Wednesday, 1 June 1983 The PRESIDENT (Senator the Hon. Douglas McClelland) took the chair at 11.30 a.m ., and read prayers. Address-in-Reply: Presentation to Governor-General The PRESIDENT —I remind honourable senators that I have ascertained that His Excellency the Governor-General will be pleased to receive the Address-in-Reply to his opening Speech at Government House this afternoon at 5.30 p.m. For this purpose, it is proposed that the sitting of the Senate be suspended at 5 p.m. Cars will be available at the front of Parliament House at 5.15 p.m. for the purpose of taking honourable senators to Government House. Senator BUTTON(Victoria-Leader of the Government in the Senate) —I inform the Senate that Senator Gietzelt will be absent from this chamber today. Any questions which would normally be directed to Senator Gietzelt in relation to his portfolio or those portfolios he represents should today be directed to Senator Grimes. The Clerk-Petitions have been lodged for presentation as follows: Taxation: Lump Sum Superannuation To the Honourable the President and Members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth that we are concerned about any increases in taxation on lump sum superannuation because: The Federal Government does not have a mandate to introduce these changes. During April, the Prime Minister gave a definite assurance that the existing basis of taxation for lump sum superannuation payments would not be altered. The proposed scheme eliminates freedom of choice, in that retirees will be forced into accepting a pension, because of prohibitive taxation levels on lump sum benefits. The existing principle of having only 5 per cent of lump sum benefits attract taxation has been a fundamental maxim of Australian life since at least 1928. Severe pressure will be placed on the ability of superannuation funds to maintain full C.P.I. indexation of pensions. Retirees will be denied the present flexibility that existing legislation allows. In many cases, lump sum payments provide the finance to obtain a standard of living not previously attainable during a working life. The opportunity to invest a lump sum at the individual's discretion will be denied-to avoid the prohibitive taxation rate, a lump sum will have to be converted to an annuity superannuation. Presently, an individual may invest a lump sum entirely at his own discretion, to provide a retirement income which is taxable. Your petitioners most humbly pray that the Senate in Parliament assembled should immediately without reference to a Senate standing committee, reject any legislation to increase taxation on lump sum superannuation. And your petitioners as in duty bound will ever pray. by Senator Macklin (from 85 citizens). To the Honourable the President and Members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth: Their opposition to any change in the taxation of lump sum superannuation. And your petitioners as in duty bound will ever pray. by Senator Macklin (from 80 citizens). To the Honourable the President, and Members of the Senate in Parliament assembled. The Petition of the undersigned citizens of Australia respectfully showeth that whereas the Government of Australia has signed the United Nations Covenant on Civil and Political Rights which in Article 23 (1) states that ''The family is the natural and fundamental group unit of society and is entitled to the protection by society and the State''. And Whereas the terms of the United Nations Convention on the Elimination of All Forms of Discrimination Against Women would violate the above Article 23 (1). We humbly pray the Government to refrain from ratifying the Convention on the Elimination of All Forms of Discrimination Against Women; Believing that its implementation would result in: (1) Undue cost to the nation at this time. (2) 'The elimination of any stereotyped concept of roles of men and women at all levels' as described in Part 3, Article 10 (c), being a disruption of traditional parental roles, is likely to result in emotional disturbances of childhood. (3) The strong encouragements to mothers to join the workforce, with the provision of networks of creches and child care centres as outlined in Article 11 of the convention is likely to result in maternal deprivation and psychological disturbances amoung children with an increase in childhood psychiatric illnesses. (4) The sexual role changing as recommended in Part 3, Article 10 (c) is likely to contribute to further marriage insecurity and breakdown. And we pray you may be conscious of God's sovereign purpose for our Nation and your petitioners in duty bound will ever pray. by Senators Peter Baume (from 20 citizens), Bjelke-Petersen (from 102 citizens), Sir John Carrick (from 17 citizens) and Childs (from 14 citizens). To the Honourable the President, and Members of the Senate in Parliament assembled. we the undersigned citizens of Australia, believing that men and women are equal but different, convinced that Australia can provide equal opportunity for all citizens without foreign treaties, concerned that ratifying the UN Discrimination Convention would give a Communist-dominated international committee the power to judge Australia's laws, Humbly petition that your Honourable House will not ratify the UN Convention on the Elimination of All Forms of Discrimination Against Women. And we will always thus petition. by Senator Macklin (from 20 citizens). The Honourable the Speaker and Members of the Senate in Parliament assembled. The petition of the undersigned citizens of Australia showeth that: The Universal Declaration of Human Rights affirms the principle of the inadmissibility of discrimination and proclaims that all human beings are born free and equal in dignity and rights and that everyone is entitled to all the rights and freedoms set forth therein, without distinction of any kind including distinciton based on sex. However extensive discrimination against women continues to exist. It is an obstacle to the participation of women on equal terms with men, in the political , social, economic and cultural life of this country. It hampers the growth of the prosperity of society and the family and makes more difficult the full developement of the potentialities of women in the service of this country and of humanity. Your petitioners therefore humbly pray that the Commonwealth Government will act to ratify the convention on The Elimination of all Forms of Discrimination Against Women. by Senator Bjelke-Petersen (from 14 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The humble petition of we, the undersigned citizens of Australia, respectfully showeth: That Australia support the ratification of the United Nations Convention on the Elimination of All Forms of Discrimination Against Women. Your petitioners therefore humbly pray that your House urge all politicians to unite nationally to do all within their power to ratify this important Convention. And your petitioners as in duty bound will ever pray. by Senator Crowley (from 20 citizens). To the Honourable the President and the members of Senate in Parliament assembled. The petition of the undersigned students and staff of the University of Queensland respectfully showeth: 1. that in 1979 the Liberal Government introduced overseas student fees, 2. that those fees have been regularly increased since their introduction, 3. that the financial burden has caused hardship for overseas students studying here, who have limited earning capacity. We call on this government to review the decision taken to introduce tertiary fees for overseas students. And your petitioners as in duty bound will ever pray. by Senators Colston (from 46 citizens) and MacGibbon (62 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth: That in 1911, as part of its new responsibility for the Northern Territory, the Commonwealth accepted a binding legislative commitment to construct a railway from Adelaide to Darwin-a promise which has never been fulfilled. The lack of essential transport links has had, and continues to have, serious consequences for the economic and social development of the Northern Territory, and indeed all of Australia. That the future expansion of new industries in the Territory and new trade opportunities for Australia, particularly with South-East Asia and the Western Pacific, depend on the development of the railway to link the port of Darwin with the rest of Australia. The railway is therefore an essential national project related directly to Australia's overall prospects for future economic growth. We therefore protest the Commonwealth's continuing failure to construct the railway. Your petitioners most humbly pray that the Prime Minister and members of the Federal Government honour the promise made by the Commonwealth over 70 years ago , the promise made by the previous Government this year, and endorsed by the present government in opposition to complete the construction of the railway by 1988, Australia's bicentennial year. We call on the Prime Minister to give his personal assurance that the Commonwealth will honour its past and present promises. And your petitioners as in duty bound will ever pray. by Senator Kilgariff (from 409 citizens). Petitions received. Senator BUTTON(Victoria-Leader of the Government in the Senate) —I give notice that, on the next day of sitting, I shall move: (1) That, unless otherwise ordered, the Senate meet on Friday, 3 June 1983 from 9.30 a.m. to 1 p.m., 2.15 p.m. to 6.30 p.m. and 8 p.m. to 10 p.m. (2) That the sessional order relating to the adjournment of the Senate have effect at 10 p.m. on that day. (3) That, notwithstanding anything contained in the Standing Orders and unless otherwise ordered, the Senate, on that day, shall proceed with its ordinary business in the following routine: (a) petitions; (b) notices; (c) formal motions; (d) postponement of Business; (e) motions and orders of the day, or vice versa, as set down on the Notice Paper; (f) at 12 o'clock midday, Questions; (g) further motions and orders of the day, or vice versa, as set down on the Notice Paper. Notice of Motion Senator GARETH EVANS(Victoria-Attorney-General) —I give notice that, on the next day of sitting, I shall move: That leave be given to introduce a Bill for an Act to amend the Freedom of Information Act 1982, and for related purposes. Notice of Motion Senator GARETH EVANS(Victoria-Attorney-General) —I give notice that, on the next day of sitting, I shall move: That leave be given to introduce a Bill for an Act relating to the preservation and use of archival resources, and for related purposes. Notice of Motion Senator GARETH EVANS(Victoria-Attorney-General) —I give notice that, on the next day of sitting, I shall move: That leave be given to introduce a Bill for an Act to amend the Copyright Act 1968. Notice of Motion Senator RYAN(Australian Capital Territory-Minister for Education and Youth Affairs) —I give notice that, on the next day of sitting, I shall move: That leave be given to introduce a Bill for an Act relating to discrimination on the ground of sex, marital status or pregnancy, and to sexual harassment. Senator COATES(Tasmania) —I give notice that, eight sitting days after today, I shall move: (1) That the Law Reform (Miscellaneous Provisions) (Amendment) Ordinance 1982, as contained in the Australian Capital Territory Ordinance No. 95 of 1982 and made under the Seat of Government (Administration) Act 1910, be disallowed. (2) That the Customs (Cinematograph Films) Regulations (Amendment), as contained in Statutory Rules 1983 No. 38 and made under the Customs Act 1901, be disallowed. I seek leave to make a very brief statement. Leave granted. Senator COATES —The first notice of motion concerns section 4 of the Law Reform Ordinance which appears to remove existing rights and claims with retrospective effect. The second notice of motion concerns a drafting practice which may result in legislative requirements to notify persons of appeal rights being nullified by a saving provision. In the case of the first notice of motion today is the last day on which notice may be given and in the case of the second notice of motion it is the second last day. Therefore the Senate Standing Committee on Regulations and Ordinances is giving notice to preserve its rights while awaiting replies from the Attorney-General (Senator Gareth Evans) to correspondence from the Committee. In accordance with practice recently adopted by the Committee, I seek leave to have a fuller statement of the Committee's concerns incorporated in Hansard. Leave granted. The statement read as follows- NOTICES OF DISALLOWANCE LAW REFORM ORDINANCE AND CUSTOMS REGULATIONS Law Reform (Miscellaneous Provisions) (Amendment) Ordinance 1982 The purpose of this Ordinance is to exclude the estate of a deceased person from recovering damages for loss of earning capacity during the years lost to that person by his premature death. The amending Ordinance nullifies the so- called ''lost years'' decision in Fitch v. Hyde-Cates (1982) 39 A.L.R. 581, determined by the High Court on 6 April 1982. The Committee makes no comment on the prospective operation of the amending Ordinance other than to observe that it negates a right the High Court has held to exist. The question of primary concern to the Committee, under its principles , derives from section 4 of the amending Ordinance. This section appears to make the amendment retrospective in operation, with the consequence that existing rights and existing claims are removed. The Committee has sought the views of the Attorney-General on this matter. As today is the last day on which notice may be given, the Committee has given such notice to preserve its rights while awaiting a reply from the Attorney-General. Customs (Cinematograph Films) Regulations (Amendment) The purpose of these regulations is to waive the requirement for censorship examination of films in circumstances such as showing it at a recognised film festival. The regulations provide that the Attorney-General may approve organisations and events to benefit from the relaxation and may revoke the approval. Regulation 34 provides for an appeal to the Administrative Appeals Tribunal against a decision of the Attorney-General. While Regulation 34 (3) provides that the notice: ''. . . shall include a statement to the effect that, subject to the Administrative Appeals Tribunal Act 1975, application may be made to the Administrative Appeals Tribunal for review of the decision to which the notice relates by or on behalf of a person whose interests are affected by the decision .'', Regulation 34 (4) provides: ''(4) A failure to comply with the requirements of sub-regulation (3) in relation to a decision shall not be taken to affect the validity of the decision .'' As indicated to the Senate in November and December last year in relation to an Ordinance of the Australian Capital Territory, the Committee has had some concern that the effect of the ''saving clause'' might be to nullify the legislative provision which should ensure that notification of rights is automatically made to persons affected by decisions which may be subject to appeal. The Committee sought and received a response from the former Attorney- General on the drafting practice which has given rise to this provision. However , the Committee has now asked for the present Attorney-General's views on the matter. As a working rule, the Committee has accepted assurances from successive Ministers administering Ordinances in which this provision has appeared that notification of appeal rights will be routinely given. In this case, however, the regulations were made under the authority of the Attorney-General, whose general comments the Committee now awaits, and therefore the Committee has given notice of disallowance to preserve its rights while the Attorney considers the matter. Senator ROBERTSON(Northern Territory) —I give notice that, on the next day of sitting, I shall move: That the following matter be referred to the Senate Standing Committee on National Resources: The exploitation of the natural resources of the Australian Antarctic Territory with particular reference to: (a) The extent of the natural resources of the Australian Antarctic Territory; (b) The technical, economic and environmental restraints on the exploitation of the natural resources of the Australian Antarctic Territory; and (c) The Commonwealth's role. Senator HARRADINE(Tasmania) —I give notice that, five sitting days after today, I shall move: That the World Heritage (Western Tasmania Wilderness) Regulations, as contained in Statutory Rules 1983 No. 31 and made under the National Parks and Wildlife Conservation Act 1975, be disallowed. Senator JONES(Queensland) —I give notice that, on the next day of sitting, I shall move: That the Standing Committee on Science and the Environment be named the Standing Committee on Science, Technology and the Environment. Senator Sir JOHN CARRICK(New South Wales) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) deplores the abandonment by the Hawke Government of the Fraser Government's $640m five year Bicentennial Water Resources Program; (b) stresses the vital importance to Australia's future of the maximum conservation of our limited water resources; (c) emphasises that the main projects in the programme had been indicated by the States as having high priority, advanced planning and preparedness, short lead times for commencement and relatively short construction times; (d) stresses that many of the projects would create both immediacy of useful employment in the construction period and significant long term new job opportunities in new industries dependent on water; (e) focuses attention upon the importance in New South Wales of the following projects: Split Rock Dam Glenbawn Dam-Stage 2 Mid-Murray Storage (Euston) Menindee Lakes Storage the proposed SMEC feasibility study for the construction of a major Upper Murray storage the proposed feasibility study for the diversion of the Clarence River inland; and (f) regrets that the Hawke Government has given no indication that it will continue to support the existing National Water Resources program which is a Federal-State dollar for dollar sharing programme of great significance to all Australians. Senator LEWIS(Victoria) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) deplores the abandonment by the Hawke Government of the Fraser Government's $640m five year Bicentennial Water Resources Program; (b) stresses the vital importance for Australia's future of the maximum conservation of our limited water resources; (c) emphasises that the main projects in the program had been indicated by the States as having high priority, advanced planning and preparedness, short lead times for commencement and relatively short construction times; (d) stresses that many of the projects would create both immediacy of useful employment in the construction period and significant long term new job opportunities in new industries dependent on water; (e) focuses attention upon the importance in Victoria of the following projects : Lake Merrimu-Stage 3 Piping Wimmera-Mallee water supply scheme-Stage 1 Mitchell River Dam Mid-Murray storage (Euston) Menindee Lakes storage The proposed SMEC feasibility study for the construction of a major Upper Murray storage (f) regrets that the Hawke Government has given no indication that it will continue to support the existing National Water Resources Program which is a Federal-State dollar-for-dollar sharing program of great significance to all Australians. Senator HILL(South Australia) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) deplores the abandonment by the Hawke Government of the Fraser Government's $64m five-year Bicentennial Water Resources Program; (b) stresses the vital importance for Australia's future of the maximum conservation of our limited water resources; (c) emphasises that the main projects in the program had been indicated by the States as having high priority, advanced planning and preparedness, short lead times for commencement and relatively short construction times; (d) stresses that many of the projects would create both immediacy of useful employment in the construction period and significant long-term new job opportunities in new industries dependent on water; (e) focuses attention upon the importance in South Australia of the following projects: Adelaide Water Filtration Scheme Northern Towns Water Filtration Scheme Lock 2 to Lock 3 Salinity Control Works Mid-Murray Storage (Euston) Menindee Lakes Storage The proposed SMEC feasibility study for the construction of a major Upper Murray storage, and (f) regrets that the Hawke Government has given no indication that it will continue to support the existing National Water Resources Program which is a Federal-State dollar-for-dollar sharing program of great significance to all Australians. Senator CRICHTON-BROWNE(Western Australia) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) deplores the abandonment by the Hawke Government of the Fraser Government's $64m five year Bicentennial Water Resources Program; (b) stresses the vital importance for Australia's future of the maximum conservation of our limited water resources; (c) emphasises that the main projects in the program had been indicated by the States as having high priority, advanced planning and preparedness, short lead times for commencement and relatively short construction times; (d) stresses that many of the projects would create both immediacy of useful employment in the construction period and significant long term new job opportunities in new industries dependent on water; (e) focuses attention upon the importance in Western Australia of the following projects: Goldfields Pipeline Rehabilitation Harris Dam Harvey Dam (f) regrets that the Hawke Government has given no indication that it will continue to support the existing National Water Resources Program which is a Federal-State dollar-for-dollar sharing program of great significance to all Australians. Senator COLLARD(Queensland) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) deplores the abandonment by the Hawke Government of the Fraser Government's $640m five year Bicentennial Water Resources Program; (b) stresses the vital importance for Australia's future of the maximum conservation of our limited water resources; (c) emphasises that the main projects in the program had been indicated by the States as having high priority, advanced planning and preparedness, short lead times for commencement and relatively short construction times; (d) stresses that many of the projects would create both immediacy of useful employment in the construction period and significant long term new job opportunities in new industries dependent on water; (e) focuses attention upon the importance in Queensland of the following projects: Dawson River Weir the Macintyre River Weir Awoonga Dam the proposed feasibility study for the diversion of the Northern River systems inland; (f) regrets that the Hawke Government has given no indication that it will continue to support the existing National Water Resources Program which is a Federal-State dollar-for-dollar sharing program of great significance to all Australians. Senator ARCHER(Tasmania) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) deplores the abandonment by the Hawke Government of the Fraser Government's $640 million five year Bicentennial Water Resources Program; (b) stresses the vital importance for Australia's future of the maximum conservation of our limited water resources; (c) emphasises that the main projects in the programme had been indicated by the States as having high priority, advanced planning and preparedness, short lead time for commencement and relatively short construction times; (d) stresses that many of the projects would create both immediacy of useful employment in the construction period and significant long-term new job opportunities in new industries dependent on water; (e) focuses attention upon the importance in Tasmania of the following project: Craigbourne Dam (f) regrets that the Hawke Government has given no indication that it will continue to support the existing National Water Resources Programme which is a Federal-State dollar-for-dollar sharing programme of great significance to all Australians. Notice of Motion Senator HAMER(Victoria) —I give notice that, on the next day of sitting, I shall move: That leave be given to introduce a Bill for an Act to amend section 57 of the Constitution to provide that a dissolution of both Houses of the Parliament shall not take place by reason that the Senate has twice rejected, failed to pass or unacceptably amended a proposed law, if more than three months has elapsed after the Senate so treated that proposed law. Notice of Motion Senator JACK EVANS(Western Australia) —Honourable senators will be disappointed to know that I am not giving notice to criticise the Government for stopping its dammed action. I give notice that, on the next day of sitting, I shall move: That leave be given to introduce a Bill for an Act to amend the Sales Tax ( Exemptions and Classifications) Act 1935 to provide exemption from sales tax of retreaded and recapped tyres. The PRESIDENT —I draw the attention of honourable senators to the presence in the President's gallery of former Senator Don Devitt from Tasmania. I am sure all honourable senators will join me in extending to him a warm welcome on his return to Canberra. Honourable senators-Hear, hear! Senator BUTTON(Victoria-Leader of the Government in the Senate) —Papers are tabled in accordance with the list circulated to honourable senators. With the concurrence of the Senate, I ask that the list be incorporated in Hansard. Leave granted. The list read as follows- 1. Trans-Australia Airlines-Annual Report 1981-82. 2. Financial results of TAA and Ansett Airlines passenger air services on trunk routes and the total operation of passenger air services carried on by the Commission and the Company for 1981-82. 3. Joint Reports of TAA and Ansett on: (1) Consultations on passenger revenue load factors and aircraft utilisation during 1982; (2) Airfare consultation held during 1982. 4. ACT Nominal Defendant-Annual Report 1982. 5. Science and Technology Statement 1982-83-together with a statement by the Minister for Science and Technology. 6. British Nuclear Tests in Australia-Review of Operational Safety Measures and of possible after effects-Report by the Australian Ionising Radiation Advisory Council-together with a statement by the Minister for Home Affairs and Environment. 7. Cairns Section Zoning Plan and the Cormorant Pass Section Zoning Plan-Report by the Great Barrier Reef Marine Park Authority-together with a statement relating to the report by the Minister for Home Affairs and Environment. 8. Aboriginal Development Commission-Annual Report 1981-82-pursuant to section 40 of the Aboriginal Development Commission Act. 9. Social Impact of Uranium Mining on Aboriginals in the Northern Territory- November 1982. 10. Commonwealth Schools Commission-Annual Report 1981-82. 11. Australian Industrial Research and Development Incentives Board-Annual Report 1981-82-together with a statement by the Minister for Science and Technology. 12. Commonwealth Task Force on Occupational Superannuation-Final Report January 1983. 13. National Energy Advisory Committee-Annual Report 1981-82. 14. Testamentary Guardianship in the A.C.T.-Human Rights Commission Report. 15. Operation of the Bankruptcy Act 1966-Annual Report 1981-82-pursuant to Section 314 of the Bankruptcy Act 1966. Reports Senator PETER RAE(Tasmania)(11.47) —I move: That the Senate take note of the papers. I do not think that the report of Trans Australia Airlines should pass without comment. I simply draw attention to two major features. One is that the Government has, I believe, quite properly increased the actual capital of TAA to enable its capital base and, therefore, its gearing ratio to be more appropriate to an operation of a commercial undertaking so that its figures are not likely to be, I hope, as disastrous as those disclosed in the report which has been tabled today. In fairness to TAA, it should be made abundantly clear at the start that one of the major reasons for the disastrous figures which are disclosed-whether it be a deficit of about $500,000 or just under, or whether it be what the Auditor-General says, something approaching $7m; a matter I will come to shortly-is the fact that the gearing ratio of Trans Australia Airlines is a huge amount of debt and very little capital. When there is a huge gearing ratio, the exposure to debt and, therefore, to interest rates must leave one in a position where the results appear, in comparison with a company which is geared on a private sector basis, to be extremely bad indeed. The second point is that, notwithstanding that fact, the results must cause alarm to everyone who is interested in the operation of the airlines in Australia and in an efficient system of air transport for this country. The results also include the fact that the Auditor-General has drawn attention to something to which I have attempted to draw attention over the years. I am delighted that the Auditor-General has now supported what I have said; that is, that it is quite wrong to capitalise interest and pretend that one cannot disclose that interest payment as an operating cost and, therefore, improve one' s results. According to the Auditor-General, what has happened as far as TAA is concerned, is that subject to the period about which I am talking being to 30 June 1982 TAA after about 36 years of operation had a market capitalisation of just under $30m . If its accounts were restructured, as the Auditor-General says they ought to be, that market capitalisation would be reduced by $23m, leaving TAA, our major public enterprise in the air transport sector other than Qantas Airways Ltd-that is, our major domestic airline-with a market capitalisation of about $7m net after 36 years of existence. That must be a cause for alarm to a lot of people who would like to see public sector enterprises successful in this country. It must be a cause of some satisfaction to those who would like to see public sector enterprises shown to be unsuccessful in this country. The point I make in briefly speaking to the report is that I believe what is going on is a cause for considerable concern and for some debate in this chamber . I started making the point, in fairness, that TAA cannot be taken on a strict comparison basis with its competitor but it is a matter which ought not to be ignored by the chamber in considering the report. I therefore seek leave to continue my remarks later. Leave granted; debate adjourned. Report and Ministerial Statement Senator CHANEY(Western Australia-Leader of the Opposition)(11.53) —I move: That the Senate take note of the paper and the statement. I welcome the fact that they are tabled. Senator MACKLIN(Queensland)(11.54) —This paper and statement by the Minister for Science and Technology (Mr Barry Jones) I think would leave anybody who has had an interest in this area with serious disquiet. In May 1980 the previous Government conceded that a number of Aboriginals had moved unhindered through the test area. We also know that the area was not fenced until 1979. I think the types of statements that have been made in relation to this paper border on the absurd. We have from the Aboriginals themselves fairly comprehensive information on their movements. We know, for example, that the various warning signs in English that were placed at the test sites were not heeded by the Aboriginal people. By that stage Aboriginals had taken very little notice of those types of warning signs from whites anyhow-they were possibly seen as another interference with their normal activities. We also know that a fairly large band of radioactive fall-out passed across Australia and went out to sea over Rockhampton, in my own State. In that area of northern Australia large numbers of Aboriginal groups are moving about and it would not be possible to say whether they had been contaminated. Since that time many groups have been discovered in that area camping in craters. Until recently no study of the Aboriginal people was actually undertaken, not only those who were affected by the Maralinga tests but also those who were affected by Totem 1 and Totem 2 at the Emu field in 1953. I would suggest that if, in fact, we are about to see another whitewash in this area it will give cause for alarm, not only to those people in Australia who are extremely concerned about the effects of uranium on the total Australian population, but also to those of us who are extremely concerned about the offhanded way that governments have constantly dealt with the Aboriginal people. I hope that in this regard we are not about to see a new government fall into the types of brush-off and whitewash tactics that have appeared in this area whenever Aboriginal people are concerned. Debate (on motion by Senator Martin) adjourned. Report and Ministerial Statement Senator MARTIN(Queensland)(11.56) —I move: That the Senate take note of the paper and the statement. The Cormorant Pass and Cairns sections of the Great Barrier Reef Marine Park were proclaimed on 21 October 1981 and 19 November 1981 respectively. These sections cover an area of approximately 36,000 square kilometres. This is a very important step forward in the declaration of the entire Barrier Reef as a marine park, a step which is welcomed, particularly by Queenslanders and also by Australians generally. The Great Barrier Reef Marine Park Authority advertised in December 1981, following the proclamations of these two areas, its intention to prepare zoning plans for the Cairns and Cormorant Pass sections and called for public representations in connection with the proposed plans. Some 200 representations were received and the Authority, I believe, indicated that those representations , particularly on the subject of how the public uses the various reefs in the sections, were of a very high quality. Two-thirds of the representations came from areas adjacent to the Cairns section, indicating a high level of local involvement in planning the marine area. The Authority took these public representations into consideration and developed zoning plans for the Cairns and Cormorant Pass sections. The draft zoning plans were released for public review on 7 September 1982 and Authority staff were subsequently engaged in an active public participation program. The receipt of representations closed at the end of 1982. After this program closed, the plans were revised by the Marine Park Authority and are the ones tabled in the Senate today. I mention all those events and dates to point out the level and extent of consultation that has gone into every area of the zoning of different parts of the Marine Park. The Authority indicated that it has received throughout assistance from the Queensland Government agencies in the development of the zoning plans. In 1982 the Great Barrier Reef Ministerial Council requested the Marine Park Authority, in consultation with Queensland Government officers, to recommend a timetable for declaration of future sections of the Great Barrier Reef Marine Park. In the 1982-83 Budget and subsequently in the Parliament the Fraser Government announced its intention to accelerate the declaration of sections of the Marine Park. The Ministerial Council has agreed that the declaration of the Great Barrier Reef Marine Park also should be accelerated. The major areas of the Great Barrier Reef region not already in the Marine Park are the Whitsunday area, the Townsville area and the far north area. Debate interrupted. Motion (by Senator Peter Baume)-by leave-agreed to: That consideration of papers 8 to 15 be made an order of the day for the next Thursday on which General Business is called on. Senator MESSNER —I refer the Minister representing the Treasurer to questions that were asked yesterday by the Opposition about the alleged size of the deficit for 1983-84. Will he release the revised forecast figures and stop deceiving not only his back bench but also the public about the alleged size of next year's deficit? Senator WALSH —As I understand it, there is no revised forecast. The Treasury is currently preparing a revised forecast. I will ask the Treasurer to make that available when it is complete, noting as I do so that the practice under the previous Government was not to release any Treasury forecasts whatsoever. Apparently the attitude of the Liberal Party to that policy matter has changed since it moved into Opposition. I can advise the Senate of some facts, as distinct from what the discredited former Treasurer has been saying about this matter, relevant to both the 6 March Treasury estimate and the National Economic Summit Conference scenario A. There was no gross domestic product growth assumption per se in the 6 March estimate. There was a forecast that total employment would fall by one per cent on average during the year, which led some people to conclude that there was an implicit forecast of GDP growth of 0.5 per cent, the reason for the discrepancy being an assumed productivity growth of 1.5 per cent. In fact Mr Stone has since stated, the Treasurer has stated this in the House, that the GDP assumption underlying the 6 March paper was 1.5 per cent real GDP growth on average-in other words, an implicit productivity gain of 2.5 per cent. Some people may think this is high but in times of labour shedding at the margin one would expect the productivity growth rate to be somewhat higher than normal. Last week the discredited former Treasurer said that the forecast real GDP growth rate had increased from 0.5 per cent to 4.1 per cent. He was wrong at both ends, because the growth rate assumed in the 6 March statement was 1.5 per cent and the latest estimate which came from a revision of scenario A is for a year-on-year growth of 3.1 per cent. So the appropriate figures to use in the context in which the discredited former Treasurer used figures last week would be a revision from 1.5 per cent on 6 March to 3.1 per cent-not 0.5 per cent to 4 .1 per cent, as he stated. It appears that, unlike Senator Messner, the discredited former Treasurer cannot understand the difference between a June-on- June growth rate and a year-on-year growth rate. As anyone who knows the slightest thing about these matters-Senator Messner is one of the few people in the Liberal Party who do-would know for the purposes of assessing effect on Commonwealth revenue the year-on-year figure is relevant. It is no surprise, perhaps, that the former Treasurer does not understand the significance for Commonwealth revenue purposes of a year-on-year or June-on-June figure, given the dreadful mess in which he left the Country Party-the country's finances. Honourable senators interjecting- Senator WALSH —If honourable senators want to talk about the National Party finances in Western Australia I would give them a dissertation on that too. Given the dreadful mess in which the former Treasurer left the country's finances when he was ignominiously kicked out of office on 5 March, it is no surprise. Over and above the errors which the discredited former Treasurer has committed in making the assertions that he did, there is another very important matter of government revenue in relation to next year. A good deal of the anticipated additional growth arises from the agricultural sector because the drought has broken. The revenue gains from that will not be received in 1983-84, but in 1984 -85. I see that Senator Messner is nodding his head. That means he understands that little complexity too. It is a pity Mr Howard did not share his insight into these matters. A good deal of the potential revenue, even from the non-farm sector, gained from a higher growth rate will be deferred into the next financial year. I commend to the discredited former Treasurer a perusal of an article written by his former adviser, Mr John Hewson, and published in the Business Review Weekly last week, which deals with some of those matters. With respect to scenario A the assumed year-on-year gross domestic product growth rate was 2.7 per cent. I understand that Dr Hughes and Dr Garnaut, at the briefing provided for the Press on 19 May, said that they believed that growth rate has now increased to something slightly above 3 per cent-3.1 per cent at the highest. So the difference between scenario A and what Drs Hughes and Garnaut said at the 19 May briefing is at most a 0.4 per cent greater increase in GDP in a normal year. A broadly based GDP of that magnitude will increase government revenue by about $200m. Given that a great deal of that increase is not broadly based but originates from the agricultural sector and stockholdings, the actual gain to revenue will be considerably less than that. So although there has been some change because of new facts which have arisen, since both scenario A and the 6 March statement, it is a reasonable expectation that the $9.6 billion deficit forecast by Treasury for next financial year-other things being equal-will now be somewhat less than that. Essentially, however, it makes absolutely no difference to this point: The former Treasurer was told four days before the election that the deficit would be between $9 billion and $10 billion; on the day before the election he was told it would be $9.6 billion. Senator Chaney —Mr President, I raise a point of order. A good deal of the information provided by the Minister has been factual. I have not intervened, although the answer has run for about seven minutes. However he is now clearly commencing to debate the matter and I ask you to draw his attention to Standing Order 100. I have not intervened before. The PRESIDENT —I have listened closely to what the Minister has been saying. Up to this stage he has been replying to the question, but I suggest he is now starting to bring in Standing Order 100. I ask him to bring his answer to a close. Senator WALSH —I was about to do that. I apologise for the length of the answer but there is a good deal of information required by the question and it is necessary to explain the answer in some detail so that Senator Messner understands it, although it is doubtful whether anybody else on the Opposition side does. The essential point remains unchanged: The former Treasurer was told the facts a week before the election. He went to the then Prime Minister and said: 'Will we tell the public about this?' The then Prime Minister said: 'No, don't tell them anything. Continue to deceive them as you have been doing for the last couple of months. Keep them in the dark. Give them the mushroom treatment'. The former Treasurer did exactly that. Senator Messner —Mr President, might I ask the honourable senator if he could assist us-- The PRESIDENT —Order! Is this a supplementary question? Senator Messner —I merely want to ask-- The PRESIDENT —Is it a supplementary question-yes or no? Senator Messner —I wish to ask a supplementary question, Mr President. The PRESIDENT —I will permit the honourable senator to ask a supplementary question. Senator MESSNER —All I want to ask is whether the Minister will assist our education by tabling all the documents from which he quoted. Senator WALSH —I will certainly do that. I have two pages, Mr President, in my own handwriting. I note while tabling them that to achieve a $6 billion Budget deficit, which was what the-- The PRESIDENT —Order! The Minister has been asked merely to table the papers, not to make any comment. Senator REYNOLDS —Is the Minister representing the Minister for Housing and Construction aware that the $9.3m made available by the previous Government for the Mortgage and Rent Relief Scheme has so far not been utilised in Queensland? As such funds have made a vital impact in regard to housing assistance for families in other States, can the Minister indicate whether any of that $9.3m is still available for the Queensland Government to give vital housing assistance? What options are there to release those funds to community based housing schemes in Queensland if the State Government does not accept responsibility for the administration of this important Federal housing assistance scheme? Senator GRIMES —In answer to the first part of Senator Reynolds's question, I am aware that the Queensland Government has so far not agreed to participate in the Mortgage and Rent Relief Scheme. The Queensland Government seems to care little about the low income earners and disadvantaged people who are having housing difficulties in that State. It is more concerned to flog off sections of the State, particularly the coastline and the mineral resources, to foreign companies for whatever assistance they might give to the Queensland Government. With regard to the second part of the question, the Commonwealth's offer to the States-that is the offer of the previous Government-was to provide up to $20m a year for each of the three years from 1982-83 to 1984-85. The Queensland Government's 1982-83 provision which, from memory, was about $3.1m, will no longer be available to that State. However, the option is still available for the Queensland Government to participate in 1983 and 1984. I am advised that at the recent Housing Ministers Conference, housing Ministers agreed that an urgent review of the guidelines for the scheme would be carried out and that this review would look at a range of options, including the possibility of permitting funds to be made available to support community-based housing groups for low income rent payers or for homeless persons, as Senator Reynolds suggested. I am informed that the Queensland Government is currently reviewing its previous decision not to participate in this scheme. I certainly agree, as does the Government, that low income earners, rent payers and homeless people in Queensland should be able to benefit from Commonwealth schemes, but unfortunately the Queensland Government, as it does so often, refuses to take part in those schemes, particularly when they involve the very disadvantaged citizens in that State. I only hope that the Queensland Government will see the difficulties facing these people, take a look at the very long waiting list for public housing in that State, and realise that these citizens of Queensland are as deserving of similar preferential treatment to that which the Queensland Government seems desirous of giving to various foreign companies that wish to move into that State and take over its resources and land. Senator ARCHER —I address my question to the Minister for Resources and Energy. Having read the Hansard report of the debates last night, I found that Senator Cook made it clear in his speech that he thought that the Minister's favourite, but now discredited, projected deficit figure of $9.6 billion applied to the current financial year. As not even Senator Walsh has made such an extravagant claim, will he arrange an educational exercise for Government back benchers- Senator Cook in particular-so that if they insist on using this spurious figure, they will at least know to which year it refers? Senator WALSH —I have not read Hansard this morning and I do not know what- Senator Walters —It is a pity. Senator WALSH —One thing that would deter anybody from reading Hansard is the quantity which Senator Walters contributes to it-and the quality. I have not read Hansard, I do not know what is recorded therein and I did not hear Senator Cook's speech. He can speak for himself later if he cares to make a personal explanation. It is, however, entirely possible that Senator Cook or anyone else could have mistakenly said 1982-83 when he meant 1983-84. I can assure Senator Archer that Senator Cook is highly literate in these matters. I commend to members of the Opposition the undertaking of a self-education course in these questions similar to that which Senator Cook has undertaken. I might add, given the continuing interest of members of the Opposition in deficit projections, that to achieve the $6 billion 1983-84 deficit which Mr Howard was claiming would have been achieved in 1983-84 had the previous Government remained in office, it would have been necessary, given no change in expenditure programs, for a real gross domestic product growth rate of almost 9 per cent to have been achieved in that year. The former Treasurer is implicitly claiming, when he says that the previous Government would have got the deficit- Senator Chaney —I rise on the same point of order, Mr President. Clearly the question is being debated again. Indeed, matters far wider than the question are being debated. The question related to Senator Cook's statement yesterday that the $9.6 billion figure used by the Opposition related to the current financial year, which was clearly in error. The PRESIDENT —I ask the Minister to bear in mind Standing Order 100 when he is replying to the question. Senator WALSH —Certainly, Mr President. I was almost finished. I just say for the sake of the record that to achieve what the former Government said it would achieve required either an expenditure slash of $3.5 billion or a real GDP growth rate next year, on average, of 9 per cent. People can draw their own conclusions as to the degree of credibility which Mr Howard now has in these matters. Senator MAGUIRE —Has the Attorney-General seen the recent comment in the Age newspaper by Professor Finlay of Monash University that the legal and ethical questions raised by in vitro fertilisation could be resolved more quickly if, instead of the five separate State inquiries now being conducted, the Federal Government established a national committee? What is the Commonwealth's role in this matter? What are the implications of in vitro fertilisation for laws governing the status of children, including inheritance? Senator GARETH EVANS —I have seen Professor Finlay's article in the Melbourne Age . The situation is as follows: Inquiries into in vitro fertilisation are presently being undertaken in three Australian States-New South Wales, Victoria and Queensland-and also outside Australia, to our knowledge, in Ontario and Great Britain. The Standing Committee of Attorneys-General would appear to be the most effective available body for the consideration and co-ordination of the State reports and I propose to ensure that the matter continues to be raised before that forum. To the extent that the Standing Committee so operates it would appear to be unnecessary for the Commonwealth to set up an additional inquiry of its own, but that is certainly a question that I will keep under review if other forms of co-ordinating activity break down. At present the Standing Committee of Attorneys-General is considering this matter to the extent that it is looking at a draft model Bill produced by New South Wales which deals with artificial insemination by donor and in vitro fertilisation where donor material is used. This Bill deals only with the determination of the relationship of father and child, although it recognises the possibility of ovum donation and surrogate motherhood. It does not deal with the issue of who is the mother in such a situation. In the AID and IVF situations with which this model Bill deals, it is proposed that the status situation be resolved by severing the legal link with the donor. Insofar as IVF involves no donor genetic material, no issues as to the status of the resulting child are raised, because in law such a child is of no different status from a child naturally conceived. However, there is a question in relation to children born as a result of medical techniques using donor genetic material, who have not had their