1999-11-233914REPS1235901999-11-23Mr SPEAKER(Mr Neil Andrew) took the chair at 2.00 p.m., and read prayers.Questions Without Notice123591235912359Beazley, Kim, MPMr BEAZLEYPE4BrandALP00—My question is to the Prime Minister and follows questions I asked him yesterday. Prime Minister, do you recall the Treasurer saying on 8 June 1999 that `high rollers should be paying money to the Australian tax authorities'? Is it not a fact that millionaire high rollers have their expenses paid for them by the casinos, meaning that they will pay no GST on airfares, hire cars, accommodation, entertainment, meals and other services such as massage and dry-cleaning and that a casino that does pay GST on these services will receive a full credit for it? How can you say these tax breaks for high rollers are fair when an Australian family from Kalgoorlie holidaying at the Burswood Casino in Perth, for example, will pay GST on their travel to and from Perth, taxis, accommodation, entertainment and meals? Why are you treating Australian families worse than millionaire high rollers?12359Howard, John, MPMr HOWARDZD4BennelongLPPrime Minister10—The answer to the honourable gentleman's question—and I do remember that he asked me about this yesterday—is that the answer I gave yesterday is the answer I give today: that is, that the structure of this tax is that you pay the tax on the margin. That is the way the tax operates, and what the honourable gentleman is putting forward completely misses the fact that the GST is applied on the margin. In reality the Leader of the Opposition is arguing for a tax on gambling winnings; that is what he wants. Why don't you go out to the working people of Australia and tell them that you want to tax punters' winnings? That is what you want to do.PE4BEAZLEYMr Beazley—In case you are unaware of it, you already are taxing them! You know, your own programs.10000SPEAKERMr SPEAKER—Is the Leader of the Opposition raising a point of order?PE4BEAZLEYMr Beazley—Yes I am, Mr Speaker. Yesterday I did ask a question that related to the amounts paid by the casinos to the high rollers, after they have lost, which are deducted from the margin. I was asking a question about that yesterday. But this question is not about that. This question is about the GST applicability to all their other benefits compared with that experienced by those Australian punters who are paying the tax on the margin, and the tax on everything else.10000SPEAKERMr SPEAKER—The Leader of the Opposition was conspicuously advancing an argument. Has the Prime Minister concluded his answer?ZD4Mr HOWARD—No, I have not, Mr Speaker; I have one or two things I would like to add. It is not within the capacity of any government to devise a taxation system that prevents one person, one group of people or one corporation in this country from relieving others of expenses they might normally incur. If the Leader of the Opposition is seriously suggesting that sort of a taxation system, then he has really taken leave of his responsibilities.While I am on my feet, I would like to add to an answer I gave yesterday to another question that was asked of me by the Leader of the Opposition. He referred to a question that I received on the Howard Sattler 6PR radio program from a lady by the name of Shirley. I did recall it and I did undertake to check the records.PE4BEAZLEYMr Beazley—Mr Speaker, I raise a point of order. There is an appropriate place at the end of question time for the Prime Minister to do exactly that. What we want now is an answer to this question: why are high rollers treated differently from ordinary Australians at casinos?10000SPEAKERMr SPEAKER—The Leader of the Opposition is right that it is the tradition of the House for answers to be added to at the conclusion of question time. I was merely, I thought, facilitating question time by allowing the Prime Minister to continue.ZD4Mr HOWARD—Mr Speaker, if he wishes to take the point, I am perfectly happy. I will do it at the end.10000SPEAKERMr SPEAKER—Consistent with what has been the tradition of the chair, we will add to former answers at the conclusion of question time.ZD4Mr HOWARD—That is fine by me.1236012360Moylan, Judi, MPMrs MOYLAN4V5PearceLP10—My question is addressed to the Treasurer. Would the Treasurer please advise the House of what additional steps the government is taking to assist businesses and the non-profit sector to prepare themselves for the new tax system?12360Costello, Peter, MPMr COSTELLOCT4HigginsLPTreasurer10—As is probably well known on this side of the House, one of the great things about the new tax system is that charities are GST free. That means that charities can claim back all of the embedded taxes in prices for things they buy that they currently have to pay for under Labor's tax system. Under Labor's tax system, the WST and fuel excise are embedded in prices and charities have to pay them. Because charities will be GST free under the new tax system, there is no liability on the services they provide and they get back every dollar of embedded tax in their prices. That is a great thing for the charitable sector.As part of the new tax system, the government will be increasing pensions. In advance of the introduction of the new tax system there will be pension bonuses and also bonuses for self-funded retirees. In addition, there will be vouchers available for the charitable sector to help them prepare. Just to give you an idea of some of the prices that are going for preparation in relation to GST, I read in the paper today that IBM and Primus are about to enter into an agreement with the ACTU. Millions of union and superannuation fund members will be offered IBM personal computers and Primus Internet access for less than $10 a week. Isn't that great! If you take that deal, for $12.95 you can have an add-on which will give you a home office bundle which intuits GST-ready quick books.So under the ACTU scheme, you can get GST ready for $12.95 a week. Isn't that great for the ACTU! At $12 a week—that is $144 a year. We thank the ACTU for helping their members to get ready for the GST and to do it at such a cheap price of $12.95. I do not normally spruik for the ACTU, but at $12.95, online, with a computer, ready for the GST! You would not need $200 to get that. You could get it down at the ACTU for about $144.In addition, $10 million has been provided to community groups so far to help them with the implementation of the GST. The Australian Taxation Office is providing an awareness seminar for the non-profit sector commencing on 29 November. The government has a charity consultative committee which is working with the industry to help them get ready. The tax office has a tax reform information booklet and on the web site at www.taxreform.ato.gov.au there are provisions for the non-profit sector. This is a great step forward for the non-profit sector. For the first time ever, all taxes will be cut back and embedded in prices—never offered under the Labor Party—and there will be pension increases, bonuses, vouchers and, in additon to all that, help to set up the systems which will bring Australia's taxation system into the modern era and take it away from Labor's fascination with a 1932 tax system now well out of date in advanced countries around the world.1236012360Swan, Wayne, MPMr SWAN2V5LilleyALP00—My question without notice is directed to the Minister for Community Services. Minister, will you confirm that, following your speech to the ACROD national conference last week, you were asked whether there was a requirement that the GST would be applied to government grants to community organisations? Is it true you replied, `No, there is not,' and when quizzed again you said, `No, I'm definitely right'? Will you confirm you subsequently discovered that grants would indeed have a GST applied and requested a statement be read out to the conference admitting you were wrong? If you do not understand how the GST will impact on charitable organisations, how do you expect charities to administer the GST?12361Anthony, Larry, MPMr ANTHONYXJ6RichmondNPCommunity Services10—Mr Speaker, if the member for Lilley had been at the ACROD conference, he would have heard, as he mentioned, that I read out a statement. Obviously, there have been constant negotiations with the government and with the Democrats, but I make the point that it is likely that any grant made by the government to charities will be subject to a GST. The grant would be adjusted to incorporate this and the charity would remit the GST component to the tax office. As the Treasurer succinctly pointed out, if it is a non-commercial service, particularly in relation to services from charities, the GST will not be charged.1236112361Lawler, Tony, MPMr LAWLER834ParkesNP10—My question is addressed to the Minister for Immigration and Multicultural Affairs. Is it correct that all immigration detention centres are at full capacity? Will this affect the government's ability to maintain the policy of mandatory detention for illegal arrivals?12361Ruddock, Philip, MPMr RUDDOCK0J4BerowraLPImmigration and Multicultural Affairs; Minister Assisting the Prime Minister for Reconciliation10—I thank the member for Parkes for his interest in detention facilities and the maintenance of the policy on mandatory detention of illegal arrivals. I confirm that our facilities are running close to full at the moment. The department continually reviews its contingency plans so that we can match our capacity with the requirements of detaining people who arrive in Australia unlawfully. As part of our planning, we reopened, at the Curtin air base near Derby, Western Australia, the facility that was last used in 1995. It was recommissioned on 26 September and is now close to full.We have the new facility that is being prepared at Woomera in South Australia. The plans there are well advanced. The Woomera site comprises 21 brick accommodation units which initially will be able to accommodate 400 people and is able to be expanded if necessary. The first detainees will be able to be accommodated early next week. The services are delivered for us by Australasian Correctional Management. The cost of estab lishing Curtin and Woomera is about $10 million. At the current rate of arrivals, just feeding and housing alone will cost in the order of $100 million this financial year. Other programs within my portfolio add to the cost. If we do not have additional arrivals—and that is highly unlikely given the pipeline that we are aware of—it will come to around $150 million. Other agencies also have increased costs.There should be no doubt that the commitment to mandatory detention remains. Costs are incurred whether people are within the community or detained. I do not know of any organisation that ultimately would not say that the government had some responsibility to keep people if they were released into the community, but you would also have other costs that would be considerable, including location costs, if you were going to remove people in addition. Besides, it would be very irresponsible if you were to release people without knowledge that they meet appropriate health, character and security assessments and had a lawful entitlement to be in Australia.The cost of locating people who have been entering Australia unlawfully by releasing them is well beyond the costs that I think would normally be involved in continuing to keep them here in Australia. They are matters on which I would take advice. I could also add that if you were releasing people into the community, that would be exploited by the people smugglers and would only lead to a very significant additional increase over and above the numbers that we have now seen arriving in Australia.For this reason, the government will continue with its policy of mandatory detention and I hope we will continue to enjoy bipartisan support for mandatory detention—it has been bipartisan for a number of years. I assure the House that the government will provide the resources to ensure that we are able to maintain that policy effectively.1236112361Crean, Simon, MPMr CREANDT4HothamALP00—My question is to the Treasurer. I refer to your $200 GST gift voucher for Australian small businesses. Will this grant be taxable?12362Costello, Peter, MPMr COSTELLOCT4HigginsLPTreasurer10—It will not be taxable. To describe it as a gift voucher is perhaps overstating the case: I know it is Christmas time—Mr Fitzgibbon interjecting—CT4Mr COSTELLO—It is basically an opportunity for small business. I do not think we have actually announced an amount, so I am not conceding amounts for the moment. There was very good consultation by the Minister for Employment, Workplace Relations and Small Business. He spoke to small business, and they recommended that they be given the opportunity to purchase assistance. We will be able to take that one step further. We will actually be negotiating with preferred suppliers for discounts. We will be able to say to small business, `If you go to preferred suppliers, you can get discounts and you can apply a government grant to the cost and, in addition to that, the remainder of the cost is fully deductible if you do it before 1 July 2000.'Mr Fitzgibbon interjecting—10000SPEAKERMr SPEAKER—The member for Hunter is defying the chair.CT4Mr COSTELLO—There is a real incentive to go out and do it by 1 July 2000 because not only can you have a preferred supplier and government assistance but also you can get full deductibility. Of course, under Labor Party rules, if you bought new equipment to deal with wholesale sales tax, stamp duties, financial institutions duty, bank account debits tax or higher income taxes, that would be a capital item which would be depreciable over the life of the item. This is fully and immediately expensible with a full tax deduction. If you put that together with the changes for small business that mean that they get input tax credits plus the changes—if the Labor Party can finally make a decision; I know it is a big ask—which would reduce capital gains taxes—Opposition members interjecting—CT4Mr COSTELLO—We know you are against reducing capital gains taxes for small business. There would be half capital gains taxes and rollovers for 15-year assets, and small business would have great opportunities in this country. That is the kind of tax system that the small business community has been asking for for a very long period of time. It will be a great thing for Australia, good for our exporters and, what is more, good for economic growth. So let's get on and create a new taxation system.1236212362Gambaro, Teresa, MPMs GAMBARO9K6PetrieLP10—My question is addressed to the Deputy Prime Minister and Minister for Transport and Regional Services. Would the Deputy Prime Minister inform the House of the new port of Brisbane motorway project? How will this project assist Australian industries, create employment and provide efficiencies in the transport sector?12362Anderson, John, MPMr ANDERSON4K4GwydirNPDeputy Prime Minister10—I thank the honourable member for her question and acknowledge her interest in the project. On Saturday last I, along with the Queensland Premier, launched the port of Brisbane motorway project. This is a project worth some $111 million in total. The Commonwealth contribution is $44 million, and that will go to linking the national highway to the port of Brisbane. This is a very welcome development indeed. In fact, it is unique in Australia. No other Australian location can claim a grouping of air, sea, rail and road interchange facilities all on one site in an area where there is an abundance of land—some one thousand hectares or so—for further port development, new business and so forth. I think that this fully integrated interchange facility can make a very substantial difference not just locally in terms of the potential for jobs in that part of Brisbane but, in total, there will be an estimated improvement in the jobs outlook in south-east Queensland of around 30,000 new jobs.I think it is also true to say that it takes us further towards the point in this country where ports compete with ports, to the great advantage of all exporters. It is one thing to point to our outstanding record in waterfront reform, but each port is in fact a chain with several linkages in it—from freight forwarders through to government instrumentalities, road and rail interchange and what have you—and what you really need to do to make one chain at a given port compete effectively and reduce costs to the greatest degree possible is make it compete with another port. What we have seen here is a commitment to the federal government to further efficiencies and further competitiveness for our export sector. This will be the largest urban renewal project at a local level in Brisbane since World Expo 88 revitalised South Bank a decade ago. It is worth making the point that it capitalises on other initiatives in the region, including the $3 billion—$3,000 million—reconstruction of the Pacific Highway between Brisbane and Newcastle and a range of other very important infrastructure projects that are making a real difference.1236312363Fitzgibbon, Joel, MPMr FITZGIBBON8K6HunterALP00—My question is to the Minister for Employment, Workplace Relations and Small Business. Has the minister seen comments attributed to Deloitte Touche Tohmatsu tax partner, John Cohen, who said with respect to small business and the GST:It will be like doing your annual tax return every month or every quarter. If you've got all the information at hand it will take an hour or two. If you have to go chasing it up, that will mean you are looking at a day or longer.Minister, do you believe that the Treasurer's $200 voucher will adequately compensate small firms for their lost weekends?12363Reith, Peter, MPMr REITHWI4FlindersLPWorkplace Relations and Small Business10—Obviously the honourable member has never been in small business. He ought to listen to his wife, who reckons that unfair dismissal laws ought to be changed for small business. I have not seen those comments, but I can tell the House that when we had the Bell committee going around the country asking about tax compliance—and obviously working on the system that Labor had when in office—I think their report was that it would take three or four hours a week to comply with Labor's tax system. So, if this bloke is reckoning one hour a week, I can tell you that that is a big improvement.8K6FITZGIBBONMr Fitzgibbon—Mr Speaker, I rise on a point of order. I had 10 years in small business and my former partner tells me that his compliance—10000SPEAKERMr SPEAKER—The member for Hunter will resume his seat. That was not a valid point of order, as the member for Hunter is aware.WI4Mr REITH—I think he has a lot of explaining to do to the small business community as to why he does not support halving the capital gains tax, which, I can tell you, a lot of small business people would like to see.8K6FITZGIBBONMr Fitzgibbon—Tell us about the voucher.WI4Mr REITH—The good thing for everybody else is that, with good policies for small business, they go out and create jobs, which is one of the reasons that we want to see the small business community getting a much better tax system. As we know, the small business community has strongly supported tax reform and there are a wealth of benefits for the small business community in the changes that we are introducing. Obviously there will be transition costs for small business.8K6FITZGIBBONMr Fitzgibbon—How much?10000SPEAKERMr SPEAKER—I warn the member for Hunter.WI4Mr REITH—People are going to have to get used to a new way of doing things. Clearly, that is far preferable to sticking with an old system which has penalised small business and job creation generally. We have a very comprehensive program in place. I think it is true too that small business people are now starting to turn their minds to GST implementation, which is a good thing. We have the biggest information and education program ever implemented in Australian political history in respect of putting the necessary information to the small business community. We believe that we are making real headway.I note that the ACTU have just done a deal to make sure that every worker has access to the Internet. On the system that they are putting in place people will be able to have access to the software necessary for the GST. So even the ACTU are getting in on it.1236312363Gash, Joanna, MPMrs GASHAK6GilmoreLP10—My question is addressed to the Minister for Education, Training and Youth Affairs. Minister, would you inform the House—Opposition members interjecting—10000SPEAKERMr SPEAKER—When the House has come to order I will recognise the member for Gilmore.AK6Mrs GASH—Thank you, Mr Speaker. Minister, would you inform the House of the progress made by the states and territories in improving their training systems through the Australian National Training Authority agreement? What impediments exist to this process?12364Kemp, Dr David, MPDr KEMPBT4GoldsteinLPEducation, Training and Youth Affairs; Minister Assisting the Prime Minister for the Public Service10—I thank the member for Gilmore for her question. I acknowledge her wonderful dedication to creating opportunities for the young people in the electorate of Gilmore. This government believes in expanding opportunities for Australians to lift their skill levels by accessing quality education and training. The purpose of the current Australian National Training Authority agreement has been to expand places in TAFE. In order to achieve this the Commonwealth, with the states—despite the tremendous fiscal problems that the Labor Party left us with—has undertaken to maintain spending in real terms if those places are increased. At the start of the agreement it looked as though we might be able to get an increase of some 70,000 extra places in TAFE. I am pleased to inform the House that it now appears that under the current ANTA agreement this increase is likely to be 160,000—160,000 additional places in TAFE for Australians. This reflects the commitment of the great majority of the states and territories—Mr Lee interjecting—10000SPEAKERMr SPEAKER—The member for Dobell!BT4Dr KEMP—to education and training opportunities for their citizens. There is only one dull spot in this record, and that is the Carr government in New South Wales.Mr Lee interjecting—10000SPEAKERMr SPEAKER—The member for Dobell is defying the chair.BT4Dr KEMP—The largest state training system has managed to deliver a miniscule increase in curriculum hours of about 1.3 per cent over the whole period of the current ANTA agreement, compared with an average of 9.3 per cent across Australia. Had New South Wales performed at the same level as the other states and territories there would now be another 30,000 places in TAFE in New South Wales. That is an appalling failure on the part of the Carr government. In addition, during the period in which the Commonwealth has been maintaining spending in real terms, the Carr government has been cutting spending on TAFE. In 1998, the New South Wales government cut its recurrent spending by over $8 million, according to the official statistics of the NCVER. All the evidence is that the Carr government has continued to run down TAFE expenditure in New South Wales and it is falling in real terms.What this demonstrates is that there is a lack of commitment on the part of the Carr government to expanding opportunities. What this country needs are governments in all the states and territories that are committed to giving people the skills that Australia needs to get jobs and to compete in the world. This government is committed. Let us see the same level of commitment on the part of the Carr government.1236412364Crean, Simon, MPMr CREANDT4HothamALP00—My question is again addressed to the Treasurer. Treasurer, what taxes, levies and charges have you exempted from the GST?12364Costello, Peter, MPMr COSTELLOCT4HigginsLPTreasurer10—We have made it entirely clear throughout this process that the GST will not apply to taxes where there are fees for services—that is, a discrete service is rendered that is considered a charge. The GST applies to the delivery of goods and services.1236412364Elson, Kay, MPMrs ELSON6K6FordeLP10—My question is addressed to the Minister for Health and Aged Care. Would the minister inform the House of the rate of measles notification in this country. What have been the results of the government's measles control campaign and the impact on the notification rates?12364Wooldridge, Dr Michael, MPDr WOOLDRIDGE8E4ChisholmLPHealth and Aged Care10—I thank the honourable member for her question. We have some very good news on measles notifications around Australia. In 1993-94, we reached the peak of notifications, with 9,500 children being notified as having had measles. This, for a disease for which there has been a readily available vaccine since 1968, is completely unacceptable. It peaked in Queensland in 1994, with nearly 2,500 cases of measles and in New South Wales the year previously with 2,300 cases of measles.So far this year, we have had under 270 cases of measles for the whole of Australia. Queensland, which at its peak was 2,500, is now 30. New South Wales, at its peak over 2,300, is at 75. This is even more impressive when you consider that Australia was informed by the World Health Organisation that around this time we could expect a measles epidemic. In Victoria earlier this year, we had a very small outbreak in teenage children, with less than 100 cases. This would have gone on to a full national epidemic. The University of Sydney has estimated that 17,500 people would have got measles.This change is due to the measles eradication campaign that we ran last year between August and November. I now have the evaluation of that. It is the largest national public health campaign we have run in Australia since 1956, which was our last polio vaccination campaign. The National Centre for Immunisation Research has judged the campaign an outstanding success. About 1.7 million children five to 12 years of age were vaccinated during this three-month period. That is 96 per cent of all children. That was done with individual parental consent for each case. About 1.3 million of these children were vaccinated in 8,800 schools around Australia. A sero-survey after the campaign, where we test the blood and look for the level of immunity, showed that in six- to 12-year-olds 94 per cent are now immune to measles compared with 84 per cent prior to the campaign.We took adverse events very seriously because this is something that is often raised in cases of vaccination. In 1.7 million vaccinations, we had 89 adverse events. However, half these were not serious enough to seek medical or other health attention. So the chances of having an adverse event that will require you to see a doctor or go to a hospital were one in 38,000. This is an extraordinarily low rate of adverse events and shows that this concern was unfounded. I am pleased to be able to inform honourable members that, of the children who have had adverse events, all have made a complete recovery.The campaign is the most successful public health campaign we have run in over 40 years in this country. It was a very complex campaign requiring state governments, territories, doctors, other immunisation providers and schools to all work together with the support of groups such as Rotary International. I would like to thank them very much. We have all worked together and we have beaten measles.ZD4HOWARDMr Howard—Well done, Mike.1236512365Beazley, Kim, MPMr BEAZLEYPE4BrandALP00—My question is addressed to the Treasurer. Are you aware of the latest assessment of the Macquarie Bank that inflation will hit over six per cent in the third quarter of next year, with the GST to add 3½ per cent to the underlying inflation rate? What is your revised assessment of the initial impact of a GST on inflation?12365Costello, Peter, MPMr COSTELLOCT4HigginsLPTreasurer10—I made a statement on this last week. I said that the government expects that underlying inflation would average in the year 2000-2001 at 2½ per cent, that the one-off price impact in that year from tax changes would be 2¾ per cent and that the CPI for that year would be 5¼ per cent. That is the first round effect in relation to the GST. Thereafter, prices would begin falling as embedded taxes are taken out. The overall price effect is less than the long-term overall price effect that the government indicated at 1.9 per cent. From memory, it is 1¾ per cent, which is actually less than what was put out during the election campaign at 1.9 per cent. Admittedly, there have been changes in relation to the coverage of the GST as a result of changes negotiated in the Senate and the consequences that were put together.In relation to the Macquarie Bank, no, I have not seen the Macquarie Bank surveys. I think most of the private sector forecasters believe that those put out by the Treasury are generally more accurate. Certainly the ones I put out are those put together by the Treasury. The underlying inflation rate of 2½ per cent for 2000-2001 is still well within the range that the government has been targeting of two to three per cent. The government has outperformed that range essentially since it came to office.Inflation has averaged in the one per cents since this government came into office. Compare that with the 1980s. During the decade of the 1980s—DT4CREANMr Crean—John Howard's time.CT4Mr COSTELLO—As I recall, from the beginning of 1983 we were under a Labor administration and inflation averaged 8.2 per cent for the whole decade. While we are thinking about it, at the end of that decade, in 1990, as I recall, unemployment peaked at 11.2 per cent. The then minister for employment was the Leader of the Opposition.He has a record—11.2 per cent unemployment—so they made him finance minister. In his two years as finance minister—his reward for all of his great efforts on unemployment—he accumulated in two budgets $23,000 million of deficit. That is a record which may never be equalled by a finance minister in Australian history.1236612366Secker, Patrick, MPMr SECKER848BarkerLP10—My question is to the Minister for Agriculture, Fisheries and Forestry. Many farmers in my electorate have benefited from the income support available through the government's Farm Family Restart Scheme. Can the minister advise the House of any progress to date of this important scheme and of any recent enhancements to the scheme?12366Truss, Warren, MPMr TRUSSGT4Wide BayNPAgriculture, Fisheries and Forestry10—May I thank the honourable member for Barker, who raised this issue with me during a recent visit in his electorate. The Farm Family Restart Scheme has certainly been a successful innovation by this government to assist farmers during periods of crisis. Previously, when difficult times came, farmers were often pressured to make a decision about the future of their family farm without professional assistance and with no breathing space to overcome their business problems or to address the social impact of the decisions they needed to make. There was really no effective safety net available for farmers in hardship.With the Farm Family Restart Scheme, this government has addressed the problem and provided income support for farmers for up to a year in these circumstances, supplemented with professional business advice. Farmers have also had access to social security benefits such as the health care card. Where farms are no longer viable, farmers can choose the option of a re-establishment grant worth up to $45,000 to help establish themselves in a future off the farm.The final date for applications for these re-establishment grants was due to be next week. I am pleased to inform the House that the government has decided to extend the application date for the re-establishment grants until 30 June 2000. Already, almost 3,000 families have taken advantage of the Farm Family Restart Scheme, and 240 farmers have been able to access the re-establishment grants. This extension of the date will help more farmers to take advantage of this excellent program which has certainly provided real help to people in rural communities facing major difficulties. I thank the honourable member for Barker for his interest in this issue.1236612366Crean, Simon, MPMr CREANDT4HothamALP00—My question is to the Treasurer. Treasurer, your original GST package with all food taxed claimed an inflation impact of just 1.9 per cent. Now, even though you have taken some food out, you are claiming a 50 per cent increase in the inflation impact, lifting the rate to 5.25 per cent. What specific price categories have you revised upwards, and when will you release this information?12366Costello, Peter, MPMr COSTELLOCT4HigginsLPTreasurer10—Obviously the question was written. The answer was given just a moment ago and he did not think to change the written question. As I said, the comparable CPI figure has been revised down, not up—down to 1¾. The figure was 1.9. It is no revision upwards if it comes down to 1¾. To put it in decimals, just so you understand, 1¾ is 1.75, and 1.75 is less than 1.9; 1.9 is greater than 1.75 so if you revise it from 1.9 to 1.75 you are revising it down. As I also said in answer to the last question—but of course that was written by one of your staff before they heard the last question, and you asked it notwithstanding—one of the principal reasons for that was the exclusion of food. It came down from 1.9 to 1¾, principally because of the exclusion of food. That is the effect of the package—1¾.There is another point which we have also always made clear. Again, I made it clear in a speech last week which you may have missed because you were in Paris at the Socialist International meeting with French socialists who have a value added tax and German socialists who have a value added tax and British socialists who have a value added tax. In the speech I made last week which you may have missed and which may not have been reported at the Socialist International conference in Paris—although I am surprised Jospin did not get up and refer to the support in Australia for a GST—I also made the point that with the impact of a GST the full price impact takes effect and then, as the embedded taxes are removed in relation to wholesale sales tax and others, the reductions flow through. So you have the cost impact flowing through initially and then over a period of time embedded taxes coming back. As was always made clear in the ANTS package and in the Senate inquiry, after the full package has taken effect the comparable figure to the 1.9 is 1¾.1236712367Charles, Bob, MPMr CHARLESOT4LaTrobeLP10—My question is to the Minister for Foreign Affairs. Could the minister advise the House about the Destroy-a-Minefield initiative launched by the government today?12367Downer, Alexander, MPMr DOWNER4G4MayoLPForeign Affairs10—I thank the honourable member for La Trobe for his question and for his interest in this issue, which I think concerns all members of the House and the Australian community—that is, doing what we can as a country to try to get rid of the scourge of landmines. We have signed the Ottawa treaty. We were amongst the first countries to sign that treaty, which has now been signed by 136 countries, to get rid of landmines and we have begun the process in Australia of destroying the landmines held by the Australian Defence Force.Today I took the opportunity to launch the government's initiative Destroy-a-Minefield. This is a scheme which will enable all Australians—individuals, schools, community groups, businesses and other types of associations—to make a direct contribution to alleviating the suffering caused by landmines. The scheme will be focused on Cambodia, the country in our part of the world which is the worst affected by landmines. It will enable various community groups to adopt active minefields selected by the United Nations as having a high priority for clearance.Funding raised by the community will be matched by contributions from the federal government. The contributions from the federal government will come from, inter alia, the sales tax revenue raised from Elton John's Candle in the Wind CD, which was released at the time of the death of Diana, Princess of Wales. For every $2 raised by the public, the Commonwealth government will match that with a further $1. This campaign is estimated to raise something in the vicinity of $1.2 million.Mr Speaker, I would like to take the opportunity to say in front of all members of the House that I would like all members in their individual electorates to promote this Destroy-a-Minefield campaign. Frankly, whether your electorate is a Liberal electorate, a National electorate, a Labor electorate or an Independent electorate—I think I have covered the waterfront there—there will be a genuine concern about the issue of landmines and there will be a strong feeling amongst people that they would like to contribute. I would urge all members to make a contribution. A kit will be sent around to members to help them with the launch of the program.1236712367Beazley, Kim, MPMr BEAZLEYPE4BrandALP00—Mr Speaker, my question is to the Deputy Prime Minister and Minister for Transport and Regional Services. Does he recall the Treasurer's GST guarantee that, `The government's proposed new tax system will not lead to any increase in petrol prices'? Is it not a fact that the GST will increase the pump price in all cases where petrol already costs more than 80c a litre? In light of the fact that many metropolitan and regional stations are now selling petrol at over 80c, do you stand by your government's guarantee that the GST will not increase petrol prices anywhere?12368Anderson, John, MPMr ANDERSON4K4GwydirNPDeputy Prime Minister10—Mr Speaker, this is a good question from the people who constantly raised the price of fuel for regional Australians and who knew no approach to fuel other than to continually jack up the price.PE4BEAZLEYMr Beazley—Mr Speaker, I raise a point of order on relevance. He was asked a specific question. When petrol reaches 80c the effect of the GST is to increase the price. I want to know his views on that.10000Mr SPEAKER—The Leader of the Opposition knows that it is quite impossible, within a matter of five seconds I think—Government member interjecting—10000Mr SPEAKER—14 seconds, I am corrected—to determine whether or not an answer is relevant to the question.4K4Mr ANDERSON—We would do well to recall the 1993 election, when we were promised that they could—PE4BEAZLEYMr Beazley—Mr Speaker, I again raise a point of order on relevance. It has got nothing to do with the 1993 election. The effect of a GST is to increase petrol prices. We want to know what he is going to do about it.10000Mr SPEAKER—I will listen to the answer.4K4Mr ANDERSON—In light of all of this I have to say that we are still waiting for their new-found spokesman for the bush to repudiate the claim of the member for Dickson—PE4BEAZLEYMr Beazley—Mr Speaker, I raise a point of order.10000Mr SPEAKER—If this is a matter of relevance—PE4BEAZLEYMr Beazley—My word it is, Mr Speaker.10000Mr SPEAKER—then I am quite happy for the Leader of the Opposition to resume his seat and I will so rule. The minister understands the obligation he has to answer the question and I call on him to do so.4K4Mr ANDERSON—Thank you, Mr Speaker. This is directly relevant because it comes to the point that he has failed to repudiate the claim by the member for Dickson that our cut to diesel fuel excise—our cheaper fuel—is nothing more than a boost to pollution.5I4McMULLANMr McMullan—Mr Speaker, I raise a point of order. The minister is blatantly defying your ruling calling on him to answer the question. If he cannot answer the question, why doesn't he just say so?10000Mr SPEAKER—Members on my left would facilitate the chair enormously if they were silent enough to allow me to listen to what the minister has to say. I will, as the chair always has, require the minister's answer to be relevant to the question.4K4Mr ANDERSON—Mr Speaker, from that I highlight the fact that our objective with tax reform is to reduce the price of fuel. The price of business fuel in this country will be reduced and there is no need for the price of petrol to rise.1236812368Nelson, Dr Brendan, MPDr NELSONRW5BradfieldLP10—Mr Speaker, my question is addressed to the Minister for Financial Services and Regulation. Can the minister inform the House of any recent prosecutions following the government's monitoring of GST profiteering?12368Hockey, Joe, MPMr HOCKEYDK6North SydneyLPFinancial Services and Regulation10—I would like to thank the member for Bradfield for his interest in this important matter. Mr Speaker, on 5 July this year a consumer rang the ACCC's GST hotline, which is 1300 302 502, and complained that a company called Australian Taxation Information Services, or ATIS, was distributing forms, which were very similar to Australian Taxation Office forms, to small businesses asking them to pay $175 for one year's registration or $295 for two years registration in order for them to secure an Australian business number. These forms were sent to 20,000 small businesses, including some in the electorate of the member for Bradfield. Businesses were misled into believing that ATIS was associated with the Australian Taxation Office and that these payments were necessary to register under the GST.On 16 July, the ACCC successfully prosecuted ATIS through the courts. They were fined $5,000 and the defendant, Michael Phillip Ivanoff, was ordered to write to all 20,000 businesses to inform them that ATIS had no association with the Australian Taxation Office and that the money would be returned. The defendant, Mr Ivanoff, failed to do this. Subsequently, he was prosecuted and has been sent to jail for three months. This is the first significant prosecution involving a GST scam. This reinforces the fact that people trying to take advantage of consumers during the conversion to the new taxation system will be severely fined and, if necessary, sent to jail. All Australian consumers will be watching carefully as Australian business helps to implement the new taxation system, and all Australian consumers will continue to police what is a far better taxation system than the hotchpotch provided by the Australian Labor Party.1236912369Crean, Simon, MPMr CREANDT4HothamALP00—My question is to the Minister for Transport and Regional Services. Minister, do you agree with the following statement from an advice to coalition candidates during the last election:There will be no increase in the price of petrol as a result of the GST.10000SPEAKERMr SPEAKER—I interrupt the Deputy Leader of the Opposition there. I am prepared to allow the question, but the question was prefaced with the words `Do you agree with the statement', which could be deemed to be seeking an opinion. I would therefore ask you, under standing orders, to rephrase the question.DT4Mr CREAN—Is it correct that this advice was sent to coalition candidates during the last election:There will be no increase in the price of petrol as a result of the GST. The reason is that the government will reduce the petrol excise by an amount equivalent to the GST.With average pump prices in regional Australia up to 90c a litre, by how much will you cut the petrol excise to ensure that no-one pays more for their petrol from the GST?12369Anderson, John, MPMr ANDERSON4K4GwydirNPDeputy Prime Minister10—I thank the honourable member for his question. I do not recall seeing that particular piece of literature. I cannot assume that it exists. It may or may not have existed. But we made it very plain that we would reduce the price of fuel by the estimated impact of the GST and that when the GST was then payable it would always be reclaimable by a business. The fact of the matter is that we are for cheaper business fuel. We are for arrangements in this country which will see the cost of delivering things to rural areas, including fuel, come down, not go up, just as we are for arrangements on fuel taxation which will mean the cost of exporting—which is what we do in rural communities—will come down. We are for lower fuel taxes. You are for higher fuel taxes. Your spokesman for the bush over there has failed.UU5HORNEMr Horne—Mr Speaker, I have a point of order. This was a specific question about petrol prices—not about fuel prices, not about prices that can be considered to be a business cost—and the minister should be asked to answer that.10000SPEAKERMr SPEAKER—Has the minister concluded his answer?4K4ANDERSONMr Anderson—Yes.DT4CREANMr Crean—Mr Speaker, I seek leave to table the advice which the minister says he cannot conveniently recall now.Leave not granted.1236912369McArthur, Stewart, MPMr McARTHURVH4CorangamiteLP10—I direct my question to the Minister for Trade. Can the minister inform the House of new export opportunities for Australia's automobile component manufacturers likely to flow as a result of the minister's trade mission to Thailand last week?12369Vaile, Mark, MPMr VAILESU5LyneNPTrade10—I thank the member for Corangamite for his question. I think that every member of this House recognises the interest that the member for Corangamite has always shown in Australia's automotive industries, particularly as one of Australia's significant exporters. We have seen in recent times some quite extraordinary results as far as the export of Australian automotive pro ducts across the world is concerned, particularly into South America and into the Middle East.I would like to inform the House that last week, along with the Minister for Foreign Affairs, I was in Thailand to participate in a joint ministerial meeting with our counterparts in Thailand, Dr Supachai and Dr Surin. As part of that, we took with us a delegation from Australia's automotive industry to conduct a joint automotive working group in Bangkok. The result of that mission was quite extraordinary, given the recent circumstances of the economies in South-East Asia. As a result of the automotive mission that we travelled with, the industry is set to deliver into Thailand additional automotive exports in the order of $40 million over the next 12 months to two years. We have also set up the prospect, as far as Australia's exports are concerned, of supplying gas conversion kits for nearly 1,000 buses to the Bangkok Metropolitan Transit Authority fleet. That has come out of those discussions, with the opportunity to design and construct 175 new gas-powered buses for the new rail feeder service in Thailand.It was a very successful visit over a couple of days. The automotive delegation was led by the Prime Minister's special envoy for the automotive industry, Mr Ian Grigg, who is doing an excellent job in establishing linkages and facilitating business for the Australian automotive sector. Also, as part of the visit to Thailand, the Thai government has confirmed that from 1 January 2000 it will remove local content requirements from its automotive sector. Of course, whilst we were there both the foreign minister and I, in the bilateral discussions we had with our counterparts, pressed the point with the representatives from the Thai government with regard to the reduction of the automotive tariff barriers that exist in Thailand, and certainly we were given a very good hearing in that regard. We have seen the Thai government reduce dramatically the tariff barriers to a number of products this year. We feel confident that they will also do that in the near future for the automotive industry and that we will see more exports of automotive components and vehicles out of Australia into that all-important market.A point to finish on is that our Australian automotive industry have achieved these great outcomes under difficult circumstances—a difficult economy and a difficult economic climate in the region. But they have also done it while they are still carrying the burden of Labor's wholesale sales tax. Come the middle of next year they will be doing it with much less burden and they will be much more competitive as a result of the policies of our government.ZD4HOWARDMr Howard—Mr Speaker, I ask that further questions be placed on the Notice Paper .Miscellaneous123701237015:01:0012370Howard, John, MPMr HOWARDZD4BennelongLPPrime Minister10—I would like to add to an answer that I gave yesterday. I was asked by the Leader of the Opposition about a question I was asked on 6PR radio by a lady who called herself Shirley. I did remember that question and I did remember undertaking that, if Shirley sent me her contact details either directly or via the station, I would get her an answer. After the question asked by the Leader of the Opposition, I checked with my staff. There was no record of having heard from Shirley. My staff then got in touch with Howard Sattler's producer and were told by the 6PR station that both 6PR's address and our Canberra office address were provided to Shirley after she came off the air on 21 October. The Sattler program confirmed that they had received no correspondence. Checks within my office have found no record of correspondence from Shirley. After being contacted by the press office yesterday regarding the matter, Sattler's producer rang the phone number left by Shirley. There was no answer, simply a recorded message advising that the number had been disconnected.I am also told that Sattler's producer advised that she had taken a call from Mr Beazley's office yesterday afternoon requesting contact details for Shirley. All I can say, Mr Speaker, is that I would have been delighted if the lady—Opposition members interjecting—10000SPEAKERMr SPEAKER—Order! Will the House come to order! There is nothing that I have heard the Prime Minister say that justifies any particular interjection and I invite him to continue.ZD4Howard, John, MPMr HOWARD—If Shirley is listening, if she lets me know her address I will be very happy to write to her.Ministerial Statements123711237115:03:0012371Howard, John, MPMr HOWARDZD4BennelongLPPrime Minister10—by leave—Today I inform the House that the government has decided on the formation of two additional infantry battalions for the Australian Army as well as other force additions. These decisions flow directly from Australia's involvement in East Timor. I also report to the House on the impressive progress made to date by the INTERFET multinational force in East Timor, so ably and effectively led by Australia. Furthermore, I will explain the details of a temporary revenue measure, for the next financial year only, to cover the unexpected costs of the military deployment by our nation in East Timor.On 21 September, I advised parliament of the deployment of Australian troops as part of INTERFET, the multinational force mandated by the United Nations, to restore order in East Timor. I am pleased to report that, in the intervening two months, INTERFET has largely achieved the tasks the United Nations set it: to restore peace and security to East Timor, to protect the United Nations mission in East Timor and to facilitate humanitarian relief.In this period also, East Timor's political status was settled. On 19 October, the People's Consultative Assembly in Indonesia agreed to the separation of East Timor from the republic of Indonesia, thus respecting the vote East Timor's people freely exercised in the United Nations ballot on 30 August. East Timor is now under the transitional authority of the United Nations until its full independence is achieved in two or three years time. The day after its decision on East Timor, the assembly elected Abdurrahman Wahid as President and Megawati Sukarnoputri as Vice-President. These steps underline the enormous distance Indonesia has travelled towards democracy over the past 12 months.INTERFET's achievement of its mandate has been an outstanding success. It reflects very well indeed on Australia's leadership, the international support the force has received, the good cooperation among contributing countries and, above all, the professionalism of the service men and women in the force. Soldiers, sailors and aircrew from 17 nations are working together effectively. The force now numbers over 9,900, including 4,400 from Australia's coalition partners.Countries in Australia's region have made a strong contribution to INTERFET. The Philippines, Singapore, Thailand, Malaysia and South Korea are participating. Thailand has provided the deputy commander, Major General Songkitti, and the second largest contingent of forces. The government is particularly grateful to the Prime Minister and the people of Thailand for their support. We thank Japan, which, unable to commit troops for constitutional reasons, is providing $US100 million to pay the cost of developing country contributors to INTERFET. China has been supportive throughout the UN process. New Zealand's contribution represents its largest deployment of forces abroad since World War II, and I would like to express my particular thanks to Mrs Shipley for the leadership she displayed.Countries beyond the immediate region have also made a substantial contribution to INTERFET. The United States has provided capabilities which are essential to the mission's operations and would otherwise have been difficult to secure. Its ready support for Australia's leadership of INTERFET has underlined the effectiveness of the ANZUS alliance. We were grateful for the United Kingdom's prompt response in sending a company of combat troops and naval assets at the very beginning of the operation. Canada, Brazil, France, Germany, Ireland, Italy, Norway and Portugal have all made valuable contributions. Denmark, Egypt, Fiji, Jordan and Kenya have