. G.Cameron, R. A. Causley, I. R.Charles, R. E. Costello, P. H.Draper, P. Elson, K. S.Entsch, W. G. Fahey, J. J.Fischer, T. A. Forrest, J. A. *Gambaro, T. Gash, J.Georgiou, P. Haase, B. W.Hardgrave, G. D. Hawker, D. P. M.Hockey, J. B. Hull, K. E.Jull, D. F. Katter, R. C.Kelly, D. M. Kelly, J. M.Kemp, D. A. Lawler, A. J.Lieberman, L. S. Lindsay, P. J.Lloyd, J. E.Macfarlane, I. E.May, M. A. McArthur, F. S. *McGauran, P. J. Moore, J. C.Moylan, J. E. Nairn, G. R.Nehl, G. B. Nelson, B. J.Neville, P. C. Nugent, P. E.Prosser, G. D. Pyne, C. M.Reith, P. K. Ronaldson, M. J. C.Ruddock, P. M. Scott, B. C.Secker, P. D. Slipper, P. N.Somlyay, A. M. Southcott, A. J.St Clair, S. R.Stone, S. N.Sullivan, K. J. Thompson, C. P.Thomson, A. P. Truss, W. E.Tuckey, C. W. Vaile, M. A. J.Vale, D. S. Wakelin, B. H.Washer, M. J. Williams, D. R.Wooldridge, M. R. L.64Adams, D. G. H. Albanese, A.Andren, P. J. Bevis, A. R.Burke, A. E. Cox, D.Crean, S. F. Crosio, J. A.Danby, M. Ellis, A. L.Emerson, C. Evans, M. J.Ferguson, L. D. T. Ferguson, M. J.Fitzgibbon, J. A. Gerick, J.Gibbons, S. W. Gillard, J. E.Griffin, A. P. Hall, J. G.Hatton, M. J. Hoare, K. J.Hollis, C. Horne, R.Irwin, J. Jenkins, H. A.Kernot, C. Kerr, D. J. C.Latham, M. W. Lawrence, C. M.Lee, M. J.Livermore, K. F.Macklin, J. L. Martin, S. P.McClelland, R. B. McFarlane, J. S.McLeay, L. B. McMullan, R. F.Melham, D. Morris, A. A.Mossfield, F. W. Murphy, J. P.O'Byrne, M. A. O'Connor, G. M.O'Keefe, N. P. Plibersek, T.Price, L. R. Quick, H. V.Ripoll, B. F. Roxon, N. L.Rudd, K. M. Sawford, R. W. *Sciacca, C. A. Sercombe, R. C. G. *Sidebottom, P. S. Smith, S. F.Snowdon, W. E. Swan, W. M.Tanner, L. J. Theophanous, A. C.Thomson, K. J. Wilkie, K.Wilton, G. S. Zahra, C. J.Howard, J. W. Beazley, K. C.* denotes tellerQuestion so resolved in the affirmative.Original question resolved in the affirmative.10000Mr DEPUTY SPEAKERMr DEPUTY SPEAKER—Mr Speaker has ascertained that His Excellency the Governor-General will be pleased to receive the Address-in-Reply at Government House at 5.30 p.m. this afternoon. The sitting will be suspended at 5 p.m. Mr Speaker shall be glad if the mover and seconder, together with other honourable members, will accompany him to present the address.Bills1712r703Billsr658Billsr667Billsr666Billsr702Billsr699Billsr698Billsr657Billsr697Billsr665Billsr701Billsr663Billsr659Billsr700Billsr664Billsr660BillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBills1712Debate resumed.13:52:001712Causley, Ian, MPMr CAUSLEY4K6PageNP10—It is a pleasure to rise in the House and debate the A New Tax System (Goods and Services Tax) Bill 1998 and cognate bills. It is quite aptly named, I note, `A new tax system'. I have listened with some interest to the speakers opposite. In particular, I note that they have avoided the main issues at stake here and concentrated on a GST. They have tried to put forward the scare campaign that they did so well in the election campaign, and which was rejected by the Australian people, that all things would rise in price with a GST. I note that they deliberately skate around the fact that the wholesale sales taxes that are presently in place will be removed.I heard the Leader of the Opposition this morning blustering on in a speech that if you went to the gym it would be taxed. The Treasurer is not going to get too much tax out of the Leader of the Opposition—I do not think he is going to be going to the gym—but the fact is that he avoids the fact of life that on all sporting goods at the present time there is a 22 per cent tax. So people who are in the sporting field and using all this sporting equipment will have reduced tax on the equipment that they are using.I have not heard anyone on the opposition benches talking about cosmetics, for example. Cosmetics at present are taxed at 30 per cent, yet that rate will drop to 10 per cent. If you look at so-called luxury goods—televisions, radios, videos, and sound equipment for kids—the present tax rate is 30 per cent, yet it will drop to 10 per cent. We do not hear that in the debate from the opposition: they want to avoid all those references.One of the things that comes through loud and clear to me is that ideology is driving the Labor Party in this debate. They want to drag everyone down to the same common denominator, the lowest common denominator. They do not want to see any incentive in the system in Australia. One of the problems we have is that incentive has been removed. What incentive is there for people to go out and have a second job? What incentive is there for a family to have two jobs? The current tax system means that people get less in their pay packets than people on the dole with two or three children. Incentive has gone from the system.Most people in this chamber would know my background but I will remind you of just a little of it. I was one of those who gave up a teachers college scholarship and went canecutting for my first job. That was a few years ago. In 1958, when I was receiving my first pay packets, and working very hard as a canecutter, I was earning £100 a fortnight in some instances. The tax on that £100—yes, it was pre 14 February 1966—for the fortnight was £20. I was a single person. I still had £80 left over. That was a lot of money in those days. There was incentive in the system in those days so that you could go out, you could work, you could save, you could invest and you could better yourself. Those incentives are gone in the system that we have today.The Treasurer has said on a number of occasions, and there is no doubt—and even members of the opposition quietly admit—that the tax base is getting narrower. The only way that you can run the country and raise the funds that are necessary to run the country is to increase wholesale sales taxes and to increase personal tax. We saw that very clearly in 1993, when the then Prime Minister, who had campaigned very strongly against the GST at the time, came into the House and, at the dead of night, increased all wholesale sales taxes because he could not raise enough funds to run the country. It is a fact of life that the system has to be changed and the burden of taxation has to be spread across the community.The opposition also ignore the fact that the series of bills that is before the House also addresses those people who are minimising their taxes, who are creating trusts that deliberately reduce their income and also, of course, reduce the tax they have to pay.One thing coming from the opposition benches that I find quite amusing is the fact that they do not seem to understand that the people who pay the most tax in Australia at present are those PAYE taxpayers who have not got a second property. They are the ones who cannot avoid taxation. Other people who have got investment property can reduce their liability on tax. I think Fred Daly once said that poor people pay tax and rich people pay their accountant. That is quite legal, but there is no doubt that those people do minimise their tax. They are not avoiding tax, they are minimising their tax.The Labor Party are often prone to quote presidents of America. I think it was Abraham Lincoln who once said, and I paraphrase: You cannot build up the poor by dragging down the rich. That attitude seems to be absolutely paramount in the Labor Party. The Labor Party have also gone on at some length to say that they are going to defeat these bills in the Senate. I would like to say a few words about that in the remaining time that I have.One of the most pointed remarks that has been made in recent times was made by the Prime Minister himself after the Premiers Conference. I heard the member for Watson talking about premiers and the way that they would accept money. I think it was that the most dangerous place to be was between the premiers and a bucketful of money. But the point that was made by the Prime Minister is very relevant in this debate, because if anyone cares to go back to Federation, when this parliament was set up and when the Senate was set up, it was very clear that the role of the Senate was to be the custodian of states rights; it was the house that was to protect states rights.We have had all the premiers in Australia come to Canberra, discuss this package with the Prime Minister and the Treasurer, and agree that this is a tax reform that is necessary for Australia. If the Senate does anything else but listen to those premiers, then they are playing their own egotistical political games—that is all they are doing. It is about time the Senate realised what it is about: it is there to ensure that this House does not discriminate against the rights of the states. That is what they are there for and that is what they should take note of. For the Labor Party to say that they are going to govern in the Senate because they did not get the right to government in the lower house is an absolute disgrace. The Leader of the Opposition should hang his head in shame for even considering supporting such a proposition.Mr Melham interjecting—4K6Causley, Ian, MPMr CAUSLEY—The member for Banks, of course, would never consider that. As I said, this is a very important set of bills. Another thing that the opposition have never mentioned in this debate—Debate interrupted.10000SPEAKERMr SPEAKER—Order! It being 2 p.m., the debate is interrupted in accordance with standing order 101A. The debate may be resumed at a later hour. The member will have leave to continue speaking when the debate is resumed.Ministerial Arrangements17141714Fischer, Tim, MPMr TIM FISCHERDG4FarrerNP10—I advise the House that the Prime Minister will be absent from question time today. He is in Sydney fulfilling an important family commitment, then travelling to Melbourne to fulfil an official engagement this evening as co-chairman of the President's Cup.Questions Without Notice171417141714Crean, Simon, MPMr CREANDT4HothamALP00—I direct my question to the Treasurer. Has the Treasurer seen reported comments by Woolworths chairman, John Dahlsen, that Woolworths wants the GST to appear as a separate item on dockets rather than be hidden in the price of each item? Treasurer, why does your legislation on the new 10 per cent tax on almost everything allow the GST to be hidden? Why won't you put in place a mechanism so that people know the exact GST component and when a purchase is GST free and when it is not?1714Costello, Peter, MPMr COSTELLOCT4HigginsLPTreasurer10—The government has taken the view, as I told the House last year, that people should know the price that they have to pay at the checkout, and that will be the price that the goods are advertised at. With regard to a price inclusive of taxes, why was it that the Australian Labor Party's wholesale sales tax was hidden in every item in every good? Why was it that the Australian Labor Party never told you that when you went to buy your toothpaste you paid 22 per cent tax?DT4CREANMr Crean—Mr Speaker, I raise a point of order. It goes to relevance; that is, the question went to the comments of the Woolworths chairman that they wanted the GST to be dis closed. This has got nothing to do with the wholesale sales tax. The Treasurer should explain why he is hiding the GST in every purchase that every person will make.10000SPEAKERMr SPEAKER—The member for Hotham will resume his seat. The Treasurer has had barely 30 seconds to answer the question or be relevant to it; and I call him.CT4Mr COSTELLO—The government has one rate across all goods and services which everybody knows about. There is nothing hidden; it is 10 per cent. Everybody knows about it.ET4BEVISMr Bevis—On what?CT4Mr COSTELLO—It is across the board, the point that you have been making, genius, in this House of Representatives. But what did the Labor Party do with the wholesale sales tax? They hid it in every price. They still go on with it, Mr Speaker. Did the Australian Labor Party say that there is 22 per cent on your toothpaste? Did the Australian Labor Party say that there is 22 per cent on your paper? Did the Australian Labor Party say that there is 22 per cent on your biros?PE4BEAZLEYMr Beazley—What did the Liberal Party do with the wholesale sales tax?CT4Mr COSTELLO—Mr Speaker, he always yells the loudest when he is the wrongest. He hates it. He sits there and he tries to knock us off our game because he is trying to cover up a 22 per cent hidden tax.DT4CREANMr Crean—Mr Speaker, I raise a point of order, and it goes to relevance again. It is obvious for the second time that the Treasurer is avoiding the question of the call by the chairman of Woolworths, the second largest retailer in this country, for disclosure of the GST.10000SPEAKERMr SPEAKER—I have heard the point of order and I will rule on it. I have listened to the Treasurer. The Treasurer is making a comparison between wholesale sales tax and the way in which it is displayed and the proposed GST and the way in which it will be displayed. So I cannot deem that as irrelevant. In fact, the Treasurer is being relevant, and I call him.CT4Mr COSTELLO—Mr Speaker, not only is it up front, because everybody knows it is 10 per cent, but they know it is a uniform rate. The beauty of Labor's wholesale sales tax was that you could have 12, 22, 32, 41, 45 or 47 per cent. Nobody actually knew what it was, it varied and it was hidden, which gave the Australian Labor Party the opportunity to take the 10 per cent rate to 12 per cent, the 20 per cent rate to 22 per cent and the 30 per cent rate to 32 per cent, hidden, without one dollar of compensation.We on this side of the House are proud that we are going to sweep away Labor's wholesale sales tax. We are going to make this open and transparent. We are going to make a new tax system for a new century. This is the party of the future; that is the party of the past.17151715St Clair, Stuart, MPMr St CLAIR84BNew EnglandNP10—My question is addressed to the Deputy Prime Minister and Minister for Trade. What is the government doing to expand and diversify market opportunities for Australian exporters to build on the strong performance of the Australian economy?1715Fischer, Tim, MPMr TIM FISCHERDG4FarrerNP10—I thank the member for New England for his question. I am reminded of the fact that he represents an economic region which is very diverse in its export effort, ranging from services such as the international pilot training taking place at Tamworth—and I hope to attend a graduation dinner this week—through to a small company, Jakab Industries at Tamworth, and also Ruddweigh at Guyra, which is exporting weighing equipment to South America. That reflects the diversity of our export effort.I advise the House that total exports during the 10 months to October are up by 6.5 per cent. Exports to non-East Asia are up by almost 23 per cent. Significantly, this week, exports to Italy are up by 12 per cent, and exports to South Africa are up by 8.3 per cent.We had the visit to Australia this week by the Italian President. We also have the visit of the South African Minister for Trade, Alec Irwin, to Parliament House this day for the joint ministerial commission between Australia and South Africa.Our exports continue to grow and to diversify in terms of location—to places like South Africa, South America, the Middle East, Europe and elsewhere—and also in terms of content. This is helping to secure jobs in the export sector. Indeed, our ratio of exports to GDP is now around 20 per cent and nearly 1.7 million jobs are linked to our export efforts in both goods and services. We are not going to be complacent about this at the start of a second term. We have reactivated the Market Development Task Force, under the chair of Dr Ashton Calvert, to push the bilaterals strongly.We have been involved with various regional initiatives and I will continue to push the envelope of lateral thinking to bring about further breakthroughs at that level and, at the multilateral level, we prepare for the World Trade Organisation ministerial next year in the USA. We mean business in activating and further expanding our trade agenda. I am pleased to inform the House that the 1999 trade outcomes and objectives statement will be presented to parliament on 11 February, at the start of next year's sittings.17161716Crean, Simon, MPMr CREANDT4HothamALP00—My question is again directed to the Treasurer. I seek clarification of an element of his goods and services 10 per cent on almost everything bill. Treasurer, you claim that your GST is simple and that people will know how much GST they are paying. Can you confirm that your bill calculates the amount of the GST on an item as 10 per cent of ten-elevenths of the GST inclusive price? Treasurer, if it is so simple, could you tell the House the GST component of a GST inclusive grocery bill of $138.80?1716Costello, Peter, MPMr COSTELLOCT4HigginsLPTreasurer10—One-eleventh.DT4CREANMr Crean—How much?CT4Mr COSTELLO—One-eleventh.DT4CREANMr Crean—How much?10000SPEAKERMr SPEAKER—The member for Hotham does not have the call.CT4Mr COSTELLO—Mr Speaker, I answered the question: one-eleventh. What is his big point—it is a complicated calculation to divide 138 by 11? Is that your big point?DT4CREANMr Crean—Answer the question.UNKNOWNGovernment membersGovernment members— Simple Simon!10000SPEAKERMr SPEAKER—The member for Hotham does not have the call.DT4CREANMr Crean—On a point of clarification then, Mr Speaker—10000SPEAKERMr SPEAKER—There is no clarification.DT4CREANMr Crean—if it is so simple, how much is it on $143.40?10000SPEAKERMr SPEAKER—The member for Hotham will resume his seat. He cannot abuse the standing orders in that manner. He did not seek a point of order. The Treasurer has the call.CT4Mr COSTELLO—It is so simple. It is still one-eleventh. It is one-eleventh of any number you choose to bring out. Let me make the point about simplicity. It is simple compared with Labor's wholesale sales tax. Let me quote:. . . Australia already has a wholesale sales tax on many manufactured goods . . . the problem is that it does not . . . work properly. It taxes goods, such as cars, white goods and kitchenware, but not services, such as repairs, entertainment and restaurants. It has many anomalies. It has high rates such as 20 and 32½ per cent—DT4CREANMr Crean—Mr Speaker, I take a point of order on relevance. This aspect of the answer cannot be relevant to the question which asked him to simply tell the House the price on a grocery bill in his so simple tax.10000SPEAKERMr SPEAKER—The member for Hotham will resume his seat. The member for Hotham must know that the Treasurer's answer is relevant to the question.CT4Mr COSTELLO—It is simple, because it is one-eleventh, and there is one rate. It simplifies the current system which has so many anomalies, as I said. I quote:It has many anomalies. It has high rates—DT4CREANMr Crean—On a point of order on relevance: if the simple answer is one-eleventh, he should sit down. If he can't describe the amount he should sit down and let the people know.10000SPEAKERMr SPEAKER—The member for Hotham will resume his seat. The Treasurer has the call and the member for Hotham has been here long enough to know that the asker of the question cannot dictate the way in which the question is answered, and the obligation on the chair is to ensure that the person answering the question is relevant to the question. The Treasurer is relevant and has the call.CT4Mr COSTELLO—I will conclude very briefly. I quote:. . . the problem—with the wholesale sales tax—is that it does not work . . . properly. It taxes goods, such as cars, white goods and kitchenware, but not services, such as repairs, entertainment and restaurants. It has many anomalies. It has high rates such as 20 and 32½ per cent because it is imposed on a relatively narrow range of goods.And it has a high price effect—Who said that? It was the Australian Labor Party in their paper of July 1985 on why the wholesale sales tax should be abolished—and I table it.17171717Somlyay, Alex, MPMr SOMLYAYZT4FairfaxLP10—My question is addressed to the Minister for Finance and Administration. Can the minister inform the House about the progress of the government's efforts to sell ANL and does it contrast with past efforts to sell ANL?1717Fahey, John, MPMr FAHEYHQ5MacarthurLPFinance and Administration10—I thank the honourable member for Fairfax for his question. I can inform the House that the sale of ANL, the Australian National Line, is almost complete. The government has completed the sale of the liner shipping business to CGM, a French based international shipping company, for approximately $10 million. In addition to that $10 million, CGM has taken over the net financing obligations of the Commonwealth of about $50 million. In addition, all of the Australian National Line liner employees have agreed to accept offers of employment from CGM. The sale of this business has significantly reduced the exposure of taxpayers to the business losses that have arisen over a number of years; that is, the operations of Australian National Line. In addition, we have provided a commercial future for the business as part of this international operation. Only this week I received a letter from CGM indicating that they were looking forward to developing their presence in the Australasian market.The rest of ANL will, I am confident, be disposed of in the near future. The government determined, after a very significant scoping study, to sell the business in part. The negotiations with the preferred purchaser in respect of Australian National Line's bulk business are progressing well, as are the negotiations for the land based businesses. They are proceeding in an orderly fashion.To go to the second part of the question—how does this contrast with the attempts that were made previously to dispose of ANL?—this quiet achievement stands in stark contrast to the woeful attempts by the former Labor government to dispose of ANL. It was announced way back in 1991 in the budget when the Labor government said, `We're going to sell the Australian National Line.' We were then treated to daily headlines that centred on the very inept attempts to sell this business. Those headlines related to the concessions that they gave to the union movement and the protection that they built in. Finally, after about four years, it all fizzled out. But I still recall so well the words of the honourable member for Kingsford-Smith, when he said, `It's not a case of selling this business; you couldn't give it away.' What we saw while this went on were accumulated losses to the Australian taxpayers on the balance sheet of ANL since 1991 of $180.5 million. In the last 10 years it has cost the Australian taxpayers around $250 million. We have stemmed the losses; we have received some money for it. It shows how this government is prepared to operate the business of government in a proper fashion in the interests of the taxpayers of Australia, whereas the former Labor government was simply stuck in a hole because they had no capacity to do anything that interfered with their union masters. 17181718Crean, Simon, MPMr CREANDT4HothamALP00—I again direct my question to the Treasurer. I seek clarification of an element of his goods and services tax `10 per cent on almost everything' bill. Treasurer, your tax package bill states that the regulations could require that the amount of GST be separately disclosed on invoices. Will the regulations require that the GST component be separately shown and, if so, why won't you also require it on receipts?1718Costello, Peter, MPMr COSTELLOCT4HigginsLPTreasurer10—The member for Hotham will be enlightened when he sees the regulation, and I ask him to remain calm until that point.17181718Thompson, Cameron, MPMr CAMERON THOMPSON84CBlairLP10—I address my question to the Minister for Health and Aged Care. Given concern about and support for private health care in the electorate of Blair, I ask: is the minister aware of comments to the effect that private health insurance premiums would have to be reduced by 30 per cent to attract new members? Would the minister advise the House of the nature of these comments, and what is the minister's response to them?1718Wooldridge, Dr Michael, MPDr WOOLDRIDGE8E4ChisholmLPHealth and Aged Care10—I thank the honourable member for his question. There has been support for the government's proposals from some funny quarters, ranging from Bob Carr to Peter Beattie to Graham Richardson. But I have to say probably the strangest support for what the government is doing was recently drawn to my attention. I have a press release here that states:Health economists have proved that, to attract new members, premiums would have to be reduced by 30 per cent.That press release dated February 1996 came from the then Minister for Human Services and Health, Dr Carmen Lawrence.Government members interjecting—10000SPEAKERMr SPEAKER—Order! Members on my right. The minister has the call.8E4Dr WOOLDRIDGE—Clearly, when they were in government they understood what needed to be done to help private health insurance, but now they are in opposition they are prepared to say something totally different.Government members interjecting—10000SPEAKERMr SPEAKER—Members on my right are not helping the minister.8E4Dr WOOLDRIDGE—This just highlights the fact that what is happening with the Labor Party is that they are being carping, negative and opportunistic. They do not understand health and, if you do not understand health, you can't fix it.17181718Beazley, Kim, MPMr BEAZLEYPE4BrandALP00—My question is to the Minister for Sport and Tourism. Minister, when did you become aware of the matters concerning the Cricket Board's handling of the issue of payments from a bookmaker to two Australian cricketers? Have you or your office raised the matter with the board or discussed it with them? If so, what was the content of such discussions? If not, do you intend discussions?1718Kelly, Jackie, MPMiss JACKIE KELLYGK6LindsayLPSport and Tourism; Minister Assisting the Prime Minister for the Sydney 2000 Games10—I was as surprised as anyone in Australia today to learn about the allegations in the media. I think it has led to significant disillusionment with two Aussie icons. I think it sends a message to all Australian sportsmen that they are the flagship of Australia's reputation, Australia's hopes, and that they are role models for many young kids in Australia who play sport and look up to people such as those mentioned in the newspapers today.17181718Bartlett, Kerry, MPMr BARTLETT0K6MacquarieLP10—My question is addressed to the Minister for Education, Training and Youth Affairs. Minister, what effect will the government's tax reforms have on the cost to parents of education? What is the impact of the current wholesale sales tax on the cost of education?1718Kemp, Dr David, MPDr KEMPBT4GoldsteinLPEducation, Training and Youth Affairs; Minister Assisting the Prime Minister for the Public Service10—The government's new tax system will make education more affordable for parents and more accessible to children around Australia. Under the government's new tax system education will be GST free and current taxes which are pushing up the cost of education will be abolished. One of the effects of this new tax system will be to reduce the costs of delivering schooling by some $240 million a year. This will come about because the government will be abolishing the tax system favoured by the Labor Party, the wholesale sales tax. Labor's wholesale sales tax is adding some $240 million a year to the cost of education. Over a period of four years, almost $1 billion has been taken out of the schools to fund Labor's wholesale sales tax. One of the most positive effects of the government's tax reform will be to reduce this $1 billion impost on schools by removing the tax system which Labor favours.In addition, the government will also be reducing personal income tax. The average family with children will be some $40 to $50 per week better off. Day by day, Labor's tax is imposing additional costs on everyday items which parents have to buy to support the education of their children. Labor's 22 per cent wholesale sales tax is putting up the price of A4 paper, exercise books, notebooks, pens and pencils, rulers, erasers, calculators and backpacks. The price of every one of these items has increased as a result of Labor's taxes. The government's new tax system will remove this tax burden from Australian families.One of the biggest challenges for families today in financing education is the cost of computers. As Australia moves into the information age and schools and parents are increasingly seeking to give their children these vital skills, Labor wants to put up the cost of computers. Labor has a 22 per cent wholesale sales tax on computers. The government will be reducing the cost of computers.DT4CREANMr Crean—What about tuition?BT4Dr KEMP—Tuition provided by schools as part of the curriculum will also be GST free and the price will come down. It is time for the Leader of the Opposition to face up to the fact that Labor is 10 years and more behind in its thinking on Australia's tax system, and the Leader of the Opposition knows that. As the member for Werriwa informed us in the 7.30 Report on 20 October this year, in April 1996 Kim Beazley said to him that `Australian Labor had fallen 10 years behind compa rable parties in our policy development and ideas'. The member for Werriwa went on to say, `If that was the case then, we have probably got as much ground to make up now.'It is time for Labor to face up to the fact that its tax system is pricing education up and up. Education will be more accessible and affordable under the government's new tax system.17191719Smith, Stephen, MPMr STEPHEN SMITH5V5PerthALP00—My question is directed to the Minister representing the Minister for Communications, the Information Economy and the Arts. Has the minister seen the Australian Communications Authority telecommunications performance report which expresses concern at a decline in service levels in the country and shows that it takes Telstra an average of 27 hours to clear a pay phone fault in metropolitan areas but an average of 54 hours in country areas? Given that in response to the last set of poor figures in March this year your predecessor told the House, `Rest assured, we are addressing the issue,' what action is the minister taking to address this issue, other than flogging off all of Telstra which will make things worse for regional Australia?1719McGauran, Peter, MPMr McGAURANXH4GippslandNPArts and the Centenary of Federation10—I thank the honourable member for his question. I have noted the report by the ACA as it was tabled yesterday. The member fundamentally misunderstands the report because it is a compilation of the various data released through the year. The government has already responded to the matters raised in the report.DT4CREANMr Crean—What have you done? What have you done?XH4Mr McGAURAN—For instance, in January we introduced the customer service guarantee—10000SPEAKERMr SPEAKER—The minister will resume his seat. The chair has exercised a great deal of tolerance and has, on a number of occasions, asked the member for Hotham to respect the fact that ministers are entitled to be heard in silence. The member for Hotham has ignored that warning.XH4Mr McGAURAN—We have acted on the issues brought forward by the ACA throughout the year. As I said, on 1 January we introduced the customer service scheme so that customers will be compensated if performance falls below certain minimum standards. Secondly, from 1 August the government introduced the penalty to $40 a day if Telstra failed to improve its service levels. Moreover, the minister advises me that he is looking at ways to tighten even further, following on from the report of the ACA, the customer service guarantee. And remember also that the government has said that we are not going to agree to any further sale of Telstra beyond 49.9 per cent until the independent inquiry assesses Telstra service levels as adequate in country areas as well as in metropolitan areas.I point out that another part of our response throughout the year has been to introduce legislation giving the ACA power to direct Telstra to take action to correct systematic failures and faults in regard to provision of performance services or face the fine of up to $10 million—all requirements on Telstra that the previous Labor government never introduced.17201720Gash, Joanna, MPMrs GASHAK6GilmoreLP10—My question is addressed to the Minister for Aged Care. Is the minister aware of a report from the Australian National Audit Office on the planning of aged care? What conclusions does the report draw on the history of aged care planning over the past 10 years?1720Bishop, Bronwyn, MPMrs BRONWYN BISHOPSE4MackellarLPAged Care10—I thank the member for her question, because I am aware of the concern she has for aged care within her own electorate. Very simply, this report of the Auditor-General's Office entitled The planning of aged care drew on 10 years of experience under the Labor Party from 1986 through to 1996. It showed very simply that we had inherited a lousy Labor legacy. It showed that they set a target of having 100 aged care places per 1000 people over the age of 70 years. In 1986 at the time they set the targets it was at 98.3. By 1996 they had dropped it to 93.4. That meant that we were 10,000 places short. In other words, they had dropped funding over that period by $1.5 billion. We are yet again in the position of having to fix up that lousy legacy. By the year 2000, we will have reached that target.PE4BEAZLEYMr Beazley—Have you changed the formula?SE4Mrs BRONWYN BISHOP—By the year 2002, we will have 103 places per 1000. By the year 2001 we will have 100. Just so the Leader of the Opposition can understand, here is a graph.Opposition members interjecting—10000SPEAKERMr SPEAKER—Order! Members on my left!4I4McLEAYMr Leo McLeay—You have it upside down.7T4CROSIOMrs Crosio—Can I show you mine?PE4BEAZLEYMr Beazley—Mr Speaker—10000SPEAKERMr SPEAKER—The Leader of the Opposition does not have the call. The Leader of the Opposition will be the next person to get the call but he will get it when I can hear him.A government member interjecting—10000SPEAKERMr SPEAKER—If that was the member for Forrest, he can consider himself warned.PE4BEAZLEYMr Beazley—I raise a point of order, Mr Speaker. While I appreciate that the graph represents what you have to pay now, previous Speakers have ruled it disorderly to hold up those graphs at the table.10000SPEAKERMr SPEAKER—I understand. In fact, there was a great deal of disruption, as members on my left are well aware, and I did not in fact interrupt the minister until the Leader of the Opposition raised this point of order over the minister's display of a particular chart. I have seen charts used before. I ask the minister to desist from using it and to return to the question.SE4Mrs BRONWYN BISHOP—Thank you very much, Mr Speaker. I only prepared the chart because I know that those on the other side have a great deal of difficulty grasping concepts. On that basis, I would like to table it.Opposition members interjecting—10000SPEAKERMr SPEAKER—I had resolved today not to rise in my seat, assuming that it would not be necessary. Would members on my left please desist. The minister has the call and is entitled to be heard in silence.SE4Mrs BRONWYN BISHOP—Thank you, Mr Speaker. I simply conclude by saying that we inherited a lousy Labor legacy and, as usual, we are fixing it up. I table the graph so that it may be incorporated in Hansard .17211721McMullan, Bob, MPMr McMULLAN5I4CanberraALP00—My question is to the Minister representing the Minister for Industry, Science and Resources. Minister, do you recall being asked on 25 September—during the election campaign—whether you had failed in your promise to create 200,000 new manufacturing jobs in your first term of government, and correcting the interviewer:It was never in terms of the first term, but by the year 2000?Given that it was during the election campaign that you reaffirmed that target, do you now agree with Senator Minchin's decision—just three months later—to dump it?1721Moore, John, MPMr MOOREEI4RyanLPDefence10—The member should know that with the growth in the economy of five per cent in the last quarter 390,000 jobs have been created in Australia since the 1996 election—90,000 in the last three months. We have record low interest rates, record low inflation—a magnificent job has been done by the government in managing the economy. This is widely acknowledged by the business community. It is widely acknowledged by the manufacturing sector and by the commerce area as a whole. In relation to the employment record of the government of 390,000 jobs since the 1996 election, we stand on our record.17211721Moylan, Judi, MPMrs MOYLAN4V5PearceLP10—My question is to the Minister for Health and Aged Care. Can the minister inform the House of recent reports about the survival rate of women who have been diagnosed with breast and cervical cancer?1721Wooldridge, Dr Michael, MPDr WOOLDRIDGE8E4ChisholmLPHealth and Aged Care10—I thank the honourable member for her question and for her interest in this area. Last week I launched two reports from the Australian Institute of Health and Welfare. There was the first ever report on breast and cervical cancer screening over 1996-97 and on breast cancer survival over the period 1982 to 1994.I will take the cancers separately. Breast cancer is clearly an important cancer. One in eleven women will have breast cancer during their lifetime. Some 1.3 million Australian women were screened for breast cancer over a 12-month period. This picked up a large number of small cancers. About one in 700 women who were screened in the target group—which is 50 to 69 years—actually had a small cancer picked up.The survival rate from breast cancer is good. Over 90 per cent of women are alive two years later. If you look at the period 1983 to 1990, the survival rate from breast cancer is going up. If you were diagnosed with breast cancer in 1983, your chance of surviving for five years was 74 per cent. In 1990, if you were diagnosed with breast cancer, your chance of survival had gone up to 79 per cent—a five per cent improvement. The chances of survival for a woman who was diagnosed with breast cancer today would almost certainly be much higher than 79 per cent. The exact figure will take five years to know.This puts us in a very good position internationally. Our survival rate for breast cancer for women is higher than in countries such as England, the Netherlands and Spain. It is comparable with or better than in most Scandinavian countries. One country that does do better than us is the USA, but that is only for white women—the survival rate for black women is substantially below ours. Our survival rate gives a very great reason to hope.Cervical cancer is the other cancer examined. This is one of the few cancers that can be picked up at a precancerous stage. The number of women screened over a two-year period was 2.6 million—a massive effort around Australia. Over the period 1982 to 1994, there has been a very dramatic decrease in the incidence of cancer of the cervix. It has gone down 36 per cent. At the same time, the number of precancerous legions being picked up has gone up dramatically. The simple fact is that we have reduced mortality from cancer of the cervix in Australia by 40 per cent over that period. Again, that is something the country can be very proud of. Obviously, there is a lot more to do, but it shows that, with cancers such as this, concerted national effort can make a very great difference. It also shows the need to take a very long-term approach in health because these successes have taken 15 years to achieve.17221722Fitzgibbon, Joel, MPMr FITZGIBBON8K6HunterALP00—My question is to the Minister for Employment, Workplace Relations and Small Business. Is the minister aware of the following comments in yesterday's Australian Financial Review with respect to the $500 million small to medium enterprise GST `compensation fund'? It says:There are issues for small business like updating and upgrading accounting systems, training staff, changing stationery and planning whether you will be better or worse off in terms of cash flow. All those involve time and cost.SE4BISHOPMrs Bronwyn Bishop—You have to be able to read better than that.10000SPEAKERMr SPEAKER—The Minister for Aged Care!SE4BISHOPMrs Bronwyn Bishop—He has no flow.10000SPEAKERMr SPEAKER—The Minister for Aged Care!8K6Mr FITZGIBBON—It continues:The $500 set aside for each small business's establishment cost is an unrealistic figure."0V5SLIPPERMr Slipper—Who wrote it? Who wrote it?10000SPEAKERMr SPEAKER—I warn the member for Fisher.8K6Mr FITZGIBBON—The quote was from Mr Ken Traill, the principal consultant on tax reform at the Institute of Chartered Accountants. It appeared in yesterday's Australian Financial Review , as I said. In light of these criticisms on the impact of a GST on small business, will you be increasing the size of the fund?1722Reith, Peter, MPMr REITHWI4FlindersLPWorkplace Relations and Small Business10—In response to this very sophisticated question from the shadow minister for small business, I inform him that the small business community reckons that fixing up the tax system is one of the most important things we can do. In all the surveys—the one during the election, for example—they were asked to nominate the most important issues—8K6FITZGIBBONMr Fitzgibbon—Mr Speaker, I rise on a point of order which goes to relevance. I asked a very specific question about the size of the compensation fund, which is grossly inadequate.10000SPEAKERMr SPEAKER—The member for Hunter will resume his seat. The minister has had, in fact, 23 seconds on his feet.WI4Mr REITH—A few more seconds will do to dispose of the question, Mr Speaker. The fact is that small business reckons it is a great idea. We have announced a small business consultative committee which will be working with the government to ensure that we have the best possible system for small business.ET4BEVISMr Bevis—How many jobs in this one—50,000?WI4Mr REITH—How many jobs are there in this? The new tax system is very good for jobs. That is why we are in favour of it, and that is why you are against it.17221722Secker, Patrick, MPMr SECKER848BarkerLP10—My question is addressed to the Minister representing the Minister for Family and Community Services. Could the minister outline to the House how the Retirement Assistance for Farmers scheme is helping rural and regional Australia and indicate how many people have taken advantage of this coalition initiative?1722Truss, Warren, MPMr TRUSSGT4Wide BayNPAgriculture, Fisheries and Forestry10—I thank the member for Barker for the question. This question refers to the government's farmers retirement assistance scheme which, for the first time, addresses the issues of intergenerational farm transfer—something which Labor did nothing about. The legacy that Labor left this government in primary industry has made this scheme very important. Under this scheme, farmers are able to retire, transfer their property to a succeeding generation and be given special concessions under the assets and income test to be eligible for the pension. That has meant that a significant number of farmers have been able to pass their farms on to the succeeding generation so that the property can continue to be worked in a productive way while they enjoy a normal and happy retirement.I am happy to be able to report in response to the honourable member's question that, to date, some 210 customers have successfully applied under this scheme and are now receiving either an increased pension or a full pension that they would not have been eligible for had it not been for this government initiative. The department has currently received about 550 applications, and so there has obviously been a very warm response to the scheme in the rural community. It is already providing very real benefits to farm families.For the information of the honourable member for Barker, I am sure he would be pleased to know that there are some seven successful applicants from his electorate. That demonstrates that this scheme is working in his part of Australia, as it is in many rural parts of Australia. This has been an outstanding initiative by the government and it is going to have real rewards for the Australian farming community.17231723Lee, Michael, MPMr LEEMG4DobellALP00—My question is to the Minister for Education, Training and Youth Affairs. Is the minister aware of the Vos report finding that `the education sector will experience additional costs associated with the implementation of the GST and there will be additional compliance costs'? Minister, isn't it correct that the $500 million compensation fund is not limited only to Australia's one million small businesses but will now be stretched to cover every hospital, charity and religious organisation, as well as every school, university and TAFE, that registers for the GST? How can you claim that a one-off payment of less than $500 could possibly be enough to compensate a school or a university for all of the administrative changes, computer software upgrades and staff training required to implement your 10 per cent GST?Opposition members interjecting—10000SPEAKERMr SPEAKER—The minister had not even commenced his reply before I could scarcely hear anything above the noise from the opposition front bench. If the Minister for Foreign Affairs is similarly guilty, I will include him in the warning.1723Kemp, Dr David, MPDr KEMPBT4GoldsteinLPEducation, Training and Youth Affairs; Minister Assisting the Prime Minister for the Public Service10—The member for Dobell clearly does not listen. He is the authentic spokesman