Tuesday, 15 November 1983 The PRESIDENT (Senator the Hon. Douglas McClelland) took the chair at 2 p.m., and read prayers. Senator BUTTON(Victoria-Leader of the Government in the Senate) —by leave-I inform the Senate that the Minister for Sport, Recreation and Tourism, Minister for Administrative Services and Minister Assisting the Minister for Industry and Commerce (Mr John Brown) left Australia on 12 November to resume leadership of a parliamentary delegation and to hold ministerial discussions in London, San Francisco, Los Angeles and Tokyo. The Minister for Home Affairs and Environment (Mr Cohen) is Acting Minister for Sport, Recreation and Tourism and the Minister for Communications (Mr Duffy) is Acting Minister for Administrative Services and Acting Minister Assisting the Minister for Industry and Commerce until Mr Brown returns. I also inform the Senate that the Minister for Science and Technology (Mr Barry Jones) left Australia on 11 November to attend an Organisation for Economic Co- operation and Development conference in Japan and to hold discussions in Korea on high technology industries. The Minister for Transport (Mr Peter Morris) is Acting Minister for Science and Technology until Mr Jones returns. The Clerk —Petitions have been lodged for presentation as follows: 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 implemention 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 discribed 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 among 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 Senator Sir John Carrick (from 271 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The humble petition of the undersigned citizens respectfully showeth: That the Sex Discrimination Bill 1983 contains provisions inconsistent with principles of justice and equality which could be used to: Undermine civil liberties and religious freedoms; Entrench abortion funding and render liable to action Hospitals, Doctors and Nurses, who conscientiously refuse to become involved in morally objectionable operations; Deny to parents their rights to insist that the school 'community' provide an environment conducive to the development, including moral development of their children. Your petitioners humbly pray that the Senate, in Parliament assembled: should amend the Bill so as to prevent the possibility of its use in the manner stated above and urge, because of the importance to society of all principles involved, that a conscience vote on the Bill be permitted to all Members of Parliament. And your petitioners as in duty bound will ever pray. by Senator Collard (from 10 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The humble petition of the undersigned citizens respectfully showeth: That the Commonwealth Sex Discrimination Bill 1983 could be used to support the provision by the Commonwealth Government of funding, counselling, etc. for deliberately procured abortions. Your petitioners humbly pray that the Senate, in Parliament assembled: should amend the Sex Discrimination Bill so as to prevent it from being used in support of deliberately procured abortions. And your petitioners as in duty bound will ever pray. by Senators Peter Baume (from 126 citizens), Bjelke-Petersen (from 60 citizens), Sir John Carrick (from 365 citizens), Chaney (from 161 citizens) and Crichton-Browne (from 315 citizens). To the Honourable the President and members of the Senate in Parliament assembled: The humble petition of the undersigned citizens of Australia respectfully showeth: 1. That an airport in the north-western region (commonly called Scheyville) imposes disastrous economic, environmental and social costs on our community. 2. An airport would destroy 2,000 households and impose upheaval, noise and pollution on one million people presently unaffected. 3. The cost of an airport in the north-western region is greater than the alternatives, whilst fog and close proximity to R.A.A.F. Base Richmond would make operations impractical. 4. It would destroy the historic village of Pitt Town, environmentally important wetlands, and their unique adherent wildlife. 5. Your petitioners reject these proposals and call for endorsement of the MANS Committee findings. And your petitioners as in duty bound will ever pray. by Senator Peter Baume (from 785 citizens). To the Honourable the President and members of the Senate in Parliament assembled: The petition of certain elected representatives and officers of local governments in Australia shows that General revenue grants to local government under personal income tax sharing entitlements have increased by 8.2 per cent in 1983-84 over 1982-83, The inflation rate over the same period was 11.2 per cent, The increase in grants to State governments over the same period was 11.8 per cent, Increased demands are being made on local government authorities to participate in Federal Government programs e.g. Community Employment Program, The Labor Party made a pre-election commitment to allocate not less than the real value of the previous year's allocation in general revenue grants to local government. Your petitioners therefore pray that the Government will amend the Local Government (Personal Income Tax Sharing) Act of 1976, to provide a real term minimum guarantee to local government general revenue sharing arrangements in 1983-84, and in future years. And your petitioners as in duty bound will ever pray. by Senator Peter Baume (from 12 citizens), Boswell (from 75 citizens), Sir John Carrick (from 15 citizens), Hill (from 13 citizens), Lewis (from 40 citizens) and Messner (from 19 citizens). To the Honourable the President and members of the Senate in the Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth: That the 1983 Budget imposition of the excise on grape spirit used in fortifying wine places at risk the future of the fortified wine industry in Australia. That the requirement to pay the excise within 7 days of the fortification occurring is inequitable. That the excise will be reflected in increased costs to the consumers of fortified wines of up to 100 per cent and consumer choice will be restricted. That this will cause reduced fortified wine sales which will result in reduced intake of grapes from grapegrowers. Your petitioners therefore humbly pray that the Federal Government will reconsider their previous decision and either withdraw this tax or modify its method of application and collection. And your petitioners as in duty bound will ever pray. by Senator Messner (from 27 citizens). To the Honourable the President and members of the Senate in Parliament assembled: The petition of the undersigned shows- That, with the exception of the Australian Capital Territory and the Northern Territory, all State Parliaments have enacted chiropractic legislation. That chiropractors provide a safe, effective and economical health care service that is complementary to medicine. That the introduction of a Federally funded health care system restricted to the services provided almost exclusively by the medical profession restricts the freedom to select the health care practitioner of one's choice. That a financial disadvantage will be incurred by those citizens utilizing chiropractic care, many of whom find that their health complaints do not respond satisfactorily to traditional approaches. Your petitioners therefore pray that the Senate in Parliament assembled ensures that chiropractic services are included in Medicare when it is introduced. And your petitioners as in duty bound will ever pray. by Senator Grimes (from 21 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's announced proposal to tax lump sum superannuation payments by up to 30 per cent is an unwarranted and unfair attack on the savings of Australians of average means and Whereas the development of our nation requires the application of large sums of capital which can only be generated locally by the savings of Australians and Whereas Government policies preventing the development of local capital only serve to increase Australia's dependence on foreign capital and Whereas the encouragement of thrift and self-help should be paramount in our society, We humbly pray that the Government will not proceed to impose a tax on lump sum superannuation payments above that presently existing. 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 Senator Peter Baume (from six citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth: That your petitioners are concerned about foreign owned military bases on Australian territory and the entry into Australian waters and territory of foreign warships and aircraft carrying nuclear weaponry. And that the Australian Government should take an active and constructive role in the promotion of a nuclear-free world. Your petitioners most humbly pray that the Senate in Parliament assembled should: 1. Promote the expression of Australian sovereignty by legislating to bring foreign military bases on Australian territory under the control of the Australian Government. 2. Make it compulsory that the disclosure of weaponry carried by foreign warships and aircraft be given in confidence to the Australian Government prior to a request for entry. And that foreign warships and aircraft that carry nuclear weaponry by banned from Australian waters and territory. 3. Legislate for the cessation of all uranium mining in Australia and its subsequent export. 4. Urge the Government of the Commonwealth of Australia to pose to the Governments of the United States and the Soviet Union that both countries agree to immediately halt the testing, production and further deployment of all nuclear weapons, missiles and delivery systems in a way that can be checked and verified by both sides. And your petitioners as in duty bound will ever pray. by Senator Coleman (from 210 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth. That every child in Australia is entitled to government financial support for their education whether they attend government schools or non-government schools . Your petitioners therefore humbly pray that urgent consideration be given to a favourable decision for the continuation of Federal Government per capita grants payable in respect of all children in non-government schools at a rate calculated as a percentage of Government standard costs at a level not less than that prevailing in 1983. And your petitioners as in duty bound will ever pray. by Senators Peter Baume (from 639 citizens) and Button (from 35 citizens). To the President and honourable Senators in Parliament assembled. The petition of certain citizens of Australia shows that we deplore the continuing presence of United States bases on Australian territory. Your petitioners therefore pray that the Australian Government urgently takes action to close all such bases. And your petitioners as in duty bound will ever pray. by Senator Coleman (from 104 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The Petition of the undersigned citizens respectfully showeth: That to this date no postage stamps have been issued to commemorate the services of the Australian Military Forces in the Occupation of Japan, Korea, Malaya, Malay Peninsular, Sabah, Sarawak and Vietnam. Your petitioners most humbly pray that the Senate, in Parliament assembled: should seek and support the issue of such commemorative stamps. And your petitioners as in duty bound will ever pray. by Senator Sir John Carrick (from 18 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of certain citizens of Australia, being parents and other persons concerned about the education of all children, showeth that the present Government has commenced a Policy of reduction and eventual abolition in Government funding to Independent Schools. This Policy has been adopted without an appropriate and reasoned consideration of the circumstances of those Schools and the parents who choose to send their children to them. In particular the Government, in making its decision, has failed to take into account the impact on the State School System of an increased enrolment of students who otherwise would have attended Independent Schools in the event that Government funding had not been reduced or abolished. The change in Policy overlooks the fact that the cost of educating a child in a Government School is two to three times the cost to the tax-payer of educating the same child in an Independent School. Your petitioners therefore humbly pray that the Senate in Parliament assembled reverse the decision of the Government and re-instate funding on an equitable basis as has been the case in previous years. And your petitioners as in duty bound will ever pray. by Senator Peter Baume (from 360 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned citizens, teachers and parents working in and for the interests of the pupils in government schools and colleges throughout Australia respectfully showeth that: 1. We deplore the unprincipled and self-interested attacks being orchestrated by minority sects and groups against the policies and person of the Commonwealth Minister for Education and Youth Affairs, the Hon. Senator Susan Ryan. 2. We fully support the Federal Government's actions in reducing funds for the wealthiest private schools, and in breaking the nexus between government and non -government school costs. 3. We endorse the Federal Government's principled opposition to the provision of 'base grants' to all non-government schools, as a positive step towards fulfilling their commitment of primary obligation to Australia's government schools. 4. We call upon the Federal Government however to recognise that its failure to create an adequate general recurrent resource base for government schools through providing increased recurrent grants, will undermine its own Special Programmes and thus frustrate its own stated educational objectives of greater equity and participation. 5. We support the Federal Government's stated policy of entering into direct negotiations for joint agreements on these grants with State/Territory Governments, to ensure a planned programme of improvements in government schools throughout the coming decade. And your petitioners as in duty bound will ever pray. by Senators Robertson (from 64 citizens) and Zakharov (from 16 citizens). Petitions received. Senator KILGARIFF(Northern Territory) —I give notice that, on the next day of sitting, I shall move: (1) That a select committee, to be known as the Select Committee on Volatile Substance Fumes, be appointed to inquire into and report upon the voluntary inhalation of volatile substance fumes, which particular reference to the health and social consequences of the availability of such substances to the community, particularly,- (a) to persons who have not attained the age of 18 years; and (b) where the practice of petrol sniffing has become endemic. Provisions relating to the membership, powers and proceedings of the Committee are contained in paragraphs 2 to 13 of this motion. I seek leave to have them incorporated in Hansard. Leave granted. The document read as follows- (2) That the Committee consist of six Senators, as follows- (a) three to be nominated by the Leader of the Government in the Senate; (b) two to be nominated by the Leader of the Opposition in the Senate; and (c) one to be nominated by the Leader of the Australian Democrats. (3) That the Committee proceed to the despatch of business notwithstanding that all members have not been duly nominated and appointed and notwithstanding any vacancy. (4) That the Chairman of the Committee be appointed by and from the members of the Committee. (5) That the Chairman of the Committee may, from time to time, appoint another member of the Committee to be the Deputy-Chairman of the Committee, and that the member so appointed act as Chairman of the Committee at any time when there is no Chairman or the Chairman is not present at a meeting of the Committee. (6) That, in the event of an equality of voting, the Chairman, or the Deputy- Chairman when acting as Chairman, have a casting vote. (7) That the quorum of the Committee shall be three members. (8) That the Committee and any sub-committee have power to send for and examine persons, papers and records, to move from place to place, to sit in public or in private, notwithstanding any prorogation of the Parliament or dissolution of the House of Representatives, and have leave to report from time to time its proceedings and the evidence taken and such interim recommendations it may deem fit. (9) That the Committee have power to appoint sub-committees consisting of three or more of its members, and to refer to any such sub-committee any of the matters which the Committee is empowered to consider, and that the quorum of a sub-committee be a majority of the Senators appointed to the sub-committee. (10) That the Committee be provided with all necessary staff, facilities and resources and be empowered to appoint persons with specialist knowledge for the purposes of the Committee with the approval of the President. (11) That the Committee be empowered to print from day to day such papers and evidence as may be ordered by it, and a daily Hansard be published of such proceedings as take place in public. (12) That the Committee report to the Senate by 5 June 1984. (13) That, if the Senate be not sitting when the Committee has completed its report, the Committee may send its report to the President of the Senate or, if the President is not available, to the Deputy-President, who is authorised to give directions for its printing and circulation and, in such event, the President or Deputy-President shall lay the report upon the Table at the next sitting of the Senate. (14) That the foregoing provisions of this Resolution, so far as they are inconsistent with the Standing Orders, have effect notwithstanding anything contained in the Standing Orders. Senator CHANEY —I ask the Minister representing the Prime Minister: Why did the Commonwealth Government fail to consult the Government of the Northern Territory about its intention to transfer the title of Uluru National Park to an Aboriginal land trust? Why was the formal advice of the decision telexed to Darwin too late for the Government there to be advised, prior to the Prime Minister's public announcement and after the Leader of the Opposition had been informed? How does he justify this high-handed treatment of the Northern Territory and its Government? Senator BUTTON —I am not sure that the purported facts in the Leader of the Opposition's question are correct, but I will address the question to the Prime Minister and obtain an answer, if possible, by the end of Question Time. Senator ELSTOB —My question, which is directed to the Minister representing the Minister for Employment and Industrial Relations, refers to the Federal Government's proposal for a national occupational health and safety commission. Firstly, can the Minister say whether the commission is likely to contain a preventative health component in its charter? Secondly, will the commission be laying down the rights and obligations of employees, employers and governments? Senator BUTTON —As I understand it, an announcement will be made shortly in relation to this matter by the Minister for Employment and Industrial Relations. In answer to the specifics of the honourable senator's question, let me say first of all that I understand that the commission will contain a preventative health component. In regard to the question of laying down the rights and obligations of employers and employees, I think that is a matter with which the commission will not be concerned. It is a matter which has been dealt with or is in the process of being dealt with in various State considerations of the same problem; namely, industrial health and occupational safety. That is a matter which is appropriately within the jurisdiction of the States and is not a matter with which the Federal commission would be primarily concerned. I am unable to say with definition at this stage whether there will be some provision relating to that matter. Senator KILGARIFF —My question, which is addressed to the Minister representing the Prime Minister, concerns the protest being staged against the joint Australian-United States defence facility at Pine Gap. Is the Minister aware that the Minister for Education and Youth Affairs, Senator Ryan, was one of 12 women Labor members of parliament who issued a statement last week expressing support for the Pine Gap protesters? Does he recall a recent answer in the Senate from Senator Gareth Evans, on behalf of the Minister for Foreign Affairs, in which he quoted Mr Hayden who, in a statement on the ANZUS treaty, endorsed the presence in Australia of facilities such as Pine Gap because of their contribution to the deterrence of nuclear war? Does the Minister believe that it is proper for a Minister to support publicly people who are demonstrating to reverse a policy endorsed by Mr Hayden? Senator BUTTON —I am aware of the Pine Gap protest and I understand that a number of Labor members of parliament sent a message to the protesters in support of the general concern being expressed by those protesters in terms of nuclear weapons, et cetera. My understanding is that Senator Ryan was one of the signatories to that message but I also understand that she specifically distinguished any comment she made about the protest in terms of the role and function of the base at Pine Gap and the Government's policy in relation to the role and function of that base. If Senator Kilgariff can construe the message that I saw in the terms which he suggests in his question, namely, that it supported total opposition to the Pine Gap base contrary to Government policy, I certainly did not read it that way. Senator CROWLEY —My question is directed to the Attorney-General. I have received a number of submissions from women and men in Alice Springs regarding the brutality in the treatment of women arrested at Pine Gap and of other possible breaches of human rights in the course of their arrest and detention. I understand that the Attorney-General has been involved in similar discussions. I ask: What action has he taken and has he any further proposals? In particular, is any consideration being given to the possibility of the Human Rights Commission sending an observer to Alice Springs? Senator GARETH EVANS —I was first made aware of these complaints on Sunday evening around midnight when I received a telephone call from Mrs Joan Coxsedge, MLC. I hasten to add that that is not a normal state of affairs. I have subsequently received several direct representations from or on behalf of women who have been arrested and I have, of course, seen the allegations that have been made in Press reports. The action I have taken is as follows: In response to Mrs Coxsedge's call, I telephoned shortly afterwards the officer in charge of the Alice Springs police station. I put to him a series of specific questions and received responses along the following lines: That the women were being charged with trespass under the Commonwealth Crimes Act and not under the legislation specifically relating to defence installations such as Pine Gap, in other words with a comparatively minor offence; that bail processing was proceeding as fast as possible with the exception that it was not possible to process either those who did not want bail or those who refused to give a correct name; that there was no question of denying the women access to lawyers and that lawyers were being allowed in to talk to anyone who requested a lawyer; and that there were no particular crowding problems as the cells were built for more than 100 people. There had been some difficulties with plumbing and matters of that kind but by that stage those had been resolved. That is where the matter rested on Sunday night. Requests were subsequently made to me and also to the Human Rights Commission that a human rights observer be sent to Alice Springs to monitor the proper observance of human rights standards in police and legal dealings with the women . I have now been advised, just a short time ago, that the Human Rights Commission-not in fact acting at my request but of its own volition-at a meeting convened this morning in Melbourne decided to send one of its officers to Alice Springs to inquire into the complaints and to identify any breaches of human rights that may have occurred. In the light of that, I have asked the Commission to provide me with a report as soon as possible. As to the behaviour of the police, I emphasise that the arrests and detention have been carried out by Northern Territory police, as I understand it, and not by Federal police, although the Northern Territory police have been acting under Commonwealth law. Questions of police behaviour and allegations of brutality-in respect of which I hasten to add that I have received no hard evidence of any inappropriate or excessive use of police power although such claims have been made-are, of course, primarily matters for the responsible Northern Territory Minister, in this case the Chief Minister, Mr Everingham. I note from this morning's Age report that a Northern Territory police spokesman said that there would be an investigation if there were any indication that injuries had been suffered by anyone in custody. I welcome that assurance and I hope that it also extends to an investigation of complaints that are made by people in custody. I mention that concern has been expressed about the availability of legal aid and I advise the Senate that in anticipation of difficulties such as have arisen the Australian Legal Aid Office in Darwin-again not acting with any Government direction but of its own initiative-did make special arrangements for a legal aid officer in Alice Springs to be available full time as a duty solicitor to provide urgent legal advice and representation. For those who pleaded not guilty and whose cases have, therefore, been adjourned, applications for legal aid will be processed in the usual way, with due attention being given to the merits of individual cases and the ability of applicants to pay. It is usually possible for applicants who are approved for legal aid to have the lawyer of their choice , but this may not, of course, be very practicable in a remote spot like Alice Springs. In conclusion, the action that I, the Government and various government agencies have taken should not be taken as implying, in turn, any support for the tactics employed by the demonstrators in question and, in particular, for the tactic of forcible entry. What our action does do is, I think, demonstrate very clearly our concern that basic human rights should be enjoyed by all members of the community however popular or unpopular may be the particular causes they are espousing. Senator CHIPP —The Minister representing the Minister for Foreign Affairs may recall a question which I asked him on 15 September and to which he replied that the Government was not aware that the Soviets had adopted a policy of launching on warning their nuclear arsenals on the basis of a computer warning because of the deployment of the Pershing missiles. I ask the Minister whether he has seen a article in the Weekend Australian which states: Soviet military sources have hinted recently that a policy of 'automatic launching' of Soviet missiles was under consideration as a response to the new US nuclear missiles. Is the Government aware that a Soviet newspaper and officials visiting West Germany have mentioned that 'launch on warning' was an option for the Soviets in retaliation? Does the Government not consider that the deployment of the Cruise and Pershing II missiles, being for political rather than military reasons, and forcing the serious consideration of a launch on warning policy by the Soviets, will be a destabilising, counter-productive policy that should be halted and reversed immediately? Is the Australian Government taking any action designed to bring about such a change? Senator GARETH EVANS —I have seen the report to which Senator Chipp refers. It is , of course, the case that there is considerable