status dealt with adequately. As I have said, the draft model legislation is directed to this area. As to the effect on inheritance laws, inevitably there would be some effect of the kind of legislation that I have talked about as it would result in some children being more completely regarded as children of the families into which they have been born. The draft model Bill will overcome difficulties which are presently being experienced in that area. As I have said, the Commonwealth's role at the moment is, I perceive, a relatively limited one, that is, assisting in the co-ordination of this reporting activity that is now going on and certainly legislating for the Australian Capital Territory when the time arrives to do so. Let me mention one remaining aspect of the Commonwealth's role, and that concerns the Family Law Amendment Bill which will be introduced later today. The Bill contains a provision allowing an AID or IVF child to be treated in all respects as a child of the marriage for the purpose in that respect-- Senator Durack —It is exactly the same as the previous Bill, is it? Senator GARETH EVANS —Yes. Senator Durack will be delighted to find that his product lingers on in that respect even if his memory in other ways is becoming rapidly diminished. To that extent-and it is only to that extent-the Family Law Act will deal with this vexed and controversial question. The Family Law Amendment Bill provision which is proposed in this respect is not in any way designed to deal with these basic questions of status which do remain to be resolved. Senator Chaney —I ask the Minister to table the document from which he quoted. Senator GARETH EVANS —I table the document. Senator MACKLIN —My question is addressed to the Minister for Resources and Energy, presumably in his capacity as the Minister representing the Minister for Trade. Can the Minister confirm that the Government has granted special licences to Energy Resources of Australia Ltd and Queensland Mines Ltd to negotiate new uranium export contracts? Can he confirm that a spokesperson for the Deputy Prime Minister and Minister for Trade, Mr Bowen, stated that several companies had applied for and been granted new licences? Can the Minister explain the apparent contradiction between the granting of new uranium export licences and Australian Labor Party policy which allegedly purports to stand for the phasing- out of Australia's uranium mining industry as from July 1982? Can the Minister also inform the Senate whether the granting of these special licences means that the Government has decided on its uranium policy and has completed its review of licences following Mr Bowen's suspension of negotiating rights for uranium mining companies? Senator WALSH —In regard to the first part of Senator Macklin's question-this is subject to checking-I believe that the Minister for Trade put out a Press statement on this subject a couple of weeks ago, although the date is a bit uncertain. I believe that that statement-again, this is subject to checking- indicated that the negotiating licences for exports which he had formerly cancelled had, to some degree at least, been renewed. I will see that a copy of that Press statement and whatever the Minister for Trade feels inclined to add to it are supplied to Senator Macklin. In regard to the second part of the honourable senator's question-he asked whether the Government has completed its review of these matters-the answer is no. They are still under review. At this stage I cannot forecast when the review will be completed. Senator MACKLIN —Mr President, I ask a supplementary question. My reference was to the article in this morning's Sydney Morning Herald which spoke of new uranium export contracts. Is it the case that the Government has granted new uranium export contracts and has not merely renegotiated the old ones? Senator WALSH —I do not think I can add anything to what I said before. I will refer the question to the Minister for Trade for clarification. The Government is examining all aspects of its uranium policy. The two existing uranium producers have been authorised to resume negotiations with certain electric power utilities in the United States to enable them to maintain a market presence there pending the outcome of the policy evaluation. I will inform Senator Macklin as soon as possible of any additional comment or clarification which the Minister wishes to supply. Senator BOLKUS —I refer the Minister representing the Minister for Communications to Press reports this week which indicated that the Special Broadcasting Service would this year be incorporated into the Australian Broadcasting Corporation. Can the Minister indicate whether that is the case? I also refer the Minister to an answer I received from him last week to a question on notice in respect of the extension of Channel 0-28 to Adelaide. Did the Minister state in his answer that the extension of multicultural television in this way was under review in the budgetary context? Despite this, can he give an assurance that Channel 0-28 will be extended to Adelaide in the next financial year, as planned? Senator BUTTON —The question of a possible merger between the Australian Broadcasting Corporation, as it will be, and the SBS, which incorporates multicultural television and ethnic radio broadcasting, has been, quite appropriately, on the agenda of political debate for some time, and I think it will remain there. It was on the agenda of political debate in 1981 at the national conference of the Liberal Party, at which a motion proposing the merger of the SBS and the Australian Broadcasting Commission was defeated by two votes out of the 48 or 49 people present. So it has been on the agenda of political debate in all political parties. Having said that, and having said that I think it should remain there, I say that it is not the intention of the Government to merge the Australian Broadcasting Corporation and the Special Broadcasting Service. The Government's policy, announced prior to the election, is to provide a viable and vigorous ethnic and multicultural broadcasting system. In our pre-election policy we enunciated a number of matters which we thought would lead to a much more independent and vigorous ethnic and multicultural broadcasting system in Australia. That policy will be implemented in due course. The Government is not convinced at the moment that Channel 0-28 or the ethnic broadcasting services are necessarily fulfilling the most effective role which they could fulfil. Those matters must be subject to continual examination. But I repeat that in terms of Government policy there is no intention to merge the SBS with the Australian Broadcasting Corporation. The second part of the question related to the extension of Channel 0-28 to capital cities other than Sydney and Melbourne, which are the two capital cities which currently receive that service. I said last week in an answer to Senator Bolkus that that matter will be reviewed in the Budget context. I repeat that answer. The only thing I can add is that it is high in the priorities of the Government's communications policy to achieve that extension as quickly as possible. Senator TOWNLEY —My question is directed to the Minister representing the Treasurer. Is it a fact that the Treasurer has acknowledged that the new 'super tax' is payable on the proceeds of superannuation funds paid on death? Will the proceeds of ordinary endowment life assurance policies and/or the proceeds of surrender of whole of life policies, or those paid at death, be taxable under the new arrangements? Senator WALSH —As to the first part of the question, the answer is no, it is not a fact. As I understand it, the Treasurer has stated that that is one of the questions that are under review; that is, the degree, if any, to which a benefit which might otherwise have been transferable-a superannuation lump sum benefit for a deceased person transferable to someone else-will be treated. As to the second question, I understand that it relates just to normal whole of life policies. As I understand it, this is a matter on which no decision has been made. One question on which a decision has been made would have relevance here, and that is that anyone's own contribution, in a more general sense, which has not attracted a taxation concession or a deduction from taxable income when it was contributed, would not be included for tax purposes when received. I shall clarify those matters with the Treasurer. The answers that I have given at this stage are conditional on their being clarified and confirmed by the Treasurer. Senator TOWNLEY —I ask a supplementary question. I realise that it is a fairly technical question to ask the Minister to answer off the cuff. Perhaps he could look through his answer and, if there is any correction or addition, we could have that before the Senate rises tomorrow. We would be grateful, because many people are asking about this matter. Senator WALSH —I am sure that the people in the Treasurer's office will be listening to our proceedings. If they have time and if anything can be added to my answer, I trust that they will make it available at the end of Question Time. Senator ZAKHAROV —My question is addressed to the Minister representing the Special Minister of State. I draw the attention of the Minister to the directions which are sent to applicants for postal votes in Federal elections. The directions relating to authorised witnesses state that they must be: (a) any elector whose name appears on the Roll for a State, for the Australian Capital Territory or for the Northern Territory of Australia; (b) an officer of the Naval, Military or Air Forces of the Commonwealth or of some other part of the Queen's dominions; (c) a person employed in the Public Service of the Commonwealth, a Territory of the Commonwealth or a part of the Queen's dominions; and (d) a Justice of the Peace for, or a Minister of Religion or Medical Practitioner resident in, a Territory of the Commonwealth or a part of the Queen 's dominions. Since Australian voters in the twentieth century frequently travel outside the Queen's dominions, will the Minister institute changes to these directions, which disenfranchise many Australians travelling overseas? Senator GARETH EVANS —Many Australians travelling overseas feel themselves to be disadvantaged by these provisions. It may be that there needs to be some attention to the law in this respect. However, the basic situation is that the witness provisions for postal voting overseas are prescribed in the Commonwealth Electoral Act and it would not be possible for the Special Minister of State to issue directions which extended the scope of those provisions. There would need to be legislative change. It ought to be appreciated, however, that so far as the existing law is concerned, even without any change, any Australian elector can, as was acknowledged in the question, witness an application for a postal vote. Of course, this constitutes in practice a very broad qualification, in that, for example, it would enable a wife to witness her husband's application, and vice versa, while they are travelling, or indeed, any two or more Australians travelling together overseas. So in practice the disadvantage may not be as great, as a practical matter, as at first appears. However, as honourable senators know, the Government and, in particular, the Special Minister of State are giving a great deal of attention to all aspects of the operation of our electoral laws. I shall refer the honourable senator's question to the Special Minister of State for further consideration. It may also be a matter to which the Joint Select Committee on Electoral Reform wishes to give attention. Senator CHANEY —My question is addressed to the Minister for Resources and Energy. It relates to resource rent tax. I remind the Minister that he is on the public record as saying that rent is from time to time a high component of the market price of gold. Does he agree that at present prices there is a substantial rent element in gold mining profits? Does he envisage extending consideration of the resource rent tax to gold? Senator WALSH —I did not know that I was on the record as having said that; but, whether I said it or not, when gold prices are high it is undoubtedly a fact that rent is a high component of the market price for some gold mines but not necessarily for all gold mines. The answer to the question is that there is no plan at this stage anyway-that does not imply anything about the future-to impose an RRT on gold. The only minerals which I have identified as being in need of a change to that form of taxation are crude oil and export quality coal. Senator CHANEY —Mr President, I wish to ask a supplementary question. If there is a rent element in some gold mining profits why does the Minister make the distinction between that rent element and the rent element which he says exists with respect to some coal mines? Senator WALSH —The taxation laws for, I think, the last 60 years have discriminated between the treatment of gold and other mineral production. If Senator Chaney is asking for a rationale for a policy of applying an RRT to some minerals and not to gold, I suppose in one sense one could argue that there can be no rationale, except for the historical fact that for the last 60 years there has been a distinction with respect to company and, I think, even personal income tax. So the reason for doing the one is as good as the reason for doing the other. For about three-quarters of the 60 years during which gold has been treated differently for the purpose of company taxation Liberal and Country Party governments have been in office. Apparently they did not see too much wrong with that. Senator SIBRAA —Is the Minister representing the Minister for Sport, Recreation and Tourism aware of reports in this morning's newspapers which indicate that a national travel company, Tour World International Pty Ltd, has collapsed? This company, which is one of Australia's biggest travel retailers, is based in Melbourne but has offices in Sydney, Brisbane, Perth and Adelaide and has an annual turnover of approximately $50m. Is the Minister aware that airlines and Australian travellers will lose hundreds of thousands of dollars if the organisation cannot trade out of its difficulties? In view of these facts, will the Government urgently examine the need for legislation for the registration of all travel agents in Australia-something that should have been done by the previous Government? Senator RYAN —The Minister for Sport, Recreation and Tourism is aware of the matter raised in Senator Sibraa's question and has provided me with some information on this matter. The Government is very concerned by the failure of travel agents, the impact this has on the community at large and the real suffering it brings to people directly involved. The Government's position is very clear in relation to the licensing of travel agents. This is set down in a document 'The Future of Tourism in Australia-a Labor View' by the Minister for Sport, Recreation and Tourism. With regard to travel agents it states that the Government will: 1. encourage the States to introduce uniform legislation for the registration of all travel agents in Australia. 2. introduce a 'model' registration for travel agents in the ACT on which other State legislation can be based. The matter of the licensing of travel agents was discussed at the Tourist Ministers Council which met last Friday in Sydney. The Council decided that a working group should be established to produce draft provisions which could be adopted by States and Territories for any proposed travel agents licensing legislation. The Council agreed to approach Ministers for consumer affairs and the relevant industry groups concerning the formation of the working group. So the episode referred to in Senator Sibraa's question should be dealt with satisfactorily in terms of the legislative intentions of the Government. Senator HILL —My question is directed to the Minister for Resources and Energy. It follows his ambiguous answer to Senator Messner last week concerning future contracts for the sale of uranium and his answer to Senator Macklin today that the Government is reviewing its whole policy in the area. In the meantime, what companies is the Government prepared to allow to proceed with the negotiation of contracts? Are negotiations to be at the price established by the previous Government? When does he anticipate that this complete review will be completed? Senator WALSH —I do not think I can add very much to what I said earlier. I said that my recollection was that a few weeks ago the Minister for Trade had issued a Press statement relevant to this matter and that I would check that and supply an answer to Senator Macklin. With regard to the second part of the question- when the review will be completed-I have already said that I am not in a position to put a date on that. I will refer the question from Senator Hill, along with the others, to Mr Bowen to see whether he has anything to add. Senator PRIMMER —My question is directed to the Leader of the Government in the Senate. What will be the effect on the rural sector of the May economic statement? Is it true as claimed by some members of the Opposition, particularly Mr Anthony, that the rural community will be badly disadvantaged by the May statement? Senator BUTTON —A number of wild claims have been made about the effect of the May economic statement on the rural sector-or, to use a wider expression than ' rural sector', non-metropolitan Australia. The rural community has not been singled out to carry a disproportionate share of the fiscal restraint which was outlined in the May statement. Indeed, rural communities will share perhaps even more than other Australians in the benefits which will ultimately be derived from the May statement in the form of moderation of interest rates and cost increases. These things have been of greatest concern to the rural community over a number of years. I point out that a number of the measures which were introduced in the May statement will have a direct impact on primary producers. The major impact will come through the contribution of all the individual measures working together to restore balance and growth to an economy- particularly a rural economy-which has suffered severe difficulties in recent times. A number of specific benefits for rural communities are contained in the May statement. For example, just 10 weeks after the election the Australian Wheat Board was granted the facility to borrow overseas, resulting in the Wheat Board being given much greater flexibility. That could save hundreds of millions of dollars for farmers in the future. Of course, these savings will be passed on to wheat growers. I could give a number of other examples; to single out one, it is a fact that primary producers, unlike other taxpayers, will still be able to claim a full year's depreciation in the year in which plant is purchased. The major impact of the May statement on rural communities will come ultimately with the restoration of balance and growth to the Australian economy. They are the things which the rural community and rural organisations have been complaining about for many years. A strengthening of the domestic economy in Australia is of advantage to every rural producer. I must say that both before the May economic statement and since the Government has had quite detailed discussions with representatives of farm and rural organisations, who do not make the claims which have been made by people such as Mr Anthony, that the rural sector has been singled out in a disadvantageous way from other sectors of the community; there is widespread recognition that all sectors of the community had to share in the constraints which arose from the May economic statement. That is recognised by rural organisations and this recognition has been conveyed to members of the Government in discussions which have been held since the statement was made. Senator MASON —I ask the Minister representing the Minister for Aboriginal Affairs whether the Government is aware of statements in the 23 May issue of Newsweek magazine in an article on Aboriginal land rights, which states: In many parts of rural Australia 'shoot-em-up' is a favourite weekend sport. The rules are simple. Drunken whites ride through country towns firing random gunshots in Aboriginal neighbourhoods. The Aborigines may be killed . . . but few whites go to gaol. In view of the large international circulation of Newsweek and its general reputation for accuracy, I ask that an investigation of these allegations be carried out. I ask the Minister to establish whether the allegations have any basis in fact. If they have, will she see that appropriate action is taken? If they have not, will she find out why they were made and do all she can to see that Newsweek corrects the situation? Senator RYAN —I saw the article in Newsweek to which Senator Mason's question referred. Whilst I would say, and I express here the view of the Minister for Aboriginal Affairs, Clyde Holding, that the stories were alarmist, there is no doubt that some aspects of the stories reflect the extraordinary circumstances of discrimination under which Aboriginal Australians live and the violence to which they are subjected from time to time. The Minister for Aboriginal Affairs, Clyde Holding, has informed me that the particular allegation concerning weekend parties going out to shoot Aboriginals is untrue. I do not know what investigations he has undertaken to ascertain that, and I will refer that aspect of Senator Mason's question to him. All honourable senators will be aware that violence of this kind is something from which Aboriginal Australians are not free. Honourable senators will be aware of the tragic episode in Moree last year, although it was an isolated incident as the publicity it attracted demonstrated. The Government certainly would not claim that there is a complete absence of racial discrimination in rural Australia. On the other hand, we believe it is going beyond fair and accurate reporting to suggest that the occurrences described in Newsweek are a normal part of life in Australia. The Government's intention is to take as many effective steps as possible to eliminate discrimination, both through strengthening the operation of the Racial Discrimination Act, which was a Whitlam Government initiative, and through co- operation and consultation with Aboriginal people throughout Australia to ensure that the social and economic circumstances of Aboriginal people are improved so that the basis for the kind of prejudiced behaviour that gives rise to these outbursts of violence can be eliminated. I will refer Senator Mason's question, specifically that part with regard to investigation of the allegations in the Newsweek article, to Mr Holding. I will also carry to him the suggestion implied in Senator Mason's question that any false allegations in Newsweek ought to be corrected. Senator GILES —Can the Minister representing the Minister for Finance advise the Senate of the effect on the personal income tax obligations of ordinary wage and salary earners of the loss of $200m in government revenue from other sources in 1983-84? Senator WALSH —If the Government lost a couple of hundred million in revenue and had to recover it from some other source, not only in 1983-84 but also, I suppose, in any year, the magnitude of the changes that would have to be made- these are single alternatives that I am putting and not a group-would involve an average rise in income tax of nearly $1 a week. Of course, for many households with more than one income earner it would be more than $1. Alternatively, there could be a 7 per cent increase in sales tax collections, which would add about 0 .25 per cent to the consumer price index. If the adjustment were to be made on the expenditure side, for example, $200m represents approximately 30 per cent of the amount of total Commonwealth payments to Tasmania. I am not sure of the proportion it represents of payments to other States. That is an indication of the sorts of alternatives which would be available to a government if that revenue were lost for whatever reason. I suppose that I should add one other alternative; that is, it could be added to whatever Budget deficit would otherwise apply. Senator MISSEN —I refer the Attorney-General to his Press statement of 24 May relating to changes to the Freedom of Information Act, and remind him of his and the Government's firm election commitment which stated: Labor will implement fully the outstanding recommendations of the Senate Standing Committee on Constitutional and Legal Affairs to ensure that freedom of information operates in practice as well as in name. I ask the Attorney-General: First, does not his statement of 24 May omit the major recommendations of the Senate Committee relating to conclusive certificates and to the increased use of the Commonwealth Ombudsman? Secondly, will the Government honour its pre-election and subsequent undertakings to eliminate the iniquitous system of conclusive certificates which allows Ministers to arrogate to themselves unappealable powers to prevent the release of certain classes of documents? Thirdly, will major amendments be made to the Act, as recommended by the Senate Committee, to provide for an effective involvement of the Ombudsman in the practical utilisation of freedom of information? Senator GARETH EVANS —When Senator Missen reads the Bill to be introduced tomorrow, of which I gave notice today, he will, I think, be not quite so disappointed as he sounds at the moment about the reach and scope of that Bill, which contains some references and makes some substantial improvements to the present system which obtains in relation to conclusive certificates and gives certain clarification and minor extension to the role of the Ombudsman. I have readily acknowledged publicly that sometimes there is a gap between aspiration and achievement when it comes to the implementation-- Senator Durack —What about your promises, too? There seems to be a gap between that and your promises. Senator GARETH EVANS —There was neither aspiration nor achievement in Senator Durack's case. I think he has very little to be proud of in his record. The PRESIDENT —Order! I suggest that the Attorney-General answer Senator Missen' s question. Senator GARETH EVANS —I think the question would be better directed to me during the debate on the Bill, which Bill is a substantial one and makes a great many improvements to the scope and operation of the Freedom of Information Act, based overwhelmingly on the report of the Senate Standing Committee on Constitutional and Legal Affairs, of which Senator Missen and I were both members. The Government and I share the honourable senator's commitment to effective freedom of information legislation. I am sure that the legislation will be very substantially improved by the character of the amendments which are coming forward. Senator MISSEN —Mr President, I ask a supplementary question. I am aware of what is in the statement of the Attorney and that the Bill will not contain these items. Cannot the Attorney admit that the Government is not now going to carry out its election undertaking to implement the Senate Committee's recommendations ? Senator GARETH EVANS —I repeat that the Bill coming forward will not quite meet that aspiration in every respect, two significant respects being conclusive certificates and the role of the Ombudsman. There is no secret about that, because I identified those two particular matters in the Press statement to which the honourable senator referred. There is no attempt to duck or weave on this issue. It is simply a matter of saying that there are many things one would like to do that, for one reason or another, do not always prove possible to achieve all at once. Senator TATE —My question is directed to the Minister for Social Security. Is it a fact that the supporting parent's benefit can be paid by the Department of Social Security to a mother who lives abroad with her child? Is it a fact that a number of women, including but not confined to New Zealanders, abuse this provision by giving birth to their child in Australia and then returning to New Zealand or to their home country, where the Australian taxpayer continues financial support for many years? Will the Government consider taking firm steps to halt this practice, which not only drains away much needed dollars from our own social security system but, I believe, also badly sours some aspects of our relations with the home countries of these women? Senator GRIMES —Senator Tate is correct in saying that the supporting parent's benefit is, in fact, portable to any country in the world. As he has mentioned in particular New Zealand, which has been the subject of questions in this place at other times, I think it is important to point out that the benefit is payable in New Zealand, and that rumours periodically go round the community that apparently a large number of New Zealand women are abusing this facility. To put the matter into perspective, I should point out that about 2.6 million pensions and benefits are paid by this country each year. Of that total, only 17,000 are paid as portable pensions overseas and only 157 supporting parent's benefits are paid to women who are living in New Zealand. As frequently an associated rumour is that about pensions paid to women in Fiji, I say that only 161 such pensions are paid in the whole of Oceania. At various times attacks are made on the portability provisions of the social security legislation which, as most honourable senators know, were introduced in 1973 and were continued throughout the life of the previous Government. This Government agrees with the provision of portability. Senator Tate —What about contrived cases? Senator GRIMES —I have answered the question by pointing out that one could hardly describe the payment of 157 supporting parent's benefits to people living in New Zealand as representing an enormous drain on the Australian taxpayer and an abuse of the Australian Treasury. I put it to honourable senators that the stories that go round about New Zealand women are just not borne out by the facts. That has been pointed out by not only me but also previous Ministers for Social Security. However, I am aware that New Zealand does not provide such portability for this group of people. Australia will be renegotiating the reciprocal agreement on social security between Australia and New Zealand and that is a matter that we will have to discuss. There will always be people who will try to take advantage of the social security provisions. I merely wish to point out that if, amongst those 157 to whom the supporting parent's benefit is paid, there are some who are abusing those provisions, the way to overcome that is to review the situation carefully, in the light particularly of negotiations with the New Zealand Government, to ensure that people on either side of the Tasman do not abuse the social security system of either country. Therefore, we will continue to take a close look at the matter, which I will be discussing with my New Zealand counterpart when the time comes. Senator MARTIN —My question is addressed to the Minister for Resources and Energy. On Tuesday of last week, in answer to a question asked by Senator Messner, the Minister said that contracts for the supply of uranium had been refused by the former Government because of 'unsatisfactory pricing arrangements '. I ask: Is it a fact that the former Government did not approve a contract that had been entered into by the Pancontinental company because the technical details relating to price review procedures were unsatisfactory? Would the Minister agree that this is a totally separate issue from that of contract prices for an agreed quantity of uranium? Senator WALSH —No, I do not agree. I repeat what I said in the Senate on, I believe, the day mentioned, and what I have said on a number of occasions outside of the Senate. The plain fact is that the former Minister for Trade and Resources, Mr Anthony, declined to approve a provisional contract which had been drawn up, because the pricing arrangements were not satisfactory. That is what happened and that is what I said. Senator ELSTOB —My question, which is directed to the Minister for Education and Youth Affairs, refers to the introduction of computers in schools and the training of teachers in computer instruction. Will the Minister advise what steps are being taken to ensure appropriate computer literacy of teachers? Will the Minister give consideration to encouraging informal participation of parents to overcome the educational gap between students and parents that will exist when school computer studies are fully implemented? Senator RYAN —The Government has announced, and indeed has started to implement, its policy of developing a computer education program for all government secondary schools in Australia and all needy non-government schools. Computer programs already exist in many non-government and some government schools. However, we are very well aware that in implementing a new program of this kind we have to look beyond the actual introduction of the hardware, the computer itself. We must look further than the development of curricula materials and consider very seriously teacher development so that courses will be properly taught and integrated with existing educational courses. We have also to consider community participation to ensure close understanding and support on the part of the school community, particularly the parents, in an innovation of this kind. We are all too aware from past experiences that if innovations of this kind are introduced without the proper teacher preparation and without community and parent appreciation of the purpose of the innovation, the innovation can fail. We are determined that this innovation will not fail because it is very pertinent in terms of the needs of the economy, the future shape of the work force and the role that computers already play in our economy. Because we are determined that we will succeed, we are taking very careful steps in the planning to do what was implied in Senator Elstob's question, and that is to involve teachers and parents in the community and industry representatives in the entire development of this program. A national computer education inquiry is being conducted by the Schools Commission covering all of these matters. I will make available to Senator Elstob all of the details of the committees and the sub-committees so that he can rest assured that the matters touched on in his question have been taken note of by the Government and are being dealt with very carefully. Senator KILGARIFF —My question is directed to the Minister for Resources and Energy. I refer him to his earlier answer to Senator Macklin's question and I ask: Is it a fact that the Australian Labor Party's minimum position in regard to uranium mining is to phase out existing mines and that certain conditions must be applied if existing mines are allowed to continue in operation? What conditions have been imposed on Energy Resources of Australia and Queensland Mines Ltd in regard to their negotiations for new contracts? Senator WALSH —I have answered those questions before. I said that the specific means of implementing the Australian Labor Party's policy are under review and that I will seek from Mr Bowen who handles these matters the details of what is being done in respect of the producers. Senator Kilgariff —I asked what conditions have been imposed. Senator WALSH —I have already said that I cannot answer that here. I will refer that matter to Mr Bowen for an answer. Senator WALSH —I claim your indulgence, Mr President, to clarify or correct an answer I gave to Senator Townley in which I believe I said that no decision had been made on whether the widow, for example-I am not sure whether it is ever applicable to a spouse as potentially distinct from a widow-of a deceased superannuitant who is entitled to the lump sum which would otherwise have been payable to the deceased would be taxed on it. I believe I said that no decision had been made on that matter and that I would clarify it with the Treasurer. I have now been advised by the Treasurer that in those circumstances a widow or spouse, if applicable, who receives a lump sum which was the entitlement of a deceased person would be taxed in the same way as though the lump sum had been received by the deceased person. I am also advised that that was stated on page 61 of attachment B to the 19 May statement. I left for Perth early that day and did not, in fact, receive attachment B on that day. I have not read it since. I attribute my lack of knowledge of the Treasurer having made that statement only to that fact. Senator CHANEY(Western Australia-Leader of the Opposition) —I thank the Minister for Resources and Energy (Senator Walsh) for his correction. So that the record is clear, Senator Townley's question also related to a statement made by Mr Keating yesterday to that effect. I merely wish to confirm that a statement to that effect was made yesterday on AM by Mr Keating. Sitting suspended from 1.4 to 2.15 p.m. Senator COOK(Western Australia) —by leave-At Question Time today, in a question to Senator Walsh, Senator Archer referred to an answer I gave on the projected Budget deficit to several questions by way of interjections from Senators Messner and MacGibbon during my speech last night in the debate on the May economic statement of the Treasurer (Mr Keating). It may be recalled that in my speech last night I said that after the election the Government had discovered that the Budget deficit was in fact in the order of $9.6 billion. Prior to the election the then Treasurer had led the community of Australia to believe that the Budget deficit would be more like $6 billion. Last night the questions, by way of persistent interjection, were: Which year are we talking about? . . . For which year? And later-- Which financial year? . . . Which year? And-- Which year? My answer to the second interjection prompted today's question from Senator Archer. I answered: For the currrent year. Of course I should have said that it was for the end of the 1983-84 financial year, based on projecting the effects of the 1982-83 Budget to that time. If I have misled anyone I apologise but I would have thought that the fact that I made an error of timing would have been clear to Opposition senators because at the relevant passage in my speech I compared the prediction of the Department of the Treasury of $9.6 billion with Mr Howard's prediction of $6 billion for the same period. The fact I strived to point out was that the Treasury had projected a $9.6 billion deficit but Mr Howard had said $6 billion-a fact, since the only question is to year, which I am glad to see is not disputed by the Opposition. I am pleased that Senator Archer asked his question today. I intended to correct the situation when I spoke next but his question has enabled me to make this explanation earlier. Discussion of Matter of Public Importance The DEPUTY PRESIDENT —Mr President has received a letter from Senator Peter Rae proposing that a definite matter of public importance be submitted to the Senate for discussion, namely: The failure of the Minister for Industry and Commerce to take any appropriate steps to overcome those problems of industry which are causing loss of both jobs and investment. I call upon those senators who approve of the proposed discussion to rise in their places. More than the number of senators required by the Standing Orders having risen in their places- Senator PETER RAE(Tasmania)(2.19) —I thank the Senate and I also thank Senator Walsh for so speedily responding to the request made by the Opposition that some steps be taken to educate some members of the Government in relation to economic realities. We have just heard, by way of personal explanation, the first result from that process; but that is not what we are debating today. What we are debating today is a matter which can perhaps be best summed up by a simple question. Where is the Minister for Industry and Commerce (Senator Button)? He is known as the Minister for I Don't Know. Senator Button —Ha, ha! Senator PETER RAE —Senator Button laughs, very appropriately, because that is about what he does in relation to all of the problems which are besetting this country now, as I will demonstrate in a moment. But let me first sum up the Minister's attitude in this way: Hey diddle diddle, The cat and the fiddle, The cow jumped over the moon; The little dog laughed, To see such sport, And the dish ran away with the spoon. Inflation and unemployment are the dish and the spoon, while Senator Button laughs. That is the problem that we have in this country. The Australian in its editorial on 19 May referred to 'the Government's vague economic aims'. It also stated: The Federal Government has baulked at making any real decisions in the economic area and it is time action matched its rhetoric. Let me just quote this well-informed Minister's contribution to the debate which has been taking place in relation to his areas of responsibility. These are matters which may or may not assist in getting Australia back to work, which is his responsibility. On 25 May, in relation to taxation on superannuation payments, he said in answer to a question: I an unaware of any undertakings given by the Prime Minister. When I say I am unaware, I am not denying that undertakings were given; I just do not know. Again, in answer to a question on the same subject that day, he said: . . . I will obtain an answer for the honourable senator in due course on the other aspects of the question. . . . . No Minister is necessarily conversant with all the facts, but I will find them out. This is a Cabinet Minister speaking. On the same day in relation to income tax concessions on health insurance-on this matter apparently the Minister was part of the decision-making process in terms of what this Government is doing to manage the economy of Australia-he said: I am not aware that the pre-election statement was made in that context. He went on to say something further about the housing interest subsidy. In answer to another question, he said: I do not personally recall that pre-election commitment. A little later, in relation to taxation on superannuation payments, he was asked the question: Can the Leader of the Government now tell me, as he was unable to do yesterday, whether the Prime Minister gave a post-election undertaking not to alter taxation of lump sum superannuation payments? The Minister-the Leader of the Government in the Senate and the Minister responsible for getting Australia going again-said: The answer to the first part of the question, I am sorry, is no. He was then asked a further question by his own colleague and my namesake from the other side of the Senate, Senator Robert Ray, on Telecom Australia and starting price betting. The Minister's answer was: I am unaware of any information having been forwarded to the Minister for Communications . . . We hear around the traps the joke that the Minister for Industry and Commerce, whilst neglecting anything to do with industry and commerce, is known as the shadowy Minister for Communications. Further, on 26 May, in relation to income tax rebates on health insurance, he was able to answer Senator Dame Margaret Guilfoyle by saying: I have not yet obtained that information . . . Which was sought. On the same day, he was asked the following question by Senator Watson: Has the memory of the Leader of the Government in the Senate been refreshed to the extent that he can now recall the Government's election commitment to continue the existing tax concession on mortgage interest payments? Senator Button replied: No, not yet. I will try next week. Smart-Alick. The little dog laughed, as we have the problem of the dish running away with the spoon. This is the problem which besets Australia while the Minister laughs as he did when I commenced my remarks today. No doubt he will try to laugh off the real questions which I propose to raise. Let us just have a look at some of the real questions. How was the question of the steel industry dealt with in the economic statement-the much vaunted economic statement? The Leader of the Government in the Senate, the Minister for Industry and Commerce, is one of the leading people involved presumably in its preparation. What did that statement do for industry? I have been through the statement and I have summarised it in this way: The statement referred to transport. It proposed an increase in the price of fuel which will result in higher freight charges. It also proposed an increase in the excise duty on Avgas . These two increases will add next year $25m to the cost of industry which is the area for which his Department is responsible. The decisions announced in the statement are inflationary; they are certainly anti-small business. The Government proposes to cut back on airport development. Decisions taken in the statement will effectively cut out construction of the Alice Springs-Darwin railway and a lot of work in respect of Whyalla about which my colleague Senator Jessop will talk in detail. There again, there was nothing for manufacturing, was there, Mr Minister for Industry and Commerce? What did the Government do in respect of communications? Communications is apparently beloved of our Minister for baiting Dame Leonie Kramer. We have all heard about Button versus Kramer but what have we heard about the communications industry? The economic statement says that the Government will sell 49 per cent of Aussat Pty Ltd if it does not scrap it altogether. It will increase, by $100m , Telecom Australia's contribution to the Government revenues which again could be regarded only as either inflationary and proof that the Government regards it as a milking cow or just inflationary. But it certainly does nothing to assist encouraging manufacturing industry for Telecom expansion. The next heading in the economic statement is 'Other Industry Measures'. What do we find? Firstly we find that the Government has decided to terminate depreciation for fuel storage and fuel conversions. This is another hit at the rural sector and another hit at manufacturing industry. What, did that do in the Minister's area of responsibility? I presume that as a senior Cabinet Minister the honourable senator takes some responsibility for the economic statement. The second point raised was tax take aways for primary producers. Several measures were put forward, but there was certainly nothing for manufacturing industry which relies upon primary producers to buy a lot of its products. The third point that was raised was canning the Bicentennial Water Resources Program. I do not know what that did for manufacturers of machinery and other people who were involved in the manufacturing sector, for which the Minister is responsible. It certainly did not help their sales or their prospects. It did nothing, as the housing proposals did nothing, to encourage anyone to believe that there was anything other than a lessened or diminished prospect of economic activity. Housing proposals were deferred effectively by transfer and diminishment between 1 July and 1 October. Unless the present Western Australian Labor Government's proposal-supported as I understand it by honourable senators on the opposite side of the chamber, who are a bit more far-sighted than this Government-is accepted by the Government something will have to be done to keep the housing industry on its upturn during that period, otherwise there will be a massive downturn and again nothing for manufacturing industry. It is extraordinary that this Minister-a Minister in a senior position responsible for getting Australia and industry and commerce going again-has participated in what amounts to a series of decisions outlined in the economic statement of 19 May which hit below the belt the very people who elected the Government. We are told that the mortgage belt rebelled. The mortgage belt has now been hit below the belt by this Government and this Minister. I will refer to some other aspects of this Minister's behaviour in relation to industry advisory councils. During the period leading up to the election we were told by the Prime Minister, Mr Hawke, that we were to be overcome with a wonderful spirit of consensus. We were to have commitments to use the talents of both parties. On 16 February, Mr Hawke said: The need for national reconciliation, the need for Australians to be brought together and to work together, is something I held as fundamental throughout my public career. Yet what has the Minister done to pursue that ideal? He has suspended the operation of the industry advisory councils, as far as the Opposition is concerned. Senator Button —And the Government. Senator PETER RAE —And Government members. If I may just develop it a little further-- Senator Button —The allegation is just not true. You should get your facts right . Senator PETER RAE —I will quote from the Minister's letter to me-- Senator Button —You named the industry advisory councils. That is one. Senator PETER RAE —Yes. The letter states: . . . regarding Opposition representation on both the Australian Manufacturing Council and the nine Industry Advisory Councils,- This is a letter from the Minister for I Don't Know, the Minister who is again proving that he does not know what he has actually written- I wish to advise that as the longer term arrangements for Councils are under review, attendance of parliamentary delegates, both Government and Opposition, has been suspended for the time being. As soon as the longer term issues relating to Councils have been resolved, I shall contact you again regarding this matter. That is a letter to me from the Minister dated 11 May 1983. Only one day prior to that letter being received by me the Estimates committees were told by a senior public servant that the Opposition would be represented on these councils and the Minister did nothing to refute what was said, although he was present during that discussion. The senior public servant said, as reported on page 7 of the Senate Estimates Committee Hansard of 10 May: Membership of the Steel Industry Advisory Council . . . I indicate that this was mentioned together with other groups- is . . . and two parliamentary representatives, one from the Government and one from the Opposition. As time is short, let me just refer to some further aspects of this Minister's co-operation and consensus. We have Mr Justice Fisher's report on the New South Wales steel industry-a matter of great importance to Australia and a matter which is causing great concern to a large number of people in Australia. Are we to have a steel industry and is there to be further huge unemployment and disinvestment? What do we find? We find that, although this report was presented on 23 May, I, as the Opposition spokesman, have still not been able to obtain a copy of it, either from the Federal Labor Government or the State Labor Government. I was told as recently as this morning by the staff in the office of the Minister for I Don't Know that they could not let me have a copy. Senator Button —Who is that? That is me, I suppose? Senator PETER RAE —That is Senator Button. The Industries Assistance Commission' s final report on the steel industry went to the Government last Thursday-a matter of some considerable importance. It has already been written up in all the media. It has been leaked to the media but the Opposition