for the intellectual vacuum which exists in the Labor Party on education policy. I have already had the opportunity to explain to the House that the effect of the government's new tax system will in fact be to reduce costs to schools. Schools will have more resources available to them because we will not be ripping out of schools the billion dollars in wholesale sales tax costs that are indirectly flowing through into schools at present under the tax system favoured by the Labor Party.PE4BEAZLEYMr Beazley—I raise a point of order, Mr Speaker. It is on relevance. The minister for education knows very well that wholesale sales tax is not levied on schools and they do not have to account for it in their accountancy processes, but they will with this. He has been asked a straightforward question as to what the impact of that $500 million is supposed to be across the board, and he is not answering.10000SPEAKERMr SPEAKER—The Leader of the Opposition has made his point on relevance. I noted the question while it was being asked, and in fact the question was asked about a range of institutions, including hospitals and other institutions as well as schools, about compliance costs. The minister has had a little over 30 seconds in which to be relevant, so I scarcely felt it fair to deem his answer irrelevant.BT4Dr KEMP—We are now seeing that the Labor Party's attack on the government's new tax system is based on a complete ignorance of how the wholesale sales tax system which they support applies. Schools have to claim exemption from wholesale sales tax. Wholesale sales tax cascades through into the costs of items which schools pay for. The abolition of the wholesale sales tax is one of the major reasons why schools will save some $240 million. The Leader of the Opposition does not like to hear this, but over a four-year period the effect of that additional cost on schools resulting from Labor's wholesale sales tax system is an additional $1 billion worth of costs on schools; just under one billion dollars worth.PE4BEAZLEYMr Beazley—I raise a point of order, Mr Speaker. Again it is on relevance. The government's own Vos committee has pointed out that compliance costs will rise. We asked a question as to whether or not the $500 million across just about everybody will suffice.10000SPEAKERMr SPEAKER—The Leader of the Opposition can draw my attention to relevance but he cannot enter into the debate, as he well knows.PE4BEAZLEYMr Beazley—I am not entering into the debate, Mr Speaker. I am pointing out where it is irrelevant.10000SPEAKERMr SPEAKER—I call the minister, and I am listening to his answer.BT4Dr KEMP—The Leader of the Opposition is once again demonstrating that he does not understand the significance of that report. There is a distinction between net and gross costs. The total cost to schools, as estimated by the Treasury, from the implementation of the new tax system is a decline in costs of $240 million—PE4BEAZLEYMr Beazley—I have a point of order, Mr Speaker.10000SPEAKERMr SPEAKER—The minister will resume his seat.1724Kemp, Dr David, MPDr KEMPBT4GoldsteinLPEducation, Training and Youth Affairs; Minister Assisting the Prime Minister for the Public Service10—And that is basically because we are getting rid of the unfair wholesale sales tax system which is supported by the Labor Party.10000SPEAKERMr SPEAKER—The minister will resume his seat.MG4LEEMr Lee—He defied your ruling, Mr Speaker.10000SPEAKERMr SPEAKER—The member for Dobell will remain in his seat until I have heard the Leader of the Opposition's point of order.PE4BEAZLEYMr Beazley—The point of order is on relevance. The question goes specifically to the question of compliance costs. He did not deal with that for one word in the entirety of the remarks he made.10000SPEAKERMr SPEAKER—The minister answered the question relative to relevant tax costs on schools, as I understood it.17241724Schultz, Alby, MPMr SCHULTZ83QHumeLP10—My question is to the Minister for Education, Training and Youth Affairs. Given the recent seizures of large quantities of drugs across Australia, could the minister outline for the House what measures the government is taking to reduce the use and availability of drugs in our schools?1724Kemp, Dr David, MPDr KEMPBT4GoldsteinLPEducation, Training and Youth Affairs; Minister Assisting the Prime Minister for the Public Service10—I thank the member for Hume for his question. I think one of the worst fears that any parent has is that their child will become involved with illegal drugs. Schools need to be places where pupils are safe and where parents can have confidence that their children will be learning about the dangers of drugs and will not be exposed to drugs. As part of its national drug strategy, the government has set a goal that there should be no illegal drugs at all in schools. This goal has been endorsed by all the states and territories.I am proud to say that this week the government has launched its draft national school drugs education strategy. We have allocated some $17.5 million to the implementation of the strategy over the next four years. This strategy document has been distributed to a wide range of organisations and interested parties, including the state and territory governments and school and parent organisations.83REDWARDSMr Edwards—Why are you closing submissions on 12 February? Why are you closing submissions so early?10000SPEAKERMr SPEAKER—The member for Cowan will cease interjecting.BT4Dr KEMP—The members of the opposition are not interested in protecting young people in schools against drugs. It is clear that they are not interested in contributing to the development of the national school education drug strategy.I would like to take this opportunity to thank the members of the National Advisory Committee on Drug Education for the contribution that they have made to the development of this strategy. The government recog nises that drugs in schools can only be tackled effectively with the support of the whole community. This drug strategy is designed to assist—83REDWARDSMr Edwards—You are not giving parents a choice. Give the parents and schools a go.10000SPEAKERMr SPEAKER—The member for Cowan knows that he is blatantly ignoring the chair—after I had drawn his attention to the fact that he needed to exercise just a little more discretion.QI4PRICEMr Price—He has not answered the question.BV5ADAMSMr Adams—That is right.10000SPEAKERMr SPEAKER—The member for Chifley and the member for Lyons are both warned.BT4Dr KEMP—The government recognises that community support for schools is going to be vital to the success of this drug strategy. I invite all interested members of the community to access the draft national school drug strategy on the Internet at the department's site and to make their contributions to the consultations on this strategy.The national school drug strategy is about more than teaching our young children to say no to drugs. It is about teaching young people to know and understand why saying no is much better and healthier for them than saying yes.17251725Cameron, Ross, MPMr ROSS CAMERON3K6ParramattaLP10—My question—UNKNOWNOpposition membersOpposition members— Oh, Mr Speaker.10000SPEAKERMr SPEAKER—I beg your pardon. I gave that call in error. I concede that.3K6Mr ROSS CAMERON—They are just a bit slow on the other side.Opposition members interjecting—10000SPEAKERMr SPEAKER—The member for Parramatta runs the very real risk of not even being recognised. I will allow his call and allow two calls then to the members of the opposition.3K6Mr ROSS CAMERON—Thank you for your generosity, Mr Speaker. My question is to the Minister for Community Services. I note with interest the recent publication by the Commonwealth of tenders for enhanced welfare fraud investigation services. Could the minister outline to the House the need for such services and the benefits they will involve for honest Australian taxpayers?1725Truss, Warren, MPMr TRUSSGT4Wide BayNPAgriculture, Fisheries and Forestry10—I thank the honourable member for Parramatta for the interest he has taken in this issue. This government has no sympathy whatever for welfare cheats. Australians do not mind paying taxes to support the needs of those people in our community who need genuine help, but they resent working hard to fund the lifestyles of rorters and cheats and this government is determined to stamp out any illegitimate activity.The facts are that the vast majority of Centrelink's six million customers receive their benefits properly and in order, but there is a small group of people who are deliberately rorting the system and additional measures need to be taken to help stamp out that kind of behaviour.Over the last few months the government has been conducting a trial in Sydney and on the Gold Coast using private investigative companies to assist in identifying and accumulating evidence against suspected cases. That trial has been very successful. Of 53 cases referred to private investigators, a total of 33 have led to benefits being cancelled or reduced. In fact, something like $440,000 worth of debts will be recovered as a result of this activity.On the basis of that success the government has decided to extend this activity and has indeed called tenders inviting private surveillance companies to offer these sorts of services in the community.QJ4THEOPHANOUSDr Theophanous—Mr Speaker, I raise a point of order. This is clearly an announcement of a serious policy that needs to be discussed in this House, and is therefore not appropriate as an answer to a question. It should be announced as a policy in this House.10000SPEAKERMr SPEAKER—I did not consider anything that the minister had said resembled the announcement of a policy, as such. In fact, had he done so I would have sat him down.GT4Mr TRUSS—Of course it is not an announcement of policy. These advertisements were in the paper last week. If you read the newspapers you would not be so far behind.It is anticipated that these companies will be particularly involved in cases where, for example, people who claim to have a disability and who are receiving a disability pension are keeping down jobs in the work force, or where people are perhaps employed but claiming to be unemployed. There may be other examples where perhaps they pay cash in hand—QJ4THEOPHANOUSDr Theophanous—Mr Speaker, I raise a point of order. With respect, the minister is announcing a policy and under the guidelines for policy announcement this is not appropriate for question time.10000SPEAKERMr SPEAKER—I want to reassure the member for Calwell and all members of the House that I agree that policy ought not to be announced during question time. I do not consider what the minister is doing in any way resembles the announcement of policy as is normally announced by ministerial statement in the House.GT4Mr TRUSS—Mr Speaker, I know the opposition is being sensitive about this matter because we are cleaning up another Labor mess. The situation is that the vast majority of pensioners and beneficiaries receive their benefits and the benefits that they are entitled to. They have nothing to fear from this kind of surveillance. In fact, Centrelink will always use data matching and a whole range of other options before engaging private surveillance companies. But there will be a small number of cases where we believe this mechanism will be helpful in delivering real benefits to taxpayers and in clearing any slur on legitimate welfare beneficiaries by those who are cheating on the system.17261726Kernot, Cheryl, MPMs KERNOTXW4DicksonALP00—My question is to the Minister for Transport and Regional Services. Can the minister confirm reports that CASA cancelled its meeting with pilots of the New South Wales Air Ambulance Service and that that service will now go ahead and cancel all but emergency flights into the new class G airspace? Is the minister aware of yesterday's call by the Australian Federation of Airline Pilots for the class G trial to be suspended because of ongoing safety concerns, including reports of three near misses in the trial airspace? Given these latest developments, what steps has the minister taken to satisfy himself, independently of advice from CASA, that aviation safety is not being jeopardised by the class G airspace trial?Opposition members interjecting—10000SPEAKERMr SPEAKER—The honourable members for Dobell, Batman and Brisbane!83YHOAREMs Hoare—This is about air safety.10000SPEAKERMr SPEAKER—The honourable member for Charlton is a new member who knows better than she does. I will not tolerate another interjection.1726Anderson, John, MPMr ANDERSON4K4GwydirNPDeputy Prime Minister10—I thank the honourable member for his question. The House will recall that on Monday in this place I tabled a letter from the Director of Aviation Safety, Mick Toller, which concluded that in the event that any genuine safety concerns were identified either by CASA or by BASI the demonstration of the class G airspace would cease.The Bureau of Air Safety Investigation has been carrying out a systematic investigation of this demonstration as part of its normal safety functions. I can inform the House that the bureau is, in fact, releasing its interim recommendations today. This goes to the heart of the question that the member has asked about further steps taken by me, or further advice from independent sources that might be made available to allow the assessment of the safety of the trials and so forth; there it is, it will be released later today.I can tell the House, too, that the bureau has concluded that the demonstration has served its purpose and that it should now be subjected to a comprehensive evaluation. BASI has identified a number of safety issues that need to be addressed. As a result, Mr Toller advised me yesterday afternoon that the demonstration will now end.5T4BRERETONMr Brereton—Ha, ha!4K4Mr ANDERSON—I hear with enormous interest that the man who set up the statutory authority to distance himself, appropriately, from management of air safety now, by his laughter, makes a claim that he considers himself a greater expert on aviation safety in Australia than CASA. That might have been the case, given the way that he set the model up and the people that he put in control of it; but after we fixed it up and ensured that there was appropriate expertise there, I have to inform the member for Kingsford-Smith that I have a lot more confidence in the board of CASA to manage aviation safety in Australia than he does—a lot more—and I would suggest that the Australian people do as well.Having said that, BASI has also recommended—Mr Speaker, I assume that those opposite are actually interested in air safety, not simply in politicisation of the issue.CT4COSTELLOMr Costello—No, I wouldn't assume that.4K4Mr ANDERSON—No. the evidence of the last few days is that they are more interested in the politics. But this is pretty important stuff. BASI has also recommended that CASA, Airservices Australia and the department of transport should review their roles and responsibilities in airspace regulation and management. My role, of course, in all of this is to oversee governments. I have directed the head of my department, Dr Allan Hawke, to conduct the review and report back to me by Tuesday, 22 December. He is to work closely with Mr Toller and the Chief Executive Officer of Airservices Australia, Mr Pollard. So the correct approach to this matter has been taken.PE4BEAZLEYMr Beazley—But not by you!4K4Mr ANDERSON—By me. And that has been to allow the government's air safety experts to do their job without political interference. Mr Speaker, it is perfectly obvious that we can assume from those opposite that they have now actually redefined their policy in a given area. They have got a new policy. They are going to take over responsibility for aviation safety again—having set up the statutory authority to look after it. They are exposed, it is as simple as that, because I have actually followed the model laid down by the member for Kingsford-Smith. This is the only way that Australians can be sure that air safety decisions will be based on genuine safety concerns other than political or industrial relations considerations. It may not be the most politically expedient approach, but it is the right approach.17271727McMullan, Bob, MPMr McMULLAN5I4CanberraALP00—My question is to the Treasurer. Is the Treasurer aware that certain car lease companies have written to their clients notifying them of significant increases in the cost of leasing a car due to `the transition from the current taxation system to the GST-based system.' In particular, what is the Treasurer's response to Clarence Valley Community Programs, a not-for-profit agency in Grafton, who have just been told by Hertz that an 18-month car lease will cost them $400 instead of $260 because of the GST? What compensation is available to this organisation and thousands of others like it for increased costs from now—November 1998—to July 2000 as a result of this increase in their costs? Or does the Treasurer intend to take any action to stop the car leasing companies from using the GST to increase costs to charitable services, particularly those who rely on cars to service rural and regional communities?1727Costello, Peter, MPMr COSTELLOCT4HigginsLPTreasurer10—This question has previously been asked and the answer has previously been given, but I will give it again. Once you get rid of Labor's wholesale sales tax and you replace it with—5I4McMULLANMr McMullan—This is happening now! Today!10000SPEAKERMr SPEAKER—The member for Fraser, the Treasurer has the call.5I4McMULLANMr McMullan—The costs are going up now.10000SPEAKERMr SPEAKER—The member for Fraser!CT4Mr COSTELLO—Just hold on; just calm yourself down. Once you get rid of Labor's wholesale sales tax—which is 22 per cent on cars, as you know—and you reduce taxes to 10 per cent, you actually make cars cheaper. It is a great thing for the car industry, it is a great thing for not-for-profit organisations and it is a great thing for everybody that buys a car. We on this side of the parliament like cheaper cars.Some of the lease companies say, `If the remainder value of a car is less, then we will put up our lease payments.' That is what they say. Some say it rightly; some say it wrongly. Some are taking the opportunity to put up costs in advance because the car has become cheaper. But, for the not-for-profit organisation, let me explain this point again: costs fall.5I4McMULLANMr McMullan—No, they are going up.CT4Mr COSTELLO—For charities, costs fall.5I4McMULLANMr McMullan—Up to $400 from $260?10000SPEAKERMr SPEAKER—The member for Fraser!CT4Mr COSTELLO—Charities are GST free. That means that charities get back all of the embedded costs.5I4McMULLANMr McMullan—On a point of order, Mr Speaker, on relevance: my question was about—10000SPEAKERMr SPEAKER—The member for Fraser will resume his seat. There is nothing irrelevant about the Treasurer's answer.5I4McMULLANMr McMullan—Would you actually like to hear my point of order before you rule on it?UNKNOWNGovernment membersGovernment members—Oh!10000SPEAKERMr SPEAKER—I want no help from those on my right. The member for Fraser indicated to me that he had a point of order on the basis of relevance.5I4McMULLANMr McMullan—Exactly—would you like to hear what it is?10000SPEAKERMr SPEAKER—I was simply indicating that the Treasurer's answer had been relevant to the question.5I4McMULLANMr McMullan—My question related to what is going to happen over the next 18 months. Everything he has referred to relates to what happens after the next 18 months and cannot be relevant.10000SPEAKERMr SPEAKER—The member for Fraser will resume his seat.5I4McMULLANMr McMullan—It cannot be relevant.10000SPEAKERMr SPEAKER—The member for Fraser will resume his seat. The Treasurer's answer is in order.5I4McMULLANMr McMullan—You are hopeless!CT4Mr COSTELLO—Oh!10000SPEAKERMr SPEAKER—The Treasurer will resume his seat. Was the member for Fraser reflecting on the chair with that statement?5I4McMULLANMr McMullan—I was very angrily responding, and I withdraw.10000SPEAKERMr SPEAKER—Thank you. I call the Treasurer.CT4Mr COSTELLO—I agree with the member for Fraser. Can I say in relation to charities, as I think has been well explained to anybody who has an open mind on the question, that prices for charities fall under the government's new tax system. Isn't that a great thing? The fact is that charities can get back all of the taxes that are currently embedded—PE4BEAZLEYMr Beazley—Mr Speaker, a point of order: look at the question that was asked by the member for Fraser. It may be that you do not recollect what was in it. This goes to relevance. The point is that he asked specifically of the Treasurer:. . . what is the Treasurer's response to Clarence Valley Community Programs, a not-for-profit agency in Grafton, who have just been told by Hertz that an 18-month car lease will cost them $400 instead of $260 because of the GST?What does the Treasurer intend to do:to stop the car leasing companies from using the GST—10000SPEAKERMr SPEAKER—I interrupt the Leader of the Opposition. The Leader of the Opposition does not intend to read the entire question, I trust.PE4BEAZLEYMr Beazley—Not the entire lot. It continues:. . . to increase costs to charitable services, particularly those who rely—desperately—on cars to service rural and regional communities?It is very specific to the one point related to leases and the fact that prices of those leases are rising in advance of a GST coming into place. There is nothing else in the question than that.10000SPEAKERMr SPEAKER—I in fact deem the Treasurer to be entirely relevant to the question, and I invite him to continue his response.CT4Mr COSTELLO—I have dealt with the question of cars. You asked me about charitable services, and the point I am making is this: under the next tax system charities get a better tax deal. They get back all of the embedded wholesale sales taxes that they now pay under Labor, and they do not put any tax on their outputs. Running a charity becomes cheaper. That's great for the charitable sector, it's great for people who get their services, and we do not understand why a Labor Party would not support that.17291729Andrews, Kevin, MPMr ANDREWSHK5MenziesLP10—My question is to the Minister for Foreign Affairs. Can the minister inform the House what the government is doing about proposals for the establishment of an international criminal court? How does this relate to the government's approach to the promotion of human rights more generally?1729Downer, Alexander, MPMr DOWNER4G4MayoLPForeign Affairs10—I thank the honourable member for Menzies for his question. Particularly as a lawyer, he would have a great interest in the whole issue of the international criminal court. I respect the interest that he has shown in those sorts of issues. Tomorrow, as at least some honourable members will probably know, is the 50th anniversary of the Universal Declaration of Human Rights. Appropriately, on the day before the commemoration of the signing of that historic document, the Australian government will sign the Statute of the International Criminal Court at the United Nations in New York tonight, Australian time.The establishment of an international criminal court has been one of the government's key human rights objectives. We have played a very active part in the establishment of that court. In particular, I draw the attention of the House to the fact that it was an Australian official who chaired the so-called like-minded group during the diplomatic conference in Rome earlier this year, who did an outstanding job in helping to bring together some diverse points of view and in the end made it possible for there to be the establishment of an international criminal court. I gave the opening address to that diplomatic conference in Rome on 15 June.UNKNOWNOpposition membersOpposition members—Oh!4G4Mr DOWNER—Members on this side of the House would be aware of that because they follow interesting policy issues; members on the other side are obviously expressing surprise because they have shown not the slightest interest in the international criminal court at all. For example, the member for Kingsford-Smith has asked this year no questions of me on any topic whatsoever, and today is the second last day on which he could ask a question. So here we are in December, and still not a question in 1998 from the member for Kingsford-Smith, which shows what a lazy policy process the Labor Party has.10000SPEAKERMr SPEAKER—The minister will return to the question.4G4Mr DOWNER—We would regard the establishment of the international criminal court as one of the great achievements of this year both for Australia and for other countries. It is appropriate that we should sign the statute itself the day before the anniversary of the signing of the Universal Declaration of Human Rights.In conclusion—because the honourable member asked a question about human rights issues more generally—the Australian government, over the last 2½ years, has made one very significant change to our human rights diplomacy, and that is to focus a great deal more on what is called `institution building'. One of the institutions that we established—and honourable members opposite will not be aware of this—was a centre for democratic institutions. This is one of the ways that we will be able to encourage the spread of good and democratic governance throughout the Asia-Pacific region. There are many other initiatives in the area of institution building that we have pursued, and this government can be proud of what it has achieved in international diplomacy to advance human rights.DG4FISCHERMr Tim Fischer—Mr Speaker, I ask that further questions be placed on the Notice Paper . Miscellaneous1730173015:16:001730Fischer, Tim, MPMr TIM FISCHERDG4FarrerNP10—Mr Speaker, I seek the indulgence of the chair to add to an answer.10000SPEAKERMr SPEAKER—The minister may proceed.DG4Fischer, Tim, MPMr TIM FISCHER—Mr Speaker, I present the following quote to the House:I think it is very unwise to set targets re unemployment that indicate that you achieve satisfaction at a particular point. I think, with the unemployment levels that we are looking at, we have to have an objective to be constantly bringing them down and not set arbitrarily any set of targets.The author of that quote was the Minister for Employment, Education and Training on 11 March 1993—none other than the present Leader of the Opposition. That was his true belief on the matter of targets. I add it to a previous answer.Opposition members interjecting—5I4McMULLANMr McMullan—Mr Speaker, I raise a point of order. Are you ruling that he does not have to identify what question it was, what answer he is adding to, what day he gave it or what it was about? Can he just get up and make any statement he likes, bearing no relationship to any matter before the House?LS4FERGUSONMr Martin Ferguson—Are you still trying to impress the Italian President, you boofhead?DG4Fischer, Tim, MPMr TIM FISCHER—You have not even asked a question today.LS4FERGUSONMr Martin Ferguson—You were puffed up yesterday.10000SPEAKERMr SPEAKER—Members on my left may not have been aware of the fact that the Deputy Prime Minister sought indulgence to add to a previous answer.DT4CREANMr Crean—Which one? He didn't give an answer.10000SPEAKERMr SPEAKER—He sought indulgence to add to a previous answer—Opposition members interjecting—DT4CREANMr Crean—Go on. A previous answer—10000SPEAKERMr SPEAKER—The Leader of the Opposition will resume his seat because I have not completed what I am saying. In fact he might have noticed that I was invited by his deputy leader to, in the deputy leader's terms, `go on'. The Deputy Prime Minister sought leave to add to an answer given by another minister. That is consistent with what has happened in the House in the past and I allowed him to do so.UNKNOWNOpposition membersOpposition members—Which one?PE4BEAZLEYMr Beazley—Mr Speaker, I raise the point of order that it was not a question directed to him and it was not a question identified in the answer he gave, so nobody on this side of the House understood where he was coming from as far as that was concerned. Every conceivable set of standing orders that apply in relation to seeking your indulgence in that regard was breached. He is not the Prime Minister as far as adding to answers is concerned, even for the purposes of question time today. As it turns out, it seems to have been related to an answer that the Minister for Defence gave, but you would not have known that from the way it was handled or identified to you in the first place. It ought to have been given by the Minister for Defence, as he had dealt with the question.10000SPEAKERMr SPEAKER—The ruling given by the chair was entirely consistent with rulings given by the chair on previous occasions. Is the Deputy Prime Minister seeking the call?DG4Fischer, Tim, MPMr TIM FISCHER—I wish to confirm that it was in respect of the question asked of the Minister for Defence.7T4CROSIOMrs Crosio—Now you tell us!Personal Explanations173015:20:001730Gallus, Christine, MPMrs GALLUSCU4HindmarshLP10—Mr Speaker, I wish to make a personal explanation.10000SPEAKERMr SPEAKER—Does the honourable member claim to have been misrepresented?CU4Gallus, Christine, MPMrs GALLUS—Yes.10000SPEAKERMr SPEAKER—Please proceed.CU4Gallus, Christine, MPMrs GALLUS—In the Brisbane Courier-Mail on 8 December, Matthew Horan said, in an article entitled `Fewer checks on MP travel claims despite the rorts':South Australian Liberal Chris Gallus was last year forced to repay $1745 for 12 wrongly claimed nights . . .Anyone reading this article would get the clear impression that I benefited by $1,745 from false claims before I was forced to repay this amount. The records indicate that the total discrepancy between what I repaid and what I was owed from underclaims was $50—in my favour. My staff discovered many of the errors when they did an audit of office procedures. On some occasions, we had failed to claim travel allowance that was due to me or that was less than what I was entitled to. On other occasions, we had claimed allowance I was not entitled to because travel plans had been altered and not been recorded in the office diary. The largest amount was a claim for a parliamentary sitting when in fact I was in Africa on a delegation.In a letter to the Adelaide Advertiser published on 1 June this year I stated that I had repaid overclaimed allowance to a net total of $140. Today I rechecked the records with Corporate Services. Taking into account all under- and overclaims processed for the period up to 31 December 1997, the records indicate that the discrepancy between my overclaims and underclaims was $50 owed to me.Documents17311731Reith, Peter, MPMr REITHWI4FlindersLPWorkplace Relations and Small Business10—Papers are tabled as listed in the schedule circulated to honourable members. Details of the papers will be recorded in the Votes and Proceedings and Hansard .The schedule read as follows—Anglo-Australian Telescope Agreement Act—Anglo-Australian Telescope Board—Report for 1997-98Australian Securities and Investments Commission Act—Australian Accounting Standards Board—Report for 1997-98.Companies and Securities Advisory Committee—Report for 1997-98.Corporations and Securities Panel—Report for 1997-98.Commonwealth Authorities and Companies Act— Australian Law Reform Commission—Report for 1997-98.Department of Defence—Special purpose flights—Schedule for period January to July 1998—Erratum.Employment, Education and Training Act— National Board of Employment, Education and Training—Australian Research Council and Higher Education Council—Report for 1997-98.International Labour Organisation—Australia's submission report on International Labour Organisation (ILO) maritime instruments adopted in 1996.Conventions—No. 178—Inspection of seafarers' working and living conditions.No. 179—Recruitment and placement of seafarers.No. 180—Seafarers' hours of work and the manning of ships.Protocol of 1996 to the Merchant Shipping (Minimum Standards) Convention 1976.Recommendations—No. 185—The inspection of seafarers' working and living conditions.No. 186—Recruitment and placement of seafarers.No. 187—Seafarers' wages and hours of work and the manning of ships.Landcare Australia Limited—9th report, for 1997-98.Murray-Darling Basin Act—Murray-Darling Basin Commission—Report for 1997-98.National Residue Survey Administration Act—National Residue Survey—Report for 1997-98.Telecommunications Act 1997—Digital data inquiry—Ministerial statement by the Minister for Communications, Information Technology and the Arts (Senator Alston), December 1998.Report, August 1998.Motion (by Mr Reith) proposed:That the House take note of the following papers:Australian Securities and Investments Commission Act.Companies and Securities Advisory Committee—Report for 1997-98.Corporations and Securities Panel—Report for 1997-98.Australian Accounting Standards Board—Report for 1997-98. Debate (on motion by Mr McMullan) adjourned.Committees173217321732Mr SPEAKERMr SPEAKER10000PON/A10—I present a schedule showing the allocation of annual reports of departments, agencies, authorities and companies to general purpose standing committees and certain joint committees. A copy of the schedule will be incorporated in Hansard .The schedule read as follows—39th PARLIAMENTSpeaker's ScheduleAllocation to Committees of Annual Reports of Departments, Agencies, Authorities and CompaniesStanding Committee on Aboriginal and Torres Strait Islander AffairsAgriculture, Fisheries and Forestry PortfolioTorres Strait Protected Zone Joint Authority** Referred also to the Standing Committee on Primary Industries and Regional ServicesPrime Minister and Cabinet PortfolioDepartment of the Prime Minister and Cabinet*Aboriginal and Torres Strait Islander Commercial Development CorporationAboriginal and Torres Strait Islander CommissionAboriginals Benefit ReserveAboriginal Hostels LtdAboriginal Land Commissioner, Northern TerritoryAnindilyakwa Land CouncilAustralian Institute of Aboriginal and Torres Strait Islander StudiesCentral Land CouncilCouncil for Aboriginal ReconciliationHuman Rights and Equal Opportunity Commission**Indigenous Land Corporation***National Native Title Tribunal***Northern Land CouncilRegistrar of Aboriginal CorporationsTiwi Land CouncilTorres Strait Regional Authority* Referred also to the Standing Committee on Economics, Finance and Public Administration** Referred also to the Standing Committee on Legal and Constitutional Affairs *** Referred also to the Parliamentary Joint Committee on Native Title and the Aboriginal and Torres Strait Islander Land FundStanding Committee on Communications, Transport and the ArtsCommunications, Information Technology and the Arts PortfolioDepartment of Communications, Information Technology and the ArtsAdvisory Council on Australian ArchivesAustralia CouncilAustralian Broadcasting AuthorityAustralian Broadcasting CorporationAustralian Communications AuthorityAustralian Film CommissionAustralian Film Finance CorporationAustralian Film, Television and Radio SchoolAustralian National Maritime MuseumAustralian Postal CorporationCompetitive Safeguards and Carrier Performance (ACCC)Film Australia LimitedNational Archives of AustraliaNational Film and Sound ArchiveNational Gallery of AustraliaNational Library of AustraliaNational Museum of AustraliaNational Science and Technology CentrePublic Lending Right CommitteeSpecial Broadcasting Service CorporationTelstra Corporation LimitedTransport and Regional Services PortfolioDepartment of Transport and Regional Services*Airservices AustraliaANL LimitedAustralian Maritime Safety Authority**Australian Land Transport Development ProgramAustralian National Railways CommissionAustralian Rail Track Corporation LimitedCivil Aviation Safety AuthorityInternational Air Services CommissionNational Rail Corporation LimitedNational Road Transport CommissionStevedoring Industry Finance CommitteeSydney Airport Corporation* Referred also to the Standing Committee on Primary Industries and Regional Services and to the Joint Standing Committee on the National Capital and External Territories** Referred also to the Standing Committee on Employment, Education and Workplace RelationsTreasury PortfolioAustralian Competition and Consumer Commission*National Competition Council**Productivity Commission** Referred also to the Standing Committee on Economics, Finance and Public Administration and to the Standing Committee on Industry, Science and Resources** Referred also to the Standing Committee on Economics, Finance and Public AdministrationStanding Committee on Economics, Finance and Public AdministrationFinance and Administration PortfolioDepartment of Finance and AdministrationCommissioner for SuperannuationCommonwealth Grants CommissionCommonwealth Superannuation AdministrationOffice of Asset Sales and Information Technology OutsourcingParliamentary Retiring Allowances TrustRemuneration TribunalPrime Minister and Cabinet PortfolioDepartment of the Prime Minister and Cabinet*Australian National Audit OfficeCommonwealth and Defence Force Ombudsman**Management Advisory BoardOfficial Establishments TrustPublic Service and Merit Protection Commission* Referred also to the Standing Committee on Aboriginal and Torres Strait Islander Affairs** Referred also to the Standing Committee on Legal and Constitutional Affairs and the Joint Standing Committee on Foreign Affairs Defence and TradeTreasury PortfolioDepartment of the TreasuryAustralia and the International Monetary FundAustralia and the World BankAustralian Bureau of StatisticsAustralian Accounting Standards BoardAustralian Competition and Consumer Commission*Australian Loan CouncilAustralian Prudential Regulation Authority Australian Securities and Investment CommissionAustralian Statistics Advisory CouncilAustralian Taxation OfficeCompanies and Securities Advisory CommitteeCouncil of Financial RegulatorsDevelopment Allowance AuthorityForeign Investment Review BoardNational Competition Council**Payments System BoardProductivity Commission*Reserve Bank of AustraliaRoyal Australian MintSuperannuation Complaints Tribunal* Referred also to the Standing Committee on Communications, Transport and the Arts and to the Standing Committee on Industry, Science and Resources** Referred also to the Standing Committee on Communications, Transport and the ArtsStanding Committee on Employment, Education and Workplace RelationsEducation, Training and Youth Affairs PortfolioDepartment of Education, Training and Youth AffairsAnglo-Australian Telescope BoardAustralian National Training AuthorityAustralian Research CouncilCouncil of the Australian Maritime CollegeCouncil of the Australian National UniversityCouncil of the University of CanberraEmployment Services Regulatory AuthorityHigher Education CouncilStates Grants (Primary and Secondary Assistance)Employment, Workplace Relations and Small Business PortfolioDepartment of Employment, Workplace Relations and Small BusinessAffirmative Action AgencyAustralian Industrial Relations CommissionCoal Mining Industry (Long Service Leave Funding) CorporationComcare AustraliaDefence Force Remuneration Tribunal*National Industrial Chemicals Notification and Assessment SchemeNational Occupational Health and Safety Commission**Office of the Employment Advocate Seafarers Safety, Rehabilitation and Compensation AuthoritySafety, Rehabilitation and Compensation Commission* Referred also to the Joint Standing Committee on Foreign Affairs, Defence and Trade** Referred also to the Standing Committee on Family and Community AffairsTransport and Regional Services PortfolioAustralian Maritime Safety Authority** Referred also to the Standing Committee on Communications, Transport and the ArtsStanding Committee on Environment and HeritageEnvironment and Heritage PortfolioDepartment of Environment and HeritageAustralian Antarctic Foundation*Australian Heritage CommissionBureau of MeteorologyGreat Barrier Reef Marine Park AuthorityNational Cultural Heritage CommitteeSupervising Scientist for the Alligator Rivers RegionWet Tropics Management Authority* Referred also to the Joint Standing Committee on the National Capital and External TerritoriesStanding Committee on Family and Community AffairsEmployment, Workplace Relations and Small Business PortfolioNational Occupational Health and Safety Commission** Referred also to the Standing Committee on Employment, Education and Workplace RelationsFamily and Community Services PortfolioDepartment of Family and Community ServicesAustralian Institute of Family StudiesData-matching ProgramForeign Affairs and Trade PortfolioRights of the Child (Report under the UN Convention on the Rights of the Child)** Referred also to the Joint Standing Committee on Foreign Affairs, Defence and TradeHealth and Aged Care PortfolioDepartment of Health and Aged CareAdvisory Panel on the Marketing in Australia of Infant FormulaAustralia New Zealand Food AuthorityAustralian Hearing Services Australian Institute of Health and WelfareAustralian Nuclear Science and Technology Organisation*Health Insurance CommissionMedibank PrivateNational Food AuthorityNational Health and Medical Research CouncilNursing Homes Standards Review PanelsPharmaceutical Benefits Pricing AuthorityPharmaceutical Benefits Remuneration TribunalPrivate Health Insurance Administration CouncilProfessional Services Review (Health)Social Security Appeals Tribunal* Referred also to the Standing Committee on Industry, Science and ResourcesImmigration and Multicultural Affairs PortfolioDepartment of Immigration and Multicultural Affairs** Referred also to the Joint Standing Committee on MigrationStanding Committee on Industry, Science and ResourcesEmployment, Workplace Relations and Small Business PortfolioDepartment of Employment, Workplace Relations and Small Business** Referred also to the Standing Committee on Employment, Education and Workplace RelationsForeign Affairs and Trade PortfolioExport Finance and Insurance Corporation** Referred also to the Joint Standing Committee on Foreign Affairs, Defence and TradeIndustry, Science and Resources PortfolioDepartment of Industry, Science and ResourcesAdvance Australia FoundationAustralian Industry Development CorporationAustralian Institute of Marine ScienceAustralian Nuclear Science and Technology OrganisationAustralian Science, Technology and Engineering CouncilAustralian Sports CommissionAustralian Sports Drug AgencyAustralian Tourist CommissionCommonwealth Scientific and Industrial Research OrganisationDirector of Chemicals Notification and AssessmentGenetic Manipulation Advisory CommitteeIndustry Research and Development Board Joint Coal BoardNational Standards CommissionPooled Development Funds Registration BoardSafety Review Committee (Australian Nuclear Science and Technology Organisation)Snowy Mountains CouncilSnowy Mountains Hydro-electric AuthorityEnergy Research and Development CorporationTreasury PortfolioAnti-Dumping Authority*Australian Competition and Consumer Commission**Australian Customs Service*Productivity Commission*** Referred also to the Standing Committee on Economics, Finance 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CouncilAustralia-France FoundationAustralia-India CouncilAustralia-Indonesia InstituteAustralia-Japan FoundationAustralia-Korea FoundationAustralian Centre for International Agricultural Research*Australian Trade CommissionExport Finance and Insurance Corporation**Rights of the Child (Report under the UN Convention on the Rights of the Child)**** Referred also to the Standing Committee on Primary Industries and Regional Services** Referred also to the Standing Committee on Industry, Science and Resources*** Referred also to the Standing Committee on Family and Community AffairsPrime Minister and Cabinet PortfolioCommonwealth and Defence Force Ombudsman** Referred also to the Standing Committee on Economics, Finance and Public Administration and the Standing Committee on Legal and Constitutional AffairsJoint Standing Committee on MigrationImmigration and Multicultural Affairs PortfolioDepartment of Immigration and Multicultural Affairs*Immigration Review TribunalMigration Agents Registration BoardRefugee Review Tribunal* Referred also to the Standing Committee on Family and Community Affairs Joint Standing Committee on the National Capital and External TerritoriesTransport and Regional Services PortfolioDepartment of Transport and Regional Services*National Capital Planning AuthorityAustralian Antarctic Foundation*** Referred also to the Standing Committee on Communications, Transport and the Arts and to the Standing Committee on Primary Industries and Regional Services** Referred also to the Standing Committee on Environment and HeritageParliamentary Joint Committee on Native Title and the Aboriginal and Torres Strait Islander Land FundPrime Minister and Cabinet PortfolioIndigenous Land Corporation*National Native Title Tribunal** Referred also to the Standing Committee on Aboriginal and Torres Strait Islander AffairsMatters of Public Importance1737173710000SPEAKERMr SPEAKER—I have received a letter from the honourable member for Dickson proposing that a definite matter of public importance be submitted to the House for discussion, namely:The failure of the government to accept responsibility for the administration of aviation safety in Australia, in particular its failure to address and resolve air safety concerns surrounding the Class G airspace demonstration.