debate in Europe at the moment on every aspect of the North Atlantic Treaty Organisation intermediate- range nuclear force modernisation program. The article to which the honourable senator refers has to be seen in that context. The only response that I have been able to elicit from the Minister so far, in anticipation of this kind of question, is that we would not have expected the Soviet Union to make public its plans for the possible use of nuclear weapons or, for that matter, to be particularly likely to use Soviet journalists as official spokesmen in that respect. Senator Chipp —It often does. Senator GARETH EVANS —I appreciate that. The point has just been taken that, given the magnitude of the matters in issue here, it is a somewhat implausible route for such publicity to be given. But, given the gravity of the matters with which Senator Chipp's question is concerned, I will of course refer the matter to the Minister and seek a more detailed response to it. Senator COATES —Has the attention of the Minister for Resources and Energy been drawn to comments reported today in which it is suggested that 'as far as minerals are concerned, the present farrago of Commonwealth and State taxes, charges, levies, royalties and fees is hardly rational'? Can the Minister say whether this is a correct description of the situation? If so, what steps are he and the present Government taking to try to have a more rational resources taxation policy implemented? Senator WALSH —If I remember correctly, the words Senator Coates has quoted were used by Senator Chaney yesterday; that is, that as far as minerals are concerned , the present farrago of Commonwealth and State taxes, charges, levies, royalties and fees is hardly rational. I certainly agree with that statement. The problem appears to be, if Senator Chaney was accurately reported, that, having made that statement, he then proceeded to reject the rational alternative which this Government has proposed. I have not had an opportunity to read his complete speech, but from the reports of it that was the tone of it. I am disappointed by that. I have noted a couple of other things, though, which Senator Chaney is reported to have said, one of which is that the Government's whole approach to a resources rent tax has been masked in the language of economic rationality. I am not sure of the context in which that appeared, but it would appear to be implicitly critical of economic rationality. I would be interested to know why the Opposition is critical of economic rationality. Indeed, I suggest that it should try it some time instead of the mixture of redneck economics and political opportunism which it practised in government and which is responsible for its being where it is now-that is, in opposition. Senator PETER RAE —Does the Minister for Industry and Commerce recall his reply to me, during the debate on the Appropriation Bills on 2 November, that he had not obtained responses from the New South Wales and South Australian governments concerning their contributions to the steel industry plan but that he expected that a submission would be put to the New South Wales Cabinet shortly? Following reports of the Minister having rapped the New South Wales Government yesterday at Port Kembla, has the Minister seen the comment attributed to a spokesman for the State Minister claiming that further information will be on its way shortly, whilst another said that such concessions are something 'we are prepared to look at without being able to give an indication at this stage of how soon a decision might be made'? What action will the Minister now take to attempt to induce a more energetic approach from the Wran Government to remove this aura of uncertainty which is hanging over the prospects of the steel industry package? Senator BUTTON —To dignify this matter with the description of 'an aura of uncertainty' is, to say the least, indulging in hyperbole. The fact of the matter is that at no stage of the development of the steel package, as it has been described by Senator Rae, was a significant contribution sought from the New South Wales Government or the South Australian Government. But in answer to the substantive part of the honourable senator's question let me say that yesterday I received a letter from the New South Wales Minister responsible for industrial affairs informing me that he hoped to be able to provide me with an answer to the Commonwealth Government's request by the end of this month. That is the position as I now understand it. Senator TATE —Has the attention of the Minister for Education and Youth Affairs been drawn to an article in the Tasmanian Press concerning a newsletter circulated by the Principal of Dominic College in Hobart, Father John Papworth, expressing his concern about the Labor Government's policy of funding schools on a needs basis instead of tying grants to a percentage of the cost of educating a student at a government school? Did Father Papworth say, amongst other things: ' If the trend continues'-that is the trend in Labor policy-'we will be forced to put up fees, which will be a cause of a great deal of concern to parents'? I ask : What would Dominic College have received from the Commonwealth under the previous Government's funding policy? What will Dominic College receive in the first year of the new Government's funding policy? Will it be left entirely to Labor policy to determine the actual needs of schools, as Father Papworth implies? In general, are any Tasmanian non-government schools to receive less in real terms under Labor Government guidelines? Senator RYAN —My attention has been drawn to this matter and I must repeat that it is extremely disappointing when administrators of schools, who are of course in full possession of the information about the effects of the Government's new funding policies, make statements or make inferences which are quite inaccurate and quite misleading and no doubt cause great concern to the parents who receive these things. Dominic College, which is referred to in Senator Tate's question, is a non-systemic school in group 3. Had the previous Government's funding policy continued Dominic College would have received $739 for each primary student and $1,156 for each secondary student in 1984. As a result of our policies Dominic College will receive more than this: It will receive $741 for each primary student and $1,171 for each secondary student in 1984. That is a $2 increase for each primary student and a $15 increase for each secondary student. What this means in total is that, under Labor, Dominic College will receive some $15,063 more than it would have received had the previous Government's funding policy continued. I hope that the principal of the school will inform the parents of that fact. I hope that he will explain to them, if he decides to put up fees, why he needs to put up fees in the light of the considerable increase in recurrent funds that he has received from the Commonwealth under our funding policy. In regard to determination of a community standard for schools and a needs- based policy, I reiterate that it is the policy of this Government to fund according to needs. The Schools Commission will provide the Government with advice on the community standard. That advice will be provided after the Schools Commission has consulted widely with all non-government school bodies in all States and Territories in Australia. A first step in this consultative process has been taken already with the release by the Schools Commission last week of a document entitled 'Target Recurrent Resource Standards'. That document has been released for discussion and public comment. I look forward to receiving informed public comment on it. I conclude by saying that no non-government school in Tasmania will receive less funding in real terms in 1984 than it did in 1983 and the vast majority will receive more. Senator CHANEY —My question is addressed to the Minister for Education and Youth Affairs. Following the last question, I ask her whether it is a fact that, under the previous Government's policy, Dominic College and like schools had a guarantee of a fixed percentage of the cost of educating a State school child. Is it a fact that her Government and she, as Minister, have removed that guarantee this year and for the future? Senator RYAN —It is a fact that under the previous Government's policy Dominic College and other non-government schools were guaranteed a percentage of average government school costs but, of course, that guarantee meant that if increases in average government school costs were low-increases in costs, of course, are not going to be as rapid as they have been because of our Government's successful reduction of inflation and our wages and prices policy-although there would be some increase guaranteed, the amount of that increase could never have been subject to guarantee. All it meant was that Dominic College, a level three school, would have got the same percentage of whatever the increase was as schools with much more resources. In contrast, what Dominic College and all schools in similar positions have under our Government is a guarantee that they will receive more funding and that they will progress more quickly to a level where they have completely adequate resource standards to provide a high quality education to all of their children. They will proceed much faster to that level than they could have proceeded under the previous formula. Of course, under the previous formula there was no mechanism for closing the gaps between the very high resource schools and schools which are struggling. Senator CHANEY —I wish to ask a supplementary question. I welcome the use of the word 'guarantee' by the Minister in her answer. I ask her to confirm that she is guaranteeing that Dominic College and other level three schools will receive more under this Government than they would have received under the guarantee that previously applied. Senator RYAN —If Senator Chaney had addressed himself to the answer that I gave to Senator Tate, he would have heard the specific amounts of money which Dominic College will receive in 1984. In 1984 Dominic College will receive $15,063 more by way of recurrent grants than it received under the formula of the Government of which Senator Chaney was a member. Senator ROBERTSON —I direct my question to the Minister for Veterans' Affairs. Is the Minister satisfied that staff resources in the Darwin office of his Department are adequate for the needs of the Northern Territory's ex-Services community? If not, what action is he considering to improve the service? Senator GIETZELT —The Government has become increasingly concerned about information which shows that veterans are not aware of the benefits and facilities available to them from the Government. Consequently, it is extending its services to more centres and regional areas throughout Australia, and it has done that in recent months. I recall that Senator Robertson asked me privately several weeks ago about the Darwin office of the Department of Veterans' Affairs , which is run jointly as an office of the Department and of the Vietnam Veterans Counselling Service in Darwin. That was opened about 18 months ago, in May 1982, with a staff of two. Following Senator Robertson's inquiry, I instigated an examination of the officers' work loads. There is no doubt that the present facilities are inadequate, and I have decided that existing staff resources will be increased by an additional person, a full time clerical assistant, so that the inquiries being made by ex-servicemen in the Northern Territory can be properly attended to. I have also instructed my Department to keep the service under regular review so that if the increasing demand is still not being met by adequate staff arrangements we can increase the staff still further. Senator CRICHTON-BROWNE —I direct my question to the Leader of the Government in the Senate. In view of conflicting media reports, can he say whether the Government has made a decision concerning the declaration of Stage II of the Kakadu National Park in the Northern Territory? Is he aware of the widespread concern that any such decision in advance of a proper survey of the potential of this vast area will permanently lock away resources which could produce billions of dollars of income for all Australians? If it is not yet too late, will the Government take the advice of the Northern Territory Government to excise the Jabiluka uranium deposit from Stage II, declare only half of the second stage, and impose a conservation zone on the remainder, or will the Federal Government again ignore the wishes of that Government in an effort to square off with sections of the Labor Party enraged by the Caucus decision on uranium mining? Senator BUTTON —Mr President-- Senator Withers —Wait until after the election, he says. Senator BUTTON —I was not going to say that, but I am indebted to Senator Withers for the suggestion. An announcement will be made about Stage II of the Kakadu National Park at an appropriate time. However, there has been widespread newspaper speculation about the Government's decision on this matter. Senator Chaney —Speculation by the Minister, Mr Cohen. Senator BUTTON —Senator Chaney suggests that there has been speculation by the Minister, Mr Cohen. As I said, an announcement will be made at the appropriate time. As to the position regarding Jabiluka and Koongarra, it is my understanding that they will be treated separately from the decision in relation to Kakadu Stage II because of certain legal arrangements which have to be entered into with the Northern Territory Government and the traditional landholders. I am unable to advance any further information on that at this stage. Senator CRICHTON-BROWNE —I ask a supplementary question. Will the decision, when it is made, be made as a result of in-depth and careful deliberation, consideration and consultation with the Government of the Northern Territory? The PRESIDENT —Order! I regard that as not being a supplementary question. Senator HEARN —I address my question to the Minister representing the Minister for Foreign Affairs. It is reported that the United States Air Force has upgraded its strategic bomber force in the Pacific by replacing the 14 B52D aircraft stationed at Guam with the B52G aircraft, each capable of carrying 20 short-range Cruise missiles equipped with a nuclear warhead of the size of that carried by a Minuteman intercontinental ballistic missile, as well as the usual full bomb load. Are these B52G aircraft flying over Australian territory and using bases in this country? Are the missiles being unloaded before these aircraft fly over our land? Senator GARETH EVANS —Regrettably, the brief I had on this matter seems to have been mislaid. I assure the honourable senator and the Senate that there is nothing sinister whatsoever to be derived from that state of affairs. I will seek an early and appropriate answer for the honourable senator. Senator WALTERS —My question is addressed to the Leader of the Government in the Senate. Has Cabinet considered the question of compensation for miners and Aboriginals adversely affected by the Government's uranium decision last week? What amount has been claimed so far? What was the Government's estimate of amounts which would be claimed by the Northern Territory, the miners and the Aboriginals? Senator BUTTON —Cabinet has considered a number of issues relating to mining in the Northern Territory. Insofar as the question of compensation is concerned, if that question arises the Government will make an announcement at the appropriate time. I was asked, secondly, whether an amount of compensation has been assessed . The answer to that question is no; that is, assuming it to be a relevant question for the purposes of giving it an answer. In relation to any estimate of the amount which might be claimed, as Senator Walters put it in her question, by the Northern Territory Government on behalf of miners and traditional land owners, I do not think anybody in his wildest imagination could give an estimate here of the amount which might be claimed by the Northern Territory Government. If the Northern Territory does make such a claim, it will be rejected. If it made such a claim in a court, it would also be rejected. Senator WALTERS —Mr President, I ask a supplementary question. Is the Minister telling us that when the decision on uranium was taken by Caucus, no account was taken of what the taxpayer and the Government could be up for in compensation? If not, I cannot imagine on what basis it could possibly have come to its decision. Senator BUTTON —I am surprised that Senator Walters cannot imagine that; she can imagine everything else that comes into the deliberations in this place. No, I did not say that no account was taken of these issues, or that no account will be taken of them. But when the Government is in a position, having assessed all the facts, and not imagined them, to make a statement about this matter, it will do so. Senator RICHARDSON —My question is directed to the Minister representing the Minister for Aboriginal Affairs. It follows from a speech made in the Senate by my colleague Senator Reynolds. Is the Minister aware of a recent report on the Australian Broadcasting Corporation program Nationwide on the plight of Aboriginal employees at Queensland's Cape Flattery silica mine? It was reported that Aboriginal workers at the mine were on strike, not for extra pay or better conditions, but against the use of racist practices by the management of the mine. Can the Minister inform the Senate whether the Government or the Department of Aboriginal Affairs has investigated the allegations that discriminatory practices are in operation at the mine, and whether the dispute has satisfactorily been resolved? Can the workers, who were previously barred from joining a union, now join a union? Further, is the Government considering establishing mechanisms to monitor the health and safety conditions at the mine where the dangers of silicosis and other diseases related to handling of the fine silica dust are prevalent? Senator RYAN —My colleague Mr Holding has provided me with a brief on the matter raised by Senator Richardson's question. His attention had been drawn to a recent report on Nationwide, although he did not view it. He understood that the program covered the matter mentioned by the honourable senator; that is, the Aboriginal workers at Cape Flattery went on strike on account of alleged discriminatory practices at the mine. The terms on which the workers returned to the mine are known to my colleague's Department and I shall see that the details are provided to the honourable senator. On access to union membership, I am informed that the Australian Workers Union is endeavouring to arrange discussions on the matter with the workers. With regard to the health and safety situation at the mine, I am informed that my colleague the Minister for Aboriginal Affairs has already been in touch with the appropriate Queensland Minister and is awaiting a reply. Senator HAMER —Is the Minister representing the Prime Minister aware that the foreign affairs and defence committee of the Victorian branch of the Australian Labor Party passed a motion on Sunday claiming that the Caucus decision on uranium has no standing? Is he further aware that this motion will be put before a special State conference on uranium to be held on the twenty-seventh of this month and that a prominent Labor Party member, Mr Bill Hartley, believes it will be accepted by that meeting? Does Senator Button agree with that part of the motion which claims that Caucus exceeded its powers in interpreting the Party platform on uranium? If the motion is passed, what effect will it have on the Government's uranium decision of last week? Senator BUTTON —I try to keep abreast of all the important events which take place in this country but I was not aware of the decision of the foreign affairs and defence committee of the Victorian branch of the Labor Party. I take Senator Hamer's word for it that such a decision was made in relation to the Caucus decision of a little over a week ago. Of course it is common knowledge that there is a difference of opinion within the Australian Labor Party about the platform in relation to uranium mining which was arrived at at the 1982 conference of the Party. I am quite aware that that matter will be debated at a conference of the Victorian branch of the Australian Labor Party, I think on 27 November, as Senator Hamer again informed me. I believe I will have the dubious honour of attending that conference and I look forward to that. As to the suggestion that Caucus might have exceeded its powers, that is an interpretation with which I do not agree. I made that clear in answers to questions in this chamber last week. Senator PRIMMER —My question is directed to the Minister representing the Minister for Foreign Affairs. How many Australian high commissioners receive their salaries without pay as you earn tax deductions? How many other Department of Foreign Affairs staff receive their salaries without PAYE tax deductions? If any, has approval been given to each of these cases by the Australian Commissioner of Taxation and what was the date of each such approval? Senator GARETH EVANS —Mr President, Senator Primmer should be well aware that matters of this kind are matters between-I was going to say the taxpayers and their makers-but certainly between the taxpayers and the Commissioner of Taxation, who does not occupy quite such an exalted position. Answers to similar questions in the past, when retailed to the Commissioner of Taxation, have invariably elicited the response that no such information will be forthcoming as to the individual taxpayer's arrangements. I imagine that a similar response can be anticipated in this instance, but to the extent that there is anything which can be put on the public record consistent with that tradition I will refer the matter to the Minister for Foreign Affairs. Sentor ARCHER-My question is directed to the Attorney-General. With the increasing lawlessness being exhibited by disruptionist and subversive groups in recent demonstrations around Australia, can the Attorney advise what action the Government has decided to take and/or what legislation it has decided to introduce as would be appropriate to safeguard the progress, development and security of the nation? Senator GARETH EVANS —If there is any necessity for legislation in this country in the areas to which Senator Archer refers, it is undoubtedly to counter some of the very extravagant human rights invading legislation generated by generations, in turn, of conservative governments that have been profoundly indifferent to the basic human rights of freedom of speech and freedom of protest. Of course there must be a legitimate regulatory framework within which that protest can occur. It is all too much to be regretted that in many parts of Australia there has been a profound indifference to the necessity to balance that regulatory framework with appropriate protections for the rights of the individuals concerned. I have no intention whatsoever of embarking on the kinds of adventures that Senator Archer encourages me to. I believe that, to the extent that a law-making job needs to be done, it is one that needs to operate wholly in the contrary direction. Senator MISSEN —My question, which is addressed to the Minister representing the Minister for Home Affairs and Environment, relates to the announcement by the Victorian Government that it is to drop all financial aid to the Australian Ballet and the Australian Opera for their 1984 seasons and to cut its grant to the Australian Dance Theatre from $260,000 to $130,000 during the coming year. In the light of this sudden and drastic action by the Cain Labor Government and the longstanding poor deal which opera subscribers have received in Victoria, I ask the Minister: Firstly, what steps will be taken by the Federal Government to offset the severe financial problems that these cuts will place upon planned performances by the Australian Opera, the Australian Ballet and the Australian Dance Theatre within Victoria; and, secondly, will he assure the Senate that the Commonwealth Government will act promptly to ensure that the citizens of Victoria are not denied access to the high quality performances currently offered by these groups? Senator RYAN —I will have to refer the detailed matter of the honourable senator' s question concerning the Victorian Government's reduction of funds for the Australian Opera to my colleague the Minister for Home Affairs and Environment, Mr Cohen. I point out to Senator Missen, as he has requested direct Federal Government action in this matter, both with regard to the particular company that has had its funding reduced by a State government decision and in general in terms of access by Victorians to the performances of this company, that it appears to be the view of his Party-indeed it is of ours-that funding decisions of the Australia Council should be independent and should be made without political interference. Indeed, during the consideration of the Estimates by the Committee of the Whole in this chamber last week, I was treated to quite a lecture from Senator Martin to the effect that all decisions concerning funding of performing arts companies throughout Australia should be decisions made independently by the boards of the Australia Council and by the Australia Council and that even any suggestion by a Minister of overall policy objectives of the Australia Council was something that she at least questioned. In the light of that, and given that I agree with Senator Martin and with the Liberal Party that decisions about the funding of individual companies are decisions for the Australia Council to make, I very much doubt that there will be direct Federal Government action with regard to this company. However, I point out that because our Government believes in the independence of the Australia Council we have transferred the decision-making power of this company concerning opera and ballet from what it was under the Fraser Government-that is , a Cabinet decision-to the Australia Council. The Australia Council, of course, has much more funding at its disposal to assist companies such as the Victorian opera company. I can only express the hope, if Senator Martin will not regard this as a dreadful interference in the business of the Australia Council, that decisions are made by the Australia Council so that the Victorians are not denied access to the benefits of such performances. Senator MISSEN —Mr President, I ask a supplementary question. Do I take it from the answer that the Minister regards a decision to increase the amount of funding to overcome a deficiency caused by a State government as an interference with those particular bodies? Senator RYAN —I am suggesting that that interpretation may well be put on it by other members of the Opposition, although obviously not by Senator Missen. What I am saying is that any decision taken to increase Federal funding to that company to help it overcome the problems of suffering a loss in its State grant will be a decision of the Australia Council, but I will convey the honourable senator's concerns to the Minister. Senator FOREMAN —My question is directed to the Minister representing the Minister for Housing and Construction. The Government's new first home owners scheme has been operating now for six weeks. Can the Minister state what impact it is having on the housing industry, particularly in South Australia? Senator GRIMES —I thank Senator Foreman for the question. I will seek to answer it for him. Mr President, as you know, when this Government came to office in March it was confronted with a situation in which the housing industry was operating well below capacity, in fact, at a record low capacity. For various reasons, many potential home buyers were unable to afford the interest rates being charged on housing loans and