2002-06-194012REPS377702002-06-19—————The SPEAKER (Mr Neil Andrew) took the chair at 9.30 a.m., and read prayers.Bills3777R15203777Bill presented by Mr Slipper, and read a first time.377709:31:003777Slipper, Peter, MPMr SLIPPER0V5FisherLPParliamentary Secretary to the Minister for Finance and Administration10—I move:That this bill be now read a second time.The Customs Legislation Amendment Bill (No. 1) 2002 contains amendments to the Customs Act 1901, the Customs Legislation Amendment and Repeal (International Trade Modernisation) Act 2001 and the Passenger Movement Charge Collection Act 1978.The bill continues the process of harmonising customs offences with the Criminal Code; restores the way imported goods are valued to make it consistent with Australia's international trade obligations; improves customs border security measures by allowing seizure of certain goods in the Torres Strait and providing for simplified reporting of re-mail; and makes a number of amendments as a result of the Customs Legislation Amendment and Repeal (International Trade Modernisation) Act 2001.The bill also makes minor changes to the exemptions available under the Passenger Movement Charge Collection Act.First, the bill contains amendments to offence provisions in the Customs Act to make them consistent with amendments to other customs offences made by the Law and Justice Amendment (Application of the Criminal Code) Act 2001.The amendments will ensure that, where a fault element is not required, offences are expressly described as strict liability offences.The amendments will also redraft some offences to clarify that an exception to the offence is not an element of the offence to be proved but can be raised as a defence.The bill also provides for amendments to ensure consistency in the way financial penalties are expressed in the Customs Act by replacing references to dollar amounts with the equivalent penalty units.The next set of amendments deals with the provisions for determining the customs value of imported goods for the purposes of assessing the duty payable.The full Federal Court in CEO of Customs v. AMI Toyota Ltd held in September 2000 that the warranty component of the price paid for imported vehicles should be deducted from the customs value for the purpose of assessing duty.The government considers that decision to be inconsistent with the World Trade Organisation Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994, to which Australia is a party.The WTO valuation agreement requires the customs value of imported goods to be the total of payments made for the goods, with specific exceptions. Those exceptions do not cover payments for warranty costs.The reasoning of the full Federal Court is potentially applicable to the valuation of a wide variety of goods.The amendments will align the government's policy objective with the WTO valuation agreement by clarifying that the warranty component of the price paid for imported goods is included in the customs value.A transitional provision included in the bill ensures that these amendments affect only the valuation of goods entered for home consumption after the date of commencement of the amendments.The next set of amendments will insert a power to seize without warrant prohibited imports and prohibited exports found on board certain vessels in the Torres Strait Protected Zone established under the Torres Strait Treaty 1978.Traditional inhabitants of the Torres Strait using vessels in the conduct of traditional activities in the Torres Strait Protected Zone do not have to comply with the normal customs reporting requirements when travelling between Papua New Guinea and Australia.However, to maintain control over the movement of prohibited imports and prohibited exports into and out of Australia, Customs officers intercept and board these vessels.Under current legislation, if prohibited goods are found on a vessel, an application for a seizure warrant must first be made to a magistrate.This poses considerable operational and safety problems until the warrant is obtained.The amendments will allow for the seizure of prohibited imports and exports without a warrant in these circumstances.Customs has consulted with and received support from the Torres Strait Regional Authority for this proposal.The bill also proposes to amend the cargo reporting provisions for simplified arrangements for the reporting of cargo known as `re-mail'.Re-mail relates to bulk business mail such as periodic newsletters, bank statements and subscription publications.The nature of re-mail items, as defined, is such that the potential for them to harbour prohibited goods is low.To require standard customs reporting of detailed data for this class of mail is considered unnecessary.It is therefore proposed to amend the act to enable a person who registers as a re-mail reporter to provide fewer details for the report of re-mail cargo. The bill also contains amendments to the Customs Legislation Amendment and Repeal (International Trade Modernisation) Act 2001.The provisions of that act are to commence by proclamation within a two-year period dating from royal assent.The trade modernisation act received royal assent on 20 July 2000; therefore all provisions must commence by 20 July 2003.Many provisions of the trade modernisation act depend directly or indirectly on the introduction of Customs's new cargo management computer system—the integrated cargo system.The two-year `proclamation period' was to allow sufficient time for the trading community to be ready for the procedural and computer system changes that the amendments support.However, since enactment it has become apparent that the trading community may not be ready to use the integrated cargo system by July 2003.To avoid uncertainty for industry, the bill therefore allows up to a further one year (until 20 July 2004) for the relevant provisions to commence.The bill also amends the trade modernisation act to allow the repeal of the provisions in the Customs Act that govern the operation of Customs's current cargo management computer systems to commence on different days.Currently the trade modernisation act requires all those provisions to be repealed on the same day. Given the scale of change involved in the replacement of the current systems with the integrated cargo system, Customs intends, in consultation with industry, to introduce the new system in a phased manner. The bill also includes some minor and technical amendments to the trade modernisation act, the majority of which are to more closely align some of the provisions to the development of the new computer systems.Finally, the bill clarifies an existing exemption to the passenger movement charge as it applies to persons making more than one departure from Australia while on a journey that incorporates both air and sea legs.The bill also extends the exemption from the passenger movement charge to the small number of persons covered under the Overseas Missions (Privileges and Immunities) Act 1995.I commend the bill to the chamber and present the explanatory memorandum.Debate (on motion by Dr Lawrence) adjourned.Bills3779R15443779Bill presented by Mr Slipper, and read a first time.377909:40:003779Slipper, Peter, MPMr SLIPPER0V5FisherLPParliamentary Secretary to the Minister for Finance and Administration10—I move:That this bill be now read a second time.The main purpose of this bill is to continue the imposition of the import processing charges imposed by the Import Processing Charges Act 1997 which is to be repealed by the Customs Legislation Amendment and Repeal (International Trade Modernisation) Act 2001.The trade modernisation act introduces substantial new import reporting and entry processes under the Customs Act 1901 as part of the integrated cargo system.The charges for these new reporting requirements are contained in the Import Processing Charges Act 2001.It was intended that the repeal of the 1997 charges act and the new processes would commence on a day to be fixed by proclamation and, if the provisions were not proclaimed, they would commence automatically two years after the trade modernisation act received the royal assent.Many provisions of the trade modernisation act depend directly or indirectly on the introduction of Customs's new integrated cargo system.The two-year proclamation period was to allow sufficient time for the trading community to be ready for the procedural and computer system changes.Since the trade modernisation act was enacted, it has become apparent that industry would not be in a position to implement its computer system changes by July 2003.The Customs Legislation Amendment Bill (No. 1) 2002 will extend the time in which those provisions can be proclaimed to commence to three years to allow the trading community the extra time it would need to be ready.This bill ensures that the 1997 charges act will continue to apply in respect of import reports and processing made under the old systems.These charges will continue to apply until all of the new import reporting and entry processes have commenced.The bill also continues the imposition of charges for documentary cargo reports made during the six months general moratorium period, or any further moratorium period granted by the Chief Executive Officer of Customs.I commend the bill to the House and present the explanatory memorandum.Debate (on motion by Dr Lawrence) adjourned.Bills3779R15573779Debate resumed from 18 June, on motion by Mr Slipper:That this bill be now read a second time.09:43:003779Latham, Mark, MPMr LATHAMK26WerriwaALP00—Last night in addressing the House I was explaining Labor's concern about the lack of detailed information on the accelerated depreciation provisions in the Taxation Laws Amendment Bill (No. 4) 2002. I foreshadow now that Labor will be moving in the Senate that the bill be referred to a legislation committee where we can get the kind of information that is needed. Within this quite reasonable level of scrutiny there is no reason the bill still cannot take effect from 1 July. So we want more information but we do not believe that this process will delay the implementation of the legislation. Labor will not be opposing the passage of the bill through this House. We are not opposed to the thin capitalisation provisions and the trust to company rollover provisions of schedules 1 and 2 of the legislation. The opposition is completely opposed to the government's $50 million tax cut for rich foreigners and we will move an amendment in the Senate to remove that tax cut. We will also move the amendment in the House.Finally, in regard to the effective life caps, we will support a reference to the Senate legislation committee so that these very expensive proposals for $1.9 billion in tax expenditure over 10 years can be exposed to a reasonable level of scrutiny. Our main concern is about the accountability of the government to the House. Part of that concern is the fact that the member who takes carriage of this legislation for the government has no responsibility for Treasury measures or taxation. As we have just seen in the House, the member for Fisher, the Parliamentary Secretary to the Minister for Finance and Administration, introduces and takes through the House all the taxation measures, but he is not a member of the executive who has responsibility for taxation matters. He is not a parliamentary secretary to the Treasurer; he is a parliamentary secretary to a different minister altogether. This makes it very frustrating for the opposition. We are not able to get the detailed information we need in the House because the government member taking the bill through has no responsibility for the legislation. He is just the messenger boy who introduces the legislation in the House and then reads out notes provided to him by other people. Consequently, we find it very hard to get detailed information about these taxation provisions. This is just another abuse, another lowering of parliamentary standards, by the government.One would have thought that the government would at least have the decency on major tax bills such as the Taxation Laws Amendment Bill (No. 4) 2002 to ensure that the Treasurer, who has responsibility for tax policy, is in the House for the debate during the consideration in detail process and provides the information needed for proper executive accountability. That is our frustration on this matter. It is not surprising, therefore, that we will need to move this provision to a Senate legislation committee, so that these very important matters can be given full scrutiny and accountability by the parliament.It is a sad thing that the House of Representatives is unable to give bills proper scrutiny and needs to rely on the Senate—a place that is not democratically elected, as we are—to provide that level of scrutiny and accountability for the parliament. I urge the government in the future to ensure that the Treasurer takes carriage of these bills and fulfils his responsibility to the Australian people and to the parliament to explain to us taxation issues on a piece of taxation legislation. The parliamentary secretary might have some response to this. He has debated it in the past, but I would like to quote words from the government itself pointing out that Mr Slipper has no responsibility for Treasury matters. A report in the Daily Telegraph on 22 April concerning Senator Coonan, the Assistant Treasurer, when addressing a fundraising function for the Liberal Party, states:... the Government's bean-counting business was based on the three Cs.There was parliamentary secretary to the Treasurer Ian Campbell, who was Little C, then Senator Coonan herself who was Middle C. And of course, she said, there was Treasurer Peter Costello, the Big C.As the assembled business observers variously sniggered or sat open-mouthed, Costello joined the former.That explains, he said, why ministers called him a Big C when he cut their spending during Budget preparations.No doubt this was a reference to him being the Big Cheese of the Budget production process.From the words of the government itself, it is very clear that Treasury ministers with responsibility for economic matters including taxation are all Cs. That is what Senator Coonan has said—there is a little C, a middle C and a big C. They are all Cs of one description or another. I am the last person who would want to anoint the member for Fisher and call him a big S, but we need to ask why he is not part of this arrangement within the government to have carriage of economic matters through the House. It frustrates the proper accountability and role of the House of Representatives. Labor is not opposed to this bill, but we are frustrated to the extent that we do not have detailed information about the accelerated depreciation provisions. We do not know whether money is being allocated sector by sector. We do not know whether it is going to gas and oil production. We do not know whether it is part of the provision for aeroplanes and helicopters. One would have thought, when we are spending such large amounts of public money, that this information would be readily available to the people's house, the House of Representatives. For this reason, we are going to seek processes in the Senate to get more detailed information. We will see what happens at that point, but it may well be that the bills will need to come back to the House for further consideration.10000SPEAKER, TheThe SPEAKER—Without taking, in any sense, issue with the comments made by the member for Werriwa, whose statements were consistent with statements he had made earlier in the House, I point out for the benefit of all members and for the Hansard record that the use of quotations does not, of itself, facilitate the use of unparliamentary language, as revealed in House of Representatives Practice at page 489. 09:05:003781Tollner, David, MPMr TOLLNER00AN4SolomonLP10—For the most part, the changes proposed in the Taxation Laws Amendment Bill (No. 4) 2002 are consequential. In the case of PAYG, they involve withholding amounts, tidying up after the coalition government's broad ranging taxation reforms, which have made this country's business tax laws modern and competitive in the 21st century. The first four amendments prevent multinationals from laying off debt on Australian operations in order to maximise their tax bills; allow greater flexibility for business in setting up a business structure that best suits them; make tax on foreign earnings from overseas assets for temporary residents fairer; and fix up some of the anomalies over PAYG withholding amounts and the ability of the Commissioner of Taxation to recover unpaid amounts. Notwithstanding an understandable general public aversion to tax in any form, these amendments will be broadly welcomed by a few who are directly affected and will be broadly ignored by the great majority who find the detail of tax reform as interesting as warm beer and cold chips.There is one amendment which, unlike the others, which have been predicated over years and months, has arrived without great fanfare but has considerable significance for the constituents of my electorate. It is about this amendment to taxation laws that I will now speak. That amendment concerns statutory caps to be placed on the effective life of certain named assets, for the purposes of depreciation. Those named assets are planes, helicopters and, significantly in the context of the constituency of Solomon, assets used in gas transmission and distribution and in oil and gas production.My constituents, the citizens of Darwin and Palmerston, are younger than, play harder than and speak more plainly than the national average. It is my duty, therefore, to speak plainly on their behalf. Their expectation is that the Territory will live up to its marketing slogan `The difference is opportunity'. They expect there to be jobs for their kids. My constituents tell me that they want and expect Timor Sea gas to come onshore, but that everyone—the oil companies and governments—is dickering around. I can understand their concern because, when it comes to dickering people around, there are none better at it than those on the other side of this House. There is no better example of their on again, off again approach than this budget measure.In the past week, several areas of the media have reported Labor's Treasury spokesman, the member for Fraser, as recommending that Labor oppose the government on this initiative. Last night and this morning we have had to endure the endless dickering around by the member for Werriwa on this issue. Bob Maumill, radio presenter and Labor sympathiser in Perth, last week said on air something to the effect that the sage of Werriwa was all pee and wind. They are not his exact words, but I think in parliament—83VEmerson, Craig, MPDr Emerson—Can you say `pee and wind'?00AN4Tollner, David, MPMr TOLLNER—I think you can.K26Latham, Mark, MPMr Latham—Is it parliamentary?10000SPEAKER, TheThe SPEAKER—None of the comments made in the past 10 minutes have raised the standard of debate but, as I reminded the member for Werriwa, I remind the member for Solomon that the use of quotes does not permit the insertion of unparliamentary language into the debate.K26Latham, Mark, MPMr Latham—Mr Speaker, I rise on a point of order. Is he using `pee' as the letter p, or as a word?10000SPEAKER, TheThe SPEAKER—The member for Werriwa will resume his seat.00AN4Tollner, David, MPMr TOLLNER—That was not the exact quote. It was other words.10000SPEAKER, TheThe SPEAKER—The member for Solomon will proceed with his address.00AN4Tollner, David, MPMr TOLLNER—This is what the executive director of the Australian Petroleum Production and Exploration Association, Mr Barry Jones, had to say on Monday about these people on the other side, from yesterday's edition of the Australian:The Labor Party has to recognise that rejection of government amendments on effective life is detrimental to gas developments across the country. It would place federal Labor in conflict with the developmental aspirations of their Labor colleagues in Western Australia, the Northern Territory and Victoria.What we have at the moment in this country is a Labor Party deeply divided and all over the place, like a mad dog's breakfast. The member for Werriwa and the member for Fraser are at odds with the member for Hunter, who is advocating this measure. They are also out of step with their state and territory Labor colleagues, who unanimously support the measure. Then there are, of course, the problems that they are experiencing in Victoria with Greg Sword and their other union masters. These turkeys opposite are trying to convince the Australian public that they will stand up for business.83VEmerson, Craig, MPDr Emerson—Mr Speaker, I rise on a point of order. The language that the member for Solomon is using is surely unparliamentary. I know you were preoccupied, but—10000SPEAKER, TheThe SPEAKER—The member for Rankin is aware that I was in fact genuinely in conversation with the Clerk and, I must admit, did not hear the comment made by the member for Solomon. I will, therefore, ask the member for Solomon to return to his speech and modify his language appropriately.XJ6Anthony, Larry, MPMr Anthony—Mr Speaker, I rise on a point of order. Whilst I acknowledge the comment by the spokesperson from the opposition, I want to draw your attention to comments which you noted that were previously made by the member for Werriwa and which were, quite frankly, way out of line. I think the comments that were made just then are within parliamentary practice.10000SPEAKER, TheThe SPEAKER—The minister is aware that I did not hear the comments made by the member for Solomon. My reference to the member for Werriwa was consistent with a previous debate in this House, and I therefore am certain that the member for Solomon has got the message and I invite him to return to the bill. 00AN4Tollner, David, MPMr TOLLNER—People on the other side are trying to convince the Australian public that they will stand up for business and that they are credible supporters of the Australian business community. At the same time, their bullyboys in the union movement are putting the squeeze on the manufacturing industry by blocking steel supplies at BHP. Not content just to jeopardise current jobs, the members for Fraser and Werriwa now want to obfuscate on this very important measure and try to throttle the investment end of business. I can only hope that the new Northern Territory Chief Minister—who, I might add, has quickly developed a reputation for inaction—will rub the sleep from her eyes and perk up for long enough to have a chat with the members for Fraser and Werriwa and gently tell them how silly and irrelevant their views are.It is doubly pleasing to see the statutory caps for gas and oil assets in the 2002-03 budget. It is pleasing, firstly, because it was good to be able to go back to my constituents and say, `The government is not dickering around like the opposition; we are getting on with the job of tax reform and adjustment, getting treaties ratified and doing what is necessary for the development of Australia's next major gas hub.' Secondly, it is pleasing because I know depreciation was a real concern to those people who are planning to build those assets. This amendment provides a real shot in the arm for those people. I will quote again from a couple of the major industry players. On 15 May, Bill Nagle of the Australian Gas Association said:The Federal Government's decision on effective life removes one of the major impediments to renewed gas industry development in Australia.On 24 May, Shell CEO Alan Parsley said:This cap will assist in providing an investment regime in Australia for new oil and gas projects that is internationally competitive.This amendment, however, does not necessarily mean that my constituents are totally appeased in regard to Timor Sea gas developments. Many of my constituents still reckon that we are probably getting ripped off. Certainly many see the concept of an offshore floating LNG platform over the Sunrise-Troubadour fields as little short of theft. Everyone has heard that East Timor is getting 90 per cent of the royalties from the Bayu Undan resource. They do not begrudge it; they support getting East Timor back on its feet. Many of my constituents were born in East Timor. But they ask, in the context of a floating LNG plant, what Australia is getting out of it. They ask me about the national interest.This phrase `in the national interest' has a particular history in the Territory. It was in the national interest that bauxite mining commenced on the Gove Peninsula, against the objection of families who are now national figures. It was in the national interest that the Brisbane Line was drawn. It was in the national interest that construction commenced on the rail link between Darwin and Adelaide, and I again pay tribute to the member for Bennelong for his vision in supporting and driving this important project.Recently I attended the Mining Industry Council dinner where the federal Treasurer was the guest speaker. Of course, true to form, he delivered a first-class speech. I was again reminded of the national interest, because the Treasurer raised it in the context of the Shell bid for Woodside. He said of his decision, and I will quote exactly so as to avoid any bad paraphrasing:The issue was whether I could be sufficiently certain that following the takeover, the North West Shelf would be developed in a way that would benefit Australia and lead to the maximum development and exploitation of that great natural resource. In that case I could not. I took the view that it was contrary to the national interest.I absolutely concur with the Treasurer. The North West Shelf should be developed in a way that will benefit Australia and lead to the maximum development of that great natural resource. So should the Timor Sea. So should all Australia's great natural resources.The Treasurer's decision on Shell Woodside took a great deal of courage, and he should be congratulated for it. It was seen in my constituency as the right decision. To many it was also a symbolic decision, broadcasting a message that we are not selling up the farm. Territorians, my constituents, are now looking for another sign from the government that we are not selling up the farm, that we are not allowing Timor Sea gas to vaporise offshore while the queues of unemployed Territorians lengthen. They have heard of the elusive riches to be had from the Timor Sea for many years now and—like the `faded dream of the railway' as the current lethargic Chief Minister once called it—some are beginning to doubt that it will ever happen.A couple of months ago, on 23 April, the Epic Energy CEO, Sue Ortenstone, addressed APPEA at their 2002 convention in Adelaide. She pointed out that gas transmission lines do not happen overnight, generally taking three to five years in development. In five years time, in 2007, gas production from the Cooper Basin will begin to plummet from 600 to 300 petajoules over the following six years. The Gippsland Basin will keep going at current levels of about 300 petajoules a year until about 2018. The Cooper Basin could be exhausted by 2015. But from 2007 onwards Australia will need more gas just to maintain current production levels. That is what makes the matter so urgent today. Sue Ortenstone pointed to the Californian energy crisis to show what poor infrastructure planning can mean, and she spoke of diversifying in less prescriptive environments. That is code for government making life more difficult for people in her line of business, and there is no doubt that there are regulatory issues that remain unresolved.In this amendment the government resolves the question that hung over depreciation rates on assets in the oil and gas industries. In so doing, it breaks down a barrier that stood in the way of further development of the gas industry. I welcome the bill—this amendment in particular—and greatly look forward to further initiatives that will provide the industry with the certainty needed to drive on forwards, and provide my constituents with the news that the coalition is still getting on with the job. 10:05:003784Emerson, Craig, MPDr EMERSON83VRankinALP00—The Taxation Laws Amendment Bill (No. 4) 2002 contains four parts, or schedules. Schedule 1 tightens some of the provisions relating to thin capitalisation; schedule 2 provides tax concessions to trusts restructuring into companies; schedule 3 provides temporary residents of Australia with a tax exemption for income sourced outside of Australia; and schedule 4 legislates for a type of accelerated depreciation, in the form of legislative caps on the working lives of different classes of assets. The first schedule—the tightening of provisions in relation to thin capitalisation—is an integrity measure and as such Labor support the amendments to the act that are contained in this bill. The second schedule—providing for tax concessions to trusts restructuring into companies—is costed by the government at zero. We will obviously be interested in the basis of that costing. If the cost is in fact zero, Labor would not have any great difficulty with the proposal contained in schedule 2.We do have difficulty in relation to schedule 3, which provides temporary residents of Australia with the tax exemption for income sourced outside of Australia. I point out that this measure is based on recommendations of the Ralph report; but the Ralph report was not as generous and recommended only that income earned from assets owned before the person became a temporary resident should be exempt from tax. Australian company executives pay tax on all of their income, irrespective of whether that income is earned in Australia or overseas, yet the government is arguing that foreign company executives should have special consideration; that is, that they ought to be able to have tax relief—pay no tax, in fact—on income from assets that are outside of Australia. I think the government has completely failed to demonstrate any national benefit coming out of this measure. It has not put a case before this parliament. The entire second reading speech runs to 1½ pages, if that, and deals with all four schedules.XS4Lawrence, Dr Carmen, MPDr Lawrence—The $1.9 billion, wasn't it?83VEmerson, Craig, MPDr EMERSON—The $1.9 billion in fact relates to the accelerated depreciation. This is $50 million a year. There is no demonstrated basis for it. A number of company executives have obviously asked for it—`Ask and you shall receive. Knock and the door shall be opened'!XS4Lawrence, Dr Carmen, MPDr Lawrence—To some.83VEmerson, Craig, MPDr EMERSON—That is, if it is the Liberal door that you are knocking on and you happen to be a company executive. Let us have a quick look at the track record of some of the foreign company executives who have come into Australia. They have been brought in on a number of occasions to rip companies apart and to sack workers. In at least one case, a major corporation was effectively brought to its knees. That particular managing director received a payout of $13 million for almost destroying an icon Australian company. And the government want to say: `That $13 million isn't enough. His salary isn't enough. What we really want is for that particular company executive and those who follow him to be able to enjoy tax relief—to have no tax obligations—on income from assets owned by that particular company executive outside Australia.'Yet an Australian company executive, who would have done a far better job than this particular overseas executive, would pay tax on any income that he or she earned from assets that they had overseas. Is this some sort of cultural cringe—that our managers are not as good as overseas managers? I would add that there have been some successful examples of company executives from overseas coming to Australia and building up a company, but there is no demonstrated case as to why the parliament should support providing $50 million in tax relief a year for such overseas executives. It calls into question the entire set of priorities of this government, about which I will have more to say.Moving on to schedule 4, which relates to accelerated depreciation, members of this House will recall the Treasurer and the now Leader of the Opposition, the then shadow Treasurer, talking across the table a couple of years ago on the government's response to the so-called Ralph committee review. I was listening to that conversation, and the Treasurer assured the shadow Treasurer and now opposition leader that, in return for cutting the rate of company tax, there would be a sufficient package of base-broadening measures to fund it so that there would be no net cost to taxpayers. He not only gave that assurance across the table, he wrote it in a letter and signed it. Two years later, we are in a situation where a number of the base-broadening measures, particularly the taxation of trusts, have not come into force. Why? Because I do not think the Treasurer ever intended to bring them into force. The National Party mounted a campaign on the basis that farmers all had trusts. I have had a look at the figures. A very small proportion of farmers actually have trusts. The big end of town, the big end of the farming community, have trusts, but small farmers do not. The National Party should have been representing the interests of the small farmers around Australia and been quite accurate in making the case that the taxation of trusts would not have disadvantaged those small farmers because they do not have trusts.The Treasurer reneged on that commitment. I do not believe he ever meant to keep it. It tells us a lot about the integrity of this government. In estimates the other day, our senators were asking the Treasury officials for figures on the total package as it has finally emerged over the last couple of years and whether it is revenue neutral. They were unable to answer that; they said that they would go away and maybe come back to us. I would not be holding my breath, because it is almost certain that there is a big revenue hole. But we will never know, because this government does not want us to know.This government seeks to implement very costly measures while providing a paucity of information about the basis for those measures and how much they will cost in particular years. For example, the provision of these caps on accelerated depreciation is costed in total at $1.9 billion over 10 years and, I think, it is some $300 million over the next few years; but we do not have an annual cost for that at all. Our argument is that a measure that is so costly—$1.9 billion over 10 years—should be subject to some parliamentary scrutiny. But we have members opposite arguing in this parliament that it should not. They are arguing that this should not go to a Senate references committee—that the government should not be obliged to tell the Australian taxpayers just what that $1.9 billion worth of revenue is going to be spent on. The effective-life caps proposed by the government are obviously shorter than those proposed by the tax commissioner. The Treasurer announced on 21 September 1999, in the government's response to the Ralph review, that the tax commissioner would be reviewing the effective lives of long-living assets and that the commissioner would be working to publish a revised effective-life schedule by 30 June 2000. It is now June 2002 and we have just got that, and the government is saying, `The tax commissioner has been a bit tough here so we're going to legislate over the top of the tax commissioner.' I have not seen any reference in this document, which is the major media release of 1999, to the government saying, `We'll get the tax commissioner to review the effective life of various classes of assets but then we'll override him,' but that is what the government is doing today. Not only is it doing that; it is saying that this parliament has no right to know how much it is going to cost in respect of individual assets.The various classes of assets are aeroplanes, helicopters, gas transmission and distribution assets, oil and gas production assets, offshore oil and gas platforms and assets used to manufacture condensate, crude oil and other petroleum products. There are different caps proposed by the government to override the tax commissioner on these. But we do not know how much of this is for planes, how much of it is for helicopters or how much of it is for gas transmission, so the whole budget process over the last few years has been eroded to the point where it is laughable to even use the phrases `transparency' or `a charter of budget honesty'. There is nothing honest about the budget papers any more because we just do not know and the government does not want us to know.I will go on to talk particularly about gas transmission. I think there is a case for having a look at the tax commissioner's proposals in relation to that because the tax commissioner is proposing that gas transmission and distribution assets could be written off between five and 50 years. Fifty years is a very long time and I think there is an argument to accelerate depreciation of gas transmission assets so that they are not written off at such a slow rate. The gas industry is very important to Australia and offers massive potential for this country. If we could get Timor Sea gas onshore, that would be a huge boost for Australian industry. If we could get Papua New Guinean gas into Australia, that too would be a huge boost for Australian industry. If we had either or both of those, we would have genuine gas on gas competition in this country which would only serve to reduce gas prices and make Australia a globally competitive location for energy intensive industries. We already are in respect of electricity but we have a long way to go in relation to gas, so I can see a very strong case for developing a national gas grid that involves alternative sources so that we can achieve gas on gas competition and the creation of large industries and new jobs in regional Australia. My argument is that in many cases the regions of Australia are doing quite well. There is a suggestion around the country that the only places that are doing well are Sydney, Melbourne and some of the other capital cities. Some of our regions are in fact doing very well; but they can do better, and they will do better if we can make them globally attractive locations for industry, if we can get gas infrastructure provided to those areas of regional Australia. There is a compelling case to develop a plan for Australia that involves critically a national gas grid. I see my colleague the member for Hunter, who will be speaking next, and I would be astonished if he had any other view. In fact I know he does not: he is a strong supporter of the gas industry, he is a strong supporter of the need for a national gas grid and gas on gas competition.So when members opposite say, `Look, Labor are against accelerated depreciation in respect of gas transmission because they want to send this to a Senate committee,' that is an absolutely ludicrous proposition and an unnecessarily provocative proposition. On behalf of the Australian people we want to find out how much of the $1.9 billion in revenue that will be sacrificed under these proposals is for gas, how much is for helicopters and how much is for aeroplanes. I think that is a perfectly reasonable request. We trust that this will go to a Senate committee and we trust that Treasury will be more forthcoming than it has been in the explanatory memorandum on this, because the explanatory memorandum is close to insulting in terms of how little detail there is.I said that I would return to the question of the government's priorities in providing tax concessions to foreign corporate managers who are temporary residents of this country. The case has not been made for that, but the measure, costing about $50 million a year, can be juxtaposed against the government's decision to freeze the R&D Start program, saving around $40 million a year. The R&D Start program is important to any effort on the part of an Australian government to invest in the nation's future. But, within months of the Minister for Industry, Tourism and Resources getting the job, he had agreed to cut departmental funding by 30 per cent over four years, to cut his own department's staffing by 10 per cent and to cut or freeze the R&D Start program, to save $40 million. There is chronic underinvestment in research and development in this country. Business expenditure on research and development as a share of GDP has fallen in each and every year of the Howard government. New figures are due out on 1 July, and we will obviously be examining them with great interest. What a time to be freezing the R&D Start program, preferring to use the money to provide tax relief to foreign managers, many of whom have come here and destroyed good Australian companies! What set of priorities does the government have? It says that we are wrecking its budget because we are not happy about the government spending $50 million for this purpose. If the government were to reconsider this measure and abandon it, it would save money. So the government is saying, on the one hand, that we are wrecking the budget by preventing particular savings measures from proceeding and, on the other hand, that we are wrecking the budget by preventing the government from wasting $50 million on foreign company executives. It cannot have it both ways.The government ought to get its priorities right. It ought to put more funding into the R&D Start program or at least unfreeze it, thaw it out. The minister said to the Financial Review on 29 January this year, `We've got the balance pretty right on R&D.' If the balance that he is talking about is a reduction by the private sector in R&D spending as a share of GDP in every year, and if he considers that to be the right balance, then we are in a lot of trouble while ever this minister has carriage of research and development funding in this country.The same minister has failed to represent the industries that are vital to the nation's future. I think his concern is to appease the Treasurer and to show that he is hairy chested and that he can make cuts just as well as the Treasurer. He ought to lift his game, start investing in the nation's future and start supporting research and development in this country. He ought to oppose providing tax relief to foreign executives coming into this country, many of whom have been paid big money to destroy Australian companies and to destroy Australian jobs.10:24:003787Fitzgibbon, Joel, MPMr FITZGIBBON8K6HunterALP00—I am sorry that I missed the contribution from the member for Solomon; I understand that it was somewhat colourful. I do note that the member for Solomon was the only speaker on the government side on this very significant bill, the Taxation Laws Amendment Bill (No. 4) 2002. I do not know whether that is because they are running from suggestions that overseas executives should be given big tax breaks or whether it indicates that there is not any real support for the general measures contained within the bill. I will let others be the judge of that.83VEmerson, Craig, MPDr Emerson—They do not understand it.8K6Fitzgibbon, Joel, MPMr FITZGIBBON—Possibly the member for Rankin is right. I am sure that many on that side do not understand very well the propositions being put forward. Certainly, we do not understand what the depreciation caps mean in terms of the cost to the budget and that is what we will be seeking to determine when this matter goes to the Senate committee.As other speakers have indicated, this bill seeks to amend the Income Tax Assessment Act 1936 and the Income Tax Assessment Act 1997 in order to implement four government initiatives. The first amendment tightens the provisions covering thin capitalisation; the second provides tax concessions to trusts attempting to restructure as companies; the third provides temporary residents of Australia with tax exemptions for income sourced outside Australia; and the fourth provides effective-life caps for the depreciation schedules which apply to certain assets including oil and gas production, distribution and transmission assets and aeroplane and helicopters assets.As has been indicated by the member for Werriwa and those on this side following him, including the member for Rankin, the opposition will be opposing the third point I mentioned—that is, the new tax regime being proposed for temporary residents. On point four, the effective-life caps, we will be asking a Senate committee to have a closer look at the implications for the Commonwealth budget and in particular we will be seeking a disaggregation of those costs—in other words, we will be looking at how they apply to helicopters and aeroplanes and how they might apply to oil and gas production and distribution and transmission assets.It is that point I want to dwell on in the time available to me this morning: the last amendment, the capping of depreciation assets in the oil and gas sector. It is a proposal I clearly support. There are many drivers of economic growth in the Australian economy, and the international competitiveness of our companies and our work force is among the most important of them all. In this regard Labor has a great legacy. During its last 13 years in office, between 1984 and 1996, Labor dramatically reduced the corporate tax rate; reduced tariff levels, making us more competitive on the international scene; gave Australia a floating exchange rate; exposed our public utilities to competition; created new sources of non-debt equity finance through the imposition of compulsory superannuation; raised productivity levels to record heights; used government policy to raise both government and private investment in research and development; and brought new urgency to approaches to investment initiatives through accelerated depreciation and schemes like the infrastructure borrowing scheme. While these initiatives provided benefits for all sectors in the Australian economy, they produced particular benefits for the oil and gas sectors. Indeed, a strong interest in the focus on the proper development and exploitation of our natural resources was a real hallmark of the Hawke and Keating governments—an approach pioneered by Gough Whitlam in the early 1970s.Australia is blessed with a wealth of both oil and natural gas. The exploitation of those resources makes an enormous contribution to the nation's welfare in terms of output, employment, exports, tax revenue and, of course, energy self-sufficiency. Under Treasurer Keating the right balance was struck between ensuring the Australian community—that is, the people who own our natural, non-renewable resources—derive maximum benefit from the exploitation of those resources and at the same time ensuring that the tax regime which applied to the exploitation of those resources reflected the fact that the exercise is one of high risk and one in which, more often than not, profits are low relative to the huge amount of investment which is required. Very importantly, Keating's petroleum resource rent tax was all about ensuring that a company's tax liability reflected not the volume but the profitability of the operation. Paul Keating also introduced wider exploration deductability, which allowed participating companies to transfer exploration expenditures from one project to another. The message here is that, on a geographically large continent with a small population and therefore a small domestic market, where almost all our oil and gas reserves are so remote from our main centres—or, to say the same thing, our key markets—there will always be a role for government to ensure that those resources are efficiently and properly exploited and the maximum return given to the Australian people. Part of the government's role is ensuring that our taxation, industrial relations and regulatory regimes are internationally competitive. On the taxation front it means doing our best to ensure that both the Australian company tax rate and our depreciation schedules are internationally competitive. The reality is that currently we are not as competitive as would be liked. As compared to those of our Asian neighbours, our corporate rates are higher; and in Asia the average depreciation regime is around five years.Lower rates of corporate tax and shorter capital depreciation periods come at a cost to the Commonwealth budget, and we all accept that. The cost represents money which could be spent on schools, hospitals and other social welfare programs. But there is another side to the ledger. A more competitive taxation regime means more investment, longer-term investment planning, more production, greater value adding opportunities, more jobs and, in turn, higher tax revenues. Building a competitive national gas grid is about nation building. It is about adding value to our natural mineral resources—smelting our minerals on-site, as MIM will do if it can get an energy supply at a price that makes such a process economically viable. The price will only come if we have competitive energy markets.I imagine the member for Solomon spent most of his time railing against the opposition for having the audacity, as he would say, to send this bill to a Senate committee. Despite all that I have said about the importance of this initiative to the oil and gas market, it is entirely appropriate that we should be requesting closer scrutiny of the cost of this initiative to the Commonwealth budget. During Senate estimates hearings, both tax and treasury officials were very evasive in regard to this. The explanatory memorandum gives us no more than an aggregate of the cost over a five-year period and a 10-year period—it is something like $1.9 billion over the 10-year period.What the opposition would like to know, in particular, is: what is the sectoral breakdown of that cost to the budget? What amount of money will, by way of depreciation, in effect go to the oil and gas sectors? What amount of money, by way of depreciation, will go to the aircraft industry? I think that is an important point to be made. When any proposition like this—a significant change to the Income Tax Assessment Act—comes forward, it is appropriate for us to want to scrutinise its impact on the Commonwealth budget and therefore its impact on the wider Australian community. The EM on this occasion has not done so, and so it is appropriate that we ask those questions.I wish to speak more generally about something that has been referred to earlier, the Ralph Review of Business Taxation and some of its outcomes. Throughout that longwinded process there was an agreement that the Australian business community would trade off accelerated depreciation for a lower rate of company tax. But let us not kid ourselves that the business community was as one on that issue. Indeed, the business community was somewhat divided on that issue. Those with lower and shorter-term investments making high profits welcomed a lower company tax rate. For those in the oil and gas industries, where one makes huge capital outlay investments with very long lead times—in some cases up to 20 years—depreciation is more important than a lower company tax rate, because investors do not make any money in those early years. Therefore, in some cases, depending on the organisational structure, the lower corporate tax rate is of no assistance at all, but an accelerated depreciation regime is very important. Let us not kid ourselves that the business community were all as one on this issue. Certainly, those who preferred the trade-off won at the end of the day, but those who were fighting for the retention of accelerated depreciation were the people that part of this bill is targeting: people who invest heavily in the oil and gas industries.Revenue neutrality in the Ralph report has become a bit of a misnomer. In terms of the target of revenue neutrality, that revenue neutrality was not based on the difference between the accelerated scheduled rates and 50 years; it was based on the difference between eight, nine and 10 years and the existing non-accelerated schedule of 20 years. So it is not sound to argue that by not allowing the effective life to blow out to 50 years, 40 years or 30 years—whatever one may choose—you are undermining the revenue neutrality objectives of the Ralph report; you are not.It is also very important to consider the fact that, when people were trading away the corporate tax rate for accelerated depreciation, or vice versa, no-one in the oil and gas sector, in particular, ever envisaged that the Commissioner of Taxation would hand down a determination indicating that 50 years is the appropriate effective life of oil and gas production, transmission and distribution assets. No-one had in their mind that that would be the case. I would put it to members on both sides of the House that that corporate tax trade-off with accelerated depreciation would never have been secured if those people, particularly in the oil and gas sectors, had any idea that they could be facing a 50-year regime in the future. I want to reiterate that this is a welcome initiative. It delivers to the oil and gas sectors, in particular, its expectations on the trade-off between the corporate rate and accelerated depreciation and protects a crucial part of the Australian business community from excessive periods of effective life and, therefore, protects us from an underinvestment in this very important sector. Unlike Qantas—and I will be happy to hear the case from Qantas—my view is that the oil and gas sector does not need to make out a case for the capping of these regimes. I think that case has already been made out. You would have seen in the business section of the Australian doubts about something that I have already mentioned—MIM's proposals to add value to our natural mineral resources in areas like Mount Isa. We have seen in recent times quite a lot of doubt about the economic viability of the PNG pipeline, which would not only bring new sources of gas to the Australian mainland but also introduce greater competition in the gas sector. We have seen the long-running debate about the Sunrise gas field and whether or not that gas will be brought onshore for domestic gas purposes and, in doing so, bring enormous quantities of competitively priced gas to Darwin and the greater Northern Territory and, therefore, open up all sorts of industrial possibilities in a territory which has long been largely dependent on Commonwealth revenues. That gas would again introduce new competition into the market and hopefully bring to companies like MIM the competitively priced gas that they are looking for. In terms of Sunrise, let me say what a tragedy it will be if the gas pipeline from Bayu Undan is built with only sufficient capacity to transport the gas going to that onshore LNG facility. We have to plan much better than this. We have to ensure that, when those pipelines are planned and constructed, they have the capacity to deal with not only current domestic needs and the needs of current projects but also the country's long-term needs and, therefore, the country's long-term interest. That can only occur if we have an internationally competitive taxation regime.On a wider front, the last few points that I have highlighted underline the lack of a strategic approach on the part of this government to energy in this country. There is no coordinated approach from this government. This country needs a national energy policy which predicts these problems before they arrive on our desks and to have a strategy in place for dealing with them. There should be no ad hoc approach to this industry. Such an important industry requires long-term planning. We are not getting that from the government. The Sunrise situation is an example of that. The Bayu Undan situation is a good example of that. The uncertainty over the PNG pipeline is also a good example of that. The fact that we find ourselves faced with the necessity of having to refer this part of the bill before the House today to a Senate committee is yet again another example of that. We should have more planning in regard to these issues. All the opposition is seeking today is an opportunity to better scrutinise the impacts of that part of the Taxation Laws Amendment Bill (No. 4) 2002 on the Commonwealth budget.I acknowledge that 50 years would be absolutely ludicrous for the oil and gas sectors. It would mean catastrophe for those sectors. My view is that a 20-year cap is an appropriate one. But, if the government is serious about introducing that cap, it needs to be more forthcoming on the impacts on the budget and on the disaggregation of those costs. Rumour has it that overwhelmingly those costs are derived from the impact of this bill on the aviation industry and not from the impact on the oil and gas sectors. I think it is right for us to ask those questions and to ask the aviation industry to put forward a case as to why those changes to the rates are appropriate. I support the proposal but call upon the government to be helpful in this regard. We want a short, quick and efficient inquiry into those costs. We want this to happen properly. We want to be sure that, if this new regime is introduced, it is introduced very quickly so as to remove any uncertainty in those sectors that I have referred to. 10:43:003790Slipper, Peter, MPMr SLIPPER0V5FisherLPParliamentary Secretary to the Minister for Finance and Administration10—in reply—I thank those honourable members who participated in the debate on the Taxation Laws Amendment Bill (No. 4) 2002. I listened to the contributions made by Labor members; in many cases they were not speaking directly on the subject matter of the bill. They also tended to ramble on. The member for Werriwa, who has returned to the chamber, dragged out in a childish way his tired old joke over the fact that a number of ministers on this side share surnames which start with the same letter of the alphabet. I think we are sick of hearing about that. He did not tell us, of course, about the machinations within the Australian Labor Party over economic policy and his difficulties with the member for Fraser. Of course, those matters were highlighted the last time the parliament sat. In this bill the government is continuing to deliver on its promise of business tax reform, and we are particularly pleased that we have this opportunity. We are pleased with this item of legislation. I have to say that I am personally disappointed with the approach of the opposition and, in particular, the amendment which has been foreshadowed by the member for Werriwa. The member for Werriwa, one would think, is a member paid by the word. He likes to come in here and make a lot of noise. He is very much an empty barrel and he does not make a lot of sense. I am pleased to assure him that some of his misapprehensions which he mentioned in the House are in fact not matters about which honourable members or, indeed, the Australian community ought to be concerned in any way, shape or form. The member for Werriwa brought forward the rather strange claim that the banks will benefit from the exemption from the withholding tax. I am pleased to advise the honourable member that it is not the banks but rather temporary residents who will benefit in most cases. Temporary residents are often required to compensate the bank for this additional unexpected expense. If the interest payment is not exempt from withholding tax, it will often be the payer in Australia and his or her employer who bears the cost. The member for Werriwa also queried what sectors will benefit from the exemption applying to temporary residents. While the measures contained in the bill are available to all temporary residents, the exemption will particularly benefit industries employing highly sought after skilled employees. I am pleased to tell the honourable member that the top five occupations on business long stay visas in 2000-01 are computing professionals; applications and analyst programmers; general managers; registered nurses, interestingly enough; and also accountants. It is expected that the finance and computing sectors in particular will benefit. The member for Werriwa also suggested that the exemption will be available to Australian executives of multinationals. The exemption will be available only to genuine visitors to Australia, so the honourable member ought to take notice of that, and permanent Australian residents, whether or not they work for multinationals, will indeed not benefit.The member for Werriwa, obviously in pursuit of trying to consume as many pages of Hansard as possible, alleged that the government had not gone ahead with trust reform. I want to point out to him that the government does remain committed to addressing tax abuse, including abuses in the trust area. The Board of Taxation is currently examining the scope for tax abuse in the trust area and how this can be addressed without consequences for legitimate businesses and other arrangements.The member for Werriwa also asked why details of costs across industries and assets have not been made available. There is a pretty simple answer to that, as indeed there is to most other matters raised by my friend the member for Werriwa. A breakdown of the costing by industry and by asset cannot be made public, as to do so would identify the taxpayers affected by the caps on some classes of assets. The issue raises commercial sensitivities because of the ease with which taxpayers could be identified. I am certain that this fully explains the matter raised by the member for Werriwa.K26Latham, Mark, MPMr Latham—You're protecting your mates!8K6Fitzgibbon, Joel, MP10000Jenkins, Harry (The DEPUTY SPEAKER)The DEPUTY SPEAKER (Mr Jenkins)—Order!0V5Slipper, Peter, MPMr SLIPPER—The members ought not to interject, because taxpayers are indeed entitled to privacy. When you have a situation where to provide information would identify individuals, I do not think that any reasonable person on either side of the House would require that particular information to be made available.The member for Rankin also joined the debate and asked the curious question: why should foreign executives get this benefit when Australian executives have to pay Australian tax on all foreign income? Again, I am pleased to advise the honourable member that the exemption is for people temporarily in Australia for the first time in 10 years, not permanent residents who get more benefits. In most cases there will be foreign tax paid on this income and Australian tax is a top-up. The exemption removes the additional costs of the top-up and reduces compliance costs associated with bringing these skilled people to Australia. The member for Rankin also, no doubt in pursuit of his approach to life, mentioned wrongly that the measure only applies to executives. The measure applies to all workers, including oil workers, IT professionals and others who could not by any definition of the term be categorised as `executives'.The member for Werriwa is one of the few people left in Australia who probably still supports socialisation of the means of production, distribution and exchange. He likes to make a lot of noise, which nobody takes any notice of. He said that foreign executives get more concessional treatment than Australian executives. This is not what the measures do. It is a longstanding principle that Australian residents are taxed in Australia on their worldwide income, but nonresidents, to whom foreign executives can best be compared, are only taxed on their Australian sourced income. Obviously double tax treaties come into play, but foreign workers in Australia would normally pay tax on their overseas assets in the country in which they are located. The assets do not avoid tax altogether.We had a very worthwhile contribution from the honourable member for Solomon, who is a great asset to the government. The people of Solomon indicated that they wanted sound representation when they rejected the Australian Labor Party in Solomon at the last poll. The member for Solomon is a very good and effective local member. He has his eye on the ball about what is needed for the people of Darwin and Palmerston and for the others who were fortunate enough to be excluded from the electorate of Lingiari and included in the electorate of Solomon. He pointed out that the legislation before the chamber is of benefit to his constituency. I want to thank the member for his contribution and for recognising publicly here in the parliament the benefits not only to his constituency but also to all Australians of this very important initiative of the Howard government.Unlike those opposite, the member for Solomon recognises that the government is taking a responsible and far-sighted approach to long-term infrastructure spending. The government is taking a strategic approach to industry policy and will continue to address issues in the national interest in a timely way. In saying this I am rejecting an allegation made by my friend the member for Hunter, who suggested that the government did not have long-term planning. Nothing could be further from the truth. The Intergenerational Report, included as part of the budget, looks at where Australia will be in about 40 years time. 8K6Fitzgibbon, Joel, MPMr Fitzgibbon—It is a set of predictions.0V5Slipper, Peter, MPMr SLIPPER—The member for Hunter ought to really apologise for the very dilatory way in which the Labor Party managed the economic affairs of this country during those 13 years. This is the first government—8K6Fitzgibbon, Joel, MPMr Fitzgibbon—It was an excellent record.0V5Slipper, Peter, MPMr SLIPPER—You said they had an excellent record? You are misleading the House when you say that. The member for Hunter ought to thank the government for being the first administration in Australia's history prepared to look at where we will be as a nation in 40 years time. We are the first government prepared to look at the challenges and make sure we have appropriate policy responses so that Australia in 40 years time will indeed continue to be viable. That is why we have made some of the important changes in the budget with respect to ensuring that the Pharmaceutical Benefits Scheme is sustainable in a long-term way. That is why it was important to make the very minor reforms to the disability support pension.The member for Solomon made a very positive contribution. It is regrettable that honourable members opposite do not take the same view and do not make the same positive contribution to good governance in this nation. The member for Hunter came in and claimed that the explanatory memorandum lacks detail. Maybe he made a mistake when he made that particular allegation.8K6Fitzgibbon, Joel, MPMr Fitzgibbon—Not at all.0V5Slipper, Peter, MPMr SLIPPER—I can see his head shaking. I would have thought that the explanatory memorandum had quite a bit of detail; after all it is about 90 pages long. We are working to provide the opposition with as much extra information about the contents as we can.8K6Fitzgibbon, Joel, MPMr Fitzgibbon—What about the costings?0V5Slipper, Peter, MPMr SLIPPER—My friend, the explanatory memorandum follows a longstanding format that is appropriate. What you have said has no substance at all.The member for Hunter did actually say something that I agreed with on one occasion. He said Australia should be internationally competitive, and I could not agree more. That was part of the government's motivation in introducing the exemption for foreign income of temporary residents. At the moment we cannot compete with Japan, Hong Kong or Singapore—and soon even New Zealand will be ahead of us in this particular area. So maybe the member for Hunter ought to dissuade the member for Werriwa from proceeding with his intentions.The member for Hunter also claimed that the revenue neutrality objectives of the Ralph report are being undermined. The response to that is quite clear: the Ralph objective was for the whole of its tax reform package; it was not on a measure by measure basis. Clearly the government is managing the effect on the budget of all of its tax changes. Even adjusting for timing changes, the package remains broadly revenue neutral. I hope that we do not hear again the claptrap we heard today from the member for Hunter in relation to that particular matter.K26Latham, Mark, MP0V5Slipper, Peter, MPMr SLIPPER—Before I proceed to some of the more detailed measures contained in the bill, it is eminently regrettable that we hear continual slurring comments from the member for Werriwa. I suppose some call him the sage of Werriwa. I suspect that the member for Fraser has a much more descriptive term for the member for Werriwa. I have to say that those opposite talk about improving standards in the parliament, but since the election the only real mark of the leadership of the member for Hotham has been the mark of disrespect, and opposition members seem to have made and expressed some exhibitions of gutter politics. I think it is a pity, particularly when so many young people and children listen to the parliament, that the member for Werriwa and some of his colleagues misbehave in a serial way and lower the tone of the parliament. Of course it is not too late for the member for Werriwa to recant. He has a couple more years before the electors of Werriwa no doubt seek a more appropriate representative.The first schedule of the Taxation Laws Amendment Bill (No. 4) 2002 contains technical amendments to the thin capitalisation rules. Following recommendations of the Ralph review, the government revised and improved the thin capitalisation rules, but further amendments are needed to ensure that the rules operate as intended. The amendments in this bill are a series of technical and minor changes to finetune the legislation. Some changes preserve the integrity of the rules by making sure they cannot be manipulated and some, like the proposal to exclude private assets and clarify the bookkeeping requirements, will make the rules easier for taxpayers.The second schedule contains a new capital gains tax rollover. There will be no capital gains tax when assets from a fixed trust are transferred to a company and the trust subsequently ceases to exist. The rollover also applies to taxpayers who exchange units or interests in the trust for shares in the new company. The idea of the rollover arose out of the original proposal to tax trusts as companies, which, as the House knows, did not proceed. But it was realised that the rollover would give businesses greater flexibility to move from one business structure to another.The third schedule contains provisions to give foreign income exemptions to temporary residents, and that is the subject of the amendment to be moved by the member for Werriwa. It will not surprise the opposition to know that we are not going to accept that amendment. These exemptions were originally announced as part of the Ralph Review of Business Taxation, and the government recommitted to the measure during the election campaign. There were convincing representations made to the Ralph review and the government about the impact of tax considerations on the willingness of firms to bring employees to Australia. Australian firms often reimburse such employees for any tax cost arising from moving here. The government does recognise the importance to Australia of a competitive expatriate regime, and removing impediments to the temporary employment of skilled foreign workers will be of significant benefit for skill-intensive industries and firms and will assist in attracting and retaining corporate headquarters. That is why it is so pathetic to hear members of the opposition oppose what the government is seeking to do. Other countries in the region, including Singapore, that compete for this business also have special tax arrangements for temporary employees. The New Zealand government has indicated that it will be considering a similar measure. Australia will benefit from the dynamic effects of having more and more businesses located here as well as from the expenditure and local employment they will generate. Australia also benefits through the transfer of new management and other skills that key personnel bring to Australian business. If the member for Hunter wants Australia to be internationally competitive then he should support rather than oppose this measure.These measures do not give temporary residents advantages over Australian citizens. A temporary resident selling an asset overseas pays tax on the profits in his or her country of residence. In other respects, the bill puts a temporary resident on an equal footing with a resident. The fourth schedule contains the clearly contentious statutory caps measure, bringing forward deductions for depreciating assets in certain industries. Business tax reform introduced the uniform capital allowances regime, a standardised system for calculating deductions for depreciation. Under the uniform capital allowances regime, the Commissioner of Taxation is progressively reviewing safe harbour effective lives. The safe harbour is the minimum period over which an asset can be depreciated and has advantages for taxpayers in that they can have some certainty about the calculation of their depreciation deductions. However, the safe harbour system has limitations in that the commissioner can only consider the effective or working life of an asset and cannot take any other factors, such as conditions in a particular industry, into account. The government is therefore introducing a system to cap or reduce effective lives in some industries in recognition of wider economic issues and the impact that depreciation can have on investment decisions.There has been much speculation that Labor may oppose statutory caps. However, the government care about Australia's industries, industries that invest billions of dollars in this country and create thousands of jobs. Honourable members will know that since the government came to office we have created some 900,000 new jobs. Soon the Howard government will have achieved one million new jobs since our election to office. Statutory caps ensure the long-term competitiveness of Australia's airline, gas and oil industries and help maintain high investment while maintaining the integrity of the tax system. By opposing these measures, Labor is imposing a huge tax slug on these industries, and I suspect there has been some dissension in the ranks of the Australian Labor Party on this issue. Again, the member for Hunter ought to support the government. The sheer size of the tax slug could jeopardise tens of billions in planned investment by the airline, oil and gas industries over the coming decade, with consequences for jobs and consumers. Two examples of potential infrastructure projects that will benefit from the government's statutory effective-life caps are the $2.5 billion project to build the Australian section of a pipeline from Papua New Guinea to Gladstone and the North West Shelf consortium's $3 billion fifth LNG train.The government is not going to resile from this legislation. It is good legislation. The amendment the member for Werriwa intends to move is, like so many other things he says in the chamber, absolutely worthless. I commend the bill to the chamber.Question agreed to.Bill read a second time.3795Bill—by leave—taken as a whole.11:04:003795Latham, Mark, MPMr LATHAMK26WerriwaALP00—I move:(1) Schedule 3, page 34 (line 1) to page 40 (line 9), omit the Schedule.This amendment seeks to delete the measure that the Parliamentary Secretary to the Minister for Finance and Administration was just speaking about. He effectively admitted that this measure is for the top end of town. It is a $200 million tax break for foreigners. It is a $200 million tax break for business executives, and we should not support this measure. Labor believe there are many more effective ways in which to spend government money. At a time when the government is raising pharmaceutical prices for older Australians and cutting the benefits and opportunities for disabled Australians, surely in the management of its budget the government does not need to proceed with a $200 million tax cut for rich foreign executives. The Labor Party want to take this provision out of Taxation Laws Amendment Bill (No. 4) 2002 and will seek to have the House divide on this amendment accordingly. We will also be seeking to have the removal of this provision agreed to by the Senate.I might also express the opposition's frustration that once again we are debating this matter with someone who has no responsibility for taxation policy. The parliamentary secretary performs his functions for the Minister for Finance and Administration. He is not a parliamentary secretary to the Treasurer. As a consequence, he has no executive responsibility and no ministerial responsibility for taxation matters. I pointed this out earlier in the debate. I quoted the Assistant Treasurer, Helen Coonan, who said that the government's bean counting business—that is, their economic ministers—was based on the `three Cs'. The parliamentary secretary said he thought this was a joke. The truth is the joke is on him, because the government's economic business is conducted by the three Cs and unfortunately he is just the `big S'. The `big S' Mr Slipper has no responsibility for taxation policy and no responsibility for Treasury matters. 10000Causley, Ian (The DEPUTY SPEAKER)The DEPUTY SPEAKER (Hon. I.R. Causley)—The member for Werriwa is skating on thin ice again.K26Latham, Mark, MPMr LATHAM—On this bill, one has to wonder: what is his interest in the matters before the parliament? Has he an interest in extensive tax breaks for rich foreign executives? Has he an interest in accelerated depreciation arrangements? When I saw in the Sunshine Coast press the headline `MP demands the one with leather'—a reference to the parliamentary secretary's demand for a new car at an additional cost of $9,000 just so that he can have leather seats—it made me wonder whether maybe his interest in this bill is that he wants accelerated depreciation for the leather industry. He is the one who wants the leather. Of course, there is an argument that he might want to put to the parliament for accelerated depreciation for the leather industry, but I think it also highlights his double life. When I see him around Canberra he is in all orange colours—the Baghwan Shree Rajneesh. On the Sunshine Coast it is all leather for the parliamentary secretary.We have a disappointment that on these matters we are not debating one of the Cs; we are debating one of the Ss of the government—we are debating a parliamentary secretary with no responsibility for taxation matters. It does make a mockery of parliamentary standards. The opposition is very committed to lifting parliamentary standards in this place. The parliamentary secretary made a point earlier on that he thinks that they have been lowered. They are lowered when, in a serious debate about $200 million of public money, a tax break for rich foreign executives, the opposition has the frustration of not being able to debate it with someone who is actually in charge of the measure on the government side. That is our frustration in terms of parliamentary standards. We have a Parliamentary Secretary for Finance and Administration who by his own standards is willing to call people `traitors' and accuse them of treason in this place. He should be the last person who talks about parliamentary standards. You would know, Mr Deputy Speaker Causley, as an honoured member of the National Party, that even your party has standards, because you kicked him out of the Country Party. When Billy Hughes was asked why he never joined the Country Party, he replied, `Even I have standards.' The parliamentary secretary is living proof that today the National Party have standards because they would not take him back for one moment. So, too, the parliament should not accept for one moment this particular provision: an extensive tax break for rich foreign executives. We should reject it. We should have a more equitable and fairer allocation of public money. If the government is serious about making improvements to its budget, if it is serious about returning the budget to surplus, getting away from the deficit fetish, then I can say that the opposition is here to help. Here we are, trying to save money for the Commonwealth to put the budget back into surplus, to improve the fiscal situation of the Commonwealth. I urge the government to accept the amendment. (Time expired)11:09:003796Fitzgibbon, Joel, MPMr FITZGIBBON8K6HunterALP00—I rise to support the amendment put forward by the member for Werriwa. In doing so, I want to take up the misrepresentation of me by the Parliamentary Secretary to the Minister for Finance and Administration when he claimed that I said that the Taxation Laws Amendment Bill (No. 4) 2002 was an attack on the revenue neutrality objectives of Ralph. That is not what I said at all. I said that those who argue that this is an attack on the revenue neutrality objectives of Ralph are incorrect because those revenue neutrality objectives were based on the difference between depreciation regimes of around eight per cent and a regime of something like 20 per cent, and that a regime blown out to 50 years would of course be revenue positive for the Ralph deal. So he has misrepresented me on that point.I did say throughout my contribution to the second reading debate, which he made no mention of, that the gas and oil industry is significant for the development of the Australian economy. We are blessed with an abundance of both oil and gas but, unfortunately, those reserves are placed far away from our main centres of population and therefore our markets. With respect to gas there has to be a recognition that, in the early years of investment, cash flows are negative and the industry does need some assistance if the investment required to bring those resources to our main centres of population is to be forthcoming. That will require a lot of things from government both at Commonwealth and state level. I suggested that the government had no plan in this regard. The parliamentary secretary who followed me in the second reading debate suggested that the government does have a strategic plan for the nation's mineral and energy resources, but he was not forthcoming in nominating that plan. I think that is worthy of note by all—84HZahra, Christian, MPMr Zahra—It is a secret.8K6Fitzgibbon, Joel, MPMr FITZGIBBON—Maybe it is a secret—I do not know. When the parliamentary secretary gets his next opportunity to speak he might like to outline for the House what that plan is exactly. What is his plan in the future to deal with forthcoming questions like the issue of the Sunrise gas fields? What is his plan to ensure that the PNG pipeline does prove to be economically viable in the medium to long term? What is his plan to ensure that the exploitation of our natural resources is done in a way which delivers the maximum possible return to those who own them—the Australian people? The only thing we have seen from this government in terms of the energy market is a COAG review, which was announced in July last year and did not meet until December of last year. In other words, it was a pre-election ploy to defer any attempt to take on some very serious issues both in the electricity market and the gas market beyond the next election. So we had an announcement in July of last year and the first meeting in December of last year. While submissions are now being taken, we cannot expect, and do not expect, and have been told not to expect, any conclusion or outcomes of that process until some time in the first quarter of 2003. The only plan that I am aware of is a government plan to form a committee—a process that the opposition supports but which is all too slow. Given the appointment of former Liberal minister Parer, we are not too confident of getting real outcomes. The Keating government initiated some very significant economic reforms in both the electricity and gas markets, which have produced enormous benefits to the Australian economy and therefore the Australian population. That was backed only last week with the release of the Productivity Commission's report which highlighted the benefits in particular to Australian industry which, in turn, passes those cost savings on to consumers. More particularly, we want a national energy policy. We want to ensure that a strategy is in place to deal with more efficient and cleaner use of fossil fuels generally—in particular coal, which we have in abundance. I am pleased the member for McMillan is in the House because I know he has a deep-seated interest in R&D and technologies which will bring those opportunities forward. But we have no plan from this government to ensure that our natural resources are exploited in a timely fashion and in a way which brings maximum benefit to the Australian people. (Time expired)11:14:003797Emerson, Craig, MPDr EMERSON83VRankinALP00—I would be very interested in getting the assistance of the Parliamentary Secretary to the Minister for Finance and Administration in responding to these questions. As we know, a large part of the cost of the proposals which have been put before the parliament today relates to accelerated depreciation. When the government responded to the Ralph review, it said it would examine the scope for providing accelerated depreciation or some sort of offset for accelerated depreciation on a case by case basis within the strategic investment coordination program—a particularly opaque program. As a result of the lack of transparency in the strategic investment coordination program, the Australian public does not have information on whether under that program any companies have come forward to seek a special deal on accelerated depreciation or a government outlay to compensate for the loss of accelerated depreciation. I would be interested in a response from the parliamentary secretary on the number of companies, if any, that have sought support under the strategic investment coordination program to compensate for the loss of accelerated depreciation and on the nature of any support that has been given to such companies.11:16:003797Slipper, Peter, MPMr SLIPPER0V5FisherLPParliamentary Secretary to the Minister for Finance and Administration10—The amendment proposed by the member for Werriwa is opposed by the government. If carried, it would mean that the measures to reform the tax treatment of foreign income for temporary residents would not go ahead. I refer the honourable member for Werriwa to my contribution in the summing up of the second reading debate. I say again that the government is working to ensure that Australia has an internationally competitive economy. Multinational firms operating in this nation who employ temporary residents to Australia often reimburse such employees for any tax cost arising from moving to Australia. For businesses seeking to maintain or establish regional offices in Australia, costs such as these are an important consideration. Again, as I said, other countries in the region that compete with Australia for these businesses have special tax arrangements for temporary employees. I cite the instance of Singapore and the possible situation in New Zealand where the New Zealand government, as part of its tax review, has indicated that it will be considering a similar measure. Australians will benefit from the dynamic effects of having more and better performing businesses located here, as well as from the expenditure, profits and local employment that such businesses may generate. Australia also benefits through the transfer of new management techniques, information and skills that key personnel can bring to the Australian economy.When I spoke before, I referred to parliamentary standards and how, regrettably, the member for Werriwa is not a paragon of virtue in relation to parliamentary standards. He did mention the fact that I have an orange tracksuit. Certainly, I like to go jogging, as do many other members. It is a rather nice tracksuit and I thank him for highlighting the fact that I follow an exercise regime. He also referred to a distorted and misleading article in the Sunshine Coast Daily. Regrettably, the member did not also refer to the correction which appeared in the Sunshine Coast Daily a couple of days later. There was no truth to that article. It was absolutely outrageous and the record was corrected later. It is regrettable that, as happens so often, the member for Werriwa comes into the chamber and puts forward a completely perverted and distorted version of the facts. With respect to the query from the honourable member for Rankin, I will refer that to the Minister for Industry, Tourism and Resources, the member for Groom. No doubt, the minister's office will be in touch with the member for Rankin with respect to that matter.I think this amendment is absolutely stupid. It seeks to destroy the important changes which the government proposes and I am quite confident that the House will reject the amendment moved by the member for Werriwa. It is interesting how the Labor Party like to encourage matters to be referred to a Senate committee. Does this mean they do not respect the role of the House of Representatives, which is, after all, the people's house? What the opposition should do in this matter is respect the decision made by the people's house on the Taxation Laws Amendment Bill (No. 4) 2002. I am opposed to the amendment and commend the legislation which I moved in the House. I ask the House for its support.Question put:That the amendment (Mr Latham's) be agreed to.11:24:00The House divided. (The Deputy Speaker—Hon. I.R. Causley) 62Adams, D.G.H.Albanese, A.N.Andren, P.J.Beazley, K.C.Bevis, A.R.Brereton, L.J.Byrne, A.M.Corcoran, A.K.Cox, D.A.Crosio, J.A.Danby, M. *Edwards, G.J.Ellis, A.L.Emerson, C.A.Evans, M.J.Ferguson, L.D.T.Ferguson, M.J.Fitzgibbon, J.A.George, J.Gibbons, S.W.Gillard, J.E.Griffin, A.P.Hall, J.G.Hatton, M.J.Hoare, K.J.Irwin, J.Jackson, S.M.Jenkins, H.A.Kerr, D.J.C.King, C.F.Latham, M.W.Lawrence, C.M.Livermore, K.F.Macklin, J.L.Martin, S.P.McClelland, R.B.McFarlane, J.S.McLeay, L.B.McMullan, R.F.Melham, D.Mossfield, F.W.Murphy, J. P.O'Byrne, M.A.O'Connor, G.M.O'Connor, B.P.Plibersek, T.Price, L.R.S.Quick, H.V. *Ripoll, B.F.Roxon, N.L.Rudd, K.M.Sciacca, C.A.Sercombe, R.C.G.Sidebottom, P.S.Smith, S.F.Snowdon, W.E.Swan, W.M.Tanner, L.Thomson, K.J.Vamvakinou, M.Wilkie, K.Zahra, C.J.79Abbott, A.J.Anderson, J.D.Andrews, K.J.Anthony, L.J.Bailey, F.E.Baird, B.G.Baldwin, R.C.Barresi, P.A.Bartlett, K.J.Billson, B.F.Bishop, B.K.Bishop, J.I.Brough, M.T.Cadman, A.G.Cameron, R.A.Charles, R.E.Ciobo, S.M.Cobb, J.K.Costello, P.H.Downer, A.J.G.Draper, P.Dutton, P.C.Elson, K.S.Entsch, W.G.Farmer, P.F.Forrest, J.A. *Gallus, C.A.Gambaro, T.Gash, J.Georgiou, P.Haase, B.W.Hardgrave, G.D.Hartsuyker, L.Hawker, D.P.M.Hockey, J.B.Hull, K.E.Hunt, G.A.Johnson, M.A.Jull, D.F.Kelly, D.M.Kemp, D.A.King, P.E.Ley, S.P.Lindsay, P.J.Lloyd, J.E.Macfarlane, I.E.May, M.A.McArthur, S. *McGauran, P.J.Moylan, J. E.Nairn, G. R.Nelson, B.J.Neville, P.C.Panopoulos, S.Pearce, C.J.Prosser, G.D.Pyne, C.Randall, D.J.Ruddock, P.M.Schultz, A.Scott, B.C.Secker, P.D.Slipper, P.N.Smith, A.D.H.Somlyay, A.M.Southcott, A.J.Stone, S.N.Thompson, C.P.Ticehurst, K.V.Tollner, D.W.Truss, W.E.Tuckey, C.W.Vaile, M.A.J.Vale, D.S.Wakelin, B.H.Washer, M.J.Williams, D.R.Windsor, A.H.C.Worth, P.M.Question negatived.Bill agreed to.3799Mr SLIPPER (Fisher—Parliamentary Secretary to the Minister for Finance and Administration) (11.31 a.m.)—by leave—I move:That this bill be now read a third time.Question agreed to.Bill read a third time.Bills3799R15003799Debate resumed from 14 March, on motion by Mr Anthony:That this bill be now read a second time.11:32:003799Swan, Wayne, MPMr SWAN2V5LilleyALP00—I want to say from the outset that we have looked closely at the Social Security and Veterans' Entitlements Legislation Amendment (Disposal of Assets—Integrity of Means Testing) Bill 2002 and we will be opposing it. Under current social security and veterans affairs rules, pensioners are able to gift up to $10,000 in a pension year. In 1991, the provisions were relaxed so that up to $10,000 could be gifted each pension year without sanction. Amounts above $10,000 were subject to the deeming rules for a period of five years. The value of disposed assets above the limit continued to be included in the calculation of the value of a person's assets for the purpose of the assets test, so they offered older Australians a means of gifting money to their relatives in times of need.The government has previously tried to tighten the rules. The Social Security Amendment (Disposal of Assets) Bill 1999 contained provisions that would have reduced the $10,000 limit to $5,000, and it was defeated. The current bill offers a different approach to addressing the issues of concern to the government. It retains the $10,000 limit but adds a further limit of $25,000 over a rolling five-year period. In effect, it imposes a $5,000 per year limit over a period of five years. It is just a trickier way of limiting gifting by age pensioners. The ugly premise behind this bill is that our age pensioners are rorting the pension. The Howard government is always quick to claim that people are rorting the system, but it is always a little tardier in coming up with the evidence to justify its claims. Just two weeks ago, we heard the story of a case in Melbourne where an age pensioner who participated in one of the many focus groups run on behalf of Centrelink to look at new ways of doing business was confronted with just how far the Howard government thinks it needs to go to tighten eligibility for the age pension. At this focus group, the man was asked what he thought of age pensioners having their irises scanned and fingerprints taken, to be held on record as a means of verifying their identities. The view, without any apparent evidence to back it up, is that age pensioners are rorting the system. The Melbourne man was alarmed—and I was alarmed as well when I heard about it—that this government is going to those lengths, treating age pensioners the way we deal with convicted criminal offenders.The government claim that current gifting rules allowing pensioners to gift up to $10,000 a year to family and relatives are assisting thousands of pensioners to get pension payments they are not entitled to. We asked them for evidence of pensioners using gifting in this way as opposed to lending family members a helping hand in times of need. They could not provide it. What we know is that the government have worked out that tightening the rules will save them $6 million over four years. That tells the story, really. It gives lie to the claims that older Australians are systematically rorting the age pension, because the government have not been prepared to come forward with any evidence that they have. If they were going to save tens of millions of dollars each year, you might believe there was a basis for the claim, but $6 million in savings over four years is hardly evidence of widespread abuse.The reason it is vitally important to have the evidence that the current system is being abused before trying to change the rules is that gifting is an important avenue for many older Australians to help out their loved ones. As a society, we should not be too quick to further constrain the bonds of family between older Australians and their children and grandchildren. Just one per cent of Australian family households include a grandparent or other relative. Where extended family households do occur today, they are made up disproportionately of ageing parents living with adult children. Australian Institute of Family Studies research suggests that relatives play a critical role in supporting families: 35 per cent of adults receive financial assistance from relatives; 82 per cent receive help with babysitting and child care; and 69 per cent receive emotional support in a crisis.Government should not be in the business of limiting older Australians' ability to help their kids or grandkids, unless a clear case of abuse is made out. That is a case the government has not bothered to make out. The case just has not been made. The government is yet, as I said before, to provide evidence that the system is being tightened to prevent systematic abuse by pensioners. Despite promises by the government to provide evidence that people are using gifting provisions to avoid income test restrictions, no data whatsoever has been provided. The current $10,000 limit on gifting has never been indexed, which means that it is automatically becoming more restrictive as the real value of the limit decreases over time. The government is not taking unilateral action to crack down on financial planning approaches that enable people with significant assets to claim the pension. This brings into question the government's decision to tackle this issue. What this all really comes back to is the desire of the coalition to cut back on the small number of benefits and concessions that Australians receive after a lifetime of working for their country.Since coming into office, we have seen the coalition inflict a variety of penny-pinching measures targeting older Australians. It is very important to run through the extent of this attack on the living standards of older Australians by this government over the last six years. Despite promising otherwise, the coalition has put through a swathe of budget measures that have led to real cuts in the pension. From 1996, changes to the deeming rules cut pensions by up to $4 per fortnight, with a total of $23 million in pension payments cut. From 1997, the abolition of the earnings credit scheme for pensioners who undertook occasional work cut up to $50 per fortnight from pensions—a total of $19 million in pension payments cut. In 1997, changes to rent assistance for people in shared rental accommodation resulted in cuts of up to $20 per fortnight—a total of $30 million in pension payments cut. From 1999, sneaky new daily payment calculations effectively cut pensions by up to $10 per fortnight in the pension payment immediately following the twice-yearly pension increases—a total of $100 million in pension payments cut. Added to these are cuts to concessions which are on a par with the pension cuts, since the fortnightly pension payment has to be raided to make up for the loss of concessions. From 1996, pensioners and retirees with concession cards lost access to the free dental care that they had had under Labor's Commonwealth dental program. Average pensioners now pay over $100 a year in dental costs from their own pocket. From 1996, pensioners and retirees with concession cards were forced to pay 20 per cent more for scripts, with out-of-pocket costs up an extra $26 a year—the total cut for cardholders was $308 million. From 1996, retirees with concession cards had free hearing aids stripped from the benefits—the total cost was $12 million. Since 1996, service fees for hearing aids have increased by $6.50 per visit. From 1997, the number of lump sum $500 pension advances was cut to only one advance per year—the total cut was $83 million. From 1998, the government cut the home equity conversion loan scheme that provided subsidised loans of up to $7,500 for pensioners. By not re-funding the program, the government cut $12 million. The $17.20 per quarter telephone allowance has become almost worthless, with GST on telephone bills eating up the amount and more. In the latest budget, the government are at it again. This time there is a hike in the PBS copayment. Last year, an election year, saw older Australians showered with gifts from the government: a one-off bonus, the extension of the telephone allowance to seniors card holders and broadened tax breaks for retirees. This was done all at once, to try and win back support which had been eroded by a savage round of cuts over the previous six years. Of course, the money that was given back last year is now going to be clawed back—clawed back as sure as the pension compensation was clawed back. The government went to the election with their promise on the GST, saying that there would be a four per cent pension increase. They did not tell anyone that they would be back six months later to take two per cent of that back in that famous Howard clawback. What we are seeing here now is more of that Howard clawback— 83VEmerson, Craig, MPDr Emerson—The `claw'.2V5Swan, Wayne, MPMr SWAN—The claw—always in there, gouging away; handing things out before the election and gouging them back with the claw after the election. That is why we cannot support this bill. We cannot support it because it is at one with the approach of the Howard government: it is mean and it is tricky. And when it comes to elderly Australians, the sick and the disabled, it is always at its meanest and always at its trickiest. That is the problem. We could have been persuaded to have supported this bill, but when this bill went to a previous Senate committee, the department and the government could not present evidence that the system was being rorted. If it were being rorted, we would be seeing much more substantial savings in the figures that are contained in this bill. We would certainly be seeing more substantial savings than those we are seeing. I think that points to the fact that the government's rhetoric about rorting is what it always resorts to in social security. Take the current proposals affecting disability support pensions. On day one after they were announced in the budget, the Prime Minister came into this House and accused all disability support pensioners of being rorters. The Treasurer was out there implying that they were undeserving because most of them had bad backs. This was supposed to blunt the political attack from our side of the House, which said, very simply: `Why do you have to cut the pension of someone with a disability by $52 a fortnight to assist them into work? If they are capable of working and need some training, couldn't you just provide that assistance? Couldn't you provide the rehabilitation? Couldn't you provide the skills training? Why is it necessary to have a pension cut first?' The truth is that the Howard government believes that the well-to-do in our community always deserve more, that they always deserve incentives. The low-income earners in the community always get less and they always get punishment. It is this double standard that is so evident in the recent budget and it is characterised by this measure. This measure may have had worth. If this measure was necessary to prevent rorting, to prevent circumvention of the income and assets test, the government might have had a case. But, when challenged in the Senate committee, they could not present the evidence, and the savings contained in this bill prove that they have not been able to find systematic rorting of the income and assets test. This measure is nothing more than a cost-cutting measure which is going to hurt some elderly Australians, and it is part and parcel of the government's attempt overall in social security to cut a gaping hole in our social safety net. That is what the proposals about the disability support pension are all about, as are the proposals the government have in the area of subsidised medicines. What we are seeing now after the election is the government clawing back some of the money that it handed out prior to the election. We have seen after the election the coalition announcing huge cuts in pharmaceutical concessions through an increase in the PBS copayment. We have seen it before.83VEmerson, Craig, MPDr Emerson—Did they mention that before the election?2V5Swan, Wayne, MPMr SWAN—No, they did not mention it before the election, as they did not mention it before 1996, when they engaged in these sorts of cuts. It is a case of one thing before the election and another thing after the election. The government are back there with `the claw'—clawing back all of those things that were handed out prior to the election. Prior to the election, it was never mentioned that these things would be targeted, and now they go and claw them back—clawing back any benefit or concession that is given. Concession cardholders have been a constant target of this government over the last six years, and many elderly Australians have felt the full brunt and effect of that, particularly when they are sick.For pensioners, this can mean not being able to scrape together enough change for a litre of milk before the next pension is due. The government simply have no conception of what it is like to live on a low income. They have no conception of what life is like around the kitchen table for people surviving on meagre incomes. The only thing they are familiar with is life around the boardroom table. They have no idea about the daily struggle that people on low incomes in this community have. This really underscores the problem for coalition members. They are out there constantly dudding these groups in the community and eventually that will catch up with them. For those reasons we cannot support this measure which is here before us today.I will take a few minutes to talk about similar measures that the government is also introducing as part of the wider budget process. Today outside we will have a rally of people with disabilities; people who have come into the cold of Canberra to highlight the unfairness of the Howard government's approach to social security; people who represent the human face of those cuts of $52 a fortnight that this government intends to hand out to people with disabilities, people who should not be treated this way. These people should not be held hostage by the fact that this government has had a budget blow-out and by the fact that Peter Costello spent some $14 billion or $15 billion or even $20 billion in current and future budget surpluses in an effort to win the election and then came back after the election expecting people with disabilities and age pensioners to pay the price. For those reasons we cannot stomach the hypocrisy of the government's approach across the board in social security and we will not be supporting this bill. 11:46:003802Secker, Patrick, MPMr SECKER848BarkerLP10—I think it is a bit rich for the member for Lilley to suggest that this bill, the Social Security and Veterans' Entitlements Legislation Amendment (Disposal of Assets—Integrity of Means Testing) Bill 2002, will affect those pensioners who can hardly scrape enough together for a litre of milk. We are talking about pensioners who are giving away $10,000 a year, so I think they can certainly buy lots of litres of milk with that sort of money. I rise today to join the debate on this bill. While its title might sound quite a mouthful, the purpose of this piece of legislation is to reduce the opportunity for people to `serial gift' assets with a view to increasing their social security payments as a result. In many cases it would appear that gifting has become a favourite tool for pensioners who, often on the advice of their financial planners, are disposing of assets to enable them to qualify for increased support entitlements. This is inconsistent with a targeted, needs based, income support system and the stated goal of encouraging people to support themselves wherever possible.If we continue to allow people to increase their pension by gifting their assets, we continue to allow people to decrease their ability to support themselves and so place further strain on the social security system. If we continue to allow people to give away $10,000 a year, year after year, we are sending out the message that it is okay to voluntarily reduce your means of supporting yourself, at the cost of the public purse. In keeping with this, the government has introduced this bill to legislate for a new five-year gifting free area of $25,000. Where people choose to gift more than $25,000 worth of their assets over five years, these gifted assets will be considered as deprived assets for that period.We are not talking about people who do not have the money to buy a litre of milk; we are talking about those who can give away $25,000. It is envisaged that, out of the 1.8 million pensioners that we support in Australia, only 4,000 pensioners will be affected by this change, and in fact no-one will be affected until 2004-05. In saying that, I think it is very important to note that this piece of legislation does not change existing arrangements that allow people to give away $10,000 in a single year without it affecting the amount they are entitled to receive as a social security payment. A pensioner's capacity to help children or grandchildren in response to one-off events is not affected, as the ability to gift up to $10,000 without affecting their pension will still be available under the new law. Pensioners can still give away as much as they like; but the new rules reduce the scope for pensioners with substantial assets to use serial gifting to increase their pension.Under current laws, an asset tested pensioner who gifts $10,000 a year has the potential to increase his or her pension by $780 per annum up to a point where he or she becomes a maximum rate pensioner. As I have already said, this goes against the purpose of our social security system, which is in place primarily to assist those who are unable, for whatever reason, to assist themselves. With all this in mind, this government, being the responsible government that we are, sat down and thought about what we could do to make the system fairer for everyone. While we do not want to discourage and disadvantage people who want to gift an asset to help their family, we do have to be responsible and manage the system to ensure its future sustainability. For this reason we decided to allow a pensioner to gift up to a total of $25,000 over a five-year period before their entitlement is affected, to stop the practice of serial gifting. I think that is quite a reasonable amount to come up with.Under the new laws an asset tested pensioner who gives away $10,000 a year over five years may get an increase in their rate of pension of $780 per annum in the first and second years, half that in the third year and nothing in the fourth and fifth years. It is best exemplified by this scenario. Say a pensioner—let us call her Flo—gives $10,000 to her eldest son on 1 July 2002, $10,000 to her daughter on 1 July 2003 and $10,000 to her youngest son on 1 July 2004. In this scenario, Flo has gifted over three years $30,000 worth of assets, quite a considerable amount of money. So how does it affect her pension? Under the rules of this legislation, Flo is allowed to gift $10,000 a year, up to a total of $25,000 over five years. As Flo has gifted $30,000 in three years, the new law will affect her, and I will explain how.For the first two years, 2002 and 2003, Flo gifted $10,000 each financial year, as is allowed, and therefore no deprived assets are assessed. Flo's pension may increase as a result of those gifts—up to $780. However, in the third year Flo gifted a further $10,000, bringing the total of her gifts for the three-year period to $30,000—over the $25,000 threshold as previously determined and part of this legislation. So while this gift is okay—as pensioners can gift up to $10,000—the over-$25,000 rule applies and Flo's pension will be affected accordingly in the third year. Over a rolling period of three years, 2002-03, 2003-04 and 2004-05, Flo gifted $30,000. Flo gifted $5,000 above the $25,000 threshold and therefore $5,000 will be treated as deprived assets and will still be counted as part of Flo's assets for five years from that financial year. Flo's pension may still increase on 1 July 2004, however, because the gift did not exceed the $25,000 free area in rule 2. However, $5,000 will continue to be assessed as part of Flo's assets until 1 July 2009. If Flo kept this gifting pattern up for six years—that is, she gifted $10,000 a year for six years—Flo's pension may once again increase in the sixth year.As I have said previously, this legislation is by no means designed to discourage people from offering support to their families. This legislation is simply a responsible approach by this government to prevent serial gifting by pensioners in order to increase their pensions. The suggestion that this bill in an attack on people's right to support their families is ludicrous. Allowing people to serial gift would go against a goal of the income support system: to encourage people to support themselves wherever possible. We have retained the right for pensioners to gift up to $10,000 a year without it affecting their entitlements and without them having deprived assets assessed. The new $25,000 free area over a five-year rolling period over and above the deprived assets will only affect those who gift large amounts regularly. As I have said previously, we estimate this will affect only around 4,000 age pensioners out of a total of 1.8 million. And these people will not be affected until the 2004-05 financial year. The legislation still allows pensioners to respond to one-off events to assist their families without it affecting their support income entitlements.Under the current laws, there is an incentive for pensioners to help their family members and others. We have encouraged them to gift their assets up to $10,000 a year, by offering an increase in their pensions of up to $780 a year—and this continues up to the point where the pensioner reaches the maximum rate. This incentive has been reduced by the new $25,000 free area. However, there is still the possibility for some pensioners to reach maximum pension rate under this scheme by strategically gifting their assets. For example, by gifting $10,000 in years 1 and 2, gifting only $5,000 in year 3, and nothing in years 4 and 5—thereby remaining under the $25,000 free area—and then repeating the process in years 6, 7 and 8, pensioners can still benefit from increases in their pensions as a result of gifting. Another way that this can be done is by gifting $5,000 a year for five years or $8,333 a year for three years. That way they would not be affected. However, this would not happen until year 8, as opposed to year 5 under the current rules.It is important to remember that this legislation is trying to decrease serial gifting. It is not a desirable practice if we consider the longevity of the social security program, and it goes against the very goals of the social security program. This bill is trying to reduce the scope for pensioners to gift money and other assets; however, it does not stop anyone from making gifts. Where the gifts exceed the free areas, the rules simply mean that a part-rate pensioner may not necessarily get an increase in their pension as a result of voluntarily gifting their assets and thereby decreasing their ability to support themselves.We are trying to think about the sustainability of social security and veterans' entitlements, as with the PBS and the disability support pension. We have an obligation to the Australian people to ensure that they are secure in years to come, and if we allow practices to occur which jeopardise this we are not being responsible and we are not being considerate to all those pensioners who rely solely on the pension to survive.This legislation still allows people to gift any amount they choose but, depending on the amount that they choose to gift, they may be assessed as having deprived assets, which in turn will affect their pensions. We need to face the fact that the people who attract deprived assets do so because they have gifted large amounts of money which, had they not gifted, would have supported them. Instead, they have voluntarily chosen to gift these assets and thereby increase the burden on the public purse because they have reduced their assets.Deprived assets are treated as part of a person's assets for five years from the date of the relevant gift. They are treated as a financial asset and are subject to the income deeming rules. It is important to note that it does not matter how much cash a person gifts, the new rules cannot result in a reduction in a person's pension. Under the current $10,000 gifting in a single free year area, if a person who is subject to the income test were to gift an asset such as a second property, their pension may go down as a result of the existing deeming rules. A decrease could only occur where actual income generated by the non-financial asset was less than the relevant deeming rate. This decrease would not occur as a result of the measures set out in this bill.Another point I make about this legislation is that we have been very careful to avoid any double counting of asset disposals. While ever the rules of both the $10,000 single-year free area and the $25,000 over a five-year rolling period exist, we have consciously acted to avoid double counting. In either case, gifts in excess of the free areas result in the deprived asset being assessed. This deprived asset is treated as a part of a person's assets for five years from the date of the relevant gift. The rules operate in this order. Apply rule 1, which says that a person can give $10,000 in a single year and not attract a deprived asset. Then apply rule 2, which says that a person can gift a total of $25,000 calculated over a rolling five-year period before attracting a deprived asset.For example, if a person gifts $25,000 in the first year, the gift exceeds the $10,000 in a single year. Therefore, a deprived asset of $15,000 is assessed as a deprived asset for five years from the date of the gift, which is no different from the present situation. However, as the second rule takes into account any deprived assets, it means that a person who has not used up all of the free area can still make gifts of $10,000 in the second year and $5,000 in the third year, because the $15,000 over the free area made last year is not counted as a gift but rather as a deprived asset. It is important that we have made the effort not to count asset disposals twice. In the above example, the person would still be able to gift a further $15,000 over the next three years, despite having already gifted $25,000.This legislation intends to enact these rules by amending the relevant sections of the Social Security Act 1991 and the Veterans' Entitlements Act 1986. This legislation will also change the applicable period so that the provisions operate on the more widely understood financial year as opposed to the previous provisions, which operated on a pension year basis, which is actually the anniversary of the day that the recipient started to receive income support. This amendment will make it much easier for pensioners to understand when and how often they are entitled to gift. And anyway, in the majority of cases, pensioners would probably not remember what day they commenced income support. The new rules will only apply to gifts made on or after 1 July 2002, and so it is not retrospective and will not affect any pensioner until the 2004-05 financial year, some three years away. A summary of the major features of the bill is: a new rule to provide for a free area of $25,000 over and above already deprived assets, to operate over a five-year rolling period, with gifts in excess of this free area assessed as a deprived asset for five years; retention of the existing rule that provides for a free area of $10,000 in a single year; retention of the existing rules for amounts disposed of before 1 July 2002; and a change in operation of the rules from the pension year to the more widely understood financial year.This is a very responsible piece of legislation. I am very proud to be part of the responsible government that has introduced it. We could have simply sat back and let things continue the way they were and let people who are able to support themselves in part simply to give their money away to increase their pensions. Instead we chose to stand up and act. Once again we have taken the responsible step of looking after the future of our elderly instead of simply worrying about the present. We have considered the sustainability of both social security and veterans' entitlements and have taken these steps in response to that.The measures taken in this bill will have a great financial impact on the social security system. By the year 2006-07, affected programs under the Social Security Act 1991 will have benefited from a $7.2 million program saving, while affected programs under the Veterans' Entitlements Act 1986 will have benefited from a $1.3 million program saving. This is yet another example of a responsible government acting to ensure the future of our social security system and to ensure the future security of the elderly. It is another example of the Howard government's ability to make the choices that need to be made and to take tough decisions where necessary. We are committed to offering fair assistance to all Australians, and this legislation is testimony to that. I take this opportunity to congratulate my colleague the Minister for Family and Community Services, Senator Amanda Vanstone, and her department for devising such a balanced piece of legislation. I commend the bill to the House and urge those opposite to do the same.12:05:003806Hall, Jill, MPMs HALL83NShortlandALP00—I rise to oppose the Social Security and Veterans' Entitlements Legislation Amendment (Disposal of Assets—Integrity of Means Testing) Bill 2002. I do not see from the government the same level of fairness, equity and care for older Australians that the previous speaker sees in this legislation. Rather I see a government that is launching itself on a cost-cutting exercise, one that is not considering the needs and feelings of the pensioners who will be affected by this. I am here to talk not about recipients of income support but rather about people—pensioners, mums and dads of families, people who will be affected gravely by this legislation.I have to say, though, that this legislation is better than the previous legislation that came before the parliament seeking to reduce the amount of money that pensioners could gift each year to $5,000. At least this legislation allows for that $10,000 gifting, which can be used when there is a financial crisis within a family. Under the current social security and veterans affairs rules, pensioners are able to gift $10,000 each year. This effectively reduces that to $5,000 by taking it out over a five-year period to $25,000. It is also important to mention at the very beginning that this $10,000 rule has been in place for some time. The gifting rule dates back to the assets test in 1985. In 1995 these provisions were relaxed so that up to $10,000 could be disposed of each pension year, without sanctions. If you look at inflation over that time, the amount of money that pensioners are able to gift has declined significantly.I cannot help but feel that this government is not a pensioner-friendly government. It has waged many attacks on pensioners. The most recent of those attacks were the changes to the Pharmaceutical Benefits Scheme. I spoke last night on that legislation and on the concern and anxiety that it is causing within the pensioner community. Not only will this legislation reduce the amount of a pensioner's disposable income; it will reduce their ability to dispose of their income in the way that they choose. It will particularly affect their ability to offer support to their families at times of need. The Pharmaceutical Benefits Scheme is a real impost on most pensioners. I have spoken to many pensioners and I am yet to find one who is not on at least six different types of medication. When you couple that cost with the impact of the GST on pensioners and on their families, a need is created. Many pensioners look to gifting money to their families to support them because of the shortfalls in the amount of money that their families have.Getting back to the terms of the bill, the amount of $10,000 is deemed to earn 10 per cent interest for five years and the value of the disposable assets above the limit continues to be included and calculated. In 1991, it was the calculation of the value of a person's assets to meet the purpose. This change will impact on that dramatically. The amendment in 1999 to the Social Security Act, as I mentioned, sought to reduce that to $5,000. The government has argued that the gifting of $10,000 has become the favoured tool of financial planners, that it has become a tool that pensioners sitting at home use to reduce their assets so as to maximise the amount of money that they can receive through their pension from Centrelink. I have news for the government: there are many other financial tools being used to manipulate the system. These tools are being used by people who have a great amount of money and who are still able to receive the pension. But the government is not looking at these people. The government is concentrating on the one tool that the average pensioner uses to support their family in times of need. The position I am arguing is supported by welfare groups. They defend the $10,000 limit because they believe that it provides scope for gifting to family members when they are in financial difficulties. I can refer to my own family. There was a situation where a relative became very ill and, over a period of time, their income level was reduced dramatically. This person was faced with the situation of either losing their home or finding some way to maintain the payments and keep their home. This situation occurred over a period of three years. The amount of money that that person's parent was able to gift was over $25,000. The pensioner who gifted that money now has under $20,000 in the bank. This is not a wealthy person but a struggling, everyday kind of person who was not looking to bypass the requirements of the act or to get money by reducing their asset base. This person was not a victim of some ruthless financial planner that had come up with some scheme to enable them to legally defraud the system. Rather, this was an everyday parent whose child got into severe financial difficulty, not because they chose to put themselves in that position but because of a consequence of life that all pensioners and all families are faced with from time to time. The parent was only too happy to be able to offer that support.As a parent I know that, if any of my children were to ever need some sort of financial support or assistance like that, I would be prepared to jeopardise my own financial security—and that is what happens. I have had pensioners say to me that they feel caring for their child, caring for their family, is much more important than caring for themselves. Many pensioners put themselves in situations where they are living in poverty.There are many areas in which this government has attacked pensioners. It has attacked pensioners' feelings of security in relation to aged care. I regularly visit my senior citizens and pensioner groups and they are constantly telling me their concerns about their financial security; they are constantly telling me about the problems that they have in meeting their financial commitments and the problems that their families are having.I spoke a little earlier about the Pharmaceutical Benefits Scheme. As recently as two or three weeks ago, I bumped into a pensioner couple in one of the shopping centres. They told me what I thought was a rather sad story, and it is a bit of an indictment on the government. They had two of their grandchildren with them because the mother and two of the other children were sick. They had been to the doctor, and they had had to buy some medication which cost the family $98. They found it very hard to come up with the money. The grandparents loaned them the money and had taken the other two children so that they did not become infected with the virus. It was outside the family's ability to provide the support their children needed.This demonstrates how important pensioners feel it is to be able to offer that support to their children, how important it is to be there in times of need and how important it is for pensioners to be able to offer financial assistance. This legislation, on a different level, is attacking the ability of pensioners to offer that support to their families, as the previous speaker detailed. The legislation will retain the $10,000 limit, but it will add a further limit of $25,000 over a rolling five-year period. The change is intended to reduce the scope for pensioners to use regular gifts to increase the rates of payments that they receive.I am sorry, but I just do not think the government are out there talking to the real people. They are out there talking to recipients and they are out there talking to people about income support, but they are not out there talking to the mother, the father or the children. They are not out there talking to people about how they manage with their pension and how much support their families need. It is just so hard, so difficult, for families to survive these days, and that is why it is so vitally important for parents to be able to assist their families.There is another aspect to this, as well. Recently a constituent came to see me who had gone to see a financial planner. He was retired, and his mother was going into a nursing home. She had been assessed by ACAT, and it was determined that the right place for her was in a nursing home. He visited the financial planner and he contacted Centrelink, but the advice that he was given was incorrect. He sold the house that she was in, and he and his sibling, not being wealthy people, paid off their homes with that money. He subsequently found out that the money is still considered part of his mother's income and assets. This has created a situation of real financial hardship because this person is not wealthy.The point I am trying to make is that the information that is given to people by financial planners and the information that is given to Centrelink about gifting is very obtuse, and it also creates a lot of problems for a lot of people. A really important initiative that the government could take would be to get good, clear information out there to pensioners and to have an education system in place that advised pensioners of their rights. This would be far better than attacking them, attacking their ability to make a choice and attacking their ability to assist their families, in the way this legislation does.The government has yet to provide evidence that the system is being tightened to prevent systematic abuse by pensioners. Despite the promises that the government has made to provide the opposition with this evidence, we on this side of the House have yet to see anything to support this contention. Rather, I think the government is targeting a group of pensioners that is easy to target. It is an easy solution. You hit where it is easiest. It is similar to the way in which the government is approaching the Pharmaceutical Benefits Scheme, where it is reacting with a short-term, knee-jerk response in relation to the increasing costs of pharmaceuticals.The current $10,000 limit on gifting has never been indexed, and it remains at the same level it was when it was introduced, so that is automatically reducing the value of it. The government has not taken any unilateral action to cut down on financial planning. The approach that is adopted by financial planners enables people with significant assets—many hundreds of thousands of dollars worth of assets—to actually get around requirements and to claim the pension. This really does bring into question the government's approach to tackling this issue. Groups such as the Australian Pensioners and Superannuants Federation have argued that more generous gifting provisions allow older Australians to support their families, as have welfare groups. Once again, this is legislation introduced by a mean-spirited government that is attacking vulnerable pensioners, and it really shows that it has absolutely no respect whatsoever for our senior citizens and pensioners. 