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—15:24:001737Kernot, Cheryl, MPMs KERNOTXW4DicksonALP00—Notwithstanding the announcement of the Minister for Transport and Regional Services in question time today, we do have a major problem with aviation safety in this country, and that problem can be summed up in one word—accountability. Today the minister has finally been forced to act, not regrettably, I am sorry to say, because of a natural instinct for public safety but because of a chronicle of failures and dissent which has forced the minister to take this action.Something has gone terribly wrong with Mr Dick Smith's frolic on affordable safety in this country. Fortunately for us, it has gone wrong publicly and before a serious accident has happened. We know that there is widespread concern within the aviation industry about the Civil Aviation Safety Authority's management of its Airspace 2000 plan and, in particular, its class G airspace trial between Canberra and Ballina.We know there is also widespread concern about Airservices Australia's review of its operations and its undisclosed plans for how its services will be provided in the future. We know that there is dissatisfaction within CASA and Airservices Australia about the overall direction those organisations are taking. We know pilots, air traffic controllers, airport operators, the airlines, the small general aviation businesses and a host of others within the aviation industry believe that they are not being properly consulted about air safety and about the government's plans for Australian aviation.We know something is wrong because we now have before us a chronicle of mismanagement, a lack of transparency, a lack of accountability and, until a few moments ago, a complete dodging of responsibility when it comes to the demonstration of class G airspace in the Canberra to Ballina corridor. We were wondering, Minister, just what it would take to make you stand up and say, `That's enough; it's time for me to act.'Mr Anderson interjecting—XW4Kernot, Cheryl, MPMs KERNOT—And we should not forget, Minister, that under section 12 of the act you are entitled to direct CASA—and you know it. Let us not forget, Minister, though, that it was your side—10000DEPUTY SPEAKERMr DEPUTY SPEAKER (Mr Nehl)—No, the member for Dickson will address her remarks through the chair.DT4CREANMr Crean—What about the interjection?10000DEPUTY SPEAKERMr DEPUTY SPEAKER—I will deal with him and you later. The honourable member for Dickson has the call.10000Kernot, Cheryl, MPMs KERNOT—Mr Deputy Speaker, we must not forget it was the coalition, through the former Minister for Transport and Region al Services, Mr John Sharp, who said, `We have to do something about air safety. We have to change the board of CASA. We have to install Mr Dick Smith; we have to sack Mr Leroy Keith,' supposedly in the interests of restoring public confidence in the management of aviation safety. This has been their first big test, and it has been a spectacular shambles.Let us have a look at the way this shambles has unfolded. It started in October. Despite strong criticism of its plans, not the least of those criticisms being that pilots have not been properly trained and briefed on the new system—despite being told that this was a fundamental requirement before the trial would start—CASA commenced the class G airspace trial.Shortly afterwards, Qantas, in response, ceased flights into four regional centres within that trial airspace because of their safety concerns and because the undertakings given to it by CASA had not been met. I remind the House that at that time, in early November, the opposition started calling for the minister to direct CASA to suspend the trial. The next thing that happened was that CASA was forced to make changes to ensure there would be greater use of radar in the trial area before Qantas would resume their flights. Then, in mid-November, an Eastern Airlines plane and a RAAF plane narrowly avoided a mid-air collision. Then, later in November, the RAAF suspended all but essential military flights into the class G airspace.As if that was not enough, in early December the ABC 7.30 Report revealed conflict within Impulse Airlines over its decision to keep flying in the trial airspace after Qantas suspended its services. Last Sunday, the New South Wales Air Ambulance said it would operate only emergency flights into the trial airspace following three near misses involving air ambulances. On Monday of this week, Impulse Airlines sacked its chief pilot after he publicly, in the interests of aviation and public safety, raised his concerns about the trial. Also on Monday of this week, in response to my question, the minister told the House that CASA is responsible for air safety, and he very confidently tabled a letter from Mr Toller, the Director of CASA, in which Mr Toller said:Criticism of the Class G demonstration is not soundly based on legitimate safety issues and reflects, to some degree, an understandable resistance to change in airspace arrangements that have existed for decades.On Monday, the minister said he accepted Mr Toller's advice. Today, Wednesday—two days later—that criticism is apparently not soundly based. Yesterday, the Federation of Australian Air Pilots called for the suspension of the trial. It has taken this chronicle of events for the minister to act, to actually take responsibility for his portfolio area—not to oversee governance, but to be a minister, to be what you were elected to be, Minister, and to take charge. I should point out that underpinning this public saga of chaos and mismanagement are the many pilots, air traffic controllers, flight operations managers and others who have been expressing serious concern about the management of airspace in this country.Mr Deputy Speaker, neither the minister nor I has to be a technical expert on these matters. We accept that technical expertise rests in CASA and BASI, but I do believe that the minister has sat back and ignored widespread and consistent concern. I do believe that the minister has erred in simply taking the advice of those who are telling him that this is solely a matter about resistance to change and that the width of an air corridor is an industrial matter. That is Mr Dick Smith's line. Whenever there is dissent about Mr Smith's interpretation of what constitutes aviation safety, it is always flick-passed off as an industrial matter.Two things have happened here. The first is that the aviation industry, like so many other industry sectors, is suffering from a case of reform fatigue. Uncertainty, anxiety, suspicion—this is what happens to people when they feel that reform is coming at them too fast, in an incoherent way, and they are not being kept informed about what is going on. We have seen it in so many other areas, yet the government—and CASA in this case—have clearly failed to learn those lessons. Do not forget, Minister, that running alongside this particular issue are your plans to privatise air traffic control services— plans that you are also keeping under wraps and plans which are adding to industry uncertainty.The second thing that has happened here is a classic case of the failure of accountability. It is a classic example of the mess that organisations and governments can get into through a failure to be open and inclusive about their plans and decisions.This chronicle of events has highlighted arrogance, secrecy, defensiveness and an inability to accept criticism. There has been a zealous defence, particularly by Mr Dick Smith. He can never be wrong about anything to do with aviation in this country. I suggest that Mr Smith takes a good, hard, long look at your decision today. You do not have to be a genius to recognise symptoms of mismanagement and a classic compromise against the public interest.You do not even have to agree with the criticisms or concerns about the class G trial to see that CASA has managed its implementation very badly. It is that arrogance, that lack of accountability, that led CASA to box itself and the minister in just as recently as Monday afternoon. Today, here in question time, the minister has had to get himself miraculously out of that box for the moment.There has been a tendency in recent years for ministers to push responsibilities away from their direct concern and their direct supervision. We were taunted in question time about Labor's past policy on aviation safety. Let me say absolutely unequivocally that Labor believes very strongly that air safety is a government responsibility that cannot be shoved off the minister's desk. In the past, Senator Parer, when he was the shadow minister for aviation, and former minister John Sharp are on the record as saying that it is the minister who is ultimately responsible for aviation safety in Australia. I think you need to read the act, Minister. Your previous ministers have accepted responsibility in this area. They were right to do so.Today, in this House, we have seen the minister finally acting. We all know that he has been forced to act because of the BASI report. We do know that BASI has a reputation for independence and competence. We know that the minister has not done this this afternoon as a grand gesture of ministerial responsibility. We know he has done it because even he could see where this was headed after he got the BASI report.I cannot understand, Minister, why, on the very first day that you got this portfolio, alarm bells about aviation safety did not ring in your office. Why didn't you sit down and say, `What's the primary issue in this area of the portfolio'?Mrs Vale interjecting—10000DEPUTY SPEAKERMr DEPUTY SPEAKER (Mr Nehl)—Order! The member for Hughes!XW4Kernot, Cheryl, MPMs KERNOT—Mr Deputy Speaker, I am happy to accept that interjection.Honourable members interjecting—10000DEPUTY SPEAKERMr DEPUTY SPEAKER—The member for Hughes will be silent, as will the member for Banks. The member for Dickson has the call and is not being assisted by other members.Mr Tuckey interjecting—10000DEPUTY SPEAKERMr DEPUTY SPEAKER—Order, Minister!XW4Kernot, Cheryl, MPMs KERNOT—I am still happy to acknowledge that interjection, because one thing which Labor can proudly say is that Dick Smith was never part of our aviation safety future in this country. The minister's claim that by failing to act—Mr Anderson interjecting—10000DEPUTY SPEAKERMr DEPUTY SPEAKER—The minister does not have the call and will wait until he does.XW4Kernot, Cheryl, MPMs KERNOT—I said aviation future.4K4ANDERSONMr Anderson—Oh!XW4Kernot, Cheryl, MPMs KERNOT—I said he has no place.Government members interjecting—10000DEPUTY SPEAKERMr DEPUTY SPEAKER—Members on my right will be silent.XW4Kernot, Cheryl, MPMs KERNOT—I am thinking of Mr Smith wearing a previous hat, Mr Deputy Speaker. With regard to the minister's claim that by failing to act he was somehow keeping politics out of air safety, I think he has set himself a very weak excuse indeed. The failure to act is a political decision in itself. It is a decision that says, and continues to say, that the minister has chosen to back CASA's management of this issue.I think the same questions remain. It is not about technical issues, it is not about political interference in technical decisions about the regulation of air safety; it is about the management of these issues. It is about the administration of CASA and it is about the failure of CASA and the government to be open and accountable on aviation safety. That is the issue, and no amount of pretence by the minister after he has been forced to act can disguise that fact.15:37:001740Anderson, John, MPMr ANDERSON4K4GwydirNPDeputy Prime Minister10—I note the somewhat truncated MPI from the shadow minister and I say at the outset that the problem the shadow minister has is that she has blatantly sought to politicise air safety in Australia. That is what she has done.MG4LEEMr Lee—Unlike John Sharp.4K4Anderson, John, MPMr ANDERSON—Her predecessor, in answer to the point made by interjection, the member for Melbourne, continually in this place told John Sharp to stay out of aviation safety and to leave it to the experts—because you had set up the appropriate model.It is hard to know where to start in responding to the drivel that we have just heard. Let me begin by making one point. You grossly offend a very decent and competent man, the Director of Aviation Safety in Australia—Ms Kernot interjecting—4K4Anderson, John, MPMr ANDERSON—Hear me out—because you assume that I was forced to act. He gave a commitment in writing to me, which I tabled in this place, which said that should they—CASA or BASI—identify serious problems he would call the demonstration off. He called the trial off. I did not intervene. That is actually clear evidence that the very model of safety aviation which you put in place, and which we made workable by giving it a decent board—Ms Kernot interjecting—4K4Anderson, John, MPMr ANDERSON—Not interested in hearing, I know—is working. That is the point. Where do I start? You obviously have not read the background to the policy that we have today on the statutory authority that you put in place to oversee safety in this country. But, worse than that, you have not read the policy that this side of government that you now belong to took to the election. It is pretty lightweight. I have it here. But it is quite succinct when it comes to aviation policy. It says in part `ensuring that Civil Aviation Safety Authority resources are focused on protecting the safety of the fare paying passenger' and `that CASA functions free of political interference'. We have seen weeks of attempts by the shadow minister to repoliticise it, to make sure that it is subject to political interference. Then we hear her saying that I should intervene. She is plainly implying that, per some misfortune, were she to be the minister for aviation she would have cancelled the trials. That is the clear implication of what you are saying. You would have cancelled the demonstration.XW4KERNOTMs Kernot—Neither of them without proper consultation.10000SPEAKERMr SPEAKER—Order! The honourable minister will address his remarks through the chair and will ignore the member for Dickson.4K4Anderson, John, MPMr ANDERSON—Mr Speaker, it is quite obvious that, having inherited the portfolio, had that happened, she would have cancelled them ahead of expert advice from BASI and in direct contradiction to the member for Kingsford-Smith's policy, which specifically sets up a body of experts at arm's length from government. In their case that was a very good thing to do.Mr Brereton interjecting—4K4Anderson, John, MPMr ANDERSON—Your record on aviation safety was very unattractive, my friend, and you are well remembered for it; and it is not hard to find the reasons why you sought to distance yourself.Opposition members interjecting—4K4Anderson, John, MPMr ANDERSON—There is no doubt about it. You always know when they feel embarrassed. They shout all the louder. You always know. But I have the floor and your objective is to ensure that I am not heard. Let us go back to the member for Kingsford-Smith's introduction into this place, via someone else—I think he was overseas at the time—of the current arrangements. I think the House would do well to take note of this. I should state at the outset that my side of the House believes that an independent statutory authority comprising experts who understand aviation safety is likely to know more about aviation safety than people like the member for Gwydir or the member for Dickson. It was Mr Elliott, the then member for Parramatta, Parliamentary Secretary to the Treasurer and Parliamentary Secretary to the Minister for Communications and the Arts, who in 1995 said in part:. . . the decision to remove the aviation safety regulatory function from the Civil Aviation Authority and place it in a separate and entirely independent statutory authority—was part of the government's objectives. It went on to say about the body, to be known as CASA:CASA's leadership, strategic direction and management of aviation safety will be considerably enhanced through its establishment as an independent authority, the appointment of an acknowledged expert on aviation safety as its new director and the subsequent appointment of a small, expert board.We had to fix that up. It now has an expert and appropriate board—CASA's board will comprise the chairperson, the Director of Aviation Safety and up to three other members. A major priority of the board and the Director of Aviation Safety will be to address the various management problems that have emerged over the last 12 months.Management problems that emerged when?—when the member for Kingsford-Smith and the Labor Party were running aviation safety in Australia. That is when we had really chronic management problems in aviation safety in Australia. And, under pressure, recognising that you had to do something about it, you set up a model which we supported. You did not give it the expertise it needed. We had to do that. And we know how difficult it was, because Minister Sharp ran into constant obstruction from some people who might be generally allied with your side of politics. But we got a board in there that the Australian community can have trust in, albeit one that you want to undermine confidence in now in what can only be described as an absolutely shabby, political exercise—but the model is a good one.This is very important because it is obvious that, fresh from the Senate, fresh from that other political party whose byword for existence was intervention in everything, regulate everything to death, smother it with the dead hand of government and then wonder why it does not work—like aviation safety—she does not understand how an independent statutory authority works and it is very obvious that she does not understand how the powers of the minister in relation to such an independent authority work. The second reading speech records:The minister may give CASA written instructions as to the performance of its functions or its exercise of its powers but, in respect of the performance of CASA's regulatory function, the directions shall be only of a general nature.The government believes that the proposed responsibility and accountability framework in the bill provides a proper balance between the exercise of ministerial strategic direction and accountability and the day-to-day exercise by CASA of its powers and functions.The reality is that I have kept very close to CASA because I am concerned about aviation safety in this country. I want to be satisfied that we have an excellent board, that the director of aviation safety really knows what he is talking about.It is very obvious too that the shadow minister who raised this matter believing that the skies were about to fall in does not want to hear the response and does not want to understand how a statutory authority that they set up works, what the general powers of direction are and what they are not. It is made quite obvious in their aviation policy that they had no intention of changing those arrangements at all—none. They were going to remain with them had they, by some misfortune, come into power.5T4BRERETONMr Brereton—It's very embarrassing!4K4Anderson, John, MPMr ANDERSON—Please keep saying it. Thank you very much. The member for Kingsford-Smith says it is very embarrassing.5T4BRERETONMr Brereton—For you. For you, I said.10000DEPUTY SPEAKERMr DEPUTY SPEAKER (Mr Nehl)—The member for Kingsford-Smith will remain silent.4K4Anderson, John, MPMr ANDERSON—This is unbelievable. When the ALP introduced the arrangements that set up CASA, what was the record on air safety then? It was so bad that, in their second reading speech, they had to acknowledge that it had obviously not been functioning. Unfortunately, regrettably and tragically, the evidence that it had not been functioning was very easy to find. It is also worth remembering that they had been in government for a very long time before they set in place a more appropriate regulatory framework to ensure the safety of the Australian public.When it comes to accountability, take for example the accusations that were made here recently that I had not discharged my responsibilities properly in this regard in relation to the Skehill report. I made it quite plain by written direction, preceded by a telephone call to CASA, that in relation to the issues raised in the Skehill report they were to report to me concurrently with the release of BASI's investigation into this matter on how they would respond to the issues raised.It is quite apparent that in the meantime—I do not know what more you could ask for—the airline involved in the SBS tragedy had been grounded: it could not fly, its aircraft could not go up, no-one was in danger there and the three officers involved had been moved or had otherwise resigned. What more could be done there I am not quite certain. Perhaps we will hear from the member for Kingsford-Smith, who in government was such an expert on aviation safety but in opposition is prepared to be opportunistic. He is prepared to play a part in nothing more than a cheap politicisation which he knows is a politicisation. Who is it in this place who is trying to raise the ire and the concern of the travelling public on today's airlines? Who is it? It is the ALP—the very people who claimed to be sorting out the situation in the first place.That is the first point I wanted to make in relation to accountability. In relation to the second point—the question of the manage ment of airspace in this country—I have remained very close to this debate. The fact of the matter is that there have been some quite divergent opinions on it from people who know an enormous amount about aviation safety. It might be quite advisable if those opposite who purport now to be such experts—they did not in government, but they do now—read the BASI report which will be released shortly before they conclude that there is a clear-cut, open and shut case in relation to safety here.Mr Brereton interjecting—4K4Anderson, John, MPMr ANDERSON—You were once the minister responsible.10000DEPUTY SPEAKERMr DEPUTY SPEAKER—No, address your remarks through the chair, Minister.4K4Anderson, John, MPMr ANDERSON—Mr Deputy Speaker, the member opposite knows that there is an established pattern for BASI in releasing its report.Mr Brereton interjecting—4K4Anderson, John, MPMr ANDERSON—That is an offensive remark and I ask that it be withdrawn. I am not hiding anything whatsoever, Mr Deputy Speaker. I ask that it be withdrawn.Mr Brereton interjecting—4K4Anderson, John, MPMr ANDERSON—Because it is BASI's to release. They will release it this afternoon in accordance with their usual way. Mr Deputy Speaker, I find it offensive that the member opposite should imply that I am hiding something. I ask him to withdraw.10000DEPUTY SPEAKERMr DEPUTY SPEAKER—I would be grateful if you would withdraw that remark since the minister finds it offensive.5T4BRERETONMr Brereton—Withdraw which remark, Mr Deputy Speaker?10000DEPUTY SPEAKERMr DEPUTY SPEAKER—The one that he has just detailed twice—and do not play with me.5T4BRERETONMr Brereton—I am not playing with you.Government members interjecting—5T4BRERETONMr Brereton—I am not, sir. No, I am not. I made the point and I made it very—10000DEPUTY SPEAKERMr DEPUTY SPEAKER—No, we are not making any points at the moment. You have been asked to withdraw the comment that you made. You charged the minister with hiding something which he found offensive.5T4BRERETONMr Brereton—I would like the report, Mr Deputy Speaker.10000DEPUTY SPEAKERMr DEPUTY SPEAKER—That is quite irrelevant. Are you going to withdraw?5T4BRERETONMr Brereton—If you direct me to, I will.10000DEPUTY SPEAKERMr DEPUTY SPEAKER—Thank you very much.4K4Anderson, John, MPMr ANDERSON—I am not hiding anything.Mr Brereton interjecting—4K4Anderson, John, MPMr ANDERSON—BASI are going to release it this afternoon—that is my advice. That is entirely appropriate.Mr Brereton interjecting—4K4Anderson, John, MPMr ANDERSON—If there is one thing that can be said for certain it is that they never actually care to repeat what they know to be the case. It is usual and normal when BASI release a report of this sort that the affected parties are given around 24 hours to examine it and to respond. This is, I think, entirely fair, reasonable and responsible and is likely to reduce the emotion that you are obviously intent on driving in relation to air safety in this country.I want to recap a couple of points in the brief time remaining to me. I make it very plain indeed that the system that you put in place and that you now want to pull down and indicate is no good has worked. I did not have to direct CASA to pull this demonstration off; the director of aviation safety in Australia—a man who was, in my view, denigrated in this place by the cheap shots taken by the member for Dickson—pulled them off. He was as good as his word; the word he gave me in written form and which I tabled in this place.I think it is a very sad day indeed when we in this place take it upon ourselves to make shabby assumptions about people and to shabbily assume that a minister had to interfere when a perfectly responsible, highly trained individual who is respected by people in the industry met the obligations that he undertook to meet in this place in written form, in the form of the letter that I tabled. I think it is a great tragedy for aviation safety in this country that the shadow minister has so quickly chosen to so seek to muddy the waters, to so seek to emotionalise and trivialise what are very serious issues indeed.When it comes to accountability, the fact of the matter is that I have required the permanent head of my department to give a full response to the issues raised, in coordination with the affected parties, by 22 December. That is appropriate. In relation to the earlier problem, BASI's report, CASA's response and, if I deem it appropriate, the Skehill report will all be released in January. That is open, transparent and entirely responsible.15:52:001743Horne, Bob, MPMr HORNEUU5PatersonALP00—I rise to support the shadow minister on something that is extremely important. It is important because this is the first time, I believe, in the current government that a minister has come here to answer an MPI personally. The minister claims that we on this side have politicised this issue, but this just goes to show that it was he who was talking about the politics of the situation. This is what you get when you move a minister sideways, a minister who was not wanted by the farming community as Minister for Primary Industries and Energy—you give him aviation, let him look after that. We can already see his record, that is, what he has not done.Let us talk about ministerial responsibility. If it was not the responsibility of the Minister for Transport and Regional Services to indicate to CASA that this trial should be called off, whose responsibility was it? Who was out there listening, not to members of the opposition but to the practitioners in the air industry, listening to the pilots?On the night before the newly elected federal Labor Party met here for its first caucus meeting, when I was travelling from Newcastle—an area affected by the class G airspace trial—I received a phone call from a pilot who said, `Are you aware of the trial that is taking place?' I said, `No, tell me.' He said, `Mate, I would not be flying to Canberra tomorrow if I were you.' I said, `I've booked my seat.' He said, `Well look out every window,' and that is exactly what I did. I did not rest. I did not read a newspaper. My eyes were glued on what was out the window. What did we find over the following months? We found exactly the sort of thing that this pilot was warning us about.Yesterday, I was back in my electorate on some important business. While I was driving along the road, I listened to an interview on ABC radio—that is about all they can do these days; they cannot afford much else—between the host of a talkback session and a pilot who was asked, `If you were travelling from Sydney to Ballina this weekend, would you fly?' The pilot said, `Under no circumstances. I'd find an alternative means of transport.' Then he was asked why. He said, `It simply is not safe.' Then he started to enumerate a number of close shaves. He was asked, `What do you mean by a close shave?' He said, `That's where the planes come too close for comfort.'At Newcastle, we share the airport with a RAAF facility where we have the fastest planes in Australia, and quite a number of them too. We are mixing RAAF aircraft with commercial aircraft, and this is the area where CASA have taken off the surveillance, for whatever reason, of aircraft movements. A high ranking officer from the RAAF recently visited Williamtown and saw some of those close shaves. What was his instruction? It was to have two pilots in every Air Force aeroplane that was on manoeuvres in that area—one flying and one observing.When people of that magnitude go public and make the statement that we should be concerned about air safety, that is when I believe we have a right to voice those concerns with the minister. It is not the right of the minister to hide behind a body that has been appointed by a government and say, `It is their responsibility; it is not mine.' What does he want to happen? Does he want a disaster? It would appear he does. It has taken a month, and finally the minister or CASA have acted and the trial has been withdrawn.Make no mistake why it has been withdrawn. It has been withdrawn because of pressure from the opposition that has finally forced commonsense to prevail and the G airspace trial is finished. I can assure you there are many people from here to the North Coast who are extremely relieved. The other thing we have to question is: what damage has been done? What about the people who have listened to these pilots and are aware that one airline has sacked its chief pilot and that a leading RAAF officer has come out and said, `You have to have two pilots in every plane'? A lot of those people are not going to go back to flying readily. They will not see the snippet in the papers tomorrow, which I guarantee will be small, saying that the class G airspace trial is off. So people will continue not to fly to major tourist destinations on the Mid North Coast and North Coast of New South Wales. This trial has done irreparable harm to industries in that area, the tourist industry in particular.Unfortunately, members on the other side would not know how important jobs are in the Hunter where people are suffering from unemployment which is more than 50 per cent greater than the national average. I daresay there have been redundancies in the tourism industry simply because people have not been prepared to fly into this major tourist mecca.Let us talk about ministerial responsibility and accountability, because what we have heard today from this minister is a complete shambles. He did not know what he was debating; he did not want to talk about the issue; he did not want to respond to the shadow minister. He wanted to put on a facade of political bravado—I am not sure what he wanted to do actually—but he certainly did not address the question. He wanted to tell us how responsible Dick Smith is. Well, if this is a measure of Dick Smith's responsibility, I suggest that the minister should get on the phone to him immediately; they should have a conference and decide where air safety is going in this country, because the G class airspace trial is not helping anyone's credibility or a credit to anyone.I would think that this minister should go down on his knees, should look heavenward and say `Thank goodness there was someone else overlooking air safety in this country', because everything that has happened so far has certainly relied on that element of luck; it certainly was not good management. And yet we heard the minister in question time today and in response to the shadow minister saying, `The board is working.' This is evidence today of what a responsible opposition can do. By raising important matters in a parliament and persisting with them you can get a government to change its mind. Air safety is just one. And there are many others that we will continue to respond to over the next three years, because we listen to people.In conclusion, if I am ill, who do I go to? I go to a doctor, because he has hands-on experience; I do not go and consult with the minister for health. If I have to put in a tax return, I visit my accountant; I certainly do not go and see the minister for finance. And if I am concerned about air safety, I listen to the pilots, because I know it is their decision, it is their responsibility, to determine whether the people travelling in planes are being carried safely. They told us on this side that people were not being carried safely, and that is why we got the message out. Thank goodness, finally, this minister was dragged kicking and screaming to make the right decision. But it is the right one and we support it. The shame is that it took so long and it placed so many lives in jeopardy, and that is a disgrace to this minister.16:02:001745Lieberman, Lou, MPMr LIEBERMANXU5IndiLP10—One would have thought that the opposition, after moving such a motion concerning the alleged failure of the government to accept responsibility for the administration of aviation safety and the failure to address and resolve their safety concerns regarding class G airspace, would have put some substantial facts before the parliament so that they could sustain and justify their action in bringing this MPI. In fact, they have done quite the opposite. What they have done has revealed their lack of sincerity, their lack of substance and their lack of responsibility.I give you some examples of why I say that. Firstly, it is only about eight or so weeks ago that we had a federal election. Both sides of politics, all parties, had the opportunity to put before the public what they thought about aviation safety, what they thought needed to be done by the minister, and what changes needed to be put in place by their minister— or any minister for that matter—in the Commonwealth government regarding air safety.The Labor Party document on aviation policy shows that in effect what they are saying is that they will maintain the policy originally modelled by the former minister in this place, the member for Kingsford-Smith, who had the opportunity to speak today on the MPI and did not—remarkably. And I think that ought to be noted, because that sends out certain signals as well. So there was nothing in the policy of the Labor Party, the party for whom the member for Dickson is now the shadow minister in this area, nothing at all to indicate that there ought to be substantial changes in the role of the minister in relation to aviation safety.In fact, from what I heard the member for Dickson say, there is substantial support for the actions of John Anderson—an excellent Minister for Transport and Regional Services—in his actions and behaviour, because what this government is doing and what this minister is doing is ensuring that the crucial issues of air safety are dealt with by appropriate experts, free of politics, who are accountable through their departments and their statutory functions to the minister through to the parliament and the public of Australia. So nothing at all came today from the opposition, the member for Dickson or the member for Paterson to substantially establish anything at all about the process that would be detrimental.So we have actually seen unfold in the minister's hands—and thank goodness John Anderson is the minister—a correct approach to the administration of air safety. He has required at all times that the statutory officers in CASA and BASI provide reports, respond and are accountable. And the minister himself has made available to this parliament letters from the director of civil aviation air safety, Mick Toller, as early as this week, explaining circumstances in relation to class G airspace. The minister himself has done that and made information available. The minister today has informed us that the process that he supervises, which is substantially the administrative process set up by the member for Kingsford- Smith during the 13 years of Labor government in Australia, has in fact been proceeding to the point where now the experts, the people that must advise us and give independent advice, have said that the class G airspace demonstration will now cease and will be assessed according to what they have learnt during the demonstration. Furthermore, the minister is very properly and correctly requiring his department to come to him by 22 December—I think he said—with an overview and a report of the various functions of people involved in this process.I have another point about the member for Paterson. He raised some very serious matters as a federal member of the parliament. In support of the member for Dickson's pitiful attempt to cause problems with her MPI, the member for Paterson told us that he was privy to information from pilots. He was given information by pilots which indicated grave matters on safety which were of concern. Because I was not given prior notice, I do not know whether the member for Paterson reported those matters or whether he asked the pilots concerned to provide substantial information and facts on the air safety matters that were so serious that the member for Paterson said that he was told not to fly.I challenge the member for Paterson to come back to this House and indicate whether or not he conveyed that information to the appropriate independent authorities which are charged with responsibility for investigating serious matters of air safety. If he did not, why didn't he? Why did he wait until today to raise the matters in a rhetorical way and to cause alarm and concern in his support of the very pitiful attempt by the member for Dickson to create a major political issue when she herself had failed to sustain her case? The minister has acted very correctly in accordance with the legislation and his responsibilities. He has done what you would expect him to do.The policy which the Labor Party put before the people until 3 October was to support that process. What we have today is a failure by the opposition to make its case. It is an opposition full of rhetoric, and an opposition which made very serious claims through the second speaker on the MPI. The opposition has a responsibility to account for its actions and to indicate what the member did with that knowledge. It is now 9 December. When did these incidents occur? Why has there been a delay, prima facie, in the member for Paterson conveying that information to the appropriate authorities and asking the pilots involved to do the same?Let us look at what is ahead of us. The minister has outlined a very responsible and correct approach to achieving the best air safety standards—standards that all Australians want. He has outlined a process which will require further reporting to him by the people involved. They have the statutory responsibilities under the legislation; legislation which was substantially set up by the previous Labor government to separate from the political arm, from the parliament, the necessary processes of advice, evaluation and supervision.Surely to God, the community—those who are listening to this debate and the commentators in the media who will report on it—is entitled to conclude clearly that we have an excellent Minister for Transport and Regional Services who, on behalf of the Howard-Fischer government, is attending to the business that he is responsible for in a very correct manner, and who requires the people who are responsible for air safety, supervision and regulation to respond and report. That will be done in a very transparent way. The minister has already outlined that.Surely that is the process that we in Australia should expect and not a process, as it appears the member for Paterson wanted in his speech in support of his shadow minister, where a member of parliament is the one who determines the facts and the one who determines whether or not a particular process or regulation is efficient. That is really what they are putting. It is contrary to what the shadow minister said, because in effect she said that she was not qualified to make the technical judgments and give the technical advice necessary to achieve air safety. She acknowledged that.Does the member for Dickson expect the minister to have the technical knowledge and expertise to supplant the technical knowledge and expertise that the people of Australia have provided through the various legislative processes and through CASA and BASI? They are the ones who are required to perform. The minister clearly requires them to perform, and the minister has set out a timetable for them to respond in respect of the remaining elements of the class G airspace demonstration process.The results of the class G demonstration process will be made public so that everyone will be able to respond to and learn from that, remembering that this government's objectives are ones that I would have thought a responsible opposition would be supporting, because they are to deliver sound, safe air safety regulations; to ensure that the system is working; to ensure that it is monitored constantly; that it is transparent, accountable and flexible; and that, when change is needed, we have the courage to respond and to change. That is the charter of the government. (Time expired)10000DEPUTY SPEAKERMr DEPUTY SPEAKER (Mr Jenkins)—Order! The discussion is now concluded.Miscellaneous1747Motion (by Mr Ronaldson)—by leave—agreed to:That the following bills be referred to the Main Committee for consideration: Aboriginal Land Rights (Northern Territory) Amendment Bill (No. 1) 1998 National Environment Protection Measures (Implementation) Bill 1997 [1998] Committees174717471747Motion (by Mr Tuckey)—by leave—agreed to:That Mr Ronaldson be appointed as a member of the Standing Committee on Legal and Constitutional Affairs.17471747Motion (by Mr Tuckey)—by leave—agreed to: That Mrs J.I. Bishop be appointed as a member of the Parliamentary Joint Committee on Corporations and Securities.17471747Mr DEPUTY SPEAKERMr DEPUTY SPEAKER (Mr Jenkins)10000PON/A10—Mr Speaker has received a message from the Senate acquainting the House of the appointment of senators to certain joint committees. Copies of the message are on the chamber table and details will be recorded in the Votes and Proceedings .QI4PRICEMr Price—I note that the Joint Foreign Affairs, Defence and Trade Committee is not included in that message. I was wondering whether you might have an explanation for the House.10000Mr DEPUTY SPEAKERMr DEPUTY SPEAKER—The chair does not have an explanation. The message from the Senate has been tabled, with the memberships that have been transmitted by the Senate.Bills1747r6001747Bill returned from the Senate with amendments.Ordered that the amendments be taken into consideration at the next sitting.Bills1747Messages from the Governor-General reported informing the House of assent to the following bills: States Grants (General Purposes) Amendment Bill 1998 States Grants (Primary and Secondary Education Assistance) Amendment Bill 1998 Film Licensed Investment Company Bill 1998 Taxation Laws Amendment (Film Licensed Investment Company) Bill 1998 Higher Education Funding Amendment Bill 1998 Bills1748s1871748Bill received from the Senate, and read a first time.Ordered that the second reading be made an order of the day for the next sitting.Bills1748s1881748Bill received from the Senate, and read a first time.Ordered that the second reading be made an order of the day for the next sitting.Bills1748r703Billsr658Billsr667Billsr666Billsr702Billsr699Billsr698Billsr657Billsr697Billsr665Billsr701Billsr663Billsr659Billsr700Billsr664Billsr660BillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBills1748Debate resumed.16:19:001748Causley, Ian, MPMr CAUSLEY4K6PageNP10—I realise that time has been curtailed in this debate and I will not be too long, but I want to make two or three more important points. It seems to me that in the debate that has ensued one of the great points that has been missed almost completely by the opposition—I have not heard anyone mention it—relates to the taxes that are going to be removed from industry, and particularly rural industry. The opposition do not seem to understand that one of the decisions they took some years ago to enter into competition policy means that Australian businesses, whether they be manufacturing businesses or rural businesses, have one hand tied behind their back. They are being told that they must compete on the world market, yet embedded in all their costs are wholesale taxes, and particularly fuel taxes. The minister at the table would know full well about that, because he has raised it on many occasions in this House.One of the big things about this tax package, if you can get your mind past the GST, is the fact that these other benefits accrue. It makes it a lot easier for business and for exporters to compete on the world market. It is a point that I think the opposition could well look very closely at.In the fuel area, one of the big areas is mining. I am amazed that the members for Hunter, Capricornia and Paterson could sit on the opposite side and oppose a reduction in the cost of fuel to the mining industry, which is one of the great industries in this country. In fact, if you look closely at exports, mining probably brings in about 50 per cent of our export income and agriculture accounts for about 28 per cent of our export income, so mining is the major area of income for the country. Yet those members who represent big mining interests are prepared to vote to ensure that their industries are going to be crippled by continuing taxes. It is something that they should think very carefully about.Finally, I want