could not enter into home purchase. One of the first actions the Government took was to review the housing policies and the programs which were in place at that time. As a result of that review we introduced a number of specific measures not only to aid the housing industry but also to generate jobs and to assist those wishing to obtain their first home . A key to this package, as Senator Foreman has said, which was first announced in the May economic statement, is the first home owners scheme which commenced on 1 October last. In the first six weeks of operation over 10,000 applications were received. Senator Foreman may be interested to know that 1,000 applications have been received in South Australia. As well as the 10,000 or so applications there have been over 140,000 inquiries and Department of Housing and Construction offices are being inundated by requests for application forms. The new first home owners scheme was designed to assist low and moderate income earners not only to obtain extra housing finance but also to reduce the repayment burden. The Government also took action to look after those who are unable to afford housing in the private market. We provided $500m for public housing compared with the $330m which was provided by the previous Government. South Australia received about $62m of this amount. Apart from these well targeted and efficient programs, the most effective action the Government has taken to assist home owners and the housing industry has been to create the environment for a reduction in interest rates. Since last December interest rates have fallen by between 1.5 and 2 percentage points and this has reduced payments on a typical $35,000 loan from a bank or building society by between $ 40 and $50 a month. The signs indicate clearly that our strategy to get the industry moving again has worked. Dwelling commencements increased 5 per cent in the March quarter from the very low December quarter and a further 17 per cent in the June quarter . Private house approvals, a forward indicator of activity, were 35 per cent higher in the September quarter than in the corresponding period in 1982. Lending for housing has also shown a marked improvement. We have passed from the deep depression of last year in the housing industry and every indicator this year since this Government came to power has improved. Because of the high employment multiplier effects in the housing industry and in house building activity, the benefits of this recovery will spread throughout the community, and this is particularly good news to the white-goods industry in South Australia in which Senator Foreman is so interested. Senator Chaney —Mr President, can we have the paper from which the Minister quoted? Senator GRIMES —Sure. I did not quote from it; I read it. Senator WATSON —I address my question to the Minister representing the Minister for Health. In view of Senator Grimes's remarks that stage 2 of the Launceston General Hospital must be built and that the Commonwealth will have to share the cost, will the Commonwealth Government fulfil its commitment to cost-share the building of a modified stage 2 of the hospital without this funding affecting the level of support to other Tasmanian hospitals? Senator GRIMES —I have made remarks in recent weeks and recent years on the desirability of completing stage 2 of the Launceston General Hospital and I have been consistent in what I have said. The previous Government, which was in power from 1975 to 1983, never once made a commitment to the completion of stage 2 of that hospital; nor did it ever make a commitment to put one cent into that hospital. The previous Government, despite requests of previous Labor and Liberal governments in Tasmania for the previous Government to make a commitment and despite the representations made by Mr Newman, a Minister of the previous Government who lives in Launceston, never ever made that commitment. The difficulty has been that the Launceston General Hospital has been in this state of uncertainty. I agree with Senator Watson that this state of uncertainty must stop. What we need to do, in my opinion, is complete stage 2 of that hospital, in a modified form or otherwise, and end up with a reasonable hospital. The best way to plan this is to look at the whole question of hospital bed needs in north- eastern Tasmania and come up with a rational hospital program for that area. That is what this Government wants to do, in combination with the State Government. We have put to the Tasmanian Government a proposal for looking at the situation in northern Tasmanian hospitals, but we are unwilling to commit funds without some idea from the Tasmanian Government as to just what its plans are and what its concepts should be. If Senator Watson really believes that we can proceed in Tasmania by building new hospitals, putting in new beds and not taking into account the need for hospital beds in other places, I believe that he is mistaken and I do not think he believes that that is a reasonable approach . Senator REYNOLDS —Is the Minister representing the Minister for Communications aware of some strong resistance among country people to the introduction of Telecom Australia's countrywide calling system? Does the new system disadvantage country people by increasing the cost of local calls? Can the Minister recommend a review of the new system to ensure that isolated Australians are not discriminated against in regard to communications costs? Senator BUTTON —Senator Reynolds was good enough to give me notice of this question and I have obtained an answer from the Minister for Communications. I am advised that countrywide calling was developed to overcome problems associated with the provision of services in sparsely settled areas. The main concern in its development centred around the need for several things: Firstly, the need for larger zones to limit expenditure on zone identification equipment; secondly, to provide customers with access to a reasonable number of people at lower call charges; thirdly, to keep community access arrangements intact. Countrywide calling benefits the majority of customers, as stated by the Minister for Communications and Telecom, by extending the area over which people can call at a reasonable rate and by enabling automatic telephone services to be provided in remote areas earlier and at less cost than under the existing zoning scheme. It is understood that Telecom has received a large number of representations, perhaps complaints, from country people about countrywide calling. Clearly there is a degree of concern amongst country people about the new system. In response to these representations, I can say that the manager of trunk network services, a senior Telecom officer, has been involved in extensive consultation with country people about their concerns. He has already travelled to Goondiwindi, to the Wentworth area of New South Wales, and to Wilpena and Ceduna in South Australia, and he will go to Queensland in the next few days. Inevitably, introduction of the system has thrown up anomalies, and it is these anomalies which are being ironed out by Telecom at the moment. Wherever the manager has been, he has been able to make changes to cater for the people concerned. It should be understood that the system will enable country people to telephone a lot more people at less cost, although this has necessitated a number of local calls being charged on a timed three-minute basis. Clearly there are trade-offs in the new scheme, but the overall benefit is that it will allow much wider access at less cost to country subscribers. The matter is being continually examined by Telecom, in terms of the earlier answer I gave. Senator LEWIS —I ask the Leader of the Government in the Senate a question about the Government's call to all parties in the construction industry 'to explore all avenues' to circumvent the decision of the Australian Conciliation and Arbitration Commission. Is this not proof that the Government is more concerned about industrial peace than economic recovery and jobs? Senator BUTTON —There is no proposal for consultation to circumvent the decision of the Conciliation and Arbitration Commission. 'Circumvent' was the honourable senator's word and nobody else's. Senator Lewis —I quoted the words 'to explore all avenues' too. Senator BUTTON —The honourable senator used the word 'circumvent'. I am just making it quite clear that I am not answering a question about circumvention of the Commission's decision. The decision given by the Arbitration Commission in relation to the building trades agreement has necessitated a further process of conferences with the building industry and the building trades unions. The Government will take part in this. Senator Dame Margaret Guilfoyle —What about the employers? Senator BUTTON —The employers do not accept it either. That necessitates a further process of conferring. The Government made it quite clear to the Conciliation and Arbitration Commission that, if there was to be an acceptance of the building industry agreement, it would be on the basis that it would not flow to other industries. The Arbitration Commission expressed the view that in its opinion it could not be contained. It is in respect of those matters that further conferences will take place. Senator Lewis then asked me the extraordinary question as to whether this Government prefers industrial peace to economic growth. He wasted the last eight years in the Senate trying to point out to everybody else that the two things were intimately connected. Senator Lewis —You are in government; we are not. Senator BUTTON —We are in government; that is right. Senator Lewis should not let it hurt him too much or pain him too much. We are in government and that is why I said earlier that the process of consultation on this matter will continue . If there had been a Liberal government, I do not know what would have happened . I would be grateful for some suggestion. Perhaps Senator Lewis could bring forward a matter of public importance on the subject and tell us what he would have done in the circumstances. But the realities of the situation are that industrial relations in the building trades are very difficult. The decision of the Arbitration Commission does not resolve that problem and the Government will take part in consultations to try to find a solution to that problem. I was trying, when Senator Lewis became irritated by something I was saying, to say that of course the questions of industrial peace and economic growth are intimately related. This Government has been concerned right from the date of its election to see that the detriment to economic growth which was caused by so much industrial relations confrontation and trouble in the time of the Fraser Government-when people like Senator Lewis day after day, week after week, year after year blamed the industrial relations system for the chronic failures of the Fraser Government-does not happen again. Senator Lewis —Give them anything they want. Senator BUTTON —It is not a question of giving them anything they want. I will give Senator Lewis what he needs. It is a matter of recognising the very close relationship between the two matters which Senator Lewis puts in juxtaposition in opposition to each other. Senator COLSTON —Is the Minister for Education and Youth Affairs able to report on the progress of planning to introduce a school of tropical medicine at James Cook University? Can the Minister confirm that this project will receive priority consideration, despite some apparent resistance within the Tertiary Education Commission to the development of this important research facility which is vital for the study of tropical diseases and Aboriginal health in northern Australia? Senator RYAN —As I announced on 28 July 1983 in the guidelines to the Tertiary Education Commission, the question of establishing such an institute is to be considered by the Commission in the context of the 1985-1987 triennium and advice will be included in the Commission's triennium report early in 1984. I would not wish to pre-empt the Commission's advice or the Government's consideration of that advice. I understand that the Universities Council of the Commission currently has this matter under consideration and as a part of this process is consulting with the Commonwealth Department of Health which also has responsibility for research in this area. I expect that this project will receive positive and constructive consideration by the Tertiary Education Commission and its bodies and it will be the subject of a Government decision after that advice is received. Senator MESSNER —My question is addressed to the Minister for Social Security. I refer to the question I asked him on 2 November concerning a report of an alleged fraud of $10,000 from his Department about which the Minister used his discretion to suppress prosecution of the alleged offender. As the Minister indicated that he would check the facts and provide further details, I ask whether he is now in a position to do so. Senator GRIMES —Yes, I have checked the situation. I intended, in fact, to answer Senator Messner after Question Time this week. First of all, the fact is that there was a case involving a fraud of some $5,000, not $10,000. The case was recommended for prosecution. After representations were made to me by Mr Fry, the honourable member for Fraser, and after consideration of the facts and consultation with officers of my Department, I decided that that prosecution would not proceed although it is my understanding, certainly, that the restitution of the overpayments will proceed. The reasons for that decision were to do with the circumstances of the person involved. I thought that, as I had that discretion, in that situation it should be made. I point out to Senator Messner that that discretion has been available. It is my understanding that Senator Chaney made a statement saying that he had never used it. I expect that I would not use it very often. But that does not mean that it should never be used. I have had representations made to me from people on both sides of the Parliament about cases like this. I remember some years ago that I made many representations to the then Minister for Social Security about what I considered was an extremely unfortunate case of a person who was being prosecuted in circumstances not unlike this. The Minister refused to take any action in the case. When the case got to court, the magistrate discharged it and roundly condemned the authorities, the Government and the Department for ever letting the case go to court. So I suggest that, in those circumstances, there is some suggestion that that ministerial discretion is, at times, necessary. I am unwilling, unless asked to do so by a substantive motion of this House, to name the person involved or to discuss the personal circumstances involved. I do not believe that that would be proper. I do not believe that that is a sensible thing for a Minister for Social Security to do in this place. Senator MESSNER —I ask a supplementary question, Mr President. I thank the Minister for his answer. I think I understood him to say that he did not see any bar to the seeking by the Department of restitution of funds but that he would not be proceeding to prosecute the client. As I understand it, he was also making the point that there was considerable hardship involved in the case that he mentioned. Therefore, I fail to see how he is alleviating hardship by instituting a course of restitution. I wonder, therefore, whether the Minister might give us an outline of his general reasons for taking the particular decision. Senator GRIMES —I accept the point made by Senator Messner. Restitution was already being made when it was decided to prosecute. Restitution, as Senator Messner knows, can be made in very small amounts. But that was not the primary cause of my making the decision that I made. In considering this case I considered, firstly, the amount of money involved and, secondly, the personal circumstances of the lady involved, how many children she had, how young those children were, what the likely outcome of the penalty would be and the hardships involved in the penalty, and whether the hardships involved in such a penalty would be worse than the situation she found herself in when receiving that overpayment. It was due to a whole range of facts like that that the decision was made. I repeat to Senator Messner that I expect that it would be unlikely that I would make such a decision again or many such decisions again, but I think occasionally one has to do so. Senator BUTTON —During Question Time earlier today Senator Chaney asked me a question about information given to the Northern Territory Government in relation to the Uluru National Park and the decision announced by the Government on 11 November in relation to that matter. I am advised that a telex was sent on the morning of 11 November to Mr Everingham, the Chief Minister of the Northern Territory, and an announcement was made regarding the Commonwealth's intentions later that day. I make the point that the Commonwealth's position and intentions in relation to that National Park were not by any means new to the Northern Territory Government and the matter had been the subject of public statement and discussion. In fact, on 3 June this year the Northern Territory Chief Minister wrote to the Commonwealth Government seeking the transfer of that park area to the Northern Territory with a view, as the Chief Minister put it, to granting to the Aboriginal people perpetual title in the land at that park under Northern Territory law. The matter has been the subject of ongoing consideration. But insofar as the question was directed to the specific facts of what happened on 11 November, I provided them in an earlier part of this answer. Senator GARETH EVANS —During Question Time Senator Hearn asked me about the replacement of B52D aircraft stationed at Guam with B52G aircraft and asked what was happening in relation to their flying over and touching down in Australia. I am now able to give her the following answer: I can confirm that B52G aircraft have visited Australia. I am advised that the B52 aircraft passing through Australian air space or landing at Darwin are involved exclusively in training and ocean surveillance activities and are not armed. Any change in this situation would require the prior agreement of the Australian Government. In that respect the answer is no different from that which has traditionally and accurately been given in relation to the previous class of B52 aircraft. Senator GRIMES(Tasmania-Minister for Social Security) —Papers are tabled in accordance with the list circulated to honourable senators. I seek leave of the Senate to have the list incorporated in Hansard. Leave granted. The list read as follows: 1. Review for the Australian Trade Commissioner Service-Report-together with the text of a Statement by the Minister for Trade relating to the report. 2. ACT Bush Fire Council-Annual Report 1982-83. 3. ACT Fire Brigade-Annual Report 1982-83. 4. ACT Registrar of Co-Operative Societies-Annual Report 1981-82. 5. Canberra Commercial Development Authority-Annual Report 1981-82. Report and Ministerial Statement Senator ARCHER(Tasmania)(3.12) —I move: That the Senate take note of the paper. I welcome the report on the Australian Trade Commissioner Service that has been put down. I am pleased that the Minister for Trade (Mr Lionel Bowen) took the action he did in having this inquiry carried out. I do hope, however, that it is not just another inquiry and not just another report. I express the great respect that I have for the excellent gentleman who carried out the inquiry, but I do regard their findings and considerations both tentative and timid. I believe they could have taken a much more forward thinking approach to the matter at this time. One of the few things that all sectors of government and business agree on at present is that an increase in our exports and our export attacks is most necessary for the Australian economy to revive. I have to doubt that the actions proposed will produce more than a ripple when in fact a major splash is required. The Australian Trade Commissioner Service has been looked at very regularly. Various committees of the House of Representatives have looked at various sections of it. The Senate Standing Committee on Trade and Commerce, of which I was a member at the time, also made a parliamentary investigation into it and made recommendations. Each year there is a report on it in the report of the Department of Trade. Every second year the Department makes its own inquiry into its own operations. So it cannot be said that we have not had a good and fairly regular look at the Trade Commissioner Service. But what can be said can be instanced by the fact that the report of the Trade and Commerce Committee of 1978 and this report which has just come out are remarkably similar. The same recommendations are being made now as were made five years ago. I believe that if we are to achieve something in the operation of the Trade Commissioner Service it will need to be far more aggressive than it has been in the past. It will need to be much more flexible. I am pleased to see in the Minister's tabling statement that he refers to the increased flexibility that he hopes to be able to achieve. I also believe it is necessary to have a much clearer definition of the services that the Trade Commissioner Service provides. Everybody I know seems to expect different things of the Service. Each person sees it as performing different functions. I believe that too much is expected of the Service by many people. The definition of what the Service is there for needs to be clarified. One of the worst areas of the Australian trade scene is the degree of competition which exists, apparently, between the Australian Trade Commissioner Service-administered by the Department of Trade-and the States. I believe that somehow or other greater co-operation has to be achieved with the States on the use of resources in our overseas posts. The Australian Trade Commissioner Service and the facilities provided have to be considered far more as part of the overall productive policy of this country, especially when it comes to matters such as taxation incentives, the Australian Industry Development Corporation and so on. The Government has to go much further than the statement of the Minister for Trade if real export growth development is to be achieved. Question resolved in the affirmative. Annual Report 1982-83 Senator REID(Australian Capital Territory)(3.16) —I move: That the Senate take note of the paper. Last year was one of the worst bushfire seasons in Canberra. It was very dry. A bushfire in the Gudgenby Nature Reserve burnt for nearly a month. This year we have had more rain than in the last seven years. Growth around Canberra is extremely high and extremely hazardous. The allocation of funds to the Australian Capital Territory Bush Fire Council in the Budget for this year was cut by some 52 per cent from $1,907,000 to $907,000. When I raised this matter during discussion on the Estimates it was suggested that last year was an unusual year. I hope that this year will not prove to be another unusual year. The amount of grass near and in the area that is looked after by the Bush Fire Council is such that I hope additional funds, if necessary, will be readily available. I hope that personnel will be readily available to take action if grass fires start. I would like the Minister for Territories and Local Government (Mr Uren) to give attention to this matter at the present time. Question resolved in the affirmative. Annual Report 1982-83 Senator REID(Australian Capital Territory)(3.18) —I move: That the Senate take note of the paper. The amount allocated to the Australian Capital Territory Fire Brigade this year has not been reduced by as much as it was last year. The increase is 10 per cent . As honourable senators will be aware, that is slightly less than the inflation rate so, in real terms, it is a reduction. Last year the Fire Brigade attended 560 grass and bush fires in a year when I think most people would have thought that there really was no grass around Canberra to burn. This year in suburban areas quite near houses there are fields in which the grass is more than one metre high. In relation to the suburb of Narrabundah, I have written to the Minister for Territories and Local Government (Mr Uren) drawing his attention to extremely high grass on vacant lots near weatherboard houses which are on quite small housing allotments. I hope that the Fire Brigade will not be involved in more than 560 grass and bush fires in Canberra this year. This matter needs urgent attention. Certainly the cutting of grass is proceeding, probably as quickly as it can in view of the type of weather we are experiencing at the moment. But the cut grass is being left to lie and is drying off as straw. I think it is still a severe fire hazard. I suggest that consideration be given to allocating some of the community employment program funds to employ people to give attention to this matter. Surely it comes into the category of prevention being better than cure. Question resolved in the affirmative. Senator WATSON(Tasmania)(3.20) —I move: That the Senate take note of the paper. The seventh annual report, for 1981-82, of the Canberra Commercial Development Authority raises more questions than it answers. The working capital deficit and current liabilities of $8,653,318 exceed current assets of $6,318,305. One must therefore ask how the Authority plans to meet its future commitments in these circumstances and to remain solvent. Looking at the long term liabilities and the fact that many of these debts are likely to mature shortly, one must ask what are the means of repaying the debt capital. To me it appears that the only avenue is to continue to go to the market and to borrow. On 5 April 1973 the then Minister for the Capital Territory, the Hon. Kep Enderby, said that the Belconnen Mall was an exciting proposal, that it provided the best possible range of facilities, that it was an attractive and competitive centre, and that it would-here are the operative words-help to reduce pressure on prices. To date there has been no evidence, and certainly no explanation has been given, as to how the Belconnen Town Centre has achieved a reduction of pressure on prices to the tenants, the customers or consumers, despite that statement. Later, looking at section 26 of the Ordinance under which the Authority was set up, we find that it was to promote the payment to the Commonwealth of Australia of a reasonable return on the capital of the Authority. So I think we need to ask whether the Minister for Territories and Local Government (Mr Uren) believes that the Mall development is still soundly financed. When does the Commonwealth expect the first return from such an investment? Looking at the position in relation to the carry-forward of losses and the fact that no tax will be paid, one finds that there is not very much return to the Government in the form of taxes paid as compared with what might have been paid by a similar operation under private enterprise operating very much more efficiently and paying tax. On the basis of the cost of the assets versus the external equities, there is only a very minimal surplus, despite certain profits being earned over the period since the Mall became operative. It is true that after the revaluation of the assets, the investment on a book face looks very much sounder, but if there were a forced sale one wonders what the realisable price would be and whether the Commonwealth might have to be called upon to honour some of the debts it has backed. I think that more people than just the Minister should be informed as to the reasons for the delay in the report. The report states that the reasons for the delay have been given to the Minister. That is not good enough. All too often statutory authorities hide behind