cannot obtain access to it from this consensus Government. Again, as recently as this morning, I was refused a copy of that report by the Minister's office. I was told that it is confidential until it has been considered by Cabinet. But the Press has it. This consensus Government, which is proposing to use the term 'bringing Australia together' as a new form of government, refuses to let a copy of that important report be made available to the Opposition even on a confidential basis. The Australian Labor Party committed itself to preserving the steel industry virtually at all cost and before receiving professional advice. A commitment was made during the election campaign to this effect: The Labor Government gives an unequivocal commitment to the maintenance of a viable and efficient steel industry in this country. I inform Senator Button that his leader, Mr Hawke, said that in the Australian Labor Party's policy speech of 16 February. He also made the statement, from which the Government has since resiled, that the decisions would be taken within 100 days of the Labor Government assuming office. I accept and congratulate the Government on resiling from that commitment. It was a commitment that should not have been made; it was irresponsible at the time it was made. The one responsible action for which I commend the Government is for saying that it would endeavour logically to reach a conclusion in relation to the steel industry. I just regret that the Minister does not find the idea of consensus worth while. Just a couple of days after the receipt by the Government of the IAC's final report Mr Hawke described the report as being highly contentious. He said: The Government will not be bound by its recommendations but will treat the report simply as one source of advice to be considered along with other advice. I presume that the Minister was present when the Prime Minister made that statement on Monday this week. I just wonder what other independent sources of advice the Government sought and what advice it intends to seek in relation to this matter. Will it be what Mr Hawke referred to, again on Monday, when he said : . . . a tripartite committee of government, the company and unions was investigating how retrenchments could be avoided in future 'and a voluntary retirement scheme put in place as an alternative'. Again there was no consultation with the Opposition. We have come to accept this as par for the course with this Minister. There was no consultation with anybody else either, other than those who were involved and have become part of this Government's modus operandi-big government, big business and big unions. That was what the National Economic Summit Conference was all about, that is what this Government is all about, and that was what was reaffirmed in relation to Australia's major problem at the moment in regard to the industry and commerce area, that is, the steel industry. On Monday of this week the Prime Minister reaffirmed that that is the approach of this Government. I wonder what is the position when I hear answers such as that given by the Minister for Industry and Commerce in relation to the manufacturing industry, which is a principal responsibility of his. On 24 May I asked him whether he agreed with the Minister for Science and Technology, Mr Barry Jones, who said: Australia's declining employment in manufacturing is permanent, irreversible and structural. In my view it is not temporary or to be rectified by tariffs, wage freezes, bounties, quotas or other fiscal measures. The Minister for Industry and Commerce basically agreed with that statement. He said that he agreed with the second part of the question, that the problem was not to be rectified by tariffs, wage freezes, bounties, quotas or other fiscal measures. In relation to the first part of the question he said: A number of people . . . suggest that by the turn of the century manufacturing employment in Australia, as we traditionally know it, will probably decline to about 12 per cent of total employment. I am unable to say whether that view is correct. He is not only the Minister for I Don't Know but also the Minister for No Hope. That is the concern of the Opposition, that no hope is being held out in any way . As I have identified from the answers to questions, we have not only the Minister for I Don't Know but also the Minister for No Hope. The bane of contention by the Opposition is that in relation to all of these important questions on protection the Minister says: 'I don't know'. If the Minister has regard to his answers to the Estimates Committee, he will find-I have not time to cite them all-that his answers were either 'I don't know' or 'It is being looked at'. Dumping is being looked at. With regard to employment, his answer was: 'I don't know'. As was quite evident from the economic statement, inflation is going up, but there is no contribution by this Minister towards its control. There is no hope and no encouragement for investment. He is the Minister for No Hope for anything better. There is no hope for the steel industry in Whyalla, as one of my colleagues will identify. There is no hope for the automotive industry , the textile industry-all with their own problems. What does the Minister say? In answer to every question which is likely to be regarded as relevant, he proves what the Australian of 21 May, after the economic statement, said. The article stated: . . . it is still not possible to discern the general economic principles which Mr Hawke and his colleagues intend to follow now that they hold office. What has happened in the three months since this Government took office and since this Minister took on this responsibility is a continuous stream of confusing but ineffective statements which are put-offs. As the Age newspaper of 23 May said: For another, the Minister for Industry and Commerce, Senator Button, has indicated that there was little the Federal Government 'could or would do' to help the ailing car manufacturer. That appears to be the attitude which this Minister has adopted. I conclude by repeating: Hey diddle diddle, The cat and the fiddle The cow jumped over the moon; The little dog laughed-- The ACTING DEPUTY PRESIDENT(Senator Haines) —Order! The honourable senator's time has expired. Senator Tate —Madam Acting Deputy President, I raise a point of order. I want that nursery rhyme from this kindergarten debater withdrawn. It draws an analogy between the little dog and the Minister for Industry and Commerce. I find it extremely unparliamentary. Senator Button —May I speak to the point of order? I appreciate Senator Tate's kind gesture but I do not want it withdrawn. The ACTING DEPUTY PRESIDENT —There is no point of order. Senator BUTTON(Victoria-Minister for Industry and Commerce)(2.40) —The topic of this matter of public importance-as I understand it from the Order of Business sheet, not from listening to Senator Peter Rae's speech-is: The failure of the Minister for Industry and Commerce to take any appropriate steps to overcome those problems of industry which are causing loss of both jobs and investment. I did not want the nursery rhyme references from Senator Rae withdrawn because I thought they were the best part of his speech and they ought to be recorded in Hansard. As a general comment, I thought the only area of the speech from the shadow Minister for Industry and Commerce, Senator Peter Rae, in which he spoke with any passion was in his personal invective against me. If he wants to do that, he should at least get his wires untangled about the topic to which he was supposed to be addressing himself, expressed in the words of his own matter of public importance. He had a lot of passion in terms of personal invective. In the whole time that we have been in government he has asked two questions about industry and commerce matters and in the course of the debate today he has chosen to misrepresent both of my answers to those questions. He knows he has misrepresented them, particularly the answer I gave in relation to employment. If Senator Rae wants me to tell lies, as the Fraser Government did, about projections of employment in manufacturing industry, I will not oblige him. I will say what I believe will happen to manufacturing industry in this country. I say that to manufacturers and I do not see why I should not say it to Senator Rae in answer to a question. If we are to indulge in literary quotation, his speech was-I do not want to reveal the first line; Senator Rae can look it up-a speech 'full of sound and fury, signifying nothing'. He used the expression smart-Alick in the context of his speech and anybody can read the Hansard to see who the smart-Alick is from the nursery rhymes quoted here today. The whole substance of Senator Rae's speech disappeared in what purported to be an attack on a government which has been in office for 10 weeks. The whole substance of his speech went down the chute when he took it upon himself gratuitously to congratulate me on saying that the steel industry development plan might take more than 100 days to develop. He said it was very wise to be cautious in one's approach to these things, as in one's approach to a number of things. He does not give me that indulgence in respect of other matters of industry policy. I return to the words of the matter of public importance, which deal with the responsibility of the Minister for Industry and Commerce in these matters. Senator Peter Rae could have worded his MPI better. If he had wanted to criticise me for not answering questions about health rebates and such things in the Senate, he could have worded the MPI-perhaps he can do it next week-to criticise the Leader of the Government in the Senate. The subjects of those questions are not my responsibility as Minister for Industry and Commerce. They are his responsibilities as shadow Minister. It is my responsibility to deal with important questions of industry policy in this country, questions of employment and investment in industry, and to talk about getting Australian industry back on its feet. In Senator Rae's reference to what took place at the National Economic Summit Conference, the one speech that he did not deal with was mine. I invite him to deal with my speech to the Summit at any time as a matter of public importance. He can say what the Opposition thinks of the attitudes on industry policy that I expressed at the Summit. As Minister for Industry and Commerce I make no apology for not answering questions about the health rebate or about whether the Prime Minister (Mr Hawke) said this or that about superannuation on a particular day. There are the little gimmicky questions of politics which, of course, are important but which are not related to the terms of this MPI. I will say a few things about what I thought this matter of public importance was to be about. First of all, let me deal with a couple of his complaints. He said that the Industries Assistance Commission report has not been made available to the Opposition. When, in the history of this Parliament, have IAC reports been made available to the Opposition? When, in the period the present Opposition was in government, were those reports made available to the Opposition? We did not make the IAC report available to the Opposition, nor did we make it available to the Press. If members of the Opposition read some of the Press reports it will be quite clear that the Press is guessing about the contents of the IAC report. If Senator Peter Rae wants that indulgence from me, I am sorry, he will not get it. But if he wants indulgence regarding the Fisher report and if he directs an honest question or a letter to me, I will reply and he will get a copy of the Fisher report. He never had the decency to do that. He came in here today and said that he spoke to a member of my staff about the Fisher report but could not get it. If that is the way he is going to do business as Opposition spokesman for industry and commerce, it is not the way I am going to do it as Minister. It is hard to overestimate-- Senator Peter Rae —Why should I not contact your staff when I cannot get appointments with you to discuss things like the PVC case, because you know all about it and you don't want to talk about it. Senator BUTTON —To my knowledge the honourable senator has not sought an appointment with me about that matter. Senator Peter Rae —I have. Senator BUTTON —Well, the honourable senator can go on rumbling away. I have told him that I will give him a copy of the Fisher report if he asks me for it, instead of using it as a little matchstick to try to beat me with in the Senate. I want to talk about some of the problems which industry does face, which were not addressed in any way by Senator Rae. It is hard to overestimate the extent of those problems. Not only did we inherit 10 weeks ago an economy in absolutely appalling shape, but also we inherited years of neglect in relation to industry policy. As an example I point to the May 1983 edition of the 'Investment Overview' of Potter Partners, share brokers. That firm is not a particular friend of ours, but this is what it stated: The Labor Government inherited an economy arguably in the worst shape for 50 years: negative Gross Domestic Product growth; inflation and unemployment both in double digit figures; severe drought; and a projected 1983/84 Budget deficit in the order of 6 per cent of GDP. That is what that firm had to say about the economy which we inherited. But let us look at what Opposition spokesmen and former Ministers have had to say about industry policy over the last four or five years. I will not refer to them in the plural, I will just select one-the great Leader of the Opposition (Mr Peacock), who attracts something like 27 per cent of popular support in the Australian community. In an address to industry on industry policy on 7 December 1982, in his brief sojourn as Minister for Industry and Commerce, and talking about that year, he said: Conditions over the past year, fuelled by excessive wage gains, have resulted in a loss of competitiveness in industry, a squeeze on profits and a consequent rapid decline in employment opportunities. In October, a little earlier in the year, Mr Peacock said: But while international pressures were accumulating, we have . . . by generating some problems of our own making-in particular the excessive wage increases which have occurred over the last year. That was the rhetoric of the Government from which we took over-everything wrong with Australian industry was due to wages. No other questions were addressed. When the Opposition wanted to find a scapegoat for industry's ills, which have accumulated over 25 years under conservative governments, it blamed wages. It is still doing it this year as an opposition in the Senate- Senator Peter Rae —I thought the 25 per cent across the board tariff cut occurred under a Labor government. Senator BUTTON —The honourable senator can go back to that if he wants, but he did not mention it. He has not mentioned it for ages. It is something he has plucked out of the top of his head, like his speech. For years wages have been blamed as the cause of all Australia's industry problems. Of course, they make a contribution and the Government recognises that. This Government has a wages policy. Many of the difficulties, but by no means all, with which industry is now faced, occurred because of the absence of a wages policy at the time of conservative government. Difficulties are still coming through the system in 1983 as a result of the abandonment of a wages policy in 1981. We inherited not only those sorts of economic difficulties, but also an industry structure staggering under the weight of years of unprincipled, ad hoc decision-making, lack of planning by conservative governments and a lot of high- minded rhetoric and policy on the run in relation to industry. To prove that point it is not necessary only to listen to me. In any country successful competitive industries exist only because of government planning and industry assistance mechanisms. I ask honourable senators to look at all the success stories. But such an approach has not been ideologically palatable to conservative governments in Australia. That is why such success has never happened here and why we are now in the mess we are in. Senator Peter Rae —You agree with Barry Jones that those measures would not restore employment in manufacturing. Senator BUTTON —I will give a personal explanation to Senator Rae some time if he wants it so that he can understand my answers. Let us examine a couple of the industries he mentioned. The three stated objectives of the 1976 motor vehicle plan were as follows: Firstly, maintaining a viable industry producing at high levels of local content; secondly, ensuring consumers' access to reliable economic and reasonably priced vehicles; and thirdly, facilitating desirable structural change to improve the efficiency and competitiveness of the industry. Has that happened? Senator Rae has complained about my record of 10 weeks. Four days after we came into government, I got a call from Broken Hill Proprietary Co . Ltd saying that it was to sack 1,400 people. Eight days after we came into government I got a call from General Motors-Holden's Ltd saying that it was to sack 1,200 people. Are those sackings the responsibility of the Labor Government or are they the responsibility of the failure of past policies? Those who address themselves to that question clearly and fairly can come up with only one answer. The obvious answer is that we have inherited enormous structural problems in industry which have not been addressed before. I thought these would have been the sorts of questions to which Senator Rae might have addressed himself today. I thought he might have asked why, in ten weeks, we have not done what the Opposition failed to do in seven years and before that in 20 years. When I read the terms of the matter of public importance he submitted to the Senate this morning I thought he would speak about why we had not done all these things in ten weeks. But he has not done that at all. Let us look at what happened five years after the objectives of the motor vehicle plan were stated. The Industries Assistance Commission described the situation very well in June 1981 in its report on the motor vehicle industry. It said: Despite high and rapidly increasing assistance, disruption to the industry has not been avoided. Production and sales, both in aggregate and for particular firms, fluctuated considerably in the 1970s. Domestic production in 1980 was the lowest in a decade. Employment in the manufacturing sector of the industry has declined by about a third since the mid 1970s and major plant closures have occurred. Employment in the motor vehicle distribution and services sector, previously a growth area, has also declined. Profitability of vehicle manufacturers has not been good. That pattern, of course, is repeated across the spectrum of industries. Within the period of the Fraser Government the results of absence of industry policy were there for all to see. We had a less efficient economy as measured by a wide variety of indicators. Per capita growth in consumption was the lowest of the major Organisation for Economic Co-operation and Development countries between 1975 and 1981. Australia's growth rate was 1.4 per cent, well below the OECD average of 2.3 per cent. The only time Australia had a better growth rate was between 1972 and 1975. That was the only time Australia's growth rate was above the OECD average. The same occurred with unemployment in 1975, when Australia's unemployment rate was below the OECD average. By 1977 we had passed the OECD average in respect of both these matters. By the time of the 1983 election our unemployment rate was well above the OECD average and we had growing inflation, growing unemployment and rising interest rates-all at the one time. No wonder Senator Rae did not want to address his mind to some of those questions. I wish to speak very briefly about our industry policies. First of all I say quite frankly that in spite of Senator Rae's miscellany of quotations-largely out of context-the response of industry bodies to what we have been about has been very favourable indeed. The newsletter of the Victorian Chamber of Manufactures at the end of April stated: Since its election in March the new Hawke Government also has demonstrated its commitment to maintaining a strong manufacturing sector and the VCM believes the introduction of more effective national policies will continue. I am told by Senator Rae that all the dreadful things we announced in the economic statement of 21 May are detrimental. Of course, some of them are marginally detrimental to industry but we still retain the investment allowance and we still retain a depreciation allowance regime. In spite of the standards throughout the world in terms of depreciation the Fraser Government took seven years to bring us up to the rest of the industrialised world in terms of its proposals about revising the depreciation regime. This Government has indicated on a number of occasions that it will maintain existing protection programs at a time of massive social distress and dislocation. We are seeking wage moderation. We have indicated our concern about wage restraint since we were elected to government. As the Age commented yesterday, we have maintained a consensus on this issue in spite of the best efforts of the Opposition in this place. The Chamber of Manufactures and other bodies have referred to these matters in similar terms. Senator Rae mentioned the steel industry. We undertook to provide a development plan for the steel industry. We will do that in the time we have foreshadowed in recent statements. What did the Fraser Government do about the steel industry? It is an industry which shed 15,000 workers in the last 18 months. What did honourable senators opposite do about the steel industry when that process was going on? Senator Tate —Nothing. Senator BUTTON —Nothing at all. To use a colloquialism, those workers got the Big A from the Fraser Government. Senator Peter Rae —I rather thought the IAC inquiry was established. Be fair. Senator BUTTON —Oh yes, honourable senators opposite established inquiries into everything during their period of government but they never did anything about the answers they got on any matter. We are developing policies and encouraging industry. We will announce in the Budget context policies for the adoption and the adaption of the development of better technology in Australia. We will be supporting such bodies as the Industrial Design Council of Australia and others which are concerned with better products from manufacturing industry in this country. We are already considering ways of improving the venture and high risk capital market in Australia. A whole series of new policies beneficial to small business will be announced within five months of our election to government-not five years of Fraser Government total neglect. Senator Peter Rae —Will you let them be on EPAC? Senator BUTTON —Senator Rae is concerned about the Economic Planning Advisory Council. Does he want to be on EPAC; is that the point? Senator Peter Rae —Will small business be on it? I know the Opposition will not be on it because we are excluded from everything, notwithstanding what the Prime Minister said before the election. Senator BUTTON —That is quite proper in view of the performance of honourable senators opposite. I do not have time to go through this at length. I will do so at any time Senator Rae wants to bring up a matter of public importance about industry policy and the real issues. I do not intend to waste my time responding to a diatribe of personal invective. The ACTING DEPUTY PRESIDENT(Senator Haines) —Order! The Minister's time has expired. Senator JESSOP(South Australia)(3.1) —At the outset I state that I was not very impressed with the way in which the Minister for Industry and Commerce (Senator Button) responded to the speech made by Senator Rae in drawing attention to the neglect of the Government in doing something about job opportunities in Australia. The mark of the confidence that the Australian Labor Party has in the Minister was demonstrated by the number of Labor senators who were in the chamber listening to their illustrious leader. Perhaps I should start off in referring to the steel industry by quoting-- Senator Peter Rae —How many were there? Senator JESSOP —There are six now. That is a pretty good audience for the standard set by the Minister in his speech. Perhaps those honourable senators were rustled up by the Whip to give the Minister a little additional support. I wish to start off by referring to the steel industry by quoting a leading article in the Australian on Monday, 23 May 1983. The article states: When the Hawke government came into office a little over 70 days ago, the new Industry and Commerce Minister, Senator John Button, promised a long term plan for the steel industry within 100 days. He has since suggested that the problems in the industry are so complex it might take longer to make a decision. It should now be apparent that further delays in coming up with a long term plan for recovery are unacceptable. As the Minister with ultimate power in this area, Senator Button must ensure that the tough decisions are made quickly. It is only in that way this country can be assured of a world competitive, viable and profitable steel industry, with all that means for employment in our biggest manufacturing sector. I recall that during the election campaign the present Prime Minister, Mr Hawke, went to South Australia and demonstrated very volubly that he was interested in supporting an Australian steel industry. At the time he accused the Fraser Government of doing nothing about that industry and of making no statements with respect to it. Mr Hawke failed to tell the people of Australia, and South Australia in particular, that as a result of actions taken by the Whitlam Government when it abolished the Tariff Board and introduced the Industries Assistance Commission no government, legally, could make any judgment or decision with respect to any industrial sector in Australia before a draft report from the IAC was presented. That statement made by Mr Hawke shows how the Labor Party misled the community and the electorate of Australia during the election campaign. During the election campaign a public meeting was held at Whyalla. The Secretary of the Australian Labor Party was in the audience. I was glad that he was present because we were able to tell him something of the development that had taken place under the Fraser Government. The then Minister for National Development and Energy, Senator Sir John Carrick, was there as a speaker. He demonstrated what had been done and what was in prospect for Australia with respect to mineral development, which is most important to the northern part of South Australia and the Northern Territory. During question time the Secretary of the Australian Labor Party rose to his feet and asked: 'What is the Fraser Government going to do about the steel industry?' Senator Sir John Carrick answered him. The Secretary of the Labor Party, not entirely satisfied with the response, rose again and asked: 'In view of the fact that BHP at Whyalla is to reduce its work force to 4,000, what is the Fraser Government going to do about the steel industry?'. I contributed to the answer to the question. I said: 'I will tell you what the Fraser Government is going to do for the steel industry in Whyalla, South Australia'. I said: 'We will build a railway line from Alice Springs to Darwin, a distance of 1,440 kilometres. It will require 150,000 tonnes of steel rail and 2,225,000 sleepers. If it is decided that steel will be used for the sleepers, another 150,000 tonnes of steel will be required from Whyalla'. Furthermore we, as a government, intended to develop the Beverley and Honeymoon uranium deposits. Those two names will be familiar to those people in South Australia who are listening to this debate. Those two projects could have been brought into production within 18 months or so. That would require steel prefabrication in Whyalla. I also suggested that if the State Labor Government would co-operate with the Fraser Government with respect to uranium enrichment, a uranium enrichment plant could be built in Port Pirie. As a result hundreds of thousands of steel centrifuges could be prefabricated in Whyalla. I added that if the people of South Australia-and Australia-wanted development and job opportunities they should vote for the Fraser Government. If they wanted no development, no support for the steel industry, they should choose the Opposition, in which case it would be their funeral. I think people now appreciate that it could well be their funeral because this Government is not particularly interested in the development of our resources. Senator Townley —They have broken promises. Senator JESSOP —On the subject of broken promises, what did the Prime Minister ( Mr Hawke) say during the election campaign? He promised to provide an immediate reduction in income tax. That did not happen. He promised to retain the tax rebate for home loan repayments. That did not happen. I could mention a long list of broken promises, one of which was his promise that the Government would not abandon the Alice Springs-Darwin railway. Senator Kilgariff has been very indignant about that matter, as has Mr Paul Everingham. They pointed to the fact that the Northern Territory was relying on that project. Senator Kilgariff —It is to the detriment of South Australia. Senator JESSOP —I believe it is to the detriment of the mutual development of the Northern Territory and South Australia and it is in the national interest that that project should proceed. I regret very much that the great hope that was generated by former Prime Minister Fraser when he said that that project would go ahead has now been placed in jeopardy by the recent decision of the razor gang employed by the Labor Government. I was upset about the decision with regard to the Alice Springs-Darwin railway, particularly in view of the fact that it was supported quite strongly by the Minister for Transport, Mr Peter Morris, when he stated a few days before the decision was made that he supported the Alice Springs-Darwin railway as being in the long term interests of the development of this country. He pointed, of course, to the fact that it would generate 1,250 jobs. I believe that is an example of the way in which the Minister for Industry and Commerce has failed miserably to persuade the Government to proceed with that project in the interests of the steel industry. I turn to the importance of the uranium industry to Australia. This is another area in which the Minister should lend his support in order to recover the ground that has been lost because of the uncertainty existing in mining companies and industries in Australia with respect to the Australian Labor Party policy on this important subject. A headline in the Weekend Australian of 14-15 May states: 'Australia loses ground as Koreans turn to Canada for uranium'. It is very important for people to recognise that Australia has major deposits of uranium. Our deposits are on a par with those in Canada in turns of quality and basic competitiveness. In addition, there are a number of other factors which will favour new Australian producers in competing for satisfactory long term sales contracts. Firstly, we have very large proven resources of uranium and potentially could emerge with the largest resources in the Western world when the Olympic Dam deposit has been more fully evaluated. Our assured and probable resources now stand at about 550,000 tonnes of uranium. Indicated resources at Olympic Dam may increase this by one million tonnes. So, we have in Australia a major resource that ought to be made available for overseas countries. What does that mean? Can we afford to pass up these uranium-based job opportunities? In South Australia alone, it is quite important. As far as employment is concerned, South Australia is a rich uranium province, and, as a matter of fact, most of the uranium in Australia happens to be in South Australia as well as the Northern Territory. We have a little more than you have up in the Northern Territory, Senator Kilgariff. That is what makes the transport facilities so important to the mutual development of the Northern Territory and South Australia. A uranium industry has the potential to generate several thousand jobs. In South Australia alone, the Honeymoon project and the Beverley project, when pilot stage is completed, would generate between 100 and 200 jobs. Uranium conversion plant would generate 200 to 300 jobs in the pilot stage, and a uranium enrichment plant, during the construction stage, would mean about 600 jobs. The total number of jobs involved in those three projects would be between 900 and 1,000, and, during operation, between 700 and 900. In service industries, between 2,150 and 2,750 jobs would be created. As far as the Olympic Dam is concerned, additionally, in the construction stage, between 9,000 and 18, 000 jobs would be generated, and, during operation, there would be between 2,000 and 3,000 jobs. The service industries applicable to that project would gain between 8,000 and 12,000 jobs. That is the sort of thing that the Fraser Government would have liked to pursue and to implement, and it would have seen some results with respect to generating new industries and new jobs throughout Australia. But this Government has failed to do it-largely, I think, because of the inertia of the Minister for Industry and Commerce. Senator Peter Rae —There is distraction, too. He spends most of his time attacking the Australian Broadcasting Commission, which has nothing to do with his portfolio. Senator JESSOP —Senator Button goes into portfolios that have nothing to do with him. He makes extravagant statements about the Chairman of the Australian Broadcasting Commission, gets himself into hot water, and becomes distracted from the very important role that he should be playing in helping to get Australia back on the road to recovery. Let us face the fact that the Fraser Government had those problems. We were coming to grips with them. We introduced capital works programs, which have subsequently been trimmed. We introduced a program of national water resource development, which is the most vital activity if we are to develop Australia beyond the year 2050. National water resources are the most vital element with which we must come to grips on a national basis. If the Government comes up with a proposition to develop a national water resource program, I shall be in total support of that, because I believe that, by the year 2050, our water resources will be fully committed. Unless we do something now, spending not $650m, because I think that the sum ought to be $6.5 billion or more right now, I believe that Australia will go down the drain beyond that time. Senator JACK EVANS(Western Australia)(3.14) —The topic of this matter of public importance covers those problems of industry which are causing loss of both jobs and investment and the failure of the Minister for Industry and Commerce ( Senator Button) to take appropriate steps to overcome these problems. I think that we need to look at the causes of loss of jobs and investment not just in the context of what is happening today or what happened last week, or even what has happened in the last couple of months, but how we have arrived at our present position. I think it is not even appropriate to suggest that the causes are just the policies of the previous Liberal-National Party Government, although it is obvious that many people believe that those policies have a lot to do with our present predicament. It is also not appropriate to say that the cause was of the trends in the international economy, which is still in recession and which has caused a world drop in demand for Australian raw materials. Nor is it fair to suggest that the causes were related to the drought , which has been superseded now, tragically, by floods. One might add that we as a parliament have made inadequate preparation for such disasters in this country . Whatever the causes they have resulted in the decline in business profits, high interest rates and some disproportionately high wages and wage increases. Of course, when one is looking at the high wages and the high wage increases in some areas one needs to recognise that this was brought about by the coalition Government abandoning the central wage fixing system and allowing nature to take its course. I think it is fair to say, when one is looking at all of these causes and the governments this country has endured over the last decade or so, that the people have started to wonder whether the country in fact has been managed at all by its government. For instance, Morgan Gallup polls taken out in October 1982 indicate how people felt in the five years from 1977 to 1982. In 1977 people felt that the Liberal-National Party Government had managed the economy better and the proportion of people who felt that way was 46 per cent compared with 32 per cent who favoured the Australian Labor Party management of the economy. By October 1982 in fact the people were recognising that they were in a tremendous predicament. The polls showed that 37 per cent of people thought the Liberal- National Party managed the economy better, 37 per cent thought Labor could manage the economy better and 26 per cent said that neither party was capable of managing the economy. In other words, the choice was Tweedledum or Tweedledee and preferably neither of those two. We now have a Government which is caught between two urgent requirements. On the one hand is the need to rescue the economy from its disastrous condition and on the other hand-at times this may be in conflict with the first requirement-is the need to plan and to take responsible long lasting measures, fully planned and fully communicated for the long term recovery and stabilising of Australia's economy. In other words, we have the difficult choice-ad hoc solutions or long term solutions. We have just been through seven years of Liberal ad hockery-the Liberals being the masters of ad hockery in government. Regrettably this matter of public importance is typical of the Opposition's approach to Australia's economic problems. The Opposition wanted the solutions found in the first couple of months of government. It wanted instant solutions imposed upon the people of Australia. The very people who are today criticising the lack of action were, a week ago, criticising the mini-Budget and the mere fact that a mini-Budget was introduced to this Parliament. The Opposition cannot have it both ways. The Liberal Party does not seem to have had any interest in responsible economic management. There has not been any interest for as long as I have been tuned in to this Parliament, and there does not seem to have been any interest at all judging by the actions of the party even as late as 1982 when it introduced a typical pre-election Budget with the object of having an election a month or so later. That was an election Budget which nearly destroyed this country's economy. The Liberal Party did the same thing with its pre-election jitters for 12 months at a time before each of the last elections. But these were ultimately held after hanging back and pretending to the people of Australia that in the next month or the month after the Australian Democrats would cause of a double dissolution. So the whole of the economy of this country was left in a state of uncertainty simply because a Prime Minister wanted to hold his back benchers and a few other lobbyists and pressure-groups at bay while he pretended that an election was around the corner. In other words, for seven years we had no direction. We had literally a ship with no one on the bridge-like our aircraft carrier, which served a very valuable, useful, decorative purpose, if that is an important function-a ship unsure of its objectives or its direction. In other words, the officers on the bridge are there for ceremonial purposes only. It has been that way with Australia for the last seven years because nobody has been interested in longer term planning. That is what this matter of public importance today suggests-that we should continue without longer term planning. I give a little credit to the Australian Labor Party because at least it organised the National Economic Summit Conference. It introduced, produced and presented some economic forecasting models to the people of Australia who have to make key decisions in the near future. It is to be hoped that this process will be repeated next year and in subsequent years and that it was not just a one-off action to win a few friends at the start of Labor's term of office. It has introduced the Economic Planning Advisory Council. Again it is to be hoped that that will be a meaningful body and not just a group of people which will meet, have a chat and let the Government get on with the job without taking any notice of its advice, but there is not yet any commitment to a long term indicative plan by this Government for the country, for the people who have to make the other crunch decisions outside the Government and the Parliament and who should make them within the framework of a direction of the Parliament or the Government of Australia. It is time that both the Liberal Party and the Labor Party stopped this antagonistic approach which is endemic in this Parliament and which, regrettably , is so typified by this matter of public importance today. The main sporting activity of this Parliament-it does seem to be a blood sport-is to belt the supporters of one's political opponents. The Liberals found great glee in belting the trade unions about the ears, in making scapegoats out of the unemployed with the object of reducing inflation, and in ignoring the plight of small businesses, thereby encouraging the monopolies which put small businesses out of business. The Liberal Government gave no help to legitimate small business, except to some of its Liberal supporters. A typical case is that of its tax avoider friends who were helped in the tax avoidance industry through years of neglect by the previous Government. On the other hand, Labor has its enemies that it likes to belt about the ears. It seems to have a thing about big business, irrespective of the value of big business to Australia. It even gets stuck into medium and small businesses. Typical of that attitude is its latest tax reform which sweeps up everybody in an attempt to get at tax avoiders. That tax proposal has the effect, because it is so general, of crucifying some innocent people. This approach suggests that people who have made handsome profits will be hit and made to pay back some of those profits irrespective of whether they were genuine tax avoiders or just caught up in the net which, principally, aimed to get the tax avoidance group. Labor's attitude towards the private health funds is again typical of a government which wants to hit out rather than build and obtain co-operation from important segments of our community. The Government has initiated two measures in regard to the private health insurance funds, an important group which has gained and developed the confidence of the public. One is to leave them out of Medicare and the other is aimed at reducing their reserves over the next six months so that they will be weakened when the next competitive stage of the development of health insurance starts at the beginning of next year. For some reason which escapes my reasoned attention, it does not seem to have any affection for the professional and self-employed people in this country. No support nor sympathy is given to these groups and individuals. The whole approach of both the Liberal and the Labor parties seems to be: Blame someone else, preferably your political opponents. Let us all become a little constructive. Let us take some corrective measures. Instead of nit-picking and engaging in personal attacks in this Parliament, let us try to implement some measures which will stimulate the economy. It seems that there is scope for that , and the Government has recognised the tremendous potential by stimulating the housing industry. There is a lot more scope, in addition to that housing industry support, if the Government recognises the tremendous potential of sunrise industries, particularly in the new technology and information areas. The Government seems to have recognised that, but we are awaiting with bated breath its job creation programs. It is to be hoped that it gets behind and strongly supports employment oriented industries such as tourism, recreation and again that self-same information industry. It needs to recognise the desperate need for all Australians to be able to share the available work. That will need some changes of attitude by not just the Government but by people out there in the real world who are suffering tremendous traumas from unemployment. This may include new approaches to industrial relations-perhaps reducing some penalty rates, perhaps reducing some hours and perhaps making deals for tax reductions in lieu of pay increases. Principally I make an appeal to this Government to help small businesses. The potential for massive growth of small, independent, innovative businesses in this country is unlimited provided we recognise their needs, which are disparate , and provided we give this group adequate communications channels to the Government, which have hitherto been lacking. Senator Peter Rae —Will you support our EPAC amendments? Senator JACK EVANS —Let us look at the things that small businesses need, which include some of the things which the Opposition is proposing. Let us try to give them access to low interest finance and to research and development avenues, let us try to protect the inventors and innovators which we produce in this country but then allow to escape overseas because nobody is interested in supporting them. Let us look at the scope for restructuring small businesses so that, instead of getting the worst of all worlds, they can get the best of the partnership, co-operative, private company and public company structures which are available to other structured organisations and corporations. Let us introduce a just and easily understood tax Act. That will not be done necessarily tomorrow or next year, but let us at least work towards it, even if it takes 10 or 15 years, instead of just working on band-aid measures, as all governments seem to have done over the last few decades. It is time for us to sit down together and to try to restructure the tax Act and at least obtain some worthwhile objectives that we can aim for by the start of the next century if not by the end of this one. Let us also give small businesses some help with their training requirements- not just training of management and staff but also training in preparation for the new technologies. Let us get rid of that horrendous payroll tax which is making it so difficult for small businesses to put on additional employees. In conclusion, I believe that the solution to Australia's economic problems is bound up in finding ways in which all of us may work together-all doing our share, all planning our share, all planning and working as one nation. Let this Parliament set the example. Senator HAMER(Victoria)(3.29) —The Senate is considering a matter of public importance, as follows: The failure of the Minister for Industry and Commerce to take any appropriate steps to overcome those problems of industry which are causing loss of both jobs and investment. I am very sorry that the Minister for Industry and Commerce (Senator Button) is not here to listen to this debate. Senator Peter Rae, perhaps being a little personal, described him as the Minister for I Don't Know. The fact that he left the chamber as soon as he had completed his speech might, had he still been here , have led Senator Peter Rae to describe him as the Minister for I Don't Care. Nevertheless, on a subject such as this, when the Senate is debating a matter which should be of great importance to the Minister, he certainly should be here to listen to the debate. The problem is that it is quite clear that the Australian Labor Party does not understand the nature of the problems facing our economy. Senator Jack Evans, in the contribution he has just made, suggested that the Opposition was proposing that the Government should have instant solutions to all the problems. That is not what we are saying. We are saying that the Government must understand the cause of the problems and not take inappropriate action. We suggest that many of the actions that the Government has taken-I will come to this in a moment-are, in fact, quite inappropriate to the problems we have, and that the fundamental problem of our present industrial system is that the profit share is far too low . The share of profit relative to gross non-farm product used to be, traditionally, 14 to 15 per cent. For instance, in successive years from 1978 to 1981 the share was, respectively, 14.7 per cent, 14.5 per cent, 15.2 per cent and 14.3 per cent. But last year, at a time of declining economic activity, the totally unjustified and unaffordable wage increases pushed the share of profit back to 11.8 per cent. I know that many honourable senators on the Labor Party benches would cheer about that, but if they thought through the consequences of that I think they would not cheer so loudly because profits are the source of investment. All investment directly or indirectly is the result of profits. Out of investment comes efficiency, out of efficiency comes competitiveness and out of competitiveness comes jobs. Governments cannot afford to allow profit share or investment to fall. Governments cannot make investments. They are made only by firms who think they have a chance of making a further profit. If they do not think they have a chance of making a profit they will not invest. Faced with all this, what did the Government do? One thing that some of us may still remember is that it held an economic summit meeting which was going to solve all of the problems of the economy. Some of what the Government did at that National Economic Summit Conference was good; the fact that it revealed a lot of economic information I think was excellent. I wish we had done it. I am sure we will do it when we get back to power. It is good that that sort of information is available. But, having released that information, the Government ignored its implications. It adopted, by implication-certainly it is outspokenly in favour of it now-a scenario that will do nothing to improve the share of profits, which will do nothing, therefore, to create new jobs. At the Summit it tacitly accepted a wage policy which it is committed, by the prices and incomes accord with the trade union movement, to support before the Australian Conciliation and Arbitration Commission. What it committed us to is a loss of further jobs and no restoration of profits. I repeat: Out of profits comes investment, out of investment comes efficiency; out of efficiency comes competitiveness; and, finally, we get more jobs. If the Government does not see that sequence it has no hope of rectifying the serious problems which our economy faces at the moment. What else did the Government do? It has talked a lot about the importance of the new technology. Senator Button, the Minister for Industry and Commerce, said at the Summit Conference: We have, however, to direct our energies to