to put to rest some of the myths that have been floated around here this morning. I heard the member for Batman and the member for Watson talking about America not having a GST. I must have visited a country that was quite strange when I was over there a few years ago, because it was very clear, on the bills I received from the hotels I stayed at, that there was a GST. It was a state GST or VAT or whatever tax it might be called, but it was there. So, while there might not be a national tax, there certainly is a state tax. It is the same in Canada. I think we need to put that myth to bed if they are going to peddle that around this parliament. I thank the House for its indulgence.16:22:001749Price, Roger, MPMr PRICEQI4ChifleyALP00—I very much appreciate being given the call, Mr Deputy Speaker. There is no doubt that in the electorate of Chifley, like in the rest of Australia, the GST was the focus of our election campaign. I am very privileged to have received the support and encouragement of our party members and volunteers. In particular, I wanted to name a few of them who really made a tremendous contribution: my campaign director, Tom Kenny, Jim Maynard, Cath and George Young, Vince and Gwen Grinham, Andrew Rylewski and Sumalya Chakraboorti. They were tremendous in the office and in helping us in our campaign on the GST.Campaigns are usually about two alternative party manifestos and you are out there trying to sell and plug away at it. But the 1998 campaign, like the one in 1993, was very different. The cornerstone of the government's policy was the GST and it was pushed to the Australian people. I was very disappointed to see what was basically the corrupt misuse of $17 million of taxpayer funds to promote a community education program about the tax package and particularly about the GST. On the Labor side we were very much opposed to a GST and we did have an alternative plan.In terms of mandates, a lot of people have concentrated on the fact that the government won the election in the House of Representatives—not with a clear majority of voters, but undoubtedly they won the election—and have then concentrated on the issue of whether or not the Senate has a mandate as a result of the election. I do not want to reflect on those arguments. However, as a Labor member I fundamentally believe that governments, whether they be conservative or Labor, should be allowed to get on and govern. That is why I think this election was so unusual in the sense that we on the Labor side specifically campaigned against the GST as we did in 1993. That is why I have no difficulty saying to my electorate, `Thank you for your tremendous support.' There was absolutely no doubt in the electorate of Chifley where I stood on the GST. Now that the people of Australia have made their decision in the election, I will still be voting against this particular measure.Why am I opposed to a GST? I know that the Liberals have previously used the argument about the 1985 tax summit. I would like to place on record that we probably have to go back to the Second World War to find a contribution by a federal Treasurer similar to that of Paul Keating's in fundamentally changing the economy the way he did in his period as Treasurer. In 1985 we had the summit and quite a number of proposals were put to it. At the end of the day a GST was not adopted, so a GST has never been part of the Labor Party's policy platform. Clearly we believe that if there were an appropriate opportunity or need to introduce a GST, that need has long gone.Of the electorates throughout Australia, mine is one that is going to be very savagely hit by the impact of a GST. I particularly regret the impact on older Australians. After all, they have worked all their lives and in many cases they have contributed to the national welfare fund for their pension. They are now in retirement. They have actually paid income tax on whatever savings they have made or assets they have accumulated over their lifetime of contribution. Part of the proposal for the introduction of a GST is to lower income tax but increase the cost of consumables. Clearly, if there is a group of people who are going to be losers from a GST it is the elderly. I particularly value and esteem my senior citizens in my electorate of Chifley.I also have many battling families in the electorate of Chifley. It is nice to have theoretical arguments about discretionary dollars, but by and large my constituents—whether they are buying their first home, renting privately or in a housing department home—spend their last dollar of income every week or fortnight that they receive it just on living. So if you are introducing a consumption tax like a GST then you are hitting them.Whilst Treasury has modelled long-run inflationary impacts of the GST, it is not clear from Treasury what the short-run impacts are going to be. There is also some question about whether the percentage they have indicated as the long-run inflationary impact is realistic. In the future we will have an opportunity to evaluate that point. I suspect we will be reminding coalition members of that point in the future.You would never guess, listening to the constantly repeated rhetoric in question time, that either the Prime Minister or the Treasurer had ever uttered in their whole lives a derogatory remark about a GST. But John Howard said this on the Channel 9 Today program in January:People get the idea that it's the economic elixir of Australia . . . I don't think people should make the mistake of imagining that a dramatic change to the tax system is going, of itself, to transform the economy—or his `never ever' statement. In 1996 Peter Costello said:I pushed the GST . . . (but) I honestly think now it's receded from consciousness, it's being invested with some snake-oil qualities.I suspect that those statements made by the Prime Minister and the Treasurer are both as equally valid today as when they were made. They have undergone some tremendous transmogrification of their views, but they have never adequately rebutted what is on the public record.Indeed, I notice the honourable member for Page is talking about the export benefits of a GST. There is no doubt that there will be some benefits, but the best estimate is about a one per cent difference. Changes in terms of trade or changes in the currency have delivered far more to exporters than that benefit.I understand a lot of Australia's exports are price competitive, but the really big difference that we have made is to broaden the range of goods and services that are being exported and, increasingly, they are not as sensitive to price fluctuations as they once were. Even in commodities—even in agriculture—we are value adding our products and congratulations go to the sector for doing it, but when you value add, you add a premium and the product itself becomes less price sensitive if you are marketing it well. I am not saying price is of no concern, Mr Deputy Speaker, but you really cannot get very excited about a one per cent change to prices through a GST.A GST will not create any jobs. It is not a solution to job creation. I cannot say to you, Mr Deputy Speaker—nor can a coalition member say—that the day after we introduce a GST we will see an explosion of jobs in Chifley or in any other electorate. The policy settings needed to create jobs are very different: we need to support Australian industry and innovation and we need to have a skilled work force. These issues are far more important to me.For example—just to quote one figure—35½ per cent of people in my electorate left school at 15 years of age or under. This places them at an enormous disadvantage in the labour market. But I say they are intrinsically, as Australians, very worthwhile people. I would like to see this country investing in these people—investing in skills, training and education—and allowing them, through the skills that they acquire, to compete in the labour market and have a rapidly growing economy. The GST is not going to do one jot to change that equation in the electorate of Chifley.Because we are all on limited time, I will conclude on my next point, although there is a lot more I wanted to say. A GST is not going to fix up the black economy. One of the examples I like to quote is that of a mate of mine, Peter Baxter, who is a plasterer. He works in a partnership, but if he decides to work two days a week for himself and has a revenue of less than $50,000, he is not subjected to the GST. This is not illegal, but here is a clear way small businesspeople can legitimately minimise the impact of the GST. There is absolutely no overseas experience that members opposite can quote which suggests that a GST is going to close off the black market economy or tax avoidance. In fact, when you go from 75,000 people who submit wholesale sales tax returns to—I think—about 1.4 million, there are going to be great opportunities for this.16:35:001751Southcott, Andrew, MPDr SOUTHCOTTTK6BoothbyLP10—It is a great honour to be able to speak on this bill which is the most far-reaching tax legislation introduced into this House for at least 60 years.There is no doubt that the subject of tax reform was the major issue in the last election campaign. It should not have been. There is no reason why tax should be the subject of partisan political debate. The reason it was is that the ALP was completely unable to recognise the changes that have occurred in the Australian economy—the increase in services and the decline in goods as a percentage of the economy. So they remain committed to retaining a 1930s-style tax system which puts us in the same league as countries which retain the wholesale sales tax like the Solomon Islands, Swaziland and Pakistan.Since the parliament has resumed after the election, we have heard three weeks of ques tion time and debate about our new tax system which has essentially focused on which areas are being zero rated and exempted and so on, but has completely ignored the fact that the Australian Labor Party has opposed tax reform at every stage of the game. We have been discussing it for over two years now and they have opposed it at every stage. The Australian Labor Party is now defined by what it opposes. When I read the Australian Financial Review today I found that it is 15 years to the day that the Australian dollar was floated. We should think back to an earlier time when the Australian Labor Party actually believed in economic reform and had economic ideas.During the period of the Hawke government, they had reforms to the financial system, reforms to protection and even tentative reforms to the labour market which did improve the efficiency of the economy. We now see a Labor opposition that is acting almost as if the Hawke-Keating governments never occurred. It is retreating to a much older style Labor. We need to ask: what is the overriding principle behind Labor's opposition to the GST? If Labor are opposed to the GST, that means they are standing firmly in favour of higher income tax and firmly in favour of the old style 1930s wholesale sales tax.Listening to some of the speeches in the address-in-reply debate and the speeches in this debate, it is quite clear that the Labor Party do not understand the current tax system that they are seeking to defend, which is their system. There is no high principle involved in Labor's opposition to tax reform. It is brazen political opportunism. We have seen that demonstrated by the fact that there are members of the Labor Party who, when they leave the parliament or the service of the Labor Party, support tax reform.There are members of the Labor Party who used to support tax reform. Gary Johns—who was a minister in the Keating government, who was elected in 1993 and who opposed tax reform—has now said tax reform is essential and any right-minded government member would not oppose it. Bob Hogg, who ran the campaign against the coalition in 1993, has been helping to advise on the advertisements for tax reform. In The End of Certainty Paul Kelly has revealed that, apart from Paul Keating and Bob Hawke who supported the broad based 12½ per cent consumption tax, the strongest supporters in the cabinet were the Leader of the Opposition, the former Deputy Leader of the Opposition and Senator Susan Ryan.In fact, income tax now is raising much more of the tax share than it was in 1985. The amount that we are raising from indirect tax, consumption style taxes, is much less. In 1985 the ALP introduced biscuits, ice-cream and savouries into the wholesale sales tax net and they gave no compensation. In 1993 they increased all the wholesale sales tax rates and they gave no compensation. They increased the excise on petrol, alcohol and tobacco. They gave no compensation. They also increased the sales tax on cars from 15 to 22 per cent—again no compensation.When we were elected in 1996, the ALP had left the equivalent of an 8.1 per cent GST with food zero rated or a 6.7 per cent GST which taxes food, so that is not a huge difference. We are talking about Labor's seven per cent GST versus our 10 per cent GST. We are talking about Labor's tax on goods and services, which is quite inefficient, versus our tax on goods and services, which helps businesses, exports and so on. In fact, when the Labor Party left office in 1996, the changes that they had made during their last three years were raising an extra $3 billion every year. That was having a huge impact on exports.The wholesale sales tax is very complicated. We saw that last month with the Federal Court decision on frozen yoghurt. Essentially, they have said that yoghurt is tax free and that ice-cream is taxed at 12 per cent. Frozen yoghurt was a difficult case. It had been going for many years. They have decided that, if it tastes like yoghurt and if it has the acidic nature of yoghurt—so you have to measure the pH of the yoghurt—it will be tax free. If it tastes like ice-cream, it will have a 12 per cent wholesale sales tax. These are the differential rates that the ALP want to keep. The real winners under this are lawyers who have a big indirect tax practice.Sometimes people talk about exempting food. It is ironic that the Australian Democrats, who have talked about exempting food, are the same party who say that our private health rebates should be means-tested because that would be giving a tax rebate to people on higher incomes. If you exempt food, the benefit goes much more to people on higher incomes than people on lower incomes. The top 20 per cent benefit almost three times as much, in gross terms, as people in the bottom 20 per cent.With regard to a next tax system, the important principles of any tax system are that we should have simplicity, efficiency and equity. Overall our tax changes will see $4 billion less being raised by the Commonwealth. The income tax scales that we will have from 1 July 2000 will be more progressive; that is, the top 20 per cent of incomes will pay more of the burden of income tax and the bottom 20 per cent of incomes will pay less of the income tax.Indirect tax reform will also address the cash economy and will increase the incentives to save, work, export and invest. By having more productive investment, and by lowering business costs by $10½ billion and export costs by $4½ billion, you can get higher growth and better export performances. I do not think the Labor Party dispute this. They do agree that there are benefits from indirect tax reform; they say they are not as big as we say.Looking at some of the studies, a 1998 study by the Melbourne institute and the Brotherhood of St Laurence found that indirect tax reform could increase GDP by 3¾ per cent over the long term, and that has an impact on creating more jobs. Salomon Smith Barne Stockbrokers found that GDP would increase two per cent over the long term. Morgan Stockbrokers estimated that, just by having a GST and reforming the indirect tax system, you could create 200,000 jobs in the long term. An OECD study in 1988 found the same.We are not here to praise the wholesale sales tax; we are here to bury it. We are here to inter the wholesale sales tax. The Labor Party is standing determined to defend it. Not all the Labor members actually understand the wholesale sales tax. It falls very heavily on goods and on manufacturers. Watches, clocks, cameras, video-recorders, tape recorders, radios and televisions are all taxed at 32 per cent. The wholesale sales tax exemption falls on things like horseshoes and horseshoe nails, food for non-domestic birds and toluol. So, if you have polo ponies, the horseshoes and the nails are tax exempt. If you are breeding pheasants—non-domestic birds—to shoot them on your farm, the food for them is tax exempt.Clothing is tax exempt, but that extends to things like Armani ties. To highlight how old this legislation is, the old legislation, which was only changed in the last couple of years, talked about the clothes that were tax exempt, including such things as jabots—which judges wear—snoods and spats. I am not sure how many people still wear these clothes, but they were actually listed there.In terms of how far the exemption goes for clothing, in 1982 the Administrative Appeals Tribunal was asked in relation to customs tariffs to consider whether Spiderman and Incredible Hulk outfits were toys or outer garments. If they were toys, they would attract a 32 per cent wholesale sales tax; if they were outer garments, they would be tax exempt. The AAT found that these were fun garments but that they could nevertheless be described as articles of clothing. The tribunal held that, because of the total effect which the outfits enabled the wearer to present to the outside world, they were properly classified as outer garments and not as toys. So we have a system where Incredible Hulk and Spiderman outfits are wholesale sales tax exempt. That is the system that the Labor Party will be voting to retain.We have a system where sinks are taxed at 12 per cent but the pipes leading to those sinks are not taxed. Soft drinks are taxed at 22 per cent but cordial is taxed at 12 per cent. Pet food is taxed at 22 per cent but if someone goes to the butcher and gets a nice prepared meal for their dog the food is tax exempt. Wedding rings are exempt but engagement rings are taxed at 32 per cent. As I have said before, confectionery, biscuits, savoury snacks and ice-cream goods are taxed at 12 per cent.The Labor Party look as though they have set the pattern for the next three years. They do not know what they believe in. The tax policy that they took to the last election was a joke. I feel somehow that the Labor Party believe that the last election was like the 1969 one—that was the election where they gained a lot of seats—and that in a subsequent election they will gain more seats and be in government. The Leader of the House was right on election night when he said that it was more like 1984, in that the Labor Party has not done the work in order to work out what their policies should be and what they really believe in. They need to do a lot more work to present viable policies to the Australian people in order to have any hope of getting elected in the future.16:47:001753Hollis, Colin, MPMr HOLLISDH4ThrosbyALP00—As usual, that was a fascinating speech from the member for Boothby about the ALP. I was quite puzzled. He spent most of his speech talking about the ALP, and that indicates the poverty of ideas on that side of the House. You do not have to worry about the ALP. If I were you, I would be more concerned about my own party on that side and its paucity of ideas. Those on that side come in here with the same old arguments parroted out each time, over and over again. If we were going to have an interesting debate on this, one would think there would be a few new ideas thrown in.The GST bills before the House are supposed to herald, as we were all told during the last election campaign, the most fundamental tax change since Federation. If this is so, one would have thought that, given the significance of the tax changes being proposed, the government would have allowed an equally significant period in which to have the package fully debated.We are all here talking with a limited amount of time, and many people are not even going to get the opportunity to speak in this debate. We have been allocated less than 18 hours—and this is from the government that was going to lift the debating and other standards in this chamber. Here, by their own admission, we have the most fundamental change to the taxation system since Federation being rammed through the House, with very many members of the House not even being given the opportunity to speak and with 18 hours to debate a huge shift in the tax burden from the rich to the poor, from business to the workers.The package of bills will not even come into effect until the year 2000. What therefore is the rush in trying to hammer through this package? We are not permitted to have an open period of debate. Once the package of bills gets punted through this place, it will go before the Senate and a series of Senate committees. The Senate will not even begin consideration of the package until 19 April 1999, so why the rush through this chamber?I can recall the tantrums expressed by some of my colleagues opposite when the Labor government proposed a shift in Australia's identity with the republic. Many of them were afraid that one morning they might wake up to find the Australia they had known completely changed, just by changing the head of state. But Labor never came into this place and dropped a second reading speech, introduced a whole package of bills and then allocated a remarkably short period of time in which to address such an important issue. No; the debate is still taking place, both in this place and in the wider community, as it properly should; but less than 18 hours of debate is totally unacceptable for a package of bills that will affect every Australian, no matter what their age, for the next generation.I do not like to say it, but the Leader of the House should be ensuring that if necessary this place sits again next week so that the debate on the package can continue. There has been much talk about the government's so-called mandate on the GST. Ever since 1996, we seem to have been infested with this endless talk of mandate. The Prime Minister said in this place on 15 September 1987:. . . when people vote at an election they do not vote on only one issue. The mandate theory of politics from the point of view of proper analysis has always been absolutely phoney.It would appear that there is a little more considered thought given to such matters when one sits on the opposition benches! I remember that the Labor Party had a mandate in 1975, but the then opposition did whatever it could—and the present Prime Minister was part of that effort—to deny the Whitlam government its mandate.I have a mandate from the people of Throsby to oppose and vote against the package of bills. On 3 October 1998, after weeks of campaigning, over 42,000 people voted for me and the Labor Party. The Liberal candidate obtained just over 11,000 votes. When the two-party preferred vote is included, I obtained 49,877 votes or 73 per cent, and my Liberal opponent obtained 18,768 votes or just 27 per cent. By that reckoning, I have a mandate to oppose and vote against the GST, and this I will do. All of my colleagues on this side also have the same mandate.During the election campaign I used to hold street stalls at the local Pinkies Market at Warrawong each Saturday morning. My campaign team also held street stalls around the Throsby electorate each Saturday morning. We got the same message from people as they walked out of corner stores with their newspapers, a carton of milk, fruit and vegetables and bread on those Saturday mornings. They did not like the GST. They did not want a GST and they still do not want a GST. The people whom I found were most angry with the GST were those who had escaped this insidious tax from their original homeland. I lost count of the number of people who told me they saw the way the GST operated in the UK and how it just kept going up. I lost count of the number who said to me, `We know all about the GST, Colin.'The government is saying that we do not need to debate the GST because the issue has been around for 20 years. The debate has been around for 20 years, but the views of the Australian people have never wavered. Australians are no mugs when it comes to the hip pocket. Australians know that if this GST is passed, the Treasurer's hand will be in their pocket forever. Everything that is used and everything that is bought will be hit by a 10 per cent new tax. I am convinced that some people still do not realise that services are going to attract a 10 per cent tax. Every haircut, dentist visit, bus ride, train journey, movie ticket, sporting event and wedding ceremony—if it is a civil wedding ceremony—will be taxed at 10 per cent.Australians are aware that the GST is unfair and regressive. They are aware that the more you have, the more you will retain under a GST but the less you have, the more you will be forced to give away. It is simple logic that the low and middle income earners in Australia spend a larger proportion of their wage and salary on the basic necessities of life. The government knows that this is true and the modelling that it consistently refuses to release to the public confirms that this is true.The government appears to forget that we sat on the other side of this place for almost 14 years. We know where the files are and what the computer modelling shows on the GST. Australians also know that the rate of the GST will increase. We are not convinced that the GST can or will be locked in at a 10 per cent rate forever. Australians need only look overseas for the evidence. Particularly people who come here from the United Kingdom and other European countries endlessly reminded me of this fact during the campaign.In the OECD, 21 out of 23 countries have increased the rate of the GST from what it was when the GST was first introduced. Denmark introduced it at 10 per cent; it is now a huge 25 per cent. Similarly, it has increased in New Zealand and in the United Kingdom. The government has put up a ridiculous proposition that it can manage what no other country in the OECD—bar only three countries—with a GST has been able to achieve. The government will seek to lock in the GST rate at 10 per cent by legislation and, if it is to be changed, it will require the agreement of all Australian premiers and the parliaments. As they say about state premiers, they will let nothing stand between them and a bucket of money.We are told that the income tax on the worker will be reduced and that their personal income tax liability will be reduced. I believe that income tax rates could be reduced in the initial period for a couple of years but then they will be increased. Personal income tax will be increased and there will be a GST to boot.As we are under time constraints I will draw my comments to a close. The only other thing I will say is that the government is obviously scared to have a proper debate on this GST. I keep faith with what the people of Throsby voted for me to do in October: I oppose this GST and the package that comes with it.Debate (on motion by Mr Andrews) adjourned.Address in Reply175517551755Mr DEPUTY SPEAKERMr DEPUTY SPEAKER (Mr Nehl)10000PON/A10—I suspend the sitting until 7 p.m. in order that Mr Speaker may present the address-in-reply to His Excellency the Governor-General at Government House. Mr Speaker will be glad if the mover and seconder, together with other honourable members, will accompany him to present the address.Sitting suspended from 4.57 p.m. to 7.00 p.m.10000Mr DEPUTY SPEAKERMr SPEAKER—I inform the House that, accompanied by honourable members, I waited today upon His Excellency the Governor-General at Government House, and presented to him the address-in-reply to His Excellency's Speech on the opening of the first session of the 39th Parliament, agreed to by the House on 9 December.His Excellency was pleased to make the following reply:Mr Speaker,Thank you for your Address in Reply.It will be my pleasure and my duty to convey to Her Majesty The Queen the message of loyalty from the House of Representatives, to which the Address gives expression.Miscellaneous1755175519:01:001755Slipper, Peter, MPMr SLIPPER0V5FisherLP10—by leave—I move:That so much of the standing orders be suspended as would prevent the adjournment debate in the Main Committee on Thursday, 10 December 1998, continuing without interruption until 1.30 p.m.I understand that there have been discussions and that the opposition is in agreement with this course of action.Question resolved in the affirmative.Bills1756Messages received from the Governor-General reported informing the House of assent to the following bill: Data-matching Program (Assistance and Tax) Amendment Bill 1998 (No. 2) Bills1756r703Billsr658Billsr667Billsr666Billsr702Billsr699Billsr698Billsr657Billsr697Billsr665Billsr701Billsr663Billsr659Billsr700Billsr664Billsr660BillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBillsBills1756Debate resumed.19:02:001756Andrews, Kevin, MPMr ANDREWSHK5MenziesLP10—It is sometimes suggested that there is a malaise that comes at the end of a century. We know from history that the big bust followed the boom of the 1880s in Australia, and the question is: does history repeat itself? We know this much at least: we are living in very uncertain times. The tyranny of distance, a concept coined by the Australian historian, Geoffrey Blainey, has been replaced by the concept of a global village. With East Asia in crisis, with Russia mired in debt, and with Japan, our single biggest market, in recession, we have to ask how the West—and Australia in particular—will survive this crisis.Recently, the Chairman of the United States Federal Reserve, Alan Greenspan, told an audience in California:It is just not credible that the United States can remain an oasis of prosperity unaffected by a world that is experiencing greatly increased stress.The global trade that makes us all interdependent and gives us a high standard of living also makes us highly vulnerable, especially as Australia is still heavily reliant on commodities. In this climate, there has been considerable talk of global financial uncertainty. This is probably the most testing time for world peace since the Depression of the 1930s.Walter Russell Mead, a senior fellow at the United States Council on Foreign Relations, recently put it like this:Forget suicide car bombers and Afghan fanatics. It is the financial markets, not the terrorist training camps, that pose the biggest immediate threat to world peace.It is against this background that more than ever we need strong government and policies to make our economy strong. Australia's economy is growing strongly despite the Asian crisis. This is because the government has got the economic fundamentals right and we have a plan to further strengthen and stabilise the economy.Under Labor, we had a high deficit, high interest rates and high taxes. Let us take a quick snapshot of Labor's past record. When the coalition government came to power it found a $10 billion black hole—the national Bankcard debt run up by the Labor government over 13 years. As to its tax record, the Sydney Morning Herald made this comment in an editorial on 28 August this year:Labor's credibility on tax is woeful . . . the party has broken promises (remember L.A.W.). Mr Beazley expects everyone to forget the past and to believe that his tax package is genuine tax reform rather than a massive tax bribe.Instead of reforming the tax system, hidden taxes such as wholesale sales tax were progressively bumped up by the Labor government without any fanfare, and they now stand at an average of 22 per cent. Consider the Labor Party's record on indirect taxes during the period since 1983. One could spend the whole of this debate running through the items that have had an increase in the wholesale sales tax.Let us take a few examples. In 1983, the wholesale sales tax on matches went from nought to 12 per cent; on baking powder, cream of tartar and bicarbonate of soda for use for other than culinary purposes from nought to 22 per cent; on toilet preparations from nought to 22 per cent; on household disinfectants, sterilising solutions, combined disinfectants and sterilising solutions from nought to 22 per cent; on oils, greases and lubricants for use for business or industrial purposes from nought to 22 per cent; and on cosmetics, including sunscreen agents, from nought to 22 per cent.In 1985, the wholesale sales tax on biscuits, ice-cream and similar products and snack foods went from nought to 12 per cent; on packaged flavoured milk, non-alcoholic wine and cider and similar beverages from nought to 12 per cent; and on Australian fruit juice products from nought to 12 per cent. In 1986, the wholesale sales tax on non-alcoholic and low alcoholic beverages went from nought to 12 per cent. In 1988 the tax on muesli bars and other health food bars went from nought to 22 per cent. One could give similar figures for the whole term that Labor was in government.In addition, under Labor, interest rates rose to 18 per cent and to over 20 per cent for businesses and, as we know, thousands of businesses went bust as a result. Under Labor, unemployment went up to 11 per cent. In the recent election, Labor offered no plan—only a few promises which failed to benefit a large part of the community. For example, it offered some tax relief to families earning in total no more than $40,000. Households—we are not talking about individuals—that have collective earnings of $50,000 would have got nothing from Labor under its proposals in the recent election.Labor's version of tax relief failed to take account of the reality of the dual income family. That family earns in total an average of $60,000 in Australia, but Labor ignored it. Consider what has happened to families and taxation over the past few decades. It has been estimated that by the early 1990s a family paid 2¾ times the tax that was paid in 1966-67, while the single person paid 1⅔ times as much. According to Dr Alan Tapper, in his study The Family in the Welfare State, between 1960 and 1990 the effective tax rate on individuals rose by 83 per cent, but the effective tax rate on families rose by 360 per cent. The effective tax rate takes into account both taxation and benefits. Even a decade ago Dr Don Edgar, when director of the Australian Institute of Family Studies, said:. . . a one income family with two children required an income of $42,900 a year in order to have the same standard of living as a single male on average yearly earnings of $24,000.The tax reform proposed in these bills and by the coalition will benefit families on average weekly earnings. For example, a single income couple on $35,000 with two dependent children at school will be $54.47 a week better off, even after taking into account the GST.There are other provisions in this legislation which benefit families. For example, under the family tax initiative there is a doubling of the extra $1,000 tax-free threshold for each dependent child to $2,000, which is the equivalent of $140 per year per child and a 70 per cent increase in assistance. There is a doubling of the extra $2,500 tax-free threshold for one-income families with a dependent child under the age of five to $5,000, equivalent to $350 a year and a 70 per cent increase in assistance. There are increases to the maximum assistance for child care for lower income families by $7.50 a week. There is removal of poverty traps by increasing the level of income at which the family allowance begins to become income tested from $24,350 at present to $28,200 and by easing the withdrawal rate from 50 per cent down to 30 per cent. There is the simplifying of 12 family assistance payments into three and having them delivered through a single office, a new families assistance office. These are measures which are contained in some of the bills before the House at the present time.Tax reform is required for three important reasons. The first is that our tax base is shrinking and we need to find more money to pay for the social services that we have come to consider the hallmark of civilised society. We in this country are going to need to maintain hospitals, we are going to need to maintain our schools and education system and we are going to need to maintain the facilities for the elderly. I heard the Leader of the Opposition, in his contribution to this debate, talking about nursing homes. We are going to need to meet the demand for nursing homes in the future with an ageing population in this country, given the fact that they have been allowed to run down in many places, and no doubt all of us as local members could point to such examples.The reality is that, if we want to maintain these services, which Australians want as part of a civilised society in this country, we have two choices. We can either borrow into the future, as Labor did for over a decade, thrusting the liability forward onto future generations, or we can broaden the tax base in this country to provide for the services that we aspire to as a community. This has been acknowledged even by a former Keating minister, Gary Johns, who wrote these words in a newspaper article recently:The plan to change Australia's tax system is the only way to maintain a solid revenue base to fund the services that government provide to the needy.That is the reality facing this parliament and facing the Australian people. Either we can provide for those services which we demand and increasingly are demanded by providing an increasingly broad tax base in terms of review for the Commonwealth, or we can borrow into the future. I suppose the other alternative is to increasingly target those things so that in the future more and more Australians will not be able to have what has been regarded by past generations as part and parcel of a civilised society. Even ACOSS has conceded that the taxation system is in need of substantial reform.The second point is that, because of tax creep, we are rapidly approaching the situation where someone on average weekly earnings will be paying the top marginal rate because inflation has gradually pushed their salary up. This is best illustrated by the comparison of average weekly earnings and the top marginal rate of taxation. In 1954 in Australia you had to be earning 19 times average weekly earnings in order to attract the top marginal rate of tax. Today it is 1.2 times average weekly earnings and, if this trend continues, within a year or so you will be paying the top marginal rate of tax in Australia on average weekly earnings. If we want to address that problem then we also have to broaden the tax base.I will restrict my remarks because of time constraints. We have a ramshackle taxation system, which has been conceded by almost everybody who has objectively looked at this. I just take one quote from the Institute of Chartered Accountants in Australia some time ago, when they answered the question of whether we need tax reform with the following words:Yes, we need tax reform because our present system is in desperate need of repair. It is beyond minor repair. It needs wholesale reform. Taxes should be fair, efficient, certain and simple to administer, but the present system is totally inadequate for the economy and the challenges of modern living and business. Even organisations from the business and welfare lobbies and politics that may be expected to oppose such change agree that tax reform is a priority.They go on to give examples.In conclusion, this is not a choice between what we have now and what is being proposed in these bills before the parliament. It is not a choice between the current system and what is being proposed by the coalition. The reality is that, no matter who is in government, tax reform is a necessity. Changes to the tax base are necessary, as the Labor Party proved after the 1993 election. They were not able to fulfil their promises. They had to turn around and change the tax system. For the last 13 years of Labor government they made changes to increase the tax base by broadening and increasing the wholesale sales tax.This is not a choice between what we have now and what is being proposed. It is a choice between what is honestly being proposed to the Australian people and what we would not have known about had Labor been in government. There are no other proposals credibly before this parliament. There is nothing but criticism coming from the Labor Party. These are measures which were taken openly to the Australian people in what could only be regarded as a major political risk for the coalition, and the Australian people voted the coalition back into government. I urge all honourable members to support these bills.19:15:001759Martin, Stephen, MPMr MARTIN8I4CunninghamALP00—In his contribution to the debate on A New Tax System (Goods and Services Tax) Bill 1998, the honourable member for Menzies talked about a tax honestly being proposed. The GST is the tax that the Prime Minister said would `never ever' be part of the tax agenda of his party in government or out of government again. This is the tax which the government said was off the agenda for all time within the Liberals. If that is an honest approach to the people of Australia—they should have and probably could have taken him at his word when he was in opposition—then one wonders why we are actually here tonight debating the issue.I say to the honourable member for Menzies: we also have long memories in this place. It is an absolute nonsense to suggest that in government Labor did nothing to try to remedy problems within the tax system. Those of us that came into this place some time ago will remember that Labor in government reduced the top marginal tax rate, which we inherited, from 60 cents in the dollar down to 47 cents in the dollar. It was a government that also reduced the bottom marginal tax rate, which we inherited from the Prime Minister when he was Treasurer in the Fraser government, of 30 cents in the dollar down to 20 cents in the dollar. Where was the equity then? Where was the equity in taxation when Mr Howard was the Treasurer of this country?DK6HOCKEYMr Hockey—What about FBT?8I4Martin, Stephen, MPMr MARTIN—The Minister for Financial Services and Regulation says, `What about FBT?' It is true that FBT and capital gains tax were introduced by a Labor government. It was also a Labor government which introduced a crackdown on tax avoidance offshore. It was also a Labor government which fixed the marginal rates, put imputation in place for business so that there were no double taxation arrangements, fixed tax avoidance and provided funds to families through family allowances and family allowance supplements and so on, so that the most disadvantaged in our community could have an income around $25,000 to $26,000 at least without any tax being paid. After all this, is this the criticism that is levelled at Labor for its approach to taxation matters?Yet here we have a government proposing to introduce a tax which is blatantly unfair—again—a tax which they previously said they would not introduce, and a tax that is hidden. And just on that point: it was drawn out yet again today in question time from the Treasurer. One of the big criticisms that he and the government level at the wholesale sales tax regime is that the tax is embedded in the price that people pay for goods where the sales tax is actually applied. Yet in the same breath he indicated that the GST is going to be embedded in the final price as well. It is not going to be signalled as to what it is. Where is the honesty and the integrity in saying that this separate system now being proposed under the GST is going to be fairer in that it indicates that this tax applies?The honourable minister knows, he goes to McDonald's like all of us, that those tax machines—the registers—are there and they are already geared up for tax. They are already geared up so that if you go and buy your Big Mac, your Coke and your fries, they can punch that in and then they can punch the other button and the tax will be added on and you would see it.The government, on the other hand, says, `No, we're not going to do that; we're going to hide it. We're going to hide that away.' Then they say, of course, that it is 10 per cent. But when you go to this legislation and try to find the section in it that says the rate is going to be fixed at 10 per cent, you cannot find it. All you can see in the objectives to the bill is a reference to the fact that there is going to be a GST rate of 10 per cent. It is in the objectives, not in the legislation. As a consequence, the government has paraded itself around and said, `We will say to the states that we will give them all the proceeds of the GST, and it is only going to be if they all decide that they want to change the rate that we will have to do it.'I say this to you, Mr Deputy Speaker: you and I both celebrated 14 years in this place last Tuesday.DK6HOCKEYMr Hockey—Fourteen years!10000DEPUTY SPEAKERMr DEPUTY SPEAKER (Mr Nehl)—Yes.8I4Martin, Stephen, MPMr MARTIN—And you would know, as I would know, that when it comes to state governments, who regularly come down here asking for funding to supplement whatever the federal government has given them, there is always a blue—in the Australian colloquium. As a consequence, I can just imagine now, the first time that any of the grants to the state governments are cut back—it will not matter what persuasion the political party in government—they will all put their hands up