legal restrictions and so on, and in this case the Authority certainly has done that. What were the reasons? The report states that it was a very difficult trading period. There is no directors' or chairman' s report to accompany the figures, as would be required in private enterprise. It just shows the paucity of the Government's reporting requirements and the fact that many such authorities, including the Commercial Development Authority, hide behind providing a minimum of information concerning disclosures. Basically the investment here is made very much more attractive by the impact of inflation rather than of sound financing techniques. In spite of the fact that Mr Pead as Chairman sent the report to the Minister for Territories and Local Government in August 1983 and that Mr Pead as Chairman and Mr Elsworth as Deputy Chairman signed the accounts on 16 August 1983, they are still prepared to make this comment in the report: The future income tax benefits arising from timing differences and past tax losses as detailed in notes C and D below have not been recognised because their eventual recovery out of future taxable income cannot be assured beyond any reasonable doubt. Is not this an indictment by the Chairman and the Deputy Chairman of the future profitability of this operation? Surely they should have a bit more confidence than to make such a statement knowing full well that earlier the Government in its election promises and later had indicated that the Belconnen Mall centre was not to be sold. The DEPUTY PRESIDENT —Order! The honourable senator's time has expired. Senator Dame MARGARET GUILFOYLE(Victoria)(3.26) —I rise to make some comments additional to those made by Senator Watson with regard to the report of the Canberra Commercial Development Authority. This Authority has been investigated by three parliamentary committees in the last 2 1/2 years. The Public Accounts Committee and the Senate Standing Committee on Finance and Government Operations have both suggested that none of the members of the Authority be reappointed and that no government should ever again give them similar responsibilities. I think that some of the things that have been said by Senator Watson would give us the reason behind the recommendations of the two committees to which I have referred . As I understand it, the Prime Minister (Mr Hawke) ignored these reports to endorse the reappointment by the Minister for Territories and Local Government ( Mr Uren) of Mr Jim Pead as Chairman of the Authority and Mr David Elsworth as the Deputy Chairman. This was reported in the Bulletin in June of this year. We can go back to the 1980-81 reports of the Auditor-General and the Finance and Government Operations Committee. They were made on the basis of the Authority's accounting procedures and found that the depreciation of the Mall buildings had not been written off in line with generally accepted accounting procedures, and that a provision of the Authority's ordinance requires that the financial statements should be in the form that is approved by the Minister for Finance. There have been continuing difficulties with regard to these matters. What is now presented to us is a report that is very delayed in its presentation to the Parliament and, as has just been said, reasons for the delay have been expressed to the Minister. But I believe that the Senate, in line with its usual interest in the reports of statutory authorities, would also like to hear some of the reasons for the delay in the presentation of the report. If we go right back to 1977-78 we see that the Auditor-General made criticisms and had difficulties with regard to the following: The signatory of the accounts; such things as the investments of the Authority in bank bills; the payment of salaries and allowances without the statutory approval of the Public Service Board as required by section 17 (2) of the ordinance; and the payment of underwriting fees for an over-subscribed amount of $2.75m on a $10m public loan, contrary to the usual commercial practice. This ought to have been dealt with under section 16 of the Authority's ordinance. In 1982 interest was expressed in the Authority by the Finance and Government Operations Committee. It expressed concern about the Authority flouting the law by employing staff and paying it without Public Service Board approval and presenting accounts not properly disclosing provisions for income tax. It also expressed concern that the Authority overdrew its bank account in breach of the ordinance under which it operated. Part of the investigation by the Public Accounts Committee dealt with the Auditor-General's earlier finding. It was noted that the Authority agreed to wage arrangements with employees, some of which could have been construed as being in direct conflict with section 26E of the Taxation Act. The Authority supplied Treasury with misleading information and it was claimed that the Chairman of the Authority tried to mislead the Public Accounts Committee. As I understand it, the Authority paid a total of $41,000 to Mangaroo Pty Ltd which was owned by David Elsworth, the Deputy Chairman of the Authority. Although the Public Accounts Committee found no impropriety attached to the use of Mangaroo by the Authority, it did state that it felt that there were strong ethical reasons against Mr Elsworth's remaining as Deputy Chairman while he was simultaneously providing consultancy services to the Authority on behalf of Mangaroo. All of these matters are before us as we look at this report. I remind the Senate of Senator Reid's notice of motion to disallow the ordinance. Its purpose was to extend the operations of the Authority to include the Erindale project. I think we have to ask whether, in light of the Authority's past record , an extension of its ordinance is one that ought to be endorsed or whether we should deal with the matter in greater detail when the disallowance motion comes before the Senate. Question resolved in the affirmative. Senator SIBRAA(New South Wales) —I table further additional information received by Estimates Committee E and seek leave for it to be incorporated in the Hansard record of the Committee's proceedings. Leave granted. Senator GEORGES(Queensland) —I table further additional information received by Estimtes Committee F and seek leave for it to be incorporated in the Hansard record of the Committee's proceedings. Leave granted. Sentor WATSON (Tasmania)-I present the 212th report of the Joint Parliamentary Committee of Public Accounts and a Department of Finance minute on the Committee 's 203rd report on medical fraud and overservicing. Ordered that the report be printed. Senator WATSON —by leave-The 212th report of the Joint Parliamentary Committee of Public Accounts contains the Department of Finance minute on the Committee's earlier report No. 203-a progress report on medical fraud and overservicing. The Department of Finance minute is the formal mechanism used by the Government for responding to the Committee's recommendations. The Committee's progress report on medical fraud and overservicing was tabled in Parliament on 9 December. It contained 45 recommendations directed at streamlining and strengthening both administrative procedures and existing legislation. The report examined the effectiveness of existing legislation, procedures for dealing with abuse of the medical benefits system and a generalised discussion on other associated problems. The 203rd report raised a number of fundamental issues on public administration which extended well beyond the specific area of medical fraud and overservicing. These included the overall performance of the Department of Health, the general relationship between central and State offices of departments and the adequacy of the current legal system in coping with white collar crime. While the Committee notes the considerable progress made to combat fraud and overservicing, it believes that there are still significant areas where further improvements need to be made. For example, it appears that the Department of Health has more than doubled its positions dedicated to reducing medical fraud and overservicing from 94, as at June 1982, to 205 as at October 1983. However in the crucial area of staff devoted to development of the Department's fraud and overservicing detection system there has been to date no increase in the number of people permanently filling positions, although the number of positions has increased from seven to 16. Similarly, the Australian Federal Police has applied to the Public Service Board for an extra 50 positions to be dedicated to medical fraud and overservicing. This is in addition to a request for another 149 general positions in 1982-83 and 230 positions in 1983-84. The Committee will be monitoring the Board's consideration of these positions. Furthermore, while the Attorney-General's Department has created an additional 12 positions to deal with medical fraud and overservicing-a move welcomed by the Committee-at present only three of these have been filled by permanent promotees; the rest are filled by personnel on an acting basis or on temporary transfer. The Committee considers that most senior officers in the Department of Health, the Australian Federal Police and the Attorney-General's Department now acknowledge the complexity and magnitude of the effort required to deal with medical fraud and overservicing in the Australian community. The Committee therefore welcomes the establishment of: The Surveillance and Investigation Division in the Department of Health; and a central co-ordinating committee and State co-ordinating groups containing representatives of the Department of Health, the Attorney-General's Department, the Australian Federal Police and the Department of Veterans' Affairs. It is clear that the development of the fraud and overservicing detection system-FODS-is of paramount importance to the success of efforts to combat medical fraud and overservicing. The Committee is not convinced that adequate resources are currently being devoted to this task. At present the 14 main FODS development activities of the Department of Health may take up to 230 man months to complete. The Committee noted with interest the National Prosecutors Seminar conducted by the Attorney-General's Department in April 1983. The Committee believes it is necessary for such a seminar to be held regularly in order to update and share knowledge of prosecution information among relevant Commonwealth officers. The Committee has been informed that 37 medical practitioner disqualification actions were in progress as at 30 September 1983. A breakdown of the Central Co- ordinating Committee's caseload as a September 1983 reveals: A substantial overall increase in medifraud cases-502 in total; higher medifraud caseloads in New South Wales and Victoria relative to other States; and a considerable backlog of cases, listed more than six months ago, awaiting action in the Department of Health. I turn to the Medicare national health scheme. It should be emphasised that the Committee cannot and does not question the adequacy of government policies but is concerned with their administrative implementation. During discussions with the Minister for Health (Dr Blewett), the Committee was informed that the current departmental estimate of the cost of fraud and overservicing by doctors is in the vicinity of $120m per annum. It is noted that at least one professional medical society believes this estimate should be closer to $200m per annum. The Committee believes that resources in the Department of Health currently devoted to investigation and prevention of medical fraud and overservicing should not be diverted to aid the introduction of Medicare. Efforts to control and reduce medical fraud and overservicing are a necessary complement to the introduction and successful operation of the Medicare scheme. The Committee is pleased to see legislation being introduced to implement many of its recommendations. However, it notes with concern that the Department of Health has not made significant progress in implementing the new overservicing committee system referred to in the Department of Finance minute. The Public Accounts Committee acknowledges that extensive new legislation may be required to implement a new overservicing committee system but believes such legislation will be vital to the containment of medical benefit costs under the Medicare scheme. The Committee notes that latest official estimates suggest a markedly higher supply of doctors in the coming years. It remains concerned that as mechanisms to control and reduce medical fraud become more effective, there will be an increase in the level of overservicing by medical practitioners. The Committee's inquiry into medical fraud and overservicing is continuing and I look forward to presenting the final report to Parliament next year. I commend this report to honourable senators. Senator SIBRAA(New South Wales)(3.38) —I move: That the Senate take note of the report. I seek leave to continue my remarks later. Leave granted; debate adjourned. Postponement of Notices of Motion Motion (by Senator Reid) agreed to: That Business of the Senate, Notice of Motion No. 1, standing in my name for the disallowance of the Canberra Commercial Development Authority (Amendment) Ordinance and Business of the Senate, Notice of Motion No. 1 for Thursday, 17 November 1983, standing in my name for the disallowance of the Casino Control Ordinance, be postponed till Tuesday, 29 November 1983. Consideration resumed from 10 November 1983. GROUP E Department of Defence Proposed expenditure, $4,273,981,000. Senator WATSON(Tasmania)(3.40) —I ask the Attorney-General (Senator Gareth Evans) whether the Joint Committee of Public Accounts was misled when it inquiried into the cannibalisation of spare parts in relation to certain aircraft and was advised that this practice would be discontinued as a result of the increased allocation of moneys for the supply of spare parts, improved accounting procedures, improved communications system, et cetera. It was distressing to hear again this year that cannibalisation has been practised on a reasonably wide scale, particularly in the Royal Australian Air Force. Senator GARETH EVANS(Victoria-Attorney-General)(3.41) —The best way I can answer the honourable senator's question is as follows: There is no acceptance of the practice of cannibalisation as a routine source of repair parts. Temporary cannibalisation of parts from an aircraft undergoing long term maintenance or repair for use on another aircraft to meet a short term operational need is a common practice in other air forces, airlines and many large scale operators of complex equipment. To totally eliminate such cannibalisation would require prohibitive investment in spares support. Temporary cannibalisation is only adopted as a result of a specific management decision when the urgency of repair precludes any other arrangements. There has been a deliberate attempt to increase the proportion of expenditure devoted to capital equipment and to contain expenditure on maintenance support items, but there is no evidence that the incidence of cannibalisation in the RAAF is increasing. The need to cannibalise parts from one aircraft to maintain another can spring from a number of causes not necessarily restricted to the provision of funding for spare parts. For example, production or delivery delays , first time failures and engineering repair problems can also contribute to the need. I understand that that answer is consistent with what was stated to the Public Accounts Committee. There may be some differences of emphasis or interpretation involved, but that is as accurately as the Department and the Minister for Defence (Mr Scholes) can relay the present state of affairs. While I am on my feet, I take the opportunity to reply to a number of matters that were raised by Senator Watson and Senator Sir John Carrick during the consideration of the estimates for the Department of Defence on 10 November, last week. The first matter, the taxation of earnings of Rerserve personnel, was raised by Senator Watson and was adverted to by Senator Sir John Carrick. The Treasurer (Mr Keating) and the Minister for Defence announced on 9 November that half of the earnings of reservists would be free of tax. It therefore follows that the rate of tax on total Reserve pay will be a maximum of 30 per cent, but even lower for those in lower income brackets. No tax will be deducted in respect of any earnings before 1 December 1983, whether or not the amount is paid after that date. As I mentioned last week, the decision is generous by comparison with what others pay in tax on their extra marginal income. In March 1975 the Committee of Reference for Defence Force Pay concluded that there was a difference in skill efficiency and professionalism between the regular soldier and part time reservist and the pay rates should be different as between those categories. In August 1982 the Committee last quantified the difference at 90 per cent of Regular Force rates for officers up to the rank of major and its equivalent and 85 per cent above the rank of major and its equivalent. On the question of the actual pay rates, the Committee has been asked to review rates of Reserve pay and allowances in the light of the Government's decision and to report no later than 30 June 1984. If possible, the Committee will no doubt report before then. Senator Watson referred also in this context to a tax free sum for regulars who re-engage. This re-engagement bounty will be phased out from 26 September 1984 except for some regulars who joined the Defence Force as apprentices. There is no intention to review policy on the bounty. Senator Watson also raised questions about Army Reserve training, morale and severances. During 1982-83 recruitment for the Army Reserve was more successful than expected, which resulted in numbers exceeding the authorised strength. In 1983-84 it is planned to retain the existing authorised strength of 30,000 members. It is also planned to reduce the average number of training days from 38.25 to 36, which was the allocation for Army Reserve training prior to the expansion two years ago. The figure of 36 days, as an average training per man per year, has been generally accepted by the senior officers of the Army Reserve as being a realistic figure without involving a reduction in functions or activities. Defence has no evidence to support either any general lowering of morale or a 40 per cent severance rate, although no doubt there are individual instances, about which the honourable senator has information and can cite, of dissatisfaction with the state of affairs. A further question raised by Senator Watson concerned staffing in the Defence Science and Technology Organisation. There is a need, which was recently highlighted by the reviews of DSTO, to provide its scientists and engineers with more support through additional equipment and operating resources. Within a tightly constrained defence budget DSTO manpower is, therefore, being reduced by a net 80 in 1983-84 in a total of about 4,500. The manpower resources thus saved are being traded for an increase in operating and equipment support. Reductions are being directed to those areas of activity which are least supportive of the Organisation's service customers. Reductions are intended to be achieved by selective non-replacement of natural wastage. There will be no retrenchments in that area. As to the balance between civilian and military costs, a matter which was also raised by Senator Watson, the main reason for the civilian increase is the provision of $3.811m for redundancy payments to some 200 locally engaged civilians who have been retrenched as a consequence of the withdrawal of one Mirage squadron from Butterworth to Darwin in August 1983. There is no increase in civilian manpower numbers for the Department of Defence. To the contrary, the 1983-84 Budget provides for average civilian employment this year of 24,698 compared with 24,957 in 1982-83. Senator Watson also raised a question-I think it involved someone at Butterworth-concerning the promotion of a person from corporal to flight sergeant and the net pay involved. While the circumstances cited would not appear to be correct in the case of a flight sergeant, such an occurrence could apply in the case of a married corporal who was promoted to sergeant. This would be due to the effect of the higher salary on overseas allowance payments. It has been the Department's practice to take the Public Service Board's structured allowance systems and apply them to servicemen overseas, with a minor variation for servicemen's medical arrangements. In the light of the case of a corporal promoted to sergeant, it is intended to review this aspect of procedure for calculating overseas allowances. Senator Watson also adverted to communications support at the RAAF base at Butterworth. The answer to the issue he raised is this: No Reserve communications personnel are employed by the RAAF at Butterworth. However, some Reserve officers are regularly posted to Butterworth because it provides an opportunity for them to be employed in a way which allows them to exercise their specialist skills. Whether Senator Watson will be satisfied with that answer or whether he will regard it as a restatement of the question remains to be seen, but I am afraid that I cannot do any better than that for him. The question of Mirage aircraft also attracted Senator Watson's enthusiastic attention. A further and, I hope, better answer is as follows: The application of modern aircraft technology can allow the operations of aircraft to be regulated so that the effects of structural fatigue can be kept within safe margins. This technology has been applied to the Mirage and has resulted in the imposition of temporary flight restrictions on some aircraft and periodic inspection of fatigue prone areas. To return the Mirage to unrestricted operations and to further ensure the aircraft's structural integrity, the RAAF has embarked on programs to: Firstly, refurbish fatigue-damaged wings; secondly, procure new wings to replace the most fatigue-damaged wings; thirdly, inspect and refurbish fatigue-critical regions in the fuselages of high life aircraft-I am fascinated with the description; it means aircraft which are many hours old- and, fourthly, in conjunction with the Aeronautical Research Laboratories, the Mirage manufacturer and the Swiss Government, conduct tests to determine the fatigue life of the Mirage subsequent to the refurbishment program. By such well established means are the airworthiness of the Mirage and the safety of pilots assured. Senator Watson was concerned also to find out the situation with respect to Skyhawk and Tracker aircraft. A review of Australian coastal surveillance is presently under way. This review is being conducted on behalf of Mr Beazley in his capacity as Minister Assisting the Minister for Defence. The use of Tracker aircraft for coastal surveillance will be studied as part of this review. Four Skyhawk aircraft continue to be used for target towing in support of fleet training. These four aircraft are to be withdrawn from service in mid-1984 subject to the introduction of a suitable replacement target system. Senator Watson wanted some further particulars about the FA18 costs. I am able to oblige him as follows: The original project approval was expressed in August 1981 prices with an exchange rate of $A1 equalling $US1.1484. When project approval was last revised it was expressed in December 1982 prices and took into consideration the March 1983 devaluation. The exchange rate used was $A1 equals $US 0.8650. As announced by the Minister for Defence, this difference alone required an increase of $A777.638m to the project approval which assumed the continuation of the March 1983 exchange rate. However, the value of the Australian dollar has since increased in relation to the United States dollar and hopefully this trend will continue. As to Navy steaming and Army training times-a preoccupation of Senator Sir John Carrick-I am able to give him further and better particulars as follows: As to Navy steaming time, during 1981-82 and 1982-83, 86,048 and 84,049 tonnes of dieso fuel respectively were used by the Navy for fleet activities. For 1983-84 Navy has set the dieso fleet fuel allowance at 68,848 tonnes. Measures such as an increase in the number of fleet deployments together with single engine boiler running and reduced maximum speeds will help to reduce fuel usage and increase fuel efficiency. Actual usage of furnace fuel oil during 1981-82 and 1982-83 was 19,423 and 20,450 tonnes respectively. Planned usage for 1983-84 is 18,561 tonnes. Finally, as to Army track running, I am able to advise those senators who are still interested in these matters that Army will increase its M113 and tank training allowances by 10,000 and 1,000 kilometers respectively in 1983-84. I believe that this picks up all the various loose ends in relation to the Defence estimates that were left trailing at our last meeting. I hope that honourable senators will be duly satisfied. Senator TATE(Tasmania)(3.53) —I wish to follow up the question of the cannibalisation of aircraft. Estimates Committee E was concerned about an article in the Australian of 4 May 1983 which reported what had been said by the officer commanding Support Command, Air Vice- Marshal B. H. Collings. The article, amongst other things, stated: He said squadrons were managing to meet their targets by cannibalising parts from 'Christmas tree' aeroplanes, as well as by changing engines more often . . . That article went on to suggest that Air Vice- Marshal Collings had said that there was an inability of Support Command to meet many demands for spares from operational squadrons. That is, in my submission, a very serious charge. Senator Watson quite correctly inferred that if this practice is still continuing in a way which affects the operational efficiency of many squadrons or the demands from operational squadrons for spares, the Joint Committee of Public Accounts may well have been misled in the course of its inquiry as to the resolution of this problem. Indeed, Estimates Committee E came to the conclusion in the report before the Committee this afternoon that as the practice is alleged still to be occurring the Joint Committee of Public Accounts may wish to consider a follow- on inquiry. During the course of the Estimates Committee discussion of the matter, Mr Campbell, the Assistant Secretary, Supply Policy, of the Department of Defence stated: I am well aware of the article. I am not aware, though, of the circumstances which gave rise to it. I have no knowledge that this is by any means a common practice. He went on to say, amongst other things: There has been no major constraint on spares provisioning. There is therefore no reason caused by the means which have been imposed for there to be a substantial problem. There may be cases, he conceded, but in no way is this a common usage in the Air Force. Air Commmodore Bradford said in support of Air Vice- Marshal Collings: I am sure he would have had facts to back those statements up, particularly having done so publicly. So we have a difference of view between the Department of Defence and a serving officer in relation to the probable integrity or veracity of Air Vice-Marshal Collings in regard to statements which were reported in the Australian of 4 May 1983. In other words, we have to make a choice between accepting what was said by Air Vice-Marshal Collings and what was said by Mr Campbell who, if his statement is correct, is no doubt defending the provisioning of the armed forces in accordance with the supply policy of the Department. If he is wrong, a Senate committee and the Senate have been misled about the way in which the Department has carried out in a sufficiently competent way the policy of making available spares to operational squadrons. If he is correct, it would seem that Air Vice- Marshal Collings is