committed to send forces.To date, INTERFET forces have sustained only two casualties. We were pleased and relieved that both these Australians are making a full recovery. There have also been six militia deaths and a number of militia casualties. This loss of life is regretted, but in each case the incidents did result from attacks on INTERFET. Since these events the security environment in East Timor has greatly improved. INTERFET has consolidated its control throughout the mandated area, including the Oecussi enclave. Dili is returning to normal life. More than half its displaced residents have returned, and work on rebuilding the city's shattered infrastructure has begun. The last Indonesian troops and officials left East Timor on 31 October.INTERFET's success in providing security has provided the basis for achieving its second and third goals: protecting the UN mission and facilitating the provision of humanitarian assistance. Humanitarian assistance is reaching all corners of East Timor, with greatly improved access for international relief agencies. The UN Office for the Coordination of Humanitarian Affairs, the Red Cross, World Vision, CARE, Catholic Relief, UNICEF, UNHCR and others now have operations on the ground. This financial year, the government has provided an initial $14 million in humanitarian assistance to East and West Timor. And yesterday the Minister for Foreign Affairs announced a further $23 million in humanitarian assistance. INTERFET has created the conditions for hundreds of thousands of East Timorese to return home and to start to rebuild their lives. The United Nations estimates that more than 88,000 displaced East Timorese have now returned.The government is still very concerned, however, about the plight of over 150,000 displaced East Timorese who remain in West Timor and are subject to intimidation by militia. The onset of the wet season makes their return home urgent. The government welcomes statements from the Indonesian government that militia groups are to be disarmed and removed from border areas, and that displaced East Timorese who wish to return are to be allowed to do so. Unfortunately, as yet this has only happened in some areas. The government will pursue this issue vigorously with the Indonesian government, the UN Secretary-General, other governments and the appropriate relief agencies.With security largely restored, the immediate priorities remain humanitarian: the return of internally displaced people and the rebuilding of their lives in East Timor. East Timor and the United Nations must also now begin work on reconstruction, reconciliation and nation building. On 25 October, the UN Security Council passed resolution 1272, which establishes a United Nations Transitional Authority, UNTAET, to prepare East Timor for independence and provides for a UN peacekeeping operation to take over from INTERFET as soon as possible. It is essential that UNTAET moves quickly to set up effective political, economic and social structures and that UNTAET involves East Timorese as much as it can in its work. The government warmly welcomes the appointment of Mr Sergio Vieira de Mello as head of UNTAET and looks forward to working closely with him. We are now discussing with the United Nations an early transfer from INTERFET to the new UN peacekeeping force, to be managed in a way that fully maintains East Timor's security. We expect this will occur early next year. INTERFET's role will end once it hands over responsibility for security in East Timor to the United Nations.I am sure both sides of the House, and indeed all Australians, will join me in warmly commending the force commander, Major General Cosgrove, and the Australian men and women serving with him in East Timor for the outstanding job they have done on our behalf and on behalf of the United Nations.UNKNOWNHonourable membersHonourable members—Hear, hear!ZD4Howard, John, MPMr HOWARD—All Australians were deeply distressed by the scenes of violence, death and destruction in East Timor that they witnessed daily after the results of the ballot were announced in early September. As I said in my address to the nation at the time, we sensed that a small, vulnerable community was about to be denied the freedom it had sought so long and that it had voted so overwhelmingly to achieve. Despite the pleas of the international community, the Indonesian government was unable to restore order and the United Nations authorised a multinational force to do so with the agreement of Indonesia.Australia acted because it was the right thing that we help protect East Timorese from appalling violence and destruction and also because it was in Australia's national interest to restore stability in East Timor. The mission was dangerous and the risks to our men and women were high, but the Australian people gave it their strong support. It represents our largest military involvement for more than 30 years. The Australian troops in East Timor are doing a splendid job and all of us are rightly proud of every one of them. Australia's military involvement in East Timor will not end with INTERFET. We will make a substantial contribution to the follow-on UN peacekeeping operation—in the order of 1,500 troops.Inevitably, such a commitment to East Timor has put added pressures on our Defence Force and the budget. In order to be sure that we can sustain our commitment to East Timor, the government has accepted a recommendation from the Minister for Defence, based on advice from the Chief of the Defence Force and the Secretary of Defence, to increase the number of fully operational infantry battalions in the Army from four to six for a period of two years. The Army's size will grow from 23,000 to 26,000. This increase is required to sustain Australia's involvement in the peacekeeping operation and to maintain acceptable levels of overall defence readiness.Although the extra battalions have been raised to meet the immediate East Timor requirement, they could be needed on an ongoing basis. A decision will be taken on this in the context of the government's defence white paper next year. Air Force numbers will also be increased by about 500, to just over 13,500, to allow for additional combat support personnel and the raising of an extra airfield defence squadron.The government estimates that the extra defence costs from the deployment of forces to East Timor, the raising of two new battalions and additional Air Force numbers will amount to $907 million in 1999-2000, the current financial year; $1.089 billion in the year 2000-01; and $901 million in 2001-02. After the transition from INTERFET to the UN peacekeeping operation, the United Nations will make some reimbursements. But these reimbursements will cover only a small portion of the costs of the deployment of Australian forces in East Timor and not the wider defence costs associated with that deployment.Australia's support for East Timor goes wider than our involvement in peacekeeping and peace enforcement. The government will make available $60 million during the current financial year to cover additional aid needs for East Timor. Australia's aid commitment for 2000-01 will be considered in the coming year's budget process. Other additional costs in 1999-2000, the current financial year, relating to East Timor include assistance to evacuees from East Timor to Australia, $35 million, and deployment of Australian Federal Police and police from other jurisdictions as part of the United Nations civilian presence, $26 million. Attached to this statement is a table setting out these additional costs.The government will present to parliament before the end of the year a special appropriation bill to cover the extra defence and aid expenses for the current financial year. The government's Mid-Year Economic and Fiscal Outlook has now been compiled and will be released in full by the Treasurer shortly. We know, however, from the details to hand what the impact of the additional cost of the East Timor operation will be on the budget balance both for this and subsequent years.The House will recall that I undertook some weeks ago to outline funding arrangements for the Timor operation when details of the mid-year economic outlook were available. This I am now doing. It is clear from these details that the cost of the East Timor deployment presents a particular difficulty in the next financial year commencing on 1 July 2000. At the time of the May budget the underlying cash budget surplus for 2000-01 was projected to be $3.1 billion. That figure has been significantly reduced by a number of developments.The major additional item was the further costs to the budget of $1.8 billion in the coming financial year—that is, 2000-01—for revisions to the tax package that were negotiated with the Australian Democrats to secure its passage through the parliament. Other necessary policy decisions and adverse variations to estimates have imposed further costs to the budget. These additional costs, combined with the delay in receipts from the sale of the second tranche of Telstra, have also led to slower debt retirement and higher interest repayments on outstanding debt, costing about $500 million in 2000-01. In the absence of East Timor, all of these extra costs could properly have been absorbed within the projected budget surplus for 2000-01.The defence expenditure relating to East Timor of about $1.1 billion in 2000-01, however, falls into a different category altogether. Such an extraordinary item of additional expenditure could not reasonably have been expected at budget time. Therefore a special provision must be made for its impact in the year 2000-01. The additional expenditure on the East Timor defence effort has a particularly severe impact in the next financial year. By contrast, in the current year and the year subsequent to 2000-01, even after East Timor costs have been allowed for, the budget is expected to remain in healthy surplus.As a result of the extra costs since last May, and in particular the unexpected defence costs relating to East Timor of around $1.1 billion in the 2000-01 financial year, it is calculated that, without additional measures, the budget in that year—that is, the year commencing 1 July 2000—will record an underlying cash deficit of approximately $500 million. The government is not willing for this to occur. The days of budget deficits should remain firmly behind us. The economic consequences of high deficits, particularly the pressure they place on interest rates, should be unacceptable to all honourable members. The government has decided therefore to introduce a temporary Defence-East Timor levy for 2000-01 only. This levy will be applied as an addition to the Medicare levy on the income of taxpayers earning above $50,000 a year.The levy will be set at 0.5 per cent for taxpayers with an income of between $50,000 and $100,000, and at one per cent for taxpayers with incomes above $100,000 a year. There will be appropriate shade-ins to smooth the impact on taxpayers earning just above $50,000 and $100,000. The levy will apply only for a 12-month period from 1 July 2000, ending on 30 June 2001.Applying the levy on incomes above $50,000 will protect low- and many middle-income earners. The levy will begin on the same date that tax cuts begin under the government's tax reform. It will reduce only slightly—and for only one year—the tax cuts that those taxpayers will receive. For example, a single taxpayer with an income of $60,000 a year will receive a tax cut of nearly $62 a week and the levy will reduce that for one year only by about $6 a week. With this approach, 80 per cent of all Australian taxpayers will receive their tax cuts in full from 1 July next year.The levy will collect approximately $900 million in 2000-01. That sum will substantially cover the East Timor defence costs arising in that year. After 2000-01, the East Timor defence costs can be absorbed by the budget whilst maintaining strong surpluses. The community, I hope, will support this measure as a fair and reasonable one to help fund the bulk of our defence costs relating to East Timor in 2000-01. The only alternative to this special and temporary levy would be further cuts in government spending.Given the expenditure savings of earlier years, the necessary funds of approximately $1 billion could not have been obtained without paring back in essential areas of social expenditure, such as health, education and welfare for the needy. The government does not believe it would be fair to do this. The levy I have announced is the fair and decent way to deal with this unexpected budget difficulty in the next financial year. There will of course be other requirements for Defence that do not relate to our involvement in East Timor, such as completing the submarines and other procurement decisions. These will be considered in the normal budget process and in the context of next year's defence white paper.Australians from all walks of life have responded sympathetically to the suffering of the East Timorese people, and I want to acknowledge the great willingness of so many individuals and organisations to help in different ways. In particular, Australian non-government organisations, including the churches, have played an important role. Australian business can also play a significant part. The government convened a meeting with business groups and aid agencies in response to the strong interest from the business community in helping with reconstruction. I warmly welcome the contributions already made or foreshadowed by the timber, construction, power and pharmaceutical industries. The Northern Territory government has also provided valuable help. Darwin will continue to serve as the principal logistics base for UNTAET in the period ahead.East Timor's resources are limited. Now that it is entering the phase of reconstruction and nation building, it will need a great deal of international support. Australia will act generously, but we cannot carry the full burden alone. The government is encouraging others to make substantial commitments. Even with international help, however, East Timor's future prosperity can ultimately be assured only by the East Timorese themselves. Only they can put in place the democratic, transparent and accountable political and economic institutions on which a viable state can be created.I was therefore pleased with the approaches Mr Xanana Gusmao laid out in my meeting with him in October. He is realistic about the challenges that face East Timor. His commitment to pursuing reconciliation is encouraging, and we hope he will work closely with UNTAET. He understands the importance for East Timor's future of a good relationship with Indonesia. President Wahid's readiness to meet Mr Gusmao in order to lay sound foundations for the future is also to be particularly welcomed. Australia's own relationship with Indonesia has been under some strain because of East Timor. Now that East Timor's status has been resolved, both sides can move on. Australia and Indonesia are neighbours, and it makes sense for us to cooperate closely. Australia has long been a good friend to Indonesia, and we gave it strong support during its recent economic crisis.Indonesia has a new democratic government and an elected president who has a record of commitment to human rights and tolerance and to economic and political reform. Both countries have important interests in common. I am confident that on the basis of mutual respect both of us can build a mutually advantageous and pragmatic relationship.Mr Speaker, let me conclude by again expressing on behalf of all Australians the immense pride we feel in the contribution of the serving men and women of our nation now in East Timor. The success of the operation thus far is a tribute to their skills and their professionalism. They are well trained, they are superbly led, and each day they bring great credit to this country and to those values in which we all believe.Although casualties to date have been thankfully limited, we continue to share the anxiety of family and other loved ones here in Australia for the safety of those serving in East Timor. We wish them all a safe return home. I present a copy of my ministerial statement, and I commend the statement to the House.15:30:0012375Reith, Peter, MPMr REITHWI4FlindersLPWorkplace Relations and Small Business10—I move:That the House take note of the paper.There is a table with the statement. Just for convenience, I seek leave to have the table incorporated in Hansard .Leave granted.The table read as follows—EAST TIMOR BUDGETARY COSTS ($M)(a)1999-002000-012001-022002-03TotalAustralian Defence Forces (b) Comprising:- —Deployment (c) —Investment (d) —Force expansion (e) —Tax exemption for ADF personnel (f) 907 431 135 279 62 1089 358 256 452 23 901 328 111 439 23 665 238 27 377 23 3562 1355 529 1547 131 Aid60---60 Civilian police for UN administration26---26 Provision of safehaven for refugees35---35 TOTAL COST102810899016653683 Estimated UN Reimbursement1811410676314(a) All figures are on an accrual basis.(b) Defence costs over the four year period are based on a planning scenario which assumes an ongoing deployment as part of the UN peace keeping operation. Actual spending will depend on the length of the UN peacekeeping operation while the ongoing need for the additional battalions will be examined in the Government's White Paper on Defence.(c) Extra Operational costs for the ADF.(d) Costs associated with upgrading and replacing major capital equipment for the deployment in East Timor and the expanded force.(e) Cost associated with raising 2 additional battalion groups and an extra air field defence squadron (around 3.500 personnel). This will ensure the deployment in East Timor can be sustained without impairing the overall readiness of the ADF.(f) The deployment involves a cost to the budget through the income tax exemption for pay and allowances of ADF personnel on eligible duty outside Australia.Motion (by Mr Reith)—by leave—agreed to:That so much of the Standing and Sessional Orders be suspended as would prevent the Leader of the Opposition speaking for a period not exceeding 27 minutes.15:31:0012376Beazley, Kim, MPMr BEAZLEYPE4BrandALP00—To begin with, let me convey the opposition's support for the proposals in the Prime Minister's statement, both those related to the force structure and the mechanisms put in place to pay for them. I should say that that, of course, is subject to our own internal procedures. We have had only a couple of hours to view the statement and the proposition, but I do not believe a different opinion will emerge from that process. We believe this statement to be consistent with Labor's strong support for INTERFET, for the ADF generally and for the people of East Timor in their hour of need. Can I say about the commitment that has been made by our soldiers to this point that I agree with the Prime Minister on everything he has said and the fact that they are deserving of the admiration and thanks of the Australian people for the task they have performed.The aspect of this statement that will attract the most attention is, of course, the Defence-East Timor levy, so I will deal with that first. Again, as I said, subject to our internal processes I indicate our in-principle support for that levy. This is consistent with our view that the troops must have everything they need in this deployment and that there are real questions for our Defence Force structure down the track. I add that we could not have had a better reminder of the need to ensure revenue neutrality in the business tax reforms, nor a better reminder for the need to pass the ongoing offsetting arrangements for the GST package. In his remarks, the Prime Minister referred to the fact that some difficulty has been created in the relevant year of the operation of this levy by the deal struck with the Democrats in the Senate in relation to the passage of the GST, some $1.8 billion.To complete the picture associated with that, I think I should add another figure—that is, the figure of the cost of the totality of the GST package to the budget in that year, which is $6 billion. There is a total overall cost to the budget in the operation of the first three years of the GST of $17 billion. There is no question at all that, in the absence of putting in place this particular set of proposals, this is a commitment that Australia could have done standing on its head. However, that is water under the bridge and we are obliged to deal with the reality that we now confront: that there will be a shortfall which will need to be made up in some way, and the mechanism that has been put forward, I would say, is about as fair a way as you could contemplate in making that up.Having said that, I go back to the point I made a little earlier that it is absolutely critical, given all the strains that will be on the budget and the need to maintain a surplus in the years forward, that the business tax package be revenue neutral. It is absolutely critical because incorporated in those estimates of that GST position are several billions of dollars associated with both the proposition of the government in relation to taxing trusts as companies and also in relation to dealing with the independent contractor matter. The Prime Minister's strictures with regard to the requirement to maintain surpluses ought to underpin diligent government attention to those two matters and the resistance by the government to what is obviously a pretty substantial campaign to get them to change their minds on aspects of it, if not on the totality of them. So we now all know the costs involved, at least in this particular area, of any particular backsliding and the extent to which it ties the government's hands in responding necessarily to an international crisis.As I said earlier, and as I have made clear on multiple occasions, we thoroughly support the INTERFET deployment in East Timor. We believe the professionalism of the ADF has been amply demonstrated throughout this deployment. I particularly agree with the Prime Minister's words when he talked about the quality of the training of the Australian defence forces and the way in which it prepared them for this task. This, of course, is a quality of training established over many years. Despite the fact that from time to time snide attacks are made on the capabilities of the defence forces, we have always been thoroughly aware of the capabilities and professionalism of the defence forces themselves. Invariably there will be an element of weakness in this or that item of equipment and it would have been better if there had been more ammunition and if training had been held in certain circumstance, but, by and large, these are criticisms at the edges and the underlying reality is that the capabilities and professionalism of our defence forces are very good indeed.It goes beyond that, too, particularly when you get to commanders like the excellent commander we have in East Timor. The political sophistication, the breadth of the education of members of our defence forces and the facility that they have to handle situations way beyond just simply those entailed in combat are something that Australian armed forces are noted for.The capability of the Australian armed forces ought to be recognised in that regard. They were recognised in the Prime Minister's statement and are now on display for the rest of the world to see. Also, it is important for us to emphasise that the task that is being performed by those defence forces that make up a substantial proportion of INTERFET is not an Australian task. There has been a mistaken belief out there that the Australian people are acting in their own interests, narrowly defined as far as East Timor is concerned. We are not.We are acting on behalf of international organisations in defence of principles that cut across all value systems and are global in their impact. We are acting on behalf of the defence of basic human rights: the right of people to self-determination, the right to the preservation of their lives and the right to develop themselves in communities free and secure. That is what the Australian armed forces which are associated with this United Nations deployment are acting on behalf of. It is very important that that is understood, not just in this country—where I think it is understood—but in a broader region around us, and that the ongoing commitment of the Australian Defence Force in that regard continues to serve those principles.Australia is continuing to make a commitment to that force, albeit under a different rubric now and at a different level, in the light of our understanding of our international obligations—again, no particular Australian interests are involved. The level of our support is not a product of Australian interest but a product of Australian proximity and understanding. The nations in the region that look at us, at the things we are doing and the contribution of the Australian Defence Force I hope will view our commitment in that light.In the mind of the Prime Minister and of the government, there does seem to be a notional timetable associated with all of this. Looking ahead of us, we seem to be talking about a timetable of around three years from where we now stand. We hope that there will be a successful conclusion to the task of this force and of the United Nations operation and the creation of a new independent government in East Timor, free of any problems, either internal or associated with its borders. It would be better that we come to a successful conclusion in that period. However, that may not be the case and there may need to be a preparedness on the part of this country to play these roles a little longer. We ought not necessarily set ourselves dates in this matter that we cannot meet or that may subsequently prove to be unachievable. There is going to be a need for governments, and oppositions for that matter, to convey to the Australian people that we see this as a long-term commitment that may have many twists and turns in it. While things have gone particularly well so far—better than I think anybody anticipated—this may not always be the case. There has to be a preparedness to see this job through until it is completed.The statement reveals an intention by the government to increase the full-time army from 23,000 to 26,000. I have not seen that additional statement. There may be answers in it to one or two of the points I am making, in which case we will have a chance to look at that a bit later. It is not absolutely clear from the Prime Minister's statement what this means both for the long term and in terms of recruitment for the Army to this point.When I left the Defence portfolio, from recollection the full-time Army was about 30,000 and the reserves had an approved level of about the same. The Army is well below that figure now although the Australian population is larger and the reserves are considerably below it. I understand there will be some statements made on this later, but I recommend to the government that they start to look very closely at the way in which short-term, full-time service might be provided with reservists, with attention given to call-out legislation. Current call-out legislation does not cover the situation of people in Timor. If the reservists are to be protected in terms of their employment and their capacity to be re-engaged, then there will need to be something done by the government in that regard. I commend to the government the legislation that we have moved in this place in picking up on that.The situation is now that it is not easy to sustain over a long tour the large numbers of full-time members of the Army in particular and the armed forces generally. The United States now is having massive recourse to reserves for their normal deployments, not just for emergency deployments. For example, I understand that in their activities in Kosovo the reserves have something like 40 per cent of the commitment to that activity. Those planes that were flown out when the United States provided us with logistic support were being flown essentially by reservists, as they pick up a few months flying here and there in the United States system and move out of their national guard activities straight into full-time employment for a shortened period.Australian employers are not used to dealing with this. They have not had this experience for a considerable period of time, in fact not since World War II. It needs to be recollected in regard to World War II that the initial successful resistance to the Japanese invasion of New Guinea and threat to Australia was in fact conducted by militia and not by members of the regular armed forces. That is probably the last point when we had that territory—it was certainly within what Australia then regarded as its own territory. That was the initial mechanism that we had for response to any particular threat that developed to the Australian community.If we count the full-time Army and the reservists together—as I believe we should—we ought to bear in mind that, at the beginning of World War II, there were something like 100,000 engaged in a population about half the size of Australia now. If you combine the reservists and full-time members now—and this is short of the government's proposed increase—there are 46,000 engaged. So it is not as though there has been in recent years a huge commitment to providing an army on a basis of historic comparison. I note in the nodding of the Minister for Defence and the Prime Minister that they are going to pick up one or two points in the legislation that we have put forward, and we would welcome that development. I think it is a matter of some profound regret to the member for Brisbane, who had a deal to do with it at the time, that the Ready Reserves were abolished when we left office, because you could guarantee that the Ready Reserves would be in Timor now, or a substantial element of them, had that not been the case.The statement goes further than the military provision. The statement also goes to a commitment of aid to East Timor. The government rightly says that others are to be involved in this and should be involved in this. I doubt very much whether that assistance for civilian purposes will stop at $60 million. Over the years there is going to be a long-term commitment to rebuilding Timor. The first $60 million is welcome, and there are other expenditures there as well, but I do believe there will need to be an adjustment in the aid budget to ensure that there is an ongoing commitment. Stacked up against other commitments that we have, that $60 million can be compared with what I think is still a total of around $300 million per annum which is provided to Papua New Guinea. That gives a rough equation with that. I would expect that Portugal would make a substantial commitment for a substantial period of time. I would expect that the European nations which have been providing Australian governments with constant advice on Timor over the years will also be making a substantial contribution to this over time.We have, of course, the rebuilding of physical infrastructure, but we also have, as a task facing the government of East Timor, not only the rebuilding of but also the development of political and social infrastructure. Part of Australia's support should be in the area of lending our expertise to the establishment of political and administrative institutions in East Timor—legal experts, public service experts, economists, finance experts and the like. There will be a local government gathering here in the course of the next week, and I think it would be a very good thing if the Minister for Regional Services, Territories and Local Government were to appear at that function and enlist the support of Australian local government in the provision of technical advice on the sorts of local infrastructure that would be required to keep matters proceeding smoothly in East Timor. It is an area that is devoted to essentially regional or provincial type administration, which is quintessentially local government type administration, and I think Australian local officials would have a good deal of advice to provide. Of course, if we were prepared to provide the funding underpinning of that general aid budget that the government is talking about, then it need not be expertise that comes at an expense to the Timorese people.In difficult times like these there are many people of decency and goodwill who emerge, and they are emerging in the international non-government organisations and in the Australian non-government organisations. There are also, I am afraid to say, just as many unscrupulous operators likely to emerge as well in the course of this. When an international crisis of these dimensions occurs there is always an assemblage of the usual spivs. There will need to be, I think, a degree of assistance given to Mr de Mello, whose appointment we welcome. From all reports, he is an excellent international public servant. There will need to be a degree of support given to ensure that, in what transpires, there is not a set of events which might occur in relation to aid packages and the build-up of the infrastructure in East Timor that causes countries which are supplying the assistance to have a degree of domestic difficulty because reasonable criticism is made of the efficiency and the integrity with which services are delivered. I know that Xanana Gusmao is very much seized by these matters. No doubt Mr de Mello will be seized by these matters as well, and we should be too.There are many diplomatic issues to be resolved here. The Prime Minister referred to a number of them in the remarks that he made, though some of them are a little beyond the scope of this statement. We on this side of the House welcome the involvement of the United States, firstly, in securing the diplomatic conditions for INTERFET's deployment in the first place and then in backing up that support with visits by senior American officials—the latest, of course, being that of Ambassador Holbrook. The United States's strong diplomatic presence has been indispensable in securing a dangerous environment not only for the people of East Timor but also for our troops on the ground.A further crucial question is the role of Indonesia in East Timor's future. Firstly, I would like to echo the recent words of Richard Holbrook in saying that Indonesia's reputation in the international community will depend to a significant extent on its role in East Timor's security. The new government of President Wahid has, to my mind, a magnificent opportunity to establish its international credentials around this issue by ensuring that there is an appropriate international investigation of the appalling activities which took place over the course of the first half of this year and well into September. President Wahid and his vice-president had nothing to do with these events, and they are in a very substantial position to be able to clear the decks as far as that is concerned on behalf of Indonesia. They now, of course, are directly in control and therefore they have a direct responsibility for the events which are now taking place in West Timor, for the transfer of populations back to East Timor and for the security of those populations whilst ever they are there in West Timor. Richard Holbrook drew the attention of the Indonesian government to the fact that the international community is watching that very closely.Of course, the new Indonesian administration has enormous problems on its hands—much broader problems than the problems that are associated with the affairs in West Timor. Therefore, as it gets international support for addressing those other problems and its own economic development issues, it is very much in the interests of the government that it secure from its officials, particularly its military officials in West Timor, an end to the violence against the people of East Timor who wish to come back to Timor, an end to the mayhem caused by the militias and an end to any activities by the militia subsequently against the polity which emerges in East Timor.The Prime Minister referred to Xanana Gusmao's willingness to see a path of reconciliation pursued. That ought to provide ample opportunity for those who have been associated with the militias to abandon their previous course and reintegrate themselves into the polity of East Timor on the basis of non-violence and the fact that a welcome has been extended to them by those who have suffered at their hands.That finally brings me to the question of the future of Australia's relationship with Indonesia. It is our task now to rebuild those relations. We have an opportunity to do so with the new government in Jakarta. President Wahid's election has opened the way for us to work quietly and slowly towards rebuilding relations. That process cannot be rushed. It is also not a process that can be accompanied by grandstanding, grand gestures or anything like that. It will not wash. It will not occur. We have to renew our efforts to develop a broad and multifaceted relationship, one built firmly on a wide range of institutional and people-to-people ties. This may mean that for the next six months there may be a set of circumstances in which we have to use a great deal of what might be described as `second-track diplomacy'—people-to-people diplomacy.We have in this country a huge array of people in the business community, the public sector, the universities and the education system generally who over the years have built up both contacts with Indonesians and massive expertise in the affairs of Indonesia and Australia's relationship with it. We have thousands and thousands of Indonesian students in Indonesia educated in Australia who have had basically good experiences of this country and bear our community no ill will. In fact, they bear our community a considerable good regard.We will have to quietly build around these individuals and organisations as well as doing the best we can diplomatically to restore the relationship. We should not have a great deal of expectation of it in the short term, but in the long term it is critical that we set back on track a good relationship between Australia and Indonesia. We have to support their transition to democracy and to respect for human rights and democratic freedoms amply demonstrated by the president and vice-president newly appointed in that country. They are values that they have espoused for years and years inside the Indonesian political system. They are values which are very readily identifiable with and ought to do the job as far as ensuring Indonesia's long-term development and internal security. We ought to be giving them whatever assistance we can in that regard.We have to acknowledge that part of the reason why we are experiencing a substantial difficulty with boat people coming to Australia at the moment—it is probably substantially the reason—is that a longstanding trend in Indonesian affairs to prevent those boats coming on has been replaced by a willingness to allow that infamous trade in human misery to take place and its extension, therefore, through to this country. We are getting an ample demonstration, I suppose, of what was one of the valuable aspects of the relationship that we once had with Indonesia in the circumstances in which we now find ourselves in relation to the boat people. But in that regard and in those days at the level of defence, the police, customs and the public sector, a good relationship was developed with Indonesian counterparts and interlocutors. There might be some attention by the Minister for Immigration and Multicultural Affairs in the first instance to start that rebuilding of the relationships by attempting to get back on track what was once a very good position in relationships between us.Finally, to get back to the forces who have been operating on our behalf and on behalf of the international community in East Timor, I join the Prime Minister again in congratulating them on a job extraordinarily well done. Major General Cosgrove in particular has proved himself both an excellent military commander and an excellent diplomat. I have confidence that the troops which will be rotated through subsequently will be every bit as effective. I hope that the command arrangements are such that that excellent situation can be continued, though of course the UN and the civilian administration now play a very different role as far as that is concerned. I look forward to an opportunity to see at least some of the troops next week and some of the others who are engaged in the task of rebuilding East Timor. I am looking forward to that visit enormously. I thank the Prime Minister for giving me and my colleagues an opportunity to do so. No doubt the Prime Minister will want to report on his own experiences with them when he gets back. I hope to do so myself.Debate (on motion by Mr Williams) adjourned.Questions to the Speaker123811238112381Bevis, Arch, MPMr BEVISET4BrisbaneALP00—Mr Speaker, in accordance with standing orders, I request that you write to the Attorney-General and the Minister representing the Minister for Justice and Customs in relation to questions I placed on notice on 7 June this year—questions Nos 705 and 708 respectively.12381Mr SPEAKERMr SPEAKER10000PON/A10—I have noted the request and will follow it through.Auditor-General's Reports123821238212382Mr SPEAKERMr SPEAKER10000PON/A10—I present the Auditor-General's audit reports Nos 15 to 20 of 1999-2000 entitled No. 15—Performance audit—Management of the Australian Development Scholarships Scheme—Australian Agency for International Development (AusAid) ; No. 16—Performance audit—Superannuation guarantee—Australian Taxation Office ; No. 17—Performance audit—Commonwealth-State Housing Agreement—Department of Family and Community Services ; No. 18—Performance audit—Electronic service delivery, including Internet use, by Commonwealth government agencies ; No. 19—Performance audit—Aviation safety compliance—Civil Aviation Safety Authority , and No. 20— Performance audit—Special benefit—Centrelink—Department of Family and Community Services .Ordered that the reports be printed.Documents1238212382Reith, 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.Motion (by Mr Reith) proposed:That the House take note of the following papers:Professional Services Review—Annual Report 1998-99Australian Institute of Marine Science—Annual Report 1998-99Employment Services Regulatory Authority—Annual Report 1998-99Department of Industry, Science and Resources—Annual Report 1998-99Defence Force Remuneration Tribunal—Fourteenth Annual Report 1998-99Seafarers Safety, Rehabilitation and Compensation Authority—Annual Report 1998-99Health Services Australia—Annual Report 1998-99Advisory Panel on the Marketing in Australia of Infant Formula—Annual Report 1998-99Australian Hearing Services—Annual Report 1998-99 Debate (on motion by Mr McMullan) adjourned.Matters of Public Importance123821238210000SPEAKERMr SPEAKER— I have received a letter from the honourable member for Lilley proposing that a definite matter of public importance be submitted to the House for discussion, namely:The severe impact of the Goods and Services Tax on the operation of charities and their delivery of services to the most disadvantaged AustraliansI 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—16:01:0012382Swan, Wayne, MPMr SWAN2V5LilleyALP00—This MPI highlights the impact of the goods and services tax on the operation of charities and their delivery of services to the most disadvantaged Australians. It can be said that the true test of a civil, just and democratic society is the way in which it treats its most disadvantaged members. It is the values of the community welfare sector—the values of cooperation, care and compassion—that make our increasingly divided society a bearable place to live. It is these values which temper the relentless opportunism of the market. It is really the Australian tradition that these values exist and temper that opportunism of the market.Until now, Australia has been held in high regard for the way in which we treat those who are down on their luck and have struggled to keep their heads above water. Indeed, the Australian way of life holds egalitarianism and a fair go as one of its foundations. One of the problems we have now is that these traditions are under fundamental attack. Not only have we had the biggest cuts to family and community services in Australian history—they are in excess of $2 billion—but we are now going to tax compassion in the community. We are going to tax the very organisations—the churches and the charities—that look after the most vulnerable.We live in a winner-takes-all society, unfortunately. One of the remaining traditions we used to value—these were highlighted by the member for Kooyong opposite only a couple of days ago—was the tradition of care and compassion for the most vulnerable. But this government is seeking to put a tax on that care and compassion and on the very organisations that are the place of last resort for all those who lose out in a winner-takes-all society. The very notion of doing that is obscene.What do we get today? The Treasurer comes into the House and says, `Don't worry about that. Don't worry that the GST applies to the community sector, the churches and the charities. We'll give them a seminar. That'll help them a lot. Or there is $10 million available for them.' He did not tell us that there are over 10,000 such organisations in our community and that much of that $10 million will be spent on training. It does not actually go anywhere near the organisations. The organisations themselves will be forced to bear the brunt of that activity.This is what the St Vincent de Paul Society has had to say about the great bargain, the terrific deal, that the Demtel Treasurer is going to give them. The St Vincent de Paul Society said on 21 October:Clearly under the current GST arrangements this organisation and others will have significantly less funds available for distribution to the poor and the disadvantaged, as there will be no rebates for some expenditures. More significant, however, is the unnecessary imposition of a complex administration designed for businesses and not charities placed on organisations which are not geared for those controls.Furthermore, he claimed that there will be this big bonanza; they will get the embedded costs back from the WST. They did not pay the WST. It did not take much organisation to deal with it, and that is precisely what the charities are looking for.St Vincent de Paul go on to say:If as we are told there was never any intention that we pay the tax in the first place, it is difficult to appreciate why we do pay the tax and then go through the complicated exercise of obtaining a rebate from the ATO. That is a very good point. Was it answered by the Treasurer today? St Vincent de Paul go on:It would be simpler, it seems to us, and probably for the ATO if the same arrangements or a similar arrangement as exists at present for the exemption of the WST was applied.Precisely! All the 10,0000 organisations are asking for is an exemption. Why do they want an exemption? It should not be applied to those organisations because we should not be taxing compassion. What does La La Larry have to say about it here today?10000DEPUTY SPEAKERMr DEPUTY SPEAKER (Mr Nehl)—Order! The honourable member might refrain.2V5Swan, Wayne, MPMr SWAN—Certainly. What does the Minister for Community Services have to say about that? It is his job to defend these organisations. He comes into this House today and admits that he went to the ACROD conference and he did not know that it applied to government grants to community organisations. Where has he been for the last year? What has he been doing? Has he been talking to anyone in his electorate? Has he spoken to the disability sector?The minister should talk to the member for Herbert. When I was in Townsville a few weeks ago, I was told by people at a community consultation that the member for Herbert did not know that it applied to the grants in the Townsville city council and to over 100 community organisations. Nobody in the government seems to know what they are doing, but they expect St Vincent de Paul, Lifeline and all the other thousands and thousands of not-for-profit community sector organisations to administer this tax. It is absolutely absurd.Let us go through the thought processes of the government. Essentially, this tax now stinks to high heaven, but they are absolutely desperate to apply it to every organisation in the community because they have got themselves into budgetary trouble. They have walked into this House today and admitted that they have stuffed up their tax rates. Therefore, they have to put on a special levy for very legitimate purposes, which we support. But why do they not come in here and admit that they have stuffed it up for the charities? Why do they not come in here and admit that? Why do they not do something for the charities?What is even more outrageous is the double standards. The government would rather give a tax break to the casinos than to the charities and the churches. It is happy to grant GST relief for the casinos, who pay the high rollers—it is happy to give a cash payment to their businesses. But, when it comes to the churches and the charities, there is no relief at all.Let us just go through what you have been up to. What does it really mean to the not-for-profit sector? Hall Chadwick chartered accountants have estimated the compliance costs of the GST alone on charitable organisations and community organisations will be between $500 million and $1 billion annually. Where have you been? They have been talking to this side of the House about the massive impact of this tax on their organisations, but where have you been? If you are completely unaware of this when you go to the ACROD conference and completely unaware of all the organisations that you defunded in this House a couple of months ago, what are you actually doing? Take this on board. Stand up for the organisations.This is what Libby Davies had to say in the recent edition of Impact from ACOSS about the complete impact of the GST on the community sector:Charitable organisations have in the past been exempt from taxation,—Are you aware of that? Is that a fact?but now, under the guise of policy of equitable treatment of all players on a level playing field, our organisations have been placed within a taxation framework that imposes huge costs for which the sector is not resourced or capable of recovering.Do you know what that means? That means they have a lot less money to provide services to the increasing number of people walking through their doors caused by other changes in government policy—caused by the biggest cuts to community services in Australian history. So, while demand for services is going up, funding is going down and now the huge compliance burden alone of the GST will mean funding will go down even more. Funding down; demand up—what do you get then? You get a crisis in the community sector. Libby Davies went on to say:GST Startup Assistance Funds fall far short of meeting the cost of compliance and will not replace the lost income now used to deliver specific services. Therefore organisations will be forced to sacrifice services in order to meet costs. Modelling from organisations across the range of community services has affirmed this fact.And here is the rub. She says:The playing field might now be level, but craters will appear where once services existed.Just another huge hole in the social safety net. That is what you are doing—taxing compassion and pushing another huge hole through the social safety net. That is the problem. I could go on at length and quote from every one of the major community organisations in this community. They have been making representations to members of parliament around this country for the last six months at least. The only people who appear to be completely ignorant of it, except the member for Kooyong opposite, are all the rest of the people on the government benches.The really sad thing about this is that the government can do something about it. It is not widely understood that the Prime Minister can grant protection from the GST to the churches and charities if he wants. He can do that. Section 35 of the intergovernmental agreement that establishes all of the arrangements to do with the GST states:During the first 12 months following the implementation of the GST, the Commonwealth Government will retain the discretion to make changes unilaterally to the GST base where such changes—are required. That is how the Prime Minister put the tax on the Olympic tickets and that is just how the Prime Minister can take the GST off the charities.That is the challenge for the government. Now that you are aware of the issue, now that you are aware of what difficult problems it is causing and now that you are aware of all the cutbacks to services that this will cause, why do you not do something about it? Why do you not take it off the Girl Guides, the Boy Scouts, the church lamington drive, the sheltered workshops, the St Vincent de Paul clothing stores and all of the other community organisations that do such a good job for our community? If the Prime Minister can slap it onto Olympic tickets, why does he not have the compassion to take it off the churches and the charities? Why does he not do that? He ought to do it because, as I said before—ET4BEVISMr Bevis—He took it off the high rollers.2V5Swan, Wayne, MPMr SWAN—Yes, he took it off the high rollers, too. As I