12:22:003808Johnson, Michael, MPMr JOHNSON00AMXRyanLP10—I am delighted to be able to say a few words, put some commonsense back into the debate and follow the member for Shortland. Before I do so, I extend a warm welcome to the students in the gallery. I do not know where you are from, but welcome to our nation's parliament in Canberra. I am pleased to rise today to support the Social Security and Veterans' Entitlements Legislation Amendment (Disposal of Assets—Integrity of Means Testing) Bill 2002, which aims to provide a measured response to the problem of serial gifting. Serial gifting refers to a scenario where pensioners make large gifts year after year in order to qualify for an increase in their pension. This bill aims to do two things: to ensure that Australia has an income support system that is needs based, thereby encouraging people to support themselves where possible; and to continue the process of welfare reform initiated by the Howard government. It is the Howard government which is a reform government, unlike those opposite.It is important to put some context into the debate here in the parliament. After 13 years of a Labor government, welfare reform in Australia was very much needed. The previous Labor social security minister boasted that he had solved the problem of people cheating and abusing the system. Despite this remarkable claim, the coalition government has been able to save taxpayers over $1 billion since 1996 by closing many of the loopholes in Labor's legislation. Of course, the money the government has is the people's money—that must always be remembered. The benefits of some 640,000 people who were receiving too much were reduced. It is important to remember that when the Howard government came to office in 1996 the Commonwealth debt was $96 billion. The Labor Party was, with its policy, unable to address financial management. Only the Howard government has been able to do that. After 13 years of Labor there were an estimated 1.9 million people living in poverty, including 600,000 children aged under 15.I am delighted the member for Rankin is in the chamber, because he worked for the former Labor Prime Minister Bob Hawke who, at the 1987 election campaign policy launch, said those very famous words: `By 1990 no Australian child will be living in poverty.' I was wondering whether the member for Rankin had advised the former Labor Prime Minister to say those words. It is blatantly obvious that the Labor Party has no credibility in this policy area at all. The member for Lilley has no credibility whatsoever. This government governs for all Australians; it does not just govern for any sectional group as the Labor Party, and the member for Lilley himself specifically, do.Between 1976 and 1992 the number of households in Australia earning between $22,000 and $72,000 a year declined from 62 per cent to 57 per cent. The number of people earning less than $22,000 doubled from 15 per cent to 30 per cent. Labor wasted $2.4 billion in payments to people who were not entitled to benefits. Under Labor, the unemployed could get the dole without putting anything back into the community. Remember: this is the people's money and the government has a responsibility to manage the people's money with great care. After 13 years of Labor the Australian people were left with a social security system that was too complex, making it very difficult for ordinary citizens to understand their entitlements. Labor clearly left Australia's social security system in a complete mess.The Labor Party is the same party that has opposed the Howard government's measures aimed at ensuring the social security system is fair and targeted to help those who need it the most. Labor has criticised the coalition's efforts to crack down on fraud, and has opposed job seeker and Work for the Dole measures. These are great accomplishments of the Howard government. I want to remind the Australian people, and indeed the people of Ryan in my constituency, that Labor has opposed Work for the Dole, which is a very popular initiative indeed. Of course, that comes as no surprise to the parliament because all Labor is about is opposing everything. Labor has never been serious about stopping fraud and noncompliance in the social security system. It seems to forget that it is the obligation of any government to ensure that the hard-earned money of the Australian people is only given to those Australians who genuinely need it.This bill is all about making sure that the most deserving people receive valuable money that the people of Australia contribute to the running of the country. Unlike Labor, the coalition government has always had a strong track record in social reform. Family allowances, rent assistance and the automatic indexation of pensions were all initiatives of coalition governments. The process of reform has been invigorated and continued by the Howard government. As the parliament would be aware, in the 2001 budget the government announced the first major step in its strategy to reform the welfare system—and this was a very fundamental step. The Australians Working Together package placed a strong emphasis on encouraging and supporting economic and social participation. The four-year forward plan aims are to reduce the unemployment rate in Australia, to reduce reliance on income support and to strengthen the communities of Australia. There is no doubt that this package is one of the most far-reaching and important initiatives in welfare reform that this country has seen. I would just like to take a few moments to point out some of its key features. Under the A Fair Go for Mature Workers initiative, $146 million over four years will give working age people over 50 more encouragement and assistance to participate in the work force. Under the A Better Deal for People with Disabilities initiative, $177 million over four years will improve outcomes for people with disabilities and temporary incapacities through access to education, training and a better assessment of people's skills and qualifications. Under the Getting People the Right Help initiative, $144 million over four years will ensure that disadvantaged Australians get the right help through better assessment, providing expanded and appropriate help to those with severe or multiple non-vocational barriers to participating in our work force. Information technology is also an important element that is being addressed. Under the Helping Parents Return to Work initiative, $191 million over four years will encourage parents with school aged children and who are receiving the parenting payment to prepare to return to the work force as their children get older. This will be done through an annual interview with a personal adviser once the youngest child reaches primary school.Another key initiative that I would like to point out is More Child Care Places. Under this initiative, $15 million over four years will provide more outside school hours care places and provide child-care fee assistance to more parents through the Jobs Education and Training program. Under the Helping People Find Jobs initiative, $297 million over four years will be spent on better employment services, training credits, literacy and numeracy places and standardised mutual obligation requirements. Under the Help to Participate initiative, $521 million over four years will be used to introduce a working credit to encourage income support recipients of work force age to take up full-time, substantial part-time or casual work by allowing them to keep some of their benefits. Under the Community and Business Engagement initiative—this is a government that supports small business in Australia—$22 million over four years will be provided to allow the Prime Minister's Business and Community Partnership to encourage companies to employ more Australians with disabilities, older people and parents who want to return to the work force. Under the Promoting Self-Reliance for Indigenous People initiative, $83 million will be provided over four years to support community participation agreements in over 100 remote communities, giving much opportunity for Indigenous Australians to get into the work force and increasing education and training assistance.The 2002-03 budget builds on welfare reform initiatives. The coalition government is a government that is committed to welfare reform in Australia, and the Next Steps in Welfare Reform package takes the process one step further by providing better targeted assistance to job seekers through the Job Network and by increasing support and requirements for people who are receiving the disability support pension. I want to take this opportunity to acknowledge the wonderful job that the Minister for Family and Community Services is doing in her portfolio. This minister has always been very supportive of the process of reform, and I am pleased that the minister will continue to support reform. It is this government, not the opposition, that is addressing much needed reform in all facets of Australian policy.This bill is another testament to the coalition's commitment to reform. The measures in this bill are designed to reduce the scope for pensioners to give away money and get an increase in their pension as a result. I know many of my constituents, the people of Ryan, will be keenly supportive of the government's initiative. The people of Ryan are very keen to ensure that their hard-earned revenue goes to those Australians who are genuinely in need of support. This bill does not stop anyone from making a gift. I think it is important to put that into some perspective. It was a bit rich for the member for Shortland to try to promote a different interpretation of the bill. Pensioners can still give away as much as they like, but the new rules reduce the scope for pensioners with substantial assets to use serial gifting to increase their own pension.A pensioner's capacity to help their children or grandchildren in response to one-off events is not affected, and the current annual gifting free area of $10,000 will remain unchanged. I have news for the member for Shortland on that point. This much needed reform will address loopholes that currently exist and allow Australians to take advantage of the situation. It is another initiative to ensure a fairer system for veterans, for pensioners and indeed for all Australians. It is not penny pinching, as the member for Lilley says. He ought to remember that any Australian government has an enormous responsibility to spend the people's money equitably and spend it on those who are most deserving of it.I would like to say a few words on an important constituency in Australia, specifically the veteran community. Almost 3,000 veterans reside in my electorate of Ryan, and I am very proud to represent them. The Ryan community is very lucky to have a vibrant and active veteran community. Within Ryan, there are five very active local RSL subbranches, and I might just mention them. They include Sherwood-Indooroopilly subbranch, Centenary subbranch, the Toowong subbranch, the Kenmore-Moggill subbranch and The Gap subbranch. I want to take this opportunity to congratulate them on the good work that they do in the community, not only in the interests of their members but also for older Australians who live in the electorate of Ryan. They are very dedicated Australians, and they do all they can to enhance the lives of young people as well as veterans in the electorate.On Anzac Day I had the opportunity, as I am sure all members of this parliament did, to attend many services. I was particularly honoured to attend ceremonies at The Gap, Sherwood, Kenmore and Corinda. I was very pleased to know that many people in the Ryan community supported these Anzac Day ceremonies with great enthusiasm. It is vital that the service our veterans continue to give in our community is recognised by members of this parliament. It is well known that the number of veterans in our community is decreasing. In the electorate of Ryan, we have Mr Eric Abraham, who recently turned 104, and of course Australia has recently seen the passing of Mr Alec Campbell. All members of this parliament must continue to honour veterans' contributions to Australia. This is what this bill does: it honours the contributions of veterans in every form. The coalition believes very strongly that the Australian veteran community deserves generous support, care and compensation. The Prime Minister has a direct personal interest in the veterans of our community. The coalition government is dedicated to the initiatives of reform, and this bill addresses that, as do the recently announced budget measures. This bill ensures that finance is equitably distributed to the most deserving people. It is not surprising that in 1996 the opposition left behind a system of veterans' benefits that was absolutely riddled with anomalies. They largely neglected veterans and war widows living in regional, rural and remote areas, although they account for some 30 per cent of the total veteran population. The Howard government is continuing the process of welfare reform. Welfare reform is all about ensuring that the most needy in our community receive the support of the government and the nation. This bill does that. It is another example of the coalition government's commitment to ensuring that the welfare system provides for those who need it. As we all know, reform must continue in order to secure the financial security of future generations of Australians. Right now, and for at least the next decade, our budget situation is in good shape. This is very much attributed to the economic credentials of the Howard government and Treasurer. However, it cannot be sustained. Current and future generations will face higher taxation impositions if revenue is not appropriately targeted. This year's Intergenerational Report brought down by the government outlines three key social areas that need to be addressed—health, aged care and age pensions. It is appropriate that this bill plays a part in the strategy of making sure that the limited revenue goes to the most needy in our community. This government, unlike some members opposite who spoke previously, cares about those on low incomes. The member for Lilley and the member for Shortland said that this government is not interested in the low-income earners of Australia. The government cares about low-income earners and that is why we initiated certain reforms—in the budget and in the PBS in particular because it was unsustainable. This bill is part of the overall package that will ensure the Australian government acts responsibly for the Australian people. I certainly encourage members opposite to support this bill. It is vital that the Commonwealth continues its policy of supporting veterans and other Australians with these measures and ensuring, in particular, that welfare reform continues. This bill is about supporting the needy, not the greedy, and it does that adequately. I encourage all members opposite to support the passage of the bill today and to act responsibly, as an opposition should. If they want to get into government they need to show the Australian people that they are deserving. Quite clearly, at this stage they do not deserve to be in government and that is why the Australian people very strongly voted for the coalition in the November election. I commend the bill to the House and support very strongly the remarks of my colleague the member for Barker.12:31:003812Grierson, Sharon, MPMs GRIERSON00AMPNewcastleALP00—I rise to oppose the Social Security and Veterans' Entitlements Legislation Amendment (Disposal of Assets—Integrity of Means Testing) Bill 2002. The bill seeks to reform the provisions of the Social Security Act of 1991 and the Veterans Entitlements Act of 1986, as they relate to the gifting of assets by recipients of income support payments. The government puts this legislation before the Australian people because it claims that deliberate exploitation of the gifting provisions is a serious and significant problem in our country and that it requires a tough stance. And remember: this is a government that claims it is tough on just about everything! For a projected saving of $8½ million over five years, the legislation will be particularly tough on a considerable number of people.Obviously there is a need for guidelines that prevent and discourage people from disposing of assets just to receive a support payment and the benefits that might accompany some of these support payments. In fact, such deterrents are accepted and have been in place in Australia since 1976 when an income only means test was introduced. Under the 1976 provisions, where a person attempted to dispose of income so that they could qualify for a pension or a higher rate of pension, the disposed of income was deemed to be actual income and counted for determining the income test provisions. In 1985 the further concept of an assets test was introduced. This test allowed for the disposal of assets up to the value of $2,000 per annum for a single person or $4,000 per annum for a couple. Any excess disposal above these amounts was assessed under the assets test, with the assessed value of disposed assets reduced by 10 per cent each year.In 1991 the Labor government modified these provisions so that up to $10,000 could be disposed of each year without sanctions applying. The Labor government of the time recognised that the previously low limits denied the reality of the Australian way of life where families helped each other out in times of need. The amount was also increased so that in cases where disposal of income was relatively minor the impact on social security entitlements would also be minor. A fairer and more realistic outcome was achieved. Constraints were still in place to discourage abuse, and amounts above $10,000 were deemed to earn 10 per cent interest for five years. The excess above the limit also continued to be included in the calculation of the value of the person's assets for the purpose of the assets test. That was fair but firm; responsible but realistic; policy based on sensible and reasonable principles, Labor principles. In 1999, the Howard government attempted to modify the 1991 provisions and proposed reducing the $10,000 limit to $5,000. The government then claimed that the $10,000 limit was being exploited by financial planners. Apparently, numerous Australians were giving away $10,000, and many were giving away $10,000 every year, just to receive social security support payments. No evidence or data was put forward to substantiate or quantify this assertion, but the government was determined to be tough on any exploitation it perceived of taxpayers' money. One could only wish that the Howard-Costello government had been just as tough on foreign currency speculation, instead of incurring a $1.9 billion gambling debt on behalf of Australian taxpayers.The 1999 bill was considered by the Senate Community Affairs Legislation Committee and was defeated in the Senate by the ALP and the Democrats. Welfare groups applauded this position, recognising that $10,000 was a realistic and reasonable amount to be able to give to family members in need. So the Howard government was temporarily discouraged, but still determined to demonstrate its toughness. The Social Security and Veterans' Entitlements Legislation Amendment (Disposal of Assets—Integrity of Means Testing) Bill 2002 under consideration in this House today has been submitted to demonstrate that the government can once more flex its muscle and be seen to be tough on `Vanstone's villains', those in our community who seek to exploit the government's generosity—age pensioners, veterans, widows, carers of those with disabilities, and youth allowance recipients, to name just a few potential supposed rorters. The current bill retains the $10,000 limit, but adds a further limit of $25,000 over a five-year rolling period. In this way it attempts to reduce the scope for social security recipients to use regular gifts to increase the rate of pension payment they receive. It also introduces the use of financial years rather than pension years as income years. Although the current bill before this House has been modified and is an improvement on previous proposed legislation, it is still legislation which we on this side of the House cannot support. This legislation clearly illustrates the major differences in policy and principles between the ALP and the coalition with regard to administering income support payments.Firstly, the government has provided no evidence that disposal of assets and gifting provisions are being used for systematic abuse and for avoiding income test restrictions. The recommendations within the bill remain unsubstantiated by data or evidence. As a relatively new member, I am constantly amazed by the lack of accountability required of government departments and by how rarely decisions are based on measured outcomes, cost-benefit analysis or costed comparisons. Instead, knee-jerk policy that conforms to outdated paternalistic dogma still appears to dictate this government's decision making. The introduction of principles of responsible quality management delivering the best outcomes for people is long overdue in the Howard government's performance.Secondly, the legislation retains the $10,000 limit without any indexing. This limit has not been altered for 10 years and therefore fails to reflect the significant reduction in real economic value of the $10,000 over time. So the principle of fairness does not apply in this legislation either. This is particularly relevant when we take into consideration the introduction of the GST by the Howard government, a tax which imposes a 10 per cent cost burden on all goods and services for all people receiving income support payments. Failure to index this amount also fails to recognise the significant increases in the cost of living that affect all recipients—for example, the massive increases to insurance premiums and the rising cost of mortgage payments and credit charges due to rising interest rates prompted by the government's reckless spending on election sweeteners, the Pacific solution and foreign currency gambling and the budget deficit delivered to Australia by the Treasurer.Add to this the recent budget measures that seek to increase the cost of prescriptions and you see that the $10,000 limit is no longer a fair amount and should indeed be indexed to reflect real cost of living increases. Throw in the threat of tighter restrictions on the disability support payments and the failure of the government to reintroduce the Commonwealth dental health program or free hearing aids and hearing tests, and you can see the need for proper indexing and fairness to influence government decision making.Thirdly, if, as the government purports, systematic exploitation of income support guidelines by financial planners is the order of the day, we might have expected to see a raft of proposals to minimise action by financial planners—proposals that target those who limit income to avoid taxation—and to target those who gain access to support payments. But consistency in policy and practice is not a feature of this government's decision making. Instead, a mean-spirited approach that targets those who can least afford to pay or least afford to lose income support seems to be a principle that this government has well and truly mastered.Unlike the Howard-Costello government, Labor stands for responsible, fair and consistent decision making that takes into particular consideration the needs of the disadvantaged in our community. This legislation is not about cracking down on social security rorters. This legislation is a further attack on those who can least afford it, by a mean-spirited government determined to strip Australian recipients of social security payments of their assets and income before they can receive any support. This legislation is also opposed by the Australian pensioners group and the superannuation federation. These organisations agree with us that the legislation fails to recognise that families sometimes need financial support. Times of hardship and need are unpredictable. Divorce, education, health crises, accidents and unemployment are all life events that have significant financial consequences. As is the Australian tradition, families pitch in. In targeting supposed rorters, this legislation punishes those who genuinely want to give their family a helping hand. It is important to note that, under this government, access to any income support payments has become more difficult and more onerous. Income and assets tests are strictly applied in a punitive way which means Australians must spend their savings and dispose of their assets before gaining any social security support in times of hardship. For these people, saving for retirement or becoming self-sufficient in the future is an impossibility. In this way, the government perpetuates reliance on social security support. However, the government does not apply income or assets tests when it wants to woo voters in election campaigns. There is no income or assets test for the first home owners grant, the baby bonus or the bonus to remain in the work force after turning 65. There is no income or assets test for receiving an establishment grant to set up a private school. This government displays gross hypocrisy in distributing taxpayers' hard-earned moneys. The government, it seems, can only be tough on the people who most need its support—the aged, veterans, carers, widows and those on disability payments and youth allowance.With my parliamentary colleagues the members for Charlton and Shortland, I recently met with a group of 40 carers who shared with us their burden in trying to deliver quality of life and quality of care to their family members. For them the social security system is already a maze that seems to limit them in very many ways and to add additional burdens and constraints to their daily lives—lives that mean little rest or respite, little time for themselves and very little time to plan for the future. The provisions in this legislation relating to income and assets tests applied to recipients of care will further complicate the ability of carers to provide access to quality care and activities for those they care for. And, under the Costello budget, if those they care for receive a disability support payment, they may find it even harder to receive the carers payment in the future. Carers such as those from Newcastle that I mentioned, through their dedication and commitment, are a valuable community resource and an asset that the government should reward, rather than punish with more burdensome and restrictive legislation.A further concern that this legislation prompts is the human and administrative costs of introducing these new provisions. In the mere six months that I have been the member for Newcastle my electorate office has responded to over 500 Centrelink related contacts. Every day, we help those who find the complexities and inconsistencies of Centrelink too difficult to navigate, and every day we see the staff of our three Centrelink offices struggling to keep up with their work demands. More legislative change for Centrelink staff to determine and more regulations for them to enforce and enact mean an increased workload for, and increased pressure on, them. It seems to me that they are not coping now, and so I despair at the further administrative burdens placed on them by this legislation.Finally, this legislation is yet another example of the continuing erosion by the Howard government of the social security safety net. I am not satisfied that this bill is either necessary or justified. The government has failed to put forward any evidence of widespread rorting and has failed to convince that considerable savings will result from this legislation. The real effect will undoubtedly be greater pressure on low-income earners and on those receiving income support payments. In my electorate of Newcastle, where the unemployment level is now the highest in the nation and the median income weekly levels are not high, this legislation will be a further blow to community prosperity.In putting forward this legislation, the government again reveals itself to be mean-spirited and out of touch with ordinary Australians. Its claims that the legislation is necessary because very many Australians are making annual gifts of $10,000 just to enable them to receive income support benefits will elicit a response of `I wish!' from many support payment recipients in my electorate. I urge the House to oppose this legislation.12:55:003815Anthony, Larry, MPMr ANTHONYXJ6RichmondNPMinister for Children and Youth Affairs10—in reply—I would like to thank all the members for their contributions to this debate, and I would especially like to thank the member for Barker and the member for Ryan. It is also interesting to note that even the member for Shortland was singing the praises of the legislation.This government is committed to the effective delivery of its income support measures. Part of this commitment involves encouraging people to provide for themselves where they have a capacity to do so. The Social Security and Veterans' Entitlements Legislation Amendment (Disposal of Assets—Integrity of Means Testing) Bill 2002 amends those provisions of the Social Security Act 1991 and the Veterans' Entitlements Act 1986 that set out how much a person or couple may give away as gifts without the value of those gifts still counting as part of their assets for means testing purposes.The current arrangements provide that, if a person or couple gives up to $10,000 a year, this may result in them getting a higher rate of income support. This is particularly the case for customers whose rate is affected by the assets test—that is, pensioners with quite significant levels of assets. If a person or couple gives away more than $10,000 a year, then the amount in excess of $10,000 is still counted as forming part of their assets for the next five years. Accordingly, the excess of the gift over the free area will not result in a further increase in income support over that period. The government considers that this annual $10,000 free area is generous, given that it is almost equal to the maximum single pension rate, which is around $10,670 per year. Nevertheless, the government recognises that there may be compelling reasons where, for example, family circumstances necessitate gifts of this nature. Accordingly, this bill will not change the rule concerning $10,000 in a single year. The government is concerned, however, that gifting has become—as the member for Barker recognised—a favourite tool for many financial planners, who exploit gifting to increase the income support entitlement of their clients.There is no denying that this occurs. There are a significant number of cases where such gifts appear to be an annual occurrence designed to reduce assets and increase income support. I will quote from an article written last Sunday by Noel Whittaker, who is very well known within the financial planning industry:In the 1999 Federal Budget, it was announced that the amount a pensioner could make as a gift each year without penalty was to be cut from $10,000 to $5,000. The enabling legislation was defeated in the Senate by Labor and the Democrats. They were not convinced by the Government's argument that “gifting” was a common practice used by retired people to gain access to a larger pension.One can but wonder where Labor and the Democrats obtain their information, as this has been a major financial planning strategy for years. And why not? For a pensioner assessed under the assets test, a gift of $10,000 increases their pension by $780 a year. That is an effective return of 7.8 per cent a year on the money given.Is it any wonder that this is perhaps not being used with the intent of supporting family members when they are in need, but as a way of reducing assets to gain pensions? People do this to increase their ability to access social security payments, rather than to provide assistance to family members in response to those one-off, compelling events.The bill addresses this problem by introducing a further rule. Simply put, the bill introduces a new area of $25,000, which will apply over a rolling five-year period and will operate concurrently with the $10,000 in a single-year free area. Any gift in excess of either of these free areas will be assessed as a deprived asset of that person or couple for five years, with the same effect as at present. The bill reduces the capacity of those with significant assets to use regular gifting strategies to increase their taxpayer funded income support entitlements. It is important to realise that no matter how much cash or other financial assets a person gives away, these rules cannot and will not result in their getting less income support than they receive before they make a gift. These new rules will apply to amounts disposed of on or after 1 July 2002. The bill also takes the opportunity to change the basis of the gifting rules from a pension year to a more widely understood financial year.Question agreed to.Bill read a second time.3816Mr ANTHONY (Richmond—Minister for Children and Youth Affairs) (1.01 p.m.)—by leave—I move:That this bill be now read a third time.Question agreed to.Bill read a third time.Bills3816R15303816Debate resumed from 21 March, on motion by Mr Slipper:That this bill be now read a second time.13:01:003816Latham, Mark, MPMr LATHAMK26WerriwaALP00—The Financial Sector Legislation Amendment Bill (No. 1) 2002 contains amendments to 10 pieces of legislation that govern the operation of financial institutions, the insurance and superannuation sectors and the Reserve Bank. We are generally supportive of the amendments, with some qualifications that I will come to shortly. So Labor supports the bill with a few qualifications. The government proposes to make amendments to three acts affecting the operation of financial institutions. The proposed amendment to the Financial Sector (Transfers of Business) Act 1999 seeks to ensure that the ATO is consulted and, hence, that tax implications are taken into account when financial sector businesses are transferred between regulatory bodies. The government proposes to amend the Financial Institutions Supervisory Levies Collection Act 1998 to clarify procedures for the issuance and payment of invoices for industry levies which fund the Australian Prudential Regulation Authority supervisory activities. This amendment is a belated response to Auditor-General criticism of the ad hoc approach to levy collection that has cost taxpayers hundreds of thousands of dollars in lost interest in 2000 and 2001. In the Audit of Financial Statements for Commonwealth Entities for June 2001, an audit qualification was issued to APRA which noted that their accounting procedures `contravene Australian accounting standards'. This change needs to be made by 30 June in order to avoid a further audit qualification. Labor supports these three amendments. However, it is of great concern that APRA, the regulatory body charged with monitoring and supervising the activities of financial institutions, is so prone to criticism by the government's own financial watchdog.The government also proposes amendments to four acts governing the operation of the insurance industry, and one of these amendments is quite minor indeed. The government proposes to amend the Life Insurance Act 1995 to remove a sunset clause due to expire in July this year and so permanently remove life insurance companies' right to appeal prudential decisions to the Administrative Appeals Tribunal. The government notes that the industry supports this amendment. The government proposes to amend the Insurance Acquisitions and Takeovers Act 1991 to lift the 30-day limit on the Treasurer to make decisions on mergers and acquisitions, which the government argues does not provide enough time for a comprehensive investigation to take place. The government also proposes to amend the Insurance Act 1973 to enable APRA to disqualify directors of insurance companies if they are not considered fit and proper persons, and it notes that this is in line with similar legislation applying to the superannuation industry. Labor has long argued that the fit and proper person amendment should be extended to the banking sector. The explanatory memorandum circulated by the Treasurer notes that the proposed amendment to the Insurance Act will `complement proposed changes to the Banking Act 1959'. We therefore seek confirmation as to when this amendment to the Banking Act will be made by the government.The government proposes amendments to two acts governing the superannuation industry. Changes to the Superannuation Industry (Supervision) Act 1993 would enable the ATO to provide information to APRA in relation to breaches, by aligning the secrecy provisions applying to the ATO with those applying to APRA. The other amendment to superannuation legislation, to the superannuation levy imposition act, clarifies the levy obligations of new superannuation entities.Proposed amendments to the Reserve Bank Act 1959 seek to simplify the procedures for appointing RBA board members and other senior officials. The Treasurer proposes to make these appointments directly rather than via the Governor-General. So this is indeed a minor alteration. A further amendment seeks to clarify the termination conditions for RBA officials. Labor is prepared to support measures to facilitate the operation of the Reserve Bank. However, we would be concerned if there was any hint of government interference in Reserve Bank formulation of monetary policy. In recent weeks we have seen repeated examples of ministers seeking to influence Reserve Bank decisions. Labor supports a fully independent monetary authority, the Reserve Bank of Australia.The government also proposes to enable the Reserve Bank to share its head office with a bank or other deposit taking institution. The governor informed the House economics committee, always so well chaired—as we were at our meeting in May—that it had already secured a tenant for one floor of its Martin Place headquarters. Mr Deputy Speaker Hawker, you might remember that I speculated that the media would make good tenants. It would be much easier for all those economic journalists to attend all those nice lunches with the Reserve Bank of Australia in Martin Place.It is, however, somewhat ironic that the Reserve Bank is becoming a landlord when the Commonwealth has forced Commonwealth agencies to become tenants, often with very poor outcomes indeed. Only this week, an Auditor-General's report highlighted the government's appalling mismanagement of its $15 billion defence property portfolio. The report reveals that the government is selling and then leasing back properties when it has no idea of how much they cost to operate. How can the government make sound commercial decisions about these sales worth hundreds of millions of dollars when it does not know what it costs to maintain the buildings? This is a concern that is shared across the parliament. Many members have examples in their own electorates of how property assets are not being properly managed by the government and how in particular the defence property portfolio could be much better managed in the future.The Audit Office also raised this issue in December 2000, but the government has done nothing to fix the problem in the 18 months since. So this is not a new problem. Unfortunately, the government continues to ignore warnings from the Auditor-General, at great cost to the taxpayer—I, for one, am convinced that there are better ways to manage the defence property portfolio. For example, the government failed to respond to the concerns of the Auditor-General about the management of currency risks, raised in May 2000. Defence has since lost $800 million, more than the entire cost of the war on terrorism.The government also proposes amendments to simplify the administration of RBA employee superannuation. Labor is prepared to support those amendments. However, we seek confirmation that superannuation benefits for Reserve Bank staff as they now apply will not be varied without prior consultation with and the agreement of staff covered by those arrangements.The opposition is generally supportive of the amendments contained in this legislation. We note that the government would like the amendments to the Life Insurance Act, removing sunset clauses, and also the APRA Act, to avoid another audit qualification, to pass through the parliament by 30 June. Labor is prepared to support the smooth passage of the bill and to meet this timetable provided we receive two assurances. The first of those is confirmation as to when the fit and proper person amendment will be extended to the Banking Act, and the second is confirmation that no changes will be made to the superannuation benefits of the Reserve Bank's employees without prior consultation with and the agreement of staff covered by those arrangements. I understand that the government will respond to these issues and hopefully make these assurances at the conclusion of the second reading debate, at which time I look forward to hearing from our colleague the Parliamentary Secretary to the Minister for Finance and Administration.13:10:003818Martin, Stephen, MPDr MARTIN8I4CunninghamALP00—I was waiting for the government member that was listed to speak on the Financial Sector Legislation Amendment Bill (No. 1) 2002, but he is not here. I guess that says something about the government's interest in its own legislative program and the bill that is before the House this afternoon. It does give me a bit of an opportunity to speak while my friend and colleague the shadow Assistant Treasurer and shadow minister for housing, urban development processes and reform, and reforming the Labor Party and so on, is in the chamber. Like me, he has an abiding interest—as do you, Mr Deputy Speaker Hawker—in the whole process of financial sector reform. Mr Deputy Speaker, that interest goes back a number of years now, certainly in terms of both you and me having served together for a number of years on a parliamentary committee of this place, particularly when we conducted some inquiries into the Australian financial sector over a decade ago now, and your ongoing work as Chair of the House of Representatives Standing Committee on Economics, Finance and Public Administration, which deals with these matters. As indicated by my friend and colleague the member for Werriwa, this bill deals with a number of issues. Its main provisions go to amendments to the Australian Prudential Regulation Authority Act. The bill also goes to amending the Insurance Acquisition and Takeovers Act, the Life Insurance Act and the Reserve Bank Act. It goes on to talk about the Superannuation Industry (Supervision) Act and also amendments to the Superannuation Supervisory Levy Imposition Act.I found it interesting when looking at this that something seemed to be missing. When we look at the amendments that have been proposed to the Australian Prudential Regulation Authority Act many of us have in the backs of our minds some of the disasters that have occurred in the financial sector very recently in the history of this nation. We know, for example, that almost on a daily basis these days you can go to the financial press—or in the last several months see the front pages of newspapers and lead items on news bulletins at night—only to be confronted with crisis after crisis in the financial sector related to insurance companies, related to medical indemnity insurance or related to public liability insurance. Those issues are ongoing.There are issues arising from the HIH collapse. I accept that a royal commission is under way examining that particular issue. I also understand that arising out of some of the difficulties a number of people are no longer determined as fit and proper to hold director jobs in public companies in Australia, and I acknowledge that one of the amendments contained in this legislation goes to that very issue. But the fact remains that there is still unfinished business. There is unfinished business to do with the question of public liability insurance and there are unfinished issues to do with medical indemnity insurance.As something of a student of recent history in these areas, I have been catching up on a few issues relevant to my present portfolio responsibilities in trade and tourism, and I came across a very recent and very interesting book by Ann Nevile called Policy Choices in a Globalized World. I would recommend it to the member for Werriwa, although he has probably read it before me. Amongst other things, the book talks about conflict and compromise, deregulation of the Japanese financial sector, telecommunications reform in Australia and Japan, taxing solutions and continuing conundrums in Australian federalism. It goes on to talk about aged care policy making in Australia and Japan, about decentralising welfare programs and about the conflict over nursing care insurance in the 1990s.That book also has a chapter on factors motivating financial reform in Australia. The title is `Not just ideology: factors motivating financial reform in Australia'. I read that chapter with interest because of my ongoing interest in these matters. I found it fascinating to reflect on the financial sector reform in the early 1980s under a Liberal government in Australia and what happened in the 1980s and 1990s under Labor governments led by Bob Hawke and Paul Keating. The differences are absolutely stark in the manner in which the economies were freed up. Deregulation was pushed forward by a Labor government. The economic benefits that Australia is experiencing at the moment, as anyone who in their heart of hearts knows anything about economics will tell you, have their root in that deregulation phase of the Australian economy.I also remember having chaired that inquiry in which you, Mr Deputy Speaker Hawker, participated in the early 1990s when we virtually did a five-year report card on the Australian financial sector. We looked at financial sector supervision and we talked mainly about the banking sector; but we also, you might recall, talked about the insurance area and the need for a super regulator to be created. Of course, history shows that the government subsequently moved on that, and APRA is one such body that was formed and given the responsibility of supervising the superannuation area in particular. APRA was established in July 1998, and I commend the present government for having done that, but I must say that there still remain some questions about its effectiveness, as I have said, in the light of some of the issues that remain unresolved in this insurance area, particularly in the last 12 months or so. The brief provided by the Parliamentary Library on this piece of legislation states:The Australian Prudential Regulation Authority (APRA) was established on 1 July 1998 as the prudential regulator of banks and other authorised deposit-taking institutions, life insurance companies (including friendly societies), general insurance companies, superannuation funds and retirement savings accounts. As I read that brief, I could not help but reflect that it all sounded very familiar—it sounded exactly like the recommendations that both you, Mr Deputy Speaker Hawker, and I toyed with when we conducted the inquiry into the financial sector back in 1991. Indeed, we came down on the side of the argument that perhaps a super regulator was necessary. Okay, the government of the day moved to establish appropriate supervisory mechanisms, but at the same time this government took that a step further and created APRA. As I have said, that was an entirely appropriate thing to do. What is proposed here is that a certain amount of money will be retained by APRA to continue its operations. It will be defined in statute, which previously was not the case. Again, coming to the book that I read most latterly, entitled Policy Choices in a Globalized World, and reflecting on outstanding issues in the insurance industry and whether the role of APRA has been appropriate, I could not help but think that perhaps there is a missing element in the legislation and that maybe the government has missed a golden opportunity. At this stage, maybe we should have had, firstly, acceptance at the Commonwealth level that there is a role for the Commonwealth to play in public liability insurance, for example, and maybe a solution instead of the bandaid approach—excuse the pun—that has been taken in respect of medical liability insurance. Maybe we wanted something that would be a little more substantial and that gave people in the broad Australian community who have been touched by these issues some feeling that their government was caring about and listening to those concerns.These are issues which, from my experience in my electorate and from my role as a shadow minister, particularly in tourism, come across my desk almost on a daily basis. I do not whether anybody saw the 60 Minutes program about the effect of public liability insurance on adventure riding in the Snowy Mountains. Nobody who saw that program would underestimate the significance of this issue for the livelihood and the economic wellbeing of this nation—that is, not only the livelihood of individuals, companies and so on but also the fundamental effect that it is having on the economic wellbeing of Australia.Recently in my electorate I conducted a forum on public liability insurance. I was pleased that my colleague the shadow Treasurer, Bob McMullan, was able to come. We talked about a lot of these sorts of issues. Again, people were asking whether, if the government were concerned about this—and people have been saying that it is—if the states are taking a different approach along the way and if perhaps a national approach is necessary, we can get some resolution to this, rather than Howard ministers saying, `No, it's not a federal responsibility; we will shift it to the states.' We have seen the lead taken by Bob Carr in New South Wales to try to remedy some of these issues in terms of tort law and people having to accept greater levels of responsibility if accidents occur, particularly if they are under the influence of alcohol, drugs or whatever. That is fine—and Bob Carr is leading Australia in the approach that is being taken in some areas—but again I could not help but be amazed at some of the issues that came forward at that forum.The shadow Treasurer referred to that forum in a speech on this issue during debate on a matter of public importance the week before last. Like he, I could not believe that a group of about 30 stamp collectors had to have public liability insurance for their stamp collecting activity—for their club—but they do! They have seen their public liability insurance go up by between 60 and 100 per cent. They were just one of the lucky groups. They were a small group of individuals who used to meet on a monthly or fortnightly basis to talk about stamp collecting and who have been dudded over this issue of public liability insurance.Then we had the example of cavers, in Victoria in particular. Sure, caving is a dangerous occupation; we know that. If you have ever seen some of the footage of people getting into very narrow spaces and crevices and going through and finding big stalactites and stalagmites underground, you will know it is a wonderful thing but it is dangerous. The operators who conduct these sorts of things probably find not only that public liability insurance is a must but that they are quite happy to pay it. But the amazing thing coming out of my forum was that the people that turned up said that in this caving club there had been claims made under public liability insurance and in fact three people had been killed. The only thing was that not one of them had been killed in a caving accident; they had all been killed on the road, either coming from or going to weekend activities associated with caving in Victoria. And yet this organisation was being slugged massively with an increase in public liability insurance premiums.The examples from that forum I conducted just went on and on, and the problems were not just in public liability; they were also in medical indemnity. We had an absurd example in Wollongong recently, where the only night service of medicos was going to shut down because it could not get coverage for its medical indemnity insurance. It was a farcical situation, in which this service—where you call the radio doctor if you are really crook at home and want that person to come—was going to disappear. For individuals, people might say, `Just get a relative to stick them in the car and drive them to the local casualty.' Yes, that is an option; that is true. But it was brought home to me by people at Chesalon Nursing Home at Woonona that it was going to impact on the ability of organisations like theirs to get the radio doctors, the after-hours service, to come and visit their patients. Fortunately—and I do say fortunately—that is an issue that has been resolved. But how was it resolved? My understanding is that the after-hours medical service actually had to get coverage through the UK. Wollongong City Council is a similar example. It was looking at how it could cover itself because of the massive hikes in public liability insurance and so on, and my understanding is that it sent the general manager over to the United Kingdom, to London, to try and negotiate better premiums than what was expected to be charged here in Australia from the quotes given by insurance companies. I understand that Professor Fels and the ACCC are looking into this issue, and I appreciate that. I think everybody in this House has had representations from people on the broader issues of insurance in recent times, some of which have come about through the collapse of HIH, where they have argued that APRA perhaps could have been a little more vigilant. We will have to wait and see the outcome of the royal commission on that to make a judgment. But we have had people come and see us about medical insurance, and I think we have all had people come and see us about the question of public liability insurance. My constituents are saying, `Isn't there a way, from a national level, that the national government can take a stronger view and perhaps take a stronger lead in coordinating a lot of this information and providing a solution to the problem?' I have to have some sympathy with this view. We have become very much a litigious society in Australia and it is regrettable. In years gone by, if you tried to sit in a chair, missed it, fell down and injured yourself, you picked yourself up—if you could—got yourself repaired and that was it. Life went on. Not any more. We turn around and find the nearest person we can sue and the nearest solicitor who is going to stand up for us. Then that solicitor ends up taking about 60 per cent of the proceeds anyway. What sort of a society has that generated in recent times? As I said—and I return specifically to the legislation here—the missing element that I thought could have been included in this Financial Sector Legislation Amendment Bill (No. 1) 2002 goes to those concerns in the broad community of Australia at the present moment about insurance. It is terrific to say that amendments are going to be brought in here so that APRA is going to be guaranteed a certain amount of money from the Treasury, based on the levies, fees, charges and so on that are applied in terms of its work. That is great and that gives APRA operating capital and enables it to do the work it has to do. It is terrific that there are amendments being made in terms of general insurance as well, where APRA is going to be able to disqualify a person from being a director and senior manager of a general insurer if it is satisfied that that person is not a fit and proper person to hold such office. Again, this is a terrific idea, and some of the people who have been running companies in this country over a long period of time deserve to be brought to account. They are accountable to the people they represent through various companies and they should be brought to account if those companies conduct themselves in a misleading or an illegal way—and in some way they should be made to make restitution to the Australian people. Very high-profile people have been caught up in this over the years, including, recently, Rodney Adler in Sydney, who was part of FAI and so on. If it has been proven on the evidence that people like that are not fit and proper to hold positions, then, fine, get rid of them, disqualify them and fine them substantially, as has been the case now. I think this amendment is appropriate. It is similar when we look at some of the minor amendments to life insurance and—as my colleague the member for Werriwa talked about—amendments to the Reserve Bank Act, so that Treasury representatives on the RBA board can be determined more appropriately, or that leasing out office space can be controlled and so on. They are all worth while, but they are only minor issues in the broad issue about the insurance industry in this country at the present time. I just wonder whether a golden opportunity has been missed by the government on this occasion with this legislation. We seem to be dealing with minor matters in bills, when out there in the broad community there are still incredible worries about what is going to happen at the end of the year when this latest extension to medical insurance, the guarantee from the government, comes to an end. What is going to happen then? What is going to happen with public liability insurance if adventure tourist operators or stamp collectors suddenly find they can no longer have clubs, or if the people that run the Man from Snowy River horsing events have to close down and adventure tourism like that is lost to Australia? That is the Australian character.I had hoped that this would be a terrific opportunity, because if there is one issue that continues to dominate people's everyday lives in Australia, it is the financial sector. Reforms of the financial sector do not stop simply because governments change and particular matters are dealt with in public inquiries from time to time and governments make regulations and changes based on that. It is an ongoing process where you must continue to monitor and watch what takes place in the Australian economy. The integral part of that economy—the financial sector—must always be watched. This is, unfortunately, a golden opportunity the government has missed to try and rectify some of those issues. I would hope that, in the not too distant future, the opportunity to fix those problems is taken. (Time expired)13:30:003822Cadman, Alan, MPMr CADMANSD4MitchellLP10— The Financial Sector Legislation Amendment Bill (No. 1) 2002 before the House today comprises a whole range of minor amendments to a range of legislation, including the Financial Institutions Super-visory Levies Collection Act, the Financial Sector (Transfers of Business) Act, the General Insurance Reform Act, the Insurance Acquisitions and Takeovers Act, the Life Insurance Act, the Reserve Bank Act, the Superannuation Industry (Super-vision) Act and the Superannuation Super-visory Levy Imposition Act. This is broad ranging and significant legislation, some of which will have a significant impact on Australians. Some of it deals with issues that are in the public arena, without coming to grips with the actual cause of some of the problems in the insurance industry.The government is proceeding in a measured and careful way to resolve the insurance industry problems that have emerged over the last few months. There is no doubt that the impact of September 11 is significant as far as world insurance is concerned; nobody appreciated that companies like QBE would be seriously affected by insurance holdings offshore. Nobody would have predicted that such an occurrence, linked with the failure of HIH, could have such a widespread impact on things such as the Country Women's Association and pony clubs. There is hardly a community group that has not been affected by massive increases in its premiums due to these factors.I want to go back over the last 10 years and look at what the insurance industry have been doing. A careful track through their figures indicates that they have taken a short-term, year-on-year, profit approach. The long-term projections by more prudent insurance companies, which are now available to us, indicate that the high-flyers—the so-called golden companies—of the insurance industry made calculations without adequate reserves and without an assessment of what their payouts would lead to. They made assessments based on cutting premiums and on writing more business purely on the basis of cash flow rather than what they might ultimately have to account for. If one looks at the year-to-year accounts over the last 10 years, one can see that over the last two years insurance companies have faced a squeeze because they have not had enough income to cover their payouts year by year. However, an actuarial study based on a longer term view, and which is available to members and to the Assistant Treasurer, has been undertaken by a number of companies. It indicates that this trend was predictable as far back as 1997 and 1998 and that the ratio of long-term costs for insurance companies was clearly demonstrable. Any wise manager would have seen the escalating claims, the escalating payouts and the declining margins available to insurance companies three to four years ago. But, during that time, companies such as HIH continued to write unprofitable insurance and continued to buy unprofitable companies. They had what I regard as a very cavalier approach to the strong, deep and abiding trust placed in insurance companies by the public. Cavalier conduct is not what the Australian community expects from an insurance company.This is equivalent to the conduct of some of the banking fraternity in the early 1990s, when they seemed to think that any bright scheme dreamed up in Western Australia or anywhere else was worth backing with lots of money. The crash came, and those lost funds had to be recovered in many instances from small business corporations. The public now have a growing disenchantment with the way insurance companies operate, and rightly so. They have seen that the willingness to write unprofitable insurance translated into crashes and failures. There was a sudden realisation that there could have been increased premiums over a longer period of time to cover the real cost of insurance. But nobody took those actions and suddenly the public—the small individual—has been lobbed with huge claims and huge premiums. Of course, that is not the whole story; the litigious nature of our society—which, I am told, is second only to the Californian community—is also to blame. When one compares the figures from the various states, New South Wales is the state where the largest claims are paid out. Does that mean that people take more risks or do more damage to themselves in New South Wales than elsewhere? No, it does not. It means that the judges that make these decisions have a far different attitude from those in Tasmania, where similar claims will earn a fraction of the damages claim.In New South Wales I think there is an entrepreneurial attitude in the community as well as careless administration at the state level. A cavalier approach by some members of the judiciary has created a situation whereby extraordinary claims have been met on the basis of sympathy rather than fact, and there is an attitude that wealthy insurance companies can afford to pay. Predictably, the figures were there three to four years ago.I guess what I really want to know in this situation is: where was the Insurance and Superannuation Commission and where was APRA in this process? I understand that the Commissioner for Insurance and Superannuation was notified in 1991 of the difficulties that where being faced by HIH, and I believe that there was correspondence at that time between the commission, the commissioner and the insurance company. The agreed process, over a period of a few months in 1991, was that HIH would trade their way out of it. Ten years later, they are still trading their way out of it by buying companies like FAI—some supervision, some control, some management! I know that the royal commission will turn up these factors, but I cannot believe that Insurance and Superannuation Commission personnel were all dumped with the formation of APRA, that none of them got a job in the new organisation and that none of them carried forward any knowledge or understanding of the insurance industry, their responsibilities or the responsibilities of the role of the new supervisory body.It is a matter of real concern because the fact is that we will shortly see legislation which will restrict the activity of general insurance companies. It will require certain funding and a certain holding of funds. Some of the smaller companies have been very successful companies; they have operated without threat or problem. But what we will see in the future as one way of fixing this problem is not a better commitment to better supervision and not a willingness to understand why there was a failure of the supervisory body 11 years ago to put in place a plan to have HIH take control of its circumstances and then to watch over it diligently to see that that actually occurred. That is not the plan. The plan is to knock out some of the smaller operators to see whether that fixes the problem. The only shortfall I see with that approach is that HIH was the largest company of its type operating in Australia. There is nothing in this process that would seek to deal with the problems exposed by HIH with regard to supervisory roles. Instead, there is a wish to knock out some of the smaller companies because they may be at risk. I know that the government is working through these problems.I want to put on the record my concern about the lack of supervision and the lack of knowledge being carried forward from the Insurance and Superannuation Commission into APRA and the failure of APRA to continue a plan of supervision of HIH—a plan that was known about and should have been implemented. I make another passing comment about APRA when I note that the Auditor-General was not happy with the way in which they kept their accounts and he gave a qualified audit opinion. That is hardly the sort of thing that you would expect to apply to a regulator of finance in Australia. A qualified audit opinion of APRA—who would believe it? I do not think they are at all impressed. A great deal more needs to be done to demonstrate to the community at large that this organisation is worthy of holding a position of supervision of financial institutions. The Australian National Audit Office stated in its report in 2001, when it investigated APRA, that the policy adopted also represents a departure from Australian accounting standards. Can you imagine that—the organisation charged with upholding accounting standards ignoring them as part of its processing? The Audit Office said:The policy adopted also represents a departure from Australian Accounting Standard AAS15-Revenue, which requires that revenues be recognised when, and only when, the entity has gained control of the revenue or the right to receive the revenue.I hope, in the wash-up of the royal commission, that some of these things are noted and dealt with. In the view of ANAO, the effect of APRA's reporting approach was that the net off-rating deficit was understated by $799,000—that is, three-quarters of a million dollars out, simply by not following an Australian accounting standard. No doubt since that time there have been many explanations. I do not know where the opposition have been while these things have been disclosed, but they certainly have not targeted a need for better strength in a supervisory role.I want to deal briefly now with some of the problems created in the insurance industry with the changes that have occurred. First of all, I want to look at the medical insurance fund, the chairman of which said, I believe in the month of March, that all doctors should be very happy with their self-managed fund and they should keep backing it. Then, a month later, they called in a liquidator. I do not believe that that is very responsible management of that fund, which is not supervised by APRA—I cannot blame them for this problem—and the chairman of such an organisation was, I believe, either misled or is being misleading and should, in fact, have been able to inform his members, some of whom are the most hardworking and brilliant Australians, who are responsible for their fellow citizens' health. It is not possible for surgeons, neurosurgeons and obstetricians—people charged with serious and long-term responsibility for health—to continue to operate. So the end of the year, when the government's program starts to peter out, is an important deadline for us to examine the way in which medical insurance will be established. I do not believe people need have any worries at this point. Most of the members of the medical fraternity with whom I have discussed this seem content at last with what the government has done. The AMA was not particularly helpful because in every instance that something was proposed there appeared—reading between the lines—a private agreement between the head of the AMA and the government, and then a press conference immediately after that denied some of the things that appeared to be settled. Either the representation is out of touch with the requirements of the medical fraternity or it is prepared to negotiate away their requirements but disclaim that in a public statement. It will be interesting to see that the government can move through and satisfy the highly skilled specialists who need to have a particularly stringent coverage.One has only to speculate briefly to realise that obstetricians attending a birth are liable for negligence claims against them for as long as 26 or 27 years following that birth, during which time it is possible for a person to sue the obstetrician for any matter they feel may relate to a difficulty caused by that person at the birth of a child. That is a very long bow, but judges have listened to those arguments. The same thing applies to neurosurgeons, where an operation performed of a delicate type on nerves or brain can be claimed against in the indefinite future. This has to be limited. We cannot forever hold a person responsible for their actions when their intention—their whole commitment—is one of remedy and healing. We are only looking at what is inadvertent or negligent, and that is the way the insurance needs to be drafted and drawn.I want to talk about public liability and the role of sedentary organisations—organisations that meet on a monthly basis, discuss business, write letters and try to get improvements in our community. They have a very difficult job in confronting their budget in the coming year when they find how much their insurance has increased. Their public liability claims are not great because they do not get into dangerous activities. From an insurance point of view, a Country Women's Association street store is hardly equivalent to a pony club or a sporting club activity. But both are equally significant from the community's perspective and need support and need to be able to continue. All of these groups fill most important roles in our society. To say that they should cease meeting or cease continuing simply because of the cost of insurance would be a criminal and dreadful thing to do. It would irrevocably change the nature of the Australian community.We have just celebrated the Year of the Volunteer. Many of those volunteers who received awards during that year received them for jobs they had done in a voluntary group of a small and local nature. They are the ones who are going to be hit, not the tourist operators talked about by the opposition. I do not know when the opposition are going to get it into their heads that real Aussies do not go on wild adventure holidays. Real Aussies belong to their local groups, in which they perform services day by day, year by year, to their community. These are the ones that are of greatest concern in continuing public liability insurance.I refer to the self-fulfilling nature of the requirement to insure at a higher figure because claims are high. I remember when we needed to insure for a public liability of $1 million. Within a couple of years we needed to insure for $5 million. Now the figure is $10 million. A community organisation insures for public liability for $10 million. This needs to stop. Pony clubs, sporting groups, the Country Women's Association, P&C associations—all of those groups—need to have the assurance that they are safe to continue their activities and safe to continue a voluntary effort in the community. They need an assurance that they are safe to continue to service the community and receive a sense of fulfilment and sense of purpose by doing so. I am looking forward to the resolution of these problems. The government is moving, as are state governments. I hope that they are sensible in formulating the outcome. (Time expired)13:50:003825Tanner, Lindsay, MPMr TANNERYU5MelbourneALP00—The Financial Sector Legislation Amendment Bill (No. 1) 2002 deals with a range of regulatory changes to the arrangements primarily governing the regulation of corporations, particularly in the financial sector. I will address them very briefly in turn, because they are broadly uncontroversial and are supported by the opposition, and then make some broader comments about the government's approach to regulation in the financial sector and, more broadly, corporate regulation in this country.The amendments deal, in sequence, with the Financial Sector (Transfers of Business) Act and provide for the involvement of the Australian Taxation Office when businesses switch from coverage of one regulatory authority to another and the Australian Prudential Regulation Authority Act and a need to amend that act because APRA has been in breach of the Australian accounting standards, which in itself is a signal of some of the deficiencies and problems that we have had with respect to regulation of the corporate sector in recent times under the Howard government.The third set of amendments go to a number of pieces of legislation governing the insurance industry and relate to the right to appeal prudential decisions made by the regulator to the Administrative Appeals Tribunal, the 30-day limit which currently exists with respect to the Treasurer's powers to approve or not approve managers and acquisitions in the industry, and the powers of APRA to disqualify persons on the basis of their not being a fit and proper person.The fourth set of amendments relate to the superannuation sector, and particularly the Superannuation Industry (Supervision) Act, and provide new provisions with respect to the tax office giving certain information to APRA and also new provisions with respect to the levy obligations of new superannuation entities. Finally, there is a range of amendments associated with the Reserve Bank of Australia and in particular the appointments to the board of the Reserve Bank, which are now to be done directly by the Treasurer rather than indirectly through the Governor-General as previously. They also simplify arrangements with respect to superannuation for Reserve Bank employees and allow the Reserve Bank to become a landlord.I would like to make a couple of remarks on this final amendment. It is indeed ironic that the government is proposing to legislate to empower the Reserve Bank to become a landlord and to have tenants in its building in the context of the broader approach that the government has taken to government organisations and buildings. Under this approach, it has been selling buildings—particularly Defence buildings, but also the headquarters of the Department of Foreign Affairs and Trade—on the open market and then leasing them back in circumstances in which the Auditor-General has found, in a report released about 18 months ago, that this will be a net cost in real terms to the Commonwealth within, in some cases, a period of as little as eight years. In other words, what in effect is happening is that the government is turning itself from a building owner into a building renter. It is selling the building that it currently owns and then renting it back. The nature of the transaction is such that, when you put together the two possible scenarios, the Commonwealth goes into the red on the transaction within as little as eight years. This has all been done to prop up the budget. It has all been done to get the proceeds of the sales of these buildings to prop up the budget, which has gone into deficit in recent times. The net outcome for taxpayers will be negative in the longer term. It is ironic that, in this legislation, the government is proposing to empower the Reserve Bank, a federal government body, to become a landlord at the same time as the government is busily selling all of these other buildings and putting itself in the position of a tenant in highly unfavourable financial circumstances.It is also worth noting as a footnote that similar problems have arisen with respect to the Department of Finance and Administration's handling of foreign exchange transactions, and particularly with the Department of Defence, where it has failed to hedge the enormous foreign exchange risk associated with Department of Defence contracts. The department of finance suffered from the same problem, and in a report in May 2000 the Auditor-General found that literally billions of dollars over a period of years had been lost as a result of the failure of the Commonwealth to take protective action to hedge against this foreign exchange risk.What this all points to is that the Howard government are at best equivocal about the process of regulating the corporate sector, about financial management, about ensuring that consumers are protected and about ensuring that we have fully functioning, efficient markets where companies compete on a genuine basis and where consumers have genuine protection against being ripped off. They are not prepared, in many cases, to support the necessary regulation, powers and resources for the police forces that are involved in enforcing these regulations, be it ASIC, APRA or the ACCC. All of these organisations play a fundamental role in our society in ensuring that we do not get corporate misbehaviour, that ordinary consumers and ordinary citizens are treated fairly and properly by business and that we do not get fraud, corruption and misuse of taxpayers' and consumers' money by big business.The latest example of this trend, which I will refer to briefly in the remaining time available, is the concerted campaign by the big business lobby and the business establishment to water down section 50 of the Trade Practices Act which governs mergers and acquisitions and sets a test which is designed to ensure that we do not have private monopolies emerge in Australia. It is designed to ensure that we have protection for consumers, that there is genuine competition and that we do not have single companies able to totally dominate a market for a particular product. The big business sector has been campaigning vigorously against this provision, demanding that it be watered down, and it has been campaigning vigorously against the ACCC and the chairman of the ACCC, Professor Fels. A process of relentless undermining and relentless sniping, aided by a number of business journalists, has been pursued, and the government appears to be listening. It appears to be taking some notice of this, because it has established an inquiry into the Trade Practices Act provisions and the ACCC which quite clearly, when you read the terms of reference of the inquiry, is all about nobbling the ACCC. The business establishment luminaries who have launched this attack are all trying to argue that the ACCC is out of control, that it abuses its powers, that it has excessive powers and that this is making it harder and harder for Australian businesses to do business, to grow, to expand overseas and, ultimately, to prosper for the benefit of the economy. They have argued that Australian companies need to merge to form bigger-scale companies in order to succeed on the global scale and that the ACCC is engaged in an outrageous antibusiness crusade and is using trial by media to smear honest companies.As is often the case with such nakedly self-interested campaigns, the evidence simply does not substantiate the claims. Australia's domestic market is so small globally that, in most cases, a merged national champion which had total dominance in our domestic market would still be a relatively small player on the global market. Any efficiency gains which flowed from allowing competitors to merge and become a dominant company in Australia would, in the long run, be eroded and overtaken by the loss to efficiency and to consumers by the reduction in competition which would occur. In many sectors, the threat of serious competition from new foreign competitors is often more hypothetical than real. If we allow the insidious influence of monopoly to spread in our economy, the long-term consequences for competition, for markets, for consumers and for economic efficiency will be dire. Recent claims that the ACCC have used trial by media to vilify poor innocent companies—like oil companies—really have no substance. It is claimed that a newspaper was advised in advance of a raid that was conducted on oil companies by the ACCC.9V5Pyne, Chris, MPMr Pyne—Nonsense!YU5Tanner, Lindsay, MPMr TANNER—Yes, it was; but why was it advised in advance? Because the newspaper concerned had been contacted by the whistleblower who had advised the ACCC of the situation that they needed to investigate, and the ACCC, in order to get agreement from the newspaper that it would not prematurely disclose these situations, had to agree that they would advise the newspaper of when the raids would take place—the sort of arrangements that, in any kind of policing operation, are sometimes necessary to ensure that the job can be done. The companies concerned have had the opportunity to launch legal action against the seizure of the documents, and they have not chosen to do so. In spite of the statements that some business journalists have been running, this issue is not over. It will take months before any proper judgment is made on the documentation that has been seized as to whether or not any sort of case should proceed. The publicity that surrounds these cases is always hyperinflated by members of the business establishment, who are always searching for a new alibi to justify their poor performance, and by many business journalists, who seem to think that the only indicator of economic wellbeing is share prices and that competition is a useful theoretical concept to be abandoned whenever it becomes inconvenient. I would urge the government not to listen to the voices of the big business establishment, to stand up for consumers, to stand up for proper functioning markets and efficiency and to protect the ACCC and let it do its job.10000SPEAKER, TheThe SPEAKER—Order! It being 2 p.m., the debate is interrupted in accordance with standing order 101A. The debate may be resumed at a later hour.Questions Without Notice3827382714:00:003827Rudd, Kevin, MPMr RUDD83TGriffithALP00—My question is directed to the Prime Minister. Can the Prime Minister confirm reports that the coalition party room meeting debate on the International Criminal Court yesterday included the member for Makin expressing her disgust at the foreign minister, the member for Hinkler alleging the inferiority of African and Asian judges, the member for Hindmarsh calling the member for Hinkler a racist, the member for Hume threatening to cross the floor and a 37 to 35 split for and against the ICC?DK6Hockey, Joe, MPMr Hockey—How is that relevant?10000SPEAKER, TheThe SPEAKER—There is no facility that allows party room debates to be commented on during question time. The member for Griffith has the opportunity to rephrase his question. I am merely indicating to him that there is no facility that allows the party room debates to be commented on in question time.83TMr RUDD—Prime Minister, isn't the prosecution of war criminals like Pol Pot too important for Australia's national interest and the international interest to be made the plaything of the rabble that has now become the coalition party room?3828Howard, John, MPMr HOWARDZD4BennelongLPPrime Minister10—I can certainly confirm at least one thing, and that is that the member for Griffith can read the newspapers, because those reports all appeared there. Let me say this: we did have a very vigorous debate yesterday, and I am proud of that. I will tell you why I am proud of it: I can still remember a car telephone call—not the one that some people immediately think of— YU5Tanner, Lindsay, MP10000SPEAKER, TheThe SPEAKER—The member for Melbourne!ZD4Mr HOWARD—It was in Melbourne. It was in December of 1995. I was rung by the then foreign minister, Gareth Evans. In those breathless, earnest and grave tones for which he was famous, the then foreign minister said to me, `Mate, I've got great news. We have negotiated an agreement with Indonesia and nobody knows about it.' He said, `I want you to keep this very confidential.'DT4Crean, Simon, MPMr Crean—This is your party room speak.ZD4Mr HOWARD—No.10000SPEAKER, TheThe SPEAKER—Leader of the Opposition! The Prime Minister has the call.Opposition members interjecting—10000SPEAKER, TheThe SPEAKER—The member for Wills! The member for Braddon! The member for McMillan! The Prime Minister has the call.ZD4Mr HOWARD—They have all had their fun, Mr Speaker. When it comes to entering into international obligations, the difference between us and those who sit opposite is that we involve the Australian people and they never did. Let me say that this government will never enter into international obligations without fully involving the Australian people in that process. Let me also make this very clear: we are not going to enter into any international obligations that compromise the sovereignty of this country. That is a fundamental given of any approach that we have to these matters.I listened very carefully to what was a very well-informed and vigorous debate. I depart from my normal practice in relation to all but one of the allegations about it that were made. Let me make it very plain that everybody who participated in that debate participated out of great goodwill, not only to the national interest but also to the interests of people of other countries. Any suggestion that any prejudice or intolerance was displayed during that debate is absolutely wrong. I can assure the Leader of the Opposition that this government will take its decisions in accordance with the processes of the government parties. That involves consideration by the party room and then consideration by the cabinet. I can assure the Leader of the Opposition and I can assure the Australian people that the decision that will come from the cabinet as a result of that consideration will be one that will serve the national interest and certainly not compromise Australian sovereignty.382814:05:003828Jull, David, MPMr JULLMH4FaddenLP10—My question is directed to the Minister for Foreign Affairs. Following the suicide bombing in Israel yesterday, would the minister provide an update of Australia's approach to the ongoing conflict in the Middle East?3828Downer, Alexander, MPMr DOWNER4G4MayoLPMinister for Foreign Affairs10—I thank the member for Fadden for his question. I do appreciate the serious and considered approach he takes to foreign policy issues in general and the situation in the Middle East in particular. The government condemns the suicide bombing in Israel yesterday that killed at least 19 Israelis. I am told there are now some 21 Israelis who remain in hospital. I offer Australia's condolences to the victims of this latest act of terror. With depressing regularity, such acts take place when fresh peace initiatives just start to get under way. That of course is profoundly depressing.The government has made this point on several occasions before, but the Palestinian Authority must take stronger action against terrorism. Chairman Arafat and other members of the Palestinian Authority must act decisively to stop these acts of terrorism. I also take the opportunity to urge Israel's regional neighbours to bring pressure to bear to ensure an end to these appalling acts of murder—these attacks on innocent civilians, including, in this case, children—and to do what they can to encourage a resumption of negotiations. During the course of last two days I have been with Iran's Foreign Minister, Dr Kharrazi, and I have taken advantage of my meetings with him to make these points. I have spoken in similar terms to representatives of Israel's Arab neighbours.We support the United States leadership in its efforts to secure an end to violence, to address the humanitarian and development needs of the Palestinian people and to advance a political process. We have welcomed—and I welcome again—the Saudi-initiated Arab peace proposal. We, as Australians, stand ready to consider practical ways in which we can support those more centrally involved in efforts to secure peace. Despite these latest and very brutal attacks, we must hold to the vision—which was affirmed by the United Nation's Security Council in March—of a region where two states, Israel and Palestine, live side by side within secure and recognised borders. But an eventual peace depends ultimately on the efforts of the Palestinians and the Israelis. It has to be their peace; they have to own it.The government remains concerned about the humanitarian situation in the Palestinian territories. Australia has committed $1 million in humanitarian assistance to help relieve the suffering of those affected by the recent violence. Total Australian aid flows to the Palestinian territories and Palestinian refugees in surrounding countries is estimated to be about $10½ million this financial year.14:09:003829Crean, Simon, MPMr CREANDT4HothamALPLeader of the Opposition00—Mr Speaker, I seek your indulgence.10000SPEAKER, TheThe SPEAKER—The Leader of the Opposition is granted indulgence.DT4Crean, Simon, MPMr CREAN—On behalf of the opposition, I join with the foreign minister in expressing our shock at the latest incident. We join with him in extending our condolences to the Israeli people on another group of victims of the violence in the Middle East and join with him as well in not only condemning the terrorist activities but urging the parties to get back to sensible discussions towards a peaceful outcome in the Middle East. 382914:10:003829Crean, Simon, MPMr CREANDT4HothamALP00—My question is to the Prime Minister. I ask the Prime Minister if he recalls repeating yesterday his election commitment not to cut anyone's benefit. Prime Minister, isn't your proposal to force people off the disability support pension and on to Newstart, cutting the benefits of 200,000 Australians with disabilities by up to $52 a fortnight? How do you explain to the many Australians here in the gallery today representing disability groups that this is not a cut in benefits and, as a consequence, a broken promise by you?3829Howard, John, MPMr HOWARDZD4BennelongLPPrime Minister10—I do not share that interpretation at all. I made it clear before the budget that the government for some time had been looking at the eligibility criteria. There was no contemplation at all of a reduction of the benefits to which people were eligible. That is the difference.382914:11:003829Somlyay, Alex, MPMr SOMLYAYZT4FairfaxLP10—My question is addressed to the Minister for Immigration and Multicultural and Indigenous Affairs. Would the minister inform the House of the government's position in relation to the ongoing protection of Australia's borders?3829Ruddock, Philip, MPMr RUDDOCK0J4BerowraLPMinister for Immigration and Multicultural and Indigenous Affairs and Minister Assisting the Prime Minister for Reconciliation10—I thank the honourable member for Fairfax for his question and the opportunity to elaborate briefly on these matters. Can I first say that I think on Tuesday I mentioned that there was an important memorandum of understanding signed between Australia and Indonesia and that that was done in Indonesia. In fact, the memorandum was signed in Perth.The government, of course, takes these matters very seriously. There is information of a credible threat to Australia's northern borders as people smugglers move their trade in an easterly direction. The decision to excise Christmas Island, Ashmore and Cartier islands, and the Cocos islands, of course, has, along with a range of other initiatives which I enumerated earlier, been successful in deterring boats from seeking to access Australia.The government does believe that the additional excisions that we have proposed and implemented by way of regulation will provide an additional deterrent and are an important part of the broader strategy of prevention, interdiction and deterrence. It is regrettable, of course, that the Labor Party have once again shown that they are unwilling to embark on fully implementing all of those measures, which we are advised will enable us to best protect our borders. Yesterday, the ALP in the Senate complained that they did not have a chance to debate the proposed regulations and wanted us to bring forward the tabling of those matters so that there could be, presumably, an earlier attempt to disallow them and to ensure that they are in place for as little time as possible in order to provide the protection that is important. That is the reason they want to do it.83LGillard, Julia, MPMs Gillard—We just wanted them tabled.0J4Mr RUDDOCK—It is not a question of debate—83LGillard, Julia, MP10000SPEAKER, TheThe SPEAKER—The member for Lalor!0J4Mr RUDDOCK—it is a question of bringing it forward so you can cut it off as quickly as possible.83LGillard, Julia, MP10000SPEAKER, TheThe SPEAKER—The member for Lalor is defying the chair!0J4Mr RUDDOCK—That is clearly what the Labor Party have in mind. They are hanging their colours out there so that everybody knows they are not serious about border protection. But we intend to give the opposition an opportunity to make it clear that they are sabotaging the border protection measures. We will table the regulations in the Senate this afternoon, giving the opposition leader an opportunity to reconsider his position, and we will see whether he is prepared to support these sensible, logically developed and important regulations. But I suspect from the nature of that response that he will remain captive of those who are seeking to get the Labor Party to go soft on border protection.DT4Crean, Simon, MP0J4Mr RUDDOCK—I want to give the Leader of the Opposition notice that the government will be introducing legislation into this House tomorrow to provide protection by way of amendment to the Migration Act, and you will have an opportunity to deal with that legislation as well as all of the implications over the longer term that that will involve. I think it is also very important to know that, in relation to these matters, the government is well supported by those who have a view about the islands to our north. I particularly want to table for the benefit of members a press release from the Torres Strait Regional Authority in which that authority welcome news that we would extend the definition of excised offshore places to include the islands of the Torres Strait. Mr Terry Waia said:The change to the act will not affect current traditional activities but will give greater protection against illegal immigrants infiltrating the Australian borders through the Torres Strait. The inclusion of the Torres Strait in the amended act as an excised offshore place removes the ability of unauthorised arrivals into the Torres Strait from being able to access an Australian visa—The authority recount their recent experience with a growing number of illegal migrants using the Torres Strait as an entry point and it is good to see that the government is taking positive action to address this problem.383014:16:003830Plibersek, Tanya, MPMs PLIBERSEK83MSydneyALP00—My question is to the Minister representing the Minister for Family and Community Services. Is the minister aware that represented in the gallery today are the following groups supporting people with disabilities: Wagga Wagga Community Access Services, Community Connections, Chatswood Supported Living Services, DSP Australia, the Foresight Foundation and Windgap. Minister, can you give an assurance to these important groups that they will not have to cut services and staff in 12 days time because your government will not meet its responsibilities under the New South Wales social and community services award? 