guilty, on the face of it, of misleading the public, in a forum which was reported, in a way which could only lead to the inference being drawn by the general public reading such reports that in fact the Government was not providing sufficient resources to enable our operational squadrons to function without the cannibalising of aircraft. Air Vice-Marshal Collings said that this practice was required to meet many demands from operational squadrons for spares. Therefore we have a conflict. The Attorney-General (Senator Gareth Evans) has responded to matters concerning Estimates Committee E in an exemplary manner. Nevertheless, I get a little tired of the bland answers we tend to get from officers at Estimates committee hearings who try to paper over differences of a very real and substantial nature . Either Air Vice-Marshal Collings ought to be reprimanded or Mr Campbell ought to be reprimanded. Both cannot be complimented on the truthfulness of their assertions. Senator GARETH EVANS(Victoria-Attorney-General)(3.58) —I believe it is primarily a matter of the perspective from which one views these things at any given time. When Air Vice-Marshal B. H. Collings made his comments which received very widespread public reporting he was acting in the capacity of officer commanding Command Support. I am now in a position to advise Senator Tate that in his new capacity as Chief of Joint Operations and Plans, Air Vice- Marshal B. H. Collings in fact approved the particular answer that I put down today. It is a matter simply of the emphasis which one gives, I suppose, to the situation as one sees it from the seat one is sitting in. It is generally accepted by everyone concerned that cannibalisation is a thoroughly undesirable state of affairs. But, equally, it is accepted by all the officers concerned, and I guess all the civilians concerned who have made a study of it, that it will simply never be possible to have all spares available for all contingencies , and cannibalisation under those circumstances simply does become probably the only way of overcoming temporary spares unavailability that even the best run and most model defence force is capable of imagining. I do not believe it is possible to take any further the matter to which Senator Tate refers. I believe the public record has been clarified by the answer I have given today. As I say, it is a position which Air Vice-Marshal Collings himself has agreed to. Senator TATE(Tasmania)(3.59) —I want to ask the following question: When serving officers appear before such clubs as the National Aviation Press Club in order to make statements which create a quite misleading impression in the public mind when reported, as they are intended to be reported-as I say, this statement was not made at a private meeting; it was made to the National Aviation Press Club-who clears their speeches? Can we get a copy of the speech? If such speeches do have an incorrect emphasis which is remedied months later by way of answer in this chamber, does the person concerned go before the same Press Club to give a different emphasis from the new seat he might now occupy? Senator GARETH EVANS(Victoria-Attorney-General)(4.00) —I think the matters raised by the honourable senator are best referred to the Minister for Defence ( Mr Scholes) for an appropriate reply, and I will do so. I simply comment to the honourable senator that it is not an experience confined to serving officers to have one's speeches reported in circumstances which one may not anticipate or in a way that is in fact misleading as compared with the impression one wishes to convey. Most practising politicians would have had experiences of that kind. I am sure that Air Vice-Marshal Collings is now rather wiser as a result of his experiences on that occasion. Proposed expenditure agreed to. Department of Defence Support Proposed expenditure, $310,333,000. Senator PETER RAE(Tasmania)(4.01) —I wish to ask for some update, if it is possible, in relation to the defence review which the Minister for Defence (Mr Scholes) has indicated is taking place. I wish to know whether it will include the Australian industry participation program, which I would suggest is an important element in defence policy as a whole. The value-added basis for measurement of the Australian percentage required for government defence purchases overseas is certainly a matter which a number of people in the industry regard as being one which could be reviewed. Can the Attorney-General indicate the current state in relation to that matter and will it form part of the overall review? When can we anticipate some further information in relation to it? Senator GARETH EVANS(Victoria-Attorney-General)(4.02) —The most we can say at this stage is that the review in question will be a full one covering all aspects of the Department of Defence Support over a period. What the precise timetable is and the point in the process at which the Australian industry participation program will come under the microscope is not something we are now in a position to answer. I will seek a proper reply for the honourable senator in due course. Senator PETER RAE(Tasmania)(4.03) —I thank the Attorney-General. I wish to ask a similar question, and I expect the same reply, in relation to the question of research and development and the extent to which provision is made in the Government's program for increasing the funds available for research and development. Will there be some concentration of further funds for research and development which have been requested by many sectors associated with defence support? Senator GARETH EVANS(Victoria-Attorney-General)(4.04) —The reply is indeed identical. Senator PETER RAE(Tasmania)(4.04) —A further question I should like to ask relates to recent publicity given to the cluster bomb project which has been vetoed. In the Canberra Times of 4 November 1983, there is a report which is sub -headed 'Defence bows to Defence Support'. It suggests that the Minister for Defence Support (Mr Howe) vetoed the development of the Karinga cluster bomb which the Royal Australian Air Force was keen to develop, regarding it as superior to the United States-made CBU58. The decision seems to have been made on some ideological ground rather than on defence grounds. I wonder whether the Attorney-General has any information or could obtain some information in relation to whether that newspaper report is accurate and whether it is true to say that the grounds were not defence related grounds but other ideological grounds. Senator GARETH EVANS(Victoria-Attorney-General)(4.05) —I am somewhat surprised at the suggestion that reactions to cluster bombs should be regarded as ideological in character, but to the extent that there were competing views about the principles that may be involved in Government support for contracts of this kind, I will seek further information and supply it to the honourable senator as soon as possible. As to the last question asked by the honourable senator, I have just been advised that the research and development laboratories are now with the Department of Defence rather than the Department of Defence Support, so the question is more appropriately directed to the Minister for Defence (Mr Scholes). The answer is still the same in any event: I will seek an answer from him. Senator TATE(Tasmania)(4.06) —Mr Chairman, perhaps it would have been more proper to have raised this matter when the Department of Defence officials were present. As to the Department of Defence Support, in regard to the Auditor- General's report, which provided the substance of much of the questioning of Estimates Committee E, it is quite clear that the Department of Defence Support was very responsive to the criticisms which had been levelled in the report. In combination with the Department of Finance, it is taking matters in hand and admitted the validity of the criticisms within the Auditor-General's report. That is not a bad basis upon which to begin to take seriously the sorts of reforms in administrative and management procedures which the report indicated were necessary. Of course, the reforms do not have to be carried out in precisely the way in which the Auditor-General would wish but, nevertheless, there was a general willingness to try to achieve arrangements which would overcome the bases of criticism in the Auditor-General's report. By contrast, the Department of Defence seemed quite unwilling to admit the validity of any of the criticisms levelled consistently over a period of years by the Auditor-General in relation to project management particularly, and I know that Senator Watson has taken an interest in this matter over some years. It is a pity that officers of the Department of Defence are not here, but it would not be right, since it forms part of that report to the Senate of Estimates Committee E, to let the occasion pass without giving an example. On page 302 of the evidence of the Committee's proceedings, I raised the question of the Auditor-General's comments on page 34 of his report, where he said: . . . project directors need to be given more effective control of their respective projects so that project administration and control can be enhanced. The Auditor-General then went on to make five or six points and came to the conclusion that the Department of Defence did not have such arrangements. I asked a question on this, to which I had this reply from Mr Welsh: I think the report rather tends to look at it somewhat simplistically in the sense that it does not appreciate the complex interrelationships which exist within a department such as our Defence Department. What a ludicrous statement from an official attempting to defend his Department' s practices against the criticism of the Auditor-General. He made a sweeping comment that the Auditor-General, who had undertaken an exhaustive examination of arrangements within the Department of Defence, did not understand what a complex operation the Defence Department is. In fact, Audit commented on the underlying cause of the problems. On page 38 of the Auditor-General's report it is stated: Audit is of the view that urgent action is needed so that all issues within the control of the Department are fully recognised and appropriate measures taken to contain lead times, ensure adherence to specified service requirements and minimise cost escalation. In other words, an examination had been undertaken of all the issues which were within the power of the Department to remedy. The Auditor-General was urging upon the Department certain specific improvements in project management, amongst other things. The fact is that here we had a department which, by the tone and actual words of its responses to honourable senators during Estimates Committee E, was quite obstinate in its refusal to acknowledge the validity of the Auditor -General's comments. Once again I ask the Attorney-General (Senator Gareth Evans ) to note the comments and concern of Estimates Committee E and to give an assurance to the Committee that steps will be taken to ensure that the Auditor- General's report is taken more seriously by the Department of Defence so that we may have some report in the near future of the Department's more ready acceptance of the need to take measures in relation to the matters commented upon. Senator GARETH EVANS(Victoria-Attorney-General)(4.10) —Of course, Senator Tate is stretching a slightly long bow in seeking further responses on the Department of Defence under our consideration of the estimates of the Department of Defence Support. Nonetheless, I am able to say, with appropriate expressions of humility on behalf of the Minister for Defence (Mr Scholes), that the Department of Defence regrets that it appeared to the Committee that the Department did not take seriously criticisms by the Auditor-General. As the Department's focus on improvement of the present procurement system demonstrates, the Department does regard these matters with the utmost seriousness and welcomes the opportunity presented by the Auditor-General's reviews to improve the efficiency of the Department. There are a number of pages expanding upon that general theme but I will advert to two particular matters. The Department of Defence accepts the view of the Auditor-General and Estimates Committee E that there is a need for improved management of capital equipment projects. As the Auditor-General's Department notes, a number of initiatives have already been taken to achieve that aim. However, the Department agrees that more needs to be done. Proposals for fundamental reorganisation for procurement of equipment, which were put by the Department to the Defence Review Committee, are still under consideration. Further work is being done on them by the Department at present. As to the question of project management, the particular response is this: Estimates Committee E expressed the view in its report that in the near future there should be a comprehensive review of the Defence Department project management practices and performances. The Department does not shrink from such a review but notes that there have been three external reviews of equipment procurement related activities in recent times-the Katter report, the Aldred report of the sub-committee of the House of Representatives Standing Committee on Expenditure and, of course, the Utz Defence Review Committee report in 1982. The recommendations of the Defence Review Committee, of the Auditor-General and of Estimates Committee E are in this respect under active consideration and the Parliament will be informed of the outcome at the appropriate time. The Committee may be assured that measures to improve the organisation and performance of defence procurement will be part of the outcome. Proposed expenditure agreed to. Senator TATE —(Tasmania)-by leave-Estimates Committee E found in its examination of the estimates of various departments that there seemed to be some ill understanding of the Minister for Finance's seeking of $53m for expenditure in respect of salaries and administrative expenses for the commencement, continuation or expansion of government programs. In fact, there was a variation in response from departments, some appearing to be aware of the general appropriation and their possibility of getting access to those funds and representatives at quite senior levels of other departments being unable to indicate either a knowledge of that fund existing or of how they might make use of it. We report that fact to the Committee and note that there seems to be some new category emerging in appropriations under Division 312 of the estimates for the Department of Finance. The fact is that the Committee is very concerned that there seems to be a move away from the urgent and unforeseen criteria governing the use of the Advance to the Minister for Finance, which has become a fairly regular feature of parliamentary appropriations. We are concerned that there is a provision for the servicing by providing of salaries and so on within the Public Service of new programs, which new programs are not coming before the Parliament in a way which enables the Senate to deal with them because they are in Appropriation Bill (No. 1) rather than in Appropriation Bill (No. 2). I know this will be of concern to Senator Peter Rae who is keen on Senate surveillance of such matters. I cannot go into the full details of all this except to say that a reply was received from the Minister for Finance, Mr Dawkins, to Senator Sibraa and to the concern of the Committee. Amongst other things, it stated: For purposes of Parliamentary control and disclosure the Government considered that the global provision- that is the $53m- should be subject to specific conditions which would allow Parliament to be informed fully of the eventual disposition of the provision. Those conditions-as expressed within Division 312-are designed to meet those aims. In other words, there is an attempt to suggest that somehow Parliament would be fully informed of the eventual disposition of the provision. I would turn the words around and say that what he is really saying is that we would be eventually informed of the full disposition of the funds rather than that we would be fully informed of the eventual dispostion. In other words, after the event, the Senate might be informed of what was going on with this $53m. When one looks at the conditions in Division 312 to get some assurance that the Senate would find a means of putting the expenditure of these moneys under scrutiny, it states: Division 312.-SPECIAL FUNDS FOR EXPENDITURE IN RELATION TO GOVERNMENT PROGRAMS AT THE DIRECTION OF THE MINISTER FOR FINANCE To enable the Minister for Finance to make moneys available for expenditure in respect of salaries and payments in the nature of salaries and administrative expenses, being expenditure- (a) that the Minister for Finance from time to time determines is necessary for the commencement, continuation or expansion of Government programs; (b) particulars of which will, as soon as practicable after he has so determined, be submitted to the Parliament; and (c) that is expenditure for the ordinary annual services of the Government. In fact that does not put Parliament or the Senate in any position to put those proposed expenditures under any real scrutiny. It provides an after the event submission to the Parliament of how the funds have been spent. Certainly, it is not a condition in the sense of enabling something to be fulfilled within this chamber before the funds are dispersed for those purposes. The fact is that in the accord which was struck between the House of Representatives and the Senate some years ago, the idea was that new programs should be placed in Appropriation Bill (No. 2), which is amendable by the Senate, and that ordinary annual services expenditure be in Appropriation Bill (No. 1) as a continuing part of providing for departmental salaries, et cetera. Division 312, which is commented upon by Estimates Committee E, seems to create a situation which allows the financing of new policies not previously authorised and not put under separate scrutiny by the Senate by their inclusion in Appropriation Bill (No. 2), which is amendable by the Senate. This new practice seems to allow the growth of new policies and new initiatives by Government without the possibility of that sort of scrutiny by the Senate. I raise this for the purpose of elaborating to honourable senators on the report to the Senate by Estimates Committee E and hope that we can get some clarification. Senator PETER RAE(Tasmania) —by leave-I indicate my support for the concern which has been expressed by the Committee and by Senator Tate on behalf of the Committee and I explain to the Committee the change which has come about and the extent to which this appears to be a departure from the compact of 1965, a departure from the practice which has been followed by the Senate and by government since that time. It is an integral part of the Estimates committee procedure and an integral part of even the constitutional relationship between the Houses and the matters which can give rise to very serious consequences in relation to questions such as double dissolutions. I do not think it is a matter which ought to slip by for the want of attention being given to it. I wish to support any action which Senator Tate may like to take for this matter to be referred to the Senate Standing Committee on Finance and Government Operations for its consideration and report to the Senate as it did with the question of the use of the Advance to the Minister for Finance when my colleague Senator Dame Margaret Guilfoyle was the Minister for Finance. What I believed to be a very appropriate and acceptable arrangement was developed and outlined in that Committee's report and any of the previously expressed concern was withdrawn. That arrangement was happily accepted by the Committee. I think that was an excellent example of the way in which a co-operative approach can be adopted to ensure that undesirable practices do not develop. It may be that this is something which happened entirely by oversight or without specific regard being paid to what the consequences would be. Consequences are a major change; they are undesirable. I suggest to Senator Tate that he might like to consider, as the representative of Estimates Committee E, taking the action which I have mentioned. The CHAIRMAN —I draw the attention of the Committee to the fact that the Chair will be putting separately the question relating to the Advance to the Minister for Finance after completion of consideration of Appropriation Bills Nos (1) and (2). There will be a chance to debate it then. Senator Dame MARGARET GUILFOYLE — (Victoria)-by leave-I wish to make a very brief comment because of the way in which this item was included in the Budget Bills. Explanations were given to the Committee of which I was a member that it was inappropriate that funds for these purposes be drawn from the Advance to the Minister for Finance in view of the very stringent requirements for the use of that fund and the urgent and unforeseen nature of the expenditure. It has been expressed to me that, in this year's Budget, there are new programs and an expansion of existing programs which will require staffing. I believe there are proposals for staff to be introduced into departments from outside the Public Service, which is a new procedure. I am not aware how much of the funds will be used for that purpose. We were told that about $20m of the $53m could relate to the requirements of the Department of Social Security and perhaps the Department of Veterans' Affairs in some of the new proposals in those departments. I think it is timely that Senator Tate and Senator Peter Rae have drawn attention to this matter. If there is to be some further discussion or investigation of the matter, I think it would be a good thing to pursue because I believe that the Senate takes seriously its responsibilities with regard to the scrutiny of all of the appropriations including the Advance to the Minister for Finance under arrangements which now have been satisfactorily set up. If this is to be a continuing appropriation under Division 312 then I think we would require a great deal more information as to why there needs to be this separate funding from the normal funding, the Supplementary Estimates which come forward from time to time and the use of the Advance to the Minister for Finance. I think we are indebted to Senator Tate and to Senator Rae for his support of Senator Tate's remarks with regard to this division. I would certainly like a further explanation which did not seem to be able to be provided because it seemed that nobody could give any more definition to the expenditure that would flow from this fund than has already been given quite freely by the officers and by the Minister concerned. Senator TATE(Tasmania) —by leave-Mr Chairman, may I just clarify the matter? If this matter of Division 312-Special Funds for Expenditure in relation to Government Programs at the Direction of the Minister for Finance, were to be referred to the Senate Standing Committee on Finance and Government Operations for report, it would not be in the sense of a report on that particular estimate . In other words, we would be passing this estimate but it would be just to have a full review of the policy and to put that under scrutiny. Senator Peter Rae —In the same way that the Advance to the Minister for Finance was referred previously. Senator TATE —In that case I would certainly support that and seek the Minister' s response and so move in the light of that response. Senator WALSH(Western Australia-Minister for Resourses and Energy) —by leave-I have just checked one fact with Senator Tate. I have been advised that letters were sent, initially to Senator Tate and, subsequently, to all committee chairmen. I think Senator Tate may have been late in receiving his because he was overseas at the time. Senator Tate —I have not been overseas. Most of the Caucus thinks I am. It is wishful thinking. Senator WALSH —I am sorry, I will withdraw that. Letters were sent to all committee chairmen ultimately which, apparently, have not been regarded as being entirely satisfactory by Senator Tate, at least; I do not know about the other committee chairmen. If the Senate Standing Committee on Finance and Government Operations cares to take this matter up and examine it, that is a matter for the Committee. I do not think the Minister for Finance (Mr Dawkins) would have any objections but I cannot commit him without consulting him. Motion (by Senator Tate)-by leave-agreed to: That the policy questions underlying Division 312, Special Funds for Expenditure in relation to Government Programs at the Direction of the Minister for Finance, be referred to the Senate Standing Committee on Finance and Government Operations for report. GROUP F Department of Veterans' Affairs Proposed expenditure, $707,504,000. Senator MESSNER(South Australia)(4.27) —I do not think that the Minister for Veterans' Affairs (Senator Gietzelt) has arrived but there are a few questions that I want to address to him. Senator Walsh —I will take them on notice. Senator MESSNER —Good. Firstly, the Minister for Resources and Energy will be aware of the operations of the Vietnam Veterans Counselling Service. I am rather anxious to determine the exact situation which regard to client load and the numbers of persons using the centres at this stage and also to obtain from the Government an estimate as to the cost of operating each of the centres. They are now established in all capital cities in Australia including Darwin, Townsville and Canberra. Furthermore, I would like to find out what is the intention of the Government with regard to the establishment of further Vietnam veterans counselling centres; whether it is intended to open those in other parts of Australia, particularly country districts, or whether it will develop some alternative means of assisting people in the circumstances in which they are already being assisted perhaps through electronic means or by local medical assistants being employed to do so or on some other basis. I do not expect the Minister to respond to that now but perhaps he could take that point on notice. I am also anxious to find out about the current position with regard to the numbers of Vietnam veterans who have received free medical assistance since the introduction of free services in the case of urgent need for Vietnam veterans, which I think was introduced in January 1982. Perhaps he could take that on notice as well. Some time ago I asked the Minister, also on notice, whether he would inform us as to the expected cost of the Royal Commission on the Use and Effects of Chemical Agents on Australian Personnel in Vietnam. Perhaps the Minister at the table, the Minister for Resources and Energy (Senator Walsh), will take that question on board as well and seek an early reply. I am not looking for the current year's estimate of expenditure, which of course is set down in the Budget Papers, but I do want the overall estimate, which may be available from the Minister as well. Turning to the question of defence service homes, I note the Government's introduction of taxation on lump sums for superannuation purposes, which of course was announced in the economic statement on 19 May. It has been admitted by the Government that this will affect servicemen who retire early, as it will other persons who retire early. I instance the case of an Army officer who may retire at the age of, say, 45 never having owned his own home but who, having retired at that early age, may seek to commute part of his Defence Force retirement benefit pension to a lump sum in order to invest that in a home or perhaps even to buy a business. The point that interests me is that the new taxation measure will have two effects on servicemen: Firstly, there will be a reduction in the amount which a serviceman will be able to contribute of his own means to the purchase of a house; and, secondly, when