said before, demand is increasing rapidly. That is documented in no end of reports from all the major charitable organisations in our community. The government is not going to do that because it is completely indifferent to this problem, because it actually wants to create an unfair tax system in this community. It wants to create an unfair tax system in this community and we know that unfairness is increasing because if you have a look at the family insecurity index graph that I am showing the House you can see the record of this government. It is increasing at a rapid rate. That means more children living in families where neither parent works, youth suicide going up, dreadful educational outcomes. All these social outcomes—LS4FERGUSONMr Martin Ferguson—That looks like the national insecurity index.2V5Swan, Wayne, MPMr SWAN—Exactly. All these social outcomes have been delivered by the biggest cuts to community services in Australian history and the fires of inequality are about to be fuelled by massive changes to the tax system which are going to make it even worse. The government's solution to that is they go round and say, `Oh, we are compassionate conservatives. We are going to have this social coalition. Don't look at what we do. Just listen to what we have got to say.' When you hear the words `compassionate conservative'—XS4LAWRENCEDr Lawrence—Oxymoron.2V5Swan, Wayne, MPMr SWAN—It is not only an oxymoron. We have said that before. Just think about when you go to the doctor. Think about what it is like if you are a little kid and you go along to the doctor when you have an earache. The doctor gets this big thing out and is about to stick it in your ear. You know it is really going to hurt and he says, `Oh, it ain't going to hurt a little bit.' That is what it is like when they use the term `compassionate conservative'. It is all going to be this smiley mask which is nothing more than a public relations exercise to cover up for the biggest cuts to community services in Australian history and the biggest change in the distribution of wealth in Australian history. Fifty per cent of the tax cuts go to the top 20 per cent of income earners and the rest—the 80 per cent—share the rest. That is what is going on and that is the problem. And because they have got a budget blow-out, now they want to go in and take away the GST compensation that is built into the system.We all know the Treasurer has finally come clean, admitting that the inflation rate is five per cent not 1.9 per cent. If you are on a benefit you can work out that if inflation is five and compensation is four, you are missing out. Because they have had to put the compensation into the welfare system, they now have a welfare blow-out. The welfare bill is going to blow out by about $5 billion next year. Do you know how they are going to fix that? They are going to take it off sole parents and DSP pensioners. They are the ones who are going to pay the price because you have stuffed up the tax system and you have engaged in this clandestine redistribution of wealth from the bottom to the top.The stench of it is such that the community cannot stand it. That is why we are going to keep up the pressure in this House continuously until you do the decent thing by the 10,000 or more community groups in this country who ask for nothing more from this government than a fair go. They do not want compassion taxed. They do not want the GST applied to their services. All they want is a little bit of government support. Given the way you are ripping and tearing away at the social fabric, surely you could be decent enough to take the GST off community services and off the churches and the charities so that we can fairly say that at least we believe in the ethic of community service, of care, of compassion and of a fair go. (Time expired)16:16:0012385Anthony, Larry, MPMr ANTHONYXJ6RichmondNPCommunity Services10—After what I initially thought were some sensible comments by the member for Lilley, he still regrettably went into his pathetic scaremongering. It is important to note in this House, particularly when he talks about compassionate conservatism, what type of compassion the Australian Labor Party left when they lost government in 1996 after over 13 years of stewardship. How much compassion can you have seen if you have been unemployed for a very long time and if official unemployment rates have been over 11 per cent?Is there much compassion involved when people cannot get a job? Is there much compassion when you are trying to make a living, when you do have employment, and your mortgage rates are excessive? Is there much compassion when there is rampant inflation in terms of the cost of living, the cost of bringing up children and the cost of looking after elderly people because the way the country is run is abominable? Is it compassion when you leave a country with substantial debt—when you are basically mortgaging this generation for future generations? Is that compassion? Of course it is not; it is hollow rhetoric. It was rhetoric used specifically for the purpose of retaining power.It is unfortunate that, even in this parliament when we would like to have a bit of an open and transparent discussion on how welfare is best suited to people who do need it into the next century, we still get this politicking from the member for Lilley. The interesting thing is that, even prior to the last election, they had a policy that said they would review a lot of this particular area.We did have a plan that we, quite unashamedly, put to the Australian people. The majority of the Australian people said, `Yes, we support a change in the tax system. We support a change that can give our children a better opportunity, that will enable us to retain a certain percentage if we earn more and that will provide adequate revenue to enable us to run a social security system well into the future rather than being indebted through asset sales.' These asset sales were spent in the year of recurrent expenditure, not to retire debt; they were just used for wilful expenditure.We went to the Australian people with a new tax system. Part of that was to ensure that we could give the greatest thing to people—an opportunity to maximise their potential, whether it is through employment, whether it is with a carer's allowance or whether it is providing cheaper accommodation for people. The monetary policy of lower inflation means lower mortgages. Those lower mortgages mean that there is around an extra $350 for people every month. We had to initially rein in that budget deficit to do that.This new tax system is going to provide incentive for people who are currently in the work force. Eighty per cent of the population will pay no more than 30 per cent tax. We will abolish the wholesale sales tax and a raft of other indirect taxes that have affected people on lower incomes the most. But that was conveniently forgotten by the Australian Labor Party, and particularly by the icon that the member for Lilley looks up to—Paul Keating.In 1993 they said, `We are going to have big tax cuts which obviously will help the most disadvantaged.' What happened to those tax cuts? They evaporated. There were no tax cuts. What happened instead? The wholesale sales tax—the tax by stealth—went from 10 to 12 per cent, from 20 to 22 per cent and from 30 to 32 per cent. In their 13 years of stewardship fuel excise went from 7c to 34c. For people using leaded vehicles, who are usually people who have had a car for over 10 years and who are generally struggling, they decided to whack the tax up even more. How much compassion is there in that? They had no compassion. They shed these crocodile tears when they had stewardship.It is a bit rich when they come into this parliament and claim to assume the mantle to look after those people who are most vulnerable. The phrase coined by the Prime Minister was `Howard's battlers'. We are looking after the vast majority of Australians, not just conveniently looking after the bigger end of town through R&D syndicates—although the recent conversion on the road to Damascus is welcome when it comes to the Ralph committee.Let us look at some of the things that we are doing for people who are less fortunate than members in this parliament. We are saying that, if you are on a pension, that will be increased by four per cent to compensate for any one-off increase we may see because of the introduction of the GST on 1 July next year. We are also saying we will put in a two per cent buffer in case we are wrong. We will ensure that people on social security payments are kept at least two per cent ahead of any inflation gain. Did you ever say that when inflation rates went over 12 per cent? Of course not.It is important to put on the record exactly what we have done to assist charitable organisations. We want to ensure that in the long term there is actually less demand on charities because people can better maximise their potential by having either full employment or a higher standard of living. As the Treasurer mentioned today, we have established a not-for-profit charities consultative committee. We are listening, which has been conveniently forgotten by the member for Lilley. The government and the ATO are still developing rulings well in advance of the GST.Yes, we have established an ATO team to assist the sector to implement this, and we are having ongoing consultations. I suggest that, as we have a seminar coming up in Brisbane on 17 December, the member for Lilley might like to go, rather than shed the pious crocodile tears that he has cried in this chamber. The charities consultative committee is due to have its next meeting tomorrow—it had its first meeting back on 5 August—and it is made up of representatives of many charitable organisations. As you well know, the GST registration charity charge is not applicable to those providing goods and services to people with disabilities, the aged or child-care services. This fee will not be subject to the GST.Similarly, when goods and other services are provided on a non-commercial basis as part of the agencies' charitable work, any fee will not be subject to a GST. We have stated that, if charities are involved in major commercial activities where they are competing against other private enterprises, yes, they will be subject to a GST. I do not think there is anything inequitable about that. But where charities pay a GST on goods and services, if they purchase from other registered businesses, they can claim it back like any other organisation. Likewise, if charitable organisations have a turnover of less than $100,000, they are not required to register for GST. Organisations earning less than this figure can choose whether to register or not.With the issue of government grants, as was mentioned in question time today, it is likely that grants made by the government to charities will be subject to a GST. The grants would be adjusted to incorporate this, and the charity would remit the GST component to the Australian Taxation Office. Therefore, charities will be no worse off. Indeed, for many of them, there will be lower costs because of the embedded nature of the GST. They conveniently forget about that fuel example I used. Many of the members who represent rural Australia know that the biggest component is transport costs. It does not matter whether you are in business or in a charity trying to help people. Of course, those embedded costs will come down considerably, along with the removal of wholesale sales tax and excise taxes. These are broad-ranging benefits that will benefit all organisations.Let us have a look at some of the exemptions, because I think it is important to help educate the opposition.84THAASEMr Haase—Impossible.XJ6Anthony, Larry, MPMr ANTHONY—You are probably right, but I think it is my duty to make an attempt. There are numerous GST exemptions that apply to charitable organisations. For instance, donations to charities will be GST free, as well as many fundraising activities like the sale of red noses and second-hand goods, raffles, bingo, et cetera. We are mounting a major education program—and why shouldn't we?—because we are having fundamental tax reform, which will make this tax system relevant for the next century. Labor never educated us. They never educated us when they conveniently whacked up all the wholesale sales taxes. They did not give us the promised tax cuts which were l-a-w law—I think they were spelt l-i-e—but we are spending $10 million to raise awareness through seminars. There will be over 1,000 seminars in 86 locations particularly geared towards charities.Likewise, we are providing assistance to small community groups of up towards $500 million for GST implementation and start-up. With the GST, the government has agreed to make a very wide list of aids and appliances exempt from GST. We are very cognisant of that. We do show compassion to those people who need continence aids or other aids that they may need if they have a particular disability. It would be remiss of me not to state that, yes, we are looking at ensuring that the rorting by some—not all, I acknowledge that—regarding FBTs is taken into consideration. Why should some organisations have a significant advantage over others? So we have put in a proposal for a $17,000 grossed-up taxable value cap for public benevolent institutions which is fair and equitable. It is up to those organisations to structure their packages accordingly.It is important to look at what the Prime Minister has mentioned and what the member for Lilley has alluded to, which is that we do believe in a social coalition. We are sending out a lightning rod, but the government does not have exclusive responsibility—although we do not shirk our responsibilities. We want to engage the business community, as well as local communities, to ensure that there is a wider social coalition to assist people that are in need. Part of that is $13 million in funding over four years to develop these strategies to encourage best practice partnerships and to raise awareness of the value of partnerships. This comes on top of the $51 million a year that the government is expected to forgo by implementing taxation changes which encourage corporate giving. Is anything wrong with that? Do we ever get a bouquet from the opposition? Of course not.Income tax deductions for the market value of donations of property worth more than $5,000 are a positive measure. Other measures include capital gains tax exemptions for testamentary gifts of property to bodies eligible to receive tax deductible donations. New categories of private charitable refunds provide business, families and individuals greater freedom to set up their own trusts for philanthropic purposes. Donations of property under the Cultural Gifts Program are exempt from capital gains tax and donors will be able to apportion their tax deductions for donations over a period of up to five years.Even Michael Raper of ACOSS has welcomed the Prime Minister's promise to give tax breaks to business for donations to charity—not like the R&D syndicates, not like the sneaky deals that they did with the big end of town in the last parliament which are on record. Even Michael Raper recognised that there are substantial incentives that this government has created to ensure that it is not just the government but a broader social coalition—whether it is business or communities—that will help people who are less fortunate than those in this parliament. We need to break down those barriers within the wider community to help those many organisations that look after many people who are disadvantaged.I want to look at the whole rationale for why the government is embarking on some of these tax reform changes, why we are making specific provisions to take into account the good work that charities do. If we did nothing, if we just left it like the Australian Labor Party did—put it on Bankcard, make no substantial changes, have no incentive in the taxation system for people to work—what would happen is what has happened. In 1965 the number of people of work force age receiving social security benefits was 200,000; today, it is 2.6 million. One in five people of work force age receive some type of social security payments. We do not step away from that. Likewise with DSP, to put it into perspective, we should look at the past to get an idea of the present and where we will go in the future. If you look at DSP 10 years ago, there were 300,000 people on invalid pensions. Today, it is 600,000. If we did nothing over the next couple of years, that figure would approach close to three-quarters of a million.These people have to be funded. These people are entitled to support and assistance. What do we do? Do we take the Labor Party notion: `Let's just forget about it, let's just pretend it's not happening; we'll just put this country further and further into debt'? That was exactly the situation in 1996 when we inherited a deficit of close to $10 billion. Tax reform is essential to make Australia more productive, to give greater incentive and to ensure that we have a social security and incomes policy system which is sustainable into the next century. We are all about being responsible Australians and ensuring that we can look after those people who need help and that we can look after charities. But the best help you can give anyone is to give them employment—to give them an opportunity to perhaps get off a lifetime of welfare dependency where they had no other alternative.We would be remiss in this parliament if we chose that path. That is why it is essential that these changes in the tax reform package are appropriate. We are continuing to have a dialogue with charities to ensure that there are provisions put in place to compensate them for any anomalies that might occur within the GST. (Time expired)16:31:0012389Gerick, Jane, MPMs GERICK83WCanningALP00—If you were a parent of a family that is struggling and that relies on charitable organisations for help, the question you will be dreading your kid asking next Christmas is, `What is Father Christmas bringing?' The answer is going to have to be, `Scrooge has been and we're going to have a lean year.' The GST will have a devastating impact on charitable institutions in Australia and it is an example of just how unfair the tax is going to be for Australians who are struggling and for those organisations trying to help those people. While highrolling gamblers will be protected, the charitable industries are going to feel the impact of a tax which is going to make it impossible for some of the smaller organisations to survive and make it difficult for the larger groups to provide the services which we all know so well.In the beginning, institutions will have to face the cost of compliance. I do not know that a voucher from the government, assuming they get one, is going to be much consolation to them. It has been estimated by Hall Chadwick, chartered accountants, that the compliance costs for charitable institutions and community organisations will be between $500 million and $1 billion annually. Having met the compliance costs, the charitable institutions will then have to deal with the ongoing costs of keeping the information needed to deal with all the paperwork. Research from New Zealand has shown estimates that the GST will add between five and eight per cent to the running costs of community organisations.Anglicare Australia estimate that it will cost their organisation $500,000 to establish the necessary administrative systems based on implementation costs of one to two per cent of turnover applied to the private sector. St Vincent de Paul told the government that they will have between $2 million and $4 million less to spend on services to those in need as a direct result of the GST. That adds up to reduced services from an organisation that has recorded an increase in demand of more than 30 per cent in recent times.Each time one of our charitable institutions takes a hit, they are going to have less money to spend providing the essential services that Australia needs to be a caring community. Australians have always had a great tradition of helping those in need. Without hesitation and fuss the hat was passed around to raise the funds needed. Today when that good tradition is continued by kind people organising events such as a cake stall, that hat has been tampered with. There is a hole in it and the government's hands are beneath it taxing kindness. This is an un-Australian tax. Each time groups work together to try to make our country a better and kinder place to live, barriers are being put in the way to make it all so much harder.There is little logic to the way the GST is going to be implemented. An example of this is the proposal to not exempt clothing which is cut up to be sold as cleaning rags. Each year 55 million kilos of donated items are received by charities; of these, about 11 million kilos are unsuitable for reselling. The charities have two choices: they can send it for landfill or they can cut it up and sell it for industrial rags. It makes no sense for the government to force wastage.For years people have volunteered their services to go and help charity organisations. However, giving time may no longer be enough. Rather than being a voluntary treasurer of the local branch, they will need to understand and take responsibility for the implementation of and compliance with the demands of the GST. This is an unfair demand on the average volunteer.A number of charitable organisations are already struggling under the weight of the cuts that have been made to social services by this government. The GST will be the death knell for more. The Spastic Centre of New South Wales reported that it will stop providing services to 370 school age children, close a children's respite centre which currently supports 40 families, reduce early intervention services by one-third and cease services to 200 isolated and disadvantaged families in rural communities. Wesley Central Mission reports cutbacks to Kids Under Kanvas, an integrated camping program for children. Do Care, a support program for isolated older people, and therapy services to school age children in Perth have also been closed.The impact of the GST will be cruel and unfair on charities. These are just a few examples of the hits which will be taken. Clothing bins operated by charitable organisations such as the Brotherhood of St Laurence, the Red Cross, St Vincent de Paul, the Smith Family and others will be hit by the GST, resulting in loss of revenue for charitable institutions in the order of $16 million annually. SIDS will lose an estimated $121,000 from their fundraising, because of the GST. The Church and Charitable Private Hospitals Association told the Senate inquiry on the impact of the GST on charities:Unfortunately, Treasury seems to understand the profit motive and privatisation, but does not seem to understand mutuality, altruism or charity.It does not seem to understand that they are non-government institutions that exist to raise resources in order to meet the needs of the poor or the sick. To suggest that such organisations should be taxed in the same way as profit making trading corporations is illogical. Charitable institutions do not make profits to distribute to shareholders. They do not have boards which aim to take home huge bonuses. They work with lots of volunteers to raise money to increase the number of services they can offer to those in need. They should be supported and encouraged, not continually put under increasing pressure to meet the needs they face each day.It is the responsibility of each citizen who has the means to help those who are in need. It is the duty of the government of the day to put in place the services which are needed to provide each person's basic needs. This government is failing in that duty. The implications of the GST are frightening for any charity committee planning an event. Think about this submission from the Adelaide Central Mission:The organising committee meets with the treasurer to look at the new tax implications for each stall:A stall selling hot dogs and drinks.GST has to be tracked on all purchases and sales so it can be charged as necessary and claimed as an input tax credit where possible.A skittles game stall.GST has to be charged on the sales to everyone who has a go on the skittles.A lucky dip.GST has to be tracked on all the purchases. GST has to be charged on all new donated items.A trading table selling new and second-hand items, all of which are donated.GST must be tracked and charged on the sale of new donated items.A barbecue (with food donated by local businesses).GST must be charged on the ticket price.A square dance.GST must be charged on the ticket price.Will the additional costs of training, administration, balancing the GST books, managing GST queries and ensuring an auditable set of records for tax purposes stop the fete from being worthwhile this year? Some volunteers are angry—the goods they made or bought and donated for sale in order to help the charity have been taxed. Some volunteers are nervous. Even though they will be trained in the application of the GST, they aren't confident that they will remember to add the GST onto all the new donated items. Mrs Mavis Sutherland is 72 and has been helping out for years. `This is all too hard!' she says and resigns from the committee. The others agree, `This is all too hard, we're just volunteers—not accountants and tax collectors!' This year's fete is cancelled.Scrooge is back, and he needs to be stopped before the charitable organisations falter under the weight of the unfair tax, the GST.16:40:0012391Georgiou, Petro, MPMr GEORGIOUHM5KooyongLP10—The member for Lilley made some very important points. I thought he said that egalitarianism was important and a fair go was important, and that did resonate. I noticed that he did not use the term `social justice'. He did actually ping my memory, and I asked for a speech that I delivered on 19 September 1995 on the issues of fair go and equality.2V5SWANMr Swan—Tell us about your speech last week.HM5Georgiou, Petro, MPMr GEORGIOU—It was embedded in that speech.2V5SWANMr Swan—Can we have that one as well?HM5Georgiou, Petro, MPMr GEORGIOU—I will read that first and then I will come back. It read:The Hawke-Keating Government, while strong on the rhetoric of equality, oversaw major damage to the social fabric of our society.The speech continued:The brutal reality is that under Labor the gap between the highest and lowest earning employees is larger than it was under Malcolm Fraser. Under the `Squire of Nareen', the least well paid workers earned more in real terms than they earned under the boy from Bankstown.I also referred in that speech to a study by Boyd Hunter and Bob Gregory. That is worth while quoting because I think it is important that we keep a historical perspective on this matter. It was a study published in 1995 which gives some depth to one-dimensional statistics. This is what I said in 1995 about what the study showed, how our society has changed for the worse:It shows a society in which income distribution is more unequal, and the change is extraordinary; a society in which there is a significant increase in the geographical polarisation of household income; a society in which the poor are increasingly living together in one set of neighbourhoods and the rich in another set; a society in which the economic gap is widening.So when the member for Lilley jogs my memory I actually do remember things.One thing about the ALP is that it is absolutely indefatigable in its attack on the GST. As we all know, the government went to the 1998 election explicitly on the basis of a new tax system. It won a mandate to implement that new tax system, and ever since then Labor has tried to impede the introduction and implementation of the GST, and it has tried to run as many hares into this debate as is possible. It did so with such effectiveness that it eventually ruled itself out of the negotiations on the introduction and implementation of the GST and left that role to the Democrats. Ever since then, Labor has been trying to niggle away at every conceivable aspect of the GST. Its attacks have ranged across things like the impact on low income earners, which was proved not to be valid. The last time I remember a debate on this by the Leader of the Opposition, he did not refer to the subject matter of the MPI at all. Now we have the member for Lilley trying to attack the GST for its alleged adverse impact on charities and on the disadvantaged.I think that the member for Lilley actually did say some very important things about the significance of charitable institutions which would be shared on both sides of the House. Charitable institutions are a fundamentally important contributor to the Australian welfare system. But, despite the crocodile tears of the member for Lilley, the fact is that the fundamental brunt of the opposition's attack was on the GST. They dealt themselves out of the debate. They chose to ignore the compensation which was made available to low income earners and the disadvantaged. They chose to ignore the fact that in their activities charitable institutions would be able to claim back the embedded taxes across all their activities, claims that they would not previously have been able to make. They chose to ignore the special treatment of charitable organisations in not having to register turnover if it is under $100,000. In sum, the Labor Party on this particular issue is once again running a general animus against the GST into every conceivable burrow that it can run it down.The term `charitable' has the same meaning for GST as it has for income tax. Purposes are considered charitable if they benefit the community or some section of it through the relief of poverty or sickness or the needs of the aged, the advancement of education or religion or other purposes beneficial to the community. Relieving poverty, sickness and the needs arising from old age are indeed charitable. The significant fact that is skated over by the ALP in its denunciation of the impact of GST on charitable institutions is that only the commercial activities of charities will be taxable. Non-commercial activities will be GST free. This is a very important distinction and it does mean that a number of the operating costs of charitable organisations will fall.Let us look at one component where a charity is funded under a business model, whereby a government funds extra support staff to assist the people with difficulties that the organisation is responsible for. If the service produces commercial supplies, then those will be subject to GST, but at the same time the service will be able to claim input tax credits on its acquisitions required to make the supply. In the case of charitable organisations combining commercial and non-commercial activities, the products produced will attract a GST, but the employment assistance component will not do so.Charitable organisations engaged in the production of books for which there is not a traditional commercial market—and braille books are a good illustration of this—are treated sympathetically. Braille books become a medical aid and therefore GST free. The majority of the activities by charitable organisations will in fact be GST free. If a charity decides to hold a raffle or a bingo competition, that will not attract a GST. All donations to charities will remain GST free. All business running costs which attract GST will be claimable as tax input credits. A charity will be able to claim an input credit because it is a legitimate business with running costs. So donated second-hand goods will be GST free when they are supplied by charitable institutions or when they retain their original character.A lot was made of the imposition and lack of consultation, but nothing could be further from the truth in terms of the application of the GST and the generation of the appropriate rules. It is a matter of record that the Taxation Office has worked in close consultation with the charitable sector on this issue and it was announced by the Prime Minister in May this year that a consultative committee representing the charity not-for-profit sector would be established to work with the tax office and advise on issues as they arose.The committee met for the first time in August. Amongst its members are Father Brian Lucas of the Catholic Archdiocese of Sydney, Mr Paul Bird of the Brotherhood of St Laurence, Lieutenant Colonel John Hodge of the Salvation Army, Mr Patrick McClure of Mission Australia, Mr Peter Davidson of ACOSS and Miss Marion Reilly of the Community Housing Federation of Australia. That is a very representative and a very persuasive group, and it has been involved in clarifying issues, advising the tax office and passing on to their respective members detailed information on compliance and preparation.Let us take an example. The committee recommended that the government increase the 50 per cent market value and cost of supply tests for the non-commercial supplies of charities to 75 per cent for supplies of supported accommodation/community housing. The committee claimed that 50 per cent was too low to give effect to the government's policies and the government listened and accepted the committee's recommendations and made the changes in legislation. The government has introduced a number of measures to assist charitable organisations which have already been run through. I think that the basis of this attack is really not concern about the charitable sector. It is part of a wholesale attack on the GST. Its basic animus is one of frustration because the opposition were excluded from the eventual form of the GST and bypassed by the Democrats. I think the Labor Party would be much better off focusing on new and emerging gains rather than trying to refight the past.10000DEPUTY SPEAKERMr DEPUTY SPEAKER (Mr Jenkins)—Order! The discussion has concluded.Miscellaneous1239316:49:0012393Fischer, Tim, MPMr TIM FISCHERDG4FarrerNP10—Mr Deputy Speaker, I seek the chair's indulgence to exercise an opportunity to ask you a question which you might refer to the Speaker.10000DEPUTY SPEAKERMr DEPUTY SPEAKER (Mr Jenkins)—Indulgence is granted. Please continue.DG4Fischer, Tim, MPMr TIM FISCHER—This afternoon saw a very important statement by the Prime Minister followed by a response by the Leader of the Opposition. It was of national importance, but I noted that it was not during a broadcast period of the parliament because it is Tuesday and it is not our turn—although, presumably, it was going out on the Internet under the new arrangements announced by the Speaker. I am wondering whether in these special circumstances you might refer this to the Speaker so that he might approach the Senate to allow this one-off type of occasion to be in fact broadcast by the more traditional method as well as by the new Internet process, especially given the importance of the Timor issue, all things considered.12393Mr DEPUTY SPEAKERMr DEPUTY SPEAKER10000PON/A10—I thank the honourable member for Farrer for drawing the circumstance to the chair's attention and I will undertake to bring it to the Speaker's attention. I am sure that he will get back to the honourable member for Farrer in due course.Miscellaneous1239310000DEPUTY SPEAKERMr DEPUTY SPEAKER (Mr Jenkins)—I advise the House that the Deputy Speaker has fixed Wednesday, 24 November 1999 at 9.40 a.m. as the time for the next meeting of the Main Committee, unless an alternative day or hour is fixed.Miscellaneous12393Motion (by Mr Ronaldson)—by leave—agreed to:That the following bills be referred to the Main Committee for consideration:National Residue Survey Levies Regulations (Validation and Commencement of Amendments) Bill 1999 ;Tradex Scheme Bill 1999 [No. 2] ; Tradex Duty Imposition (Customs) Bill 1999 ;Tradex Duty Imposition (Excise) Bill 1999 ;Tradex Duty Imposition (General) Bill 1999 , andCustoms Tariff Amendment (Tradex) Bill 1999 .Committees12393123931239312393Mr DEPUTY SPEAKERMr DEPUTY SPEAKER (Mr Nehl)10000PON/A10—I present the report of the Selection Committee relating to the consideration of committee and delegation reports and private members' business on Monday 6 December 1999. The report will be printed in today's Hansard , and the items accorded priority for debate will be published in the Notice Paper for the next sitting.The report read as follows—COMMITTEE AND DELEGATION REPORTSPresentation and statements1 AUSTRALIAN PARLIAMENTARY DELEGATION TO GREECE, TURKEY AND CYPRUS: Report on the Australian Parliamentary Delegation to Greece, Turkey and Cyprus—July 1999The Committee determined that statements on the report may be made—all statements to be made within a total time of 20 minutes.Speech time limits—First Member speaking—10 minutes.Other Members—5 minutes each.2. FOREIGN AFFAIRS, DEFENCE AND TRADE—Joint Standing Committee : Report on the proceedings of a Seminar on World Debt, 27 August 1999.The Committee determined that statements on the report may be made—all statements to be made within a total time of 5 minutes.Speech time limits—Each Member—5 minutes.3. LEGAL AND CONSTITUTIONAL AFFAIRS—Standing Committee: Advisory report on the Copyright Amendment (Digital Agenda) BillThe Committee determined that statements on the report may be made—all statements to be made within a total time of 20 minutes.Speech time limits—Each Member—5 minutes.4. NATIONAL CRIME AUTHORITY—Joint Committee: Report on the involvement of the National Crime Authority in controlled operations.The Committee determined that statements on the report may be made—all statements to be made within a total time of 10 minutes.Speech time limits—Each Member—5 minutes.5. TREATIES—Joint Standing Committee: Report 27: Termination of Social Security Agreement with the United Kingdom and International Plant Protection Convention, andReport 28: Fifteen Treaties tabled on 12 October 1999.The Committee determined that statements on the report may be made—all statements to be made within the time remaining prior to 1.45 p.m.Speech time limits—Each Member—5 minutes.PRIVATE MEMBERS' BUSINESSOrder of precedenceNotices1 Mr Baird to move:That the House:(1) commends the Government for its efforts in promoting domestic and international tourism which has resulted in a 10% increase in international visitors during the last 12 month;(2) notes the significance to the economy of the number of jobs created by tourism; and(3) notes the foreign exchange earnings resulting from international visitor travel to Australia. (Notice given 12 October 1999). Time allotted—30 minutes.Speech time limits—Mover of motion—10 minutes.First Opposition Member speaking—10 minutes.Other Members—5 minutes each.The Committee determined that consideration of this matter should continue on a future day.2 Ms Hall to move:That this House notes:(1) the failure of the Howard Government to address the needs of people living in regional Australia;(2) the lack of knowledge demonstrated by the Government of issues that impact on the daily lives of regional Australians;(3) the failure of the Government to provide jobs, services and adequate health resources to regional Australia; and (4) the betrayal of regional Australia by the Government's inability to differentiate between regional and rural Australia. (Notice given 18 October 1999). Time allotted—remaining private Members' business time.Speech time limits—Mover of motion—10 minutes.First Government Member speaking—10 minutes.Other Members—5 minutes each.The Committee determined that consideration of this matter should continue on a future day.Bills12394s20612394Debate resumed from 22 November, on motion by Mrs Bronwyn Bishop:That the bill be now read a second time.16:53:0012394Billson, Bruce, MPMr BILLSON1K6DunkleyLP10—The Australia New Zealand Food Authority Amendment Bill 1999 [No. 2] amends the operations of the authority to improve the efficiency, transparency and accountability of the authority whilst ensuring that the food regulatory system better protects public health and safety and protects consumers from misleading or deceptive behaviour in the sale, advertising and labelling of food. It does this by including in the act objectives and an expanded range of functions to reflect the authority's current role. It also gives the authority power to make decisions on minor amendments to the Food Standards Code where clear policy direction has already been given by the Australia New Zealand Food Standards Council, with the Australia New Zealand Food Standards Council having the capacity to overrule these decisions.It also achieves these objectives by applying the authority's assessment and consultation processes to the development of both food standards and codes of practice and to make the primary objective of those food regulatory measures the protection of public health and safety and the prevention of misleading and deceptive conduct in relation to the sale, advertising and labelling of food.The amendments will also clarify the things which the authority is required to consider when developing new regulatory measures, including the impacts of those food regulatory measures. It amends the definition of food to be consistent with the definitions in state and territory food acts, and it also introduces a work program arrangement for the authority to enable the authority to delay processing applications which are outside its work program and to recover costs for processing applications where it is able to capture the industry benefit.In developing and varying the food regulatory measures, the authority will now be required to take account of public health and safety and the prevention of misleading and deceptive conduct. This expanded role will complement current ACCC and trade practices legislation by giving the authority an up-front proactive ability to protect the consumer. When developing food standards, the authority must provide adequate information to consumers and promote consistency between domestic and international food standards where appropriate. This amendment will ensure that our food standards and regulatory practices remain true to our WTO obligations but protect Australian consumers from the lowest common denominator approach to world food standards.The proposed objectives for food regulatory measures will help to ensure that the consumer issues are highlighted in the development of standards and that secondary objectives such as promoting trade and commerce are also addressed but are distinctly separate from the important public health and safety issues. ANZFA is currently involved in two major law reform tasks. These are the development of uniform food safety standards and related initiatives for our country and the development of a joint Australia-New Zealand food standards code.I want to take the opportunity to raise some issues about ANZFA's role in developing food standards and in particular the role it plays in regulating genetically modified foods. ANZFA has developed guidelines for assessing the safety of genetically modified foods. These guidelines are based on protocols and principles developed by the World Health Organisation and the Food and Agriculture Organisation. Individual applications are examined by ANZFA. Initially a preliminary data assessment is carried out and public submissions are taken. If the first stage comes up okay, the application is subjected to a full safety assessment. A genetically modified food is considered safe if all the characteristics—chemical, physical, nutritional and use—are the same as for the conventional counterpart. Following the safety assessment, a second period of public consultation is carried out, followed by a final recommendation for approval to health ministers, sitting as the Australia New Zealand Food Safety Council.ANZFA is currently assessing about 19 applications that cover the genetically modified food ingredients imported or used in foods in Australia and New Zealand. In addition to the safety assessments, the Australia New Zealand Food Safety Council agreed on 3 August to mandatory labelling of all genetically modified foods. ANZFA has been developing strategies on how to action the council's recommendations to amend the Food Standards Code.Importantly, the Australia New Zealand Food Standards Council made the point that it was introducing labelling not because of any concerns about the safety of genetically modified foods but because of the clear desire of the public to have as much information as possible about the food they buy. ANZFA has said in the past that mandatory labelling is not necessarily the best way to give consumers information. The bill seeks to give the authority greater freedom to develop education campaigns, pamphlets, point-of-sale material, web sites, fact sheets and any other effective alternative for getting information across to consumers in the right circumstances at the right time.I wholeheartedly support the labelling of genetically modified foods as a way of providing more consumer information. I think it fits well with the responsibility of ANZFA to prevent any misleading or deceptive conduct in relation to the sale, advertising and labelling of food. This is an example of where the government, food processors and consumer groups need to work together to reach the ultimate goal—a safe food supply which people have access to information about.There is, however, an even greater issue that genetically modified food and other organisms raise, and that is the question of ownership of naturally occurring organisms, genetically modified organisms and the processes. In particular, I would like to touch on the issue of ownership of naturally occurring organisms because I believe it is an issue that goes to the heart of the genetic debate, and it is one that could have profound long-term effects of public access to food and other products. I quote:To what extent should individuals and private corporations be permitted to use patents to claim exclusive "ownership" of information contained in genomes of genetically engineered organisms?This was a question posed to the world by Canadian academic and author David Suzuki on page 347 of his 1989 book entitled Genethics . It is a question that has great relevance for the debate about genetic modification in Australia a decade later. The debate surrounding the regulation of biotechnology and Australia has revolved around the central themes of public and environmental safety and concerns about the escape of rogue genes into the general environment, for example, super weeds, and the relative safety of genetically modified food.The federal government has recently established the interim Office of the Gene Technology Regulator, which will begin the process of bringing together the work done by a number of agencies, including ANZFA. This move is recognition of the enormous potential of biotechnology not only for the Australian community, through food production and medicine, but also for the Australian economy in the form of developing industries and the value of intellectual property this technology represents. In order for Australia to reap the benefits of our mega diverse ecology and intellectual efforts, and indeed the spoils of biotechnology as a whole, it is important that we do not find ourselves blocked from accessing biotechnology processes and natural organisms. The intellectual property debate has been hotting up around the world, but it is particularly complex in the area of biotechnology. On their web site, Intellectual Property Australia describes seven different types of intellectual properties: patents for innovations, that is, new or improved products or processes; trademarks, for words, symbols, pictures, sounds and smells or combinations of them; designs, for the shape or appearance of manufactured goods; plant breeders' rights, for new plant varieties; circuit layout rights for three dimensional configuration of electronic circuits; trade secrets, including know-how and other confidential information; and copyrights, for original material in literature and artistic, dramatic or musical works, and film broadcasts, multimedia and computer programs.Most countries have similar intellectual property rights systems to our own. That is the strength of the system. The way patents in particular are applied has differed between countries, especially when it comes to biotechnology. The world's first patent was issued in Venice in 1474. In 1922 Germany accepted a process patent on a bacterium and the door was opened to patent protection for plant varieties. In 1987 the US patent office first expressed a willingness to consider patents on animals. In 1992 a species patent was granted in the USA on genetically modified cotton. In 1993 the US government applied for patent rights over human cell lines of citizens of Panama, Papua New Guinea and the Solomon Islands.Intellectual property rights have long been recognised as being, in part, a human right in the sense that we have a right to own our own ideas, and in the form of a contract with the public in the sense that the originator gives the community access to their invention or idea in return for consideration derived from that idea or invention over a period of time.To get a patent of any kind, a person or company needs to come up with something new. Patents are issued for inventions, not discoveries. This distinction is important to keep in mind when we see genes being patented. The sequence of a pre-existing gene is a discovery. It is a discovery of something that already exists. It may, however, enable new things to be produced or to be discovered via a new technique, and those things can be patented, not the discovery itself. This simple explanation makes the process seem easy enough but, as with most things that involve people and money, the practice is not as clear-cut as the theory. We are talking about a lot of people and some big bucks.By the year 2000, the US biotechnology industry is projected to have sales of $50 billion per annum. The living results of this investment are easily reproduced by others, so patent protection is a high priority for those carrying the investment risk. The US patent office seems to be more open to issuing patents on living, naturally occurring organisms than many other countries. According to the UN Chronicle, Volume XXXVI, No. 1, 1999:Under United States legal doctrine the `modification' or artificial reproduction of genetic or cell material can be interpreted as `creation' or `invention', allowing patenting of slightly altered biological material, including cell lines `shuffled' from human genes.I mentioned in a speech in this House earlier this year the example of the oncomouse, a mouse with a human gene that predisposes the mouse to cancer, developed by Harvard University. Harvard received a patent both for the process of inserting the gene and for the mouse in the United States. In Canada, while the process was patented, a judge ruled that Harvard could not patent a mouse because, as he said, `Harvard did not invent the mouse.' The mammal is not a laboratory creation or invention. While some academics and companies support the idea of patenting naturally occurring living organisms, using the argument that it is good for research, other groups claim that patenting these organisms will only help to line the pockets of big biotechnology companies and lock everyone else out of the biotechnology industry.Some members will have heard of the Human Genome Project, an ambitious project to develop a map of the human genetic make-up. This project is a publicly funded initiative that would see the resulting human genetic map become public property. The international consortium of scientists that started this work a decade ago now has a competitor, a US company called Celera Genomics. Celera Genomics announced in 1998 that it was working to create a human gene map and that it expects to be able to do so by the year 2000 rather than by 2005, which is the target set by the publicly funded Human Genome Project. While the company has promised to provide access to its genetic map, it has already done deals with several large pharmaceutical and agricultural companies. In exchange for fees of several million dollars a year, companies get access to Celera's database. The company's literature itself states that Celera's goal is:To become the definitive source of genomic and related medical and agricultural information . . . Celera will develop and compile biological and medical data to establish the most complete life science resource available, ultimately creating the information portal for the life science and medical community.My concern about the work of Celera Genomics and other biotechnology companies is that they are in effect taking ownership of existing living organisms. On another level, living organisms and processes have been used for decades by indigenous people. They are now being patented by companies that have been able to isolate the beneficial genes in the organisms that generations of others have known about, even if they have not had the scientific knowledge to identify the particular active gene. This has been referred to as biopiracy, which violates indigenous people's human rights, religious and cultural beliefs and the right to self-determination.In a recent current issues brief—No. 16, 1998-99—the Parliamentary Library estimated the Australian biotechnology sector at about 170 companies, mainly private and mostly small, that is, with fewer than 25 employees. Because of a shortage of venture capital, most of these companies are only earning licensing fees from large