the question of modernising our industrial base and expanding into growth activities involving both the manufacturing and service industries. Government policies will be strongly directed to this end. But are they? I give one example which shows that the Government is doing exactly the opposite; that is, the abolition of group taxation deductions. The previous Fraser Government, in its last Budget, introduced group taxing for industries such as the steel industry. Group taxing allows an industry to offset profits in one division-in the case of Broken Hill Proprietary Co. Ltd, for instance, the oil division-against losses in another division, thereby providing funds for modernising the loss areas to make them efficient and competitive. BHP planned to spend the $2,400m profits made by the oil division to modernise its steel division. This taxation plan has been scrapped, very unwisely, by the present Government. The result is that these companies will wind down their investment. This decision by the Government is not rational. It was done in direct contrast to its claimed economic objectives. What else does the Government do? It scraps the water resources program. Australia is the driest continent. If any country needs to devote resources to conserving water it is Australia. As Senator Jessop noted earlier, the Government has scrapped the Alice Springs-Darwin railway, which would have resulted in a considerable demand for steel from Whyalla. The Government is dithering all the time about what is to happen about uranium, an area of activity which could provide many jobs. Again, as Senator Jessop has pointed out , while the Government dithers potential customers are going elsewhere and investment will dry up. People will not invest if they do not know which way the Government is going to jump. I repeat, many jobs are involved. The Chief Minister for the Northern Territory estimated that the mining of uranium could provide 60,000 jobs in the Territory. That figure is probably high, but nevertheless a substantial number of jobs would be provided if proper development were allowed of this key resource to the world economy. Senator Jack Evans mentioned the importance of stimulating small business activity. The Government is to set up, in the same style as the Summit, an Economic Planning Advisory Council, EPAC, but again it will represent big business, big government and big unions. Small business does not get a look in. I find detestable this system whereby these big groups can decide the economic outlook for all of us. I hope, in view of what Senator Jack Evans has said, that he will support the Liberal Party amendment seeking small business representation on EPAC. When we move it I hope that we will have the Australian Democrats' support for it. Senator Jack Evans —You will. Senator HAMER —I thank the honourable senator; that is excellent. I hope that we will see his vote on the line when the moment arrives. Small business contributes a major share of the Australian economy and must have some input to the framework for the future of our economy. I have referred to what the Government has done. I suggest that all of the things it has done will prove to be negative and harmful to recovery. The Government has no plan. Perhaps it cannot have a plan because it has not yet seen what the problem is. Until one understands the problem there is no way in which one can act coherently to overcome it. What is the Minister for Industry and Commerce, Senator Button, doing? Senator Peter Rae spent some little time in describing the way in which the Minister is dithering, the way in which he does not seem to know the answers to any of the questions that really confront him. In that regard, I agree with Senator Peter Rae that the Minister seems to spend more time on communications for which he has no real ministerial responsibility than he does on the key areas with which he should be concerned. We have no clear directions about tariffs. We do not really know what the Government's decision is to be or what its attitude is to be. It has taken no action on dumping procedures. In reply to a question asked of the Minister during the hearings of Senate Estimates Committee A, the Minister said: A departmental review of dumping is taking place. I do not know whether it is true to say that we are considering further initiatives. That seems to be a very inadequate statement on the subject of dumping, which is causing enormous damage to many Australian industries. Whatever attitude one might have on the effect on the Australian economy of varying levels of tariffs, I know of no one who supports dumping, which is malicious, damaging and destructive. To have the Minister say: 'I do not know whether it is true to say that we are considering further initiatives', in giving evidence to a Senate committee seems to indicate more of a hands-off rule than one could possibly justify. No decision has been taken on dumping. The Minister is also trying to press employers to retain more labour than they can economically employ. I ask honourable senators to think of the consequences. As far as I can gather from what the Minister has said, he is suggesting that BHP should have kept on the 25,000 men that it has shed in the last year or 18 months. But what would be the consequences if it did that? The steel industry would not sell any more steel as a result of keeping on more employees. The company would be bankrupt. Rather than force firms to keep on labour that they cannot usefully employ, the Government should create a climate in which there is a growing economy so that such people can be usefully employed. If the Government forces firms into financial difficulties in order to keep on labour that they neither need nor want, those firms will finish up bankrupt and all of their employees, rather than merely some, will then be out of work. Firms must adjust their labour force to the needs of their market. It is the Government's job to encourage expansion, new markets and new jobs, not to force firms to hold unwanted employees in declining industries. I understand the Minister has accepted that employment in the manufacturing industry is almost certain to decline. That is true. I think changing technology will have that result. But the Government has not looked at the consequences of that happening. It should be looking at how more people will be employed in the service industries. Yet, has the Government taken action on one of the biggest bars to employment in the service industry, penalty rates? One Minister mentioned penalty rates-he was the Minister who also mentioned koala bears-and he was immediately slapped down by his own party. The Government is not prepared to touch this matter although it knows that this is one of the biggest bars to the shift of employment into the service areas. The Government has not done anything-I am bound to say it may do something in the Budget, though I doubt it-about payroll tax. That is a very big disincentive to employment, particularly in small businesses. It has not even initiated anything-I hoped it would have by now-to look at the very damaging rackets that are being worked in workers compensation with the consequence that premiums are sky high. Again, this is a strong disincentive for employers to take on people. I wish this Government would talk to the Victorian Government, which is planning dismissal procedures such that it will be almost impossible to discharge employees. The consequence will not be that more people will stay in work. The consequence will be that employers will be very reluctant to take on staff if they know they will not be able to dismiss them if they cannot perform. This is all just plain muddleheadedness. It is an example of what Mr Peacock has repeatedly described as Hawkespeak-that is, saying one thing and doing the opposite. All the things that I have listed are the exact opposite of what the Government was talking about. You will remember, Mr Acting Deputy President, that during the election campaign we heard a great deal about consensus and about bringing Australia together. Consensus in economic terms seems to mean decision by small functional groups-the fascist system. Big business, big unions and big government get together. They agree and that is called consensus. That is not what consensus is about, or not what it should be about. The Labor Party talked about bringing Australia together. The first major action of this Government in bringing Australia together was to introduce measures which would be the most divisive since Federation. Bringing Australia together indeed! What this Government did during the election campaign was to promise much. So far it has delivered nothing. Senator ROBERT RAY(Victoria)(3.44) —For about the fourth time in two weeks the Senate is facing a somewhat pathetic matter of public importance introduced by the Opposition. I often wonder whether any honourable senators opposite believe in reincarnation. If they do I am sure they will all reappear as great vultures in Serengeti National Park. Senator Peter Rae began by quoting a nursery rhyme. Senator Button very aptly pointed out that it was the only substantive part of his speech. Having heard the three Opposition speakers, I was reminded of the three blind mice. They have, in fact, an absurd expectation of what any one Minister or any government can achieve in 77 days. This matter of public importance is aimed at Senator Button. Senator Button has been a Minister for 72 days; he was sworn in 72 days ago. To expect any Minister or any government to solve any problem within 77 days is a bit much, but to expect Ministers to solve the problems handed to the Labor Government by an absolutely hopeless Liberal government is to expect too much. Before taking any action it is necessary to identify the problems. Senator Button has been assiduously applying himself to doing that in the last 10 weeks. He has been assessing what the problems are in Australian industry rather than shooting from the hip. If Senator Button had come into this chamber, having been a Minister for a week, and said 'We will do these 135 things' there would be a matter of public importance stating that the Minister was shooting from the hip and was making statements and decisions without proper consideration. Honourable senators have to understand the problems that we have inherited. I ask them to look at the figures for 1981-82 when exports remained constant. In that period while honourable senators opposite were in government imports went up by 21 per cent. In normal times industry utilisation is between 95 per cent to 100 per cent. At the moment, as a result of the legacy that we inherited from those opposite, it is 70 per cent. in areas such as textiles it is down to 40 per cent . The bulk of our proposals to deal with these problems will, quite obviously, come in the first Hawke Budget when we will see and debate what we will do to solve some of these problems. For example, the first need, I think, is to get co -operation between employers and employees. A good example of that occurred with the metal trades on 7 April when Senator Button took that very important step of encouraging them to make joint approaches-rather than individual ones-to the Government and discuss the matter. Specific industry recovery in any event will occur only in the context of a general economic recovery. This is achievable only through macroeconomic planning. The Government has already takens steps in this regard. The steps taken so far include the holding of an economic summit, something the Fraser Government refused to do for seven years. Mr Deputy President, you commented on what a wonderful thing it was to have all the economic facts out in the open. That is a latter-day conversion, at least on behalf of most of the Opposition. When none of the Treasury forecasts were released, when none of the facts were put on the table for every Australian to make up his or her mind and when, as Senator Walsh would say, a former discredited Liberal Treasurer is informed by the Senate of a projected deficit does he tell the public? Of course he does not; he just runs to the Prime Minister who puts the lid on the whole thing. We have had the National Economic Summit Conference. We have prepared the way for the August Budget with a May economic statement which tackled areas that the Liberal Party never had the guts or the foresight to even look at. We are looking at recreating centralised wage fixing so that we do have a wage fixation system in this country. We do not leave it to the market forces. We do not suddenly abolish indexation without any thought of what will follow. We are looking at a proposed pricing authority which has been given at least qualified endorsement by the Australian Industries Development Association. Finally, the energetic approach to new industries, especially those espoused by the Minister for Science and Technology, Mr Barry Jones, is under way. The draft report of the Australian Scientific Industry Association states: One fact is irrefutable: we cannot continue to maintain, let alone improve, our standard of living by doing what we have been doing during the past two decades. Reform is not and never will be a pleasant process. It is going to cause economic dislocations. However, the alternative, which is to do nothing, is far worse. Let us look at the most recent indicators on where industry is going, what its prospects are and at the AIDA statement issued on 4 April 1983. The AIDA carried out a survey of 60 large Australian mining and manufacturing companies. This April attitude presents a rather stark contrast to what it was in the previous December. At the end of the 1983 first quarter the AIDA states: Reduction rates in general were proceeding at a lower level significant reductions having been achieved in the second half of 1982. The AIDA in its outlook says that from April to September 1983 32 per cent of non-mining companies expect an upturn in sales. That was compared with 23 per cent in the December 1982 survey. Some 46 per cent of non-mining companies expect static sales compared with 21 per cent the previous December. Only 24 per cent expect a downturn in sales whereas the previous December the figure was 55 per cent. Labor has been in government one month and already there are expectations of an improved performance in sales. At the beginning of April 1983 78 per cent of non-mining companies surveyed perceived the economic downturn as having bottomed out. Today we have heard a number of attacks on the Government by born-again senators opposite. Suddenly when they are in Opposition they can see how easy it is to solve the country's problems. I think it is relevant to look at the Liberals record in this regard. We had, as Minister for Industry and Commerce for some five years, Sir Phillip Lynch. Admittedly he was not appointed to that position in the most salubrious circumstances. He had to stand down as Treasurer over the Stumpy Gully affair. When the then Prime Minister had the opportunity to reappoint him as Treasurer, he was thought of so highly that he was moved to the industry and commerce portfolio. The current and now discredited Liberal leader replaced him after he had been Minister for five years. During the time Sir Phillip Lynch was Minister he visited China, Hong Kong, the Philippines, Kenya and Italy. He went back to Italy. He then went to China again , to the United Kingdom, the United States of America, Japan, India, Switzerland and to the United Kingdom again. He went to Europe in general. Then he went to the United States again. He went to Switzerland and India again, to Switzerland yet again and to Japan again. This is by no means a complete list. We had a Minister for Industry and Commerce representing the Liberal Party, who was supposed to be solving the problems but who was almost a constant tourist. He went overseas time and time again. I wonder how many jobs were lost while he was away on these junkets? After five years of failure Lynch resigned having achived nothing to reconstruct industry in this country. I would have thought that five years was a fair enough time in which to achieve something. But there was total and utter failure. Sir Phillip Lynch will be remembered for two things when the history books are writen and he is assessed. Firstly, he will be remembered for his incompetence as a Minister, marked by 100,000 jobs lost in manufacturing industry. Secondly, during his last year in office I suppose he will be remembered for his intense loyalty to his Liberal leaders, provided they retained the numbers. He is now off mismanaging the Reserve Bank of Australia and I feel sorry for that institution. However, as I said, we had him in Industry and Commerce for five years. The matter of public importance contains an expectation that Senator Button should have achieved major progress in the area of industry reconstruction. Senator Button has been in office for 77 days. However, the Opposition today has failed to sustain the case that he has not done so. I think the matter of public importance flatters Senator Button almost too much. It expects him to have solved in 70 days the problems that the previous Liberal Government had seven years to deal with. The matter of public importance raised by Senator Peter Rae implicitly acknowledges, albeit unwittingly, that Senator Button has immense capacity and intelligence and has such an interest in the area that one would expect of him that he would have tackled and solved these problems in respect of which Senator Rae's colleagues were pathetic failures. Thus, by raising this matter of public importance, Senator Rae, has, in my view, unwittingly paid Senator Button a compliment. I think we have to ask the Opposition some questions if Senator Button is expected to solve these problems in 77 days. I ask honourable senators to cast their minds back because the previous incumbent of this position, the present Leader of the Liberal Party, had 145 days in which to solve the crisis that faced Australian manufacturing industries. The then Minister for Industry and Commerce had 145 days in office. During those 145 days more jobs were lost in industry than had been lost in any similar period going back to the Great Depression. Let me give one example. According to figures collected by the Australian Bureau of Statistics in January relating to projected business investment, under a continued Liberal Government investment looked like being 20 per cent less in 1983-84 than in the current financial year. We are still feeling the effect of these policies and more people are still losing their jobs . A lot of the blame can be sheeted back to the previous Minister for Industry and Commerce. That person, not being able to cope with that position and, in my view, not being particularly interested in the fate of ordinary Australians, has , I have to admit, now been promoted to an even more awful job. He now leads a rather querulous, bankrupt and 'second eighteen' Liberal Party. He could not handle the job of Minister for Industry and Commerce. Maybe handling the job of Leader of the Liberal Party is a lot easier. He had to appoint 30 shadow Ministers just to cover our 27 Ministers. When honourable senators opposite were in government, 22 shadow Ministers sufficed to cover the then Government's 27 Ministers. In fact, we used to lap the then Government with 22 shadow Ministers. Yet, the Opposition has 30 shadow Ministers to try to cover our 27 Ministers. I want to know what policies the Opposition has. After all, it is the loyal Opposition to Her Majesty's Government. What policies does it have? Can members of the Opposition say what they are? They cannot. If they were to do so they would look like they had undergone a latter-day conversion; it would look like, having been in government for seven years and done nothing, that they had suddenly come up with all the answers. That is not good enough. Senator Peter Rae is now, I understand, shadow Minister for Industry and Commerce. I hope over the next two years he will apply himself diligently and come up with an alternative set of policies which he can put to the electorate. I wish him luck that this time round he will not be a bridesmaid again and if he does win government he will become a Minister, but we have no guarantee of that. I listened to Senator Jack Evans. He made many constructive comments that industry should be restructured. Unfortunately the difficulty with any of the suggestions by the Australian Democrats is that they are never in a position to put those suggestions into effect. They come up with many ideas which are never costed and never balanced against other ideas. They are always in favour of reducing a whole range of government income measures and always in favour of a whole range of government expenditure measures. Unfortunately they cannot balance the two. This matter of public importance debate today has been the worst of a series we have had in this place. Members of the Opposition have failed to sustain that the Minister's performance is a matter of public importance. They have failed to put the alternative case. They have fairly vindictively attacked the Leader of the Government in the Senate (Senator Button). But I do not have to defend him; he did that fairly well. I believe that as the debate started with a nursery rhyme it could well end in that way. I think it reflects that the Opposition is just floundering and struggling around trying to disrupt things. It might be better-I know it is gratuitous advice from a novice such as I-for the Opposition if it started debating the important legislation that is still confronting us and making constructive comments here rather than coming up with such pathetic arguments. Debate resumed from 11 May, on motion by Senator Coleman: That the Senate take note of the report. Senator ARCHER(Tasmania)(3.58) —I was Chairman of the Senate Standing Committee on Trade and Commerce during the period in which the investigation into the fishing industry took place. First and foremost, I would like to thank the Committee and the staff for the time devoted to that inquiry. We had various problems during the Committee hearings because of the time involved and the changes of both Committee members and Committee staff. I make this plea to those who are responsible: What we need is staff who will be given a chance to settle in during an inquiry. I found the inquiry to be a most valuable experience. I visited between 50 and 60 fishing ports around Australia. I spoke with hundreds of fishermen in various places and I attended dozens of association and co-operative meetings. When I went to a fishing port I found it a little disconcerting that when I said I was from the Government it did not bring me much credit. The relationship between the industry, the Government and the Department of Primary Industry was generally less than favourable. Fishermen Australia-wide came up with the same problem. They did not feel they had sufficient input into what was happening to their industry. It was found that there was totally inadequate reporting from the Government and the Department back to the industry. I was making a few notes a couple of days ago when I realised that a few weeks back I had received a document headed 'The Policy and Practice in Fisheries Management'. It reached me in April 1983. The document was printed in 1982 and the subject matter related to a seminar that was held in Melbourne, which I attended, in February 1980. It is my opinion that a document that comes out three years after the event is really of little value. It was felt generally that there was a lack of departmental expertise. Not enough people in the Department had very much knowledge of the industry's point of view. At this stage, I do not wish to particularise except to mention one person who has recently left. I thank Con Keating, who was in the Department during the inquiry, very much for the co-operation and expertise he exhibited and I wish him well in his move to another area. By and large, the industry is regarded around Australia as being, in many ways, nearly a peasant industry. People do not regard fishing as terribly important. But about 20,000 people are engaged in the catching area and about 5,000 in the processing area. In one form or another, there are about 20,000 boats. The value of the catch is about $330m, which makes the fishing industry a fairly large enterprise when compared with other primary industries. One of the problems is that it has had almost uncontrolled growth. For instance, the value of boats in 1968-69 was listed at $64m but by 1978-79 it was listed at $413m. Most of these were big boats with a high catching capacity and high capitalisation. I presented the report to the then Deputy President in January. I sent copies to all the people around Australia who had given evidence and had shown an interest and I also wrote to them all asking them for their comments. Honourable senators might ask: Did I get them? I certainly did. I got letters and calls from all over Australia. I suppose that I have had about 120 to 150 replies in one form or another. Generally, the replies and the comments on the report were fairly similar. They established that a national policy was universally required and that it was absolutely important to the industry to be able to plan ahead. After the Industries Assistance Commission report comes down, the industry requires a national conference. This has been discussed and I hope it is carried through. The fishermen want representation at the decision-making level and compulsory funding for management research and sales promotion. They do not seem keen on having a centralised, domestic marketing body but they want an improvement on what they have and they want to discuss this in a manner that will clean up and improve the industry. Several people said that they wanted funding and representation but not a statutory authority. When I was able to discuss it with them and point out to them that the only way in which they could have representation and compulsory funding was via a national authority they all agreed, with the exception of about one of two cases, that a statutory authority was necessary. Similarly, they said that they did not see how yet another advisory body, as has been proposed from another source, would give them anything more than they have now. The matter of the 200-mile zone was discussed very largely in the early stages of the Committee. By and large it has not helped the industry. It created an over-expectation which was never achieved. It is an aspect on which there is still quite a lot of work to do. The industry and its administration are far from out of trouble yet. Already too much has been invested; there are too many boats; and there has been too much effort. A reduction in this regard is required. I think the industry can do this. The industry can make these decisions. I believe that, with a bit of government assistance only, the industry can carry it through. The Committee report commented on surveillance, how poor this was, the lack of co-ordination between the various surveillance bodies around Australia, and the inefficiency of the types of planes and vessels that are being used to carry out this surveillance. A lot of thought has to be given to surveillance. There are problems in the various fisheries which I will not take time to go through. Again, the fishermen themselves can make the suggestions that would put these matters right. They want to make these suggestions and they want to be a part of the decision-making. They do not want to have to fight the Department over it; they want to work with the Government. Import replacement is a very big item. What we found from this inquiry was that while the industry was catching fish it was not catching fish of the type the market required and it was not presenting the fish as the market wanted; it was not sufficiently market oriented. It is important that the industry should take the trouble to do what the consumer wants, and that is not being done sufficiently at the moment. I should like to make a special mention of the Australian Fishing Industry Council. AFIC has done a tremendous job over the last few years. It has not achieved as much as I thought it would be able to, nor do I see, in its present form, that that is likely to improve. But I would especially like to say that Fred Connell from Western Australia has done everything that one man could possibly do for the industry and, in the time of his association with Steve Carney, the executive officer of the Council, there was tremendous enterprise. I think that fishermen generally have to combine more with AFIC or another similar body to look after the needs of State, local and species fisheries. This is an area which needs strengthening. I have learned to have a great respect for these men of enterprise, tenacity and resourcefulness, men who have an enormously wide range of skills. I think that the future of the industry is well assured. It will need changes but I think that while we can speak about problems objectively with the industry and bring the industry to the fore, all of these problems can be solved. Senator PETER RAE(Tasmania)(4.6) —I wish to speak very briefly on this matter and to draw the attention of the Senate to some parts of the report to which Senator Archer did not have time to refer. I refer to the effectiveness of the Australian Maritime College and the proposal in paragraph 13.18 of the report for the establishment of a national school of fisheries. I would simply like to draw the attention of the Senate to the complimentary remarks which were made in the report in relation to the important role being fulfilled by the Australian Maritime College and the recommendation for the further consideration of the creation of a national school of fisheries. In relation to that proposal I suggest that the basic requirements for such a school of fisheries could be found in association with the Australian Maritime College and the Tasmanian College of Advanced Education, both of which establishments could provide the sorts of courses which are being recommended by the Committee. I hope that any further consideration of that particular proposal will have at the forefront the consideration that the ideal and most economical and efficient way to provide that sort of training in Australia is to do it through those two excellent institutions. Senator BOSWELL(Queensland)(4.8) —The fishing industry is the fourth largest primary industry exporter in Australia. I would think it is probably the most underrated of any of the primary industries. It is in need of a great deal of help. I should like to call on the Government to allocate some of the job creation funds to this industry, particularly in the form of mooring facilities, which seems to me to be the greatest need that the industry has, particularly in my State of Queensland. I agree with previous speakers that there is a need for a college to show the fishing industry how to process and market its catch. That need could be served adequately by a fishing college. I ask the Government to support that proposal also. Senator PETER RAE(Tasmania)(4.9) —by leave-May I add just one comment which I omitted to make? I would like to congratulate both the Chairman and the members of the Senate Standing Committee on Trade and Commerce on what I believe is an excellent example of what can be done by Senate committees in the preparation of an important report. I say that in relation to the whole committee. Question resolved in the affirmative. Senator McINTOSH(Western Australia) -by leave-The Senate Standing Committee on Foreign Affairs and Defence has resolved to resume two inquiries initiated in the previous Parliament. The question of the human rights and conditions of the people of East Timor was referred to the Committee on 26 November 1981. That inquiry is in its final stages and it is the Committee's intention to report to the Senate early in the Budget session of Parliament. On completion of the East Timor inquiry the Committee will resume consideration of 'Australia's defence co -operation with its neighbours in the Asian-Pacific region' which was referred to the previous Committee on 15 October 1981. Report Senator MISSEN(Victoria) —by leave-For the information of honourable senators I present the report of the Australian delegation to the Inter-Parliamentary Union for 1982. Mr Deputy President, I seek leave to make a statement in connection with the report. Leave granted. Senator MISSEN —As the only senator who attended both meetings of the Inter- Parliamentary Union in 1982, I have the duty formally to present the official report of the delegation, and I seek leave to have incorporated in Hansard, in shortened form, a statement which was made in the House of Representatives by the Honourable Ian Robinson, leader of the delegation. Leave granted. The document read as follows- INTER-PARLIAMENTARY UNION Report of the Australian Delegation for 1982 The two meetings for the year were the Spring Meetings, which were held in Lagos in April, and the 69th Inter-Parliamentary Conference, which was held in Rome in September. Concerning the work of the Inter-Parliamentary Union in 1982, I remind honourable members of two spheres of activity which, I think, are now well known . First, the Union, on its own or as co-sponsor with other international organisations, promotes and supports a variety of significant international meetings around the world each year. In 1982, such activities extended to participation in the Second Special Session of the United Nations General Assembly devoted to Disarmament, as well as in a special session of the United Nations Environment Program. In addition, the Union took part in major international meetings on the control of pollution in the Mediterranean Sea, and , in conjunction with UNICEF, organised the Inter-Parliamentary Conference on Policies, Programs and Legislation for Children in Africa last November. Second, the IPU, through its Special Committee on Violations of the Human Rights of Parliamentarians, continues to achieve a considerable measure of success in its work to protect the human rights of parliamentarians everywhere. I remind the House also of Australia's continuing membership of, and active participation in, the Ten Plus Group within the IPU-an informal association developed for the purpose of facilitating discussion on matters of importance which arise in the context of the Union's activities. Within this Group, Australia played a significant role in 1982, being represented on a small study group appointed at the Group's meeting in Frankfurt, prior to the Lagos Spring Meetings, to consider an Israeli application for membership of the Ten Plus and to examine the membership and role of the Group generally. A number of Ten Plus proposals for the consideration of supplementary items by the Rome Conference succeeded. On behalf of the Group, Australia proposed a draft resolution calling for a definitive peace between Iraq and Iran, which was adopted by the Conference. It also supported two successful Ten Plus proposals for the inclusion of supplementary items on the invasion of Afghanistan and on the Ethiopian aggression against the Somali Democratic Republic. Proposals to reorganise the sessions of the Union are under consideration. These were the subject of study by a working group which met in Geneva from 18 to 20 January 1982 and in which the honourable member for Berowra, Dr Harry Edwards, was an active participant. Recommendations made by the working group were approved in principle at the Rome Conference, and the Inter-Parliamentary Council directed that necessary amendments of the Statutes and Rules be drafted for consideration at the Spring Meetings in April 1983. The recommendations of the working group envisage two Conference sessions each year, accompanied by meetings of two Standing Study Committees. Each Conference session would be shorter than the September Conference under present arrangements. Another feature is that consideration of a topic by both the relevant Study Committee and the Conference would be completed at the one meeting instead of being divided between two meetings as at present. The honourable member for Port Adelaide, the Honourable Mick Young, served as Deputy Leader of the Delegation at Lagos, and the honourable member for Prospect , Dr R. E. Klugman, served as Deputy Leader at the Rome Conference. I thank them both for their support and co-operation as well as their active participation in the Delegation's work. I also thank all other members of the Delegation for their work and support. On behalf of the Delegation, I wish also to acknowledge the assistance given by Mr Peter Gregg, of the Department of Foreign Affairs, as the Delegation's Adviser. Senator TATE(Tasmania) —I present the fourth report of the Standing Committee for the Scrutiny of Bills concerning the Conciliation and Arbitration Amendment Bill 1983, the Income Tax Assessment Amendment Bill 1983, the Parliamentary Contributory Superannuation Amendment Bill 1983, the Statute Law (Miscellaneous Provisions) Bill (No. 1) 1983 and the Taxation (Unpaid Company Tax) Assessment Amendment Bill 1983. Ordered that the report be printed. Senator TATE —On behalf of the Committee, I lay on the table Scrutiny of Bills Alert Digest No. 5, dated 1 June 1983. Senator COLSTON(Queensland) —I table additional information received by Estimates Committee D and seek leave for it to be incorporated in the Hansard record of the Committee's proceedings. Leave granted. Ministerial Statement Senator WALSH(Western Australia-Minister for Resources and Energy)(4.13) —Mr Deputy President, during the passage of the Wheat Marketing Amendment Bill 1982, Senator Peter Rae raised several matters in Committee on 15 December 1982. They are recorded in Hansard at pages 3574 to 3580. His concerns related to provisions of the Bill affecting liability for any losses incurred by the Australian Wheat Board in its futures trading transactions as in clause 5, alterations to the Wheat Board's financial powers as in clauses 6, 7, 8 and 16, and a change in procedure for the remuneration of the Wheat Board's authorised receivers as in clause 17. The Minister for Primary Industry (Mr Kerin) has agreed to provide responses to Senator Rae's questions and I now present them to the Senate on Mr Kerin's behalf. I seek leave to have the responses incorporated in Hansard. Leave granted. The responses read as follows- Wheat Marketing Amendment Bill 1982 Clause 5: This clause amended section 12 of the Wheat Marketing Act 1979 to enable the AWB to operate on future markets in order to minimise risks associated with wheat sales and borrowings for financing the Board's operations. Such transactions are to be undertaken within guidelines approved by the Minister for Primary Industry. Senator Rae wished to know who would be liable for any losses arising out of AWB future trading, either within or outside the guidelines; whether the Attorney-General is of the opinion that the individual AWB Board members would be responsible for any such losses; and whether the Attorney-General had advised this Department of his opinion. The use of the term 'losses' can be misleading in relation to futures activities involving hedging operations. In these circumstances, any futures activities are matched against equivalent cash activities, for example, in relation to a specific parcel of wheat. Any gains or losses sustained on the futures part of the operation should be offset by losses or gains on the cash transactions. The outcome of the trading on the futures and cash wheat markets will be incorporated into the calculations of the Net Pool Return Rate (NPRR) under the Guaranteed Minimum Price (GMP) arrangements when the futures transactions are conducted within the futures guidelines approved by the Minister for Primary Industry. Therefore, in cases where the NPRR of a season is above the GMP price, the results would be directly reflected in the returns to growers whilst in cases where the NPRR is below the GMP price there will be a call on the Government's guarantee, to the extent of the difference between the GMP and the NPRR for the entire season. Should the AWB conduct futures transactions outside the approved guidelines, the situation is that, under S (9) (3) (h), in calculating the net pool return no account shall be taken of the results of those transactions in calculating the NPRR. If the NPRR so calculated were less than the GMP the effect of the exclusion of futures transactions conducted outside the guidelines would ensure that those transactions would not be included in the calculation of the call on the Government's guarantee. In these circumstances growers' entitlement from the AWB would be the net return from the pool, including the effect of the transaction conducted outside the Minister's guidelines, plus the amount of the Government's guarantee calculated on the basis of excluding any transactions conducted outside the guidelines. The legislative requirements to enable the AWB , and ultimately the wheatgrowers, to bear such a ''loss'' would have to be addressed should the circumstances arise. Senator Rae also asked whether the individual Board members of the AWB would be liable for losses arising from futures trading by the AWB. The Minister will seek a formal opinion on this matter from Attorney-General's particularly on the effect of Section 38 of the Act. Clause 6 This clause amended section 12 of the Wheat Marketing Act 1979 to enable the AWB to establish specific purpose financial reserves from the 1982-83 season onwards and deduct moneys from sales of wheat and wheat products for those reserves. Any such deductions of moneys for reserves are excluded from the GMP arrangement. Senator Rae stated that the provision legalises the Ceres House reserve which was identified by the Auditor-General as an illegal reserve; and asked why the Minister for Primary Industry is not required to approve the creation of financial reserves. With respect to the Ceres House reserve, the new provision does not legalise the current reserve as specific purpose reserves under the amended Act may only be created and funded from the sale proceeds of wheat and wheat products from the 1982-83 season onwards. The Ceres House reserve was created and funded prior to the 1982-83 season, and the opinion of the Attorney-General's Department has been sought on an appropriate method of quitting that reserve. This is not to say that a reserve cannot now be created by the Board for purposes such as the provision of AWB accommodation. The AWB's actions in setting up and funding reserves have not been made subject to ministerial approval; instead the specific reserves and their purpose must be disclosed in the Board's Annual Report (clause 16). Moreover the flow of funds out of the reserves are subject to Ministerial approval, if they are expended through contracts worth more than $100,000. Clauses 7 and 8: Clause 7 amends section 21 of the Act to enable the AWB to enter into optional arrangements for payment of the GMP entitlement to growers who deliver their wheat to or on behalf of the Board. Details of payment options are to be agreed upon between the individual grower and the AWB subject to equity between growers being preserved. Clause 8 amends section 22 (5) of the Act to remove the constraint that advances to growers on account of the final payment must be approved by the Minister. Senator Rae asked why requirements for Ministerial approval had not been included or had been removed in these provisions. The legislative provisions provide statutory criteria for any agreement made between individual growers and the Board. In these circumstances it will be a matter for the Auditor-General to be satisfied that statutory criteria are met in any of the agreements so made and to report to the Parliament if there are instances where he is not satisfied . The approval by the Minister of advances to growers on account of the final payment is unnecessary, since these advances can only be made after the Board has funded its borrowings for that season. The Minister's approval is still required for the essential elements of each pool, namely the determination of both the GMP and the final pool payments. Clause 17: This clause amends section 55 of the Act so that remuneration by the AWB for costs incurred by its authorised receivers will be at specified rates as determined by the authorised receiver from time to time and in accordance with remuneration agreements between the authorised receivers and the AWB in existence at the time. Senator Rae queried why the provision changes the previous arrangements so that the authorised receivers now determine the price to be charged without necessarily obtaining AWB agreement to the determined rate and stated that the AWB is not in a position to obtain an alternative service if it believes the rates of charge are unreasonable and that the bases of the charges are not subject to an audit to determine whether the rates are reasonable. He also queried whether there are any means by which the AWB may recover any overpayments to authorised receivers. The rates set by the authorised receivers and charged by the AWB are determined in accordance with the procedures and legal requirements of the States. Those procedures and legal requirements vary from State to State, but each has a statutory responsibility to a Minister of the State. The legislative provisions in each State place the responsibility for setting the rates on the receiver and the growers in the State. The AWB accepts the rates as determined by each authorised receiver under these arrangements. The amendment was designed to overcome the difficulty in the previous Act raised by the Auditor-General concerning the inability of the Board to ''agree'' to rates the setting of which is the responsibility of the authorised receivers. The authorised receivers' financial affairs are scrutinised by the relevant State auditors and made public through their Annual Reports. As the rates are set in advance, the question of overpayments does not arise. Senator WALSH —I now wish to refer to certain matters, on behalf of the Minister for Primary Industry, relating to the Australian Wheat Board. On 25 March 1983 the Minister granted a request by the Australian Wheat Board to extend the reporting period for its 1981-82 annual report from 31 March 1983 to 31 May 1983 . On 24 May 1983, he received a request from the Board Chairman for a further 60 -day extension until 31 July 1983. The Minister has granted this request and has asked me to explain to the Parliament his reasons for doing so and to take the opportunity to put on record his views on the Board's accounting problems. Honourable senators will be aware that the 1982 amendments of the Wheat Marketing Act changed the Board's financial year from December-November to October-September. This change affected the 1981-82 accounts. Honourable senators will also be aware of the difficulties that the Board has experienced with its accounts and financial statements. The financial statements have generally been late in presentation and have been accompanied by qualifications by the Auditor-General. Naturally, therefore, the Minister is keeping a close watch on the Board's attempts to overcome its problems. He has held discussions with the Auditor-General and with the Chairman of the Board to ascertain the progress which has been made. In addition, he has continued the practice of his predecessors whereby the Board provides reports to him on a quarterly basis on the progress made in overcoming the Auditor-General's qualifications. The Minister has asked me to inform the Parliament that in his opinion the Board is making significant progress. This view has been confirmed in his discussions with the Auditor-General and Sir Leslie Price, the Board Chairman. For example, one of the most serious qualifications of the Auditor-General has been that in his opinion the Board 'does not have proper accounts and records as required under section 63F of the Audit Act'. The basic reason for this qualification has been the Board's lack of procedures and controls to ensure the accuracy of information recorded on a pool basis, particularly in relation to stock handled by the authorised receivers. To overcome this the Board has recently resorted to itself establishing a task force to document the systems and procedures employed by each authorised receiver. The Board hopes that this exercise, which has now been completed, will provide the basis for the removal of the qualification. However, the time taken to complete the task has been a major reason for the delay in the presentation of the 1981-82 financial statements. The Minister wishes to make it clear that the Board requested the second extension because the Auditor-General's Office had informed the Board: . . . that there is no possibility that the Auditor-General's report upon the Board's 1982 financial statements, which were signed on 12 May 1983, will be available to the Minister by 31 May 1983. The Audit Office is, of course, most conscious of the Board's desire to report formally to the Minister on its operations as soon as possible, and is anxious to finalise the audit report. It is, however, a task that necessarily will take a deal of time. It is our view that a further 60 day extension of the time for the submission of the Board's report to the Minister ought to be sought. The Minister therefore decided to grant the second extension because the delay had been caused mainly by the action which the Board has been taking to improve its accounts and because the request is fully supported by the Auditor-General. The Minister gives his assurance that he will continue to monitor closely the Board's performance in this area and will keep the Parliament fully informed of developments. Senator PETER RAE(Tasmania)(4.18) — by leave-I move: That the Senate take note of the statement. There will be another opportunity-when the Wheat Marketing Amendment Bill comes before the Senate-to debate the information which has been provided by the Minister for Resources and Energy (Senator Walsh) and which has been incorporated in Hansard. The only comment I wish to make at this stage is that it is pleasing to note that the Minister for Primary Industry (Mr Kerin) is conscious of the incredible delays in the past in the preparation of the annual financial statements of the statutory authority which, I believe, certainly handles by far the greatest amount of money of citizens of Australia and which got as far as four years behind in the preparation and presentation of its annual financial statements. I was pleased that the statement said: The Minister has asked me to inform the Parliament that in his opinion the Board is making significant progress. One does wonder for how long it will be repeatedly said by Ministers, making speeches prepared for them by the Department of Primary Industry, that the Board is making significant progress or the Board is doing something to overcome the delays. It seems-I am sure the Minister for Resources and Energy and the Attorney-General (Senator Gareth Evans) have both heard this before from the Australian Wheat Board-that every step is being taken to overcome the problems, or it is making progress, or what have you. Without wishing to delay the Senate to comment particularly on the fact that it took from 30 June to the following 12 May for the Wheat Board actually to submit its financial statements to the Auditor-General and therefore, not unnaturally, the Auditor-General is not