the new arrangements recently announced by the Minister to alleviate or to offset the disadvantage of paying taxes in these circumstances are applied-that is, to allow an extra year's commutation of the pension-that will in fact lead to a reduction of future pension, that is income, available to a retired serviceman. On both grounds the serviceman will be left in a more difficult situation in obtaining finance for his house. The question I ask is whether the Government intends to review the defence service homes arrangements in circumstances such as those I have just outlined so as to take account of this extra burden being borne by servicemen who, of course, will be caught by the new taxation arrangements applicable to lump sum superannuation receipts. Another point I make is in regard to the assets test proposed by the Government . This applies, of course, very much to the Department of Social Security, as it does to the Department of Veterans' Affairs. I have been interested in recent days to see various reports in the Press estimating that some $300m are to be saved in the Department of Veterans' Affairs upon the introduction of an assets test for those receiving service pensions. Indeed, in this place last week the Minister for Veterans' Affairs outlined to us, without giving names, a range of people who were very wealthy or at least in the wealthy category and who it would be expected in normal circumstances could look after themselves. I think the Minister said at that time that some 3 per cent of service pensioners may lose their pensions and that that would represent a saving to the revenue. The point I make is that that is a very small number so what other groups of people will be severely disadvantaged to make up the amount of some $300m that it is estimated will be saved? It seems to me that there is a very considerable variation there. It may well be that the Press does not have the figures right, as is often the case in these matters. I also draw to the Minister's attention the fact that there is a positive incentive for people to become eligible for the service pension because on obtaining that entitlement an ex-serviceman is rendered eligible for other benefits within the repatriation system. A positive incentive exists for people to obtain the service pension, even when they may not need it. It really does raise the question that I have been trying to draw to the Committee's attention for some time in respect of the Department of Social Security; that is, that a very clear incentive exists for people to seek health care benefits through both the veterans' affairs system and the social security system by virtue of the nexus of those health care advantages, through the pensioner health benefit card in the case of the Department of Social Security and the disability system in the case of the Department of Veterans' Affairs, with the service pension. It seems to me that the Government, instead of charging around all over the place like the Light Brigade accusing people of being over-wealthy and also in receipt of pensions, should examine the exact and fundamental reasons why people are seeking to render themselves eligible to receive these benefits. It is a fact of life that, whether one is a service pensioner or an old age pensioner, not only income security is paramount in the minds of people as they grow older; they also have a very real concern about serious and perhaps catostrophic illness as they grow older. Consequently there is very strong encouragement for people to consider obtaining an entitlement for health care benefits through those two departments while that connection exists. The Minister would know that under current arrangements one must obtain a service pension in order to qualify for the special total health care benefits available through the Department of Veterans' Affairs if one has a disability pension of 50 per cent or higher. I again draw that matter to the Government's attention as I believe it requires consideration. I do not make the point that service pensioners who may be arranging their affairs in the way I have just outlined ought to lose their pensions as a result of this examination; rather I draw to the Government's attention the fact that there are numerous reasons why people are arranging their affairs in the way that they are in order to obtain pensions. It is not simply a question of having very large assets and somehow engaging in schemes in order to rip the system off . I do believe it is something that the Government ought to take into account in the course of its examination, which I understand the Caucus committees or Caucus itself are examining at present. Senator WALSH(Western Australia-Minister for Resources and Energy)(4.39) —I think all the factual material on which Senator Messner has requested information should be freely available and I will certainly approach the Minister for Veterans' Affairs (Senator Gietzelt) with a view to making it available as soon as possible. There are a couple of matters, however, over which I should lodge some caveat because the Minister could well judge these to be future policy matters on which he is not prepared to make statements. One of those concerns the Government's intentions regarding the extension of the Vietnam veterans' counselling centres to a greater number and to areas in which they are not currently situated, but I will pass the request on. I just serve notice that that is something which in my view might well be regarded as a policy question. Another point on which I will seek the Minister's opinion was Senator Messner's question-I think I wrote it down correctly-as to whether the Government contemplates any further review of the tax treatment of superannuation payments from the Defence Force Retirement Benefits Fund. Senator Messner —Rather what is contemplated in regard to defence service homes- that side of it. Senator WALSH —And defence service homes. Again, as far as I know no review is being contemplated. I will refer that to the Minister. Again that could be regarded as a policy question. I think most of the other matters raised by Senator Messner are requests for straight factual information which I would expect can be supplied within a reasonable time. Proposed expenditure agreed to. Department of Transport Proposed expenditure, $183,810,000. Senator PETER RAE(Tasmania)(4.41) —I would like to refer not only to the vote for the Department of Transport but also to a certain aspect of the vote for the Department of Aviation. I want to address myself to bringing together services in relation to each of the departments. So far as the Department of Transport is concerned I refer to division 664.2.13 which deals with search and rescue, and accident investigation. In relation to the Department of Aviation, I refer to division 193.2.17 which deals with search and rescue, and accident investigation . The particular matter to which I wish to refer may be regarded as being relevant to both departments. At the time this particular event occurred it was more relevant as far as the Department of Aviation was concerned but as to what might happen in the future it would be more relevant to the Department of Transport. I refer to the loss of an Aero Commander aircraft on Sunday 17 July this year in Bass Strait in what could be summarised as an extremely unfortunate incident. A survivor from the crash was in the water for a period, was located but was not able to be rescued and eventually drowned. Actions which followed-a Mayday call was sent on that Sunday afternoon-have been very severely criticised by a wide cross section of people from aircraft pilots associations through to the editors of various newspapers. It may be said that some know more about it than others but there has been widespread criticism. I do not wish at this stage to go through the full detail of the matter but rather to ask what is the current state of development so far as both departments are concerned in considering any upgrading of liaison between the departments in the light of some of the criticisms that have been made of the shortcomings which were manifest in that particular operation. Senator WALSH(Western Australia-Minister for Resources and Energy)(4.43) —I am advised, as Senator Peter Rae has already intimated, that there is an overlap in responsibility between the Department of Transport and the Department of Aviation. I am advised that for marine rescue or search work the Department of Transport is responsible. The Department of Aviation is responsible for air rescue work. Meetings have been held recently between the two departments with a view to co-ordinating the sea and air searches in the sort of situation to which Senator Peter Rae referred. Senator PETER RAE(Tasmania)(4.44) —Whilst I referred to one incident in particular as an example, other cases have involved the same sort of overlap. I do not want to go through them all. I was not suggesting that because it happened once everything ought to happen; rather it has happened a sufficient number of times quite recently to have attention drawn to it. I would like to ask a further question. What has happened with regard to the Bureau of Air Safety Investigation report which, on 4 August 1983, the Minister for Aviation ( Mr Beazley) indicated was being undertaken? Senator WALSH(Western Australia-Minister for Resources and Energy)(4.45) —I will take that as a question on notice if that is satisfactory to Senator Peter Rae. Nobody is present to advise me on that matter. Senator PETER RAE(Tasmania)(4.45) —I can understand the problem faced by the Minister for Resources and Energy (Senator Walsh). I thank him very much. I add that a Press statement issued by the Minister for Aviation (Mr Beazley) on 4 August stated: . . . he had also requested his Department to make a submission on search and rescue activities as part of the current review into Australian coastal surveillance. I would be grateful if the Minister could obtain, either immediately or later, further information about that matter. I wish to indicate that when some answers to my questions are available I will seek an opportunity to raise for further debate in the Senate the question of the desirability or otherwise of a further and more independent inquiry into the conduct of search and rescue operations of various types in Australia. I do not want it to be taken that the matter is concluded because I have raised these questions now. Senator WALTERS(Tasmania)(4.46) —I wonder whether I could be given the breakdown of the running costs of each lighthouse? Senator WALSH(Western Australia-Minister for Resources and Energy)(4.47) —I will endeavour to obtain the information. I will take that as a question on notice too, if that is satisfactory. I do not know whether a breakdown is available in that sort of detail but we will do what we can. Senator WALTERS(Tasmania)(4.47) —I am sure that the Department of Transport could supply me with the running costs of the various lighthouses that are still manually controlled. I would like the varying costs itemised. Senator PETER RAE(Tasmania)(4.47) —I wish now to refer to a different matter entirely. It concerns the Department of Transport and its function in relation to the payment of the shipbuilding subsidy. What checking is done by the ship design group or any other body under Commonwealth control before Commonwealth approval is given for a shipbuilding project to commence and before it is regarded as eligible for the benefit of the subsidy? Further, what prudent practices have to be observed during the building to ensure that it is carried out as economically and efficiently as possible? Finally, does the Department have any role in checking the way in which the construction of a ship has been carried out before payment of the subsidy is finally made? There are three phases. What is the Commonwealth's role in relation to each of those phases? Again, if the Minister for Resources and Energy (Senator Walsh) is not able to give me detailed information, could he obtain it for me? Senator WALSH(Western Australia-Minister for Resources and Energy)(4.48) —I am advised that these administrative arrangements come within the Department of Industry and Commerce. The matter is covered by the Department of Industry and Commerce and not by the Department of Transport. Senator Peter Rae —But does the Department of Transport not have a part in relation to it? Senator WALSH —I am advised that it is a matter for the Department of Industry and Commerce. Leaving that aside, we will still try to get from the Department of Industry and Commerce the information requested by Senator Peter Rae. I am advised that the Department of Transport has no role in it. Senator PETER RAE(Tasmania)(4.49) — That is the information I was seeking. I wanted to know whether any role was fulfilled by the Department of Transport in relation to the steps I outlined and, if so, what it was. I will wait until we deal with the Department of Aviation to raise my next point because it is not a matter which overlaps into the Department of Transport. Senator CHANEY(Western Australia-Leader of the Opposition)(4.49) —I should like to raise a matter with the Minister for Resources and Energy which is relevant to this matter and to other matters which are still before us but also relevant to matters which have passed. Last week we had some quite extensive discussion in various parts of the appropriations and a series of matters were raised with the Minister on uranium prices, for example, and on compensation and various other matters. The Minister undertook to seek responses and to come back. I raised with the Leader of the Government in the Senate, Senator Button-he is otherwise engaged at present in a Cabinet sub-committee; that is why I am raising the matter in the Committee-the fact that the Opposition would like to see responses to those questions before the completion of the Appropriation Bills. There were some matters, for example, which Senator Walsh referred to the Department of Trade. I can understand that there can be a quite long chain in some of these things. My request to Senator Button was that we should, when we reach the end of Group F but before we pass the Bill, report progress and get on with the legislation with a view to coming back a little later this week to complete those matters when those answers and reponses are to hand. Senator Button undertook to come back. I have been in touch with his office. He is otherwise engaged. I simply raise the matter now so that there is not a last minute confusion as we reach the end of the appropriations. Senator WALSH(Western Australia-Minister for Resources and Energy)(4.51) — Senator Button spoke to me about this matter. I am not able to give a definitive answer about the Department of Trade. As I indicated at the time, I think a number of the answers to the questions asked would be regarded as being commercial in confidence information. Concerning the Department of Resources and Energy, I think the answers should be available by midday tomorrow, or some time tomorrow afternoon, anyway. I think that that includes-I do not want to be absolutely held to this because I had a very quick conversation about it-the question Senator Peter Rae had asked about the latest estimates of the cost of power produced from quite small reactors, down to 200 megawatts. Senator CHANEY(Western Australia-Leader of the Opposition)(4.52) —Can we take it from that that there is no objection to that procedure-that we adjourn them for the moment, collect up the answers, and then deal with them and complete the Bills after that information is to hand? Senator Walsh —Yes, that is agreed. Senator CHANEY —Thank you. Proposed expenditure agreed to. Department of Aviation Proposed expenditure, $430,812,000. Senator PETER RAE(Tasmania)(4.52) — With regard to the role of the Department of Aviation in the local ownership airport plan, has the Department any role, where a local authority is accepted, in deciding under what conditions or guidelines the contracting for work which is to be paid for by the Commonwealth is undertaken? Will the Minister indicate just how that works? There may then be a further question I should like to ask him. Senator WALSH(Western Australia-Minister for Resources and Energy)(4.53) —I am advised that in the circumstances of LOAP, there is a formal agreement between the local authority and the Commonwealth which is administered by the Department of Aviation and that some ongoing supervision of contracted work is undertaken by the Department. Senator PETER RAE(Tasmania)(4.54) —In the preparation of that, is advice ever, commonly or otherwise, obtained from the Department of Finance? In particular, I ask whether the calling of tenders and the engagement of professional services, architectural design engineering, supervising materials, purchasing and all those sorts of things are matters which are checked or just left to the local authority. Are there standard requirements for the time at which tenders will be advertised, and that sort of thing? If so, can those guidelines be provided? Senator WALSH(Western Australia-Minister for Resources and Energy)(4.55) —The Department of Finance, so I am advised, is consulted in drawing up the programs and the supervision, mutually agreed in the two Commonwealth departments' programs, is then conducted by the Department of Aviation. As to whether there are formal guidlines, that is, written guidelines, we will have to take that question on notice. We are just not aware of it now. If there are written guidelines, I will approach the Minister to see whether they can be made available. I take it that the thrust of the honourable senator's questioning here is to ensure that moneys which are ultimately provided by the Commonwealth are spent in accordance with the procedures normally followed for the spending of Commonwealth money. Senator Peter Rae —Yes. Thank you. Senator WATSON(Tasmania)(4.56) —I take the opportunity afforded by this debate of asking a question of the Minister for Resources and Energy. Have the radar and associated navigational system at Canberra Airport been subject to service difficulties or operational difficulties during the past several months? Senator WALSH(Western Australia-Minister for Resources and Energy)(4.56) —My general understanding is that some maintenance activities have been undertaken. If Senator Watson is willing to accept the fine detail of that being treated as a question on notice, that is the way in which it will be handled. Senator PETER RAE(Tasmania)(4.57) —I should like to ask a question in relation to certain matters raised by Mr R. G. Ansett, the Managing Director of Budget Rent A Car System Pty Ltd, in a letter sent to a cross-section of members of parliament in relation to Trans Australia Airlines and Hertz. It is alleged in the letter that the Australian taxpayer has lost $7.5m to date through TAA's interest in Hertz, and that the Australian taxpayer will lose a further $6.9m because TAA has made an arrangement which allows another company to avoid paying company tax and the loss will take place if this arrangement is allowed to stand . I ask the Minister whether there is any comment which can be made as to the accuracy or otherwise of those allegations and whether any steps are being taken in relation to the second aspect, which is to review the basis upon which the sale of Hertz by TAA has been arranged. Senator WALSH(Western Australia-Minister for Resources and Energy)(4.58) —I would expect that some of that matter would be regarded as a policy question, but I will refer it to the Minister for Aviation (Mr Beazley) and invite him to make any comments or declaration of intent that he feels inclined to do. Is that satisfactory? Senator Peter Rae —Thank you. Senator Dame MARGARET GUILFOYLE(Victoria)(4.58) —I have an interest in the same matter. One of the members of the Standing Committee on Finance and Government Operations had asked that I refer this matter to that Committee tomorrow for its consideration whether the matter ought to be subject to investigation. I simply indicate that, as Senator Peter Rae has introduced it into this debate, that was my intention, and that this letter has been received by a number of honourable senators and, I presume, members of the House of Representatives, and which refers to the arrangements, may be something that could be subject to further investigation. If it transpires that the Finance and Government Operations Committee expresses some interest in it, that may be the course which should be followed. Senator PETER RAE(Tasmania)(4.59) —I thank Senator Dame Margaret Guilfoyle for that contribution. If the Standing Committee on Finance and Government Operations pursues the matter, I would be more than content to leave it there. In other words, perhaps Senator Dame Margaret Guilfoyle could let me know, and I will let the Minister know, whether it is going ahead in that way or whether I should still seek an answer. Proposed expenditure agreed to. Department of Administrative Services Proposed expenditure, $363,091,000. Rent (Defence) Proposed expenditure, $56,200,000. Acquisition of Sites and Buildings (Defence) Proposed expenditure, $22,000,000. Rent (Defence Support) Proposed expenditure, $1,423,000. Acquisition of Sites and Buildings (Defence Support) Proposed expenditure, $310,000. Senator REID(Australian Capital Territory)(5.00) —I raise the question of the allocation of security contracts. In particular, I refer to a contract the number of which is RT62/02946L-1. I do not wish to refer to the name of the person who has that contract at this time, but I wonder what checks are made of people who get security contracts. What steps are taken to look into their backgrounds and to check whether they have any criminal records? In this particular instance, as I understand it, the person who was allocated this contract was convicted on 19 charges of false pretences in July this year and may have a criminal record going back beyond that time. I would be inclined to think that most taxpayers would think that people who get security contracts are credible in every sense and regarded as trustworthy. I appreciate, of course, that a person who has been convicted of any offence, having paid his penalty to society, is entitled to go on with his life. But I wonder whether the checks of people getting contracts in the security area are as detailed as they might be and whether, in this case, there is the background to which I refer. Senator WALSH(Western Australia-Minister for Resources and Energy)(5.01) —I am advised that security clearances of people associated with contracts of this nature are not normally undertaken by the Department of Administrative Services unless the client department so requests. The specific contract to which Senator Reid has referred, I believe, is related to the Belconnen and Woden bus depots. That has been identified from the number the honourable senator quoted. Senator REID(Australian Capital Territory)(5.02) —Perhaps some inquiries could be made as to the background and the holding of this contract and as to whether the person concerned was involved in any way with the offences to which I briefly referred and, in view of which, whether he could be regarded as being in an area that is in any sense sensitive. Senator WALSH(Western Australia-Minister for Resources and Energy)(5.03) —I will pass that request on to the Minister. Senator REID(Australian Capital Territory)(5.03) —I raise briefly another matter. Is the paper from government buildings, from this building in particular , still under contract to be recycled? Is it being recycled? Are checks made to make sure that the recycling arrangements are properly carried out? Senator RYAN(Australian Capital Territory-Minister for Education and Youth Affairs)(5.04) —That information is not available, but I will make sure that the honourable senator has it passed on to her. Proposed expenditure agreed to. Department of Territories and Local Government Proposed expenditure, $141,997,000. Senator REID(Australian Capital Territory)(5.05) —During the Estimates Committee hearings I raised the question of the multi-cab which is a cab that operates in Canberra for the purpose of transporting handicapped people. At the time the Minister said that no allocation of funds had been made to assist multi -cab to continue running, and that it was the judgment of the Minister that funds for that purpose should not be made. I will not go into the full details of the background but the service has been provided by Aerial Taxis. That really means that it has been provided by the taxi drivers of Canberra for some considerable time at their own expense and it is running at a considerable loss. One way of overcoming the loss is for the cab to be licensed to hire at taxi ranks the same as other taxis are able to do. This would assist it to be more economical and viable. In a letter to me on 26 May, the Minister for Territories and Local Government (Mr Uren) said: . . . my Department has forwarded instructions to the draftsman at Attorney- General's for amendments to the legislation which will enable the cab to stand for hire at taxi ranks along with other cabs . . . I have asked that the necessary amendments be given a high priority. Could I know where that legislation is? Senator RYAN(Australian Capital Territory-Minister for Education and Youth Affairs)(5.06) —Mr Chairman, I am informed that that is still the position. Senator REID(Australian Capital Territory)(5.06) —In relation to that reply, I make the comment that I hope that it would mean that the legislation would appear at least within one day, if not two. The casino legislation was produced in 10 days from the announcement that there would be a casino in this community to when the ordinance was signed by the Governor-General. I am referring to a matter about which the Minister said on 26 May that he was asking for this legislation to be given a high priority. Perhaps it is not important to some of the people involved, but it is important to the handicapped of this community and to the taxi drivers who are attempting to provide the service. Senator RYAN(Australian Capital Territory-Minister for Education and Youth Affairs)(5.07) —I will make sure that the Minister is informed of Senator Reid's concern in this matter. Senator REID(Australian Capital Territory)(5.07) —In the Budget Estimates there is an increase in motor vehicle registration. In relation to a concession for registration which applied to certain members of the Rats of Tobruk Association, pursuant to a rebate on registration fees for incapacitated soldiers which is dated 9 November 1943 certain concessions were waived. I understand that in recent times members of the Association who were previously eligible for the concession have been told that they are no longer eligible, at least to the same extent that they had been. In a letter from the Association it was stated: One of our members visited the Motor Vehicle Registry recently to seek renewal of his concessional registration which he had enjoyed for many years. He was told by the officer in charge of the counter staff that the Director of the Motor Registry had issued an instruction dated 24th June, 1983 directing that it was now to be given only to totally and permanently incapacitated Veterans. It was suggested in this letter to me that the Rats are getting too old to fight back. I hope that that is not the reason any change has been made. The concession has existed for some considerable time. Has it been changed? Has any notification of this been given to anybody, in particular, to those who have enjoyed the concession up until now? It is a matter about which I have written to the Minister, but have not yet had any response from him. Those concerned are anxious. Senator RYAN(Australian Capital Territory-Minister for Education and Youth Affairs)(5.08) —There is no information available at this stage, but I will ask the Minister to address the questions raised by Senator Reid