multinationals.In an article in the April 14 Australian Financial Review, AWB Ltd Chairman, Trevor Flugge, is quoted as saying:Every man and his dog is getting into Biotechnology.. . . There will need to be some rationalisation of such firms in Australia to provide the critical mass to negotiate with multinational life science groups such as Monsanto Inc., AgRevo and Du Pont, which own much of the critical intellectual property in gene technology.If we don't do that in the longer term—five, 10, 15 years—we will be at the mercy of the multinationals as to what technology is available and, secondly, as to what you pay for it.Mr Flugge asks the important question: how are we going to get a piece of the action? Of course this question presupposes that we as a nation agree that `the action' is there to get. It may be that we are powerless to stop the privatisation of public genetic material, including our own, in which case the best course of action may be to get in on the action. Alternatively, it might be time for us to stand up and make the argument that naturally occurring genetic material cannot and should not be owned. Either way, we need to have in place decision making mechanisms to begin to address these questions and position our nation strategically.The food regulatory system is one piece of the puzzle. Steps that the government has taken to introduce a regulatory framework for gene technology and changes to the tax system to encourage venture capital are another part. The food regulatory system in Australia is complex and fragmented, comprising a large number of agencies and legislation spread across three spheres of government.ANZFA is currently involved in two major law reform tasks. These are the development of uniform food safety standards and related initiatives for Australia, and the development of a joint Australia-New Zealand food standards code. These reforms, along with the changes to the ANZFA Act 1991 outlined in this bill, will help ensure that Australia's complex food regulatory system becomes more efficient to the benefit of food consumers and producers alike.The food regulatory system is particularly important to the genetic modification debate because it is a major point of contact between the science and the consumer. There is ample evidence to suggest that, despite all the benefits genetic modification can have, the science and law have got ahead of community opinion and sound public policy. At the launch of the government's biotechnology discussion paper in September, broadcaster Don Burke said:Genetics is a very badly taught subject and hence the great confusion surrounding it creates fear in the general public.Mr Burke went on to say that the science is good but people need time to digest the complex subject and come to terms with it. The discovery, application and ownership of naturally occurring organisms and modified derivatives is a compelling environmental, economic, scientific, social and legal issue facing all nations. We need to make sure that our national interests are not overrun by more nimble participants in the field. ANZFA's obligation first and foremost is to protect public safety. It also has a role to play in ensuring that Australia is not left behind in the biotechnology race. However, the authority can play a greater role to make sure that we are taking our place in the biotechnology world and delivering the benefits it presents to our country and to our community.17:11:0012398Adams, Dick, MPMr ADAMSBV5LyonsALP00—I have a number of concerns about the philosophy behind these measures, especially in light of some of the current public debates. I must point to the salmon growers and to genetically modified organisms, as the member for Dunkley has just talked about. I will raise some very important issues in that debate. It is not a simple debate; it is a very complex debate that members of this House will have to come to grips with. It also relates to the current dilemma in the dairy industry.A regulator is important, but it needs to have some teeth and some direct impact on the better development of the industries it covers. Issues such as meat pies, radiation and mishandling of the GM food labelling issues are examples that our public confidence, in the regulator in particular, is slipping. Yet the Australia New Zealand Food Authority Amendment Bill 1999 [No. 2] does nothing to reverse that.The thrust of our amendments shows that Labour supports an accountable regulator that puts consumer and public health interests first at all times and that we should take into account the health of our industries. This bill contains a range of significant amendments to the legislation for regulation of food by the Australia and New Zealand Food Authority. It is a particular response to the Blair report issued in 1998 which recommended a move towards greater self-regulation in the food industry. The authority came into being in about 1991 and New Zealand joined with a treaty action in around 1996. The debate is now happening at a time of considerable public interest in food issues. The genetically modified food debate and strict standards for food hygiene are two parallel debates that are important because they also go to the heart of whether the Australia and New Zealand Food Authority has credibility with consumers. The whole thrust of the present debate is: does the regulator have the confidence of the consumer?I know that in the past the food regulatory system in Australia was complex and fragmented, comprising a large number of agencies and legislation spread across three spheres of government, making it very complex and difficult to deal with and to upgrade. If we are going to move forward in some areas of food production in this country, such as horticulture—which is growing greatly in many states and in may ways, increasing the amount of food we are producing for the world—we need to have a system which can operate much more efficiently than it has in the past.A number of reviews which are either currently under way or recently completed have identified specific problems with the existing system and have made recommendations to address the problems. In addition, the authority is currently involved in two major law reform tasks. These are the development of uniform food safety standards and related initiatives for Australia and the development of a joint Australia-New Zealand food standards code, which has been on the agenda for some considerable time. I have a number of problems with this. It is all very well to have a single agency for the development of a national food standard within your own agency, but it does concern me that we may adversely affect our own producers by lowering the standard bar. I do not think bringing down the bar to satisfy someone else is in our best interests or in the best interests of producers in Australia. I am sure the honourable member for Blair agrees with me. He has eaten Tasmanian salmon, and he knows the standard that we set in Tasmania and he knows the standard we would like to maintain. We would certainly like to see him down there fishing some time.If we allow our competitors—and in that I include New Zealand—to impinge on our public health and safety and consumer protection by lowering standards as well as updating the objectives for developing food regulatory measures to suit outside interests, I believe we would do our own producers a disfavour. While I have a lot of time for our neighbouring countries, I also understand that they do not give any ground when competing with us for the best markets and the best dollar out there in world trade. Standards that can be broken down to the lowest common denominator can mean death to our niche markets, especially to the smaller regional areas that really go for those niche markets to survive. That is especially so if we are pushing for a clean, green and organically unchanged product. It can mean our marketing edge over many other countries.I believe there should be some distinction made between commercial goals and health goals—not just public health but also the health of the product. I believe the salmon industry is teetering on the brink of disaster if hitherto unknown fish diseases are introduced into our country. We have discussed quarantine ad nauseam and we have had reports on threats of disease introduction. I must say that the New Zealanders did not help their cause by seemingly being at the bottom of that weird introduction of fire blight that mysteriously appeared in Victoria and South Australia a few years ago. That set one of Tasmania's apple markets back 18 months and over $1 million because of the possible implications with the Japanese market. The Japanese just went bingo, and it was another season before that market that people had worked on for about eight years, I think, was to come into being.Although we are a trusting nation and say, `Those people are like us and would not do such a thing,' in world trade it is a dog eat dog situation and we are at the mercy of dirty tricks now and again. If things are not going the way of a country with which we have a trading relationship then the dirty tricks can happen. There is competition out there and one country is against the other. We have to be careful. We have to protect our industries, especially those that are building up to compete at the top level of their range in the world. We should not put them at risk in any way.While the objective is to amend the operations of the authority in order to improve the efficiency, transparency and accountability of the authority, will it ensure that the food regulatory system better protects public health and safety and consumers from misleading or deceptive behaviour in the sale, advertising and labelling of food? That is the question that this House should ask. I do have some doubts about this bill. The drafting of the proposal needs to be much tighter to ensure that contentious issues and issues that are of public concern are able to be considered by the council and also be considered in the light of the needs of Australian growers and manufacturers as well as the needs and concerns of the consumers.I hope the government at least takes note of the concerns of the country in this case. I believe that the debate needs to be taken wider in looking at what we are actually doing by having uniform standards to penetrate outside our boundaries. What will this actually do to our producers and consumers? I know that people will argue that this will allow us to go out further, but there are also some very large dangers in it. With regulations and food plans being made so costly, there is also the difficulty of large versus small. Several industries have written to me and maybe to other members of this House about the actual costs of implementing those food plans and regulations. That can easily be written into policy for large food retail outlets and others but it is much more costly for the smaller manufacturer or the smaller retailer of food products. One does not want to lose the opportunity of those very small micro businesses that produce some unique foods. We need to make sure that, by trying to get these regulations or improve these standards right across the board, we do not knock out innovation and opportunity.For the first time, this year in Tasmania truffles were harvested from the Derwent Valley in my electorate. I think truffles are worth $3,000 per kilo. To get them across the Bass Strait will not be of great concern to us. The people of Sydney seem to be quite keen to pay good prices for this product. These products are found by a dog. In traditional France, I guess, similar harvesting techniques are used. How would food regulators deal with this? What costings are they going to impose on this fledgling industry? I am greatly concerned about tying up all the food regulations right across local government. We all know that food inspectors visit restaurants and hotels. We have probably had representations from people who thought they had been wrongly done by. We have state health authorities. We used to have two sections of meat inspection in Australia: the export and the retail on the local side. There was a lot of duplication and, most probably, a lot of cost involved. If we can put these regulations together, there can be savings. But we certainly do not want to stop the small hands-on operators from being able to produce something unique to give flavour. They produce something that has some uniqueness about it and makes people want to eat it. With regulations and overregulation, you can get to the stage where you mass produce everything in a state-of-the-art fashion but you destroy the actual flavours.I understand that the government has picked up some of the amendments from our side. I have some concerns because food safety and the health of our industries, the nurturing of very small food industries in Australia, are very important, especially in regional areas. It is one opportunity that they have of growing and of helping the people to remain and generate some wealth. We will support the bill, but we have some concerns. We will be very interested in following them along the way. 17:25:0012401Thompson, Cameron, MPMr CAMERON THOMPSON84CBlairLP10—In his contribution yesterday, the opposition spokesman on this legislation talked about sausage sizzles becoming a health threat. At the same time, he talked about the Labor Party's perceived need to maintain rigid rules rather than accepting codes of practice. I would say that he wants to have his sausage and eat it too on that issue. ANZFA has a difficult job to do. There is an old truism in politics about the hip pocket nerve. This legislation is proof that, although people care an awful lot about what goes into their hip pocket, they care even more about what goes into their mouths. It is an area where political scare campaigns can have a dramatic impact.I certainly appreciated the considered contribution from the member for Lyons, but other members had a different way of presenting their activities. I refer in particular to the member for Oxley in this place and in the local media, because he shares a few local newspapers with me. The member for Oxley has spoken about getting 7,000 signatures on a petition, insisting on the greater regulation of food standards and content. It would be a bit like getting 7,000 signatures to endorse motherhood except that to say so would be a bit of a jibe against motherhood, I suspect.I listened very closely to what the member for Oxley had to say earlier in this debate. When he was gathering his signatures, he was very vocal in the local media around Ipswich with these sorts of scare stories to which I refer about the alleged failure of ANZFA to provide a better, safer environment for food. You would think, to hear his comments, that ANZFA was some kind of terrorist organisation dedicated to imperil consumers rather than a statutory organisation charged with their protection. Mimicking the opposition spokesman, he talked about this legislation and its impact on consumer confidence. The opposition spokesman is the same fellow who began his speech by claiming that this legislation would make sausage sizzles a threat to community health. I ask: who is attacking consumer confidence here?At present, we have the most absurd campaigns running. All kinds of lobby groups, most with vested interests, or trying to make a name for themselves, are raising the spectre of hidden threats to food. We have the anti-genetically modified food lobby, the anti-chemical lobby and animal liberationists, who want to see every chicken run free. We have the label cranks, who want to map the family tree of every ingredient, and then we have the Ian McNamara lobby, who want to transport us all back to the 1950s. This is not helped by the parlous state of rural industry. People struggling to keep making a living on the land hear all this talk about food processors making pies with no meat or peanut paste with no peanuts. They naturally worry about the trend and the impact it will have on their incomes. Over all this, we have the opposition and the opportunity that they may see to take a rather cavalier attitude to launching a scare campaign on any one of those issues.Naturally, there are community concerns about food standards. However, the opposition and its members, like the member for Oxley, for example, are really doing no more than cashing in on these community concerns. I really should not target the member for Oxley in making these criticisms; he is just following the formula laid out by the opposition and others, such as the Australian Democrats. The member for Oxley just happens to share my local newspaper, so his activities are a little more apparent to me.In looking at its activities, I have to ask why the opposition chooses to believe that the food manufacturing industry, farmers and retailers are so untrustworthy that codes of practice are not an acceptable way to go. This is really the heart of this legislation. ANZFA is merely putting forward the idea that strict food standards are not the only procedure we should follow if we want to improve the quality of product on our breakfast table. I hear the member for Oxley, as my local spokesman for the opposition, saying that, when it comes to food, the principle that should apply is that only the best will do. That is simply a motherhood statement. We all nod our heads. Given our choice and an unlimited budget, that is the principle we would all apply when we went out shopping. But that is not the real world. People do not go grocery shopping with an unlimited budget.Let us look at some of the statements we hear from the opposition. They flap on about meat pies. I know a good meat pie when I see it, just as I know a good steak or a good cup of coffee or, for that matter, a very good salmon. The same goes for all Australians. Why do members of the opposition think that Australians will abandon all sense of good taste just because laws become less prescriptive, for example?Take coffee. If you follow the prescription of the member for Oxley, all those Home Brand tins of coffee and all the jars of Pablo and International Roast would be outlawed. We would have them purged from the shelves of our supermarkets. If the opposition were in power and nothing but the best were the requirement when it comes to coffee, we would all be required to drink Moccona and New Guinea Gold. There would be no option for people to slum it with the odd jar of International Roast. But I have news for the opposition. Many people like International Roast. Who are we to deny them the opportunity to drink as much of it as they wish?The same applies when it comes to meat pies. If there are manufacturers out there just bursting to reduce the meat content in their pies, they will do so knowing that people have taste buds and a mind of their own. Sure, there may be the odd individual who actually likes pies with less meat. As long as there is no health risk, who are we to leap into their lunch boxes? The rest of us will continue to follow our taste buds.We will continue to seek out quality in the food we buy. Manufacturers who supply great tasting Aussie meat pies will certainly get my custom. They will not go broke supplying ordinary Australians with the quality product they want. No doubt the ALP food police would say the same about fish. Why is flake acceptable when you can eat barra? It would definitely be an expensive exercise eating fish on a Friday under that kind of a regime.The question is not about limiting people's choice when it comes to buying food; it is about ensuring that the product is safe to eat. I have read the Senate Community Affairs Legislation Committee report on this legislation. It is plain that the contribution of that committee, particularly from the opposition and the Australian Democrats, is practically worthless. We would be better served not to have had the report when it is as slipshod and tissue thin as the opposition's contribution to this document is. I worry that in the real world people might think that with the intervention of the Senate some real hard work has been undertaken to consider this bill in some detail.I have no objection to the first part of the report, which is endorsed by coalition members of the committee. It makes a reasonable effort to quiz ANZFA on the process and to place the proposal into context. It states quite clearly and accurately the objectives of the bill. I will paraphrase its statements. The bill seeks to amend the Australian and New Zealand Food Authority Act 1991 in four major ways: creating objectives for the act; providing ANZFA with more flexibility and efficiency in its consultation and decision making processes; enabling ANZFA to more effectively protect public health by allowing the effective implementation and enforcement of new food standards; and allowing ANZFA to prioritise and direct resources to its agreed work program.However, it goes on to make a very important point at paragraph 3.11, where it quotes ANZFA as follows:Essentially, we are obliged to comply with the obligations that Australia has entered into by signing up to the World Trade Organisation agreements which, basically, require us to be consistent with international standards whenever we are developing a standard except where we can demonstrate on good scientific principles that there is a reason to deviate from them to protect public health and safety in Australia. Amending that part of the Act to include a statement that it does not lower the Australian standard would not be consistent with our WTO obligations.At 3.15 it comes to a real crunch:. . . in some cases a code of practice is more appropriate than a standard. At the moment the development of codes of practice is not subject to any statutory consultation requirements. Under the proposed amendments it will be.It goes on to say:There is no intention for wholesale replacement of standards by codes of practice.In the conclusion, it states:ANZFA submitted that this Bill would `facilitate the cost effective development of food standards to keep pace with the high rate of technological and policy change, including industry and consumer demand for greater uniformity of regulation'.In addition, the authority stated that the amendments allow for the implementation of uniform food safety standards throughout Australia. That is an important question on which I have heard nothing but silence from members opposite. At present, every state and local authority has volumes of laws and by-laws that impact on food production. These laws are as different as our various railway gauges.Finally, something is being done to start attacking this ridiculous burden on business. We are going to start hacking into that red tape mountain. Earlier in the debate, the member for Mitchell, Alan Cadman, referred to the report conducted by Charlie Bell of McDonald's about the hundreds of different requirements that apply from state to state and city to city on the same chain of restaurants. In Queensland today, we have a new by-law presented by the state government for implementation by local authorities that allows businesses to be prosecuted for producing cooking smells. How is that for an example of a one-off impediment to business in Queensland?I will now turn to the minority reports. First, there is the Labor report from Senators Evans and Forshaw. They are keen to promote increased regulation and to promote the fictitious notion that ANZFA wants to reduce food standards to the lowest common denominator, which is where some of the members opposite get their script. Let us look at the specifics of their objections to that bill.At point six on page 15 of the minority report, they state under the heading `Substitution of enforceable "food standards" with less stringent "Codes of Practice"':The Bill proposes to introduce Codes of Practice as a supplementary form of food regulation to the existing `food standards'.The Labor senators again state:There was strong concern that things, which had previously been subject to food standards, would come within the more flexible and less enforceable Codes of Practice and that this would greatly reduce or remove the requirements on industry to abide by the regulations.Clearly, we are not talking about substitution; we are talking about supplementary regulations through these codes of practice. It is a bit rich to continually muddy the waters between those two when we are talking not about substitution but about supplementation.Over the page, we have a new variation on the meat and pies argument. The senators there thrilled us with this little gem:A current proposal to allow caffeine in carbonated drinks other than Cola was also raised as an example of something that might look to be minor but which had important ramifications for national dietary behaviour. (In this case, excessive caffeine intake by young children and a skewing of drink preferences away from more healthy alternatives.)Honestly, what is to be achieved by restricting cola use in this way? Coke is not drunk less because it has caffeine in it. Some would argue that the inclusion of caffeine is a selling point used by Coca Cola. Red cordial is another drink many parents dislike because of its impact on children. But would the ALP ban it? Of course not. What about chocolate? Often children get hyper after a few squares of chocolate, but there is absolutely no likelihood that we will see chocolate outlawed.This claim about caffeine is just another red herring. If caffeine is a serious threat to health, it will be banned. But it is absurd to extend the special niche of Coke and Pepsi in the market and to dress it up, as these Labor senators have done, as a health measure. That is pretty crazy and particularly shallow. But if crazy and shallow are the yardsticks, we need to consult the Australian Democrats. The Democrat submission on page 22 is entirely predictable in its cynical treatment of the genetically modified food question. On that page, it reads:The Sydney Morning Herald reported that staff of the ANZFA—the Australia New Zealand Food Authority—admitted to defending and promoting genetically modified foods during the labelling and regulation debate of these foods. This is despite prestigious scientific reports in academic journals stating the possible public health risks associated with genetically modified food consumption.Below that paragraph, the Democrat senators quantify what they were referring to when they talked about these `risks caused by genetically modified food consumption'. They say in a footnote:Research from the Netherlands show that antibiotic resistant marker genes from genetically engineered bacteria can be transferred horizontally to indigenous bacteria at a substantial rate of 10-7 in an artificial gut.They go on to quote that:Researchers in the US found widespread horizontal transfer of a yeast parasite to the mitochondrial genome of higher plants.All this, according to the Democrats, is stating the possible public health risks associated with genetically modified food consumption.I do not know about the mitochondrial genome of higher plants or the behaviour of bacteria in an artificial gut. However, I do know something about genetic engineering and its impact on my gut. Like an increasing number of other Australians, I am a diabetic. Like many of these, I use insulin to moderate my blood sugar level. These days, the insulin I and my diabetic colleagues use does not come from pigs—which was the source of insulin used by diabetics in the years prior to gene technology. These days, four times every day I inject into my gut genetically engineered insulin and it works a treat. Ask any diabetic who has had the choice of insulin extracted from a pig's pancreas or genetically modified insulin and I know which one they will choose. As far as I am concerned, the Democrats can continue to scare people about gene technology, but I am certainly living proof that this technology is a boon to humanity rather than a threat. Gene technology creates many fabulous opportunities to advance the quality of life for people across the world.Finally, in relation to the Democrats' minority report, I want to address the false and misleading comments on page 23 at paragraph 3.2.4. At that point they state:Specifically, consistency between domestic and international food regulatory measures opens up the risk of a situation of standards of the lowest common denominator. For example, the ANZFA's and the ANSFSC's—the Australia New Zealand Food Standards Council—recent approval of Proposal P144 (which sought to raise the permitted cadmium level in Australian foods from 0.05 to 0.1 mg/kg in peanuts in Standard A12 of the Food Standards Code in keeping with standards of the Codex Alimentarius) demonstrates this risk.That statement, which is presented and published by the Democrats as a fact and is now circulated far and wide under the crest and title of the Australian Senate, is bull. There is no international standard for cadmium in peanuts. Unlike the Democrat senators who do not have the problem of an electorate to represent, I speak for the peanut capital of Australia, Kingaroy. I know a lot more about cadmium in peanuts than the Australian Democrats apparently do.For the information of Senator Stott Despoja and Senator Bartlett, no decision on peanuts has been taken by ANZFA or the food safety council that is in keeping with the standards of the Codex Alimentarius. Codex Alimentarius is the international body that covers questions relating to food standards. It was the Australia New Zealand Food Standards Council, a forum of Australian and New Zealand ministers of the Crown, that made the decision to increase the permitted cadmium level in Australian peanuts from 0.05 parts per million to 0.1 parts per million. Codex did not have a specific standard in relation to peanuts and so it is completely false and misleading for the Democrats to describe proposal P144 as seeking to raise the permitted cadmium level in Australian foods from 0.05 to 0.1 milligrams per kilogram in peanuts `in keeping with standards of the Codex Alimentarius'.The decision to double the level of cadmium in Australian peanuts was completely internal within the Australia New Zealand Food Standards Council. It was a stupid decision, driven by political concerns in states such as Western Australia where there are worries about cadmium levels in wheat. Ministers at the Food Standards Council meeting voted to increase the cadmium level because few of them had a peanut industry. Most were more concerned with their own agenda than with the political impact on Australian peanut farmers. So much for the intellectual rigour in the arguments presented by the Australian Democrats and in the minority report that accompanied that report from the Senate Community Affairs Legislation Committee.In the time remaining to me, I want to echo in a short form those comments made previously by the member for Lyons. There are concerns. This is a very technical and difficult area in which people are wont to muddy the waters on occasions. The result of that is that people, whether they be in rural industries or whether they be consumers, are not well served. We need to endeavour to cut through a lot of that political bumph and look at the facts of the matter. The facts of the matter require that we apply rigid standards within our country but also look at measures that will assist industry to provide better information to consumers. By providing an effective code of practice to industry organisations, we can supplement the high standards that we expect in Australian foods. In no circumstances would we endorse the idea of replacing those high standards with some code of practice. What is happening here is the supplementation of the system with one that will increase the ability of consumers to make informed judgments and the ability of farmers and processors to get their message across and spread the word about the high quality of Australian produce and its beneficial impact in the Australian marketplace.17:44:0012405Sercombe, Bob,MPMr SERCOMBEQK6MaribyrnongALP00—While most members of the House would be happy to defer to the member for Blair on the question of peanuts and related matters, I am sure many of his colleagues would be absolutely mortified at the ferocity of the attack he has launched on what in effect is the government's new coalition partner, the Australian Democrats. I am sure that is not something that is going to thrill many of his colleagues on the front bench.All members of this House would be very much aware of the importance of food production and the food industry generally to the Australian economy. Australia has established a most enviable reputation—in fact probably the best reputation in the world—as a clean, green producer of food. This country has an absolutely vital interest in protecting fully the strength of that reputation as a quality, green, clean food producer. Many of the debates that rage presently about food and many of the sometimes emotive discussions about so-called frankenfoods ought to be very much seen in the context of the fundamental importance of Australia preserving that reputation.The importance of this was underlined to me fairly strongly recently in an article in a magazine called Business Week dated 18 October, which discusses the threat to billions of dollars worth of US food exports because of the debate on so-called frankenfoods. The article says:Dave Boettger is ready to harvest 110 hectares of corn growing on his Harlan (Iowa) farm. But a proposed sales contract from Archer Daniels Midland Co. has left him wondering if he can afford to. ADM is offering 8c a bushel more for the old-fashioned corn Boettger grows than for the gene-spliced corn that now accounts for one-half of his acreage. But if testing reveals even a tiny amount of altered genes anywhere in his grain, he would have to pay ADM for the cost of dumping the entire load.The article quotes him as saying:`Pollen from my other fields could contaminate the load, so there's no way that I can warrant that the shipment is 100% nongenetically modified corn. I can't work under this contract.'The article goes on to say:It wasn't supposed to be this way. Genetically modified (GM) crops were sold to farmers as an agricultural revolution. . .Now, they find that the fierce backlash in Europe against what British tabloids gleefully refer to as `Frankenfood' is cutting off billions of dollars in export sales. And even as a trade war over the issue escalates, food processors—while insisting that the high-tech versions are safe—are switching back to buying conventional foods.This is an area in which Australia would be very well advised to tread warily. I am one of those who takes, in general terms, an optimistic view about technological developments, including in biotechnology. As a parliament, irrespective of partisan politics, we all have an obligation to take steps to position this country very much at the forefront of biotech nology. But that cannot be done in a way that does not in any sense take the community and community confidence absolutely with us on important issues in relation to food production. It is against that background that many of the issues that come up in this debate need to be considered.This bill seeks to recast the objectives of ANZFA so that the authority has to explicitly consider the costs and benefits of regulation as well as its existing priorities of considering health, safety and the protection of the community. The bill claims to streamline the consultation process for minor amendments to standards and allows ANZFA to decline to refer draft food standards to a ministerial council when it deals with issues of minor significance. The bill allows ANZFA to charge for services in certain circumstances and claims to harmonise Australian standards with those of trading partners.What the bill does not do, however, is quite important as well. It does not seek to protect public safety; that is, it very much puts trade agreements ahead of standards. It reduces the focus on consumer interests. It elevates trade and commercial considerations over consumer information. It substitutes codes of practice for existing food standards, diminishing enforcement powers and the requirements of industry compliance as well as making it difficult for consumers to get action via ANZFA. Instead they will have to rely on trade practices legislation, which would certainly be significantly more expensive, difficult and time consuming.The legislation limits public participation in decision making by removing the requirement for publication of proposals in the local press for matters of what are quoted as being of `minor significance'. The bill does not answer public concerns over greater accountability and disclosure to consumers on food issues. It does not address concerns which have been expressed periodically about ANZFA's independence and the transparency of its decision making.ANZFA has a vital role for the reasons I indicated at the outset in assessing whether or not certain products should be available in Australia. More than this, they are expected to make sure that safety is maintained and that food products can be confidently consumed in the knowledge that there is no health risk to the consumer. Some of the measures in this bill put those expectations at risk.Consumers are lacking information about what is in genetically modified food, what risks there are to the environment and if there are any health risks involved. They would like to have confidence in bodies such as ANZFA to make a professional and thorough assessment of any new products in order to allay those fears. At the moment this is not happening and this legislation, in its current format, is not going to change that. From the government's point of view this is very much policy making on the run. It really does nothing to enhance consumer confidence and confidence in Australia's enviable reputation as a producer of clean, green foodstuffs.The interim arrangements, where the minister will assess applications, demonstrate the government's approach to the problem. There is already great confusion about the future of biotechnology and its implications. If the government does not act to put a proper assessment model into place that ensures safety, transparency and informed debate, it may be damaging Australia's long-term future as a world leader. There are many questions and not enough answers from the government. Will food labelling be detailed enough to give consumers the information they need? Does ANZFA have the capacity to perform rigorous testing to ensure manufacturers' claims are accurate? Since ANZFA does not possess any laboratories, will it rely on test results submitted by the manufacturers?What amount of genetically modified material will need to be in a product to require it to be labelled? Will the public be able to be involved in the approval process? Will the minister be responsible for his decisions while he acts as the approval body in the interim period? What does ANZFA consider `acceptable risk' when assessing possible health risks from new foods? All these questions do need answers, and they are not forthcoming. In fact, this bill raises even more doubts than it answers. Amendments to the ANZFA Act contained in this bill would allow the authority to fast-track some applications and forgo the requirement of informing the public through advertisements in the national press. Applications that are regarded as `less significant' by ANZFA would be treated in this way. What exactly does `less significant' mean? This bill does not define the term, so we have the possible situation of a personal decision being made by an ANZFA officer, allowing a product to be approved or rejected without the expected transparency.Accurate approval, testing and labelling are important. Knowing exactly what is in the food product is vital to both adults with allergies and parents of young children with allergies or behavioural problems linked to diet. The clear and detailed labelling of food additives recognises this. What will these people do if these requirements are not met? Take pot luck with the products and see if they have an allergic reaction? This is obviously unacceptable, and yet the amendments in this bill raise the possibility of this being their only alternative.There are also some concerns about the relative importance that ANZFA will give to consumer—as opposed to industry—interests under the provisions of this bill. I have already mentioned the fast-tracking of applications, which would mean reduced public scrutiny in the approval process. However, there are other amendments that also give rise to disquiet about ANZFA's focus. This bill, if passed unamended, contains the potential for conflict between commercial and public health goals. One section of the bill recognises our international obligations to agreements in such a way that we may be required to lower our standards of food regulation to comply with overseas requirements. Similarly, another section on harmonisation of arrangements would allow Australian standards to fall to match lower overseas standards. This is particularly important given the trend in the US and other trading partners towards lighter regulation and labelling regimes for genetically modified food. We cannot give absolute priority to short-term trade and export considerations at the expense of public health issues. There is also concern about the perceived independence of ANZFA, given that it will have the power to charge application fees to producers wishing to get product approval. Given the continuing growth in genetically modified food products requiring clearance, the positive impact of these fees on ANZFA's budget is obvious. This bill also proposes that unsuccessful applicants be repaid their application fees. This raises the possibility that the authority would be dependent on approving applications in order to meet its budget—a situation which is clearly unacceptable. With the Minister for Immigration and Multicultural Affairs at the table, one might wonder, if this situation were introduced in his portfolio, whether the people who had unsuccessful visa applications would expect to get a refund in those circumstances. One can hardly imagine that situation arising. Having this system in place in the format that the government is proposing raises some fairly important issues in terms of transparency, objectivity and professional conduct.There is already disquiet in many quarters about ANZFA being too close to the food manufacturers. Their continued resistance to full labelling in the face of overwhelming consumer demand is just one example. The ANZFA argument is that `substantially equivalent' goods did not need to be labelled, which is, as the Liberal South Australian Minister for Health, Mr Brown, said, `effectively an argument for no labelling at all'. Similarly, the Liberal ACT Minister for Health, Mr Moore, has expressed concerns publicly that ANZFA were so strongly against labelling that `even though they followed the instruction, they still argued against it'.There are also contradictions about the importance of public health and consumer issues under the amended bill, including the reference to consumer information as a `matter to which ANZFA must have regard' rather than as an objective of the operation. The related concept of `acceptable' public health risk is also of importance in this area. There are differences between the risk assessment process recommended to ANZFA by the national competition policy review and what has appeared in the bill. The national compe tition policy called for the application of `the best available scientific data and risk principles' in assessing risk. The bill has watered this down to `sound scientific principles'. Similarly, proposed section 2A(a) of the bill talks about ANZFA providing `equivalent public health protection' rather than `public health and safety'. These references lead one to believe that there is an implicit endorsement in this bill of a position accepting that, in some cases, it may be impossible to guarantee public safety and that standards may be set at a level of acceptable risk to public health and safety.Witnesses to the Senate inquiry—which other members have referred to—expressed the need for a real review of food standards and ministerial accountability in the light of the recent food labelling situation. Consumer acceptance of these products is essential for their success and for continuing Australian research in the biotechnology area. There is already public apprehension about the safety of genetically modified foods. Changes to ANZFA that loosen the approval process will act to increase, rather than allay, those concerns. This has consequences for the industry and scientific research and development, as well as for the general public. There is already a consumer backlash against genetically modified foods overseas, as I have referred to earlier in this speech, and it has resulted in very large institutions advising against them. The Deutsche Bank, for example, recently advised institutional investors to sell their shares in companies developing genetically modified crops. To quote the Deutsche Bank:We predict that GM organisms, once perceived as a bull case for this sector, will now be perceived as a pariah.This is not just an overseas phenomenon. Dr Peacock, the head of CSIRO's division of Plant Industry, stated at a conference a few weeks ago that the public was not ready for genetically modified bread and that CSIRO would not release any commercial crops until it was. Dr Peacock stated that the Australian public `needs to know a lot more about gene technology before it's ready for its use in food'. Industry leaders seem to agree with him, with news in August this year that the major food manufacturers Sanitarium, Cad bury-Schweppes, Master Foods, Mars and Heinz had either changed to GM-free sources or were in the process of eliminating them from their products in the Australian market.Farmers, consumers, scientists and industry all support the regulation of genetically modified organisms and a public information campaign to advise the public on the facts about these new foods, and yet this government continues to inadequately respond to those perceived needs, as important as they are to the future of fundamental Australian industries such as food production.Until consumers have enough information to make informed purchasing choices about genetically modified food products, the trend will be to reject these products. Unfortunately, in the current situation, consumers are not given enough information. It is a large gap in an otherwise helpful regime. Foods list ingredients, calories, fibre content, details of additives and country of origin. A shopper can choose to buy Australian, to purchase free-range rather than battery eggs and to buy dolphin friendly tuna, and identify products that contain a chemical that may give them an allergic reaction. People from religions with strict food requirements, those on medication and those who follow a vegetarian diet can pick up a product in an Australian supermarket and find the information they need to decide whether that item suits their requirements. This is not the case for genetically modified foods.The arrogance of some manufacturers in ignoring the call for labelling can only damage this infant industry. ANZFA gave chemical companies nine months to register their genetically modified foods for approval, and I understand they received only two applications. Companies simply ignored the requirement, gambling that the government would not require the recall of hundreds of products from the shelves. It was a gamble that paid off when the government caved in and extended the deadline. These unassessed food products remain on sale all over the country.There is overwhelming public support for full labelling of these products. Consumers are entitled to make purchasing decisions on the basis of correct, reliable information. If public confidence in genetically modified products and their labelling continues to fall, it will have severe effects on the food industry and on the overall reputation and integrity of biotechnology research and development. The government really does need to lift its game in this respect. This bill is not one which, frankly, inspires a great deal of confidence in their capacity in these areas.18:02:0012409Gambaro, Teresa, MPMs GAMBARO9K6PetrieLP10—I rise today to speak in support of the Australia New Zealand Food Authority Amendment Bill 1999 [No.2]. I do agree with the member for Maribyrnong on a number of issues. It is an extremely complex bill because it is an extremely complex issue. He spoke a little while ago about `country of origin'. I know that his government had no luck tackling some of these difficult problems with country of origin labelling. Here we are dealing with something that is probably twice as complex. Recently at a meeting of health ministers there was disagreement from all states. The different health ministers held views across the spectrum. It is important that we get absolutely uniform support from the states. This is not something that the Commonwealth alone can bring in; we need to have a uniform approach and consensus before this can go any further.The bill amends the Australia New Zealand Food Authority Act 1991 in a number of ways. It will have the overall effect of improving the ability of the Australia New Zealand Food Authority to meet its prime objective, namely, to protect public health and safety through the setting of appropriate food standards. It is vitally important that this objective is not lost in the maelstrom of detail in the proposed amendments. ANZFA is responsible for making sure that all food in Australia, including genetically modified food, is safe. All genetically modified food is rigorously tested by ANZFA, including checks on the potential toxic effects of food and nutritional changes. ANZFA has a team of highly qualified nutritionists, toxicologists, dietitians and microbiologists to check the safety of food. But its main aim is to protect public health and safety. ANZFA also has an important role in providing consumer informa tion and promoting trade and commerce. Australia is a world leader in making sure that medicines and a number of other products are safe and of a high quality. We have to be respected for the work we are doing there and the standards that we have maintained.From the outset it must be said that Australian consumers are becoming increasingly sophisticated and discerning about what they choose to eat. That is due to a change of dietary requirements and the desire to lead a healthier lifestyle. I think we all, including many of us in this House, aspire to lead a healthier lifestyle. There are also allergies. A wide variety of people in the community have allergies to wheat products and gluten. A number of the speakers mentioned the need to ensure that food is correctly labelled. Certain medicines as well have gluten products in them that can cause adverse effects. It is important that they be labelled so the consumer understands and has knowledge of the ingredients that are in products. It is for this reason that it is critically important that the general public continue to have confidence in the authority and that the work they do continues.However, there are a number of shortcomings in the act, and a number of speakers have spoken about the work the authority does. The amendments in this bill have arisen from the different reviews that have highlighted the great inadequacies of the 1991 act. These include the National Competition Policy Review of 1998, the Review of the Model Food Act, the Review of the State and Territory Food Acts and the Food Regulation Review, also known as the Blair report. The result of these reviews was a collective desire to streamline food setting standards and the processes of the authority.The most significant shortcoming of the 1991 act is the length of time it took for the authority to assess, and the Australia New Zealand Food Standards Council, ANZFSC, to make decisions on, less significant applications. That is why it is so crucial that the proposed amendments to the bill give the authority the power to make decisions on the Food Standards Code where there has already been clear direction from ANZFSC. It must be emphasised that ANZFSC has the power of veto over any decision by the authority. This sensible amendment will shorten the assessment process for applications and proposals, therefore increasing flexibility and reducing the time taken up with making relevant decisions.The bill will clearly enable the authority to improve its efficiency, transparency and accountability in meeting its prime objective of protecting public health and safety, and that is what it is really all about. Sometimes the competing social and community benefits and the business objectives and goals do not move in the same direction, and I think it is important that consumers and the business community work towards protecting that public health and safety. It must be absolutely utmost in their minds and also be the goal of setting the right standards.The streamlining of the food standards process will let the authority deal with less significant applications and proposals. One of the problems has been the unnecessary delays and the accompanying red tape. These amendments will ensure that that no longer takes place. The object of the act makes it clear under proposed section 2A that people must enjoy the benefit