and say, `Righto, it's time,' and up goes the GST rate. The letters will be written off. They will be faxed down to the Prime Minister, and the Treasurer of the day will be bringing in a regulation or a bill, or whatever is going to be required—we still do not know—and up goes the GST rate. History will show you that in every OECD country where the GST has been applied it has gone up.I also find interesting that one of the things that, for example, our friend the member for Menzies puts some stock in—and I know the Prime Minister does—is the concern that is there for families and this issue about fairness. Well I ask this genuinely of the minister across the table; he is one of the better people on that side: if you are applying tax, why do you then want to apply a tax on items for families where it does not exist now—on food, clothing and shoes? Why do that?Do you genuinely believe that people out there in the community are going to throw their hands up and say, `Hallelujah! Thank goodness for this government. They have promised us a bit of a tax cut over here, but they are going to put a 10 per cent GST on the necessities of life'? The government is going to put a 10 per cent GST on kids going to school, with their school uniforms, their school shoes, their school bags and the cut lunches at the canteens—all those sorts of things.0V5SLIPPERMr Slipper—They will be better off.8I4Martin, Stephen, MPMr MARTIN—Even the member for Fisher up there on the Sunshine Coast would find that some of his constituents would rail at the thought of that. They would ask, `Where is the fairness in that?' The Treasurer has come in here and said, `Look, the inflation effect on this proposal is going to be 1.9 per cent.' If anybody believes that, they believe literally in fairies. Because the effect that is going to be felt here in an inflation sense is one that is going to be much more than that 1.9 per cent based on whatever modelling anybody wants to throw up.I also say that a concern we would have, as we have outlined here, is with the inconsistencies that have already been identified. Some of the things are just absolutely absurd. The fact that if you are going to get married in a church, you do not pay GST; if you have a civil celebrant, you are going to pay a GST. What sort of an argument is that to be running in this day and age? You talk about the tourists coming here from overseas and the domestic tourists. Domestic tourists are going to be hit with the GST, international tourists are not.DK6HOCKEYMr Hockey—So they should.8I4Martin, Stephen, MPMr MARTIN—Where is the consistency in that? The minister at the table says, `So should domestic tourists.' People like him and me and our constituents in Wollongong and North Sydney should be hit with a GST, but international tourists should not. I find that a strange argument. I also say to the minister that the Leader of the Opposition clearly demonstrated this afternoon the farcical circumstance involving people in nursing homes. He talked about the two streams of people in nursing homes—those that will be subject to the GST and those will not.Mr Deputy Speaker, as you are aware, in the last parliament I was Labor spokesperson on small business, tourism and sport. There were genuine concerns expressed within those sectors of the economy about the effect of a GST—there were real worries about it. None of those worries have been assuaged by any of what this government has done—not one. Whether it be tourism or small business, the fact is that you will have to have computers, computer programs and so on to offset the massive amount of time that is going to be required for the record keeping associated with the GST. It is a genuine and a real problem for small businesses, as well as for microbusinesses that the Leader of the Opposition spoke about this afternoon.The minister knows himself that the fastest growing sector of the small business community are the microbusinesses—they do not employ anybody; they work from home. That is about 50 per cent of small businesses now. There are going to be additional hours of work placed on them to keep all the records. Whether they have the computer program or not, they will still be inputting that data so that records can be kept so they can apply for GST rebates or whatever—or just so they can work out what they are going to have to send to the tax commissioner.The other insidious issue associated with this relates to the fact that, during the course of the election campaign, we saw some $17 million of taxpayers' money—8T4FERGUSONMr Laurie Ferguson—It was $19½ million.8I4Martin, Stephen, MPMr MARTIN—My colleague the member for Reid says it was $19½ million. It cost $19½ million of taxpayers' money to virtually put the `yes' campaign for what was seen by the government as a referendum on the GST, and that amount was matched by $10 million from the business community even before the election campaign started. Where is the fairness in that? How can I say to my constituents in Wollongong that there is going to be justice and fairness and equity with the imposition of a GST?My final point goes to the nonsensical argument that has been raised about the mandate theory of politics, and how this government have been given a mandate to implement their tax change. There was an eight per cent swing to me in this election from people who said they do not want a GST—69 per cent of my constituents in Wollongong told me `No GST' and told me to come down here and to stand up and be counted. Mr Deputy Speaker, I am doing just that.19:27:001761Lieberman, Lou, MPMr LIEBERMANXU5IndiLP10—I am very proud to be associated with this legislation introducing a new tax system for Australia. It is long overdue and it is most important that we get it through. Having heard the member for Cunningham, it is no wonder that the Australian people have rejected Labor as their government for the next three years.DK6HOCKEYMr Hockey—Comprehensively!XU5Lieberman, Lou, MPMr LIEBERMAN—Absolutely comprehensively! We have an authority from the people of Australia, after a difficult and tough election campaign, to proceed with the new tax system, which was clearly set out for the people of Australia to examine and debate amongst themselves and to vote accordingly. Is it any wonder that the electorate of the member for Cunningham voted in the way they did—having heard his speech, the lack of depth, the scare campaign associated with it and the rhetoric but without any proper analysis of what the proposals were? Is it any wonder?What the member for Cunningham does not realise is that, since the election, there has been a ratification—an overwhelming development—by the Australian people that they want this government to be able to proceed with the legislation on the tax reform, the health rebate and all associated things. I suggest that the Australian people will exact a very strong penalty against the Labor Party and other members of the parliament—in the Senate and the House of Representatives—who attempt to frustrate the government's urgent mission to introduce this long overdue tax reform.All the members in this House know that more than 70 per cent of Australians want tax reform, and they want it done properly and comprehensively. Let me just encapsulate a few principles. The coalition will be reducing personal income tax rates for most Australians and particularly for the low income and middle income people of Australia. The Labor Party, and others associated with the Labor Party, are going to try to stop that—let us make that clear.The second point is that the coalition will remove forever the wholesale sales tax, with all of its quirks, anomalies, nonsense and inequity. The Labor Party and those associated with it will fight to retain and continue to impose those anomalies and that stupid tax on the Australian people. That is clear. We know also that they want to stop the rebate on private insurance, which will have disastrous consequences.Debate interrupted; adjournment proposed and negatived.XU5Lieberman, Lou, MPMr LIEBERMAN—We know that the consequences for Australia's health system, both the private and the public sector, will be diabolical without that tax reform, and it will be on Labor's head. This debate is a very exciting one that clearly defines what the various parties are about and lets the Australian people see the consequences of one or the other prevailing. That is good in a democracy. It is a great thing to see the sharp points of the debate emerging now.The legislation sweeps away an outdated, inefficient tax system that does not serve the nation fairly; and members know in their hearts that I am right in saying that. It will reduce the tax rates for average earners in Australia and do away with the marginal income tax rate of 43c, which Labor has imposed on Australians, plus a Medicare levy of 1.5c. Average earners deserve better, and we will give it to them.The legislation removes other taxes, such as the wholesale sales tax that I have referred to. Under the new Commonwealth-state arrangements, we are removing conveyancing duties in states on business property; stamp duties on marketable properties; debits taxes on bank accounts; stamp duties on leases, mortgages, bonds, debentures and other loan securities as well as on cheques, bills of exchange, and promissory notes; and the bed taxes that apply in some states. The abolition of the wholesale sales tax and other taxes, and the reduction in fuel excise, particularly for diesel fuel, are going to have a tremendous effect.I want to spend the last couple of minutes of my contribution speaking of the regions of Australia that I live and work in. I want to thank the electors of the electorate of Indi, who came up with the result of giving an overwhelming endorsement to the coalition's proposals. It was a difficult debate with a lot of scare campaigning. I am proud of them; I am proud of the way they sorted it out.0V5SLIPPERMr Slipper—What is your margin?XU5Lieberman, Lou, MPMr LIEBERMAN—I am now at about 62 per cent two-party preferred. I am very humbled by that, because it was a very difficult campaign, with nine opponents all putting me virtually last and all playing together in the game of spoiling, of stopping Australia from going ahead. My region of Australia is one of the major exporters of value added food from Australia into other regions. We have a great future, with more to do, more to give, and more to help Australia with jobs and economic growth.The tax reform package is going to reduce taxes on business and on businesses that export from this country. Surely no member of parliament can argue against that principle or the urgent need to achieve that. We must grow our exports because that will strengthen our economy and create real, permanent jobs—especially for our young people. So the fundamentals are all outlined there. Quite frankly, the Labor Party has made a disastrous decision to oppose this legislation regardless of the merit of the arguments. Their leader, Mr Beazley, has put them in a position that they will regret for a very long time.There has been some hand-wringing about the House of Representatives debate being subject to time limits. I will say this: I have been in parliament and politics for a fair while now, as members know. Hand-wringing does not have any justification. Occasionally guillotining does, in a parliamentary system. But here we have the Labor Party, which said on the record, `We will oppose this. Regardless of the Australian people's decision in the election, we will continue to oppose it. We will stop it at all costs.' That is really the people on the other side wringing their hands. This is not a genuine debate from their point of view. They are here to spoil, to stop and hinder and not in any way to have a decent debate in a democracy about the merits of the tax system.That is what we face as we go into the parliamentary break and 1999 with the debate in the Senate and the various inquiries that will unfold. Let me assure the House that people like those who live in Indi, whether they vote Liberal or not, expect the Senate to respect their views and to get out of the way of reforms that will strengthen the economy and create jobs, especially for our young people. We have a responsibility to do that. We have a responsibility to help our farmers, small businesses and manufacturers with their exports. No-one can deny that.You guys over there will go to the Christmas break from this parliament with that on your conscience, knowing full well that you have decided, regardless of the merit of the argument, to oppose and to try to defeat. That is what you have done. As you go into your Christmas holiday basking in whatever you will do with your families—I hope that you have a rest and time to reflect—just remember what you have committed yourselves to doing in your parliamentary career, and that is, hindering the strengthening of Australia's economy, stopping exports and stopping the creation of new permanent jobs. That is your legacy. I wish you a merry Christmas, but I hope you know that what you have committed to is exactly what I just said.19:36:001763Albanese, Anthony, MPMr ALBANESER36GrayndlerALP00—Today I rise in this debate to oppose, as indeed the member for Indi has said, this government's GST proposal. I particularly want to highlight the impact of this proposal on the housing sector and on people, all of whom rely upon housing of one sort or another. Unlike the government, I believe that good quality, affordable housing is a basic social and economic right.I believe that all human beings have a right to decent food, clothing and shelter. In an advanced industrial nation like Australia, this belief translates at a practical level into support for legislative initiatives designed to redistribute wealth and provide access for all to good quality and affordable housing.Unlike the government, however, the Labor Party does not believe that only the wealthy should be able to buy their own home. We do not believe that only the wealthy should be able to live with security, knowing that there will always be a roof over their heads. But, Mr Deputy Speaker, the government, by their actions in introducing this GST with its impact on the housing sector, clearly believe that housing, like other necessities of life, is the preserve of the privileged.The introduction of the GST will ensure that the average Australian home is thousands of dollars more expensive. Anyone pushed out of the housing market by the increased costs of buying a home will find that private rental rates have also soared. And, despite the government's protestations, public housing in no way escapes the impact of a GST. The four per cent compensatory increase in pension will ironically lead to rises in rents for residents of public housing because their rents are directly linked to their income.The great Australian dream has always been to own a suburban brick house surrounded by a quarter acre block. Private ownership of the family home is also socially beneficial in the broader sense. Home ownership provides an important protection for many Australians against poverty in their old age.The introduction of the GST will make home ownership that much more difficult for ordinary Australians. Before the last election, Australia's peak building industry association, the Housing Industry Association—not known for its support for the Australian Labor Party—stated that the government's estimation of a 4.7 per cent increase in the cost of new homes was drastically understated. The real impact, according to the HIA, will be as much as an eight per cent rise in the cost of a new home.The GST will apply to new home building, land development, renovations, additions, repairs and maintenance. During the election campaign, the government attempted to sell the GST to first home buyers by promising $7,000 up front to first home buyers purchasing a house with a construction value of up to $150,000. When you examine the legislation before the House tonight, you find that it does not appear. The reason the scheme does not appear in the legislation is quite simple. The government relies upon the goodwill of the states to introduce this scheme. Its implementation relies upon a belief that they will do the right thing regardless of whether there will be any compensatory factors for them.Questions such as how the states will administer the program, whether the scheme will be uniform across the states, have not been answered. Even with the states' full cooperation the government's First Home Owners Scheme does not adequately insulate first home buyers from the government's imposed hike in housing prices. The Financial Review—again, not a publication noted for its support of the Australian Labor Party—stated, on 15 August 1998, that the First Home Owners Scheme `only compensates for the increase in homes valued up to a less-than-average $90,000'. There is not a home in the Sydney metropolitan area that sells for $90,000. Anyone buying a house valued in excess of this amount will be paying eight per cent more than they would have before the implementation of this unfair GST.To add salt to the wounds, the government has retained stamp duty on residential properties, thus allowing the rise in house prices to force a corresponding rise in the amount of stamp duty which has to be paid. HIA's Managing Director, Ron Silberberg, has estimated that there will be a $400 average increase in house and land packages as a result of this government's GST.For private renters, the news is just as grim. The President of the Real Estate Institute of New South Wales, Mr Stephen Francis, said in the Financial Review on 15 August 1998:As it stands now, rents are not subject to a GST, but what is likely to happen is that costs of the inputs to the owners will go up. They're going to be reliant on passing these costs off to the tenant.I outlined before that maintenance costs—all of these costs—are going to be subject to the GST. Are the people who have invested in housing to gain tax advantages simply going to absorb these costs or are they going to pass them on to the renters? I believe that everyone in this chamber knows that they will be passed on to those in the rental market.Home buyers and private renters will definitely suffer under the GST, but I want now to address the group that the GST will hit hardest—those who are most vulnerable in our society and, in particular, public housing tenants. Public housing rents have been declared by this government to be GST free. However, the government has stubbornly refused to take into account the fact that public housing rents are indexed to pensions. Due to the dramatic decline in capital spending in public housing, public housing is more and more becoming the preserve of those who are on limited fixed incomes, essentially welfare housing. I think that is unfortunate, but it is a fact. The rents of those tenants are directly aligned to their income—between 20 and 25 per cent. Therefore, with regard to any increase in pensions, such as the four per cent compensatory package proposed by the government, 20 to 25 per cent of it will be eaten up immediately by a rise in the rent that those tenants have to pay.The government has also announced that it will not exempt state governments from paying GST on building inputs. Senator Kemp stated, in response to a question from my colleague Senator Chris Evans, that the states would be taxed in the same manner as private residential rents are taxed. When asked how the states would recover the extra capital costs of public housing under the GST, Senator Kemp gave a very interesting reply. It is a reply that exposes just how elitist some senior members of this government are. It is extraordinary, but I put it on the record again:Public housing tenants will have significantly greater disposable income as a result of the government's tax reform policies. It could also be noted that state governments' finances as a whole will benefit substantially from tax reform.In other words, the government is not providing a plan to compensate states for the extra costs associated with public housing. Indeed, state governments will be paying GST when purchasing or maintaining public housing stock. This revenue, it is true, will be returned to the Commonwealth and the Treasury with no guarantee that the money will be reinvested into public housing. Chances are that it will just go into consolidated revenue because, whether it is the Treasury here and the Commonwealth or the Treasury and the states, when they have a chance to absorb revenue they do—and it will again add to the pressure which is on public housing.Senator Kemp's remarks seem to suggest that the GST will mean that public housing tenants will be so wealthy that they will now be able to afford higher rents. It is an extremely callous statement. Low income Australian families will be struggling to survive under a GST. Their day-to-day basic living costs will soar and now the government, as a result of this tax, will see those families' rents increased as well. Senator Kemp says, `They'll be better off.' He is living in Disneyland if he thinks that is the case because, quite simply, working-class Australians in public housing do not have extra affordable income. They will be hit more by the GST because they spend a greater proportion of their disposable income on the essentials of everyday life: on food, on clothing and now on shelter; at each and every level those things will be hit by this callous government.I also want to talk about the impact this GST will have on the construction industry by dampening growth in the housing sector. This is an industry in which over 600,000 Australians are currently employed. The Housing Industry Association, a body which has never supported the Australian Labor Party, predict the increased cost in construction and materials will mean that there will be a construction boom before the GST comes into force. So you have got this massive distortion of the market being created, followed by a debilitating slump. So much for the GST improving employment in this country. In the construction industry, the GST will be a massive disincentive for growth.The community housing sector will also be savaged by this heartless GST. Because most community housing organisations have a turnover of more than $100,000 and are commercial rather than charity organisations, they will be subject to the GST. That will impact on them in a number of ways. For a start, their start-up costs in capital, such as offices and computer equipment, will be taxed. Their ongoing costs, such as maintenance of their dwellings, will also be taxed. And as if this were not bad enough, from the date that the government's GST comes into force they will become tax collectors.In conclusion, I want to talk about the impact that the GST will have in general on the housing sector. The GST will create a massive cycle of poverty. Because of the increased costs many people will be excluded from the private housing market. But then you go to the next rung and you will not be able to rent a house due to the increased costs. But you cannot get into public housing because of the reduced stock. If you do, there will be increased costs. You will be more likely to move and, if you do, your moving costs will be subject to the GST. All this adds up to the government facilitating structural inequality and poverty by having an impact on the housing sector right across the board, whether it be public or private. I want to put on the record that the housing industry is just one reason why this dreadful GST should be opposed. There is no mandate for it because the majority of Australians voted against it.19:50:001766Wakelin, Barry, MPMr WAKELINHV5GreyLP10—It seems to have escaped the attention of our political opponents that on 3 October the Australian people actually voted the Howard government back into government. We won by a very clear majority. We now have this equivocation and this chasing of rabbits down burrows to justify Labor's loss and the reason they cannot support a new tax system. It is not only me who says that. Let us look at the reason the Australian people did not support the Labor Party on 3 October. Let us look at what they thought of Labor's tax promises. Terry McCrann, business writer at the Herald Sun , said:If you vote for Labor on October 3, you will be voting for higher taxes.I know that the people at the steelworks at Whyalla understood that very clearly. That is why in the town of Whyalla—not a town you normally would expect to vote for me—I had a positive vote.You would, I guess, expect the New South Wales Farmers Association to support the government's package, not that they are always supportive of everything the government does. But in this case, with the emphasis on exports, they did. They were quoted on 27 August as being `very supportive of the government package'. Let us look at what the Queensland Council of Social Services said. They said:There's very little in there for families who don't have anyone in the work force. We are disappointed that this package has not gone far enough in terms of reforming the tax system.And so it goes on with many other remarks condemning Labor's tax package. I could quote many people who supported the coalition's tax reform plan, but perhaps the most outstanding quote is by former Labor minister Gary Johns.Mr Laurie Ferguson interjecting—HV5Wakelin, Barry, MPMr WAKELIN—He is one of your own—you can't run away from that. On 20 August 1998, Gary Johns said:I'm coming down firmly on the side of the Howard government tax package because it is the sort of package that Labor will have to introduce at some stage in the future. Any honest, decent government would.That is really what Paul Keating was about back in the eighties when, as Treasurer, he decided to do something decent for Australia. But the vested interests beat him.The great thing about the coalition is that, although we lost the election in 1993 as a result of a very dishonest campaign, we took this proposal to the last election and we won. Surely we now have the right to expect the Senate and this House to pass this legislation.Tonight we have heard a lot about social equity. We have heard a lot about how people cannot afford housing and rent, and other such matters. But how short are the memories of our opponents? A very short time ago in this country interest rates were at 15 per cent when people wanted to buy a house. That was when Labor was in government. The rate is currently between six and seven per cent, making houses as affordable as they have been over the last two generations, I would suggest. As far as the issue of social equity is concerned, I do not think there is a greater social equity issue than the opportunity to be employed. Access to the opportunity to defeat poverty comes from the opportunity to have a job. If you think the current tax system will maximise those opportunities, then I do not think there is very much hope for the Australian Labor Party. We have to face up to the fact, as Gary Johns did, that we need a new tax regime in this country to give Australians the opportunity to invest, create and employ.We could go on at great length about the various components of this package which have been canvassed here over the last few hours. But let me remind the House that we have a plan for Australia: 10 of Labor's hidden taxes will be scrapped; we will have cheaper fuel; there will be less paperwork and less red tape; there will be removal of indirect taxes on inputs; income tax cuts for all; provisional tax will be replaced with a new, fairer pay-as-you-go system; there will be significant cashflow increase for business; there will be more capital gains tax relief and overall we will have a stronger Australian economy.I come to the issue of the Senate. This government has had almost three years of a very successful economic record which is well and truly on the board for all to see. Let us have a look at the record of the Senate, that obstructionist other place which, for those in opposition, has to carve out a place for itself in the sun. Let us look at what the Democrats propose. They said in the election campaign that they would probably support a new tax system. Now they are demanding, along with the opposition, a whole series of obstructive Senate committee hearings. Let us look at what the Democrats are saying about the exemption of food. They say they want food exempted from the GST but they expect there will be an increased compliance cost for some retail businesses.To offset this effect they say, `We propose a modest collection reimbursement scheme where small businesses required to exempt food will be paid an amount equal to 0.2 per cent of the retail turnover, and for large businesses 0.1 per cent of retail turnover, to offset the higher collection fees.' What a remarkable thing to say. On the one hand they say they support tax reform and then in the same breath they say, `but we want to reimburse business'. They want to give small business a couple of hundred dollars per year for the extra book work and they want to give the bigger companies millions of dollars for the extra administration costs. This is the whole point of a new tax system.If we look at our current tax system, we remember that we have seven wholesale sales tax rates. Remember that in 1936 the Income Tax Act had 120 pages. Now it has 3,300 pages and has doubled in size over the last seven years. Yet the Democrats' contribution is to say, `We will give small business a couple of hundred dollars to administer the exemption on food.'Like the previous government speakers, particularly the member for Indi, I request, demand, and I think we have every right to expect this House to support this legislation. The Senate needs to have a good hard look at it and to do the right thing for Australia. I seek leave to continue my remarks later.Leave granted; debate adjourned.19:59:001767House adjourned at 7.59 p.m.Notices1767The following notices were given:Mr Schultz to move—That this House:(1) places on record concern about the lack of sufficient funding for clinical trials for the treatment and prevention of breast cancer;(2) notes that over 8000 women will be diagnosed with breast cancer in 1998 and that over 2700 women will die of breast cancer in that year; and(3) calls on the Government to consider infrastructure funding which will give the foundation and security for planning and completion of quality, evidence-based research.Mrs Crosio to present a bill for an act to provide for the establishment and administration of a scheme to guarantee the payment of wages and certain other liabilities owed to employees in the event of employer insolvency and for related purposes.Mr Andren to move—That this House:(1) notes the article in the Canberra Times of 21 November 1998 and the feature broadcast on 3 December 1998 by `A Current Affair' alleging the profligacy of the Parliament's corporate administration;(2) notes the considerable achievements of parliamentary staff in providing support services to honourable members under the present five department structure;(3) notes the history of failed attempts to amalgamate the parliamentary departments dating back to 1910 that have failed because of either political factors or bureaucratic opposition to change;(4) notes the reported savings made by several Commonwealth agencies, including the Departments of Defence and the Prime Minister and Cabinet, by the use of organisational restructuring and competitive tendering and contracting arrangements for the provision of corporate support services;(5) agrees that the Commonwealth Parliament, as the pre-eminent institution of public sector accountability, should have a support structure that meets the requirements of economy, efficiency and effectiveness it expects and demands of all publicly funded agencies;(6) agrees that there is scope for rationalising the present five departmental structure to achieve cost savings that can be re-allocated to needy areas of public expenditure; and(7) requests the Joint Committee of Public Accounts and Audit, as the audit committee for the Parliament, to initiate an efficiency audit of the current parliamentary corporate support arrangements.Mr Hockey to present a bill for an act to amend the Trade Practices Act 1974 in connection with the implementation of A New Tax System.Documents1768The following papers were deemed to have been presented on 9 December 1998:Australian Meat and Live-stock Industry Act—Orders Nos. MQ1/98, MQ2/98.Carriage of Goods by Sea Act—Regulations— Statutory Rules 1998 No. 324.Defence Act—Determinations under section 58B 1998 Nos. 39, 40, 41.Federal Court of Australia Act—Rules of Court—Statutory Rules 1998 No. 323.Film Licensed Investment Company Act—Determination—1998—Film Licensed Investment Company (Criteria and Procedures).Rules—1998—Film Licensed Investment Company (Application).Income Tax Assessment Act 1936—Regulations—Statutory Rules 1998 No. 325.Loan (Income Equalization Deposits) Act— Regulations—Statutory Rules 1998 No. 326.Migration Act—Regulations—Statutory Rules 1998 No, 322.1998-12-09Mr DEPUTY SPEAKER(Mr Nehl) took the chair at 10.00 a.m.10000DEPUTY SPEAKERMr DEPUTY SPEAKER—Order! A quorum not being present, the chair will be resumed when a quorum is present.Sitting suspended from 10.00 a.m. to 10.01 a.m.Address in Reply17691769Debate resumed from 3 December, on motion by Mr Cameron Thompson:That the following address-in-reply to the speech of His Excellency the Governor-General be agreed to.May it please Your Excellency:We, the House of Representatives of the Commonwealth of Australia, in Parliament assembled, desire to express our loyalty to our Most Gracious Sovereign, and to thank Your Excellency for the speech which you have been pleased to address to Parliament.10:01:001769Andren, Peter, MPMr ANDRENKL6CalareIND00—I apologise profusely for my lateness. I thought there was one other speech to be completed in this address-in-reply debate before mine.I take pleasure in responding to the Governor-General's speech on the opening of the 39th Parliament. I return to this parliament as the only Independent, after receiving a strong vote of support from the people of Calare. Others have analysed the result in various terms, looking at the final two-candidate result from different angles, but all agree that the seat is now regarded as safe independent—whatever that means. That result was achieved on the back of hard work by a dedicated team, including Rod Bruem, Tim Payne, Susan Young, my sister Patricia in Lithgow, Dianne Abbott and the scores of volunteers who helped throughout the past 2½ years and during the recent campaign.As we know, the state of New South Wales is facing a redistribution next year, and I am ready for the cynical political submissions from the major parties designed to redistribute me out of existence. It would obviously suit the conservative side of politics to try to shift Calare's boundaries away from the traditionally Labor supporting Lithgow area, as it would be in Labor's interest to try to move Lithgow into the seat of Macquarie to the east to try to break my hold on the former Labor vote.Any analysis of the Calare result will show that I have won support from all sides of traditional politics, not because I pretend to be all things to all people but because I believe I have identified the issues impacting on regional and rural Australia and particularly on my area.Because of the truncated GST debate I intend to detail my strong opposition to that tax package in a moment, but first I want to address some of the other issues on which I campaigned that were strongly supported by the people in Calare. I continued my stand against any sell-off of Telstra. My office has become a lightning rod for complaints against the service provided by Telstra.Despite the management still blaming its service record on floods or on fires last December, the problems persist. Antiquated copper wiring and inexcusable drop-outs are still part of the telephony infrastructure in this country. We only have to look at today's ACA report showing a continuing decline in the speed of fixing phone faults to realise we still have a major problem in service delivery out there. Internet access is at best patchy, and people in regional Australia just do not accept the argument that government can and will regulate community service obligations when Telstra is privatised.Apart from that, most Australians, particularly those in the bush, have a strong emotional attachment to the former PMG, Telecom and now Telstra, as they do to Australia Post, and they want to remain shareholders, not by paying for them again but by retaining the ownership of these national assets vested in all Australians by dint of generations of taxpayer investment.Like millions of Australians, I am very cranky that the silverware has been stolen off the shelf, flogged at the pawnshop and part of the money used to pay off debts I had nothing to do with. Especially angry am I when I think of the increasing value of that asset and how it could have been there to improve the lot of my children.In supporting the need for fiscal responsibility, I also say here that there needs to be a greater emphasis on social economics. We cannot afford the social cost of filling in budget black holes by hurting those most in need. The solution lies in an honest tax based broadening. We cannot, as this government did, cut deeply into labour market programs when we have no solution to the unemployment question. We should not blame the unemployed for their situation. The obligation is not so much mutual as ours to create ways of generating meaningful occupation.Work for the Dole is a poorly named program that could offer more if it included a training component, and perhaps, in the case of our farm sector, provide much needed assistance to farm families who have no other way of affording labour but who desperately need it. We cannot brag about our economic performance when it comes on the back of cuts to our welfare net, education, health and research and development. We must not ask, `What is the cost of doing something?' but, `What is the cost of not doing something?'The Prime Minister, whom I congratulate on winning the October election, is predictably arguing that the government now has a mandate, when in opposition 11 years ago he took just as predictable a line by saying that the mandate view of politics has always been an absolute phoney. `Is this a core or a non-core belief?' I ask. I, too, have a mandate for my own electorate and, as a legislator, I will argue the case that I believe the majority of my electorate support, whether it be coalition policy or not.I support, as do the very many in my electorate, a philosophy of user who can pay. I argued that case through the public relations debacle of the aged care legislation of this government's first term, because I believed it was right, not because I supported the way it was implemented. With a university town in my electorate, I supported the philosophy of increased HECS charges, but not the cutbacks in funding to TAFE or universities. I supported the common youth allowance, particularly for the opportunities it gave to students leaving country areas to study away from home. But I must say that I am now concerned at some of the impacts on young people forced to stay on at school or forced to come home—from where there is a chance of a job to where there are no chances.The vast majority of Australians will pay their own way, but, in withdrawing funds from areas of acute need, such as the delivery of Centrelink services, this government is not showing the warmer and fuzzier side it allegedly hopes to develop in its second term. The government's own senator, Senator John Watson from Tasmania, dared to suggest, `We've got to be seen to have a heart, to have a social conscience,' but he was quickly silenced.There are issues this government needs to address in the months ahead that are concerning the electorate outside purely economic ones. Child support is one. The Child Support Legislation Amendment Bill 1998 is an entirely inadequate response to the problems the child support regime poses, especially the formulae used to ascertain payments. It is a half-hearted response to the major concerns of the Joint House report of 1994, and this issue will need to be revisited soon if we are to properly address the weaknesses in the current child support program and the potentially homicidal and suicidal anger out there.I look forward to a positive approach to the needs of rural Australia from the new Minister for Transport and Regional Services, though, I must say, judging on reports of talks last night on the Parkes IMC proposal, he has got a long way to go to catch up with the support that the Minister for Agriculture, Fisheries and Forestry, Mr Mark Vaile, is offering that project. I look forward to the contribution by his shadow spokesperson, the new member for Dickson, whom I welcome to this chamber as a person with a true social conscience.As the member for Bradfield said in this debate, the issues raised by One Nation go to the heart of the matters facing rural and regional Australia. Much of One Nation's rhetoric was insular and scapegoating, but it raised issues we must not believe have been swept away. One Nation did not just give us a punch on the nose, as one minister said. The sentiments are still out there and they have to be constantly addressed so that we do have genuine reconciliation with our native inhabitants, so that we properly explain the down and up sides of globalisation and so that we ease people out of inefficient industry and into new training.We must put aside short-term political aims to look for proposals that will serve this country well for decades ahead. To facilitate that, we must also examine the parliamentary term, and, in a bipartisan way, examine the need for a four-year term and a fixed term at that. To not embrace a fixed-term provision, allowing always for double dissolution on supply or other grounds, is not to reform anything. I will be seeking support for a serious debate on this issue during the life of this parliament, as I will for a serious examination of the parliamentary superannuation scheme, which is way outside the ballpark of community expectation.I now want to move on to the goods and service tax in more detail. If we are talking mandates, I have a mandate from my electorate to oppose this tax. I surveyed my electorate during the recent election campaign and found that 56 per cent rejected the GST. Asked if they would support a GST if food was exempt, 54 per cent said no. Asked if the proposed changes to income tax rates were fair, 66 per cent said no. Asked if the needs of low and fixed income earners had been properly considered, 68 per cent said no. The survey showed not only that a majority of people are opposed to the government's proposed tax changes but that even the many who support the package believe it to be unfair to fixed and low income earners.The government is right when it says that the bills are the most far-reaching tax reforms introduced into this parliament since Federation. But far-reaching does not mean visionary or progressive, it means far-reaching into the pockets of ordinary Australians. The GST is all about shifting tax from the well-off and big business, to the not well-off and small business. The tax is about taking the heat off corporations and those who continue to avoid tax responsibilities. It is about taxing those who have no discretionary spending and who have no means available to avoid tax. Those who would argue a goods and service tax will pick up the high fliers and income tax avoiders are deceiving no-one. Professor Patricia Apps of Sydney University says it clearly:It is a matter of simple arithmetic to show that unless marginal rates at the top rise high income groups must gain overall.She goes on:A fundamental limitation of the reform is a shift to a flatter marginal tax rate schedule in the critical $38,000 to $75,000 range combined with no increase in the 47 per cent rate.Apps neatly sums up my basic argument that, to broaden the tax base, we must tax income that is now untaxed, either directly or indirectly. The focus of any reforms must be on measures which reduce non-compliance and the use of tax minimisation schemes. The proposed clampdown on trusts is not enough.In the 1995-96 financial year, while 73 per cent of Australians declared earnings of less than $35,000 and 90 per cent declared earnings of less than $50,000, only 571 Australians declared incomes in excess of $1 million. Of Australia's 200 richest people, 80 declared income of less than $20,000. Those 571 who did declare income over $1 million paid an average of only 20.7 per cent of their earnings in income tax because of tax minimisation measures such as dividend imputation. This was about the same as the average percentage paid by the ordinary battler of between $25,000 to $34,999, who paid an average of 20.8 per cent and considerably less than those on between $35,000 and $49,999 who paid 25 per cent.Then we have those true blue Aussies like Kerry Packer who paid just $25,000 tax instead of the $260 million—over three years—the Australian Tax Office believes he owes. His Australian companies can borrow money at high interest from a foreign company that he controls. The interest is tax deductible in Australia. The foreign company earns the interest as income and pays tax at the very low rates available in the tax shelters—in this case, the Bahamas and Virgin Islands. The foreign company then repatriates the money to the Australian company