in her letter to him and in this discussion and to attend to them urgently. Senator REID(Australian Capital Territory)(5.09) —I refer back to a matter that was raised during consideration of the Estimates for the Department of Education . Senator Ryan said that she would make available a paper on the Australian scholastic aptitude test bias and has done so, but it was mentioned that it would be tabled. I wonder whether that will happen. I ask about it for the sake of the completion of the formalities. Senator RYAN(Australian Capital Territory-Minister for Education and Youth Affairs)(5.10) —Senator Reid has the paper. Does she wish it to be tabled as well? Senator Reid —I think perhaps it should be. The Minister did say that she would table it. I just think for the completeness of the record that would be desirable. Senator RYAN —Certainly. Proposed expenditure agreed to. Progress reported. Consideration resumed from 19 October 1983, on motion by Senator Grimes: 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 7 September 1983. In Committee Motion (by Senator Ryan) agreed to: That the Committee approves the statement, for the year 1982-83, of heads of expenditure and the amounts charged thereto pursuant to section 36A of the Audit Act 1901. Resolution reported; report adopted. [COGNATE BILLS: INTERNATIONAL MONETARY FUND (QUOTA INCREASE) BILL 1983 ASIAN DEVELOPMENT BANK (ADDITIONAL SUBSCRIPTION) BILL 1983] Debate resumed from 20 September 1983, on motion by Senator Grimes: That the Bill be now read a second time. Senator RYAN(Australian Capital Territory-Minister for Education and Youth Affairs) —Mr Acting Deputy President, may I suggest that the Senate have a general debate covering this Bill, the International Monetary Fund (Quota Increase) Bill and the Asian Development Bank (Additional Subscription) Bill. The ACTING DEPUTY PRESIDENT(Senator Lewis) —Is it the wish of the Senate to have a general debate covering the three Bills? There being no objection, I will allow that course to be followed. Senator PETER RAE(Tasmania)(5.15) —I wish to speak with brevity on the International Development Association (Special Contribution) Bill 1983, the International Monetary Fund (Quota Increase) Bill 1983 and the Asian Development Bank (Additional Subscription) Bill 1983 only because I have been asked to keep my speech short to encourage the passage of some legislation, following a fairly lengthy period of consideration of the Appropriation Bills. For that reason I will curtail the remarks which I would otherwise have made in indicating that the Opposition supports the Bills, and in particular the Asian Development Bank (Additional Subscription) Bill which provides for an additional subscription by Australia. The position is that Australia and the other nations in the area covered by the Asian Development Bank are trading partners of very great significance. It is important for us to remember the nature of the Asian-Pacific region and the developments which not only have taken place but which will take place in what is so often termed the Western Pacific. The Opposition warmly and strongly supports the development of trade, industry, commerce and financial links with those areas. I do not wish to be taken as ignoring the existence of what the Prime Minister (Mr Hawke) has called a ripple on an otherwise harmonius relationship but I do not want to debate that when I am talking about trade and economic and financial affairs. I mention it only to show that I have not ignored it. I think it is far more important at the moment, in relation to these Bills, to look at the developments which have taken place. After the creation of the European Economic Community and Britain's belated but very real joining of that Economic Community , Australia found itself in a position in which it had to reorganise its trading relationships. It had to find and help develop completely new markets and had to ensure that it was able to offset the tremendous trade disadvantages which befell it as a result of the creation of the European Economic Community and particularly the development of the common agricultural policy which had such a significant and harsh impact on various sections of Australian industry. One of the things it is important for us to remember in looking at any of these matters is that something that adversely affects primary industry has a follow through adverse effect on secondary and tertiary industries in Australia. There is no way we can say that it affects just one sector. The impact of the common agricultural policy on Australia is important, and it is important, when we start to look at the development of the economies of the areas of the world with which we are now able to develop new and I hope lasting and mutually beneficial relationships, that we look also at Australia's role and position as an international trader and whether or not it can hold its head up high in that respect. One of the important aspects of this role is one about which Australia, I think often unjustly, is accused or misunderstood. I refer to the question of protection. Australia is probably a high protection country only to the extent that anyone accepts that if a country is absolutely honest and has its protection out front where everybody can see it, it can be characterised as being high protection when it is being compared with some of the countries that have lowered their obvious barriers while raising innumerable other barriers to prevent the free trade which so many people piously espouse but so seldom practise. I think it is relevant that we have regard to Australia's position with regard to the Asian Development Bank and the economic development of the Association of South East Asian Nations and Western Pacific regions. Australia has 84.2 per cent of its imports from ASEAN countries cleared at non-protective rates of duty. It has 99.4 per cent of its imports from Papua New Guinea cleared at non-protective rates of duty. For the most recent year the Australian average , overall, was 70 per cent. These are all indications I think that, for a country which has its methods of protection very obvious, we have done a great deal to try, firstly, to encourage the development of the ASEAN countries and the Western Pacific region and, secondly, to make known and obvious where our trade protection barriers lie. There are many other figures that maybe I ought to refer to, but I do not wish to take up the time of the Senate in doing that. I just say that thousands of trade barriers are raised by other countries by methods, which are not used by Australia to impede the free flow of trade. When we look at Australia's role in the development of the economic region I think it is important that we bear in mind that Australia is playing an important and a co-operative part in the development of the economies of the region. The economies of this region have been, for a significant period, subject in many ways to the dominance of Japan. Japan has been the earliest of the super-economies, the new economies, to develop. But the newly industrialised countries such as the Republic of Korea, the People's Republic of China, the ASEAN countries and the Province of Taiwan have all shown remarkable figures in their various ways. The current figures indicate that the growth that is taking place in the world, as it comes out of recession, is taking place earlier and faster in the ASEAN countries and the Western Pacific region than anywhere else. That being so, I believe the activities of the Asian Development Bank and the sympathies of the International Monetary Fund are highly desirable when one looks at this sort of development. One of the concerns I express in relation to the IMF is that the economies of the world have now become very substantially subjected to the wisdom and the dictates of the Organisation for Economic Co-operation and Development. Certainly a large percentage of the members of the OECD itself are not able to successfully put forward different economic policies from those approved by the OECD and expect to get an approval rating from the OECD. I think that the IMF tends to be influenced a little in a similar direction. One of my concerns is that we do not have a situation in which there is a flood of thought suddenly flashing around the world, particularly between some of the major bankers of the IMF, who undoubtedly have substantial influence with it, and those who are the creditors of the major debtor countries, such as Mexico, Brazil, Argentina and Poland, which could induce a situation whereby the purchasers of raw materials from countries such as that are induced to buy from those debtor countries to enable those debtors to service their international debts. If that were to happen Australia's responsibility in its borrowing programs will have been repaid by a clear and savage detriment to its trading capacity. I believe it is one of the aspects of responsibility that needs to be borne in mind when we talk about our participation in a number of these international economic and financial organisations. The strength of the economies of South East Asia and of the whole of the Western Pacific region is certainly one of the surprises, perhaps to many people of world development in recent times. In the period from 1977 to 1981 the ASEAN countries showed a growth rate of about 8 per cent, compared with Australia's average growth rate of 0.6 per cent. Forecasts indicate that countries such as Malaysia, Singapore and Thailand are likely to experience a growth rate, in real terms, of around 6 per cent. The most recent revised estimates would probably put the figure even higher than that. The figures for the Republic of Korea and the Province of Taiwan would probably go quite substantially higher than that. Australia's position, in terms of a real gross domestic product estimate of the order of 3 per cent, if it does take place, will show a significant improvement. The figure for the ASEAN area is likely to be higher than those for Latin America, Africa and South Africa, and the OECD average of 3 to perhaps 3.5 per cent. What we are looking at is Australia's participation, for the benefit of the whole of the region, in the development of that region and in a trading relationship which is based on mutual trust to the benefit of both. I believe it can be done. I believe it must be done. I believe Australia must continue to play its part in providing funds such as those to the Asian Development Bank which have enabled it to assist in a lot of the development that has taken place . Time does not permit me to go into more detail than that but, in carrying out what I was asked to do I indicate but briefly our support for these developments , our support for the part we play in the region and our support and enthusiasm for the potentiality of the region and for Australia's opportunity, an opportunity which it must not lose, to participate to an even greater extent in the growth which will take place in the Western Pacific region. I thank the Senate. Senator MASON(New South Wales)(5.27) -The Australian Democrats support the International Development Association (Special Contribution) Bill, the International Monetary Fund (Quota Increase) Bill and the Asian Development Bank (Additional Subscription) Bill with no great enthusiasm. They authorise Australian support for a variety of foreign aid mechanisms. The Bills call for no special comment except for the fact that they are aid Bills. I wish to raise one or two general points in that direction. The first is that the Bills deal with multilateral aid. Funds are to be provided to several large organisations- the International Development Association, the International Monetary Fund and the Asian Development Bank-and later dispensed by these organisations, generally to governments. This is where our want of enthusiasm comes in. It is notorious that in Third World countries particularly governments do not use aid well or effectively. At best they use the aid inappropriately, as I will shortly describe, but at worst that aid is used by a small class of people who wear a number of hats-that is, people who are in government, who are contractors and who have businesses-and who use that money to their ends and not to the benefit of the people of the country at large. This practice has become notorious. I think it has become notorious to the extent that even the Australian people now understand that there is something wrong in the situation of aid disposal, something which needs government examination at close level. I believe the Government ought to have looked even more closely in these Bills at whether money we are giving out is used in the best possible way in which it could be used. I know that many members of the Government-honourable senators and honourable members with whom I have discussed these matters-are deeply concerned about them. I think the time has come when we ought to look far more carefully at every aid dollar of any kind whatsoever that goes out from this country and at attaching conditions to it, not political conditions, not conditions designed to score our own political points, but conditions which are well established and well known by people who are authoritative in this area, to ensure that that money is spent in ways which would be of service to a world which, heaven knows, needs it badly enough. Only too small an amount of money is being spent where it is needed. We are not at all convinced that these Bills represent the best way to give aid . In support of this I refer back to the excellent record we had after the war with the Colombo Plan and similar projects. We were able to provide money and technical expertise to a large variety of small projects. Small though the projects were, in every case they were important in themselves. Quite often they were very dependent on the person whom we placed there and on the expertise which this country provided with the money. Projects at the village level in the areas of real importance in South East Asia in particular were very greatly appreciated. Those projects, although small, were terribly important in themselves because the problems of poverty, health, and material deprivation in Asia are truly enormous in their scope. However, on an individual scale the problem appears small. In other words, material deprivation is enormous. In terms of actual human contact we find that most people, not only of Asia but also the rest of the world, in fact do not live in cities but live in villages. People in the Third World share much the same kind of problem. Aid should be identified and isolated completely to that area. The difficulty is that the world is not solving the real problems in this regard. The real problems are not tackled. They become worse as the years pass and much worse as the decades pass. Therefore, the fevers and the killing diseases such as malaria are now on the increase in the world. They are not on the decrease. The world is becoming a more unhealthy place, not a healthier place. A recent estimate claimed that 2,000 children now die every day in this world from starvation and a further 1,700 die every day from water related infectious diseases. This is the world which we claim is the world in which progress is being made. It should not be beyond the capacity of the world to solve these problems. However, they will be solved only when it is understood that massive dams, nuclear power houses, tyre factories, electrical appliance factories and factories which manufacture similar material goods of western society are simply not appropriate forms of aid and, indeed, are damaging. Before I came to this place I had a spell for a while as an adviser to a government in Thailand. I was located in north-east Thailand at that time and I was able to observe at first hand one of the first tributary projects of the once vaunted Mekong development scheme which honourable senators may remember from the past as being a scheme put up in world terms as something that would save Indo China. This first tributary scheme was the Nam Pong dam near Khon Kaen in north-eastern Thailand. As far as I could see it was looked at by engineers and everybody else but the people who were competent to study the effect it would have on the people of that region. As it happened, the only place in that area where one could put a dam was a big plain with low hills around it on which only a very shallow body of water could be retained. Unfortunately, that place was one of the few pieces of arable and reliable rice land in the whole region. It had been settled by families who had been there for many generations, possibly centuries. These people had farmed the land year after year, decade after decade. They were thrown off their land. They were not given satisfactory land in compensation; they were given small amounts of money. That scheme which in the end provided electric power for one or two small country centres and which, I understand still is not operating at full capacity, was an international disaster of the worst order. It was very expensive and it did nothing but harm. It is time we appreciated that that sort of thing ought to stop. Countries like Australia which are giving aid ought to be sure that they do not contribute to that sort of thing. We should have sufficient sense of responsibility to know that one does not solve these problems simply by throwing money at them. In fact , by simply throwing money, one quite often can cause problems, difficulties and inequalities in societies which are very grievous and very difficult and which do more harm than good. The need, plainly, is to build on the existing village society, which has its values and virtues, which is a firm and reliable structure, and has been for a long time. It survives remarkably well in spite of the repercussions of all the financial and political crises that occur in the Asian capitals. The Thais have a proverb: 'The rule of the government stops at the bamboo wall'. That means the bamboo wall surrounding the village. The insulation is there. There is no reason why anything that happens in the capital basically will effect that society. Yet , that society needs help. When we realise that, the requirements should become plain, even obvious, to anybody who takes a little trouble to try to understand them. Those 1,700 children who die every day from water related diseases die largely due to the fact that all sources of water supply, which are mainly wells, are permanently and irretrievably infected with a number of diseases. They are that way because it is not possible to provide economically the villages of the world , in which, I repeat, the majority of the people of this world live, with a roofing structure which will provide a safe, clean source of drinking water and cooking water to the people. This is because village houses almost entirely throughout the world are thatched in one form or another. In my experience, sufficient money has been provided in only a very small number of cases for the purchase of corrugated iron. However, this sort of construction has not worked for a number of reasons. Corrugated iron is intolerably hot when it is on a village roof. In addition, corrugated iron rusts out at the nail holes and is very difficult to fasten to bamboo purlines and roof materials which are normally found in a village house. It emerges then that a cheap means of putting a roof on houses of this kind, which, I repeat, are the most numerous residences in the world, boils down to the solving of a fairly simple problem-the provision of some kind of roofing that can deliver clean water to a simple storage tank with a single tap inside a house. This probably is the most important technical development the world could imagine at this time in terms of being of use to the greatest number of people. Yet, such a concept is neglected; one never hears of it. But such a development would probably save at least 1,000 of those 1,700 lives that are lost every day. The heat difficulty could possibly be overcome by using aluminium which is light and easy to transport and does not corrode. It could be carried in rolls on people's backs or in buffalo wagons. There is a need for something which can be carried by hand or by buffalo because, whether we like it or not, they remain the chief forms of transport in the world. A fastening, perhaps in the form of a hook with a rubber seal and a wing nut on top, could be used so that the material could be attached to bamboo purlins of houses of that sort without tools. I believe that such a concept could completely transform the health problems for the majority-I repeat 'the majority'-of the human race. Yet, it is not done. I suggest to the Government that maybe here is one area where there is a special responsibility. Can we not get a task force of Australian experts- perhaps we could engage one of our aluminium manufacturers-at least to look at this problem? This is something big that we could do. Basically it is a simple problem which should not defy solution. I think it should be given a very high priority. I hope that I have convinced honourable senators that it is a problem of tremendous importance against which the development of nuclear power, microchip technology and so on are minuscule in human terms. These things are really not important to the majority of the human race although they may seem important to us. The Australian Democrats believe that now our economy is improving we should be prepared to give more in overseas aid. We may feel we have problems in this country. We do have problems in this country but those problems are not important when they are contrasted to the needs of the Third World. It is not good enough for us to believe that we should have things that other people should not have. There is no difference whatsoever in the relationship we have with Third World peoples and the relationship we have with the people of Melbourne or Sydney. Yet, we do not take the view that the disadvantaged people in our own society should continue to be disadvantaged to the point where their children die in large numbers every day. Why then can we not construe this a little further and be of some real assistance to people in other countries where those things do happen? In 1971, which is a fair while ago, the United Nations called for developed countries, including Australia, to give 0.7 per cent of gross domestic product as official development assistance. We got up to 0.65 per cent, to our credit, in 1975 under a Labor Government. Our allocation, however, slipped to 0.48 per cent this year, which I think was a slight increase-there, again, I commend the Government-on the figure for the previous year. Recently our rate of aid has fallen faster than that of any other donor country. Despite the domestic, social and economic crises Australia is experiencing we must be prepared to do better than this and help those in desperate need both in Australia and overseas. We cannot be content to make excuses. As I said, the worst excuse of all is that we do not spend our money properly, well and wisely; we give our money to somebody but we do not see that the money is spent on things that are most useful. My second point at this stage is that we need to change our priorities in dispensing the amount of aid we give and the way in which it is given. Too much of Australia's aid budget, which is $822m for 1983-84, does not benefit the poorest countries of the world, where it is most needed. Laos, Nepal, Ethiopia, Chad, Somalia and Mali receive little or no aid from Australia, despite their ranking amongst the 10 poorest countries. That is an indictment of our society and it is an indictment of those who determine our aid policies. It is not good enough that that should happen. Papua New Guinea, Indonesia, the Philippines, Fiji, Thailand and Malaysia, which are among the more affluent and best organised of the Third World countries, although they have problems, receive almost all our aid allocations. Although none of them is in fact among the 30 poorest countries in the world, we are cynically giving this aid for political purposes rather than giving it where the need is greatest. I ask the Government to look at the situation again with all honesty and try to change it, and if necessary fight a few bureaucrats who would have us do otherwise. I am not at all convinced that those people who are now determining how our aid is to be spent are capable or competent to do it in the best possible way. In fact, I am quite sure that they are not. I am informed by some of my advisers on this matter from the voluntary aid organisations, which I believe should be given more help, that 75 per cent of our total aid budget-some $621m-is given in bilateral aid from government to government. That highlights the sorts of problems I mentioned when I first got up to speak. It is not possible to have a situation in which the majority of people who need the aid will get it if it is given. It is in the interests of the members of the average Asian government, which comprises a class of people who got themselves up to the top of the heap by their boot straps, to stay there and to see that their children stay there. Having worked with these people as an adviser for a couple of years, Mr Acting Deputy President, I can tell you that that is so. It is not unnatural that it should be so. These people do not see a particular degree of responsibility to the total population of their country; they have never seen that. In the hills of Laos, when one gets up amongst the Meo tribesmen one finds that they will let a village that has lost its land starve to death rather than help it because they do not see that they have a responsibility in that regard. That just happens to be the way they are, but it should not be the way we are. If we do not recognise that fact, then we are conniving with them. We know what is right and proper; they may not do so. Perhaps there is an excuse for them; there is no excuse for us. The Australian Development Assistance Bureau, which is dispensing aid under the umbrella of the Department of Foreign Affairs, has allowed too much attention to be paid to Australian foreign policy priorities in determining aid. The countries I mentioned make that fairly plain. By contrast, I should like to look at one of the voluntary organisations. I will choose the Save the Children Fund, not for any particular reason but because it is a good example. This fund operates genuinely and properly in some of the poorest countries in the world. It operates in Ethiopia, Bangladesh, India, Laos, Nepal, Sudan and Lesotho. However, unfortunately, less than one per cent of Australia's overseas aid goes through the non-government organisations, which are dependent on raising money in the community. Yet those organisations are probably the most competent to judge where aid is best spent and the most competent to spend it rightly and properly and in a way which is independent of our other objectives. Our diplomatic objectives are obviously important, but I think they should not be considered with foreign aid as a sort of string or as a weapon to be used. That is a bad habit we ought to get out of. One of the real problems is that government to government aid usually ends up in infrastructure projects, such as building roads, which often help the wealthy more than the poor. What is the use of having roads in a societal area where people cannot afford motor cars or motor cycles and will not be able to afford them in the foreseeable future? In village areas most of the villages do not have a road leading to them and one gets to them by walking across the track between the paddy fields, or at best buffalo carts have access. The roads, of course, are useful to the wealthy. They are useful to government officials and they are useful for military purposes, but they will not help the people. Aid to governments-this has happened in several South East Asian countries-can be used for political oppression. Roads can be built to give the government more control over