of equivalent public health protection in relation to food throughout Australia and New Zealand and that adequate information relating to food is provided to help consumers make informed decisions about food. Many people do make those informed decisions. It might be the country of origin labelling that they look at. There are many consumers who choose to buy Australian-made products only, and that is to be commended. I think we should promote and encourage the consumption of our own food and support our own food manufacturers.Decisions of the business community must not be distorted and markets must not be fragmented by variations in the law in force in Australia and New Zealand in relation to standards. There also needs to be a workable framework, and that is what this is all about: providing a workable framework for minimum but effective regulation of food. There needs to be consistency between domestic and international food standards. That is very important as markets become more globalised and as we are competing in an increasingly competitive world. I think it is important to highlight the necessity of reducing costs and distortions to business imposed by delays and differing standards. This will ensure that new products can be placed in the marketplace in a more timely and cost-effective manner. The government is committed to reducing unnecessary delays to business as well as protecting public safety. However, this commitment to business should not be at the expense of public safety. As such, the authority will be required to specifically consider the costs and benefits of regulation. The method determined by the authority to take on additional food standards work will be on a full cost recovery basis but not on a profit basis. This will ensure that the appropriate resources are spent on the issues of greatest priority to the community.Of specific interest in the bill are amendments to section 10 of the act which have arisen from recommendation 25 of the national competition policy review of the authority act. Section 10 deals with a clear set of objectives for the authority. They are that there should always be the protection of public health and safety and the prevention of misleading or deceptive behaviour. In developing food regulatory measures, the authority must also have regard to the need for standards to be based on risk analysis that uses sound scientific principles and the provision of adequate information relating to food to enable consumers to make informed decisions. There also needs to be the promotion of consistency between domestic and international food standards, the promotion of trade and commerce in the food industry and the promotion of fair trading in food. The reality is that the food regulatory system in Australia has been very complex and extremely fragmented. It has multiple jurisdictions spread across the three spheres of government. As I mentioned earlier, a recent meeting of health ministers only added to that particular assumption. There has been a pressing need across all states and territories to ensure that there is harmonisation of food standards to reduce the complexity of differing food standards.Of particular interest to me are the proposals here to promote consistency between domestic and international food standards and the associated promotion of trade and commerce in the food industry. There is a clear link between the two objectives. As Australia and New Zealand work towards the harmonisation of food standards with other regions of the world, there will be greater scope for developing exports in food industries for both countries. However, my concern is that the harmonisation of standards should not mean the reduction of Australian standards to international levels. We have a great deal to be proud of in Australia.I would like to mention an industry that is really forging ahead. I represent an electorate where the seafood industry plays a large part, and the aquaculture industry is one that has clearly benefited from the level of expertise in food standards. I would like to highlight the great work being done particularly in our export markets. Therefore, it is critical that Australia maintains a rigorous regulatory regime for food safety. One of the greatest assets for Australian food exports is a perception of high quality and healthy products. We have that in a number of our exports including the seafood industry, that our seafood comes from pristine waters and our aquaculture products are of the highest possible standard. We have a perception of having a great food industry and of having high quality and healthy products, and I think that should always be an objective. Consequently, this bill will help facilitate and strengthen this perception, and all that can do is enhance Australia's exports and ultimately employment opportunities.With this in mind, it is worth while briefly considering a few pertinent functions of the Australia New Zealand Food Authority under section 9(7)(i), which works to ensure that this rigorous commitment is maintained. State and territory laws will be harmonised. There will also be coordination, monitoring, surveillance and enforcement of activities relating to food in Australia. There is a need to participate in international, bilateral and regional negotiations on matters that may be included in standards, and there is also a need to undertake other tasks related to food regulatory measures: for example, the development of food safety standards infrastructure projects.Finally, as technological advances are occurring rapidly in food products, it is reassuring to know that the authority will be given the appropriate authority to deal with the issues that confront food standards in the 21st century. Food production is becoming increasingly sophisticated, utilising the latest advances in technology. I welcome the stronger regulatory role for the Australia New Zealand Food Authority, which will ensure the continuation of safe food for Australians. As such, I commend the bill's passage to the House.18:14:0012411Theophanous, Andrew, MPDr THEOPHANOUSQJ4CalwellALP00—I come to this debate on the Australia New Zealand Food Authority Amendment Bill 1999 [No. 2] with a certain amount of history, having been the parliamentary secretary for health with responsibility in the Keating government for the Australia New Zealand Food Authority. In fact it was while I was parliamentary secretary that we formed with New Zealand ANZFA and I was actually an official signatory, on behalf of the Prime Minister, Mr Keating, to the agreement between Australia and New Zealand that formed the authority. That time was one of great optimism as to what would happen to food standards and how the authority could play a very constructive and positive role in actually promoting our food industries in Australia and New Zealand, assisting the export industries and ensuring that we had the highest food standards.Part of that atmosphere of optimism was due to the fact that some of the very thorny issues which had existed for quite a long time were tackled in that period when we were forming the authority with New Zealand. The issues involved in the labelling of food—what we should say about food being an Australian product or Australian made or Australian manufactured—were very complicated, as you might remember, Mr Deputy Speaker. They created a lot of division between the approaches of the consumer, industry and the union movement and we brought these three groupings together to resolve some of those questions. It was interesting that when the new government came in it sought to adopt some of our recommendations on this issue and claim the credit for itself. The `Australian made' issue was not satisfactorily resolved by this government and it still contains some difficulties which we have to address.I was very disturbed when the first version of this legislation came through. We saw in this legislation an attempt to totally water down the enforcement role and the real regulatory role of the Australia New Zealand Food Authority. It appeared at first that the government's response to the Blair report was to actually give a huge emphasis to deregulation and to the creation of codes of practice as a replacement for enforceable food standards.Of course this created quite a bit of angst in this parliament amongst the people who know about this issue and, as a result of that, the whole matter was referred to a Senate committee for consideration. It is unfortunate to some degree that the Senate committee divided on party lines, with the government majority taking the view that there was no particular problem with this legislation whereas the ALP and the Democrats felt quite differently and that there were serious questions about this legislation. And there are serious questions. If we are to have a philosophy which moves away from enforceable food standards towards more and more non-binding codes of practice, how are we going to protect people, firstly, in the area of health and, secondly, by ensuring that we have the highest standards for our food resources when we are trying to publicise Australian food in both domestic and export markets as some of the best in the world?This move, which I believe was primarily ideologically driven, although some say that it also has to do with representations from the food industry, has been re-examined as a result of the Senate inquiry to some degree and the government has made some concessions. However, the Labor Party is of the view that further amendments need to be made before the bill can be approved. We need to make it perfectly clear that this is not going to result in the wholesale dumping of enforceable food standards and the wholesale adoption of non-binding codes of practice, especially in areas where human health is a very serious issue.When I was parliamentary secretary there were a number of such cases. You may remember the famous salami case in South Australia where a little girl died, and that led to a lot of legislation and also a lot of angst about why this had happened. I think even criminal charges were finally laid against people in relation to the way the factory had been operating. This is why the enforced codes are very important. But one of the issues which the government has avoided in its three years of operation, one which we were hoping to deal with in the negotiations between the states and the federal government on this question, is the issue of how enforcement was actually going to be put into place.It is no good having so-called enforceable codes if the actual enforcement does not take place. The states have a responsibility under the act to enforce the standards that are determined at a national level, but the enforcement by the states has been, to say the least, a mixed picture. In some states, there has been great laxity in the enforcement of food standards, especially in restaurants, some supermarkets and places where there is a lot of food handling. This laxity in enforcement by the states has resulted in some very serious cases of food poisoning and illness. Even where the standard action existed—and I repeat that point: even where the standard action existed—we have had this situation.I want to know how this legislation will help to make enforceable food standards a reality with respect to the states. What are we going to do? Have we negotiated any further agreements with the states? A lot of the state governments shift this responsibility down to local councils. There has been a movement firstly from the national enforced standard and then to the states. The states then say that it is the business of the local council. As we know, in many local councils certain things which ought to happen do not happen. There have been cases where council officers have overlooked their responsibilities or have not enforced the standards that they ought to enforce.We have to get our act together with food standards, especially when they relate to human health. With so much food production, with so many different systems of food production and with the introduction of genetic engineering, we could be left with a practice that leads to laxity with respect to food standards and to serious health problems. Every now and then in this parliament we hear of examples of this. The minister even gave examples recently where some products which were dangerous products from a health point of view got through the system of the authority and somehow ended up on supermarket shelves.Having said all that, I commend the authority for their role in setting standards. The way they do their scientific analysis and the way in which they take into account many of the health issues, not just here but internationally, is something that ought to be commended. The government, however, rather than recognising this, has reduced the staff of the ANZ Food Authority in the last few years. It should not be doing this. This is a very mean and short-term view of what is needed in this area because, once you enforce health standards—once you do have an industry that is known for its high standards—you have an opportunity to increase your export markets by emphasising the fact that your food is clean, that it is healthy, that it has passed tough standards and that it can therefore compete, so that when somebody in Asia or Europe or the Americas has access to Australian food, they will be able to say, `Aha! That food has passed tough standards. That food is worth buying. That food will not be any kind of threat to me or my family.' We should think about that, because competition in this area is not just a matter of price; it is also a matter of quality and a matter of standards, especially health standards.We ought to be opposed to any lowering of standards and to the continuous development of non-binding codes of practice. You might ask, `What is wrong with non-binding codes of practice?' The problem with them is that they are non-binding. What happens when a manufacturer decides that, since this is non-binding, he will not bother with it? He cuts corners, as happened in the salami case years ago. The manufacturers were cutting corners in the production. They were breaching the regulations and cutting corners, but they were maintaining, `Other people are doing this sort of thing. We have to compete in the marketplace in terms of the cost, et cetera.' This is the problem with non-binding codes of practice, especially when the price mechanism operates as a factor.Food for human consumption directly affects health issues, and we must not fall into this trap. I would like to hear a lot more from the minister about how he will make sure that these non-binding codes of practice will prevent ratbags from saying, `Well, it's non-binding. Therefore I will ignore the code of practice and I will produce food that lowers the standard.'In discussions, the authority raised the issue of the World Trade Organisation agreement on sanitary and phytosanitary measures. It said that Australia has to be in harmony with these measures, and that in some cases we will have to reduce the high standards that we have in Australia vis-a-vis other countries in order to achieve the harmonisation. The Senate committee examined this issue in some detail, and it was certainly the view of the Labor members of the committee that the agreement—this particular WTO agreement—does not require a lowest common denominator approach to harmonisation. I quote: `It merely encourages harmonisation and requires standards that exceed the international benchmarks to be based on scientific justification or an appropriate risk assessment.' In other words, you do not have to go to the lowest common denominator, as determined by the WTO. You can have a higher standard, provided you can justify it for health and scientific reasons or through an appropriate risk assessment.This is a very important point because it means that those who claim that we have to reduce to these lowest common denominators in order to meet the WTO arrangements are wrong. We should be saying to the WTO, `Look, we have scientific evidence in this particular case.'Sitting suspended from 6.30 p.m. to 8.00 p.m.QJ4Theophanous, Andrew, MPDr THEOPHANOUS—Before the dinner break, I was making a number of points about the importance of ensuring the integrity of our food standards regulation system, ensuring that we do protect public health in relation to food standards and ensuring that Australia's reputation for very high standards in relation to food are retained. I expressed a number of concerns about some of the things proposed in this legislation. As I mentioned, the matter went to a Senate committee and, as a result of that deliberation, there was a majority report. There was also a minority report that recommended a number of amendments. I understand from the parliamentary secretary that negotiations about the ALP's amendments have proceeded and that we are about to conclude a satisfactory resolution, at least from the point of view of the concerns that we have expressed. I hope that resolution does take place. I repeat the concerns that I have about ensuring that we do maintain enforceable standards. If we are going to have some deregulation of the system, we need to ensure that people do not abuse the existence of those deregulated codes because, if they do, we will be back where we were with serious issues concerning food standards. I remind the House that, as I was saying before the dinner break, when I was parliamentary secretary in relation to this matter we did have some concerns about matters of food poisoning and about laxity of standards, especially in the area of food production and, in some cases, processed foods. We even had a little girl in South Australia who died as a result of eating poisoned salami. We do need to be vigilant in this matter. The government appears to be making an attempt to reach an accommodation across the parties in relation to this matter so that we can ensure that the ANZ Food Authority retains its teeth, retains its ability to enforce standards and to have enforceable standards and also retains its overall coverage and monitoring of the situation. With respect to the charging of fees, I think a compromise has been reached and that is fair enough. That was not my main concern. My main concern is that, even when we have had enforceable standards, very often we have not required state governments and even local councils to actually enforce those standards. We have had cases of shops, restaurants and other places where food is handled where, unfortunately, the standards have not been met and we have had situations where people's health has been endangered. The other aspect I referred to had to do with the harmonisation with the World Trade Organisation's requirements. As I was saying before, even the parliamentary committee, at least the Labor members of it, were of the view that the WTO Agreement on Sanitary and Phytosanitary Measures does not necessarily require Australia's food standards to be reduced. We do not want to get down to the lowest common denominator in food standards. What we want is to have Australia's reputation in relation to high food standards maintained by the ANZ Food Authority, and when we do that we will have a competitive edge in relation to food. The international requirement in terms of harmonisation is that in fact standards can be maintained. (Time expired)20:04:0012414Washer, Mal, MPDr WASHER84FMooreLP10—The food regulation industry in Australia is currently undergoing a welcome series of reforms. The Australia New Zealand Food Authority Amendment Bill 1999 [No. 2] is part of this process, which began with the Prime Minister's 1997 policy statement More time for business , where a commitment to review food regulation in this country was announced. The Food Regulation Review was then undertaken by a committee made up of industry, consumer and government representatives from the Commonwealth, the states and local government, as well as representatives from New Zealand. The bill on which I am talking today proposes changes to the Australia New Zealand Food Authority Act 1991, based on the recommendations of the Food Regulation Review. The bill also takes into consideration the findings of the national competition policy review into the act itself and the Review of State and Territory Food Acts.Under the Australian Constitution, each Australian state and territory has responsibility for regulating food, and each has their own food legislation for this reason. Nevertheless, in order to maintain the standards set out in the Food Standards Code an agreement was signed in 1991 that provided for a uniform set of standards to be adopted on a national basis. This heralded the birth of the Australia New Zealand Food Authority.Looking through the literature on food regulation in Australia, you notice various obstructive and recurring themes, including: inconsistency, fragmentation, lack of uniformity, insufficient education, too complex, too wasteful, duplication of authority, insufficient consultation with small business and inadequate access to information concerning food regulation. This bill is an attempt to rectify many of these problems by altering the objectives of ANZFA. While still maintaining the health, safety and protection of the community as a priority, ANZFA must also consider the costs and benefits of its regulation.Basically, ANZFA is to follow many other coalition government initiatives and become more business friendly. The focus of the bill is to provide a minimum set of standards for the food industry with a `light touch' approach. This is a reflection of the findings of the Food Regulation Review, where it was found that the costs to business when there is a breakdown in the safety of food supply is an incentive to ensure that food safety regulatory systems are maintained. To illustrate this, the following passage from the executive summary of the review states:Most agrifood businesses employ practices and equipment which match or exceed the standards required by law. During the course of the Review, it was noted that many proprietors and managers have difficulty separating what they do as a natural part of good business practice from what they do solely to comply with food-specific or food-related regulations.Regardless of regulations, most food suppliers have strong incentives to produce safe food of the type consumers want and for which they will pay. Indeed, loss of market share and profits for a company involved in a product recall, for instance, may be substantial. The review cited one company losing $6 million this year after a product recall. Profits can suffer for many years after such an event. This is not to say that this government believes that the fear of losing money will ensure businesses will always comply with food safety regulations. Public health and safety must be protected by adequate legislation. There are around 150 acts and associated regulations in Australia, not including local government by-laws, and more than 90 separate national food product standards. According to the Food Regulation Review, these are all enforced by various Commonwealth departments and statutory bodies, over 40 state and territory agencies and more than 700 local government bodies.Food regulation laws in this country have resulted in Australia having an enviable record of food safety. The review stated that Australia's reputation is one that is well earned. But that is not to say that we have been able to prevent a large number of food poisoning cases each year, and it does not take into account the number of food borne pathogens, such as salmonellosis, that have been increasing in many industrialised countries since the 1980s, including Australia and New Zealand. ANZFA estimates around 11,500 people get food poisoning every day, which equates to more than four million people a year. A conservative estimate states that if we were to cut our food borne illnesses by 20 per cent, Australia would save around $500 million a year in health costs and lost productivity.Tragically, in this decade alone there have been at least four deaths from food borne illnesses and permanent health damage to many others, including 23 cases of haemolytic uraemic syndrome in one outbreak. Perhaps it is impossible to completely eradicate all cases of food poisoning as there are just so many variables and on the whole Australians can expect and receive safe food for themselves and their families with the 20 billion meals that we consume each year. But the wide publicity gained from such scares as the peanut butter recall and the death associated with the Garibaldi smallgoods company has meant that our food regulatory bodies must be more transparent and accountable than ever.The theme that came out of recent consultations with stakeholders was the call not to change our basic rules and regulations but just to make the current system as a whole more efficient. The Food Regulation Review uncovered two major sources of complaint from all sectors of the agrifood industry. One was that some food laws and regulations were inappropriate, for example, too ambiguous or unenforceable. The other was that the inefficiency of the food regulatory system imposed unnecessary costs on the food industry.The new food safety reforms that are included in this bill will apply to all Australian businesses that produce, manufacture and serve food. The aim of the reforms is to help prevent food poisoning before it has a chance to happen. The new standards will apply not only to retailers, restaurants, hotels and transporters of food but also to nursing homes, child-care centres and school canteens. Special provisions will apply to charity events such as sausage sizzles, and they will be simple to comply with. Contrary to reports that appeared in a Melbourne newspaper a couple of weeks ago, sausage sizzles and meat pies at your local football match are not under threat of extinction because of these reforms.If a business is already following commonsense measures, not a lot will change. According to an ANZFA fact sheet for business, if you are actively managing your business to achieve the best practice outcomes that are necessary to fully protect your customers, a food safety program will simply be a formal, written demonstration of what you are already doing. The fact that these reforms will be so encompassing merely emphasises the point of this bill which is that we must be more business friendly, and regulations must be less complex and difficult to understand.As reported in today's West Australian, yesterday the state health minister, John Day, launched the translations of the FoodSafe food handler training program. It will be available in Cantonese, Mandarin, Vietna mese, Malay, Indonesian and Thai. Mr Day said:Food hygiene is a big public health issue in WA, where about one-third of every household uses its food budget on food prepared outside the home. Our position, as a major tourist destination, means hygiene practices in the food industry affect our reputation in domestic and overseas markets.This bill will ensure a framework for minimum but effective safeguards that are uniform, well documented and simple for business to follow. I commend the bill to the House.20:15:0012416Hall, Jill, MPMs HALL83NShortlandALP00—I have serious concerns about this legislation. I fear that, in its current form, the Australia New Zealand Food Authority Amendment Bill 1999 [No. 2] would simultaneously give ANZFA more delegated power, weaken public notice requirements and force ANZFA to rely on industry to supplement its budget whilst replacing binding standards with unenforceable codes of practice. These are serious concerns. These changes could lead to not only a conflict of interest but also a major decline in the quality and the safety of our food. We need to ask ourselves why there is any need for food standards or regulations. The answer is, of course, that food safety is a major public health issue. There have been some notable examples of contamination that have taken place—the Garibaldi incident, mad cow disease in the UK and even the salmonella in orange juice. Regulations and standards are in place to ensure that the food that all people in Australia eat is safe and is of a certain quality and so that we can be confident that, when we buy food, we are getting a certain standard and quality.What is the role of government in this process? I believe it is the role of government to ensure that there is a proper legislative framework in place so that the community can be confident that they will not have their health jeopardised in any way by the food that they eat. Consumers need to be very confident about the food that they consume. As a government, those people on the other side of this House must be very confident that the legislation that they pass will not lead to any erosion of the quality of the food that people in this country eat. We have a public responsibility to see that in absolutely no way is the public health or safety of Australian people jeopardised. A move to a non-binding code and self-regulation can only lead to a decline in the safety and the quality of food in this country. You only have to look to the US to see some of the outstanding examples of food contamination, where many thousands of people have actually lost their lives through contaminated food, and that is a country where there is a lot of self-regulation. I feel so strongly about the quality of the food that I eat that I made a conscious decision to no longer eat meat because I felt that the quality of that meat could not be ensured.I can see that there is no way that this type of legislation will lead to a higher standard of food being out there in the community. This is not what we want here in Australia. Australians need to know that the food that they buy and eat is of the highest quality and absolutely safe. The replacement of the words `public health and safety' with `equivalent public health protection' is a watering down of protection for consumers. It leads to an increased concern—about which I have already spoken—about consumer protection and public safety. As I have said, health and public safety is paramount. The words `equivalent health protection' are just not good enough. It is a watering down of what we expect for the safety and quality of our food. The move to a cost-benefit analysis, as has been set out in the proposal, is another issue of great concern. I believe that community health and ensuring the quality of our food override all costs. There is no cost too great to ensure that the food is of the highest standard and the best quality. Cost is only a secondary concern. Public health is our number one priority.Another goal of this legislation is a simplification for industry. Once again, that is something that should be secondary to public health and safety. To simplify the legislation to make it easier for industry is very worth while, but what is the legislation about? It is about food standards, community health and quality. I think it is very noble to have the concerns of industry and simplification in our minds, but I think it is much more important to ensure that we can tell the people of Australia that the food they eat is good.The minority report tabled by Senators Chris Evans and Michael Forshaw identified a number of concerns, and these are concerns I share. It is also interesting to note that evidence given by the majority of witnesses to that Senate inquiry on the legislation was very critical of the proposed legislation. I will refer to the evidence given by a couple of those witnesses. The Australian Consumers Association were scathing in their criticism of ANZFA for the proposal to downgrade requirements for food labelling. ANZFA does not have the most brilliant record, and now we are looking at giving it more power.The Dietitians Association of Australia was blunt in its view that paving the way for the replacement of legally enforceable standards with non-binding codes of conduct was a regressive step in terms of public health and safety. Once again, that is reinforcing what I have already said. We need to have regulations that can be enforced. We need standards out there that are enforceable. We cannot allow non-binding codes of conduct with something as important as our food. The ACTU food unions were also concerned about the operation of ANZFA and further moves to deregulation. They called for it to be scrapped and replaced with an entirely new regulatory authority. Once again, this is reasonable. They wanted something that had a genuine focus on consumers.Coming back to the core of what I have been saying, food regulation—quality food—is about consumers and public health. The Food Industry Council of Australia had criticisms of the broad cost recovery proposals and the implications of the fee-for-service approach. The Consumer Food Network had fears that the bill's call for equivalent standards was code for continuing a trend for Australia to adopt the lowest common denominator. It should be the highest common denominator that is adopted, not the lowest.Madam Deputy Speaker, you can see that there are a lot of concerns, and these are not only my concerns. I believe that the concerns of these witnesses are reasonable, because these groups can see the possible ramifica tions of the downgrading or watering down of food standards in Australia. It is a public health issue. It is even easier to understand their concerns when you consider the decisions that ANZFA could make and the recent debacle over food labelling. We look at the meat pie issue—meat pies with no meat in them. Rather than encouraging manufacturers of pies to label pies, stating what is in them, and having a requirement for a certain meat content, we are going to have meat pies with no meat. Rather than encouraging pie companies to be like the award-winning Federation Pie Company that operates in my electorate, whose stamp is the quality of the pies that it produces, ANZFA was going to allow meat pies with no meat.Removing the requirements concerning food irradiation and the need for genetically modified food to be labelled are issues of great concern in the community. People in the community want to know what they are eating: they want to know what is in what they are eating. A lot of people would be quite happy to eat genetically modified food, but they want to know that that is what they are eating. People need to be able to have the choice of saying, `Yes, I want genetically modified food' or, `No, I do not want genetically modified food.' ANZFA's reputation and record in that respect has not been so good.These issues are of concern to the community and you have to ask why. Part of the reason that we in this place need to be looking at this is that Australia has a reputation for being a country that is clean and green. We must protect that reputation. When it comes to world trade, we have to make sure that our products meet the standards of other countries. We have to make sure that chemicals in our food are not chemicals that are not allowed into various countries. We have to make sure that we have the best scientific practice. This legislation talks about `sound' scientific practice. We want the best. In this country, we deserve the best. We do not just want sound scientific practice.The other issue that is very important in this whole debate is the funding of ANZFA. There has been a cut in its revenue from $9.1 million to $6.4 million this year. ANZFA's funding is inadequate. There has been a move to introduce a degree of cost recovery in this legislation. Whilst there is room for introducing some cost recovery, I do not think what has been set out in this legislation is the best possible formula. Cost recovery should not replace the current funding mechanism. There is room for putting in some charges, but the government should not include in this legislation the requirement that, if an application is unsuccessful, the money will be refunded. That is a disincentive for ANZFA to reject any application.Unfortunately, this government is about making things easy for its friends in business and industry. It does not seem to care about ordinary, average Australians—the people who look to government to ensure that the food they eat is fit for consumption. This government is all about profit for business. I am not convinced that this legislation is in the public interest and that it will lead to better quality food, safer food and minimal risk to the people consuming it. It is the role of government to ensure a safe, quality supply of food to all Australians. This should in no way be compromised by cost-benefit analysis. To put costs before safety and quality is unacceptable. The quality of food we eat should be above question. I believe that the government needs to make some adjustments to this legislation. It needs to accept the amendments put to it by the opposition. If it does that, it may get this legislation through. At the centre of all our concerns is the safety of community and public health.20:30:0012418Bailey, Fran, MPMs BAILEYJT4McEwanLP10—The previous speaker, the honourable member for Shortland, raised a few important issues. She referred to food irradiation, genetically modified food and the funding of ANZFA. They are all important, but that is actually not what this legislation is about. The purpose of this legislation is to strengthen and improve the efficiency of our food regulatory system. The member has unfortunately just left the chamber. She was talking about pies without meat. I was about to suggest to her that she look at some of the absolutely wonderful food products from the magnificent electorate of McEwen. They include fresh fruit and vege tables, fresh fish, cheese, wonderful bread and, dare I say it, a whole range of pies. I assure you that they are filled with meat, chicken or whatever.I will turn to the legislation before us tonight. Unlike the previous speaker, I rise in this debate tonight with great pleasure to support the Australia New Zealand Food Authority Amendment Bill 1999 [No. 2]. I do so because food standards are of the utmost importance to every Australian producer, processor and consumer. Our reputation as an effective exporter has been built on the image that we produce food of a continually high and safe standard.Unfortunately, however, this image is often taken for granted. It is not until people return from some overseas countries or we hear stories from others who have travelled that we realise just how lucky we are in this country that we have such stringent standards applied here in Australia. I am sure many people have breathed a sigh of relief upon returning to Australia because they know that the food they consume here is indeed the safest in the world.Our reputation for safe, clean and healthy food has been established over a long time and is the envy of many of our trading partners. The assurance that our food is safe is due in large part to the standards set by the Australia New Zealand Food Authority. Established in 1991, with the passing of legislation in 1995 enabling New Zealand to be represented on the board, the authority provides a focus for the setting of food standards and food safety. ANZFA plays a key role in our food industry by developing food standards, coordinating national food surveillance and recall systems, conducting research and assessing policies about imported food and developing codes of practice within the industry. At each of those stages, I must emphasise that it widely consults with the community.The main aim of ANZFA is to ensure that there is uniformity in food standards across Australia through cooperation with the three tiers of government, industry and the community in developing a safe and wholesome food supply. The priority of the bill we are discussing here tonight is about the protection of public health and safety with the purpose of strengthening and improving the effectiveness and efficiency of the food regulatory system for both Australia and New Zealand.In February this year, I moved a private member's motion regarding our food regulatory system. The three parts of my motion were that this House, first, recognises that food is a growth industry; second, acknowledges that the food industry comprises primary industry production, processing, manufacturing, retail and catering; and, third, called on the government to ensure a national uniform food regulatory system. I emphasised then, and I will again now, that, if we are to maintain and build our domestic and international reputation, we must first acknowledge the need to simplify the regulatory mechanisms now in place.There is currently a wide mix of regulatory approaches in Australia. The problem is that they vary from agency to agency and from jurisdiction to jurisdiction. Some are mandatory, some are prescriptive and some are voluntary industry schemes. Some are in conjunction with other regulations. The list of variations just simply goes on and on. The food industry incurs costs due to duplication among regulatory agencies, the overlap of legislation and functional responsibilities, and inconsistencies and difficulty in dealing with the large number of agencies and food laws involved. For example, a single dairy plant in Victoria was required to hold 13 licences. Six related to the dairy as a food production plant and resulted in 42 inspections and audits per year at a cost of $150,000. This is just one reason why Australia needs a national uniform food regulatory system.This can be achieved through a number of major amendments to this act. The amendments include streamlining the food standard setting process of ANZFA by clarifying its role, functions and regulatory objectives. The efficiency, transparency and accountability of the authority need to be improved, as a number of recent reviews have identified these as problem areas. The food regulatory system is too fragmented. As I pointed out, it comprises a large number of agencies and legislation spread across the three tiers of government. This results in a very complex and time consuming process.There are concerns about the length of time it takes the authority to assess, and the Australia New Zealand Food Standards Council to decide on, less significant applications. The amendments will reduce this problem by providing the authority with more flexibility and efficiency in its consultation and decision making processes. This would allow the authority to assess as well as decide on less significant applications that currently need to be ratified by the Australia New Zealand Food Standards Council.The amendments will also ensure that the food regulatory system better protects public health and safety and that consumers are protected from misleading or deceptive behaviour in the sale, advertising and labelling of food. Food labelling has been a concern of mine and my constituents for a long time. I am proud that we as a government started to tackle this issue earlier this year in regard to the `Made in Australia' label. But I might say the issue is still not resolved and is still confusing for some consumers. I will use strawberry jam as an example. In any supermarket you can pick up a range of jams and each will have `Made in Australia' prominently displayed on the label. These jams pass the transformation and cost of production test, but I can assure you they are not made with Australian strawberries. It is not that manufacturers are only occasionally using imported fruit; they use it with constant regularity. It must be noted that there is sometimes a small percentage of Australian fruit but in regards to strawberry jam it is almost always imported fruit that is used. This is where it becomes misleading, as consumers would pick up a jar of Cottees, Monbulk or IXL strawberry jam and would assume when they see the label that reads `Made in Australia' that the fruit used to manufacture the jam was grown here in Australia. I believe that labels should say `Made in Australia with imported fruit'.A variety of surveys to understand the needs of consumers in relation to labelling and country of origin labelling have been undertaken over the past few years. One of the most comprehensive was a national consumer survey on food labelling by Yann Campbell Hoare Wheeler for the Australia New Zealand Food Authority. The results of this survey showed that 75 per cent of people use label information as a check that they are buying appropriate products for themselves and their families. The information they are checking is ingredients, use-by date, nutrition information and—of no surprise—country of origin. ANZFA is planning to make it mandatory to include nutritional information about the ingredients but not information about the origin of the product. I believe labels need to inform consumers whether it is a product of Australia, wholly Australian or if it is made in Australia with imported ingredients. Until there is a change to regulation P90, Australian consumers are being duped. This bill aims to ensure that adequate information relating to food is provided to consumers to enable them to make informed decisions. This is a vital part of the bill because increasing numbers of consumers want and demand information about food.One of my recent media releases to inform the people of McEwen about an initiative of the Australian Food and Grocery Council called the Food Science Bureau produced an overwhelming response from people wanting more information. The Food Science Bureau provides a one-stop shop for people wanting information and advice on food issues. It means Australians can access a range of independent, scientifically based information on food by calling an information line or jumping on the Net and going to the Internet site at www.foodsciencebureau.com.au. This response illustrated to me that people do want more information. Most of the foods we eat, including fruit and vegetables, have chemicals applied routinely. Even organic food has manure applied that can promote the growth of bacteria. People want to know and have the right to know exactly what they are consuming.The amendments to this act will progress this issue so that the Australia New Zealand Food Authority will ensure more information is readily available, which is what people need and are demanding in increasing num bers. In my electorate of McEwen, the food industry is the cornerstone of many local communities, so the issue of food standards and the way and time period in which they are determined is of extreme importance. McEwen is fortunate to have a strong and diverse food industry including grape growing and wine production, horticulture, sheep, poultry, beef, dairy industry and aquaculture. Any measures to streamline the operations of the authority, decrease the time taken for applications to be reviewed and simplify procedures will have a direct benefit for industries, and especially those industries in my electorate of McEwen.Australia has a reputation of having one of the highest standards of food safety in the world. Many food processors, like those in my electorate of McEwen, depend on this reputation for their livelihoods. Through this bill, our government's commitment to reforming and protecting this reputation is being strengthened. The proposed amendments to the act will ensure uniform food standards around Australia and the continuation of a high level of food safety, providing an increasing level of certainty and security. I commend this bill to the House.20:43:0012421O'Connor, Gavan, MPMr O'CONNORWU5CorioALP00—The Australia New Zealand Food Authority Amendment Bill 1999 [No. 2] is a very important piece of legislation as far as my own portfolio interest is concerned because it relates to the regulatory framework designed to ensure the safety of food, a major output of Australia's agricultural sector. This legislation we are debating here today amends the Australia New Zealand Food Authority Act 1991 and emanates from a number of reviews relating to food regulation, namely the review of the above act against national competition policy principles, the Review of State and Territory Food Acts and the food safety review.It is fair to say that the present food regulatory system in Australia is both complex and fragmented, involving local, state and federal governments in the regulatory task. Governments at the federal level over a long period of time have been actively involved in the process of rationalising the food regulatory framework to reduce, where appropriate, the cost burdens on the food industry and ultimately the price of food to consumers and to develop more transparent and accountable regulatory procedures to protect public health and consumers of food products. The bill we are debating here today is part of that evolving process of developing food regulations that strike an appropriate balance between the public health needs of the consuming public and the economic costs associated with the maintenance of food standards.As we know, food is one of mankind's primary needs. The regrettable reality is that globally there is a gross imbalance in the distribution of food. Millions of people go hungry each day in many underdeveloped countries. Even as the sun sets today on the important debates conducted in this House, thousands will have died through lack of food or from diseases directly related to an inadequate diet. In the developed Western world of which we are a part, we do enjoy the luxury of these debates on the regulation of food standards and issues of food safety. I do not underscore the importance of these debates to us, but we should always keep them in perspective against the reality of food scarcity and the poverty endured by millions as we speak. Wars have been fought over it. The production and preparation of food has formed the core of cultural rituals and religious beliefs since mankind's early beginnings.Australia is in the enviable position of producing more food than it consumes. This nation has become an important supplier of staple and exotic foods to global markets. The gross value of farm production in 1997-98 was of the order of $27.5 billion. That includes both crops and livestock production. In that year the value of farm exports in both livestock and crops totalled around $22.5 billion. Employment in agriculture in 1997-98 was of the order of 387,000 people. The production and distribution of food products and the servicing of farm production form the backbone of many regional and rural economies. So farmers have a deep and abiding interest in matters relating to the safety of the food chain, for their ultimate livelihood rests on consumers having real confidence in the safety of the food they eat.Recent history is dotted with examples of where the food regulatory system, for whatever reason, has broken down and farmers have paid a very heavy price for the fact that consumers have lost confidence in the safety of a food product. For example, meat substitution scandals wrecked our export trade in certain meat products. It took the industry years to recover the confidence of international consumers and to restore confidence in those very lucrative and important markets to Australian producers. More recently, contamination in the food chain has led to death and injury here at home to the ultimate detriment of producers and those employed in the processing of food products.Just in case anyone in this chamber is in any doubt whatsoever about the economic importance of the value adding part of the food chain, a cursory reflection on the statistics clearly demonstrates its importance. The processed food and beverage industry is the second largest manufacturing sector. It generates employment of the order of 157,000 people and exports some $9 billion worth of product. So it is in the interests of farmers in the long term to have a regulatory regime in place that is cost effective and that ensures consumers are able to purchase a diverse range of fresh and processed food with a high degree of confidence.Consumers are demanding that the food products they consume are free from contamination and that high quality standards are being applied at the point of production and also in the value adding and retail parts of the food chain. The farming community has responded positively to these demands. It is also fair to say that, over the past two decades, we have seen a virtual revolution in attitudes to quality production and a massive increase in the skills required by farmers to grow food for an increasingly sophisticated consumer driven market. The farming sector is much more highly skilled today than it was in the use of chemicals in agricultural production. Land use patterns have changed to assist in reducing chemical use.Massive strides have also been made in improving the packaging and transportation of fresh food to reduce the risk of contamination to consumers and to bring quality produce to the marketplace. Indeed throughout the whole food marketing chain there is now a necessary commitment to quality to ensure that viable economic returns are sustained over time to the farming sector. That brings me to the important part played by food regulation in this whole process.In Australia, the Australia New Zealand Food Authority makes recommendations on food standards to the Australia New Zealand Food Standards Council, which comprises the health ministers from the Commonwealth, the states and the territories and from New Zealand. The objectives for those food standards are set out very clearly in the ANZFA Act of 1991. They are the protection of public health and safety, the provision of