as capital. This is the tax avoidance of a person who wants to keep foreign hands, including Murdoch's, off any more of our media, yet can use these devices to avoid tax that, by any moral standards, should be paid here.It is not only the Packers. In another study conducted by the Australian Tax Office, 100 Australians were found to be avoiding tax to the tune of a combined $800 million per year through trusts. There is no doubt our tax system needs reform, but that reform should concentrate on a deliberate and determined assault on income tax avoidance. The government has indicated it will tax trusts at a company rate and so it should. But this will still not tax the money shifters like Packer, to whom the government of the day—Labor or coalition—owes so much.There is no stomach for the kind of tax reform this country needs because it is unpalatable and politically risky. We know nothing from the government's GST bills about how the tax avoidance industry will be tackled. We are asked to trust the government to introduce reforms in the business area, when we know the truly necessary reforms to big business taxation are not even on the agenda.One of the members of the government's Small Business Consultative Committee, Angela Ryan, is a strong GST advocate and cites the New Zealand example as `the envy of the world'. Well, the envy of the world is now officially in recession, as is every other country in the region with a GST. Ms Ryan based her assessment of the New Zealand GST on the need to have broad bases so that, if you are taxing income or if you are taxing goods and services, you tax all income and all goods and services.The fatal flaw here is that we are in no way taxing all income. While many members on the government side point to the inexorable creep into higher tax brackets by ordinary wage earners in this country, they are only underlining the fact that the broad base of income taxing is not broad at all. That is because the middle and lower income earners are bearing the burden of income tax through PAYE, and they will continue to bear the burden under this goods and services tax while high income earners and the burgeoning self-employed sector continue to avoid their responsibilities.If the OECD at the behest of the IMF can come up with a concept such as the Multilateral Agreement on Investment, then with our economies more and more globalised surely a tax reform program for the next millennium should investigate a multilateral agreement on taxation, a transnational global taxation system that ensured that full tax was paid on financial movements, transfer pricing and tax haven financial gymnastics. Even George Soros, the `master of global financial markets', is calling for this type of approach. No; instead, we turn on those who have absolutely no discretionary spending, with a bottom-up rather than a top-down tax reform. That is why big business is so keen on this new tax system. According to Chris Evans and Michael Walpole in their Hidden cost of a GST:The international experience unequivocally points to the fact that the benefits of a GST will accrue to the largest firm, whilst those at the other end of the scale will endure disproportionately high compliance costs and few of the benefits.The impact of this tax on the less well-off has been well covered in debate on the bill. The fact is that the fixed income earners, the pensioners, will not be adequately compensated and that that compensation will not be indexed or applied indefinitely.The blanket four per cent pension adjustment makes no allowance, for instance, for higher costs of transport, heating costs and clothing costs in my cool-climate electorate. It makes no allowance for the 25 per cent spent on food by lower income earners as compared with the 12 per cent spent by higher earners. The ABS household expenditure survey shows expenditure per person on food, excluding discretionary restaurant meals, scarcely varies with income.Tax on food, according to John Quiggin of James Cook University, is effectively equivalent to a poll tax, the most regressive tax of all. According to Quiggin, a tax on food will bear four times more heavily on the poor than on the rich. A 10 per cent tax on food amounts to a 2.8 per cent tax on income for members of the lowest income households and only a 0.7 per cent tax for high income households. Claims that a food tax is not regressive do not stand up to examination.There are also concerns, particularly from local government, about the impending transfer of responsibility for local government financial assistance to the states under these tax reforms. For local government, 13 November was Black Friday, when local government reps were turned away and told to go home, while the big boys sorted out their future share of tax revenue. At a time when we should be moving towards constitutional recognition of local government as the genuine third tier of government, this so-called tax reform gives the states almost total domination over local government. No wonder they are rubbing their hands. So much for reform!I must place on the record the government's willingness to listen to some of the arguments about the unfairness of the goods and services tax. It has wisely responded to some community concerns and exempted all recognised education courses, op-shops and non-commercial welfare services from the tax. But it does not go far enough, as I have pointed out.My other great area of concern is the explanation process for these changes. Without a tax office in regional centres, will it be left to local members to explain the detail? Who will explain the impact of this tax to such community organisations as the Western Region Community Transport Forum, which are already faced with the impact of the GST through increased leasing fees for motor vehicles?Quite apart from the complexity of explaining this series of reforms—which lack any detail on trusts, for instance—the GST is a bottom-up, regressive tax on consumption of goods and services. It will impact on those least able to pay, with inadequate and unsustainable compensation, when top-down income tax reform is the only fair and progressive system that we should be contemplating.I will be supporting the opposition's amendments to this legislation. I hope the Senate inquiry process and the likely amendments in that place will deliver a package that has more substantial elements of equity and fairness—something which at the moment the bills certainly lack.10:20:001774Anthony, Larry, MPMr ANTHONYXJ6RichmondNPCommunity Services10—I am privileged to be able to speak in the Main Committee. In my elevated position as the parliamentary secretary, I find that I have very limited speaking opportunities. In the 10 minutes that is remaining, I would like to speak on a couple of subjects. I acknowledge and thank the people of the electorate of Richmond for re-electing me on 3 October. I certainly trust that I can provide them with the best possible services and, indeed, good government in the next three years.The areas that I would like to cover are the recent changes to child support, some of the changing demographics in the Richmond electorate and, in particular, some of the recent economic developments that are happening now on a local level. I will specifically look at the port of Ballina and, if time allows, I will give my views particularly on the Private Health Insurance Bill, which is currently before the Senate.The election on 3 October did produce a mandate for the Fischer-Howard government to introduce major changes in the area of tax reform. It is to provide a workable tax system which is not based on a 1930s system but one which is relevant for the next century. It is a system that is relevant and it also reflects the changing work nature of the electorate, changing particularly from an area where the wholesale sales tax system was geared towards the primary and secondary sector to an area where our tertiary and service sector is now the major employment generator. Indeed, this is where most of the future for this country is.The new tax changes, in the original statement put out by the Prime Minister, particularly look at a mechanism to encourage savings, to encourage incentive, to provide a fair and more equitable tax system, to actually start reducing the high levels of PAYE that we pay in this country. At the same time, the changes look to provide adequate compensation for those on low incomes or no incomes and, lastly, to provide a workable solution to have a constant income stream from the Commonwealth to the states.Indeed, the tax reform package that was placed before the Australian people was endorsed by them in the majority of seats. I can speak with some confidence in making that remark, as I campaigned on a variation of this package in 1993, when it was rejected by the Australian people, but it was endorsed in the 1996 election. I do hope that, despite the opportunism displayed by the Labor Party, particularly with the tax reform package, and most importantly in the Senate, the bill will be allowed to pass prior to the changeover to the new Senate.In the area of child support—and I note that the member for Forde is in the chamber—it gave me a great deal of satisfaction that the actual bill was passed through the Senate this week to ensure greater flexibility and equity, particularly for supporting children and for custodial and non-custodial parents. Whilst this is only a start, it is probably the most positive start that we have seen in the child support area for the last 10 years.A division having been called in the House of Representatives—Sitting suspended from 10.24 a.m. to 10.41 a.m.XJ6Anthony, Larry, MPMr ANTHONY—I was mentioning before changes to the child support legislation that recently went through. I notice in this Main Committee today a number of members who had a vested interest in this. I would certainly like to thank all those on the task force. I would like this legislation passed through the Senate, for a lot of it to be enacted on 1 January and for the rest of it to be enacted on 1 July.I would like to place on record my thanks to Chris Emson and all those associated with Dads Against Discrimination, particularly on the North Coast, those in Ballina and in Lismore and other parts; to George Watts and other members of the Kingscliff Men's Group who have had a very close interest in this; to Tweed Valley Family and Youth Support Services, and to the many individuals and families who have approached me with tales of hardship under the old child support arrangements.Indeed, in the electorate of Richmond, there are over 3,500 child support payers and nearly 4,200 payees. There are more than 3,800 lone parents, one of the highest levels in the country. So the reforms that came through underscore two basic principles: firstly, that children are the financial responsibility of their parents and, secondly, that the government should not seek to intrude unnecessarily into people's lives.Parents who subsequently have a family and pay child support from a previous relationship will now be assessed under the new income test rules for family allowance and child-care assistance from 1 January 1999. Other changes will come into effect on 1 July 1999. This will be the first time many families will be eligible for help such as family allowance and child-care assistance. Those who already receive assistance may qualify under an increased rate of payment.Non-custodial parents will now be able to pay up to a quarter of their child support in kind—a very important initiative. This may include school fees and mortgage payments. This gives payers more control over their payments. Parents will now be able to deduct 50 per cent of their child support payments from their annual income used for family allowance purposes. This means more families will be eligible for family allowance and child-care assistance because they will not be assessed at the lower rate of annual income.The parliament and coalition have certainly made a good start. I look forward to seeing more changes—let us hope of a bipartisan nature—in the years to come in a very sensitive area. It is a privilege that in my tenure so far in parliament a group of us have been able to achieve some reforms which will be of great benefit to those families.I would like to just conclude with some of the changes that have happened to demographics in the electorate of Richmond in the last couple of years. On the north coast of New South Wales, the average household income level is around $29,000; in the seat of Richmond it is significantly lower than that. That means we are $20,000 below the ACT and $30,000 below many parts of Sydney. This has created some of the problems that we have on the North Coast with quite high levels of unemployment. Indeed, the effective employment to population rate is around 44 per cent compared to figures of around 60 per cent in metropolitan areas. Nevertheless, it is certainly one of the best places to live and that is causing part of the problems. People are voting with their feet and they are coming up to the North Coast, which is one of the fastest growing regions in the country.At the 1996 federal election I had around 81,000 constituents on the roll; 2½ years since then, at the 3 October poll, that figure had risen to 86,664—an increase of between 5,000 and 6,000 people—which does not include children or foreign residents. There is rapid growth principally because of population movements.I would like to note some of the local developments, particularly in the three shires of Tweed, Byron, and Ballina and Tweed Heads. There has been a recent development in the new main street in Tweed Heads where the council—and here I would like to acknowledge Rose Wright—has given it a freshness and a new image for the next century. It will be good for tourism and particularly good for attracting business from what you could call some of our more prosperous cousins across the border.There has been a large redevelopment program on Marine Parade in Kingscliff. This has been hugely successful with outside dining and has given the town an uplift and a new cosmopolitan feel which is particularly good for employment generation. I also note that there is concern about aircraft noise in Kingscliff. Aircraft have not been sticking to agreed flight paths and have been overflying the majority of the population in Kingscliff. That should not be happening and I do hope that in the near future that can be rectified.In Murwillumbah there is a new plan being developed now to upgrade the town. I hope that the conflicting interests come together to restore the town to its traditional colonial heritage as a way of making it competitive, particularly against the markets in Tweed Heads or perhaps the Gold Coast. The biggest project there will start next year. It is the Chinderah to Billinudgel motorway, a $220 million road which was a major coalition commitment in 1996. This follows on from the recently completed Bangalow bypass and Brunswick bypass which were done when the coalition was in government.Some other initiatives are quite exciting. In Tweed Heads there is a commitment for a high-tech university campus—an extension of Southern Cross—and this will be a major benefit to that region. I acknowledge Southern Cross University's cellulose valley concept which is trying to develop into a world leader in researching, growing and manufacturing natural medicines, which I think will give it a very good advantage. Another important initiative will be to have more telephone call centres.I would like to acknowledge the recent Port of Ballina concept for which the area consultative committee recently gave $20,000 to commission a study. This is a very exciting project in that it is redeveloping the Ballina waterfront which has been its best natural asset. Most of the development of the town has actually been happening away from the river so that the river bank now is not in a prime condition at all. This particular plan, if it is endorsed by the community, by council, by indigenous groups and by land-holders—and there was a memorandum of understanding signed recently—ultimately could pump up to $75 million into the local economy and create up to 420 jobs. The historic port of Ballina is indeed a grand plan. I would like to acknowledge the work of Keith Davidson, the Mayor Alan Brown and others in pushing this project through. They have shown great community leadership in this area.Finally, as I have limited opportunities in my new capacity, I would like to acknowledge the government's approach to private health insurance. I do note that Senator Mal Colston is showing encouraging signs that he might support a very worthy bill to introduce the 30 per cent rebate. It is particularly important on the North Coast because in the electorate of Richmond over 38,000 individuals have private health insurance and in the neighbouring electorate of Page it is 35,000. Giving this 30 per cent rebate will not only encourage people to stay in private health insurance but also hopefully encourage more people to go into private health insurance and ultimately free up beds in public hospitals which are in a chronic condition at the moment.In conclusion, I hope the main bill that the government has been endorsed on in the tax reform package will be passed next year. The coalition government is providing strong leadership and a strong vision for Australia into the next century.10:50:001777Price, Roger, MPMr PRICEQI4ChifleyALP00—The honourable member for Richmond mentioned child support so perhaps I could say a few words about that a little later.Firstly, in the address-in-reply debate, I want to inform the House that, following a successful walk for reconciliation in Penrith, one of my branch members, Al Svirskis, wanted to know what I and other local state members were going to do about reconciliation. It took some time to get our act together but, with enormous goodwill and assistance from the community, the Australians for Reconciliation Chifley Committee staged a walk and gathering for reconciliation last Saturday. I was enormously pleased at that event.The Governor-General in his address to both houses talked about reconciliation and so I was very pleased that he was able to send a message. That message was read out by Kayla Hall, a young Aboriginal lass from my electorate, and I would like to read it into the Hansard. It says:I am very pleased to send this message of greetings and goodwill to all who are taking part in the Walk for Community Reconciliation through the suburb of Mt Druitt.This is an area where some of the largest numbers of Aboriginal and Torres Strait Islander people live in metropolitan Sydney. Reconciliation is about people coming together; and the best way in which people of any community come together is by walking, talking and sharing the road together.I have long believed that the achievement of genuine reconciliation between the Australian nation as a whole and the indigenous peoples who constitute such an important part is of critical importance as we approach the second century of our Australian Federation. Until such reconciliation is achieved we are a diminished nation.Those of you taking part in the Walk for Community Reconciliation are taking some very important steps as individual Australians along the journey to reconciliation. You are also sending a powerful message of goodwill, tolerance, fairness and mutual respect that I hope will be taken up by communities everywhere.It is signed by Sir William Deane. Both Kayla Hall and Kylie Conn read the messages from other people—Gatjil Djerrkura, the Chairperson of ATSIC; Norma Ingram, CEO, NSW Aboriginal Land Council; and, of course, Evelyn Scott, Chairperson of the Council for Aboriginal Reconciliation.Linda Burney was our special guest of honour. She is the Chairperson of the New South Wales Council for Reconciliation. She gave a very inspiring speech. But she was not too flattering of federal members of parliament—more along the lines that perhaps actions speak louder than words. I regret to say that I do not have a copy of her speech. I missed two of the meetings of the committee, and we had quite a few, I have got to say. At one of them, unbeknownst to me, they had suggested that I should also say a few words. Although these words do not stack up as well as Linda's, and were done in some haste, because we were still trying to get the cricketers off the playing fields and deal with a few other problems that we had on the morning, I would like to put them on the record. This is what I said:I am here to say a few words about what you have already acted out the walk and gathering for reconciliation. Actions always speak louder than words, your actions today are louder than my words.I want to say sorry I want to say it for me my family and my community.Some people have great difficulty in saying sorry or more importantly recognising why we would want to say sorry. But I want to say it for good and selfish reasons.We are today like a chain linked together as a community. Each link is vital and to be valued and esteemed and we are only as strong as our weakest link.We are on Darug land and clearly the people have been dispossessed, as others have been all over Australia. It was not some clever business transaction but it was brutal, dehumanising. Indeed some practises such as taking children from parents, systematically, generation after generation, continued to my time. We know it today as the stolen generations.These actions in the past have stained this great country, and that is what we need to come to grips with and atone for today.We cannot as individuals or as community achieve great things if we are not at peace with one another and ourselves.We are a land of many cultures and peoples but we are Australians all.In dealing with our past we are freed to then be truly better able to celebrate and to take great pride in the oldest surviving culture that of our Aboriginal peoples.In return for all that has been done I am saying sorry.We say sorry if we spill milk, or someone is sick or didn't do as well as they wanted to in some endeavour. Sorry is a small word, which we use often in every day life.To say sorry doesn't seem to me to be hard and I wonder if it is enough.To say sorry, it seems so little and in return the aboriginal peoples are offering forgiveness. It seems to me that forgiveness is the greater gift.Our walk and gathering today commits us to greater understanding to mutual respect and esteem and commits us to work together to overcome entrenched disadvantage.The feedback we have had from the walk has been all positive, but there are a number of organisations I would like to mention, and the list was reproduced on the official program, along with, by the way, an original painting on reconciliation by Danny Eastwood, one of our local esteemed Aboriginal artists.The organisations that I would like to briefly mention include Blacktown City Council, the Blacktown Sun, the Coca-Cola company—by the way, Pepsi, which has a very large warehouse on the border of my electorate, declined to participate—Drug Arm, Featherdale Wildlife Park, Holy Family Community, Mount Druitt Marketown, Mount Druitt Police, Mount Druitt SES, Mount Druitt/St Marys Standard, Mount Druitt Workers Club, my electorate office, Rooty Hill RSL Club, St Johns Ambulance, Sydney Water, Tip Top Industries, and Uncle Bucks, Mount Druitt. All these organisations either donated money or gave generously of their services.The other initiative or matter that I wanted to talk about today was something that started well before the last election, and that was the Mount Druitt Cottage Industry Employment Project. It does seem odd for an opposition member to be thanking the government, but I am deeply grateful that the government saw fit to provide $50,000 for a demonstration program. This was something that Father Hanna, Bridget from Grow and I had discussed informally for some time, but the nub of it is this: usually with labour market programs we try to grab people who have been long-term unemployed and put them through a five-day routine and then prepare them for work in the formal economy—that is, with small business or Woolworths or a variety of firms. But this project is something different. It tries to work with people for actually only one day per week.If they get a job in the formal economy, I do not say that that is a failure, although it is not a stated aim. We are trying to look at, if you like, cottage industry skills and at developing the potential of those skills to allow the participants to earn extra money by producing things and then to graduate from the program, hopefully going out as sole traders or even working with others in some form of company or co-op. So it is, in my experience anyway, a radically different program. It has already started and there are some exciting outcomes.To date, we are acting more like a NEIS or, if you like, an unemployed business incubator. That is perfectly valid. I am not unhappy about that, but we have strayed somewhat from what we originally intended. But I am sure that, over the 12-month lifetime of this project, we will be making a significant contribution. I really do hope the project is successful and is seen as being successful, so that it can be expanded and, if appropriate, replicated around Australia.I must say, too, that I suppose the impetus for this scheme was the fact that I think both sides of politics, or both the major parties, are moving together to really crack down on the unemployed. I think a community needs to respond before it is left in a ditch. In this way, of course, we do a number of things. We credential people as being involved in a very worthwhile activity. We provide skills and we allow people to earn extra money and even to have a full-time income. I think all these things are very worth while. If I have a disappointment, it is the fact that we were not allowed to provide the participants with any extra money for their participation, as was the original design of the scheme. So, in a sense, there was no reward other than their existing social security benefits.I was not intending to speak on child support, but the honourable member for Richmond had a little to say on this. I acknowledge that the member for Menzies is in the chamber. Along with a number of other colleagues, he participated in the review of child support and did a great job. I cannot thank the members of that committee enough. I believe their role has never been properly acknowledged. He has gone on to be Chairman of the Standing Committee on Legal and Constitutional Affairs and he has brought down a very important report that looks at premarriage education and counselling, which is an additional and very valuable aid in this whole area of family law and child support.The point I want to make is that the more I go on in this area—and, in a sense, being a little frustrated—the more I have come to understand that this is one area where the major parties have particular responsibilities. We really do need to come together as legislators in this particular area. I guess the only mechanism to date is the formality of parliamentary committees. It is really difficult to develop other devices, but we need to pay attention to that.I have been critical of both the Liberal Party and the Labor Party, and I will give some examples of my criticism of the Labor Party. At the beginning of the last term of the parliament, Kim Beazley set up a shadow cabinet task force on child support. In the 30 months of its existence, it had three convenors. These convenors did not change deliberately nor did they fail to perform. They changed because of shifting portfolio responsibility. At the end of that 30 months, we had not developed one new idea about child support.In desperation, before the last election, I tried a proposition to allow a new departure which I thought may have addressed the critical area of second families. That was that there was a right to seek a review against an assessment of child support on the basis that children may be discriminated against. In that departure, the reviewing officer would be able to look at the actual household income of both families—I stress `household' income, an important distinction—and if the reviewing officer was able to determine that, on balance, there was less money to support children of one family compared to the other, then that departure should be allowed. I regret to say that that just fizzled in the wind. In this term of parliament, when the opposition is perhaps more convinced that it is close enough to win the election, we have to do some policy hard yards. I do not believe we can just replicate that 30 months of relative inaction.In relation to the coalition side, I have given credit for the changes that have gone through the parliament. I have taken exception to the fact that you have picked some figures, like the 10 per cent figure, and will not show us the modelling, and will not even justify, or encourage us to see, how you arrived at that particular point. As we have moved some amendments, we have tried to gazump you, then you have adopted them and, bit by bit, inch by inch, there is a package of coalition measures and some that the opposition have had an influence in. But none of these measures—and I think the honourable member for Menzies will agree with me—really goes far enough.The minister said he is looking for 1999 as a year of action. I certainly hope it is going to be a year of action but across a broad front of reform—not only child support, but family law and also in the area that the honourable member for Menzies seems to have carved out as a real speciality, which I acknowledge. I do hope that we can work together in a bipartisan way.The Attorney-General, for example, mentioned having a federal magistracy, particularly in relation to the Family Court. Let me make this point on the record—and I must get a question on the Notice Paper: if the federal magistracy is going to make such a profound difference to the way people feel about family law, then clearly this will be demonstrated in Western Australia, which operates under the state jurisdiction which already has a federal magistracy. I am not saying there would be no improvements—far from it. The point I want to make is that there is no appreciable difference that I am aware of in people's views about family law in Western Australia from those in any other state or territory. If that is true, and I suspect it is—maybe I am wrong; maybe people can produce some surveys—then, yes, we will again have made an incremental change but not really gripped what is required, which is some bold reform.There were some other things that I needed to talk about but I have nearly used up all my time. There is another project that has been dear to my heart—the new Mount Druitt college system. I understand that John Aquilina, the New South Wales Minister for Education and Training, will be visiting my electorate on Friday. I am hoping parliament does not extend to Friday, because I would like to be there and he would like me to be there. But, if that is not the case, that is not the important thing. I believe that he will be making an announcement about the new college system of junior and senior secondary education, which is going to be of profound importance to my electorate. It is something that I have been involved in with my parliamentary state colleagues and the community, and I am very much looking forward to being there.Madam Deputy Speaker, I have used most of my time. In the remaining few minutes I want to say that, by serving on the Standing Committee on Procedure again this term, I hope one of the things we are going to be able to do is get some decent reform into the procedures of the House and lift the standing of the House of Representatives in the eyes of the people. The committee system has been one of the greatest innovations in making parliament more accessible to ordinary people. Clearly, we need to develop means whereby they feel that their voices are being heard.11:10:001781Hawker, David, MPMr HAWKER8H4WannonLP10—In joining in this debate I was interested to listen to the words of the honourable member for Chifley, and I must say on his last point I would certainly concur with him and support his efforts in everything he does in trying to lift the standing of the House and the importance that it plays in parliament, in government and, of course, in the eyes of the nation.However, I also noticed in his remarks that there was quite a strong element of frustration regarding the approach to the way this whole issue of child support has been handled. In particular, I noticed a not too thinly veiled criticism of the Labor Party and the Labor leadership, where he made it very clear that he was less than impressed with the Leader of the Opposition and the fact that after 30 months, I think he said, no new ideas have been put forward by a policy committee. I thought that probably sums up the problems that the Labor Party continue to have and that is probably why they are sitting over there and not over on this side.In the brief time I have available to me I would like to talk a little bit about some of the difficulties facing regional and rural Australia and the need to work harder to address some of the inequalities in access to services. I think it is worth noting that in 1986 the federal Public Service Board estimated that people living in towns with a population of fewer than 10,000 experienced `considerable disadvantage', while those living in towns with a population of fewer than 5,000 people experienced `extreme disadvantage'.Unfortunately, in the 13 years of Labor, not enough was done to address those disadvantages and I believe that, while the present government has tackled many of those problems, there is still much to be done. I think it is important that in order to maintain the fairness and equity of our society people living outside our major centres are not made to feel as though they are getting inferior services. We must, of course, remember that we are talking about a significant part of the Australian population and a part of the country that makes a very significant contribution to this nation in so many different ways.It is clear that over the last 50 years there has been a very significant change in the demographics of Australia. In 1947, for example, approximately 31 per cent of the Australian population lived in the rural regions. By 1987 this had been reduced to 12 per cent. The decline is particularly a factor amongst the 15- to 19-year-old age group who migrate to the larger regional centres or the capital cities to seek education and employment opportunities. It is also worth noting that poverty is higher in rural areas than in urban areas, with the average weekly earnings for rural families considerably less than those for city families—approximately $641 as compared to $808. It is worth noting also that of the 37 poorest electorates, 33 are located in rural regions.I would like to turn to a couple of specific areas where in the coming term I think the government really has to work very hard at tackling some of these inequalities to ensure that there is better access to service. The first one I would like to talk about is education because there is no doubt that everyone recognises that education is the key to solving so many of the other problems that people face, whether maintaining a better lifestyle, improving opportunities for creating new jobs or new businesses, or just allowing people to maintain some equity in their income. While most rural students do have access to primary school, and in most cases can live at home to do it, many have to leave to get access to secondary school. What we already see is that the retention rates in the country are lower than those in city schools and the completion rates are also lower in rural areas than in metropolitan areas.In the 1980s there was roughly a 10 per cent gap in the year 12 completion rates of urban and rural students. In the 1990s the figure is still the same for females but, rather alarmingly, the gap is getting larger for males. We all recognise these days that failure to complete year 12 means that people are more likely to join the ranks of the unemployed.When we look at the proportion of students going on beyond secondary education, we again find that it is significantly lower for rural students. A study that was undertaken in 1995 by the University of Southern Queensland highlights the trends in terms of access of rural and remote students compared with disadvantaged groups. I seek leave to have the table incorporated in the Hansard.Leave granted.The table read as follows—University of Southern Queensland study (1995) which highlights the trends in terms of access of rural and remote students compared with other disadvantaged groupsAccess to Higher Education for `disadvantaged' Equity GroupsEquity Groups19911992199319941995Isolated0.660.690.610.640.65Low SES0.620.610.300.620.62Rural0.810.800.780.770.76ATSI0.900.9910.61.131.18NESB1.021.131.191.191.22Females1.121.111.111.121.13In the above table, all values have been standardised so that a value of 1.0 denotes parity in relation to the general population.Access is defined as the number of commencing students in each equity group, as a percentage of total enrolments.8H4Hawker, David, MPMr HAWKER—I thank the Committee. This table shows that in the various groups that were looked at over the years from 1991 to 1995—isolated students, students from lower socioeconomic backgrounds, rural students, Aboriginal and Torres Strait Islander students, students from non-English-speaking backgrounds and females—while access to higher education in the last three groups has in fact improved and is seen to be above the parity in relation to the general population, the same cannot be said for students from isolated areas or lower socioeconomic backgrounds or for rural students.What I find very alarming is that, for example, access to higher education for the rural students has in fact been declining over that period. So we are not even holding our own; we are seeing a drop from 0.81, where one is seen as parity, to 0.76. I think this trend does highlight a very real need for further policy development to allow that access.The National Farmers Federation have done some excellent work in highlighting this problem and, equally, in coming up with some solutions. I think one of the comments they made in a recent policy paper really sums up the problem, which they see as twofold: access and finance. Many students in regional Australia have to go away for tertiary study—not as a matter of choice but as a matter of necessity. The National Farmers Federation states:. . . many farm families are able to pass the AMT—the actual means test—and the income test, but are ineligible to receive Austudy—or Youth Allowance, as it is now known—. . . due to the assets test.The point they make quite clearly and simply is:If the Government does not expect these families to sell their livelihood in order to support their children through education, then the obvious question must be asked, how are these families expected to pay for their children's education?It is a very valid question: how are they expected to pay? Clearly, if they cannot qualify for assistance because of the assets test, yet the assets they rely on are their livelihood, then, as these figures show, many students are not going on to tertiary study and therefore are being disadvantaged by not being allowed to get the same access to services and employment as people in larger urban centres. In this situation the National Farmers Federation have come up with two very sensible recommendations, one questioning the whole basis of the assets test for farming families and the second questioning whether or not there should in fact be a straight allowance paid to all students who have to go away.But we are not just talking about farming communities. A case was brought to me a couple of months ago by a constituent, a qualified teacher residing in a regional centre in my electorate. He is married and has four children. One child resides in Melbourne, attending university; next year a second child will move to Melbourne to attend university also; and there are still two children in secondary education living at home.My constituent has a wage of $50,000 per annum, which is higher than the male average weekly earnings. The three eldest children take part-time work as much as they can, and his wife also works part time. Yet, as he pointed out to me, he will really be struggling to provide support for the two children who will be away at university next year. He has already had to extend the mortgage on his home to help support the second son who will be going to university next year. His children do not qualify for youth allowance, yet he has to face this burden—and it is a real burden. He and his wife will no doubt do everything they can to help those students. But it indicates the growing inequities in regional Australia.I point out that this is not an isolated case; I would like to go into this in a lot more detail, but I realise there are time constraints on this debate. The government, in its first term, has recognised many of these problems and is addressing, across a whole range of areas, the need to create for people living in rural and regional Australia access to services similar to those in the city. But we can see from just this example in education that there is still real inequality and real difficulties for people in country areas. I can see that, in the coming term of parliament, the government—no doubt with the support of the opposition—is going to have to continue to work on addressing these inequalities because, clearly, I think we all believe that this is part of making Australia a better country for all people, no matter whether they live in the city or whether they live in regional areas.11:21:001784Martin, Stephen, MPMr MARTIN8I4CunninghamALP00—I think it is quite timely that, in an editorial in today's Australian Financial Review , we are reminded that, 15 years ago today, at 1 a.m. on Friday, 9 December 1983, two men took a decision that would forever change the Australian economy. That editorial refers to the decision taken by then Prime Minister Hawke and then Treasurer Paul Keating to float the Australian dollar.Much has been said in debate in this parliament over the last several years about the way in which Australia's economy has been internationalised. Much has been said about changing circumstances with respect to our financial institutions. Also, of course, as in the old adage, success has spawned many fathers, while failure is often an orphan. In the case of success with the Australian economy at the present moment—the Treasurer is trumpeting five per cent growth rates, low interest rates and so on—if you could believe everything that the Treasurer said, you would believe that it all happened in the last 2½ years. But, as was clearly identified in the editorial today, anybody who sat back and dispassionately analysed just what major contributions had been made in terms of Australian economic policy in the last 15 years to enable the government to claim the success that they believe has been engendered in the Australian economy in recent times would, I am sure, agree that it was in fact a number of decisions over the past 15 or so years that have assisted that process, not least of which was the decision to float the Australian dollar 15 years ago today.That was a decision that was taken in some very interesting times, and it was taken by the Labor Party. It was taken by a Labor Party that, over a long period of time, had really been at odds over the concept of whether there was a community service obligation on the part of banks to deliver services in Australia generally. It was at odds with traditional views within the Australian Labor Party that, in some way, the banks themselves were part of a money power conspiracy which seemed to be established for the capital side of the equation; it did very little for the working class in Australia. It was taken at a time when that government, within a relatively short space of time after coming into power, had been faced with a massive inflow and outflow of capital on a regular basis from Australia. In terms of what to do with Australia's currency, over a long period of time Treasury officials had always said that it should be propped up and that we should not engender a float. The view that was subscribed to at the time by Treasury officials, led by John Stone, clearly was against what was happening around the world.The decision taken by a Labor government and by Labor Prime Minister Hawke and Labor Treasurer Keating was a very courageous decision at that time. In the subsequent years we saw that decision built upon. We saw that decision built upon in the Australian banking industry by a subsequent revision of Labor policy in respect of the entry of foreign banks. We saw the government decide that it would licence 16 foreign banks. In the final analysis, 15 foreign banks took up those licence opportunities. That decision came after much debate, much pain within the Labor Party, but it did demonstrate that a genuinely progressive Labor Party was prepared to look at its policy and, where necessary, change it.As a consequence of that decision we saw quite a number of foreign banks enter Australia. They did not come in and do everything they were supposed to do. They did not come in and set themselves up to be genuine competitors in a traditional banking sense to the big four banks that were in Australia, but what they did