able to complete what is a very complex and detailed examination, I must, nevertheless, note it. I also do not wish to delay the Senate by dealing in detail with the problem about the deficiencies in the Board's lack of procedures and controls to ensure the accuracy of information recorded on a pool basis, particularly in relation to stock handled by authorised receivers. The Minister' s statement reads: To overcome this the Board has recently resorted to itself establishing a task force to document the systems and procedures employed by each authorised receiver. To the best of my recollection, without having had the opportunity to check, it was in April last year, at the instigation the year before last of the Senate Standing Committee on Finance and Government Operations, that that particular conference between the Wheat Board and the people who were involved as authorised receivers and the others necessary was held. I believe that the statement perhaps overstates the enthusiasm for the Wheat Board to overcome its problems and does not give credit to where the instigation for overcoming some of those problems may have come from. But I thank the Minister for the statement . As to the particular matters raised under the Wheat Marketing Amendment Bill 1982, I am grateful that the undertaking given by the former Government that the Senate would be informed about these matters has been honoured by the present Government. Debate (on motion by Senator Walsh) adjourned. Motion (by Senator Gareth Evans) agreed to: That leave be given to introduce a Bill for an Act to amend the Family Law Act 1975. Bill presented by Senator Gareth Evans, and read a fist time. Standing Orders suspended. Senator GARETH EVANS(Victoria-Attorney-General)(4.24) —I move: That the Bill be now read a second time. The law reform policy released before the election stated that a top priority for a Labor government would be the introduction of a Bill to propose overdue reforms of the Family Law Act. The Family Law Amendment Bill 1983 is the fulfilment of that promise. Any government that cares for people and is concerned to minimise unhappiness and social conflict must give paramount consideration to family law matters. Family law affects more Australians-adults and children-than any other single area of law. When marriages break down, for whatever reason, every effort must be made to ensure speedy resolution of differences with the minimum of trauma and expense and the maximum possible benefit to all parties. I believe it is overwhelmingly accepted that the Family Law Act was a landmark in social legislation. It was a great Labor achievement and is one of the enduring legacies of former Senator Murphy's time as Attorney-General. Its removal of the concept of matrimonial fault from the law relating to this most complex of human relationships was a revolutionary advance. Its establishment of the single ground, no fault divorce must on no account be jeopardised. Free from the burden of attributing fault, the Family Court can now concentrate on being satisfied as to the fact of marriage breakdown and on deciding the most equitable distribution of property, the proper level of maintenance and, of overwhelming importance, the best possible arrangements for the welfare of any children of the marriage It will be recalled that the Joint Select Committee on the Family Law Act recommended that there should be no change in the grounds of divorce, and that is the Government's firmly held view, as reflected in this Bill. Social legislation like the Family Law Act must, however, be kept constantly under review to ensure that it reflects changing social conditions and continues to achieve maximum public benefit. It is now nearly five years since the Joint Select Committee was appointed to conduct a comprehensive inquiry into the operation of the Family Law Act. It is almost three years since the Committee reported to the former Attorney-General, Senator Durack. The Committee made a large number of important recommendations which, regrettably, are only now being implemented. The Family Law Council, the Law Council of Australia, the judges of the Family Court and hundreds of individual Australians have made constructive suggestions for reform to the Family Law Act and the operation of the Family Court, many of which are taken up in this Bill. The primary point of reference has, nevertheless, been the admirable report of the Joint Select Committee, the majority of whose recommendations are being adopted, administratively or by this Bill. The Bill I introduce today will implement wholly or in part some 37 recommendations of the Joint Select Committee on the Family Law Act. A number of other recommendations have been implemented administratively. It will be recalled that the former Attorney-General introduced a Family Law Amendment Bill in October 1981, the purpose of which was to implement some recommendations of the Joint Select Committee. However, when Parliament was prorogued for the election in March this year that Bill had not even progressed beyond the stage of the second reading debate. In view of the long history of these amendments, I should make clear that all the amendments that were contained in the 1981 Bill and the further amendments foreshadowed by Senator Durack in March 1982 have been included in this Bill. We have decided to introduce a number of further important amendments, some of which were recommendations of the Joint Select Committee, others of which implement more recent recommendations of the Family Law Council. In particular, this Bill implements a number of recommendations of the Watson Committee, a committee of the Family Law Council which examined in depth a number of matters arising from the Joint Select Committee's recommendations concerning guardianship, custody and wardship proceedings. I will draw attention to these amendments during my remarks. The amendments contained in the Bill fall broadly into three classes: Those which expand the jurisdiction of the Family Court; those which relate to the structure and procedures of the Family Court; and those which affect the substantive law applied in courts exercising jurisdiction under the Act. Mr Deputy President, given time constraints and the considerable length of the remaining portion of the second reading speech, which deals in detail with each one of those three areas, I believe it might suit the convenience of the Senate were I to seek leave at this stage to have the remainder of the speech incorporated in Hansard. Leave granted. The remainder of the speech read as follows- Expansion of Jurisdiction of Family Court I will deal first with those amendments that propose an expansion of the jurisdiction under the Act to deal with proceedings concerning children and matrimonial property. It will be recalled that in recent years there has been increasing criticism from the High Court and other courts regarding what the Chief Justice, Sir Harry Gibbs, in the 1982 case of Fountain v. Alexander described as: 'the confusion and inconvenience that is caused by the fact that jurisdiction in cases relating to the custody of children is divided between State and federal courts'. As the Chief Justice went on to point out, this situation causes not only uncertainty for litigants but also costs to mount and delays to increase. It was therefore to be hoped, indeed expected, that when the State and federal law makers of Australia gathered in Adelaide a month or so ago for the Constitutional Convention there would be unanimous support for the proposal for a constitutional amendment to permit the Commonwealth to legislate for the guardianship, custody and maintenance of all children. Regrettably, however, support for the proposed constitutional amendment was not forthcoming at the Convention from Senator Durack and his Liberal colleagues, notwithstanding that the proposal had originated with and been promoted by the previous Government and by Senator Durack as Attorney-General. All the Convention achieved, as a result, was to bury the idea alive, by referring it to a Standing Committee of the Convention for further, quite unnecessary, consideration. There thus remain two classes of children in Australia: Those who have the benefit of federal law and a specialist court emphasizing conciliation, and those who do not. In these circumstances the recommendations of the Joint Select Committee that the Commonwealth legislate to the full extent of its powers in relation to children and matrimonial property, assume a new urgency. The amendments in the Bill which implement those recommendations seek to reduce, as far as constitutionally possible, the existing jurisdictional divisions in family law, and must be regarded as the most important in the Bill. In relation to the jurisdiction under the Family Law Act to deal with proceedings concerning children, this Bill proposes a three-way expansion. First , it proposes an expansion in the class of children with respect to whom guardianship, custody and like proceedings may be brought, to include not only ( as at present) the natural and adopted children of both parties to the marriage but also: a child adopted since the marriage by either party to the marriage with the consent of the other; a child of either party to the marriage who is ordinarily a member of their household; a child born to the parties (or in certain circumstances to one of them) as a result of either artificial insemination by donor or in-vitro fertilizaton; and a child who while not the child of either party, has been treated by the parties as a member of their family and who is ordinarily a member of their household (Clause 4). Secondly, the Bill will enable a person who is not a party to the marriage-for example a grandparent-to initiate proceedings under the Act against one or both parties to the marriage in relation to a child of the marriage. At the present time, where a third party wishes to institute such proceedings he or she must do so in a State court under State law unless the child has previously been the subject of proceedings under Commonwealth law. The Bill seeks to remedy this anomalous situation (Sub-clause 3 (1)). The third way in which the Bill will expand the Act's jurisdiction concerning children is to permit proceedings concerning the welfare of a child. These amendments reflect the Government's decision to implement the Watson Committee recommendation that the Family Law Act be amended to enable orders to be made for the protection of the welfare of a child of a marriage, thereby investing courts exercising jurisdiction under the Act with a power similar to the wardship power of the State Supreme Courts. The Joint Select Committee favoured the conferral of a wardship jurisdiction on courts exercising jurisdiction under the Act. The Watson Committee, however, concluded that while the substance of the jurisdiction was highly desirable, the terminology or concept of wardship, which the Committee described as 'archaic', ought to be abolished. In accordance with the Watson Committee's views, the Bill does not use the language of wardship but instead provides that proceedings concerning the welfare of a child of a marriage that involve at least one of the parties to the marriage are a matter, indeed an exclusive matter, for the Family Court. Although the relevant amendments in the Bill will prevent the State Supreme Courts from exercising ward of court powers in proceedings concerning a child of a marriage and involving a party to the marriage, I would stress that the Commonwealth does not propose to intrude into the area that is commonly termed State child welfare law. The relevant provisions of the Bill make this clear ( Sub-clause 3 (1)). At the same time, the Bill contains a provision to enable a court exercising jurisdiction under the Act to invite the intervention of State or Territory child welfare officers in proceedings affecting the welfare of a child (Clause 41). In relation to matrimonial property disputes honourable senators may recall that the original Family Law Act proposed that all disputes between a married couple concerning their custody, maintenance and property rights should be within the exclusive jurisdiction of the Act, irrespective of whether those disputes arose before or after divorce. As a result of the 1976 High Court decision in the Russell case, however, the present unsatisfactory situation has come about whereby custody and maintenance disputes can be determined under the Family Law Act at any time during a marriage or after its dissolution, while disputes as to property cannot be commenced under the Act until divorce proceedings have been commenced between the parties, following 12 months separation. In accordance with the recommendations of the Joint Select Committee the Bill proposes that proceedings with respect to the property of the parties to the marriage may be commenced under the Act at any time, whether before or after divorce, providing the dispute can be said to arise out of the marital relationship (Sub-clause 3 (1)). This amendment should ensure that all married people are entitled to benefit from the principles in the Family Law Act which are generally far more just than under State law, in that they permit a spouse who has contributed to the acquisition of the matrimonial property in an indirect or non-financial but nevertheless significant way to claim a share in the property without having to institute divorce proceedings. In relation to property proceedings I also draw attention to the fact that the Family Law Amendment Bill as introduced by the previous Government contained an amendment to permit property proceedings to continue after the death of one of the parties to those proceedings, In making an order in such proceedings, however, the court would have been restricted to making those orders which would have been available had the deceased party not died. This Government considers that the court in such circumstances ought to be able to make an order which takes into account the fact of death and the circumstances which exist following the death. The new Bill will achieve this purpose (Clause 31 and 32). There is one further area in which an expansion of jurisdiction of the Family Court is proposed by the Bill. I refer here to the amendments which will enable the Family Court in the Australian Capital Territory to be invested with as broad a jurisdiction as possible in family law matters. It is my hope, and the ultimate aim of this Government, that the Family Court throughout Australia will one day exercise such a broad jurisdiction. Procedures and Structure of Family Court Among the most important and necessary changes recommended by the Joint Select Committee in the procedural area were that courts exercising jurisdiction under the Act should be opened to the public and that the existing total prohibition on the publication of details of proceedings under the Act should be relaxed, provided that the parties to such proceedings were not identified. Although these recommendations did not have the unanimous support of all members of the Joint Select Committee, they were endorsed by the Family Law Council and were accepted by the previous Attorney-General. They are accepted by this Government and are implemented by this Bill (Clauses 46 and 65). It is this Government's view that much of the largely misconceived criticism to which the Family Court has been subject, particularly in recent times, should disappear when the court is open to the public and details of its operation in particular cases can be published. This, it is to be hoped, will enable better understanding of the way the court operates, and will promote an informed and constructive debate on the future development of family law. I am aware that certain honourable senators are concerned that to permit publication of details of Family Court proceedings will result in unwanted intrusions into the privacy of litigants. I would seek to allay those concerns by explaining that the Bill prohibits any account of proceedings under the Act which identifies a party to those proceedings. There are detailed rules as to what will constitute identification and steeply increased penalties for an infringement of the prohibition (Clause 65). Another important recommendation of the Joint Select Committee was that there should be a pool of Family Court judges from which Full Courts would be constituted to hear appeals. Certain of these judges would be permanent members of the pool; others would sit on appeals by rotation. The Bill as introduced by the previous Government provided for the creation of an Appeal Division the membership of which was to be fixed. This Government prefers the model suggested by the Joint Select Committee, whereby certain members of the Appeal Division will be permanent members and other members will be appointed for a limited period. The Bill accordingly proposes an Appeal Division comprising up to five permanent members together with an unspecified number of other judges who will hold appointment in the Appeal Division for two years only (Sub-clause 3 (1); Clauses 7, 8, 9 and 10). One of the most important additional amendments that this Government is proposing in the Bill relates to the allocation of work within the Family Court. At the present time a tremendous amount of judicial time is spent on very routine types of matters, in particular 'pre-trial' or 'duty' work such as the giving of directions regarding pre-trial procedure and the making of interim or consent orders. It is considered by the Family Court and the Family Law Council that if this routine type of work could be done by officers of the court other than judges, the judges would be able to devote more time to substantial defended matters, thereby achieving a more effective use of judicial time and a reduction in the delays in the hearing of matters before the court. Fortified by statements made by various members of the High Court in the 1982 case Commonwealth of Australia v. H.C.F. of Australia, the Government has therefore included provisions in the Bill to permit Registrars and Deputy Registrars of the Family Court, as officers who truly form part of the court's organisation, to exercise a greater range of powers in proceedings under the Act but subject always to review by a judge (Clause 66). I come now to that somewhat controversial amendment that will enable undefended divorce applications to be determined without the necessity for either of the parties or their legal representatives to attend a court hearing (Clause 47). The Government is aware that a similar amendment in the 1981 Bill attracted some criticism from certain groups. Nevertheless the Government is convinced of the value of this amendment as an important development towards streamlining the procedures of the Family Court and reducing costs to litigants. I would mention that there are safeguards, both in the amendment and in the Act itself, against divorce applications being granted in error under the new procedure. If the new procedure is to be used by a party, the other party will be able, by making a prior objection, to ensure a hearing of the divorce application. The court will still have to be satisfied, on the basis of evidence before it, that the marriage has broken down and that there is no reasonable likelihood of cohabitation being resumed. Further, before a divorce decree can become absolute , the court will still be required, except in special circumstances, to declare that it is satisfied that proper arrangements have been made for the welfare of any children of the marriage under 18 years. Other amendments of a procedural or structural nature that were proposed by the Joint Select Committee and which are included in the new Bill are: Amendments that will permit the judges of the Family Court to make Rules of Court, as do judges of other superior courts (Clause 68); amendments that will enable parties to make joint applications for divorce (Sub-clause 3 (1) and Clause 20); and amendments to expand the duties of a full-time Marshall of the Family Court ( Clause 13). One of the principal duties of a full-time Marshall will be, as recommended by the Joint Select Committee, liaison with the various police forces to ensure the more effective enforcement of Family Court orders. Changes to Substantive Law I come now to those amendments in the Bill which affect the principles that are applied by courts and the remedies that are available in proceedings under the Act. In relation to proceedings concerning children, the new Bill follows its predecessor by including an amendment permitting the Family Court to take into account any wishes of a child, no matter of what age, and to give to such wishes what weight it considers appropriate (Clause 25). This replaces that existing requirements that the court give effect to the wishes of a child of 14 years or over. The Bill also implements certain Joint Select Committee recommendations in relation to children which were not taken up by the previous Government but which are wholeheartedly endorsed by this Government. In particular, Government departments and other persons or bodies who have information concerning the likely whereabouts of a missing child who is the subject of a custody order may now be required to divulge such information to the court, subject to appropriate safeguards (Clause 25). The Bill also contains for the first time an express statement of the criteria that the Family Court must take into account in determining guardianship and custody matters. I am aware that the recommendation by the Joint Select Committee for the insertion of such criteria in the Act has not met with universal approval. We are, however, persuaded by the arguments advanced by the Joint Select Committee that such an amendment should assist the more rapid resolution of disputes over children by introducing greater certainty and predictability into the exercise of the Family Court's discretion in this controversial and emotive area (Clause 25). The Bill provides that there should be no final order in guardianship and custody cases until the parties have attended a conference with a court counsellor. This amendment reflects the philosophy of this Government that every effort must be made to resolve disputes by processes of conciliation and counselling and that recourse to the court and the adversary process must be a last resort (Clause 25). Another amendment, also recommended by the Joint Select Committee, that will contribute towards the protection and welfare of children is that which will permit the Family Court to attach a power of arrest to an injunction granted for the personal protection of either a child of a marriage or a party to the marriage. This Government believes that the Court should be able to attach a power of arrest order to an injunction not only where violence has already been committed but also where violence has been threatened, and the Bill provides accordingly (Clause 58). I would mention that this further amendment will result in greater consistency between the Family Law Act and the various recent State Acts which deal with domestic violence. The relevant provisions in the Bill have been drafted on the basis that the Commonwealth provisions do not operate to exclude effective State provisions in this area (Clause 58). Finally in relation to children, the Bill seeks to attribute some meaning to the hitherto undefined terms of 'guardian' or 'guardianship' and 'custody'. The Joint Select Committee recommended that these terms should be defined, and perhaps more importantly that their usage should be consistent with other Commonwealth and State legislation. The Family Law Council's Watson Committee recommended, after a thorough examination, that definitions be inserted into the Act. The Bill accordingly provides that a guardian of a child under the Family Law Act is the person who has the responsibility for the long-term welfare of the child-which according to the Watson Committee should include such matters as 'decisions concerning the (child's) education, changes in place of residence, religion, employment and any health needs other than of a routine or urgent nature'-as well as all the other powers, rights and duties that are vested by law or custom in the guardian of a child. It further provides that a person who has or is granted custody of a child under the Family Law Act has the right to possession of the child and the responsibility for the daily care and control of the child. The Watson Committee intended this responsibility to encompass ' decisions concerning accommodation, attendance at school, clothing, feeding, transportation, behaviour and urgent or routine health needs' (Clause 22). I am aware that these amendments will involve a departure from the existing practice and usage that has grown up under the Family Law Act, whereby ' guardianship' has more or less fallen into disuse and 'custody' has come to mean virtually the full legal rights in respect of a child. The term 'care and control', though not mentioned in the Act, is currently used to mean possession. Recognising that this course may cause at least some short term confusion, I am nevertheless persuaded by the arguments put forward by the Watson Committee in support of its recommendation. I would add that these amendments will achieve the Joint Select Committee's desire for uniformity in Commonwealth and State legislation. In relation to the Family Court's powers in property settlement proceedings, the Bill puts beyond doubt that the court has the power to adjourn such proceedings where this is necessary to enable ultimate justice to be done between the parties in cases where the financial circumstances of one of the parties are likely to change in the future (Clause 31). This will be particulary important where one party will in the future became entitled to superannuation benefits and there is at the time of the initial hearing of the application little other property for distribution between the parties. This Bill also proposes an extension of the range of circumstances in which the court may vary or set aside an earlier property settlement order (Clause 32). The Bill also revises, and relocates in the Family Law Act, the provisions of Part III of the Migration Act relating to offences for the removal from Australia of children in respect of whom custody or like orders have been made or sought. Increased penalties for these offences are provided (Clause 29). The relocation was recommended by the Interdepartmental Committee on Prevention of Removal of Children from Australia by One Parent in 1979. It will more effectively bring the offence provisions to the notice of the public and legal profession alike. Also relevant to the issue of the wrongful removal of children is the amendment in the Bill which enables regulations to be made to enable Australia to implement the Hague Convention on the Civil Aspects of International Child Abduction (Clause 55). I have high regard for the Convention's approach to the problem of international child abduction as it will ensure the speedy, almost automatic return of abducted children. It will not permit the abductor to make use of the custody jurisdiction of courts in the country of destination, thereby eliminating the advantage that sometimes accrues to an abductor by the passage of time. The Bill also makes the necessary amendments to enable Australia to accede to the Hague Convention on the Recognition of Divorces and Legal Separations ( Clause 49). These amendments will require Australia to recognize as valid legal separations of married persons effected under overseas law where the persons have the required connection with the relevant overseas country. Certain other amendments to enable accession are necessary, in particular amendments which will result in an Australian court being bound by certain findings of fact in overseas proceedings associated with a marriage, and also to modify the grounds on which recognition of an overseas divorce, decree of nullity of marriage or of legal separation of married persons may be refused in Australia. In addition the opportunity is taken to insert in the Bill a regulation-making power to enable Australia to implement the Hague Convention on the Recognition and Enforcement of Decisions Relating to Maintenance Obligations (Clause 55). No decision has as yet been taken on implementation of this Convention, as Government policy is to give priority to the long overdue implementation of the United Nations Convention on the Recovery Abroad of Maintenance, which I believe will provide considerable benefits for the ethnic community in Australia. As I mentioned at the outset, the Government regards the principle of no-fault divorce as accepted and settled. There is not the remotest prospect, in practical political terms, of a return to fault-based divorce. I hope therefore that debate on this Bill will be directed to the many important reforms it seeks to implement. I commend the Bill to the Senate. Debate (on motion by Senator Reid) adjourned. Motion (by Senator Gareth Evans) agreed to: That leave be given to introduce a Bill for an Act to amend the Migration Act 1958. Bill presented by Senator Gareth Evans, and read a first time. Standing Orders suspended. Senator GARETH EVANS(Victoria-Attorney-General)(4.29) —I move: That the Bill be now read a second time. This Bill is purely consequential upon the Family Law Amendment Bill 1983. It simply removes from the Migration Act those provisions of Part III of that Act, relating to offences for the removal from Australia of children in respect of whom custody or like orders have been made or sought, which are now inserted in a revised form in the Family Law Act. Debate (on motion by Senator Reid) adjourned. Consideration resumed from 26 May 1983. GROUP E Attorney-General's Department Proposed expenditure, $11,455,000. Department of the Special Minister of State Proposed expenditure, $11,998,000. Department of Foreign Affairs Proposed expenditure, $23,533,000. Department of Defence Proposed expenditure, $215,950,000. Department of Defence Support Proposed expenditure, $29,038,000. Senator Sir JOHN CARRICK(New South Wales)(4.31) —When the Committee last considered Appropriation Bill (No. 5) 1982-83 the Minister for Resources and Energy, Senator Walsh, who was in charge of the proceedings, made reference to information that had been sought and obtained by me in an Estimates committee relating to the availability of civil aircraft, whether government-owned or otherwise, for aerial photographic purposes in South West Tasmania. Some comment has been made on this matter by Senator Durack. I rise only because of Senator Walsh's comments, which were in effect that although a government civil facility was available it would not have been reasonably known by the Attorney-General's Department. I have to point out in simple terms these facts: As I understand it, before any use can be made of the defence facility it is necessary for it to be demonstated clearly that there are no civil facilities, wherever they may lie. That is something that must have been known to everybody. It must have been known to the Ministers concerned. It must have been known to their advisers. The fact of the matter is that many people, including honourable senators, must have known that this Government had such a facility. An important body of the Commonwealth Government is the Division of National Mapping. It produces maps for use Australia-wide. There has been debate in this chamber in the past about the purchase and maintenance of aircraft for the Division's use. In any case it is common knowledge, and should have been common knowledge to all honourable senators, that the Bureau of Mineral Resources, in the execution of its duties, must reply very heavily upon precise aerial photography. So one could have expected the advisers and the Ministers involved to know that civil aircraft facilities were available. At the Estimates committee hearing I asked the officer from the Division of National Mapping whether its aircraft was fully serviceable. The answer was yes. I asked whether it was available. The answer was yes. I asked whether it could undertake such precise photography as was required for South West Tasmania. The answer was yes. I asked whether any request had been made to use it. The answer was no. I went further, because it was important to know whether there was a much wider availability. Both the officer from the Division of National Mapping and the Director of the Bureau of Mineral Resources made it abundantly clear that very abundant, comprehensive and precise facilities were available in the civil field in Australia for the taking of aerial photographs and one could expect that they would be available at very short notice. I asked the officers to name the main firms that could undertake this function, and Hansard will reveal that it was suggested that there was a long and comprehensive list. I further requested the officers to give the names of the main firms. They have produced a list of nine firms, which I seek leave to have incorporated in Hansard. Leave granted. The list read as follows- Subject: Division 431-2-08 Contract Mapping Question: Senator the Hon. Sir John Carrick KCMG (Hansard, page 71) asked for a list of organisations that undertake aerial contract mapping in Australia. Answer: The organisations known to the Division of National Mapping that are able to fly aerial photography to mapping standards are: Aerial Surveys Australia, PO Box 15, Wembley, WA 6014 Aerometre, 52 Jephson Street, Toowong, Qld 4066 Airresearch Surveys Pty Ltd, 480 Ipswich Road, Annerley, Qld 4103 Australasian Mapping Services, 18 Finchley Street, Milton, Qld 4064 Australian Aerial Mapping, 786 Pacific Highway, Gordon, NSW 2072 Kevron Aerial Surveys, 121 Hill Street, East Perth, WA 6000 Northern Air Surveys, PO Box 53, Mt Molloy, Qld 4880 QASCO (NSW) Pty Ltd, 25 Seven Hills Road, Baulkham Hills, NSW 2153 Tucana Air Surveys, PO Box 377, Dandenong, Vic. 3175 Senator Sir JOHN CARRICK —The point I wish to make about this list is that the officers concerned have provided the names of organisations which have available facilities for precise aerial photography of the kind required which would be available with immediacy. So a clear pattern of evidence was established that the Commonwealth Government not only had available to it the facilities on immediate notice but also, even if that were not so, the outside world had an abundant supply. Indeed, as Senator Walsh commented, the Cessna aircraft of the Division of National Mapping, was standing in Melbourne with a capacity to do the job. It has been intended that it should go to Mildura or elsewhere, but it did not do so, due to weather conditions in Mildura. It is not a sufficient defence for any Minister to say that advisers in the Attorney-General's Department-or any adviser at all-would not have known that an aircraft existed in the Division of National Mapping. That is not the point. The point is that before any Minister seeks to obtain defence support for a civil purpose, it is necessary to illustrate and to prove clearly and comprehensively that no civil facility exists. The important error is that no attempt at all was made by the Attorney-General (Senator Gareth Evans) to seek any advice about whether a civil facility existed ; in other words, there was a complete breach of the rules and the protocol that are essential to the operation of the civil use of the defence arm. I only rose to speak because it looked as though the matter would be brushed aside by the casual excuse that the Attorney-General's Department was not to know that an aircraft or two were lying around belonging to the Division of National Mapping. That is simply not good enough and it was never good enough. After all, this is not a Minister who might not be expected to be knowledgeable in law. The Minister is the chief law officer. He is expected to know that in the use, and the seeking of the use, of a defence facility, he must first exclude the civil facility. He did not do so. There is clear evidence that no attempt was made to seek the use of government aircraft which were available. Astonishingly, an attempt was made to seek the use of a defence aircraft, but no attempt was made to seek the use of a civil aircraft. More importantly, even if he did not know that the Government had aircraft available, the question he should have asked-he should not have acted before he asked it-was: 'Is there an aircraft available for early use in the civil sphere to do this job?'. That was clearly not asked. The information was not sought at all. If it had been asked, abundant evidence would have revealed that civil aircraft were available. The clear evidence given at the Estimates committee hearing was that the action of the Minister in this case was in breach of the ground rules clearly laid down for the use of a defence facility for a civil purpose. I simply make clear that it is not good enough to dismiss the matter by saying that the Attorney-General' s Department would not have known that such aircraft were available. The Minister should have known about aircraft in the civil sphere. The evidence was available and it was not used. Senator SIBRAA(New South Wales)(4.40) —When the adjournment motion was put last Thursday evening, the Senate was dealing with the proposed expenditures considered by Estimates Committee E. At that time I had been defending my chairmanship of that Committee as well as Group Captain Waterfield, whom I believed had been put virtually on trial during the Estimates Committee hearings and had been questioned in a way that I considered was not appropriate for an officer in the Royal Australian Air Force. It is not my intention to have that debate take place again. However, I believe that this issue of RAAF flights over Tasmania has been blown out of all proportion and that an appropriate quotation from the Hansard report of the evidence given to the Estimates Committee supports my point of view. Senator Durack asked Group Captain Waterfield: Did you regard these flights as training flights? I interjected from the chair: I think this question has been asked before. Senator Evans added: In several different ways. Senator Durack then said: It has not been asked of Group Captain Waterfield, who authorised it. Did you regard these flights as part of the ordinary training flight exercise? Group Captain Waterfield then replied: I regarded the tasks as valid for the Royal Australian Air Force and of course there is training value in it. The point is that the hours that were used were operational training hours. The tasks that the aircraft undertook had training value in them. If the aircraft had not flown those hours on those tasks they would have flown those hours on some other tasks. In other words, Group Captain Waterfield, in answering a question from Senator Durack, pointed out that the so-called talk of spy flights was nonsense and, unfortunately, because of these remarks which I quoted, he was then subjected to a barrage of increasingly angry and bitter questioning which I believed that I, as Chairman, handled in as fair a way as possible to all concerned, including Group Captain Waterfield. I take this opportunity to put those remarks on record . Senator MARTIN(Queensland)(4.42) —I wish to speak very briefly in relation to the Estimates considered by Estimates Committee E. One of the matters I wanted to raise was one which, in a sense, overlaps that about which Senator Sibraa has just talked. I was not a member of that Estimates Committee. I believe that the questioning was very lively and that there may have been some moments when the Chairman had some difficulties. However, I just note that there are some statements on the record which should be taken up very briefly. I do not suggest this as a rebuke to the Chairman. It may be that he did not mean these words to have the meaning that they appear to have as they are reported in Hansard. I shall quote a couple of statements that the Chairman made in relation to a question when speaking to Senator Walters, who was a member of the Committee. The Chairman said: I suggest to Senator Walters that she direct her questions through the Minister . Later on, the Chairman said: If Group Captain Waterfield wants to answer, he can. It is up to the Minister's discretion as to whether he nominates him or not. Senator Evans, the Minister, then said: I have indicated to Group Captain Waterfield that I am prefectly happy for him to answer if he wants to do so. I just wish to place on record once again a matter relating to the entitlement of honourable senators to ask questions of witnesses. This is an old question which has been debated from time to time, but particularly vigorously in the early days of Estimates Committees. There is no doubt that honourable senators may ask witnesses questions of fact and it is not up to the Minister's happiness or otherwise whether those questions are answered. No witness has to wait for a direction from a Minister, but he may answer a question if it is a question of fact. The other point is that no honourable senator has to ask questions through a Minister. Honourable senators may ask questions directly of witnesses who appear at a committee. As I said, it may well be that just taking those words as they appear in Hansard might give a bit of a false impression. I think that the right of honourable senators in Estimates Committees needs to be guarded. I wanted to state that it appeared there that there might have been some infringement, unwittingly or otherwise, in the heat of the moment. There was another matter I wanted to raise very briefly, and it relates to the estimates for the Department of the Special Minister of State. I was unable to attend the Estimates Committee meetings in relation to this Department and subsequently I requested from the relevant Minister in this place, who is the Attorney-General (Senator Gareth Evans), the breakdown of an item which appears in the Supplementary Estimates, which relates to administrative expenses. The Minister has given me that breakdown. I seek leave to have the information incorporated in Hansard. Leave granted. The document read as follows- DEPARTMENT OF SPECIAL MINISTER OF STATE ADDITIONAL ESTIMATES Division 130 Sub-Division 2 Item 02 ''Purchase of Office Machines'' 2. Money spent to date has been spent on the following items: Minister's Office-Adelaide Word Processor 8,000 3 Typewriters 2,060 Photocopier 6,500 Franking Machine 1,260 *2 Vocadex Machines 17,018 Shredder 1,300 Dictation Machine 640 TV and Video 1,000 * 1 in Ministerial Office, 1 in Electorate Office. Minister's Office-Canberra Word Processor 10,000 3. The remaining $17,722 is unspent at this stage. Mary Bennett Acting Assistant Secretary 1 June 1983 Senator MARTIN —The item I had asked about involved a matter of $65,000 for the purchase of office machines. I note that included in this amount, not all of which has been spent-$17,772 remaining unspent-is expenditure on two word processors. One is in the Minister's office in Adelaide, at a cost of $8,000, and one is in the Canberra office, at a cost of $10,000. Of course, it is not unreasonable for Ministers to have word processors in both their electorate office and their ministerial office. I think it is also not unreasonable for members and senators to have word processors. I wrote to the Special Minister of State several weeks ago when an issue rose whereby I was due to get a new electric trypwriter in my office. I requested an electronic typewriter and said that I was prepared to spend several thousands dollars that would have been necessary to purchase the attachments needed for that typewriter to be used as a word processor. The Minister has replied that members and senators will not get access to these facilities. I think that is a great shame. Obviously Ministers are aware that these are indispensable items to the point where they need one in each of two offices. I certainly was not requesting that. The matter of provision of facilities of hardware to members and senators is, I think, basic in the conduct of our work. Before I was elected to the Senate I worked in university administration. Universities are not flush with funds and they certainly do not throw around their money buying fancy equipment for offices. However, the university did manage to keep up to date to the extent that there was access to the latest equipment in the relevant places. Since coming to this job I have found it quite appalling how we, who are supposed to have some hand in policy making and the running of the country, do not have access to equipment which would make us more effective and mean that our work was more efficiently done. I appeal to the new Minister, who has indicated that he is interested in members' and senators' facilities, to reconsider this item. Now that he has two new word processors-apparently he did not get any passed on from another Minister, which raises a question in itself-I ask that he rethink the matter of supplying members and senators with decent equipment. Senator WATSON(Tasmania)(4.48) —The debate on the unfortunate decision of the dispatch of a fighting plane to photograph areas of Tasmania in that part of the State where a dam is to be built is, indeed, unfortunate. I did not intend to enter this debate until the Chairman of Estimates Committee E made the unusual statement that this whole matter had been blown out of all proportion. In fact, he used the words of Group Captain Waterfield. Those words were: . . . there is training value in it. To say that it had training value in it is a far cry from saying that it was a training flight. To say that it had training value in it I suppose would be true for almost any sort of flight. A plane could be used to send a Minister from Canberra to Darwin, for example. It would have training value in it if the plane encountered storms, had to undertake certain navigational procedures and was used to get up hours, et cetera. Having training value in it is far different from a fighting plane being specifically directed to undertake this mission. In fact, what was required in the first place was a highly sophisticated F111 with specially fitted cameras. But on the day that plane was unavailable and another plane was dispatched. One could hardly say that the flight had training value and that it was a training flight because that flight happened to go below 1,000 feet. Some people have estimated that it went to about 200 feet on at least four occasions. So it actually dived into the valley. I am told that there was some cloud overhead and cloud actually in the valley. The flight certainly had a lot of training value in it. In fact, the pilot displayed a great deal of courage in the execution of that task. It was unfortunate for him that some of the photographic equipment on the Mirage was not all that marvellous. On returning to base and developing the photos, it was found that they were not up to standard. So what did the Government do the next day? It requisitioned another plane-a most sophisticated bomber specially converted for reconnaissance work, of which I think the Royal Australian Air Force has four-to go down to Tasmania specifically to take photos at 20,000 or 30,000 feet. We have to get this whole matter in perspective. It was an unfortunate incident . It created an unprecedented event, with the wealth of Commonwealth power being used against the sovereign State of Tasmania. No wonder Tasmanians have come up with the slogan: 'Protect State rights'. All around the world there is now a high degree of sympathy for the State. People see the situation in terms of a battle developing between a David and a Goliath. Tasmania is going to fight in this situation. The project involves State domestic expenditure, and the Commonwealth is trying to overcome that. If the Commonwealth wins this battle it will be the end of Federation. I have made this contribution to show that this matter has not been blown out of all proportion and, in any case, to use the words of Group Captain Waterfield, it has had training value in it, but it was not a training flight. Senator Sir JOHN CARRICK(New South Wales)(4.52) —I ask the Minister for Resources and Energy (Senator Walsh) whether, within reasonable time, he can obtain two costs for the Senate. I require first of all the cost of the journeys of the Mirage and F111 aircraft from their base and back in order to obtain the photographs and, secondly, the estimated cost of a commercial aircraft if it were chartered for the day to undertake that mission. Also, perhaps the Division of National Mapping can give an estimate of what the cost might have been had a Cessna aircraft performed that task. I think it would be instructive for all concerned to have those three costs. Senator WALSH(Western Australia-Minister for Resources and Energy)(4.53) —I will try to obtain the cost of hiring a charter aircraft to go down there and to do that job. I might also try to obtain the cost-I give no undertaking on this but I will make preliminary inquiries-of ringing every charter operator in Australia every time before someone asks the Royal Australian Air Force to drop some food on a flood-bound country town. I will ask for a statement of the hidden costs for the time Commonwealth officers would have to spend on the telephone ringing every charter operator in Australia to ascertain whether an aircraft is available to do the job. I will refer the question of costs incurred by the RAAF to the Minister for Defence (Mr Scholes). I think what Group Captain Waterfield stated before Estimates Committee E should be read again. He said: I regarded the tasks as valid for the Royal Australian Air Force and of course there is training value in it. The point is that the hours that were used were operational training hours. The tasks that the aircraft undertook had training value in them. If the aircraft had not flown those hours on those tasks, they would have flown those hours on some other tasks. Obviously it follows from that that it is a matter of judgment, prejudice, opinion, or whatever one likes to call it as to whether any additional costs were in fact incurred by using the aircraft for that particular exercise or for some other training exercise. In regard to the notional costs of operating the aircraft, I expect it would be possible to assess, at least on an approximate basis, the fuel it would use, the maintenance which would be required and the salaries of the officers. If Senator Sir John Carrick insists on attributing what the RAAF itself has said was a training flight to some other purpose, I will try to obtain the notional costs of so doing. Senator Sir JOHN CARRICK(New South Wales)(4.55) —Simply to clarify my request, I am requesting that precisely the same costing method be used that the Australian Labor Party in opposition always insisted should be used for costing VIP flights by Ministers and others. Since exactly the same argument could be used, that they were training flights and they could have been flying if they were not carting Ministers, my request is simply to apply the same test that the Labor Party always asked to be applied to all other flights. Senator WALSH(Western Australia-Minister for Resources and Energy)(4.56) —I apologise. The officers have just drawn my attention to the fact that the question which Senator Durack put to the Committee has already been answered. I quote: The additional costs incurred per hour of operation for F111 and Mirage aircraft are $3941 and $3265 respectively. These costs include fuel, spares and contractor servicing. They