adequate information relating to food to enable consumers to make informed choices and to prevent fraud and deception, the promotion of fair trading in food, the promotion of trade and commerce in the food industry, and the promotion of consistency between domestic and international food standards when they are at variance.These are not easy objectives to achieve, even by themselves. They are even more difficult when the pursuit of one may bring conflict with another. ANZFA does have a difficult task at times in reconciling objectives and achieving a reasonable and appropriate balance of interest in ensuring that public health and safety requirements are met, yet at the same time making sure that the regulatory burden does not impose inordinate costs or unduly restrict competition in the marketplace.The current task has not been assisted by the disparate systems of food regulation that evolved historically around state based regulatory frameworks. Achieving a full integration of local and state based regulatory systems and better coordination in the task has been, and still is, a very difficult undertaking. The legislation we are debating in this House at the moment will form an important part of that evolutionary process, which has been under way since our early colonial days when the colony of New South Wales passed the Adulteration of Bread Act 1838. In the words of a recent pop song by, I think, Bruce Hornsby, `That's just the way it is. Some things just never change.'At this point in the debate, I do not wish to canvass all the elements of the amended bill being proposed by the government. Important points have been eloquently articulated by my colleague the member for Bruce, the parliamentary secretary to the shadow minister for health. However, I would like to highlight a couple of important issues raised in this legislation which I think are worthy of close scrutiny, broad discussion and deep consideration. The first relates to the issue of legally enforceable standards versus non-enforceable codes of practice and the role of preventative measures and reactive remedies. I note the concerns expressed by witnesses to the Senate inquiry into this legislation; namely, that it will encourage food standards to be replaced by less enforceable codes of practice.I also note the minority report of my Senate colleagues in that inquiry—notably, my shadow parliamentary secretary in the agriculture portfolio, Senator Forshaw, who has been intimately involved with this issue over a long period of time. That minority report concluded that codes of practice definitely have a constructive role to play but that they should not be a substitute for food standards. The minority report indicates ANZFA's acknowledgment that this is not the intention—and I am pleased to note that here in this debate. I urge the government to re-examine the recommendations of the minority report in this regard, which reflect the obvious concerns of many witnesses at the inquiry on this particular issue of codes of practice and food standards.The second issue relates to the objective of promoting trade and commerce in food and also the promotion of consistent international food standards—which is commonly identified in the debate as the issue of harmonisation of standards. These are important objectives as governments at state and federal levels of all political persuasions agree that Australia's export growth and the ongoing economic development of many regions is heavily linked to our ability to access over seas markets and to reduce protective barriers to the importation of Australian food in many countries.Australia exports over 80 per cent of its agricultural production, so the sector's long-term survival depends heavily on the gains we are able to make in the forthcoming millennium WTO round. It should be appreciated that the principle of harmonisation was never predicated on the requirement that countries with accepted high food standards should be in the business of lowering them to the minimum acceptable standards existing in countries with less developed regulatory regimes.This point was also made eloquently by my colleagues the members for Bruce and Oxley in their contributions to this debate in canvassing the international marketing advantage that Australian food enjoys in a global marketplace where inferior quality food can easily be accessed by consumers but where the Australian product is demanded simply because of its quality and the security offered by high standards in the Australian food chain. The government ought not compromise this position, either in this legislation or in the WTO negotiations.Food safety and quality assurance formed an important part of the policy on agriculture that Labor took to the last election. I acknowledge in this debate the contribution of my predecessor, Neil O'Keefe, the member for Burke, in this regard. He articulated on many occasions that Australian food producers must be able to satisfy the consumers' need for reassurance on matters of food safety and quality. To that end, Labor is committed to establishing and enforcing a national model of food safety and quality assurance. Our record in government over 13 years is testament to the commitment we have to the issue of food safety.This is a very important piece of legislation. I commend the contributions that have been made by the many members who have contributed to the debate thus far. I understand that the government is seriously considering the amendments that have been put by the opposition to improve this legislation and to reflect some of the community concerns that have been put not only in the public arena but in the processes of this parliament through the Senate inquiry into this piece of legislation.I seriously commend to the government the recommendations that were made in the minority report that was presented at the conclusion of that inquiry. Those recommendations were not made to score points off the government; they were made in the interests of improving this piece of legislation because there is widespread concern among not only the consuming public but also primary producers that the security of the food chain is maintained by an appropriate regulatory framework that gives confidence to consumers of food products.As I said in the remarks I made in my speech, farmers have a deep and abiding interest in this legislation, because the products they produce are consumed not only domestically but also internationally. Australia does have a very high reputation. Australian producers have a very high reputation for producing safe and high quality food, and it is very important that regulatory frameworks protect the security of the food chain and give confidence to consumers so that producers themselves can have confidence that the products they produce will continue to find favour in both domestic and international markets.21:00:0012424Elson, Kay, MPMrs ELSON6K6FordeLP10—It is a pleasure to speak to this Australia New Zealand Food Authority Amendment Bill 1999 [No. 2], as this bill is all about creating a more effective system of food standards and regulations to safeguard the interests of the Australian public. It does so by a series of amendments to the original act which created the Australia New Zealand Food Authority in 1991. The original act was put in place with the aim of creating a uniform national and binational approach in order to ensure the safety of our food supply and the huge task of overcoming differences in regulations between all states and our two countries. However, it should be remembered that, while the act created a new national body, the Australia New Zealand Food Authority, that body has had to act in cooperation with Commonwealth, New Zealand, state and territory governments to achieve its objectives—with the state and territory governments having ultimate responsibility for the enforcement of food regulations and the standard set by the authority.The authority has had a massive task and, along with the development of a uniform food products standard, it has developed a set of national food safety laws that will apply for the first time across Australia. It should be recognised that the ongoing task of ANZFA becomes tougher and more complicated given the place of technology changes in our industry. Issues like genetically modified food, which have been debated publicly only very recently, and which I will discuss later, present new challenges for any regulatory body. This bill delivers necessary amendments to allow the authority to more effectively protect public health and safety, to have clearly stated objectives and to have more flexibility and efficiency in its consultation and decision making processes.Like all areas of government policy, our food regulation standards must reflect community expectations while at the same time ensuring that we do not impose undue cost on the food industry and consumers. It is an important balancing act, even though Labor may choose to politicise this debate. And let's face it, they seem to do that on every issue. We never hear anything constructive from them, just negative carping and constant opposition or scare tactics like we heard from the member for Shortland previously. The government is making sure we act in Australia's best interest, and that means finding the right balance. It means making sure that consumer safety and health concerns can be thoroughly met while at the same time ensuring that industry and business is not bogged down in unnecessary and costly red tape.The bottom line is that, if we impose a very costly regulation process, the cost is passed to the consumer in the form of higher prices. Labor might like to ignore that fact; they have definitely lost touch with the battlers in middle Australia if they do. In my electorate of Forde, 34 per cent of people are on weekly incomes of less than $500 and any undue increase in the price of groceries will really impact on them. I certainly do not want to see that happen just for the sake of creating another monstrous bureaucracy and an excessive regulatory system.As I said, the key is finding the right balance. I am certainly not suggesting that consumer safety be compromised in any way. This government is determined to provide a better quality of life for all Australians. Naturally, when we talk about quality of life, health and wellbeing play a very large part. These days we are much more aware of the nutritional value of the food we eat than we were when I was growing up. Most of us cringe at the thought of lard now, but it was almost an essential ingredient in most cooking 30 years ago. The chief of CSIRO Human Nutrition, Professor Richard Head, reports:Consumers increasingly want to eat for health, and more people will select foods that are good for their heart and circulation, lower the risk of cancer, diabetes and other degenerative disorders.Higher consumer awareness has meant that comprehensive labelling, including dietary information, has become commonplace in most food items. Increasingly, for many consumers it is almost second nature to check product labels to find the fat content, kilojoules, additives and so on in a product before we buy it.I was very interested to read, while I was researching this speech, about the CSIRO's project Cassandra—a forecast about where our diet and food supply is heading towards 2010. It predicts that shoppers will actually have a personal scanner where we will scan a bar code on food labels to help us select a diet that meets our own personal needs, eating preferences and avoids allergies. We will have shopping trolleys that will be smart enough to not only tally our grocery bill but also assess the nutritional qualities of the food we buy. This glimpse into the future by the CSIRO is an indication of just how fast moving and challenging the future of the food industry is. It also indicates the need for a regulatory system that is flexible and responsive enough to keep pace with the change.Australia's food industry is worth around $64 billion each year. It provides hundreds of thousands of jobs for Australians and is a very large part of our export market. It is interesting to note that Australian food standards were developed more than 20 years ago when obviously our food supply was vastly different. Since then, the system has developed in a very piecemeal way. In a recent address, the Managing Director of the Australia New Zealand Food Authority, Mr Ian Lindenmayer, summed up the need for new standards that are currently being finalised by the authority. He explained:Given the enormous range of foods available today, it just isn't practical to have a separate legal standard for every single food on the market. Moreover, we are seeing new types of food becoming available every month in our supermarkets. It isn't practical or sensible any longer for regulation to be based primarily on individual foods. If we did this, apart from the enormous cost to the taxpayer, we would end up with such a large body of laws that it would be impossible to police.The standards need to be streamlined so food inspectors have more time to concentrate on major food safety issues rather than having to enforce unnecessarily prescriptive and out-of-date food standards. Wherever possible, regulations for individual foods are being replaced by broad-ranging provisions that are consistent across all foods or a range of foods. Generic safety standards will apply to all foods, and labelling standards will set out the type of information that must be provided to consumers. Other generic standards will include the regulation of food additives, processing aids, microbiological standards, contaminants and residues.This legislation will give the food authority greater flexibility, especially when matters are considered insignificant and of minor public interest. But ANZFA will remain accountable to state and territory as well as federal governments through the Australia and New Zealand Food Standards Council, which is made up of all federal, state and territory health ministers of Australia and New Zealand. Just as we saw recently with the case of ANZFA's recommendations regarding the labelling of genetically modified food, the council will have the power to reject an authority recommendation if it does not believe that it properly reflects community expectations.Genetically modified food is an issue that has attracted a lot of negative press, and it is understandable that the public is concerned to know more about the process and exactly what it means for the quality of their food. Biotechnology, as it is also known, has the potential to create foods that are actually safer, healthier and better balanced from a nutritional standpoint: for example, produce that can withstand diseases and pests without the use of chemical pesticides and all the health problems they may present or produce developed to contain higher quantities of probiotics, phytochemicals, fibre, resistant starches and other products that can help an ageing population live longer in good health.Of course, just as there are exciting positive possibilities, there are also very many unknown and unexplored risks: for instance, the creation of new allergens or transference of known allergens from traditional foods to genetically modified variants. The Australian Consumer Association's Choice magazine quotes an instance where a gene from the brazil nut was introduced into soya bean. It turned out that people who were allergic to brazil nuts were also allergic to the new genetically modified soya bean. Choice also points out that using genes from animals in plant foods, and even genes from humans in some cases, poses ethical and religious problems for many people. It is the unknown qualities of genetically modified food which make the decision of the health ministers to require mandatory labelling of all genetically modified foods the right one.Australia needs to look very closely at worldwide public sentiment on this issue and carefully decide where we should head in the future. It was interesting that Choice magazine had listed two very contrasting quotes that I thought summed up the options open to our local food industry. One was that the New South Wales Grains Board had sold the largest ever cargo of canola to leave Australia, bound for oilseed crushing plants in Europe. The board's managing director, Graham Lawrence, was quoted as saying:Europe has moved to become a major buyer this year because Australia is the only country to guarantee non-genetic modified canola. On the other hand, Brendan Stewart of the National Farmers Federation was quoted recently as saying:It is unrealistic—and potentially economically unwise—for Australia to develop a `fortress Australia' approach to agricultural biotechnology. The rest of the world is adopting and will continue to adopt biotechnology in agriculture. Are we going to forgo our many natural advantages and become an agricultural also-ran, simply because of a conservative backlash against progress?Clearly the jury is still out on the issue of genetically modified foods, but I personally believe that we ought to have comprehensive labelling to allow the greatest degree of consumer knowledge and choice on this issue.As I said at the beginning, this bill clearly sets out objectives for ANZFA in developing food regulatory measures. Those objectives are the protection of public health and safety and the prevention of misleading or deceptive behaviour. The Australian public have the right to expect that, and in supporting this bill I also congratulate ANZFA on their work to date in developing both new food standards and new food safety regulations. At the same time I remind them of their obligation that these regulatory measures do not become a huge financial burden on our producers and manufacturers.I would like to finish on a positive note. I was pleased to read the results of ANZFA's 1996 Australian market basket survey, which covers the period from 1996 to 1998 and assesses a comprehensive range of ready to consume foods to determine levels of pesticide residues and contaminants they may contain. This survey found that Australian food supplies are amongst the safest in the world and that the level of pesticide residues and contaminants in our food is well within the safety standards set by health authorities both here and overseas. It is reassuring for all of us, who naturally want the best for our families, to know that our food is safe. This legislation will help ensure that ANZFA can better meet its objectives regarding consumer safety and health and also provide an efficient, workable regulatory framework to ensure the future of our successful multibillion dollar Australian food industry. I commend the bill to the House.21:14:0012427Wooldridge, Dr Michael, MPDr WOOLDRIDGE8E4ChisholmLPHealth and Aged Care10—I thank honourable members for their contributions to this debate. The Australia New Zealand Food Authority Amendment Bill 1999 [No. 2] proposes four major areas of amendment: it creates objectives for the act and clarifies the role, functions and regulatory objectives of the Australia New Zealand Food Authority; it provides the authority with more flexibility and efficiency in its consultation and decision making processes; it enables the authority to more effectively protect public health and safety and the prevention of misleading and deceptive behaviour; and it allows the authority to charge for services in certain circumstances.In addition the bill will enable the implementation of sweeping reforms to food safety as the first phase in improving the consistency of food related legislation across Australia. The Australia New Zealand Food Authority will still be required to consult appropriately with all stakeholders, including consumers, and greater consumer information about foods will be provided through the use of the most appropriate public information mechanisms. The bill will also provide industry with a more efficient assessment system through enabling ANZFA to move more quickly to process routine standard matters. This will facilitate industry innovation and make Australia and New Zealand industry more competitive.Finally, the bill will benefit all stakeholders by ensuring that government appropriated money is used primarily for public health and safety protection and for the protection of consumers while ensuring that applications of direct financial benefit or urgency to industry are assessed in a timely manner. A view was put by some community groups during the Senate committee hearing on the bill that the charging and refund proposal within the act should be subject to greater transparency. It is certainly the government's intention for these functions to be transparent and for ANZFA to be fully accountable. To this end ANZFA will further consult with key stakeholder groups in developing the necessary regulations. I note the opposition has fore shadowed a number of amendments that broadly complement the government's policy intent. I thank the opposition for their constructive approach to this and therefore will be pleased to support them.Question resolved in the affirmative.Bill read a second time.12427Bill—by leave—taken as a whole.21:16:0012427Griffin, Alan, MPMr GRIFFINVU5BruceALP00—by leave—I move opposition amendments Nos 1 to 19:(1) Schedule 1, item 2, page 3 (lines 7 to 24), omit the item, substitute:2 After section 2 Insert:2A Object of Act The object of this Act is to ensure a high standard of public health protection throughout Australia and New Zealand by means of the establishment and operation of a joint Food Authority to achieve the following goals: (a) a high degree of consumer confidence in the quality and safety of food produced, processed, sold or exported from Australia and New Zealand; (b) an effective, transparent and accountable regulatory framework within which the food industry can work efficiently; (c) the provision of adequate information relating to food to enable consumers to make informed choices; (d) the establishment of common rules for both countries and the promotion of consistency between domestic and international food regulatory measures without reducing the safeguards applying to public health and consumer protection.(2) Schedule 1, item 9, page 5 (after line 25), after paragraph (c), insert: (ca) to promote consistency between standards in Australia and New Zealand with those used internationally, based on the best available scientific evidence; and(3) Schedule 1, item 16, page 8 (line 13) to page 9 (line 2), omit the item, substitute:16 Section 10 Repeal the section, substitute: 10 Objectives of the Authority in developing food regulatory measures and variations of food regulatory measures (1) The objectives (in descending priority order) of the Authority in developing food regulatory measures and variations of food regulatory measures are: (a) the protection of public health and safety; and (b) the provision of adequate information relating to food to enable consumers to make informed choices; and (c) the prevention of misleading or deceptive conduct. (2) In developing food regulatory measures and variations of food regulatory measures, the Authority must also have regard to the following: (a) the need for standards to be based on risk analysis using the best available scientific evidence; (b) the promotion of consistency between domestic and international food standards; (c) the desirability of an efficient and internationally competitive food industry; (d) the promotion of fair trading in food.(4) Schedule 1, page 9 (after line 2), after item 16, insert:16A After Section 10 Insert:10A Authority to develop three year plan (1) Not later than 30 June in each year, the Authority must develop and publish a three year forward plan for applications, proposals and types of applications and proposals on which it intends to develop standards or variations to standards. (2) In developing a three year forward plan, the Authority must consult interested persons.(5) Schedule 1, item 20, page 9 (lines 16 to 22), omit paragraph 2 (c), substitute: (c) be accompanied by an application fee being the sum of (i) the charge (if any) fixed under section 66 in relation to the making of the preliminary assessment of the application; and (ii) the charge (if any) fixed under section 66 in relation to the giving of notices under section 14 in relation to the application. (6) Schedule 1, item 22, page 10 (lines 23 to 28), omit subsection 12B(1), substitute:(1) If (a) an application has been accepted by the Authority under section 13A and the applicant has paid to the Authority a charge mentioned in subsection (2) in relation to the application; and (b) the application is withdrawn under section 12A; the Authority must refund so much of the charge as is equivalent to the sum not expended from the charge as is calculated in accordance with the regulations.(7) Schedule 1, item 22, page 10 (lines 31 to 32), omit paragraph 2(a).(8) Schedule 1, item 22, page 10 (lines 33 to 34), omit paragraph 2(b)(9) Schedule 1, item 22, page 11 (lines 25 to 28), omit paragraph 2(c), substitute: (c) whether costs that would arise from a food regulatory measure developed or varied as a result of the application outweigh the direct and indirect benefits to the community, Government or industry that would arise from the measure or variation.(10) Schedule 1, item 22, page 12 (line 32), at the end of paragraph (1)(a), add: "by public announcement and dissemination in a form the Authority considers will be effective in alerting interested parties to the proposal and which will make the details of the proposal generally accessible".(11) Schedule 1, item 22, page 15 (line 28), at the end of paragraph 5(b), add: ; and (iii) the public by announcement and dissemination in a form the Authority considers will be effective in alerting interested parties to the proposal and which will make the details of the proposal generally accessible.(12) Schedule 1, item 22, page 16 (line 17), at the end of subsection 17(2), add: ; and (d) the public by announcement and dissemination in a form the Authority considers will be effective in alerting interested parties to the proposal and which will make the details of the proposal generally accessible.(13) Schedule 1, item 24, page 18 (line 14), at the end of subsection (1), add: ; and (e) the public by announcement and dissemination in a form the Authority considers will be effective in alerting interested parties to the proposal and which will make the details of the proposal generally accessible.(14) Schedule 1, item 25, page 19 (line 2), at the end of subsection 20A(1) add: and (c) the Authority has not received any substantive objections to the proposed standard from submissions, including submissions made by consumer or public health bodies.(15) Schedule 1, item 29, page 21 (line 29) to page 22 (line 13), omit the item.(16) Schedule 1, item 34, page 25 (line 11), at the end of subsection 28A(1), add: and (c) the Authority has not received any substantive objections to the proposed standard from submissions, including submissions made by consumer or public health bodies.(17) Schedule 1, item 44, page 29 (lines 9 to 16), omit the item, substitute: (1) Subject to subsection (1A), if the Authority prepares a draft standard or a draft variation of a standard, it must make a recommendation to the Council concerning that draft standard or variation within 12 months or such shorter period as may be prescribed after the receipt of the application that gave rise to that draft standard or variation.(18) Schedule 1, item 44, page 29 (after line 16), after subsection 1, insert: (1A) In the case of a draft standard or draft variation of a standard arising from an application considered in year 2 or 3 of the Authority's work plan, the Authority must make a recommendation to the Council concerning that draft standard or draft variation of a standard within 12 months of the beginning of the work plan year in which the application was considered.(19) Schedule 1, item 63, page 34 (line 4), at the end of section 66, add: (6) A charge may only be fixed where: (a) in relation to the development or variation of a food standard, the development or variation of that food standard would confer an exclusive, capturable commercial benefit on the person or body that made the application; or (b) an application has been included in the second or third year of a three year plan and the applicant elects to have the application included in the first year of the work plan. (7) Development of, or variation to, a food standard for which a charge is fixed under this section must not displace the development of, or variation to, any other food regulatory measure in a three year plan. (8) The processing of an application under subsection (6) must not displace the development of, or variation to, any other food regulatory measure in a three year plan. (9) For the purpose of subsection (6) an exclusive, capturable commercial benefit applies where: (a) the applicant can be identified as a person or body that may derive a financial gain from the adoption of the draft standard or draft variation of the standard that would be prepared in relation to the application; and (b) any other unrelated persons or bodies, including unrelated commercial entities, would require the agreement of the applicant in order to benefit financially from the approval of the application. (10) For the purposes of subsections 6,7 and 8, a three year plan means a three year forward plan of the Authority developed under section 10A.I understand the amendments that I have just moved have been through lengthy negotiation and consideration—for which I would like to thank the government and ANZFA officials for their assistance—so that we do have in fact agreement on a range of these points. I will take a few minutes to go through some of those amendments but, before I do that, I would like to make a couple of comments about aspects of the debate that has ensued on the second reading. Certainly there has been a range of contributions from both sides of the House on this area, which shows that there are grave concerns about the whole issue of food regulation in Australia. However, I think it is fair to say that some of the emphasis in the debate has been on other wider issues which this bill, to an extent, does relate to in that it sets up parts of the overall regulatory framework for food regulation. But in fact that has led to a debate which, while informative to many, has focused on some issues more than it probably should have.I would like to take up a couple of comments on this particular bill made by some of the speakers that I heard. The member for Blair commented on a single line regarding the question of sausage sizzles in the 30-minute speech that I made on this bill. That was a by-the-by comment about the general sorts of concerns that have been raised in the food regulatory sector in recent times but it seemed to be a major concern to the member for Blair. I can only apologise to him: I did not want to get him that upset about what was just one line in a speech. But it certainly managed to keep him going for about three or four minutes in a speech of less than 20 minutes, so obviously he thought it was very important. He made a number of other points which I think showed a lack of understanding of aspects of the bill and of the contribution by the opposition to this and certainly showed a lack of understanding of the basis of the Senate minority report on this particular legislation. I will probably have a quiet word to him about those issues and hopefully set him straight, but I will not do it here tonight in the House.One of the particular amendments that we have before us now establishes new objectives for the act. Labor's amendments create a new set of objectives for the act in a new section 2A. In contrast to the government's initial proposal for this section which provided for `equivalent public health protection', Labor's amendments focus on a priority for consumer confidence in the quality and safety of food produced, processed, sold or exported from Australia and New Zealand. Labor's amendments to the bill also make transparency and accountability in the regulatory framework of the food industry an objective of the legislation. Labor hopes that the government will now move to adopt our proposed objectives for the act to promote public health and safety ahead of the commercial considerations which are a feature of the bill as it currently stands.There is an amendment to alter the functions of the authority. Labor's amendment requires that, as one of its functions, ANZFA must promote consistency between the stand ards of Australia and New Zealand and those used internationally on the basis of the best available scientific evidence. There has been some conjecture about the use of the terms `best' and `sound' interchangeably in relation to the nature of the evidence used by ANZFA in assessing food standards. Best available scientific data is the threshold proposed by the Blair review in recommendation 25(2)(b) and is based on the maintenance of a higher standard in public health protection. Our amendment is consistent with this.Another amendment concerns the establishment of objectives in the setting of food standards in contrast to the objectives for the act. In particular, it creates an additional objective which requires the authority to provide consumers with information which would enable them to make more informed choices. In the bill as it stands, this is merely a matter which ANZFA must consider rather than being an objective. Again, the government has proposed the use of the word `sound' rather than `best'. We believe our wording is in fact better and I am happy to see that the government is prepared to accept it.Another amendment moves to create a three-year work plan for ANZFA. The bill contains a proposal which was revived from a 1996 bill that lapsed in 1998 to establish an annual work program for ANZFA. Having listened to organisations such as the Australian Food and Grocery Council, we are moving this amendment to allow the establishment of a three-year work plan for categories of food on which it is proposed to develop standards. This should give more certainty to stakeholders, ANZFA and the government when funding the authority as to what will be happening when. (Extension of time granted) It also provides ANZFA with an ability to improve its resource management capacity so as to carry out its functions more efficiently. Another amendment is to include provision for an application fee. Labor's amendment includes a requirement that an application fee be set by ANZFA and that this provision be included in the act. This means that the determination of charges will not be left solely to regulation. The alternative—keeping these matters in regulations alone—will result in less parliamentary control over the formulation and adoption of regulations.Another amendment concerns the requirement to refund charges if an application is withdrawn. The bill as it stands would simply leave this to the regulations and to be determined chiefly by the authority. Labor's amendment fixes a more specific formula for the refund of fees: the authority must refund the sum not expended from the charge calculated by reference to the regulations. Importantly, this requires the authority to track its expenditure more regularly than it would otherwise need to under the provisions of the bill as it stands. Again, this allows for greater parliamentary control over the fixing and refunding of charges.Very briefly on that particular issue, it was agreed by the government and the opposition that on this particular matter there was a need for transparency. We are very keen to ensure that there is also consultation on the regulations that relate to this particular section of the act. It is my understanding that the government has agreed to that, and we certainly look forward to the opportunity to take part in that process down the track. I am hoping that the minister will reiterate that in his final comments. We think that is a very important aspect of what needs to be done in this particular area. Although I think the intention of the government with respect to this section is very similar to the intention of the opposition, we do believe that the wording as it currently stands leaves some openings there which are unnecessary in the circumstances.Another amendment concerns the notification requirements in the preliminary assessment of applications by ANZFA. Labor's amendments require that ANZFA give notice by public announcement and by the dissemination of information to interested parties of applications or proposals for the development or variation of a food regulatory measure. This creates a greater capacity for the input of consumers and health professionals into the process of food regulation development.Another amendment concerns the notification requirements where an inquiry is held by ANZFA to consider a draft standard. Where ANZFA holds an inquiry to consider a draft standard or a draft variation of a standard, it must also give notice by way of public announcement. As the bill stands, the only persons who must be given written notice under proposed section 19 are the applicant, appropriate government agencies and persons who made a submission in relation to the proposal or application. They are parties who have an already demonstrated interest in the process.Labor, through these amendments, hopes to ensure that ANZFA remains accountable and open to public scrutiny. It is important—particularly for those public health and consumer organisations which are not sufficiently resourced to be able to make regular formal submissions to ANZFA about the development of food regulations—that ANZFA makes information about its assessment of food regulations broadly available to the public.Another amendment concerns the considerations which ANZFA must account for when deciding whether to refer a decision about a less significant application or proposal to the Australia New Zealand Food Standards Council. Labor's amendment requires that the authority take into consideration the receipt of any submissions, including those by consumer and public health bodies which raise substantive objections to a proposed standard. This ensures greater participation and input into the development of food regulatory measures.The other amendment is to retain existing provisions of section 23(2) of the act, which concerns the making of a full assessment of a proposal by ANZFA. This will keep the existing proposal assessment process under section 23(2) of the act. This is in contrast to the bill as it currently stands, which proposes to include a cost-benefit analysis of proposals and requires that ANZFA consider whether there are more cost-effective alternatives to the proposal. This is in conflict with the priority of public health and safety protection.We think the bill as amended will lead to a superior act than what was originally proposed and, in those circumstances, it is deserving of the support of the House. The actions that have been taken by the opposition have been designed to improve clarity and transparency. (Extension of time granted) In winding up, we think that the bill, as it will stand after the amendments, will lead to a superior act. We do, though, reiterate our earlier concerns about the need for an overall consideration of this system. We certainly are concerned about taking action at this stage while we are still in the situation of having been waiting some 12 months for a full response to the Blair review. That certainly needs to happen and we have been led to believe it will happen next month. We look forward to it happening because we think that consideration of piecemeal changes to this regulatory system, when a major review is under active consideration by the government, needs to be done in the context of that review.I suspect that we will again be before this House in the foreseeable future with further legislation leading to further change in this area. We await that and we certainly want to ensure that changes with respect to this particular area are properly reviewed by parliament and by the opposition. We are also very firmly of the view that this entire area of food regulation needs to be considered in a holistic fashion. When the response to the Blair review is handed down, we look forward to seeing what the government proposes and to scrutinising and responding to that.I will finish with two very small points. I mentioned earlier in my contribution the issue of regulations in relation to the whole area of charges. There needs to be consultation with respect to the calculations around the question of refunds of charges. I put on the record very clearly that, as an opposition, we view the preliminary assessment charges and the full assessment charges as the only charges that ought to be authorised under this legislation by ANZFA. On the basis of agreement being reached, I commend the amendments to the House and look forward to the bill passing through the other place.Amendments agreed to.Bill, as amended, agreed to.12432Bill (on motion by Dr Wooldridge)—by leave—read a third time.Bills12432r75012432Consideration resumed from 19 October.Senate's amendments—(1) Clause 2, page 2 (after line 13), at the end of the clause, add:(6) Item 1 of Schedule 4 is taken to have commenced on the same day as item 44 of Schedule 1 to the Health Insurance Amendment (Professional Services Review) Act 1999 , immediately after the commencement of that last-mentioned item.(2) Schedule 1, page 14 (after line 19), after item 26, insert:26A Subsection 78(3)Omit "or (2)", substitute ", (2) or (7)".26B At the end of section 78Add:(7) After receiving notification from the Secretary that the Minister has not made a declaration under subsection (4) in relation to a notification by an organisation, a registered organisation must take all reasonable steps to notify each affected contributor, explaining (in plain English) the change before the change takes effect.(3) Schedule 1, page 14 (after line 19), after item 26, insert:26C At the end of section 78Add:(8) The Minister must cause a report of changes in the rates of contribution by contributors of registered organisations to be laid before each House of the Parliament within 15 sitting days after the end of a quarter.(9) The report shall relate only to changes in rates of contribution by contributors: (a) that have been notified by the registered organisation to the Secretary in accordance with subsection (1); and (b) in respect of which the Minister has not made a declaration under subsection (4).(10) If, during any quarter, there has been no notification by a registered organisation of a change relating to rates of contribution by contributors, to which paragraphs (9)(a) and (b) apply, there is no requirement for a report under subsection (8) to be provided to the Minister in respect of that quarter.(11) In this section: quarter means a period of 3 months beginning on 1 January, 1 April, 1 July or 1 October of any year.(4) Schedule 1, page 18 (after line 29), after item 47, insert:47A Saving provision pending establishment of new prudential standards(1) In this item: new prudential standards day has the same meaning as in subsection 4(1) of the Principal Act as amended by this Act. Principal Act means the National Health Act 1953 .(2) Despite the insertion of paragraph 72A(ca) of the Principal Act by item 11, the Principal Act continues to have effect until the new prudential standards day as if that insertion had not been made.Note: The heading to item 48 is altered by omitting "Saving " and substituting "Other saving ".(5) Schedule 2, page 21 (after line 5), before item 1, insert:1A Subsection 4(1)Insert: new prudential standards day means the day on which the Council establishes: (a) a solvency standard for the purposes of Division 3A of Part VI of this Act; and (b) a capital adequacy standard for the purposes of Division 3B of that Part.(6) Schedule 2, item 3, page 23 (line 4), omit "is to establish", substitute "must, as soon as practicable but, in any case, not later than 1 January 2001, establish".(7) Schedule 2, item 3, page 23 (after line 14), after subsection (3), insert:(3A) If, in establishing a standard, the Council decides: (a) not to adopt advice concerning a standard from the Australian Government Actuary; or (b) to adopt advice concerning a standard from the Australian Government Actuary with variations;the Council must publish in the Gazette a statement that sets out the Council's reasons for not adopting, or for varying, that advice.(8) Schedule 2, item 3, page 26 (line 25), omit "is to establish", substitute "must, on the same day as it establishes a solvency standard under section 73BCB, establish".(9) Schedule 2, page 30 (after line 10), after item 4, insert:4A After section 82BInsert:82BA Purposes of Council(1) The Council is established for the following purposes: (a) to regulate registered organisations in accordance with this Act, other laws of the Commonwealth and any directions given by the Minister; (b) to develop policies about the performance of its regulatory functions.(2) In carrying out its purposes, the Council must take all reasonable steps to achieve an appropriate balance between the following objectives: (a) the objective of fostering an efficient and competitive health insurance industry; (b) the objective of protecting the interests of consumers; (c) the objective of minimising the level of health insurance premiums; (d) the objective of ensuring the prudential safety of individual registered organisations.(10) Schedule 2, page 30 (after line 10), after item 4, insert:4B At the end of section 82DAdd:(4) A person cannot be appointed as a member of the Council if that person is a director, officer or employee of a body regulated by the Council.(11) Schedule 2, item 43, page 41 (line 20), before "there", insert "on or after the new prudential standards day".(12) Schedule 2, item 43, page 41 (line 22), before "there", insert "on or after the new prudential standards day".(13) Schedule 2, item 43, page 42 (line 19), after "section 73BE or", insert ", on or after the new prudential standards day,".(14) Schedule 2, item 43, page 81 (line 20), before "there", insert "on or after the new prudential standards day".(15) Schedule 2, item 43, page 81 (line 22), before "there", insert "on or after the new prudential standards day". (16) Schedule 2, item 43, page 82 (line 19), after "section 73BE or", insert ", on or after the new prudential standards day,".(17) Schedule 2, page 97 (after line 35), after item 47, insert:47A Saving provisions relating to new prudential standards(1) In this item: new prudential standards day has the same meaning as in subsection 4(1) of the Principal Act as amended by this Act. Principal Act means the National Health Act 1953 .(2) Despite the repeal of section 73BAB of the Principal Act by item 2: (a) that section is taken to have continued in force in relation to registered organisations until the new prudential standards day as if it had not been so repealed; and (b) any regulation or other subordinate instrument made under or for the purposes of that section that was in force immediately before the repeal of the section continues in force until the new prudential standards day unless, before that day, that regulation is disallowed, or that regulation or other instrument is revoked or varied in accordance with the section as so continued in force.(3) Despite the repeal of section 73BAC of the Principal Act by item 2: (a) that section is taken to have continued in force in relation to registered organisations until the new prudential standards day as if it had not been so repealed; and (b) any exemption under that section that was in force immediately before the repeal of the section continues to have effect, according to its tenor, until the end of the period specified in the exemption or until the new prudential standards day, whichever first occurs, unless that exemption is earlier revoked under the section as so continued in force; and (c) any application for such an exemption made before the repeal of the section that had not been dealt with before the repeal is to be dealt with, on and after the repeal, in accordance with the section as continued in force.(4) Despite: (a) the amendment of subsection 73BEB(1) of the Principal Act by item 4; and (b) the repeal of paragraph 82G(1)(c) of the Principal Act by item 5; and (c) the repeal of paragraph 82G(1)(q) of the Principal Act by item 8;the Principal Act continues to have effect, until the new prudential standards day, as if that amendment and those repeals had not been made.(5) Despite the repeal of paragraphs 82G(1)(f) and (g) of the Principal Act by item 7, the Principal Act continues to have effect until the new prudential standards day as if item 7 had not repealed and replaced those provisions but had provided instead solely for the repeal of subparagraph 82G(1)(g)(ii) and the substitution of the following subparagraph: (ii) to take such action as is appropriate;(18) Schedule 3, page 110 (after line 14), after item 55, insert:55A After subsection 18-15(1)Insert:(1A) Without limiting subsection (1), the *Managing Director may make a determination under paragraph (1)(b) if the Managing Director is of the opinion that information given by or on behalf of: (a) the Commonwealth; or (b) a *health fund;to a person from whom an amount is recoverable about that person's entitlements under this Act was incorrect or misleading in a material particular.(19) Schedule 3, item 56, page 110 (after line 26), after subsection (1), insert:(1A) If the HIC decides to make such a set-off in respect of a person or his or her estate, the *Managing Director must serve on the person or his or her legal personal representative or the legal personal representative of his or her estate a notice of the decision.(20) Schedule 3, page 110 (after line 31), after item 56, insert:56A At the end of Division 18Add:18-25 Reconsideration of certain decisions under this Division(1) You may apply to the HIC for the HIC to reconsider the following decisions: (a) a decision that an amount is recoverable as a debt due to the Commonwealth under: (i) paragraph 18-5(1)(a) or (b); or (ii) paragraph 18-5(1)(f) in respect of a payment made to an individual; or (b) a decision under subsection 18-20(1) to set off a debt against an amount otherwise payable to a person or his or her estate.(2) The application must: (a) be in writing; and (b) set out the reasons for the application.(3) The application must be made within: (a) 28 days after the day on which you are notified of the decision; or (b) if, either before or after the end of that period of 28 days, the HIC extends the period within which the application may be made—the extended period for making the application.(4) Upon receiving such an application, the HIC must: (a) reconsider the decision; and (b) either affirm or revoke the decision.(5) If the HIC revokes the decision, the revocation is taken to be a decision: (a) in the case of a decision mentioned in paragraph (1)(a)—to waive the debt; or (b) in the case of a decision mentioned in paragraph (1)(b)—not to set off a debt against an otherwise payable amount.(6) The HIC must give you a notice stating its decision on the reconsideration together with a statement of the reasons for its decision.(7) The HIC must make its decision on reconsideration of a decision within 28 days after the day on which it received an application for reconsideration.(8) The HIC is taken, for the purposes of this Division, to have made a decision confirming the original decision if it has not told the applicant of its decision on the reconsideration before the end of the period of 28 days.(21) Schedule 3, page 114 (after line 7), after item 61, insert:61A At the end of section 19-10Add:; (g) a decision by the HIC under section 18-25 on reconsideration of a decision: (i) that an amount is recoverable as a debt due to the Commonwealth under: (a) paragraph 18-5(1)(a) or (b); or (b) paragraph 18-5(1)(f) in respect of a payment made to an individual; or (ii) under subsection 18-20(1) to set off a debt against an amount otherwise payable to a person or his or her estate.(22) Page 118 (after line 31), at the end of the bill, add:Schedule 4—The professional services review scheme Health Insurance Act 1973 1 Section 19BOmit "106T" (wherever occurring), substitute "106TA".2 Subsections 106KA(1) to (3)Repeal the subsections, substitute:(1) Subject to subsections (2) and (2A), if, during a particular period (the relevant period ), the circumstances in which some or all of the referred services were rendered or initiated constituted a prescribed pattern of services, the conduct of the person under review in connection with rendering or initiating services during that period in those circumstances is taken, for the purposes of this Part, to have constituted engaging in inappropriate practice.(2) If the person under review satisfies the Committee that, on a particular day or particular days during the relevant period, exceptional circumstances existed that affected the rendering or initiating of services by the person, the person's conduct in connection with rendering or initiating services on that day or those days is not taken by subsection (1) to have constituted engaging in inappropriate practice.(2A) However, subsection (2) does not affect the operation of subsection (1) in respect of the remaining day or days during the relevant period on which the person rendered or initiated referred services even if the circumstances in which the referred services were rendered or initiated on that day or those days would not, if considered alone, have constituted a prescribed pattern of services.