3831Howard, John, MPMr HOWARDZD4BennelongLPPrime Minister10—The honourable member asked a question about a serious subject. It was almost identical to the question asked yesterday by the member for Calare. I refer the member for Sydney to the answer that I gave to the member for Calare yesterday. But, as people in the gallery who have a very legitimate interest in this issue were not present yesterday, let me repeat what I said to the member for Calare yesterday. I have had drawn to my attention the concerns of a number of groups in relation to this quite difficult issue. I have asked for the preparation of a paper listing a series of options for the government to consider relating to ensuring that the Commonwealth's responsibilities in this area are met. I want to give an assurance that I do not intend to see important services for the disabled and the disadvantaged in New South Wales or indeed elsewhere in the Commonwealth affected. It will take a while to work through the response, but I want to assure those representatives that we are concerned. We do recognise that many of the people employed in this sector are paid quite low wages and that a proper and sympathetic response from governments at both levels is needed.383114:19:003831Prosser, Geoff, MPMr PROSSERRI4ForrestLP10—My question is addressed to the Treasurer. Would the Treasurer advise the House how responsible budget policy underpins the provision of essential services to the Australian community? Would the Treasurer inform the House of threats to responsible economic management?3831Costello, Peter, MPMr COSTELLOCT4HigginsLPTreasurer10—I thank the honourable member for his question. I can tell him that in order to underpin necessary social services it is necessary to have the financial arrangements which will sustain them. There could be no other area of policy where that is more required than in relation to the Pharmaceutical Benefits Scheme.84HZahra, Christian, MP10000SPEAKER, TheThe SPEAKER—The member for McMillan!CT4Mr COSTELLO—When the Labor Party introduced the copayment for pensioners, which was in 1990—and I think the member for McMillan was alive then, Mr Speaker—Opposition members interjecting—CT4Mr COSTELLO—we were in opposition and we supported Brian Howe when he introduced a $2.50 copayment. It was done in order to put the Pharmaceutical Benefits Scheme on a sustainable basis. After it was introduced, the amount of the scheme which was recovered through copayment was 21.6 per cent, and that is why Brian Howe and then Treasurer Paul Keating introduced it.84HZahra, Christian, MP10000SPEAKER, TheThe SPEAKER—The member for McMillan is warned!CT4Mr COSTELLO—Today the copayment is 15.7 per cent of the Pharmaceutical Benefits Scheme. If the government's measures go through, it would return to 19 per cent; that is, less than it was when Brian Howe introduced the copayment but not at the 15.7 per cent of cost recovery that it now is. Some in the media have been amused that we would quote a member of the Socialist Left, Brian Howe, in support of a proper financial basis for the Pharmaceutical Benefits Scheme. This is not because the coalition government supports the Socialist Left over the divided Labor Unity faction of the Labor Party; it is just to illustrate that even the most irresponsible member of the Socialist Left is more responsible than the current leader of the Labor opposition. That is the proposition. There is no greater political opportunist in Australia today than the member for Hotham, who is opposing these measures which are to base the Pharmaceutical Benefits Scheme—2V5Swan, Wayne, MPMr Swan—Mr Speaker, I rise on a point of order. It concerns relevance, under standing order 145. The question asked of the Treasurer referred to current budgetary policy. It did not refer to any alternative views. The Treasurer is not addressing current budgetary policy, which is what the question was about, and his answer is irrelevant.10000SPEAKER, TheThe SPEAKER—The Manager of Opposition Business is aware that I do my best to record the question as asked. The Treasurer was asked about budget policy and any threats to budget policy; for that reason I have not interrupted what he was saying.CT4Mr COSTELLO—The greatest threat to responsible economic policy in Australia today is the member for Hotham, the Leader of the Opposition, Australia's greatest political opportunist.2V5Swan, Wayne, MPMr Swan—Further to that point of order, Mr Speaker: you said that the Treasurer was asked about threats to budgetary policy. How is Brian Howe a threat to budgetary policy?10000SPEAKER, TheThe SPEAKER—The Treasurer is in order.CT4Mr COSTELLO—My proposition was that Brian Howe was not a threat to economic or budget policy. It is the Leader of the Opposition who is a threat to budget policy—that is the whole proposition. Australia's greatest political opportunist, who was in the parliament in 1990 and, along with the Liberal Party and the National Party voted for the $2.50 copayment, now says that a proposal to return cost recovery, not to what it was then but to 19 per cent less than it was then, is somehow beyond the pale.Brian Howe and the member for Hotham recognised that in 1990. In the budget speech of 1990 the then Labor Treasurer, in support of the $2.50 copayment, said:... scientific advances have resulted in a massive increase in the number and variety of health care drugs available.It took almost 40 years—from 1948 to 1985—for the costs of that scheme to grow to half a billion dollars.It took only another 4 years for the costs to grow by another half a billion dollars. And in another three years those costs would have reached over $2 billion were we not to have acted now.That is what he said in 1990. Today the scheme runs at above $4 billion. In 1990, when the copayment was first introduced and the non-concessional card increase was 36 per cent, the Labor Treasurer, Mr P.J. Keating, said:The alternatives are stark: reconstruct the scheme so that it remains fair for everyone, or lose the scheme altogether, so that access to complete health care would only be available to the wealthy.That is what the Labor Party said: reconstruct the scheme with a copayment and a non-concessional copayment recovering 21 per cent of the scheme so that it remains fair for everyone, or lose the scheme altogether so that access to complete health care would only be available to the wealthy. That is what Mr Keating said in 1990, that is what the member for Hotham voted for in 1990 and that is what Brian Howe said in 1990.Today we have Australia's greatest political opportunist opposing the measures to reconstruct the scheme, not because he cares about the sick or those who need medicines; he cares only about his failing leadership, which needs a stand to try to prop it up. That is what this is all about. Nothing could illustrate more to the Australian public that this is an opposition that no longer hold any prospect of being in government. If the opposition genuinely thought they would one day be in government, knowing that this scheme has to be properly financially based, they would be voting for this just as the Liberal Party voted for it in 1990 knowing that we would one day be in government and intending to take advantage of it to base a proper Pharmaceutical Benefits Scheme.This is an opposition who are now consumed by oppositionism for the sake of it. They have no principle. There were people on this side who thought the opposition could not become more opportunistic after the demise of the member for Brand—we thought it would not be possible—and yet Australia's greatest political opportunist, a man who voted for a copayment in 1990 and for an increase, stands there now with no concern for medicine.K26Latham, Mark, MPMr Latham—Mr Speaker, I rise on a point of order. I draw your attention to your statement of 9 June when you said, `I don't like personalities coming into question time. There has been too much emphasis on personalities.' How can you tolerate a Treasurer who has no interest in public policy and just rants and raves on about personalities, past and present?10000SPEAKER, TheThe SPEAKER—I, and the overwhelming majority of members of this House, deplore the use of anything that refers to personalities and I endeavour to discourage it. I do so, as the standing orders provide.383314:29:003833Smith, Stephen, MPMr STEPHEN SMITH5V5PerthALP00—My question is also to the Treasurer. I refer to the Treasurer's earlier answer when he said that Labor introduced the pharmaceutical benefit copayment for pensioners. Is it not the case that, when Labor introduced and subsequently increased the pensioner copayment, pensioners were more than fully compensated for the increases by a rise in the pension through the pensioners pharmaceutical allowance? Isn't it the case that when the coalition hiked up the PBS copayment for pensioners in 1996 there was no corresponding increase in the pension, as is the case with this year's budget proposal? Don't the coalition PBS increases leave pensioners up to $88.40 worse off for the cost of their essential medicines than when Labor left office in 1996?3833Costello, Peter, MPMr COSTELLOCT4HigginsLPTreasurer10—No. Of course—Opposition members interjecting—10000SPEAKER, TheThe SPEAKER—The Treasurer is entitled to be heard in silence and I expect that courtesy to be extended to him.DT4Crean, Simon, MP10000SPEAKER, TheThe SPEAKER—Leader of the Opposition! The Leader of the Opposition understands his obligations.CT4Mr COSTELLO—I am sorry to interrupt his interjections, Mr Speaker, but I can say, in relation to the government's proposals, which take the cost recovery back to 19 per cent—lower than it was when the Labor Party introduced it at 21 per cent—that we also have a proposal which says that, after 52 scripts in a year, they are free.DT4Crean, Simon, MPMr Crean—What about compensation?10000SPEAKER, TheThe SPEAKER—Leader of the Opposition!CT4Mr COSTELLO—In addition to this, this government—the first government in Australian history to do so—has by law indexed the pension to 25 per cent of male total average weekly earnings, which will increase the pension by $10 per fortnight this year.5V5Smith, Stephen, MP10000SPEAKER, TheThe SPEAKER—Member for Perth!CT4Mr COSTELLO—It had never previously been legislated—5V5Smith, Stephen, MP10000SPEAKER, TheThe SPEAKER—Member for Perth!CT4Mr COSTELLO—for the pension to be indexed to 25 per cent of male total average weekly earnings.5V5Smith, Stephen, MP10000SPEAKER, TheThe SPEAKER—I warn the member for Perth!CT4Mr COSTELLO—And because of that—and because earnings are increasing faster than inflation—the pension is moving faster than costs, including costs which are built into the consumer price index, and will increase by $10 a fortnight over the course of the next two periods of indexation. So, although there is the $1 contribution, which can amount to a maximum of $52 per annum—thereafter, prescriptions are free—over that period the pension will increase by $10 per fortnight. I come back to this simple proposition—5I4McMullan, Bob, MP10000SPEAKER, TheThe SPEAKER—Member for Fraser!CT4Mr COSTELLO—We know that the Labor Party are not opposed to a copayment, because the Labor Party introduced it.DT4Crean, Simon, MPMr Crean—So it is a GST compensation payment.CT4Mr COSTELLO—We know that the Labor Party are not opposed to increasing the co-contribution—DT4Crean, Simon, MPMr Crean—With compensation!CT4Mr COSTELLO—because they increased it by 36 per cent for non-pensioners in 1990—without any compensation, so I do not know why he interjects about compensation. We know that the Labor Party agree that 21 per cent is a fair cost recovery on the scheme, so what possible opposition could they have to a 19 per cent recovery? As Treasurer Keating said:The alternatives are stark: reconstruct the scheme so that it remains fair for everyone, or lose the scheme altogether ...Do you know why he said that in 1990? Let me remind you. He was worried that in three years the cost would reach $2 billion per annum. What is it today? It is $4.2 billion per annum; and the Labor Party are trying to knock the co-contribution down to 15.9 per cent. This is an opposition which is now more irresponsible than any previous opposition in Australian history, one which lacks leadership, lacks principle and lacks policy. At the end of the day, it is the people who rely on this scheme who will suffer because of Labor Party opportunism.383414:33:003834Gambaro, Teresa, MPMs GAMBARO9K6PetrieLP10—My question is addressed to the Minister for Foreign Affairs. Would the minister update the House on his discussions yesterday with Mr Michel Gabaudan, the regional representative of the United Nations High Commissioner for Refugees, about the refugee situation in Afghanistan and the broader issue of people-smuggling? Is the minister aware of any alternative views on this issue?3834Downer, Alexander, MPMr DOWNER4G4MayoLPMinister for Foreign Affairs10—I thank the honourable member for Petrie for her question. I think her constituents are very grateful to her for the support she gives to the government on the issue of border protection. She is certainly strong on border protection. Yesterday I had a very constructive discussion with Michel Gabaudan, the regional representative of the United Nations High Commissioner for Refugees. He briefed me in particular on the high rate of return of Afghanis to Afghanistan. Indeed, interestingly, the United Nations High Commissioner for Refugees expects around two million people to return to Afghanistan to live by the end of this year. This obviously puts some strain on the United Nations High Commissioner for Refugees and other aid organisations operating in Afghanistan, and I gave an undertaking to Mr Gabaudan to ensure that our aid commitments were delivered as quickly as possible—indeed, we are accelerating some of the payment of those aid commitments.I also had a useful discussion yesterday with the Iranian foreign minister about the situation in Afghanistan at the political level, particularly with the Loya Jirga having concluded now and with the election of the former interim president as the now temporary president of Afghanistan. There is no doubt that there is a general view that, although the situation is still complex and difficult in Afghanistan, there is a degree of stability entering the country now.Mr Gabaudan and I also spoke about the very close and effective cooperation that there has been between our immigration officials and the UNHCR in Nauru. I was able to brief Mr Gabaudan on my discussions with President Harris last week and to thank him for the very good work that the UNHCR has done in Nauru.I did take the opportunity, not surprisingly, of assuring Mr Gabaudan that this government is going to remain strong on border protection. Regardless of what the opposition says or does, our commitment to border protection is going to remain strong. I did make clear to him that we in Australia do not appreciate ill-informed criticism of Australia's policy from international organisations, such as some of the United Nations agencies. Indeed, I did say to him that such criticism undermines national support for United Nations agencies and that it is not what we pay the United Nations to do.83TRudd, Kevin, MP10000SPEAKER, TheThe SPEAKER—Member for Griffith!4G4Mr DOWNER—The member for Griffith interjects. The member for Griffith always has something to say. He reminds me of Sir Robert Menzies' epithet that more people have talked themselves out of this chamber than have ever talked themselves in. That may indeed be the member for Griffith's fate. Yesterday, the member for Griffith talked about the government unleashing a jihad against the United Nations. I would have thought that a rather inappropriate term for a spokesman on foreign affairs to use. This is because apparently the member for Griffith, when it comes to standing up in the parliament, joins in Labor's current bout of criticism against the government's border protection policies. Yet I read in the Financial Review this morning that, during the caucus discussion yesterday on the excision of further islands from the Australian immigration zone, a lot of members, such as the member for Lingiari, supported the Leader of the Opposition but some members expressed concern and, indeed, implied that they opposed the Leader of the Opposition. One of them was the garrulous member for Griffith who was, according to the Financial Review, among some party members who highlighted the concerns in the electorate. In other words, the member for Griffith says one thing in this chamber, he says another thing when he gets into the caucus room—and goodness knows what he says when he gets back to his electorate.This demonstrates how the Labor Party, in the lead-up to the election, tried to communicate a message to the public about being strong on border protection. But, as soon as the election was over, there was a revolt in the Labor Party by what you might call the pseudo-intellectual bourgeois Left—the epitome of which is the member for Fremantle. She is perhaps more bourgeois Left than pseudo-intellectual. These are the people who have cast aside the traditions of Curtin and Chifley. These are the people who have cast aside the Labor Party as the party of working people and who have turned it into the cafe latte party. These are the people who are now getting the upper hand in the debate within the Labor Party on the whole issue of border protection. The fact is simply this: the Labor Party is weak on border protection and this government is strong. 383514:39:003835Swan, Wayne, MPMr SWAN2V5LilleyALP00—My question without notice is directed to the Treasurer. Treasurer, is it a fact that since your government came to power the pension has dropped below average weekly earnings 10 times? Treasurer, haven't you misled Australian pensioners, who will be up to $88.40 a year worse off through the cost of essential medicines in your budget? Will you stop misleading Australian pensioners?3835Costello, Peter, MPMr COSTELLOCT4HigginsLPTreasurer10—I think the question was about the pension going below average weekly earnings. That would be the case, because the pension is linked to 25 per cent of male total average weekly earnings, not to average weekly earnings.ZD4Howard, John, MPMr Howard—Males—you know that. He is the one that has misled the House.CT4Mr COSTELLO—If that was supposed to be a cunning little trap in the question, it did not work. This was the government which indexed by law the pension to 25 per cent of male total average weekly earnings. The indexation points are twice yearly, as they were under the Australian Labor Party—twice yearly. If the pension has dipped below 25 per cent of male total average weekly earnings, it is indexed to the 25 per cent mark or it is indexed to the CPI, whichever happens to be the higher. In a period like the late 1980s when inflation was high and the increase in real wages was negative, as it was under the accord, you would want your pension to be indexed to the CPI because it would be higher. In a period like the late 1990s when wages growth is outstripping the CPI—that is, you have got a real wage increase—you would want it to be indexed to 25 per cent of male total average weekly earnings. That is why we have the two markets and that is why, under this government—the first government to actually legislate that—the increases have been greater than they would have been under the CPI.In addition to that, when the government introduced tax reform, we also had a four per cent increase in the pension, a two per cent guarantee rule and indexed. This is the government that legislated the change. Because wages ran higher than CPI, pensioners benefited; they had a real increase in the pension. This is the government that has ensured that people on pensions have been protected against both of those markets.In relation to the Pharmaceutical Benefits Scheme, this is the government which intends to get that onto a financially sustainable basis. If the Labor Party is successful in its sabotage operation—let me make it clear—it will not help the people in this country who rely on the Pharmaceutical Benefits Scheme. This is short-term opportunism and bad policy. It was not the policy of Labor Unity or the Socialist Left in the 1990s, it was not the policy of responsible Labor people and it was not the policy of the member for Hotham in the 1990s when he voted for those changes. This is short-term political opportunism, and it will be exposed for what it is.383614:43:003836Ciobo, Steven, MPMr CIOBO00AN0MoncrieffLP10—My question is to the Minister for Education, Science and Training. Would the minister inform the House of progress in the government's higher education review? Is the minister aware of other statements and policies in this important area?3836Nelson, Dr Brendan, MPDr NELSONRW5BradfieldLPMinister for Education, Science and Training10—I thank the member for Moncrieff for his question and for his very strong commitment, along with the member for Forde and the member for McPherson, to Griffith University. This government is very much committed to seeing that Australian higher education serves Australia—not only Australian students today but in particular the next and subsequent generations. For that reason, as the minister, I have initiated a review of Australian universities. We have released the first of a series of around six discussion papers to inform the public debate. A specialist unit has been established within my department, and I have had seconded to that unit a person from the Australian Vice-Chancellors Committee and from the Business Council of Australia. I have established a reference group to help guide me through the process, and I have had consultations right throughout the sector with university vice-chancellors, pro-vice-chancellors, academics and unions, including the National Union of Students.The Australian Vice-Chancellors Committee released a response to the first discussion paper two days ago. It is rather interesting that in that context the President of the Australian Vice-Chancellors Committee was reported in the West Australian yesterday as saying:Each university must have substantial choice in determining its future, so that it meets changing social and economic needs.Further to that, an article in today's Australian under the headline `Full marks to uni chiefs for reform push' says:Already, Australians are labouring under record high levels of income tax, and plundering taxpayers more to fund higher education will simply penalise those who seek to better themselves ...The root of the problem is not a lack of money but the suffocating controls placed on our universities by our model of bureaucratic centralised control.Further on, the article says:At last, politics may be turning in favour of a smarter nation. I am asked about other statements or policies. Within microseconds of the Australian Vice-Chancellors Committee releasing its considered response to the first ministerial discussion paper, the Labor Party and the member for Jagajaga were out there opposing it and attacking the Australian Vice-Chancellors Committee for its considered package of reforms, which it has put to the government for my consideration when looking at the future of Australian higher education. The member for Jagajaga and the Labor Party have attacked any concept of deregulation, of freeing up bureaucracy, in relation to Australian universities. In relation to the university sector, the question which Australians would be asking themselves today—and certainly callers to my office have been asking this—is: does the Labor Party oppose or support deregulation? The reason for that confusion is that the member for `Werra Werra' authored a book—Honourable members interjecting—RW5Dr NELSON—I like to call him `Werra Werra', but the member for Werriwa, in a book entitled What have you learnt today—imagine who that was targeted at!—said:Governments need to look beyond the mad ideologues and the vested interests in the education debate in this country and develop a fresh policy frontier.He went on to say:Left wing politics refuses to support education other than through government spending, even though the fiscal well has run dry.This is what we mean when we talk about alternative policies, which the Leader of the Opposition spoke to Ray Hadley about earlier in the month. We might be reminded that, when the member for Brand was the Leader of the Opposition, we had these pathetic scenes of him, after six years of leading the Labor Party, standing behind a sign that said, `This is what I stand for.' Now we have the current Leader of the Opposition in a sandwich board, which says on the front what he stands for. He says, `If I am talking to the mad ideologues, I have a particular message and I am opposed to any sort of deregulation. But if, on the other hand, I am talking to people who want to talk about policy, like the member for Werriwa, then I turn around and let them look at the other side of the sandwich board.' The Leader of the Opposition needs to take off his sandwich board and let Australians see what sort of policy ticker actually lies within it. As Ross Gittins said in today's Sydney Morning Herald—and this is prescient advice for the Leader of the Opposition:So Labor ... will need to have summoned up a lot more courage before the next election because the question of “where the money's coming from” is the greatest stumbling block standing between us and our future as a knowledge economy.We as Australians face very serious policy choices in relation to Australian higher education. One of those issues is funding, but it is also about governance, administration, specialisation within the sector, strengthening regional universities, and broadening opportunities for Australians from Aboriginal, low-income and rural and regional backgrounds to give them a place and a ticket for a start in the 21st century of education and knowledge.383714:49:003837Jackson, Sharryn, MPMs JACKSON00AN2HasluckALP00—My question is to the Treasurer. I refer to the Treasurer's threat yesterday that he would make sure that new medicines would not be listed on the PBS if his legislation to increase the cost of essential medicines by up to 30 per cent was blocked. Can the Treasurer advise the House which of the new medicines for the treatment of diabetes, asthma and arthritis currently awaiting final PBS listing approval will be refused as a result of his political blackmail?1Costello, Peter, MPMr COSTELLOCT4HigginsLPTreasurer10—Obviously I did not say that to the House yesterday. Hansard, of course, will totally record what I said yesterday.Opposition members interjecting—10000SPEAKER, TheThe SPEAKER—The Treasurer has the call.CT4Mr COSTELLO—What I said yesterday in the House is in Hansard, and I stand by it absolutely. Back in 1990 when the Labor Party was worried that the cost of the Pharmaceutical Benefits Scheme might go to $2 billion a year, it said—and I totally agree with it:The alternatives are stark—this is the government's position—reconstruct the scheme so that it remains fair for everyone, or lose the scheme altogether, so that access to complete health care would only be available to the wealthy.If we do not get this scheme onto a proper sustainable base, access to the scheme and the kinds of treatments that Australians want will be available only for the wealthy. That was said in 1990 when Labor was worried the cost might go to $2 billion per annum. Today it is at $4.2 billion per annum. The Labor Party ought to try to come to grips with this one proposition: if it was responsible in 1990 for copayments to recover 21 per cent of the cost, why is it not responsible today for copayments to recover 19 per cent of the cost? Why? Bearing in mind that it was responsible for 21 per cent in 1990, what level does the Australian Labor Party say it is responsible for today?If you do not have this on a sustainable basis, fewer new treatments will be financially affordable in the future. This was the point that was made by Paul Keating and Brian Howe. This was voted for by the member for Hotham. There are a lot of Labor Party backbenchers who cannot remember a time when Labor thought like an alternative government. There was a time—it was not always this unconscionably opportunist. It used to think about how to manage the Pharmaceutical Benefits Scheme. After the term of the member for Hotham's leadership it may go back to that, because the irresponsible opportunism did not work on the GST. Remember back to then: remember when he came in day after day on the GST and remember where it ended. He is coming in day after day on these matters, and let me make a prediction: it will not end in any better outcome for the Labor Party. We can remember the great hilarity of the Labor Party on GST. They said that lettuces would go up and Hockey Bear pyjamas would go up, and Labor would cruise their way into office. It is no different today: they say the PBS will go up, or something else will go up, and they think they will cruise into office. But opportunism did not work for the last six years and it will not work for the next three. The people of Australia deserve much better than that; they deserve a political party that are thinking about how to balance a Pharmaceutical Benefits Scheme, which will help the poor and ensure they have access to pharmaceuticals for their needs.383814:54:003838Forrest, John, MPMr FORRESTNV5MalleeNP10—My question is addressed to the Treasurer. Would the Treasurer advise the House of the results of the June consumer sentiment index released today? What does this survey indicate about the optimism of Australian consumers?3838Costello, Peter, MPMr COSTELLOCT4HigginsLPTreasurer10—I thank the honourable member for his question and for his interest in relation to the Australian economy. He may be aware that today Westpac released its consumer sentiment for the month of June, showing that the Westpac-Melbourne Institute index of consumer sentiment rose 2.5 per cent to 112.9. These sentiments rise and fall and one has to bear in mind that there is a lot of variability in them—I have always made that point. But the interesting thing about this was that this sentiment rose. In commenting upon the sentiment, Westpac said:It appears that genuinely positive news on the Australian dollar, employment and economic growth has buoyed the consumer. The Australian dollar had risen, peaking above .57 cents since the previous survey, the unemployment rate was confirmed at 6.3 per cent and the statistician announced 75,000 new full-time jobs had been created in May. It was recently announced that growth for the last year was a very strong 4.2 per cent, amongst the highest in the world.So according to Westpac those things have brought together consumer confidence. Consumer confidence is a good thing; it is what gives people the confidence to go out and buy goods and services to create markets for producers and keep employment opportunities ticking along. The fact that employment was strong in May is particularly good news. These were the figures that caused a bit of consternation amongst the Labor Party—that the number of jobs was growing. But jobs growth is good for Australia; new jobs are good. And the fact that the unemployment rate is now down to 6.3 per cent from the 8.6 per cent when the government came to office is actually a good thing for those Australians who want job opportunities.I think it is important that good economic policy continues so that consumer sentiment can continue—and that becomes mutually self-reinforcing. The Australian consumer was in a sunny and optimistic mood through the course of late 2001 and early 2002, notwithstanding September 11 and a number of high profile crashes. I pay tribute to the Australian consumers. They were sunny and optimistic, and that kept Australia's growth rate above that of the other industrialised economies of the world. The fact that Australia has grown strongly through this period means that we can have more jobs growth. I believe that, if the Australian economy continues to grow at 3½ to four per cent, if this government were able to accomplish its industrial relations reform agenda and if this parliament were able to seize the historic opportunity for welfare reform, we could have the kinds of unemployment outcomes that all of us would want: young people having the opportunity to work, an unemployment rate of 6.3 per cent and going lower—because it is still high—and Australians having wonderful opportunities into the future.383814:58:003838Crean, Simon, MPMr CREANDT4HothamALP00—My question is to the Treasurer and it relates to his answer to the member for Hasluck's question, and to his invitation to check the Hansard in terms of what he had to say yesterday. Treasurer, didn't you say yesterday that, if your 30 per cent hike in pharmaceuticals does not get through, you `will be forced to take a much tougher attitude on the listings of new pharmaceutical benefits'? Can you advise the House which of the new medicines for the treatment of diabetes, asthma and arthritis currently awaiting final PBS listing approval will be refused as a result of your blackmail?3839Costello, Peter, MPMr COSTELLOCT4HigginsLPTreasurer10—It is my hope and it is this government's position that none of them should be refused entry, and there is one way in which none of them can be refused entry: you can pass the budget measures. There is this idea that we are going to give up fighting for our budget measures because the Australian Labor Party is engaging in opportunism. We are not. We are going to fight for our budget measures—that is why you elect governments. It is commonly said that governments sit on the Treasury bench. Why? So they can introduce budgets and they can fund government services. The Senate is not elected to bring down budgets. As it turned out, during the last election the Labor Party was not elected to government. As Mr Keating said in 1990, as Brian Howe said in 1990, as members of the Labor Party—UK6Thomson, Kelvin, MP10000SPEAKER, TheThe SPEAKER—I warn the member for Wills!CT4Mr COSTELLO—who want to be seen as economically responsible are now privately saying, it would be responsible for the copayment to recover 19 per cent of the scheme, bearing in mind that Labor's benchmark was 21 per cent. That is why we hope all of those and all of the yet to be invented medicines can come onto this scheme. But the only way to ensure that they can come onto this scheme is to have this scheme work on a financially viable basis. To the Australian Labor Party we say this: it is the people who genuinely care about this scheme who care enough to reform it and make it sustainable. That is the bottom line. This idea that the Australian Labor Party cares about the scheme so much that it will oppose the measures that make it financially sustainable is a fraud. It illustrates that the Labor Party is nothing but opportunist. If you were ever to be elected and form a government, you would want to increase these fees. It would most probably be one of the first things you did. I would be very interested to know whether the Leader of the Opposition will go outside this House and give a guarantee that he will never, if he becomes Prime Minister, raise the copayment on the Pharmaceutical Benefits Scheme. We would be very interested in that, wouldn't we? There are 20 yards to bravery—walk outside, stand up and give this pledge: you are so opposed to increased copayments in the Pharmaceutical Benefits Scheme that you will never, as the Leader of the Labor Party, increase them. But he will not do that, because he introduced them. You introduced the copayment. You increased the non-pension concession by 36 per cent. You set the benchmark at 21 per cent and now you pretend you will be horrified if it ever goes above 15.9. We will watch to see your undertakings, but you are exposed in the Senate for the political opportunist that you are.DT4Crean, Simon, MP10000SPEAKER, TheThe SPEAKER—If the Leader of the Opposition actually wants to know whether or not I am serious about discharging the standing orders, he will continue interjecting as he has done. Everyone in this House is entitled to be heard in silence, as the standing orders make clear.383915:04:003839Billson, Bruce, MPMr BILLSON1K6DunkleyLP10—My question is to the Minister for Employment and Workplace Relations.Opposition members interjecting—10000SPEAKER, TheThe SPEAKER—Let me place on the record the simple fact that the majority of people in this House are never warned by the Speaker. Those who are are persistent interjectors. They destroy the reputation of the entire chamber. The member for Dunkley will be heard in silence.1K6Mr BILLSON—Would the minister inform the House how ultramilitant union activity has damaged investment and jobs in Victoria? What steps is the federal government taking to produce a better workplace relations climate in Victoria, and has there been any response? What obstacles exist to improving the industrial climate in the great state of Victoria?K26Latham, Mark, MPMr Latham—Mr Speaker, I rise on a point of order under standing order 146. This question is identical to the question that was asked yesterday, referring to ultramilitant unions in Victoria and the impact on Victorian workers and taxpayers. I would ask you under the standing order to rule it a question that has already been asked and answered in the House and to rule it out of order.10000SPEAKER, TheThe SPEAKER—The member for Werriwa has the Hansard with him, and I do not have it immediately with me. I listened to the question. It certainly has a number of parallels to yesterday's question. I would be astonished if it were the same. My experience in the House has been that identical questions are not asked. I will presume that it is not identical and recognise the minister.3840Abbott, Tony, MPMr ABBOTTEZ5WarringahLPMinister for Employment and Workplace Relations and Minister Assisting the Prime Minister for the Public Service10—I thank the member for Dunkley for his question and for his strong support of freer and fairer workplaces in the great state of Victoria. Because this government has transformed workplace relations in this country, those remaining ultramilitant union officials stand out like dinosaurs at the zoo. Victoria does have a good workplace relations system. Unfortunately, it is still bedevilled by a culture of ultramilitants, of mindless militants, in a few key unions in a few key industries. A classic case is the Japanese food giant Saizeriya, whose planned $400 million investment in jobs in Victoria has been jeopardised because of a turf war between the AMWU, which has the largest single block vote in the Victorian ALP, and the NUW, whose boss is the national president of the ALP. The State Director of the Victorian Department of State Development said:Thanks to this dispute, Victoria's reputation as a place to invest would be significantly damaged.He went on:I believe that the damage caused by the failure to stop the industrial action and the possibility that Saizeriya will not continue with this project will impact on Victoria's reputation outside of Japan.He said that because of this industrial disputation:The present value of the increase in gross state product that could be lost over the next 10 years is estimated at between $575 million and $800 million.He went on to say:Between 1,500 and 3,000 new jobs could be lost if this investment does not go ahead.Union militancy costs jobs. The situation at Saizeriya is just the tip of the iceberg in terms of lost jobs because of union militancy in Victoria. The Victorian government, it seems, is at last starting to wake up to the high price of union militancy. According to today's Age, the Victorian government is now considering whether to allow federal workplace inspectors on a Victorian government building site. Good on them. The state Minister for Major Projects has said, `The law has got to apply'—that is both the Victorian law and the Commonwealth law—and we accept that. Good on that state minister. Will his party allow him to do that, because the most militant unions are precisely the unions that bankroll the Labor Party. Over the last six years the AMWU has donated $3 million, the CFMEU has donated $2.7 million, the CEPU has donated $2 million, and they are going to dominate the Victorian ALP thanks to the Socialist Left takeover that is being engineered—2V5Swan, Wayne, MPMr Swan—Mr Speaker, I rise on a point of order. Under standing order 145, yesterday when the minister was clearly out of order answering a similar question, you asked him to sit down. I ask you to ask him to do that because he is out of order and irrelevant.10000SPEAKER, TheThe SPEAKER—I was following closely what the minister was saying. I invite him to conclude his answer. EZ5Mr ABBOTT—I was asked about obstacles to better workplace performance in Victoria. Today's Age likened the Victorian Labor Party to the set of Big Brother with the contestants all struggling to work out who was going to be ejected next.2V5Swan, Wayne, MPMr Swan—Mr Speaker, I rise on a point of order. The minister is defying your ruling—10000SPEAKER, TheThe SPEAKER—The Manager of Opposition Business will resume his seat. I will deal with the minister. I invited the minister to conclude his answer. I have not declared that his answer was out of order. I invite him to conclude his answer.EZ5Mr ABBOTT—On the question of the obstacles to a better system, the Leader of the Opposition cannot decide—7T4Crosio, Janice, MP10000SPEAKER, TheThe SPEAKER—The member for Prospect!EZ5Mr ABBOTT—whether to rat on his mate Sword or his ally Shorten. The problem is not the fifty-fifty rule; it is the 100 per cent rule—2V5Swan, Wayne, MPMr Swan—Mr Speaker, on a point of order: the minister clearly spoke in defiance of your ruling—10000SPEAKER, TheThe SPEAKER—The Manager of Opposition Business will resume his seat!2V5Swan, Wayne, MPMr Swan—I raised a point of order, Mr Speaker, and I expect the call.10000SPEAKER, TheThe SPEAKER—The Manager of Opposition Business was granted the call. He was heard. I did not hear—2V5Swan, Wayne, MPMr Swan—You did not let me conclude.10000SPEAKER, TheThe SPEAKER—I will not tolerate this sort of effrontery from the Manager of Opposition Business! In fact, not only did I hear him; I was denied the opportunity to hear the latter part of what the minister was saying by the interjection of the member for Prospect so I was at a distinct disadvantage.2V5Swan, Wayne, MPMr Swan—On the point of order, Mr Speaker: there seems to be a much lengthier period between what takes place on that side of the House and when people are pulled into order on this side of the House.10000SPEAKER, TheThe SPEAKER—I warn the Manager of Opposition Business! I go out of my way to exercise fair judgment on all issues. I will not tolerate that sort of reflection on the chair.384115:12:003841Smith, Stephen, MPMr STEPHEN SMITH5V5PerthALP00—My question is to the Treasurer and it relates to his answer to my earlier question to him. He was referring to the cost of the Pharmaceutical Benefits Scheme and he asked this question when referring to the cost of the scheme: `What is it today? $4.2 billion per annum.' Is the Treasurer aware of the statement by the former health minister, Dr Wooldridge, on Meet the Press on 3 June last year when Dr Wooldridge said in respect of the scheme:We are giving it to more people. We have got new and exciting pharmaceuticals coming onstream and that actually keeps people out of hospital. There is some real public benefit here.He went on to say:It is going to be $4.2 billion next year, and it is sustainable.Treasurer, why did the government tell one story about the cost and sustainability of the Pharmaceutical Benefits Scheme before the election and a different story after?3841Costello, Peter, MPMr COSTELLOCT4HigginsLPTreasurer10—The Pharmaceutical Benefits Scheme is costing $4.2 billion per annum. Back in 1990, the Australian Labor Party took the view that we could not sustain $2 billion. What this government is doing is putting in place reasonable measures which any government in this position would put in place. If the Australian Labor Party had leadership, it would be putting them in place, too. In fact, when the Australian Labor Party did have leadership, it was putting them in place and everybody who was here in 1990 on the Australian Labor Party side voted for them. Everybody in the Australian Labor Party thought that was responsible and the Liberal and National parties, in opposition, supported them. That is the difference. Why? Because we know what is required to have a sustainable Pharmaceutical Benefits Scheme.The Intergenerational Report puts forward that over the next 40 years, in current nominal dollars, the scheme will cost about $160 billion. Is there anybody in Australia who believes that the Commonwealth could run a scheme at $160 billion in today's dollars? There is nobody. There is nobody on the Labor side, nobody in the gallery, nobody in the industry and no economist who believes that. So what do we have to do? We have to start putting in place, as Paul Keating said, measures to make it sustainable, that is, $1 per week maximum for a pensioner—5V5Smith, Stephen, MPMr Stephen Smith—Mr Speaker, I rise on a point of order. My question was not about 1990 or 2041; it was about the former health minister saying that it was $4.2 billion at the start of the last year.10000SPEAKER, TheThe SPEAKER—The member for Perth does not have a point of order. The standing orders require that the Treasurer be relevant.CT4Mr COSTELLO—and for non-pensioners a maximum of $28.60. But that does not mean people will pay $28.60. As I have said in newspapers, for Ventolin and some such things, anything below that stays at the same price. It is a maximum; it is only when a prescription is more than that price that you pay $28.60. When we cut through all of the opportunism, both sides of politics know what has to be done. Over the years, both sides of politics have argued that it has to be done. This side of the parliament voted for it in government and in opposition. The other side of the parliament voted for it in government but now in opposition want to do the opportunistic thing. That is the bottom line. Why? Because they think there is a political advantage in making this scheme unsustainable. Perhaps they hope that it will break while we are in government and they can take the political credit for that. But the people of Australia have to know this: this is a government which is putting these measures into the Senate. This is a government which wants to pass them. We want to pass them because we want to help the health of Australia. 384215:17:003842Kelly, De-Anne, MPMrs DE-ANNE KELLYFK6DawsonNP10—My question without notice is to the Minister for Children and Youth Affairs, representing the Minister for Family and Community Services. Could the minister advise the House on increased assistance to families under the family tax benefit and child-care benefit? Is the minister aware of any alternative policies to assist Australian families?84SO'Byrne, Michelle, MP10000SPEAKER, TheThe SPEAKER—I warn the member for Bass!3842Anthony, Larry, MPMr ANTHONYXJ6RichmondNPMinister for Children and Youth Affairs10—I would like to thank the member for Dawson, who has a firm commitment to families. Indeed, one of the greatest things the coalition government has done is introduce family tax benefit, which, when the new taxation system came into place, meant $2 billion extra going to two million Australian families, assisting four million Australian children. The other benefit was through the child-care benefit, which now directly contributes to over 480,000 families. The good news is that, as of 1 July, there will a 3.1 per cent increase in the amount paid for family tax benefit, again going to those two million Australian families. The maximum rate of family tax benefit part A will increase by $3.78 to bring it to an annual amount of $3,303 for a child under the age of 13, and for families with children between 13 and 15 the increase will be by $4.90, bringing it to an annual amount of $4,190. Likewise, there will be a 3.1 per cent increase to all those families receiving family tax benefit part B and the income thresholds will be raised by $950 per year to $30,806 before it affects their part A payment, and the payment will stop at an income of $83,184 for a family with one child under the age of 13. In child care, there will be another 3.1 per cent increase. Child care has been an outstanding success of the coalition government. We have 712,000 children now using some form of Commonwealth funded child care. There are more kids than ever in child care, at a cheaper cost than it has been for a long time and of a much higher quality.The member for Dawson rightly asked me whether there are any alternative policies. The only policy is the pretend policy between work and family. In child care alone, in 18 months in this parliament we have had one question from the opposition on child care. The premier women's support organisation for the Australian Labor Party is Emily's List, headed by none other than Joan Kirner. Their key priority is child care. What sort of proud record are they looking at when the federal Australian Labor Party has asked only one question in the last 18 months.Recently, a bizarre situation occurred—well intentioned, perhaps—when the member for Gellibrand was criticising the coalition, saying that not enough money was going into preschools. The interesting thing is that preschool funding—for your benefit—is the responsibility of state governments. This is an excellent opportunity for the member for Gellibrand to knock on the door of every state minister and get them to put more money into preschools. Certainly, in New South Wales it has been frozen for the last 11 years.The only family that the Labor Party are interested in is their trade union family and they are going through terrible separation pains at the moment. In a spirit of goodwill, I am happy to organise some family counselling or refer them to the Men's Line because I know there are a lot of men in the Australian Labor Party and Victorian trade union movement who need a lot of counselling.384315:21:003843McMullan, Bob, MPMr McMULLAN5I4FraserALP00—My question is to the Treasurer and follows those asked previously concerning cuts to disability support pensions and pharmaceutical benefits. Treasurer, why are you inflicting these cuts on vulnerable Australians when, at the same time, you are trying to get through this parliament for foreign business executives a foreign income tax exemption worth $200 million over four years? Why do foreign business executives get millions at the same time as you are cutting money from Australians with disabilities and those who need essential medicine?3843Costello, Peter, MPMr COSTELLOCT4HigginsLPTreasurer10—Mr Speaker, the question was false. As the Prime Minister has already said in question time, the government is not cutting the benefits of the disability support pension. In relation to the Pharmaceutical Benefits Scheme, which currently recovers 15.9 per cent, we are restoring that to 19 per cent of costs, which is lower than it was under the Australian Labor Party. These are measures which members of the Labor Party have, in their better moments, claimed should be taken.In relation to tax policy, we went to the last election with a tax policy; it was released on 15 October 2001. The measure that I was asked about was part of our tax policy. I notice that the Australian Labor Party now believes, having lost the election, that it has the right to defeat the government in implementing the policies that it took to the election. There used to be a doctrine that the Senate would hold the government to its election policy; the new doctrine from the Labor Party is that the Senate will force the government not to deliver on its election policy.It is not only in the area of tax where the Labor Party, having lost the election, believes it can defeat the implementation of the government's policy; it is also in the area of superannuation. The Labor Party has just defeated regulations on the Financial Services Reform (Consequential Provisions) Bill 2002. It reserves the right to defeat budget measures of the significance of the Pharmaceutical Benefits Scheme. As I think the Prime Minister said, this opposition not only is the most vicious in using the Senate to defeat the government but is indicative of an opposition which has still not come to terms with its election defeat.YU5Tanner, Lindsay, MPMr Tanner—Ever heard of John Kerr?10000SPEAKER, TheThe SPEAKER—I warn the member for Melbourne! CT4Mr COSTELLO—We put our tax policy out there and we were elected on it. The opposition would be entitled to criticise us if we did not come into this parliament and move legislation to implement our policy.R36Albanese, Anthony, MPMr Albanese—That is what we have done.CT4Mr COSTELLO—No, you have not. You have come into this place and criticised us for moving to implement our policies. With all due respect to the member for Grayndler, he has just walked into the biggest political non sequitur you have ever seen. You are now demanding that the government not implement its political policy. You are not demanding that we implement it; you are demanding that we break it.10000SPEAKER, TheThe SPEAKER—Treasurer!CT4Mr COSTELLO—The policy was the taxation of expatriates and it was released on 15 October 2001. I will table the policy; it is the policy, released before the election, that you now demand that we break and that you are gearing up to defeat in the Senate. If the Labor Party thinks that it now has a mandate to defeat the election policies of an elected government, so be it. We do not think that the doctrine of democracy in a Westminster system extends to that degree, but so be it.10000SPEAKER, TheThe SPEAKER—Before I recognise the member for Prospect on a point of order, I remind the Treasurer that, owing to the chastening words from the member for Corio yesterday, I am obliged to indicate to all members the obligation they have to address remarks through the chair.7T4Crosio, Janice, MPMrs Crosio—Mr Speaker, I rise on a point of order. Seeing he tabled the policy he purported to have in 2001, I would like to ask the Treasurer to table his pharmaceutical benefits—10000SPEAKER, TheThe SPEAKER—The member for Prospect is warned!384415:26:003844King, Peter, MPMr KING00AMQWentworthLP10—My question is directed to the Minister for the Environment and Heritage. Can the minister advise the House of the community response to the Howard government's Envirofund for the repair and conservation of Australia's unique environment and natural heritage? Is he aware of any alternative policies?3844Kemp, Dr David, MPDr KEMPBT4GoldsteinLPMinister for the Environment and Heritage10—I thank the honourable member for Wentworth for his question and congratulate him on his great support for environmental groups in his local area. The Australian government's Envirofund, to which the honourable member referred, is a crucial component of the $1 billion of new money that the government is putting into the Natural Heritage Trust. This is money that is going to empower small groups and individuals to repair their own local environments, whether they are city based or whether they are in outback communities. The Howard government's $20 million Envirofund provides grants of up to $30,000 through the Natural Heritage Trust for programs such as replanting native trees and shrubs, training for land carers, monitoring water quality and endangered species and restoring their habitats.I am delighted to inform the House that hundreds of groups and individuals from every Australian state and territory have responded overwhelmingly to the government's new initiative. We now have 1,751 applications for grants under the Envirofund, which is twice the level of interest shown last year for Natural Heritage Trust Fund grants of the same dimension. In other words, the government's commitment to local communities is undoubtedly lifting the interest of local communities and local groups to do something positive to restore their natural environment. It is changing the culture of communities around Australia and the Envirofund response is reflecting the fact that we are committed to a successful policy that empowers local communities to act effectively in relation to their environment.Under the first phase of the Natural Heritage Trust, we have already seen 400,000 volunteers joining the great endeavour to attack environmental problems at the local level. I thank the states for their role in administering this particular program and for monitoring the grants. By contrast, it is very disappointing that all we have heard from the opposition is attitude, platitude and a complete lack of gratitude to the 400,000 volunteers whose sweat and commitment are making a difference to Australia's environment at the local level.The Howard government is committed to an environmental policy which is based on community action, on empowering communities and on strategic investments. All we saw from the Labor Party at the last election was a policy to attack and criticise these groups, these programs, and to put these programs back in the hands of central bureaucracy. The Labor Party still takes its marching orders from Trades Hall, making it totally out of step with the aspirations of the Australian people.ZD4Howard, John, MPMr Howard—Mr Speaker, I ask that further questions be placed on the Notice Paper.Personal Explanations384415:30:003844Mrs DRAPER,MPMrs DRAPER0L6MakinLP10—Mr Speaker, I wish to make a personal explanation.10000SPEAKER, TheThe SPEAKER—Does the honourable member claim to have been misrepresented?0L6Mrs DRAPER,MPMrs DRAPER—Yes, I do.10000SPEAKER, TheThe SPEAKER—The member for Makin may proceed.0L6Mrs DRAPER,MPMrs DRAPER—During last night's Channel 9 news bulletin, Mr Laurie Oakes attributed comments to me which he said that I had made in yesterday's joint party meeting. I categorically deny making those comments. I have telephoned Mr Oakes and advised him of the falsity of his report. Unfortunately, the same claim has been printed in this morning's edition of the Advertiser in Adelaide. Mr Laurie Oakes has since apologised and Mr Phillip Coorey has said that he will undertake to print a retraction of the comments attributed to me. 10000SPEAKER, TheThe SPEAKER—The member for Makin has indicated where she has been misrepresented.15:31:003845Mr CREAN,MPMr CREANDT4HothamALPLeader of the Opposition00—Mr Speaker, I wish to make a personal explanation.10000SPEAKER, TheThe SPEAKER—Does the Leader of the Opposition claim to have been misrepresented?DT4Mr CREAN,MPMr CREAN—I do, by the Treasurer.10000SPEAKER, TheThe SPEAKER—The Leader of the Opposition may proceed.DT4Mr CREAN,MPMr CREAN—The Treasurer indicated in answer to one of the questions to him today that I had voted for an increase in the copayment. When the copayment was introduced by Labor, we increased the payment to pensioners, more than fully compensating them for the increases by the rise in the pension. Why doesn't the Treasurer tell the truth?10000SPEAKER, TheThe SPEAKER—The Leader of the Opposition will resume his seat.Honourable members interjecting—10000SPEAKER, TheThe SPEAKER—It would be very convenient for the chair to issue a general warning, which makes it very easy to exercise discipline at all times. It would also rapidly empty the chamber.CT4Costello, Peter, MPMr Costello—On a point of order, Mr Speaker: that is not a personal explanation. It is far from showing a misrepresentation.10000SPEAKER, TheThe SPEAKER—The Treasurer will resume his seat.Questions to the Speaker3845384515:33:003845Latham, Mark, MPMr LATHAMK26WerriwaALP00—My question relates to an earlier parliamentary debate this day, when the member for Solomon used in the House the letter P in what was a clear reference to a four-letter word ending in `iss'. Mr Speaker, you were in the chair at the time. Far from expunging this word from the parliamentary record, you did not even rule it out of order. Does this denote a change in policy with regard to offensive letters used in the House?10000SPEAKER, TheThe SPEAKER—The member for Werriwa will resume his seat.Personal Explanations384515:34:003845Mr ANDREWS,MPMr ANDREWSHK5MenziesLPMinister for Ageing10—Mr Speaker, I wish to make a personal explanation.10000SPEAKER, TheThe SPEAKER—Does the Minister for Ageing claim to have been misrepresented?HK5Mr ANDREWS,MPMr ANDREWS—I do.10000SPEAKER, TheThe SPEAKER—The minister may proceed.HK5Mr ANDREWS,MPMr ANDREWS—Last night in the adjournment debate the member for Grayndler alleged that I had made certain comments at a meeting in Melbourne recently. I did not make the comments. Moreover, I obtained a copy of the publication which the member was quoting from, and it is quite clear on the face of it that this was an article written by another person and that they were those comments. The member for Grayndler has been caught red-handed.R36Albanese, Anthony, MPMr Albanese—Mr Speaker, if it assists, I will again seek leave to table the document which we based the adjournment speech on last night. The minister was notified that the speech was being given.Leave not granted.Questions to the Speaker3845384515:35:003845Latham, Mark, MPMr LATHAMK26WerriwaALP00—Can I have an answer to the question that I raised earlier on, which is a serious matter?10000SPEAKER, TheThe SPEAKER—Not only will the member for Werriwa not get an answer; if he does not resume his seat, I will deal with him. The question is entirely frivolous and without base, and I do not intend to deal with it in any way at all.K26Latham, Mark, MPMr Latham—I am very p'd off.10000SPEAKER, TheThe SPEAKER—Member for Werriwa!JH5George, Jennie, MPMs George—Ps are okay, but not Cs.10000SPEAKER, TheThe SPEAKER—Member for Throsby!Documents3845Mr ABBOTT (Warringah—Leader of the House) (3.35 p.m.)—Papers are tabled as listed in the schedule circulated to honourable members. Details of the papers will be recorded in the Votes and Proceedings.Matters of Public Importance3846384610000SPEAKER, TheThe SPEAKER—I have received a letter from the honourable member for Hotham proposing that a definite matter of public importance be submitted to the House for discussion, namely:The Howard Government's divisive and unfair Budget.I call upon those members who approve of the proposed discussion to rise in their places.More than the number of members required by the standing orders having risen in their places—15:36:003846Crean, Simon, MPMr CREANDT4HothamALPLeader of the Opposition00—This is a matter of public importance about the budget and the Treasurer is not in the House to take it. The Treasurer can dish it out, but he cannot take it. That is why he is not here to debate this very important issue. He has left it to his numbers man, Joe Hockey. The man who could not even see the HIH collapse coming has been left in charge of trying to get the Treasurer into the Lodge!We used today's question time to take the argument up to the Treasurer. We are sick of his misrepresentation, deceit and blackmail in relation to his unfair and divisive budget. We took the issues up to him and challenged him at every point and demonstrated the falsity of his argument. And yet he is not in the House today to defend his position and he would not answer the questions when they were put to him time and time again. I will come to that, but I want this parliament to understand that we have a Treasurer who is part-time; a Treasurer who thinks he is coasting to the Lodge and thinks all he has to do is one performance per day in question time and that is it. That is not good enough for the Australian public. They want to know why he is slugging them with a 30 per cent increase in the price of pharmaceuticals, why he is forcing through measures that will see cuts in benefits to people who are our most seriously disabled in the community and why he persists with measures that favour only the wealthy in the community and not the vast majority of the Australian people. This is a government that is racked by indecision and by division, a government that attempts to govern by putting Australians against each other. It has lost control of the national agenda and it has lost control in its own party room. It cannot get its unfair budget through the parliament and it cannot even get antiterrorism legislation through its own party room—it cannot get the facts straight over why it needs to excise Australian territory to counter a non-existent boat of asylum seekers. It is divided over the ratification of the International Criminal Court. If this does not succeed, the foreign minister has to resign—it is as simple as that. He is the person that has been out there arguing for this for the past four years and he is being rolled by his backbench. We will wait and see what the outcome is but, if the ratification does not proceed, there is no honourable way out other than for this foreign minister to resign. The government is also breaking its commitment not to raise university fees—a measure that will see $100,000 fees being charged to people who simply want to get an education. We now know that the Minister for Employment and Workplace Relations is actively undermining cabinet's decision in relation to in-vitro fertilisation. If that is not enough, we have reports of a senior senator jumping ship and heading to Ireland as ambassador just months after being re-elected for another six-year term. How contemptuous is that of the Australian public—to go to the electorate and say, `I want to represent you in the parliament for another six years,' and, before the term even commences, to get a cushy little post in Ireland!This is a government divided, a government of hubris and a government that is not acting in the interests of Australians. How have we come to this position? The answer is simple: to win the last election, the government pandered to a far Right, Hansonite agenda and it made spending promises that it could not keep. The conservative forces that the government unleashed then are now starting to tear it apart. The political tactic of dividing the nation and taking us to the Right is dividing the government itself.The people are saying, `No!' to the unfair cuts needed to pay for the election win, and we will support them in that regard. We had in the gallery today representatives of disability groups. The Prime Minister promised before the election that disabled people would not have their benefits cut, and he repeated that promise yesterday in the parliament. But now he is proposing, by the policy measures that they have got in place, to force up to 200,000 people off disability support pensions and onto Newstart. The consequence of that is that they will receive $52 a fortnight less—their benefits will be less! It is a clear breach of a promise by the Prime Minister. He cannot play around with the words. He said no-one would take a reduction in benefits. What about the $52 a fortnight cut for people who are our most seriously disabled and who need the additional assistance because of the circumstances that they find themselves in? This Prime Minister is going to break a promise and force a cut of $52 a fortnight to their benefits. He is also raising the costs of medicines by 30 per cent, even though it was never mentioned during the election.We just had the Treasurer telling us about the mandate they have to do these things. I ask the Minister for Small Business and Tourism, who is at the table: where is your mandate to increase the cost of pharmaceuticals by 30 per cent? The fact is that the government's health policy presented to the Australian people at the last election contains no reference to the Pharmaceutical Benefits Scheme whatsoever. In particular, it has no reference to the long-term viability of the scheme or to increasing copayments. It was never mentioned in the last parliament and it was never mentioned in the election campaign that the government was going to increase the charges, yet the Treasurer blatantly says in this House he has a mandate to do it. No wonder he did not table the election policy on pharmaceutical benefits: there wasn't one. There was never anything in writing. I challenge the minister at the table to table it. Table what you say is the basis upon which this mandate is being developed.We also heard the Treasurer today swear black and blue that yesterday he did not threaten that, if the pharmaceutical benefit measures failed, he would not list certain drugs. He was confronted with the precise quote from yesterday's Hansard. Yesterday he said that, if the government's measures did not succeed, governments: ... will be forced to take a much tougher attitude on the listings of new pharmaceutical benefits.That is outright blackmail. This is a Treasurer sent in to negotiate a package; he is incapable of negotiation, so he resorts to blackmail—and he is not in the House to defend himself.The call that the Treasurer makes is that we need to do this; otherwise the budget is in difficulty. What I am going to say today is that there is a way out of this mess: Labor will facilitate passage of a fairer budget—not a budget of broken promises but a budget that achieves the same bottom line. The government budget measures are unfair and we will not support them. I have said that I want the Labor Party to be known not just for what we oppose but for what we propose by way of an alternative. We will oppose the government's unfair measures but we will do it without hurting the budget, and today I will show how. Five weeks ago, I proposed savings under the Pharmaceutical Benefits Scheme that do not increase the price of medicines to families, through measures such as an increased focus on the cost and prescribing patterns of new drugs in their first year on the PBS, the inclusion of the full cost of the medicine on the label so that consumers are aware of the cost, tighter controls on direct-to-consumer advertising and greater scrutiny of industry marketing. DK6Hockey, Joe, MPMr Hockey—How is that going to help?10000Causley, Ian (The DEPUTY SPEAKER)The DEPUTY SPEAKER (Hon. I.R. Causley)—Minister, you will have an opportunity later.DT4Crean, Simon, MPMr CREAN—If the shrill minister would just listen and take these issues on board instead of being overexcited from his long lunches that he constantly has, we might actually get a bit of progress in this place. The reason I mention these is that the government have announced in the budget some tightening measures in relation to access to the PBS, measures which they claim will yield $800 million over four years. It shows that there are significant savings to be obtained through tightening measures. If in fact the government are prepared to take those measures, why not others? In particular, why not take up Labor's challenge to have those measures costed and release the details? I put that challenge to you five weeks ago, and we have seen nothing. What have you got to hide? I challenge you, Minister, to release those costings today.DK6Hockey, Joe, MPMr Hockey—It is a magic pudding. It is your magic pudding.DT4Crean, Simon, MPMr CREAN—It is a magic pudding, is it? This is a minister who wants you to believe that certain measures that they are going to introduce to tighten the scheme will yield $800 million over four years but that additional measures proposed by us will yield nothing. Minister, get real; but, most importantly, get the costings and release them. Release them—that is my challenge to you today.In relation to superannuation, I also challenge the Treasurer to get the measures costed and bring the figures back. Where are they? I made the same challenge to the Treasurer in relation to the alternative approach to superannuation: instead of giving a tax cut to the top three per cent of income earners, why not give a more modest tax cut to all people in superannuation—all wage earners? That is the proposition that we have here. Labor are the only party in this country that have introduced superannuation for the whole of the work force and we are the only party that will introduce measures that benefit the whole of the work force. Your government wants a measure that yields something only to the top three per cent of income earners, and I put forward proposals whereby a more modest tax cut to everyone—but of benefit to everyone—could still be funded in accordance with the budget. The Treasurer sought to discredit those figures, but we now know from evidence at a Senate estimates committee that he gave wrong advice to the Treasury to cost our measures. He was deceitful again, Minister. We also know from Senate estimates that the Treasury has now given him the true costings of our real proposal, but he has not released them. I wonder why. I believe it is because the Treasury will confirm that our costings of that measure are correct.In relation to the disability support pension, our proposition was quite simple: there is nothing of benefit to next year's budget from the measures being introduced; the so-called benefits accrue in outer years, so we have time to get improvements and changes to disability support pensions together. My challenge to the government then was: withdraw the bill—which they have done, so we have made the first step—and sit down with Labor and work through creative approaches by which we can prepare people—train them—and case manage them so that the transition from disability support pension to work can be made. That is the proposal that we are putting forward in the spirit of addressing these issues. It is fairer, it meets real need and we do it without affecting the budget bottom line.Since the budget, the government has also introduced in parliament a tax exemption for foreign executives working in Australia. How lopsided is your thinking? This tax break will cost the budget $50 million a year or $200 million over the next four years, or more than half the total savings from the changes to the disability support pension. How can giving a tax cut to wealthy foreign businessmen be a higher priority than helping the neediest Australians? How can that be right?DK6Hockey, Joe, MPMr Hockey—The old class warfare.DT4Crean, Simon, MPMr CREAN—The minister calls this class warfare. I invite the gallery to make the choice: how is it fairer to give a tax cut to wealthy foreign businessmen as a higher priority than helping the neediest Australians? This is a government that has been unfair to the Australian public. It deceived in relation to what it said it was going to do; it is now trying to blackmail them. Instead of blackmailing the Australian public, sit down and adopt Labor's approach—a fairer approach, an approach— (Time expired)15:52:003849Hockey, Joe, MPMr HOCKEYDK6North SydneyLPMinister for Small Business and Tourism10—You only needed to note how various members of the backbench of the Labor Party fell asleep during the Leader of the Opposition's speech to understand how the speech failed to penetrate the interests or the observations of the House, let alone the interests or the observations of the members of the parliamentary Labor Party. Leadership is forged out of difficult circumstances, not out of easy circumstances. A leader is born out of moments of courage and honesty, not out of moments of opportunism and the pragmatic manipulation of what is perceived to be public interest rather than what actually is public interest. In this situation the current Leader of the Opposition has failed the test. We have just heard that the Leader of the Opposition has the pharmaceutical product that will cure all the ills of the Commonwealth budget! That wonderful drug known as opportunism is available to everyone who wants to take it, courtesy of the Leader of the Opposition. Why do I say that? I say that because we judge the Labor Party as the people of Australia judge the Labor Party: not on what they say but on what they do. This is a salient lesson for those members of the Labor Party remaining in the House: you are judged not on what you say but on what you do. That is why today the coalition are in government. We were judged on interest rates and today Australians enjoy amongst the lowest interest rates in 30 years. The Labor Party were the party responsible for interest rates of up to 22 per cent for Australia's 1.2 million small businesses. Australia's small businesspeople and all those people who wanted to own their own homes will never forgive the Labor Party for that. The Labor Party will also be judged on its budget performance. When the coalition came into government, we faced a $10,000 million deficit courtesy of the Labor Party. The architect of that $10,000 million deficit was judged at the last election. The member for Brand now sits on the back bench waiting for the wonderful day when he will be called back to the front bench. That $10,000 million deficit was something that we had to repair when we came to government and over the last six years the coalition in government have run cumulative surpluses of $19.3 billion. In addition, we have repaid $61 billion of the Labor Party's debt.The Labor Party were the great creators of Australian government debt. When they came into government in 1983, Australia had something like $10 billion of debt accrued over 82 years, but from 1983 to 1996 the Labor Party racked up $80 billion of debt. (Quorum formed) Given their call for a quorum, the Labor Party are obviously a little sensitive about this. The Labor Party will not be allowed to forget the great quote from Don Watson's book when he described the insults used in Paul Keating's office. He said:Mickey Mouse was a name to be feared by all advisers in the Keating office. To be touched by those two words was poison. Bleeding heart, froth, fairy floss and Creanites were others. A Creanite was someone who sympathised with industry policy of the kind advocated by Simon Crean. These names were dreaded in the way that Trotskyist and revisionists were dreaded in another time and another place. You knew your economic credibility was shot when you were described as a Creanite.I ask myself: what would a Creanite be described as? And I think of it in the context of Who Wants to be a Millionaire. The million dollar question is: what is a Creanite? You have four choices: (a) a dysfunctional, dummy-chewing case study appearing on stage in the final 10 minutes of a Jerry Springer episode; (b) an alien intruder that looks a lot like the Hydra but is wiped out by a robot from Lost in Space; (c) an accomplished spelunker; and (d) a member of the parliamentary Labor Party who is prepared to compromise national interests for cheapjack political opportunism. So the question is asked: which one are you prepared to lock in? We will have to go to the telephones and ring a friend. If Simon were ringing a friend, he would be pretty lonely.10000Causley, Ian (The DEPUTY SPEAKER)The DEPUTY SPEAKER (Hon. I.R. Causley)—Order! The minister will refer to members by their seats.DK6Hockey, Joe, MPMr HOCKEY—So you would ring up a friend and ask, `Is a Creanite a dysfunctional, dummy-chewing person on Jerry Springer?' Well, even though the frontbench of the Labor Party look like the line-up in the final 10 minutes of a Jerry Springer episode, you would say, `In fact, no, (a) does not apply: we will wipe out (a).'7T4Crosio, Janice, MPMrs Crosio—Why don't you defend your budget?10000DEPUTY SPEAKER, TheThe DEPUTY SPEAKER—The member for Prospect has already been warned today.DK6Hockey, Joe, MPMr HOCKEY—Then there is option (b): is it an alien intruder that is killed off by robots coming back from Lost in Space? You would have to say that a Creanite is not that, either, and so you would have to wipe out (b). So you go fifty-fifty before you lock in. What about (c)? Is a Creanite an accomplished spelunker?7T4Crosio, Janice, MPMrs Crosio—I rise on a point of order, Mr Deputy Speaker. The MPI was very obvious: the Howard government's divisive and unfair budget—one line. If the minister at the table cannot defend the budget, I would suggest you bring him back to what the MPI is all about.10000DEPUTY SPEAKER, TheThe DEPUTY SPEAKER—The member for Prospect will resume her seat. The words have very wide reference, and I am sure the minister is able to refer back to them.DK6Hockey, Joe, MPMr HOCKEY—Mr Deputy Speaker, it would not be fifty-fifty; it would be sixty-forty: they would want to hedge their bets. So they will lock in (c), `accomplished spelunker', and think, `A spelunker is a cave person walking through the caves. Yeah, that seems to fit the Labor Party: always kept in the dark, relying on ropes provided by others.' But at the end of the day you would have to come down to (d). At the end of the day, a Creanite is someone who is prepared to compromise the national interest in an attempt to obtain the cheapjack political opportunism that is available to a leader of the opposition.How disappointing it is that when someone is asked to display leadership they cower. For the past three years at MPI after MPI—I have been in this House going through every MPI on the new tax system during the time the Leader of the Opposition was shadow Treasurer—the shadow Treasurer, the member for Hotham, would come into this place and say, `Australians will be worse off under the new tax system.' He said that the new tax system, the GST, is Armageddon for the everyday Australian. That is what the now Leader of the Opposition said for three years. For three years Labor talked about roll-back—the roll-back that they never could deliver, the policy that they never could define. When they had a chance to put their policy before the people of Australia at the election last year, the people of Australia said, `We want true leadership. We want true courage. We want people to make decisions in the national interest. We are not interested in political opportunism.'When the first opportunity came along for the member for Hotham to display real leadership—not pretend leadership but real leadership—and to say that it is in the national interest to do something about the PBS and disability support pensions, to reform the superannuation arrangements for some affected Australians and to run a responsible surplus budget, you would think that he might, for one single moment and so early in his leadership term, have said that he would put the national interest ahead of his own. The simple reason the Leader of the Opposition is engaging in this sort of populist rhetoric is that he feels threatened about his leadership. He feels threatened by the reaction that he received in Queensland at the Labor Party State Council where he was booed and heckled by his own people—the people who know him. If the people who have known the Leader of the Opposition for years are booing and heckling him, what are the people of Australia going to do at the next election when they start to get to know him? There is only one person more unpopular in Queensland than Bill Harrigan, and that is Simon Crean. 10000DEPUTY SPEAKER, TheThe DEPUTY SPEAKER—The minister will refer to members by their seats.DK6Hockey, Joe, MPMr HOCKEY—It is not only in Queensland but in New South Wales: he was belted up under the steps of Sydney's Town Hall by the Labor Party when he wanted to talk about reform of the Labor Party. He is so burnt by those experiences. In New South Wales and Victoria there is a complete meltdown for the Labor Party. In Queensland he was booed. Even on his own benches people are starting to murmur—the murmur that starts before a leadership challenge comes along. You know what? It has started. And they are talking about the member for Brand—that is how desperate they are.00AN4Tollner, David, MPMr Tollner—Plugger!DK6Hockey, Joe, MPMr HOCKEY—They are going back to the future, bringing Plugger back. It has not helped the Swans and it is not going to help the Labor Party. You would have to believe that there is a chance for the Labor Party to show some leadership during difficult times. When we had to do the hard yards to help keep interest rates low, we did them. When we had to do the hard yards to get inflation down, we did them. When we had to do the hard yards to get the budget back into surplus, we did them. When we had to do the hard yards on the reform of the industrial relations system, we did them. When we had to do the hard yards in relation to taxation reform, we did them. The Labor Party have not done the hard yards and they certainly do not have a leader who knows how to do the hard yards.WU5O'Connor, Gavan, MPMr Gavan O'Connor—What about the bottom of the harbour?10000DEPUTY SPEAKER, TheThe DEPUTY SPEAKER—Member for Corio!WU5O'Connor, Gavan, MPMr Gavan O'Connor—You are the friend of the tax bludgers.10000DEPUTY SPEAKER, TheThe DEPUTY SPEAKER—The member for Corio might not be here very long, from the way he is carrying on.16:06:003851Ellis, Annette, MPMs ELLIS5K6CanberraALP00—Oh, what a sorry state we have when an abuse upon the disability sector in this country is cloaked in the language of national interest! I am absolutely stunned to see a divisive and unfair budget like this, attacking the most vulnerable in our community, cloaked in some flag of national interest. It brings back to me pictures of other people cloaking themselves in the flag, and indeed it is not a very pretty picture.This government starts off its introduction of its so-called reforms in the welfare system with language suggesting fraud, misuse, rort and rorters when talking about changes to the disability support pension. What this government has proposed in changes to the DSP is so outrageous as to be, in my opinion, unbelievable. It is all being done under the banner of welfare reform via McClure. Some people have been saying to me, `Do you really think the government knew what it was doing when it came up with these proposals?' As hard as it may seem to say, that is a very difficult question to answer. One would think that governments realise the potential impact of their decisions, especially big ones like this. If that is the case, it presents a pretty frightening scenario—and in this case it did in fact know what it was doing. Of course, when you couple the DSP program with the government's views on how to reform the PBS, you have some real problems to face if you are out there attempting to deal with it.I would like to refer to a couple of major concerns that I have, particularly in relation to the DSP. The first thing I want to talk about, which is something that has been topical here today, is what is commonly called the SACS award. This is an award that was granted through the New South Wales industrial courts last November. People working in the community sector, in particular people amongst the lowest paid in the community sector, got a very minor and meek award wage increase. On the WIN Sunday program on 1 June, Minister Vanstone said in relation to this issue:New South Wales is trying to stir up the sector.The Prime Minister said:We set aside an amount for wage increases. The SACS Award exceeded that. That is a problem for New South Wales.That is a logic that I cannot quite grapple with. The reality is that the responsibility for the Commonwealth proportion of that award is a responsibility for the Commonwealth. The New South Wales Industrial Relations Commission, as I said, granted this award. The state government has agreed to pay its $116 million share over three years. The Commonwealth has refused to commit to its $68.8 million share of this salary increase. I believe that to be about 37 per cent in total of the funds required for this salary increase. This pay increase means that most of those workers go from the grand sum of $12.60 to the enormous sum of $13.80 an hour by the end of this year. Yet this government says it is not responsible.I want to refer quickly to a publicly available letter sent on 26 April to the Prime Minister from Premier Bob Carr. It was also signed by seven or eight other people, including Patrick McClure—a very interesting name when we talk about welfare reform—the head of Uniting Care, the head of St Vincent de Paul in New South Wales, the executive director of ACROD in New South Wales and a whole range of other people. They wrote to the Prime Minister imploring that the Commonwealth pay its proportion of the SACS award. And still we hear nothing—although I think today there might have been some words to the effect of `I'm getting a paper with options'. Why ask for a paper with options now, in June, post-budget, when that award came down last November and people have been telling this government ever since about the troubles they would be facing should that money not come through? The changes proposed by this government to the DSP are not only unacceptable but also come with the threat of blackmail by Minister Vanstone and her government. The funding for the CSTDA—the Commonwealth State Territory Disability Agreement—will be withheld by this government if we do not pass through the parliament those draconian changes. The MS Society of Victoria called this `Vanstone's human shield', which I think is a good description, and went on to say:This is a disturbing political development. Disability Services has always had bipartisan support, but we are seeing unprecedented politicisation of essential services.The Paraplegic and Quadriplegic Association of Queensland says to the federal coalition:Your Budget tactics are political blackmailThe Howard Government is playing with people's lives.To every single member of the Federal Coalition we say:How dare you let your Party treat people with a disability with such contempt!The Melbourne Citymission, in their response to the budget and in relation to the proposed new work activity test which will apply should those terrible proposals for DSP go through, said:A pattern emerges in the shift of focus to problematising the individual and their disability as the reason for their unemployment, whether because of insufficient training or insufficient motivation and concentrating efforts at this personal level rather than recognising true levels of unemployment and barriers faced by people with a disability.Over the last few days and again in question time today, the Prime Minister denied that he had misled the community when he said that benefits would not be cut. This is simply mean and tricky—words that keep coming back to haunt the government. You do not have to cut the level of benefit to hurt people; you simply cut their income by moving them from one benefit to another, which happens to be a benefit $52 per fortnight lower than the one they are on—and that is before we even talk about health care cards, tax concessions when you earn additional money and all those sorts of things. The $52 is in fact the minimum cut. Semantic arguments on the part of the Prime Minister are pretty pathetic. Talking about terminology, let us look at what Minister Vanstone said recently. We are hearing a new interpretation being put on disability. What is it according to her? On the Insiders program last Sunday morning, when talking about the new process that the government want to implement, Senator Vanstone said:... the existing population will be reviewed in the normal process over the next five years and if they're assessed as being able to work 15 or more hours at award rates, then we'd like to say to them, “Look, you have to be treated like a more able-bodied person,” and keep the disability pension—which is generous with a lot of benefits and I'm pleased with that—keep them and the extra spending for people with high-support needs, not for the least disabled.What does `the least disabled' actually mean? Are we getting into an interpretation of someone being `really disabled', `least disabled', `half pregnant' or `fully pregnant'? I am not quite sure where the government believes that we ought to go when look-ing at interpretations of people in need.The point is really quite simple. Out of all those people with differing abilities and disabilities, who will decide who is in fact the least disabled? For instance, will the young man in my electorate who came to see me with his father a couple of weeks ago be considered one of the least disabled? He very well might. He receives a partial disability pension and he works more than 15 hours a week for award wages. He has an intellectual disability. He has worked on award wages since he completed year 12 at a special school. He works at KFC and at a local club. He cannot drive a car; he depends on public transport. He and his father gave me a letter, which said:We understand that because he works more than 15 hours for award wages, he may be taken off DSP and put into the Newstart arrangements, including mutual obligation requirements, activity testing and the potential to be breached.This family find this unacceptable, and so do I and so does everybody on this side of the House and so do most people out there in the community.This government stands for forcing people off the DSP on to the open labour market, cutting their income, holding the community and those in the disability sector to ransom, and threatening to refuse funding through the CSTDA until its measures are through. We now also know that in many cases people facing that work activity test may very well come from the sheltered workshop or business service sector as well. It is absolutely outrageous. It also stands for not paying its part of the SACS award in New South Wales, and we now have services being cut or closed as a result of that. Welfare reform can in fact be achieved, but it does not have to include hardship, coercion, reduction in income support et cetera. It can be achieved by positive measures. (Time expired)16:16:003853Ley, Sussan, MPMs LEY00AMNFarrerLP10—I am pleased today in my first contribution to a matter of public importance in this House to be speaking in support of this government's budget. Members in my electorate of Farrer are satisfied with the budget, and they have every reason to be. We have an economy that continues to outperform all others. At a growth rate of four per cent, it is growing at the fastest rate in the industrial world. Yes, there is a narrow deficit this year, but there will be a narrow surplus next year.Interestingly, the praise we have for the budget comes from all sources. Let me relay a few of these to the House. The Australian Chamber of Commerce and Industry says, `It really is a document for the long term.' It recognises that this budget is different from earlier ones; it looks to the future. The Australian Industry Group says, `The government has managed to deliver on its election promises.' Australian Business Ltd says, `It maintains a strong defence for low interest rates and continued growth.' The Business Council of Australia says, `We have stronger than expected economic growth.' Access Economics says, `It is eminently sensible, eminently reasonable.' In recognition of the previous speaker, the Minister for Small Business and Tourism, the Tourism Task Force says, `A thumbs up for the budget from the tourism industry.' The electors of Farrer and of elsewhere, particularly small businesses and farmers, are delighted with the low interest rate environment in which they are operating. They are pleased with interest rates of 4.75 per cent, even after two interest rate rises, and with housing mortgage interest rates that are still the lowest in 30 years. They appreciate lower interest rates and lower taxes. They know they are lower than they would be under Labor and they know they have less interference in their lives than they would have under Labor. For my electors of Farrer, these positive features of their operating environment are just as important as rail, road and transport infrastructure.I can remember when as a young woman starting out in my married life on my husband's fourth-generation family farm interest rates were 13 per cent, and we thought that we could just manage with that. Then they jumped to 14 per cent, 15 per cent, 16 per cent, 17 per cent and 18 per cent, by which time we were in real financial trouble. As a young mother with three children under five, I went back to study and work so that we could put food on the table. I was unable to fulfil, or at least to complete, the member for Parramatta's dream of mothers at home. So I have a real fear of high interest rates, because I have experienced what they can do to me, my family and my business. I can remember how we nearly lost all those things.I have a real fear of high government spending, which leads to high government borrowing and higher interest rates. This Labor Party, by accusing us of running a divisive and unfair budget, would have us maintain and even increase government spending. They have indicated this by their statements that they will reject, amongst others, the PBS measures, the disability support pension measures, the superannuation surcharge measures and choice for superannuation measures. All of this will ratchet up government spending.The Labor Party has the luxury of bearing no risk and accepting no responsibility. We in the government are forced to bear the risk, to suffer the consequences and to accept the responsibility, because we cannot stand by and allow our fiscal position to deteriorate. And that is why we are taking this action with the PBS. We are not just cutting government spending to fund other initiatives, as the Labor Party and some sections of the media would have us believe. We are ensuring the sustainability of the scheme. What would the Labor Party have us do? New age wonder drugs are being developed all the time. Biotechnology and research into the human genome are leading to the development of a new generation of pharmaceuticals. They will be extremely expensive. No-one should be denied access to these drugs. For example, drugs to control ovarian cancer will cost $2,488 a script and medication to control prostate cancer will cost $1,214 a script. How does the Labor Party propose to keep these medications affordable for the ordinary men and women in my electorate?Let us look at disability measures. Since 1990 the number of people receiving the disability support pension has more than doubled. One in nine Australians aged between 50 and 64 presently receives the disability support pension. Our budget aims to improve the work capacity of people with disabilities by providing over 73,000 new places, over three years, in disability employment services, rehabilitation services, Job Network and education and training. Like our other measures, this is forward thinking. This is what was recognised by the Australian Chamber of Commerce and Industry when they said this really is a document for the long term. But in question time today the Prime Minister said he does not intend to see important services to disabled Australians and those who may be impacted on by the budget measures affected adversely, that we will work carefully through the submissions received from groups advocating the rights of disabled Australians and that we will respond sympathetically. The previous speaker recounted a letter that has been written to her about somebody who feels that their disability support pension may be replaced by some element of another benefit. I am sure that this case will be considered and responded to sympathetically. The Labor Party should not tell us we are being divisive and unfair. It is actually the ALP that is being divisive and unfair by not allowing this government to enact the legislation for which it was elected.Interestingly, I have heard two speakers in this debate on the matter of public importance that deals with the supposedly divisive and unfair budget we are facing. I could be wrong, but I have heard no mention of rural and regional issues. Has the ALP considered the benefits of the budget for the people of regional Australia, such as those in the seat of Farrer whom I represent? We do not consider the budget to be divisive and unfair. Rather, we would say it is inclusive and equitable, because it recognises the rights of those in the regions to participate fully in the opportunities and services that Australia offers. Where is country Labor now? Let me give you some examples of how this budget looks after regional Australia and the electors that I represent: $1.7 billion for the nation's roads, $102.4 million over five years to develop and implement the National Food Industry Strategy, $72.7 million over four years for radiation oncology initiatives in regional Australia, $13 million over three years to improve TV reception in regional areas, ongoing support for regional airlines—consider the excellent work our Minister for Transport and Regional Services has done in assisting to get Kendell Airlines, a local airline in my area, back in the air—and $25 million over five years for incentives for environmental management in the form of $3,000 cash back to farmers who carry out sensible environmental practices. That $3,000 could have been very useful to me in those early years on my family farm; it is worth remembering that the land-holder who is most likely to damage the environment most is the one going broke. As a member in this House representing rural and regional Australia, I can assure you that rural and regional Australia do not feel this budget is divisive and unfair. We are quite happy with the leadership of John Howard and John Anderson. We did not fall for the lie that was country Labor. I might say that those of us on the land and waiting for rain, staring drought in the face, and those of us in small business—mums and dads—do not appreciate the negativity and the carping nature of this opposition. Life for us is about getting on with the job, coping with the challenges, understanding that you have to make tough choices and that we as a government have to make tough choices. Let me say to the opposition: you do yourself no favours in rural Australia with your attitude to this government's budget.10000Jenkins, Harry (The DEPUTY SPEAKER)The DEPUTY SPEAKER (Mr Jenkins)—Order! The discussion is now concluded.Committees38553855385516:27:003855Charles, Bob, MPMr CHARLESOT4La TrobeLP10—On behalf of the Joint Committee of Public Accounts and Audit, I present the following report entitled Report 388—Review of the accrual budget documentation.Ordered that the report be printed.OT4Charles, Bob, MPMr CHARLES—by leave—Since 1999-2000 the Commonwealth's budget documentation has been on an accrual based outcomes and outputs framework. This is designed to allow parliamentarians and the public to see the real cost of delivering benefits to the Australian community—referred to as outcomes—and agency goods and services—referred to as outputs. The real cost includes indirect costs such as corporate overheads, depreciation and maintenance, and the opportunity cost of capital.The review was begun by the committee in the previous parliament and completed in the present parliament. The committee has taken a broad view of the budget documentation and reviewed the budget papers, associated portfolio budget statements, the portfolio additional estimates statements, agency annual reports and the documents which report the final outcome for the financial year. The report focuses on the structure of the outcomes and outputs framework, the continuity of financial and performance information, the level of detail in the PBSs, the appropriateness of performance information and various accounting issues. The committee examined the links between various components of the framework in a sample of agencies. The committee acknowledges that with any new system there will be a period of adjustment. However, while the committee is satisfied that agencies have to date endeavoured to achieve consistency, there is still room for improvement.One area which needs work is that of cross-portfolio information. The committee believes that some agency outcomes are so broad and far reaching as to be in effect outcomes shared with other agencies. These shared outcomes should be identified. The committee has recommended that agencies with shared outcomes should determine a lead agency with prime responsibility for the outcome. However, all involved agencies should identify and report on their contribution to the outcome in their PBS and annual report. The committee encourages the use of memorandums of understanding between agencies to clarify responsibilities.The committee has considered two aspects of continuity: the provision of timely information and the year by year continuity of information. Timeliness of information can be enhanced by the provision of earlier annual reports, and the committee has recommended that the tabling of agency annual reports be brought forward by one month to the end of the first quarter of the subsequent financial year. Where outputs span across several years of funding, consistency is particularly important. Unfortunately, when changes occur, sometimes only a simple statement that there has been a change appears in the documentation. This is insufficient and unacceptable. Agencies need to explain what the change is and how stakeholders can compare the previous format to the current format. There also needs to be an explanation of the underlying reasons for the change and the implications for the funding of agency programs.Some agency outcome statements do not provide enough detail because they are too highly aggregated to describe agency objectives in a meaningful way. This prevents parliament adequately assessing proposed resource allocation and agency performance. This is particularly the case with Defence, which has a single broad-ranging outcome. The committee has recommended that agency outcome statements should provide more detail. Where agencies have a single broad-ranging outcome or a small number of highly aggregated outcomes, intermediate outcomes should be identified.The committee observed that there was a wide variation in the level of disaggregation of departmental outputs provided in portfolio budget statements and annual reports. The committee considers that there would be considerable benefit in agencies providing more disaggregated output information to support transparency and accountability for performance. The committee therefore strongly encourages Finance, in consultation with relevant parliamentary committees, to identify and make available to the parliament, agencies and the public examples of better practice, where agencies have provided appropriately disaggregated outcomes and outputs information in a cost-effective manner. The committee received evidence that, while forward estimates information by outcomes and outputs is not currently included in portfolio budget statements, the information is available and in fact is being provided by one agency in an appendix to its PBS. The committee concludes there would be benefit in all agencies providing such information in their portfolio budget statements.A practical and informative performance information framework is an integral element of the new outcomes and outputs budget framework, as it enables the understanding and monitoring of agency outcomes and outputs. Agency progress in this area is patchy, and indeed the committee noted examples of performance measures which did not provide a target against which performance could be measured. The committee has recommended that agency performance measures in the portfolio budget statements must always be accompanied by a comparative standard. Agency performance against this comparative standard, whether it has been a success or a failure, can be discussed in the agency annual report.The committee is satisfied that the guidance and advice provided to agencies by Finance and the ANAO is at an appropriate level. However, it is important to determine whether this guidance is adopted or has some other positive outcome. The committee therefore considers that Finance and the ANAO should monitor the improvements shown by agencies. Further, the committee recommended that Finance and the ANAO should develop performance measures with targets for the advice they provide.The Charter of Budget Honesty requires the government to publish a final budget outcome report within three months of the end of the financial year. The committee has discovered that the FBO is not audited. The reason given was that auditing the FBO would compromise its timeliness and end of year usefulness. Nevertheless, the committee concluded that the information in the FBO is sufficiently important to warrant an audit to provide additional assurance.Overall, the committee considers that, despite its criticisms, the structure of the accrual budget documentation framework is sound. However, there will need to be continuous refinement, and this may take a number of years. The committee has a keen interest in accountability and transparency of government and will maintain its interest in the accrual budget documentation into the future.In conclusion, I would like to express the committee's appreciation to those people who contributed to the inquiry by preparing submissions and giving evidence at the public hearing. I wish to also thank the members of the two sectional committees involved for their time and dedication in conducting this inquiry. I also thank the secretariat staff: the secretary to the committee, Dr Margot Kerley; the inquiry secretary, Dr John Carter; the research officers, Mr Mark Rogala and Ms Rebecca Perkin; and the administrative officer, Ms Maria Pappas. I commend the report to the House. I seek leave to move a motion in relation to the report.Leave granted.OT4Charles, Bob, MPMr CHARLES—I move:That the House take note of the report.I seek leave to continue my remarks later.Leave granted; debate adjourned.Bills3857R15303857Debate resumed.16:35:003857Slipper, Peter, MPMr SLIPPER0V5FisherLPParliamentary Secretary to the Minister for Finance and Administration10—in reply—The Financial Sector Legislation Amendment Bill (No. 1) 2002 continues the legislative amendments to improve the efficiency and operation of a range of financial sector legislation. This bill contains amendments to nine acts. The majority of the amendments are minor and technical in nature. The bill will not have a financial impact on the operations of the government. However, the amendments will indeed improve the operation and administration of various acts. A number of honourable members spoke—the members for Werriwa, Cunningham, Melbourne and Mitchell—and I want to thank all of those members for the speeches that they made.A number of issues were raised by honourable members, as is common in debates in the chamber. I would like to respond to some of those matters in the time available to me. The member for Werriwa sought certain assurances with respect to the Reserve Bank. (Quorum formed) I was going to invest some of the time in my summing-up speech to give certain assurances and information requested by the honourable member for Werriwa. Given the fact that a quorum was called, I will proceed with the substantive matters in my summing up and then, if there is time left, I will give the information requested by the honourable member for Werriwa. I will also then comment on remarks made in the contributions by other honourable members.The amendments to the Financial Sector Legislation Amendment Bill (No. 1) 2002 aim to improve the efficiency of some of the functions of the Australian Prudential Regulation Authority. For example, amendments to the Financial Institutions Supervisory Levies Collection Act 1998 levy payment date has been clarified, which is to the advantage of APRA and industry. This amendment will resolve some administrative difficulties APRA has under the current legislation and it will also ensure industry has a reasonable period of a minimum of 28 days after the notice is given in which to pay the levy. Amendments to the Financial Sector (Transfers of Business) Act 1999 aim to ensure that complete consultation is achieved in relation to the transfer of business applications by including the Australian tax office as an authority that APRA must consult with. This will result in a more comprehensive consultation process. Amendments to the Superannuation Industry (Supervision) Act 1993 will allow the ATO to disclose information to APRA regarding breaches of the act. This will allow a greater flow of information and will assist APRA in making more informed decisions in performing its role as a regulator. This bill builds on the financial sector reforms already being undertaken and it emphasises the commitment to ongoing improvements which will ensure that Australia is at the forefront of the world's best practice in financial regulation.Returning to matters raised by the honourable member for Werriwa, I am pleased to advise him that the repeal of section 71 of the Reserve Bank Act will not affect the superannuation arrangements of the RBA employees. The repeal of section 71 is aimed at simplifying the act and streamlining the provisions relating to staffing. The repeal will result in a less cumbersome and more efficient process for operating the superannuation fund. The RBA has no intention to change the operation of any of the elements of the RBA superannuation fund and it would not do so without full consultation with the RBA board of trustees. The current board of trustees of the superannuation fund will continue to be required to operate in accordance with superannuation legislation. The assets are managed by professional fund managers. The RBA's superannuation fund board of trustees was consulted on the amendment and I am pleased to assure the honourable member for Werriwa that the amendment was given the full support of the board. The board of trustees comprises representatives appointed by the RBA and representatives elected by staff. Three of the six board members are staff elected and these people are also union representatives.The member for Werriwa also queried whether amendments refining the `fit and proper' requirements for directors and senior managers, general insurers, or authorised non-operating holding companies under the Insurance Act 1973 will also be applied to the Banking Act 1959. The amendments to the Insurance Act 1973 relating to the fit and proper test have been proposed to enable APRA to ensure an insurance industry that is managed by people with the necessary skills, expertise and integrity, as required by their responsibilities. The implementation of this amendment will enable Australia to comply more fully with the Basel committee's core principles of effective banking supervision.Amending the Insurance Act to include a fit and proper test is consistent with the inclusion of a fit and proper test in the Superannuation Industry (Supervision) Act 1993. An amendment to include a fit and proper test in the Banking Act will be brought forward in Financial Sector Legislation Amendment Bill (No. 2) 2002, which is scheduled to be introduced in parliament next week—that is, the week beginning 24 June. The wording of the amendments to the Banking Act is of the same form and intent as the wording to amend the Insurance Act, except to refer to authorised deposit taking institutions or non-operating holding companies in place of a general insurer.The member for Werriwa queried why APRA is prone to criticism by the Australian National Audit Office. I advise the honourable member that the Australian National Audit Office has a requirement to undertake audits of government agencies. APRA's exposure to ANAO audits is an example of the transparency and accountability of government agencies under the Howard government. APRA is working to ensure that it meets all of the requirements of the ANAO.The member for Werriwa also referred to an Australian National Audit Office report from 2001 which criticised APRA's late invoicing of industry. He did this in the context of referring to the cost to taxpayers in lost interest. The changes to the Financial Institutions Supervisory Levies Collection Act will provide industry with a fair and reasonable time frame in which to pay their levy obligation. The current legislation requires payments by 1 July. For some industry players, this has caused difficulty in managing their finances where the invoice has been sent close to 1 July. However, as was the case for levies for 2002-03 where industry was invoiced on 31 May, the intention is for APRA to invoice industry more than 28 days prior to 1 July to ensure that there is no loss of interest revenue. The member for Werriwa seems to be a serial complainer. He asked why the government is only now bringing these amendments forward. Quite simply, the government has sought to make the most efficient use of the time and resources of the parliament by addressing a number of amendments in a single legislative vehicle. I am quite certain that you, Mr Deputy Speaker Jenkins, would understand the reason that procedure has been followed.It is also interesting that the member for Werriwa, in a fairly garbled query, talked about the RBA and the possibility of changed tenancy arrangements. The question was confused, but the Reserve Bank of Australia becoming a landlord demonstrates the intention to ensure that government buildings are not left vacant. It is not the intent of the RBA to become a tenant. The RBA building has been staffed by up to 1,200 employees, but as some functions of the RBA are now being undertaken by other agencies—for example, APRA is now responsible for licensing banks—the office space that the RBA needs is, therefore, much less than it needed previously. It would be wasteful to leave office space idle. The honourable member seemed to assume that the Reserve Bank intended to sell its premises and rent the space back. That, I am advised, is not the case.The member for Melbourne asked why there is a need to remove the 30-day time limit for the minister to make a decision allowing a merger or acquisition to proceed under the Insurance Acquisitions and Takeovers Act 1991. The response is that the 30-day time limit was too short for thorough investigation to take place and for the companies applying for a merger or acquisition to provide the necessary documentation. The amendments will prevent the need to place a temporary restraining order on the transaction which requires gazettal or the company to withdraw its application if the 30-day limit expired before adequate investigations had been finalised. A similar situation exists under the Financial Sector Shareholdings Act 1998. Decisions taken by the government in relation to applications under this act have consistently been timely. The member for Melbourne referred to what he claimed was APRA's breach of Australian accounting standard AAS 15. I want to tell him that APRA's breach of this standard was the result of APRA operating under an accrual accounting treatment. The legislation which the Australian National Audit Office referenced in making their assessment was section 50 of the Australian Prudential Regulation Authority Act, which requires a cash treatment of received moneys. This anomaly will not occur in the future due to the passage of the amendment to section 50 of the APRA Act contained in this bill. This amendment will modernise the act and will align the wording of the act with APRA's accounting treatment.The member for Mitchell referred to APRA's action on HIH. One question that people sometimes ask is: has the royal commission yet identified the main causes of the failure of HIH? It would be inappropriate for the government to comment on any issues which may be the subject of investigation by the royal commission. Honourable members would be aware that the royal commission commenced formal hearings in December last year and will now report in February 2003, to ensure a comprehensive and proper investigation of the circumstances surrounding the collapse.The member for Cunningham referred to public liability. There is no doubt that the issue of public liability insurance and its affordability is a matter of concern to the community. It is certainly a matter of concern to the government. This is one of those instances where governments at all levels in Australia are working very well together. The government remains concerned about the affordability and availability of public liability insurance and, in particular, its impact on small business, community groups and local councils. On 30 May this year, the Assistant Treasurer chaired a second meeting of ministers in Melbourne. As a result of that meeting, the states and territories have announced a range of reforms. Tort law reform is essentially the responsibility of states and territories, but the Commonwealth has been working in cooperation with state and territory governments to develop a nationally consistent solution to the current crisis in public liability insurance. I am particularly pleased that that has been happening and is continuing to occur.The member for Werriwa also spoke about whether the Reserve Bank would have scope to sell its building and what would actually happen. The ALP is the last political party that ought to talk about the renting of premises by government agencies. We have a situation where, in 1993, the Labor government arranged for the lease by the National Audit Office of a Canberra property called Centenary House, which was owned by Labor. The lease was for 15 years, which is considerably longer than the usual Commonwealth lease of around five years, and the ALP claimed a rental increase of nine per cent a year. Last year, the annual rent rose by $403,244 to $4,883,733.50—that is almost $5 million for one year, ripped out of the pockets of ordinary hard-working Australians and stuffed into Labor coffers. Over the life of the contract, taxpayers will have been ripped off to the extent of $36 million; that is the amount above market rates that the taxpayer will have to pay over the 15 years of the lease. So the member for Werriwa ought to desist from talking about government agencies renting property. As I indicated a little while ago, there is no intention for the Reserve Bank to become a tenant.It is common ground that the financial sector is a key driver in the economy. The benefits of these amendments will provide increased efficiency of the financial industry and improved operation of the nine acts. On that basis, I thank honourable members for their support of this legislation and I urge its passage by the chamber.Question agreed to.Bill read a second time.Message from the Governor-General recommending appropriation announced.3860Mr SLIPPER (Fisher—Parliamentary Secretary to the Minister for Finance and Administration) (4.55 p.m.)