exclude fixed capital charges and service personnel cost. As explained to the Committee, which can be found in Hansard, pages 142-3, the hours flown were within the Air Force authorised flying hour program for 1982-83. Additional financial provisions were, therefore, not required in respect of these flights. Senator Sir JOHN CARRICK(New South Wales)(4.57) —At the risk of being tedious, I cannot know whether that method of costing is the same as the method used in the schedules of VIP flights which are tabled here. If it is, I would be grateful for the answer. If it is not, may I have in due course a costing on that basis? Senator WALSH(Western Australia-Minister for Resources and Energy)(4.57) —I am advised that the method of costing is basically the same as that used for VIP flights. If there are any minor differences, we will have the matter checked and supply the information to Senator Sir John Carrick. Proposed expenditures agreed to. GROUP F Department of Veterans' Affairs Proposed expenditure, $26,225,000. Department of Transport Proposed expenditure, $2,599,000. Department of Aviation Proposed expenditure, $36,763,000. Department of Administrative Services Proposed expenditure, $28,988,000. Department of Territories and Local Government Proposed expenditure, $9,006,000. Senator MARTIN(Queensland)(4.58) —I wish to direct a couple of comments with respect to the estimates for the Department of Administrative Services. I shall refer to a couple of small items first of all. In consideration of the Estimates last year there came up the matter of Estimates committee Hansards being delayed and how that had handicapped the effectiveness of Estimates committees. This issue was covered by Estimates Committee F with the Government Printer who assured us that measures had been taken to overcome the problems that had arisen last year. Since the Government Printer got such a thorough doing in the Senate in consideration of the Budget last year, it ought at least to be recorded that the speed of delivery of the Hansards was again excellent this year and they performed their usual function in relation to Estimates committees. One of the things I find Hansard very useful for is to check just exactly what questions I asked and, out of the plethora of questions asked, which ones I still require some information for and which answers are satisfactory. I draw the attention of the Minister for Resources and Energy (Senator Walsh) to a question I asked of the Department of Administrative Services. The question is to be found in the right-hand column on page 202 of the Senate Estimates Committee Hansard for 12 May 1983. I asked a question about the number of VDUs that were required for a departmental tender. Senator Walsh —Was that a particular tender? Senator MARTIN —I will read the section because a couple of tenders were mentioned. I asked: We are talking about the ADP procurement program. Does that include some visual display units? Can I ask how many are involved? Mr Low, who was a witness, answered: Originally it was something over 2,000. I understand that the current requirement for the Department is now over 4,000. That is for the Department of Social Security. Mr Palmer said: That was the Department of Social Security alone. It is not for the Public Service generally. I gather that there is a general tender as well for the Public Service. The Department of Social Security tender was a specific one. The witness said: I understood that was the one you were asking about. I said: Yes, it is. There is also, I understand, another tender out at the moment which has a more general description. The answer was: A period contract. I asked: How many VDUs are involved in that? The witness said: That, as you say, is more general. There is no precise figure allocated to that yet. Then I asked: You do not currently have an estimate that may be subject to review? The answer was: I will check for you if there is one, but nothing immediately springs to mind on that. I do not believe an answer to that aspect came. Could the Minister follow that up, because I am interested in the answer to that question? The other matter I wish to raise-- The TEMPORARY CHAIRMAN(Senator Haines) —I interrupt at this stage to say that at 5 p.m. the Senate will rise to present the Address-in-Reply to the Governor- General. If the Minister moves to report progress, Senator Martin, you may speak again later. Senator Walsh —Before I do, I ask that if Senator Martin has another question would she mind providing it to the officers immediately after the Senate adjourns so we can try to get answers to it by 8 p.m. Senator MARTIN —I do not have another question. I want to follow up some of the answers that were given to some questions. Progress reported. Address-in-Reply: Presentation to Governor-General The DEPUTY PRESIDENT —For the purpose of presenting the Address-in-Reply to the Governor-General, the sitting of the Senate is suspended until 8 p.m. Cars will be available at the front steps of Parliament House at 5.15 p.m. to take honourable senators to Government House. Sitting suspended from 5.2 to 8 p.m. The PRESIDENT —I inform the Senate that this afternoon, accompanied by honourable senators, I presented to His Excellency the Governor-General the Address-in-Reply, agreed to on 25 May, to the Speech by His Excellency on the occasion of the opening of the Parliament. His Excellency replied, thanking the Senate for the Address-in-Reply and indicating that he would be pleased to convey to Her Majesty The Queen the message contained in the Address. Consideration resumed. Senator MARTIN(Queensland)(8.2) —Prior to the suspension of the sitting I was speaking on the estimates for the Department of Administrative Services. I had indicated to the Minister for Resources and Energy (Senator Walsh), that I wanted to raise a couple of items very briefly in relation to answers that had been given. I had also indicated that I believed I had not received a reply to one question that I had asked in the Estimates committee hearings. Perhaps he could indicate in due course whether he has a reply to that question, which related to visual display units. The other point that I want to raise, and I shall do so quite briefly, relates to the purchase of properties by the Department of Administrative Services. During the Estimates committee hearings I had cause to refer to some of the lists which are presented to the Senate from time to time and which set out either the purchase or leasing of properties by the Department either on its own behalf or on behalf of other departments, for various purposes. There had appeared on the lists what appeared to be some rather curious purchases. I received what I think was quite a satisfactory response, in that what appeared to be an inordinately high number of purchases of staff residences for departments turned out to be cases in which officers were transferred and were unable to sell their homes. Apparently, after a certain length of time, the Department purchases the properties and subsequently resells them. I wish to make a simple request. Could the Minister in future perhaps indicate on such lists, as simply as that can be done, purchases which come into that category, namely those in which officers have been transferred, have been unable to sell their homes and the homes have been purchased by the Department at the valuation stated, versus those cases in which the Department actually purchases properties for other departments to keep? That would make a lot easier the understanding of those lists. It would also be interesting-and I indicate to the Minister that I will pursue it at a future time-to learn the inventory of properties which the Department holds and which come into the category of properties of officers who have been transferred. What is the profit or loss situation on such items? I do not intend to pursue the matter at the moment. I indicate that in general I found the answer quite satisfactory. However, I wanted to query one case. I queried during the hearings the matter of the Department of Administrative Services purchasing two staff residences at Burleigh Waters which is, of course, part of the resort of the Gold Coast. They were described on the sheets as staff residences required by the Department of Administrative Services. I was passing curious as to why the Department would require staff residences on the Gold Coast. The purchase of staff residences where people are transferred to remote localities and are provided with a home under those circumstances is quite legitimate. It seemed to me that the Gold Coast was neither a remote locality nor a place where there was a shortage of accommodation, for either purchase or rental. I want to note in the Hansard record an answer that I got in relation to that. The answer stated: These residences are required for the housing of Australian Federal Police officers based at Coolangatta Airport. Provision of these houses was considered justified on the grounds that there was not an acceptable rental/ purchase market in the locality. Police officers are posted to this holiday resort locality for a maximum term of two years and market conditions were such that leases of accommodation, other than on a short- term basis of several months, were not readily available. I have been tempted to contact a real estate agent or two on the Gold Coast to get their opinion on that reply. I suspect something is left out. There is a highly acceptable rental and purchase market in the locality of the Gold Coast. It is not just a holiday resort; it has a large permanent population. Many homes come in the category of permanent residences which are not highly priced. I noted that because it seemed that perhaps the answer I was given was not as full as it could have been, given that the Department had given me the guidelines for , or the conditions under which, it purchases homes. Whilst the wording used in the answer certainly seems to fit into that category, I am not persuaded by that fairly broad statement that the detail justifies the purchase of those homes. I do not want to go into the detail of the purchase of every home by every department, in the Senate, during Estimates committee hearings or whatever. I picked that one up simply because I felt there must have been more to that case. I was not satisfied with the detail of the answer given. It sometimes happens in Estimates committees, particularly when one subsequently is given information, that the information one is given is fairly scanty. One of the great shortcomings of considering estimates in the Committee of the Whole is that one cannot follow through in detailed cross-examination and extract information as one can in a committee. I think there are cases when we would like to have witnesses before us explaining their answers at greater length. When we receive written answers subsequent to committee hearings and we feel a little dissatisfied with them the only action we can take is to make mention of them here. This is one such case. I bring these matters up in the hope that the Senate, under its new regime-a new government which has indicated that it hopes to bring in various parliamentary reforms-will address itself very seriously to the subject of reform of Estimates committees and how they can be made more effectively to serve the purposes of the Senate. Senator WALSH(Western Australia-Minister for Resources and Energy)(8.8) —In relation to the first question, I have been advised by the Department of Administrative Services that there is a period contract for the supply of terminals with Raytheon International Data Systems. The Commonwealth Purchasing Manual states: A feature of the period type contract is that although estimated requirements are provided the Commonwealth does not bind itself to order any specific quantity, nor in fact any quantity at all. This type of contract lays down the prices, rates and conditions under which goods are to be supplied if they should be ordered during the period. Each individual order placed is subject to the agreed conditions and constitutes an acceptance of the continuing offer available to the Commonwealth under the contract to the extent of the quantities of the goods and services set out in the order. The Department is also advised that DAS does not have information on the number of units purchased by individual departments. Tenders have been called for a new period contract because the original contract has been in force for over two years. Those tenders are currently being evaluated. I am advised that the information that Senator Martin required on the more general question regarding housing will be supplied as soon as possible, although I do not expect that to be tonight. Finally, with regard to the two police officers at Burleigh Waters, I am advised that the residences in question are required for the housing of Australian Federal Police officers based at Coolangatta Airport. Provision of these houses was considered justified on the grounds that there was not an acceptable rental-purchase market in the locality. Police officers are posted to the holiday resort locality for a maximum term of two years. Market conditions were such that leases of accommodation other than on a short term basis of several months were not readily available. Senator MARTIN(Queensland)(8.10) —I wish to speak very briefly about the Australian War Memorial, an item which comes under the National Capital Development Commission. On 5 May 1983 I raised in the Senate on the adjournment debate the subject of modifications to the Australian War Memorial. On that occasion the Minister in the chamber was Senator Button. He indicated that he was not able to give me a detailed reply to my question which was a reasonable response at the time. However, he did say that he would request his colleague the Minister for Home Affairs and Environment (Mr Cohen) to examine the matter as soon as possible and respond to my suggestions in the Parliament as soon as he could. There has been no response. However, there has been some informal contact between me and the Minister on the issue. It was suggested that we might get together to talk about the matter but it has not been possible. I indicated to the Minister that I would probably raise the subject on the Estimates committees. I do so now because we are so close to the end of the parliamentary session and I have not wanted to push the issue unduly without proper discussions with people. However, some scaffolding has been erected at the War Memorial. The matter of modifications to the War Memorial has become fairly controversial and it would be derelict of me not to take this opportunity to press the issue a little further. The design modifications have been undertaken by the NCDC. As I understand it, one of the reasons that no further progress in the scaffolding has been achieved is that there is some dispute about the matter between the NCDC and the War Memorial authorities. To reiterate very briefly, some modifications which affect the entry are under way at the War Memorial, the basic purpose of which I certainly have no objection to. I think those who are objecting to the changes also do not have any objection to them. The entry to the War Memorial and things associated with it were designed for another time and they are inadequate for the number of visitors who pass through the Memorial each year. The concern is that the modifications will take on a nature which goes past that purpose. They will fill in the two pillars which currently frame the Hall of Memory. They will intrude visually into the courtyard and, in my opinion, will intrude to some extent onto the arches behind which the Roll of Honour is presented. I understand that at the moment there is an impasse about the structure. It is glass and we are told that it will not impede views. I do not think views are the central issue. The central issue is what the War Memorial means to the people of Australia and what the impact of that very unique building is on those who visit it either out of curiosity or reverence for what it represents. There is a suggestion that the glass structure will be etched which will, of course, block all vistas and certainly block any view of the Hall of Memory as one approaches the War Memorial. I emphasise that the Hall of Memory is the focus of the War Memorial. To many people it is what it is all about. As one approaches it it is framed between two pillars. It is capped by a very handsome dome which has a meaning of its own once one goes inside the Hall and sees what is inside the dome. The structure envisaged would block out altogether the framing of that focus from the outside of the building. The dome is visible from most of the approaches to the building but from some parts of it it is not. I do not think the dome is the issue. The Hall of Memory and what that represents is the issue. The inside part of the War Memorial is also affected. I believe that the War Memorial authorities want clear glass and see that as some solution. I am not sure that that is a solution. It is not for me to make suggestions on changes in design. However, there is great concern about changes to the War Memorial. Many people have very passionate views on what this ediface represents. At this stage news about the changes has not extended far beyond Canberra because there has been no publicity outside Canberra. However, people in Canberra are now expressing very strong views about the changes. My purpose in rising is to say to those in authority-the National Capital Development Commission, which I understand is doing the work and the planning, and the War Memorial people, who I admit do not come under this appropriation- please to hold off and make sure that the total design alterations are necessary and are the best not just artistically but for the purpose they are designed to serve. I also ask that account be taken of the very deep feeling that many Australians have for this building and for what it represents. We need to make sure that, in the name of what appears to be basic structural alterations to a building which is very dear we do not alter something in a way which people will find quite offensive. I appreciate a lot of the work that the NCDC does. It does some excellent work in Canberra. This is a fairly minor item in the Commission's entire work in terms of money and structure. But in terms of significance to the Australian people it is a major item. Senator WALSH(Western Australia-Minister for Resources and Energy)(8.17) —There are no representatives from the National Capital Development Commission here tonight. However, my attention has been drawn to an answer to a question from Senator Reid-the reference is page 195 of the Hansard record of Estimates Committee F-regarding planned alterations to the Australian War Memorial. The answer is a page and a half long. If the honourable senator wishes, I can read it to the Committee. Senator Martin —No. Senator WALSH —I would not claim that it comprehensively covers the matter raised by the honourable senator but it is relevant to it. I seek leave to incorporate the question and answer in Hansard. Leave granted. The document read as follows- SENATE ESTIMATES COMMITTEE F Outstanding Answers to Questions asked at the Committee's Hearing on 12 May 1983 Senator Reid Hansard reference-Page 195 Division 834 Question: Senator Reid asked whether planned alterations to the Australian War Memorial would result in the view of the dome being cut out. Answer: 1. In 1979 the National Capital Development Commission commissioned a report on building deficiencies at the Australian War Memorial by Mr Robin Wade, an expert on museum design of international renown. Amongst the problems identified in the report were: The cramped nature of the existing entrance to the War Memorial; the confusion experienced by visitors at the entrance; the lack of visitor and staff facilities appropriate to such a major institution. 2. In response to the report the Council of the War Memorial considered that priority should be given to improving space and facilities for visitors (visitor numbers having increased tenfold since the building opened to be nearly one million per year). The Council decided that the improvements should be achieved by upgrading the existing entrance. 3. New facilities were proposed in the existing gallery space to the sides of the new entry. However, to provide circulation through the galleries and to allow visitors sufficient space in which to pause and reflect, the new entry was required to extend into the courtyard. 4. A double height entry has been designed to greatly enhance the views into the courtyard from the entrance and to preserve views of Anzac Parade and Parliament House from the steps of the Hall of Memory. Such an arrangement had been part of the competition entry of Emil Sodersteen, the architect primarily responsible for the design of the original building. 5. The present design includes an enclosed upper level gallery linking the two existing pylons, providing, for the first time, an enclosed viewing platform at the southern end of the building and an all weather link between the two cloisters. This two-storey entrance will preserve the view of the Dome from most vantage points. From the south side of the Lake and from the entire length of Anzac Parade, the Dome will be visible above the new facade. Only from the external Rememberance Stone will the view of the Dome be partially obscured, and of course, the Dome is then fully screened from view as the visitor passes through the lobby as is now the case. 6. Once inside the building the commemorative elements can be seen together; not only the Dome but the entrance to the Hall of Memory, the courtyard and its pool and fountain, the cloisters and the Roll of Honour. Visitors will thus be encouraged to pause and reflect on the rememberance purpose of the War Memorial, before moving into the museum areas of the building. 7. It is the strong opinion of the Council that the view on entering the building should be such as to emphasis the memorial courtyard and the Dome of rememberence. Everything else is subordinate. The function of the large clear glass windows is to provide this view. The northern wall of the new entry foyer along with the side windows and the skylights all work together to give the visitor a feeling of rememberance and an appreciation of the building's role in expressing an important aspect of Australia's history. Senator WALSH —If any further information can be supplied, it will be provided as soon as possible. Senator MARTIN(Queensland)(8.18) —I would like a response from the Government to the matters I raised during the adjournment debate on 5 May. The responses that I have had have been informal. I would like an undertaking from the Government that it is actively looking at this matter, taking on board the concern that has been expressed and that it will attempt to achieve the objectives to which I have referred? Senator WALSH(Western Australia-Minister for Resources and Energy)(8.19) —I had no notice of this matter and I am not able to respond on behalf of the Government. I will approach the Minister for Territories and Local Government ( Mr Uren) and see what response can be obtained. Senator Martin —Perhaps you could give a brief response before the end of the session. Senator WALSH —I am not even sure where the Minister is at this stage but we will see what can be done. Proposed expenditures agreed to. Remainder of Bill-by leave-taken as a whole, and agreed to. Bill reported without requests; report adopted. Bill (on motion by Senator Walsh) read a third time. Consideration resumed from 12 May, on motion by Senator Button: That the Bill be now read a second time. Question resolved in the affirmative. Bill read a second time, and passed through its remaining stages without amendment or debate. Consideration resumed from 12 May, on motion by Senator Button: That the Bill be now read a second time. Question resolved in the affirmative. Bill read a second time, and passed through its remaining stages without amendment or debate. Debate resumed from 31 May, on motion by Senator Gietzelt: That the Bills be now read a second time. Senator Dame MARGARET GUILFOYLE(Victoria)(8.24) —Mr Acting Deputy President, two significant Bills are before the Senate this evening, namely, the Taxation ( Unpaid Company Tax) Assessment Amendment Bill and the Taxation (Unpaid Income Tax-Dividends) Bill. I make clear at the outset the Opposition's rejection of these Bills. It was claimed by the Government to be an extension of the recoupment legislation of last year. It in no way could be described in that manner, but we must see it as the first and opening salvo of the Hawke Government in taxation legislation. It states that it will collect something over $500m. If we recall some of the statements of Mr Hawke last year when he was commenting on the ready availability of large sums of money in the Australian community from tax avoidance and evasion, he was talking about something like $15,000m. If we look at this legislation as being the way in which the Government seeks to raise something over $500m, we must ask: What is the form that the next legislation is to take that we can expect from a government that introduces Bills and exposes them as being an extension of the recoupment legislation of last year? A promise was given by Mr Hawke that there would be no introduction of capital gains tax by a Hawke Labor Government. I would have to argue that the legislation before us does just that; it introduces a tax on capital gains and taxes wealth. It also applies legislation retrospectively to both those areas of growth. In no way would I describe it as an extension of last year's recoupment legislation. The legislation last year was designed to recoup tax that was due and payable. The then Government was not seeking to create a new tax liability. The legislation that is before us this evening is retrospective in every sense of the word in its intent and its application. The Bills create a liability which never previously existed. They are not normal, revenue raising Bills. I speak on behalf of all the members of the Opposition when I say that we adopt the same stance to these Bills as we did last year. In fact, many of the provisions that are before us in the legislation this evening reverse amendments that were specificially inserted in the previous Government's Bills last year, or they propose changes which were specifically raised by the Labor Opposition last year and rejected by us when we were in government. I repeat that the tax introduced under this legislation is a new tax. As I assert that without equivocation I think it is timely to query the title of the Taxation (Unpaid Company Tax) Assessment Amendment Bill that is before us. I think we need to ask: To what unpaid income tax is the amending Bill directed? No unpaid income tax is assessed against shareholders independent of the principal Act. That part of the name of the Bill 'Unpaid Company Tax' gives the impression that something is unpaid, whereas the Bill introduces and imposes a new tax. If the shares had not been sold there would not have been the type of tax burden to which the amending Bill is directed. Firstly, if the company were to continue to operate, dividends from current year profits alone after retention would have been declared which would not have involved accumulated profits from previous years which had already borne tax, nor would it have involved capital profits not subject to tax in the hands of the company. Secondly, if the operations of the company were to be discontinued it would have been put into liquidation. Distributions by the liquidator, to the extent that they represented capital profits, would not have been regarded as dividends in the shareholder's hands. Thirdly, it would have to be said that no one would have taken the step, upon which the amending Act appears to be based, of converting the company's assets to cash and then declaring a dividend from both revenue and capital reserves. This legislation proposes to tax both the accumulated profits and the capital reserve of the company. The accumulated profits previously would have borne company tax at the rate of 46c in the dollar and undistributed profits would have borne tax at the rate that was specified under the Act at the time. On top of that, under this Bill, there will be a further tax of 60c in the dollar. Senator Walsh —Not necessarily. Senator Dame MARGARET GUILFOYLE — Tax will have to be paid at a rate of up to 60c in the dollar. It is a capital gains tax or, more accurately, I think it is a wealth tax. The legislation is such that it reaches far back into the company' s history, into the operations of the company. It imputes and deems certain circumstances that are described throughout the legislation that did not happen. It seeks then to tax the result of those things which the Bill deems to have occurred. It exemplifies another broken promise, that there would be no capital gains tax. I think that was a special and unequivocal promise of the Government. It was a policy promise, a promise of the now Prime Minister (Mr Hawke). This legislation not only breaks that promise but also breaks with it restrospective effect. If the amendments to the definitions of the promoter's recoupment tax and the vendor's recoupment tax and the newly defined dividend recoupment tax are meant to enable the Commissioner of Taxation to recover additional tax assessed against the company under section 226 (1) of the Income Tax Assessment Act, the question must arise: Why should a vendor of shares be penalised three times for the company's failure? For example, if it is proposed that a vendor-shareholder pay the additional tax as part of his recoupment tax, he is penalised once. The amending Bill proposes to assess the vendor-shareholder, to tax upon a dividend amount under clause 12 determined by the distributable amount-clause 8, page 6- which is to be determined after deduction of the company tax liability, as shown by clause 8 (3), page 7. But the amount of the company tax liability does not include additional tax under section 226 (1) of the Income Tax Assessment Act, as shown by clause 8, page 7, paragraph 4 (c) of this Bill. Thus the shareholder is penalised a second time by his dividend amount not being reduced by the amount of the additional tax. By the Government seeking to impose the tax as part of the vendor-shareholer's dividend recoupment tax, the vendor-shareholder is penalised a third time in respect of the same additional tax of the company. No doubt if this is not the intent of the Government a series of very complex amendments could be raised to deal with what seems to be an absurdity, but that is what is provided in the Bill that is before us and, as I am advised, that is the effect of the Bill that is before us. Considering the consequences of the Bill, it can be described only as punitive. Its intent is enshrined in a dogmatic philosophy which is intolerant of the holding or building of capital. We have seen that sort of dogmatic philosophy reflected in the superannuation debacle which is presently before the Australian community. We see it in the speeches and comments of members of the Government and members of the Australian Labor Party. The legislation before us exemplifies the enshrining of a dogmatic philosophy which is intolerant of the holding or building of capital. I think it was said at the time that some of these decisions were taken that the Government would make some tough economic decisions. This legislation before us could in no way be regarded as tough economic decisions because they are punitive decisions. They are destructive decisions. They are destructive of companies; they are destructive of employment opportunities. They also ignore a policy of the present Government with regard to the retention of profits in a business, as is provided for under Division 7 of the Income Tax Assessment Act. Because they ignore that retention of profits properly in a business for the building of capital, the building of resources within the business, they sit very uneasily with another Government policy promise-to move to 100 per cent retention of profits in the business to assist small businesses to accumulate their capital, to employ their capital, to provide employment and to assist in the economic growth of Australia. This is another broken promise applied retrospectively over the years of the accumulation of the capital of the company . In recent days in Canberra I am sure that every senator has had representations from numbers of concerned people in regard to the application of this legislation to their own businesses. We have had examples galore given to us- perhaps some of my colleagues will wish to express those examples in more detail -of the effect of the legislation on the operations of companies. We have had many expressions from prominent and talented members of the legal and accounting professions who have described to us the effect of this legislation. The new tax is imposed on companies that have borne tax according to the law at the time. The legislation reaches back in some cases for 50 years or more. These are companies that have borne the tax according to the law that applied to them. For this reason, the retrospectivity of this legislation is absolutely abhorrent. The Law Council of Australia has provided some very thoughtful examination of the Bills before us. The Taxation Committee of the Law Council of Australia and many of the State divisions, together with other independent council and tax accountants, have provided a great deal of information. I am sure many honourable senators are in possession of the sort of information that has been provided. When the Taxation Committee of the Law Council of Australia describes the Bill as one that is designed to impose retrospectively a liability for taxation on former shareholders of companies, and when it expresses its view that it opposes that retrospectivity, we should look at the Bills to see exactly what their effect is and the retrospective nature of that effect. The legislation eliminates the right of former shareholders pursuant to section 3 (12) of the 1982 Taxation (Unpaid Company Tax) Assessment Act. That is a matter that concerns the Taxation Committee of the Law Council. The proposal to eliminate the provisions of paragraph (h) of sections 5 (1) and 5 (2) is an attempt to deem certain arrangements which did not have the effect of making it impossible for the company to pay any unpaid tax to be arrangements which did have that effect. To deem something to have occurred that did not have the effect of making the company unable to pay its tax seems to be a very inappropriate form of legislation for a government to impose. The Law Council is particularly concerned about the proposals in paragraphs 5A, 6A, 6C and 6E. It finds them entirely objectionable. It draws attention to the 1977 High Court decision in the Slutzkin case. It is well accepted by everybody that the form of this legislation certainly overturns the judgment in that case and the application of the law. Former shareholders of companies who disposed of their shares have always had the expectation that no part of the receipts on the sale of their shares would be deemed to be a distribution of the undistributed profits of the company. That is nothing new. That is an expectation that has always been accepted and understood. Moreover, the effect of the Bill will be to deem accumulated capital profits of companies to be dividends. As we have heard around the Parliament in the last day or two, that is something that concerns not only people who have their businesses at risk but also those of use who are parliamentary representatives. When I say that I understand that I speak not only for this side of the chamber but also for members of the Government's party who are concerned about the effect of accumulated capital profits under this legislation . The present proposal seeks to impose a further liability on former shareholders of companies. To deem accumulated capital profits to be dividends, as is done in this legislation, is of very great concern and will have enormous consequences. It is one thing to talk of collecting retrospectively tax which was due but upaid. It is entirely another thing to collect retrospectively an entirely new tax. That is what is being done in this case. I said earlier in my remarks this evening that we are looking at a capital gains tax. It has also been put to me that it is nothing less than a wealth tax. It goes beyond a capital gains tax because shareholders are to be taxed on a notional but unreal accretion in the value of their shares when they have neither sold them nor taken any part, especially in the case of shareholders in public companies, in the sale of shares in subsidiary companies and their ultimate disappearance. No justification exists for deeming profits to be distributed and to be taxable in shareholders hands when they are either of a capital nature or are tax-paid profits of previous years. It is quite inconceivable to me that any company would distribute these as taxable dividends . A number of sections have been expressed as being of great concern. Section 6 ( 2) provides that if there are any sales of shares in a vendor company the liability for dividend recoupment tax can be shifted from the company to the shareholders if the Commissioner thinks it would be unreasonable to assess the company. That would require some interpretation and some description. Section 21 has been restored to the Bill to allow time for payment, but it does not apply unless all shareholders wish for time to pay. This, of course, affects shareholders who may wish to have their right to pay by instalments or whatever other arrangement they may wish to make. So an amendment introduced by the Government after the legislation was brought down is not something that necessarily will help all people, but that is how the Bill stands at present. What concerned me when looking at the debate in the House of Representatives was that the Minister for Finance, Mr Dawkins, made a purely political response to what is a most significant piece of legislation. No attempt was made in the summing up of that debate to explain the legislation and there was no debate in the Committee of the Whole. No opportunity was taken to explain, to expand or to respond on the points that had been raised by the honourable members who had spoken in the debate. In fact one rather chilling thing that was said by the Minister was that retrospectivity is a most effective weapon. One must ask: 'A most effective weapon against what?' Retrospectivity in legislation is a most effective weapon if one wants to change the rules. It is a most effective weapon if certainty in the rule of law and in business is to be destroyed. It is a most effective weapon if one wants to destroy capital accretion. It is a very destructive way in which to provide legislation that has to be accepted through the Parliament. It has to be assumed that we have a very destructive Government if retrospectivity is to be the most effective weapon as a measure of its legislative program. Retrospectivity that destroys the certainty that people need to have to uphold the rule of law and to be able to determine their affairs is, I think, a reprehensible way in which a government can approach its legislation. When it is as far reaching as this income tax legislation it is something of very great concern. It may well be asked why there is such concern by business about the effect of the legislation. We cannot look at anything that affects business at present without looking at the conditions in our economy, the current recession and the difficulties. Because of the current recession, the real net worth of business is less than existing recoupment tax plus 60 per cent of real reserves, let alone plus 60 per cent of book entry reserves. That is why concern is being expressed all round the business community that this legislation will result in a financial wipe-out and in the destruction of business and employment. We are looking at what a business is able to do in the present circumstances of economic difficulty. While it is paying its way with the ever-increasing wage demands and other demands that are made upon it we are asking it to pay a tax of 60 per cent on its accumulated reserves and profits on which it has already paid tax. It seems to me that this legislation could not find support in the Australian Parliament because it would not find support amongst the Australian people. There are a number of speakers who will wish to make points on the legislation and to describe their reaction to it, or their party's reaction to it, but I wish to state on behalf of the Opposition that we are totally opposed to it. We are aware of the serious consequences which will be introduced into the business community through this legislation. The application retrospectively of a tax of this nature is something that should not find support in the Australian Senate. The ACTING DEPUTY PRESIDENT(Senator Colston) —Before I call the next speaker I want to mention that visitors are always welcome in this chamber, but I would point out to one of the visitors that we follow certain conventions here and some of the rulings made in the House of Commons. One of the rulings was made in 1947 when the Speaker said: In this Chamber, one does not smoke, one does not chew gum, one does not eat chocolates and sweets-and one does not peel and eat an orange in this Chamber either. Senator WATSON(Tasmania)(8.47) —As we debate these two Bills, the Taxation ( Unpaid Company Tax) Assessment Amendment Bill 1983 and the Taxation (Unpaid Income Tax-Dividends) Bill 1983, I want to point out that we are breaking new ground. This legislation imposes entirely new taxes. It is imposing a capital gains tax which is retrospective, discriminatory and blatantly unfair in a number of areas. Under this legislation the realisation of some property which could been held for generations, passed on from father to son-property which could have been held for over 100 years-is now to be regarded as profit if that transaction occurred between 1972 and the date of the introduction of the new Part IVA of the income tax legislation. The Government has introduced perhaps the most discriminatory form of capital gains tax ever placed before any parliament anywhere in the world. That shows the extent of this legislation. I am sure that the Government, in framing this legislation rather hastily, has failed to take into account all the consequences that will flow from it. As little as $101 tax on current year's profit could render perhaps millions of dollars worth of capital gains being subject to income tax under this legislation. Admittedly, that $101 would have to flow to the principal shareholder, but that is the trigger mechanism. How is this legislation going to work? It is unreal because traditionally, in this country, we have not had a capital gains tax as such apart from short term capital gains as dealt with in section 26AAA of the Income Tax Assessment Act. Some of this property could have been held for years or generations. I am referring to land, buildings and good will-all these sorts of things. If such property has been liquidated in an ordinary liquidation, under section 47 of the Income Tax Assessment Act, the following will apply: Distributions to shareholders of a company by a liquidator in the course of winding-up the company, to the extent to which they represent income derived by the company (whether before or during liquidation) other than income which had been properly applied to replace a loss of paid-up capital, shall, for the purposes of this Act, be deemed to be dividends paid to the shareholders by the company out of profits derived by it. In the current situation it is being deemed, by hypothesis, that in effect a liquidator would make an unreal decision before liquidation and pay a dividend, effectively converting a capital gain to revenue. That is just not on. I do not think a liquidator would have done it at any time within the history of this Federation. There is no point in defining capital gains as income. This is exactly what this legislation does. It deems capital profits to be income. I hope that some sense will prevail because otherwise the damage to the community will be widespread. I hope that the Government will at least consider introducing an amendment. We know the thrust of the Bill. The rhetoric is good-try to ensure that everyone pays their just and equitable share of income tax catch-up with the tax avoiders. But the tax avoidance industry, as everybody knows now, has been dead for about 12 months. What are we doing? We are using some pretty artificial devices, in some cases to catch some very innocent and some very old people. This legislation, I venture to say, will put some of the most respected and the most thrifty members of society into bankruptcy, through no fault of their own. They did not enter into an artificial, blatant, contrived tax avoidance scheme. What did they do? They built up their business through prudent management over the years, some of them over generations, and for one reason or another-because they reached retirement or because a larger company, through an arm's length transaction, purchased that business-they disposed of that business. Such a company is interested in the land, the buildings, the plant, the trademarks and all those sorts of things. The companies that acquire such land and buildings are not interested in taking over the capital structures of the business itself; they just want the plant, the assets, the land and the buildings. These people exchange their shares for shares in a new company or for cash. It is as simple as that. After about a year the business is sold and carried on by the new operators at arm's length and they are left with a shell of a company which probably represents cash, shares or something like that, appropriated profits and the capital. The usual procedure is to appoint a liquidator. The liquidator, in liquidating that company, pays out the paid-up capital-a return on capital which is not assessable. It will not be assessable under this legislation. Also in the company's balance sheet are some capital reserves. What sort of capital reserves are we looking at? There would be profits on the sale of land and buildings. If that business has been held for generations the land and buildings might be listed in the books for a nominal figure and, particularly in a city, those profits could be quite substantial. Millions of dollars of capital profits could be at risk. This land and these buildings will suddenly be caught. In a normal liquidation under section 47 of the Act they would be disposed of tax free. This is the anomaly. The people have a choice of putting the company into the hands of a liquidator or selling it off. Another operator could pick up that shell and form a new company. It is as simple as that. The choice is there. Let us consider those people who chose to sell off the company, who provided their tax returns based on the current year's profits, did the right thing and then suddenly went into liquidation; then somewhere along the line, unbeknown to them, the wrong thing was done. It is a bit like me selling my house and the new purchaser, unbeknown to me, in a year or two converting it to a brothel. Why should I have a stigma attached to me by the actions of a person down the line? Surely that is inequitable. Yet this legislation would allow such a transaction to be traced back and I would become personally responsibile for somebody else's action down the line. Why should not the Commissioner of Taxation attack the liquidators-those people who perpetrated these heinous crimes and created the artificiality? What are we doing by this legislation? We are penalising the innocent people, people who, I venture to say, have done absolutely nothing wrong at all. One might say that they have the cash and are in a position to pay. What pathetic argument. I might have received cash from the sale of my house, but surely I would not be liable for the transgressions and sins of those people who bought that house and used it for ill-famed purposes. I think that analogy is pretty appropriate. Let me return to the actions of the liquidator. If he had liquidated the company, the profits on the land and buildings, when distributed, would have been exempt from tax. This legislation seeks to impose a tax on those profits. What else is there? Goodwill could be included. At present it is non-taxable. I take as an example a fellow who goes into business. Because of his enterprise, the character of the business, its position and what he has put into it the business could be worth much more than he paid for it. Under this legislation that person would be taxed on those gains. For the first time there is to be a new tax on capital. Goodwill, which is a bona fide asset revaluation reserve, will be taxable for the first time. How dreadful. A wide range of items is involved. Reserves on the issue of convertible notes, if disributed by a liquidator, also were tax free. For generations this has been covered by section 47. Dividends which prior to 1947 had been subject to Division 7, section 109 taxes, if distributed by a liquidator, again were exempt, tax free. We are bringing those dividends within the net of this legislation. I venture to say that if we had any conscience we would be prepared- Senator Childs —Cheats should not prosper. Senator WATSON —This has nothing to do with cheats. The honourable senator is losing the main thrust of what I am trying to say. I am talking about the reputable people. Let us concentrate on them. The Government is trying to bring the blackguards, the tax avoiders and all those other people on a parity with the people who tried to do the right thing. Let us try to have some moral courage to separate those who have done the right thing from those who are parasites on society. I will say more about those other people later. But let us have some moral courage. If we do not have the gumption to defeat this Bill, if we are not prepared to put through the right sorts of amendments to give this legislation a little respectability, the only thing we can do, because time is running out, is to put the matter before a committee so that we can receive some informed advice which will give us some moral fortitude to separate the wheat from the chaff. I think it is rather unfortunate and a reflection on this Parliament that we are prepared to pass in this present form legislation that I believe is almost unparalleled anywhere in the world. The legislation will tax profits of a capital nature-not of a revenue nature-that have been accumulated over generations, profits which, had they been put into the hands of a liquidator, would not have attracted tax. Therefore, I believe, as a minimum, that an amendment to this legislation must be accepted but I appeal to honourable senators in the first instance to defeat the legislation outright. I hope that Senator Haines will be able to muster the numbers to be able to defeat this legislation. The Government should introduce later appropriate legislation which is fair and which has been considered over time. But it should not force through legislation in the dying hours of the Parliament which we will regret. It is unfortunate. An amendment should be made to provide that the capital profits reserves of certain classes of companies be exempt from the operation of amendments to the Taxation (Unpaid Company Tax) Assessment Act 1982. Those companies should include those which, at the date on or before which the shares were sold, had accumulated bona fide capital profits-naturally, this would be left to the discretion of the Commissioner, because we know, in practice, what are bona fide capital profits, as he does-and made provision for all company primary taxes on their taxable profits to the date of sale and paid over the amount of the liability to the purchaser of those shares. We must insist upon that amendment as an absolute minimum, if this legislation is to be passed. Apart from that, there is a host of other items which are completely foreign to us. Let us not depart from this place until we have defeated the legislation, or at least passed that amendment. It will be a shame on this Parliament, and on us as senators, to overlook such a travesty of justice to ordinary individuals. Many people may ask: What is the difference between the legislation that we are debating tonight and the legislation that was passed last year, which is commonly referred to as recoupment legislation? That is a fair question. The recoupment legislation that was passed by the Liberal-National Party Government last year sought to tax those current year profits that had not been taxed; in other words, there was a tax liability in respect of profits for those years in which, because of some dodgers using artificial means, it was not met, because the company had effectively been put to the bottom of the harbour-what is commonly referred to as a bottom-of-the- harbour scheme. So a tax liability was created which had not been met. By an artificial, contrived mechanism, company tax was not paid. The legislation went further. It stated that the undistributed profits that would apply to that particular profit should also bear tax at the appropriate rate. The present legislation seeks to take the next step down the line and to attack the profits that have been accumulated over a long period and also the capital reserves or capital profits. Those profits which have been accumulated over time are to be taxed rather than those that apply to a particular period. This is unfortunate because it is very discriminatory. This situation is known as a Slutzkin type case. The High Court, in the Slutzkin case, held that where a person traded in a company that did not have current year profits-in other words , a company which had accumulated profits-those profits were deemed to be of a capital nature. So what does this legislation do? It cuts across an established High Court decision. What is the value of having an independent High Court if taxes are to be imposed retrospectively? There is no point. How will accountants and lawyers advise clients in the future? There will be absolutely no certainty in anything from now on. Advice may be given along a particular line, but legislation may be passed not to operate as from the day of its announcement, as under Liberal Party policy, and not to apply from a particular future date, but to operate retrospectively not only back to 1972 but for a whole host of years prior to that time. As I say, these profits might have been accumulated over a number of years. A decision of the High Court, the highest court of the land, in respect of taxation matters lays down a precedent. But this legislation will retrospectively override that and render it null and void. What sort of government will people think we have when it does those sorts of things? There are two different types of schemes. The Slutzkin scheme involves purely unappropriated profits, with no current year taxes. Under a wet Slutzkin scheme as little as $101 might accrue to one individual taxpayer, and now suddenly all profits are to be subject to tax. Is that not unfair? Such profits might not be derived from trading during the year but from bank interest which has accumulated. In such cases there has been no attempt to deceive or to contrive and there is nothing artificial. On the one hand, once a certain stage is reached the whole amount for capital gains and accumulated profits is to be subject to tax. On the other hand, a dry Slutzkin scheme with no current year profits is completely exempt. One company with $1m may have no current year profits; another company may have $1m in accumulated profits. One is up for a hell of a lot of tax, which will bankrupt all the proprietors, and the other escape tax free. Is that not discriminatory? Have we ever in the past seen before Parliament anything so retrograde or anything which will discriminate to quite that extent? Where is the fairness to people? There is absolutely no fairness in that at all. The Government has a number of choices. It tells us that it has to take some fairly tough measures in order to get the Budget deficit down. What will it do? What is the effect of this legislation on those who have acted honourably as distinct from those that have perhaps used what is known as a round robin scheme ? I do not have much time for the round robin scheme. We must separate the two types of case. The Government, has failed to separate the two types of case- those who are honourable and just, and those who are scoundrels. That is the wicked part of this legislation. It fails to distinguish between the honest members of the community and the dishonest ones. Is that not a dreadful thing? Is it not a reflection upon this Parliament, let alone on the present Government ? The Government has a choice. It says that it has to finance the deficit. We recognise that to do that it will impose some fairly horrific taxes and fairly horrific penalties for those who get caught. Unfortunately, what will happen to the employees of a lot of these businesses? As we know, some of these people have been using these taxation arrangements-some legitimately and some not. I recognise that and I drew the distinction earlier. What will happen is that the employees will lose their jobs because to find the money to pay this tax will more than bankrupt some people. If we look at the rates of tax we see that they are fairly horrific. I would venture to say that if we were trying to be fair and reasonable we would not be imposing taxes, through the provisions in this Bill, ranging from a minimum of 60c of the deemed dividend or hypothetical dividend. One cannot call it a dividend because it is hypothetical; it is assumed. People will be taxed at rates of up to 69.62 per cent-nearly 70c in the dollar. We are told that the legislation of last year in relation to the recoupment tax almost put people on the verge of going out of business. Some may not have gone out of business but this legislation will decimate them. What about all those people-people in the old companies that have been operating for generations? These people are probably in their twilight years. They might have had a trip around the world. They will suddenly find that they will be paying tax at the rate of nearly 70c in the dollar. How much will they have left? I pity them. Senator Jones —You are looking after the tax avoiders. Senator WATSON —I am not looking after the tax avoiders. The honourable senator knows very well that I am trying to separate the two classes. That is the weakness in this legislation. The Government has not had the moral fortitude to separate the wheat from the chaff, the honest people from those who have been dishonest and put artificial schemes into play. If this Parliament had any moral fortitude would it not bring back the rate to the undistributed rate of 50c in the dollar? That is what we would do. We would deem it to be undistributed. We would apply that rate which applies in relation to private companies-50c in the dollar. Alternatively, would not the Government use the middle rate of income tax of 46c in the dollar? No, the Government chooses these penalty rates-the maximum rates that apply in the circumstances-assuming that all the people who pay this tax are top poppies. Everybody in this place assumes that people who own a share in a company must be virtually millionaires and that they must pay tax at the maximum rate. That is just not on. I think this is reflected in the fact that the other day the Government passed legislation which effectively wiped out exemptions to individuals for dividends for which the Liberal Government provided and which would have encouraged small investors to invest sums under $1,000. The present Government assumes that everybody is a tall poppy -a millionaire-who pays tax at the marginal rate. If the Government had any moral fortitude and wanted to attract this sort of tax it would apply tax at the reasonable rate. If the Government wanted to apply tax at a reasonable rate it would go back to using the undistributed profits rate of tax. Senator Robert Ray —Are you going to vote for it then? Senator WATSON —My conscience would not let me vote for this legislation in its present form. Senator Robert Ray —No, if we bring it back. Then are you going to vote for it? Senator WATSON —Bringing it back is the only ray of hope we have heard tonight. Let us hope that the honourable senator can get around his colleagues and bring about some sort of method to defer this legislation. The best thing we can do is to pack up the books now and have another look at this legislation. If the Government is prepared to put this legislation before a committee, I am prepared to vote for that. I think we either have to defeat it or look at it in a more reasonable light. That is the challenge. I leave the decision to the Labor Party . I say to Senator Ray from the Labor Party that I am encouraged by the fact that he put forward that idea. That is the only ray of hope I have heard in all this dreadful debate. We will tend to regret this legislation. I am talking about not only the members of the Labor Party who have been responsible for this legislation but also we as politicians. It may be argued that we did not fight hard enough to stop the legislation, despite what we are trying to do tonight. The Government has a choice. It can try to collect the maximum amount of tax possible by squeezing every bit it can, no matter whether people are rich or poor, no matter whether they are tax avoiders or honest operators. But by squeezing taxpayers, what will it do to the economy? We all know that at present the economy is pretty vulnerable. There are a lot of people whose businesses are tottering on the edge. The Government will put the employees-again, the innocent fellows-out on the street. What opportunities will they have? The Government is attacking capital accretions. It is an unfortunate tax. My time has nearly run out and I am not half way through dealing with this blessed matter. We are in trouble. We will regret this move. I appeal to the honourable senators on the Government side. I hope what will happen has pricked their consciences and that the Government will bring in an amendment. That is the minimum it can do because it will live to regret this legislation. It is a most retrospective, heinous tax. It is a new tax. It is an unfortunate one and it will have tremendous repercussions across the community that I think we will live to regret. Senator TATE(Tasmania)(9.17) —Madam Acting Deputy President- Senator Walters —I take a point of order. I would like to move for an extension of time for Senator Watson. I wonder whether that is possible. The ACTING DEPUTY PRESIDENT(Senator Haines) —Senator Tate has received the call . Senator TATE —I am not surprised that Senator Walters has tried to stop my speaking in my defence of this important legislation-the Taxation (Unpaid Company Tax) Assessment Amendment Bill and the Taxation (Unpaid Income Tax- Dividends) Bill-which is a part of the fulfilment of the Government's election mandate. There is no doubt that we were elected on the basis that we would take the most robust and concerted action to remove from our midst the deleterious impact on our federal revenues of the stripping of companies which took place in a blatant and contrived way, and continually to the great shame of the previous Liberal-National Party Government. Much of what we are doing tonight-this is what makes so much of what we have heard from the other side hypocrisy and humbug-is an extension of what was introduced into this chamber under great public and political pressure by the now Opposition late last year. We are not afraid-as I have said, we have a mandate-to take the most robust continuing action in relation to the effect of years of contrived and blatant tax avoidance which was, it is not too much to say, connived at, aided and abetted by the previous Government. This occurred until, as I say, public opinion became so overwhelming that it had to make some move in legislative form late last year. One well remembers the continuing arguments put by the Australian Labor Party and the Australian Democrats in this chamber in regard to the failure of the previous Government to provide either the Commissioner of Taxation or the Crown Solicitor with the sinews of war to fight the battle which needed to be fought on behalf of ordinary, decent tax paying Australians. The fact is that the years of neglect, connivance and aiding and abetting by honourable members opposite led to the situation in which the ordinary wage earner, the pay-as-you-earn tax payer, had to pay higher rates of tax than would otherwise have been the case. This was because the tax avoiders in the community were using contrived schemes to avoid paying into the federal revenues that which was justly required or expected of them. Of course, the PAYE taxpayer, the ordinary wage and salary earner, could not engage in the brilliant, contrived schemes dreamed up by the best brains in the legal and accounting world. Those PAYE taxpayers could not avoid paying higher rates of tax to fill the coffers in order to fulfil the programs of the elected government of the day. Let us not forget that this legislation is about trying to make amends, about trying to set right the situation which prevailed for so many years in which people in Australia were prepared to take the benefits of living in a free, democratic and wealth-producing society but were not prepared to make a contribution to the Federal Treasury which sustained that society in which they lived so well. As to the retrospective elements of this legislation, there is no doubt that they give cause for some misgivings. It would be remiss of anyone considering this legislation not to advert to that fact. The Senate has long experience now, going back over 50 years, of the Senate Regulations and Ordinances Committee, which has always brought to the attention of the chamber those instances of delegated law making at the Commonwealth level involving some element of retrospectivity, and which has generally struck them down. Retrospectivity is not common in our legal and parliamentary tradition. Having said that and having, therefore, been properly cautioned, it is important to realise that it has always been recognised that there is a need to make a distinction in relation to taxation law. I do not take the retrospective aspect of this legislation lightly; I hope I have made that clear. But I find some reassurance in the words of Lord Greene, who was the custodian of the common law tradition in England, the Master of the Rolls, in the 1940s. In a 1941 Court of Appeal decision Lord Greene spoke for himself and for Lord Justices Clauson and du Parcq in a taxation case. I repeat: This is the Court of Appeal in the United Kingdom, the preserver and exponent of our common law tradition. He said: The fact that the Section has to some extent a retrospective effect again appears to us of no importance when it is realised that the legislation is a move in a long and fiercely-contested battle with individuals who well understand the rigour of the contest. Surely that is the case in this contest going on between the legislature and those involved in various taxation avoidance schemes. The legal tradition to which we are heir realised and recognised in that statement that retrospective taxation law may be permitted, though I agree that it has to be kept to as narrow a compass as can be justified. Again I am heartened by the fact that on 17 August last year the Australian Financial Review, not the most radical journal known to Australian social and political life, in relation to the legislation which was brought into the chamber by the now Opposition and which this legislation seeks to extend, had this to say: . . . non-retrospectivity of the tax law is by no stretch of the imagination an absolute moralor political value. . . . Clearly, retrospectivity is more a serious issue with respect to criminal law than with respect to income tax law. That is exactly the tradition to which we are heirs and which I hope this chamber would always recognise. That distinction has to be maintained, and indeed there are no retrospective criminal penalties involved in the legislation before the chamber tonight. The writer of the Australian Financial Review editorial concluded: In the case of the bottom of the harbour schemes the abuse of the tax system and the injustice is so gross that justice and fairness are on the side of retrospectivity. But the opponents of retrospectivity rightly warn of the dangers of taking it lightly. It should almost never be done. So we do have cause for concern, some cause for caution, and some cause for misgivings, but I believe that retrospective aspect of this legislation can be justified. As I said, this legislation is designed to recover from vendor- shareholders and other former owners of companies stripped in schemes of pre-tax profit stripping the tax that those companies did not pay. The Bill extends the scope of that 1982 legislation so as to recover from the former owners of companies stripped of pre-tax profits also the personal income tax which they avoided through those schemes. I do not intend to dwell on the technicalities in this particular legislation. I believe that others are more able, in the Committee stage of the debate, to engage in a more particular dissection of the clauses, which is properly a function of this chamber. I should make it clear that, as I understand it, the Government, since introducing the Bill into the House of Representatives, has made two important concessions, largely in negotiations with Senator Jack Evans of the Australian Democrats, which should allay many of the concerns and some of the misgivings which people have. In relation to the time within which people will have to pay the tax liability which is imposed on them by this legislation, it had been proposed to abolish the facility for penalty free instalment arrangements, for payment of unpaid company tax which is normally provided. Undoubtedly that would have created hardship. I think it is a good thing that the Government has recognised that there ought to be provision for the payment by instalments of the taxation liability which is assessed under this legislation. Thus, as I understand it now , former owners who do not seek to exercise rights of objection against the target company's assessment as a result of which company tax is payable, can now enter into an arrangement with the Commissioner of Taxation to pay, free of additional tax for late payment, all the company tax payable and to do so by instalments over a period of 12 months or such longer period as the Commissioner allows. I take it that that is a very sensible and wise provision which recognises that people will not have immediately to hand the sort of money which they may be required to make available under this legislation. Of course, it may be that there are further cases where genuine hardship, devasting effects and consequences and impacts of a kind which would destroy a person's financial well-being and that of his or her family may occur if this legislation is pushed to the extreme limit in particular instances. In relation to that aspect, the Government has said that section 265 of the Income Tax Assessment Act will apply. As honourable senators know, this section of the Act can operate to release a person from liability where it is demonstrated to an absolutely independent arbiter that hardship will occur if the tax liability is pressed to its absolute conclusion. The recognition of that point is extremely important. The fact is that that discretion is exercised by the taxation relief board and whilst it is true that it is an absolute discretion and that, therefore, one cannot say with absolute confidence in relation to any particular case what the outcome might be on an appeal to it, the fact that it is an absolute discretion enables that board to take into account all the relevant circumstances and, without any binding by some previous decision or way of viewing the matter, it can come to a conclusion which is favourable to the taxpayer. Senator Messner —You obviously have never had any dealings with the Commissioner . Senator TATE —I think Senator Messner is saying that he has never seen it actually occur in his professional practice. I understand it to be the case that the board of taxation relief does not actually publicise its decisions. If that is the case, it is not surprising that Senator Messner is unable to point to a series of precedents in this field. As I say, the Government has made it very clear-I am relieved, to be quite frank, that it is the case-that in cases of hardship demonstrated to this independent, impartial taxation relief board, the board will exercise a discretion in favour of the taxpayer and not cause that absolute hardship. I have had many telegrams and representations from people who make the claim and the plea that, if the legislation as presently drafted goes through, they will face bankruptcy and penury. But I say that in that situation there is every reason to believe that an approach to the taxation relief board will find a response. I have made the point that most of the pleas have been directed to us in relation to the Bill as it is presently drafted. The fact is that there are still some matters within the Bill which give some legitimate cause for concern. I refer in particular to the inclusion of capital profits with revenue profits in regard to the amount of undistributed company profits covered under the Bill. Perhaps the Government should give that section further careful consideration. Senator Dame Margaret Guilfoyle —Did you read Mr Dawkins's Press statement of tonight? Senator TATE —I have not had an opportunity to do so. I believe that there is legitimate cause for concern in relation to that portion of the Bill which deals with undistributed profits. Having said that, I repeat that the Bill is but part of, and an extension of, the legislation in respect of retrospective taxation which received the support of this chamber late last year. No bluster, no hypocrisy from the other side, can deny that fact. Insofar as the passage of this legislation will enable the Government to gather several hundreds of millions of dollars of revenue that it had a legitimate right to expect to gather, had the previous Government taken more vigorous and robust action in relation to tax avoidance schemes. It will be able to provide the sort of tax relief that is needed by the ordinary Australian taxpayer, the honest taxpayer, the pay-as-you-earn taxpayer, who cannot avoid tax by engaging the best legal and accounting brains in the country and perverting them to his or her own selfish ends. It will relieve the ordinary PAYE taxpayer of the need to carry the burden of paying more of his or her income to the Federal Treasury in order to provide the kind of society that we wish to build. Surely that society ought to be built on the basis of everyone making a fair contribution to the Federal revenue. I also say, and admit, that it ought to be a society in which retrospective legislation is extremely uncommon. I hope that this taxation measure provides one of the last instances of it, but it may be that further instances will be necessary as we clean up the effects of the neglect by the previous Administration in this field. It was an administration, I repeat, which failed to provide the sinews of war, which continued to neglect to give the Commissioner of Taxation the sort of legislative and administrative support that he required. Let us not forget that he made plea after plea that officers be appointed to his Office to strengthen his investigation section in order to carry through investigations as a prelude to recovery. We all know the saga of the administration of the Crown Solicitor's Division where, once again, inadequately trained staff were assigned to taxtion prosecutions in such a way as to lead the tax avoidance industry to believe that it could carry on regardless of the law. It will be found that this measure, when properly understood by the Australian general public, will be seen as part of the Government's fulfilment of the mandate given to it on 5 March to create a better society. I refer to a society being marked by the distortion of tax which, rather than one in which, as Professor Mathews said in a famous address to the Australian National University , taxation payments by the rich were becoming discretionary-will fulfil our mandate to create a situation in which all Australians who are able to do so will pay a level of taxation which is fair and just and which is limited to the sum required to provide the range of government services and assistance which makes us a civilised, fair and decent society. Senator MESSNER(South Australia)(9.35) —I rise to oppose this package of Bills which the Government would have us believe just merely strengthens and extends the Bills that the Fraser Government enacted last year to deal with bottom-of- the-harbour tax evaders. Senator Grimes —I hope you declare your interest. Declare your interest. Senator MESSNER —I have been asked to declare my interest. My interest is nil. Let us take the point that there is a question-- Senator Grimes —What is your occupation? Declare your interest. Senator MESSNER —Madam Acting Deputy President, I ask you please to refer Senator Grimes, the Minister for Social Security, to my earlier answer. It is quite clear that I have no interest in this matter whatsoever. There is a difference between this legislation and the law enacted by this Parliament in September-October last year to deal with bottom-of-the-harbour schemes. Clearly this legislation introduces a new tax. It imposes a new liability of taxation upon items of a company's income. Those items are to be interpreted, under this law, in a punitive, vindictive, vengeful and, indeed, confiscatory manner. That is the point of this legislation. It is certainly nothing else but. I put it to the Senate that that is an entirely consistent attitude for a person on this side of the Senate to take in the light of his support for the legislation that was passed six months ago. The point is absolutely clear because, whereas the tax that we spoke of in the legislation passed last year was a recoupment tax, this is a new tax. It is based on a new set of principles in relation to undistributed profits and capital gains. I will return to that very soon. But I make the point that in the cases about which we are speaking there has never been, as there was in the terms of the legislation brought down last year, illegal evasion. We are talking about consequences arising from avoidance arrangements. Last year the Government set out to recoup to the Department of the Treasury tax that was due or payable but had been evaded by an illegal act. There was no creation of any new liability. The then Government redeemed an existing tax liability from those who had benefited financially from illegal evasion. I think we need only one very clear example to make that matter absolutely clear even in the minds of Government senators. The former Government established an inquiry under Mr John von Doussa Q.C. to examine the affairs of Mr Horgan. He brought down, as a result of that inquiry, an absolutely clean bill of health for Mr Horgan. Senator Grimes —You must be joking. Come on, declare your interest. What did you do before you came here? Senator MESSNER —That is the kind of attitude that exists on the Government side of the chamber. Government senators are not prepared to take account of facts given as a result of an inquiry undertaken by a person learned in law. He knew what he was doing. He examined very closely the affairs of Mr Horgan and proved that he had a clean bill of health. Mr Horgan is the kind of person who will now be subjected to a confiscatory tax under this legislation. Somebody who has been cleared by an official inquiry will be the subject of this kind of legislation. That is what this law is about. It is absolutely beyond comprehension that even this Government would contemplate bringing this kind of law into being. Let us consider the situation of Senator Tate who just left the chamber. He is a professor of law. He is most experienced in these matters, apparently. Senator Grimes —Tell us what you are. Don't tell us what he is. The ACTING DEPUTY PRESIDENT(Senator Haines) —Order! Senator Grimes, the Chair has been remarkably patient with your curiosity about the previous occupations of certain members of this chamber. That patience will not last much longer. Senator MESSNER —Senator Tate is also Chairman of the Senate Standing Committee for the Scrutiny of Bills. Senator Grimes —Madam Acting Deputy President, I take a point of order. If it is reasonable for Senator Messner to point out clearly the previous occupation of the previous speaker, surely it is reasonable for me to ask the previous occupation of Senator Messner. If he is coy about his occupation let him be coy about it, but let him not cast aspersions on the occupation of the previous speaker. The ACTING DEPUTY PRESIDENT —There is no point of order. Senator MESSNER —By no means was I casting aspersions upon Senator Tate. In fact I was praising him for the very high position that he had gained and for the recognition he had gained from his colleagues in the law. That is the point I make. He is Chairman of the Scrutiny of Bills Committee. What did the Scrutiny of Bills Committee report in respect of this legislation? I remind the Senate that it is an all party committee; it is representative of all parties in this place. Senator Tate is its Chairman. In respect of clause 17 the Committee, in its report, referred to: . . . all the retrospective provisions (of C. 17) which might be regarded as trespassing on personal rights and liberties . . . That is a clear indication-- Senator Grimes —Read on. Senator MESSNER —I will and I will come to that in a moment. Let us look at clause 21. The report states: . . . that the Committee notes that the onus is on the person served with a notice of liability to institute a formal challenge or review, and it therefore draws the initial reversal of the evidentary burden to the attention of senators in that it might be regarded as trespassing unduly on personal rights and liberties. Senator Grimes —Keep reading. Senator MESSNER —That is the end of the quote. I repeat: This is a committee of this Senate talking about this legislation which was brought down by this Government. This Opposition opposes it and agrees with the Scrutiny of Bills Committee. Let us turn to one or two other matters which were raised by Senator Tate in his brief address. He struggled manfully to try to defend the Government on this most heinous piece of legislation, I regret to say without success. However he did refer to the hardship provisions in section 265 of the income tax law. Notwithstanding that Senator Tate is a remarkable lawyer and has a fine understanding of the matter, he probably has had very little experience in dealing with the dealing with the Commissioner of Taxation in this area. Surely one of the areas of hardship that is of great concern is bankruptcy. I challenge the Minister to take to the Commissioner of Taxation a case which would result in bankruptcy as a result of the Commissioner's actions and see whether he can have it treated as a case of hardship. Bankruptcy is no defence of hardship in trying to prove one's eligibility for special release under section 265. I would like him to try it and see how far he gets. For Senator Tate to say to us that there is some let out for people who are caught in a situation such as that, by applying under section 265, is sheer rubbish. We shall turn to other matters in this legislation. There are some clear examples of situations which have arisen by virtue of this legislation and which cut clearly across the general principles of the taxation law. There is, of course, the point that there are accumulated profits in a company. By virtue of this legislation, irrespective of the length of time that those profits have accumulated-I put to Government senators who are smiling and who seem to think that this is a great joke-full taxation has been paid on them. Senator Grimes —Nonsense. You know that. Senator MESSNER —I regret to say that Senator Grimes does not know what he is talking about. If he listens for a moment he may learn something. I repeat for Senator Grimes's education that these are profits upon which full taxation has been paid. In addition to that, companies do from time to time accumulate capital profits which result either from realised gains or perhaps from the revaluation of assets. Of course, other opportunities exist within the commercial arena. But those two groups of profits by virtue of this legislation are now brought together and treated as one in such a way as they are deemed to be fully taxable in the hands of the owner-vendors. Senator Grimes —So, if we pull out capital tax it's okay, is it? Is that what you are saying? Senator MESSNER —If Senator Grimes would only listen perhaps he might understand the point I am trying to make. We are not talking about one class of profits or another; what we are talking about is the accumulated capital, be it from after tax paid profits, capital gains or otherwise, which have accumulated in a company and which, of course, represents that company's total capital. Let us just for one moment consider what the capital of a company is. Some people would have us believe-I am sure that many honourable senators opposite would believe-that it is a big lump of cash sitting somewhere in a bank account or in some readily realisable asset. But what is it? That capital is represented by the total assets of a business less its liabilities. Those assets could be anything coming from the firm's plant and equipment or from the real estate that it owns upon which it operates its business. It could represent the debts owed to it by the people to whom it has sold goods on credit. It could represent money that is held in bank accounts and does, of course take into account, as offsets to that, money owed to various creditors, to bankers and to long term debenture holders. So we have a situation in which that business exists only because that capital, made up of accumulated after tax paid profits of the company and capital gains are invested in the operation of that business. The people who earn their salaries and wages each week by working for that company are the employees of that company. They depend for their very jobs on the maintenance of the capital of that company. What is this Government proposing? It is proposing, firstly, to apply a tax to both the accumulated after tax profits and the capital profits of the company in such a way as to strip that capital entirely and to leave it in a destitute, if not bankrupt, situation. What would be the consequence of that for all of the employees of that company? Clearly there would be only one consequence. Clearly the business would have to reduce its activities. Clearly, the people employed by it would have to be disemployed and sent on to the scrap heap. The Government came to power on 5 March promising the people 500,000 jobs in the next three years. The first thing it has done has been to set about destroying the jobs of Australians by virtue of this kind of activity. This is not the first occasion on which the Government has sought to do that. It has sought to do it in many other ways, particularly in my State. Senator Elstob had better note the wrath of the voters of South Australia in respect of what this Government has done in the uranium mining area and also, of course, in respect of the construction of the railway between Alice Springs and Darwin. Those points would lead one to believe that this Government has its sails set clearly for the destruction of the Australian economy. Why else would it put up this legislation? Is it just an Aunt Sally for the Opposition to knock down? Does the Government think we are so stupid-- Senator Elstob —It is to stop tax dodgers once and for all. You have never stopped or attempted to stop tax dodgers. Senator MESSNER —Oh, do not come on with that rubbish. Let us just have a look at what some of the media are saying. Let us consider what was said in the editorial in the Melbourne Age last Friday: Retrospective legislation is acceptable when used to recover tax that has been fraudulently evaded. I intervene to make the point that that is precisely what the Fraser Government' s legislation was aimed at doing last October when the Senate passed the legislation. The Age went on to say: It can also be justified after a general warning has been given that tax might be collected retrospectively in the case of blatant artificial, but apparently lawful, avoidance schemes. I intervene again to make the point that in 1978 the Parliament passed legislation which may have been regarded as retrospective in respect of the Curran scheme. I remind Senator Grimes that that traced itself back directly to activities and announcements made by the then Treasurer of the Labor Government in 1974, Mr Frank Crean. So it fits that circumstance. The Age continues: The new legislation drives the thin edge of the retrospectivity wedge beyond its legitimate target. It is too broad: It would hit some people unfairly. It should, therefore, be modified. The article went on to support the Coalition's attitude and made the following point: The coalition parties are opposed to this extension on the ground that it imposes additional tax which would not have been payable at the time. Their objections have validity. I rest my case. This is clearly the situation that we are in at present. That is why we are opposing this legislation so determinately and so clearly. Let us consider some of the problems that will arise out of this legislation. I refer to accumulated profits upon which tax has been paid. This tax will apply to that group of profits in addition to the current year's profits which were the subject of the previous legislation introduced by the Fraser Government. This means a tax upon the retention allowance which a private company can retain without incurring any tax liability. The retention allowance crystallises undistributed profits. The concept of a retention allowance is to provide liquidity for business-small business, large business, funds for development and funds in order to create jobs for Australians. The accumulated profits or retained earnings would be taxed only if they were distributed to shareholders or the company was liquidated. In other words, by embarking on schemes, as taxpayers they did not evade tax on their profits; the tax would not have been payable. But because their activities would have been perfectly legal there was no evasion. The tax on capital profits is a similar situation. There is no evasion, there is an accumulation of capital profits in a company. Had there been no change to the company situation, the profits would never have been distributed. But this Government seeks to tax those profits as though they have been and to apply a punitive tax against not only the owners of the business in the final analysis, the shareholders of the company, the directors or the more highly paid people but also against the employees of that company and put them on the scrap-heap. This is what the legislation is about and why we on this side so vehemently oppose it. Let us just consider a company that may have started some 50 years ago. It may have accumulated profits from its retention allowance, legally allowed under the income tax legislation, only after profits have borne their full share of primary company taxation and upon which dividends have been declared in accordance with the law and which, it turn, have borne tax in the hands of the shareholders-a perfectly legitimate and ordinary situation. Let us look at that company, say, 50 years later after its shares have been sold to an incoming businessman who purchased them in order, perhaps, to rearrange the management of the business, improve its performance, improve its profitability and employ more Australians. One could imagine that, after that period, very substantial reserves would have been built up in the company. Let us say that the new person coming in, having purchased those shares, builds up the business over the next five years, changes its mode of operation, creates more jobs, thereby getting the company into a stronger position and resells those shares to somebody who makes an appropriate offer. Suppose that is done-as is the normal case-with a full knowledge and understanding of an arms length transaction of this kind and in a normal, business way and the shares in that company finally end up in the bottom-of-the-harbour schemes. That shareholder, entrepreneur or new businessman who held the shares for five years of the total period of existence of the company of some 55 years would be required and liable , under this legislation, to pay the tax assessed by the Government's punitive legislation on the whole of the accumulated profits that have been put together over a period of 55 years, not just the five years that he owned the shares. If anything would lead shareholders to bankruptcy it is that kind of confiscatory tax. How can that be justified by Senator Tate, a professor of law from the University of Tasmania? How can it be defended by Senator Walsh? I just wind up by making this legislation as clear to the community as it is to the Opposition. I believe that most honourable senators would know that Mr Michael Sharpe, President of the Institute of Chartered Accountants, a body of which I am a member-I declare that interest-noted the equity of the proposal in a telex to the Prime Minister (Mr Hawke) as follows: This Bill proposes that vendor shareholders pay tax on already taxed accumulated profits which the company had no obligation to distribute and which, in ordinary circumstances, would have been retained. One result of this Bill will be the forced and unnecessary winding-up of long-established family businesses which rely on retained earnings to finance their ongoing business operations. Such a penalty is unfair. That comes from one of the leading professional organisations in this country whch cannot be criticised in any way for having a role in supporting tax evasion and avoidance methods. I hope that all honourable senators will recognise that in 1979 the Institute of Chartered Accountants was one of the first as a public body interested in issues of this kind to take a public stand against artificial and contrived tax avoidance schemes. In fact it issued directives to its members , including me, not to involve themselves in that kind of transaction. These Bills constitute a savage attack on the Australian private sector. They are vindictive, vengeful and, of course, confiscatory. They owe their origin to this Government's obsessive belief that all people engaging in private commerce are dishonest. This obsession has, in this instance, clearly blinded the Government. Clearly, it has blinded the eyes of the Minister for Finance, Mr Dawkins, as no doubt honourable senators on the other side of the chamber are aware. But in case they are not I draw to their attention a Press release which I think was issued late this evening which reads as follows: The Government remains committed to its legislation to recoup the many millions of dollars in tax which are owed from blatant tax avoidance schemes. We believe strongly that the legislation should be passed by the Senate unamended. At the request of Senators Mason, Evans and Harradine, I authorised access for them to the Taxation Office. The Taxation Office, as a result of their request, has advised them about the terms of possible amendments to the bill. Mr Dawkins then goes on to say: My assistance was made as a matter of courtesy-- And, get this- and with no intention of supporting or encouraging any amendment of this legislation. Senator Dame Margaret Guilfoyle —Senator Tate didn't know that. Senator MESSNER —Of course, Senator Tate did not know that and he was up here preaching to us a little earlier about the good intentions of this Government. This Government has taken into its confidence, apparently with a thoroughly, I would say, honourable attitude, as it evidenced, to speak to honourable senators on this side of the House and allow them access to the staff of the Australian Taxation Office. It has advised them about possible amendments, and then it has the gall to say: 'It does not matter what you think. We will not amend the law anyway. We want it'. That is what this Government is all about. It is a jack- boot government and it wants to ride over the rights of Australians. Senator MACKLIN(Queensland)(10.1) —I think I am the first speaker in this debate who voted against the legislation last year. On a brief count I did a little while ago, I think there are now only nine honourable senators who will be in that position when the vote on the second reading of the Taxation (Unpaid Company Tax) Assessment Amendment Bill is taken. The situation that I wish to put is in two parts. The first part deals with the principle of retrospectivity, the second part deals with this Bill in particular. I wish to reiterate some of the points that I raised last year and if Senator Button wishes to interject, I will be able to give my references to the points he raises. The points that I raised in terms of the retrospective principle last year apply equally in this particular piece of legislation. In the Age this morning the stance that I am taking was called a reliance on a simplistic principle. I do not happen to believe that it is a simplistic principle. It is a principle which is enshrined in the United Nations International Covenant on Human Rights. It is a principle which is contained in the United States Bill on human rights. While other honourable senators may not agree with the principle, I do not believe, in any shape or form, that it is a simplistic one. I believe it is an important one. It is one which I would have hoped might be enshrined in any Bill of rights that this country enacts. What is at stake is a situation that, to me, is extremely important; that is, that when a person engages in any activity, I believe that he has a human right to know whether that activity is legal or otherwise. That cannot result if retropective legislation is carried out. It is not possible to know, as one enters into an activity of whatever kind, whether at some later stage that activity may be declared illegal. That is the crux of the problem that I have with this legislation and with the legislation introduced by the Liberal and National parties last year. Senator Jessop —Hear, hear! So did I. Senator MACKLIN —Yes, I acknowledge that. I wish to make the point that last year's legislation dealt with a number of activities which undoubtedly were fraudulent. I do not think that anyone in this chamber stood up in the debate last year-I have re-read it briefly-and actually claimed that that was not the case. I think everybody in this chamber and in this country is very much aware that there have been rip-offs in the taxation system. But if that is the case, the Commissioner of Taxation still retains the power to go back to 1972 and take those people into court. The point I made last year was that it is not a matter of democratic right to stand up in this place or any other place in this country and say: 'You are guilty'. It is a requirement of any just legal system that a person not only be able to say that someone is guilty but also be willing to take that person to the court and prove that he is guilty before his peers or a judge. I believe that is basic to any democratic operation. Those fundamental principles were violated last year in that the Government could have instructed the Commissioner of Taxation to inquire into and take to court many of the people involved in the activities that were taking place. On the best legal advice that we have available to us, it was clear that those cases would have succeeded. Those people would have been caught by legal action and would have been made to pay. That action would have been supported by every person in this country. But to go beyond that and to violate that basic principle is to engage in an activity which ought not to happen in a democratic community-certainly not in one dedicated to notions of human rights and a legal system such as are current in this country. It is always possible to say: 'We could recoup this tax or that tax it we engage particular laws. We could gain this amount of revenue or that amount of revenue if we change laws retrospectively.' There is a very simple retrospective law which would recoup far more than the Government has attempted to under this legislation. We could rule illegal all deductions on income tax back to 1972. Why not? The reason is that that would also violate the principle. That brings me to another point. Is what will happen with the passage of this legislation a right which was given under the law? The Government cannot have it both ways. If it is a right given under law then the people are immune. If it is not a right under the law, they are liable to prosecution. There are no other positions. It is one or the other. If we are not willing to go into court and launch prosecutions against individuals on the basis that we believe that what they did was fraudulent, then we stand condemned, not those people. What enabled us to get to this position, and what enables the present Government to bring in this legislation, was the legislation which was introduced into this place last year by the Liberal-National Party Government. It was that Government-I exclude honourable senators from the Liberal and National parties who voted against the legislation; I am sure they will register their points of view, which has been registered in Hansard-that started this off . It broke that principle which enabled this Government to go much further than it would have dared to go if that legislation had not been passed in November last year. That has to be accepted. Now the Government is quite happy, for the sake of revenue, to violate basic legal, constitutional and human rights in this country. I was vastly disappointed by the contribution from Senator Tate. As a supporting argument for actually engaging in this particular operation, he said that if we did not do so we would have to raise taxes. It seems to me to be the very basest of arguments to say that we are happy to hit people, whether or not they are entitled to be hit, on the basis that we do not want to put a fair tax on everybody. I acknowledge that this particular view has been prevalent in the electorate. The stand I am taking is not the popular stand by any means. It is a complicated issue and people are not willing to go down the track and find out about it. The Government will not suffer any