do was come in and offer real competition, particularly in niche markets. The business sector, in particular, was one area where competition became rife.The Labor government subsequently changed that policy and agreed to put a numerical cap on the number of foreign banks that could operate in this country. We then changed the policy again and eliminated that numerical cap. That resulted in an exponential increase in the number of foreign banks here. We saw some come and go but what we have seen is a strengthening of many of those financial institutions.What we have also seen accompanying that around the world now is a whole series of bank rationalisations between big foreign competitors and foreign banks which are operating in Australia. We have seen major banking institutions merge to form megabanks. Those banks operate in this country and they compete against our own domestic banks. Is it any wonder that at the present moment there is so much confusion out there in the community about what the government's intentions are in respect of Australian domestic banking?I am pleased that the speaker before me, the honourable member for Wannon, participated in this debate because in the last parliament he chaired an inquiry into an aspect of banking. As I understand it, that inquiry will continue in this parliament. The inquiry is looking at the way in which banking services can be provided in regional and remote Australia.A consequence of domestic pressures, of competitor edge and so on, has been a shrinking, in some locations, of traditional banking services delivered by the traditional big four banks, but in other cases we have seen community based banks like Bendigo Bank and so on coming in to take the place of those banks that have decided to exit some of those locations. We have also seen credit unions and building societies taking a more active role. In recent times we have seen proposals for a people's bank to be established by the Australian Local Government Association, and we have also seen chemists talking about operating in-store banks.What we have also seen over time is the way in which technology is helping ordinary customers in dealing with what they have perceived previously as traditional financial arrangements. When people shop at a Woolworths or a Coles supermarket they simply swipe their card. Madam Deputy Speaker Gash, I am sure you have seen that in the supermarkets in Nowra or in the Southern Highlands. People now buy groceries or clothes or anything else simply by using EFTPOS facilities. Alternatively, before they go into those particular stores to shop they simply go to an ATM somewhere and withdraw money. Those ATMs are now multi-linked across a whole variety of financial institutions. That level of technology has been with us for some time and people are now starting to feel much more comfortable with it. Similarly, of course, you have telephone banking and banking on the Internet. Internet banking is growing rapidly and will be offered as a product by major banks shortly. You will see that those opportunities are going to present some real benefits to people in Australia.Is it any wonder then that there is still some confusion as to what the government's policy is in respect of the future of Australia's big four banks? Some short time ago, we had the Prime Minister apparently giving some succour and comfort to the big four, suggesting that mergers would be allowed. We subsequently had that particular view disavowed. We then had a view expressed by the Minister for Finance and Administration that all policy was under review. That was disavowed two days later. We then had other mixed signals sent to the broad community that maybe the government would be prepared to review these sorts of issues.Mr Deputy Speaker Mossfield, I know you have a particular interest in the issue of elimination of some banking services in your own electorate. I know you are concerned about the way in which suburban banking branches are disappearing in your own area. But what, in a broader picture, people are concerned about is the direction in which the government intends to take policy in respect of the big banks, and whether mergers are going to be allowed.Labor for its part, of course, has steadfastly refused to embrace the notion that there should be a change in the four-pillar policy. However, as we embark upon policy review at the present moment, I am of the view that we should not necessarily simply say—for some of the bad old bank-bashing reasons that are quite easy for any politician to use—that we will not consider any option before making a final decision.The world has moved on and the world has changed dramatically compared to what it was in the 1930s, 1940s and 1960s in terms of the provision of financial services in Australia. The world has changed dramatically in terms of the internationalisation of our economy, much of it done by a Hawke-Keating Labor government. Much has changed in terms of the way in which we have internationalised our financial services. Yet some have argued—NAB has been at the forefront in this, and Mr Argus, the chief executive, in particular—that Australia does really stand to perhaps be left behind in this world of international finance if we do not have a domestic operation which is able to match it with the big boys.It is a question which I think needs reviewing. It is an issue which I think needs addressing. We need to take into consideration as a parliament: what is in the national interest? Is it going to be in the national interest for that four-pillar policy to disappear? Is it going to be in the national interest for the ACCC to ensure that levels of competition are not downgraded by such an act? Is it going to be in the national interest to have a major domestic bank that is going to withstand foreign takeovers? It does seem that one of the issues out there in respect of the four-pillar policy is whether or not Australians would be more prepared to allow two domestic Australian banks to merge than to allow a major foreign bank to come in and take over one of our own.They are just some of the issues that are around about this very complex issue at the present moment. I do think that on our side of politics—indeed, I think in the parliament as a whole—it is time that this issue received some real airing and some real discussion. Too often and too easily, we as MPs can stand here and, for whatever reasons, kick a bank to death. After politicians, probably banks are the next in line to get kicked to death by the general public. I suspect that a lot of it ensues because of people's memories about interest rate regimes at different times of the economic cycle or because they have been unable to get a loan or whatever.I have to say that banks underpin every aspect of the economic and social elements of our society. They play an integral role in everything that happens in this nation, as they do around the world. We want to make sure that, as we go into the next millennium, our world-class banking system is able to continue to play a constructive role in the internationalisation of banking services. What we do not want to see is a head in the sand attitude that says to people, `We are too frightened to even examine an issue because we do not think the politics of it at the minute is right.' What we have to do is to say that we want to look at these issues—whether in banking or a whole range of things—to find out what is for the good of Australia.In conclusion, I would hope that we are not afraid to do that across the parties and across the parliament. I would hope that the decisions that are taken will come after thorough examination of the issues, because nothing could be worse for Australia—nothing could be worse for your constituents in western Sydney or for my constituents down in Wollongong—than to find, under the guise of improving competition or providing an opportunity to buttress Australia against international pressures, a diminution in some way of the way in which services are delivered to our constituents.That has got to be important. If the banks are really serious about this they need to not only look at a better way of selling the proposition but also take a more pro-active role in ensuring that the services that underpin every aspect of our economic and social life in this nation are delivered fairly and equitably. They also need to understand that from time to time people need to feel that they can walk into an institution and talk to someone face to face about a particular problem.Let us not be frightened of change. It is always difficult when one embraces change in a general sense. The world is moving so quickly, technology is advancing so rapidly and banking systems are changing so dramatically around the world that we should not be frightened to look at the issues as they might affect Australia generally.11:36:001787Worth, Trish, MPMs WORTH8V5AdelaideLP10—I am pleased to able to speak in this address-in-reply debate at a time of such significant change. In today's Bulletin I note Max Walsh's commentary and quote him for the benefit of those listening:During the 13 years in which Labor ruled in Canberra, the real earnings of Australians—that is, their inflation-adjusted wages and salaries—rose by 6%. In the two years to the June quarter of this year—the latest figures we have available for the Howard era—real wages rose by 10%. And what is critically important in respect of that figure is that the profit share of income climbed from 16% of GDP to well over 17%. Not since the `60s have we had it so good.The explanation of this simultaneous rise in both real wages and profits is that our national productivity has moved up a gear. Just how and why this has happened is something that the economists will pore over. However, the statistical fact is that the Howard government, by the most sensitive measure of the hip pocket nerve, really has delivered.This was confirmed last week with the recent release of the national account figures for the September quarter. Whilst the Asia-Pacific region has experienced economic turmoil, Australia's economy has grown by five per cent over the last year. Japan and New Zealand, for example, have struggled to achieve positive growth while Korea and Hong Kong have experienced a seven per cent constriction on their economies. Even the economic powerhouses of the United States and Germany could only manage 3.5 and 2.5 per cent growth respectively.In the last three months, 90,000 jobs have been created and interest rates continue to fall. When the coalition government first came to office, variable mortgage rates were at 10.5 per cent. Today they are 6.5 per cent. Inflation remains below two per cent. Australia is performing strongly in an international economic environment that has seen many other regional economies verge on collapse.The sound management of the Howard government and getting the fundamentals right—reducing debt and improving the delivery of government services—have provided all of us with an economy that is secure and that will safeguard our lifestyles into the next century. After receiving a clear mandate at the last election, the coalition government is committed to boldly replacing the outdated wholesale sales tax system, which has held Australia back for so long, with a new and fairer tax system that will create a more competitive and secure Australia able to face the challenges of the new century.The introduction of a GST and other tax reform will guarantee a revenue base for future welfare and community spending, deliver income tax relief for Australian families, address the social and economic challenges that will accompany the ageing of Australia's population and will ensure that we will all pay our fair share of tax while giving business the opportunity to expand and hire more of our young and long-term unemployed. The Labor opposition has chosen to defend an outdated tax system and ignore these challenges. Without any credible alternatives it is no surprise that Labor refuses to acknowledge the mandate given to the coalition at the last election on tax reform—reforms that many traditional Labor voters supported.It is appropriate that I take this opportunity to make some observations and to raise some concerns that I have following the recent election. It is my strong belief that when we are elected to this place we have a duty to represent all of our constituents, whatever their political persuasion or social or economic background. I have worked hard to do this in my own electorate of Adelaide with, I might add, some positive outcomes. As a consequence, some loyalties are formed that seem to enrage the local Labor organisation and retaliatory action follows.For example, Phil Martin is a hardworking and active achiever for the Kilburn community. He was a vocal supporter for my re-election, not because he was a Liberal voter, but because I got results for Kilburn. Unfortunately, he is no longer chairman of the Kilburn Football, Cricket and Community Club and, sadly, he has taken some flak because of his support for me. Cliff Votier, who has been a Labor supporter in the past, and his wife, who has been a union delegate, believed that both the coalition government and I should be re-elected because of our record of achievement. Cliff has been subjected to nuisance phone calls since.As another example, I had formed a close working relationship with a parent from the former Croydon Primary School. She wrote a warm letter to me thanking me for my support when the school was facing closure. However, during the election campaign, her name appeared on a document entitled `When we needed her most, Trish Worth let us down'. She subsequently told a member of my electorate staff just how helpful I had been. I feel concerned that this parent may have experienced the same form of intimidation by Labor activists along the lines experienced by some of my other supporters who live in traditional Labor territory.People being judged by their so-called class and the suburb they live in is a thing of the past in our modern Australian society. Labor, in attempting to drum up class distinction where there should be none, shows how out of touch it really is. Labor in Adelaide once again adopted the Graham Richardson approach of `whatever it takes' to win the seat. What Labor failed to realise was that the voters want sincerity and genuine commitment to represent their needs. They do not appreciate mud-slinging or scare campaigns, such as the fake bills for household expenses Labor sent out against the GST, or misleading information, such as the false claims made by my Labor opponent that there had only been one pension increase over the last two years. As Terry McCrann said in the Advertiser during the campaign, `Beazley wants to launch a vicious and breathtakingly cynical attack on the great mass of middle Australia.' This of course was evident in Adelaide.This negativism and division continue. In the last weeks, we have heard the maiden speeches of all the new members. I was in the chamber for the one given by the new Labor member for McMillan. He said, `The political centre is not where I want to be,' and speaking as if he and his family had a mortgage on hard times and a tough upbringing. His statement that Liberal and National Party members are `the sons and daughters still of the moneyed elites' is so offensive and incorrect that it does not warrant a response—suffice to say that the coalition is incredibly diverse. I remind the member for McMillan and others who hold his view that the coalition is the party with the ideals that middle Australia, and a good number of traditional Labor voters, continue to embrace as being fair and responsible.Time in parliament is often set aside before elections for valedictories of retiring members but there was no opportunity to thank members who were not returned. Ian Sinclair, Ian McLachlan, Bob Halverson, Noel Hicks, John Sharp, Michael Cobb, Bruce Reid and Bill Taylor chose to retire, and I wish them all well. Others like Andrea West, Elizabeth Grace, Graeme McDougall, Russell Broadbent, Richard Evans, Ricky Johnston, Chris Miles, Susan Jeanes, Eoin Cameron, Warwick Smith and Bob Baldwin sought to be re-elected and were not. Those members worked hard for their constituents and made a contribution to this place.Eoin Cameron of course entered parliament with me in 1993, and I will miss his very fine sense of humour. Warwick Smith, with whom I formed a close working relationship when we shared responsibilities in the Health and Family Services portfolio, will be particularly missed. Susan Jeanes, a fellow South Australian, failed by only a handful of votes, despite her tireless work on behalf of the constituents of Kingston during her parliamentary term.In the last parliament, in my position as Parliamentary Secretary to the Minister for Health and Family Services, I was fortunate enough to continue working in an area in which I had been involved for many years. In this parliament, I am looking forward to making a significant contribution as the Parliamentary Secretary to the Minister for Education, Training and Youth Affairs. My aim is to raise the profile of young people so that their needs and aspirations for the new century are heard and acted upon by the government and the wider community.I have already been impressed by the Green Corps initiative introduced by the coalition in the last government. I have visited two of these projects and have heard and seen first-hand the job skills that the young participants are learning and the environmental benefits for the surrounding communities. Only yesterday I released for public comment the draft National Schools Drug Education Strategy, which is part of the Prime Minister's $290 million Tough on Drugs policy. Parents, teachers, key health care experts and community groups have been invited to submit suggestions on how to fight illicit drug abuse in schools and to achieve world's best practice in educating young Australians to the dangers of drugs.I would also like to use this opportunity to express my thanks to the Prime Minister and the foreign minister. After my representations on behalf of my local Greek Cypriot community in Adelaide, the appointment was made of John Spender as special envoy to Cyprus, to help convey Australia's views directly to the parties in the region and to encourage greater participation with the United Nations effort to reach a peaceful settlement. I am disappointed to learn from the foreign minister that Labor had said that the envoy would be sacked if Labor were elected. I shall continue at every opportunity that is available to me to raise the Cyprus problem and the need for justice and human rights in that country.My electorate of Adelaide is multicultural; it is diverse. I thank everybody there who supported me and voted for me. I undertake once again, in this term of government, to do the best I can for my constituents.11:46:001790Quick, Harry, MPMr QUICKAV5FranklinALP00—I, too, welcome this opportunity to speak on the address-in-reply. It is great to be back for my third term in this House. At the outset I would like to pay a few tributes to the many people who assisted me not only in the campaign period but also during the life of the last parliament. To Alma, Sarah and Hannah, thanks for being there. I know it has not been easy with all of us trying to make our marks in the world, each of us with our differing priorities. For us to have succeeded as well as we have done shows a real resilience and a real love for each other.To my staff—Cheryl, Glenda, Roger, Miriam and Vicki—I give my heartfelt thanks. You have been the front-line people in the office, day after day, dealing so superbly with the varied concerns of the constituents. Each of you has done much to ensure that, whatever the problem, just about everyone has gone away happy in the knowledge that their problems have been sorted out. To my wonderfully organised campaign team of John Shepherd, Bernie Harrington, Martin Titherley and Mark Sayer, and to the many branch members, friends, union members and volunteers, thanks for the long hours you have spent doing all the bits and pieces that make effective campaigning seem so straightforward and simple. Being elected this time around places all of us in the 39th Parliament in a unique position. God willing, we will be able to claim a place in history as the first members of the House of Representatives to have served in two centuries and two millennia.The Franklin electorate has had nine members this century—unfortunately, only three of them Labor. We have seen long stints by Liberal members, interspersed with Labor members. The three Labor members have been able to complete at least three terms in the House: Charles Frost, Ray Sherry and I.Following on from the state Labor Party's great election result a month out from the federal poll, it was very pleasing to see the federal Liberal primary vote in this election come in at 39.41 per cent, the fourth worst vote for the Liberal Party since World War II. It was also extremely gratifying to see Tasmania return five federal Labor members this time around, a 100 per cent record. The last time this occurred was in 1974. Congratulations to Michelle O'Byrne and Sid Sidebottom for their tremendous work in defeating Warwick Smith and Chris Miles and in joining Duncan Kerr, Dick Adams and me in this great place.Each member in this place has their own style, their own way of doing things, their own way of trying to convince the electors that they are the person to put their faith and trust in. What the local member does, how effective he or she is, and how efficient and effective the electoral office staff are, does have a huge bearing on the result achieved on polling day.Do not believe the newspaper experts and pollsters and the party spin doctors. In order to survive in this place and not be a `oncer', you have to have laid the proper foundations right across your electorate, servicing the whole cross-section of the various communities and being there seven days a week for your constituents. People from all walks of life heap it on us. We are regarded as being a different subspecies. People constantly question our motives and try to second-guess why we do what we do. Every time one of us falls from grace, the Australian media loudly trumpet the fall and insinuate that collectively we are all the same. Just you wait and see!Members of this House, as we near the century, represent a community unsure of their country's future direction, unsure of their own job security and unsure of their children's future. In many regions of our electorates, communities see more and more resources removed to the larger towns—Medicare offices, banks, child-care centres, state and Commonwealth agencies, and private sector agencies closed. The call centre has become the latest icon in society and the 13 number, if you foolishly believe the spin doctors, will solve all our ills and still provide a service to the customers. Arrant nonsense!Face-to-face and person-to-person service is what our constituents deserve and what they are now demanding of their legislators. The bottom line and the dollar return to investors is not what society is all about, as far as I am concerned. Every night on our news bulletins, we see nations across the globe struggling to overcome yet another catastrophe, their citizens asked to bear yet more grief. Developed nations are being asked to bail out country after country and the list continues to grow. The IMF and World Bank continue to give money out in what seems a never-ending futile exercise. Hurricane Mitch's devastation of Central American countries recently is forcing developed nations to seriously look at finally resolving the debt problems facing so many Third World countries. The phrase `global community' is constantly bandied about, yet when it comes to seriously tackling global problems, the developed world often puts up the shutters and tries to ignore what is happening across the ocean or else intervenes to serve their own strategic self-interest.My neighbourhood, your neighbourhood, is a microcosm of society in general and the world at large. How well is your neighbourhood faring? How well are the many neighbourhoods in your electorates faring? Doorknocking in my suburbs as I do on a regular basis, trying to keep in touch with the mood of my electorate, what do I find? Telstra quietly removing phone boxes from the neighbourhood because they are sick and tired of the constant vandalism. Who suffers? Families who cannot afford the phone and rely on the local phone box in times of emergency. When this vandalism occurs, does anyone really bother to intervene, to even report it to the police? No; better not get involved as those antisocial misfits might take it out on you. The cycle continues. Because it is not reported, the police statistics do not reflect what is happening and the need for action to sort out these troublemakers is not forthcoming.The aged in our community, fearful of this criminal element, fortify their units and retire from society before dark. Local schools face horrendous maintenance bills from mindless vandalism after school and during vacation time—money far better spent on providing wider educational opportunities for the kids that really care. Local government has been forced to divert much needed resources away from basic service provisions due to the antisocial behaviour of a small percentage of our community. When they are finally caught, we see them go through the farce we call our judicial system. Have a closer look at your local newspapers and read the punishments handed out. What a joke! What sort of society do we have when the answer to many of your community hassles is to spend $11 and take out a restraining order? What sort of society do we have when the answer to tens of thousands of families' inability to cope with a pending Christmas is for the government to give more money to the Smith Family, Salvation Army and St Vincent de Paul and then to wash their hands of the problem?Think back to your childhood, your teenage years, when you bought your first home and settled into your current neighbourhood. Compare and contrast those times to the social confusion and uncertainty present in your neighbourhood today.I mentioned earlier that politicians are seen as distant from society. Have a closer look. Those of us doing our jobs in our electorate offices are confronted daily with a plethora of social problems that constituents cannot cope with. We as politicians are part of our society; our families are going through the same stresses and strains—we are not immune. I have a 19-year-old daughter at Melbourne University experiencing the highs and lows of first year. I have a 22-year-old daughter, also in Melbourne, coming to grips with her new job—the second since she graduated from university. I have an 81-year-old mother living in Victoria, hundreds of kilometres from the capital city, battling to access aged care services.As we approach the centenary of Federation and the start of a new millennium, let us all take another look at what we are really on about as citizens, not only of Australia but also of this beautiful planet. As we focus on our foundations, our local communities, and see how we as federal members can assist in a meaningful, constructive and productive renewal of our Australian society, let us always be mindful of the even bigger perspective. Former US President Jimmy Carter put it so eloquently in his final address to Congress when he said:The same rocket technology that delivers nuclear warheads has also taken us peacefully into space.From that perspective, we see our earth as it really is—a small and fragile and beautiful blue globe, the only home we have. We see no barriers of race or religion or country. We see the essential unity of our species and our planet, and, with faith and commonsense, that bright vision will ultimately prevail.I thank you.11:56:001792Nairn, Gary, MPMr NAIRNOK6Eden-MonaroLP10—In responding to the Governor-General's speech, I would like to make a few comments about the federal election with respect to my electorate of Eden-Monaro and also to talk about some of the things I want to pursue over the next few years.Firstly, I am extremely pleased to have been re-elected the member for Eden-Monaro and very honoured to be once again representing the people of Eden-Monaro in the federal parliament. I often say to people that when I first walked into the House of Representatives chamber it gave me quite a chill up the spine. It still does that and I have said that I hope that never disappears, because it really is quite an honour to be one of so few people with the privilege of representing a very large community in the federal parliament.It is also very gratifying to be part of the second Howard-Fischer government. It was a courageous move by John Howard to take major tax reform to an election. He certainly put his political neck on the line, and he won. I believe the people of Australia are quite relieved that the coalition won the election because, although there was always going to be some hesitancy about taxation reform—the fear of the unknown or the fear of change—underneath it all the people knew that reform was needed. In political terms, taking taxation reform to an election is a gamble simply because it is easier to scare people in a global sense than it is to explain a new tax system in a global sense.Prior to the election announcement, I conducted a series of information sessions throughout my electorate. I found that the basic problem in explaining a new tax system was that very few people understood the current system. There was an amazing lack of understanding of just how the wholesale sales tax system works. I guess I was fortunate in that I have had to deal with it for many years within my business, trying to work through the complexities of how sales tax applied to something like producing a map, which was my profession. It was just staggering the different rates that applied to different parts of that process all the way through. So it was no stranger to me at all, but people did not understand the system.When people used to ask me to explain aspects of the taxation reform we were putting forward, I would often start the conversation by saying, `Well, explain to me the current system.' It was not surprising, I suppose—but, in other respects, it was surprising—that so little was known. What that did in an election campaign was basically give our opponents an opportunity to run some fairly predictable scare tactics that were used in the 1993 election—successfully for them at the time but, fortunately, unsuccessfully for them this time.We had brochures being sent around the electorate that specified that a whole series of items would be going up—not saying that they would have a GST of 10 per cent but specifically saying that the price would go up 10 per cent. When you delved into those particular items, you found many which had 12 and 22 per cent sales tax on them. They were very borderline cases from an advertising point of view. I regret that recommendations for changes to advertising, which were made by the Joint Standing Committee on Electoral Matters that I chaired in the last parliament, were not taken up at the time. It is an aspect that could possibly be pursued further in this parliament and when a review of the Electoral Act takes place.Towards the end of the campaign in my electorate we also had money being offered and thrown around like confetti. Fortunately, once again, those bribes that were put out in a last desperate bid in the last week of the campaign did not work. The end result, as most people would know, was a close result in the electorate of Eden-Monaro. From the coalition's point of view, it is supposedly the second most marginal seat, with a difference of about 262 votes.It should be pointed out that our Labor opponents barely increased their primary vote from 1996. The lowest Labor vote on record was in 1996 and they only increased that vote by a whisker over one per cent. The only reason that it became a very close result in the end was that nearly 60 per cent of One Nation preferences flowed to the Labor Party. So, from 1996, votes lost by the coalition went to One Nation, which picked up about 9½ per cent of the vote, and then nearly 60 per cent of that flowed to the Labor Party.The reason that such a large proportion did flow in that direction was that the how-to-vote card that the One Nation Party put out in my electorate was heavily biased to the Labor Party. This was an interesting circumstance because my Labor opponent ran a very hard campaign early on about how dreadful One Nation was and all those sorts of things, but then we found that One Nation ended up basically preferencing the Labor Party. It was a very curious result, although some people put it down to the fact that there were identifiable Labor people handing out how-to-vote cards for One Nation.The end result though was that justice prevailed and I retained the seat. Certainly, I thank very much the many supporters who worked very hard for me. Stephen Beer, my campaign director, and all of the people right around the electorate, worked extremely hard, particularly on polling day. It is a major feat to man over 70 booths on the day; it is a very large number. We were very fortunate that we had all of our supporters out there manning all the booths. My Labor opponent had to import union people from Sydney to fill up many of the booths, so I am very proud that our local people were able to be there on the day.Over the next couple of years there will be major projects throughout my electorate that I will certainly be working on. Key infrastructure projects which will have ramifications right throughout Eden-Monaro are the armaments complex and the Eden multipurpose wharf. The armaments complex is a project which has been developing seriously probably only in the last year. It was totally off the equation there for a while because the previous Labor government had decided to put this complex in Victoria, near Geelong. The Public Works Committee brought down a report some months ago saying that Point Wilson in Victoria was not an appropriate location for the armaments complex; Eden was seen as a much more appropriate location. Defence studies are currently going on and I would expect that a reference will go back to the Public Works Committee very shortly. Hopefully, we will see that project come to fruition over the next couple of years.An armaments complex will then justify the construction of a multipurpose wharf. As many of us know, once you put in place major infrastructure projects like that, it is amazing the sorts of additional industries that can grow as a result. It is the old chicken and egg situation. I certainly will be pursuing that.The Queanbeyan area will benefit from the Very Fast Train project which is gathering momentum, and certainly I would like to see the region participate in that project. After we get it from Sydney to Canberra there is then the possibility of taking it further. Hopefully, a route through Eden-Monaro into Victoria will be considered eventually. That will definitely happen in the long term, but the first stage is to get it from Sydney to Canberra.The regional forest agreement is a crucial project to get finished in the south-east, but I have spoken in the House on that topic numerous times in the last couple of weeks as we try to pull the Carr New South Wales government back into a proper RFA process with the Commonwealth rather than have the unilateral decisions that they continue to make.There are additional Medicare Easyclaim facilities that have got to get into some of our smaller towns. I managed to get about six or seven of those into areas where there was no Medicare facility. We had them going to places like Bungendore, Eden, Jindabyne and Moruya. Certainly there are other towns like Bermagui and Braidwood which would benefit from extending that service.A further project that I will do some work on concerns the Queanbeyan River. It is a major river through the Queanbeyan area but it has been neglected over a number of years. The Landcare people are putting together a great management plan for it. I think it is an opportunity for Green Corps and Work for the Dole type projects to pick up on the management plan for that river. They are just a couple of the projects spread out around the electorate which we will be doing some work on, and which will help the overall area.Could I say in conclusion that the Governor-General's speech set out a comprehensive plan for the future. The coalition government has the runs on the board. We have reduced government debt. We have created a climate that has allowed interest rates to not only come down but stay down. We have brought inflation down. Economic growth has been strong, outperforming all expectations, and this has resulted in many more jobs and sustained falling unemployment rates.In the next three years I want to see that good performance nationally extend throughout my electorate of Eden-Monaro so that my constituents enjoy a higher standard of living. I look forward to representing each and every one of them during this term of the government.12:08:001794Latham, Mark, MPMr LATHAMK26WerriwaALP00—The Australian tax base is broken, but a GST is not the way to fix it. This government is engaging in a 1970s answer to the tax issues of the coming century. Whereas the industrial revolution gave rise to the taxation of labour and capital, it is not yet clear how the tax system might be structured for the information age. The narrowing of the tax base in Australia is a sign of this dilemma. In every case the foundations of the base—wholesale sales tax, PAYE taxation and the corporate system—are weakening.The sales tax regime has been undermined by the shift in consumer spending from goods to services. This is the inevitable consequence of a modern service based economy. Tax modernisation is needed to protect the integrity of the public sector's revenue base.The PAYE system has seen a large number of taxpayers move onto corporate rates. This is a product of the disaggregation of economic activity with the huge growth of small businesses, franchisees and outsourced workers. The new economy has facilitated a shift from labour earnings to corporate earnings. These new companies have been able to take advantage of the 14 per cent gap between the top personal rate in Australia and the company rate.Notwithstanding this movement, the corporate tax base is also in poor shape. The growth of multinational transfer pricing, income splitting and other avoidance measures have put a large hole in government revenue. This has coincided with a loss of public trust in the fairness of our taxation system. It seems the wealthy corporations and individuals are able to find holes in the tax net faster than the parliament can close them. This is what the Commissioner of Taxation, Michael Carmody, had to say on 19 November:. . . the sort of arrangements that we are seeing are of businessmen: you've got a risky venture, you want to get some capital—don't worry, we'll do that through the tax system for you; or you've got a capital gain that's a bit of a worry for you—don't worry, give us $4,000 and we'll manufacture a $50,000 loss for you.. . . . . . . . .It's potentially several billion dollars we are concerned about. . .. . . . . . . . .. . . things like tax-effective investments in a variety of primary production films, research . . . circular loans . . . In some of the superannuation arrangements. . . Huge amounts of revenue are also being lost through the practice of multinational transfer pricing. Despite the strong economic growth of recent years, 60 per cent of multinationals in Australia continue to report losses. Some have been doing this for decades. They are large global companies with billions of dollars in assets and turnover, yet they never claim a profit and, therefore, never need to pay tax in this country.Moreover, in all nations, the footloose features of capital have forced policy makers to drive down their corporate tax rates in search of international competitiveness. If a nation taxes earnings too severely, corporations and even some citizens have the capacity to move to a more generous jurisdiction. Like so many other aspects of public policy, the taxation system is struggling to cope with the globalisation of investment.No-one genuinely supportive of the active role of government in our society could be satisfied with the existing tax base. It has meant that public revenue is only likely to grow off the back of strong economic growth and wages growth. This is why successive governments in this country have engaged in the deceit of bracket creep. It is estimated that, by the year 2000, the annual bill for returning the rate scale to an indexed version of those introduced in November 1993 will be $11 billion—that is, $1 in every $8 collected from income tax will come from bracket creep. In the absence of tax indexation, the progressivity of our tax system has gradually been eroded. Whereas the top marginal tax rate in the 1950s cut in at 19 times the level of average weekly earnings, this ratio has now fallen to below 1.5. This problem is further illustrated in the table I have distributed, for which I seek leave for incorporation in Hansard.Leave granted.The table read as follows—Income taxes and multiples of average earnings, AustraliaAverage income tax rate Proportion of average earnings (%)aYear33661002004008001977-780.014.821.131.444.453.61981-826.619.323.533.846.053.01982-837.419.022.933.946.853.41984-858.718.923.737.549.154.61987-889.118.925.035.743.046.61990-919.716.824.135.341.845.01992-939.715.222.834.040.543.81994-9510.416.322.233.040.043.51996-97b10.917.322.833.840.443.7Note: These figures equal the average tax rate applicable in certain years to income levels, expressed as a proportion of AWE. a Average total earnings for all male employees b Estimates Source: Average Weekly Earnings, States and Australia, various (ABS Cat. no. 6302.0), Australian Taxation Office.K26Latham, Mark, MPMr LATHAM—It is simply not possible to defend the current tax system on the basis of its progressivity. In 1995-96, the poorest quarter of taxpayers received 9.5 per cent of total pre-tax income in this country and 11.2 per cent of after-tax income, while the top quarter received 47.5 per cent of the nation's pre-tax income and 43.7 per cent of the after-tax income. This indicates that the net redistributive impact of our income tax system has fallen below three per cent. Those who believe Australia still has an acutely progressive tax system are deluding themselves. This is a major problem for left of centre parties.The new labour market is characterised by the growth of income inequality that rewards the information rich while punishing poorly skilled workers. The tax system now needs to offset this inequality with a strong redistributive role. Improving the integrity and progressivity of the tax system has become a first order priority for the Australian Labor Party.The work of government cannot be adequately funded from its current revenue sources. Social democracy is in search of a sound tax base. This is an important response to globalisation and the way in which footloose capital is able to seek out low tax regimes. Across the developed world, taxes on earnings are losing their effectiveness.Among the possible sources of taxation now available to nations, only acts of expenditure and property related assets appear unaffected by the mobility of investment. If someone lives in a nation, they must also undertake their consumption of goods and services within its boundaries. This is an important part of the new economic geography—taxing items and assets which are not easily shifted across national boarders.Traditionally, consumption has been taxed through flat rate levies on transactions. This option is now being pursued by the Howard government via the revival of proposals for a GST. This agenda, however, represents an exercise in retro-economics. It ignores the challenges to tax policy posed by electronic commerce. The great tax avoider of the next century will be the Internet.The rise of electronic commerce is likely to make the policing of transaction taxes exceedingly difficult. Whenever the place of purchase varies from the location of actual consumption, the potential for tax avoidance will arise. Consider, for instance, an information related service purchase from an overseas bank account, yet transmitted for consumption in Australia. The Australian Taxation Office would have trouble assessing records related both to the payment and consumption of this service. It is becoming easier to police individual taxpayers than taxes on transactions—especially given the prospect of billions of transactions in cyberspace.Each of these trends, Mr Deputy Speaker, points to the virtues of the direct taxation of expenditure. This represents a third way in tax policy. The old Left, with its reliance on the progressive taxation of earnings, is struggling to cope with the nature of the new economy.Equally, the New Right's policy for the indirect taxation of consumption is being challenged by the rise of electronic commerce. This is why proposals for a progressive expenditure tax—a PET—now look more appealing. This is a relatively simple concept: income must be either spent or saved. Under a PET the taxpayer is required to provide evidence of their savings to the tax office. Once savings are deducted from earnings, an expenditure amount can be identified for each taxpayer.This system is one