—by leave—I move:That this bill be now read a third time.Question agreed to.Bill read a third time.Bills3860R15193860Debate resumed from 21 March, on motion by Ms Worth:That this bill be now read a second time.16:55:003860Smith, Stephen, MPMr STEPHEN SMITH5V5PerthALP00—The Therapeutic Goods and Other Legislation Amendment Bill 2002 amends the Therapeutic Goods Act 1989, the Industrial Chemicals (Notification and Assessment) Act 1989, the National Occupational Health and Safety Commission Act 1985, and the Therapeutic Goods Amendment (Medical Devices) Act 2002. In the view of the opposition the amendments are non-controversial and make technical and other necessary changes to legislation. They are supported in this place and will be supported in the Senate.The bill has four schedules. Schedule 1 amends the Therapeutic Goods Act 1989 to clarify the imposition of duties and the conferral of functions and powers on Commonwealth officials and authorities within the Commonwealth-state cooperative scheme for the regulation of therapeutic goods, following the decision of the High Court in R. v. Hughes 2000. The High Court in Hughes considered that a duty had been imposed on the Commonwealth Director of Public Prosecutions to exercise state powers and that the imposition of that duty needed to be firmly supported by a head of Commonwealth constitutional power, particularly where the exercise of power could adversely affect the rights of individuals. It may be that the High Court will, in future, hold that any duty under which a Commonwealth body has to perform functions and powers must be imposed by a Commonwealth law and cannot be imposed by state law. Such issues could arise under the Commonwealth-state cooperative scheme for the regulation of therapeutic goods. The bill, therefore, aims to prevent an unconstitutional imposition of a duty when a state law purports to impose a duty on a Commonwealth officer or authority. It also extends the range of Commonwealth officers and authorities upon whom duties, powers and functions may be conferred by relevant state laws. Four previous bills have responded to R. v. Hughes, all of which the opposition has supported. Those bills are the National Crime Authority Amendment Bill 2000, the Corporations Bill 2001, the Australian Securities and Investments Commission Bill 2001 and the Agricultural and Veterinary Chemicals Legislation Amendment Bill 2001.Schedule 2 of the bill amends the Industrial Chemicals (Notification and Assessment) Act 1989 and the National Occupational Health and Safety Commission Act 1985 to reflect new administrative and financial arrangements required as a result of changed portfolio responsibilities. The Minister for Health and Ageing now administers the IC(NA) Act and the Department of Health and Ageing now deals with matters relating to the notification and assessment of industrial chemicals. This was previously the responsibility of the then Employment, Workplace Relations and Small Business portfolio, and was under the administration of the National Occupational Health and Safety Commission. In the opposition's view, no concern arises with this change in administrative arrangements, and no concerns arise as a result of the proposed amendment by way of schedule 2.Schedule 3 of the act contains a number of amendments. Amendment 1 amends the Therapeutic Goods Act 1989 to enable the mutual recognition agreement entered into between Australia and Singapore to be implemented. The amendments will allow the secretary of the department to accept the conclusions of good manufacturing practice inspections and manufacturing certificates as evidence that the manufacturing processes employed in Singapore in the manufacture of medicines that are exported to Australia meet with Australian requirements. The amendments also allow the secretary to give effect to any other memorandums of understanding entered into between Australia and other countries.The second amendment in schedule 3 amends the Therapeutic Goods Act 1989 to enable the secretary to obtain information and documentation from manufacturers of blood and blood components about their manufacturing processes and practices, without the need for authorised persons to conduct an audit of the manufacturing premises.The third amendment in schedule 3 requires payment by manufacturers of the complete costs of evaluation for listing of medicines on the Australian Register of Therapeutic Goods in circumstances when the application is withdrawn in the period between completion of evaluation and notification of results by the secretary of the department. Currently, an applicant for registration is only required to pay three-quarters of the evaluation fees before the application is processed and evaluated, with the balance payable upon notification of the secretary's decision, provided this is made within the time frames prescribed. If manufacturers realise that the decision will be unfavourable, the application may be withdrawn before this notification is made, thus preventing adverse publicity and market responses.Schedule 4 of the bill amends the Therapeutic Goods Act 1989 to allow the minister, when determining what therapeutic goods may be treated as listable on the Australian Register of Therapeutic Goods, to impose conditions for the treatment of those goods as listable goods. Listable therapeutic goods pose a lower risk than registered goods and include over-the-counter medicines, herbal medicines and most medical devices. This amendment will mean that some goods may only qualify as a listable product in certain circumstances, such as where the amount of certain ingredients is below a certain level or where the supply of goods is accompanied by an appropriate warning statement. We propose to support those amendments.The bill is, as I have said, in the opposition's view non-controversial. It deals with a range of technical and other necessary changes. In her usual way, the Parliamentary Secretary to the Minister for Health and Ageing has been assiduous and professional in her briefing of the opposition on this matter, and that has assisted in the usual way the passage of this legislation through this place, as I hope it does in the other. I commend the bill to the House.17:01:003861Draper, Trish, MPMrs DRAPER0L6MakinLP10—The Therapeutic Goods and Other Legislation Amendment Bill 2002 will make necessary changes to three acts: the Therapeutic Goods Act 1989, the Industrial Chemicals (Notification and Assessment) Act 1989 and the National Occupational Health and Safety Commission Act 1985. Of particular importance are the changes to the Therapeutic Goods Act, and my contribution is directed to those changes because they will be of the most benefit to my constituents in Makin.The Therapeutic Goods Act came into operation on 15 February 1991 with the aim of providing a national framework for the regulation of therapeutic goods in Australia. The Australian people have a right to expect that the medicines and medical devices that they use are safe and of the highest quality. The object of the act is to ensure that the therapeutic goods that Australians use are of world's best standard and do what they are intended to do. Before any therapeutic good can be sold in Australia, it must be entered in the Register of Therapeutic Goods. The act sets out the requirements these goods must meet before being entered on the register, with complementary conditions imposed in some instances by state government legislation. Broadly speaking, therapeutic goods are any goods relating to the treatment or prevention of disease. The Therapeutic Goods Administration, within the federal Department of Health and Ageing, has responsibility for administering the provisions of the Therapeutic Goods Act. The administration conducts various methods of assessment and monitoring procedures to ensure the safety and quality of therapeutic goods in Australia. These include pre-market assessment, licensing of manufacturers and post-market monitoring. The government wants to ensure that Australians have access to the latest developments in therapeutic medicine as soon as possible while at all times ensuring safety and quality.To ensure that imported therapeutic goods have been manufactured to acceptable Australian standards, the government has negotiated a number of international mutual recognition agreements or MRAs. The latest of the MRAs is with Singapore, but we already have signed agreements with the European Union and the European Free Trade Association and we are currently in discussions with both Canada and Switzerland. The mutual recognition agreements imposed on medicinal products produced in the signature countries established international standards of safety and quality and allow for good manufacturing practice inspections of manufacturers. Through these agreements, Australia has been able to establish a mechanism by which we can scrutinise the manufacture of medicines in foreign countries and monitor their quality and efficacy. This bill will amend the Therapeutic Goods Act to give effect to the Singapore MRA and further MRAs that are in the process of negotiation.A further amendment relates to the listing of therapeutic goods on the register. The decision to list or register a medicine or device on the register is based on the ingredients, the dosage form of the product and the therapeutic claims made for the product. Medicines assessed as having a higher level of risk must be registered and undergo a rigorous assessment and monitoring process. All prescription drugs must be registered. Low risk medicines must be listed rather than registered, the difference being that they are considered to be relatively benign. Most listed medicines are selected by consumers for self treatment, such as vitamin pills or sunscreen products.The bill makes changes to the way these items are listed by allowing conditions to be imposed. This is an important change because it recognises the need to ensure that these products are being used wisely and effectively by consumers. Conditions could include the need for appropriate warning statements or correct use information being placed on the product. They could also impose standards on the level of certain ingredients within a product. Safety and quality are of paramount importance at all times. These changes will apply to items which we purchase off the shelf and whose ability to cure or prevent what ails us we take on faith. The ability to impose conditions, only when necessary, should lead to greater consumer confidence and understanding of the products that they purchase.The final aspect of this bill, to which I now turn, also deals with safety and quality control. In 2001, the World Health Organisation held the first meeting of the Global Collaboration for Blood Safety, bringing together experts from all parts of the globe to develop strategies and make recommendations on blood safety issues. Australia is playing a leading role in the field of blood safety, as was recognised by the appointment of Dr Albert Farrugia, Manager of Blood and Tissues Services in the Australian Therapeutic Goods Administration Laboratories, to the position of specialist adviser to the World Federation of Haemophilia.Haemophiliacs are people with an inherited disorder of the blood-clotting system which makes them dependent on the supply of blood products to survive and live normal lives. As do many other people in our community, haemophiliacs depend upon a safe supply of blood and blood components. A system is already in place which allows for the conduct of an audit of manufacturing processes used in the production of blood products by an establishment. This bill makes changes which go beyond that. The changes will provide for a greater ability to monitor the production of blood products to ensure compliance with new standards for blood and new manufacturing standards for the production of blood components. Once again, these measures are designed to improve safety and quality control and should provide patients with an increased level of confidence in the quality of the treatment they are receiving.Australians enjoy what is undeniably the best system of health care anywhere in the world. But we cannot rest on our laurels. New developments and new products are constantly becoming available with claims being made as to their therapeutic abilities. These claims must be tested; the results must be analysed and monitored. Australia has a well established system for this purpose, and the changes that will be implemented as a result of this bill will serve to improve that system for the safety and benefit of all Australians. I commend the bill to the House.17:08:003863Griffin, Alan, MPMr GRIFFINVU5BruceALP00—I rise to speak briefly on the Therapeutic Goods and Other Legislation Amendment Bill 2002. In the last parliament I had some opposition responsibilities for the issues covered by this bill. If that were the case on this occasion I would probably speak longer. Nonetheless, I will briefly inform the House of aspects of the bill. As the shadow minister said, the opposition supports the legislation as being principally minor amendments which are necessary for the good governance of the system. By way of brief background, the Therapeutic Goods Act 1989 established a uniform national system of controls on the availability of therapeutic goods within Australia. The system is administered by the Therapeutic Goods Administration, which is within the Department of Health and Ageing. The secretary of the department exercises the powers of the TGA. The basic scheme of the legislation is that, unless exempt, therapeutic goods must be entered as either registered goods or listed goods before they may be supplied in, or exported from, Australia. Before goods are made available to the public they are assessed having regard to their quality, safety and efficacy for the purposes for which they are to be used; their conformity with the applicable Australian and international standards; and the manufacture and quality control procedures used. After having been evaluated, goods may be registered or listed on the Australian Register of Therapeutic Goods. It is important to say that the system we have in Australia is certainly one of the best in the world with respect to dealing with these sorts of issues and it has been looked at internationally.There are several amendments and I will briefly describe what they do. Schedule 1 amends the Therapeutic Goods Act 1989 to clarify the imposition of duties and the conferral of functions and powers on Commonwealth officials and authorities within the Commonwealth-state cooperative scheme for the regulation of therapeutic goods following the decision of the High Court in R v. Hughes (2000). The schedule 2 amendments take into account the changes in portfolio responsibilities. The Minister for Health and Ageing now administers the Industrial Chemicals (Notification and Assessment) Act and the DHA now deals with matters relating to the notification and assessment of industrial chemicals. This was previously the responsibility of the then Employment, Workplace Relations and Small Business portfolio and was under the administration of the National Occupational Health and Safety Commission.There are a number of schedule 3 amendments: for example, an amendment to the Therapeutic Goods Act 1989 to enable implementation of the mutual recognition agreement between Australia and Singapore. That is one of a series of such agreements that have been in process over the years. The amendment would also allow the secretary to give effect to any other MRAs entered into between Australia and other countries. Another amendment enables the secretary to obtain information and documentation from manufacturers of blood and blood components about their manufacturing processes and practices without the need for authorised persons to conduct an audit of the manufacturing premises.A further amendment requires payment by manufacturers of the complete costs of evaluation for the listing of medicines on the Australian Register of Therapeutic Goods when the application is withdrawn in the period between completion of evaluation and notification of results by the secretary. Currently, an applicant for registration is required to pay only three-quarters of the evaluation fees before the application is processed and evaluated, with the balance payable upon notification of the secretary's decision, provided it is made within the prescribed time frames. If manufacturers realise that the decision will be unfavourable, the application may be withdrawn before notification is made, thus preventing adverse publicity and market responses.Schedule 4 amends the TGA to allow the minister, when determining what therapeutic goods may be treated as listable on the Australian Register of Therapeutic Goods, to impose conditions for the treatment of those goods as listable goods. Listable therapeutic goods pose a lower risk than registered goods and they include over-the-counter medicines, herbal medicines and most medical devices. This amendment will mean that some goods may qualify as listable products only in certain circumstances, such as where the amount of certain ingredients is below a certain level or where the supply of goods is accompanied by an appropriate warning statement. As I said earlier, the shadow minister has made it clear that the opposition supports this bill as containing necessary amendments to ensure the viable operation of the system. I commend the bill to the House.17:12:003864Worth, Trish, MPMs WORTH8V5AdelaideLPParliamentary Secretary to the Minister for Health and Ageing10—in reply—I thank members for their contributions to this legislation. I thank the opposition for its cooperation and support in ensuring that these important amendments are carried. As all the points that I would have mentioned in my summing-up speech have been mentioned, I commend the bill to the chamber.Question agreed to.Bill read a second time.Message from the Governor-General recommending appropriation announced.3864Ms WORTH (Adelaide—Parliamentary Secretary to the Minister for Health and Ageing) (5.13 p.m.)—by leave—I move:That this bill be now read a third time.Question agreed to.Bill read a third time.Bills3864R15313864Debate resumed from 21 March, on motion by Ms Worth:That this bill be now read a second time.17:14:003864Smith, Stephen, MPMr STEPHEN SMITH5V5PerthALP00—The Australian Radiation Protection and Nuclear Safety (Licence Charges) Amendment Bill 2002 is non-contentious, simple in its effect and is supported by the opposition. The purpose of the bill is to amend theAustralian Radiation Protection and Nuclear Safety (Licence Charges) Act 1998 to confirm that the charges imposed by that act are payable even by Commonwealth entities that are otherwise exempt from taxation, unless the relevant exemption explicitly refers to the act. Under the act, the Chief Executive Officer of the Australian Radiation Protection and Nuclear Safety Agency licenses and regulates the safe use of nuclear installations, radioactive material and apparatus by the Commonwealth and its contractors. An application fee is payable for a licence, and licence holders must also pay an annual charge. Commonwealth entities that currently hold single or multiple licences and are also exempt from taxation include the Australia New Zealand Food Authority, the Australian Nuclear Science and Technology Organisation, the Australian Institute of Marine Science, the Australian National University, the Federal Airports Corporation, the Australian War Memorial and the Director of National Parks. The bill proposes that the amendment be retrospective, taking effect on and from 5 February 1999, immediately after the commencement of the 1998 licence charges act. The opposition supports the amendment and has no difficulty with its substance or with its retrospective nature, as the retrospectivity will validate previous payments of annual charges by licence holders despite the taxation provisions in their legislation. Again, the opposition has benefited from the briefings made available by the Parliamentary Secretary to the Minister for Health and Ageing. That has assisted the smooth passage of the legislation, I hope, through this House and also through the Senate. I commend the bill to the House. 17:16:003865Draper, Trish, MPMrs DRAPER0L6MakinLP10—The Australian Radiation Protection and Nuclear Safety (Licence Charges) Amendment Bill 2002 will enhance the capability of the Commonwealth to protect the health and safety of the Australian people and to protect our environment from the harmful effects of radiation. Before 1998 there was no legislation which regulated Commonwealth radiation sources and practices on a national level. The Howard coalition government was the first to deal directly with this oversight, through the introduction of the Australian Radiation Protection and Nuclear Safety Act 1998. The act introduced, for the first time, regulatory controls of all Commonwealth radiation and nuclear activities. Any organisation dealing with radioactive materials or equipment must now be licensed to do so. The creation of inspectors with strong enforcement powers was a further means of ensuring compliance with this new protective law. Overseeing the new regime is the Australian Radiation Protection and Nuclear Safety Agency. ARPANSA's principal objective is to protect the health and safety of the people and safeguard our environment from radioactive contamination. To do this, a framework for regulation of the Commonwealth's radiation and nuclear activities has been developed which reflects best international practice in radiation and nuclear regulation, and is consistent with the requirements for radiation protection and nuclear safety of the Australian state and territory regulatory authorities. ARPANSA assesses applications for licences against established standards for radiation protection and nuclear safety. It also carries responsibility for inspecting licensed entities to monitor compliance with the established legislative requirements and, if necessary, takes action to enforce compliance.As important and as necessary as the regime of licensing, monitoring and enforcing is—and it is very important for community safety and protection—it does not come without a cost, which the government has decided should be recovered from licence holders rather than be the burden of taxpayers. It is only fair that those institutions and entities which use the radioactive materials should pay the cost. Applicants for a licence are charged a fee and licensees are required to pay an annual charge. In 2000-01, around $2.36 million in application and annual charges was collected by ARPANSA. This bill confirms that the Commonwealth agencies are subject to the same fees and charges prescribed by the Australian Radiation Protection and Nuclear Safety Act. Such confirmation is necessary to ensure the continued recovery of costs for the implementation of the sound regulatory regime that is now in place as a result of action taken by this government to protect and safeguard the people of Australia and our natural environment. I commend the bill to the House.17:19:003865Worth, Trish, MPMs WORTH8V5AdelaideLPParliamentary Secretary to the Minister for Health and Ageing10—in reply—I again thank members for their contributions to this debate. Once again, the points relating to this amendment legislation have been covered. I again thank the opposition for their support for these amendments and I commend the bill to the House.Question agreed to. Bill read a second time. 3865Ms WORTH (Adelaide—Parliamentary Secretary to the Minister for Health and Ageing) (5.20 p.m.)—by leave—I move:That this bill be now read a third time.Question agreed to.Bill read a third time.Bills3866R15123866Debate resumed from 14 March, on motion by Mr Slipper:That this bill be now read a second time.17:20:003866Latham, Mark, MPMr LATHAMK26WerriwaALP00—The Taxation Laws Amendment Bill (No. 2) 2002 contains a series of uncontroversial changes to tax legislation. As a result, Labor will support the bill. The bill removes some anomalies in the access of veterans to the senior Australians tax offset. Labor is absolutely committed to a fair go for our veterans. We promised that we would remember them—most notably in our great national program Australia Remembers, in 1995—and Labor honours that commitment. We welcome the changes made in this legislation. The bill makes some changes to business tax law, in consequence of previous government changes. The major changes are as follows. The bill reduces the amount that needs to be held in company franking accounts by applying a credit for amounts paid prior to the reduction in the rate of company tax. Also, the bill defers changes to tax treatment of friendly societies until July 2002, in order to make them consistent with changes to the tax treatment of insurance companies that the government has deferred. These are rational and proper policy changes that practically assist Australian business, and the Labor Party is pleased to support them. The bill extends tax deductibility of gifts to a number of new or renamed charitable organisations. We support these extensions. Labor supports the changes to tax treatment of demutualisations as contained in the bill. It extends the existing deferral of capital gains tax on demutualisation of Australian mutual organisations to the Tower Group, a New Zealand mutual with many Australian policyholders that demutualised recently. The bill also extends scrip-for-scrip rollover provisions to demutualised shares held in trust. Finally, the bill makes a number of technical amendments to correct the unintended consequences of previous changes to taxation law. The bill removes an unintended exemption from tax on unfranked dividends as paid between group companies. It removes an unintended double refund on franked dividends for shares held in certain trusts. It renumbers parts of the Medicare Levy Act 1986. It makes technical amendments to various acts, including correcting typographical errors, renumbering, correcting a few other provisions and removing some redundant sections. The bill removes eligibility for refundable credits on imputed dividends for noncomplying super funds, and it makes it clear that charities that operate as trusts can claim cash refunds on franking rebates. We have now had six years of this government's rhetoric about the simplification of tax. Labor are concerned that even the public officials who draft our tax laws find themselves making significant errors about the effects of the changes. It is a significant example of this government's failure to deliver on real reform that will benefit Australian taxpayers.That said, this bill makes some positive changes to tax treatment of our veterans, it makes some rational changes to the conduct and practice of business taxation, and it makes some necessary corrections to the Income Tax Assessment Act and other legislation. The opposition support the bill. Our only negative note is that the government plans to introduce some further late amendments. We will not oppose these amendments, but the late notice always makes it difficult for the opposition to process these matters. I urge the government—which does talk a lot about its record on tax reform—to be a bit more efficient and accountable to the parliament when introducing amendments to the House. I know it is difficult when the person who takes tax law through the House of Representatives has no responsibility for tax administration and is just a parliamentary secretary to another minister, but surely the government can have the common decency to introduce these amendments at an early stage to make sure the opposition, the public and various interest groups have a full chance to consider them and can have a decent and full debate on these matters in the House.17:25:003867Secker, Patrick, MPMr SECKER848BarkerLP10—I thank the member for Werriwa for his extraordinary briefness, which means I will have little to debate him on. I rise today to join the debate on the Taxation Laws Amendment Bill (No. 2) 2002. All too often, legislation containing measures which appear to be merely housekeeping go through the motions without many in this place giving serious consideration as to why these measures are needed and the impact that these apparently small changes will have. It is vital to the running of this country that we have fair and equitable taxation laws that are easy to understand and serve the purpose for which they are designed, and this is exactly what this piece of legislation is designed to do. Everyone, from the trucking magnates in the south-east of South Australia to the farmers in the Mallee to the meatworkers in the north and south, and right through to the individuals in my electorate of Barker, needs to be well informed of any changes to the taxation system. It is for this reason that I take a great interest in the taxation laws of this country.While on the face of it this piece of legislation may appear to be tidying up loose ends, if we look further I suggest that we will see that these people I have previously mentioned will in one form or another be affected by it. For example, take the proposed changes to friendly societies. I believe that many of my constituents would be very interested to learn that this piece of legislation seeks to defer the changes to the tax treatment of investment income of friendly societies attributable to funeral policies, scholarship plans and income bonds so that we can allow further consultation with the industry—a very fair thing indeed.The changes which would have seen friendly societies lose an income tax exemption on investment income attributable to funeral policies, scholarship plans and income bonds have been deferred from 1 July 2002 to 1 January 2003, which is a six-month extension. I believe that my constituents would also be interested to learn that this piece of legislation seeks to broaden the class of taxpayers covered by the senior Australians tax offset as well.In order to remove some of the anomalies in the senior Australians tax offset, this legislation will include under this offset: firstly, veterans who satisfy the eligibility criteria for a veterans pension but who do not actually receive the pension; and, secondly, senior Australians, other than veterans, who fail the residency test for the age pension but who qualify for an age pension on alternative grounds. Far from being just a housekeeping bill, this bill goes towards implementing an important announcement of the 2001-02 budget to allow an extension of the low income aged persons rebate, which is now known as the senior Australians tax offset. Taxation amendments are very important in keeping our taxation system consistent and coherent, and this is why these bills should not go unnoticed. Over the years, the coalition have been instrumental in improving our taxation system. From the introduction of the new taxation system to the various bonuses we have made available, we have always had the interests of the nation at heart. In recent times our constituencies have seen many benefits that have resulted from changes to our taxation system. We have reduced the personal income tax rate so that ordinary Australians get more in their pocket. We have introduced child-care rebates, family tax rebates and even a baby bonus.The coalition government has recognised that one of the hardest times for families financially is after the birth of their first child. Generally one parent has given up or reduced paid employment to care for the child, which results in families often having a quite significant reduction in the household income. The baby bonus is a refundable tax offset, which effectively allows a parent to pay tax as if their income before the birth of the child was spread over a period of up to five years.Since the introduction of the new tax system, both individuals and businesses have benefited from the reductions to both personal income tax and busines taxation. The company tax rate has already been reduced to 30 per cent. This piece of legislation is important in that it makes changes to the franking or dividend imputation regime following the reduction in the company tax rate from 34 to 30 per cent on 1 July 2001. This piece of legislation offers amendments which are designed to preserve the value of franking credits accumulated before the rate change, by substantially the same mechanism as the one adopted for the previous rate cut on 1 July 2000. I have already said that this government is committed to providing a fair, equitable and consistent tax system—this bill is necessary to do that.My honourable colleague the Assistant Treasurer described this bill in her press release as a series of `diverse tax measures that were technical but essential'. She also went on to say that the legislation contained `some updated anti-avoidance measures to assist the ATO crackdown on tax cheats'. With taxation fraud costing Australia millions of dollars each year, I think this is a very important aspect of this piece of legislation. It is important for me to dwell on this issue for a moment. It does not matter where I go or who I am with, there will always be someone who has something bad to say about our taxation system. There appears to be an unwritten rule that states that taxation is bad and that Australians are overtaxed and should not be taxed. It is under this guise that I believe these tax cheats justify what they are doing.Let us take a look at that. Hypothetically, we could abolish the tax system. Hooray! No-one would be taxed on their wages, goods and services would not be taxed and all the money would go into our back pockets. It sounds fantastic, doesn't it? However, let us take a closer look. What initially springs to my mind is: how do we provide for all the pensioners in the country? How do we provide for our health system to care for our sick? How do we provide for education for our young? How do we provide for our unemployed? How do these people survive? The majority of Australians understand this. They understand that taxation is necessary—call it a necessary evil if you like—to run this country, and the majority of people are willing to pay a fair share of tax. However, there are still those who do not pay their fair share of tax, and it is because of them that pieces of legislation such as the amendments in this omnibus bill are necessary.While this bill does not deal specifically with the kind of tax fraud I am talking about, every little bit of fraud costs the Australian public. Every little bit of fraud prevents us from providing extra services. If we can stamp out one little bit, we will be one step closer to a fairer and more equitable system. The point I make when discussing tax fraud is that these people who defraud the taxation department are actually defrauding themselves. They merrily think they are defrauding the government. However, really they are defrauding the Australian population as a whole. The less tax they pay, the less revenue we in this place have to spend on services for the Australian population. That means less money to spend on such things as the Pharmaceutical Benefits Scheme, which may help the elderly parents of these tax cheats get their prescriptions. It means less money to spend on the education of their children. It means less money to assist with their child-care arrangements. It means less money for hospitals, which may be needed to treat their sick relatives or indeed themselves. It means less money to spend on Work for the Dole schemes, which may help their unemployed friends get back into the work force. And it means less money to spend on business grants designed to assist their businesses.In short, the point needs to be made that these tax cheats are cheating themselves. They are defrauding their families, relatives, friends and businesses for what generally is very little gain. While they get very little gain, they cost the taxpayer a lot. Since this government came into power in 1996, we have certainly made progress in this area. Our responsible policies have seen budget surplus after budget surplus, while our ability to make the tough decisions and see them through to fruition means that in general we as a country are in a much better position than we were prior to 1996.Turning back to the piece of legislation at hand, I would like to make mention of a couple more of the amendments which I believe are worthy of being specifically considered. This bill also seeks to make a range of amendments to the gift provisions of the income tax law to give effect to the announcements that the government has made over the past several months. The bill seeks to enact an amendment that allows gifts of $2 or more to certain organisations to be tax deductible. This measure, albeit quite small, goes a long way to encouraging donations to be made to these organisations, all of which are very worthy causes. By encouraging donations, these organisations have the capacity to increase their funding, which in turn helps with the various research and social programs that they run. Eleven new organisations are listed in the tax-deductible class, and they include the National Breast Cancer Centre Gift Fund, the Australian Primary Principals Association and the Australian Red Cross Society American Disaster Fund, which was set up after September 11. Allowing tax deductibility to an organisation such as the National Breast Cancer Centre Gift Fund, I am sure, will boost donations to this organisation. With the added incentive of tax deductibility for as little as a $2 donation, people may be more inclined to donate money to this very worthy cause. And even if it is only $2, if we can attract enough people to donate, the donations may make the difference in funding vital research. Effectively, this clause allows for these organisations to be just a bit more self-sufficient and that little bit less reliant, if at all, on the government for vital funding. No-one would doubt the worthiness of these organisations and the work that they do, and this clause, albeit a small part of this bill, is vital to these organisations and their fundraising abilities.In addition to this tax deductibility clause, this bill contains provisions to deal with demutualisation problems faced by mutual entities and members of mutual entities. I note that the previous speaker, the member for Werriwa, also raised this issue. The purpose of this clause is to allow concessional treatment for the members of non-insurance mutual entities upon demutualisation. Broadly, when a non-insurance mutual entity demutualises, members of the mutual entity who receive shares as a result of that demutualisation are not subject to capital gains tax until they dispose of those shares, and the cost base for the shares issued to members as a result of the demutualisation is specified.What this amendment seeks to do is to qualify members of non-insurance mutual entities that demutualise using a hybrid of two already approved methods for concessions currently available to the members of entities that demutualise using the approved methods. The benefits referred to are the capital gains tax rollover and a more favourable tax base. This bill will also allow for capital gains tax rollover relief to a trustee who exchanges demutualisation shares for shares in another company in a scrip for scrip swap.This amendment seeks to change the current law, which may give rise to an inappropriate capital gain or loss to the trustee and may result in an inappropriate outcome for the member. This amendment seeks to make the law as fair as possible in relation to this situation. In fact, all the amendments that I have spoken of this afternoon are designed to make our system somewhat fairer in their own small way. Having considered all of these amendments along with the others contained in this piece of legislation, it would appear that on the whole all of these amendments seek to improve our taxation system in one way or another. From bringing small anomalies into line to providing income tax deductions for gifts to certain organisations, this piece of legislation is vital to the government's continued quest to improve our country's taxation system.That is what I am proud of most with this government: our attention to detail and our commitment to continual improvement, which in turn means that we are able to look to the future and initiate policies which will take us there. With each little change we are one step closer to our goal of a fairer and more equitable taxation system. Only continual review of this system will help it to keep moving with the times and the needs of our country.I am proud of our taxation system and I am proud that it is because of the Howard government that it is in the shape it is in today. It is not perfect—I am aware of that, and I often hear those comments out in the community—but in a continually evolving society with continually evolving social issues I am not sure that there will ever be such a thing as a perfect taxation system. However, as I have previously said, we are continually working on ways to constantly improve this system.Unlike those opposite, who bowed to union pressure and refused suggestions of change, who let not only our taxation system but also our economy stagnate and who continually let the Australian population down, we are always looking for ways to move forward and are always open to suggestions as to how we might progress. We have introduced this bill with that in view. We want to move forward. We want a dynamic and effective taxation system which, to the best of its ability, gives the country what it needs. We want a taxation system that is fair and equitable and we want a taxation system which has the capability to provide Australians with what they need on a long-term basis.Any bill that works towards these goals certainly deserves serious consideration. We need to get past the political rhetoric—we need to avoid the `he said, she said' games that those opposite seem to play in many instances when debating issues of importance—and seriously consider the merits of this piece of legislation. These amendments are for the good of all Australians. Regardless of colour or creed, this bill is about being fair and equitable. It is about achieving that dynamic taxation system I was talking of and it is about setting us up for the future and providing us with a sustainable system designed to provide us with what we need.I would like to take this opportunity to say that, while on the outside this bill appears to relate to what I refer to as `housekeeping' issues, the impact of these issues is vast and wide. I hope that I have been able to enlighten members on both sides of the House as to the importance of this piece of legislation, in the hope that, when the next housekeeping bill comes along, members might consider it further and look at the underlying issues and the impact that the relevant changes will have on society. Only when we really consider these bits of legislation seriously, and consider all their clauses—not just look at them, but really see them—can we really debate the issues and make a recommendation to the House. In the case of the Taxation Laws Amendment Bill (No. 2) 2002, I believe I have done that. It is on this basis that I advise you, Mr Deputy Speaker, of my unfaltering support for this piece of legislation and the amendments contained within it. I commend this legislation to the House and hope that those opposite do so as well. 17:43:003870Emerson, Craig, MPDr EMERSON83VRankinALP00—The Taxation Laws Amendment Bill (No. 2) 2002 is essentially noncontroversial and, as such, Labor has no difficulty in supporting it—just as time after time we support legislation that comes before the parliament that we consider to be good, reasonable and fair. I think it is probably not well understood in the wider community just how much legislation both sides of politics agree on. The role of the Main Committee is not at all understood in the wider community, but it plays an important role in allowing debate on legislation where both sides of the parliament are in agreement. I want to make the point that, while at question time it might appear that the chamber is deeply divided—and more often than not at that time of day it is—when we come to the substantive legislation, we on the Labor side do support the government's program when it is fair and when it advances the interests of this nation.This bill is fair and in a small but significant way it does advance the interests of the nation. It contains a number of provisions that the previous speaker, the member for Barker, described as housekeeping. They are probably of that category or a little bit more elevated than simple housekeeping, but I thought I would take the opportunity to refer briefly to some of them. The bill provides for an amendment to the imputation rules to take account of the reduction of the company tax rate from 34 per cent to 30 per cent. It also defers the commencement date of particular proposals to tax friendly societies. It provides an amendment so that neither an intercorporate dividend rebate nor a related deduction is allowed in respect of any unfranked dividends paid to or by a dual resident company. The bill also removes any scope for double refunds of excess imputation credits to both a trustee and a beneficiary. Among several other provisions, the bill broadens the class of taxpayers eligible to claim the senior Australians tax offset.Mr Deputy Speaker Wilkie, one impact of this legislation is that it adds to the bulk of the Income Tax Act. You may recall that in the last parliament I took the time to download the Income Tax Act off a web site and I found, to the dismay of everyone on this side of the parliament, that it had become a very bulky document indeed. I think that dismay has been shared by the broader community and certainly by the business community because the act has increased in size, going from about 3,000 pages to 8,500 pages. This was in the context of the government being elected in 1996 with a commitment to cut red tape by 50 per cent. When the Treasurer and the Prime Minister were questioned about the impact of the so-called streamlined new tax system for a new century on the size and complexity of the Income Tax Act, they both said unequivocally that it would make the act less complex and reduce its size. Nothing could be further from the truth.I think this parliament ought to be looking at ways of simplifying the tax system of this country, not making it more complex. Certainly Labor has proposed, in respect of the GST, a radical simplification which has come to be known as the ratio method. That simplification would be to the advantage of very small businesses. It would be a very big advantage: they would be able to complete the paperwork involved in assessing their GST obligations in a matter of a couple of minutes. Unfortunately, the government has not picked up this proposal, which is in the form of a private member's bill in this parliament. The proposal has been welcomed by the small business community. Before the election, the Council of Small Business Organisations of Australia welcomed it, and I have checked with small business representatives in this country about their ongoing interest in this very substantial simplification of the tax system for small business and they are very strongly in favour of it. So why the government would not pick up this policy bewilders me, because I do not mind at all if Labor brings forward good policies and the government recognises them as good policies and picks them up. The coalition is in government, and I hope and believe that we are all here for the purpose of making Australia a better place. A very significant way of doing that would be to allow small business to thrive in Australia and not be weighed down by a massive paperwork burden—which it is—not only in respect of income tax obligations but also in respect of the GST. So I would urge the government to reconsider that simplification, the so-called ratio method, because it would be very good for small business and therefore very good for Australia.I also refer to the issue of the taxation of non-resident foreign company executives. Earlier today there was a fairly heated debate on Taxation Laws Amendment Bill (No. 4) 2002 because Labor is not comfortable with the proposal to exempt from income tax income earned by non-residents on assets overseas. Since contributing to that debate, my attention has been drawn to some disturbing revelations. I guess I had not fully appreciated that the costing of $50 million was not known to the Australian people before the last election. When the Treasurer announced these tax breaks in his press release of 11 November 1999, no costings at all were provided. This decision was recorded at page 37 in the midyear review of 1999-2000 and expanded on at page 90, and no costings were provided. It was stated at that time that a reliable estimate could not be made. In a press release on 15 October 2001 in the lead-up to the election, this was referred to again but the press release said the measure `is not expected to materially affect the forward estimates'. Then the 2001-02 Mid-Year Economic and Fiscal Outlook said at page 25, in respect of costings, that the costing for this measure was `unquantifiable'. What I am saying is that, before the last election, on four or five occasions the government had the opportunity to put a cost on this. Once the election was over, the costing was provided: $50 million a year or $200 million over the forward estimates period. That is very convenient when we go to questions of the Charter of Budget Honesty and claims by the coalition that Labor do not provide adequate costings, notwithstanding the fact that all our costings were provided by Access Economics, former Treasury officials. But when the shoe is on the other foot and the government itself has an opportunity to tell the Australian people just how much revenue will be involved in providing tax relief for foreign company executives, all the way in the lead-up to the last election—beginning back on 11 November 1999—this was `unquantifiable' or `small'. Now we are past the election, the legislation has been brought before the parliament and we are told it is $50 million a year. What perplexes me is that the government are saying, `Look, we're finding it difficult to make ends meet with our budget and therefore we have to make cuts in respect of pharmaceutical benefits and the disability support pension arrangements; but it is all right, we've found $50 million a year to give to expatriate business men and women on their foreign sourced income.' It is a very strange set of priorities on the part of this government.Finally, I urge the government to look seriously at this question of simplifying the income tax system. I think that the corporate world have some responsibility here, as well. The corporate world say, `What we want is a simple tax system; this is far too complex.' I agree with them on that. But in the next breath many of them say, `But I need a tax break for my industry, for my business, for my activity, and I need that tax break written into the Income Tax Act.' So the very people who correctly argue that the Income Tax Act has become massive and incredibly complex are then lining up for their own particular concession. They cannot have it both ways.We need to come together as a country on this issue and work towards simplification. But if we are going to simplify it we need to look at a range of specific industry concessions and evaluate those concessions to see whether they are in the national interest. And, in the process, if we can make simplification a key objective, that should be done. I think there is scope for simplifying the Income Tax Act in this country, but these particular measures do not contribute to that simplification. It is not a major criticism because I know the measures are not controversial; they are supportable and will be supported by Labor.I close with the exhortation that we use the opportunity to look at the Income Tax Act and commit ourselves to genuine simplification so that business can get on with what it does best—employing people and making money—instead of spending a lot of time trying to understand the Income Tax Act and, in lots of cases, trying to avoid income tax by using loopholes that are deliberately created in the income tax system to provide particular concessions for particular industries. So let us start working in the national interest on this great endeavour; let us do something genuine about simplifying the income tax system instead of watching its further expansion—the size of the act has already increased from 3,000 pages to 8,500 and rising.17:55:003872Slipper, Peter, MPMr SLIPPER0V5FisherLPParliamentary Secretary to the Minister for Finance and Administration10—in reply—The government would like to thank those honourable members who participated in the debate on the Taxation Laws Amendment Bill (No. 2) 2002 and to thank the opposition for its support. As the member for Rankin indicated, in regard to this bill there appears to be an outbreak of peace—and that is very good to see; it is very reassuring.It is true that a lot of legislation proceeding through the parliament is supported by both sides of the chamber. Perhaps as a parliament we are not given credit for this. I suspect the disgraceful scenes in question time—when members of the opposition breach the Speaker's rulings and we see the antics of the member for Werriwa and other honourable members—do give the parliament a bad image as far as the community is concerned. Regrettably, the consensus which often occurs with respect to bills simply does not get the public airing that it should.The Taxation Laws Amendment Bill (No. 2) 2002 is an omnibus bill. It contains measures which are largely technical in nature; that has been pointed out by other members in their speeches. Nevertheless, it is important for the better operation of the tax law. Some of the measures are introduced for the first time; others lapsed at the last election. The first measure is the consequential changes to the franking or dividend imputation regime following the reduction in the company tax rate from 34 per cent to 30 per cent on 1 July last year. The measure means that franking credits accumulated before the rate change do not lose value. The mechanism used is substantially the same as was adopted for the previous rate cut from 36 per cent to 34 per cent on 1 July 2000.The second measure defers changes which would have seen friendly societies lose an income tax exemption on investment income attributable to funeral policies, scholarship plans and income bonds. The bill, together with amendments which have been circulated, will defer the changes from 1 July last year to 1 January next year. These changes, linked to proposals to tax life insurance policyholders as if they were shareholders in companies, arise from recommendations made by the Review of Business Taxation. In the budget it was announced that the government would not be proceeding with the life insurance policyholder measures and consequently I am foreshadowing that I will be moving amendments to omit the measures to change the calculation of the capital component. The third measure in this bill fixes a drafting error which would have allowed an intercorporate dividend rebate or related deduction for unfranked dividends to be paid to or by a dual resident company, contrary to the original intention of the legislation.The next measures also relate to imputation credits. Firstly, situations have been detected where both a trustee and a beneficiary are entitled to the same refund of excess imputation credits. The law will be amended to allow the beneficiary to claim the refund. In addition, schedule 4 contains an anti-avoidance measure related to excess imputation credits. It has emerged that noncomplying superannuation funds and noncomplying approved deposit funds can be used to access refunds through artificial arrangements. This is obviously not desirable. The funds will be denied access to the credits to ensure that the practice does not occur. Thirdly, there are some technical corrections to ensure that charitable trusts do not miss out on refunds of imputation credits in respect of distributions received indirectly through another trust.Schedule 6 will amend the senior Australians tax offset rules, to allow more taxpayers to qualify: veterans who are eligible to receive a pension, allowance or benefit under the Veterans' Entitlements Act 1986 but do not actually receive one, and people who fail the residency test for the age pension but are eligible for the age pension on other grounds. The bill ensures that taxpayers who got shares in Tower Ltd as a consequence of the demutualisation of Tower Corporation, a former New Zealand resident mutual company, in October 1999 are not subject to capital gains tax until they sell the shares. The amendments also specify the cost base for the shares and ensure that a nonresident life insurance company with many Australian policyholders that demutualises is treated in the same way as a resident life insurance company.The bill also contains provisions to deal with two demutualisation problems. Firstly, members of non-insurance mutual entities that demutualise using a hybrid of two already approved methods will qualify for the concessions: capital gains tax rollover and a more favourable tax base than currently available to members of entities that demutualise using the approved methods. Secondly, the bill will give capital gains tax rollover relief in circumstances where a trustee exchanges demutualisation shares for shares in another company, in a scrip for scrip swap. The trustee will not be liable for capital gains tax when the shares are transferred to the member.Schedule 9 to the bill lists 11 new organisations in the tax deductible class. They include the National Breast Cancer Gift Fund, the Australian Primary Principals Association and the Australian Red Cross Society American Disaster Fund set up after September 11. Finally, the legislation makes a number of purely technical corrections to tax and tax related legislation.The member for Werriwa queried why the government has so many amendments. I want to point out to him, as did the honourable member for Barker, that the Howard government strives for a tax law which is fair, equitable and consistent, and this bill is part of the process. I was also very interested to listen to the curious proposition put forward by the honourable member for Rankin, who brought forward what he called the ratio method with respect to GST. He said the ALP support the principle of making the GST simpler. But it was only a short time ago that the ALP were supporting roll-back, which of course meant additional complications for small business and business more generally. Yet they now hate the GST so much that they are going to keep it! The member for Rankin also referred to small business and seemed to exhibit at least a passing concern about small business. If the ALP were in any way, shape or form interested in assisting small business, they would support the government's fair dismissal legislation, which would create tens of thousands of jobs right around the country. And of course it is not too late.ET4Bevis, Arch, MPMr Bevis—How many jobs? Tell us again. I think it is about 15!0V5Slipper, Peter, MPMr SLIPPER—It would in fact create about 50,000 additional job opportunities. The member for Brisbane asks how many jobs; yet on so many occasions the ALP have overturned this government's attempts to bring about equity, to bring about a situation where small business is able to grow, invest and put on staff. We have a situation where, in a serial way—they are serial offenders—the ALP are continuing to condemn many Australians to being on the dole queue. Quite frankly, the people of Australia are absolutely disgusted. The member for Brisbane, who has been around for a while, ought to talk to members of the frontbench of the ALP—and, of course, he was dumped from the frontbench—to convince them to support the government's measures, which will benefit small business and give many people the opportunity of getting one foot on the employment ladder.The member for Barker, in what was a really thought-provoking presentation, emphasised that this bill is not merely a housekeeping bill. He stressed that the bill implements an important part of the 2000-01 budget, the senior Australians tax offset. This was an important budget measure to provide assistance to a very important group of the Australian community—to seniors who, during their working lives, have contributed a lot to give Australia the freedom, stability and way of life which we have as a nation and which makes us the envy of people throughout the world. The bill extends the offset to self-funded retirees who although not in receipt of a government pension would be eligible for a pension. This particularly assists self-funded retirees—those Australians who have prepared themselves for retirement.It was also interesting to listen to the prattle from the member for Rankin, who spoke about governments saying one thing before an election and then saying something else afterwards. Well, he is a member of the Australian Labor Party and he could hardly keep a straight face, because it is only a few years since the Keating Labor government told us that the budget was in surplus prior to the 1996 election and yet we discovered, upon their election to office, on the Monday—and I see Mr Hockey agrees enthusiastically with what I am saying here—that, far from the budget being in surplus, there was a $10.3 billion Beazley black hole in the budget. They are hypocritical insofar as the member for Rankin comes in here and criticises this government. We place a very great emphasis on the importance of delivering our election promises in full and on time. The ALP break election promises. They are prepared to do and say anything prior to getting elected and then they break those promises after the election. They said in 1996 that the budget was in surplus, whereas it was a long way away from being anything even like in surplus. That is why this government had to accept some difficult economic decisions. We did not create the problem but we did accept the responsibility for fixing the problem. This is an important bill. It is a bill which enjoys the support of both sides of the parliament, and I am particularly pleased to commend the bill to the House. Earlier in my speech I foreshadowed certain amendments that I will be moving a little later.Question agreed to.Bill read a second time.Message from the Governor-General recommending appropriation announced.3875Bill—by leave—taken as a whole.18:07:003875Slipper, Peter, MPMr SLIPPER0V5FisherLPParliamentary Secretary to the Minister for Finance and Administration10—by leave—I present a supplementary explanatory memorandum to the bill and move government amendments (1) to (5):(1) Schedule 2, item 1, page 22 (lines 7 to 9), omit subparagraph (ia), substitute: (ia) amounts received on or after 1 July 2001 but before 1 January 2003, that are attributable to *income bonds or *funeral policies; and (ib) amounts received on or after 1 July 2001 but before 1 January 2003, that are attributable to *scholarship plans and would have been exempt from income tax under section 50-1 if they had been received before 1 July 2001; and (2) Schedule 2, item 1, page 22 (line 10), omit “1 July 2002”, substitute “1 January 2003”. (3) Schedule 2, item 2, page 22 (lines 13 and 14), omit the item, substitute:2 Subsection 320-75(2)Repeal the subsection. (4) Schedule 2, item 3, page 22 (lines 15 and 16), omit the item, substitute:3 Subsection 320-75(3)Omit “In respect of policies issued before 1 July 2001, the”, substitute “The”.3A Subsection 320-75(4)Omit “paragraph 2(b) or”. (5) Schedule 2, item 4, page 22 (line 18), omit “1 July 2002”, substitute “1 January 2003”.The exemption from tax that applies to income derived by friendly societies that is attributable to funeral policies, scholarship plans and income bonds sold after 30 November 1999 was removed with effect from 1 July last year. Schedule 2 to the bill proposes to extend that exemption until 1 July 2002. The removal of this exemption was linked to the introduction of the proposed review of business tax life insurance policyholder reforms. The government has decided that, due to concerns about compliance costs, these reforms will not proceed. However, the reforms affecting these friendly society products will proceed with some modification with effect from 1 January 2003. Consequently, the amendments extend until 31 December 2002 the exemption from tax that applies to investment income received by friendly societies that is attributable to funeral policies, scholarship plans and income bonds sold after 30 November 1999. Schedule 2 to the bill also proposes to defer from 1 July last year to 1 July this year the change in the methodology that must be used by life insurance companies to work out the deduction for the capital component of ordinary investment policies. This change was also linked to the life insurance policyholder reforms. As those reforms are not to proceed, the amendments remove the requirement for life companies to change the methodology for working out this deduction. Consequently, life companies will continue to work out the deduction on an actuarial basis. I am particularly pleased to be able to commend these government amendments to the chamber.Question agreed to.Bill, as amended, agreed to.3875Mr SLIPPER (Fisher—Parliamentary Secretary to the Minister for Finance and Administration) (6.10 p.m.)—by leave—I move:That this bill be now read a third time.Question agreed to.Bill read a third time.Bills3875R14703875Debate resumed from 17 June, on motion by Mr Abbott:That this bill be now read a second time.18:11:003876Cobb, John, MPMr JOHN COBB00AN1ParkesNP10—I rise tonight in support of the Workplace Relations Amendment (Secret Ballots for Protected Action) Bill 2002. I congratulate the Minister for Employment and Workplace Relations for bringing this legislation before the House so promptly, following the coalition's victory last November. We need this bill because we are not seeing democracy at work in the case of workplace relations. The legislation is of particular interest to my constituency which covers a third of country New South Wales and which includes a substantial number of people employed by small business and primary industry. These two sectors have traditionally been affected by unnecessary strike action, directly or in a secondary situation from strikes in other areas. The secret ballot process proposed by the bill will not only create and protect jobs by preventing unnecessary strikes but also provide freedom of choice for workers and, most importantly, strengthen the accountability of unions to their members. We have all witnessed the crippling impact union initiated strikes have had on this country in the past. Rural and regional Australia has traditionally copped the brunt of such action, and it has certainly cost us dearly: produce has rotted on the waterfront, sheep have gone unshorn, petrol prices have increased, local stores have been unable to source their goods and our children have missed out on jobs because of the stranglehold the union movement has been able to impose upon its members and upon our industries. As a primary producer myself and in my past role as president of the New South Wales Farmers Association, I know only too well that Australia's reputation, when trading primary produce around the world, revolves around not only our excellent quarantine record but also our ability, or frequently our non-ability, to deliver goods in good condition and on time. We can all remember the very public waterfront disputes that pitted rural Australia against the unions in often very dramatic circumstances while our customers, out of frustration, began to look elsewhere. Certainty of supply is something that anybody in business knows, values and will go anywhere to attain. These strikes not only threatened to destroy our valuable and very hard-earned markets but also, not surprisingly, left a bitter taste in the mouth of everybody who produced and who worked for those who produced. It certainly means that dealing not so much with the unions but with the union leadership becomes fraught with anger and fraught with unnecessary disputes. Political strike action also cuts to the heart of small business. An electorate like Parkes—in other words, the backbone of country Australia—might be physically distant from metropolitan Australia, but business feels the ripple effects of strike action wherever it originates.The secret ballot process has been very well documented overseas. In countries such as the United Kingdom industrial action can be reduced—in fact will be reduced—via the secret ballot process. It is a fair, effective and simple process for determining whether a group of employees at a workplace want to take action or whether they want to exercise their own feelings and what is in their own interests. The process, to be overseen by the Australian Industrial Relations Commission, will make a secret ballot compulsory before any strike action takes place. Forty per cent of affected employees must vote and, of that number, 50 per cent—a half of them—must agree to the action before it can legally happen. It will ensure that the right to protected industrial action is not abused by union officials pushing agendas very often totally unrelated to what is in the interests of the workers at the workplace concerned. As the Minister for Employment and Workplace Relations pointed out in this House, secret ballot provisions have been operating in the UK since 1984. In that country the unions have been made to consult more with their members. The legislation has the support of UK trade union leaders. Secret ballot arrangements also exist in Canada, Japan, Germany and Ireland.It is important to point out that secret ballots will not impede access to lawful protected action but simply provide a mechanism to ensure that protected action is a genuine choice of the employees involved. For example, each employee of a mine in Cobar or Broken Hill or of a factory in Dubbo will be able to have a fair dinkum say—in other words, his or her say—on whether they want to take strike action, without fear of retribution. Nobody—not their employers, their fellow workmates or the unions—will ever know how they voted. Wouldn't that be terrible! In addition, employees can appoint an agent to conduct the ballot in order to further ensure their anonymity. The federal government would subsidise the cost of these ballots by 80 per cent. The unions—or, more correctly, their leaders—will no longer have the ability to dictate whether employees go on strike, and the community will know that any strike action that occurs is because of genuine concerns of the employees. The benefits of the secret ballot process, which will work for both the employer and the employee, should be clear to the parliament, and certainly I am sure it is clear to the wider Australian community.I said earlier that this bill is really about democracy not happening. I have been involved in a lot of ballots and a lot of votes, and never once did I see a situation where anybody who wanted a secret ballot could not have it. Why would you be against a secret ballot? Surely, the union movement wants a right decision, and surely members sitting on the opposition benches would rather see a right decision—a decision that reflects the wish and desire of union members, rather than the wish and desire of union leaders. The current situation does nothing but allow political decisions. In actual fact, I wonder if this bill is something that might benefit the Labor Party. I am sure that, had the Doug Cameron inspired strike prior to the election vote been a secret ballot, there is every chance that that strike would not have happened. The way the then leader of the Labor Party pleaded with the union—I think it was the Tristar dispute—to go back to work would suggest that, in that case, a secret ballot might have been in the best interests of the Labor Party as well.This is not about the union movement or workers. This is about union leaders imposing standover tactics on people who are being denied the right to vote in their interests, rather than in the interests of union leaders, some of whom have political aspirations. Certainly it highlights the fact that the union movement, or its leaders, and the Labor Party are talking the same language. The only thing I can think about that compares with this is the fact that the Labor Party have refused to look at electoral fraud. Is that the same issue? Are they saying, `We do not want to get to the truth. We do not want the right vote to come through. Therefore, we do not want secret ballots in the union for the same reason that we do not want to look at electoral fraud.' Is that what they are saying, because what is happening now is in their interests, or they perceive it to be? As people who certainly pride themselves on being in a country that heralds democracy, how can they still have in their midst the most undemocratic action that exists in Australia—that is, non-secret ballots within the union movement? I know that my electorate and workers in my electorate would be enormously advantaged by secret ballots. I am sure that Australia would be greatly advantaged by secret ballots—and, you never know, even the Labor Party might be; but certainly our country would be. I have to support this bill. I cannot believe that any right-thinking Australian would be against democracy.18:22:003877Bevis, Arch, MPMr BEVISET4BrisbaneALP00—The proposition in Workplace Relations Amendment (Secret Ballots for Protected Action) Bill 2002 has been in bills before the parliament on a number of occasions and has been rejected by the parliament before. It is worth noting that it was rejected by the parliament and not just the Labor Party. The Labor Party and other parties in the Senate joined to defeat this, not because the Labor Party or those other parties do not subscribe to the principles of democracy we have heard so much from the other side about; the reason it has been defeated in the past—and I suspect will be defeated on this occasion—is that, contrary to the rhetoric we heard from a succession of speakers in this debate a couple of nights ago when this matter was before the House, the bill has precious little to do with democratising the workplace. This bill is not motivated by the government wishing to democratise the workplace; it is designed to reduce the opportunity for organised labour to withdraw their labour. It is designed to place as many impediments in the process as possible. That is why similar legislation has been defeated in the past.References to the United Kingdom are interesting, because there is, I would have thought, enough material around even for members of the government to understand that the legislation in the UK is different from that which applies here. To suggest that the Labour Party or trade unions in the UK would endorse this bill is clearly untrue. They do have a system of compulsory voting in the UK and it is different to that which is proposed here and which has been defeated in the past. The member for Parkes has demonstrated that a little bit of knowledge is certainly a dangerous thing. I am indebted to him for raising the issue of the Tristar dispute, because it was during the Tristar dispute that his minister—the current minister and Leader of the House, who is well known for his moderate approach to things both in and outside the chamber—decided to attack the workers at Tristar and refer to them as being guilty of treason. To refresh the memory of the member for Hume and possibly others, the workers at Tristar were taking industrial action in an effort to protect their entitlements; not to ask for more money but simply to ensure that their long service leave, annual leave and accrued entitlements would be there if the company went belly up. For that sin they were attacked by this minister in and outside this parliament as being guilty of treason. He inflamed the situation—that is not uncommon.So often in these debates, members of the government have a little bit of knowledge and a great deal of prejudice. It is a very volatile mixture. We saw it the other night when the member for Hume characterised himself as the `nemesis' of the Labor Party in industrial relations matters because in the sixties, he told the parliament, he had worked in an abattoir and had been through experiences that he recounted were improper or unfair. That is actually part of the problem: 40 years after the event, members on the other side want to continue that same rhetoric. Anybody who has been involved in the operations of industrial relations—whether from the employer or the employee side—over the last 20 or 30 years knows there has been a massive revolution in thinking and practice. That appears not to have permeated the government benches. They still use the rhetoric of the sixties. We heard it the other night from the member for Hume, and we hear it often from the minister—the rhetoric of the sixties. So that I am not totally critical of the government, I want to say that I also listened in part to the contribution from the member for Grey, who I thought made a genuine effort to try to deal with the issue on a more balanced plane. This was refreshing and an approach that should be commended to the minister, except it would fall on deaf ears—he is not capable of doing that. That is not just a view I have. I was interested to see the latest Inside Canberra of 14 June which has a comment—DK6Hockey, Joe, MPMr Hockey—That's a socialist rag!ET4Bevis, Arch, MPMr BEVIS—Big Joe just labelled it a `socialist rag', so there you go.DK6Hockey, Joe, MPMr Hockey—It is not as good as Crikey!ET4Bevis, Arch, MPMr BEVIS—It said that `Newspoll has industrial relations 13th in importance (second last)'. Let us get this right. The government froth at the mouth every question time. Every question time there is at least one dorothy dixer to the minister. He goes through his rehearsal in the morning. I imagine he still drags in senior departmental staff in the morning to go through the rehearsal. He puts on the theatrics, gets the applause from the team and psyches himself up. He is pumped up, he comes into the chamber and he has his dorothy dixer—very little of which, I have to say, ever gets in the media because it is so predictable and boring to all of us here that it does not rate a mention. It is good entertainment and fodder for the fools on the back bench but actually does not do a great deal to enhance the public debate. The fact of life is that industrial relations rates 13th, notwithstanding their efforts every day to try to make something of it. Let me finish the reference from this edition of Inside Canberra. It said:... with Labor leading with 39 per cent as the party best able to handle IR, ahead of the government on 30. It has been like that for many years. The public understand that the Labor Party has a much fairer and better grasp of these issues than does the coalition. The article went on and said:There was a time when the minister running industrial relations was supposed to do something about settling dangerous strikes, not exacerbate them. When Harold Holt was Minister for Labor in the Menzies Government and a serious strike broke out or threatened, he would immediately get in touch with his good friend, Albert Monk, the ACTU president, to try and facilitate a settlement. Tony Abbot, on the other hand, stands firmly in the employers' corner at all times and in the BHP dispute refused to do anything other than say the strikers are law breakers. He was asked last weekend on Meet the Press whether he was “prepared to go for conflict with the union rather than trying to resolve it within this industry”. He responded: “I mean, someone who takes hostages can't really then demand that the Premier and the Police Commissioner sit down and have a summit with them.” In the end, the strike was settled, as strikes always are, by negotiations between the parties. Many in the Government ranks believe Abbott is attempting to illustrate how tough he can be with unions as part of his campaign to be Peter Costello's loyal deputy when Howard is gone, or perhaps even defeating Costello for the Liberal leadership.This might be a fun game for those in the Liberal Party, jockeying for leadership of the government at the moment or for leadership of the Liberal opposition after the election, but it does naught to advance the position of industrial relations in Australia. But that is the level at which this debate has been conducted by this government. Notwithstanding the fact that it is a 13th order issue in the view of the public, the government presses on. Here we have a concept that has been regurgitated into a bill that we have seen before. As I said, it is not about democracy.If you listened to the contribution from government members, you would think that there has been an outbreak of industrial activity, that there have been strikes occurring all over the place and that we are suffering mayhem in the workplace. That is an odd position for those people to take, because they have sought to claim credit for what is a historically low level of industrial disputation. I do not know how they can, on the one hand, say that their laws have been so fantastic that they have reduced industrial disputes to levels not seen for decades but, on the other hand, say that strikes are such an enormous problem for the state of our economy and life as we know it in the free world that we have to introduce these new laws to prevent strikes occurring. You cannot have it both ways. You cannot argue both those positions, but government members have sought to do so very dishonestly. It is an improper argument and they know it. It is a slick tactic for the stupid.As I have commented in this place on many occasions, the real break in the psyche that occurred between the high levels of industrial disputation we used to have and the low levels we now have actually occurred during the accord process. That is when the psyche changed and the statistics dramatically changed. That downward trend has continued—not as fast as it did during the Labor period, but industrial disputation is now at a very low level. The government cannot argue that they need these laws to fix up some outbreak of industrial strife. They know that that is not the case, because they claim the credit for having eliminated much of the industrial disputation. They cannot claim that they need this bill because the Industrial Relations Commission needs this power and people need the right to have a secret ballot. The existing act provides that mechanism now. It is passing strange. I have heard government members say, `That's in the legislation but no-one uses it.' Because no-one uses it, they are now going to change the law to make everybody use it. This is an interesting approach to legislation. At the moment we provide a mechanism for anyone who wishes to to go to the Industrial Relations Commission and seek a private ballot. Indeed, the commission can of its own accord determine that there needs to be a secret ballot. Hardly anyone has used that mechanism. Why? Because the workers, the unions, the employers and the Industrial Relations Commission do not believe the circumstances require them to do it.The Liberal and National parties are now saying, `Even though all the people out in the workplace and the Industrial Relations Commission don't think it is necessary, we're going to legislate to make them all do it whether they like it or not.' This is not aimed at improving democracy; it is aimed at preventing industrial strikes. The member for Parkes, who spoke before, made it clear in his comments that his desired outcome is not to democratise the workplace but to prevent strikes happening. The government could at least be honest and say that. They could change the title of the bill and say that that is what it is about. Some of their speeches have made it clear that that is what it is about.The detail of the bill provides that you have to give three days notice and that that can be extended to seven days. As anyone who has been involved in an industrial environment would know, it is a bit stupid to suggest that you are going to give three days or seven days notice of what is going on. That might be convenient if you are in one corner of the fight. It is characteristic of the approach this government has taken across the board with this bill and indeed across the board with all industrial relations matters. This seeks to impose restrictions on only one side of the equation. When there is an industrial dispute, it takes two to tango. There is a difference between employees on the one side and employers on the other. What this government has done all the time and what it does with this bill is seek to tie the hands of one side of that equation, the workers. This is the case particularly for organised labour but also for the workers in general. Where are the mirror provisions in the bill that require, firstly, shareholders to have a vote before a company takes industrial action and, secondly, employers to give three days notice, which could be extended to seven days notice, before they lock someone out?I heard one of the government members the other night reading from the prepared script the minister's office had given him and trying to explain why shareholders have nothing to do with this. It was bunkum. Of course shareholders have something to do with the management of a company—if indeed this has the importance that government members want to give it. It affects the operations of companies. We have heard that it affects jobs. It affects all sorts of things according to the people on the other side—everything but the common flu and AIDS. It might well be that shareholders have a legitimate right to have a say before the company decides to initiate industrial action and lock workers out. Workers typically go on strike for a day, two days or three days. If they are on strike for a week, that is extraordinary. For someone running a company to lock workers out for a week is not extraordinary. I have cited examples in the past where companies have locked workers out not for three days but for three months. I have cited an example where a company locked its work force out for nine months—nine months without receiving one word of criticism from a single minister on the other side. Indeed, the minister of the day went on the record and defended that company in locking those workers out for nine months. If a company wants to set about locking workers out, why doesn't the government impose the same democratising principles on the company? To pick the industry that the member for Hume was in, if an abattoir like G & K O'Connor wants to lock its workers out for nine months, as it did, why shouldn't the shareholders have a ballot before that factory is closed down for nine months? Why shouldn't the company have the same obligations on it to give notice to the workers as the government wants to place upon the unions? This is not about fairness; this is not about even-handedness; this is not about democracy; it is about pursuing a very one-sided agenda in this debate. This bill does not deserve support. The Labor Party is rightly not supporting it. I hope it will be defeated in the Senate.I want to make a couple of final points before I conclude. The bill refers to the creation of a `ballot agent'. I found that pretty intriguing because I am not quite sure who the ballot agent is and what they get to do or why we need one. I am not sure that the minister has commented on that. I did not see it in the second reading speech as I had a look through it and I would be interested in hearing in his closing remarks why we need a balloting agent. I was interested in the provisions in the bill as to who can be a balloting agent. It talks about someone being appointed, other than the Electoral Commission, and they have to be capable of ensuring security of names and a few other things that you would expect to be stated. But then it actually includes a new provision, a new subsection 170NBE(4), that provides that an authorised independent adviser must be nominated and appointed if the commission is satisfied that a person nominated as the authorised ballot agent is not sufficiently independent of the applicant. So we are proposing that an agent be appointed, but that agent might actually not be seen to be independent, so we appoint another person to look over the shoulder of the agent who was looking over the shoulder of the workers while they go about their balloting. Let us be serious about this. What a nonsense! The government in its convoluted way of trying to restrict what workers are doing has, I think, been blinded.I want to refer finally to two sections of the report of the Senate inquiry that was held the last time this proposition was before the parliament. I want to quote an extract that was referred to there from Professor Ron McCallum. For some on the other side, I know Professor Ron McCallum is not their flavour of the month. It should be said, though, that he is a world recognised authority whose counsel on industrial relations matters is sought out both in North America and in Europe. He is probably our most internationally recognised industrial relations specialist. He made a submission last time this matter was before the parliament—and I am not trying to verbal him and I do not know what his views on the current bill are, but he did make these comments about the previous bill on this point of compulsory voting:... I suspect, from my long experience in labour law, that such a bureaucratic system will drop industrial action down from union executives and union secretaries to wildcat action. I think we will see an increase in short-term wildcat action, and there will be a series of legal decisions seeking to assert that wildcat action on the shop floor can be sheeted home to trade union officials. Similar case law occurred in England in the late 1960s and early 1970s, to little effect.Someone in the government might like to take heed of his advice on that point. I should say that the provision that says you can have an industrial action applying for a period of 30 days after the approval would lead any sensible union to arrange for a ballot to be carried as soon as possible in the bargaining process—and it would be carried because workers would vote for it just to make sure they had it up their sleeve— whereas, if in fact they were voting to go out on strike tomorrow, they might not. I actually think the mechanism backfires. I do not think that it achieves the aim that the government want at all. I think it will increase industrial disputes, not reduce them. That is one reason why it will increase industrial disputes. I say that, having spent a bit of time with people involved in these debates, as have a number of people in the parliament.The last thing I just want to mention is what the Democrats said last time. They said:At present pre-strike ballots are available to employees under section 136 of the Act, and the Commission can order secret ballots at its discretion under section 135. And of course, elections of union officials are by secret ballot. The provisions of 135 and 136 have apparently been rarely used, suggesting that there maybe little real demand from employers or employees for further access to secret ballots. However, the new provisions pose great dangers of actually escalating conflict, lengthening disputes, and making more litigation ... The committee heard evidence concerning the poorly designed Western Australian secret ballot laws, forced through their compliant upper house ... In short, the provisions of this Schedule add little to industrial democracy and add greatly to impediments to unions to undertake legitimate industrial action, while opening up the prospect of longer disputes and litigation. That was a view the Democrats had the last time this matter was before them. The provisions have been changed very little and I think those same criticisms apply. People opposite who enter this debate would do well to learn a little bit about it before they open their mouths.18:42:003882Hartsuyker, Luke, MPMr HARTSUYKER00AMMCowperNP10—Tonight I wish to speak on the Workplace Relations Amendment (Secret Ballots for Protected Action) Bill 2002. Contrary to the member for Brisbane, I believe this is a bill which addresses the issue of democracy and the rights of all workers, and it impacts directly on the competitive environment of Australian business. It is about restoring the rights of the individual in a democratic and progressive way by ensuring the workers' views are specifically included in any process of industrial action. I do not know why the members opposite are so concerned about workers in the workplace having the ability to cast a vote in secret to exercise their democratic right in any potential dispute. This bill is also about encouraging a more productive workplace for the benefit of employers and employees alike. It is about providing improved living standards for employees through the elimination of unnecessary strikes. It is about making provision for protected action when it is necessary, as opposed to action taken by a union at the whim of a shop steward without regard for the wishes of its members. The parliament must now consider whether this amendment will allow individuals the opportunity to freely express their opinions on conditions in the workplace, without the standover tactics, without the threat of recrimination from some sectors of the union movement. It needs to be noted that those individuals who may be subjected to such tactics are both union members and non-union members alike. The opinions of employees can of course be established through the process of staging a secret ballot of workers prior to any industrial action taking place. It is a fundamental democratic right which this amendment proposes, a fundamental democratic right which the union movement appears opposed to, and you would have to ask the questions: why are the unions opposed to democracy? Why are they opposed to their members and non-union members alike expressing their view in a secret ballot.The system which currently exists in the workplace provides protection for employees should action take place during negotiation of an enterprise bargaining agreement. As the Workplace Relations Act clearly notes, this protection is subject to certain procedural requirements and limited to situations where there has been a genuine attempt to reach agreement. Unions and employees complying with these requirements gain immunity from a host of forms of civil liability that may arise from industrial action. The 1996 act also prohibits employers from dismissing or injuring an employee in his or her employment, wholly or partly because the employee has taken the protected action. Section 170MU of the act specifically states:Employer not to dismiss an employee etc. for engaging in protected action(1) An employer must not:(a) dismiss an employee, injure an employee in his or her employment or alter the position of an employee to the employee's prejudice.The amendment currently before the parliament does not erode this incumbent level of protection for all concerned parties. However, what it does address are the inadequacies of giving all parties a fair go in order to achieve positive outcomes for those involved in any potential industrial action. As many of my parliamentary colleagues are no doubt aware, under the current act section 170MR stipulates that members of an organisation of employees cannot instigate industrial action with protection unless it is duly authorised by an organisation or an authorised person of the organisation itself. Section 170MR specifically states:(1) Engaging in industrial action by members of an organisation of employees that is a negotiating party is not protected action unless, before the industrial action begins:(a) the industrial action is duly authorised by a committee of management of the organisation or by someone authorised by such a committee to authorise the industrial action; and (b) if the rules of the organisation provide for the way in which the industrial action is to be authorised—the industrial action is duly authorised under those rules; and (c) written notice of the giving of the authorisation is given to a Registrar.With respect to secret ballots, it is worth noting the ratio of such ballots to the number of applications for bargaining periods. According to the annual reports of the Australian Industrial Relations Commission, between 1996 and the year 2001 only 12 orders for secret ballot were issued. In the same period, there were some 32,957 applications for bargaining periods. This shows how sparingly the provisions of the act are currently being exercised.The status quo has a twofold effect on the processes involved in industrial action. Firstly, because the authorisation has come from an organisation, there is no guarantee that the wishes of the group of employees are truly being reflected. Workers are effectively compelled by the act to negotiate through the rules of the union. The union is thus in a position whereby the authorisation of any industrial action is carried out on its terms and not necessarily the terms of the employees. I believe it is essential that the decision to take any industrial action is made at the workplace level by the employees directly concerned. The only way that the genuine will of those employees can be known is through a secret ballot prior to industrial action being taken. Any other way invites the bullyboy elements who represent the ugly face of unionism.Despite the maturity of the Australian economy, it is a sad reflection that in the 21st century we still have a culture in some sections of the union movement where people believe it is their God-given right to intimidate employees and their families if they do not toe the hard union line. You only have to look at some of the evidence put before the current royal commission into Australia's construction industry to understand the lengths that the thugs in the union movement will go to. It is unfortunate that the militant sections of the union may approach any person who takes an opposing view and seek to intimidate ordinary workers and that those workers should have to live with that intimidation as part of their workplace and their daily lives. I ask: what does any ordinary worker do if they know that they and their family run the risk of being threatened in their opposition to any proposed industrial action? It is a sad reflection on some unions that, in an age when we are seeking to eliminate bullying from our school playgrounds, there still exists an environment of fear being inflicted by union heavies upon ordinary Australians who are simply trying to earn a living and provide for their family, and simply trying to exercise their democratic right in the workplace. Making these Australians vote in a public forum does nothing for their democratic right. It does nothing for their ability to have their say. Make that vote a secret ballot and then the true will of employees can ultimately be measured. The current workplace relations environment also runs the risk of dragging innocent participants into this dispute. Often it is the case that one particular firm has no relevance to another firm many miles away but the second firm may be dragged into the industrial action. Despite there being two separate companies with two separate workplaces, the union movement attempts to drag company B in when the real problem exists with company A, and there may be no relevance between the two organisations. This sort of situation clearly discriminates against the rights of employees in individual workplaces to have the terms of their specific agreement considered without the camouflage of the wider union agenda.We all know that trade unions will drag the interests and goodwill of employees from one company into the industrial action being taken in another company. One only has to look at the conduct of many trade unions over time to see the ramifications of this. Industrial action by trade unions often overlooks the specific needs of the workers and is purely based on an agenda decided by a centralised, metropolitan based hierarchy which is immune to the needs of individual workers. The reality is that many of the specific concerns of employees can be resolved with management of the business and all parties can get on and be productive, get on and earn a living and get on and strike a blow for Australia—no lost work days, no lost wages, no jeopardising of existing and future contracts. Good management wants its employees to work in an environment which is going to make them the most productive.Why should a trade union impose its will for industrial action on employees of company A because of matters relating to an agreement in company B? To ensure that employees are not made a pawn in the trade union game, employees must, by law, be given the opportunity to vote on whether they take industrial action, but to vote in a secret ballot. The only way employees can do this without being personally intimidated or without the fear of being intimidated in the workplace, without the fear of recrimination, without the fear of having to toe a specific union line, is to be able to have a secret ballot at the workplace level. I agree with the view that over time such a recourse to secret ballots where protected action is an issue would contribute to developing a culture of employee involvement in the workplace and in workplace decision making. I do not know what members opposite have to fear from the thought of the exercise of democratic rights in the workplace.It is interesting to note that other developed countries across the world have already adopted similar legislation. It is not exactly the same—and the member for Brisbane always seeks to draw distinctions between what we are proposing here and that other legislation—but similar legislation has been put in place around the world. Those measures are consistent with the standards set down by the International Labour Organisation. It is the ILO's role to formulate international labour standards which set minimum standards for a whole range of things, including basic labour rights, freedom of association, the right to organise, collective bargaining, abolition of forced labour, equality of opportunity and treatment, and other standards and regulations regulating conditions across the entire spectrum of work related issues. All of these standards for workers are protected in legislation in Australia. I believe that in achieving consistency with ILO standards this bill has solid credibility and is in the mutual interests of employees and business.The secret ballot provisions in this bill are also consistent with the measures in place in the legislative instruments in the United Kingdom, Canada, Japan, Germany and Ireland. For example, section 87.3(1) of the Canada Labour Code, which was instigated in 1998, says:(1) Unless a lockout not prohibited by this Part has occurred, a trade union may not declare or authorize a strike unless it has, within the previous sixty days, or any longer period that may be agreed to in writing by the trade union and the employer, held a secret ballot vote among the employees in the unit and received the approval of the majority of the employees who voted.Sixty days: that is how it is in Canada at the moment. The Labour Code goes on:(2) Unless a strike not prohibited by this Part has occurred, an employers' organization may not declare or cause a lockout unless it has, within the previous sixty days, or any longer period that may be agreed to in writing by the trade union and the employers' organization, held a secret ballot vote among the employers who are members of the organization and received the approval of the majority of the employers who voted.It adds:(3) A vote held under subsection (1) or (2) must be conducted in such a manner as to ensure that those employees or employers who are eligible to vote are given a reasonable opportunity to participate in the vote and to be informed of the results. And it goes on and on. In the United Kingdom there have been measures in place since 1984 for secret ballots. Interestingly enough, they were retained by the Blair Labour government, which is a Labour Party actually in government at a national level. The measures were retained by the Blair Labour government in its industrial relations reforms of 1999. The Blair government has taken the very appropriate stance of not only allowing secret ballots but also addressing the legal status of ballots in which some voters have found to have been intimidated or induced into taking a particular stance. In fact, in the United Kingdom, section 232A of the Employee Relations Act of 1999 clearly spells out that the industrial action is not considered as having the support of the ballot if a person:... was induced by the trade union to take part or, as the case may be, to continue to take part in the industrial action.That act actually takes account of the fact that trade unions may seek to induce workers to take part in industrial action. We think that democracy, rather than forcing the hand of the workers, is the way to go. Having workers being able to exercise their free will is the best way to go forward and the best way for productivity. This point demonstrates that, across party lines, secret ballot provisions are sensible and constructive. The UK Minister for Employment and Workplace Relations noted that those provisions have the support of union leaders in that country; and that is interesting to know.However, I am sure that, in keeping with the traditions of the Australian Labor Party, the members sitting opposite are feeling rather squeamish about these changes. No doubt they are under pressure from the unions—whether they be the 60-40 unions or the 50-50 unions; I am not sure which—to go down yet another path against job productivity, business, economic growth, commonsense and democracy. The experience in the United Kingdom of having these provisions has been a significant reduction in strike activities, the secret ballot having given union members a direct say in the authorisation and conduct of industrial action. I have said it before: how can members be free to exercise their democratic right without that secret ballot?The Workplace Relations Amendment (Secret Ballots for Protected Action) Bill 2002 is a progressive step, and one which will provide for improved productivity and democracy and will allow workers to have their say. It is great for employees, employers, the business environment and the productivity of this country. I certainly commend this bill to the House.18:57:003885Mossfield, Frank, MPMr MOSSFIELDMK6GreenwayALP00—The purpose of the Workplace Relations Amendment (Secret Ballots for Protected Action) Bill 2002 is to amend the Workplace Relations Act 1996 to require the conduct of a secret ballot by union members and non-union members as a prerequisite for gaining authorisations from the Australian Industrial Relations Commission to take protected industrial action against an employer during enterprise bargaining negotiations. The Bills Digest states:This is to ensure that those participating in the action have decided upon the action and have not been misled by union officials.That is an unfortunate phrase. The Bills Digest does a great job in preparing legislation briefs for us members, but it seems as though that is taking a misleading position in prejudging what might happen. It is, unfortunately, suggesting that this legislation is necessary because union officials mislead their members. As an ex-union official—and there is another one sitting at the table—I can say that we simply do not. It is a different environment and culture. We do have a show of hands, but everyone has a say and there is no pressure applied. It is a different but interesting democratic culture.It is an insult, nevertheless, to say this. It ignores the fact that, in effect, employers have more opportunity to mislead their own employees than union officials do. I am not saying that employers do necessarily mislead, but they certainly have greater opportunity to influence their employees than union officials do. Employers have unfettered access to their employees during working hours and they have the power to hire and fire, which is a great influence over their own employees. They have far more opportunity to mislead than do union officials. I use the word `mislead' in the same context as `influence', and that is what happens.This legislation shows that the government are pursuing a very biased industrial relations agenda and using this as a political tactic to demonise unions and union officials, in the same way that they have demonised refugees, unemployed people and people on disability support pensions. It appears that the government demonise any group they want to attack before they attack them.This type of legislation was first proposed in the Workplace Relations Amendment (Less Secure Employment) Bill 1999. At the same time the 1999 budget introduced funding for the partial cost of conducting these ballots, assuming of course that the balance of the cost would be borne by the applicant union. The bill, nevertheless, failed the Senate. The government then introduced schedules of this bill as a series of separate bills and thus the Workplace Relations Amendment (Secret Ballots for Protected Action) Bill 2000 was introduced into the House of Representatives and then referred to the Senate, where it suffered the same fate as the earlier legislation. This is a case of try, try again and, if it does not work, then hit somebody over the back of the head with a cricket bat.The biased nature of the government's industrial relations agenda can be seen by the comments of the current minister for union bashing, the member for Warringah. When speaking of this legislation, he said:It will ensure that the right to protected industrial action is not abused by union officials pushing agendas unrelated to the workers at the workplace concerned.Only a very creative mind or a mad conspiracy theorist would envisage a situation where workers would be prepared to lose wages over issues unrelated to the workplace. I do not want to accuse the minister of having a creative mind. The proposals in this legislation, however, are unnecessarily complex. A discussion paper on the implementation of the Orwellian named Workplace Relations Legislation Amendment (More Jobs, Better Pay) Bill 1999, released by the previous minister for children overboard, stated: Protected action will be preceded by a secret ballot process overseen by the AIRC. Ballots will normally be conducted by post, although applications may be made for attendance ballots in appropriate circumstances. An application for a secret ballot will only be able to be made during a bargaining period and will be required to include a range of information, such as the proposed certified agreement to which a secret ballot relates, the group of employees or members who are to be balloted, and the question or questions to be asked in the ballot. The AIRC will be empowered to determine whether a ballot should or should not proceed. Before ordering a ballot the AIRC would need to be satisfied that, among other things, the parties have been genuinely bargaining.Members of organisations making agreements (or the employees to be covered in the case of non-union agreements) would be eligible to vote in a ballot.Are there any questions so far? Does anyone follow it? I must admit that I am a bit lost. The point not covered in this statement by the then minister for workplace relations is: if it is necessary to hold a secret ballot to