(3) The regulations may prescribe, in relation to: (a) a particular profession; or (b) an identified group or groups of practitioners in a particular profession;circumstances in which services of a particular kind or description that are rendered or initiated constitute, or do not constitute, a prescribed pattern of services for the purposes of subsection (1). 21:30:0012436Wooldridge, Dr Michael, MPDr WOOLDRIDGE8E4ChisholmLPHealth and Aged Care10—I move:That the amendments be agreed to.The Health Legislation Amendment Bill (No. 3) 1999 addresses the concerns held by government, consumers and the private health insurance industry about the prudential regulation of private health insurance businesses. The bill also makes improvements to the legislation that underpins the federal government's private health insurance rebate. The Health Legislation Amendment Bill (No. 3) 1999 will promote efficiency in the essential regulation of health funds and the Private Health Insurance Administration Council and increase protection for health fund contributors. The government amendments contain transitional provisions to ensure that there is no gap in the coverage of prudential regulation relating to registered organisations. Thus, the transitional measures allow the current legislative amendments to continue to apply until 1 January 2001 at the latest. By this time the Private Health Insurance Administration Council will need to have established solvency and capital adequacy standards, which will form the basis of the new prudential regulation regime. Thus, the government amendments provide certainty for registered organisations as to the prudential regime that is to apply to them at any given point in time. The amendments do not change the intent of the legislation and will have no impact upon private health insurance consumers, medical practitioners or private hospitals. In addition to the private health insurance aspects of this bill, the government amendments will also cover the Professional Services Review Scheme. Amendments to the Professional Services Review Scheme relate to two specific provisions of the Health Insurance Amendment (Professional Services Review) Act 1999. Firstly, a minor amendment is required to section 19B to correct the statutory references to a final determination. Prior to the amendments made by the Health Insurance Amendment Act 1999, a final determination was made under 106T. It is now made under new section 106TA, and this amendment ensures all references to section 106T are replaced with references to section 106TA. Secondly, section 106KA requires rewording to clarify the operation of the high volume deeming provisions. The opposition is moving amendments and, for the most part, they are sensible developments on the framework of this legislation and, as a result, the government is willing to support them. I would like to thank all members and senators for their contributions to this debate.21:33:0012436Macklin, Jenny, MPMs MACKLINPG6JagajagaALP00—I am pleased to join with the Minister for Health and Aged Care and commend to the House tonight the amendments to the Health Legislation Amendment Bill (No. 3) 1999 , which are supported by all parties in the Senate. These amendments make a number of substantial improvements to the government's bill which, as the minister said, deals with the operation and powers of the Private Health Insurance Administration Council.The amended bill now before us extends the regulatory powers and the independence of the Private Health Insurance Administration Council from the department and the minister in all but matters of policy. This bill will transfer further functions and powers from the Department of Health and Aged Care to the council to enhance its role as an industry regulator, and this includes the power to register funds, cancel registrations and approve mergers.In the original debate I referred the government to the Industry Commission's report No. 57 into private health insurance. On page 364 of that report it states:The overriding purpose of any regulatory regime should be the protection of consumers and not the protection of inefficient funds.This advice remains just as valid today as it was when first given nearly three years ago. The opposition has argued consistently that the private health funds would be strengthened by being more accountable to consumers. This is one of the key objectives of the opposition in relation to private health insurance and I am pleased the government has accepted the opposition's amendments to give a stronger set of consumer rights for those with health insurance.Under the opposition amendments, the council will have a clear set of objectives which require the protection of consumer interests and the minimisation of premium increases. Other important changes include public reports showing the price increases for each fund in each state, which will allow consumers to shop around between health funds. Rule changes can no longer be kept secret. All members will receive a plain English explanation of changes before they become effective. Appeals will be allowed against decisions by the Health Insurance Commission to recover overpayments of the 30 per cent health rebate and allow a waiver where the overpayment is due to incorrect information or administrative error.These changes will give consumers more power and force the industry to be more competitive. The disclosure of price increases is a particularly important measure. Earlier this year the minister claimed, misleadingly, that the average increase in health insurance premiums was 4.8 per cent. We have never seen the evidence for this claim. It is true that Medibank Private achieved a very commendable outcome by controlling its costs and operating efficiently, with the result that Medibank Private customers paid an increase of only 1.9 per cent.The minister tells us that other nameless funds had no increase at all. Unfortunately, we have had a curtain of silence that has kept the details from the public and from the opposition, despite efforts on our part to get this information through FOI. What the minister did not want to be known publicly, for reasons known only to himself, is that some funds have had increases, we understand, of up to 22 per cent, including some moderately large funds with increases of around 15 per cent. As I say, up until now we have been unable to get the full list of increases.Consumers have a right to be protected from unjustified increases and they have a right to public information to allow them to shop around if they find they belong to an inefficient or badly run fund. This is a disgraceful situation as there are no grounds for treating the increases in premiums as govern ment secrets. This bill will end the secrecy. From now on there will be full disclosure of the premium increases that health funds make in each state. I call on the minister to release tonight or as soon as possible the premium increases that occurred on 1 June 1999 this year in the format that will now be required by the passage of this legislation.The opposition support each of the changes proposed by the government because we believe that all of them will make the industry more accountable and more in line with the expectations of their membership. The additional amendments now being incorporated will further strengthen the Private Health Insurance Administration Council as the industry regulator. (Extension of time granted)Unfortunately, the private health insurance industry has not always had the best consumer record, as documented in the annual reports of the Private Health Insurance Ombudsman. The opposition has consistently urged the government to go further to reconstitute the council as a fully independent regulatory body with its own clear statutory powers and resources and a brief to protect consumer interests and dampen the rapid spiral of health insurance premiums.The opposition has also inserted amendments to improve the accountability of the Private Health Insurance Administration Council. Council members will no longer be able to be drawn from people managing or working for a fund. This will ensure that it operates at arms-length from the industry.The huge rebate the government is now pouring into private health insurance adds weight to the argument that there needs to be effective monitoring of the spending of that rebate. This bill, with the amendments incorporated in the Senate, has greatly strengthened the prudential regulation of registered funds. PHIAC has been given increased powers of oversight and the power to order the appointment of an administrator or the wind-up of a fund.It is worth noting that, as at 30 June last year, PHIAC reported that there were five out of 44 funds in breach of these solvency standards. It is true that this is down from nine in the previous year, but it is still of concern that this many funds are in breach of these requirements. This bill will require the council to establish written solvency standards after consulting with the Australian Government Actuary. Under the opposition's amendment, the council will now be required to publish its reasons if it decides to reject the advice of the Government Actuary so that the council's decisions will be more transparent.Lastly, the bill corrects a number of defects in the 1998 private health insurance rebate legislation. Recipients of the rebate will no longer be required to register annually to receive the rebate, making the administration of the rebate simpler. The Health Insurance Commission will be required to pay claims within 14 days. Fund members who have had a claim rejected will be able to seek a review by the Health Insurance Commission before having to go to the Administrative Appeals Tribunal as currently applies.All these changes have made the bill stronger. This will be good for the long-term health of private health insurance funds. I look forward to the passage of the bill and the rapid implementation of its provisions which will result in a more accountable and consumer friendly private health sector.21:41:0012438Wooldridge, Dr Michael, MPDr WOOLDRIDGE8E4ChisholmLPHealth and Aged Care10—Some comments have to be made in reply to the shadow minister's contribution. Firstly, in terms of the premium increase of 4.8 per cent, I was not aware that the opposition had put in an FOI request. They could have asked, but I am told the reason it is delayed is that it was sent to the wrong place. You sent it to PHIAC rather than to the department and I cannot help your incompetence. Secondly, on the noting of rapidly escalating premium increases, the fact is that premium increases are lower than they have been for ages and substantially lower than you were ever able to achieve yourself.Thirdly, the 4.8 per cent is on a weighted average. It is true some tables went up a very high amount but, if those tables have only 10 members in a fund that has 100,000 members, surely one has to weight them. The fact is that the outcome this year was very good, particularly by Labor's own pathetic stand ards, and will be even better next year, I suspect. Finally, while I am pleased and happy about the nature of the people on the PHIAC board, of course the government has never actually appointed someone who is managing or working for funds. So the opposition's contribution there, like most other things, is pretty irrelevant.21:43:0012438Macklin, Jenny, MPMs MACKLINPG6JagajagaALP00—Given the minister's remarks about the availability of the premium increases by fund and by state, I take it that he will now make that available in response to my request tonight. Is that correct?21:43:0012438Wooldridge, Dr Michael, MPDr WOOLDRIDGE8E4ChisholmLPHealth and Aged Care10—I am happy to look at it but, given everything else you have done in this area has been carping, negative and opportunistic, I would want to see it was slightly positive. That would be a change.21:43:0012438Macklin, Jenny, MPMs MACKLINPG6JagajagaALP00—It is unfortunate that that is the minister's attitude. I took by his remarks that he was in fact agreeing to these amendments in the legislation that we are debating here tonight, which would see the Private Health Insurance Administration Council make this information available. Given that he is agreeing to those amendments, I would ask that he provide the information as of 1 June this year which would give us the detail about the health fund premium increases by fund and by state. That would be appreciated.Question resolved in the affirmative.Bills12438r91312438Consideration resumed from 19 October.Senate's amendments—(1) Schedule 1, item 2, page 3 (lines 6 to 9), omit the item.(2) Schedule 1, item 3, page 3 (lines 10 to 14), omit the item.(3) Schedule 1, item 5, page 4 (line 3) to page 5 (line 3), omit the item. (4) Schedule 1, item 11, page 6 (lines 9 to 24), omit the item.21:45:0012439Anthony, Larry, MPMr ANTHONYXJ6RichmondNPCommunity Services10—I move:That the amendments be agreed to.It is encouraging that most of the measures in the Family and Community Services Legislation Amendment (1999 Budget and Other Measures) Bill 1999 have been supported by the opposition, and I would just like to allude to some of the areas where there has been agreement. One of the key areas where there has been agreement is in relation to the youth allowance and the definition of `independent employment'. This measure has been welcomed by many young people, particularly those connected with families on farms in regional Australia. This measure will extend the definition of `independent employment' used in the family actual means test to include young people employed by their families.Until these amendments, we had a bit of a ludicrous situation whereby if I was a young person I could not go back and work on the family farm because that would knock me out for the youth allowance, but it was acceptable to work on the neighbour's farm. This change in the definition of independent employment allows for those circumstances, particularly when it comes to a family business or a farm, to be excluded up to the existing allowable measures.Another measure with respect to the youth allowance was the secondary student boarder concessions. This measure replaces the complex formula that must currently be applied in calculating the concessions available for families where a family member is an isolated boarder or secondary student boarder. This also acknowledges that there needs to be a bit of flexibility in the youth allowance area for those people in remote areas. Effectively it means that the existing complex formula will be replaced with a fixed amount of allowable spending of $5,274. This is quite generous and, of course, has a negligible financial impact.Another measure also to do with youth allowance is the extension of the eligibility for the Student Financial Supplement Scheme loans. This loan scheme gives dependent tertiary students the option of borrowing money to help cover expenses while studying. This limit has been put up to around $1.6 million for parental assets by increasing the current discount for business assets from 50 per cent to 75 per cent. This will mean that students in more isolated regions will have the capacity to take out those Student Financial Supplement Scheme loans, which will obviously be very beneficial. Of course, there is some financial impact on the budget. The opposition's support for these amendments is welcomed.Another measure which has seen agreement has been the establishment of the Family Assistance Office. This measure acknowledges that, when the new tax system comes into place, it will be crucial for there to be a smooth transition to allow for the savings bonus which a number of Australian will be eligible for. This will be a joint venture, and we will need to have access to information from Centrelink, the ATO and the Health Insurance Commission. It will be integral to get that data for formulating the new Family Assistance Office. This has also been agreed to by the opposition.R36ALBANESEMr Albanese—Very reasonable.XJ6Anthony, Larry, MPMr ANTHONY—Very reasonable—that is why I wanted to acknowledge it. It is not common practice, Mr Deputy Speaker, particularly for the member for Grayndler, but perhaps he is taking a new stance of reconciliation. These amendments are certainly very positive.In the area of new income support arrangements for separated parents involved in the shared care of children, we recognise that there needs to be a bit of flexibility. This measure was designed to remove the inequalities that we all know currently exist in the income support arrangements for adults who share the care of children. The intention of the bill was to allow separated parents who share care of their children within a 40 to 60 per cent range to both be paid a Newstart or youth allowance rather than one receiving a parenting payment and the other receiving a Newstart or youth allowance. Of course, both parents would have a modified activity test and they would have had access to JET services—the Jobs, Education and Training Program. There was some difficulty in getting access to that if you were on a parenting payment. New claimants with less than 60 per cent care of the child would no longer qualify. (Time expired)21:50:0012440Albanese, Anthony, MPMr ALBANESER36GrayndlerALP00—I am pleased to have the opportunity to make a contribution to this debate on the Family and Community Services Legislation Amendment (1999 Budget and Other Measures) Bill 1999 . This bill is of course an omnibus bill in that it puts together a range of amendments to current operations in the family and community services portfolio. That, I guess, is where we have a major global problem. Given that the Minister for Family and Community Services made such a fuss over her proposed speech to the National Press Club, we are firmly of the view that it is appropriate and it is time that the minister comes clean as to exactly what her agenda for welfare reform is. What we see as her agenda for welfare reform is not reform but cut after cut after cut.This hotchpotch of a bill once again is an example whereby in some measures the government has got it right—and we supported the government with respect to those measures—but in other measures the government got it wrong. That is why the Australian Labor Party is putting forward an alternative vision from opposition of welfare reform into the new millennium. At the ACOSS congress two weeks ago the shadow minister for family and community services, the member for Lilley, gave an alternative view of the future of welfare under the theme of cooperation not competition. It was a vision of Australian society in which people were lifted up and given a helping hand and not left behind to the vagaries of the market. At that congress, the member for Lilley released a family insecurity index taken from ABS figures which shows that family insecurity has increased 2½ times faster under the current government since its election just three years ago—a horrifying fact.The fact is that in respect of this amendment before the House, which the government is reluctantly agreeing to, it is a bit like the previous debate in which I participated with the minister opposite where they took $80 per fortnight off indigenous sole parents in remote areas. That was one example of their reforms. This time around, there is a new target. The new target is parents who have shared responsibility for caring for their children. The government proposed in its original bill to change income support arrangements for separated parents who share the care of a child. It was only to apply when the care of a child was shared roughly equally; that is, when one parent did not have at least 60 per cent responsibility for their share of the care of the child. In these cases, one parent is normally qualified for parenting payment while the other has been eligible for Newstart or Youth Allowance. The changes which were proposed in the original bill would have meant that neither parent was eligible for the parenting payment and that both parents would be eligible for Newstart or Youth Allowance, albeit with a modified activity test. This meant that the government's proposals would have denied either parent access to the more generous parenting payment and forced both to at least seek some work. It is appropriate, perhaps, to put on the record an email received by the shadow minister from a constituent of his. That constituent said:Dear Wayne,The life of a sole parent is always sad.But when an eight year old child can see exactly why social policy is sad for her, then policy is very far away from our needs.This is a record of a conversation with my eight year old as she watched your counterpart in government on the news on Wednesday morning on the Today Show. The minister was telling of her latest methods for punishing sole parents. Child: "Mummy are we a sole parent?"Mum: "Yes, we are".Child: "Then what she is saying is that I will not ever work because we are sole parent".Mum: "Yes, she's very naughty to think that isn't she".Child: "She says you have to go to work but you already always work. She's pretending that sole parents don't work".Mum: "Yes, she's very naughty to think that sole parents don't work".Child: "Even if we do stay poor". In the words of the constituent: `How sad is that?' (Time expired)21:55:0012441Anthony, Larry, MPMr ANTHONYXJ6RichmondNPCommunity Services10—I want to finish a couple of points before I take up some of the comments made by the member for Grayndler. As I was saying, the new claimants with less than 60 per cent care of a child will no longer qualify for parenting payments even if their ex-partner was not claiming an income support payment. This would have allowed parents to exercise flexibility in their caring arrangements without having to change payments. With the support of the Democrats in the Senate, the intention has been rejected by the opposition. Therefore, the government will be accepting the amendments at this time. But it is important to acknowledge what even the shadow minister for family and community services, Chris Evans, said on 18 October about this legislation. I think it is quite inappropriate for the current opposition speaker to say that they have thought through a particular measure when it comes to this parenting payment. I quote Senator Chris Evans:I think everyone concedes that the current system is not the perfect outcome. We would encourage the government to have another look at ways of achieving some of those stated objectives without having the effect of removing a range of benefits from one of the parents, as is contained in this current measure.The Labor Party does not have a position on that, but it recognises that there is a problem between two parents who might be sharing the care of a child, whether one is on a parenting allowance or one is on a Newstart allowance, and we must ensure that both of them are given the opportunity, at least, of not being trapped in a constant area of welfare dependency—if that is their choice—by accessing JET programs or whatever. The Labor Party recognises that there is an anomaly here and that perhaps there is another way forward to ensure that, where there is shared care—we certainly encourage shared care when a child is involved—there are options. That is certainly the intent. The House should acknowledge that speech by the shadow minister for family and community services which is recorded in Hansard .At the end of the day, these measures that we have put into place are very positive for young people with regard to the Youth Allowance. The current opposition speaker should really stick to the bill rather than go off at convenient tangents in an area where, quite frankly, the history of coherent social policy was very wanting from the Labor Party in the 13 years of their own stewardship. These measures are positive. As I mentioned before, when it comes to independent employment, the Youth Allowance is a very good measure. The secondary students boarder concession is a good measure. The access to student financial supplementary scheme loans is a good measure. As I have said, there are the new arrangements for the Family Assistance Office. Both of us recognise that there are perhaps areas that we need to look at when it comes to shared care, but that will have to take place at another time.21:58:0012441Albanese, Anthony, MPMr ALBANESER36GrayndlerALP00—The minister says that the opposition acknowledges that currently there is an anomaly with shared care. The opposition has certainly put it on the record that the current system is not perfect. We have put that on the record and we acknowledge that legislation must be kept up to date. Our problem is with this government's measure, which is why we amended it. That we are right is shown by the fact that this government will be accepting our amendments. It says that it encourages shared care. Let us look at the impact of its proposals. The changes would have discriminated against parents who have established fairly evenly shared care arrangements. Our bottom line is that, once again, in the name of reform we had a proposal for cuts. People currently on parenting payment would have lost up to $77 per fortnight under the government's proposal. But it does not stop there. The person receiving the parenting payment would have lost access to the pensioner education supplement, the telephone allowance and the pharmaceutical allowance. They would also have been subject to the less generous allowance income test exposing them to an increase in effective marginal tax rate when they accept part-time work.The proposal would have acted as a disincentive for parents to reach an even agreement on shared care. The net loss of income to the family would disadvantage the child, who is the person we should be most concerned about. The total income lost to the family would have been up to $50.60 per fortnight. Our concern is that once again this effectively was a savings measure for the government. Once again, the measure is part of a broader government agenda to remove social services and to impose an unfair tax system on the people who can least afford it.The GST will push most of the vulnerable members of our community over the edge as a four per cent rise in social security benefits is eroded away by the expected rise in inflation, which will be in excess of five per cent at a minimum. The cost of compensation for the GST alone will drive welfare spending from $44.5 billion to a massive $50 billion in the first year of the new millennium. That is an increase of $5.5 billion in just one year.That is why the government is looking at further cuts to the system. Look at the measure before the House. Unless the Labor Party had amended it, it would have saved between $2 and $3 million. It is expected that some 2,700 people would have been affected in the year 2001. There is the social cost of pitting parent against parent rather than encouraging a cooperative relationship in which parents are given an incentive to get together in the interests of the child. This measure would have pitted parent against parent and given them a financial incentive to have a dispute over the custody of the child. That is no way to move forward in family policy. It is not genuine reform. It is consistent with the minister who cuts and slashes. In terms of her big agenda, it remains in the bottom drawer. This is why the government fails to release its future agenda.The government only cares about blaming the victim. Whilst the minister tonight has not given the rhetoric, we have all heard the rhetoric about these single parents and people on disability support pensions ripping off the system. It is an entirely inappropriate way for a compassionate government to behave. This government talks a lot about battlers. The only thing it is good at is creating more of them. The Labor Party has consistently moved amendments to the uncaring legislation put forward by this government to stop the government making these cuts and to defend the people who most need defence in our society. I am very pleased that the Australian Labor Party has been successful in stopping this reactionary move, which would have taken $77 per fortnight off people receiving the parenting payment. (Time expired)Motion (by Mr Anthony) agreed to:That the question be now put.Original question resolved in the affirmative.Bills12442r95012442Debate resumed from 21 October, on motion by Mr Slipper:That the bill be now read a second time.22:04:0012442Thomson, Kelvin, MPMr KELVIN THOMSONUK6WillsALP00—The first comment I ought to make about A New Tax System (Indirect Tax and Consequential Amendments) Bill (No. 2) 1999 is to reflect on the volume of tax legislation that has come from this government. This is, after all, the government which was going to make tax legislation simpler. We have here 151 fresh amendments to the new tax system. That now brings the total to 907 amendments. We could have a millennium of amendments before we see in the new millennium. After all, this is from a government which said that they would cut red tape for small business by 50 per cent. If they had said that they would increase the red tape for small business by 50 per cent, we could say that they had delivered. It is not possible for me to cover all 151 amendments in the 20 minutes available to me. However, there are a number of different areas that I wish to canvass.The first is that of insurance, which is one of the main themes of the bill. The insurance industry has faced major costs as a result of the government's inadequate transitional arrangements. The industry was reported in the Australian Financial Review of 17 November to have lost more than $200 million over the transitional impact of the GST. The NRMA is facing an $81 million expense; for HIH, it is $50 million. General insurers are reported as increasing their premiums on more than 30 million policies to recoup part of a $1 billion shortfall once the GST takes effect.This bill tries to sort out a couple of GST and insurance issues. First, it proposes to exclude from the GST state stamp duty on insurance policies. But I point out that, if the states levy the stamp duty on the GST, as they appear to be in the process of now doing, the effect will be the same.There is also an amendment to ensure that businesses registered for GST purposes will not be able to claim input tax credits on compulsory insurance schemes. An example is compulsory third party insurance for motor vehicles. That saves the potential disaster of an insured small business having to pay GST on a payout under a policy—that is the kind of thing which causes a small business to go broke—but it also increases the overall cost structure for small businesses by tens of millions of dollars per year. This is from the government which is supposed to be looking after small business.Furthermore, many questions regarding insurance and GST have still not been answered. Let me raise what is really a basic common-or-garden insurance situation. I pose the question: a shopkeeper loses $1,000 from the till in a burglary; he makes a claim on the insurer; the insurance company pays the shopkeeper $1,000. Must the shopkeeper pay one-eleventh of that to the tax office? I have been told that they would have to. I would greatly appreciate the minister providing a response. Let me point this out against the background that an insurance claim payment is never a purchase of value added. It is compensation for already owned value that has been lost. You can see from that example that, if you have $1,000 taken from your till and you are able to get it back on the insurance claim, it would be manifestly unfair to be required to pay an amount of money to the tax office.In terms of the issue of clarification, I turn to life insurance. The Treasurer's answer to a question that I put on notice some time ago was that life insurance would be GST exempt but input taxed, while other forms of insurance would be subject to the GST. The Treasurer's answer went on to say that other forms of insurance, for example disability insurance, would not be subject to the GST if they were included in a life insurance policy which `retains the character of life insurance'. I am very concerned that that is a recipe for complexity, abuse and litigation. Most lawyers I know, if they read words like `retains the character of', start thinking about a new car. This could become as complex as the Treasurer's well-known gingerbread man. I remember discussing this issue with people in the insurance industry, who agreed that the situation was unclear and complex. They anticipated that there would be further GST bills amending legislation if the first lot of GST bills managed to make it through the Senate. As we can see from the legislation before the House, with its hundreds of amendments, they were and are absolutely right.What has been the actual impact in the real world on insurance premiums? First, let me draw to the attention of the House correspondence from the Royal Automobile Association of South Australia to South Australian Senator Crowley. They refer to correspondence from her concerning the transitional implications of the goods and services tax on membership renewals. Their letter says:We have had no alternative but to accept the situation. . . Our calculations indicate that because a high percentage of our costs are labour related, savings resulting from input tax credits will not be sufficient to offset other increased costs and therefore we will need to charge the full 10% GST.Nowhere in its calculations was this government suggesting that insurance companies might be charging the full 10 per cent GST.An example I have had brought to my attention from a Geelong family is even worse. They have provided the full details of the insurance on their house, on their contents, on the valuables and on two motor vehicles. They have adopted what can only be described as standard insurance practice in increasing the sum insured on the house and contents by just under two per cent to allow for increased costs. But with valuables the sum insured has not changed, and yet in that case the premium has increased by 10 per cent. The premium on one of the motor vehicles, a six-year-old car, increased by 10.9 per cent, the fire services levy increased by about 22 per cent, the stamp duty increased by about 14 per cent and the GST was added on the basis of 10 per cent on a calculation for five months. It was just five months of the premium because this was a policy which is going from December this year through to December in 2000. Overall, the family's insurance premium on the exact same items, which are 12 months older and subject to depreciation in the case of motor vehicles, has leapt by just under 14 per cent—some 13.8 per cent; an overall premium increase of over $239. This is an extraordinary hike and it raises the critical issue about this kind of premium increase, its implication for GST price rises overall and the reliability of the government's calculations about what impacts the GST is going to have.Those who have made their way through the ANTS documentation will know that that original figure of a 1.9 per cent increase in prices was predicated on an 0.8 per cent increase in insurance premiums. So a less than one per cent increase in insurance premiums was predicted by the government prior to the election and prior to it bringing its legislation into the House, but in the real world we see insurance premiums increasing by 14 per cent. What we should have been doing, perhaps, was taking out insurance against the GST. Of course, over 51 per cent of Australians did that last year but unfortunately the Howard government was re-elected nonetheless.I think it is the case that we can see GST already pushing up prices and we can see the hand of GST behind the recent interest rate increase. We saw prices rising by, as I recall, 0.9 per cent in the last quarter. In January this year, the three-year fixed rate on bank loans was 6.45 per cent. By the end of September, before the Reserve Bank had raised interest rates, the three-year fixed rate on bank loans had risen to 7.3 per cent, an 0.85 percentage point increase before the latest increase. So you see the GST behind interest rate increases, you see it behind increased bank fees and charges, and we saw the head of the Commonwealth Bank, David Murray, recently stating that his bank alone will be passing on to consumers via higher bank fees some $70 million per year in GST costs.These interest rate increases are just another down payment on the Liberal-Democrat GST. Prices are already rising because of higher housing, insurance and travel costs triggered by the introduction of the GST. I have had quite a lot of people in my electorate bringing to my attention their concern about price increases in supermarkets and in the other places where they shop. They are convinced that these price rises are being brought through in anticipation of the GST, with retailers endeavouring to increase their margins ahead of more concerted monitoring from the ACCC.I also point out that this government spends an awful lot of time boasting about its economic management credentials. But if we look at what is happening with prices and interest rates, the GST—the centrepiece of this government's economic policy for the past two or three years—is destined to destroy these very credentials, pushing up inflation and pushing up interest rates.The other issue I want to raise in a similar context is the fact that we do not have a way of seeing what the GST is on particular items. I have been talking about the insurance industry. To its credit it has been quite up-front in pointing out what will be the impact of the GST on insurance premiums. But as a general proposition this kind of information is not available and will not be available to consumers.I have received, as other members might have received, correspondence from the West Wallsend Combined Pensioners Association quite recently. They expressed concern that the government needs to clamp down on price rises on foods prior to the goods and services tax becoming part of the tax system. They said that one supermarket increased the price of a generic brand of wheat bran from 57c to $1.12 over a period of a few months. They go on to say:A further concern of this Association is, what items are taxed or not taxed?We strongly suggest that the amount of Goods and Services Taxes be displayed prominently and separately on all items affected by the tax.The very Treasurer who managed to sound so scandalised when he talked about the secret, hidden wholesale sales taxes is now hiding the impact of the GST from consumers. The West Wallsend Combined Pensioners Association are absolutely right to want to know what items are to be taxed and what items are not to be taxed. They are absolutely right to demand that this information be made public, and the Treasurer's refusal to do this condemns him as an A-grade hypocrite.Let me turn to the impact of the GST on petrol prices. During last year's election campaign the coalition swore black and blue that they would not allow the GST to increase petrol prices. On 7 September 1998 the Treasurer said:The government's proposed new tax system will not lead to any increase in petrol prices.On the previous day all Liberal Party candidates had received advice from Liberal Party campaign headquarters which said:There will be no increase in the price of petrol as a result of the GST. The reason is that the government will reduce the petrol excise by an amount equivalent to the GST.When this issue was raised in question time today all we got from the Minister for Transport and Regional Services was that there would be no need for petrol prices to rise because of the GST. But, if you have a reduction of 7c a litre in excise and if the GST then applies to a price of 77c a litre, clearly it will have an impact greater than the excise reduction. In those circumstances a GST will increase petrol prices.One thing that motorists out there know for sure is that the Liberal Party is in government, the Liberal Party abolished wholesale price controls on petrol and now petrol prices are going up. It can do all the dissembling it likes on the issue, but the proof is at the bowser. Every time motorists go to a petrol station, the evidence of this government's performance on petrol prices is plain for all to see. You can fool some of the people some of the time, but you cannot fool everybody and you will not fool everybody on petrol prices.Let me now turn to the motor vehicle industry. I am very concerned about evidence that car manufacturers are experiencing a buyers strike in the period leading up to the implementation of the GST. It has been reported this week that over 3,500 workers at the Ford Broadmeadows and Geelong plants will be stood down for some 12 days next year directly as a result of a GST-induced buyers strike. The evidence of a buyers strike is becoming overwhelming. We have seen manufacturers cutting production and standing down workers including, as I mentioned, at Broadmeadows Ford. There is a glut of cars, 100,000 of them sitting in car yards, because dealers are finding it difficult to shift them. There has been a massive decline in new car sales.There is anecdotal evidence of problems for car dealers and other small businesses in associated motor trades. Not only do we have thousands of Australians who work directly in car manufacturing being affected by the current situation, we have the owners and employees of more than 80,000 associated motor trade small businesses who are also potentially threatened. There are part and component suppliers, dealership owners, used vehicle salespeople, airconditioning installers, radio and stereo specialists and many others. It is time for this government to take some action to protect jobs by introducing improved GST transitional arrangements for the car industry.The Treasurer's refusal to provide proper transitional arrangements for the car industry is an act of gross insensitivity. He sits there while the industry burns, making no attempt to douse the fire. The car industry is supposed to be a great beneficiary of the GST, but what of the carnage in the meantime? The Treasurer reminds me of that infamous American general who said of a Vietnamese village, `We had to burn it in order to save it.'We still have a situation of massive confusion concerning the GST. We asked questions of the government yesterday in question time. The government said that it would provide small businesses with a voucher to offset the cost of the GST. The value of the voucher is $200—a fraction of the estimated $3½ thousand compliance cost facing each small business. The government was not prepared to walk away from its special rebate for high rollers at casinos, despite the Prime Minister's statement that people who are on the rich list can pay the GST and the ordinary taxpayer is not going to subsidise them. The Prime Minister could apply the GST to premium Olympic tickets but he was not prepared to put pen to paper to scoop up the casino high-flyers.The Treasurer was acting to keep the GST off stamp duties but he was not prepared to act to keep stamp duties off the GST. He confirmed that people paying residential rents may have to pay GST on part of their rent if the house or unit is furnished. Where the residence includes furniture, the non-furniture component of the rent will have no GST—that is to say, it will be input taxed—but the furniture can be hit by the GST if it is the subject of a separate contract. In my view, this will be a nightmare for both renters and landlords as they try to sort out what the rent is on the furniture and on the property.In conclusion, this is terribly complex legislation. It has 151 amendments on top of the 756 previous amendments which the government put forward in this area. It covers things such as financial supplies, insurance situations and exemptions for diplomatic, consular and related privileges and immunities. The financial services issue is extremely complex but, as it has been explained to me, it effectively amounts to the application of a six per cent GST on financial services. That is very interesting coming from a government which complained about differential rates of wholesale sales tax.We are not opposing this legislation. We think it should be scrutinised in the Senate in much more detail than we have been able to examine it here. We do not oppose the propositions the government has put forward but we note that, in coming up with something like one thousand amendments to its GST legisla tion in the space of the past few months, this has proved to be anything but the simple tax system that it was undertaken to be.22:24:0012446Baird, Bruce, MPMr BAIRDMP6CookLP10—It is particularly interesting to follow the member for Wills, having heard him speak supposedly on the A New Tax System (Indirect Tax and Consequential Amendments) Bill (No. 2) 1999 . The problem was that he barely touched the provisions of this particular piece of legislation. He dismissed them in about half a minute and then ranged across a whole lot of rhetoric related to the GST, ignoring the reality. Lots of conspiracy theories exist according to him but the alarmist concerns he raises have no substance in reality.Let us look at just one of the issues he raised—the crisis in the car industry. Sales are marginally down, but the fact is that sales are still well above what they were in 1997. Not only that, but when the GST comes into play there will be a reduction from 22 per cent to 10 per cent. He is complaining about the impact now, but what is he going to say when the GST comes in and the average motorist in his electorate has the advantage of saving thousands of dollars which are directly translatable into the economy?His claims are not based in reality. For example, on the fuel tax, he claimed that the price of fuel is going up at the bowser because of this Liberal government. That simply ignores the reality that imported crude oil prices have gone up. As night follows day, if the price of crude goes up in the Middle East then petrol is going to be more expensive at the bowser. But, of course, it suits the member for Wills to have these conspiracy theories and to say that it is all orchestrated by the coalition government rather than that it is simply a matter of supply and demand and market prices.He talked about price increases in supermarkets across the board. As chairman of the retail inquiry, I know we had regular updates on the price increases that are occurring in supermarkets. In real terms, the prices in the supermarkets are lower than they were in 1972. I do not know on what basis he is gathering this information. I am sure he is quoting the concerns of various groups from centres in different parts of Australia. There may be concerns from the pensioner groups, but I am sure he did not mention to the pensioners that they would have a significant increase in the level of their pensions, which would be above the CPI increase, to allow for any changes they might experience with the introduction of the GST.The removal of the wholesale sales tax and the introduction of the GST will simplify the whole approach to taxation in this country. It will provide real incentives for taxpayers across the country. Some 80 per cent of Australians will pay no more than the 30 per cent tax rate. It will mean a regime in which Australian exporters will have no wholesale sales tax when they compete overseas and they will have no GST. That will put them in a very competitive position. The member for Wills has failed to recognise incentives for business, incentives for individuals and less complexity in the arrangements in which the GST operates.The bill before us is a consequence of the government listening to the private sector in various forums and discussion points in various electorates throughout the country and listening to the advice to the Treasurer. He has responded. We did not hear about any of that from the member for Wills. There was no recognition of the changes that have been made in response. Those responses are very different from those of the previous government which kept the old 1930s taxes in place. It had a tinker here and a tinker there, but basically tax was always on the rise and any taxation cuts that were promised were never implemented. All we saw was a constant increase in the level of wholesale sales tax.The provisions in this bill not only ensure that we have an effective taxation system but also recognise some of the small issues that need to be addressed in relation to the private sector. I look forward to continuing my comments on this bill tomorrow, but I emphasise again that this bill is going to revolutionise the Australian economy.Adjournment1244710000SPEAKERMr SPEAKER—Order! It being 10.30 p.m., I propose the question:That the House do now adjourn.1244722:30:0012447Sidebottom, Peter, MPMr SIDEBOTTOM849BraddonALP00—Regional Australia is a political time bomb. We recall the explosion at the recent Victorian state election, but the big bang is still to come. Regional Australia has had enough. It is disillusioned with the powers that be. It wants an end to the rhetoric on regionalism and it wants some action. Its disillusionment is continually fed on a menu of explanations such as globalisation, national competition policy, privatisation, the economic bottom line, and the `one solution fits all' approach. The living proof of these so-called new millennium realities is a loss of government and private services, declining social and economic infrastructure, poorer educational aspirations, high unemployment, depopulation and a sense of powerlessness.The National Institute of Economic and Industry Research is soon to release its second state of the regions report, again identifying the inequalities that exist between metropolitan and regional areas. This report, like its predecessor, says these blatant inequalities need to be addressed as a national priority if we want Australians to continue to live outside our metropolitan centres, sponge cities and coastal corridors. But what is also emphasised in this latest report is that local communities in conjunction with local government have a major role to play and indeed may hold the key to regional revitalisation—in effect, a bottom-up approach in partnership with state and federal governments.In Tasmania, and in my electorate in particular, we are already heading down that path. It is a journey in partnership and cooperation, and we realise there is still a way to go. I would like to share some examples. The Tasmanian Labor government is pioneering partnership agreements with local governments and their communities to find local solutions to state and regional problems. The aim is to create a tangible sense of ownership at the local level, to engender confidence and foster economic and social development.This process began in the far north-west of Tasmania in the beautiful Circular Head region and it is working. It is hailed as the catalyst to helping the region realise its potential. Indeed, the Mayor of Circular Head, Ross Hine, has claimed community spirit has also lifted, with doors opening and businesses growing. He recently spoke of the state government-local government partnership agreement as lifting the region because the focus was actually on Circular Head and not on some broad, generic target. It has localised the focus for partnership. The point is that a specific, local community has entered into a vital partnership agreeing on key responsibilities and outcomes to be worked towards by all parties.The concept and process of partnerships and cooperation have potential in themselves to have far wider ramifications for Circular Head and beyond. For example, they could also be the catalyst for a breakthrough in a major local issue now confronting the people of Circular Head and the broader Tasmanian community and the nation as a whole, namely, Aboriginal reconciliation. There has been much said about the state government's proposed transfer of specified land to the Aboriginal community in the district. It is a controversial issue. There are differing views and it is a sensitive and complex debate.I do not intend to argue the case, but instead to concentrate on the process for achieving the best outcome. I commend Mayor Ross Hine for his leadership on this issue and his holistic approach to partnership and cooperation in his local community. That he is now advocating that the concept and process of partnership be extended beyond the already established relationship between state government and local government is, I believe, a natural progression of the concept of partnership and cooperation. Mayor Hine is proposing a special partnership that incorporates his local council, the state government, the local Aboriginal community and local community groups, and this may put Tasmania at the forefront of Aboriginal reconciliation.He says, and I quote from his comments recorded in the Advocate of November 16:By involving all community groups to work as one, a promotion of Aboriginal heritage and culture could be encouraged and because of a mutual understanding in the community between all groups it would have a greater chance of success.This is an opportunity to promote our community as one, achieve true reconciliation and form an historic first for this State.Mayor Hine's model of partnership