electoral backlash by pushing this legislation. It is a popular issue on the side of the Government. I acknowledge that. But that does not make it right. I have heard Senator Tate argue that point in here time and again. I was extremely disappointed that he stood up here tonight to use that argument as his reason for supporting the legislation. If he believes the legislation is correct it stands on its own merits. But surely we should not do this because otherwise we would have to put a tax on everybody. That does not make this piece of legislation right. That surely is the basest of arguments to propose. So we have said to people: 'We now have to declare wrong what you did at some stage in the past. We want to rewrite history from the side of the Government'. Would the Government believe it would be legitimate for those people now to ask: 'If that is now to be the consequence, may I have leave to rearrange my affairs to meet your new law'? Would that not also be fair? What would those people do in those circumstances under this law? Of course, they would retract those types of operations. That would seem to me to be a fair and reasonable proposition. If one side of the compact is allowed to rewrite history, surely the other side of the compact ought also to be allowed. That is basically the absurdity of retrospective legislation-that we declare on one side what people did was wrong, and they stay with it. We say: 'We are going to penalise you for an activity you did in the past and you may not rewrite that piece of history'. Basically this legislation imposes a penalty tax on all past profits accumulated over the entire life of a company, upon which a minimum tax of 55c in the dollar has already been paid. That is, it will put a tax on all past trading profits. It may catch up companies. Presumably all senators have received representations on this and have looked at some of the cases. Some companies go back to the last century; we are not just talking about companies that started in 1972. We are talking about legitimate operations since before this Parliament was formed. That is the extent of this piece of legislation, but it goes further. All past reserves accumulated over the entire life of a company which under normal commercial circumstances would never attract taxation-that is , past capital profits-will be caught up. In other words, the Government is now proposing a new tax on items which would never have been taxed even if the operation that the Minister for Finance (Mr Dawkins) spoke about had indeed been carried out. Worse than that, we then find there is a 60 per cent penalty tax on things such as goodwill, credit reserves and book entries between associated and related companies. Let us be very clear that this Bill covers both wet and dry Slutzkin schemes, so-called. The Taxation Office has acknowledged that. This means that we may refer to the judgment of the High Court of Australia in relation to this legislation. In passing, it is interesting to note that Mr Slutzkin is now held out to be a criminal when in fact he was the gentleman who took his own company to the highest court in this land and won a judgment. He is now bandied around in the community as being a criminal. His name is synonymous with the criminal activities of bottom-of-the-harbour companies when in fact he was the person who won a High Court case on the law as it stood. I think that needs to be taken into consideration when we are looking at this matter. That shows how far this legislation is reaching. The Minister for Finance in his second reading speech in the House of Representatives said that, if the operations of the companies were carried out in such a way that the companies continued to operate as going concerns, the dividends in the hands of the shareholders would have been taxable. The Bill deems a dividend to have been paid and accordingly imposes a tax. It seems to me that this is where the fundamental area of commercial logic lies. I refer to the factor I have already mentioned. If the companies had continued to operate as going concerns, it is highly improbable that any greater dividend would have been declared than was necessary under Division 7 or, depending on the type of company involved, possibly was necessary to appease shareholders. In other words , if we construct a hypothetical scenario of commercial operation and then propose to tax in relation to that hypothetical scenario, we ought also, I believe, to look at that scenario to see whether it holds up in commercial practice. Of course, it would not. Another aspect I wish to look at has been overlooked in the debate so far. This piece of legislation will not touch the really big people because our law will not reach them. They did not engage in activities in Australia; they went overseas. They went to the Bahamas or some other place to engage in their activities. Basically, we are looking at small and medium sized businesses. Senator Crichton-Browne —As Mr Dawkins said, 90 per cent of them were small company businesses. Senator MACKLIN —We are looking at small and medium sized businesses. The bulk of that group is extremely important to our economic health. That is not only my opinion. It happens to be that of the Prime Minister (Mr Hawke) also. If we look at the Australian Labor Party's policy speech, we find a commitment by the Labor Party to small businesses. It proposed an increase in respect of after tax trading profits from 80 per cent to 100 per cent for small businesses where retained earnings will be used within the company's business for 'genuine business purposes'. That is precisely the problem that occurs with most of the restructuring companies that are caught up under this tax. They are the ones that are restructured to retain that money. The Prime Minister explained this proposal by his party. I supported him and thought it was one of the best policies that had come out on small business in the election campaign. I gave credit where credit was due. It shows that if what was proposed was done it would give probably the best boost to be imagined to small business in this country. That proposal is the best way of doing it. The Prime Minister acknowledged that fact and said that was why the Labor Party was committed to that action. What it is doing in this legislation with these companies is the very opposite to the election proposal. These companies, at the time they took the action in question, did so using lawful methods. The Government now proposes to penalise them for that action. That point has not been raised so far. But it is an absurdity in terms of what the Labor Party committed itself to do for small business if it was elected. I believe it is important to realise also that we are not talking about merely corporate entities. It is all very well to sit here and to vote one way or another on this issue and not feel a great sense of responsibility. But we are talking about the entire livelihoods of people, their families and their employees. A group of 16 companies that met in Canberra a few days ago tallied up the employment loss if this provision were introduced. That group stated that 19,500 would lose jobs in these 16 small companies. If this example is spread throughout the nation, what are the employment implications? I hope that the Minister for Resources and Energy (Senator Walsh) in his reply at the end of the second reading debate will be able to give us the Government's projections of the employment losses as a result of this legislation. I am sure that the Government has indeed undertaken that activity. But we must consider more than the employment losses. When we destroy companies , we destroy company tax. We destroy income tax from the employees and increase social security payments in not only that company but also downstream companies. The spreading effect also has to be estimated. I believe that while the Government may come out ahead in the first financial year I am quite sure that the books three years hence will show it to be in the red from this operation. We are attacking the productive sector of the community-not huge businesses, not multinationals, but small and medium sized companies, family companies, companies which cannot stand this treatment. Many of them are at the wall because of last year's legislation, and we propose to push them over. When they go into liquidation we will be happy. We will grab that. That is a short term economic prospect which may help this Budget, but will next year's Budget and the Budget in the year after that be helped by this activity? If those involved were doing something wrong I would support the legislation, but we have already had the acknowledgment that what they did at the time was legal. That makes this measure doubly heinous and very difficult for those business people caught in this matter to sit down and swallow. They will have their throats cut on the basis of what they did was legal. Members of the Press talk about rip-offs and everything else. Let them look one of these people in the eye and say: 'You were ripping others off'. Let them say that. Let them go through the books and see that what those people did was legal. The Minister has acknowledged that what they did was legal. Let us look at the situation of some of those people. Let me refer, for example , to a statement from a person who read of such matters in a newspaper. He said: 'I am not in this category'. The person who said this, by the way, had never finished high school. He did what many small businesses do: He bought himself professional help; he took professional opinion. In many cases such people cannot fully evaluate the professional advice that is given to them. The person said: I am not in this category. I acted totally within the existing laws at the time . That has been acknowledged; he did- The company I sold exists today and complies with all legal and statutory requirements. My record is now being tarnished by the implications that I have acted wrongfully because of the provisions of legislation that did not exist when I sold my business. That is what gets at these people-the provisions did not exist at that time. Cases such as this are multiple. I wish to take one example at the other end of the scale. I believe that the Minister has to reply as to the Government's projections of the problems that this legislation will cause. We are looking at an economic package; we are looking at the Government's overall projection when considering this legislation. Those involved in the case I cite say that the group of companies to which they belong will have to cancel and suspend projects currently valued at $78m and sack over 400 employees and 500 to 600 sub- contractors. If the Minister does not accept these figures I hope that he will be able to give us a detailed projection of what the Government understands to be the employment implications of this measure. The Government must have an estimate of this because, presumably, it is looking at it in its overall economic approach. If the detrimental effects from this legislation are such that we lose more jobs than the amount of money we will be able to employ, then we are not only engaging in reprehensible legislation but also in legislation which must be an absolute absurdity. We are proposing to wipe out companies and jobs on the understanding that we want the money to create jobs. I believe the Minister has an obligation to answer at least the latter part of what I have raised. Last year the Minister, to give him his due, made no bones about the fact that he supported retrospective legislation, as did the Australian Labor Party. At least it is consistent on this issue. If the Government is not concerned about those legal and moral rights of individuals in our community, surely it can be concerned about the possible economic ramifications of this piece of legislation . Senator JESSOP(South Australia)(10.26) —I find it quite interesting that the Labor Government at last has taken some interest in recouping taxation that is supposedly avoided by certain companies throughout Australia by way of the bottom-of-the-harbour scheme. Senator Gareth Evans —What do you mean by 'at last'? How long have we been here? Senator JESSOP —The Whitlam Government was in power in 1973 when this particular bottom-of-the-harbour scheme was uncovered. The then Attorney-General, Senator Murphy, took no action about it. I repeat, the other bottom-of-the-harbour scheme was discovered then. As far as this Government is concerned- Senator Gareth Evans —This particular scheme. Senator JESSOP —That may be so, but the point is that the Whitlam Government revealed this form of tax evasion and did nothing about it. Senator Gareth Evans —Ha, ha! Senator JESSOP —Senator Evans might well laugh. The former Leader of the Australian Labor Party laughed on many occasions, but he did nothing about it. It was left to the Fraser Government to follow up this matter and do something about it. I suggest that the Labor Government has been culpable for a number of years in this way. I have been interested in the large number of telegrams and letters dealing with this proposition that I have received over the last few days. I have several telegrams which I would like to read. One, which came from New South Wales, states: The proposed Unpaid Company Tax Amended Bill 1983 is likely to mean that I will lose my job because of its adverse effects on the building industry. Please vote against this Bill. Another one says: The proposed legislation to tax capital and retained profits is un-Australian and unfair. It will cause widespread unemployment and chaos as well as causing the savings of a lot of people to go down the drain. Please don't allow this kind of thing to happen. Another one suggests: Please reconsider Taxation (Unpaid Company Tax) Assessment Amendment Bill 1983- will financially ruin many businesses with subsequent loss of employment for tens of thousands of Australians. Another one also says: Please reconsider Taxation (Unpaid Company Tax) Assessment Bill 1983-will financially ruin many businesses with subsequent loss of employment for tens of thousands of Australians. These concerns have been precipitated by the new-found interest of the Labor Party in recouping tax lost in this way. I agree that we have to do something about recouping tax that has been deliberately evaded. I have stood up and said: 'We have to look after people who are innocently involved in these matters, perhaps due to the advice of lawyers and accountants. People may have unwittingly taken that advice'. I have always said that retrospective taxation is bad. It is a matter that is enshrined in our Liberal Party philosophy. I have always defended that matter. I will continue to do so. Debate interrupted. Northern Territory-Tax Avoidance and Evasion-Burdekin Falls Dam Project-Trans Australia Airlines and Ansett Transport Industries Ltd The DEPUTY PRESIDENT —Order! It being 10.30 p.m., under sessional order I put the question: That the Senate do now adjourn. Senator KILGARIFF(Northern Territory)(10.30) —I refer to a matter that arose in Question Time yesterday when Senator Robertson addressed a question without notice to the Minister for Resources and Energy, Senator Walsh, concerning alleged tax avoidance in the Northern Territory. One can only say, in relation to Senator Walsh's answer, that it appears that under the pressure of Question Time he reverted to his old habits of smear and innuendo. With regard to the specific allegations that were made, Senator Walsh talked about the Northern Territory Chief Minister having a voracious appetite for Commonwealth revenue, thereby seeking to peddle the excuse that the Treasurer (Mr Keating) gave for not completing the rail link from Alice Springs to Darwin. The excuse was that the Northern Territory got too much money. Let us set the record straight once and for all regarding the Commonwealth Grants Commission's recommendations for the Territory. As I have indicated before, the Grants Commission is an independent authority that reviews the requirements of funding of States and Territories. I would say that the Grants Commission is a fair authority. The Northern Territory Government receives $3, 035 per head of population to provide standard government services, compared with $926 per head of population in New South Wales and Victoria. In addition, as a result of small population and large distances-there is a clause within the memorandum of understanding that in remote areas such as the Territory there can be a special grant-the Grants Commission recommended a special assistance grant of $98 per head. Having in mind the necessity for developing the north, which has been ignored over the years, there is provision for a recurrent grant. The Grants Commission recommended Commonwealth assistance of $2,574 per head merely to keep the Northern Territory on par with the States. Clearly, it is not a voracious appetite. It is a grant to maintain the standard of living that all other States enjoy. I believe very clearly that the people of the north-the people of the outback, including those in the Northern Territory-have some right to have a parity of living standards. So under the circumstances the Northern Territory should not be attacked or punished for this situation, which appears to be the case. The other allegations made by Senator Walsh were based on his approach of smearing. He said that accounting firms in Darwin were involved in wide scale tax evasion. He stated: . . . presumably that matter must have been known to the Chief Minister. What is his evidence for that allegation? The Chief Minister-at the moment it is Mr Everingham-or anyone in that position is not privy to Australian Taxation Office demands. Surely the Minister would know that section 16 of the tax Act makes that impossible. Senator Walsh suggested that tax evasion was rampant in Darwin because of the lower charges and stamp duties. That is nonsense. Senator Walsh is confused. Is it not a fact that the lower tax charges and duties have absolutely nothing to do with tax evasion? Further, is it not a fact that the reason that the companies came to the Territory was to enjoy the benefits of lower taxes and charges? If companies came to enjoy these benefits, they would pay the charges. How is this, then, tax evasion? Indeed, what does this have to do with tax evasion? Senator Walsh attacked Sir Victor Garland, who he had previously alleged had had involvement with bottom-of-the-harbour schemes. By naming Sir Victor, Senator Walsh was clearly indicating the type of tax evasion to which he was referring-namely, the dry and wet Slutzkins. Yet there is no link whatsoever between these tax avoidance and evasion schemes and levels of duties and charges . I should add that the cowardly attack on Sir Victor was baseless, as was later shown. Despite the attempt to smear Sir Victor Garland, a report of today or perhaps yesterday has suggested that he will be kept on as High Commissioner in London for his distinguished service and high reputation. Senator Walsh claimed, too, that the firm of Peat, Marwick and Mitchell in Darwin had facilitated tax evasion. That is a baseless smear. That firm has never promoted tax evasion schemes and I challenge Senator Walsh to prove otherwise and, also, to go outside the chamber and make the charge. When I say ' prove', I mean provide evidence and not just throw dirt. Finally, Senator Walsh claims that nearly all members of the accounting firms in Darwin are members of the Country-Liberal Party. All I can say in reply to that is that the Country- Liberal Party Treasurer will be delighted to know of this hidden and secret membership. Perhaps after today they may join the CLP. I seek leave, Mr Deputy President, to incorporate in Hansard a statement made by the Chief Minister of the Northern Territory refuting Senator Walsh's smear and a letter from the Chief Minister to the Prime Minister (Mr Hawke) outlining the Commonwealth Grants Commission recommendations about which I have just spoken. I have referred to the Minister the papers which I wish to have incorporated and I seek leave to have them incorporated in Hansard. The DEPUTY PRESIDENT —Is leave granted? Senator Walsh —No, the papers have not been shown to me. Senator KILGARIFF —I raise a point of order, Mr Deputy President. These were referred by the Government Whip to the Attorney-General, Senator Gareth Evans, and he indicated that they were acceptable to the Government for incorporation in Hansard. The DEPUTY PRESIDENT —Senator Kilgariff, one voice refusing leave is sufficient. Leave is not granted. Senator Crichton-Browne —As long as it is recorded, that is fine. Senator KILGARIFF —It is a strange thing. I always understood, as a Government Whip, that when I approached the Opposition or Opposition members came to me with papers and a Minister said those papers should be incorporated-no matter how much they may have embarrassed a particular person-if that approval was given it was the rule that those papers were incorporated. It is most strange tonight that the Attorney-General should have given permission for the incorporation, yet the Minister for Resources and Energy, Senator Walsh, refused permission. I suggest that senators on the Government side settle down for a while. Senator Robertson —I raise a point of order, Mr Deputy President. It is not completely a point of order but perhaps I may suggest that because of the misunderstanding-it was simply a misunderstanding that the papers had not been seen-should Senator Kilgariff seek leave again to have the matter incorporated, I am sure that he would receive a favourable reception. Senator Crichton-Browne —I raise a point of order, Mr Deputy President. This also is not entirely a point of order. Is Senator Walsh conceding that he was wrong and that he will accept it, or are we hearing only from the Whip? The DEPUTY PRESIDENT —That is not a point of order, Senator Crichton-Browne. Senator KILGARIFF —Mr Deputy President, I accept the offer made by the Government Whip. Once again, I seek leave to have these documents incorporated in Hansard. Leave granted. The documents read as follows- (Transcript) ADJOURNMENT DEBATE BY THE CHIEF MINISTER OF THE NORTHERN TERRITORY-TUESDAY, 31 MAY, 1983 . . . an answer given in the Senate today by Senator Walsh, Mr Speaker I would advise you the question was asked by none other than our Territory watchdog, the good Senator Robertson, who we usually don't hear from one year to the next and who stayed away from the Territory the weekend after the Government brought down its mini-Budget advising that it wasn't going to fund the construction of the railway. This is portion of the transcript of the good senator's or Minister's answer: ''Mr President, with respect to the latter part of Senator Robertson's question where he mentions the Northern Territory was dependent upon Commonwealth revenue I was aware of the fact-indeed, I have noted from time to time that nobody has a more voracious appetite for Commonwealth money than the present Northern Territory Chief Minister, although incongruously no-one is a more vocal critic of the Commonwealth taxes which raised the revenue which he now so voraciously consumed.'' Mr Speaker, I am anxious to be told where I've critised the system of tax and said it should be more equitably distributed, but not tax. ''For example he has a proposal now at an alleged time of financial stringency to increase the size of the Northern Territory Parliament by six members to the point where there would be one member of Parliament plus lavish staff provisions for every 2,000 people. Well, Mr Speaker, obviously the opposition is going to reconsider the fifteen or so staff that they've got and I've no doubt I'll be hearing from them in the next few days offering their staff back, all in the interests of restraint. ''I am also aware that the other matter to which Senator Robertson has drawn attention that Darwin has been used, (or the officers of accounting firms in Darwin) on a very wide scale, to assist tax avoidance and tax evasion and presumably that matter must have been known to the Northern Territory Government and the Northern Territory Chief Minister. Indeed one may even wonder whether it was done with that deliberate intent so that although the Northern Territory Chief Minister has a heavy demand on Commonwealth Revenue he has been simultaneously through the provisions of charges of stamp duties which facilitated tax evasion helping to erode the Commonwealth taxation base. I myself, Mr President, whilst searching documents in the Perth Corporate Affairs Office in respect to a former Minister in the Liberal Government, Mr Garland, have noted that the transactions which were documented there-the shuffle of assets of ownership over 2 States and 1 Territory was facilitated by the office of Peat, Marwick and Mitchell in Darwin. As noted that firm of accountants and many other firms of accountants in Darwin have facilitated tax avoidance and evasion for a vast number of transactions. I also of course understand that not all certainly, but nearly all, members of Darwin firms-accountancy firms . . .'' He made a slip there-nearly all members of Darwin firms he nearly said- '' . . . which facilitated those activities are deeply involved in the Country Liberal Party of the Northern Territory.'' and I'm pleased that nearly every member of every accountancy firm in Darwin will be pleased to hear that he is a member of the CLP and I'll advise our Treasurer to send them statements tonight seeking payment of their back fees for the period of their residence in the Northern Territory. But Mr Speaker it's obvious that Senator Walsh doesn't know what he's talking about about tax and he knows as little about tax as he knows about the uranium industry on which he's made some extraordinarily bad mistakes in statements to the Press-gaffes which show his complete naivity in dealing with a most complex industry. Just let me tell you about the so called tax avoidance that the Territory assists by having a lower stamp duty than elsewhere. Each State and the Territory, Mr Speaker, has the right to set its own level of stamp duty on instruments evidencing commercial transactions. The States have, in respect of share transactions, applied a uniform level of duty for many years . In the Territory there was no duty at all prior to self-government under Commonwealth administration. We have introduced such a duty but, in the absence of locally listed companies and to keep the administrative costs of our small tax office down to a reasonable level, applied it at a relatively low level and at a flat rate. If we had to create a share valuation capacity in the same way as the States, a very sophisticated bureaucratic structure would be required. This is not warranted in our circumstances. The cost of collection would have exceeded the returns. For these reasons it's not true to say that the lower level of duty in the Territory inflated our demand for residual Commonwealth funding. Higher rates of duty in the States did make it profitable for certain share transactions to be carried out in the Northern Territory rather than in the States where the company to which the shares related was situated. The so-called 'Darwin shuffle' was the means adopted by many such companies to avoid payment of duty in their home State. The mechanics of the scheme involved the opening of a branch share register in the Northern Territory. When shares were to be transfered, the transaction would be registered in the Darwin register: Northern Territory stamp duty would be paid, and the register closed and returned to the relevant State. Duty was not payable in the home State because the liable instrument was at no relevant time in the home State. Stamp duty being a tax on instruments requires an instrument in the jurisdiction at the relevant time to attract the tax. It was the State, not the Commonwealth, tax base which was eroded each time such a branch register was opened and used in this way. Each State had the power to stop the practice-simply by declaring transactions or branch registers of companies incorporated in their State to be liable to duty as though the transaction had been processed through the principal register. All States have now legislated in this way and the practice has ceased. The Territory has co-operated with the States in ensuring that avoidance by choice of jurisdiction is minimised. The Treasurer met with the Commonwealth Treasurer and the Treasurers of all States last year and subscribed to a joint approach for common action to combat this and other forms of avoidance. It is expected that more detailed plans for translation of this accord into State and Commonwealth legislation will be formulated at further meetings to be held later this year. . . . and of course, Mr Speaker, the honourable the Senator the Minister in the Senate for Resources and Energy too was inferring that the Northern Territory is generously funded-is over-funded-is embarrassed by funding from the Commonwealth , to use the Leader of the Opposition's words, and I can't do better than to read into the record, Mr Speaker, the letter I handed the Prime Minister last Friday. And of course there was the slander by the senator which I bet he's not game to repeat outside the House of accountants in Darwin and particularly he mentioned the firm of Peat Marwick and Mitchell and we know why he did that, Mr Speaker. It's because Peat Marwick and Mitchell is a firm in which the Northern Territory 's CLP President, Mr Graeme Lewis, is a partner, and it was a firm that acted for Sir Victor Garland in Perth, and I am told that what was done in 1977 apparently in accordance with Sir Victor Garland's instructions was to divest himself of private interests after he was elected to the national Parliament and whatever steps were taken were perfectly in accord with the law. And, Mr Speaker, we might wonder why all this sort of garbage is coming out in the Senate at the moment and I want to tell you why, Mr Speaker, because the Senator and the Federal Government is trying to soften up Territorians for another blow below the belt. During my visit to Canberra last Friday to see the Prime Minister regarding the railway I sought an appointment with the Minister for Resources and Energy, Senator Walsh, and the purpose of my visit to him was to determine what progress had been made by the Commonwealth Government towards endorsing the arrangements under which the Commonwealth will continue to subsidise public electricity supply in the Territory and contribute towards the cost of the channel. I'm sure no member of this House will need to be reminded how crucial these arrangements are to the economic viability of the Territory. In broad terms users will pay $ 50 million this financial year for their electricity according to tariffs which are already amongst the highest in Australia. The subsidy from the Commonwealth will provide the remaining $58 million that the Electricity Commission needs to meet its fuel bills, other operating expenses and debt changes for the year. It takes no great skill in arithmetic to work out that without the Commonwealth subsidy electricity consumers would be paying more than double the amount they are at present. This comes about because we're isolated and dispersed across one sixth of Australia, compounded by the fact that we were lumbered at self government with an expensive unreliable oil fired power system to meet our needs . In recognition of those inescapable facts the memorandum of understanding provided for an ongoing subsidy, together with Commonwalth funding assistance towards the replacement of Stokes Hill by a coal-fired station. The memorandum specified that, following some years of interim subsidy arrangements and identification of the replacement power station, more permanent arrangements would be put in place. That is what we negotiated with the Commonwealth Government last year. I regret to advise the House that I came away from last week's meeting with Senator Walsh with the gravest apprehension that this could be yet another area in which the new Commonwealth Government is preparing to welch on a firm commitment to Territorians. The now-familiar signs are there. In a letter of 17 May this year acknowledging a recent reminder letter from me, Senator Walsh stated that (and I quote): 'Cabinet will be reviewing the proposals made to you by the former Government'. Senator Walsh knows full well that negotiations with the former Government had gone far beyond the stage of unilateral Commonwealth proposals by the time of the Federal election. Indeed, all essential principles were agreed between Mr Fraser and myself here in Darwin almost a year ago. Let there be no illusions about the existence of an agreement long before the Hawke Government came to power. On 16 March 1982, Mr Fraser began his letter to me in the following terms: (and I quote) 'I am pleased to advise you that decisions have been taken to assist the Northern Territory in the funding of the proposed coal-fired power station and in providing continuing subsidy support for the operations of the Northern Territory Electricity Commission in the period to 1986-87.' We differed on a couple of aspects of the arrangements as proposed and, after further consideration, the Prime Minister wrote to me again on 29 June 1982 modifying his proposal in a fashion acceptable to both Governments. He concluded his letter as follows: (and I quote again) 'Subject to your concurrence with these conditions, I propose that Sir John Carrick and Mr Perron finalise the terms of a Ministerial agreement covering the electricity subsidy arrangements'. I provided my concurrence (by letter) on 30 June 1982. Only the fine detail of the formula and administrative arrangements then remained to be settled between officers of the two Governments. Most were in place, I am advised, by early November and the last was settled in February, and Mr Speaker they've been paying us the subsidy in accordance with those arrangements since the Hawke Government came to power. The Treasurer, Mr Perron, approved the detailed formula and administrative arrangements on 17 February and wrote immediately to Senator Carrick suggesting that he formally endorse them, thus concluding the process agreed between the Chief Minister and Prime Minister. The Federal Election intervened before that formality took place. Despite all the correspondence, Ministerial meetings and confirmation repeatedly provided, the new Minister has chosen to put the arrangements up for grabs as if no agreement existed. He has done this, as I understand it, solely on the grounds that the Commonwealth Government has a big deficit problem in the coming financial year. Honourable Members will recognise an all-too-familiar theme. Another long-term arrangement crucial to the viability of the Northern Territory is being threatened because of the Commonwealth's immediate budgetary problems. After the tax share and capital grants, the electricity subsidy is the largest component of our Commonwealth funding. Senator Walsh assured me that some sort of subsidy would continue, but is clearly looking for a means of cutting it back as from next financial year. I remind honourable members again, however, of the consequences if he should succeed. Every dollar held back by the Commonwealth would have to be replaced through higher electricity tariffs. Without the subsidy, electricity charges would be more than double what they are today. That is unthinkable. Any tinkering with the agreed arrangements to reduce the level of subsidy would be turning a blind eye yet again to equitable and binding arrangement reached with the previous Government. New Governments which do that within our democratic system cannot hope to retain any credibility at all. I hope that commonsense and honour will prevail, Mr Speaker, and that my fears prove to be groundless. . . . . Prime Minister, I felt it was imperative that I see you, since I believe you are being misinformed about the Territory's financial capacity. Your Government's proposal on the railway makes that clear. Both you and Mr Keating have referred during the last week to the fact that the Territory receives five times the State average per capita, in Federal funding. Your Treasurer stated publicly last Thursday that this funding level is very generous, and your letter to me implied that you share that belief. The overall level of Federal assistance to the Northern Territory for recurrent purposes has been tested every year since Self-Government by the Commonwealth Grants Commission. Its most recent report, for 1980/81, determined that the Territory warranted additional assistance of $11.8 million over and above other Commonwealth grants in order to enable Territorians to receive a level and quality of services no more and no less than those enjoyed in NSW and Victoria. It reached that judgment after surveying Territory revenue sources and calculating what could be raised by the Territory Government exerting the same revenue effort as in those States. There is no reason to doubt that this position has changed significantly in the last two years, except that the need for supplementary Federal assistance has almost certainly grown. The fact that our overall Federal funding is five times as great per head is because it costs that much more to treat Territorians like other Australians. You must have seen in your own visits to the Territory why this is so. Isolation , distance, diseconomies of small scale, the high proportion of aboriginals in the population . . . the list sometimes seems endless. Your Government's requirement on railway funding could only be met, therefore, by a combination of lowering the standard and quality of NT government services to a level further below those of the southern States, just when we are starting to make progress towards achieving those standards and raising the Territory's taxation effort to a level above that of the southern States. I despair at the difficulty I have in getting that simple fact through. We are not overfunded-it just costs a hell of a lot more to do normal government business in the Northern Territory. We are not undertaxing our population, because the Grants Commission procedures ensure that the Commonwealth would not contribute an additional cent to balancing our budget. I am not prepared to tax Territorians to fund a national asset-they meet their full share already through Commonwealth taxation. Likewise I am not prepared to sacrifice Territory schools, medical services, aboriginal essential services and other government services that Australians elsewhere enjoy. The Northern Territory accepted self-Government only with an assurance that the Commonwealth would provide a sufficient level of financial assistance to enable State-type services to be provided by the Territory Government at a level and to a standard commensurate with the States. This assurance was provided through the Memorandum of Understanding and supported by the extension of the purview of the Grants Commission to include the Territory. There is consequently no need for you to accept my assurance that the Territory is not over-funded, and that it does not have the capacity to fund even part of a national railway. Ask your own independent authority-the Grants Commission. It will lay to rest once and for all the mischievous misuse of statistics regarding the Northern Territory's true financial position. P. Everingham 27 May 1983 A. In its report on 1980-81, the Grants Commission assessed that it cost $3,035 per head of population in the Northern Territory to provide standard government services, compared to $926 in New South Wales and Victoria - Northern Territory overall cost disability ($3,035 less $926) was $2,109 per head - major disabilities in that included Government primary schools $277 per head General medical services $363 per head Essential services to remote (aboriginal) communities $188 per head Police and justice $185 per head Local Government and town planning $99 per head the Territory revenue base could yield $356 per head from standard revenue- raising effort, compared to $420 in New South Wales and Victoria - Northern Territory revenue disability ($356 less $420) was $64 per head total Northern Territory disability $2,173 per head B. The Grants Commission also assessed that total Commonwealth assistance for Northern Territory recurrent purposes was $2,574 per head, compared to $499 in the standard States - Northern Territory advantage ($2,574 less $499) was $2,075 per head - it is a fact that Northern Territory gets, and needs, five times the standard in Commonwealth assistance. C. The Grants Commission assessed, therefore, the Northern Territory was still $ 98 per head short ($2,173 per head disability less $2,075 per head advantage) of what was required. - $98 x 120,000 people = $11.8 million special assistance recommended. D. The assessment is now two years out of date, but Grants Commission will report in September on its assessment for 1981-82. - following the Commission's methodology, we calculate that the shortfall has grown substantially E. Regarding capital funding for the Northern Territory, the base allocation at self-government (simple extension of previous Commonwealth spending) has grown only at the same rate as the States - no allowance for Northern Territory's exceptional population growth - decreased in real terms overall, and even more so per capita. Senator KILGARIFF —I thank the Senate. Senator COLLARD(Queensland)(10.40) —I will not delay the Senate for too long. I want to raise two matters. The first is brought about by the Press release on 19 May 1983 by the Minister for Resources and Energy (Senator Walsh) in which he announced the abandonment of the previous Government's Bicentennial Water Resources Program. I refer to the Burdekin Falls dam project in north Queensland . I remind the Minister that prior to the Bicentennial Water Resources Program, that project was the subject of a joint agreement between the Queensland State Government and the then Federal Government. The arrangement basically was that the Federal Government would build the dam wall and the State Government would pay for all the ancillary works, some of which I understand are now in progress. Can the Minister advise me tonight or in the near future of the status the Government now gives to the Burdekin Falls dam project? The second point I raise in the adjournment debate is what appears to be an anomaly appearing in the annual reports of both Trans Australia Airlines and Ansett Transport Industries Ltd. The saying is that figures do not lie but figurers do lie. An amount of $101,954,000 appears in the TAA report under the heading 'Contributions to Government Revenue'. In the Ansett report under the heading 'Government Charges' there appears an amount of $55,176,738. The figures for the two airlines, which run basically the same sort of service over the same sorts of routes, show a difference in the vicinity of $46m. When one recognises that Ansett's profit before tax was about $48m and that there has been criticism of TAA's performance, those figures are a little extraordinary. I would greatly welcome some explanatory note on this matter from the Minister for Aviation (Mr Beazley). Senator WALSH(Western Australia-Minister for Resources and Energy)(10.43) — Firstly, I will deal with Senator Kilgariff. Apparently, he is not in the chamber now. He failed to notify the Whip tonight that he intended to speak about a matter that involved me. I understand that it is standard practice to do so. However, I happened to be in the chamber so I do not particularly mind that. There is highly visible evidence of extravagance in the Northern Territory Government as I told the Chief Minister when he was in Canberra last week. I will cite a few examples. The Chief Minister has a proposal now to expand the number of members in the Legislative Assembly by six so that there will be one member for just over every 2,000 voters. He travelled to Canberra, I think, last month in a chartered aircraft at a cost of $16,000 for himself and a couple of politicians and public servants. The glossy publications which come out of the Northern Territory Government are rivalled only by those which come from the Government of Queensland. The head of the Northern Territory Department of Treasury receives a higher salary than the head of the Commonwealth Department of the Treasury. Without wishing to cast aspersions on the relative judgments about the capabilities of the two respective people, I find it rather extraordinary that the head of the Treasury in a Territory which has a voting population of around 60,000 people receives a higher salary than the head of the Commonwealth Treasury. Ministers in the Northern Territory have more ministerial staff than the Ministers of this Government. I suggest that the examples I have given are highly visible evidence of extravagance. Also, Northern Territory members of the Northern Territory Legislative Assembly are paid a higher salary than the members of this Parliament. With respect to the facilitating of tax evasion, the Northern Territory Government deliberately set lower share transfer duties. Having set those lower share transfer duties the facilities offered by the Northern Territory were widely used-as anyone who has ever searched any corporate affairs documents in search of this sort of thing would know-for temporary transfers of share registers to Darwin in the process of tax evasion. The Chief Minister must surely have noticed the enormous revenue accruing to his Government because of the extraordinary amount of share transfers being processed through Darwin as one of the steps in a chain of tax evasion activity. Surely he must have noticed the revenue that that was bringing in. The Territory, with a total population of about 130,000 people and a city with a population of about 60,000 people, had a share transfer revenue grossly disproportionate to the amount of business which would normally be expected to take place in such an area. I give an example of a stereotype case. As I mentioned, anyone who has searched corporate affairs documents would have seen countless similar examples of this sort of transaction. Three companies were registered in Perth-the Frederic Salon , Greenbank and Stirling West companies. The principal shareholder in all of them happened to be Ransley Victor Garland. My source for this is the Corporate Affairs Office in Perth. It has all been put on the record in the Parliament before. I do not actually have the documents with me to incorporate again but I recall the case clearly. Peat Marwick Mitchell and Co., through its office in Perth, transferred the shares in these companies to its office in Darwin, where they were held for a very short period-I think a couple of days-and then transferred to Melbourne. The companies finished up in the hands of one Ian Stafford Collie, who is now in the dock facing criminal charges relating to tax evasion. I do not think I need to say any more except to repeat that the deliberate establishment by the Northern Territory Government of lower charges for share transfers for the purpose of attracting revenue to that Government facilitated widespread tax evasion. In respect of the status of the Burdekin project, the matter raised by Senator Collard, I make several points. The irresponsible supplementary water resources program of the previous Government was cancelled in the statement of the Treasurer (Mr Keating) on 19 May. As an example of the degree of discipline which was applied to the selection of projects by the previous Government, the program included $5m for a feasibility study of the Bradfield scheme. It was hailed by the then Prime Minister as another Snowy scheme. Without going into the economics of it, I make just one point: The simple fact is that in the Snowy scheme the water descends about 400 metres and generates large amounts of electricity but in the Bradfield scheme it had to be pumped uphill about the same distance and would have consumed enormous amounts of electricity, so much so that, according to the report of Cameron, McNamara and Partners, the annual cost of pumping per irrigated hectare on the other side of the Great Divide would be $1,500. That was hailed by the then Prime Minister as another Snowy scheme. The Burdekin project was never part of that supplementary water resources program and it is still under review. I expect a submission on this matter to go to Cabinet shortly. In respect of Ansett Airlines of Australia and Trans Australia Airlines, I have no direct knowledge of the matters raised but I will endeavour to obtain an answer from the relevant Minister. Question resolved in the affirmative. Senate adjourned at 10.48 p.m. The following papers were presented: Air Force Act-Regulations-Statutory Rules 1983 No. 63. Christmas Island Act-Regulations-1983-No. 1 (Customs Airports (Amendment)). Defence Act-Regulations-Statutory Rules 1983 No. 61. Defence Amendment Act-Interim Determinations-Statutory Rules 1983 Nos 58, 59. National Parks and Wildlife Conservation Act-Regulation-Statutory Rules No. 66. Naval Defence Act-Regulations-Statutory Rules 1983 No. 62. Petroleum Retail Marketing Sites Act-Regulation-Statutory Rules 1983 No. 60. Public Service Act-Regulations-Statutory Rules 1983 Nos 55, 57. Seat of Government (Administration) Act-Ordinance 1983-No. 8-Fireworks ( Amendment). Weights and Measures (National Standards) Act-Regulations-Statutory Rules 1983 No. 64. World Heritage Properties Conservation Act-Proclamations, dated 26 May 1983 (10 )-Regulations-Statutory Rules 1983 Nos 65, 67. The following answers to questions were circulated: Question No. 120 Senator Kilgariff asked the Minister representing the Minister for Home Affairs and Environment, upon notice, on 4 May 1983: (1) What opposition is there to the erection of motel-style accommodation at Jabiru in the Northern Territory. (2) Have any proposals been received for the erection of such accommodation. (3) When will approval be given to go ahead with building accommodation. (4) Who is involved in making this decision. Senator Ryan —The Minister for Home Affairs and Environment has provided the following answer to the honourable senator's question: (1) The Plan of Management for Kakadu National Park provides for overnight accommodation for visitors to the mining operations and guests of people living in the town. (2) Yes. (3) Approval has been given. (4) The decision was made by the Minister for Home Affairs and Environment following discussions held between the Australian National Parks and Wildlife Service and Northern Territory officials. Senator Gietzelt —On 12 May 1983 Senator Zakharov asked me, as Minister representing the Minister for Transport, the following question without notice: Does the Government intend to make provision in its Australian Bicentennial Road Development Program for the funding of bicycle tracks and routes, thereby contributing to health, safety and energy conservation? The Minister for Transport has provided the following information in respect of the honourable senator's question: The Government's National Transport Policy Statement provides, inter alia, for the upgrading of the status of bicycle transport throughout Australia. Commonwealth funding is already available for the construction of bicycle paths under both the Roads Grants Act and the Australian Bicentennial Road Development Trust Fund Act, where a path is associated with road works. Options for extending the scope of Commonwealth funding for bicycle paths are currently under consideration by the Government.