determine if industrial action should take place, it obviously follows that it is necessary to hold a secret ballot to determine if and when a resumption of work should take place. One goes with the other. If there is a secret ballot and people make the decision to go out in dispute, how do they know when to return to work? They have to have another ballot—a postal ballot, I guess. If that is the case then would the 40 per cent quota apply, as the legislation states? What would happen if the people in dispute did vote to return to work but then only 37 per cent voted? Do they stay out? It is total confusion.Another point not answered is this: what happens if the employer is not genuinely bargaining? The most likely cause of industrial action is in fact the employer not bargaining in good faith. If there is no genuine bargaining, the AIRC, it seems, cannot order a secret ballot. You would have the AIRC denying an application to take industrial action precisely because the employer is not bargaining in good faith. It is typical of the twisted logic of this government when it comes to workers' rights to withdraw their labour. Clearly the government's industrial relations agenda is complementary to its political agenda.The trade union movement has critical ties with the Australian Labor Party. We are proud of this. This is a piece of Australian history. It began years ago, when the working people of this country determined that they wanted a political party to look after their interests. I believe that this is a piece of history that the Liberal Party is jealous of. But the relationship is pragmatic more than dictatorial. History has shown that at the end of the day, after due process, Labor governments do what they consider is in the best interests of the country or the state. Labor governments are not dictated to by any particular group or the trade union movement. For example, who would claim that the sale of the Commonwealth Bank or Qantas or the recent changes to workers compensation in New South Wales were policies advocated by the trade union movement? Certainly nobody in their right mind would. There were differences of opinion and of course the Labor government introduced what they thought was the appropriate legislation at the time.The trade union movement does have an influence—there is no question about that—but not exclusively. More importantly, I would suggest, employer organisations and organisations such as the National Farmers Federation have far more influence over Liberal and National Party policy than has the union movement over the ALP. There is a definite double standard in Australian politics when it comes to the union movement and the ALP: it is perfectly reasonable, it seems, to have an NFF controlled National Party in charge of agriculture and trade policy, but there is outrage when a union official says anything remotely connected with industrial relations.If you want a conflict of interest, you need to look no further than the member for Wide Bay, a farmer who is the minister for agriculture. Let me make it clear: I am not having a go at the minister for agriculture, I am simply pointing out the double standards that exist in this place. The minister for industrial relations might also take a glance along his own frontbench. One of his colleagues is an ex-president of one of the most militant trade unions in the country. I am referring to the member for Bradfield, who is the current minister for education and an ex-president of the AMA. Of course they do not call themselves a union, so they are all right! Maybe if the AMWU changed their name to the AMWA, the minister would stop abusing them, but I doubt it.The Minister for Employment and Workplace Relations—who does not actually believe in workplace relations, just workplace dictatorships—has continually abused the processes of this House to attack members of trade unions. What he fails to understand is that trade union officials are people just like those in any other profession—doctors, motor mechanics, builders labourers—who have families, who live in communities, who are members of clubs, churches, sporting teams and so on. They are people who have spent many years on the factory floor or in the office or in their particular profession doing their training, their apprenticeship and mastering their trade or profession before moving after a period of time into the trade union movement to represent their members. Since that time they have spent every working day trying to get a better deal for their fellow workers, battling on behalf of their neighbours and colleagues, their friends and complete strangers, protecting their rights and improving their lot. I am proud of the work performed by unionists and I make no apologies for it. What has the minister done himself except denigrate and pour scorn on ordinary people, on ordinary workers and on the trade unions' efforts to help? There is another double standard at play in Australian politics. The minister would have you believe that everybody on Labor's front bench is an ex-union official. He might be interested to know that there are 10 ex-union officials on the front bench of the opposition out of thirty—that is, about 30 per cent. You could include a further three who have worked for the trade union movement but were not an official of a union. That takes the percentage up to 43 per cent. The minister says that that is outrageous, that that is domination by the unions. What does he say of his own frontbench and his own profession? Nothing, of course. The truth is too embarrassing to mention. Let us have a look at the figures. Of the 30 ministers in the Howard government, 17 are lawyers. That is 57 per cent. Whichever way you cut the cake, there are more lawyers on the front bench of the government than there are unionists on the front bench of the opposition.The minister likes to talk about union representation in the Senate on the Labor side. Maybe the minister would care to consider the fact that of the 10 ministers in the Senate eight of them are lawyers—that is, a whopping 80 per cent of their Senate frontbench are lawyers. Talk about domination! It is rank hypocrisy on the part of the minister and the government to damn our side for its union involvement while the government benches are jammed packed with lawyers. Of course, as the old adage goes, if you put 17 lawyers in a room you will get 43 different opinions on a particular case. It is interesting to note that the 11 lawyers on the government's backbench justice committee managed a win over the 17 lawyers on the government's front bench when it came to the antiterrorist laws, forcing the amendments we will soon be seeing. I could say that some lawyers are bad, just as the minister says—I have not heard him actually praise any unionists, so I am assuming that he thinks all unionists are bad—that all unionists are bad. I would probably have more support for my statement than he does for his, but I would also say that all generalisations are bad and the minister needs to stop using them.I might also point out that, while there are a number of ex-union officials on our side of the chamber, there is also an incredible diversity of experience. We may be former union officials, but we also had careers prior to becoming union officials. We have teachers—the member for Brisbane who spoke before me from this side was a school teacher—engineers, builders, transport workers, metal workers and clerks, and we have people from a dozen other professions across every industry and from all facets of the community. That would make us, I believe, probably more representative of the community than the domination of lawyers on the other side of the House. The breadth of workplace experience is something that the government side of the House can only envy, and what they cannot possess or cannot understand they try to destroy. They are the true Luddites of Australian politics.This bill is unworkable and it only serves to deny the rights of ordinary workers to withdraw their labour if they so choose. The right to strike is a basic right for every worker and the government's attempt to take away this basic right will come to nothing. This bashing of unions, in particular, by the minister—although the few speakers from the government side that have spoken in this debate this afternoon also appear to hold a very biased view of the union movement; I think it is based on ignorance; it is probably because they have never been involved in a union activity or been a member of a union and therefore speak through ignorance—will not succeed, because the hard-fought gains won by the union movement over more than a century of hard work on behalf of every worker in Australia will not be taken away easily.What the minister and the government fail to understand is that unions are an integral part of our society. They are an inevitable by-product of the government's economic rationalist version of capitalism. Their system allows employers to run roughshod over workers. Their playing field is not level: everything is shifted in the direction of the employer under this system. Workers, if left on their own, inevitably lose out while the government and this minister sit on the sidelines and cheer. Unions help to even the score. If employers never tried to rip off workers, if employers always looked after the health and safety of their employees while at work, if employers always dealt fairly and equitably with their workers when it came to wages, there would be no need for unions. But the sad reality is that employers do not always do this. Unfortunately, the government's legislation encourages them to be overly severe on union membership and union members' rights to protect their wages and conditions. Of course, not all employers are bad, and I can say that as a union official for over 27 years. More often than not, most employers are good employers—you do get the odd bad ones and I might just deal with them in finalising my speech. A lot of employers do deal fairly with their workers and they do look after their occupational health and safety. That is why those workplaces do not have union issues to contend with.The unions step in only when conditions are threatened. When Rio Tinto sacked 190 coalminers at Hunter Valley No. 1 without any word of warning and without any proper process, the union stepped in. The union was vilified by the government for doing so but it fought, it won the case and then had to keep fighting the appeals. After a three-year battle, only this month the union won a settlement for its members. Individually the members who had been unfairly dismissed—and remember they won the case initially—could not have kept fighting the case by themselves. Rio Tinto is a huge corporation and it was willing to spend millions of dollars appealing the umpire's decision. Individual workers who have just been sacked are not in that kind of position: they do not have the millions of dollars that Rio Tinto has to fight cases like this on their own. They need help, and where are they going to get that help? I will answer that by simply saying that without the union Rio Tinto would have gotten away with it. Unions have created a great legacy in this country for workers. We no longer live in a feudal society where workers are chattels to be used and discarded on a whim. Unions have fought for over a century, winning the rights and entitlements of ordinary working men and women. They should be congratulated, not vilified. The standard of living we experience in Australia today is a direct by-product of the union movement. The conditions and wages that workers currently have, which give us our standard of living, are the result of the actions and hard work of unionists and the union movement. Any attack on the union movement is an attack on the standard of living of ordinary Australian families, and the Minister for Employment and Workplace Relations knows this. For all his rhetoric and his Orwellian newspeak, I believe this minister for workplace relations is firmly entrenched on the side of the employer, to the detriment of ordinary Australian workers.This bill is unworkable, and I have a sneaking suspicion that the minister knows this. He is a student of elections and electoral processes and he must know that, in terms of outcomes, postal ballots are among the most inefficient and unreliable forms of voting methods. A postal ballot will take an inordinate amount of time to conduct. By the time you request a ballot from the Australian Industrial Relations Commission, prepare the papers, post the papers, give the members a chance to fill in their vote and to post the ballot papers back, and then count the ballot papers, you are looking at a couple of weeks at least. Then there would be the same lengthy time in order to end the industrial action as well, so you would see the dispute protracted far longer than necessary. (Time expired)19:19:003889Bishop, Julie, MPMs JULIE BISHOP83PCurtinLP10—I was just having a discussion with a group of my colleagues in the office of the member for Aston and we were discussing this bill, the Workplace Relations Amendment (Secret Ballots for Protected Action) Bill 2002, as one does at the end of a long day. One of my colleagues alluded to matters of justice and democracy, and it reminded me of a most apposite quotation that I came across in some recent reading. It was actually by an American theologian, Reinhold Niebuhr, who wrote at the height of the Second World War in the publication Children of Light and Children of Darkness:Man's capacity for justice makes democracy possible, but man's inclination to injustice makes democracy necessary.This reflection is never truer than when applied to industrial democracy, for injustice is endemic in trade unionism. A number of members of this parliament have already related to the House some of the shocking evidence that has been given to the royal commission into the building and construction industry of violence, intimidation and corruption on the part of trade unions, particularly in my state of Western Australia. Members had the opportunity to consider this matter at length during the recent debate on the Workplace Relations Amendment (Prohibition of Compulsory Union Fees) Bill 2002. We have also had the opportunity to hear about the bloody factionalism within the manufacturing workers unions in Victoria. Yet the problem of union thuggery and violence goes beyond simply the politics of the present and the frustration that union officials obviously feel given the third failure of the ALP to reach the treasury bench and the growing threats to their influence within that organisation. Violence and intimidation and the standover as tactic lie at the heart of trade unionism itself. The threat of violence cannot be separated out from unionism; it is its very essence.Since the very beginning of industrial militancy, violence has powered unionism as ideology, and that violence has been aimed not just at those persons taken to be the representatives of capital but at fellow workers who refuse to accept that ideology. Intimidation, coercion and violence are woven into the very fabric of the red flag. For too long in this country we have been inclined as citizens and as legislators to excuse violence that would be reviled in any circumstances other than in the workplace. It is to Australia's shame that the history of workplace relations in our country is littered with 100,000 examples of men and women subjected to harassment, intimidation, violence and genuine threats by thugs in trade union clothes. These crimes, whether petty or heinous, have been excused by the recourse to `social justice', the sacrifice of the individual to the mob: the conscientious objector stripped of his livelihood, his family terrified, his person harmed. Surely enough is enough! In this regard I could do no better than quote the Minister for Employment and Workplace Relations, who noted in a recent address to the Australian Industry Group in Canberra:... the rule of law is the essence of a civilised society and the law must apply equally behind the factory gate as it applies in the street outside. This idea that something is not an offence because it takes place in the pursuit of an industrial dispute or because it has an ideological context is just wrong. Criminal behaviour is criminal behaviour. Breaking the law is reprehensible and it is always breaking the law, regardless of the context in which it takes place.The minister went on to say:The idea that industrial disputes are somehow different, that you can do things in an industrial dispute legitimately that you would never do in any other context, is wrong, and it is reminiscent of the old attitude that we used to have to domestic violence—that it somehow wasn't really violence. Well, thank God, we've grown past that. We need to do the same growing up when it comes to industrial law.Since 1996 this government has implemented reforms to set right those wrongs and to confront this crude Marxism. It was in that year that the public got an eyeful of the union violence before the doors of this very parliament. Aggrieved at the March election landslide against the Keating government, these thugs—drunk on alcohol and ideology—rioted, trashed the forecourt and the building, terrified families and children, attacked the police and officers of this parliament and sought to intimidate the elected representatives of the Australian people. And the ALP winked like a criminal matriarch excusing the crimes of her children. Nearly 12 months ago we saw the thugs of the CFMEU attack the former Minister for Defence at a Newcastle shipyard, smashing car windows and panels with wooden batons. These criminals had decided, in the words of their spokesman, Bob Cochrane, to give the minister `a bit of a send off'. The member for Forde will recall what a wonderful weekend 14 July was, when the Aston by-election took place.6K6Elson, Kay, MPMrs Elson—History was made, again.83PBishop, Julie, MPMs JULIE BISHOP—History was made. On that weekend the Weekend Australian noted:The ugly scenes came on the eve of today's crucial by-election in the federal seat of Aston where Kim Beazley is trying to distance Labor from the alleged union violence in Melbourne.When asked why it had committed these acts of violence, the union claimed provocation. The then minister had provoked the violence by attempting to leave via a rear entrance to avoid their picket at the front. This action was, according to Mr Cochrane, `like a time bomb—people just lost it'. This is the kind of inclination to injustice that necessitates genuine industrial democracy, and only the secret ballot can guarantee genuine industrial democracy. I do not have to go through the headlines of all of the news clippings: `Workers behaving badly', `Unions start to play hard ball', `Union behaviour embarrassing the ALP'—it goes on and on.The Workplace Relations Amendment (Secret Ballots for Protected Action) Bill 2002 will guarantee the right to genuine democracy in the workplace and in turn will prevent unnecessary strikes. It will ensure the exercise of freedom of choice for workers and it will make unions and their officials accountable to their members. More importantly, the bill will shield from thuggish intimidation conscientious objectors to industrial action. As members would be aware, Australia has made provision for secret ballots at the federal level of industrial relations for some time. However, such ballots have not been a precondition for the taking of industrial action. As the minister noted in his second reading speech on this bill, the Workplace Relations Act 1996—and industrial relations law more generally—provides protection against civil liability on the part of industrial action associated with workplace agreements. Given this legal privilege, it is entirely appropriate that a secret ballot of workers be conducted before a strike is launched.This is not an onerous requirement. This is not the 1890s any more, regardless of the capacity of the opposition to live so comfortably in that imagined past. Secret ballots can be organised efficiently and with dispatch. This is not an unheard of requirement in an international context. Secret ballots in workplaces exist in the Republic of Ireland, Canada, Japan and Germany. They also exist in the United Kingdom and have done so for about 18 years. The British Labour government led by Tony Blair supports secret ballots and the British Trades Union Congress, the equivalent of the ACTU, has acknowledged the significant role of secret ballot provisions in ensuring proper industrial democracy.The bill before the House follows bills passed by the House in 1999 and 2000 and will allow unions, or an individual employee who is a negotiating party, to make an application to the Industrial Relations Commission up to 30 days prior to the nominal expiry date of a current certified agreement, provided a bargaining period is in place. The IRC will then be required to make a determination on those applications within two working days. Where the application is made by a union, only the union members whose employment would be covered by the agreement in question would be entitled to participate in the ballot. In the case of employees seeking a non-union agreement, the vote will be available to all employees whose employment would be covered by the proposed agreement.This bill allows for action to proceed where the ballot is successful and at least 40 per cent of those eligible to vote do so. The action may take place within 30 days after the declaration of the ballot or the agreement's nominal expiry date, whichever is the later. This represents a substantial change from the provisions of the 2000 bill. While the applicant may conduct the ballot with the significant financial assistance of the Commonwealth, it is necessary that the ballot be seen to be free and fair. As such, the bill does require that the IRC appoint an authorised independent adviser to oversee the process. Where complaints are raised about the conduct of a ballot and those complaints relate to matters that affect the ballot outcome and involve serious charges such as fraud, they will be investigated and justice upheld. Protection will also be afforded by the requirement that at the completion of the ballot both the authorised ballot agent and the independent adviser will forward to the industrial registrar a written report.This bill is good law. It addresses a need and it corrects an injustice. It implements a policy initiative twice endorsed by the Australian people at federal elections. It deserves the support of all members of this House, not just the government. It is fundamental to our notions of democracy and justice and, while it deserves the support of all members of this House and the government, it should also be afforded passage through the upper house. I commend the bill to the House.Debate interrupted.Adjournment389110000SPEAKER, TheThe SPEAKER—Order! It being 7.30 p.m., I propose the question:That the House do now adjourn.389119:30:003891O'Byrne, Michelle, MPMs O'BYRNE84SBassALP00—I wish to draw the attention of the House to a most exciting plan to provide Launceston and north-eastern Tasmania with a state-of-the-art aquatic centre. The aim is to provide a multipurpose leisure centre that meets the needs of a broad range of people from across the region in the areas of recreation, health, fitness and competitive sport at the club level. Its focus will be on providing leisure and recreation opportunities, complementing but not competing with the Hobart Aquatic Centre. The health and wellbeing of Australians should be a major priority of every government, whether it be at the local, state or Commonwealth level. There has never been a shortage of evidence that a healthy and fit population significantly reduces the pressure on the public purse. I become increasingly concerned for the future of both the nation and its individual citizens every time I hear or read of increasing rates of obesity in children, declining participation rates in sport and recreation, and the threat to leisure activities because of public liability insurance and the like.849Sidebottom, Sid, MPMr Sidebottom—Hear, hear!84SO'Byrne, Michelle, MPMs O'BYRNE—I welcome the member for Braddon, who I know supports this as well. In my electorate of Bass and the greater northern region of Tasmania there is an additional need for appropriate aquatic facilities, especially those facilities that provide for the acquisition of water skills. The whole of our region has no point of land which is more than 80 kilometres from the sea and it also contains a large number of rivers, lakes and other watercourses. Learn to swim campaigns, the acquisition of lifesaving skills and the opportunity for people to maintain these skills have always been an important feature of the life education of most Tasmanians. We, as representatives of the people, must be proactive in ensuring that every community has reasonable access to appropriate sport, recreation and leisure facilities. Alternatively, when a community makes a reasonable proposition, we should look to provide it with all reasonable support.In 2001, the Launceston City Council completed a comprehensive business plan comparing four different facility options, utilising a steering committee of state government and community representation. In August the council determined that it would seek to build a new indoor aquatic centre in Launceston within five years, adopting a regional model as the preferred option. The estimated capital budget was $17.2 million, based on October 2000 dollars, plus $750,000 in fit-out costs. The council resolved to commit $8 million towards the project, subject to securing regional support and a multilateral funding agreement with all levels of government.In late 2001, the Northern Tasmanian Municipal Organisation, a cooperative comprising all local government bodies in the northern region of the state, requested its recreation committee, with assistance from the state office of sport and recreation, to produce a regional aquatic strategy. The completed strategy calls for a hierarchy of facilities, including a regional centre in Launceston complemented by district facilities at Deloraine, Scottsdale, George Town and St Helens and supplemented by local community facilities. In December 2001, the Northern Tasmanian Municipal Organisation ratified the strategy, indicating the breadth of community support for the centre and the approach to be taken to the project. In April of this year the state government matched the council's allocation to the project of $8 million, on the proviso that the federal government matched the commitment also. The Launceston City Council is currently preparing a development plan for its preferred site for the aquatic centre, seeking to consolidate and integrate several key sporting facilities into a major sporting and recreation precinct for the city and the region. This will maximise both the social and economic benefits of the investment for the northern Tasmanian community.There are many reasons apart from the ones I have already mentioned as to why this admirable proposal should be given the green light. The latest research undertaken by the NTMO Recreation Committee at the end of 2001 indicated that 65 to 85 per cent of Greater Launceston residents would potentially use the new centre. Whilst swimming is one of the top three recreational pursuits in Tasmania behind walking and fishing, the regional aquatic strategy report indicates clearly that swimming participation in the north is declining, owing to a poor standard of facilities and a lack of access to appropriate facilities. Of the 11 remaining council pools, eight are more than 35 years old and none is open in winter. The result is particularly dramatic in the case of older adults, with the lack of a heated indoor water space resulting in one of the lowest participation rates by older adults in water recreation and therapy in Australia. Access for people with disabilities or mobility problems and for those requiring accident rehabilitation is also severely limited. The poor quality of pools in northern Tasmania is impacting on the standard of swimming being attained by northern school students. According to statistics from the education department, only 40 per cent of primary students attain the national benchmark by the time they finish the water safety program. I commend this fine proposal to the House and urge the government to join with the Launceston City Council and the Tasmanian state government in making this wonderful new facility a reality.389319:35:003893Elson, Kay, MPMrs ELSON6K6FordeLP10—I rise tonight to do something fairly unusual, but my colleagues will know that I am the sort of person who gives credit where credit is due. Tonight I want to thank the Queensland Labor government for their decision to implement a trial of seatbelts in school buses, as they announced in their budget this week. I see this as a step in the right direction. It is only one small step, but it is still better than the stonewalling we have had to date. Members may recall that last year I presented in the parliament a private member's motion calling for the state government to legislate for the compulsory fitting of seatbelts in all new buses. I canvassed the many safety reasons that we have compulsory fitting of seatbelts on all long-distance coaches. It really makes you wonder why we still leave the most precious cargo of all—our schoolchildren—unprotected.I have had an enormous amount of support from the community on this issue, with more than 500 local residents signing a petition to the state government. I am very fortunate to have two remarkable women in my electorate, Kim Bax and Kim Limberg, who have been tireless campaigners for school bus safety and the fitting of seatbelts on school buses. Kim and Kim came to Canberra at their own expense and met with many advisers when I moved my private member's motion last year. I congratulate, thank and pay tribute to them for their ongoing efforts. They are truly community-minded people who believe wholeheartedly in the issue and want to ensure that children in the future can travel to school more safely. That the Queensland government has agreed to implement a trial of seatbelts is largely due to the untiring efforts of the `two Kims', as they are known throughout the district. I know they will keep up the fight and I look forward to continuing to work with them. It looks like we will have our work cut out for us for, although the state government has agreed to a trial of seatbelts on 10 school buses, there was another initiative announced in the budget that has me a little puzzled. The state government has earmarked $16.7 million for a scheme to replace old school buses on non-urban routes over the next four years. On the face of it, that is a very positive measure, and I welcome it. But there is a catch: there is no requirement for these new buses to be fitted with seatbelts. I certainly hope that the state government is planning to examine the results of a properly conducted seatbelt trial, involving schoolchildren of all ages—not just children of high school age—before it goes ahead and spends that much money on replacing old buses with new ones that are still not fitted with seatbelts. It seems ridiculous that the Queensland government would want to buy new buses that are not fitted with seatbelts, especially when the New South Wales minister is apparently proposing to call for the fitting of seatbelts in all new school buses at the next Australian transport ministers conference. There is a huge amount of research that points to the value of seatbelts on buses. I would hope that the results of a trial would be properly examined before new buses are purchased.If commonsense prevails, the next step will be to at least legislate for all new replacement school buses to be fitted with seatbelts. This would surely be the focus of the state government's replacement scheme over the next four years. I think Kim Limberg was absolutely right when she said recently:You would think the smart state would be the first to implement seatbelts on new buses, not sit back and wait for another state to introduce them first.I call on Mr Beattie to ensure that the seatbelt trial is not just a stunt and that the Queensland government does not waste close to $17 million buying new school buses that are not fitted with seatbelts. I am hopeful that commonsense will prevail. Let us make sure that these positive steps in the right direction are followed through so that we do not have to continue to debate this issue over the next 10 years. It simply makes sense to ensure that all new school buses are fitted with seatbelts. Anything less is continuing to compromise the safety of our children.In the few minutes remaining, I would like to also congratulate a very special lady in my electorate, Delaune Pollard. She is coping with many personal challenges of her own, but she has taken the time to launch a book titled Midlife challenge. It was launched by the Minister for Ageing, Kevin Andrews, last week in my electorate. It is a book about understanding and coping with the decline in thinking and behaviour in ageing persons. Delaune wrote:Like me, so many of my friends and colleagues now in their middle age have experienced or are experiencing emotional turmoil as they add another significant responsibility to their already busy and committed lives.That responsibility is assisting and caring for aged relatives. She goes on to say:For me, taking on this role coincided with a series of crises in my life—This left her very vulnerable and fragile. As an occupational therapist and studying cognate therapy, she wrote about her experiences, which took her a fair amount of time. It is the most commonsense book that I have ever read. I would like to conclude by congratulating Delaune Pollard and recommending her book. (Time expired)389419:40:003894Sidebottom, Sid, MPMr SIDEBOTTOM849BraddonALP00—The member for Forde is to be congratulated for her work, and the Queensland government, on seatbelts in school buses. I was happy to second that motion in this House some time last year, if I remember correctly. It is great to see some young people in the gallery tonight. I welcome them. It is very interesting that the member for Forde brought up the issue of safety for young people, because that is the very issue that I want to talk about. Last time we were in this House, I mentioned that my son would be turning 16 next Wednesday. That is great news, but the other news is that he is going for his learner's licence. That brought to my attention the whole question of novice drivers and their record on our roads. I love young people, but unfortunately the statistics show that young people are very prone to accidents on the road, particularly in relation to their driving skills and speed. I will share the statistics with my son when I see him for two days over the weekend, but I would also like to share them with the House tonight. These statistics are in light of my earlier comments on the lax advertising standards in terms of the code for road safety. I would like to acknowledge the very positive work of Senator Boswell in trying to tighten the guidelines on advertisers' use of speed in vehicle ads. Between 1995 and 1999 in Tasmania, my home state, novice drivers—that is, drivers between the years of 17 and 19—made up nearly seven per cent of road fatalities and injuries and, together with their passengers, made up 11.6 per cent of the road toll. In all, 19 per cent of the road toll involved novice drivers. Drivers aged less than 25 years made up 39 per cent of the overall road toll. Statistically, novice drivers are overrepresented, unfortunately, in road crashes. In 1995 to 1999 they comprised 12.6 per cent of all drivers in casualty crashes but only accounted for four per cent of the population, 3.8 per cent of all licence holders and 1.7 per cent of all the kilometres travelled. Data indicates that novice driver crashes were very similar to the crash patterns of mature drivers—we age them between 25 years and 64 years—but they were more likely to have been judged as follows: responsible for their crashes, 68 per cent compared to 31.9 per cent of mature drivers; involved in crashes attributed to inexperience, 13.4 per cent as opposed to 1.8 per cent; and speeding, 10.4 per cent compared to 6.7 per cent. They were more likely to have been judged to have been involved in crashes late on Fridays and Saturdays and early on Saturdays and Sundays—18.6 per cent compared to 9.4 per cent. The fact is that they are out and about. They are having a good time, but unfortunately the statistics in terms of casualties are very disturbing. They are more likely to be in single-vehicle crashes—36.3 per cent compared to 25.4 per cent. Those involving collisions with roadside furniture—that is an interesting phrase—and overturning is 32 per cent compared to 19.8 per cent of mature drivers, and carrying passengers at the time, statistically 50 per cent compared to 36 per cent. Over two-thirds of novice drivers had their crashes in a 60-kilometre-per-hour speed zone. Unfortunately, like the mature driver cohort, the majority of drivers involved in casualty crashes were males—63 per cent for the novice drivers and 60 per cent for mature drivers. Why is this so in our community? Clearly we have to do everything we can to make motoring safe and enjoyable for all drivers. However, for everyone involved it should be safety first and enjoyment second, and not the other way round. I am not sure this is the message, however, if we take vehicle advertisements literally. To see an ad that depicts as funny a driver speeding down his home driveway, between objects, including toys, with his child laughing gleefully at him, when we have the highest casualty rates off roads—that is, in driveways—in the world, tells us a lot about what our community says about its standards. I hope that code changes and very quickly, because I want my son to come home every night when he has been out driving. 389519:45:003895McArthur, Stewart, MPMr McARTHURVH4CorangamiteLP10—Along with you, Mr Speaker, and the member for Braddon, I would like to welcome the 65 students from the heartland of Corangamite. They come from the primary schools of Meredith, Lethbridge, Anakie, Inverleigh and Teesdale. It is the biggest adjournment speech audience that we have had in the 40th Parliament, and they have come all the way from Corangamite to be here. They have observed you in action today, Mr Speaker, during question time. They were perfectly well behaved in the gallery. They did not speak, and they did not misbehave like some members of the parliament do!They saw the Treasurer, the Hon. Peter Costello, defend quite vigorously the government on the Pharmaceutical Benefits Scheme. It is a very important policy position where a copayment is being proposed to increase the cost of prescriptions from $3.60 to $4.60, and after 52 scripts, as these young people understand, pharmaceuticals will be free. The students reported to me that the proceedings were lively. They also suggested that you did have control of the proceedings at most times!If they had been here earlier this week, they would have heard a report from the Prime Minister on his visit to America, where he met President Bush, Vice President Cheney and most other senior leaders of the US administration. They would have heard the Prime Minister talk about the US farm bill and its impact on the farmers of Meredith and Corangamite. There was also the Prime Minister's observation that undue influence in the US Senate, with two senators per state from the Midwest, made sure that the US farm bill, which is so detrimental to the farmers of Corangamite and Australia in general, was passed—very much to the disadvantage of all Australians. The Prime Minister also spoke to the US House of Representatives on behalf of all Australians, and that great honour of speaking to the House of Representatives is not bestowed on many leaders.Those young students in the gallery had their own parliament back in Meredith. They had a debate on the topic `Homework was essential'. On that occasion, Brigitte Gargan from Meredith was elected as the Prime Minister and the Leader of the Opposition was John Collins from Inverleigh. They had a very interesting debate, and they spoke well. They behaved well under Speaker McArthur, who kept control of the gathering, and no member was suspended! You will be interested to know, Mr Speaker, that the government won the vote with 31 votes compared with the opposition's 30 votes.Those young students come from Corangamite, as I said, where their parents run wool and cropping, globulus gum tree operations, cattle and fat lambs. In the last year or so, times have been prosperous around Meredith, Teesdale and Inverleigh. We have had good rains and good prices. These schools are located in the Golden Plains Shire. It is the second fastest growing shire in Victoria. It is south of Ballarat and Bannockburn. The lifestyle is excellent, and people like to come and live in the Golden Plains Shire. The Teesdale school is a mud-brick school. It is environmentally friendly and the heating is particularly good. It is a very good little school, and I have been there. At Anakie, they have one of the best wine regions in Australia. It is much better than the Barossa Valley, where the Speaker comes from!10000SPEAKER, TheThe SPEAKER—Order!VH4McArthur, Stewart, MPMr McARTHUR—The wine from Anakie is much better! I would just like to draw the attention of the House to that.Inverleigh school is a little bluestone school, which has had some improvements. It started in 1874 on the Hamilton Highway. Lethbridge is the centre and the focus of the Golden Plains Shire, and we are hoping to get a new school there in the very near future. Meredith is the home of the former premier Sir Henry Bolte, who was the Premier of Victoria for 17 years from 1955 to 1972. My close friend Mr Tom Austin, who died last week, was also born at Meredith. He was a cabinet minister in the Hamer and Thompson governments and was a confidant of Premier Kennett. When he died, his daughter said that he wanted to come back in the next life as a black duck and fly over my property at Meningoort at Camperdown because he knew that I was such a bad shot that he could fly for evermore! We welcome our young students here to Canberra. They have seen the parliament in action and democracy at work. It has been a vigorous and open debate. We may have a premier and a prime minister amongst those young people. We wish them well and we are delighted they are here. (Time expired)10000SPEAKER, TheThe SPEAKER—I join the member for Corangamite in welcoming the students from Corangamite. They are fortunate to have the opportunity to hear not only the member for Corangamite but also the members for Forde and, I suspect, Canning, Bass, Stirling and Braddon.389619:50:003896McFarlane, Jann, MPMs JANN McFARLANE83CStirlingALP00—Mr Speaker, as you are aware, there was a rally outside the House today attended by people with disabilities, their carers and family members, and workers from the disability field and other community groups. They were here because of their concerns about the government's intention with the budget to change the criteria for the disability support pension by reducing the work hours from 30 hours to 15 hours, which means, if the government goes ahead with this, that many people will lose their pensions. As well, they wanted to express their concern over the government's intention in relation to the PBS to increase the copayment by $1.I would like to take this opportunity to read to the House a letter from one of my constituents. Mrs Willy Fisher is the mother of Jodi Fisher, whose family featured in a front page story in the West Australian newspaper on 22 May 2002 entitled `Pensioner family bear brunt of Budget'. The article outlines the fact that the Fishers will be $180 per fortnight poorer under the government's proposed policy to change the criteria for the disability support pension. They will lose more than $1,000 a year in cancelled disability concessions, leaving them in total $6,000 poorer a year. I read with disgust some of the letters to the editor in the days following this article. This reaction shows an ugly side of the Australian character. It highlights the success of this government's campaign of wedge politics to victimise the less well off in our country. I would like to read to the House the letter that I received from Mrs Willy Fisher, who is Jodi's concerned mother. She says:Dear Jann,My name is Willy Fisher and I am asking for your help. The girl Jodi Fisher, on the front page of the West Australian (22/5/02), is our daughter. We've been through a terrible few days with her as she is extremely worried about how the Commonwealth budget will affect her family. Her husband received brain injuries in a major car accident nine years ago, prior to their marriage. Since then he and my daughter have contended with months of in and out patient hospital treatment, years of rehabilitation and difficult often failed attempts at re-entering the workplace.He now manages to work 22 hours a week in a supported position, which was found for him by a disability support service. Even this is very difficult for him. He struggles every day and is not capable of working any more hours per week than he is already. As it is, each day requires ten times the efforts of an “able” person. My daughter and her husband have not slept or eaten properly for days and I am extremely concerned for their wellbeing. It is horrible that this is being done to the most vulnerable people in society. My daughter does not know how they will survive from day to day. They do not drink or smoke, live quite simply, have two fourteen year old cars, hardly go out and do not know where they will be able to cut costs.Their fears grow daily as they know this will only become more difficult as the children get older. I wonder if you would take this matter to parliament so that we can be assured that someone is fighting for our cause and the cause of many others in similar situations, some of whom are probably still ignorant of the full extent to which these changes could affect them. These people are not bludgers or welfare cheats. They are doing the best they can in extremely difficult circumstances.Hoping you will be able to help us.Yours sincerelyWilly Fisher.Mrs Fisher gives a heartfelt account of the problems facing her family. I want to contrast this with a letter from the letters page of the West Australian of 24 May 2002 by Margaret Schofield of Willeton. The letter is entitled `No sympathy for this family' and it includes the words:Every picture tells a story. This clearly is not a deprived family. Apart from the enormous advantage of owning their own home at an early age, one partner has the personal resources, if she so chooses to do so, to earn a good living in a profession where employment is plentiful. Hard working taxpayers struggling to make ends meet must be gnashing their teeth after reading the financial set up of this “pensioner family” and their protestations of unfair treatment.The questions are: did the Fishers choose to have the traffic accident which left Mr Fisher permanently disabled? No. Did Mr Fisher choose not to work and lie around feeling sorry for himself instead of trying to make a contribution to society through working? No. Did Mrs Fisher do wrong by sacrificing her career and staying at home to raise her children like hundreds of thousands of other mothers? Did she have a choice, when her husband is physically unable to look after their children at home? No.The level of castigation from ignorant and judgmental people like Mrs Schofield continues with some comments made by Mike Larry of Kalamunda. I will not read them out, but can I say that we have a society that talks about justice, equity and fairness and we have a society that considers itself to be compassionate. But, from what I have read out, people like Mrs Schofield and Mr Larry should be ashamed of themselves. They should be ashamed for attacking a family based on the number of children's toys in the photograph. They should be ashamed for presuming the couple own their own home. Like them, and most Australians, the banks own the Fishers' home. Mr Larry should be ashamed that he contradicts himself in his letter saying that he works and studies full time. It is difficult to do both full time. He should be ashamed about his statement claiming that he gets no government support. (Time expired)389719:55:003897Randall, Don, MPMr RANDALLPK6CanningLP10—I would like to raise the issue of the Brookdale Liquid Waste Treatment Facility in my electorate. The Brookdale waste treatment plant is a toxic waste dump in Forrestdale and it is a sad fact that this plant has been operating for some time. After much agitation, community involvement and many rallies in the electorate, the community were able to get to the point where they almost railroaded the state Labor government into taking measures to eventually close it down. The problem is that this waste treatment facility receives PCBs, inflammable liquids and even radioactive waste. It is a shocking indictment on the waste treatment facilities in Western Australia that in the middle of a residential area we could have a toxic waste dump like this. The state Department of Environmental Protection are a disgraceful organisation in that, when this matter was first raised some time last year, they even denied that toxic waste was being dumped into this facility. They denied the fact that contaminants were getting into the water table and that the level of contaminants was causing health problems in the electorate. It was not until greater analysis had been made of this site—carried out because of public pressure and because workers began to tell members of the public what was actually going into the site—that this issue was brought to a head.To her credit, the local state member Alannah MacTiernan took the matter from a very weak state environment minister, in the form of Judy Edwards, and saw that something was done about this. She took measures to stop waste of that nature being received in this facility. But I have to inform the House this evening that that is not happening the way it was meant to. I am informed today, for example, that many toxic wastes—PCBs and those sorts of contaminants—are still being sneaked into the waste treatment facility via septic trucks. In other words, the sewage trucks that come into this facility are now being laced with highly toxic inflammable waste. I am told that in some cases chemicals are put inside these trucks so that they cannot be identified. This is a terrible indictment of the waste treatment facilities in Western Australia, as I have already said. But the greatest indictment here is of the Department of Environmental Protection because they have been very slow in addressing this matter. They should be more proactive in closing this place down. The deal was that by the end of February these materials would not be allowed to be received into this facility. In the electorate there are a number of concerned groups, groups such as Forrestdale Action Group and Mothers and Others, a group of breastfeeding mothers who are very concerned about this sort of waste in their neighbourhood in my electorate. I have just got off the phone from one of the people involved in this matter, who told me that this material is still being received.The DEP—and this is a fault of the state government—had $5 million cut from their budget in the recent state budget in Western Australia, so their ability to do the job is being hamstrung in some respects. We now have the situation where people in this area have contaminated water bores. They are suffering ill health and are experiencing skin irritations, loss of hair, and breathing problems which complicate the condition of anyone with asthma et cetera. The facility is causing a great number of health problems. There needs to be an audit of the health problems in the electorate that have been caused by this toxic facility. There is going to be a rally on 29 March in Canning in Waterfall Road in the Forrestdale area, to deal with this matter. I encourage anybody that wants to involve themselves—and I will certainly be alerting the electorate to this—in making sure that the government and the Department of Environmental Protection do their job by closing this facility down once and for all and by having this material treated in the right place to do so straightaway.10000SPEAKER, TheThe SPEAKER—Order! It being 8 p.m., the debate is interrupted.NaN:00:0020House adjourned at 8.00 p.m.Notices3898The following notices were given:SJ4Tuckey, Wilson, MPMr Tuckey to present a bill for an act to provide for investigation of transport accidents and other matters affecting transport safety, and for related purposes.SJ4Tuckey, Wilson, MPMr Tuckey to present a bill for an act to make amendments consequential on the enactment of the Transport Safety Investigation Act 2002, and for related purposes.VK6Vale, Danna, MPMrs Vale to present a bill for an act to amend the Veterans' Entitlements Act 1986, and for related purposes.0J4Ruddock, Philip, MPMr Ruddock to move:That so much of the standing orders be suspended as would prevent the introduction and passage through all stages without delay by 5 p.m. today of a Bill for an Act to amend the Migration Act 1958, and for related purposes.K26Latham, Mark, MPMr Latham to move:That this House declares its support for: (1) the role of Australia's 1700 municipal libraries in providing information services and community-based learning throughout the nation; (2) Federal responsibility for assisting the development of the local library network, especially with new IT services; and (3) ensuring the National Library of Australia's Kinetica database is affordable for local libraries. 84SO'Byrne, Michelle, MPMs O'Byrne to move:That this House: (1) notes the pivotal role undertaken by the Australian Maritime College in providing maritime education and research; (2) further notes the high standard of training the College provides overseas students; and (3) calls upon the Government to immediately act to honour its election commitment regarding university status for the College.84SO'Byrne, Michelle, MPMs O'Byrne to move:That this House: (1) notes with concern the increase in the rise of piracy in the maritime industry; and (2) calls upon the Government to ensure that the current discussions on maritime security are also seen as an opportunity for finding solutions to the piracy problem.84SO'Byrne, Michelle, MPMs O'Byrne to move:That this House: (1) recognises the role of the merchant fleet in national defence strategy; and (2) calls upon the Government to ensure a policy framework that allows a sustainable environ-ment for the Australian merchant shipping industry in order to maintain the “fourth arm of defence”. 84SO'Byrne, Michelle, MPMs O'Byrne to move:That this House: (1) notes the increased risk of illegal entry into Australia from foreign crewed vessels that are now able to spend extended periods on the Australian coast; and (2) calls upon the Government to immediately act to review the current security arrangements in relation to foreign seafarers. 83DMurphy, John, MPMr Murphy to move:That, following the agreement on a ceasefire between the Government of the Democratic Socialist Republic of Sri Lanka and the Liberation Tigers of Tamil Eelam (LTTE), this House supports the following next key steps in the peace process:(1) the security forces should be withdrawn from the public places they have been occupying, thus paving the way for the resettlement of displaced persons;(2) de-proscription of the LTTE in Sri Lanka so that they are accorded equal and legal status to participate in peace negotiations;(3) determine a suitable composition and powers for the proposed interim administration for the Tamil homeland to rebuild war-ravaged areas whilst political negotiations are pursued; and(4) proceed with political negotiations addressing the security of the Tamil people and the three cardinal principles of nationhood, right to a homeland and the right to self-determination.2002-06-19—————The DEPUTY SPEAKER (Hon. I.R. Causley) took the chair at 9.40 a.m.Statements by Members3900390009:40:003900Irwin, Julia, MPMrs IRWIN83ZFowlerALP00—Hoxton Park Airport is located on the south-western boundary of the Fowler electorate. It is a small general aviation airport but one of the busiest airports in Australia, with over 120,000 movements each year. Hoxton Park is used mainly for flight training by single-engined aircraft and small helicopters. Despite the number of movements, Hoxton Park does not have a control tower and has a questionable safety record. In 1998 the pilot and passenger of a small aircraft died following a mid-air collision as they entered the landing pattern at Hoxton Park. Wreckage from the aircraft crashed into a home in Hinchinbrook, fortunately not causing further loss of life. In 1999 the pilot of a light aircraft died when a second aircraft landed on top of him as he prepared to take off from Hoxton Park Airport. In 2000 a vintage aircraft crashed on approach to Hoxton Park when attempting a forced landing, and last year a twin-engine aircraft crashed on approach to Hoxton Park Airport, seriously injuring the pilot. There have been more incidents since then.When you consider that Hoxton Park Airport is surrounded by residential areas, at least one serious or fatal crash each year is a worrying thought. And there is further development planned. This year residential land to the west of the airport is scheduled for release and construction is due to start on the Western Sydney Orbital. This important transport link is planned to run across the flight path at the southern end of the runway and then parallel to the runway at a distance of less than 100 metres. The environmental impact statement for the Western Sydney Orbital noted that the road would affect flight operations at Hoxton Park. The statement recommended height restrictions for the Cowpasture Road overbridge, precautions for high trucks using the road and roadside lighting limitations. At the other end of the Fowler electorate is Bankstown Airport, which is Australia's busiest airport with over 400,000 movements each year. It is planned to be sold as a package along with Hoxton Park Airport and Camden Airport. We know that the government wants the prospective buyer of Bankstown Airport to expand its use for passenger jets. This would displace training and other flights at Bankstown and lead to greater use of Hoxton Park Airport. Any increase in air traffic at Hoxton Park can only impact on its already suspect safety record. Hoxton Park Airport should not be sold to a private operator unless a full public review of its operations is carried out and nearby residents can be assured of its safety—that is most important—and, if not, it should be closed down.390009:43:003900Stone, Dr Sharman, MPDr STONEEM6MurrayLPParliamentary Secretary to the Minister for the Environment and Heritage10—I wish to put on record the heroic struggle of a lot of the small towns in my electorate of Murray. In particular, we received the cruel news in the first week of April that the National Australia Bank is leaving town. We have had a history of the contraction of smaller towns across Australia dating back to the earliest times when they went from horse and buggy to motor vehicle transportation systems. The First World War knocked out a total generation in terms of small communities surviving into the 1930s. But when you lose your only bank in a small town it really can mean a death knell. A lot of the local businesses that take cash—hotels, garages and shops of any description—need to lodge their cash, ideally at the end of each business day. They do not have the insurance or the security facilities to hold that cash over a week or longer. You also have the older members of the population and women with children who like to be able to access a bank where there is a human being across the counter and where they can get out of the cold rather than stand on a blustery corner trying to access an automated teller machine. A small town that does not have a bank is a place where you see streams of cars at the end of the working day leaving to go to the next larger regional centre to shop, to do their banking and to go to other services.So when the National Australia Bank announced on 3 April that they were to take another swipe at their local branches and they were to close Pyramid Hill, Tongala, Rushworth and Stanhope banks, a chill went through those communities. I want to put on record, though, the fact that each of those communities is fighting back. They now have in process the development of rural transaction centres. These are an excellent new strategy that this Commonwealth government under John Howard's leadership has put in place, where a combination of a range of important Commonwealth and other services are put together in a building that may have been empty for some time or may even be a converted domestic dwelling. Rural transaction centres are now well on the way through the very hard work of the community groups themselves, particularly in Stanhope, Tongala, Dookie, Leitchville, Rushworth and Pyramid Hill.I want to commend the Minister for Regional Services, Territories and Local Government, Wilson Tuckey, who is personally engaged in making sure the towns hardest hit by the withdrawal of banks like the National Australia Bank do not, in fact, have an even speedier decline but have a new era based on their own community struggle to make good. I think the National Australia Bank should be condemned. It was only a week later that they announced some of the greatest profits on record, having just informed these towns that they could no longer see themselves clear to service them, on the basis of declining rural business through their doors. 390109:46:003901George, Jennie, MPMs GEORGEJH5ThrosbyALP00—I take this opportunity to place on record the community's appreciation for the work of the Wesley Church Community Centre in Wollongong which caters for the needs of a growing number of homeless people in my electorate and to recognise the growing number of homeless people in Australia as a whole. The Wesley Church Community Centre was originally put into operation on the basis that it would cater for about 50 people, on average, a day. That list has now grown to approximately 166 people attending and eating at the community centre on a daily basis.A recent article in our local paper drew my attention to the plight of homeless people. I guess that for many homelessness is not something that we contend with or see on a regular basis. I think the stereotype of homelessness has always been depicted around an older man, usually with alcohol or drug problems, living on the streets. But a recent research study undertaken by Mission Australia actually debunks the stereotype that we have all grown to believe is associated with homelessness. It was interesting that the average Australian, like me, underestimates the magnitude of the problem. In the research study undertaken by Mission Australia, half of all the people who responded believed that there were fewer than 10,000 people homeless on any given night in Australia. The actual facts are quite alarming. As the research study indicates, there are over 105,000 people on any one night who are homeless. By homeless, they mean someone who does not have a stable and secure home to live in. Of course, a large number of these are described as `sleeping rough'—that is the people that we see on park benches and sheltering under cardboard boxes. Large numbers live in boarding homes and large numbers are accommodated in government provided SAAP accommodation. Others are described as `sofa surfing'.The Wesley Church Community Centre is like many not-for-profit organisations in my electorate that cater for the most dispossessed and disadvantaged people. I think it is incumbent on this government to pay these organisations the money that is outstanding for their award increases, to resource the sector more generously to cope with unmet demand and to remove the threats to disability funding that are still hanging over many organisations' heads. (Time expired)390209:49:003902Kelly, De-Anne, MPMrs DE-ANNE KELLYFK6DawsonNP10—I rise today to draw the House's attention to the state of the sugar industry in Queensland. It is on the brink of total collapse as a result of four consecutive years of low world sugar prices, poor weather and crop disease. An American sugar farmer receives, courtesy of American taxpayers, US19c per pound—sugar producers in the European Union are similarly protected and cosseted—while an Australian sugarcane farmer receives the world price of less than 6c per pound, which is well below the cost of production. Hard-pressed Australian cane farmers have to accept that the subsidies paid to US farmers and others depress world sugar prices by 17 per cent and strip $US1.5 billion out of the income of sugar exporters such as Australia. The question is often asked: are Australian cane farmers efficient and productive? Yes, they are. They produce 25 tonnes per hectare more than their nearest competitive rival. Are they subsidised? No, they are not. The Australian cane industry regrettably has become the canary in the coalmine of globalisation. Because 92 per cent of raw sugar from Queensland is exported onto the corrupt world market, they are the first industry to demonstrate the signs of that corrupt world market. Pressure is building up on the beef and dairy industries as well as the sugar industry. There is much that the industry can and will do to become profitable and sustainable in the long term, although its comparative advantage is being overrun by subsidies to and devaluations in the currency of its competitors. What the industry needs is a short-term financial bridge to be able to reach a profitable end point. I am confident that the government will continue to listen sympathetically to the plight of farmers and to act decisively to assist them. I have to acknowledge that the Liberal-National government in the last parliament gave some $63 million worth of assistance to over 5,000 recipients through the sugar assistance package. That was very well received. As well, the Prime Minister listened very sympathetically, prior to his trip to the United States, and raised the issue of the sugar industry with the US government. That is very much appreciated and his keeping faith with the sugar industry has resonated with all growers. It is time for a new paradigm for Australian agriculture in the rural and regional communities that depend on it. Agricultural experts have to shed some long-held—but flawed—beliefs that deregulation is good, that small farms are necessarily inefficient, and that increasing economies of scale will overcome all problems; that is simply not the case. There has to be a plan for long-term profitability so that farmers who are efficient are able to be profitable, regardless of world prices and weather conditions, and that there has to be a bridge to enable them to reach that end point. (Time expired)390309:52:003903Grierson, Sharon, MPMs GRIERSON00AMPNewcastleALP00—I am delighted to rise today to share with the parliament my pride in the public schools of Newcastle. Although I have always been one to champion the achievements of our local students, teachers, staff and school communities, last week was a very special one for public education in my electorate. Last week more than 3,000 primary and secondary students from 115 government schools throughout the Hunter, Manning and Central Coast regions performed in the 10th annual production of Star Struck, a three-hour spectacular of live music, dance, movement and drama. With ticket sales of almost 18,000, the 10th birthday celebration of Star Struck was a huge success delighting audiences of proud family members and the general public. Every year the most striking feature of the Star Struck performance is that thousands of students of all ages, circumstances and talents are polished into stars and entertainers by the dedicated production team of directors, choreographers, costume set and props designers, musicians, and stage and technical managers. Who are those clever professionals? They are the teachers and students from our public schools who willingly devote many, many hours above and beyond their normal duties and tasks to make sure that the show goes on. A particularly heart-warming feature of every Star Struck performance is the diversity of the student performers. They come in all ages, shapes and sizes, with all manners of talents and abilities. Together they stage a wonderfully entertaining production. Every year, audiences marvel at the courage and determination of students with disabilities as they delight us from their wheelchairs, in the Hunter signing choir or in items side by side with their more able-bodied peers. For one very special week these special students are just one of the cast and crew that is Star Struck. For one special week, every student who participates seems to grow in stature, pride and self-esteem. I pay tribute to the many talented students who have gone on from Star Struck to develop successful careers in the entertainment and performance industry. Many of these past performers return each year to mentor, inspire and encourage others. I also pay tribute to the New South Wales Department of Education and Training and to the many sponsors who are partners in this wonderful venture who have willingly invested in showcasing the talent of public education, an investment that is returned to them manyfold through community recognition, celebration, pride and loyalty. In concluding, I must make special mention of the very talented producer-director of Star Struck since its inception, Mr John Deacon. Although he would remind me that he is only one of many who contribute to producing Star Struck, John is a teacher who believes in dreams, who never doubts that the impossible can be achieved and who motivates and leads others through his excitement, warmth and humour. John Deacon has injected a special ingredient of magic into Star Struck for 10 years and I congratulate and thank him on behalf of Newcastle. Congratulations to everyone involved in Star Struck 2002 for another 10 out of 10 professional performance by public education in Newcastle.390409:55:003904Elson, Kay, MPMrs ELSON6K6FordeLP10—I appreciate the opportunity to bring to the attention of the House some very special people who help my electorate of Forde to be such a wonderful place to live in. I am fortunate to represent an area that is built on the strength of its individual communities, where people are willing to lend a hand to help others and there is a strong sense of civic pride and community spirit. It is something I am very keen to foster and encourage, especially for future generations.Each year I am very proud to recognise the outstanding achievements of many local voluntary workers through the Forde community contribution awards. I established these awards in 1996 as a way for our community to say thankyou to the many people who give so much of their time to help others. These are the people who give our community its heart and soul and they never seek recognition. They are a shining example for our younger residents in particular. This year I was delighted to name 18 individuals and two community organisations as recipients of the 2002 Forde community contribution award. I was very pleased to have the Minister for Ageing, Kevin Andrews, join me in congratulating them at a special presentation ceremony last week.While there is certainly not time today to list all of their achievements—that would take almost a full day's sitting—I would like to thank them once again on behalf of the community. Their collective services range from local RSL sporting associations, the SES to the CWA, police citizens youth clubs, local show societies, environmental protection groups, tax help volunteers, railway restoration workers, senior citizens, medical services and a whole range of local and national charities. Every year I am amazed and inspired by the letters of nomination I receive from local residents—people who have witnessed years of dedication and community service and who are truly grateful. This year's award recipients are yet another outstanding example of how special our corner of Queensland really is. To be able to represent people with such huge hearts and willing hands is indeed a great privilege for me. I want to recognise this year's 2002 Forde community contribution award recipients today and read their names into Hansard. They are: Bernard McDonald of Helensvale, Ray Hutchinson of Oxenford, Will Buch of Tamborine Mountain, Ray Holmes of Beaudesert, Jim Daynes of Tamborine Village, Pauline Critcher of Tamborine, Betty Hetherington of Eagle Heights, Fred Gillow of Beaudesert, Yvonne Chalk of Boonah, Mike Drewitt of Beenleigh, Dawn Clayfield of Guanaba, Pat Heck of Woongoolba, Dr Tom Nutley of Tamborine Mountain, Ron and Zena Spanswick of Shailer Park, Bob Whiley of Windaroo, Tom Ferguson of Beaudesert and Reverend Don Macdonald.I was also pleased to give special recognition to members of the state emergency services for their tireless efforts and special work in helping 500 houses on the Gold Coast three days prior to Christmas. The Tamborine Mountain Historical Society is also nominated for its ongoing efforts and dedication to preserving our unique local history. I am sure all honourable members of this place will join me in congratulating and thanking these special people who play such a vital part in my community.10000Causley, Ian (The DEPUTY SPEAKER)The DEPUTY SPEAKER (Hon. I.R. Causley)—Order! In accordance with standing order 275A, the time for members' statements has concluded.Bills3905R15403905Debate resumed from 18 June, on motion by Mr Costello:That this bill be now read a second time.upon which Ms Macklin moved by way of amendment:That all words after “That” be omitted with a view to substituting the following words:“whilst not declining to give the bill a second reading, the House condemns the Government for:(1) its failure to deliver a budget surplus in 2001-02 after a decade of growth:(2) its failure to deliver a budget surplus in 2002-03 without breaking previous commitments on defence, roads and working credits;(3) imposing the cost of a pre-election spending spree on families via higher interest rates and cuts in health and welfare spending;(4) falsely claiming that cuts to health and welfare payments are needed to fund the war against terrorism and border protection;(5) wasting $5 billion of taxpayers money by gambling in foreign currency markets through cross currency derivatives;(6) wasting almost $3.5 billion by failing to manage currency risk on defence spending despite warnings from the Auditor-General;(7) wasting $31 million on maintenance services for 40 year old helicopters that are years overdue despite a $800 million downpayment;(8) its failure to recognise the GST as a Commonwealth tax and this Government as the highest taxing of all time;(9) its failure to consider the fairer options put forward by the Opposition to offset the harsh measures it intends to impose on families, the sick and disabled; and(10) the failure of its Intergenerational Report to recognise that investment in education, research and development is critical to our future prosperity and our capacity to generate the revenue and wealth required to support an ageing population.09:59:003905Byrne, Anthony, MPMr BYRNE008KOHoltALP00—In speaking to Appropriation Bill (No. 1) 2002-03, I thought the most effective way of demonstrating its impact would be to localise some of the examples. One of our responsibilities as federal members of parliament is to reflect the impact of government policies on our constituencies. With respect to some of the changes proposed to the disability support pension and the Pharmaceutical Benefits Scheme, a large number of agencies, particularly those that cater to the less well off in our society, are very angry about what has been proposed. They believe that it discriminates against them and discriminates against those that are the least well off in the community.Just for the member for Kooyong's edification, rather than me making my comments in terms of this—which are pretty obvious—I will read an excerpt from the chief executive officer of a local community based organisation called Cornerstone, which is a local church urban mission located at the corner of Mason Street and Walker Street, Dandenong. This organisation caters to the less well off. It caters to those with psychiatric disabilities who cannot find accommodation. It caters to those with alcohol dependency problems. It caters to those who are afflicted by the drug epidemic in Dandenong. We are talking about someone who deals with the least well off in our community. We are going to recommend that this organisation applies for emergency relief funding because it takes up the great slack in the community; a lot of people who cannot get access to government services are getting access to this sort of place. It runs very successful lunches and I was very fortunate to attend one of those lunches some two months ago. I met about 120 people there. The organisation is overburdened by the demands on it by people within the community. I would like to read a note from the chief executive officer's desk in which he is passing comments on the federal budget:The recent Federal Budget has caused massive distress for those on the fringes of our society especially those on disability pensions. The added burden of larger costs at the chemist will push more people on to welfare. If the actions of the Federal Govt were a one off it would be bad enough but this scenario of welfare recipient bashing is a consistent theme of previous budgets and reflects the general attitude of the Coalition to the poor in our community. Safe in their well funded ivory towers they have no concept as to what it means to struggle to live on the pittance they dole out. The poor are expected to be grateful for the crumbs that fall from their superiors' table. This is an example of class discrimination at its worst with the poor being denigrated to the lowest rung of our society. We would lament this in a totalitarian society but ignore it when it happens on our own back door. Already this year Cornerstone has seen the numbers for our lunches jump from 80 to 120. As the stress to survive grows more and more will be seeking assistance. The crisis in welfare is causing pandemonium and chaos to the fringedwellers and more and more will be forced to seek assistance from agencies due to draconian policies of a Federal Government that appears to have lost any sense of compassion for the `battlers' in our society.This person is not a member of the Labor Party. This person is a well-respected community leader who has no political bias but who cares for his constituency and provides a tremendous service to it. I am very happy to support Pastor Max Walker's campaign to ensure that we do get some equity and fairness into the system, particularly with respect to those on disability support pensions.I would also like to read some representations that I have received from the Eastern Regions Mental Health Association Inc. This is an unbelievably good organisation that caters to the most severely affected in our community—some 450 people in the city of greater Dandenong. It is an organisation that looks after those with schizophrenia, with bipolar disorder and with acquired brain injury. These are people who are the least well off; the most vulnerable in our community. I would like to read some comments made by the President of ERMHA, Jill Gray. They have asked me to raise in parliament their concerns about the proposed changes to the disability support pension and how it impacts on those with mental illness. If I can, I will read edited sections of this:I write with concern about the proposed changes to the disability support pension and in particular the impact on DSP recipients with mental illness. DSP recipients represent over 90 per cent of the 450 clients annually who use the Eastern Regions Mental Health Association Incorporated—which is ERMHA—in Australia. About 25 per cent of people who receive disability support pensions do so because of the long term disabling consequences of an enduring mental illness. Mental illness is one of the most disabling of health conditions. Australian statistics show us that there is a higher chance of becoming disabled from a mental illness, which is years lost to disability, than becoming disabled from other serious health conditions, such as cancer, heart disease, respiratory disease, diabetes and injury. Bureaucratic changes to the eligibility criteria for disability will not change the actual level of disability in society or for the individual.Mental health authorities tell us about the role that stress plays in the recurrence of mental illness. The proposed change to the hours criteria of the DSB from 30 hours to 15 hours may well result in increased stress, illness and disability amongst the many people currently on DSB due to mental illness. Mental disorder, in the main, is an invisible illness. It is not readily recognisable by people in the street, yet it still attracts much stigma and misunderstanding. I am concerned that DSB recipients could become the target of scapegoating, particularly if their disability is not overt and visible and not seen to be more than 15 hours worth of disability. For many of the thousands of people who have used ERMHA'S services over the last 20 years, increased stress has been a major factor in the recurrence of the symptoms of their mental illness. As well, many report that community attitudes are as much a disabling barrier to overcome as the illness itself.The second national mental health plan focuses on ways to decrease the burden of disease, reduce mental disorders and improve mental wellbeing. I believe it is in the long-term measures such as those advocated by the second national mental health plan and the ongoing developments in the knowledge of mental illnesses and effective treatments that will provide more enduring solutions to the burden of disability in society. Good psychiatric interventions work on both the medical factors and the psychosocial factors impacting on a person's health condition, and such interventions are increasingly being used in mental health practices in Australia. It will take a little time before we see epidemiological changes that will result from these developments.In the Dandenong region I have facilitated the establishment of a mental health group called MIDDWAY—Mental Illness Doesn't Discriminate; What About You?'—to combat the stigma associated with mental illness, yet these very same people are going to be targeted as a consequence of the proposed changes. On the one hand the government talk about trying to rectify or reduce the stigma for those with a mental illness and the impact on carers in the community, and on the other hand those people are being singled out because some of them work more than 15 hours—for example, some of the people who will be put on Newstart. Other people who can be affected are those in a disability workshop called Gateway, which is in my electorate. That organisation employs 30 people. Its people facilitated a project called the Federation Gardens Project, which is an icon project which was funded out of Federation funding, on Frawley Road, Doveton. It is a great project which has a lot of community pride attached to it. Five people with intellectual disabilities helped to create it. It appears those five people who worked on the Gateway project will now be put on the Newstart allowance. I spoke to the Director of Gateway Inc. last night, and she was very concerned about what is going to happen to those people. Why are those people being singled out? Why do they have to pay the burden to repair the budget losses that have been caused as a consequence of the war on terror? Why do the most disadvantaged people in our community have to pay the price of a budget deterioration which is not of their making—a budget deterioration of about $14 billion over the past 24 months which was assisted by about $5 billion worth of currency speculation?There is another anomaly that I would like to raise, and it is a fairly difficult constituency matter. It also refers to the administration of the family tax benefit part A and part B. It is an example of what happens when governments do not calibrate their policies properly—some people can slip through the net and be disadvantaged. I will not name the individual concerned; I will refer to her as Mrs B. That person lives in Narre Warren North. I have raised this matter with the minister, but this individual is quite happy for me to raise it in parliament because it is indicative of some of the structural deficiencies within the system and the administration of family payment part A and part B. She receives a family tax benefit which is currently based on the estimated earnings of a person 12 months in advance. We know that it is difficult for a lot of people to do that. Mrs B has a family tax debt of $2,120. That debt was $3,120 until the $1,000 dispensation. Mrs B's tax debt arose from inconsistent payments of a former husband through child support. From June 1999 until July 2000 Mrs B did not receive any child support from her husband. Prior to that the payments were less than regular as well. Therefore, Mrs B was meant to estimate her income 12 months ahead when she was not certain whether there would be any income.Finally, in September 2000, Mrs B received an arrears payment from her husband of some $6,000. After this period, payments were still not regular from her husband, so estimating her income was still very difficult. Under section 20A of the family assistance act, she was deemed to have received all that money in the same financial year, being June 2000 to July 2001. The back payment from her husband was actually for two financial years prior, being 1999-2000 and 2000-01. So Mrs B is being penalised with a debt, even though it is the fault of her former husband who does not pay his child support on time. Further, the act should have some allowances which take into account income such as this which accrued over the two financial years. The SSAT has reviewed the case and said it would not cause Mrs B severe financial stress, which is interesting. Mrs B is a single parent who lives with her daughter who suffers from angelman syndrome and who will require a carer for the rest of her life. We have asked, and it is accepted, that Centrelink stop garnisheeing payments until such stage as the minister responds to this inquiry. Certainly there needs to be some humanity in terms of the administration of that. This is an example of an individual who has fallen through the cracks, particularly with the administration of that estimation of income.There is one further thing I would like to add—and I am conscious that we are permitted to speak for 15 minutes—and that is my ongoing campaign for the establishment of a Medicare office in the Fountain Gate Shopping Centre. A couple of weeks ago, here in the Main Committee, I tabled a petition of 19,073 signatures, which requested the provision of a Medicare office in the Fountain Gate Shopping Centre. This shopping centre is in the epicentre of a growth hub, a growth explosion, within the City of Casey. The City of Casey has a population of some 191,000; within the next 10 years it is estimated there will be some 300,000 people. Within the City of Casey, there are 20,000 children aged between one and four. It is a very young population; it is a young population that goes to the Fountain Gate Shopping Centre. The Fountain Gate Shopping Centre has a Medibank Private office but it does not have a Medicare office. It has a population of close to 200,000 people, going to 300,000 people in 10 years time; it has 20,000 children aged between one and four; it has 200,000 shopping movements through it per week; but it does not have a Medicare office. The City of Dandenong has a Medicare office in the Dandenong Shopping Centre. That is about 10 kilometres away. The City of Warrugul has a Medicare office and the City of Knox has a Medicare office, but the City of Casey does not have a Medicare office.This is a campaign that was waged and started some 11 years ago by the member for La Trobe, Bob Charles, and I have raised it previously. So this is an issue which really has bipartisan support. My question to the government, and more particularly to the Health Insurance Commission, is this: when will you listen to the community and put that Medicare office in the shopping centre? You have had plenty of time. The rationale that is provided to me is that you have to wait for an office to close before you open another office. If the government has a commitment to families, as it claims it does, it will make sure the provision of funds is there to ensure that a Medicare office is put in the Fountain Gate Shopping Centre. This is the No. 1 issue that is raised by shoppers when they attend the shopping centre, particularly with the rate of bulk-billing—it is not high; it is decreasing in the outer suburban fringes. Consequently, I do not think it is too much to ask—particularly if the government does have a commitment to families, as it claims it does, particularly in a growth belt area—that it commit the funds for that to occur. There are a number of other issues that I would raise, but time is running short. I would like to finish my statement by congratulating the person next to me, Michael Danby, the member for Melbourne Ports, who recently announced his engagement. Michael is a good friend of mine. I wanted it on the record. He is a very decent human being. This will be a great partnership. To you, Michael, congratulations, and to Amanda as well.10:14:003909Bevis, Arch, MPMr BEVISET4BrisbaneALP00—One of the interesting things about this debate on Appropriation Bill (No. 1) 2002-03 and the budget is that the government have actually run out of members to speak on their budget. It is an indication of the government's support for their own budget and the budget's standing in the community that there are fewer members of the Liberal Party and the National Party willing to stand in the parliament and speak about it than there are members of the Labor Party, and the list is not yet complete. That is not surprising because the public reaction to this particular budget has been very negative—very negative indeed.When governments frame budgets, they usually have two things in mind: one is the political goal that they seek to achieve from the budget, and the other is the economic goal they seek to achieve. Occasionally, budgets will be good on one and not so good on the other. If you are particularly lucky as a government, you can get both the politics and the economics right. On this occasion the government have managed to get both wrong. They have got the politics of it wrong and they have got the economics of it wrong: they scored on neither count. From a political point of view, it is clear that the unsavoury measures such as the changes to pharmaceutical benefits and disability pensions have not been popularly received by the Australian community. From an economic point of view, it follows a deficit budget which we were told would not occur and which has failed to implement any significant economic initiatives that would see our future in a better position than we were facing prior to the budget.One of the most significant things about the budget, and one that has not received much headline consideration, is the bottom line that the government left us with at the end of last financial year. The government returned a deficit budget after 10 years of economic growth. This is a significant event. It is not uncommon for governments to produce deficit budgets; in Australian political history that is the norm. But it is common that during periods of growth—particularly sustained growth—governments seek to operate surplus budgets so that when times are difficult there is some money the government can fall back on, to stimulate the economy with. Here we have an exercise where the government has produced a deficit budget after 10 years of sustained growth. You have to ask yourself: if a government is not capable of providing a surplus when it is in a period of sustained growth, what chance is there of providing a surplus when economic times are harder?This deficit need not have occurred. We have witnessed a number of government activities that have driven the creation of this deficit. The previous speaker made mention of one of those whilst I was here: the $5 billion gamble on the currency swap. This is something for which any business executive would be unceremoniously sacked and removed from any position of responsibility in the corporate world. I have spoken about this in other debates in the parliament, so I will not go through it in the detail that I have done there. There is insufficient time with the restriction on the debate here. But I make the point that the currency swap system put in place by the former Labor government had with it a series of important guidelines that government was required to conduct the currency swap within. Those guidelines protected the Australian taxpayer. When this government came to office it was well aware of that. It was advised of those guidelines; indeed, it was advised of the problems that it was entering into in breaching those guidelines. This Treasurer's response to that advice was to change the guideline to expose the taxpayer to a greater level of risk. As a result, we have seen a $5 billion loss of taxpayers' money on currency swaps since this government took office. In the period prior to that, during the former Labor government's term in office, the same currency swap scheme was operated with a net gain to the taxpayer of some $2 billion. This $5 billion deficit would have come in handy in the last year, I am sure, as the government sought to balance the books. The people in the electorate are right to ask themselves what priorities could have been funded and what benefits could have been provided had that $5 billion in currency swaps not been lost by this government. Certainly we would not have had the deficit budget.But that is not the only driver of the deficit budget we have just seen. Significantly, over the course of the last year the government became spooked by the polls and by the electoral results in Western Australia and Queensland. In the Ryan by-election in Queensland we saw a massive spending spree in the 12 months leading up to the election campaign. In the last financial year, this financial year and the previous two—that is, over a four-year budgetary period—the government managed to spend in excess of $20 billion of the planned surplus. In fact, the government only a matter of three years ago said that we would have a surplus in this last year of $14 billion; they returned a deficit. This has been one of the most monumental failures of financial management in the country's history. It astounds me, frankly, that the press gallery, who like to write about these things, gloss over that. One of the best pea and thimble tricks of modern politics is the way in which this current government are able to portray themselves as good economic managers when in fact in the course of the last four years they have squandered the greatest amount of public funds I think ever in a four-year period in peacetime. I cannot think of any period since Federation where a government has squandered that amount of money in such a short space of time. That does not take into account the next three-year period, when the promises, commitments and spending programs that they hastily put in place in the lead-up to the last election come on board. We are talking over a seven-year period of some $30 billion over and above planned expenditure that this government have squandered. That is an amazing feat for anybody to achieve. It is monumental economic mismanagement. It really is one of the great mirror tricks of politics today that this government are able to portray themselves as responsible economic managers when in fact their record over the last three years and their plans for the next two years represent the most irresponsible fiscal management certainly in a generation, and I think since Federation.In the time remaining, let me turn to a couple of the specifics in this budget that do warrant particular comment. The attack that this government have launched on the Pharmaceutical Benefits Scheme by requiring ordinary Australian families to pay about 30 per cent more for scripts is totally unfair and unjustified. Against a background where the government squandered that money, we now have the absurd position where the government propose to hit ordinary families with a very significant increase in their medical costs at the same time as they propose to give the top three per cent income earners in this country a tax break. The only people who actually get a tax break out of this government's budget are the top three per cent of income earners, through the superannuation surcharge. The people who this government say should pay less tax are the highest three per cent of income earners in this land.So if you are wealthy you get that three per cent cut on your superannuation surcharge, but if you are an ordinary family with a couple of kids—winter has come on, and we all know that when one kid in the house gets the flu it does not stop there; if you have got two or three kids you will be guaranteed that within the fortnight they all will have got it—it is actually going to cost you more now to get the pharmacy script filled than to see the doctor. That is what this government are going to do. They are actually going to make the pharmacy script more expensive than going to the doctor in the first place to get the script. For ordinary families, that is a significant burden. How the government can justify proposing to give a handout to the top three per cent of income earners—including, I might say, every member of this parliament—how they can propose to give themselves that handout when ordinary families are being slugged like that, defies any sense of fairness.But it is not the only example of where this has happened. The government introduced, as they announced in the last election, a new baby bonus, a new payment for parents on the arrival of babies. Payment to assist young families is a good thing; the former Labor government established such a scheme. Everyone recognises that there are significant costs that young families face with the arrival of new children. But this government have adopted a totally new approach, which is foreign to the Australian ethos when it comes to this. They now have a system in this budget where the amount of money a parent will get depends on how rich they are. But it is not as people have traditionally understood income tests. Under this government's baby bonus scheme, if you earn more money they will give you more money; if you earn less money you will get less money. This is a new approach to public support for the community that I am not familiar with. This is the Robin Hood in reverse approach. This is where the ordinary working family with a low income will get a minimum of $500 but if you are wealthy this government will happily give you $1,500.So the moral of the story that this government is promoting is: `Be rich and the government will actually give you a bigger handout, but if you are on a low income you get less.' I want to understand the requirements of this, because I have not heard government members explain this point of the budget to us yet. Regarding the costs of having a child and the need to have a room set up—the nappies, the cot, the bottles and the things to sterilise them with, the kid's clothes and the whole array of things we are all familiar with—I would have thought that, if you came from an ordinary working-class family, you would probably need to buy the same things as anyone else. If you are on an income of $100,000 or $200,000 a year, you might want to get a classier type of cot, but, at the end of the day, kids all have to sleep in a cot or a bassinette or whatever. This government are actually going to give you more money if you are rich. I think they owe the Australian people an explanation as to how they can justify slugging ordinary families at the chemist and, in the same budget, giving the top three per cent of income earners a tax break and saying to people who have a baby, `The richer you are, the more money we will give you.' The other point I want to make is in relation to the disability pension. We are accustomed to this government seeking to attack those who are vulnerable in our community, but you would have to go a long way to find a group of people who are more vulnerable than those who are identified and accepted today as disabled, whether that is because of physical or mental impairment. People who are on disability payments are in a different position to others in the community and do require some special consideration. By definition, they are seldom people who can organise themselves to fight back against a government attacking them. This government has chosen to attack probably the most vulnerable group in our community. I am sure I am not alone, on either side of this House, in saying that since the budget came down I have had a number of people in receipt of those benefits come to see me, distressed—and I mean seriously distressed, to the point of being ill about their concern for their future. They do not know how they are actually going to cope if they are put in the position of losing this benefit and being put on an ordinary Job Search allowance.I have spoken to people who are young, I have spoken to middle-aged women and I have spoken to parents of people who are on disability benefits. They are genuinely distressed about how they will confront the future if this government's budget measure gets passage through the Senate. They are enormously comforted when I say to them that the Labor Party will vote against it. We will do what we can to block it in the Senate, and I believe that we have sufficient support there to do just that. Nothing short of that has given the people who have come to see me any sense of comfort. It really is an issue of priorities. Budgets are not just about money; they are a reflection of a government's philosophy, values and priorities. What we have seen with this government's budget is that it gives priority to the wealthy, it will redirect money from the poor to those who have it and it will penalise those who are the most vulnerable in our community—and that has all been done in this one budget, without any saving economic benefits. This is, without doubt, the worst budget this government has delivered since 1996. The trouble it will encounter in the Senate will be of its own making.10:28:003912Sercombe, Bob, MPMr SERCOMBEQK6MaribyrnongALP00—As my colleague the member for Brisbane has most eloquently indicated to the chamber, this government certainly has blown things extraordinarily badly in the context of the overall budget position and it has done that at a time of 10 years of economic growth. It takes monumental incompetence to achieve the sorts of deficit outcomes this government has achieved at the end of a 10-year growth cycle. It is really no wonder that the Treasurer is so anxious to see the Prime Minister move on because, with a track record like this, one can well imagine his star may start to wane sooner rather than later.It is worth emphasising the scale of this turnaround. Three years ago we were told that, on projections, in this budget year we would be looking at a $14 billion surplus. What in fact we are looking at now is closer to a $3 billion deficit. As I said, that is against a background of a 10-year economic growth period. There is an extraordinary lack of discipline and extraordinary incompetence. I will not repeat what the member for Brisbane said when he referred extensively to the extraordinary losses associated with the $5 billion losses on currency derivative trading—as compared with the experience under Labor when the budget surplus was contributed to by that process over the life of that government. But it is an extraordinary lack of achievement that produces this situation, which is against the background of unprecedented high levels of indebtedness in households and individuals. We are looking at substantially increased pressures for further interest rate rises, higher mortgages and higher credit card debt—all against a background of unprecedented high levels of indebtedness. Realistically, this is a budget and an economic performance that ought to be condemned.As my colleague also indicated, it is a budget that is characterised by substantial areas of unfairness directed at some of the more vulnerable people in our community. The member for Brisbane did refer extensively to changes in pharmaceutical benefits, so I do not propose to go through all those details again except to say that it is particularly telling that we are discussing this matter at a time when the Treasurer—once again almost unprecedented—is threatening the independence of the process of determining the Pharmaceutical Benefits Scheme by his comments yesterday in the House. He quite clearly indicated that, unless the government's proposed changes were passed, there would be interference in the process of determination of pharmaceutical benefits—presently handled in a very professional manner and on the basis of expert opinion and advice. That would then call that process into question. This is an outrageous situation and one that ought to be condemned. It does not get away from the reality that households will face a 30 per cent increase in the costs of essential medicines—over the life of this government, a 70 per cent increase. Households will be paying $28.60 for each prescription, an extra $6.20 per script. Pensioners will be paying $4.60, up $1 per script.That is a situation to be deplored, and essentially a short-sighted approach because the predominance of scripts are for people who are ill or elderly or both. We all understand that, in the absence of an appropriate regime of medical supervision of pharmaceutical use and similar treatments, these people are going to get sicker quicker and they are going to be spending more time in hospital. So in the longer term the costs may well blow out in the public sector anyway because people may, under these sorts of costs and charges, tend to avoid taking the sorts of pharmaceuticals they need to manage conditions. The other outrageous assault in the budget on vulnerable people in the community is the changes to the disability pension. I received a moving letter from a constituent of mine who gave me permission to use his name, Natale Cutri, who is a young 33-year-old disabled man. In his letter he describes, in a very articulate way, the interrelated nature of the problems he and other disabled people face in all areas of their lives, whether we are talking about transport, home life or going to the shops. All these things mean that disabled people face a range of compounding disadvantages. Through extraordinary personal effort, this particular young man has been through the education and training systems and he now works at a responsible job in a situation where he is undoubtedly paid less than he would be if he did not experience his disability, but he leads a fulfilling and important life within his family and community. Quite correctly, he sees that this package of measures will discourage people with a disability from getting back into the work force. The package is most insensitive and undermines important initiatives in relation to disabled people playing a full role within the local community. Frankly, it is penny-pinching, mean-spirited stuff and ought to be condemned.The Down Syndrome Association issued a very good statement indicating that it strongly opposes the proposal to move those people who are assessed as being able to work more than 15 hours at award rates from the disability support pension. The association said that, firstly, the proposed changes would have a significantly negative impact on those who are working and those who are about to embark on training and entry into employment; secondly, the proposed changes will discourage people from extending their hours of work to more than 15 hours and will significantly reduce the income of those working longer hours who have been transferred to the Newstart program; and, thirdly, these people will lose a range of benefits such as travel concessions, rental assistance and health benefits. This is a poorly conceived penny-pinching approach that significantly affects the self-esteem of people with a disability and undermines their capacity to contribute fully to the community.I referred earlier to the fairly thuggish approach of the Treasurer's threats about pharmaceutical benefits. The government takes a similar approach to disability by threatening $100 million of funding provided under the Commonwealth-State Disability Agreement if it does not get its way with respect to the disability support pension. Once again, the government has clearly got its priorities wrong. It is picking on some of the more vulnerable people in the community to pay for the Treasurer's gambling debts and similar misjudgments. I think the public will increasingly see that for what it is.I want to turn to another area of government policy: the very important services that are provided to the community by Australia Post. Australia Post is an organisation that makes a most important social contribution to our communities and to society as a whole. As an organisation, it makes a substantial contribution to the government's bottom line. In the current year Australia Post has to pay to its 100 per cent shareholder-owner, the government, a dividend of $165 million and, additionally, a special dividend of $110 million. So one can see that this organisation makes a very substantial financial contribution to the public as well as providing a community service.I have no doubt that Australia Post's indication that it will raise the standard letter rate by some 5c is in no small part due to the government stripping Australia Post's dividend. Despite all that, the government seems to have some sort of strange ideological obsession about deregulation of Australia Post. Fortunately, through a succession of community campaigns involving the trade union movement and people in rural Australia and elsewhere, the attempt to deregulate postal services has been ground to a halt. But there is a range of new threats. We are aware now of discussions within the context of the forthcoming World Trade Organisation Doha Round, pushed by the European Union—and we know what great free traders the European Union are in all respects of agriculture. The European Union are clearly involved with a campaign to attempt to have postal services and courier services deregulated so that large organisations, such as Deutsche Post or some of the Dutch organisations, which are by world standards very competitive operations, would be able to cherry pick the Australian market.In a country with Australia's particular social and geographic characteristics, there does need to be a properly regulated service to ensure that equity and reasonably priced services are available to all Australians. Yet it would appear as though the government has not yet acted in the way it ought to make it quite clear to the Europeans and others in the context of a further round of trade liberalisation talks that it is not prepared to go down that particular track of further liberalisation. It is simply too damaging to too many interests in this country.There is another threat on the horizon, as well. It arises from proposals that I understand are circulating about setting up franchise outlets for Australia Post. The Howard government, in its postal customer charter, purports that it will maintain a minimum number of some 4,000 postal outlets. We have witnessed the decline of some 56 outlets, I understand, both corporate and licensed post offices, since 1996, and I have referred to the sorts of financial pressures the government is putting Australia Post under in terms of ripping out dividends. It would appear that, in an attempt to further undermine access to postal services through licensed and corporate outlets, there is discussion about creating franchised outlets, despite the fact that Australia Post already has a well-established network of licensed offices. In the context of introducing this franchising approach, there are rumours that up to 600 Australia Post corporate outlets may well be replaced by these new and ill-defined franchise operations. This is a matter that is still entering public consciousness but, in order to protect the integrity of Australia Post, it is a matter on which we need to keep a very close eye indeed. Whilst talking about Australia Post, I want to touch on a local issue. I was quite pleased at the end of last month to see a story in one of my local papers headed `We've got e-mail!' The article said that Australia Post was announcing a $40 million project for Ardeer in Melbourne and that it would centralise 600 jobs as part of what is called a revolution in the infrastructure of Melbourne's mail network. The article said:Ardeer will be the nerve centre for the distribution of parcels, with the processing of letters to be consolidated at what Australia Post called a `state-of-the art' facility at Dandenong.It further states:... the Ardeer facility would use leading-edge sorting technology to expand the capacity of the parcels network.Ardeer will be purpose-built for the e-commerce era. We expect parcels and Internet fulfilment to be the largest growth areas for mail in the future so we're introducing the capacity and technology to take advantage of this. ... ... ...At 25,000m2 square metres the Ardeer facility will be larger than the playing surface of the MCG.For the west of Melbourne, that is certainly good, welcome news. This facility will be located on the Western Ring Road, which has made a major contribution to the infrastructure of the west of Melbourne. But, as the article I referred to indicates, it is associated with the centralisation of mail operations, letter operations being proposed to go to Dandenong. This means that, in the future, Melbourne will have only one letter-handling facility—that is, a city the size of Melbourne will have only one letter-handling facility, with closures of a number of existing facilities. This is hugely inconvenient to many of the Australia Post workers who live in my electorate. It is also not in the public interest, with no capacity in the event of a breakdown for one reason or another in a centralised operation. We have seen in the United States, in the most extreme case, the threat to postal operations by terrorists or hoax style operations—the threat or the reality of introducing chemical or biological agents and the breakdown and massive disruption that occurs to postal services. Hopefully, we will never be looking at a situation like that in Australia. A bit of prudence would suggest that, in a city the size of Melbourne, in a state the size of Victoria, we ought to be looking at some sort of redundant capacity to handle mail services rather than centralising it all in one place on the south-eastern fringe of the city.It seems to me that the Ardeer proposal does offer Australia Post the opportunity to have