highlights the practical implementation of a state policy through local ownership, management and genuine community partnership. After all, a policy is only as good as its intention, which is only as good as its implementation. If the local community is genuinely involved in policy implementation it will work for it because it will be owned and valued locally. Mayor Hine's local management authority model could see this work and a true state government, local government and Aboriginal community partnership achieved.Another example of regional spirit at work, again in my electorate, is the blossoming cooperation between local government and business leaders on the north-west coast. I have watched with great interest the evolution of a much broader partnership arrangement involving Tasmania's West North-West Council Group and the West North-West Business Alliance. It is part of a multipronged push towards regionalism born out of the realisation that, unless we work together in all forms of partnership, we will not progress. (Time expired)1244822:35:0012448Bishop, Julie, MPMs JULIE BISHOP83PCurtinLP10—As 1999 draws to a close, so too does the International Year of Older Persons, and tonight I want to congratulate the federal government for bringing to the public's attention the significance of the contribution made to our society by our seniors and the International Year of Older Persons through many wide ranging initiatives. In particular, I would like to speak about the Commonwealth Recognition Awards for Senior Australians—an initiative of the Minister for Aged Care.The issue of seniors is of particular significance in my electorate of Curtin, which has the highest number of seniors of any electorate in Western Australia, with 15.3 per cent of the electorate aged 65 or older.The awards were an opportunity for local organisations, large and small, and individuals to nominate someone they thought had made a significant contribution to our community. I was delighted that the Curtin electorate had so many people of the calibre and standing of our nominees, who more than met the specified criteria. As the member for Curtin, along with every other member of the House of Representatives from every electorate in Australia, I was asked to form a community committee which would select from the nominations those people to receive an award. The members of the Curtin committee were Brigadier Bill Jamieson, Jon Broomhall, Bret Christian, Evangilia McVeigh and Santina Stransky. I thank them all, again, for their time in volunteering for the committee.I congratulate the Minister for Aged Care for the outstanding initiative in introducing these awards, which were extremely well received by all who participated in them in the electorate of Curtin—from the local people nominating people for recognition, to the committee selecting the nominees, to the award winners and to their friends and families. I held a ceremony at my electorate office in Subiaco for the award winners and their friends on 27 October last. From all accounts, it was a very rewarding experience and quite a celebration.I would like to make a short acknowledgment of each of the winners from Curtin: Mary Issell, who has worked hard to keep one of our local reserves well kept; Glady Ederfield, for her contribution to musical entertainment; Arthur Hartley, who made significant achievements in education; Mirko Riha, who had escaped from political oppression to become a renowned hydrogeologist and inventor; Stan Brown, who helped many lower income earners to own their own home; Kenneth Harley, who made a long-term contribution to the welfare of veterans; Sonia Tanham, who has helped individuals, families, migrants and patients at St John of God Hospital; Bernice Norgard, who has helped many to acquire the communication skills for which she is so admired through Probus clubs; Merilees Salter, for education and the needs of disabled students; Yvonne Johnson, for work at St Mary's Anglican Church and the Brightwater Hospice; Molly Hungerford, for her cooking, caring and driving skills for local elderly people; Valma Cearns, whose polio did not stop her from marrying, having children, becoming a senior partner in a Perth law firm, caring for her family and now helping the parents of children with disabilities; Jennifer Hood, for commitments to Red Cross, Probus, Friends of St George's Anglican Cathedral and more; Colin Cook, for many years at the Swanbourne Nedlands Surf Lifesaving Club; and Milton Hogg, for more than 35 years of community service, especially fundraising.Our overall winner was Frederick Robins, who has been described as a true Australian quiet achiever. Time prevents me from talking about all of Fred's achievements, as it has prevented me from doing more than merely touching on the work of those previously mentioned. Fred has been a member and president of Rotary, member of Legacy, justice of the peace, Children's Court magistrate, Red Cross worker, member of the RSL and worker for Meals on Wheels. It seems every corner of the Curtin electorate has benefited from Fred's commitment. Fred and his wife thoroughly enjoyed the very successful celebrations for the International Year of Older Persons as part of his prize for the Commonwealth Recognition Awards for Senior Australians held here in Canberra last week. They were delighted to be hosted by the Governor-General and Lady Deane at Yarralumla and to meet the many other award winners from around Australia. I was pleased to see our largest local newspaper, the Post, dedicated half a page to these worthy recipients of the Commonwealth Recognition Awards for Senior Australians—a most fitting tribute to a group of people who are extremely worthy of public acknowledgment for their outstanding work and dedication to others in our community.Government has a major role and responsibility to provide services and assistance to the community, but the fabric of our society and the spirit of our community are developed and enhanced by the efforts of individuals such as the Curtin electorate winners, and indeed all winners, of the Commonwealth Recognition Awards for Senior Australians. (Time expired)1245022:40:0012450Ferguson, Martin, MPMr MARTIN FERGUSONLS4BatmanALP00—I rise this evening to speak on the issue of leadership. In recent weeks we have seen the Prime Minister in South Africa where he made the award of the Honorary Companion of the Order of Australia to the former President of South Africa, Nelson Mandela, a man whose name has become synonymous with leadership and with the pursuit of freedom and democracy.I wish to speak about leadership because it must be said that our Prime Minister has shown a disturbing lack of leadership on a number of fronts. His comments to Mr Mandela at that recent award ceremony in South Africa demonstrate that he is clearly incapable of providing leadership and that he is unable to learn from his many past mistakes. When the Prime Minister spoke about Nelson Mandela's capacity for forgiveness and reconciliation as an example to the rest of the world, he missed the sad irony that he had failed to demonstrate those very same qualities in relation to Australia's treatment of our own indigenous people. When he looked into the eyes of Nelson Mandela, he was looking into the eyes of a man who has struggled selflessly for the betterment of all his people. When the Prime Minister looked into the eyes of Nelson Mandela, he should have had a closer look at a man who has come to define and symbolise hope and freedom in this century. He should have paused to see what he might glean from a man who struggled for decades to achieve better economic and social conditions and fair and just outcomes for his people. Then maybe the Prime Minister could have reflected on his own responsibilities to look at the plight of indigenous Australians.He could have reflected on his past attitudes to indigenous Australians and embraced a direction that takes indigenous people forward in this country, starting with the symbolism that comes from his apologising for the injustices of the past. The Prime Minister could also have reflected on the fact that Australians are crying out for him to take such a leadership role on behalf of our nation, and apologising to indigenous people for what we all know they have gone through is just a starting point. But it takes more than reflection. It takes a commitment to the future and recognition that education and health outcomes, employment opportunities, economic security and protection of cultural values are all essential issues that must be confronted. It takes an acknowledgment that leadership is about more than simply mouthing a few lines of contrition for terrible things that might have happened in the past.In one way, it is not surprising that the Prime Minister could offer only a few words of praise for Mr Mandela during his recent trip to South Africa. This is the same person who in nearly 30 years in parliament hardly ever showed cause to mention the name of Nelson Mandela, who was for the bulk of those 30 years incarcerated in a maximum security prison. It is not surprising that Prime Minister Howard could offer only a few words, because this is the same person who, when he was opposition leader, tried to stop the Labor government's moves to impose economic sanctions on South Africa as a way of bringing down the apartheid regime that instituted racism and imprisoned Mr Mandela in the first place. The Prime Minister's argument was that you could oppose apartheid and you could also oppose sanctions at the same time. What hypocrisy!In 1986, as opposition leader, during a debate on foreign policy he told this House that economic sanctions against South Africa would not inevitably bring about a change. He repeatedly attacked the Labor government's support of such measures, saying that sanctions were a waste of time because they were just as likely to strengthen the hand of the white minority government as weaken it. We know where he stood. His argument was proven to be fundamentally flawed, because it totally misunderstood the real impact of sanctions and how sanctions could unravel the racist economic and political elite. This is not to say that the decision of the Labor govern ment to impose sanctions was an easy decision to take, because it was not. Just ask Malcolm Fraser. When you impose economic sanctions, you must recognise that there is a downside to it: that sanctions might hurt the poorest people. But when you have tried every avenue there are times when you have got to say that you cannot accept what is going on anymore. At those times, which are crucial moments in history, it takes leadership to stand up and make hard decisions such as imposing sanctions. The Prime Minister went missing in that debate.The fact that the Prime Minister was not able to make those hard decisions then and that he is incapable of making hard decisions today is an indictment of his leadership then and an indictment of his leadership now. To now expect people to believe that he has changed is to insult the intelligence of Australians, who have very long memories. It is political hypocrisy at its most blatant and Mr Howard should not be allowed to get away with it. The stance of the opposition leader, as he was then, Mr Howard, in relation to South Africa's apartheid regime will not be forgotten by many Australians because I do not believe for one moment that the Prime Minister has changed or matured over the years. Judging from his recent trip to South Africa, where he managed to spout only a few words of contrition saying, `I guess we all change and mature over the years,' he still has a hell of a lot to learn. He is a hypocrite. (Time expired)1245122:45:0012451Baird, Bruce, MPMr BAIRDMP6CookLP10—Four-times Olympic swimming gold medallist Murray Rose inspired many Australians in 1956 and 1960 to strive to realise great goals. While he was a very successful athlete, he was a great sportsman and remains easily identifiable with the Olympic ideal which is simply `to take part'. Today he is still committed to this ideal through his work as patron of the Rainbow Club. I rise tonight to commend the contribution made by the club to the lives of children with disabilities by allowing them to take part in society. The Rainbow Club makes a real difference in the lives of children with disabilities by giving them the chance to socialise with others, to experience club membership and to achieve goals—opportunities which would be taken for granted by people without the same disabilities.The club achieves this by running sporting and other recreational activities for children and their parents. The Rainbow Club provides every member with a sense of belonging which is made difficult in the broader society because of their disabilities. The club's main activity is swimming, but picnics, sailing and horse riding are amongst the many other activities offered. We expect our state governments to ensure that basic services are provided and the Commonwealth to provide income support for people with disabilities. Private organisations like the Rainbow Club provide the quality of life.The club was funded by Ron Siddons in 1969 to provide swimming tuition for children of varying disabilities. The first Rainbow Club was formed in Cronulla, in my electorate, in 1986. Ron Siddons's ultimate goal was to establish Rainbow Clubs running all over Sydney by the turn of the century—a goal which has been reached with clubs also in Bondi, Campbelltown, Epping, Liverpool, Lindfield and Sutherland.The Rainbow Club provides activities for about 300 disabled children every week and benefits over 80 families in my electorate alone. I am proud to say that I am a board member of this fine organisation. Whilst the club network is primarily driven by Ron Siddons, a family of dedicated fundraisers, parents and a board of directors drawn from the commercial, accounting and legal professions also give of themselves for this worthy cause. The club takes care of fundraising for the parents, who are active decision makers at club level, and also provides those parents with a close network of friends who really understand the problems involved in their daily lives as carers.Ron Siddons is one of the true heroes of Australian society. He is a man who, many years ago as an inspector on the beach at Cronulla, recognised the problems of young people with disabilities—their inability to join with other young people, other children, in enjoying all that Sydney has to offer with its beaches and pools. He took the time to be with these children in the swimming pools, teaching them how to swim, how to enjoy some recreation in their lives and how to provide some respite to their parents. He showed their parents how to interact with the other parents who were experiencing similar problems in dealing with all types of problems, whether they were intellectual or physical disabilities, autism or whatever.In fact, seeing a whole group of them at play on Saturday morning was a very heart-moving experience. To see a whole range of Australians taking time out of their own schedules to help young Australians who do not have the advantages enjoyed by other children often at the same schools or in schools that these people would not be eligible to be part of and to see children out with their parents or with carers enjoying swimming and a range of many other activities is very heart-warming. I certainly commend Ron Siddons for the real Australian that he is, taking time out to show real care for young Australians with disabilities.1245222:50:0012452Andren, Peter, MPMr ANDRENKL6CalareIND00—Tonight I wish to draw some conclusions from the 6 November referendum so convincingly voted down by the Australian public. Both questions were fatally wounded by the process through which they were framed. The Constitutional Convention of 1998 was no people's convention at all. The resulting republic model won just 48 per cent support, yet the Prime Minister still went back on his word to hold a plebiscite on whether people preferred a directly elected president should the convention fail to reach a clear consensus and 70 per cent of Australians had consistently indicated they wanted to elect their own head of state should ties be cut with the Crown.The failure to test that wish at the ballot box was the ultimate deception of this deceitful agenda by the political establishment in this country, aided and abetted by a majority of the media, especially the Murdoch press. It is no good for Mr Beazley to now say we should have a plebiscite on cutting ties with the Crown or for other party politicians to find their democratic instincts in hindsight. The electorate wants its representatives to speak up fearlessly during the debate, not after it. Anyone in the street was saying the very first question that should have been asked was whether or not Australians wanted to sever ties with the Crown. Only after that was resolved could or should we have moved on to any discussion or any convention on what type of a republic the people preferred.But the establishment was never going to allow that and so we had this so-called bipartisan model, this two-party model, emerge from ConCon which deliberately suppressed the will of the people and was doomed to fail despite the huge corporate, union and media supported propaganda that tried to convince the electorate that this was a genuine republic on offer and that direct election was akin to anarchy. The Prime Minister cannot hide behind the result of 6 November by claiming it is a win for monarchists, anymore than the ARM can claim 45 per cent support for its model. What can be claimed is that a majority has not been fooled by the hype that this was the one and only republic chance of a millennium—the desperate argument of the major parties and their interests wishing to further concentrate executive power.Having cynically wasted all that effort and money, the government must now allow the plebiscite we have to have at the next election and, assuming that it confirms our wish to cut ties with the monarchy, move on to also confirming the wish for a directly elected head of state. Any directly elected model could quite simply contain narrowly codified powers or perhaps, as I favour, broader ones including presidential appointment of those umpires of good government, such as the Auditor-General, a commission against corruption and perhaps the tribunal charged with setting salaries and allowances of MPs and judges.Any preamble should wait until after this country decides what form of constitutional changes it wants. Then a new preamble can reflect that transition from constitutional monarchy to republic, but it must be a real preamble with legal force—a concise mission statement—not a bill of rights which, incidentally, should separately be the topic of further legislative and constitutional debate. A preamble is not needed until we paint the bigger constitutional picture, which should also include proper recognition of Aboriginal Australians in the body of the Constitution.The lessons of the last federal election, where more than 20 per cent of people voted for other than the parties represented in this House; of the New South Wales and Victorian elections, where an even larger percentage rejected the major parties; and now of these referendum results, point to one thing that the political establishment will continue to ignore at its peril—that is, the electorate will not accept an imposing from above of what the establishment patronisingly says is good for us, whether it be competition policy, selling off Telstra, banking deregulation, textbook free-trade theory or a republic model from the big end of town that has nothing to do with participatory democracy. People have had enough of not having a say.The greatest lesson of all is for the media, particularly the Murdoch press, which went into the trenches on this republic model and came a cropper. How deliciously ironic was it that Lachlan Murdoch, with his New York twang, dared to warn Australians about the dangers of continuing to allow a hereditary family to reign over us, when his own family dynasty has meddled far more in Australian public life than ever the Windsors might. How fitting it was to see the Murdoch propaganda rejected by the electorate.Yes, Mr Speaker, there were many lessons from 6 November but I suspect most of our political leaders and their masters at the top end of town will put their own spin on the result, deluding themselves that it was either a vote for the monarchy or a product of an uneducated, ignorant electorate. How wrong they are!1245322:55:0012453Barresi, Phil, MPMr BARRESIZJ6DeakinLP10—Earlier this year I had the good fortunate to visit Geneva, Switzerland, spending almost two days with the Salvation Army, visiting the local mobile needle exchange service and one of the Swiss health department's heroin distribution centres. The visit gave me an appreciation of the much lauded Swiss approach in dealing with that insidious of all social health problems—drugs.From this experience I came back convinced that the approach by this government through the Tough on Drugs initiative and the recently announced drug diversion program is a step in the right direction—a holistic approach which combines prevention, enforcement, education, rehabilitation and harm minimisation.I also came back committed to do whatever I could to assist those in our community who are working to help those crying out for help. Two initiatives have been commenced this year. The first, which I have already spoken about in this House, is a public forum I conducted in conjunction with Focus on the Family, at which more than 200 parents and concerned citizens attended. I trust there will be more. The second was the establishment of a drug advisory council. Last week I chaired the inaugural meeting of the Deakin Drug Advisory Council, which brings together a number of community professionals with extensive local knowledge on the issue of drugs.It is a great boon to the people living in Melbourne's east that there are some excellent services available to addicts and families of addicts who are trying to get clear from the grip of drugs. However, it is cruel that we should need these services at all, and crueller still that the demands placed on them mandate ever increasing efforts and budgets. However, that is the necessary price we pay in a compassionate and tolerant society.Today there are far greater numbers in our society who are seeking to understand the issues, and a greater willingness in our community to look for new solutions. Happily, the view expounded last week by the visiting TV junk jurist Judy Sheindlin—that we should `give them all dirty needles and let them die'—is recognised by most to be an argument devoid of both care and commonsense. In contrast, members of the Deakin Drug Advisory Council—or as it has been dubbed, DDAC—are rich in compassion, care and commonsense. DDAC members are making notable contributions in the areas of drug health and rehabilitation, education and enforcement. That they have agreed to be part of DDAC, which will advise me on the issues, is humbling indeed.The council consists of Bruce Argyle, the CEO of Regional Extended Family Services; Michael Waters, the Principal of Forest Hill College; Mike Marasco, the CEO of Maroondah City Council; Chief Inspector Alan Kennedy from the Knox District Police and Chair of the Eastern Drug Alliance; Peter Ruzyla, the CEO of Maroondah Social and Community Health; Professor John Rasa, the CEO of Box Hill Hospital; Reverend Alan Demond of Blackburn North Baptists; Sharon Turney of the Whitehorse Division of General Practice; and Peter Seamer, CEO of Whitehorse City Council, along with the soon to be appointed new CEO of the Maroondah Hospital.At its first meeting, the group identified a number of objectives, namely: to identify and communicate the regional strategic direction taken by local groups in dealing with drugs and drug related social problems; to identity priority areas of concern and unmet needs in drug enforcement, harm minimisation, prevention, rehabilitation and education, and to provide an assessment of the on-ground success of various programs in the eastern suburbs.Many of these existing programs have received significant funding from this federal government, and soon the new Victorian state Labor government will be testing the boundaries of community acceptance with a number of controversial proposals. I am reassured that safe dealing rooms is not one of them.Melbourne's East is indeed fortunate that under Chief Inspector Kennedy it has an alliance of community service providers and other key stakeholders working on specific regional strategies. The Eastern Drug Alliance is due to bring down its much awaited report in February next year. DDAC will not attempt to replicate the role of the Eastern Drug Alliance. It is strictly an advisory body to a federal member of parliament.With its membership including representatives from areas such as law enforcement, education and rehabilitation, DDAC is well placed to assess the types of initiatives often introduced or proposed by governments. Receiving advice from the eminent members of DDAC will certainly give me a greater insight into the problems facing our addicts, their families and those who are trying to help them.From a personal point of view, I would hope that, through DDAC, we will be able to lift the `collective social morale' about this issue. Too often members of the public may be excused for thinking that little is happening, but that is not the case. Through DDAC and the programs conducted by many of our excellent service providers, I would like to assure the community that all is not lost in our fight to help those who need it.10000SPEAKERMr SPEAKER—Order! It being 11 p.m., the debate is interrupted.House adjourned at 11.00 p.m.Notices12454The following notices were given:Mr Truss to present a bill for an act to amend the Farm Household Support Act 1992, and for related purposes.Mr Williams to present a bill for an act to amend the Criminal Code Act 1995, and for other purposes.Mr Williams to present a bill for an act to amend the Criminal Code Act 1995.Mr Williams to present a bill for an act to amend the National Crime Authority Act 1984, and for related purposes.Mr Williams to present a bill for an act to amend Customs legislation to provide for special criminal sanctions in respect of the import or export of certain goods, and for other purposes.Mr Entsch to present a bill for an act to repeal the Gladstone Power Station Agreement Act 1970.Mr Anderson to present a bill for an act to amend the Albury-Wodonga Development Act 1973, and for other purposes.Answers to Questions in Writing12455The following answers to questions were circulated:12455(Question No. 946)94612455Andren, Peter, MPMr AndrenKL6CalareIND00 asked the Minister for Veterans' Affairs, upon notice, on 29 September 1999:(1) Are surviving members of the 55th Australian Composite Anti Aircraft Regiment eligible for a service pension and Gold Card; if not, why not.(2) Were these servicemen accepted for active service in 1943 and was their war-service in an area that had been subject to enemy attack; if so, is their war service regarded as active service; if not, why not.(3) Was northern Australia, particularly the Northern Territory, an enemy target throughout World War II.(4) Will the Government reconsider service pension entitlements to the 55th Australian Composite Anti Aircraft Regiment; if not, why not.12455Scott, Bruce, MPMr Bruce ScottYT4MaranoaNPVeterans' Affairs; Minister Assisting the Minister for Defence10—The answer to the honourable member's question is as follows:(1) Surviving members of the 55th Australian Composite Anti Aircraft Regiment are not eligible for a service pension in respect of their service in that regiment, because this service is not qualifying service as defined in the Veterans' Entitlements Act 1986. However, they may be eligible for service pension for other periods of service which are classified as qualifying service under the Act. They are also not eligible for the Gold Card under the extension provisions, effective from 1 January 1999, as their service in that regiment is not qualifying service. They may, however, have Gold Card eligibility if they are receiving a service pension in respect of other periods of service and they satisfy the income and assets tests for treatment purposes, or if they are receiving a disability pension at or above 100% of the general rate.(2) Yes. With respect to World War II, active service referred to overseas service between 1939 and April 1942 and from then, service both within Australia and overseas until 1945. Therefore, not all veterans on active service incurred danger from hostile forces of the enemy. The term "active service" does not appear in the Veterans' Entitlements Act 1986 and is quite different from "qualifying service" which is the main eligibility criterion for service pension. Qualifying service has always meant that the person served in a theatre of war or has incurred danger from hostile forces of the enemy.The 55th Australian Composite Anti Aircraft Regiment was based in Townsville from October 1943 and then at Batchelor, near Darwin, in the Northern Territory from November 1943. Although both of these areas were subject to enemy attacks there were none during the periods when the regiment was based there. Hence the criteria for qualifying service cannot be satisfied.(3) Yes. There were 64 air raids on Darwin. The first two occurring on the same day,19 February 1942 and the last on 12 November 1943. There were a further 29 air raids on northern Australia (which includes north Western Australia and north Queensland), two of which were in the Northern Territory, at Katherine on 22 March 1942 and at the Drysdale Mission on 27 September 1943.(4) No. Policy on qualifying service has remained consistent since its inception in 1935 and the Government has no plans to change the current provision.12455(Question No. 950)95012455Crean, Simon, MPMr CreanDT4HothamALP00 asked the Treasurer, upon notice, on 30 September 1999:(1) Does the regulation Impact Statement for the Goods and Services Tax legislation claim that the number of Australian businesses that will be required to seek an Australian Business Number (ABN) is 1.4 million, rising to 1.6 million in 2001-02; if so, is this still the case.(2) Is he aware that the Parliamentary Secretary to the Minister for Communications, Information Technology and the Arts stated that up to 2.5 million Australian businesses will have an ABN by July 2000.(3) What is the reason for the apparent discrepancy in the estimated number of businesses which will be registered for an ABN.(4) What is the aggregate compliance cost impact of the extra registrations. 12456Costello, Peter, MPMr CostelloCT4HigginsLPTreasurer10—The Assistant Treasurer has provided the following answer to the honourable member's amended question:(1) The Regulation Impact Statement for the Goods and Services Tax (GST) legislation refers to the number of GST registrations that are expected. It states at Part C.1: "It is estimated that in the first year of operation there will be 1,400,000 GST registrations. The numbers are expected to grow by about 200,000 in the following year."and at Part D.2 that: "It is estimated that there will be 1.6 million registrations in 2001-02."These estimates refer to GST registrations only, which is a subset of the much larger number of entities that are expected to apply for an Australian Business Number (ABN).The figure for the number of GST registrations estimated for the first year of operation has been revised to 1,500,000 registrations and the number is expected to grow by about 300,000 in the following year.(2) Such as statement would be in accordance with the most current Australian Taxation Office estimates for the number of expected ABN registrations based on the most recent information available.(3) The reason for the apparent discrepancy in the estimated number of businesses which will be registered for an ABN is that not all entities that apply for an ABN will register for GST.(4) For those registrants who choose to register for the purpose of enhancing their ability to deal in the future with the whole of government by using an ABN there will actually be compliance cost benefits.12456(Question No. 953)95312456Crean, Simon, MPMr CreanDT4HothamALP00 asked the Treasurer, upon notice, on 30 September 1999:(1) Did Australia's trade deficit grow in trend terms by more than $1 billion per month in each of the first seven months of 1999.(2) Is he able to say whether Australia's trade deficit grew in trend terms by more than $1 billion per month in each of the first seven months of (a) 1983, (b) 1984, (c) 1985, (d) 1986, (e) 1987, (f) 1988, (g) 1989, (h) 1990, (i) 1991, (j) 1992, (k) 1993, (l) 1994, (m) 1995 and (n) 1996.(3) Has Australia's monthly trade deficit exceeded $1 billion in trend terms prior to 1999; if so, (a) on how many occasions and (b) when. 12456Costello, Peter, MPMr CostelloCT4HigginsLPTreasurer10—The answer to the honourable member's question is as follows:(1) No.(2) (a) to (n) Australia's trade deficit in trend terms did not grow by more than $1 billion per month in any month in the years 1983 to 1996.(3) See ABS publication, catalogue no. 5368.0.12456(Question No. 954)95412456Crean, Simon, MPMr CreanDT4HothamALP00 asked the Treasurer, upon notice, on 30 September 1999:(1) What, if any, statistical validity is there in measuring the current account deficit in dollar terms per hour.(2) What validity is there in measuring foreign debt on a per person basis.12456Costello, Peter, MPMr CostelloCT4HigginsLPTreasurer10—The answer to the honourable member's question is as follows:(1) and (2) The ABS does not provide measures of current account deficit per hour or foreign debt per person in its publications. The ABS has also advised that such measures are not proposed in international standards or used by other major statistical offices.12456(Question No. 966)96612456Ferguson, Laurie, MPMr Laurie Ferguson8T4ReidALP00 asked the Minister for Foreign Affairs, upon notice, on 12 October 1999:(1) What percentage of Australia's 1999-2000 Aid Budget will be devoted to Micro Credit efforts.(2) How many families will be assisted by these ventures.(3) Has Australia adopted income assessment criteria to determine the proportions of especially poor families affected by the program.12456Downer, Alexander, MPMr Downer4G4MayoLPForeign Affairs10—The answer to the honourable member's question is as follows:(1) On current estimates approximately 0.3 per cent of Australia's 1999-2000 aid budget will be devoted to microfinance activities.(2) Project documentation indicates that approximately 47,000 households will be assisted by microfinance programs funded by the Australian aid program in 1999-2000. This figure includes households whose members will receive training to assist them to participate in a microfinance scheme. It does not include households which will indirectly benefit from Australian assistance designed to strengthen the capacity of in-country microfinance organisations to provide credit and other financial services to the poor on a long-term basis. (3) Australia has not formally adopted income assessment criteria to determine the proportion of especially poor families affected by its microfinance programs. As part of its increased microfinance focus, the aid program will develop a more detailed database that will include information on the poverty level of the clients of the microfinance programs it supports.12457(Question No. 986)98612457Ferguson, Martin, MPMr Martin FergusonLS4BatmanALP00 asked the Minister for Immigration and Multicultural Affairs, upon notice, on 13 October 1999:(1) How many parent migration applications under the parent arrangements (offshore subclass 113 and onshore subclass 819) were there at the time the Senate disallowed the arrangements on 31 March 1999.(2) From which countries were the applications and how many were there for each country.12457Ruddock, Philip, MPMr Ruddock0J4BerowraLPImmigration and Multicultural Affairs; Minister Assisting the Prime Minister for Reconciliation10—The answer to the honourable member's question is as follows:(1)—(2) The following table shows the number of applicants in the Parent visa subclasses 113 and 819 by country of citizenship as at 31 March 1999.Parent (subclasses 113 and 819)—Applicants by country of citizenshipCountrySubclass 113 OffshoreSubclass 819 OnshoreTotalPRC8711621,033United Kingdom5609569South Africa2294233India1057112Sri Lanka62567Other46453517TotaL2,2912402531Source: DIMA MPMS and RESI2 data12457(Question No. 997)99712457Theophanous, Andrew, MPDr TheophanousQJ4CalwellALP00 asked the Minister for Immigration and Multicultural Affairs, upon notice, on 13 October 1999:(1) Will he provide a table showing the change that has occurred in the proportions of the various immigration categories since 1987.(2) Has there been a significant reduction in the Extended Family Reunion and Parent categories relative to Independent categories.(3) Has his attention been drawn to the social consequences of a significant change in the balance between the categories; if so, what research has his Department carried out on this issue.(4) Will he act to re-balance the immigration program by providing a fair share for the family reunion categories; if not, why not.12457Ruddock, Philip, MPMr Ruddock0J4BerowraLPImmigration and Multicultural Affairs; Minister Assisting the Prime Minister for Reconciliation10—The answer to the honourable member's question is as follows:(1) See table below.(2) By "extended family reunion" categories, it is assumed to mean all family categories except Spouses/Fiances, Dependent Children and Parents but including the previous Concessional Family category and the Skilled-Australian Linked category.On that basis, there has been a decline in the "extended family reunion" and Parents categories, relative to the Independent category over the period 1987-88 to 1998-99. This decline occurred substantially between 1987-88 and 1991-92. The relativity between these categories then fluctuated around a slightly higher figure for the rest of the period. The exception was 1995-96 when the proportion of Parents in the program jumped while the proportion of Independents slumped.What the table in response to part (1) of this question also shows is that, in the period 1992-93 to 1995-96, the family reunion component of the program became out of balance with the Independent category and the Skill Stream more generally.(3) The Government is committed to an immigration program that is in the national interest and one that has broad community support. Under the previous government, the Family Stream was allowed to dominate the Migration Program in a way that compromised the Program's contribution to the Australian economy and eroded community confidence in the Program. Against this background, the Government acted quickly to re-balance the Program through increasing the emphasis on skilled migration. The improved focus on skills helps to ensure that migrants contribute to, and share in, Australia's growth and that immigration is serving, in a balanced way, the goals of immigration policy in relation to Australia's economic, social, humanitarian and environmental interests.The Department has undertaken an extensive research project in the form of the Longitudinal Survey of Immigrants to Australia (LSIA), which is the most comprehensive survey of immigrants ever to be undertaken in Australia. It is designed to collect and disseminate information about over 5000 migrants and accompanying family members who arrived in Australia between September 1993 and August 1995. Data collected reflects migrants' experiences of settlement in Australia over a period of time, from their pre-migration arrangements through until three years after their arrival. In broad terms, the aim of the survey is to provide Commonwealth and other agencies with reliable data with which to monitor and improve immigration and settlement policies, programs and services.The sample for the survey was designed to enable comparison of immigration and settlement experiences by major migrant eligibility category (which were at time of survey design: preferential family; concessional family; business skills and employer nomination; independent and humanitarian) and also by about 50 regions or countries of birth.The questionnaire covers a wide range of topics and includes questions on:. demographic characteristics . health. perceptions of Australia . general and social support. views on immigration . financial support. citizenship . sponsorship activity. English proficiency/learning . household budget. qualifications assessment . overseas assets/transfers. study and training . changes of residence. labour force status . return migration.. dwelling typeBasic demographic information is collected on all members of the household, regardless of whether they were immigrants.A second Longitudinal Survey of Immigrants to Australia (LSIA) is under development, with information to be collected from around 3 000 primary applicants, arriving between September 1999 and August 2000. Comparisons with data from the first LSIA will allow other effects of policy changes introduced by this Government to be evaluated. The second LSIA is also designed to enable comparisons between migrant eligibility categories (visa types) at a finer level of detail than the first LSIA.A recently released report prepared by ACIL Consulting, titled Impact of Migrants on the Commonwealth Budget, indicates that from their first year in Australia the overall impact on the Commonwealth Budget of people arriving under the Migration Program is positive and this positive impact increases substantially over time. This good outcome is a result of the large positive impact of the Business and Independent skilled categories from their first year after arrival. This reinforces the Government's decision to focus on skilled migration. Chris Murphy of Econtech has estimated that the increased emphasis on skill will provide a $134 per capita improvement in living standards by 2007-08.The Department is also funding CSIRO to undertake work on the Australian Stocks and Flows Framework model, which was constructed by the CSIRO as part of its efforts to develop a system of national accounts in physical terms, to complement the national economic accounts. The CSIRO claims that the ASFF provides the first integrated overview of the long-term physical consequences of our economic and social choices.A series of workshops are being held in 1999 in which a range of experts will examine and validate the assumptions of the model. Following this, the model will be used to examine the effect of three different population levels on a set of physical, social and demographic indicators to the year 2051. These results will be made publicly available.(4) The question is based on a false premise that the Migration Program does not provide a fair share for family reunion. The actions this Government has taken have been designed to bring back into balance a program which was dominated by family reunion during the last four years of the previous Government. The current Family Stream provides places for around 47% of the Migration (non-Humanitarian) Program. Year87/8888/8989/9090/9191/9292/9393/9494/9595/9696/9797/9898/99Family%%%%%%%%%%%%Preferential33.237.036.634.638.155.453.848.159.050.446.747.1Spouses/Fiances13.115.024.121.826.640.940.034.140.734.038.440.8Parents8.89.39.19.27.37.87.26.710.810.21.64.6Dependent Children1.61.81.71.82.24.04.03.33.43.03.33.0Other preferential0.91.01.71.82.02.52.74.04.23.13.33.1Unallocated*8.89.9----------Concessional (a)31.821.218.820.018.311.315.010.19.79.9--Total Family65.158.355.454.656.566.768.858.268.760.346.747.2SkillEmployer Nominations(b)6.87.49.96.75.77.16.44.35.67.58.98.3Business Skills(c)6.08.28.86.26.34.93.03.15.97.98.09.0Special Talents0.10.10.20.10.20.30.30.10.20.22.70.3Independents19.621.224.931.329.719.118.819.612.820.319.820.1Unallocated2.02.2----------Skilled-Australian Linked (a)----------14.213.61Nov- Onshore0.812.54.61.30.50.3Total Skill34.441.043.844.441.931.3429.139.729.237.351.751.5Special Eligibility0.50.60.71.11.72.12.12.12.12.31.71.3Total Program100.0100.0100.0100.0100.0100.0100.0100.0100.0100.0100.0100.0Please note that figures have been rounded and total may not be the exact sum of the components. They exclude humanitarian entry data.The program outcomes and components comprise the number of visas granted and those granted permanent resident status in Australia after arrival. Figures include Grant of Resident Status (GORS) and, from 1989-90, also include people granted resident status under Permanent Entry Permit After Entry (PEPAE). There is no eligibility for PEPAE under the Concessional Family and Independent categories.(*) Estimated GORS/PEPAE approvals. These figures were not attributed to sub-components until 1989-90.(a) From 1997-98, Concessional Family was known as Skilled-Australian Linked Category and was shifted from the Family Stream to the Skill Stream on 1 July 1997 following major changes to the eligibility criteria focusing more on employability factors(b) Includes Employer Nomination Scheme (ENS), Labour Agreements and Regional Sponsored Migration Scheme (RSMS).(c) Business Migration Program changed to Business Skills during 1991-92.12459(Question No. 998)99812459Danby, Michael, MPMr DanbyWF6Melbourne PortsALP00 asked the Minister for Immigration and Multicultural Affairs, upon notice, on 14 October 1999:(1) How many of the Kosovar refugees remaining in Australia fled Eastern Serbia into Kosovo.(2) Will those refugees be forced to return to Kosovo.(3) If not, will they be forced to return to Serbia; if so, have inquiries been made about where those persons will live once returned.(4) Has the Government received approaches from any State Government to let these and other Kosovo refugees remain in Australia. (5) Do Kosovo refugees remaining in Australia have the right to request ministerial discretion to allow them to stay in Australia if they have reasonable fear for their lives if returned to Kosovo or Serbia.12459Ruddock, Philip, MPMr Ruddock0J4BerowraLPImmigration and Multicultural Affairs; Minister Assisting the Prime Minister for Reconciliation10—The answer to the honourable member's question is as follows:(1) I do not have any information about how many of the Kosovar evacuees remaining in Australia fled Eastern Serbia into Kosovo. The Kosovar evacuees who came to Australia were selected from camps in Macedonia. I am aware that some of the Kosovars who came here said, after they had been in Australia for some time, that they were from Serbia. I do not know how these people who said they were from Serbia came to be in the Former Yugoslav republic of Macedonia. The majority of the Kosovars who said they were from Serbia have now returned to Kosovo.(2) All the evacuees agreed to return to Kosovo when it was secure to do so. At this stage all the Kosovar evacuees who have returned to Kosovo have done so voluntarily.(3) I do not intend to return any of the Kosovar evacuees to Serbian controlled territory.(4) The Premiers of Victoria and Tasmania have both written to me asking for the Kosovar evacuees to be allowed to remain in Australia.(5) Yes, the legislation passed by the Australian Parliament that provided for a temporary stay for the Kosovar evacuees put a legislative bar on applications for any other type of visas while the Kosovars remained in Australia. However, the legislation allows me to lift that bar in individual cases where it is in the public interest to do so. If I were to lift that bar for certain individuals they would still need to qualify for another class of visa. I have invited all remaining Kosovars to set out any reasons they have for wanting to stay in Australia longer so that individual circumstances can be properly considered on their merits. I must add that, to date, I have not heard a single compelling reason why any of the Kosovars in Australia should be granted ongoing protection in Australia when NATO forces have established an improved level of security in Kosovo.12460(Question No. 999)99912460McFarlane, Jann, MPMs Jann McFarlane83CStirlingALP00 asked the Treasurer, upon notice, on 14 October 1999:(1) Will the Government allow tax deductions for gifts of goods in kind donated by Australian businesses to aid the rebuilding of infrastructure in East Timor; if so, what deductions will be available.(2) Will the Government waive the purchase within 12 months condition on deductions for gifts of a goods in kind nature sent to East Timor by Australian businesses.12460Costello, Peter, MPMr CostelloCT4HigginsLPTreasurer10—The Assistant Treasurer has provided the following answer to the honourable member's question:(1) There are already a number of overseas aid funds approved under the income tax laws providing relief in East Timor.Where a business makes a donation of property to one of the approved overseas aid funds a deduction will be allowable. The amount of the deduction will depend on the type of property donated.Where the business donates an item of trading stock of the business which is disposed outside the ordinary course of the business, a deduction will generally be allowable for the market value of the property on the day the gift is made.Where the property donated is not trading stock of a business, a deduction will generally be allowable for the lesser of the market value of the property on the day the gift is made or the amount paid for the property.(2) The `purchase within 12 months condition', will not be waived.However, under the new philanthropy measures announced by the Prime Minister on 26 March 1999 and contained in Taxation Laws Amendment Bill (No. 8), from 1 July 1999 any property valued by the Commissioner of Taxation at more than $5,000 will not need to satisfy the 12 month rule.In addition, the 12 month rule does not generally apply to donations of trading stock disposed of outside the ordinary course of business.12460(Question No. 1000)100012460McFarlane, Jann, MPMs Jann McFarlane83CStirlingALP00 asked the Minister for Foreign Affairs, upon notice, on 14 October 1999:(1) Have any aid organisations been deemed as approved organisations under the developing country gift deduction arrangements for relief work in East Timor; if so, what are the contact details for those approved organisations.(2) Will the Government provide relief funding for the rebuilding of infrastructure in East Timor; if so, will the funding be directed to existing aid organisations or will the Government provide relief direct to the population of East Timor.12460Downer, Alexander, MPMr Downer4G4MayoLPForeign Affairs10—The answer to the honourable member's question is as follows:(1) Under the Overseas Aid Gift Deduction Scheme (OAGDS), the Government approves organisations which meet criteria that establish the relief and development credentials of the organisation. The Treasurer then approves specific funds established for relief of persons in declared developing countries. The Government does not monitor where the organisations that have tax-deductibility spend their donations. Tax-deductible funds have been approved that allow NGOs to work in a number of developing countries using donated monies. The Australian Council for Overseas Aid (ACFOA) maintains a list of NGOs with tax-deductibility that are working in Timor on its website (www.acfoa.asn.au). On its website ACFOA notes that tax deductible cash donations are being accepted by many NGOs including the following, all of which are Government accredited: Non-Government OrganisationTelephone NumberWebsiteADRA Australia1800 242 372www.adra.org.au APHEDA (Union Aid Abroad)1300 362 223AFAP/Timor Aid1800 007 308www.afap.org AUSTCARE1800 244 450www.austcare.org.au Australian Baptist World Aid(02) 94511199Australian Red Cross1800 811 700www.redcross.org.au Australian Volunteers International(03) 9279 1788www.ozvol.org.au CARE Australia1800 020 046www.careaustralia.com.au Community Aid Abroad-Oxfam in Australia1800 034 034 www.caa.org.au Caritas Australia1800 024 413www.caritas.org.au Christian Children's Fund1800 023 600National Council of Churches in Australia1800 025 101Opportunity International Australia1800 812 164www.opportunity.org.au Medecins Sans Frontieres1800 063496World Vision13 32 40www.wvi.org/aus UNICEF Australia1800 025 192www.unicef.org.auThe Minister for Foreign Affairs has included East Timor in the List of Declared Developing Countries and Territories for the purposes of the OAGDS.(2) Australia has provided $14 million for humanitarian relief to East Timor since August 1999. This early assistance in providing emergency relief goods and logistical support has been critical to a quick and effective response to the humanitarian needs of the East Timorese.As international agencies specialising in relief and development work are able to carry out de tailed assessments of humanitarian and development needs, the Government will consider making further assistance available. This is likely to include funding for the rebuilding of infrastructure in East Timor and support to a range of areas such as health, education, governance, agriculture and rural development.Australia's future humanitarian support for East Timor is likely to be through a combination of international trust funds, direct bilateral assistance, funding of UN agencies, local, Australian and international NGOs, as well as various East Timorese church and community groups.