step removed from the current income tax system in Australia. This taxes earnings as they accrue, irrespective of whether they are subsequently saved or spent. The PET taxes income minus any net additions to savings. That is, it taxes income only as it is spent. As the PET applies directly to each taxpayer it is possible to levy a progressive scale of tax rates, thereby satisfying equity objectives. Someone spending $100,000 a year for instance would face a higher rate of tax than someone spending $20,000. The tax scales can be made as progressive as policy makers might desire.It is important to understand that the progressivity of the tax system is not necessarily linked to the incidence of tax. In this regard, tax rates matter much more than tax incidence. This is an important adjustment for left of centre thinking. The old Left has convinced itself that the taxation of earnings is inherently progressive while the taxation of consumption must be regressive. Yet this is simply a question of timing: the difference between taxing earnings as they accrue and taxing earnings as they are spent. The key issue lies in the application of various tax rates. As Australia's leading tax expert, Vince FitzGerald, has argued:By contrast with an indirect tax on spending, a PET applying to individual taxpayers can be made as progressive as desired—just as comprehensive income tax can. Both models can be designed to raise any given amount of revenue using similar marginal tax rate structures, notwithstanding that the base for the PET is at any time somewhat smaller than for income tax—noting that since in Australia, as in most western countries, household savings rates out of disposable income are relatively low, the percentage difference is not great. Raising any given amount of revenue will therefore require a slightly higher tax rate under a PET than under an income tax.That is what our leading tax expert has had to say about this proposal. Yet some retro journalists such as Brian Toohey and Tim Colebatch have argued a PET would favour the wealthy, given their relative propensity to save. It needs to be appreciated, however, that under the current tax system people with high rates of savings have available to them a range of tax concessions and deferrals on their savings. Conversely, low income earners tend to make more use of high tax forms of savings such as bank deposits. The PET would eliminate this inequity in the taxation treatment of savings across various income bands by treating all registered savings as PET exempt.The PET does not provide unreasonable tax benefits for savings. In fact, it is neutral in the taxation treatment of consumption and savings. It taxes both once: consumption as it occurs and savings as they are withdrawn and then spent. This corrects the unfortunate way the current system taxes savings twice—once at the point of initial earnings and then at the point of interest earnings.Australia has one of the worst savings records of any advanced nation, leading to a chronic current account problem and high structural unemployment. A progressive expenditure tax would help to correct this fundamental weakness in our national economy.The progressivity of Australia's tax system can be enhanced through the introduction of a PET based on two principles: first, a tax-free threshold addressing the basic food, shelter and clothing needs of low income families—that is a subsistence amount exempt from the PET—and, second, high marginal rates on high levels of personal expenditure, designed to harvest substantial revenue from the extraordinary growth in consumption among wealthy Australians.This is a breakthrough, in the fairness of the tax system, ensuring that the big spenders in this country face a progressive scale of tax rates on their expenditure decisions.The PET also has a critical role to play in the taxation of footloose capital. It taxes the cash flow of companies. Investments are expensed as made, with full cash margins taxed later. If companies trade in Australia they must have a cash flow here. The PET thereby establishes a relatively secure tax base for corporations. Avoidance techniques, such as transfer pricing, become less effective. Anyone concerned by the incidence of corporate tax avoidance in Australia would strongly support the progressive expenditure tax.This tax needs to come onto the parliament's agenda. If, as seems likely, the GST passes the Senate some time next year, the opposition will need to devise a better way of taxing expenditure. Having declared war on the GST during the last campaign, it will not be tenable to go to the next election with a promise to keep it. The answer lies in the progressive expenditure tax as a revenue neutral way of replacing the Howard government's regressive GST.I fully agree with the shadow Treasurer's House amendment two days ago describing the GST as `an unnecessary, unfair job destroying tax which discriminates against low and middle income earners, the aged and families'. If it is ever introduced, such an unnecessary, unfair, discriminatory and job destroying tax will need to be repealed. That strikes me as self-evident, particularly from a party of social justice. This, of course, is the historical purpose of Australia's great party of social justice, the ALP. We are here to replace bad taxes with better taxes. We are here to replace unfair taxes with fairer taxes. This is why Labor exists.It is not as if, as some have said, the GST is like some scrambled egg which can never be unscrambled. It is in fact just another tax, which this government is trying to place on the statute books. Just as the GST can be legislated in, it can be legislated out. The progressive expenditure tax gives Labor its best chance of replacing the GST with a fairer and more practical tax. The PET can be introduced as a complement to the existing tax system and raise the same amount of revenue as the GST.It is self-evident that any set of progressive PET rates must be fairer than the GST's flat 10 per cent rate. The PET rates can be as progressive as policy makers desire—such as three stepped rates of five, 10 or 15 per cent or, even more progressive, of two, 10 and 20 per cent. The PET would also reverse the job destroying impact of the GST. As a direct tax, it takes away the transaction paperwork burden on small businesses. It also helps to boost national savings and take the brake off Australia's underlying rate of economic growth. The PET is not only fair and progressive; it is a job creator, against the job destroying impact of the GST. So in each of its features this tax that I am proposing—the progressive expenditure tax—is the antithesis, the exact opposite, of the government's GST.The PET is Labor's logical alternative in tax policy. If this government introduces its proposed $13 billion in personal tax cuts, there will be little room for further cuts of this kind. It is hard to imagine a party topping up $13 billion in tax expenditure with the promise of further personal tax cuts at the next election.At the last election, the opposition promised $5.8 billion in tax cuts for people who work. This was an earned income tax credit—a policy that was first introduced in the United States under the Ford administration, for those who remember Gerald Ford. It has become a very expensive policy in the United States, with the tax credit now providing up to 40 per cent of the income of some families.The tax credit, of course, is best known for its role in assisting the deregulation of the labour market. It is a tax cut offered as compensation for real wage cuts with the greatest impact on minimum wages. In the United States, the tax credit has facilitated just one increase in the minimum wage since 1975. Australia needs a strong, indexed minimum wage, not wage deregulation for our lowest paid workers.Australia is well placed to be the first nation to implement a PET—either the full progressive expenditure tax or as a replacement for this government's insidious GST. The transitional issues involved for a PET are not severe, due to Australia's relatively weak range of asset based taxes. Moreover, advances in information technology are likely to make the recording and data processing of savings flows and balances a comparatively simple task. The PET now represents an entirely practical reform.It is important to note that this concept is not foreign to the Australian tax system. Aspects of the PET have already been introduced into tax policy both here and overseas. Again I quote Vince FitzGerald:Australia, like every other country, has some elements of expenditure taxation in its direct tax system, even though that system is basically modelled on the comprehensive income tax.For example, most capital gains are taxed on realisation (although in many cases this occurs earlier than withdrawal of the resources for spending on consumption, because the gains are reinvested). In respect of the major savings vehicle in Australia, superannuation, the present treatment is neither pure income taxation nor pure expenditure taxation, but a complex hybrid.That is, a combination of both. He continues:Most other OECD countries, however, provide a large area of pure expenditure taxation in respect of pension fund saving, as indeed Australia did prior to 1988.That is, prior to the changes in 1988. He continues:While the treatment of saving in the form of equity in owner-occupied housing may not appear to match the direct expenditure tax model, as above defined, nevertheless it is one of a number of variants of expenditure taxation. The key points of commonality are that the principal is taxed once and only once—albeit at the outset; and period-to-period returns are not taxed.. . . . . . . . .In short, while the model as advocated by the 1978 Meade Committee (in Britain) has not been implemented at full scale in any country, large elements of it exist in most, and some elements of it exist in all countries.This is an idea whose time has come in Australia. The PET is feasible, practical and progressive. It is a fair alternative to this government's determination to introduce a regressive, flat-rated 10 per cent GST. I believe the PET will come much more onto the agenda of the parliament. Labor will be looking, logically enough, for alternatives to the GST if the legislation passes the Senate some time next year. We cannot leave such an insidious and regressive tax on the statute books. A social justice party will seek to remove it at the first available opportunity, and the progressive expenditure tax is the best option in that regard.12:27:001800Draper, Trish, MPMrs DRAPER0L6MakinLP10—I wish to take this opportunity in speaking in the address-in-reply to the Governor-General's speech to take stock, in a sense, since it is now approximately 2½ years since I made my first speech in this place. It is a great honour for me to speak in this place as the member for Makin in the 39th Parliament, to again represent the constituents of Makin. I thank them for supporting me at the last election and I will endeavour to represent them to the very best of my ability.At the time of my first speech, my three sons were present in the gallery to hear me speak, and it was for them as well as my constituents in Makin that I stated that what their mother hoped to achieve in this place was `to secure a better Australia for them and their generation which can provide a lifestyle and job opportunities to allow them to achieve their aspirations in the future'. Two and a half years on, I can say with some pride that this government has achieved a substantial amount in this regard. Not only did Beazley, Keating and company not bring home the bacon with their last budget before the 1996 election but the cupboard was more than bare: $10 billion in debt, in fact, at the time of the March 1996 election.In my first speech I reported to the House that poverty, inequality and unemployment were continuing to increase, despite the denials of the ALP. In a very short time, the government has turned these factors around. Interest rates and inflation are now at historically low levels, and unemployment is finally falling although, as we all know, it is still too high. But the Howard coalition government will continue to implement reforms to address this problem, particularly in macro-economic policies and in micro-economic reforms, such as the unfair dismissal laws. In 13 years of self-proclaimed socially just policies, the previous government had manifestly failed these key tests of economic management for the good of all, particularly for those on low incomes. At the time, I asked, `Where is the social justice in unemployment?'Two and a half years on, people can once again aspire to such things as gainful employment, home ownership and greater control over their own destiny. The government has been able to achieve these things because it understands that having a social conscience is not about crying crocodile tears for the less well-off but about taking practical action to help them and to enable them to help themselves. The Australian Labor Party will stand with its hand on its heart and speak about its concern for disadvantaged Australians, but it fails every challenge to give practical effect to its professed concerns.You would think that the Australian Labor Party would now be eager to grasp every opportunity to make amends to the Australian people and support measures which might improve opportunities for Australians who are battling. Does their record so far in this 39th Parliament reflect such a desire? Sadly, it shows just the reverse.Wednesday, 2 December was a historic day not only in the life of this 39th Parliament but also of our country, Australia. It was a day on which the government introduced into the House the new tax system series of bills, to fundamentally reform Australia's taxation system. I commend the Treasurer, the Hon. Peter Costello, and our Prime Minister, John Howard, for the tremendous way in which they have been able to achieve this magnificent reform.This legislation seeks to redress the inequities that afflict the current wholesale sales tax system. It seeks to reform the tax base, so that governments of the 21st century will be able to finance the social services that are needed by our society. It also seeks to safeguard the incomes of people on government pensions and benefits, something that the previous government failed to do when it increased sales taxes to the tune of billions of dollars.The Australian Labor Party have opposed the abolition of the ramshackle wholesale sales tax system, which taxes baby food but not smoked salmon. They have opposed the abolition of job destroying state taxes and charges, such as FID, BAD and a range of stamp duties which currently afflict small business.They have opposed a private rebate for people who wish to take out private health insurance, a measure which would unquestionably relieve the burden on our public hospitals, which many of my constituents in Makin are concerned about, as they want the 30 per cent private health insurance rebate as promised by the coalition in the last election campaign. Over 42,000 of my constituents in the electorate of Makin, 56 per cent, are currently privately insured and have a right to the rebate. I will fight for the rights of my Makin constituents.You have to hand it to the Australian Labor Party—they are consistent. They have consistently opposed every measure which would make an appreciable difference in the lives of people they claim to represent. Ironically these are the very same measures which will deliver more to their constituencies than they were able to do in 13 years.The government's proposed new tax system will create jobs because it will remove the administrative complexity associated with the existing system. It will allow for pay-as-you-go taxation and it will abolish a series of state government stamp duties. These measures, together with further industrial relations reforms, will free up business and small business in particular. This is the only way that sustainable new private sector jobs can be created—by creating a favourable climate for businesses, and particularly for our small businesses.What the opposition seems to have so much difficulty coming to terms with is the social benefits that will be associated with these reforms—namely, more equitable taxation, including tax cuts to people on lower and middle incomes, more job opportunities and more affordable health care.I would like to make some comments in relation to reconciliation. It is my firm belief that genuine reconciliation can only take place when we have finally been able to address the continuing inequities that exist in the areas of health, employment, education and living standards for our indigenous people, with successful outcomes. In the House in June this year, I referred to:. . . the importance of teaching our children—our next generation of leaders—that to differentiate one person from another you only have to ask their name, and that race, colour, religion, age, gender, disability, or, rather, special ability, is not critical in order to differentiate one person from another. I went on to say on that day:It is up to us, with the help of our children, to ensure we pass on the most worthwhile of all life's lessons: acceptance of ourselves and others as truly worthwhile and valuable individuals.But, of all the achievements of the Howard government's first term in office, perhaps the area in which I take the greatest personal pride is the work that has been done to create a safer environment for our children. Prior to entering parliament, I had taken an active role in opposing the screening of a film in Adelaide called Salo , in which were depicted various acts of sadomasochism and sexual abuse of children.Since that time, the government has taken significant steps to strengthen Australia's approach to the fight against child exploitation. We played a substantial role in the declaration and agenda for action against the commercial sexual exploitation of children, in Stockholm in August 1996. Our own law and justice amendment legislation in that year tightened the criteria for classifying certain advertisements which may contain child pornography. The same legislation also made it harder for sensitive material to be hidden in sophisticated computer games and `click on' access films.The coalition has developed a national paedophile database to protect our children. I also have the pleasure of reporting to the House that I have personally been in contact with the Minister for Communications, Information Technology and the Arts, Senator the Hon. Richard Alston, to express my concerns and those of my constituents about the recent use of obscene language on commercial television. The minister has been investigating this issue through FACTS, the Federation of Australian Commercial Television Stations, and the ABA. I have also discussed the issue of ongoing funding of Young Media Australia to enable the good work that they do to continue in monitoring television and media in relation to violence and other issues for our children.During the recent election campaign, the government undertook to, amongst other things, provide up to $50 million to establish a national information system, Crimtrack, to significantly improve the ability of law enforcement agencies throughout Australia to solve crime. In cooperation with the Judicial Conference of Australia, I will be organising a South Australian forum between members of the parliament and the judiciary, similar to the forum held here in Canberra, to promote better understanding between judges and parliamentarians and to discuss issues that are of particular concern to our constituents, such as sentencing laws.In the electorate of Makin, the government's Tough on Drugs program has also been very well received. That program provides more resources for law enforcement, with noticeable results in recent times, as well as a preventative education program to warn our kids of the danger of illicit drug use. In Makin, as part of the schools drug education strategy, and in conjunction with Senator the Hon. Nick Minchin, I launched the Makin schools competition in which students were encouraged to devise new ways to educate their peers about the dangers of drug abuse.Students at the Salisbury East High School produced a board game called Choices, in which players are confronted with a range of facts about the consequences of drug use and real life situations in which to apply their knowledge. I am pleased to announce that Senator Nick Minchin, along with me, presented a cheque for $500 for first prize to those students.These are just some of the examples of this government's social policies in action, though there is clearly more work to be done in this very important area. In all of these examples we see the government empowering individuals and communities to face challenges in their own way. Instead of thinking of each other as competitors for the welfare dollar, we as Australians need to further cooperate with each other to build a stronger society to mutual advantage, a social vision which is positive rather than negative, which seeks to build rather than tear down and which looks for mutual obligation rather than compensation. This government will continue with the economic and social policies that seek to strengthen individuals, strengthen families and communities, and strengthen Australia and our place in the world.Finally, I take this opportunity to thank my family, friends, staff, the Makin federal electorate committee and volunteers, all of those who gave their time to the Liberal Makin campaign—my FEC president, Bob Day; Senator the Hon. Nick Minchin and his staff; the Barker FEC; the former Minister for Defence, Ian McLachlan, and the new member for Barker, Patrick Secker. I look forward to continuing to work with the Barker FEC in the future and thank them for their support. As we all know, not one of us is able to get here on our own.Finally, to my three boys—Chris, Graham and Michael—to Zara and Alex, and especially to my partner, Paul, without whom I would not be here in the first place—thank you.12:39:001803Jenkins, Harry, MPMr JENKINSHH4ScullinALP00—The address-in-reply debate is traditionally part of the ceremony of the opening of a session of parliament. As we come to the conclusion of this debate, it is worth while to reflect on the change that has come about as a result of the recent election and what that really will mean for the work of this parliament over the next few years.Indeed, there has been a great debate over these first few weeks of the parliament about what it has really meant with regard to a mandate. The notion of a mandate, of course, is worthy of a greater and longer debate, but certainly we on this side acknowledge that—because we are on this side—we lost the election. We failed to gain the majority of votes in a majority of the seats. But in saying that, I think that the government really needs to look at the election result and understand how finely balanced the Australian public is in its support for the coalition, as opposed to the Australian Labor Party.The government should not be in a position where it thinks that it is not open to criticism about the platform that it went to the Australian public with. The government should understand that it needs to engage in a dialogue with the Australian public not only at the time of an election but also during its time of government. The debates that we have seen about things like the private health insurance rebate, and the continuing debate—however truncated over the next few days—on the GST package indicate that perhaps the government has taken a very closed-ear policy about continuing discussion.One of the things that Labor learned after 13 years in government was that if you stopped listening, and if you stopped having a dialogue with the Australian public, they would punish you. That is a lesson that the Howard government should have learned. It should realise that Australian politics does not work in the way it envisages—that simply because they say something is right, they say they have something they want to put in place, on the basis of a two-party preferred support of 49 per cent, they should be cautious in the way in which they put it in place.In earlier debate down in the main chamber I heard the honourable member for Cowper make mention of how tough this election campaign—KV5NEVILLEMr Neville—Who's he?HH4Jenkins, Harry, MPMr JENKINS—The honourable member for Cowper is Mr Garry Nehl. He said that this was one of the toughest campaigns that he had envisaged and that, regrettably, members of his staff had been open to abuse. I would make similar observations about the campaign. Yes, this was a tough campaign. It was an indication that people were perhaps a little polarised in the way they were approaching the election and in the way they were taking it seriously. Yet again, there is a lesson to be learned from that: that the Australian public, in the way in which they are approaching politics, have a very great desire to see that they are included in the way in which decisions are made. Hopefully, with the result of the state by-election in Queensland, we have seen yet another decline in what we hope was only a transitory factor in Australian politics, the rise of a party that was able to cash in on the disquiet that the Australian public had with the major parties.In talking about disquiet, I have a degree of concern with a couple of elements in the run-up to the election campaign in the way the government was projecting policies that it had in place. I had some concern that Centrelink, which had been put in place to take over the administrative responsibilities for the Department of Social Security, and certain aspects of the Job Network, decided in a self-promotion exercise to insert advertisements throughout Australia under the headline `4,500 People Have Been Convicted of Fraud; Don't be the Next'. Whilst I do not think there is any debate from either side of the chamber about whether those that try to defraud the social security system should not be dealt with, I have some question about the way in which these figures might be heralded, because of the damage that it actually does to those who try to do the right thing. In fact, when we talk about 4,500 people being convicted of making fraudulent claims since July 1996, we should also acknowledge that in Labor's last two years of government there were some 4,933 people convicted of social security fraud. This is a continuing phenomenon and organisations such as Centrelink, which have the responsibility to ensure that social security legislation is put in place and that it is done in a legal sense, should have continuing responsibility. When that figure is used against the Labor opposition to try to suggest that we in government had not been as diligent about these matters, I have great concern. These ads were run in the run-up to the declaration of the election. They also included the information that 570,000 people were found to have been overpaid and had their payments reduced or stopped.These figures might at first blush be quite startling but when you really look at the reasons for these figures you might take a more sanguine view about what they really represent. For instance, the 4,500 people convicted of fraud represent 0.044 per cent of the over five million clients of Centrelink.As for the 570,000 people who were overpaid, many of them were unintentionally overpaid because they had difficulties in understanding what was required of them by Centrelink. That is something that we have to continue to look at, to ensure that people understand when they should be explaining changes in their circumstances to Centrelink. Also, some of those 570,000 cases actually are as a result of the way in which Centrelink processes claims. As I understand it, the government in part acknowledges that point and has tried to change the legislation to put in place start-up dates for benefits and the like to try to minimise those effects.The real concern I have is that the coalition, when the election got under way, used those 570,000 overpayment cancellations or reductions to indicate that there was something like $46.4 million per week being saved because of that action. One line comments were made in advertisements, both in the print media and on television, that Labor was opposed to measures that would lead to these savings. I just do not think that there is any proof of that. I do not think that there is anything that indicates that Labor was opposed to that. That was a regrettable aspect of the election campaign.Another aspect that I wish to go to, and I will only go to it briefly on this occasion, is the continuing use of statistics to herald that the Job Network has been successful. These statistics suggest that Job Network has been more successful in placing people in employment than was the CES. I call upon the government, and now Minister Abbott, to come clean on what these figures actually represent. In the full explanation of the methodology behind these figures it has to be acknowledged that in comparing Job Network only with the CES we are not comparing like with like; we are comparing chalk with cheese, apples with pears.An article in the Sydney Morning Herald on 25 August that did not really get much of a run indicated that those figures comparing Job Network with CES ignored the case managers who looked after 250,000 long-term unemployed, and they ignored the 622 sites outside of the CES where these case managers were.If we are going to be fair dinkum, let us compare the totality of what was on offer in the Labor programs with the totality that is on offer in the coalition's Job Network. This is something that I will be returning to throughout the course of this parliament because I believe that, if we are going to have a debate, it is important to have the facts.If we have ministers using question time to falsely quote those figures to indicate that they believe there is nothing wrong with Job Network when it is obvious to anybody on the ground that there are deep problems with Job Network, deep problems that have to be addressed, we need to have the facts. We do not need mickey mouse bandaid solutions addressing those problems; we need a serious review of those problems. We must ensure that the minister responsible does not continue this farrago where he is suggesting that Job Network in comparison with the CES is an improvement, because it is simply not so.In the remaining moments that I have, I just wish to return directly to a portion towards the end of the Governor-General's speech, where he went to the question of reconciliation, because I believe that there can be no more important question that the Australian parliament should be addressing as we approach the end of this century and the start of the new millennium. The Governor-General said:As we approach the new millennium and our Centenary of Federation we also face the challenge of reconciliation between indigenous and other Australians.The government will work to achieve the goal of reconciliation over the next two years. It will do so in the knowledge that the great majority of Australians want true reconciliation to be achieved and will support a co-operative approach to achieve that outcome.The government continues to believe in the importance of achieving practical outcomes for indigenous Australians—particularly in terms of improvements to their health care, their education, their housing and their job opportunities. In its second term, therefore, the government will be looking to secure ongoing progress in these key areas.The opposition would wholeheartedly support the achievement of those outcomes in those endeavours.Throughout your parliamentary life, as you would be aware, Mr Deputy Speaker Nehl, you not only use the types of experiences that are directly to do with your own electorate but build on the opportunities that the privilege of being a member of the House of Representatives gives you. One of those experiences for me was in the last parliament when, as a member of the House of Representatives Standing Committee on Family and Community Affairs, I was involved in the commencement of the reference given to that committee on indigenous health.Something like 500 people of indigenous background live in my electorate according to the census. It is not something that I am exposed to in my day-to-day carrying out of my duties as a member of this place. To be able to go and investigate the problems that our indigenous people face, especially to do with their health, throughout the whole of Australia was quite an eye-opener for me. I think there can be no other greater issue that we should confront than the deplorable state of the health of our indigenous people.The ABS Health & Welfare, Aboriginal & Torres Strait Islander Peoples report of 1997, for instance, stated about indigenous people:In most States and Territories, their babies are about 2-3 times more likely to be of low birth weight and about 2-4 times more likely to die at birth than are babies born to non-Indigenous mothers . . . Indigenous people also suffer higher rates of infectious diseases, including tuberculosis, and sexually transmitted diseases. There were 4-5 five times more hospitalisations and 15-18 times more deaths from infectious diseases . . .And it can go on and on. It is a very bleak picture that can be revealed and it is a picture that we all owe a responsibility to take an interest in.One of the aspects that was interesting as we developed the inquiry and gathered information was that, despite a myth that appears to be popular out in the general public, very few additional funds are given to indigenous health. In fact, if we compare the expenditure on health for indigenous people per capita with that for the rest of the Australian public, it is only about 10 per cent more. It is a ratio of one to 1.1. This is on the basis of a very fair analysis of the expenditure.It acknowledges that indigenous people are unlikely to use the medical benefits scheme and the pharmaceutical benefits scheme. It acknowledges that there are barriers for them to the use of those schemes. So it is a fair analysis. This is something that we really need to work on and work on hard.In the first instance I hope that the government gives this parliament the opportunity to continue the investigation through the Standing Committee on Family and Community Affairs. I think that would be the desire of those people from both sides of the parliament who took a particular interest on that committee in the last parliament. At this stage I place on record my gratitude for the way in which the honourable member for Mallee conducted himself as the chair of the committee and the chair of the inquiry. He endeavoured to seek and get our cooperation for this to be very much a bipartisan approach, because we knew that without bipartisan agreement we would not get lasting solutions to what is a very deep problem.There is just one piece of evidence that I want to put into the record in this address-in-reply speech. It comes from Professor Gus Nossal, who I think can be quite easily described as an eminent Australian. Gus Nossal appeared before the committee as part of the AMA's expert panel. But in introducing himself to the committee he quite rightly indicated that he was there not only as President of the Australian Academy of Science but, secondly, as the recently elected Deputy Chairman of the Council for Aboriginal Reconciliation. In his opening remarks to the committee, Gus Nossal had this to say:This country will be the focus of world attention twice in the near future. In the year 2000 there will be 200 or more cameras pointed towards the opening of the Olympic Games. In the year 2001 certainly all of the Commonwealth countries—and I dare say other countries—will be looking at the centenary of our federation. If reconciliation is not a done deal by that time we will be diminished in a serious way, to the detriment of all the Australian people at that time.He went on to say:The two aspects of reconciliation that are uppermost in the minds of Aboriginal people are land rights and reparation for the stolen generation and what flows from the stolen generation report.He said:I believe . . . we have to grope for other elements in the reconciliation spectrum and what better place to start than health. Health is a non-controversial: there is no division between the political parties about the shameful state of Aboriginal health; there is no division about the need urgently to address it. I think that that gives this group—that is, the committee—enormous leverage to press on and make the kinds of financial demands which we are making.That is the AMA panel. He went on:That would be my first point: health as a tool of a non-controversial sort and a doable towards reconciliation.In supporting the words of the Governor-General's address with regard to reconciliation, I believe that indigenous health is an important aspect. It is, in the words of Gus Nossal, a doable. It is not the only one. I believe that we have taken evidence that the questions of Aboriginal education and Aboriginal employment opportunities are all interrelated. They are something on which we can put together a package that is holistic, that gives an opportunity for the indigenous people of Australia to be directly involved in outcomes that they would want to aspire to and that I believe the whole Australian public would want to aspire to on their behalf. This is something that this parliament, this particular parliament in the run-up to the end of the century, can make a mark in. I believe it is something that both sides of the chamber can seek cooperation on. I think it is something very positive and a great reflection on the Australian parliament. (Time expired)12:59:001807Causley, Ian, MPMr CAUSLEY4K6PageNP10—It has been a little bit of a battle to get to speak in this debate, having started as second speaker in the main chamber and almost sliding off the end of the debate up here in the Main Committee. But can I say it is a pleasure to rise and speak in reply to the Governor-General's address given at the start of this 39th Parliament. No doubt it is one of those addresses that we all understand. It sets out the government's policies and programs for the next three years, a continuation of a responsible fiscal policy which has done so much for this country over the last 2½ to three years.Since coming to this parliament after the 1996 election, I have seen that progress take place. As we know, it has often been painful overcoming the enormous debt that was left by the previous government. It was very painful in programs where we needed to balance that budget. I think my electorate of Page has certainly suffered as much as any other electorate. But we knew full well that we would have to take the pain if we were going to get the gain at a later date.I would like to thank the electors of Page for re-electing me for my second term in the federal parliament. Undoubtedly, we were very proud of the result. It was one of the lowest swings in Australia, in a fairly volatile election. The campaign was waged very strongly. I will be very interested to see the declarations by the various parties of their donations and who was involved in the funding. I would say the Australian Labor Party spent $200,000 to $300,000 campaigning in the electorate of Page. It will be very interesting to see where those funds came from.On top of that, we had at least four unions involved in the advertising campaign—one disguised as `Australians for a Fair Go', which sounded great, as far as the public were concerned, until I found that it was the Public Service union. We had the timber workers, the school teachers and the Public Service union. It was a very strong campaign but we saw it through, because the people of Australia realised that they needed this strong leadership.In my history in politics, and going back before I was involved in politics, I do not think I have ever seen a braver stand than was put forward by the Prime Minister in this particular election. He laid it all on the line. It was a very risky exercise—as a few of us would have thought at the time—to put forward clearly what he intended to do. People are now saying, `When we look across Australia, and we add up the numbers, more people voted against the government than voted for them.' That is just splitting straws for the want of coming up with an excuse to oppose the clear policy that was put forward. It could not have been clearer.The misinformation, the lies and the scare campaign that went on obviously affected the electorate and cost seats. There is no doubt in my mind. Certainly, it cost big majorities in many electorates. But, despite that, the Australian people realised that there had to be some change in the system and therefore they voted for it.The Governor-General's speech outlined a lot more than just the tax package. It indicated clearly the commitment the government has to electorates such as Page. While the figures are not spelt out within the speech, I know that the government has a strong commitment to the upgrading of the Pacific Highway—something I know Mr Deputy Speaker Nehl has a great interest in—and the Summerland Way, which is a main arterial route leading to Brisbane. Obviously, with the program that has been set out, and with the fact that we now have a very balanced budget—which leaves money available for those types of programs—it ensures that that promise set out clearly by the government can be fulfilled.I thank the House for its indulgence. I know that we are terminating this debate here at the present time, and that we intend to deliver the address-in-reply to His Excellency this afternoon. If His Excellency delves through the speeches that have been made in this august parliament he will see that many members have contributed to it. There have been many maiden speeches—probably the largest number of maiden speeches that I have seen, although both times I entered different parliaments there was a large entry of new members. I think it was 21 in New South Wales and 30-odd in the federal parliament. Nevertheless, there has been a healthy contribution to the address given by His Excellency.I am sure the government will forge forward with the policies that were set out clearly in that address. I dare say the government will succeed by the end of the three-year period in establishing its position as a very responsible government and it will be re-elected at the next election.Motion (by Mr Neville) agreed to:That further proceedings be conducted in the HouseMain Committee adjourned at 1.05 p.m.Answers to Questions in Writing1809The following answers to questions were circulated:1809(Question No. 31)311809Latham, Mark, MPMr LathamK26WerriwaALP00 asked the Minister representing the Minister for Industry, Science and Resources, upon notice, on 11 November 1998:(1) What measures has the Minister's Department undertaken which are categorised as positive discrimination programs, that is, providing preference to certain citizens on the basis of their gender, sexuality, age, race, place of birth or some other personal characteristic.(2) What are the details and funding commitments involved in each case.1809Moore, John, MPMr MooreEI4RyanLPDefence10—The Minister for Industry, Science and Resources has provided the following answer to the honourable member's question:(1) The Department of Industry, Science and Resources presently participates in two centrally run programs which are categorised as positive discrimination programs.(a) the Indigenous Cadetship Program, administered by the Department of Employment, Workplace Relations and Small Business (DEWRSB); and(b) the Senior Women In Management development program administered by the Public Service and Merit Protection Commission.(2) The details and funding commitments involved in each case are as follows:(a) Indigenous Cadetship ProgramIn 1991 the Federal Government endorsed the Aboriginal and Torres Strait Islander Recruitment and Career Development Program which includes the Indigenous Cadetship Program. The Indigenous Cadetship Program was established to provide for the recruitment and training of indigenous people for professional careers in the APS. The program provides cadetships for full-time academic study in an approved tertiary course. Cadets are also required to participate in a program of employment placements within the employing agency during the summer break. Cadets must be enrolled in an approved undergraduate degree course at an Australian tertiary institution.The program is overseen by DEWRSB and responsibilities for the administration of the program and the monitoring of cadets are shared between DEWRSB and ISR.Currently, the department is employing 2 cadets under the program. ISR provides salary for the cadets during their work placements. Accommodation and expenses for cadets from interstate are also met by ISR during the work placement.(b) Senior Women in Management (SWIM) Development ProgramThe Senior Women in Management Program is a management development program designed and administered by the Public Service and Merit Protection Commission to significantly enhance the skills, abilities and knowledge of high achieving senior women.The SWIM Program consists of three placements of three to four months duration within government agencies and private companies. Participants are required to complete coursework throughout the Program.Currently there are two ISR officers on the Program. The Department provides salary and course fees for both women.