some letter-handling capacity as well. There may be some greater costs associated with it initially but, certainly, an essential service like post does need to be protected. Since September 11, and even before, we as a community do have to make contingency plans for extreme circumstances. I would suggest that Australia Post ought to have a darned good look at the potential threats that can arise from their reorganisation of aspects of the network in Victoria, to ensure there is some capacity to handle situations when extreme circumstances arise. Of course, there are other reasons why a centralised facility might break down that are short of the more extreme example I have referred to. On that note, I conclude and look forward to hearing the contribution of my colleague from Bass.10:46:003916O'Byrne, Michelle, MPMs O'BYRNE84SBassALP00—The appropriation bills are the legislative manifestation of a government's economic and social plans for our country—a country whose borders, the government says, it must protect at all costs. We all agree with the need for appropriate measures to support the integrity of our borders. We all agree that those who come to Australia must follow the procedures which we the representatives of the people have enacted. But what we on this side of the House do not agree with is that necessary and important programs such as the protection of our borders and the war against terrorism are used simply as an excuse to increase the burden on the disabled and less well off in our community.I fully support the amendment moved by my colleague the member for Jagajaga and, in particular, its condemnation of the government for falsely claiming that cuts to health and welfare payments are needed to fund the war against terrorism and for border protection. That is a monstrous cop-out and, frankly, the government knows it. This is a government that has squandered taxpayers' money by gambling on foreign currency markets. This is a government that spends millions of dollars on advertising itself. Instead of getting its act together and running the country's finances in a responsible way so that there is not a problem when we are confronted by the special measures needed to support the war against terrorism and for border protection, it passes the buck. Who does it pass the buck to? It passes it to the ordinary men and women of Australia and their families. I find it almost impossible to believe how those on the government side can live with themselves when they claim that the attack on Australian families, pensioners and the disabled is justified by the need to fund the war against terrorism and to protect our borders. That is simply not the case and there are other ways. When all is said, the government actually admits that it has other reasons for its agenda. The alternative reason for the increase in the copayment under the Pharmaceutical Benefits Scheme that arises out of the infamous Intergenerational Report—and I addressed this issue during my contribution to the debate on this matter yesterday—is that we need to rein in the cost of the scheme, especially as the Australian population is ageing; I am so pleased the Treasurer noticed. We do not dispute that. But, again, there are other ways apart from slugging ordinary Australian families.The reason advanced for the savings measures in respect of the disability support pension hardly matches the dramatic effect that these harsh initiatives will have. Measures that weed out any people who rort the system, anyone who makes a claim to which they are not actually entitled, should be applauded and supported. But such measures should not be constructed in such a way as to create difficulties, hardship and misery for those members of our community who live their lives every day with a genuine disability. Since these measures were first leaked, my attention has once again been drawn to the very real hardship that will accrue to a large proportion of those with disabilities. It is true that many disabled members of our communities are capable of work; they do not shirk from work if they can get it—provided they can find a job.This is where these proposals are at their most bizarre. The whole concept seems based on the premise that there are tens of thousands of jobs out there ready for those on disability pensions to access. If there has ever been a misguided presumption, it is this one. The jobless rate among all Australians remains, on the May figures, at 6.3 per cent. From the last available Australian Bureau of Statistics comparative figures, which are from 1998, we are told that the participation rate in the work force by persons aged 15 to 64 years who have a disability was 53.2 per cent. This compares with 80.1 per cent for able-bodied Australians. A total of 126,800 people were unemployed. Of those in work, 639,700 were full time and 333,600 were in part-time employment. Disabled Australians are prepared to work, and they do so because they want to assert their independence and make their own way in society. Many do so for their own self-esteem. The majority of our disabled fellow Australians are not trying to rort the system. On these figures, there are simply not enough jobs to go round.If we have a closer look at where those in receipt of disability support pensions live, perhaps we can get a better insight into why the government might be heading in this direction. Of the 22 electorates which have the least number of disability pension recipients—that is fewer than 2,600—10 are held by ministers. The government is making budget cuts where it is not vulnerable at all. Only one of these 22 seats is held by this side, and that is due to the fact that the two seats in the Northern Territory are unusually small in elector numbers at this time. Clearly, this measure will bite less in seats like Bennelong, North Sydney, Warringah, Menzies, Tangney, Higgins, Goldstein, Hughes and Bradfield. Clearly, the National Party has been done over on this one. What are ministers Truss and Vaile thinking in supporting these measures? Their electorates have amongst the highest numbers of disability pension recipients in the country—6,206 and 6,030 respectively. And where are the unemployment rates high? In regional electorates like Wide Bay and Lyne. What are the chances of the disability pensioner finding a job in electorates like these when they are forced onto the dole queues? This is crazy, it is heartless and it clearly has not been thought through by a government which is dominated by ministers from electorates where the measures will actually have the least effect.I know what the effect of this will be because, obviously, unlike members on the opposite side, I have had a look at what it will mean for the disabled people in my electorate. Take, for example, the situation of a young man called Rob. He has moderate cerebral palsy, but it is quite evident to anyone who meets him. He currently works 15 hours and 20 minutes per week as a teacher's aide. He is regarded by his colleagues and the disabled students with whom he works at one of my electorate's upper secondary colleges as an excellent teacher's aide, one who is particularly dedicated to his work. He is a tremendous role model for everyone in our community, particularly in showing what a person with a disability can achieve. But each day that he works he goes home absolutely exhausted. He has worked to his absolute limit. For workers like Rob—and there are tens of thousands who find the going even tougher than he does—there is actually an upper limit to how much work they can do. To extrapolate that just because he and others like him can work up to 15 quality hours they can work full time is simply way off the mark. Because he is a teacher's aide, he is stood down with no pay during school holidays.I am sure we can all begin to see the drastic and harsh consequences that this measure will actually have. What will happen is that the employability of disabled people will plummet. Many like Rob who are not able to work effectively beyond the hours that they currently do will be forced to do so. Their value to and standing with their employers will quickly drop, and their bosses will start to look elsewhere. Then, completely out of work, they will return to the list of the unemployed, but this time they will be $52 per pay worse off if the government gets its way. Australians with disabilities are proud and respected members of our communities. They deserve to be dealt with with the appropriate respect that every Australian deserves, not thrust aside as a means to save the bottom line of a budget of a government which itself has thrown away billions of taxpayers' dollars through irresponsible management. I would like to spend a small amount of time on another issue—that of the provision which the government has made for continuing the fight against drugs in sport. Sadly, today we read in the newspapers of the battle which one of our great sporting stars has apparently had with drugs during his career. Pat Cash has written an autobiography, Uncovered, in which he reveals that he used drugs and contemplated suicide whilst playing at the highest level. According to today's reports, he became so obsessed with winning that he turned to marijuana, cocaine and ecstasy in order to manage injuries and the pain of defeat. He goes on to say, it is reported, that the use of drugs, particularly marijuana, was commonplace amongst players on the circuit. These types of stories are, sadly, not very new. We have an obligation to ensure that Australians who participate in sport at all levels are not subject to these pressures, either for their own wellbeing or, when they reach the highest levels, in their capacity as role models for others.I think we often forget that there is more than one aspect to the fight against drugs. Sensationally, we tried to concentrate on the aspect of testing to weed out the cheats. Despite the fact that the Australian Sports Drug Agency has, without doubt, done some excellent work in this country, not only in testing but perhaps even more so in education, it is appropriate to have a good look at its role and operations. ASDA has two major problems. Firstly, it is placed in a position where it is not totally independent as a drug testing agency. It has got simply too many briefs, some of which invariably lead the agency into conflict of interest situations. The agency cannot be tester, educator and public relations officer all in one. Recently, the international swimming federation, FINA, ceased its relationship with ASDA to do testing on its behalf, citing, it would appear, a question mark about its independence. The second problem for ASDA is its underfunding. It is plainly ridiculous to have a situation where the in-competition testing program in this country is almost totally reliant on the sports themselves.A primary reason for ASDA's establishment was to take the responsibility for testing away from the actual sports. It was said then that the system was akin to entrusting the fox with guard duty at the henhouse. But now it seems ASDA has to tell sports that in-competition tests have to be primarily funded by the sports at $542 a pop. How many sports in Australia, outside the major professional codes, have the available funds to run an effective program of deterrence? Whether they choose to conduct tests at all and, if so, the particular competitions they select, brings into question the very issues of objectivity and independence that ASDA was set up to avoid.Whilst out-of-competition testing is rightly considered to be a more appropriate tool to weed out the cheats, we should not let those who cheat on the day get away with it. Such a scenario opens the way for those not currently on a sport's out-of-competition testing list to dope up to their hearts' content until such time as their performance calls them to be added to the broader testing list. By then, extensive damage can be done not only to the doper but, more importantly, to their opponents, who have been unfairly disadvantaged. The consequences can be significant.If Australia remains serious about the fight against doping in sport, our agency must be streamlined in terms of its roles and much better funded to maintain a truly effective, independent and well balanced testing program. We must educate our fellow Australians, particularly our young Australians embarking on sporting careers, about the evil of doing drugs in sport. But, at the same time, we must be able to convince them that they are actually on a level playing field. We must do all that we can to remove the temptation. This government by their budget have shown a contempt for people with disabilities and for those on low incomes. They have also shown their inability to grapple with issues such as those in our sports industry and in many areas that I have not touched on today. This budget shows their lack of vision for our nation and, quite frankly, their inability to lead us effectively in this new century.10:57:003919Gibbons, Steve, MPMr GIBBONS83XBendigoALP00—On Tuesday, 14 May, Treasurer Costello brought down his seventh budget. People throughout regional Australia could be forgiven for hoping that, out of the seven budgets he has delivered, he may have just got one right. He did not. This budget was all about the past, squaring the ledger for the taxpayer funded spending spree that the government indulged in to buy themselves back into office at the last election. This budget should have been about Australia's future and, in particular, regional Australia's future. It was not. It should have funded much needed infrastructure projects, like the Wimmera-Mallee pipeline and the Calder Highway, and rail and other transport infrastructure. It did not. The Treasurer should have provided appropriate funding for education, aged care and housing. He did not. What he did was mug regional Australia, just like he mugged the sick, the poor and the disabled, to pay for his gaming debts and for the spending extravaganza he pulled out of a hat to win the election. He squandered almost $5 billion punting on the foreign currency markets. Treasurer Costello is a problem gambler and a mug punter. The Treasurer, without any consultation or warning, mugged Australia's printing industry by removing the Printing Industry Competitiveness Scheme, which should have continued for another two years. In small communities that rely heavily on the jobs provided by the book printing industry, like Maryborough in central Victoria, this was a particularly savage mugging. Maryborough's printing industry is one of the most efficient in this part of the world and is responsible for producing quality products right here in Australia, like the very popular Bryce Courtenay novels and the extraordinarily popular Harry Potter series.I am reminded that there could be a whole series of Harry Potter novels based on the evilness that is portrayed by this government. In fact, the first story could be called `Harry Potter and the Treasurer's Tome'. It could feature a tri-wizard scenario, with Lord Johndemort of Bennelongknife, the king and prime minister of all wizards, and Costellotto, the illusionist who specialises in making GST compensation disappear. This half-witted wizard of Higginswarts masquerades as a fiscal genius but is really just a dunce who keeps running around prodding other members of Lord Johndemort's court with his magic leadership wand and then tripping over it. Let's not forget Abbottsmeade, the schizophrenic wizard of hypocrisy, a particularly poisonous and nasty wizard whose venom is spreading throughout the court of Lord Johndemort. In fact, the plot might even go like this: once upon a time, there lived the country's most evil prime minister of all, Lord Johndemort, who was in danger of losing his kingdom. So, with help from Costellotto the Halfwit and Abbottsmeade the Hypocritical, he brews up a nasty concoction of evil and deceit against people from a faraway land who are fleeing wickedness in their own country.Lord Johndemort tries to portray the people from the faraway land as even more evil and menacing than he is, so he weaves a web of deceit by implying that the people from the faraway land had tried to drown their own children, and pretends he is saving his kingdom from attack by these evil aliens. Of course, all he is doing is trying to save himself and keep his grip on his throne. This story has a very unhappy ending: Lord Johndemort's concoction of evil and web of deceit actually save his kingdom, and Costellotto the Halfwit and Abbottsmead the Hypocritical set about brewing their own competing evil concoctions to be ready for Lord Johndemort's 64th birthday bash—or should I say `bashing'.In the printing industry what has happened is that the Treasurer waved his magic leadership wand, chanted the word `Abracadabra', and another GST compensation scheme disappeared in a puff of smirk. What other evil do these coalition dementers have in store for our book printing industry? It is called the Copyright Amendment (Parallel Importation) Bill 2002. This bill will decimate the industry even further by allowing a flood of imports to be dumped onto the Australian market. More evil and more sorcery. What magic formula will Costellotto, the sorcerer's apprentice, invoke to pick up the pieces once his wizardry has shattered Maryborough's book printing industry—more abracadabra, more incantations or more sorcery?This evil Treasurer has ignored vital infrastructure projects in regional Australia even after the coalition candidates had led everyone to believe that they would be funded. I refer to the Wimmera-Mallee pipeline, a project that has been in the pipeline—pardon the pun—for many years and would have delivered enormous benefits to the people of the Mallee district if the Commonwealth had matched the Bracks government's $77 million commitment which it made in its recent state budget. In fact, the member for Mallee made securing the funding for this project a key component of his re-election campaign. I quote from one of his many press releases on this issue. It is actually the final message during the campaign from the member for Mallee. It states:There are four key policies in John Forrest's bid for re-election at the November 10 election.They are piping of the entire Wimmera Mallee system, telecommunications in regional areas, fixing of local roads and better viability funding for aged care services.This is a big task that the budget has produced. Mr Forrest's ongoing commitment to getting the remainder of the Wimmera-Mallee's wasteful open channel system piped has led to his nickname in federal parliament of `Mr Pipey'. `Mr Pipedream' would be a more appropriate description for the member for Mallee, because the coalition has no intention of funding it. With $3½ million in paperwork and the Bracks government's $77 million, the project could be almost finished within a couple of years, but the coalition refuses to fund it. There is no mention in the budget of funding the project, apart from the paltry $3½ million for planning. The coalition led everyone to believe that this was a priority, and then walked away after the election.I refer now to the ADI defence manufacturing operation in Bendigo, and the shocking way this coalition government is treating it. The operation has now lost 250 jobs because of the privatisation inflicted upon it by the coalition. Bendigo is still waiting to find out whether ADI Bendigo will manufacture the Bushmaster vehicle. Bendigo people were outraged to discover that the former defence minister, Mr Reith, after the election had fixed himself up with a job—no doubt a well-paid adjunct to his handsome retirement income as a former minister—and left ADI jobs on the line. Mr Reith secured himself a job as a lobbyist working with Tenix, a rival of ADI, and left ADI Bendigo in limbo. He promised in Bendigo during the election campaign that a lot of the technical problems the government was blaming on ADI for the stalling of construction of the Bushmaster would be fixed in the next few months, `perhaps by Christmas'. They were not. All that was fixed by Christmas was Mr Reith's own job as a lobbyist. This is what Mr Reith said in Bendigo on 29 October: Good progress has been made and in the next couple of months, perhaps by Christmas, we should have a lot of these issues finalised.They have not been. Mr Reith's successor, Senator Hill, promised in March this year that a decision on the Bushmaster would be announced within two months. The two months were up on 22 May. Bendigo is still being kept in the dark. The ADI workers' jobs are still on hold. This is a disgraceful situation—but this is a disgraceful government. Again, it says one thing during the election and does the other thing when the election is out of the way.In central Victoria we are only too well aware of the government's dazzling record of broken promises. The let-down of Newstead district looks like being a rerun of the government's broken promise to Bendigo in the 1996 election. The government at that time promised that they would pay the City of Greater Bendigo $2 million towards the cost of redevelopment of the Bendigo Art Gallery. We are still waiting. Six years later, this money still has not been paid to the City of Greater Bendigo, and ratepayers footed the bill for the government's broken promise. Only a fraction of the funds promised to Bendigo have materialised to date. For years, the government even claimed that they had never in fact made the promise. When they actually do get around to honouring that commitment, I can just see the headline: `Government honours promise that it never made'. The funding for Bendigo was supposed to come from the $3 billion Natural Heritage Trust Fund, a fund built up from the partial privatisation of Telstra and the destruction of hundreds of public sector jobs in Castlemaine and Bendigo and around the Maryborough district. That fund was just another coalition slush fund used to pork barrel National Party seats.There are other instances where the coalition has let down regional Australia, and in particular regional Victoria, but none so obvious as the privatisation proposal for Telstra. During the election campaign we had a situation where coalition MPs fighting in marginal and other seats were saying that there would be no full privatisation of Telstra until such time as the services in regional Australia were up to standard; they are not. On the other hand, we had the Treasurer saying during the election campaign, and in fact factoring in the proceeds from the full sale, that it was going to happen anyway. So we had all of this confusion.The coalition MPs from regional seats remind me of a flock of frightened and bewildered sheep being kept together in a close bunch by the Liberal cabinet dogs, who are running around this flock, barking and snapping at their heels, pushing ever closer to the full privatisation of Telstra. Every now and then, one of these frightened and bewildered sheep, usually a National Party sheep, gets spooked and it runs off from the flock in the other direction only to be run down by the Liberal Party dogs—or should I say `dog'—turned back to the flock and pushed closer and closer to the full sale of Telstra.I am delighted that some National Party people are expressing major concerns about that, because it is a major concern. But the National Party have never been known for their intestinal fortitude. That great comedian the Sandman once described the National Party as the `pilot fish of Australian politics'. For those of you that are not up with aquaculture, a pilot fish is a very small, insignificant, insipid, little fish that spends its whole life attached to a far bigger, far more important fish so it can feel important too. That sums up the National Party perfectly.11:07:003922Corcoran, Ann, MPMs CORCORAN009CWIsaacsALP00—I listened to the Treasurer deliver his budget speech with some interest. He took 30 minutes to deliver his speech on budget night, and it was intriguing to me that he spent more than one-third of this time—over 10 minutes—talking about the war against terrorism and about protecting our borders. Maybe he was softening us up. Maybe we were supposed to then accept what was to come with some relief that it was not worse. If we are to believe the Treasurer, Australia's budget is now in deficit because of the war against terrorism and because we have to take extraordinary steps to protect our borders.Two points come out of this for me. The first point is that this is contrary to what the Treasurer was saying last October. Last October, the Treasurer was saying that all of those costs associated with the fighting force and surveillance force were factored into the budget. He was saying that the government would keep the budget in surplus. In other words, he was saying that the increased costs associated with the government's panicked reaction to asylum seekers and the increased costs associated with antiterrorism actions were all covered by the budget and the budget would still be in surplus.But it is a different story now. Now we are being told that the budget is in deficit and that it all has to do with terrorists and asylum seekers. The facts do not support that assertion. If there had been no extra money spent on border protection and defence, the budget would still be in deficit. It is extraordinary that this government that like to promote themselves as being good economic managers turn in a deficit budget despite a growing economy and despite being the highest taxing government in Australia's history. Australians pay more in income tax now than ever before, and this is despite the tax cuts of two years ago that were supposed to compensate for the GST. It is a mystery that such good economic managers can manage a growing economy but still not manage to improve our unemployment rates. We are losing full-time jobs and gaining casual and part-time jobs. This is fine for those who want to work part-time, but many people are forced into casual jobs and all of the insecurity and uncertainty that comes with this sort of work and the income that goes with it as well. The second point that strikes me about this budget and the budget deficit is that we are being told that the way to attack this deficit is to attack some of the most vulnerable people in our community. The government is attacking some of these vulnerable people by increasing the costs of medicines by 30 per cent. It is attacking disability support pensioners and other low-income workers. Those on a disability support pension have been hit hard and cruelly by this budget. The government's justification for the cuts is that this will encourage and indeed assist many disability support pensioners back into work, the implication being that these pensioners are choosing not to work in the first place. Even if we accept that premise for just one minute, the budget announcements do not support the contention that this move will encourage those pensioners back to work. The budget papers themselves show that assistance for these people is not available—that there are no more funded places in Job Network. But the premise that many pensioners are choosing not to work is wrong. I am not saying that there are not some people out there who are abusing the system—I am sure there are some people abusing the social security system—but let us not forget those people who are abusing the system by not paying their full share of taxes.What worries me about this change is the detrimental effect it will have on the many thousands of people who are genuinely doing their best to contribute to society but who need some help along the way—for example, a disability pensioner who suffers anxiety and who is slowly getting herself back on her feet after several periods of hospitalisation. This is a gutsy lady who has found part-time work and is learning to drive. She has gained a degree of confidence in herself. She is now very worried about her future, so much so that her health is under threat again even before she knows whether or not her pension will be cut. Another constituent came to see me. He has a physical disability that makes it very difficult for him to stand and he wants to know if he is going to be expected to stand for hours every fortnight in the queue at a Centrelink office. Another constituent cannot read or write easily. He has come to see me as the thought of facing a multitude of forms on a regular basis is rather frightening. This cut is callous and uncaring. The stated purpose of the action does not stand scrutiny and the real reason for it—a disregard for those in real need of support from society—is frightening, not just for the people directly affected but for all of us.Let me turn now to the Pharmaceutical Benefits Scheme. We are being asked to accept that the cost of the PBS is spiralling out of control. In recent years the PBS has typically risen in cost by about 10 to 12 per cent per year. Last year the increase was more like 20 per cent and most of this was of the government's own making by listing drugs against the advice of the expert committee and by extending concession cards to more people. It is very interesting to note that these actions were taken last year—an election year. It has been estimated that if these self-inflicted wounds were removed the cost of the scheme would have decreased by about 12 to 14 per cent—in other words, back to where it has been for the last few years. So we are now in a position of having to bail out these costly actions and the government is putting the bill at the door of those least able to afford it.I have heard members opposite argue that this increase is okay for a number of reasons. I have heard the argument that it is okay to make these big increases because the copayment is still substantially below the actual cost of some drugs. The logic seems to be that, where a consumer is prescribed an expensive drug but only pays the copayment, somehow the 30 per cent increase in the copayment should be gratefully accepted and somehow the extra $6.20 per script can be found easily. The relevance to the family budget is the increase in the level of the copayment, not the gap between the copayment and the total cost of the drug. It is illogical to suggest that a family or a person on a tight budget that goes into a chemist and notes the 30 per cent increase in the cost of the medicine is suddenly able to find an extra $6 because the actual cost of the medicine is far more. Each year about 200 million scripts are written and, of these, 20 per cent do not go to the copayment rate. This means that 80 per cent of scripts are at the copayment rate. About 300,000 people will pay another $190 per year for their drugs and about one million pensioners will pay another $52 per year.In the scheme of things the most powerful influence on money spent on pharmaceuticals is the manufacturer and the least powerful influence is the patient. The manufacturer wields influence and power over the industry through marketing programs directly both to the consumer and to the doctors. The manufacturer, the doctor and the pharmacist all wield far more influence over the cost of the PBS than does the consumer. These people influence very strongly what drugs are prescribed, how many and to whom. It is curious, therefore, that the way this government has chosen to fix this perceived problem is by tackling it through the least effective player—the consumer.The typical consumer or patient does not decide what drugs to take or even whether they should take any. Usually the patient does not have the knowledge necessary to make informed decisions about their medical care. If the government were truly concerned about the perceived problem of the increasing cost of the PBS it would be addressing it via the stronger players—the manufacturers and the doctors—not by having a go at the weakest link. This proposed increase in the copayment imposes the burden on those who can least afford to cope. The proposed increase will not actually affect the root of the problem. This proposal to increase the cost of medicines is a diversionary device by the government to take attention away from some of the real reasons for the increase in the PBS over the last year. The real reasons have a lot more to do with the government being re-elected and finding someone to pay for those re-election activities. I would like to spend a couple of minutes talking about superannuation. At the same time as we are cutting disability pensions and increasing the cost of our medicines, the top three per cent of income earners are getting a tax cut. At the same time as that is happening, our lowest income earners are effectively getting an increase in tax or a reduction in income. For a long time the Labor Party has advocated the need to move to quarterly payments for the superannuation guarantee contribution. That is because at the moment employers do not have to pay the SGC for 13 months after the money has been earned. The government has moved to do that, which is good. At the same time it has moved to change the limit for income from $450 per month to $1,350 per quarter. That sounds the same, but it is not. Let me give you the example of a casual worker who earns $500 for each of two months and then $300 for the third month. This person would have SGC credits of $90 given to them under the current system, and on 1 July it will move to nine per cent. Under the new system that person gets nothing. The government just cannot help itself. It never misses a chance to take a bit away from those who can least afford it.I want to talk about telecommunications for a few minutes. Telephone communication is not like cosmetic surgery; it is essential. Without an effective telephone service and dependent communications facilities, including new developments that are coming on all the time, Australians will not be able to fully participate in the 21st century. Country people and those who live on the fringes are particularly vulnerable. We have already seen the unfortunate results when governments have imprudently withdrawn from participation in essential services. By relying on market forces or perhaps profit motive alone, we have witnessed and suffered from bank closures and higher charges, turmoil in the airline industry, astronomical costs for new pharmaceuticals and erratic petrol prices that go up and down without any real competition. Some needs may very well be provided by business competition, but essential services that require extensive facilities such as health and communications cannot be left to companies that must focus on maximising profit. We have seen pair gain technology used to the detriment of consumers. Telstra customers are losing out by being given a second-rate service. That happens when a customer asks for a second line, often for Internet connection purposes. A customer may often have their existing line simply split into two. That halves the speed of the service and causes all the attendant problems that go with that.People who live in Cranbourne in my electorate are living another reason telecommunications need proper regulation. Cranbourne is still on STD rates whilst many communities around it are on Melbourne rates. This includes communities further distant from Melbourne than Cranbourne. The map depicting the STD boundary around Melbourne does a nice sweep until it gets to Cranbourne, where suddenly it juts in to exclude Cranbourne from the Melbourne area.Aged care is another matter that concerns me. I have been told over and again by constituents and by health care professionals about the problems in aged care. In essence, the problem is a shortage of beds and a lack of various support funding for things like respite care and care provided in the home. These are exacerbated by the shortage of nursing staff and the complex accreditation system. The accreditation system is time consuming and focused on problems and funding rather than the health outcomes of the residents. This budget is doing very little to address any of these factors. I was talking to health professionals recently when I heard again about the problem of the aged care patient sitting in an acute bed, waiting for a nursing home bed. That is a problem because the bed could and should be used for an acute patient. It is a problem for the aged patient because, despite the very best efforts and intentions of the hospital staff, they are not getting the appropriate care that they need. An aged patient, for example, often needs regular walking and personal contact to maintain physical and mental health.I have personal experience of watching a patient's mobility slide downhill rapidly while in hospital because no-one had the time to get her out of bed and take her for walks. At the same time, the assessment team was judging this patient's mobility and giving her a rating that she did not deserve or which was not truly reflective of her abilities—simply because she was on the ever diminishing circle of not being exercised and therefore losing her mobility.This is made worse by the reality of phantom beds and the outrageous claims by government that there is a fall in the estimated demand for residential aged care services. This so-called reduced demand is a direct result of the government not insisting that those with bed licences actually build and open those beds. One could speculate about why the beds are not being opened, and evidence I have been getting is that the funding attached to the licences is not adequate to run a nursing home properly. You cannot blame a potential operator for being reluctant to get into business if it is not going to be viable, but I am critical of those who hold licences— A division having been called in the House of Representatives—Sitting suspended from 11.21 a.m. to 11.38 a.m.009CWCorcoran, Ann, MPMs CORCORAN—Before the suspension, I was talking about aged care. I was making the point that there are phantom beds in the system and wondering why this could be the case. I do not blame a potential operator for being reluctant to get into a business that will not be viable, but I am critical of those who hold licences and are not taking steps to either use these licences or pass them back. I am also very critical of the government for allowing this situation to develop and be sustained. We have a situation where licences are out there but not being used. This of course allows the government to claim credit for creating new beds when it is not actually having to pay for them. At the end of the line, we have the poor old patients and their families being totally ignored by this outrageous process. The 2002 budget paints a stark contrast between the government's mean attitude to the disadvantaged in our community and its attitude to its industry mates. The budget allocates $125 million to the large multinational company Rio Tinto to `assist Rio Tinto to commercialise new iron smelting technology'. This new technology may well be a wonderful advance for Rio Tinto, but this company is big enough and profitable enough to pay for its own development projects, especially when the government has dragged Australia down into deficit to get itself re-elected. This grant amounts to approximately 40 per cent of the funds the government will claw back from disability pensions—straight out of the pockets of the people with disabilities and into the coffers of Rio Tinto. This grant is being made under the strategic investment program of the Department of Industry, Tourism and Resources. The program is far from transparent in terms of who gets assistance and why. The guidelines are far from clear. So why was Rio Tinto lucky enough to score $125 million of taxpayers' money? It is very interesting to note that Rio Tinto has been a forerunner of the government's industrial relations agenda. It has pursued protracted disputes in both the Hunter Valley and the Mount Thorley mines to de-unionise its mining sites and to force every worker onto an individual contract. It is a nice pay-off if you can get it.In conclusion, this budget is more about recovering from and recouping pre-election spending. It is not about caring for Australians. It shows no thought for the long term and it is very damaging to the vulnerable members of our community.11:40:003926Plibersek, Tanya, MPMs PLIBERSEK83MSydneyALP00—I rise again today to speak about an issue that I have addressed in this place before—that is, the failure of this budget to provide for an increase to workers who are covered by the social and community sector award in New South Wales. Before the budget we had very high expectations that perhaps Minister Vanstone would announce during this budget that the federal government had found its share of the increased cost of paying wages for these workers. In November last year the New South Wales Industrial Relations Commission granted an increase to workers who work in services such as women's refuges, drug and alcohol counselling, disability services, meals on wheels, home and community care, and the sorts of services that take elderly or infirm people shopping or to do their banking. All of these services are facing grave financial difficulty because their workers have won a very well-deserved pay increase after over two years of negotiations in the New South Wales Industrial Relations Commission. This small, well-deserved increase is very difficult for services to find because they are already running on the smell of an oily rag.Within a week of the pay increase being awarded to social and community sector workers, the New South Wales government agreed to find $112 million over three years to pay for the increase in those services that receive or rely on state government funding. Its reasonable expectation was that the federal government would find its share of the increase, which is something less than $70 million over three years—indeed, it was only projected to be $24 million in the first year. This, of course, is a very small amount in a budget of $150 billion. I think that all of the workers in this sector, including in disability services, drug and alcohol counselling services and women's refuges, had a very reasonable expectation that that money would be found in this federal budget. I am incredibly disappointed that the money was not found, as I know they are.I know that today there will be a number of people protesting at the front of Parliament House to draw attention once again to this problem. It is a tragedy that we have to have people with quite severe physical disabilities catching buses to Canberra to try and convince members of parliament that this tiny amount of money should be provided to keep their services open. What we are facing in New South Wales is services actually closing their doors. Already in a number of instances the New South Wales government has stepped in to provide funding to keep services open that would otherwise have to close their doors, but this is not a sustainable long-term option. Where the federal government has made a commitment to fund services, it has to fund the whole cost of that service. With something like a wage increase it is completely unreasonable to expect another level of government to pick up the Commonwealth's responsibilities in that area. The type of work that these workers do is amongst the most difficult, underpaid and undervalued in our community. I really would have liked to see in the federal budget some recognition of the type of work that they do. We are talking about people who perhaps work with disabled clients needing 24-hour care. There is heavy lifting, bathing and dressing involved; there are clients who have behavioural problems. It really is some of the most important and undervalued work in our community. It seems to me that the message the government is sending by not providing this increase in the federal budget is that this sort of work is not valued. More importantly still, that is the message being sent to the clients of these services and to the families of those people, who are being told that their family members do not matter. I have had any number of letters, not only from constituents in my area but also from people around the state who have children in services—often adult children in disability services—who fear that their adult children will no longer receive the help that they have been given up to now.I want to draw the attention of my colleagues to some of the correspondence I have received. One letter was from Margaret and Keith Withers, who talked about their son who has for nine years been involved in a program in Wagga called Community Access Support Services. They say:During the nine years that our son has been attending CASS friendships have been forged not only with staff but a wide section of the community. CASS have offered a high level of competent service enabling a chance to integrate with the community as a whole. If CASS was to close due to funding difficulties not only would he lose these valued friendships but a void would be left in his life a void that we would try but could never fulfil although try as we might.This would mean that he would fail to reach his full potential and a quality of life that every Australian deserves.I think that is the point we need to emphasise: these people are not asking for special treatment; they are asking for some care that enables them to lead a life, and that is something that most people would take for granted. I have had another letter from the parents of Jason—the signatures are a little hard to read. Jason is 25 years old. He also attends this Community Access Support Service in Wagga. His parents believe:He will lose the valuable skills he has worked so hard to acquire (eg cooking, computing skills, recycling). He needs constant practice to maintain them. His quality of life will be diminished. He will lose stimulating tasks and occupations that give him self-esteem. He will lose his sense of worth. He will lose his vitality, which will be replaced by boredom and stagnation. He will be lonely and lose social interaction with peers and carers. He will lose his friends. He will lose his independence from his parents that he has gained by attending CASS. This independence, though limited, is imperative to help him maintain dignity in his adult life.Maryann Wakem is another parent whose son Lyndon attends this service. She believes that either she or her husband will have to give up work to care for Lyndon if this service closes down. I have had another letter from Lorraine Tye, who says that if CASS were to close her son would be in her care 24 hours a day. That is very difficult for her because she has post-polio syndrome and wears a caliper. Her son, at the age of 27, is of course too heavy for her to lift and would be required to stay in bed for most of the day—for a 27-year-old man that is not a very good future for him to look forward to.I have had a number of letters from that service. I have had letters from the Windgap service, which provides services to people in my electorate. There is the case study of a woman they call Jenny—of course `Jenny' is a pseudonym. She has lived in her group home, with four other people, for 15 years and is happy there. They do lots of things on their own but they need the assistance of a staff member. Jenny requires a high level of personal care to live in that home and she needs one-on-one support from staff or family to be able to go out into the community. She also needs a staff member to help her to visit her own family. The sort of support that we are talking about is personal care and mobility—two of the four people are in wheelchairs. They need someone with them when they go out into the community. Sometimes they exhibit challenging behaviours. Many of the four need special care with medical assistance and they need assistance with feeding as well. This is the sort of independence for people with disabilities that we have strived for, as a community, over so many years. We have passed on the responsibility to the community sector, and they have accepted it graciously. They work incredibly hard to provide these services and they do an enormous amount of fundraising; they are asking for the government to pay its share of their wages bill. It really disappoints me to be part of a parliament that is not taking up this burden. Some of the public comments that have been made in public in response to this issue have also alarmed me. The Prime Minister said in response to the social and community sector award increases that Bob Carr should keep a tighter rein on the New South Wales Industrial Relations Commission, and that they should not go around granting these enormous increases to community sector workers. I think that is an affront when we consider the sort of work that these people do. You are talking about people who work full time in a very emotionally and physically demanding area, and who are paid in the mid-$20,000; $24,000 is not a lot of money for someone who is working full time in this incredibly important area. To say that these workers are overpaid is phenomenal. No-one who has ever gone out and seen the sort of work that is occurring in disability services, in home and community care, in drug and alcohol counselling, and in women's and youth refuges could say that these workers are overpaid. How much do you have to be paid to deal with a client in a women's refuge when her husband is out the front banging on the door and saying, `I'm going to get in and kill you all'? What sort of work are we asking these people to undertake for $25,000 or $30,000 a year? It is phenomenal.Senator Vanstone has claimed, as has Minister Anthony, that the federal government has already indexed these payments. It is true that there has been some small indexation, but we are talking about indexation in the order of one or two per cent, which has been very quickly swallowed up by increased costs such as insurance premiums. We know that the insurance crisis is affecting all sorts of areas; it certainly has affected people providing services to vulnerable people in the community. There have been safety net wage increases over a number of years that have affected the lowest paid workers in this sector. They were spent long before the New South Wales Industrial Relations Commission ordered the improvements to the award that they ordered in November last year. To say that these organisations should have somehow been saving or stockpiling money is an absurdity when we know how much unmet demand there already is in the community for these services. It is not enough to say that there has been indexation, because that indexation has been very properly spent in the past on the sorts of expenses I have just mentioned.The most alarming comment I heard came, however, from the member for Wentworth, who apparently said to a delegation of people from his electorate who had come in to see him about this issue that workers in this sector were overpaid and what they did not realise was that he had to take a pay cut to go into parliament from his previous career and that really they should get some perspective and not complain about the pay they are receiving. I certainly do not want to get into an argument about whether parliamentarians are under or overpaid—that is an endless argument and there are no winners there—but for someone who is paid at the level we are to tell workers who are paid $25,000 or $30,000 a year that they are overpaid for working with people and children with disabilities, people who are struggling to give up heroin, women who are escaping domestic violence and children who are escaping violent homes is stunning. These are people who are taking elderly people shopping or to do their banking, people who are working in community legal centres. There is an absolutely stunning inability on the part of the government to see the value of these workers in our community.Instead of this government making excuses for finding the $70 million over three years that is required to fund this wage increase properly, I would like to see some movement from them. I hope that movement will occur shortly. I know Senator Vanstone, as the Prime Minister said yesterday in question time, has prepared an options paper. I hope that option A is `fully pay the social and community sector award pay increases to those workers in New South Wales'. We are talking about $24 million in the first year. This is one month's government advertising from the pre-election period. If the government can spend $20 million a month on advertising programs, they can spend $24 a year on protecting the most vulnerable members of our community. 11:55:003929Rudd, Kevin, MPMr RUDD83TGriffithALP00—The budget of the Commonwealth of Australia is about the provision of resources for what we as a nation do—for not just our current circumstances but our long-term national circumstances as well. In a budget we allocate resources that will enhance our nation's security, we allocate resources that will enhance the strength of our economy and we allocate resources in order to construct the architecture of a fair society. One of the elements of building a secure and economically strong Australia lies in how we go about sustaining our comprehensive engagement of the Asian region of which we are part. One of the ways in which we can do that is by ensuring that the next generation of Australians is comfortable in the languages and cultures of our region. One of the ways in which that is done in turn is by ensuring that, through the school systems of the nation, we provide a comprehensive opportunity for Australia's young people to become familiar with the languages and cultures of our neighbours, the languages and cultures of our principal economic partners, and the languages and cultures of those who fundamentally shape the security policy environment of this country.These were the considerations which were brought to bear a decade ago when the Council of Australian Governments, under the chairmanship of Prime Minister Keating, issued a communique which called for the creation of an intergovernmental working group to draft a long-term strategy for the teaching of Australian languages and cultures in Australian schools in a direction that would enhance Australia's long-term economic management. The COAG report, which was commissioned by that communique, took over 12 months to construct. It was put together by an intergovernmental working group chaired by the Queensland government. I represented the Queensland government in chairing that report and the working group comprised representatives from the other five states, the Commonwealth and the two territories. The report took more than 12 months to put together—it was a difficult document to obtain agreement on because the scope of its recommendations was extensive and long term. One of the things that the report commissioned was a long-term economic forecast from the Economist Intelligence Unit in order to establish precisely where Australia's exports interests would lie, not in 1992 but looking ahead to 2002, 2012 and beyond. What that report found was that, by the time we reach 2012 and beyond, our principal economic partners in the world would be China, Hong Kong, Taiwan, Singapore, the Republic of Korea, Indonesia and Malaysia—and, in addition to that, the European Union and the United States. But seven or eight of our 10 principal economic partners, according to that long-term forecasting exercise, would lie within the Asia-Pacific region—in East Asia, in particular. The recommendation which came forth from the report was that we needed to create a generation of Asia-literate Australians that would be comfortable in the languages and cultures of our principal economic partners. That is why the report recommended that, for the future, the priority funding from the Commonwealth and the states for language teaching in schools should be directed towards Mandarin Chinese, Japanese and Korean, as well as bahasa Indonesian and bahasa Malay. That report was adopted by the Commonwealth, the states and the territories in 1994. It initiated an intergovernmental agreement which was to last 12 years—a long-term bipartisan project involving the Commonwealth and the states—Labor and Liberal governments and governments which, by that stage, had not even been elected. The whole purpose of it being long term and bipartisan was that the yield to be obtained for the nation through such a long-term program would only be realised once you had children through the primary school and children through the secondary school having a long-term and sustained opportunity to invest the hours and the effort necessary to master these difficult languages.Of course, by the time a child reaches year 12, mastery, inevitably, has not been obtained, but a basis upon which the child can then go forward and undertake postsecondary studies in-country or at university is significantly enhanced. It was a pathbreaking report. It was pathbreaking in the sense that governments since the prime ministership of John Gorton had commissioned reports on the importance of enhancing the teaching of Asian languages in Australian schools. Sixteen reports had been put together by various commissions and committees, commissioned by the Commonwealth government in the period from Gorton to that COAG report of 1994. Sixteen reports which, within a year or so of having been constructed, then, as is the habit of many such reports, began to gather dust on the shelves and not become the basis for sustained implementation across the Australian school system. That is what made this report—the COAG report of 1994—such a fundamental shift in the way in which we did these things.The problem we now face is that in the most recent budget the new education minister, Dr Nelson, has stated unequivocally that the Commonwealth will cease funding this long-term strategy. The funding arrangement for the strategy was to be a shared agreement between the Commonwealth and the states, a 50-50 tied grant. In other words, to encourage long-term sustained commitment from the states in the direction of the teaching of these priority languages, the Commonwealth had to put its hand in its kick and demonstrate that the Commonwealth was serious. That is why we have had such a sustained funding effort directed in support of this program over the last eight years. But through the Commonwealth statement through Minister Nelson at the time of the budget that this is the end of the road, I fear greatly in terms of what will happen in the schools across this country to our ability to sustain the teaching of these languages effectively into the future.The yield which has been obtained by this program over time has been substantial indeed. Honourable members will be interested to know that as of the year 2000—that was barely six to seven years into the implementation of this strategy—we had, in effect, three quarters of a million students across Australia studying these four priority Asian languages; the precise figure being 767,281 students—539,000 in the nation's primary schools and 227,000 in the nation's secondary schools. We had 419,000 students across the nation studying Japanese; 787,000 studying Mandarin Chinese; 265,000 studying Indonesian and 3,672 studying Korean. This represented a significant achievement, given where we had come from. The number of students studying these languages is obviously reflected in the number of schools which have implemented programs in support of these languages. Again, the statistical record of this program is worth recording for the Hansard. By the year 2000, we had 3,287 government schools, 864 Catholic schools and 534 independent schools across Australia teaching these four priority Asian languages. A total of 4,685 schools across Australia were teaching these four priority languages that are of fundamental importance to Australia's long-term strategic and economic interests—2,276 schools teaching Japanese, 1,795 schools teaching Indonesian, 569 schools teaching Chinese and 45 schools teaching Korean. Beyond student numbers and the schools now teaching these languages, there have been fundamental changes in the way in which we have gone about curriculum development supporting this language education. We now have online curriculum support for Chinese, Japanese, Indonesian and the studies of Asia. We have CD-ROMs: the Japan Album, the China Album and Album Indonesia. We have satellite programs, completed and now broadcast daily on SBS television. Through this initiative over 120 hours of programs for primary learners were developed in both Chinese and Japanese. Thirty hours of programs were also developed specifically for secondary learners. We have also had curriculum development in terms of texts for Chinese, Languages Through Movement for Chinese, Japanese and Indonesian, as well as other texts for Korean. In the case of New South Wales, we have HSC Online for Chinese and Korean and also a range of other fundamental curriculum innovations, the most important of which in overall terms is probably the fact that we now have an integrated K-6 syllabus for the four targeted languages and the fast tracking of a new K-10 syllabus for these targeted languages.Prior to this strategy being implemented, none of this syllabus or curriculum material was available. It has been funded as a consequence of the concerted efforts of the Commonwealth and the states over the last eight years. When we go to the individual states themselves, the records are also impressive. In the state of New South Wales we had, for example, in 1994 only 7,000 Chinese language students. In 2001, we had 16,000 Chinese students. We have also had significant teacher training and curriculum development in the state of New South Wales.We have newly appointed teachers of languages and, through the secondary induction program, we now have provided induction for 123 newly appointed teachers. We have also the language teacher training initiative, which provides funding for teachers of languages to upgrade or undertake tertiary study in the language they are teaching. There have been 961 grants under this initiative. We have overseas study awards, enabling 292 students since 1995 to undertake intensive language study overseas. We have now the appointment of assistant teachers, who work in the classrooms—invariably native speakers—to assist full teachers. These assistant teachers receive half salary.We have the languages continuity initiative, which is specifically designed for schools, from 1999 to 2002, to provide languages for years 5 to 6 on a continuity basis through to years 6 to 7 and beyond. Currently, 183 schools across 31 districts enjoy support from this program. We also have the Japanese Language Centre in Sydney, with more than 5,000 paying visitors, in support, on a free basis, of a large number of schools across New South Wales, partly funded by NALSAS. The implications of the withdrawal of NALSAS funding will be significant. We will see Indonesian and Korean positions reduced or terminated. The languages continuity initiative is likely to be brought to a halt as that currently depends on $1 million per year of funding to schools across New South Wales. We may well see the demise of languages programs in the majority of primary schools involved in the LCI. Also, there is a grave danger that the majority of other programs currently supported through NALSAS across New South Wales will be withdrawn. With the loss of NALSAS funding, curriculum development for targeted languages will no longer be possible and the language centre itself will now have to move on to an economic self-sufficiency basis with fees being charged at a greater level for government schoolchildren participating.When we look at Victoria, in 1994 we had 75,000 students studying these priority languages. That number has now risen under this strategy to 200,000 students. We also have a profound fear that the number of programs offered through schools as a result of the withdrawal of NALSAS funding will in turn be reduced. In South Australia, the number of schools offering NALSAS languages has risen to 276, some 47 per cent of all South Australian schools. Students studying these languages in South Australia are impressive as well, with a total of 54,000 students studying these priority languages. We also have the Access Asia schools and there is a danger that these will fact be diminished as a result of the withdrawal of NALSAS funding. There were nine such schools in 1994. There are 460 such schools in 2002. Also, the curriculum development directorate program currently under way with Flinders University in South Australia to assist in professional development of teachers in this sector will be undermined as a result of the loss of this funding. Also, the `Asia in country' program would cease to operate as any available funding would need to be redirected to other programs.We have a similar story in Western Australia, where again we have registered great improvements. In 1994, 202 schools offered Asian languages. That has now risen to 408 schools in 2001. Fifty-two per cent of students in 2001 were learning an Asian language. We have similar findings in Tasmania. In 1996, there were 20 schools offering priority languages. By the year 2002, there are 135 schools offering these languages.State by state the results have been impressive indeed as a result of this Keating Labor government initiative, sustained under the Howard government when Minister Kemp was the minister for education. I publicly congratulated Minister Kemp on sustaining this program in 1996 when he became the minister. I did so again publicly in 1998 when he renewed funding after its first quadrennium. It is to my profound disappointment that the current minister has not followed the precedent offered by Minister Kemp in this regard. This whole program is designed to enhance Australia's educational future. It is designed to enhance our economic future. It is designed to enhance our foreign policy future. It is also designed to enhance our national security. General Cosgrove made a statement in this direction only the other day, stating that it is `impossible to overstate the case for expanding the collective knowledge of the language and customs of our neighbours'. I would earnestly call on Minister Nelson to revise this decision, to review it and to resume this important long-term national economic program, which to date had enjoyed bipartisan support.12:10:003933McFarlane, Jann, MPMs JANN McFARLANE83CStirlingALP00—I am pleased today to be speaking on Appropriation Bill (No. 1) 2002-03. Particularly, I want to focus on the second reading amendment moved by our deputy leader, the member for Jagajaga, where we condemned the government for:(1) its failure to deliver a budget surplus in 2001-02 after a decade of growth;(2) its failure to deliver a budget surplus in 2002-03 without breaking previous commitments on defence, roads and working credits;(3) imposing the cost of a pre-election spending spree on families via higher interest rates and cuts in health and welfare spending;(4) falsely claiming that cuts to health and welfare payments are needed to fund the war against terrorism and border protection;(5) wasting $5 billion of taxpayers money by gambling in foreign currency markets through cross currency derivatives;6) wasting almost $3.5 billion by failing to manage currency risk on defence spending despite warnings from the Auditor-General;(7) wasting $31 million on maintenance services for 40 year old helicopters that are years overdue despite a $800 million downpayment;(8) its failure to recognise the GST as a Commonwealth tax and this Government as the highest taxing of all time;(9) its failure to consider the fairer options put forward by the opposition to offset the harsh measures it intends to impose on families, the sick and disabled; and(10) the failure of its Intergenerational Report to recognise that investment in education, research and development is critical to our future prosperity and our capacity to generate the revenue and wealth required to support an ageing population.In particular, I want to draw the attention of the Main Committee to the disability rally that is now happening outside the House. The themes of that rally are the need for fair wages for workers in the disability field, and the government's proposal in the budget to increase the copayment for pharmaceuticals and to change the criteria for the disability support pension. The rally is here because of the community's concerns. I also want to focus a little on the concerns of the people of Stirling, whose voice I am in this House. Their concerns are about the adverse consequences of the government's unfair proposal to increase the costs of essential medicines by almost 30 per cent for the sickest and poorest in the Australian community. Labor do not want to block Appropriation Bill (No. 1) 2002-03 but we see that, like all budgets—whether for your office, house, family or business—you have budget priorities. Labor see that we could not proceed with the measures against people on the disability support pension and the measure with the copayment if we trade off a tax cut for the top three per cent of high-income people and do not bring that into this appropriation bill or the budget.One of the benefits of working in this House is the wonderful resources you have available to you, including the Parliamentary Library. Research Paper No. 10 2001-02 produced by the Department of the Parliamentary Library refers to the budget process. The section on the overview of the budget process states:The preparation of a Budget involves a large number of participants. The Expenditure Review Committee, a Cabinet committee of senior Ministers chaired by the Prime Minister is primarily responsible for developing the Budget. However, a number of agencies—notably the Department of the Treasury (together with the Australian Taxation Office), the Department of Finance and Administration, the Department of the Prime Minister and Cabinet and line agencies—provide advice and support to the Expenditure Review Committee. Broadly, the Department of Finance and Administration coordinates the preparation of the Budget and forward estimates and is responsible for statements on expenses and non-tax revenue. Treasury is responsible for assessments of the economic and fiscal outlook and estimates of tax revenues.You would think that with so many people and so many skills and abilities put to work they would have come up with some better strategies than they did in relation to changing the criteria for people on the disability support pension and to increase the copayment. The conclusion of the research paper states: The Budget is the foremost statement of the Government's priorities, which are reflected in the resources allocated to particular activities. With outlays equivalent to almost a quarter of gross domestic product, the Budget is also a major influence over the economy generally and particular activities.Given this, it is desirable that the Government should be accountable to voters through their representatives in the Parliament, not least because voters' taxes fund spending. Recent changes to the format and content of the Budget Papers and related document are aimed at enhancing accountability. These changes include the move from cash to accrual accounting; from cash budgeting to accrual budgeting; agency reporting in terms of planned outcomes; the presentation of financial statements in accordance with two main accounting standards; the presentation of information to allow assessment of agency performance; and the reporting and other requirements of the Financial Management and Accountability Act 1997 and the Charter of Budget Honesty Act 1998.`Accountability' is the key word. That is what the community expects of us. I call on the community to raise its voice to the coalition government so that they seriously rethink the budget priorities and what is in this appropriation bill and try and get some balance and some fairness and equity back into it. The disability rally would not be happening outside if there had been fairness and equity. On top of that, the measure that is probably the most unfair and unjust is the copayment increase, which will hit our sick, poor and elderly the hardest. Labor understands the value of the copayment: we initiated it and we continued it. What we are concerned about is that, while the copayment was at $2.70 for each prescription when Labor left office in 1996, over seven years it will have increased to $4.60—an increase of 70 per cent. If a PBS increase passes in the parliament we will have seen the cost of essential medicines for pensioners, cardholders and families under financial pressure raised by 70 per cent since the Howard government came into office. I have heard the Treasurer in denial on the radio. In May he was saying:The change is $1 ... the change for pensioners is $1 ... and we're not hitting pensioners.It may only be $1 a script, but health department figures show that more than one million pensioners and concession cardholders will reach their safety net limit of 52 scripts this year, making them $52 a year worse off. If this legislation goes through the parliament, more than one million pensioners and concession cardholders on essential medications will be $52 a year worse off. There was no mention of this prior to the election. I will pass on the question that the community is posing to me: when was the Prime Minister on the television promising to raise the cost of medications by over $50 a year for over a million of Australia's pensioners? He was not. He did not talk about this because he knew that he was not being honest about his plans to target the sick and elderly. The Australian people might have come to a different conclusion when they voted at the election if they had known about the use of taxpayers' resources and funding.The coalition government are supposed to be the good economic managers of Australian politics. Let us then look at some facts. Four years ago, the Treasurer promised that the federal budget would be in surplus by $14.6 billion in 2001-02. Four years later, we discover that the budget is actually in deficit by $3 billion. Somehow the Treasurer has managed to lose $17.6 billion in that time. This does not sound like good economic management to me, and the people of Stirling who have spoken to me about it certainly do not see it as good economic management.The budget will also mean that families will pay $28.60 for each prescription—up $6.20 per script—and up to a total of $190 extra per year for their essential medicines as the general safety net goes up from $686.40 to $879.90. When Labor left office in 1996, age pensioners were fully compensated through the pension for their pharmaceutical costs. From August they will be $1.70 worse off each time they fill a script, and up to $88.40 worse off each year compared to 1996. My constituents are also telling me that, with the coming in of the GST, their household expenses are higher than they were previously, and the relative benefits of the compensation have not really compensated them for their higher household expenditure.I would like to read to you some other points. The community expects us to work in a bipartisan way. As I explain regularly to my constituents and groups, we do work in a bipartisan way up to a point; but, when it comes to a policy difference, bipartisanship does not happen. I will read something from a Labor policy paper called `Australian women and their families—women under pressure', following the 2002-03 federal budget:Labor has health as a priority. Labor is committed to Medicare and the Pharmaceutical Benefits Scheme as a basis for universal access to high quality, public funded health services for all Australians. Labor will act to strengthen the health care system to meet the future challenges associated with our ageing population and advances in technology and biomedical research. Health resources must be allocated on the basis of need so that people are not excluded from necessary services because of their financial circumstances or where they live. Quality health service delivery depends on cooperative working relationships between state and federal governments, professional bodies, community organisations, both public and private sectors and consumers. Labor will work in partnership with all parties to improve the quality of our health services.That is my appeal to you, Mr Deputy Speaker Lindsay, and to the government. We can work in a bipartisan way on this, we can look at the budget priorities, we can make decisions which will benefit most people, but we will make sure that the budget and the appropriation bills have fairness and equity. An editorial from the Age states: Prosperity saves the dayAccording to conventional political wisdom, the first budget after an election is the one in which governments are most likely to make tough cuts in services. On that measure, the Howard Government's 2002-03 budget, which the Treasurer, Peter Costello, brought down last night, is not a conventional document.That is true, as we are coming to see. An analysis by another journalist, Ross Gittins, states:On just about all the main measures announced, he's turned 180 degrees from his position last year.Again this refers to the budget. An Australian editorial states:Costello gets his priorities all wrongThis is Peter Costello's lost budget, the one that could have stamped him as the forward-looking go-getter to replace John Howard. Instead, the Budget is as much about paying for populist election policies and shirking at the hard decisions as it is about getting the Government's economic credentials and budget priorities back on track. As Mr Costello said: “World events can move dangerously and unpredictably.” His effort yesterday has proved that governments can too, even when the next bout of election fever is three years away.There is another article, by Dennis Shanahan, which states:When two masters speakThere is a great contradiction at the heart of Peter Costello and John Howard's seventh Budget. It dwells on borders and is inward looking. The tone is one of fear and the appeal is to remember the war. Yet, we are specifically asked to look to the future.The people of Stirling also read these articles. They come to me and raise their concerns. Many people, as they age, have a number of health problems; they are often on five, six or seven medications. The modelling done by the health department in relation to the increase of the copayment was done on the assumption that people are on one or two prescriptions, but people coming to me are on a number of prescriptions and they are looking at their household budget expenses blowing out. They are concerned. They implore me to bring their voice into the House and say, `There has got to be a different way of organising the budget. There has got to be a better way of organising it and making it fairer.' A media release by Catholic Health Australia states:PBS Cuts Unfair`Low income people, the elderly and the chronically ill have been hit with the equivalent of a new consumer drug tax' ...The Pharmacy Guild of Australia, in budget night media comments about increasing copayments, stated:This is an overreaction by the Government. It amounts to a major cut to the PBS. It is not merely a measure to contain its growth.The 30 per cent increase in the cost of medication is unfair. I call on the government and I call on this House to seriously look at these two items: the copayment and the changes to the disability support pension criteria. I encourage everyone to go to the rally outside the House and listen to what the workers who work with people with disabilities and community workers from other community services have to say—hear from them the stories about people's lives and how the changes will have an effect and will diminish their lives, not enhance them. I commend Appropriation Bill (No. 1) 2002-03 to the House and I hope the voices of the people will be heard.12:25:003937Adams, Dick, MPMr ADAMSBV5LyonsALP00—Each year we go through this process of commenting on the budget after it has come down. Although there are differences in philosophy, it boils down to how the taxpayer's funds are distributed. Each area—such as health, defence and education—has an allocation for new programs or cuts to old programs, yet it is the budget that controls how effective programs are in their delivery of services to the people. In Australia over the last 10 years or so there has been substantial economic growth, but where is the economic benefit to the community and how do we see it? There is concern out in the community that, if things have been so carefully managed, why are we not able to share the rewards?We pay tax during our working lives and from those taxes we expect to receive medical assistance, some education for ourselves and our children, access to employment and training, and assistance in our retirement to ensure our own quality of life is reasonable before we shuffle off this mortal coil. We also like to feel that our safety from any possible dangers, both domestically and outside our borders, is being considered. Australia, despite all its failings, is still a very good place to live if you compare it with other countries from which many of our asylum seekers are fleeing. It is also a lot more stable and peaceful than many other First World countries. But this government's budget has missed the boat in many vital areas. It has also led us into a scenario where we are overtly committed to supporting US foreign policy without question. I cannot think why this government gives away our sovereignty so easily. There is still no trade agreement, but the US steel tariffs and farm subsidy bill are harming Australian businesses and farmers. The problem with this budget is that progress appears to be measured purely in economic terms. If the Treasurer's budget comments are to be believed, the Australian economy is expected to continue its strong performance in the year ahead, with robust economic growth forecast at around 3¾ per cent for 2002-03. He says that business investment is expected to grow very strongly in 2002-03 and will be a key driver of overall economic growth. Then he adds that household consumption is also expected to remain strong.I agree with those people who suggest that the figures illustrating the overall economic growth mask the lack of genuine progress on a number of fronts. More attention needs to be paid to the quality rather than the quantity of growth. The 1996 United Nations Human Development Report identified five damaging kinds of growth: that which does not translate into jobs, that which is not matched by the spread of democracy, that which snuffs out our cultural identity, that which despoils the environment and squanders resources for future generations, and that where most of the benefits are claimed by the rich. The report calls these categories, respectively: jobless, voiceless, rootless, futureless and ruthless growth.A group called Australian Collaboration has recently been established to consider the problems and pitfalls of making public policy. It has put together a report which draws attention to key social, cultural and environmental issues facing Australia so that public policy is directed to resolving them while continuing to foster economic wellbeing and vitality. The group consists of a wide range of peak non-government organisations that have struggled individually to have their message heard at budget and policy development times but that have been hampered by having to respond to very narrow parameters. Now, by getting together and putting a holistic approach to the policy developers, they may be able to address some of the very real structural problems that exist in Australia without necessarily changing the economic picture.I do not think this government is receptive to consideration of anything other than the economic bottom line. It does not believe that there should be government intervention where there is a problem in the structure of the economy. Those in regional areas should be able to survive, without help, as well as those in cities. The marketplace is all. We have evidence in this budget that shows the government has little sympathy for the unemployed, the elderly, the disadvantaged, people with disabilities and low-income workers. It has little interest in those who have lost their jobs because of bad management practices. It seems to be about who you know and not about what security net is in place to provide the opportunity for redundancy payouts.A fair day's work for a fair day's pay does not seem to register in the Liberal philosophy. They seem to be more interested in casualising work, taking away the few rights that workers have gleaned over many years and seeking ways of getting rid of people from the workplace without redress to a fair hearing. The budget shows the emphasis is on the economic bottom line and a push for a surplus, not on the wellbeing of the people that this parliament serves. As David Yencken and Libby Porter from Australian Collaboration note:If growth does not provide properly for the well-being of all Australians, if it does not contribute to the solution of existing social, cultural and environmental problems, if it increases disadvantage, produces new inequities and further despoils the environment, then it not only causes pain and hardship to those affected but also undermines the fabric of the society and the future potential of the economy.Therefore, my criticism of this budget goes deeper than the individual line items in the budget. It is the whole process of coming to a reason for changing what exists at the moment. For example, I can criticise the program that seeks to move the emphasis of funding from one group to another, purportedly saving money by taking people off the dependency list with the excuse that they are more likely to find work if they are deemed fitter, without really considering their needs and abilities. The disability support pension makes a good example. There is no real assistance offered to the many disability support services in my state of Tasmania, many of whom are already experiencing tough times keeping their services going.This pension is a safety net and changes are going to have dire consequences. They will have a savage impact on some of the most vulnerable Australians—200,000 Australians will have their pensions reduced by $52 a fortnight. Australians with significant disabilities working in business services, otherwise known as sheltered workshops, will be forced to go down to Centrelink and line up for Newstart. That is how savage these proposals are.The pharmaceutical benefits changes are another cynical exercise. This is Peter Costello's answer to the Intergenerational Report, which shows the proportion of older people in the community is increasing. He shed crocodile tears that the funds would not go around, yet we heard in the parliamentary debate that the government's budget measure is to increase the cost of essential medicines by nearly 30 per cent. At the same time we see the government confirming a $12 million advertising campaign telling pensioners and struggling families that increasing the cost of their essential medicines is good for them. It sounds like a strange use of the funds that are allocated to the PBS.The PBS system desperately needs overhauling, but not the way this government is doing it—and I will be talking about that at another time, as I have a whole swag of information to put forward that would have to be considered in the reform process. Here we are in the 21st century with a government still with its feet in the fifties and the budget reflects this: just another cynical attempt to justify some quite unjustifiable spending of our taxpayers' dollars. I am aware that there is an endemic problem in parliamentary democracies that governments have a short-term focus largely concentrated on the electoral cycle and that direction is run on the mood of the electorate depicted in the media and in opinion polls. I am also aware that politics in the democratic systems is adversarial and that we have to differentiate ourselves as much as possible from each other and denigrate the policies, programs and actions of our rivals. It is all part of the political game. But when we are presented with such a cynical exercise as we have been given this time, I am wondering what on earth I am doing fiddling at the edges of someone else's policy and listening to the non-answers to fairly specific questions at question time.We must do more. I do not believe I was put into the parliament to listen to such garbage. We in opposition have to do something concrete. I believe we have to be more inclusive in developing our country's direction. We need to heal the real hurts and actually challenge the economic system as it exists today, because it is not working for the majority of Australians. I believe our leader is embarking on a direction that will bring fundamental change to the way we are doing things, and I want to still be here when he achieves those goals. I cannot support this budget direction or its unrepresentative way of allocating funds to programs and I will be doing my utmost to have the system changed.12:35:003939Griffin, Alan, MPMr GRIFFINVU5BruceALP00—I rise today to speak in the debate on Appropriation Bill (No. 1) 2002-03 to reflect on the federal budget and the actions and strategies being employed by this government with respect to its wider economic activity and on some of the key measures within that budget that reflect the quite mean and heartless way the Howard government is approaching this particular budget. I think we have to look first at the context that we have here. We have a government with a Prime Minister clearly in the midst of his lap of honour, visiting a range of locations overseas and coming towards the twilight days of his reign. When you look at the budget, the concern is that we may be talking more about the twilight zone with respect to the needs of the disadvantaged in our community. This government are seeking to use the disadvantaged in our community to pay for, in effect, a range of initiatives that they had undertaken in those halcyon days leading up to the last election, when they spent away the projected surplus in order to try to get themselves another term—and another term they got, although I would say that other term was got for a whole range of reasons. But certainly they have now been left with a mess. It is a mess that the Prime Minister and his cabinet have created and it is a mess that the Treasurer allowed to be created in the lead-up to the last election.When we then go on to the question of where we are now, we have had two particular initiatives proposed by this government—`initiatives' is probably a pretty strange word to use to describe them—to deal with part of their budget problem. There is a change to the Pharmaceutical Benefits Scheme with respect to the copayments required by members of the community and there are also changes to the disability support pension eligibility criteria. Both of these changes are regressive in the extreme; both of these changes have a far greater impact on disadvantaged people in our community than on anyone else. They really point to the fact that this government's underlying strategy very much is, `If you've got a problem, it's your fault; if you are facing a situation of disadvantage, it's your fault, and, frankly, we're going to make you pay for it,' and that is exactly what they are doing.When we look at the issues around the Pharmaceutical Benefits Scheme, for example, some of the most interesting aspects are the comments made by the Treasurer in recent days. Essentially, he talked about the fact that the scheme itself is unsustainable in the medium to long term, that the circumstances with new and innovative drugs coming onto the market are such that the cost is going to spiral out of control, that we will have a funding crisis which will make it impossible to fund the system properly and that therefore we have to get stuck straight into the real benefits of what is available to the community by making the community pay more for the particular medicines involved. What we have seen happen here is an arbitrary budget cut. This whole system has been underpinned—historically and largely in a bipartisan fashion—by the operation of the Pharmaceutical Benefits Advisory Committee. The whole basis of that relates to things such as expert advice, experts considering the question of the inefficacy of particular medications and looking at the scientific evidence in order to ensure that proper decisions are being made and, in that way, so leading to proper decisions based on health outcomes for the best needs and interests of the community. Yet what we have got now is a situation where an arbitrary budget cut is being implemented. The government says, `We are going to drop all that consideration of scientific evidence. We are going to drop all that evidence of health outcomes. We are just going to cut it and see if that creates an impact, and we are going to do it so that the disadvantaged in our community are forced to pay more and certainly forced to pay more sooner—in the context of a year—in order to ensure that they get the medicines they need.' There has been some very worrying information out there in the community about what the impact of this is likely to be. Surveys have been done publicly by respected polling companies on behalf of at least one pharmaceutical company that I am aware of which have provided information that suggests that for something like 80 per cent of people these changes will not impact on what they do in selecting their medications. They also show clearly that a majority of people oppose these particular changes. However, the interesting figure there is the 20 per cent. Some 20 per cent of people suggested that they would now make an economic decision concerning the medicines they get to deal with conditions that they have. Some one in five people are actually actively considering whether or not they in fact get the medications that they need. That is a very worrying statistic. It is a worrying statistic for now and for the future because, when you look at the issue of health outcomes and the role of pharmaceuticals in providing health outcomes, it is important for the parliament to understand that pharmaceuticals make savings on overall health care costs into the future. Over time, they will lead to reduced costs in terms of hospitalisation and other activities. What you can show—and some studies have shown this—is that every $1 spent in the pharmaceutical area will in fact lead to savings of as much as $3 and $4 elsewhere in the health system.Yes, health overall is increasing in cost. That is the nature of the development and improvement of a civilised society. The fact is that, as a First World country, we are in a situation where we will be spending more on health, because that is the way it goes when you are in an advanced nation, and we are an advanced nation. But what we see with that process of the population ageing are greater health costs that have to be dealt with. It is fair enough to say, `Let's have a debate,' and, in fact, there surely is a need for a debate about some of the directions we take in these areas. But what we have seen here is not a debate; what we have seen here is a decision. It is an arbitrary decision—quite a ruthless decision—and in a situation where the conventional wisdom about how you consider these points with respect to what is good health policy has just been thrown out the window. There has been significant criticism of this from a range of different organisations. This is an example from Catholic Health Australia:The government's planned Budget cuts to the Pharmaceutical Benefits Scheme (PBS) were crude and unworkable, Australia's largest grouping of non-government health providers said today.Francis Sullivan, of Catholic Health Australia, also said:“The savings, we believe, are over-estimated and the benefits to the community, as far as health is concerned, are not finely tuned.”A community debate was better than ramming something through the parliament ...“If there is a need for fees to be increased on drugs, then let's have a series of options put out there by the government,” ...But that is not what we have had. When you go beyond that to the issues around the disability support pension, there are other concerns. I would just like to quote from a release from the Down Syndrome Association of New South Wales, which I think again highlights just how arbitrary and unfair this particular initiative is.The Down Syndrome Association of NSW strongly opposes the proposal to move people with disabilities, including those with intellectual disabilities, currently receiving DSP, who are assessed as able to work more than 15 hours a week at award wages, to the Newstart Allowance. We understand from the Office of Disability, Department of Family and Community Services, that the new criteria will also apply to new applicants for the Disability Support Pension.Down syndrome is a manifest condition, causing intellectual disability, which is a stable and permanent condition, categorized as such by Centrelink. There is no cure. Medical treatment cannot remove the condition.Many of our members are working part-time, for more than 15 hours a week, and are in receipt of at least part DSP and associated benefits. The proposed changes would have a major negative impact on them and those who are about to embark on training and entry into employment. The proposed changes will discourage people from extending their hours of work to more than 15 hours per week and will significantly reduce the income of those working longer hours who are transferred to the New Start provisions. They will also lose a range of other benefits such as travel concessions, rental assistance and health benefits. People with Down syndrome have a range of conditions unique to the syndrome. Health benefits are therefore critical to quality of life. Travel benefits assist the mobility of people who will never drive and will always be low income earners.It is unlikely that people with Down syndrome who have an intellectual disability will be able to meet the mutual obligations required by the tests for the Newstart Allowance and may end up receiving no benefits at all.There is a range of points there which are quite relevant and show that this government have truly been mean and tricky with respect to this budget, aiming their changes and cuts at the most disadvantaged in society and putting them into a set of circumstances which is manifestly unfair to the most disadvantaged in our community. The government have done it in order to pay off a Bankcard bill that they created in the lead-up to the last election, in a campaign which was designed to hoodwink the Australian community about not only the economic circumstances we face but the nature of the economy we will have into the future. They ought to be condemned for it, and those particular initiatives ought not be supported. I commend those in the Senate who are seeking to ensure that they are not accepted, and I urge the parliament to support that position. 12:46:003942Albanese, Anthony, MPMr ALBANESER36GrayndlerALP00—I rise to speak on Appropriation Bill (No. 1) 2002-03. This budget was a major disappointment for all Australians. The result from the Newspoll survey certainly indicates that Australian voters thought it was one of the worst budgets ever. The budget contained no vision of what Australia could be. It was, in the words of my colleague the shadow Treasurer, Bob McMullan, a `pedestrian, unimaginative budget' which sought to exploit people's fears instead of building on their hopes. Maybe we could have forgiven the lack of vision if it wasn't for the inexplicable attack it made on the most vulnerable members of our community: the poor, the aged and the disabled. Budgets are about choices and government priorities. This year, Howard and Costello opted to take $52 a fortnight away from 200,000 disabled pensioners, while giving a tax cut to the wealthiest three per cent. They proposed to do this by cutting the superannuation surcharge, a tax cut which will cost the government $370 million over three years. Labor will not support these unfair measures. These measures are unjust; we do not believe that Australians want an unjust society.Despite the obvious critical shortage of nursing home beds and community care packages, the government in this budget did not see fit to announce one new nursing home bed. At a time when they have produced the Intergenerational Report speaking about Australia's ageing population, one would have thought that we would have seen increased resources. However, the budget papers show that the government actually saved $152.1 million last year and are planning to save $174 million next year from the aged care budget—a total of $326 million. The government have removed this money from aged care and returned it to general revenue because—and I quote from Budget Paper No. 1—they say that there has been:... a fall in estimated demand for residential aged care services.How does that sit with the rhetoric of the Intergenerational Report? We all know that there has been no fall in demand for residential aged care services. We have quite the opposite problem: there are currently hundreds, if not thousands, of frail older Australians waiting in hospital beds. Currently, 300 people in the minister's own state of Victoria are waiting for a bed to become available in a nursing home. I understand that the government have dismissed queries about this supposed drop in demand by saying that savings have been made because there has been less demand for low care residential services as people are choosing to stay at home and take up community aged care packages. If that is the case, why isn't the money being redirected to those much needed packages? Why has the minister allowed $326 million of aged care funds to be lost to general revenue? Minister Andrews has failed in this budget to address these issues. The Australian Labor Party think that aged care needs more public investment, not less.There is no way that the government can justify ripping $326 million out of aged care—unless, of course, they are more keen to look after the very rich. The government's priorities show that they found $4.5 billion to gamble on the foreign exchange market, hundreds of millions of dollars for the so-called Pacific solution, billions of dollars for defence and $2.5 billion to subsidise the private health insurance industry, but only $72 million to address the growing pressures on nursing homes and community organisations who provide support and care to frail older Australians. While our spy services received a major funding boost, community organisations are left struggling to provide the support services that would enable older Australians to remain in their own homes longer.There was a small amount of relative good news in the budget. The government did make some progress towards addressing the concerns that the sector and the ALP have raised about the adequacy of the residential aged care subsidy by providing additional funds and making a commitment to review the existing funding formula. So that is relatively good news—the government is allocating an additional $211 million over four years to increase the residential aged care subsidy per resident, specifically to deal with the wage gap. However, this translates into less than an extra $1 per resident per day—a one per cent increase. So, for an average 48-bed nursing home, this means an extra $48 per day to increase wages across all shifts.It is only since the changes were brought in by this government in 1997 that we have seen the massive gap in wages between staff who work in public hospitals and those who work in aged care residential facilities. With the national wage gap between aged care nurses and their public sector counterparts being $84.48 per week, I do not imagine that this additional funding will be enough to address the wage disparity and stem the flow of experienced nurses out of aged care, let alone attract new nurses into the sector.The budget did not address any of the other cost pressures building on nursing home operators, such as public liability insurance, workers compensation premiums, excessive documentation attached to the current resident classification scale, the validation process or capital costs associated with the accreditation regime. These issues need to be addressed if we are to place the aged care system on a realistic funding basis. It was also good to see that the government has finally committed to a pricing review of residential aged care subsidies. We support the review, but we are concerned that it will not be completed until the end of 2003. We are hopeful that this review will quantify the true cost of providing quality aged care. I would also like to address the impact of the budget on rural and regional Australia. Of immediate concern to Labor is the government's promise during the last election campaign that it would provide an additional $100 million in capital funding to rural, regional and urban fringe small, high-care nursing homes to assist them to upgrade or build anew. However, the budget papers reveal that the government is only providing $79 million. That is $21 million less than what was promised just months ago. To add further insult to rural and regional communities, they will not see much of this new money for another three or four years—again, this is a breach of the government's election promise that the $100 million would be spread evenly over the next four years. Nursing home operators desperately need this funding in order to upgrade and maintain their facilities so that their residents can remain in the communities where they have spent their lives. Ageing Community Services Australia estimates that a minimum of $450 million is required if significant progress is to be made toward building sufficient services and upgrading existing ones to meet fire, safety and other building certification requirements by the year 2008.Labor was also extremely disappointed to see that the budget contains no new initiatives or funding to move young people out of nursing homes and into more appropriate and supportive accommodation. We are committed to addressing this issue and we will continue our efforts to convince the government that this is an issue that it should care about and take action on. I was very proud to represent the Australian Labor Party at the national summit on this issue which was held in Melbourne, where I heard the personal stories of the families, and indeed the young people themselves. They are being forced to live in this totally inappropriate form of accommodation simply because there are no other options available. I call upon the government to somehow find its heart, to find a bit of compassion, and address this issue.I also want to talk about work force issues. Sadly, the budget did not address the work force issues that are currently causing great distress to operators and their staff. Two hundred and fifty nursing scholarships and the $21.2 million for training are not going to greatly enhance the sector's capacity to recruit and retrain qualified nursing staff. Also of concern to nursing home operators was the announcement that the government intends to recover $46.3 million by clamping down on those residents incorrectly claiming concessional resident supplements. I am sure a fair bit of time has already been spent on discussing just how operators will repay the supplement to the government and then attempt to recover the money from the resident. As well as being a tax collector they will also be the government's debt collector.The greatest concern to emerge from last month's budget was the much vaunted Intergenerational Report. The report had been cast as the centrepiece of the budget, supposedly showing for the first time the impact of demographic change on the government's finances over a 40-year horizon. On a conceptual level, the idea of looking forward and attempting to anticipate future budgetary pressures under a variety of scenarios is undoubtedly a worthy idea and is something that the ALP supports. Unfortunately, the IGR presented in the budget papers has been used as a cynical political exercise by a Treasurer more intent on generational change in the Liberal leadership than on meeting the challenges of serious economic management over future decades. There is nothing new in it—no startling revelations that other research has not already revealed. It is, instead, little more than a repeat of existing studies at a slightly more disaggregated level.If the government were serious about long-term fiscal sustainability, they would not have embarked on a massive vote buying exercise prior to last year's election that has systematically eroded that very sustainability. The IGR is flawed as a planning tool because it takes far too narrow a perspective. It fails to adequately address environmental, regional and population policy or infrastructure related issues. The IGR paints a bleak outlook for Australia, with a slowing in the growth of living standards and higher budget deficits. Yet the IGR offers no solution to these problems. The government's predictable response has been to take the low road and cut living standards now to pay for costs that may or may not eventuate in the future.The Treasurer called the IGR `visionary'. However, there is nothing visionary about cutting the hard-won entitlements of current and future generations of older Australians. I like to think that Australia's destiny is in our own hands. It is up to us to shape our future and determine where we want to be in 40 years rather than passively accepting one bleak scenario as the preordained outcome, which must be feared and resisted. Sadly, this government's agenda is to withdraw from significant areas of public policy where Labor believes the Commonwealth should retain a central role.In the budget the Commonwealth made cuts in payments to the states for the environment, disability support, housing and roads. The likelihood is that the next targets will be schools, aged care services, hospitals and poverty alleviation—all key areas of Commonwealth responsibility. Overall, Labor believes this report adds little to the debate surrounding the economic and social implications of an ageing population. We believe it is a stunt to divert community attention from the immediate crisis in the aged care sector and justify further crude cuts to health and aged care services in the future.Labor believes that a vision is required for the demographic change that we are about to experience and that the vision should acknowledge that ageing policy, like the ageing process itself, is a continuum. Cuts to welfare and health services today will create further demand for government expenditure in the future. This is a very narrow budget based upon fear, whether of international events or even fear about ourselves and the ageing of our population. What we actually need, if we are about building a cohesive society, is hope, a positive vision and positive action to ensure that we are indeed in a position to meet the economic and social challenges of the future. 13:00:003945Slipper, Peter, MPMr SLIPPER0V5FisherLPParliamentary Secretary to the Minister for Finance and Administration10—by leave—On behalf of the government, I am particularly pleased to bring the budget debate to a close. This is, of course, a package of bills that is always enthusiastically debated and when I look at the list of people who spoke I see some 90 speakers participated on this occasion. This indicates the importance that the parliament continues to place on debate on the national economy and on its management by the government. It goes without saying, but I would like to thank all honourable members who participated in the debate. Some spoke on issues other than the budget, but that certainly is in keeping with the provisions of the standing orders.I am quite sure that you will understand and forgive me when you note that I am not able to canvass all matters spoken about by all members during this very long and protracted debate. I have, however, been induced to talk on some of the contributions, particularly those of the Australian Labor Party and some of the more outrageous remarks made by some honourable members opposite. These three appropriation bills, together with other legislation introduced in these budget sittings, embody the objectives of the government for the 2002-03 budget. They include funding the deployment of Australian troops in the war against terrorism; implementing measures to defend our citizens and our national security assets by upgrading domestic security and securing Australia's borders; responding to the issues raised in the Intergenerational Report, including maintaining a world-class health and aged care system into the future; providing incentives to encourage further contributions to superannuation; assisting job seekers by investing in education and the apprenticeship system; and keeping conditions in place to continue low levels of unemployment, low inflation and low interest rates.We are expecting to bring in a cash surplus of $2.1 billion in 2002-03. With further budget surpluses, the government will continue to reduce the enormous debt that we inherited over six years ago, thereby strengthening the legacy that we leave our children. Since the Howard government came to office, we have cut that debt by two-thirds. In 2002-03, we are expecting the Commonwealth's net debt to be $34.5 billion and to be completely eliminated by 2005-06. Objectively, that is an outstanding achievement for the economy. There can be no doubt that our solid budget position over the last few years has contributed to the strength of the economy, which has in turn contributed to the budget bottom line, creating a virtual cycle. Economic growth is expected to remain strong during 2002-03, at 3.75 per cent. The International Monetary Fund in its most recent World Economic Outlook reported that Australia was expected to be the second fastest growing advanced economy. Employment growth is forecast to strengthen, with the unemployment rate declining to around six per cent by mid-2003. You would be aware, Madam Deputy Speaker, that we have created 900,000 new jobs since we were elected to office and soon that will be one million jobs—another outstanding achievement by the Howard government. The forecasts I mentioned a moment ago indicate that the government's economic reforms have contributed significantly to a flexible and resilient economy. The government's fiscal policy has helped fireproof Australia from economic slowdowns which have affected so many other developed countries.With respect to Telstra, the honourable member for New England in his speech expressed concerns about the issue of the sale of Telstra. It is an unfortunate fact of life that some Australians continue to believe their interests as consumers are better served by the government owning the particular service provider. That is a belief without foundation and is often in direct contradiction to that same consumer interest as taxpayers. Consumer interest is best preserved by the operation of a competitive market within a regulatory framework which is as light-handed as possible. In relation to telecommunications, it is clearly not necessary for the government to half own the biggest service provider to ensure good outcomes for customers. The government has all of the constitutional and legislative authority necessary to optimise the interests of consumers.Since the 2001-02 Mid-Year Economic and Fiscal Outlook, the government has committed additional funds totalling $2.9 billion over five years to combat terrorism, bolster domestic security and increase protection of Australia's borders. This includes $1,084 million for increased border protection, $1,308 million for upgrading domestic security and $524 million for the war against terrorism. We are allocating an additional $1.3 billion over five years to enhance security within Australia. This includes an upgrade to airport security and additional funding to the Australian Federal Police, the Australian Protective Service and Australian intelligence services. The measures to be funded will enable us to be ready to respond to major security incidents. The measures that the government has implemented to secure Australia's borders are already producing results, with a dramatic reduction in unauthorised boat arrivals—in fact, there have been none since December last year. We are now allocating $219 million for the construction of a purpose-built reception and detention centre on Christmas Island for illegals. Fiscal consolidation has enabled the government to reduce its debt-servicing obligations by billions of dollars per year, enabling this money to be redirected towards important community services. For example, the government has given an enormous level of assistance to new home buyers through its First Home Owners Scheme. The grant continues at $7,000, helping thousands of Australians to buy a house for the first time. Also the government will be assisting with the introduction of the baby bonus. Around 245,000 families are expected to benefit from this initiative in the first year, with 600,000 eventually benefiting. A number of measures are contained in this budget to improve health care for Australians, especially for those living in regional Australia and in the outer suburbs of our major cities. An important example is the $72.7 million program to fund up to six new facilities to be built outside the capital cities to improve patient access to radiation oncology services. During the debate a number of members of the opposition criticised the shortage of doctors in regional and rural Australia. However, they do not fully acknowledge the range of measures that the government has taken. The government is continuing its support for rural clinical schools and efforts to ensure that a quarter of medical students undertake 50 per cent of their training in a rural area by 2004. The budget includes increased funding of $4 billion in 2002-03 for the medical specialist outreach program to fund projects or services to support specialists already in rural areas and those undertaking outreach into rural areas. The government will also be encouraging an extra 150 doctors to work in outer metropolitan areas of the six state capitals. It will do this by offering higher Medicare rebates to other medical practitioners and by allowing specialist trainees access to Medicare provider numbers in outer metropolitan areas. This is a particularly important initiative.Many opposition speakers have criticised the government's proposed changes to the Pharmaceutical Benefits Scheme. The government is committed to securing the future of the Pharmaceutical Benefits Scheme—a scheme which is a key part of Medicare and which has provided subsidised access to a range of medicines for over 50 years. Medical technology is improving all the time. This provides us with the capacity to treat more conditions than ever before and to treat them more effectively. This new technology, alas, comes at a price. Nowhere is this more evident than with the Pharmaceutical Benefits Scheme, the fastest growing area of health spending. The cost of the scheme has nearly quadrupled since 1991 and has grown by $1.5 billion over the past two years.The Intergenerational Report—the first by any government ever—which looks into what Australia will look like in 40 years time, projects that the scheme will be the most significant area of pressure in the health budget and, in 40 years time, could grow to around $60 billion in today's terms. This projected growth needs to be addressed if we hope to continue to provide Australians with affordable access to medicines. Action is necessary now if governments are to have affordable access to the new generation of potentially lifesaving medicines currently being developed, some of which cost tens of thousands of dollars per person per year. The measures that were announced in the budget are designed to put the Pharmaceutical Benefits Scheme on a more sustainable footing so it can continue to deliver access to medicines at affordable prices over the longer term. The measures will also ensure that consumers, industry, doctors and pharmacists all contribute to containing the rate of increase in the scheme. The honourable member for Fremantle made a number of assertions about government funding for ATSIC. The $470 million savings measure implemented in 1996-97 has been more than offset by various measures since then. Total Indigenous specific funding will reach a record of $2.5 billion in 2002-03. Also, revenue from government to ATSIC increases over the forward estimates by $160 million for anticipated increases in activity. Members opposite, including the honourable member for Hasluck, have also made ill-informed criticisms of the government's proposed changes to the disability support pension arrangements. I can assure honourable members that people with disabilities who have a limited ability to work will continue to be protected. The government have also indicated that they are willing to look at options to smooth the transition to the new arrangements. We will assist them to work towards the transition to work with a package which includes over 73,000 additional places in services, and programs covering disability employment services, rehabilitation and education and training. We will provide around $258 million over three years for this transition. We will make disability service pension claimants who are affected by the new arrangements a priority group for existing rehabilitation and disability employment assistance places. The level and measure of services will be carefully monitored after implementation to ensure that the balance of services is right and that people are getting access to the services they need. The member for Shortland criticised, as she saw it, a lack of attention to aged care in the budget, and I think the member who spoke before also referred to this particular matter. The member for Shortland was referring specifically to her electorate. I am pleased to assure the honourable member that this year we have announced new measures to provide better care for older Australians, totalling $654 million over four years. This includes increased subsidies for residential aged care homes and funding for additional support for carers. This budget includes a program to upgrade or replace small high-care homes in rural, remote and urban fringe areas. To address the need for more aged care nurses, the government is providing funding for 250 aged care nursing scholarships at rural and regional university campuses. The increased subsidies for residential aged care homes will also allow better pay rates to be offered to aged care nurses. Continuing our recognition of the contribution made by veterans, the government is extending eligibility for the war veterans gold card as well as introducing indexation to the ceiling rate of the income support for war widows. A number of opposition members, including the honourable member for Jagajaga, criticised the budget for what they perceived to be a lack of investment in education. Again, I am pleased to reassure the honourable members that in this budget the government has allocated a record amount of $6.6 billion to schools in 2002-03. New measures for the Education, Science and Training portfolio total $182 million over four years. The government will also provide $97.5 billion over three years to continue the quality teacher program.The honourable member for Throsby criticised what she saw as a $64 million cut in funding for the third employment services contract. In fact, the new arrangements represent improvements to the already effective current practices with more tailored assistance for job seekers. Amongst a number of improvements is the introduction of the job seeker account which can be drawn on to fund training, transport and other services which will assist a person to gain employment. The expected savings will be the result of more effective services and other improvements.The honourable member for Prospect, the Chief Opposition Whip, criticised the General Employee Entitlements and Redundancy Scheme for not protecting 100 per cent of employee entitlements. In fact, the government has allocated $85 million for the scheme in 2002-03. While the scheme does not provide 100 per cent protection, it does cover all unpaid wages, accrued annual leave, accrued long service leave and pay in lieu of notice based on a salary cap of $75,200 per annum. Redundancy pay up to the community standard of eight weeks is also paid.This budget provides incentives to encourage individuals to improve their retirement incomes, including from 1 July this year a matching superannuation co-contribution of up to $1,000 per year for qualifying low-income earners who make personal undeducted superannuation contributions. Also, self-employed people will be able to claim a full tax deduction of up to $5,000, up from the current deduction of $3,000.The member for Fraser criticised the presentation of information in the budget papers. The facts are these: the budget papers and portfolio budget statements report both accrual and cash information. Both the underlying cash and fiscal balances are clearly identified, as they have been since accruals were introduced in 1999-2000. Under the new outcomes and outputs reporting framework, there is now considerable detail on what public moneys are contributing towards in the community as well as the performance benchmarks used to assess this contribution.I mentioned earlier that a wide-ranging debate is common when parliament considers appropriation legislation. Another regrettable but common occurrence is a proposal by the opposition to amend the second reading motion and in this case the amendment was moved by the honourable member for Jagajaga. It will not be a matter of surprise to the honourable member that the government is not under any circumstances prepared to agree to the amendment. I do not wish to refer to the individual components of the amendment, but I want to state that this budget continues the government's record of quality financial and economic management. The budget demonstrates the government's commitment to maintaining a resilient economy and to positioning Australia so that it is able to respond to unforseen events, as well preparing for issues that will face us into the future by enhancing our social and economic infrastructure to a better standard of living and better future economic prospects for all Australians.In conclusion, Appropriation Bill (No. 1) 2002-03, which was introduced by the Treasurer, together with Appropriation Bill (No. 2) 2002-03 and the Appropriation (Parliamentary Departments) Bill (No. 1) 2002-03, both of which I introduced on budget night, are part of a fiscally responsible budget that is designed to meet the continuing challenges of today and to project forward so as to address the challenges of the future while continuing to reduce debt. This is a budget that the government is very proud of. The budget is clear in focus and certain in its objectives. We have delivered the defence funding needed to fight the war on terror and we have delivered the funding to keep our borders strong. The budget builds on the government's reforms over the last seven years to ensure a strong Australian economy and a strong nation for future generations. I thank honourable members for their contributions and I commend the bills to the House.10000Corcoran, Ann (The DEPUTY SPEAKER)The DEPUTY SPEAKER (Ms Corcoran)—The original question was that this bill be now read a second time. To this the honourable member for Jajajaga has moved as an amendment that all words after `That' be omitted with a view to substituting other words. The question now is that the words proposed to be omitted stand part of the question. Question agreed to.Original question agreed to.Bill read a second time.394913:20:003949Slipper, Peter, MPMr SLIPPER0V5FisherLPParliamentary Secretary to the Minister for Finance and Administration10—I suggest that it might suit the convenience of the Main Committee to consider the items of proposed expenditure in the order and groupings shown in the schedule which has been circulated to honourable members. The consideration of the items in groups of departments has met the convenience of the House and the Main Committee in past years. I take the opportunity also to indicate to the Main Committee that the proposed order for consideration of departments' estimates has been discussed with the opposition and the Independent members, and there has been no objection to what is proposed.The schedule read as follows—Department of Agriculture, Fisheries and ForestryDepartment of the Environment and HeritageDepartment of Health and AgeingDepartment of Employment and Workplace RelationsDepartment of Foreign Affairs and TradeDepartment of Industry, Tourism and ResourcesAttorney-General's DepartmentDepartment of Education, Science and TrainingDepartment of Transport and Regional ServicesDepartment of Immigration and Multicultural and Indigenous AffairsDepartment of Family and Community Services Department of Veterans' AffairsDepartment of DefencetogetherDepartment of Communications, Information Technology and the Arts Department of Finance and AdministrationDepartment of the Prime Minister and CabinetDepartment of the Treasurytogether10000Corcoran, Ann (The DEPUTY SPEAKER)The DEPUTY SPEAKER (Ms Corcoran)—Is it the wish of the Main Committee to consider the items of proposed expenditure in the order suggested by the minister? There being no objection, I will allow that course to be followed.Sitting suspended from 1.21 p.m. to 4.00 p.m.Department of Agriculture, Fisheries and ForestryProposed expenditure, $450,388,000.16:00:003950Sidebottom, Sid, MPMr SIDEBOTTOM849BraddonALP00—There are some issues relating to primary industries—fisheries, forestry and agriculture in particular—that the government, and certainly the Minister for Agriculture, Fisheries and Forestry, have little direct control over. I refer to external factors and, in particular, the decision in the United States in relation to the US farm bill. Apart from the rhetoric that is associated with the minister trying to put the best light on it, I can appreciate the frustrations that must accompany this, but there are factors which we can have control over—factors about which this minister unfortunately has not shown due diligence in terms of being tardy in response and also rejecting the advice of his own advisory council and the industry. I am referring to the whole issue of the beef quota into the US. The legacy of that involvement is a litany of incompetence of the first order. This minister has not been brought to task on that as yet, but I can assure you that will continue.HX4Katter, Bob, MPMr Katter—The meat producers will fix that up at the next election.849Sidebottom, Sid, MPMr SIDEBOTTOM—Indeed, and no doubt the member for Kennedy and others will be mentioning that. We have a Senate inquiry taking place at the moment on the administration of the United States beef quota which is hearing submissions relating to this tardy exercise on the part of the minister. I took time to look at the submission by the Australian Meat Council to the Red Meat Advisory Council on US beef quota control arrangements on 5 February 2002. They gave a considered background to this issue of quotas in the United States—along with a chronology of events from quite early in the piece up to the present situation. One of the interesting things that came out of that submission—which is supported easily by the greater part of the industry to this day and has been reinforced in the submissions to the Senate inquiry—was that it was absolutely paramount that we have some form of consensus on the approach not only to US beef quotas but also to the beef industry and associated industries in terms of maintaining a sustainable industry, production into the future and looking at the question of diversification. So it is absolutely crucial that we get some form of consensus. Unfortunately, the minister has not been able to act on that consensus for reasons best understood by the minister himself. The industry cannot understand exactly what the minister is up to. I do not want to have to take the cynical view that it is to support, for whatever reasons, the largest producers in the industry at the expense of smaller producers, and certainly at the expense of diversification in the industry. Today there is a press release representing industry leaders, producer groups, beef processors and exporters who have unanimously condemned the comments made by the Minister for Agriculture, Fisheries and Forestry, Warren Truss, in his press release issued on Monday. They totally reject them. They say statements by the minister that his US beef quotas scheme will limit job losses are ill-founded. Most of the submissions made to the Senate inquiry make it quite clear that not only will this plan—if you can call it a plan—of the minister's, if implemented, lead to job losses; it will also lead to a reduction in the price of beef. In other words, prices will be seriously affected by it as well. It will affect the whole of the industry. The group are also adamant that value added exporters will be shut out of the US market in favour of commodity grinding beef and that the industry consensus has been ignored. They also questioned the minister's claim that the preferred industry position would have delivered windfall quota gains to a select few. There is a belief in the industry that the minister is not taking the issue seriously. I hope that is not the case, but the fact that the industry believes this means that there is a great deal of disquiet related to this. (Time expired)16:05:003951Katter, Bob, MPMr KATTERHX4KennedyIND00—It is quite incredible that in this budget the money allocated for agriculture has been reduced, and it is most certainly a reflection upon the minister, who obviously has no clout in cabinet. At the time of making this address to the Main Committee, the tobacco industry looks like it has completely vanished in Queensland. The forestry industry in North Queensland has all but vanished. The fishing industry has all but gone. The egg-farming industry has all but gone. Dairying has been seriously damaged. The grape industry has all but gone. The sugar industry has a huge question mark over it. As a result of the tardiness of the minister in acting in the matter, which was referred to very well by the previous speaker, the minister has created a great deal of uncertainty in the cattle industry.It was a government decision that destroyed the tobacco industry. It was a government decision that destroyed the forestry industry. It was a government decision that destroyed the fishing industry. It was a government decision that destroyed the egg-farming industry. Dairying has been damaged by a government decision, and the grape industry has been destroyed by a government decision. The cattle industry is in trouble now, and I suppose about 30 per cent of the problem specifically must be sheeted home to the minister because of his tardiness in taking any action or showing any leadership whatsoever in the industry. I think that the ultimate quota decision has probably been a good one—that is a very difficult call to make—but, if the decision had been made back in February or March, all of this uncertainty would have been over in March or April and we would not have it accumulating now, at the most precarious time, as the American beef quota starts to run out over the next two or three months.The talk about free trade rescuing Australia is just so ridiculous that it bears nothing but the scorn of every single member of parliament in this place. I do not intend any disrespect of the Prime Minister—I think he genuinely tries hard in this matter—but he has been extremely poorly briefed. You can get details of the Keating discussions with the US Secretary of State saying exactly the same thing 16 years ago. For 16 years this has been going on. What this government is asking—and what governments for the last 16 years have been asking, ever since Mr Keating's stupidity—is that the United States get in step with Australia. What an absolutely preposterous and ridiculous proposition to put before the people of Australia and the people of the world—that Europe should get in step with Australia! Europe probably has four or five capital cities that have a bigger population than does Australia. Most certainly Los Angeles has a bigger population than does Australia. And we are seriously saying that these people should get in step with us! What ridiculous rubbish. No, it is about time that the government of Australia got in step with the rest of the world. Read the OECD document and you will find out that the rest of the world have a 60 per cent support level for their farmers, and do not go around condemning, as the current agricultural minister does, the United States government. He used the word `betrayal' to the United States government—a government that has given us nearly 400,000 tonnes when Europe has cut us from 700,000 tonnes to about 5,000 tonnes. And he goes casting aspersions on them! What for? Because they are looking after their farmers. Isn't that a terrible indictment of them! Isn't it a terrible shame and a disgrace that the government of America should be looking after their farmers!It would be very good if these people put their energies into looking after our farmers; that is, it would be good if they looked after our farmers in exactly the same way as the American and European governments look after their farmers—in fact, in exactly the same way as every other government on earth looks after its farmers. If we do not do that the future for these industries is grim beyond belief. I probably represent the cattle industry more than does any other person in this place. If the cattle industry is in trouble at present, I deeply regret the tardiness of the minister in making a decision on this matter. However, now that the decision has been made by the minister, I must say that it has been a very difficult decision to make and that the decision is, in my opinion, a good one. 16:10:003952Sidebottom, Sid, MPMr SIDEBOTTOM849BraddonALP00—I would like to continue where I left off—and I welcome the Minister for Agriculture, Fisheries and Forestry. I was mentioning before how the industry has been disappointed to the point of anger with the minister's tardiness on this issue and also with the decision that he arrived at without consensus and certainly contrary to his own advisory council and the recommendations made to the Red Meat Advisory Council. I would like to continue with that industry's response today. Minister, I hope you are interested in what they had to say.Mr Brad Teys, CEO of Queensland based Teys Brothers (Holdings) and representing the common interest group of 28 adversely affected processors and exporters, such as the one on King Island in my electorate of Braddon—so this is directly relevant to the industry in my electorate, Minister—and also the one at Longford in the electorate of Lyons, said that his group supported the recommendations agreed to by the six peak industry representative councils through the Red Meat Advisory Council because it was a unanimous industry compromise and it did not reflect the interests of any one particular sector over another. He also said:Claims by the minister that 10 processors would receive windfall quota had to be taken in context. While these processors started from a very low USA performance base, their diversified markets would be adversely affected under the proposed quota management scheme. Every exporter must be prepared to share the pain, and the RMAC recommendation is a whole of industry position.I am sure that the minister would have taken some time to read the submission by the Australian Meat Council to the Red Meat Advisory Council, where they work through those options but say that they believe that, for the betterment of the industry, a consensus arrangement is the best result. But, Minister, you have taken it upon yourself to reject those recommendations, for reasons which are totally baffling to the industry itself.The effects of your decision, Minister, and also your tardiness will, as I said before, greatly affect processing in my electorate of Braddon, particularly on King Island. I think it is really important that you see how the effects of your decision will, when localised, act in a negative way on a very important industry. King Island Abattoirs, which work very closely, obviously, with the King Island producers, have moved significantly away from the Japanese market to the US market. It is their belief that, with the tardiness that has been in operation and your support of the bigger producers, the quota may well have already been filled to a great extent and that their potential market in the US will be lost, having serious consequences for this industry. The abattoirs, for your information, Minister—I am trying to localise this and make it a bit more personal—have a work force of 70 and, like most abattoirs, use local tradesmen for maintenance work. They are one of two major employers on the island. They injected over $22 million into the local economy, an economy made up of 1,700 people. They already operate at a distinct disadvantage to mainland operators when you compare the cost of freight, electricity and so forth for their industry. They are at a distinct disadvantage but they are highly competitive. Any threat to their ability to enter a market will have a detrimental effect on that business and will have significant effects on the island itself. The King Island producers are quite significant, given the size of the island and the number of people. There are 236 beef producers who supplied King Island Abattoirs last year, and they operate family farms using family labour only. Many employ both partners and some also employ their sons and daughters. However, there are also 25 farm employees working on wages. The industry supports, as you are probably aware, a number of agricultural contractors for seasonal operations such as haymaking and fertiliser spreading. There are approximately 85,000 beef cattle or one in five of the total Tasmanian herd. That is how significant this industry is to Tasmania.Benchmarking by Holmes Sackett and Associates has shown that the cost of production of beef on King Island is 10 per cent higher than in southern Australia and the price received is 10 per cent less. It is the biggest employer on the island. (Extension of time granted) It also indirectly supports all businesses and services on the island. That industry is threatened because of your decision, Minister, and the tardiness of your decision making. There are hundreds of producers and processors in Australia who are affected by this. To read their press releases condemning your inaction and also your decision bodes ill for your management of this sector and shows their great disappointment in you. I believe that the campaign to get you to change your mind will go on and on and I think you have a great deal of explaining to do. There are jobs at stake here and the future of an industry is at stake. An ability to diversify and have an equal share of markets is very important. I hope that you will take the time to answer their criticisms of your decision making and that you show a lot more leadership and equity in terms of this industry. 16:16:003954Truss, Warren, MPMr TRUSSGT4Wide BayNPMinister for Agriculture, Fisheries and Forestry10—I am conscious that other members wish to speak and I will respond to other comments later on, but I thought it might be appropriate to deal with this particular issue raised by the honourable member for Braddon while he is still here in case he is of a mind to run off. The reality is that we have a 378,214-tonne quota on beef to the United States. It is our objective to have the size of the quota increased and we have been pressing hard to achieve that increase. But until that can be achieved we can send only 378,214 tonnes of beef to the United States. Quota allocated to one company is quota that is not allocated to another company. Jobs created through this quota in one town are jobs that are not created in another town. The reality is that if the honourable member for Braddon, for instance, is asking for quota to be allocated to an abattoir on King Island, that is quota that will have to be taken off an abattoir somewhere else in Tasmania or somewhere else in another state. I cannot make the tonnes bigger. The reality is that we are dividing 378,214 tonnes amongst 60 or more processors who would like to be supplying to the US.I do not want to talk too much about the commercial-in-confidence matters of individual abattoirs, but the honourable member has raised a particular case. This is an example of an abattoir that has never been interested in the US market in the past. They have been supplying to Japan, and they have been supplying Japan because they could make more money going to Japan, which is a perfectly reasonable thing for them to do. They have chosen to supply the Japanese market. There was nothing stopping them from going to the US market up until late last year—the quota had never been filled until that time. So if this particular company had wanted to go to the US it was perfectly at liberty to do so.This company's interest in going to the US no doubt arose because of the decline in the Japanese market. The market they had concentrated on had gone soft. In fact, this particular company had supplied only 0.1 per cent of its production to the United States last year. But because they can no longer supply to Japan, they would now like to supply to the USA and they are asking some other company to give up their US market share so that they can supply the US. The only way that anyone can give them more tonnes to create more jobs on King Island is to take those jobs away from another town. I have no objection, in a free market, to one company competing against another and taking market share away from another, but it is a different thing to ask a government to intervene and force one company to cancel its contracts so another one can open up a new market.That is what the honourable member for Braddon and RMAC were essentially asking me to do. They were asking me to intervene to take contracts away from those who had concentrated on the US market year after year—who had built their businesses on the US market—and give them to others who had in fact preferred to supply to a more profitable market in Japan and who were now unable to deliver into that market. I think that creates a real philosophical difficulty. It is one thing for market forces to prevail and it is another thing to ask a government to intervene and to shift contracts from one company to another.The honourable member suggested that the decision of RMAC was unanimous. Yes, it was a unanimous decision of the bodies that were represented on RMAC. But the suggestion that it was unanimously supported by an industry could only be put forward by somebody who has not read any newspapers. The moment the RMAC proposal was released, a whole avalanche of criticism was directed at the proposal from those whose quotas would have been cut as a result of RMAC's proposal. The reason RMAC was able to reach agreement was that it was representative of the bodies that were advantaged by its proposal. Those that were disadvantaged by its proposal did not get the opportunity to have their say. That is the reason I had to take into account not just the majority view but also the minority view. Any democracy considers the minority as well as the majority. What I have endeavoured to do is to come up with a fair outcome that shares the pain. I acknowledge the fact that there is pain. There is not enough quota to go around so there is pain, and that has to be shared. I believe that the proposal I have put forward has done it in the fairest possible way. (Time expired)16:21:003955Windsor, Antony, MPMr WINDSOR009LPNew EnglandIND00—There are a number of issues that I would like to raise. Firstly, in relation to the comments the Minister for Agriculture, Fisheries and Forestry has just made, it is a difficult area that he is working in and I take on board the points that he made—that if you remove quota from one area and impose it on another you obviously have an impact on that particular area. Although the meat processors in my electorate are not delighted with the process, under the circumstances they are supportive of the minister's removal of the RMAC recommendations. Given the make-up of RMAC—the fact that not all members of the group are involved in the export of cattle meat—maybe there is some need to review that as a proper consultancy body in relation to these sorts of decisions so that this sort of thing does not occur again. In summary, I would say that it is a very difficult area to work in. However, even though my people will suffer some degree of quota loss in percentage terms because of the jobs that are in their area at the moment, they would encourage you to keep going. There are a number of other comments I would like to make. I am particularly pleased that the minister is in the chamber because it is an area that he has been involved in for some years now. Maybe he can clarify some of the issues that I am about to raise, which specifically relate to the National Action Plan for Salinity and Water Quality. There have been various utterances over time from the minister, the Prime Minister, the Deputy Prime Minister and others in relation to the definition of property rights and how that can be wound through the system not only in terms of the national action plan but also in other areas of resource management. I refer the minister to the launch of the national action plan on 10 October 2000. In welcoming the $1.6 billion announced by the Prime Minister in October 2000, Mr Truss—and if I am verballing him no doubt he will let me know—said:The plan recognises that actions required to sustain the environmental health of a region may affect the property rights of individuals and some local economies. Compensation must be payable under the plan to those adversely affected.This is a comment with which I agree. In a briefing note entitled `The action plan at a glance', Mr Truss went on to say:In regard to policy improvements, the Action Plan proposes Commonwealth, State and Territory Governments agree to supporting an agenda of key land and water-use policy initiatives. These include:· land-clearing controls on salinity risk areas;· caps on surface and groundwater allocations;· improved security of property rights for water together with improved water pricing and trading arrangements;· `buying back' water allocations to achieve sustainable water use.Since then, there have been a number of negotiations with the various government authorities in the various states and obviously we have had the argy-bargy of state-Commonwealth relations about who bears what. However, an intergovernmental agreement was signed last year and, in that agreement, the issue of property rights was essentially not raised at all. There was a perception that the property rights issue would be raised with the bilateral agreement, which each state has now signed with the Commonwealth—although it may be that Western Australia still has not done so. The Prime Minister only recently signed that particular document, which involves something like $398 million, half of which is to be borne by New South Wales and half by the Commonwealth. On the signing of that document, we again had no mention of property rights. The only property right that is included is the definition of property rights as included under the New South Wales water act 2000.So there are some very real concerns that a number of comments have been made by previous ministers and the Minister for Agriculture, Fisheries and Forestry, who is here today. We are still drifting on in terms of questions such as what is a property right, is there a clear definition at the federal and state levels, and can how programs such as the national action plan and the Natural Heritage Trust embrace the property right? (Extension of time granted) When I was critical of the Deputy Prime Minister recently at the signing of the bilateral agreement with the New South Wales government, he was very quick to respond to my criticism that property rights have not been included in the national action plan bilateral agreement with the state of New South Wales, and put out a fairly scathing press release entitled `Windsor's lack of understanding on water astonishing'. As part of the criticism of my `bizarre' press release claiming that the signing of the national action plan had signed away property rights for farmers and any leverage that the federal government may have had over the states, which he described as being quite bizarre and `unmitigated rubbish', John Anderson stated:The Plan specifically recognises compensation because I put it in.I would like the minister to answer some questions: which plan are we talking about, where is it and when was it put in by the Commonwealth? The Deputy Prime Minister went on to say:The inter-governmental agreement on water quality and salinity—this is the intergovernmental agreement, not the bilateral agreement—signed between the Federal and NSW Governments provides that compensation and structural adjustment issues will be dealt with under the regional catchment plans.This is a very important point about the regional catchment plans, because they are currently in draft form in New South Wales. I think there are 21 regional catchment blueprints across New South Wales that the NAP covers. But the key point here—and I am quoting the Deputy Prime Minister—is:There is no need for the issue to be dealt with again in bilateral agreements.This is the one that has just been signed by the Prime Minister for $398 million. The Deputy Prime Minister also said:Regional plans will require the agreement of the Federal Government and I make it quite clear that plans will not be approved, and Federal funds will not flow, unless property rights issues are dealt with to the Federal Government's satisfaction. Minister, as you are responsible for this, what do you deem to be `to the federal government's satisfaction'? I understand meetings are being held in Sydney today, where members of your department are talking with the people of the Namoi-Gwydir and other catchments. Are you aware that the regional blueprints that Mr Anderson referred to do not include a definition of property rights? Does that mean that, if they do not include property rights—and they definitely have not been encouraged by the state government to include property rights—there will be no flow of federal funding through the bilateral agreements that the Prime Minister has just signed?I would like you to make a few of those things clear, if you could, because it seems to me that a great deal of significance is being attributed to these regional catchment blueprints. The community is involved in putting those blueprints together—because there was an expression through the NAP, which I agree with, that the community has to drive the process—but the community is not driving the process towards any recognition of a property right. There is a need for some leadership from the Commonwealth in relation to that particular issue. I also draw the minister's attention to the Senate estimates committee of 28 May, where a senior officer of AFFA, Ian Thompson, referred to the national action plan as being a possible source of federal funding for the Namoi groundwater entitlement adjustment process. I would be interested to hear the minister's comments as to how that can possibly occur if there is no recommendation coming back through the regional catchment blueprint that the Deputy Prime Minister has referred to as being the key ingredient in the process. Will the $40 million that the federal government is talking about as part of an adjustment package for the Namoi groundwater issue be partly available for compensation in terms of entitlement loss or will it be only available for other sorts of structural adjustment?16:31:003957Truss, Warren, MPMr TRUSSGT4Wide BayNPMinister for Agriculture, Fisheries and Forestry10—Without wanting to cut off the member for Kennedy, I will respond to some of the issues raised by the member for New England, mainly in relation to the national action plan and property rights. The government is certainly committed to a proper system of property rights and the recognition that, if an individual land-holder or property owner is required to make compromises in the interests of achieving an overall community objective, in relation to water use or some other purpose, the community then has an obligation to compensate for that loss of right. That is a clear principle that the government has stated on many occasions, including I guess in the media release that the honourable member referred to. This principle was agreed to by the states in the original COAG agreement. It is a very important element of this exercise that right back at the beginning, when the NAP was agreed between Commonwealth and states, the property rights issue was entrenched. The specific way in which property rights issues and any compensation matters would be addressed is to be a matter for particular catchment plans, and it will obviously have to be addressed in accordance with the impact that there is in each instance.In many of the regional plans there may be little or no impingement on individual land-holders' rights. I would hope that in most cases solutions can be found without the wholesale extinguishment or a reduction of rights, but we know that in some places there is overallocation, and those issues have to be addressed. The Deputy Prime Minister has on a number of occasions referred to the particular concerns of the Namoi Valley and the need to put in place a regime to get that water use system in balance. As to how that would be funded: as yet there is no concrete proposal on the table, so it is mere speculation as to how it would be funded. The intention was that if it is a $120 million scheme the funding would be roughly one-third federal, one-third state and one-third from the local land-holders. Once there is a concrete proposal around, the Commonwealth will have to look at how it would source its share of the funding. The departmental officer made a reasonable statement when suggesting that one option is the NAP funding, and there are several ways in which the NAP funding could be used for that sort of purpose. But it is not the only possible source of funding should that project get under way.So I can repeat again our commitment to the view that land-holders do have rights and that those rights have to be accepted. Just as we would compensate someone for building a road through their property, where we reduce their access to their water rights or their vegetation rights or the like, there needs to be an expectation that there would be community compensation for that right reduction. Some states—like South Australia, for instance—have already provided substantial compensation to land-holders from state resources as a result of their vegetation management laws. I think that is an example that other state governments should have already followed by now. I want to emphasise the point that the Constitution makes it abundantly clear that land management issues are the responsibility of the states. We expect states like New South Wales and Queensland to be taking the lead and accepting their primary responsibility for land management issues, including any restrictions of rights that may be required to ensure the sustainable use of resources. I hope that is helpful to the honourable member. Certainly we have not, in any way, compromised or given way on our intention to ensure that property rights are appropriately compensated where they are infringed. 16:36:003958Katter, Bob, MPMr KATTERHX4KennedyIND00—In defending the government's decision on the beef quotas into the United States I will say that my family owned a clothing store in Cloncurry for the best part of 100 years, and we spent a lot of time developing markets onto the big cattle stations in the Gulf country. We built up relationships: we made arrangements for agency fees, looked after stockmen when they came down to town—put them up overnight in some cases—and did numerous other things, such as looking after their entry forms for the local rodeo. But if a government were to come along and say, `Nicky Powers up the road has had a bit of a rough time, so we are going to, by law, take some of this market off you and hand it over to him,' I think that that would be very unfair. Whilst it is not quite as simple as I am making it out to be, in answer to the criticisms I must say that I cannot see how a government can justify itself by coming in and taking away a market and relationships which have been developed over decades between the traditional sellers into the United States market. People made a decision to go into the prime beef market in Japan and that, albeit through no fault of their own, has proved a very bad decision, but the government cannot redress every bad commercial decision that has been made, even though the people may be entirely innocent.Having said all of those things, it is highly desirable that we keep open every single meatworks if that is humanly possible. Concessions have been made in the new rules which have taken market away from some of the meatworks that operate in the area that I represent. I suppose that it can be said that, coming from a grinding beef market area, I would have prejudices along the lines of the current arrangements, but I think the overall picture here is that the government did not have much alternative but to make the decision that they made, and I do not doubt for a moment that that will stick. As for assistance to some of the meatworks that will be placed in trouble, not as a result of the decision by the government but by the decision of Japanese consumers who are not now buying beef that they were buying previously, if there are solutions to those problems such as extra advertising into the Japanese market or labelling which indicates that beef is Australian beef and not Japanese beef, I think that those things are issues that could be addressed and could be very helpful to some of the people who are quite understandably unhappy over the arrangements. But I would strongly urge the government to maintain the current situation. The decision has been a good one. However, once again I reiterate my criticism that it was made far too late and has left very grave uncertainty, particularly as we are running towards the end of the market year for Australia.16:39:003959Truss, Warren, MPMr TRUSSGT4Wide BayNPMinister for Agriculture, Fisheries and Forestry10—Could I comment on the issue of the timing of the decision, which the honourable member for Kennedy has just raised and which the member for Braddon also raised earlier, as to why we have intervened only at this comparatively late stage of the export year. Firstly, it is important to point out again that we have only once ever supplied the whole 378,000 tonne quota, and that was last year. It was supplied about two weeks before the end of the shipping year. It was not clear—and I guess it is not absolutely clear to this day—that we would fill the quota this year. I think, on balance, that we will, but exports were actually running below last year's figures up until only a couple of weeks ago, so there was a reasonable possibility that if we did fill the quota, it would be only at about the same time as we filled it last year, and therefore there was not really a management issue of concern. The industry first seriously came to me about the prospect of managing the quota in about March of this year. I indicated that my preference was for the government not to intervene; that it was the sort of thing that the commercial forces should seek to regulate in their own way. I asked the industry to try and find their own arrangements, their own way, to put in place an appropriate management scheme. There were some half-hearted efforts to do that. Subsequently, RMAC was commissioned to endeavour to put together an industry consensus. They had a couple of attempts at that and then, finally, came to me with their proposal. I think RMAC genuinely tried.The honourable member for Kennedy spoke about having some prejudice or something or other. Everybody did—everybody wanted to get as much quota for their meatworks as they possibly could. That was a perfectly reasonable commercial thing to do, and everybody wanted more than was available. So no matter what decision was to be made, everybody got less than they desired. Even if we had had another 100,000 tonnes, I suppose they would have desired to have even more. So everyone was going to have to take a degree of the pain and, naturally, everyone was trying to shift that pain onto others as much as they possibly could. That created a very difficult environment for RMAC when I asked them to achieve industry consensus. I think they genuinely tried, and they got a fair degree of the way. I want to repeat the point that I made, which some have criticised, that I accepted most of their recommendations. I think they had 14 points and I accepted in full, I think, 11 of them—one I rejected and two I modified slightly.The key difference between what I proposed and what RMAC proposed was that I put caps on the gains and caps on the losses. That meant that heavy impacts would have occurred, with some people—half a dozen or more—getting windfall increases of 1,500 per cent or more; the highest being a 5.4 million per cent increase. I appreciate that was off a very small statistical base, so it is a meaningless figure. I am not trying to make much of it. The reality is that there were significant windfall gains. There were—I forget the number—15 or 20 abattoirs that would have got a quota and that had never delivered to the United States. I felt that was unreasonable and that that sort of thing should be capped. On the other hand, I felt that it was too harsh for those who would be asked to take 40 per cent cuts in two successive years, and that we should limit the damage that was done to those particular meatworks. That is why I made the most significant change to the RMAC recommendations: capping the gains and the losses. I think that was done in the interests of fairness. It is true that there are still people who are disadvantaged, but I think the losses and the gains are significantly less than they otherwise would have been. When you look back on the history of the event, I think it is only in the last few weeks that we have been absolutely convinced that the quota will certainly be filled this year. I take up very much the point that the member for Kennedy made: we should not be abandoning the Japanese market. Some processors have been a bit too keen to walk away from it. Those who are experts in that market are the ones who are best equipped to rebuild it, so they should not be walking away and trying to break into the US market and forgetting their links in Japan.The industry spent about $11 million last year in promotion of the Japanese market. (Extension of time granted) The processors indicated that they would build on that $11 million campaign. Unfortunately, they did not produce their money. Now they are proposing that they go in and do a little bit, but I think we have lost a lot of the opportunity. The Americans have moved into the market and are biting into our share in a way that I think is most unfortunate. The Japanese market is still the highest price market around and it should be one we put a lot of effort into retaining.I certainly support the member for Kennedy in his views that we should be putting effort into rebuilding the Japanese market and doing our level best to maintain our market share there rather than having this gold rush effect, this avalanche effect, into the US market, which is still limited to 378,214 tonnes—although to be fair we can take any amount of beef we want to into the US but there is a 26 per cent tariff on deliveries above that. A number of meatworks have indicated to me that they will be delivering and paying the tariff. They consider that to be the best available alternative option. That is a commercial decision that they are free to make.I think it is important that we maintain the Japanese market as best we can, that we share the proceeds from the US market fairly and evenly and that we have a system in place that is reliable and that people can understand so they can take advantage of the opportunities that it offers. I remind you that people can trade quota, one to another, and quite a bit of that will undoubtedly happen because some of the people allocated quota under this arrangement with the US have no intention of supplying to the US. They will just sell their quota to others who are interested in that market. So there is a degree of flexibility there.I have also indicated that in the middle of next year we will review the whole system to test how it has worked. In the light of how successful we have been in getting a larger quota, I hope we will not need to go through this exercise. It may well be that the issues will all disappear. But we do need to look at it in the middle of next year to make sure it is going okay and, if not, make adjustments to ensure that it works effectively for the future.16:47:003961Sidebottom, Sid, MPMr SIDEBOTTOM849BraddonALP00—I thank the Minister for Agriculture, Fisheries and Forestry for being here, and I mean that sincerely. It is a good thing because at least we can ask the minister questions and he will at least attempt to give an answer, and we do value that. It would be great if this could happen more often. Minister, I have a couple of points. You mentioned that you believed that it was only quite recently the industry was prepared to act and indeed that your attention was brought to the fact that action was required. I notice in the Australian Meat Council report to the Red Meat Advisory Council that in actual fact the industry gave strong indications and warnings as early as April 2001 that there would be a need for a scheme to manage the quota. That appears contrary to what you just said. I would like your comment on that.Just for the record, you mentioned the King Island Abattoirs and their relatively new entry into the US market, but I would point out, in terms of trying to localise this, that approximately 60 per cent of their production is into the US market as of now. That is significant. They were owned by SBA, which saw a significant proportion of their production going to the US, as well as to Japan, as you rightly pointed out. King Island Abattoirs did indeed specialise in Japan, but 60 per cent of that production now is to the United States under the Tasman Group that they are currently owned by.Minister, I would also like you to explain why it is you rejected the 60-40 quota—that is, the proposal of the 60 US to the 40 global production. Why did you reject that proposal? I would like you to explain that a little bit better because, in terms of the public perception of this, that is what was rejected. I would like you to explain that a little bit more to us so that we can try and get a proper handle on the rationale that you have created for this. I would also like you to try and explain what effect this might—but hopefully will not—have on King Island Abattoirs.My last point—and I think the member for Kennedy raised it—is the whole question of how we are going to assist those abattoirs and those producers that are going to be seriously affected by this. I do not think it is a question of just letting the market forces flow there and not trying to assist them in diversifying their markets—something which I thought the 60-40 proposal intended to do. 16:50:003961Truss, Warren, MPMr TRUSSGT4Wide BayNPMinister for Agriculture, Fisheries and Forestry10—In relation to calls for regulating the quota, you could probably go back to when it was first increased in around 1998 and some suggested that we should have put in place a regulation scheme even though we were only delivering a relatively small proportion of the total quota. With the benefit of hindsight, that might have been a good time to do it, when there was no pressure on the quota and it could have been allocated at a time when the issues could have been considered in a perhaps more rational environment than now. But we let that opportunity go in those days. It was not considered to be a pressing issue and so it was left. Certainly, looking at the statistics for deliveries, by April 2001 there would have been only a small proportion of the industry, if any, who would have believed we were going to fill the quota. If you look at the graph, the deliveries increased very substantially in the second half of the year.There have always been calls to manage quotas, but there are other views in the industry. In fact one of the great old fathers of the industry said to me only a week or two ago that the government should never get involved in the management of quotas because whatever we do is worse than what would happen if the market is just left to run according to its own forces. I think in this particular case the industry is right: the effect of not managing the quota would have resulted in this instance in a gold rush as everybody, particularly the big meatworks, dumped as much meat as they could into the US in a hurry. By September or October this year, people who had monthly contracts year in, year out would have turned up and not been able to get into the market without paying a 26 per cent duty. If this regime falls over, one of the impacts will be that we will no doubt have this gold rush over a couple of months and then we will have a period of several months at the end of the year when people will be unable to enter the market. That would give us a boom-bust situation, which is the very worst possible outcome for anyone. Many of the critics of my distribution scheme have said that whilst they do not like the scheme at least they would prefer it to having nothing, because it does provide some degree of regulation in the market.In relation to the query concerning 60-40, RMAC recommended a 60-40 distribution. I have accepted a 60-40 distribution. The distribution that we are proposing is on the basis of 60-40. However, I have capped the maximum gains at 140 per cent and the maximum losses at essentially 15 per cent or 85 per cent of quota. I have made that an overriding criterion above the 60-40. So instead of some people getting 1,000 or 2,000 per cent they only get 140 per cent, but others who might have only got 50 or 60 per cent will get this minimum of 85 per cent. The 60-40 rule is still there; I have just capped the losses and the gains.16:53:003962Windsor, Antony, MPMr WINDSOR009LPNew EnglandIND00—I congratulate the minister on being with us today. It is good and I think there should be more of it. Minister, I am sorry to bring you back to the property-right debate, but there is some confusing language and confusing messages are being sent. The Deputy Prime Minister on 13 May said that the national action plan `specifically recognises compensation because I put it in'. It cannot be in a draft. It has to be in some plan somewhere. I would like you to identify the plan we are talking about. You inferred in regard to the catchment blueprints that that plan may well but not necessarily have some identification of some compensation or property right. I think you said that if it was in a catchment blueprint the Commonwealth government would consider that.My question is: have you encouraged the regional catchment committees—the 21 that are recognised in the national action plan—to include a definition of property rights where the removal of some resources or management practices may be in the interests of that particular catchment? If you have, I do not think it seems to be filtering through to them. If that is the only plan that the Commonwealth is going to recognise, do you think it may well be time that the Commonwealth gave some instructions to those committees that they identify in the plan the removal of some of the management practices and probably some entitlement if they feel that that may be part of what is going to happen in the catchment to get water quality and salinity into balance? Otherwise you run the risk of the various states running renegade again, and I do not think I have to tell you about New South Wales's performance in relation to this.Minister, you were very involved with the Namoi Groundwater Management Committee. I thank you for that, and I particularly thank you for the membership of the committee. I think Ross Dalton from the department was invaluable in terms of that particular process. The question that I would like you to consider is: if, as in the case of Namoi-Gwydir, there was a specific recommendation through the regional management blueprint that suggested the removal of active entitlement—because, in some zones in that particular area, there will have to be active water removed—would the Commonwealth government consider compensation by way of property right recognition? Is that the sort of thing that you are talking about, the case of a catchment blueprint actually identifying some active entitlement that has to be removed for the greater good of the aquifer or because of salinity ramifications? To use the language that has been used recently, Mr Anderson says he has got it in a plan somewhere, but we have not seen that plan yet. If the plan recognises property rights, the Commonwealth has the capacity to withhold not only its contribution but also the state's contribution of $198 million. Does the Commonwealth really have the constitutional capacity to withhold the money the Prime Minister has just signed off to New South Wales? If it does—and I would like to see that it has that capacity—would it have the capacity to transfer that money directly to those impacted if they were indicated through the catchment blueprint? In a sense, that is allocating what would have been state money but, because of the recalcitrance of the state, transferring that money directly to those who are going to be impacted. Minister, I ask you to consider those questions in a brief answer. Also, do you see the issue of property rights coming up at the next COAG meeting? 16:58:003963Truss, Warren, MPMr TRUSSGT4Wide BayNPMinister for Agriculture, Fisheries and Forestry10—Perhaps I need to go back a little further. I will have to take on notice your questions, which are asking for a legal opinion which I am obviously not competent to give. I am not sure that I am entitled to give a legal opinion even if I were competent to give it. Certainly, I think it is more important to go back over the history of this whole affair and how the Commonwealth has acted and, in this regard, I hope I can respond also to your last question.At the COAG meeting on 5 April 2002, the Commonwealth secured a commitment from the states and territories to report back to COAG by September 2002 on opportunities and impediments to better define and implement water property rights regimes, including water trading markets and, where appropriate, the responsibility of water users and how they are addressing those uncertainties. This follows on from the commitment that was made at the time of the NAP to address those property rights issues. You are absolutely right to refer to the enormous difficulties that are occurring, particularly in New South Wales, in relation to definition of property rights. Some of the legislation and proposals put forward by the New South Wales government are, I think, quite abominable and simply fail to address the issues. That is a matter of genuine concern.Through the last COAG meeting, the Commonwealth has secured a commitment from the states to report back at the September meeting on their progress on developing appropriate water rights regimes and their mechanisms for delivering compensation where that is appropriate. At that time we will be in a far better position to assess where each of the states is situated. I think most of us know off the top of our heads that certain states are quite well advanced in this area and have a pretty detailed trading regime in place. In one state in particular it is working pretty well. In other states there is virtually nothing there. That is holding back the capacity to develop appropriate resource management systems and, for that matter, it is damaging the confidence of farmers and land-holders who are seeking to invest on the basis of the water rights that they have always assumed existed.So, in relation to the definition of property rights, more work clearly has to be done on what are legally enforceable, tradeable and compensatable rights. Some states are embracing that task with enthusiasm, others with a lesser degree of commitment, and the Commonwealth is seeking to impose a degree of rigour on that process at the very highest level through COAG.17:01:003964Katter, Bob, MPMr KATTERHX4KennedyIND00—The minister has placed an emphasis upon the saleability of these water rights and there is no doubt that between one farmer and another farmer there is some advantage in saleability. But what happened in Mareeba when this national competition policy was imposed upon the state government—at least, it is the claim of the Queensland state government that it was imposed upon them—was that, when the sales came up, two companies that were selling, effectively, ways of diminishing tax bought up all of those water rights and paid prices that the rest of us could not dream of. A number of farmers who had wanted to get out of farming tobacco and who had only 20 acres and wanted to grow bigger, to 100 acres of irrigation, were unable to buy those water rights because of big corporate money coming in and buying all the water rights up.In his submissions on national competition policy, Ernie Bridge, the very famous promoter of water development in Australia, quoted the head of Bankers Trust. At the annual stockholders meeting, or whatever they call it, Bankers Trust told their shareholders, `As always, one of the most valuable items in our portfolio is our water rights. They will always go up and will always have an extremely solid value.' What happens if corporations like Bankers Trust are buying up all of the water rights that exist in Australia, if farmers badly need to buy up some of those water rights, and if you as a federal government are cutting back by five, 10 or 15 per cent on current water usage levels? If people are to maintain their economies of scale, they need to buy some water rights. But if they are competing in the marketplace against giant corporations—and it is said that one-third of the Californian water rights are owned by giant corporations and a further one-third are owned by not so giant corporations—what is left for the owner-operator family farmer here? What chance has he got of achieving economies of scale when he is competing in the marketplace against the likes of Bankers Trust? We view this with very great concern. I strongly endorse the comments and the representations made by Ernie Bridge—a very gifted Australian—when he says that ultimately all of our water resources will be owned by foreign corporations. We view with very great concern this tradeability of water rights as it applies on a free market system to big corporations. We most certainly agree with the movement of water between one owner-operator and another owner-operator. I must share the concerns of my colleague from New England in listening to the assurances we are receiving on this compensation. I do not blame the minister for agriculture for this—clearly it is a government decision and not a departmental decision—but I am becoming more and more apprehensive on listening to the assurances I am receiving here. I most certainly do not hesitate to criticise ministers, but I am not criticising the minister in making these statements. I hear with increasing apprehension what is being said to us by way of explanation to convince us that things are under control. I am more and more convinced that things are not under control.17:06:003964Truss, Warren, MPMr TRUSSGT4Wide BayNPMinister for Agriculture, Fisheries and Forestry10—If there are no other comments I will just summarise in response to a couple of the other points that were raised. I think it was the member for Kennedy who suggested that the AFFA appropriations had been reduced this year. In fact they are up by $14 million, to $198 million.HX4Katter, Bob, MPMr Katter—That is not in Budget Paper No. 1.GT4Truss, Warren, MPMr TRUSS—That is the AFFA appropriation. I suspect that the figure that may have led the honourable member to his assumption lies in the fact that included in departmental appropriations are special amounts that are allocated from time to time for major disaster relief programs, and there was a major program, as you are aware, in northern New South Wales to deal with flooding and the disaster in that area. That program will expire and therefore is not provided for in the year ahead. But if there is another disaster and more funds have to be provided then I suppose the funds will go up. That is the sort of funding cut I like to have: made because there are no disasters around. If we had large numbers of exceptional circumstances applications, that would also result in increased allocations. When there are lower numbers those allocations go down. Basically the department's programs will be able to be maintained in the year ahead. We have a number of quite significant new initiatives, particularly the new National Food Industry Strategy. The new food council had its first meeting today, so that is on schedule to be up and running on 1 July as promised. That is a very significant new initiative to help position Australia much better as a supplier of processed food to the world. Australia has been losing market share in the processed food sector, and yet that is the fastest growing area of world food trade. Whilst our industry has a number of success stories, the reality is that we are not well linked into the new global supermarket concept. If we want to be more than just suppliers of raw materials then we will have to have a strategy in this country to attract centres of excellence and to have the kind of trading environment that encourages major investment in this country rather than in competitor countries around the world. The purpose of this strategy is to value add our products in Australia, rather than having the jobs created in other parts of the world, and that is very much the centre of the budget appropriation.I thank honourable members for their contributions to this debate. I also thank them for the spirit in which we have been able to exchange views on particular issues. Where I might be able to supply more information, particularly perhaps to the honourable member for New England in relation to those questions of law that he asked, I will endeavour to do so. I suspect, though, that he may be asking questions that only the High Court one day will answer. I hope that we can resolve those issues more readily and more ably than that. Our key objective in relation to resolving these issues, which are clearly the constitutional responsibility of the states, is to do it by way of agreement rather than having this Big Brother approach—rather than having to force things upon a state that, through the use of financial powers, they ought to be doing in order to be decent governors and decent custodians of their responsibilities.009LPWindsor, Antony, MPMr Windsor—It is the federal government that has raised property rights. The state government has not.GT4Truss, Warren, MPMr TRUSS—It would not even be on the agenda, I suspect, if we had not done so, and farmers would have their rights taken away from them without any compensation. That is simply unacceptable to a coalition government.Proposed expenditure agreed to.Department of the Environment and HeritageProposed expenditure, $515,815,000.17:09:003965Thomson, Kelvin, MPMr KELVIN THOMSONUK6WillsALP00—In my response to the budget, I spent quite a bit of time talking about my concerns in relation to the Environment and Heritage portfolio. I do not need to canvass all that ground again, but I do want to recap on one aspect of it and bring to the attention of the parliament a specific issue which has come to my attention since I gave my own budget reply. One of my principal concerns about the environment budget has been underspending: the fact that the government says that for any given year, `We are going to spend X dollars on the environment'—and it does it with a fair bit of fanfare—but at the end of each year when we see the budget papers we find that this amount of money has not been spent. That was true of the department of the environment generally; it was true of the Natural Heritage Trust; it was true of the National Action Plan on Salinity and Water Quality; and it was true of the Greenhouse Office budget and the Measures for a Better Environment package. Everywhere you looked, there was substantial underspending; things that the government promised would be done and would happen simply did not happen. One of the principal areas of concern in relation to this general problem of underspending has been the Natural Heritage Trust. I identified in looking at this year's budget that, in the five-year period from 1996-97, there has been an underspend of $209 million—a massive underspend. Indeed, for the Natural Heritage Trust there was a cut of $24.7 million for 2002-03 and no ongoing Natural Heritage Trust funding for programs as important as the Murray-Darling Basin. I have also made the observation previously in relation to the Natural Heritage Trust that it gets worse than simply this idea that, at the start of the financial year, the government says, `We're going to spend a certain amount,' and it turns out at the end of the financial year it has not spent that money. In fact, we got retrospective underspending with the Natural Heritage Trust so that the amount that the Commonwealth claimed had been spent in 2000-01 was revised downwards by a massive $110 million-plus. When we looked at the environment expenditure statement last year it said that $395 million had been spent on Natural Heritage Trust programs in 2000-01 but, when we come to this year's environment expenditure statement, that figure has been revised downwards by $110 million to $284 million. The government had been claiming that this money had been spent on environment protection and repair; it then turned out that this money was not spent in 2000-01 at all. This is retrospective underspending, and it affects virtually every natural heritage program. My position is that spending delayed is spending denied. I do not think that other portfolios like education, housing, child care, transport or whatever would put up with this idea for a moment: `Well, as long as we spend this money on the environment sooner or later, it doesn't matter when it gets spent.' But it is even worse for the government to be claiming credit for environment expenditure which simply did not happen. I am not prepared to accept the idea of rounding errors between the time of the delivery of the May budget and the end of the financial year on 30 June. Nearly 30 per cent of the claimed Natural Heritage Trust 2000-01 expenditure simply did not happen. I do not believe that any other government department or program would be subject to such a massive downward revision. I want to bring to the attention of the parliament a specific example of the withdrawal of Natural Heritage Trust funding which relates to a program in Tasmania titled `Patchwork: adopt a patch—building community partnerships in local bushland'. This program was established several years ago and it has achieved, as far as I can tell, some very substantial outcomes in the Tasmanian community. It was a program established by the Tasmanian Council of State School Parents and Friends Association, and it went on until September last year when the then environment minister, Senator Hill, refused to provide further funding for it. Those involved in the program were very surprised that its funding had been cut. In fact, there had been a Natural Heritage Trust evaluation of the project in the year 2000 which was very positive. It found that participants had an increased understanding of native vegetation and that they had improved their skills in and their on-ground experience of sustainable native vegetation management and rehabilitation. The project had supported some 6,000 participants in practical bushland management in their local communities, with some 20 sites of threatened species being managed. One of the parents told me that the patch of bushland which they had adopted included habitat for the swift parrot, which is a threatened species. Some 62 management plans have been adopted as a result of this project, with 10 new sites and 20 of the existing sites to be increased by 50 per cent. This was a pretty substantial project, but the government saw fit not to provide further funding for it. I raised this matter in the House back in February and I asked the Minister for the Environment and Heritage a series of questions on notice about it on 14 March. I have recently received his responses. It turns out that, as had been alleged to me, this `adopt a patch' proposal was ranked, by the panel that does these things, seventh out of 95 ranked projects. To my further question:(4)Were projects ranked lower than 7th by the Assessment Panel funded.The answer was yes, there were. In fact, 153 projects were funded all up. This is really astonishing on two counts. The first is that the Commonwealth is unable to spend all the money which it claims it is going to spend on the Natural Heritage Trust. Indeed, in the very area of bushcare, back in 2000-01, the government told us they would spend $100 million. It turns out they spent only $81.5 million. So they have this problem of underspending, yet they are unable to find money to continue this particular project. Secondly, we have got a project which has been ranked by the assessment panel seventh out of 95, and the government are not able to find the money for this particular proposal when they can find money for many other proposals which were not ranked as high. In response to my questions on the Notice Paper, they suggested:... school-based projects ... are not a priority for the Trust, given the focus on local on-ground works.But if we look at the independent evaluation we find that it scores very highly. I also note that the previous environment minister, Senator Hill, had launched a national schools action plan which said that the government accepted its responsibility for encouraging environmental education in Australian society and said that it was developing: ... a package of measures that complement our initiatives in policy and legislation in particular the Natural Heritage Trust ...If you withdraw funding from a project such as this, that is completely inconsistent with those sorts of claims and objectives. Frankly, it is completely unacceptable for the government to say, `We have no money for a project of this character,' when it involves no fewer than 62 schools, when it attracted involvement from the Tasmanian education department and Greening Australia Tasmania and when two of the schools that participated won national awards as a result of their `adopt a patch' work.It is absolutely unacceptable that the government can say, `We're not going to fund this project,' when they fund many other projects that are not ranked as highly and when they are simply unable to spend all their Natural Heritage Trust funds—to the tune of $110 million underspent in one year and $209 million underspent over the course of the past five years. It is simply not good enough. I call on the government to re-examine this particular Natural Heritage Trust program with a view to ensuring that it gets the ongoing support to which I believe it is entitled.17:20:003967Stone, Dr Sharman, MPDr STONEEM6MurrayLPParliamentary Secretary to the Minister for the Environment and Heritage10—I would like to respond immediately to the issue of the underspend. These are allegations that the shadow minister for environment and heritage made immediately after the budget was brought down. Sadly, they reflect a total misunderstanding—or perhaps an incomprehension—of how environmental programs work in this country. The programs are to do with natural resources. Often when you allocate funds to a group—say, to plant trees, collect seeds or maybe fence in a particular area—you have all sorts of seasonal implications. You may in fact find that it is a dry year and it is not appropriate to be collecting seed that year. It may be that you are in a drought area and you cannot do your application for funding for revegetation. You always have a lack of a complete match between funds allocated and funds able to be expended in what are often community based projects under the Natural Heritage Trust. To demand that they show expenditure of those funds on time is just a nonsense. We would end up with people doing work that was not going to be able to survive—like putting into the ground trees that are not likely to be watered.Let me try and explain to the shadow minister just what has occurred with environmental program budgeting right across the board, because he raised a number of projects, including NHT, NAP, AGO and others. Let me begin with the National Action Plan for Salinity and Water Quality. That funding has not been cut. The commitment remains to spend $700 million over seven years, and that is matched funding with the different states and territories. Unfortunately, we had a long and tortuous time with the states as we worked out bilateral agreements on how that NAP would work in each of the states. Again, we have not been in complete control of the timing of the process, but there is no reduction of the funding whatsoever. We are now seeing some significant progress on the national action plan, and I am very pleased about that.I would like to move on now to the Australian Greenhouse Office. Again, the main reason for the underspend on its programs is timing. There are no up-front payments for programs; they are contingent upon achieving milestones. In some cases these milestones extend over many years. For example, grant funding already approved for the Greenhouse Gap Abatement Program—or GGAP, as we commonly call it—includes funding of $107 million approved under round 1. Under negotiated deeds of agreement, these grants payments will be made upon the achievement of milestones rather than up-front. Payments for this round scheduled from 2001-02 will be paid through to 2008-09. There is funding of $48 million under round 2 and these payments are also to be on the basis of achievement of milestones. Payments for this round are expected to commence in 2002-03 and finish in 2006-07.We are talking about intergenerational change here. We are not talking about dollars coming in and achievements going on the board, measurable in a period of one year or even in the life cycle of one government. We are the first government, I have to say, that have understood this and that have been prepared to make commitments such as the seven-year national salinity action plan. We are not pretending for a minute that there is going to be evidence of changes in landscape or in the sustainability of our national resources perhaps for another generation, in some instances.I want to refer, in particular, to the recommendations in terms of the former minister identifying projects that would contribute to the goals of the trust. The member for Wills should be aware that Tasmania has had a very generous allocation or proportion of the NHT. Many of the projects that were funded—for example, the strategic projects in Tasmania—could not be put on the ground in the time frame that the Tasmanian government itself identified because not even the planning controls had been undertaken. Weather and seasons were not taken into account, and in some cases the community had not been consulted.The member for Wills mentioned the `adopt a patch' program. Yes, it was an excellent program. It fully achieved the objectives and outcomes that we hoped it would in the short term. In the longer term we expect to see even more. It was one of those very good school based projects. The shadow minister's remarks reflect his very small understanding of the environmental program across the Commonwealth government, because schools feature in a great number of our programs. (Extension of time granted) For example, the recently launched `Classroom Antarctica' is one of the best curriculum packages you will find. We have a whole range of programs that particularly focus on students through Bushcare—things like Waterwatch and Saltwatch and so on. The shadow minister should understand that, under the Natural Heritage Trust, we are now focusing very much on regional planning bringing through projects, so we would expect that the regions would identify school based projects as they put their plans together and bring them through. 17:26:003969Katter, Bob, MPMr KATTERHX4KennedyIND00—It amazes me that GBRMPA, one of the biggest manifestations in Australia of the Department of the Environment and Heritage, is so universally loathed and detested. It is hard for most people in North Queensland to even mention its name without getting into a rage. There is no doubt that there will be really unfortunate occurrences as a result of actions taken by GBRMPA. You cannot expect that all of the people in Australia's sugar industry who are going to be closed down by GBRMPA will just sit there and idly twiddle their thumbs whilst their lives are destroyed. GBRMPA has stated publicly—not privately but publicly and unequivocally; and it was reinforced by the environment minister at the time of the last election, Minister Hill—that it would enforce the diminution by half of the sedimentation being carried in the rivers.One of the strongest green advocates, the chairman of the Johnstone River Trust—a person who has a lot of courage because he has to stand up to the farmers all the time on these issues—rang me and said, `We have had many fights before but no way am I defending this one.' I said, `How bad is this?' He said, `I would think that you would be looking at the closure of at least a quarter, maybe a third, of the sugar industry of North Queensland.' I say to those people who think this is not going to happen that we did not think it was possible that it would happen in the timber industry. We were given all sorts of assurances at the time of the World Heritage declaration. The government said no, it would not close the industry; that the industry would, at the very most, lose 800 jobs. The most minimal estimate is that the timber industry has lost 3,000 jobs. There are only three mills left in North Queensland and one of them is working off plantation timber. Arguably, there are four timber mills but they are tiny little mills. In fact, as you drive along the main highway you can see that some 12 mills have been closed—each with 100 or 200 employees—and they stand as a monument to the inhumanity of the Australian government to the people of North Queensland. They reacted with great violence towards the minister at the time. If anyone thinks that if GBRMPA proceeds down this pathway it will not result in confrontation of a very unpleasnat nature, then they believe in the tooth fairy.If you think you are going to destroy everything that these people have built up generation after generation in North Queensland, you are wrong. Many of their forebears cut cane in the mud and amongst disease and snakes and crocodiles and floods. They were wiped out again and again. They had to fight the monopoly of the Colonial Sugar Refining Co. for nearly 30 years. They got paid nothing. Cane cutters' hands were such that you could press a pin into them to a depth of a quarter of an inch and there would be no feeling at all. This was really hard and dangerous work which had very high fatality rates. Generation after generation of contribution to the wealth of this country is going to be destroyed by a bunch of city slickers who have never set foot outside their concrete pleasure domes in Townsville to venture onto the reef—none of them I know are fishermen, none of them I know are scuba divers, none of those I know have manifested any affection for the reef whatsoever. A very interesting manifestation of that is the crown-of-thorns starfish. It has been a controversial issue for probably 40 or 50 years now. There has not been one single act by GBRMPA about the problem of the crown-of-thorns starfish. You have to ask yourself: just how genuine are these people? Is this an exercise in power over and violence committed on other people? A lot of people get a big buzz out of exercising judgment. I am sure that a lot of judges, when they pass judgments upon people, get the opposite of unpleasantness out of it. I am sure that some of this is manifest in these people. (Time expired)17:32:003970Stone, Dr Sharman, MPDr STONEEM6MurrayLPParliamentary Secretary to the Minister for the Environment and Heritage10—In response to the member for Kennedy, many Australians are in sympathy with the Australian sugar industry because it has to trade into highly corrupt international food markets where subsidised food product constantly knocks them out of the market. It is, unfortunately, an industry that developed in a time when we did not understand the impacts of loss of soil nutrients entering the marine environment and affecting the Great Barrier Reef—which is of international heritage significance.There is, as the member knows, an independent assessment of the Australian sugar industry—the sugar review—going on. The Great Barrier Reef Marine Park Authority was asked by the independent evaluation panel, one of whom was Mr Hildebrand, to provide input to that review. It was quite right that the authority gave that input, as they have the specialist technical skills to make such an input. There is a structural reform package of some $83 million—a sugar assistance package. Far from being a neglected and abused sector of the Australian agribusiness scene, the sugar industry has done extraordinarily well in terms of Commonwealth and state government assistance.HX4Katter, Bob, MPMr Katter—Real well when you are closing a quarter of it down.EM6Stone, Dr Sharman, MPDr STONE—That is a nonsense statement—suggesting anyone is aiming to close the sugar industry down. The sugar industry's responsible operators understand the need to farm more sustainably. The loss of sugar levels in the cane itself is an indication that soil nutrition is in trouble. GBRMPA have responded to the independent sugar review, quite properly. Agriculture, Fisheries and Forestry—AFFA—is coordinating that independent assessment. We are sure that Mr Hildebrand will do a thorough, careful and independent assessment. Obviously, the issue of pollutants, degraded water quality and run-off will be a very significant part of that independent review outcome.17:34:003970Katter, Bob, MPMr KATTERHX4KennedyIND00—The parliamentary secretary has not addressed the problem which I raised. We are talking about the appropriations for this year. Part of those appropriations goes to GBRMPA and GBRMPA have earned for themselves a most unenviable reputation. There is a standard joke in North Queensland about the classic oxymoron—an environmental scientist. Parliamentary Secretary, I am putting it to you that, after a study was done by someone or other, GBRMPA said that they would get a 50 per cent diminution of sedimentation, and the minister committed himself to cutting the sedimentation by half. Even supporters of GBRMPA are leaving them, saying, `This must inevitably mean a closure of a quarter or a third of the industry.' I do not know if the minister's remarks are meant to be interpreted by me as her saying, `Well, you're done for anyway because you're selling into a corrupt market and you're a goner.' But I have to say that that seems to me to be what you are implying to me, Parliamentary Secretary. Please understand that GBRMPA have said—and the minister has backed them up—that they will halve the sedimentation levels. Parliamentary Secretary, for your information—and I ask you please to verify what I am saying—the reports that I have read say that, in the period prior to land clearing, in the period prior to the coming of the Europeans, if you like, five tonnes of soil was removed from a hectare of land in its natural rainforest state. You must understand that, because of the tree canopy, the land is unprotected in a natural rainforest state. So, in actual fact, for most of the year, the heavy sugarcane regime would allow far less sedimentation to go into the river system than would occur under a natural canopy of rainforest. But GBRMPA are not interested in these simple truths. They seem to have a burning desire to destroy agriculture and close the sugar industry down. I do not think that any objective person in North Queensland, who follows the media reasonably closely, would say that there is any intention by GBRMPA except an intention to see that the sugar industry is ultimately closed down. That is their position. Even if that is not the position of the government, it is extremely unhealthy for people to be left in a situation where they do not know what the future holds for them. If a survey were taken of the sugar industry in North Queensland, I would say that three-quarters of them would say they believe that GBRMPA are determined and probably will get their way, which will ultimately see the closure of the entire industry.To put that in perspective, this industry is still worth about $2,000 million to the Australian economy, it employs 60,000 people and it exists in an area of extremely high rainfall, where we simply have one other option. Bananas are the only other option, and that option could well be cut off by the government's free trade policies. But even given that option, we are already exceeding demand in the Australian market for bananas at the present moment. Thirty or 40 other crops have been tried and, quite frankly, no-one will try any crops now. I must mention that the biodiversity act has resulted in the infamous case of Bosworth. In that case it was, quite frankly, held that flying foxes were more important than the lychee industry and all the other industries in North Queensland which are attacked in massive numbers by fruit bats—in numbers that could not be dreamed of in days past; they are very well fed on farm produce.Returning to the subject of the sugar industry, I want to go into the figures. There was five tonnes of soil run-off per hectare prior to white settlement or European settlement or land clearing—whatever words you want to use. Remember, the land had no cover then because it had a tree canopy. Now it is very heavy. There is nothing on earth that produces as much tonnage of carbon per hectare as sugarcane does. The sort of production figures you get from sugarcane are 110 tonnes per hectare per year. It covers the ground completely; it is very hard for anything to run off whilst the sugarcane is growing. (Extension of time granted) So there was five tonnes of soil run-off per hectare. The scientists claim that it increased to 20 tonnes. I find that hard to believe because I cannot see how you can get much run-off from a field of cane. But, of course, when the fields are fallow, there would be an increase in run-off.I am just basing this upon the scientific research and I am sticking exclusively to the studies that have been done. So we had five tonnes of run-off prior to clearing and 20 tonnes of run-off on average after clearing—I could argue about that figure, but I will accept it. In one study I read it was four tonnes, but the latest figure is 2.6 tonnes. So, in actual fact, the sedimentation levels are below what they were previously. GBRMPA are magnificent in their colossal stupidity. They are a classic example of people who are so far removed from reality that they simply have no understanding of what takes place out there. We had an example of GBRMPA's deceit, when they claimed that the dugong numbers in Queensland had dropped by half. The numbers had dropped by half in the southern half of the Barrier Reef and they had increased dramatically in the northern half—they almost doubled. All that had happened was that the dugong had moved north. It was one of the most stupid mistakes that GBRMPA ever made, because it allows their enemies—people such as me—to use this example again and again. They used the example that the numbers had dropped by half, always quoting sites in the southern half of the Barrier Reef and not the northern half. Of course, when it became known that in the northern half the numbers had increased dramatically, their credibility and standing in the community vanished. I have had a number of fights with AIMS over the years but, in sharp contrast, AIMS enjoys a reputation of scientific and intellectual integrity which is not even remotely deserved by the people at GBRMPA. I must emphasise that the latest figures for run-off are 2.6 tonnes per hectare. Another scientific study says four tonnes, and the original figure was five tonnes. When the sedimentation going out onto the seagrass was cut off, what happened to those dugong in the southern half of the reef? There was a big drought: there was no sedimentation run-off, there was no top dressing of the seagrass, so the dugong had no seagrass to eat and moved north. If you cut off that sedimentation, you must understand that that is going to be very detrimental to the dugong. In fact, because of green harvesting now, there is possibly a problem the other way. But GBRMPA do not even remotely understand this. For those people that are not familiar with the sugar industry, when we harvest, we leave a trash cover on the ground some six to eight inches deep. There are some very green oriented people in the sugar industry and Ross Digman is one of them. He took me on a four-wheeler ATV, which was a bit exciting. We had a look at a couple of crocodiles on the banks of the Johnston or the Tully River—I cannot remember which. Ross had this idea 12 years ago of digging silt traps and, being a very active `greenie', as he would be called locally, he built one. The idea is that all of the run-off from all of his farms runs into a six-foot deep pond that he dug out. It holds most of the water run-off—not all of it, because if there were a big flood it would not hold all of that. For 12 years, the pond has taken the entire run-off of a square mile of sugarcane plantations. All of the so-called pesticides and fertilisers have run into a tiny little pond which would not be much bigger than this room. I had a look at the pond and there were four huge barramundi looking at me, there were insects all over the place and the place was absolutely alive with every form of life. So that pond had taken every single bit of run-off of pesticide, fertiliser, soil et cetera—and here it was, crystal clear, pure and magnificent. I have to admit there is an argument here about wetlands and swamps because I strongly endorse the necessity of keeping some wetlands and swamps. I have to be honest and fair and own up to that aspect of it as well. (Time expired)17:44:003973Stone, Dr Sharman, MPDr STONEEM6MurrayLPParliamentary Secretary to the Minister for the Environment and Heritage10—I will close this sector so that others can speak on other issues to do with the environment portfolio. Let me finish by saying that the member for Kennedy is quoting from a study of the Burdekin which actually showed that current rates of run-off can be measured at over eight times pre clearing and grazing levels in the upper catchment. That is a significant volume of run-off. But the key issue is, of course, run-off of fertiliser. The point is that the issue is not about debating tonnes of run-off or presettlement or current run-off amounts; rather it is the state of health of the inner reef of the Great Barrier Reef, the impact on the inner reef right now and the causes of the degradation of the inner reef. There are major industries there. Tourism and fisheries are also dependent on a healthy reef. If the member would like to pursue these issues particularly, I could organise a specific briefing for him where the Great Barrier Reef Marine Park Authority can explain to him the science associated—HX4Katter, Bob, MPMr Katter—I've read all the scientific reports. I don't need the explanations.EM6Stone, Dr Sharman, MPDr STONE—I think some selective quotes would suggest that you have a problem somewhere. HX4Katter, Bob, MPMr Katter—No, I don't. I have read three scientific reports.EM6Stone, Dr Sharman, MPDr STONE—If you do not want to take advantage of the briefing, that is fine, but the issue is the health of the Great Barrier Reef, particularly the inner reefs. They are in trouble. The biodiversity there is declining. There are a great number of industries which depend on those reefs; as well, reefs themselves have value way beyond their commercial value. That is why we are most concerned to participate in the independent sugar review, which has taken on board the impacts on the environment. This, of course, means it will be win-win. The sugar industry will become more sustainable if it can reduce the fertiliser and soil loss from its properties, and, at the same time, we hope the Great Barrier Reef will be sustained into the future.17:46:003973Katter, Bob, MPMr KATTERHX4KennedyIND00—I am very disappointed with the response by the Parliamentary Secretary to the Minister for the Environment and Heritage. I may as well have not spoken at all. I quoted to her three reports. She quoted back one report to me. That report was done by a very ardent, partisan green activist. It was not a scientific report and was not accepted as such. The other three reports most certainly are scientific. One of those reports is not favourable to my argument, but they are all acceptable scientific reports. The one the parliamentary secretary is referring to is not. What is more, even if it was a scientifically acceptable report, it is one report versus three reports. I would say the three reports win, but maybe one beats three in this place; I do not know. Switching subjects dramatically, I cannot help mentioning one other thing the parliamentary secretary mentioned. I am sorry, Parliamentary Secretary, but GBRMPA has already closed down one-quarter of the entire fishing industry. You said there are other industries there. GBRMPA has already closed down one-quarter of one of them. And tourism numbers cannot expand from the present number; in fact, the present numbers must diminish, because the number of people being allowed to go out on the reef has been reduced dramatically. The numbers of people visiting that reef are far fewer than they are anywhere else in the world, so the proposals they are putting forward are ludicrous. They are not backed by any scientific evidence. We put to GBRMPA that, if they were allowing us to prawn or fish farm on the coast, there would be some justification for the position. But Virginia Chadwick said, `We are all for prawn and fish farming.' I said, `No, you are not. You have actually succeeded in closing more prawn and fish farms than we have been able to open.' She turned to her two sidekicks and asked them, `Aren't we?' They both looked at the ground, so she just said, `Well, we are.' In all fairness to her, I think that she would like to see us move in that direction, but that most certainly is not the position of GBRMPA and she will not be able to overcome the difficulties she has there.Moving on, the midwest plains are in a very advanced state of erosion. This is a natural state of play. It has nothing to do with man affecting the environment—there are hardly any hard-hoofed animals on the inland plain, as you can see on the drive from Townsville to Cloncurry. I offered a bloke $1,000 if he could count 1,000 head of cattle or sheep from the highway, and no-one has taken the $1,000 yet. There are very few because it is a very light carrying capacity country because of the annual end-of-year drought that we have.Every single year we have no organic matter cover, no grass cover, on any of our land in North Queensland from July or August onwards because we only have three months of rainfall and then all of the grass dies off. So very late in the year, by the end of the dry in November, we have no protection for our great inland plains country at all, and the north-west monsoons come in, usually driven by a cyclone, the sky falls and all of these areas become ripping torrents of erosion. We are not good at husbanding our land if we allow this to continue. With assiduous use of government money and an intelligent use of weirs, we feel that we can provide trees—we are taking advice from environmental agencies here—on the banks of these rivers and creeks and we can also provide pasture, which is far more valuable in holding these banks together. So, instead of every year losing probably hundreds of millions of tonnes of our beautiful black soil plains into the sea in the Gulf of Carpentaria, we can in fact protect and build them up.On this, I must give the NHT some considerable credit, because their program of fencing off the rivers has been enormously beneficial for the environment and for the health of our rivers and also, strangely enough, quite helpful to the cattle and sheep industries as well. It has been a very good expenditure of money, and I can say that almost all of the upper Burdekin now is fenced off. That is an excellent achievement for all of the parties concerned, and I must highly praise the graziers, who have, almost to a man, participated in this venture.I must also say that we have no timber industry in North Queensland. We have probably the best area of Australia for growing timber. The rainforest is expanding, and when we constantly hear about how many trees have been removed from the landscape we have a bit of difficulty with that. (Time expired)17:52:003974King, Peter, MPMr KING00AMQWentworthLP10—It is a fact that there is no place in Australia of universal cultural significance which is inscribed on the World Heritage List, a list of what might be described as the wonders of the modern world. But it does contain a number of Australian natural heritage properties. The latest of those properties to be inscribed on the World Heritage List was the Blue Mountains last year. It was my honour to preside as chair of the World Heritage Committee at both the inscription stage and the stage of conferral on the Blue Mountains of the appropriate status, with the people of the Blue Mountains and all levels of government involved supporting that nomination and inscription.I raise this issue now because I wish to place before the parliament the proposal that, within the confines of the appropriations as we now have them, consideration be given to the Sydney Opera House being the first property in Australia to be listed as a place of cultural significance on the World Heritage List. The importance of the Sydney Opera House is that it is, as can be observed, a contemporary building of universal significance which has received acclaim around the world. It receives strong support from grassroots organisations, from architects and from the community generally—not just in Sydney but around the country. Recently, for example, I spoke to a number of architects, including Mr Howard Tanner, a well-known heritage architect, and he expressed support for that proposal. Earlier in the year I was in the Middle East and spoke to one of the leading world heritage proponents of modern architecture, Mr Mike Turner, and he urged upon me consideration of and support for the inscription of the Sydney Opera House on the World Heritage List. It is known that the Commonwealth did give consideration to putting that property forward and that there was a dispute with the New South Wales government. It is my earnest hope that, within the appropriation that has now been made, the matter will be progressed. I believe that there is broad support in the community, in the profession of architects and amongst those who take an interest in these matters, and it would rebound greatly to the credit of not only Sydney but the whole country in the important pursuit of inscribing those properties of world cultural significance—and we do have them in our country.Before I turn to the second environmental issue, I wish briefly to address certain remarks made by the member for Sydney this morning in this chamber. A gratuitous comment was made about me in passing concerning the SACS award. That remark was entirely incorrect and it is regrettable that any such comment was made. I take the first opportunity to entirely repudiate it.The second environmental issue which I wish to address concerns endorsement of the national action plan for environmental education. We need community education and public awareness programs, and such programs are contained within the Ramsar wetlands and biodiversity programs provided for in the appropriations in the budget. I look forward to the amendments that will come forward soon under the Environment Protection and Biodiversity Conservation Act 1999. I hope that, in conjunction with these, an education program for our schools will be put in place, particularly in my area. I wish especially to see education about the marine environment, whaling and toxicity because those issues concern the people of my electorate and they are of particular interest to teachers and young people. In relation to the environment and heritage budget, I endorse the appropriations and I ask for discretionary consideration of the two areas to which I have drawn notice.17:57:003975Andren, Peter, MPMr ANDRENKL6CalareIND00—In rising to speak on Appropriation Bill (No. 1) 2002-03 I wish to make a few comments about the remarks of my colleague the member for Kennedy. They serve only to underline the fact that we have massive competing interests in our farming environment. We should move away as much as possible from concentrating solely on economic sustainability. As the Parliamentary Secretary to the Minister for the Environment and Heritage, who is at the table, is suggesting, ecological sustainability is our aim in this century, having given the economic part of the equation a pretty free rein over the last 150 years or so. The parliamentary secretary and I were members of the regional affairs committee of the 38th Parliament, and our very first inquiry was into the fishing industry. From memory, the report was called Managing Commonwealth fisheries: the last frontier. We realised that there are many unknowns about our seas and our coastal waters. One of those unknowns was tragically found out with the orange roughy incident: we have very little handle on the mass of fishing stocks. But we found out that there is a hell of a lot of water between the fish around Australia, that one of the big problems is that it is heavily fished and that we need to bring the process under control. While that is occurring, we also have to act urgently to bring under control factors that are exacerbating that problem and causing massive problems to our coastal lakes. We saw a report released in the last couple days on the New South Wales lakes system. I, as a property owner on the South Coast, put in a submission about a local lake, and the reading of that report is quite frightening.We have but one lake on the east coast of New South Wales that could be vaguely described as anywhere near pristine condition, and that is right down at Nadgee in the national park on the Victorian border. The others vary from the possibly reclaimable to those where it is a matter of making do with the degradation that has been caused and trying to find a way to sustain some sort of balance between residential development, recreational use and the environmental qualities that we would want to maintain in those particular watercourses. While it is important to protect the agricultural production and income of our nation, it is incumbent upon us to be as unblinkered as possible about the consequences of the wash of soil and so on into our water—including the Great Barrier Reef and coastal waters—that so degrades the environment of the future. And that is our kids' future.The government's environmental commitment to date has been premised to a large degree on the sale of our greatest asset, Telstra. While I welcome initiatives in this budget such as the grants incentive for farm management plans, farmers realise that such programs are delivered at a cost, and that cost is a gradual loss of control of their remaining publicly owned telco with all of the concerns that they have about the situation 30, 40 or 50 years down the track. They are concerned not only about the environmental consequences but also about the communication consequences of not having a strong regime of control in a country which is so diverse and so widely spread as inland Australia. We are unique in this country—as I will mention in our debate on the communications portfolio—because we do not have the spread of population and we cannot create the critical mass in the market that will bring competition into our telecommunications market. It is an absolute nonsense. The Optuses of this world said, `We will deliver mobile services to 90 per cent of the market if you switch off analog'. They did, but that 90 per cent is some 15 to 20 per cent of the geography of the country. That is the essential issue at stake in this whole telecommunications debate and the rush to sell it off and create the Natural Heritage Trust. (Extension of time granted) I would have hoped to have almost completed by now, but the member for Kennedy inspired me in his delivery to preface my remarks somewhat. There was much fanfare with and political capital was made of the setting up of the first $1 billion Natural Heritage Trust. I said in my 1997 budget reply speech that there are simply not enough funds in the trust to tackle the enormous task of the Murray-Darling Basin salinity and degradation, let alone the other environmental challenges around this nation. This year, as in several years recently, the word `environment' sadly did not appear in the Treasurer's budget speech, which is a disappointing indication of at least Treasury's priorities. While a $1 billion extension to the trust has been announced, the actual allocation to the trust for the next year appears to be down by 10 per cent on last year. It is true that the National Action Plan on Salinity and Water Quality commences with a $100 million allocation, but the Renewable Energy Commercialisation Program, the renewable energy showcase program and other programs have been cut.Regarding the salinity program, it is good to see the states sign up to this initiative, but the extent of this enormous environmental challenge is not being reflected in hard dollars at the moment. The projected spending on the problem for 2001-02 was $65 million, and $30 million was spent. Earlier the parliamentary secretary explained the drought and other factors that prevent these programs, but I really wonder about that, when we are $35 million short, according to the figures, in one year. For 2003 it was projected to be $150 million and I believe we are now saying we are going to spend only $100.7 million. Is that because of the impending drought? Also, the actual proposed spending for 2003-04 and 2004-05 reduces by $50 million and $13 million. That is almost $150 million less than projected a year ago. The member for Wills detailed the substantial underspending, as he called it, and I wonder if we are transposing the salinity program into that. That means that we are committing only $500 million to our salinity program, when we have announced a $700 million program. I would like some explanation around those figures. Let us hope that this $100 million a year for the salinity program is real money and not virtual money, and not the shifting of expenditure from one program to another and the less than promised spending from the trust that we have seen in past years.The head of the Cooperative Research Centre for Plant Based Management of Dryland Salinity, Phil Cocks, says that we should be working at changing farming practices. That is basic to the sort of argument that I think the member for Kennedy was putting up. The income from the sugar industry is immense, but we have to look at the bottom line of the cost of producing all of our farm produce. Existing plans and moneys, including the river catchment initiatives, are largely targeted at rehabilitating effective land. Cocks suggests that we need to look at a more carefully based program on farming practices. For starters, surely that means a halt to indiscriminate clearing and studies into better use of the irrigation water that we have, rather than seeking ways to harness more water and turn rivers inland. The salt is lurking just below the surface. It was there untouched when we first came here—it was just below the surface. Unless we find a means of reducing the water required to produce crops, no amount of salinity spending is going to reverse the inevitable result that we are going to have vast areas in an unfarmable and irrecoverable condition.I would like the minister's comment on the environmental levy suggestion. If we are talking about a Medicare levy for our health then we should be talking about one for the health of our country. It is something that was suggested by a committee of the last parliament, chaired by the honourable member for Page, if I recall correctly. We are going to have to look at compensating landowners for loss of productivity due to locking up salt-affected land or reducing water rights. The member for New England has comprehensively covered that issue. It is a problem to be shared by all Australians and all should contribute. (Extension of time granted)A farmer in my electorate told me that it is hard to be green when you are in the red. As much as the farmers are committed to recovering those salt-affected areas, we must help them through compensation for land they have to lock up and we must also protect their rights where irrigation water is concerned. We must not only look at sustainable agriculture but also ensure that it is absolutely ecologically sustainable. That would mean not only land use repair but also land use reforms. The majority of farmers realise the problem. They want to manage the reform process. They need far more help than current policies and funding provide, notwithstanding the salinity action plan.I would be interested in the parliamentary secretary's comments on just how these issues—salinity action, compensation, land restoration, bushcare and alternative energy—are going to be funded over the long term when the perhaps questionable sum of $60 billion over 30 years has been put on that job by the NFF and the Conservation Council. Even if we had five Telstras we could not do the job by selling them. 18:09:003978Stone, Dr Sharman, MPDr STONEEM6MurrayLPParliamentary Secretary to the Minister for the Environment and Heritage10—The member for Calare makes a number of very accurate observations about the state of the environment in Australia, the need for sustainability and the fact that sustainability will take a very long time. I agree with him—I do not think that anyone in Australia underestimates the investment that is needed to better protect our water and air quality and address the loss of soil fertility and the loss of biodiversity. This government has invested the biggest amount of funds specifically directed to the environment of any government that Australia has seen. With the combination of the Natural Heritage Trust and the National Action Plan for Salinity and Water Quality, the fund is well over $2 billion, but of course it is the beginning—it is unfinished business—and generations will have to continue to invest.You are worried about underspend. I think you said that you heard my comments in response to the shadow spokesperson for the environment, but just let me repeat them for your particular sake: the funds for the Natural Heritage Trust—the underspend that you identified from the end of NHT mark 1—have not been lost. They are retained in a special account and will be spent on the purposes that were originally set out in the trust legislation. But, for the reasons I mentioned before, you cannot dictate to a community group or a natural resource based program the actual expenditure that they commit to, because of a whole range of seasonal allocations, the fact that it might have taken longer than we had hoped for the state to agree to that particular project and even the fact that in some instances the passing on of cheques might take longer than we would have liked because of coordination or hold-ups. Let me assure you that, in fact, the underspends in the first years of the trust, while they are quite understandable, are not lost to the future of environmental projects in this country. In terms of the national salinity action plan, there is certainly no intention whatsoever to reduce funding for the NAP, a new program, and that is $700 million from the Commonwealth over seven years. We expect similar amounts from the state governments and that negotiation is still going on with the state governments in some instances.In terms of the Australian Greenhouse Office underspending on its programs, we did touch on this before and, as I said before, no payments are made up front. It has again been a case of the milestones sometimes not being achieved when those programs were expected to have delivered. But the reduction in estimates shown in the budget papers relating to greenhouse funding shows that the capacity of industry and governments to take up large funding amounts provided in short time frames is a serious problem. We have got to do better with that. The approval of projects involves payments based on achievement milestones that are scheduled to be achieved over three- to six-year periods, and you get that slippage. There has been no cut to the $400 million for the Greenhouse Gas Abatement Program, and I can give you specific details of funding for the other programs you mentioned. Let me assure you that it is often easy to decry the volume of spending and the outputs of a program, but we are talking about natural resource issues, we are often talking about new technology and we are often talking about grants to business sector or voluntary groups who have never before engaged with government in doing this sort of work.KL6Andren, Peter, MPMr Andren—The levy?EM6Stone, Dr Sharman, MPDr STONE—As for the environmental levy that you spoke of, it is interesting that we have in the House today a significant group of non-government organisations who have come from around Australia to talk about environmental issues with the minister, me and Environment Australia officers. They have raised the issue of an environmental levy—very much, of course, directed towards natural resource expenditure. They refer to it as something like a Medicare levy in the way it might be structured. The minister, of course, is listening very carefully to all of those inputs from the non-government organisations who work in the environmental area. Of course, it has been raised before by our own Commonwealth committee, and it is amongst a whole raft of issues for future funding that we will need to look at, including taxation measures, more business and philanthropic joint ventures and commitments in the future. So you will not be surprised to know that that issue was very much on the agenda today.18:14:003979Windsor, Antony, MPMr WINDSOR009LPNew EnglandIND00—Just to follow up on the remarks made by the Parliamentary Secretary to the Minister for the Environment and Heritage, I am very pleased to hear that the concept of an environmental levy, as was raised by the member for Calare and previously by the parliamentary committee, has been discussed and is being discussed within the walls of this parliamentary building. Obviously, coming from a country electorate, I have been able, as many others in this room would have been, to observe changes in attitude over the last 10 to 15 years in those involved in agriculture. I have been involved in a number of those areas myself.One of the things that I think is becoming very prominent in the thinking of people in country areas is that they are agreeing with some of the scientific indicators of environmental health or degradation that are being indicated by a number of agencies, both state and federal. But there is an inherent degree of mistrust in some of the agencies, particularly by the farming community, with regard to the expectation that the farming community—the land-holders—will have to wear the cost of change. Obviously, with the cash flows and the world market arrangements as they are, that is becoming increasingly difficult. As a consequence, from time to time there is a sort of boil-up of animosity. I would say that in most cases it is not animosity in relation to the particular issue that is recognised as a problem; it is animosity in relation to the solution to it. I for one ran very strongly, in a fairly conservative country electorate, on the issue of an environmental levy. I am not saying that is the only reason that I was elected— 00AMRKing, Catherine, MPMs King—It was charm.009LPWindsor, Antony, MPMr WINDSOR—Yes, charm obviously came into it. I think it indicates that an environmental levy is something that country people would consider being part of. I know I am oversimplifying it, but I made the point during the election campaign that $1 a week from all Australians raises $1 billion a year. If we are ever going to get serious about addressing some of these degradation problems and remedial problems, that is the magnitude of the money that we have to spend. The $100 million for the National Action Plan for Salinity and Water Quality is great—we have all made political capital out of that—but it is 10c a week; it is absolutely pathetic in relation to the problems. If we are talking about $30 billion to $60 billion over the next 60 years to remediate some of the Murray-Darling system and other systems, particularly in relation to salinity and other ground water and above-ground issues, that is the sort of money that we have to start generating—$1 billion to $2 billion a year; not a paltry amount.As the member for Calare indicated, we are short-changing ourselves already in terms of the allocation. I think that says something about the sincerity of governments generally. I am not picking on this one, but I think we tend to talk about the environment from time to time without actually doing something about it. If we live in the city, we just assume that the country people will take care of it because they live there, and if it means that they go broke, who cares; at least the environment is saved. That is a very stupid argument as well because the reverse actually happens. If you have ever spent any time in Africa and watched the progression of the Sahara Desert, it is partly because they cut down the trees to warm themselves and cook food. Economic imperatives will always override environmental imperatives when humans are put under stress. I think that is just a fact of life—a regrettable one maybe, but a fact. I do not think any parliament has actually come to grips with that.I support the parliamentary secretary and others in this place who are moving towards considering an environmental levy. We did some market research when I was a member of the state parliament in Sydney on the acceptability by urban people of an environmental levy. There was virtually 100 per cent acceptance, with a couple of provisos. They were very important provisos, in relation to country people in particular, including that the levy be transparent, not like the sort of adhockery and politicisation of the Natural Heritage Trust—and not, I hope, like the money for the National Action Plan for Salinity and Water Quality. It has to be transparent and there may well have to be some regulations tied to the distribution of that money, and that is fair enough; people will accept that. The farming community particularly will accept that if it is explained to them clearly. (Extension of time granted) Country people will accept that if it is explained to them and if there are certain provisos. They may include, in some cases, the fencing off of some streams, the removal of some particularly important pieces of land or saline areas or recharge areas—those sorts of things. People will accept that.The problem at the moment is that we have this rush of science, and those who are the custodians of the land do not have the capacity to deal with it. That is why I spent some time earlier talking to the Minister for Agriculture, Fisheries and Forestry about the property rights argument, the compensation arguments. If we are going to make changes—and I believe we have to—in some of these areas, we have to lead with the dollar. We cannot expect those who are going to suffer significant financial and family related impacts to just move on and move off. Obviously they are going to politicise the arguments; they are going to react as, from time to time, they do now. There is a classic case in the Namoi ground water issue with which I have been involved. All the farming community know there has to be change. It is coping with that impact and the lovely greetings they have from their bank managers that is the problem. It is not the change; it is not the science. That is not the problem; it is the coping that is the problem.I will move on to a couple of other issues. I would encourage the government to look very closely at the biofuels area. There are a number of real benefits there not only in terms of the environment but also in terms of the relationship that growing fuel on agricultural lands could have. I think the parliamentary secretary is fully aware of that. I have some concerns with the national action plan. I notice that it is a sort of a coarrangement with two departments—the Department of Agriculture, Fisheries and Forestry and the Department of the Environment and Heritage. I do not have a problem with that but I hope it does not become a problem. I also notice that similar issues could arise from the implementation of the Environment Protection and Biodiversity Conservation Act. I would suggest that the parliamentary secretary cover it in her final comments. Have the government looked at the impacts on various individuals of endangered fauna, flora and a whole range of other things that may have to be removed through some regulatory regime? Have they looked at the property rights compensation issues for those who are going to be impacted on? Has the Minister for the Environment and Heritage, for instance, looked at the regional catchment blueprints under the national action plan and suggested that property rights implications be built into the draft documents? I do not think that has happened but, as I explained earlier, we have a sort of circular argument between the Deputy Prime Minister, the Prime Minister and the minister for agriculture. God knows where the minister for the environment is on this. We could have a situation in which property rights are to be covered through catchment blueprints but the blueprints have nothing in them about property rights. In the Deputy Prime Minister's language, that could be to the detriment of the flow of money into those particular areas.I would suggest to the parliamentary secretary that we have a very good look at how compensation can be dealt out, as the member for Calare indicated, where there has to be positive environmental change. Instead of seeing the farming community as an enemy to environmental change—and those members of parliament who have gone out there and looked at the way in which a lot of the farming community are embracing some of the changes that need to take place will agree with what I am going to say—let us accept that they are ready to move and have moved quite considerably in the last decade. But it is impossible to make some of the changes that some of our governments require, through political pressure, in a low population country such as ours. It is impossible to do that at the rate that is required for the environment, because their cheque books cannot wear that rate of change. So let us put the issue to the people. A dollar a week raises a billion dollars a year. Let us get away from the 10c that we are prepared to spend now and start to talk real dollars. Involve the total community so that, when there has to be change, it is fully recognised by everybody that everybody makes a contribution to it. Put some regulations on it and put some transparency on it, but let us do it.18:24:003981Stone, Dr Sharman, MPDr STONEEM6MurrayLPParliamentary Secretary to the Minister for the Environment and Heritage10—I thank the member for New England for his contribution. He raised a number of very significant points in relation to Australia's sustainability. One of them was the use of biofuels, and certainly in Australia we have to look to alternatives to our fossil fuel dependency. There is a win-win situation potentially if we start to use oils like canola oil or even abattoir waste and certainly sugar and convert those to highly effective fuels. There is a $5 million two-year major study now being undertaken to address market barriers to the adoption of biofuels, particularly in relation to transport, that the environment minister and Minister Warren Truss announced very recently. That is a very significant study which is expected to take several years to do all the work, but I invite the member for New England to participate in that study, to make submissions, and to make sure others know about that work. Through the Australian Greenhouse Office, we have a number of programs that have been looking at alternative fuels and incentives to have more research and work done. There have also been some very good joint ventures with Ventura Bus Lines and CSR in working through some of these alternatives like the ethanol based fuels. The member for New England mentioned property rights and they, of course, are critical to an outcome that means we have rural communities who in themselves can be sustainable. When we say `sustainable', we mean there has to be a natural resource base that is in a good condition but the communities also have to be viable. We are looking at a whole range of different ways to manage landscape in Australia. One of those is environmental services. For example, in the future, if a farmer produces his traditional crops, it may be acknowledged that by retaining some vegetation on his property or having wetlands in a good condition is in itself of great value and is for the greater good of the public sector. There may be a tender process, like the Bushcare tender we have piloted in the north-east of Victoria where, instead of the grower or the primary producer being seen to have lost independence of action on his property because he may no longer be advised to crop that country, he can be reimbursed for delivering environmental services to a region by those alternative activities. I know that there has been a lot of interest from various regions in Australia in looking at those sorts of alternative ways to use landscape. We, of course, are also very conscious quite specifically of the water property rights issue now, which is very alive in the member for New England's country. There are two major undertakings as part of the COAG water reform framework in terms of water property rights, which Minister Truss referred to before. State government members of COAG are required to implement systems of water allocations, or entitlements backed by separation of water property rights from land title, and a clear specification of entitlement in terms of ownership, volume, reliability, transferability and, if appropriate, quality. That work is expected to be done by September of this year—we may need to know more about how the states are going to move on those actions. But related to that is, if you forgo property rights to water, how will the states and the Commonwealth consider adjustment for those farmers in terms of a new property regime or, indeed, compensation? Those issues are very alive. But it is not a simple matter, as all the members in this chamber will be only too aware. For example, the use of water may not have been based on a statutory right; it might have been a customary use of that water. There may be sleeper licences or entitlements which are there. Do we claw back sleeper entitlements and licences and, therefore, base new entitlements on historic use or do we look at who has rights and whether or not they have been used? There are a range of complexities and they are exercising the minds of all states now. It is not an issue that has been forgotten or swept under the carpet, but it is one where we recognise that if you remove any statutory property right—and it would be like removing a fishing licence that is of great value, that is tradeable—then you must be serious about adjustment for that individual. (Time expired)18:29:003982Hunt, Gregory, MPMr HUNT00AMVFlindersLP10—In supporting the government's budgetary measures in relation to the environment I wish to point to two specific threats to the government's biodiversity objectives. The first is in relation to the Mornington Peninsula and Westernport Biosphere Reserve, which Environment Australia recently gave its approval and support for. I believe there is a significant threat to the future of this reserve from actions taken at the state level.The concept behind the reserve is that the United Nations Educational, Scientific and Cultural Organisation, UNESCO, endorse around the world a series of areas known as biodiversity spheres or reserves. They have, however, never previously endorsed a reserve as an urban biosphere. Through a process initiated by the community with the support of the local councils of the Mornington Peninsula—Frankston, Cardinia, Casey and Bass Coast—the Mornington Peninsula and Westernport area has put forward a proposal, to which UNESCO have indicated their initial acceptance, to create the world's first urban biosphere reserve. That process has been continuing for some years now and has reached the point where UNESCO are ready to consider and make for the first time a formal declaration. The Commonwealth recently gave its approval as part of its overall package of not just budgetary but portfolio measures for conserving biodiversity. The state government has now been asked to similarly endorse those sets of proposals. However, nothing has occurred on that front, and as the deadline approaches this Commonwealth support faces being abandoned by the state government.I have here a letter I have been given by the Biosphere Advisory Committee. The letter is from the committee to the Victorian Minister for the Environment and Conservation, expressing their deep concern that this proposal, which has Commonwealth support and is an important part of the Commonwealth's biodiversity objectives, is under threat. In writing to the minister, the Biosphere Advisory Committee note:We have been advised very recently that, as a result of the need for more consultation and time for responses from the remaining government agencies, the IDEC paper may be delayed for another month or more.We find this situation unsatisfactory and frustrating.They go on to say that the general position of the state government has been unhelpful, slow and bureaucratic and that the capacity to achieve this first biosphere urban reserve anywhere in the world has been placed under threat. I call upon the state government to work with the Commonwealth and with the local community, both of which have given support to the biosphere proposal and both of which are concerned with achieving national biodiversity objectives, to help create this urban biosphere that would be an outstanding achievement for the Mornington Peninsula and for Westernport.The second threat to the Commonwealth biodiversity objectives, which I wish to raise very briefly, is a very local issue. On Phillip Island there are fewer than 100 koalas, yet these are a critical part of both the environment and the local tourism industry. The entire community is at threat from a plan by the state government department in Victoria, VicRoads, to remove 157 trees, which are at the heart of where these animals live, from the road verge of Phillip Island Tourist Road between Back Beach Road and Rhyll and Ventnor Roads. There is very strong evidence that the koala community and therefore the government's biodiversity objectives are likely to be placed under threat.I call for action from the Victorian state government to ensure that the biosphere reserve gets approval as soon as possible so that the international community can recognise the Mornington Peninsula and Westernport for its biodiversity. Secondly, I call upon the state government to take action immediately to end this ridiculous plan which places at risk one of the signature elements of nature and conservation not just on Phillip Island but within Victoria and Australia more generally.18:34:003984Stone, Dr Sharman, MPDr STONEEM6MurrayLPParliamentary Secretary to the Minister for the Environment and Heritage10—I too am concerned that the Victorian government is not as supportive of the biosphere proposal for the Mornington Peninsula because, as we all know, that is an area under a great deal of stress through suburban development and tourism numbers, especially in the summer periods. It has unique biodiversity but it is all very vulnerable and it would obviously be a very important contribution to the understanding of biodiversity in Australia. So the Commonwealth continue to support those biosphere intentions and we hope the Bracks government sees itself clear to be able to take that particular initiative more seriously in the future. We have had a lot of ability to support the koalas through Green Corps, and our Bushcare initiatives have looked at endangered species. But unfortunately, at the end of the day, we have to have the cooperation of VicRoads and others, and it is an example of where we need very close state and Commonwealth cooperation in all things.Proposed expenditure agreed to.Department of Health and AgeingProposed expenditure, $3,019,484,000.18:36:003984Evans, Martyn, MPMr MARTYN EVANSN36BonythonALP00—I wish to raise a matter on behalf of some individuals in my district, but I think it actually applies to a broader range of people, because it affects anyone who was a member of a friendly society prior to the early 1960s when the law was first changed in this matter. Those people who at that time were members of relevant friendly societies—in this case, National Pharmacies of South Australia; but it applied more broadly than that—and who joined their pharmaceutical prescription scheme were able to enjoy a concession of some additional 70c on the price of prescriptions dispensed by that pharmacy through their friendly society scheme.That is fine: those people paid their subscription fees and remained members of that scheme, in this case for some 40 years. But now they find they are disadvantaged. Indeed, they feel discriminated against because, whereas other concession card holders are required to accumulate 52 prescriptions in a year before they are eligible for concessional rates of pharmaceutical benefits, in this case—because the people concerned are paying a lower price for the prescription—they are required to accumulate perhaps 60 prescriptions in a year in order to achieve the same dollar value as other pensioners. They are only receiving the cheaper rate because of the fact that they have been members of these schemes for many decades and because they have contributed a fee, an insurance premium, to the friendly society to belong to those schemes.The government's decision in this matter is one which, in the view of the people concerned, unreasonably discriminates against those friendly society members. In effect they are paying the additional amounts because their subscription rates to the insurance scheme—the pharmaceutical benefits subscription scheme—are not counted for the accumulation of the safety net threshold, but the fact that they pay a lower amount for the prescription is counted against them. In that respect, they certainly have a case for further consideration of how the Pharmaceutical Benefits Scheme impacts on their particular subscription scheme.I certainly would appreciate the minister being able to comment perhaps on the way in which the scheme operates in relation to these people because of the fact that they have contributed their subscription fee to the pharmaceutical benefits fund over all of that period of time—some 40-plus years. Not to have that additional contribution now taken into account for assessing their safety net threshold limits is, I think, somewhat unfair. One figure counts against them but the other figure does not count in their favour. Because their colleagues in this area are able to gain the benefit after 52 prescriptions, they feel that that same outcome should be extended to them. I would certainly appreciate the minister's consideration of that and any relevant comment that he may be able to make this evening.18:40:003985Baldwin, Robert, MPMr BALDWINLL6PatersonLP10—I am glad that the Minister for Ageing is in the chamber, so I will take this opportunity to raise a number of points in the areas of both health and ageing on behalf of my electorate of Paterson. Firstly, I congratulate the Myall Lodge Hostel aged care facility in Tea Gardens on its 10th anniversary. Minister, there are a number of staff and volunteers who do a remarkable job at the centre, and I would particularly like to congratulate the administrator, Frank Caulfield; the president, John Sharp; the secretary, Ted Cohen; and, of course, Lorraine Davenport, the supervisor. This 10-bed facility currently has plans for a 20-bed extension to meet the growing needs of the Tea Gardens and Hawks Nest area. The development will be assisted by a grant of $325,000 from the Department of Health and Ageing and a grant of $175,000 from the Department of Veterans' Affairs. I also send my congratulations to the Harbourside Haven Nursing Home, where earlier this month a 22-bed extension and restructured rooms were opened by the Minister for Veterans' Affairs, the Hon. Danna Vale. Minister, I ask you to keep in mind that almost one-third of all residents of Harbourside Haven are veterans or war widows. It is pleasing to see that the needs of our veterans and their families are being addressed, as we all owe them a debt of gratitude for their service and sacrifice.In the 2001 aged care approval rounds that were announced in January, Paterson was given a total of 152 new aged care places, worth more than $2.9 million. The successful applicants were: Baptist Community Services in Forster, which received five housing linked care packages; a new service called Darvelan in Forster, which received 40 high care places and 60 low care places; the Forster-Tuncurry Nursing Home in Tuncurry, which received 15 low care places; Dungog and District Retirement Living Inc., which received 12 low care places; and, as I said before, the Myall Lodge Hostel, which received 20 low care places. The announcement was a step in the right direction for aged care in regional areas in bringing more services and places into areas outside the major cities. Following that announcement in January, I visited the nursing homes in my electorate to see first-hand what our local needs are and to discuss with the centre managers where we need to go in the future. There are three specific cases in Paterson of nursing homes that require capital funding in future aged care approval rounds: the Great Lakes Nursing Home in Bulahdelah, Dungog and District Retirement Living Inc. and Gloucester Nursing Home, based at Gloucester Hospital. Without these facilities, residents of these three towns would have to move or travel considerable distances to receive aged care services. In April, I wrote to the aged care planning advisory committee in New South Wales, recommending that, in future aged care approval rounds, consideration is given to the capital funding needs of these facilities. I would like to reiterate that message here today.Minister, clearly understand that, in order to keep up with the accreditation standards and to provide aged care services to regional towns, we need to see capital funding go into these centres. Minister, as you go through this year, issuing places and making commitments to the community—and you have done a good job so far—I urge you to take the needs of the people of Paterson into consideration. I urge you to address the need for capital grants in these areas, as well as the further needs for aged care beds in the seat of Paterson. We have one of the highest aged care dependency needs in Australia, and I think you should undertake a study—indeed, come to my electorate to see these facilities—and determine what is needed, and then address those issues on behalf of my constituents.18:44:003986Andrews, Kevin, MPMr ANDREWSHK5MenziesLPMinister for Ageing10—I would like to reply firstly to the honourable member for Bonython. As I am advised, the situation in relation to the safety net so far as prescriptions are concerned is that the safety net is a dollar amount calculated on the basis of 52 by $3.60 which gives an amount of $187.20. Therefore, as I understood it from the honourable member's comments, if his constituent was in receipt of prescriptions at a lower value than the $3.60—$2.80, as I understand it—obviously it would take more prescriptions at $2.80 than it would at $3.60 to reach that threshold amount. But it is the amount which is the threshold, I am advised.In reply to the honourable member for Paterson, he will be aware that there will be an amount of approximately $35 million available for capital grants for nursing homes and hostels in the 2002-03 financial year. I am sure that with his good efforts there will be substantial detailed and, from his perspective, hopefully, persuasive submissions coming forward as to why some of the money should go to the electorate of Paterson. Finally, I say to him that I would be delighted to visit his electorate and meet with aged care providers and visit his homes at some appropriate occasion.18:46:003986Baldwin, Robert, MPMr BALDWINLL6PatersonLP10—On another issue involving health, I take this opportunity to discuss the health needs of residents in the Forster-Tuncurry region. The Cape Hawk Hospital in Forster is community owned and operates as a private facility. It is, however, the only available hospital in town. Residents without private cover must travel to the nearest public hospital in Taree, the Manning Base Hospital. There is a desperate and urgent need to establish an after-hours care service similar to the one currently operated in Maitland by the Hunter Division of Urban Practice and the team behind Dr Arn Sprogis. I inform the Minister for Ageing that I am proud to have helped drive the Maitland service, which was set up as a trial in 1998 and which has become such a success that it is still running today. More importantly, it has become the model for others around the country. It has also highlighted that there is not a single method of providing this service that can be uniformly applied to all towns. The Forster-Tuncurry community needs services that are tailored to meet the needs of this specific community. This is particularly important given the growth rate of the area, which is attracting not only more retirees but also younger families through the development going on in that town. I would also like to talk about the frustration that residents in the town of Karuah are feeling at the failure to acquire a local GP. Following the sad death of the doctor in Karuah over the 2001 Christmas break, efforts have been made from my office, the Karuah pharmacy and the local community to find a replacement doctor. I would like to thank the minister and the office for their assistance in securing an overseas service provider number for the town earlier this year, and also two overseas trained provider numbers for the Medowie community. I need to report back that, in the case of the Medowie community, Port Stephens Medical Centre has now expanded into that town, bringing more doctor services. Unfortunately, while there have been some bites for the Karuah position, a full-time doctor willing to set up a practice in the town has not yet been found. I have taken this matter to the Port Stephens Council to see if they can assist in any way in the process but the council has not been forthcoming in helping with the Karuah situation, due only to a lack of resources and dollars. While it is disappointing that a doctor has not yet been found for Karuah, I will continue to push the issue and help any interested doctors in any way I can. Council has agreed, however, to push the state government to set up a polyclinic in Medowie. I also bring to the minister's attention the statements by Bob Carr and Andrew Refshauge in the lead-up to the 1995 state elections in New South Wales, and those comments were to the effect that if they did not reduce the waiting lists in New South Wales in the first 12 months they would resign. That message was heard loud and clear by the people in the Paterson area. It was heard and believed, and they voted in support of the Labor Party. But, guess what? Seven years down the track the waiting lists have blown out, and that has had a serious effect on my constituents. What is even more alarming is that this blow-out has hit maximum levels in regional areas. Whilst they have made some feeble attempts in the cities they have ignored, to a large extent, the people in the regional areas.I call on the minister to bring Bob Carr and his cabinet to account for their lack of spending in regional areas in New South Wales, particularly in the Port Stephens area, to bring doctors there so that in the Forster-Tuncurry region we could establish a polyclinic. They have even refused to negotiate with the community owned Cape Hawk Hospital to lease private beds. They have refused to provide any support whatsoever. Why? Because quite simply they are a citycentric government. Minister, I pay you due credit: you have looked beyond the cities and you have looked at providing support in regional areas, but I say to you clearly, while that is nice we need more, but we also need you to bring Bob Carr to account.18:51:003987Andrews, Kevin, MPMr ANDREWSHK5MenziesLPMinister for Ageing10—I thank the honourable member for Paterson for his remarks and indicate to him that from the Commonwealth government's perspective it is important that state governments right around Australia meet their commitments to provide hospital and medical services which are primarily, particularly in terms of hospital services, the responsibility of state governments. I can say to him that the coalition is committed to Australians having access to quality health care. As he might know, through the regional health strategy, the coalition has increased the number of doctors practising in rural and regional Australia. Since 1999, when the general practice memorandum of understanding was signed, which includes the Division of General Practice, the Royal Australian College of GPs and the Rural Doctors Association, the Medicare rebate for standard consultation has increased by over 14 per cent and by over 20 per cent for longer consultations. The 2001 budget, as he might recall, contained a $750 million boost to Medicare to allow doctors to offer better care for patients affected by asthma, diabetes, mental illness and cervical cancer and to allow rural GPs to employ more clinical nurses. This funding also included a specific amount of $300 million to fund longer GP consultations under Medicare.The government has also allocated a further $236 million over four years for the Practice Incentives Program. This program should encourage doctors to continue to bulk-bill their clients. There has been a substantial increase in the number of GPs practising in rural and remote Australia. The number of GPs billing Medicare from these areas has increased by over 11 per cent since 1997 from 5,706 to 6,363 by the year 2000. This is a matter which the coalition will remain concerned about and we will make whatever efforts are necessary to ensure that our commitment to rural Australia and that of the state governments remains.18:53:003988Cox, David, MPMr COX83UKingstonALP00—I want to talk about an issue relating to the availability of appropriate prophylaxis for haemophiliacs—that is, the availability of Recombinant Factor VIII. I have a constituent in my electorate who has three sons who are haemophiliacs. The two oldest sons have got hepatitis C as a result of having to rely in their earlier years on Plasma Factor VIII for their prophylaxis. The third son has always had available to him Recombinant Factor VIII and has no blood diseases as a result. The second son has been on a program of Interferon and Ribavirin for some time and has in fact changed his hepatitis C status from hepatitis C positive to hepatitis C negative, which is wonderful. The current criterion, as we understand it, is that had he never had a blood-borne disease he would have Recombinant Factor VIII available to him. What I want to find out is, if he has moved his hepatitis C status to hepatitis C negative, would it be possible to have made available to him Recombinant Factor VIII so that he is not exposed to future risks of new blood-borne diseases?The other issue that I want to raise is the commercial arrangements between the government and CSL for the provision of Factor VIII. Recombinant Factor VIII is an expensive product and it has been in very short supply, hence these quite logical rules to make sure that it is used where it will have the most benefit. I would like some kind of an update as to what is happening with the relative cost factors of plasma Factor VIII and recombinant Factor VIII and whether, in fact, we are getting to a situation where recombinant Factor VIII might be more generally available. Is there anything in the commercial arrangements which is encouraging CSL for commercial reasons to want to encourage the continued use of plasma Factor VIII when recombinant Factor VIII might in fact now be an affordable product?I am also interested to know where the situation is at with regard to people who have bleeding disorders when they are likely to be having surgery and may need some kind of prophylaxis as part of that intervention—for example, a patient with thrombocytopenia who has a need for an urgent medical procedure and has not been able to store their own blood in case anything goes wrong during the operation. Is that patient being forced to rely on plasma Factor VIII in those surgical procedures, with the attendant risk of their contracting some as yet unknown blood-borne disease or would it be possible to make generally available recombinant Factor VIII to mitigate that risk? 18:57:003988Andrews, Kevin, MPMr ANDREWSHK5MenziesLPMinister for Ageing10—I understand the nature of the questions that the honourable member for Kingston is asking. I should indicate to him that I do not have the answers here and now but I undertake to provide him with the answers in due course.18:57:003988Jenkins, Harry, MPMr JENKINSHH4ScullinALP00—I take this opportunity to make some general observations about the changes that were proposed by this year's budget to the PBS and to raise at a later stage some more specific issues. I think that one of the real problems about the changes that were proposed by the budget to the Pharmaceutical Benefits Scheme is that they have been done in isolation outside of a proper look at the way in which the PBS operates within the whole health care system. To increase the cost of drugs by 28 per cent—especially in the instance of concessional patients, but also for general patients—is a large impost. The fact that it comes out in a budget rather clouds proper discussion of the issues. Perhaps it is time to review the way in which the PBS has operated.Nobody would question that the PBS has been very successful in meeting the aims that were set for the PBS well over 50 years ago when it first started. It does ensure that there is universal access to drugs at a proper price for the Australian population. Now, as we see the government tinkering with the way in which the copayments relate to the overall cost, it is perhaps time to revisit a number of the factors that impinge upon the PBS. Of course, one of the things that has been said in the budget papers is that the increase of 28 per cent in the copayment `will restore to previous levels the balance between the contribution to the cost of drugs by consumers and the government'.One could logically take from that statement that that will continue to be the case and that we will see increases in the copayment that go well beyond indexation, if in fact one of the problems is that higher cost drugs are coming on to the PBS. But I think we have to look at what is going to be the outcome of those increased costs—what will change in the way people perceive their ability to access these drugs, the way they see their ability to afford them and the way they will make decisions about whether they actually have their prescriptions dispensed.As has been stated on behalf of the opposition, we have no problems with a number of the items in the budget that go to trying to effect change on things that place pressure on the PBS. But many of these things are not new. If one looks at the budget documents, one has to ask what is now going to be the magic solution to a number of these things. For instance, when we talk about sitting down with the manufacturers of generic drugs and negotiating prices, and about a new computer system that will in some way make it even harder for doctors to not prescribe the lower cost drugs, we have been trying to do this for years.When I make some of these comments, I acknowledge that we have had governments from both sides of the chamber in charge of trying to combat a number of these pressures that are on the PBS. But, simply put, when we look at what is proposed here in the budget, in the isolation of just being budget measures, one has to ask why we do not have a total review of the way the PBS is operating, and not do it in isolation but look at the way it impacts upon other health costs. For instance, there is evidence from overseas studies that for every dollar that is spent on a PBS type scheme there can be savings of $3 to $4 in other aspects of health expenditure.People give the simplistic reply that there is no evidence on the macrocosts of the health system, but these are things that have to be acknowledged. We have to look at the way the new generation drugs are coming onto the scheme and make an assessment about how that will actually change the need for those drugs, because it will change people's quality of life. (Extension of time granted) I have mentioned the proposals in the budget about generic drug prescribing. There is an item in the budget entitled `Increased information provision to doctors by industry'. The opposition, at the time of the last election, indicated that we would want to have greater scrutiny of industry marketing and that we thought there should be tighter controls on direct advertising to consumers. I do not wish to make any sorts of definitive pronouncements about industry marketing, but certainly not only in the popular media but also amongst people who are more into analysing the PBS there are often concerns raised about the influence that the medical representatives employed by the pharmaceutical industry have over the prescribing habits of general practitioners.Over time there have been a number of suggestions. Some of these have been taken up, and the scheme which allows for independent representatives is something that is well worth expanding. At one stage it was known as academic detailing, where in fact government would be the source of the provision of information to medical practitioners, that you might move to cut out the fact that the industry were out promoting the new drugs. The pharmaceutical industry has a code of conduct about its behaviour. It has an internal jurisdiction about the way it assesses complaints. If in fact this is something that the government is concerned about—the opposition is certainly concerned about it—perhaps it is something we need to step back and have a look at. Perhaps there is a need to go beyond even what has been suggested by the government in the budget. The government says that this increased information provision to doctors by industry, which it estimates can be a saving of $147.1 million over four years, would be through the network of medical representatives employed by the industry. I have to say there is some concern about the behaviour of the industry in this regard, and perhaps it is now time to have a look at that. One specific measure that was mentioned in the budget is the provision of funding for a new medical service: photodynamic therapy with verteporfin—Visudyne—therapy, which is to do with the treatment of age related macular degeneration. The budget related papers state that there will be a special determination under the Health Insurance Act to ensure that those who might benefit will receive the therapy. I was approached by a constituent about this therapy before the budget. That constituent was very pleased that that item was contained within the budget, but in the weeks since the budget she has learned of this special determination. It has been indicated to her that perhaps she is unable to use it because of an age cut-off for use of the treatment. I am a little concerned and I require some clarification.I want to raise only in general terms something else which is more directly related to the minister's responsibilities, and that is the provision of aged care services. In the electorate of Scullin, as has been identified by the census, the second largest ethnic group is from Macedonia. Over time, we have been trying to get an ethno-specific service in residential aged care for the Macedonian community. It has a chequered history, but some very valid and good submissions have been brought forward. I raise this matter in the context that over time I would like to hear from the minister how he perceives the way in which we might best accommodate the special needs of different ethnic communities. In the electorate of Scullin the greatest developing need is within the Macedonian community.19:07:003990Andrews, Kevin, MPMr ANDREWSHK5MenziesLPMinister for Ageing10—I shall first address the final issue raised by the member for Scullin. In this year's allocation to Victoria, as he may be aware, in addition to the normal pool, 40 high-care places and 40 low-care places are allocated for people from a range of non-English-speaking backgrounds. The priority areas or ethnic groups in this instance include people from the Macedonian community. If the honourable member or representatives of the Macedonian community would like to meet with me to discuss these issues, I am most willing to ascertain a time to look at their case, as I have tried to do with some other ethnic communities in Victoria and elsewhere.The honourable member will be aware that the changes to the Pharmaceutical Benefits Scheme which have attracted the most attention—namely, the increase in the payment for concessional and general patients—are part of a number of changes that the government is introducing. Those changes, in the context of that package, are intended to bring about some of the results to which the honourable member alluded. That includes improving evidence based quality prescribing. We know that new medicines are included on the PBS on the basis of their clinical and cost-effectiveness and to ensure that medicines are prescribed effectively. The PBS includes rules on when and for what conditions some medicines are prescribed. This budget measure, which reinforces the commitment to evidence based medicine, includes a number of initiatives which will improve those rules and ensure that doctors prescribe in accordance with them. There are also provisions relating to the PBS listing process, the prescribing criteria, the prescriptions needing Health Insurance Commission approval and support for doctors in the community awareness program.Secondly, there is a provision to increase information provided to doctors by the industry. There is also a measure that addresses pharmacy fraud in relation to pharmaceutical prescriptions. There is another measure relating to decreasing doctor shopping. Finally, there is a measure for facilitating the use of generic medicines. I will not rehearse all the details about these. I simply say, in response to the honourable member for Scullin, that this measure is not just about the increase in payments sought by the government for both concessional and general persons; it is also about a raft of other measures in relation to the matter.The honourable member also spoke about reviewing the effectiveness of the PBS. I can indicate to him that the government has begun a review of the PBS program. The review is being conducted by senior officers from the departments of Health and Ageing; Prime Minister and Cabinet; Treasury; Finance; Industry, Tourism and Resources; and Veterans' Affairs—along with officers from the Health Insurance Commission. The committee is chaired by Dr Louise Morauta, the Acting Deputy Secretary of the Department of Health and Ageing. A report is expected some time later in the year for the Minister for Health and Ageing, which may address some of the issues that the honourable member has referred to.The other matter that the honourable member referred to was the Visudyne therapy for the treatment of macular degeneration. The funding arrangements involve payment of a health program grant to the manufacturer for the supply and distribution of the therapeutic agent associated with the therapy at no cost to the patient and for payment for the medical component of this service through the Medicare arrangements. The department is currently working with the manufacturer and the medical profession to ensure that, from 1 June this year, the treatment will be available to those patients most likely to benefit. If what I have said has not adequately addressed the honourable member's question, I will look into it further and we can perhaps provide him with some more details. HH4Jenkins, Harry, MPMr Jenkins—Mr Deputy Speaker, I thank the minister for that response.19:12:003991Griffin, Alan, MPMr GRIFFINVU5BruceALP00—I have a series of questions that relate to the Pharmaceutical Benefits Scheme matters that were raised in the House today but were not effectively answered by the Treasurer. I would like to raise those with the minister now. As a starting point, I note the comments that the Minister for Veterans' Affairs made about a review of the PBS. I would be interested in his comments as to why we are having a review following an announcement of a cut of over $1 billion to the scheme. It seems to me to be putting the cart before the horse. Certainly I am on the record as supporting the need for review of the Pharmaceutical Benefits Scheme, but it has to be done in the context of what is right in terms of health outcomes rather than the government trying to justify its budget cut.It was raised in the House today that Labor in government had always more than fully compensated pensioners through increases in the pensioners pharmaceutical allowance for any PBS copayment increases. The Treasurer did not deny that fact. I wonder whether the minister at the table could confirm it. It was also said in the House today that, if the current bill is passed, pensioners would be as much as $88.40 a year worse off because of increases in the copayment made by the Howard government since 1996. The Treasurer said no, and went on with a general diatribe about increases in the value of the age pension rather than answering the question specifically dealing with the initiative of compensation in that area.Mr Costello was also asked which of the diabetes, asthma and arthritis drugs currently awaiting Pharmaceutical Benefits Scheme listing approval would not receive that approval as a result of the threat to not list drugs in the future. I accept that is a fairly hard question to answer, but I ask the minister at the table: if the situation is—as appears to be the case in terms of the actions of the Senate—that the government's proposal is not passed, and therefore the Treasurer's threat to the listing of drugs in the future is carried out, has any work been done on the processes that would be followed to decide which of these drugs would be denied to needy populations in the community?I would also like the minister to comment on the Treasurer's claim that the state of the PBS at $4.2 billion a year was unsustainable, given that that is inconsistent with the advice of the former health minister, who said just last June that it was sustainable at precisely that amount. Does he agree with the previous health minister or the current Treasurer and, if so, why? I believe the Treasurer also said today that the government had a mandate to increase PBS copayments. Given the stated position of the former health minister prior to the election, and the lack, as I understand it, of any policy initiative with respect to that area during the election campaign, are we talking about a mandate on the basis of `We won, you lost'? I understand that mandate; I have been affected by it one way or another after various elections in recent times, but I am wondering whether there is anything specific that the minister could refer to which justifies this position other than the general `We won, you lost' mandate.19:16:003992Andrews, Kevin, MPMr ANDREWSHK5MenziesLPMinister for Ageing10—Can I say to the honourable member for Bruce that I cannot add anything to the excellent answers that the Treasurer provided in question time today.19:16:003992Griffin, Alan, MPMr GRIFFINVU5BruceALP00—I am disappointed in the minister, because I have always had a higher opinion of him than that.19:16:003992Windsor, Antony, MPMr WINDSOR009LPNew EnglandIND00—I wish to raise a couple of issues in relation to aged care, particularly in rural and regional constituencies. I wish the minister well in his new ministry and I know he is intending to travel to many of the regional areas of Australia and look at the particular problems that those communities have. One of the underlying problems that I see in relation to aged care in particular—though there are some aspects that cover other health areas—is the fairly inflexible formula that is used for working out bed allocations for our older community. I say that fully understanding the complexities of the arrangements and the demands on the government dollar. But circumstances arise almost every year where, because of distance, remoteness and smallness, various communities are disadvantaged when it comes to looking after the aged people within their communities. What is tending to happen, in my view, mainly because of the economic efficiencies that can be gained, is a `feedlot' arrangement for aged people. Bigger is better—it is more cost-effective. The most efficient way to deliver the greatest number of services to the highest number of people is to put them in some sort of feedlot arrangement, preferably high-rise where you can use some aspects of gravity to economic advantage. That is something we should guard against very carefully, particularly in regional communities. This sends a message, particularly to those small to medium communities, to leave early: `Don't wait till you are 70 to look for somewhere to retire, to look for a feedlot where you like the view of the sea, or you may have some relatives in Sydney or wherever.' It sends a signal to them to relocate during their working years so that they can re-establish themselves in another community. That creates an imbalance in the social fabric of those towns. I know the minister is aware of that, but it is something that we have to guard against. I know that in the budget documents some money has been freed up for a four-year program that will be made available to regional communities. That is a positive aspect. In New South Wales, for instance, there were some care packages but virtually no bed allocations west of the range. That says a number of things about not only population decline in those western seats but also the inflexibility of the formula. In the major communities the bed allocation is commensurate with the formula that exists, but in other communities that is not the case.On a more parochial basis, at a meeting recently in a small town called Bundarra—and I have raised this issue with the minister privately before—virtually half the community came out to get behind an aged care facility in that particular community. There is an old hospital in that community in quite good order that does not meet the standards required for aged care. I think that is another thing we really have to look at. Maybe there should be some degree of flexibility in relation to standards—and I know I would get struck down by lightning for saying that. We have to appreciate that some people's best accommodation is in their last years of life. Some people would accept a slightly lower standard of premise in their own community rather than a higher standard of premise in another community that was 100 kilometres away, which meant that their relatives could not get to to see them. Maybe there is some room to move in relation to that.This community of Bundarra is a small community. It was allocated 11 beds about two years ago now. The state government has donated an old hospital building. It has raised in the vicinity of $600,000 towards a $900,000 capital improvement of the building to get it to the standard required. The challenge at the meeting the other day was for this relatively small community to raise another $100,000 on its own and it voted unanimously to accept that challenge. The federal government will be approached for some $200,000 towards the $900,000 establishment. (Extension of time granted). I think that is a classic case of smaller communities expressing some degree of independence in the sense that they are willing to get out there and take on the challenge. They just need a hand to finish the job, rather than start it. Too often communities ask governments to start and finish the process rather than, in this case, just finish it.The other issue on aged care that really needs to be considered—this is clear everywhere I go, and I am sure all members of parliament agree—is the money that is consumed in administration and the various processes that the administration people have to go through. It is getting completely out of control. I think enormous savings could be made in restoring a bit of trust in the people who look after our aged community, rather than there being this underlying assumption by the bureaucracy that they are all out to rip the system off. My view is that maybe we should accept a certain degree of impropriety—although that is probably not the right way to say it—rather than have this totalitarian approach and the consumption of so much money just to have documents written that no-one ever reads or really takes much notice of.The other issue that I would raise is the problem of the shortage of doctors right across regional Australia. Although the Deputy Prime Minister in particular, but also others in the parliament, have argued strongly against the use of Medicare provider numbers and differential Medicare rebates when the issue was raised in this parliament, I was very disappointed to see in the budget that they have used both those vehicles to encourage doctors into Western Sydney, Western Melbourne and other areas in the west of those major metropolitan areas. I understand the political imperatives in relation to that, but that is not a good message to send to country communities. The Deputy Prime Minister and others have said that they will not consider geographic use of Medicare provider numbers or a differential Medicare rebate to help drive doctors to where patients are rather than to where the doctors would rather be. But these economic incentives have not been used in the country; they have been used in the western areas of our major metropolitan areas. I am not against Western Sydney getting more doctors, but we have sent a message to country doctors to go back to Sydney rather than encouraging them to look at other practices. Medical indemnity is obviously a problem that the government is wrestling with. In my view, it is doing so very slowly. I know that a lot of the insurance debate is state based, but medical indemnity is not. The federal government needs to take a greater lead in relation to that particular issue. Rural training of doctors in recent years is a good initiative which should be encouraged. Given the fact that the medical profession and others who seem to know suggest from time to time that country kids are more likely to return to the country as doctors than are their city based cousins, maybe our vision for the future should be to have medical schools in country areas. Not only would this encourage country kids to go to that particular medical school; students who are at university in that particular location, wherever it may be, would obviously establish social contacts, maybe marital contacts, and may actually want to live in the country as medical professionals. I think we have this rather absurd structure at the moment where even the limited number of country children who do enter medicine are trained on the coast, and we then expect them all to return to the inland to practise medicine. I think we should be looking at other ways of assisting their training inland. I know this cannot be done overnight, but I think there has to be some sort of long-term view in relation to the medical profession and encouraging country children to participate in that profession. 19:26:003994Andrews, Kevin, MPMr ANDREWSHK5MenziesLPMinister for Ageing10—In reply to the honourable member for New England, may I say that, having grown up in a small country town myself, I understand the sentiment which he is expressing in relation to the needs of people in smaller rural areas in terms of aged care into the future. This is a matter in which the government is obviously, on occasions, trying to balance a number of competing interests. If I could summarise it, our outlook is to try and retain the vitality of institutions and their viability into the future. Of course, a minimum number is required to keep aged care facilities economically viable, and that creates difficulties for those facilities with smaller numbers of beds. I think that leads to two other considerations. One is that we need to be flexible in the way in which we address these issues. For example, I think the multipurpose centres which are now operating in many parts of rural Australia are a flexible approach to the whole range of health and aged care needs within many rural areas. Secondly, I think there is often a need for a regional approach so that we can provide hubs and networks in which we can actually provide more services to rural areas. I agree with the honourable member's comments about the burden of paperwork in the aged care sector. It is something which I have addressed recently. We are doing some work on that at the present time and, hopefully, will come up with some options as to how we can uncouple the care plans from the RCS—the classification scale for funding. We are looking to trial that either later this year or early next year, with a view to being able to put a better system into operation. I noted the honourable gentleman's other comments about a range of issues, but I will not specifically comment on them at this stage.Debate (on motion by Mrs Gash) adjourned.Main Committee adjourned at 7.29 p.m.Answers to Questions in Writing3996The following answers to questions were circulated:3996(Question No. 226)2263996Irwin, Julia, MPMrs Irwin83ZFowlerALP00 asked the Minister for Immigration and Multicultural and Indigenous Affairs, upon notice, on 14 March 2002:(1) Was his Department informed of reports made in January and February 2002 of children at risk at the Villawood Detention Centre.(2) Has he been briefed by his Department on the reports; if so, when.(3) What action has been taken in response to the reports.3996Ruddock, Philip, MPMr Ruddock0J4BerowraLPMinister for Immigration and Multicultural and Indigenous Affairs and Minister Assisting the Prime Minister for Reconciliation10—The answer to the honourable member's question is as follows:(1) My Department was informed of reports made in January and February 2002 regarding a number of children at the Villawood Immigration Detention Centre. (2) My Department provided me with a briefing on these reports on 14 February 2002.(3) The reports contained a number of recommendations for the ongoing management of families at the Villawood Immigration Detention Centre. These recommendations have been taken into account in the ongoing management of the children and/or families who were the subject of the reports.3996(Question No. 289)2893996Fitzgibbon, Joel, MPMr Fitzgibbon8K6HunterALP00 asked the Minister for Employment and Workplace Relations, upon notice, on 14 May 2002:(1) Has his attention been drawn to the cases of (a) Kevin Ferguson, (b) Ian Paul King, (c) John Leslie Cox, (d) Noel Thomas Adam, (e) Terence Richard Adam, (f) Bruce William Barrance, (g) Robert John Bashford, (h) Francis Alan Becker, (i) Michael John Bower, (j) Gordon Hutcheson Bradley, (k) Ronald Garry Brown, (l) Stephen James Cherrett, (m) John William Childs, (n) Arie Gerardus Christe, (o) Richard Allen Cooke, (p) Gary John Crebert, (q) David John Cresswell, (r) Raymond John Crouch, (s) Phillip Henry Curnow, (t) Drew Dewar and (u) Robert Bruce Riley from the Hunter Valley No. 1 coalmine, who were found to be unfairly dismissed over three years ago, and who still have not been reinstated.(2) Has his attention been drawn to the cases of (a) Ross Roy McKechnie, (b) Stephen John Ingle, (c) Robert John Rae, (d) Harold David Reading, (e) Rogan John Charles, (f) Wayne Kevin Rooney, (g) Phillip Robert Schultz, (h) George Selby, (i) Justin Allan Shannon and (j) Kerry James Sharpe from the Mount Thorley coalmine, who were found to be unfairly dismissed over three years ago, and who still have not been reinstated.(3) Is he aware that the Government's unfair dismissal legislation has resulted in Rio Tinto pursuing lengthy and expensive appeal claims.(4) Will he urge the company to cease its corporate bullying, stop its litigation and reinstate these workers under the principle of justice delayed is justice denied. 3996Abbott, Tony, MPMr AbbottEZ5WarringahLPMinister for Employment and Workplace Relations and Minister Assisting the Prime Minister for the Public Service10—The answer to the honourable member's question is as follows:(1) I am aware of the unfair dismissal cases at Hunter Valley No. 1 coalmine.(2) I am aware of the unfair dismissal cases at Mount Thorley coalmine.(3) The provisions of the Workplace Relations Act 1996 that allow appeals from decisions and orders of the Commission about unfair dismissal were not introduced by this Government, but the Keating Labor Government.Section 45 of the Industrial Relations Act 1988 provided that appeals could be made to a Full Bench of the Commission against “an award or order made by a member of the Commission” and that those people specified in section 170JF were entitled to appeal against unfair dismissal orders (paragraphs 45(1)(b) and (3)(aa)).Section 170JF of the Industrial Relations Act 1988 provided that an appeal to a Full Bench could be instituted by a person entitled to apply for a variation or revocation of an order under section 170JD.Except for a few very minor word changes, existing sections 45, 170JD and 170JF of the Workplace Relations Act 1996 mirror the provisions of the Industrial Relations Act 1988, so the laws about who may appeal and when continue to operate in the same way as the laws introduced by Labor.(4) I understand that the parties have reached a settlement in the matter.3997(Question No. 290)2903997George, Jennie, MPMs GeorgeJH5ThrosbyALP00 asked the Minister for Employment and Workplace Relations, upon notice, on 14 May 2002:(1) Has his attention been drawn to the cases of (a) Errol John Munzenberger, (b) Neil Edward Noonan, (c) James William O'Dwyer, (d) Francis Alexander Palmowski, (e) Michael Paul Palmowski, (f) Kevin Edward Patterson, (g) Raymond Robert Peters, (h) David Michael Power, (i) Thomas William Price, (j) George Bruce Rowland, (k) Barry William Scott, (l) Bryan Robert Scott, (m) Edward Andrew Seaby, (n) Colin Ralph Slade, (o) Rick Desmond Sloane, (p) Terry Robert Smith, (q) Brian Kenneth Sproule, (r) Michael Richard Standing, (s) Richard Laurence Wakeling, (t) Lionel Mervyn Welsh and (u) Geoffrey Mellon from the Hunter Valley No. 1 coalmine, who were found to be unfairly dismissed over three years ago, and who still have not been reinstated. (2) Has his attention been drawn to the cases of (a) Greg Fellowes, (b) Angelo Lino Farrugia, (c) Colin John Feeney, (d) Kerry Foster, (e) Frederick Ernest Fowler, (f) Lance Patrick Frost, (g) Colin Patrick Goward, (h) Paul John Fan, (i) Henry Dalibonzek and (j) Paul John Dangel from the Mount Thorley coalmine, who were found to be unfairly dismissed over three years ago, and who still have not been reinstated.(3) Is he aware that the Government's unfair dismissal legislation has resulted in Rio Tinto pursuing lengthy and expensive appeal claims. (4) Will he urge the company to cease its corporate bullying, stop its litigation and reinstate these workers under the principle of justice delayed is justice denied3997Abbott, Tony, MPMr AbbottEZ5WarringahLPMinister for Employment and Workplace Relations and Minister Assisting the Prime Minister for the Public Service10—The answer to the honourable member's question is as follows:(1) I am aware of the unfair dismissal cases at Hunter Valley No. 1 coalmine. (2) I am aware of the unfair dismissal cases at Mount Thorley coalmine. (3) The provisions of the Workplace Relations Act 1996 that allow appeals from decisions and orders of the Commission about unfair dismissal were not introduced by this Government, but the Keating Labor Government.Section 45 of the Industrial Relations Act 1988 provided that appeals could be made to a Full Bench of the Commission against “an award or order made by a member of the Commission” and that those people specified in section 170JF were entitled to appeal against unfair dismissal orders (paragraphs 45(1)(b) and (3)(aa)).Section 170JF of the Industrial Relations Act 1988 provided that an appeal to a Full Bench could be instituted by a person entitled to apply for a variation or revocation of an order under section 170JD.Except for a few very minor word changes, existing sections 45, 170JD and 170JF of the Workplace Relations Act 1996 mirror the provisions of the Industrial Relations Act 1988, so the laws about who may appeal and when continue to operate in the same way as the laws introduced by Labor.(4) I understand that the parties have reached a settlement in the matter.3998(Question No. 291)2913998Grierson, Sharon, MPMs Grierson00AMPNewcastleALP00 asked the Minister for Employment and Workplace Relations, upon notice, on 14 May 2002:(1) Has his attention been drawn to the cases of (a) William John Martin, (b) Christopher Mark Raisbeck, (c) Barry Alexander Williamson, (d) Dennis Raymond Wilson, (e) Michael J. Zysek, (f) Bertie Arnold Andrews, (g) Laurence James Kelly, (h) William Robert Archbold, (i) Bruce James Crawford, (j) Bradley Charles Mell, (k) Mark Rankovich, (l) John Alexander Sneddon, (m) Ian John Lewis, (n) Christopher John Kennedy, (o) Bryan Michael Griffin, (p) James William Irving, (q) Terence John O'Neill, (r) Alan Stanley Procter, (s) Bruce William Evans, (t) Timothy Graham Standen, (u) Paul Davis Howard Richards, (v) Allan Edward Burford and (w) Neville Thomas Meehan from the Hunter Valley No. 1 coalmine, who were found to be unfairly dismissed over three years ago, and who still have not been reinstated.(2) Has his attention been drawn to the cases of (a) Christopher Scott Taylor, (b) Darren Ashley White, (c) Karl David Boettcher, (d) Glenn Francis Wilson, (e) Darrell Rodney Wright, (f) John Gregory Adam, (g) David Peter Asquith, (h) Murray Baker, (i) Terrence James Ball and (j) Michael John Barrett from the Mount Thorley coalmine, who were found to be unfairly dismissed over three years ago, and who still have not been reinstated.(3) Is he aware that the Government's unfair dismissal legislation has resulted in Rio Tinto pursuing lengthy and expensive appeal claims.(4) Will he urge the company to cease its corporate bullying, stop its litigation and reinstate these workers under the principle of justice delayed is justice denied. 3998Abbott, Tony, MPMr AbbottEZ5WarringahLPMinister for Employment and Workplace Relations and Minister Assisting the Prime Minister for the Public Service10—The answer to the honourable member's question is as follows:(1) I am aware of the unfair dismissal cases at Hunter Valley No. 1 coalmine.(2) I am aware of the unfair dismissal cases at Mount Thorley coalmine.(3) The provisions of the Workplace Relations Act 1996 that allow appeals from decisions and orders of the Commission about unfair dismissal were not introduced by this Government, but the Keating Labor Government.Section 45 of the Industrial Relations Act 1988 provided that appeals could be made to a Full Bench of the Commission against “an award or order made by a member of the Commission” and that those people specified in section 170JF were entitled to appeal against unfair dismissal orders (paragraphs 45(1)(b) and (3)(aa)).Section 170JF of the Industrial Relations Act 1988 provided that an appeal to a Full Bench could be instituted by a person entitled to apply for a variation or revocation of an order under section 170JD.Except for a few very minor word changes, existing sections 45, 170JD and 170JF of the Workplace Relations Act 1996 mirror the provisions of the Industrial Relations Act 1988, so the laws about who may appeal and when continue to operate in the same way as the laws introduced by Labor.(4) I understand that the parties have reached a settlement in the matter. 3998(Question No. 292)2923998Hall, Jill, MPMs Hall83NShortlandALP00 asked the Minister for Employment and Workplace Relations, upon notice, on 14 May 2002:(1) Has his attention been drawn to the cases of (a) Glendon Reginald James Edwards, (b) Darrin Robert Faulds, (c) Michael Roy Field, (d) Brian Lester, (e) Peter John Fletcher, (f) Paul Garaty, (g) Colin John Goodwin, (h) Robert William Groves, (i) Brett Hassett, (j) John Arthur Heuston, (k) Kerry Charles Hills, (l) Grahame William Horne, (m) Fred Horvath, (n) Kevin Hug, (o) Michael Joseph Kuosman, (p) Raymond Claude Lambert, (q) Craig Anthony Leggett, (r) Stephen Mark Langsford, (s) Glen Francis Lantry, (t) Gary John Lowe and (u) Robert John Macbain from the Hunter Valley No. 1 coalmine, who were found to be unfairly dismissed over three years ago, and who still have not been reinstated.(2) Has his attention been drawn to the cases of (a) Glenn Athur Beckett, (b) John Colin Burgess, (c) Mathew James Cahill, (d) Christopher John Cahill, (e) James Leonard Calton, (f) Warwick Desmond Cox, (g) Cameron Graham Ian, (h) Gregory Scott Crocker, (i) Michael Noel Ellicott, (j) Glen Gordon Fairhall and (k) John Stephen Wells from the Mount Thorley coalmine, who were found to be unfairly dismissed over three years ago, and who still have not been reinstated.(3) Is he aware that the Government's unfair dismissal legislation has resulted in Rio Tinto pursuing lengthy and expensive appeal claims.(4) Will he urge the company to cease its corporate bullying, stop its litigation and reinstate these workers under the principle of justice delayed is justice denied.3999Abbott, Tony, MPMr AbbottEZ5WarringahLPMinister for Employment and Workplace Relations and Minister Assisting the Prime Minister for the Public Service10—The answer to the honourable member's question is as follows:(1) I am aware of the unfair dismissal cases at Hunter Valley No. 1 coalmine.(2) I am aware of the unfair dismissal cases at Mount Thorley coalmine.(3) The provisions of the Workplace Relations Act 1996 that allow appeals from decisions and orders of the Commission about unfair dismissal were not introduced by this Government, but the Keating Labor Government.Section 45 of the Industrial Relations Act 1988 provided that appeals could be made to a Full Bench of the Commission against “an award or order made by a member of the Commission” and that those people specified in section 170JF were entitled to appeal against unfair dismissal orders (paragraphs 45(1)(b) and (3)(aa)).Section 170JF of the Industrial Relations Act 1988 provided that an appeal to a Full Bench could be instituted by a person entitled to apply for a variation or revocation of an order under section 170JD.Except for a few very minor word changes, existing sections 45, 170JD and 170JF of the Workplace Relations Act 1996 mirror the provisions of the Industrial Relations Act 1988, so the laws about who may appeal and when continue to operate in the same way as the laws introduced by Labor.(4) I understand that the parties have reached a settlement in the matter.3999(Question No. 294)2943999Hoare, Kelly, MPMs Hoare83YCharltonALP00 asked the Minister for Employment and Workplace Relations, upon notice, on 14 May 2002:(1) Has his attention been drawn to the cases of (a) Stephen Allan Brennan, (b) John William Kershaw, (c) Allan Bromage, (d) Stephen Timothy Mushenko, (e) Peter John Hebbe, (f) Stephen John Garland, (g) Christopher James Frost, (h) Linus John Hoggan, (i) Stephen Beiger, (j) Phillip Kerr, (k) Steven Smith, (l) Bruce Moore, (m) David Powis, (n) Paul Mitchell, (o) Stephen Keith Diessel, (p) Keith William Drage, (q) Warren Peter Edwards, (r) Kelvin Ede, (s) James McDonnell Ekin, (t) Edwards Lawrence Dowse, (u) Neil Burt and (v) Stephen White from the Hunter Valley No. 1 coalmine, who were found to be unfairly dismissed over three years ago, and who still have not been reinstated.(2) Has his attention been drawn to the cases of (a) Paul Ronald Thoroughgood, (b) Craig Michael Sills, (c) Bradley Stewart Solman, (d) Ross Spinks, (e) Shane Raymond Standing, (f) John William Stapleford, (g) Grant James Tanks, (h) John Tunney and (i) Marcus Henri Vaughan from the Mount Thorley coalmine, who were found to be unfairly dismissed over three years ago, and who still have not been reinstated.(3) Is he aware that the Government's unfair dismissal legislation has resulted in Rio Tinto pursuing lengthy and expensive appeal claims.(4) Will he urge the company to cease its corporate bullying, stop its litigation and reinstate these workers under the principle of justice delayed is justice denied.3999Abbott, Tony, MPMr AbbottEZ5WarringahLPMinister for Employment and Workplace Relations and Minister Assisting the Prime Minister for the Public Service10—The answer to the honourable member's question is as follows:(1) I am aware of the unfair dismissal cases at Hunter Valley No. 1 coalmine.(2) I am aware of the unfair dismissal cases at Mount Thorley coalmine.(3) The provisions of the Workplace Relations Act 1996 that allow appeals from decisions and orders of the Commission about unfair dismissal were not introduced by this Government, but the Keating Labor Government.Section 45 of the Industrial Relations Act 1988 provided that appeals could be made to a Full Bench of the Commission against “an award or order made by a member of the Commission” and that those people specified in section 170JF were entitled to appeal against unfair dismissal orders (paragraphs 45(1)(b) and (3)(aa)). Section 170JF of the Industrial Relations Act 1988 provided that an appeal to a Full Bench could be instituted by a person entitled to apply for a variation or revocation of an order under section 170JD.Except for a few very minor word changes, existing sections 45, 170JD and 170JF of the Workplace Relations Act 1996 mirror the provisions of the Industrial Relations Act 1988, so the laws about who may appeal and when continue to operate in the same way as the laws introduced by Labor. (4) I understand that the parties have reached a settlement in the matter.4000(Question No. 296)2964000Livermore, Kirsten, MPMs Livermore83ACapricorniaALP00 asked the Minister for Employment and Workplace Relations, upon notice, on 14 May 2002:(1) Has his attention been drawn to the cases of (a) Brian Walsh, (b) Robert Smith, (c) Tod Rogers, (d) Alan McGuiness, (e) Bruce Mitchelson, (f) Gary Mannion, (g) Morgan Lindley, (h) Trevor Kelly, (i) Don Halverson, (j) Athol Finger, (k) Bob Cusack, (l) Gabby Crichton, (m) Ron Bettridge, (n) Garry Barnes, (o) Ned Appleton and (p) Mitch Albert from the Blair Athol coalmine, who were found to be unfairly dismissed over three years ago, and who still have not been reinstated.(2) Is he aware that the Government's unfair dismissal legislation has resulted in Rio Tinto pursuing lengthy and expensive appeal claims.(3) Will he urge the company to cease its corporate bullying, stop its litigation and reinstate these workers under the principle of justice delayed is justice denied.4000Abbott, Tony, MPMr AbbottEZ5WarringahLPMinister for Employment and Workplace Relations and Minister Assisting the Prime Minister for the Public Service10—The answer to the honourable member's question is as follows:(1) I am aware of the unfair dismissal cases at the Blair Athol coalmine.(2) The provisions of the Workplace Relations Act 1996 that allow appeals from decisions and orders of the Commission about unfair dismissal were not introduced by this Government, but the Keating Labor Government.Section 45 of the Industrial Relations Act 1988 provided that appeals could be made to a Full Bench of the Commission against “an award or order made by a member of the Commission” and that those people specified in section 170JF were entitled to appeal against unfair dismissal orders (paragraphs 45(1)(b) and (3)(aa)).Section 170JF of the Industrial Relations Act 1988 provided that an appeal to a Full Bench could be instituted by a person entitled to apply for a variation or revocation of an order under section 170JD.Except for a few very minor word changes, existing sections 45, 170JD and 170JF of the Workplace Relations Act 1996 mirror the provisions of the Industrial Relations Act 1988, so the laws about who may appeal and when continue to operate in the same way as the laws introduced by Labor.(3) The company has a right to pursue all avenues available under the Workplace Relations Act 1996.4000(Question No. 298)2984000Lawrence, Dr Carmen, MPDr LawrenceXS4FremantleALP00 asked the Minister for Immigration and Multicultural and Indigenous Affairs, upon notice, on 14 May 2002:(1) Is he aware of reports that two young women died or committed suicide in the Villawood Detention Centre, one on or about 26 September 2001 and the other on or about 13 January 2002.(2) Is he aware of the circumstances in which each of these women died; if so, what are the details; if not, what does he propose to do to ascertain the circumstances of their deaths.(3) What does he propose to do to formally establish the causes of the deaths.(4) What does he propose to do to ascertain whether errors were made in the treatment or care of these women while in the custody of the Commonwealth Government.4001Ruddock, Philip, MPMr Ruddock0J4BerowraLPMinister for Immigration and Multicultural and Indigenous Affairs and Minister Assisting the Prime Minister for Reconciliation10—The answer to the honourable member's question is as follows:(1) I am aware of reports that a female detainee died at the Villawood Immigration Detention Centre on 26 September 2001.I am also aware that a female detainee died at Liverpool Hospital on 13 January 2002 after being transferred from the Villawood Immigration Detention Centre on 8 January 2002 to receive medical treatment.(2) The NSW Coroner is yet to hand down findings in relation to these deaths. It would therefore be inappropriate for me to comment further at this time. The NSW Coroner is yet to set dates for the inquests into the deaths.(3) The NSW Coroner will be establishing the causes of death as part of the inquests.(4) Please see answer to part (2).4001(Question No. 299)2994001Latham, Mark, MPMr LathamK26WerriwaALP00 asked the Prime Minister, upon notice, on 14 May 2002:(1) In June 2001 did he tell the Secretary for Australians for the Return of the Parthenon Marbles that he intended to bring the very strong Australian interest in this issue to the attention of the British Prime Minister, Mr Blair, when he visited Australia for the Commonwealth Heads of Government Meeting (CHOGM). (2) In November 2001 did his Department on his behalf inform the Secretary that he considers the Parthenon Marbles an irreplaceable part of Greek heritage and national identity and has publicly expressed some sympathy for their return.(3) Did he bring this to Mr Blair's attention (a) at the adjourned CHOGM in March 2002 or (b) in London in April 2002; if so, what was Mr Blair's response.4001Howard, John, MPMr HowardZD4BennelongLPPrime Minister10—The answer to the honourable member's question is as follows:(1) Yes(2) I am advised that my Department did write on my behalf to the Secretary in those terms.(3) (a) Yes - see my response to Senator Bolkus' Question on Notice No 194. I am confident that Mr Blair took careful note of what I had to say about Australian community concerns on the issue. (b) No.4001(Question No. 314)3144001Thomson, Kelvin, MPMr Kelvin ThomsonUK6WillsALP00 asked the Minister for Employment Services, upon notice, on 14 May 2002:How many `Work for the Dole' schemes have been funded in the electoral divisions of (a) Wills and (b) Deakin and how is the effectiveness of each project measured.4001Brough, Mal, MPMr Brough2K6LongmanLPMinister for Employment Services10—The answer to the honourable member's question is as follows:Work for the Dole activities approved since November 1997 in the electorate of Deakin number 136 and in the electorate of Wills, 215.Community Work Coordinators (CWCs) which are contracted to develop and manage Work for the Dole activities are required to seek approval for each activity before it commences. The application requires CWCs to address three selection criteria:· does the activity meet the needs of the local community;· the ability of the Community Work Coordinator to monitor and support the progress of participants during their placement; and· the ability to provide support to participants on completion of the project.During the activity CWCs are contractually required to monitor each activity to ensure it is proceeding according to the approved application. In addition the department monitors a selection of activities to ensure CWCs are meeting their contractual obligations.Within 30 days of the completion of each activity and before a final payment to the CWC can be made, CWCs are required to submit a report to the department which includes a detailed statement on the performance of the activity.4002(Question No. 319)3194002McClelland, Robert, MPMr McClellandJK6BartonALP00 asked the Minister for Employment and Workplace Relations, upon notice, on 14 May 2002:Has the Government undertaken any research in respect of the extent to which illegal immigrants work in the building and construction industry; if so, what does that research reveal; if not will he take action to ensure that appropriate investigations are undertaken.4002Abbott, Tony, MPMr AbbottEZ5WarringahLPMinister for Employment and Workplace Relations and Minister Assisting the Prime Minister for the Public Service10—The answer to the honourable member's question is as follows:The Department of Employment and Workplace Relations has not undertaken any research on these matters nor have I directed my department to undertake such research.4002(Question No. 320)3204002McClelland, Robert, MPMr McClellandJK6BartonALP00 asked the Minister for Employment and Workplace Relations, upon notice, on 14 May 2002:Has the Government undertaken any research in respect of the extent of tax evasion in the building and construction industry; if so, what does that research reveal; if not, will he ensure that such research is undertaken.4002Abbott, Tony, MPMr AbbottEZ5WarringahLPMinister for Employment and Workplace Relations and Minister Assisting the Prime Minister for the Public Service10—The answer to the honourable member's question is as follows:The Department of Employment and Workplace Relations has not undertaken any research on these matters nor have I directed my department to undertake such research.4002(Question No. 321)3214002McClelland, Robert, MPMr McClellandJK6BartonALP00 asked the Minister for Employment and Workplace Relations, upon notice, on 14 May 2002:Has the Government undertaken any research as to the extent to which sham independent contracting arrangements may be used in the building and construction industry for the purpose of avoiding or minimising taxation obligations; if so, what does the research reveal; if not, will the Commonwealth ensure that such research is undertaken. 4002Abbott, Tony, MPMr AbbottEZ5WarringahLPMinister for Employment and Workplace Relations and Minister Assisting the Prime Minister for the Public Service10—The answer to the honourable member's question is as follows:The Department of Employment and Workplace Relations has not undertaken any research on these matters nor have I directed my department to undertake such research.4002(Question No. 350)3504002Ferguson, Martin, MPMr Martin FergusonLS4BatmanALP00 asked the Minister for Education, Science and Training, upon notice, on 14 May 2002:(1) Has he been briefed on a meeting held at the National Library of Australia on 8 March 2002 to discuss problems relating to the provision of library services to people with disabilities, including (a) the fact that large collections of analogue tape held by the specialist libraries for the blind and vision impaired will not be able to be accessed in three to five years time as equipment to play the tapes will no longer be manufactured, (b) the fact that these libraries do not have access to funding to facilitate the transfer of information from analogue to digital tape and (c) the need to facilitate alternative formats for students with disabilities.(2) What work has been undertaken by Government to assist in overcoming these potential huge barriers to learning by people with disabilities.4003Nelson, Dr Brendan, MPDr NelsonRW5BradfieldLPMinister for Education, Science and Training10—The answer to the honourable member's question is as follows:(1) (a) (b) (c) The Minister for Education, Science and Training has not been briefed specifically on the meeting held by the National Library on 8 March 2002, although an officer from his Department did attend. In respect of his higher education responsibilities, the Minister has been briefed on the broad issues related to the high cost of translating written text into formats accessible by people with a visual impairment or other print handicap. (2) The Government supports the right of children with disabilities to the same educational opportunities as other children. While the States and Territories have primary responsibility for the funding and delivery of school education, the Commonwealth provides substantial funding for both the government and non-government school sectors, which includes targeted funding to improve the educational outcomes of students with disabilities. The funding provided by the Commonwealth for students with disabilities in schools is block funding to the States and Territories and is not allocated for specific purposes. The State and Territory education authorities decide how it is to be used to support the needs of students with disabilities in their respective systems. The Government has recognised the very high costs that some universities are bearing with regard to support for some students with disabilities, including students with a visual impairment or print handicap who require course materials and related texts in alternative formats. In the 2001 budget, the new Additional Support for Students with Disabilities Programme was announced, with some $8 million to be allocated between 2002 and 2004. The programme will commence in the second half of this year, with $1.834 million available to universities to assist with the high costs associated with supporting students with disabilities.Officers of the Department of Education, Science and Training are monitoring the issue and participated in the Human Rights and Equal Opportunity Commission's forum on the provision of alternative formats in the tertiary sector held in Sydney on 29 May 2002. The Commonwealth continues to actively support the Regional Disability Liaison Officer (RDLO) initiative. Funded for three years at $800,000 per year, eleven RDLOs across the nation perform a range of functions, which are focused on the provision of practical assistance and support to students with disabilities to make the transition from school to TAFE or university and on to employment. RDLOs generally have a good knowledge of where students with disabilities can find information and assistance related to specific needs. Under the national vocational education and training (VET) arrangements, funding for VET is a shared responsibility between the Commonwealth and States and Territories. State and Territory Governments are responsible for the delivery of training, including to people with disabilities. The Commonwealth provides funds for VET through the Australian National Training Authority to States and Territories. These funds supplement those provided by State and Territory Governments.The needs of people with disabilities have been recognised. The Commonwealth and all State and Territory Ministers have signed up to implement Bridging Pathways: a National Strategy and Blueprint for people with disabilities in VET for 2000-2005 with the aim of increasing opportunities for people with disabilities in VET. The Commonwealth has provided $2 million for national actions outlined in the Blueprint. In the 2002-03 Commonwealth Budget, the Government announced that it would provide over $33 million additional funds for the VET system to meet the needs of people affected by changes to the Disability Support Pension. This is on top of the Australians Working Together (AWT) initiative announced in the 2001-02 Commonwealth Budget, when the Commonwealth provided $24.4 million for four years from 1 July 2002 to contribute to States' and Territories' efforts to assist people with a disability to enter and complete a VET course. A Disability Coordination Officer (DCO) Programme, also announced as part of the AWT package, aims to provide information, coordination and referral services for people with a disability interested in participating in post-school education and training and to assist them to succeed in their chosen studies. The DCO Programme will commence on 1 July 2002.4004(Question No. 353)3534004Gibbons, Steve, MPMr Gibbons83XBendigoALP00 asked the Minister for Industry, Tourism and Resources, upon notice, on 15 May 2002:(1) Is he aware of the Australian Standard for Glass in Buildings AS1288 Review.(2) Will these changes cause the leadlighting industry to end and over 2000 small businesses to close.(3) Why does leadlight need to be triple glazed.(4) How will heritage buildings have their leadlight windows repaired or replaced.(5) Why is there no standard for leadlight glazing in the proposed amendments.(6) Why does leadlight have to be covered by other “brittle” glass when there is no evidence held by the Australian Bureau of Statistics of any injuries caused by human impact with leaded glass.(7) What statistics necessitated the covering and changing of the codes for leadlight.(8) Why do precautions have to be taken to provide mechanical protection to glazing in critical locations; or enhancing a person's awareness of the presence of glass by making it visible, when leadlight, with its composition of lead and colour, does just that.(9) Why is safety glass required when leadlight, by virtue of its construction, minimises the risk of cutting or piercing injuries.(10) Why does the area covered for human impact safety requirements go from 500mm off the floor to 2000mm off the floor, an increase of 400% in height.(11) Why does the minimum glass requirements for windows above 500mm off the floor increase from 3mm to 5mm laminated glass or 4mm toughened.(12) What statistics prompted these changes and if they show an increase in accidents, are they relevant proportional figures.(13) Why does glass below 2000mm need to be specially toughened or laminated.(14) Does the Standard refer to windows; if so, how frequently.(15) Is it the policy of the Standards Committee to adopt or move toward international standards; if so, why is there a different or lesser standard for New Zealand.(16) Does 3mm float glass currently cost $16.45 per square metre while 5mm laminated glass currently costs $64.24 per square metre; if so, which interests represented on the committee will benefit most by the new Standard.(17) Has it taken years to formulate the new standard; if so, why is there such a short time for (a) submissions for changes and (b) the Standard to be implemented.(18) Does the Standards Committee have before it a draft document on Standards for Leadlighting which it approved on 23 January 2002; if so, why was that draft not released as part of the draft for the AS1288 review.(19) Why will the project 3405 document be released for public comment on 26 July 2002 when the closure date for the review of AS1288 Review is 30 May 2002.(20) If leadlight is to be covered under AS1288, and the Standards Committee already has a review document for leadlight, should leadlight be reviewed in the same time frame within the same document.(21) Is it the case that leadlight which is not produced by a large glass manufacturer and found in some of the largest windows in towns and cities in Australia, including church windows, is condemned and omitted in the Standards Review, while products of the large glass manufacturers are liberally looked after with requirements such as toughened glass having to be treated by a large company and the use of expensive laminated glass compared to the glass presently used.(22) Is Pilkington Glass represented on the Committee; if so, did it unload its stained glass stocks at the same time as AS1288 Review was released for public comment.4004Macfarlane, Ian, MPMr Ian MacfarlaneWN6GroomLPMinister for Industry, Tourism and Resources10—The answer to the honourable member's question is as follows:(1) Yes.(2) No. The proposed changes to the draft standard will only affect leadlight used in installations where there are human impact requirements, however it will have no effect when used outside these areas.(3) It is proposed that leadlight glazing in high-risk areas, eg doors etc, ought to be protected by triple glazing only where there is a risk of human impact.(4) The revised standard will not apply in those circumstances where human impact is not at risk. Most applications in heritage buildings would fall outside the coverage of the standard.(5) Draft standard, AS 1288.2 - Lead light and stained glass construction and installation, is being prepared dealing with construction and installation of leadlight glazing and stained glass and is expected to be released for public comment on 4 June 2002.(6) The aim of the standard is to enhance the level of safety around all glazed installations where there is a potential risk of injury.(7) Standards for human impact are moving towards higher levels of public safety and minimising potential risk. (8) There is no requirement in the draft standard to enhance visibility of leadlight glazing. (9) The breakage characteristics of annealed glass in lead light may cause cutting and serious injuries.(10) This provision applies to bathrooms, en suites and spa rooms and is intended to ensure that on every occasion the appropriate level of safety is built into the window provided.(11) The issue is one of safety, taking into consideration the breakage characteristics of annealed glass.(12) Standards for human impact are moving towards higher levels of public safety and minimising potential risk.(13) In the event of accidental human contact, the use of toughened or safety glass represents less of a risk of injury.(14) Yes. The word “window” is referred to five times in the text, and once in a figure, of the draft standard AS 1288.1; and once in the text of the draft standard AS 1288.2.(15) Yes. It is not in the interest of public safety to lower performance characteristics when the higher standard is already accepted in the market place.(16) The costs for glass is a commercial matter and subject to market pressures from time to time. Those interests on the committee concerned with public safety will benefit most from the proposed changes.(17) Yes.(a) The period for comment (two months) complies with Standards Australia policy. Extensions are allowed in the case of relevant stakeholders requesting to make additional submissions. (b) The draft standards have not been implemented. There is no time limit on committee consideration of stakeholder comments to reach consensus.(18) The leadlight draft standard AS 1288.2 was approved by the committee for release as a draft on 3 May 2002 (not 23 January) and is expected to be released for public comment on 4 June 2002, closing on 6 August 2002. The second draft standard, AS 1288.2, was not finalised when the draft revision of AS 1288 - 1994 (AS 1288.1) was ready for public comment.(19) See response to Question 18.(20) The review of AS 1288 will result in the publication of two documents. AS 1288.1 deals mainly with safety issues related to general glass installations whilst AS 1288.2 will deal with the construction and installations of leadlight. The two new standards are being prepared in parallel but not together.(21) The proposed new requirements in AS 1288.2 apply only to leadlight applications where there is a risk of human impact. (22) Glass manufacturers, along with other key stakeholders and regulators, are represented on the committee to provide a balance of interests and views. I am unable to comment on the commercial activities of the company.4006(Question No. 380)3804006Burke, Anna, MPMs Burke83SChisholmALP00 asked the Minister for Veterans' Affairs, upon notice, on 16 May 2002:(1) How many (a) veterans and (b) spouses of veterans in the electoral division of Chisholm held or hold a Gold Card in (a) 1995, (b) 1996, (c) 1997, (d) 1998, (e) 1999, (f) 2000, (g) 2001 and (h) 2002.(2) How many of these (a) veterans and (b) spouses reside or resided in each of the postcode areas within the electoral division of Chisholm.4006Vale, Danna, MPMrs ValeVK6HughesLPMinister for Veterans' Affairs and Minister Assisting the Minister for Defence10—The answer to the honourable member's question is as follows:Please note that there are no spouses of living veterans who qualify for a gold card unless they are themselves an eligible veteran in their own right, in which case they are included in the tables below as a veteran. However, some dependants of deceased veterans (ie. war widow(er)s and orphans) may be eligible for a gold card. The tables below show those dependants who have a gold card following the death of the veteran. (1) (a) & (b) VeteransDependants (war widow(er)s & orphans)19951,34087919961,23885119971,24591119981,17493319991,58796520001,45990720011,39393220021,338937(2) (a) and (b)Veterans Post code199519961997199819992000200120023125141121123115164130120114312766646458106989692312823821321720826524022621831291591531541471931781711663147817776721018883803148817778728782817431493162932902704083923733563150313131314748464531511312121418212022316674666860676967673168138132129125131113110103316911111111Chisholm Total1,3401,2381,2451,1741,5871,4591,3931,338Dependants (war widow(er)s & orphans) Post code1995199619971998199920002001200231259595102103111889293312765636568676061633128155148161160172160173167312987777985908190913147585658616359626431485350515456555552314919019221121621722021722431502726303033343637315113141515151312133166495154565961616231688579838583747372316911111111Chisholm Total8798519119339659079329374007(Question No. 381)3814007Burke, Anna, MPMs Burke83SChisholmALP00 asked the Minister for Veterans' Affairs, upon notice, on 16 May 2002:(1) How many recipients of a veterans' affairs pension reside or resided in the electoral division of Chisholm in (a) 1995, (b) 1996, (c) 1997, (d) 1998, (e) 1999, (f) 2000, (g) 2001 and (h) 2002.(2) How many of these pensioners reside or resided in each of the postcode areas within the electoral division of Chisholm.4007Vale, Danna, MPMrs ValeVK6HughesLPMinister for Veterans' Affairs and Minister Assisting the Minister for Defence10—The answer to the honourable member's question is as follows:(1) 19951996199719981999200020012002n/an/a3,917n/an/a3,5523,4513,358(2) Post code199519961997199819992000200120023125n/an/a403n/an/a3203042903127n/an/a214n/an/a1971921933128n/an/a671n/an/a5905805603129n/an/a438n/an/a4174053953147n/an/a235n/an/a2112031993148n/an/a234n/an/a2112031893149n/an/a971n/an/a9118898743150n/an/a118n/an/a1241231233151n/an/a61n/an/a5959613166n/an/a194n/an/a1801811793168n/an/a376n/an/a3283082913169n/an/a4n/an/a444Chisholm Totaln/an/a3,917n/an/a3,5523,4513,358Note: · The Department of Veterans' Affairs pensions includes service, disability and war widow(er) pensions.· Figures at postcode level have not been routinely collected in the past for pension recipients, other than for a one-off compilation in 1997, and are unavailable for 1995, 1996, 1998 and 1999.· The figures for 2000, 2001 and 2002 have been derived by matching postcodes to electoral boundaries to determine pensioner numbers by using a predetermined postcode / electoral boundary formula.· The figures for 2002 are as at March 2002.4008(Question No. 405)4054008Gibbons, Steve, MPMr Gibbons83XBendigoALP00 asked the Minister for Veterans' Affairs, upon notice, on 27 May 2002:What action is being taken to bring the Extreme Disablement Adjustment (EDA) up to the same level as the Totally and Permanently Incapacitated (TPI) entitlement.4008Vale, Danna, MPMrs ValeVK6HughesLPMinister for Veterans' Affairs and Minister Assisting the Minister for Defence10—The answer to the honourable member's question is as follows:The Totally and Permanently Incapacitated (T&PI) benefit and Extreme Disablement Adjustment (EDA) serve different purposes. The higher rate of benefit provided to T&PI recipients recognises that they have generally been financially disadvantaged because their working lives have been cut short by their war or defence caused injuries. By contrast, EDA is designed for those elderly and frail veterans who are severely incapacitated by their war or defence caused injuries.However, earlier this year I appointed a high profile and independent committee to examine perceived anomalies in the eligibility criteria for benefits under the Veterans' Entitlements Act 1986. The Committee will also consider submissions made by interested parties as to the structure and appropriateness of disability compensation pensions, including EDA.The Committee will report to me no later than mid-November 2002.4008(Question No. 426)4264008Irwin, Julia, MPMrs Irwin83ZFowlerALP00 asked the Minister representing the Minister for Defence, upon notice, on 28 May 2002:(1) Was HMAS Warramunga involved in Operation Relex in the Indian Ocean in 2001.(2) Was a unit known as the Transit Security Element deployed aboard HMAS Warramunga during that period.(3) Did HMAS Warramunga intercept vessels off Ashmore Island during the operation.(4) Were any personnel of the Transit Security Element issued with (a) truncheons or night sticks, (b) batons or other devices capable of delivering an electric shock or (c) pepper sprays or capsicum sprays or similar products.(5) Were any other units involved in Operation Relex issued with this material.(6) Are any defence force units issued with this material.4009Vale, Danna, MPMrs ValeVK6HughesLPMinister for Veterans' Affairs and Minister Assisting the Minister for Defence10—The Minister for Defence has provided the following answer:(1) Yes.(2) Yes.(3) Yes.(4) (a) Yes. (b) No. (c) Yes.(5) (a) Yes. (b) No. (c) Yes. Other Transit Security Elements.(6) (a) Yes. (b) No. (c) Yes.4009(Question No. 471)4714009Murphy, John, MPMr Murphy83DLoweALP00 asked the Minister for Foreign Affairs, upon notice, on 3 June 2002:(1) How many persons are reported to have been killed in the Maluku region as a consequence of religious strife in that area over the last three years, and of these, how many of those killed have been known to be of (a) Christian and (b) Muslim faith.(2) Is he able to say whether acts of (a) torture, (b) rape, (c) pillage, (d) enforced conversion to Islam, (e) genital mutilation and (f) other atrocities have been perpetrated on the Christian population in the Maluku region; if so, what are the details of the reported atrocities.(3) Is there is a link between the reported atrocities with the organisation known as Laskar Jihad; if so, what is that link.(4) Is there a link between Laskar Jihad and the al-Qa'eda network; if so, what is that link.(5) Can he confirm reports that the number of militants who have entered the Maluku region include (a) Afghans, (b) Pakistanis and (c) Iraqis; if so, what are the estimated number and nationality of those persons who have entered the Maluku region.(6) Does he have intelligence showing the Indonesian Government and its agencies, including the Indonesian Military, having actual or constructive knowledge of those foreign nationals entering Indonesia for the purpose of participating in the atrocities; if so, what is that intelligence.(7) What is the official response of the Indonesian Government to the alleged restoration of the Republic of South Maluku.4009Downer, Alexander, MPMr Downer4G4MayoLPMinister for Foreign Affairs10—The answer to the honourable member's question is as follows:(1) Estimates range from 5000 to 9000. Indonesian authorities have not provided casualty figures by religion.(2) Human rights violations have been committed by all parties in the Malukus.(3) As noted above, human rights violations have been committed by all parties in the Malukus. Indonesian authorities have arrested the leader of the Laskar Jihad on suspicion of inciting violence.(4) The extent of any links that Laskar Jihad may have with groups outside Indonesia is unclear.(5) No.(6) It is government policy not to comment on intelligence matters.(7) The Indonesian government does not recognise this movement.