the population. Furthermore, giving this sort of aid tends to liberate other resources and governments which wish to use political oppression, such as sending armies to invade East Timor, have all the more advantage to do so. I am not really blaming the Labor Government; I think it has inherited a situation which it may not realise needs changing profoundly, and I am hoping it will do so. Unwittingly or not, the Australian Government in its present methodology is aiding the military campaigns of recipient governments and abetting the suppression of human rights. A clear case can be made for that argument in a number of countries. It seems to me that there is a very compelling case for the Government now to consider channelling a great deal more aid through non-government agencies such as the Save the Children Fund, which can give the assistance where it is most needed, free of the restraints of foreign policy considerations. I put this forward to the Government as a serious suggestion and as a matter of tremendous importance in world terms. I ask the Government also to think about getting together a task force of people, which could include some bureaucrats if the Government wishes-they have their value from time to time-but which would also include people from the voluntary aid organisations such as Community Aid Abroad and the Save the Children Fund. This task force could lay down a set of clear guidelines as to what kinds of aid projects the Third World needs most. Then it could come down to individual concrete proposals, perhaps such as the one I put up for decent roofing materials. Those proposals could then be analysed and discussed point by point and justified, with public input from everyone who knows, and there are many who know much more about it than I do. The Government could then come out and say: ' Here we have it. After a year of work this task force has said to us that these are the things that need doing. Here are the means to do it. This particular organisation knows what to do in this particular country. It has contacts there. This is to be done'. The final point might be made that if we say to a government, 'This is the way aid has to be dispensed', it will say to us: 'We do not want your aid'. That is not actually happening. The Netherlands does this sort of thing, for instance. It is very careful about the way it deals with project-oriented aid and it is finding receptive governments. Once a government knows that a country is determined to make its aid dollar tell, it will respect that country all the more. So I suggest to the Government that it should consider this suggestion. I know from conversations I have had that it will get tremendous willing support immediately from the voluntary organisations to get that task force going. Let the task force be practical. Let it not look at ideas and generalities and motherhood statements, but let it look at things that really need doing and islolate them. This country could perhaps make for itself a name of great honour in the world by getting down to giving those people the money and doing those things. Senator HILL(South Australia)(5.47) —The Senate is debating the International Development Association (Special Contribution) Bill, the International Monetary Fund (Quota Increase) Bill and the Asian Development Bank (Additional Subscription) Bill. I wish first of all to deal with the Asian Development Bank (Additional Subscription) Bill 1983. It was indicated by the Minister for Social Security (Senator Grimes) in his second reading speech that the purpose of the Bill was to seek parliamentary approval for Australia to take up its entitlement to subscribe to additional shares in the capital stock of the Asian Development Bank. Last year I spoke in some detail on the Asian Development Fund Bill. The Asian Development Fund is the soft lending arm of the ADB. Last year's Bill was concerned with the replenishment of the fund and the authorisation of an increase in Australia's responsibility from 5 per cent to 7 per cent. Both Bills raise the difficult subject of foreign aid, more particularly the role, form and volume of such a responsibility which Australia does or should accept. The Senate is aware of the Jackson Aid Review Committee inquiry into Australia' s foreign aid which is currently taking place. I for one am looking forward to the publication of that report. The Senate will also be aware that Australia's foreign aid contribution this year is 0.48 per cent of gross national product compared with 0.4 per cent last year and set against the 1983-84 Organisation for Economic Co-operation and Development average of about 0.49 per cent. I remind the Senate of the goal of 0.7 per cent called for by the United Nations in its plan for a new international economic order, a goal to which Australia acceded. The Senate will also be aware, and this reinforces the point made by Senator Mason, that 74.3 per cent of Australia's foreign aid is bilateral whereas 23.8 per cent is multilateral. The bilateral proportion is dominated by our aid to Papua New Guinea. Some 48.6 per cent of total bilateral aid goes to Papua New Guinea, or 36.1 per cent of our total aid program. That country particularly dominates our aid program, as was indicated also by Senator Mason. The Senate will be aware of the criticisms, particularly from non-government organisations, that aid is not sufficiently reaching those in need. By this Bill we are again exhibiting support for the concept of multilateral aid as opposed to bilateral aid, and particularly multilateral aid within our region. In promoting that approach we are somewhat in conflict with the approach of the United States of America which is tending to downgrade multilateral aid in favour of bilateral aid which, of course, allows greater influence in relation to choice of development projects and in the relationship with the donee state. In last year's replenishment of the ADF, the United States of America reduced its contribution from 22 per cent to 16 per cent. We helped to make up the shortfall. In more recent times there have been even more vocal objections from within the United States Congress. I have argued before that the very reason for the cooling of attitude in the United States towards multilateral aid, that is, having less ability to influence politically the donee state, is the very reason why we in Australia should warm to multilateral assistance. But this does however place a major responsibility upon the multilateral organisation such as the ADB in determining its priorities, in choosing between donee states, in determining which donee state should be entitled to soft loans, in determining the type of project it will finance bearing in mind the criticisms I have mentioned from non- governmental organisations, its evaluation of the success of projects financed and questions of that nature. The cursory and somewhat superficial assessment of the Bank and its undertakings as indicated in the second reading speech of the Minister for Foreign Affairs (Mr Hayden) wherein he states 'We have regarded it as an effective and efficient vehicle for regional co-operation and development' is therefore disappointing. The sort of subject which I thought might have been covered and which would have been worth while to cover is how the Bank is integrating its objectives with the development policy of individual developing member countries. A discussion on that subject would have been particularly helpful. For example, I note that this year the Bank sponsored a high level symposium on development strategies in Asia which seems to reflect a growing awareness of, being sensitive to, and responding to, national development priorities. The attitude of the Bank to human resource development is also obviously of great importance as more developing countries become aware of the need to develop human resources as an integral part of their economic development planning. The building up of human capital does not appear to have been a major priority of the Bank to date. However, I have noted that the Bank is now saying that it will switch from a project-oriented approach to training to an integrated one serving a wider range of training needs. That is perhaps encouraging. Having a developmental role with economic growth as its central factor one might ask whether the Bank has sufficiently recognised the need to avoid serious and irreversible damage to natural resources and the environment in such economic development. This is particularly so bearing in mind that developing member countries of the Bank tend to have rapidly growing populations with a need for food, coal, fuel and shelter, which invariably strains the supporting capacity of the local environment. The Bank acknowledges that this often results in overgrazing, deforestation, lack of water, and increased disease transmission . Again, it appears that this has not been a substantial concern of the Bank in the past, although now there are plans in train with the object that the environmental dimension will be viewed eventually as a routine and integral part of the project appraisal. That is pleasing. But possibly the most important question one might ask is whether the Bank is sufficiently aware of the need for socio-political reform within developing member countries to ensure that the benefits from economic development projects equitably benefit the communities as a whole. Of course, the question raises the delicate relationship between the Bank as a regional authority and its client members in wanting to see the benefits of economic development broadly spread throughout such communities yet recognising the desirability of respecting internal development goals. The Bank does now appear to be meeting this challenge reasonably well and it wisely looks to influence social change in economic terms. The 1982 annual report of the Bank states: While the bank recognises that economic growth is the central factor in its development role, it is equally aware that widespread poverty and inequitable income distribution can disrupt and even negate economic gains by leading to social or political instability. The bank aims, therefore, to combine employment creation and poverty reductions with economic efficiency and viability as major objectives in its development project. Criticism that may have been made of the Bank in relation to this matter in the past therefore appears not now so well founded. However, it is a pity that the Australian Government, in presenting this Bill to the Parliament-a government claiming to be concerned about socio-economic development in developing countries-did not discuss this matter. The Bank's strategy since the mid-1970s appears to have been, firstly, to concentrate its concessional lending in the poorer developing member countries; secondly, to emphasise investment in sectors which must benefit the poor, such as small farm agriculture and social infrastructure; thirdly, to identify and design individual projects in such a way that their social impact would be high; and, fourthly, to liberalise its modes of lending in suitable cases. Superficially, in any event, it appears to be matching its rhetoric with action . For example, during 1982, 98 per cent of the Bank's $US547m in ADF lending went to the poorest countries, to Bangladesh, Burma, Nepal, Pakistan and Sri Lanka. Bank finance projects for agriculture and rural development-where it can be best argued that project benefits go directly to the poor, excluding agro- industry-received 34 per cent of the total bank lending in that year. However, it is interesting to note that there was a marked decline in the share of lending for social infrastructure projects. This amounted to about 10 per cent of total lending compared with about 22 per cent in 1981. One might have thought that the Hawke Government would have attempted to explain this surprise to the Parliament. The Bank's explanation is that the figure should be read in conjunction with the sharp 60 per cent increase in bank lending to this sector in 1981. In 1982, however, the Bank made only four loans in the water supply and sanitation sector. One might have expected more. Also, in 1982, in supporting rural health service projects, only two projects were approved. Again, the number appears low. Perhaps it indicates that the Bank is finding difficulty in identifying the role of socio-economic development with economic development. The Bank will argue that its road improvement projects will provide considerable indirect benefit in access to numerous rural areas which are at present inaccessible. The Bank in its 1982 annual report states: These roads will provide outlets for small holder farm produce, decrease the cost agricultural inputs and allow greater mobility to people living in the project area. However, this raises the allegations that Australian aid projects are facing in the Philippines of being first used to reinforce the political colour of the incumbent regime. This is a matter to which the ADB will have to give its attention. But at least the Bank does appear to be aware of and wrestling with the inherent priority conflicts in this regard. Its recent study 'The Bank's Operational Priorities and Plans for the 1980s', indicates a growing enhancement of the Bank's role in reducing poverty. That study provides: First the bank's poverty reducing and employment creating efforts must not be confined to agriculture and social infrastructure projects, but should be incorported, wherever feasible, into projects in other sectors such as development banks and transport and communications. Second, close attention must be paid-especially in projects addressed to the needs of the poor-to sociological and cultural factors and, most importantly, to institution building to correct administrative and management deficiencies. Third, poverty issues should be made an important part of the bank's policy dialogue with its DMCs. In summary, the bank's objects should be to support an appropriate blend of growth, employment creation and poverty alleviation throughout its broad range of development activities. No one disputes that the Bank does not and cannot play a worthwhile role in financing economic development projects, but at a more difficult level as to how its funding is affecting social and environmental change, it appears that, at least, the Bank is recognising its responsibility in these areas and making real efforts. Its post-evaluation of projects appears to have been upgraded and is emerging as an important management tool for the future. The fact that in 1982 some 123 loan and technical assistance projects in 21 DMCs were reviewed to assess their environmental impact should be recognised. But the Australian Government should recognise also that difficulties exist for the future, some of which I mentioned last year. I am sure, for example, that the Senate would like to know the attitude of this Government to the ADB making loans to Vietnam. As I understand it, the ADB's position remains that conditions in the country do not provide a reasonable basis for new lending or for a revival of earlier projects. Does the Australian Government intend to take any action within the ADB to review that policy? Similarly, loans to Afghanistan were stopped with the Soviet intervention in 1979. As I said last year, that policy which was justified on safety reasons, conveniently fits American foreign policy. What is the Australian Government's attitude to that? India has indicated its intention in the future to resume soft loan borrowing which could rapidly exhaust the ADF. What is the Australian Government's attitude to that proposal? What is the Australian Government's attitude to China becoming a member of the Bank? If it does, what is Australia's attitude to the continuing membership of Taiwan? I remind the Senate that China appears to have unofficially applied for membership, but on the basis that Taiwan is expelled. The United States has supported China's admission but not the expulsion of Taiwan. I, and I am sure the Senate, would like to know of the Australian Government's position on that question. Is the Australian Government aware that the ADF is now virtually dependent on Japan, which some commentators argue suits Japan's economic regional strategies? Does the Australian Government, therefore, support or advocate the broadening of the base of support of the Bank and the fund? These are just some of the questions which, at least some, and, I believe, most in this Senate would have appreciated being addressed by the Government which claims in the Minister's second reading speech to attach particular priority to the needs of developing countries within our region. Some information on the Australian staff of the Bank, with its relationship with the Australian Development Assistance Bureau and with other bilateral and multilateral agencies , the suitability of the Bank's head office remaining in the Philippines in view of current domestic stress and the Bank's plans for a regional office in the South Pacific are just a few of many other questions which the Senate could reasonably have expected to be discussed in the speech introducing this Bill. Therefore, in welcoming the Bill and in expressing support for the Bank and its work, might I also register some disappointment at the somewhat shallow contribution to the debate that is provided by the Minister's speech. I have time to make only a few comments with regard to the two remaining Bills. To talk, on the one hand, of the regional Bank, the ADB and, on the other hand, of the Bretton Woods structures, the International Monetary Fund and the World Bank, is really to talk of chalk and cheese, simply looking at size alone. The authorised capital of the World Bank is about $71 billion. For its soft-arm window the latest replenishment was $12 billion. The IMF has a quota of $90 billion compared with the Asian Development Bank which has just doubled its capital to $16.3 billion, while the replenishment of the ADF totalled $4.1 billion. Not only their size but also their roles are very different. One might have argued that really they should have been dealt with separately. All that is in common is the cooling of the United States to both, the World Bank and the Asian Development Bank and more specifically, to the soft loan facilities of each, the International Development Association and the ADF. Also in common is the cursory way in which the Government has treated both in this debate, which unfortunately reflects the speeches made by Ministers Hurford and Keating at the annual meeting of the Board of Governors of the Asian Development Bank and the annual meeting of the IMF respectively this year. Unfortunately, neither appears to provide an in-depth analysis of the problems facing each and Australia's proposals for their solution. This can be compared with contributions of Ministers from other countries who addressed these bodies at such annual general meetings. Really, we know little of this Government's attitude to the problems facing the Bretton Woods institutions or the institutions in themselves. I remind the Senate that the World Bank-IMF combination now is concerned with the welfare of over three-quarters of the world's population. Never has there been a greater need for internationalism. Equally, never has there been a greater opportunity for the Bretton Woods institutions to contribute to the benefit of this massive section of the world community. But what has been a great disappointment to some of us has been that in the face of such a challenge and in response to temporary domestic economic pressures we have been witnessing a withdrawal from internationalism. As was put by the Far Eastern Economic Review in September this year: The need for statesmanship rather than narrow politicking has probably never been greater in the sphere of the international economy. So much has been achieved there since the war-and so much stands to be lost now or thrown away. The interdependence of the world economy can be shown no better than in the economic relationship between the United States and the Third World. During the 1970s, annual trade between the United States and the developing world grew from about $11 billion to $82 billion, to the extent that such countries now purchase about 40 per cent of United States exports. In addition, such countries now supply about 44 per cent of United States imports. One would have thought, therefore, that the importance of continued Third World development to the United States would be self-evident and the importance of the World Bank in contributing to Third World development, particularly with finance in relating to infrastructure growth, roads, bridges and dams that provide the economic backbone to developing nations would be obvious. Equally obvious, one would have thought, would have been the importance of a body such as the IMF to endorse and monitor responsible economic policies. What, of course, has happened is that Western industrial nations including Australia, have been unable to grasp the competitive challenge posed by Japan and the Asian newly industrialising countries such as South Korea, Taiwan, Hong Kong and Singapore, most, interestingly, with conscientiously planned economies helped by agencies such as the World Bank. Western industrialised nations have lacked the flexibility to compete in a relatively open world trading environment . In part, the response has been pressures against foreign development aid. Snubs administered to the United States by the emergence of Soviet client states in Africa and elsewhere and actions such as India's balancing act between the United States and the Soviet Union led to pressure, particularly on the United States, to curb its contribution to apolitical multilateral funding organisations. Notwithstanding that the IDA came into being from a United States Treasury proposal in 1959 reflecting, amongst other things, a 'growing feeling that aid should be channelled through multilateral agencies so that it would be less political and more effective in promoting development'. But, it is interesting that, from being out in the cold, suddenly with the need to rescue the Latin American debt crisis and bail out the United States banks, the importance of the IMF has again been recognised. The World Bank, however, remains out of favour but one suspects that its benefits will become more obvious when development stalls. These bodies are not most desirably seen as rescue organisations but rather as bodies able to make a positive future contribution to Third World economic development. I would have liked to have heard this Government dispel the widely held fears that World Bank activities in developing countries displace private sector initiatives. The evidence would suggest that without the World Bank and the IMF the environment in most Third World countries would be much less attractive to multinational companies and commercial banks. I would have liked to have heard this Government dispel the concern-in fact, it is the commonly held view-that the rate of return on projects supported by the Bank is low. According to a 1982 United States Department of Treasury study the rate of return is 15 to 20 per cent. I would have liked to have heard an assessment of the role the IDA has played in the economic development of India and the potential it could now play, if it were adequately funded, in the development prospects of China. A unique opportunity exists for the Western world to support the fundamental reorientation of China's development strategy taking place, for which China is seeking World Bank support. I would have thought it helpful to point out to the Australian public that 37 per cent of IDA loans now go towards financing agricultural and rural development projects, thus stressing poverty alleviation and raising the productivity of small farmers. One suspects that the United States now believes this to be a wrong direction and that the traditional emphasis should have remained on basic infrastructure as essential prerequisites to development. The Australian Government's view regrettably we do not know. These are just some of the questions that I would have liked to have addressed in this debate. It might have been too much to expect an analysis of some of the proposals for reform of the Bretton Woods institutions that are currently being floated but at least I believe we could have reasonably expected an assessment of these institutions, the difficulties they are presently encountering and the contribution they can continue to make. In conclusion, at least in bringing these Bills forward the Government is recognisng the importance of multilateral institutions and multilateral solutions to regional and world economic problems. This was a view which of course was firmly held by the previous Government and it is a view which I applaud. Senator WATSON(Tasmania)(6.12) —The Senate is debating cognately the International Development Association (Special Contribution) Bill, the International Monetary Fund (Quota Increase) Bill and the Asian Development Bank (Additional Subscription) Bill. The first authorises a special contribution to the International Development Association; the second increases Australia's quota to the International Monetary Fund; and the third provides for an additional subscription to the Asian Development Bank. The International Monetary Fund was an outcome of the 1944 Bretton Woods conference. It essentially provides support funding while its associate institution, the World Bank, specialises in the provision of loans for developmental projects. Prior to its establishment in 1961 it was thought desirable to have an institution such as the International Development Association to make grants rather than loans. But it has emerged as a lender of long term loans at artificially low interest rates. It is acknowledged as being one of the more successful instruments of assisting the low income countries. The problems that these developing countries face are fourfold-firstly, their low generation of income per capita; secondly, their high population growth rates; thirdly, their low level of savings; and, fourthly, generally their poor natural resources-hence the need for foreign capital and assistance. But the benefits of private enterprise investment in such regions are very marginal because of the slow rate of maturity of the benefits from investment, as investment in such things as health, education and nutrition do not provide yields or benefits which are quickly or readily converted into hard currency or into exports. Hence the contribution of the International Development Association has been quite valuable. Its lending criteria are that the recipient country should have a per capita income below a certain level and also that the country should have difficulty in obtaining access to normal borrowings. The third institution, the Asian Development Bank, emerged later-in 1966 in fact-in response to dissatisfaction at the lending patterns generally of institutions such as the World Bank, which tended to be more involved in infrastructure finance than in agriculture or in the special needs of Asia. Tonight I wish to draw attention to the reasons why such an increase in funding for these three institutions is necessary. In doing so I will concentrate on three related problems that our world is now facing: Firstly, there are the trade imbalances between the developed and the developing countries; secondly, there are the effects of the international recession; and, thirdly, there are the international debt and the role of financial institutions. At the meeting of the United Nations Conference on Trade and Development, UNCTAD VI, which was held in Belgrade in June this year, there was a difference of opinion as to the ways in which the developed and the developing countries saw the causes of the global recession. Parliaments of the world I believe do have an important role to play in the resolution of debt and in the securing of a stronger economic world. Parliamentarians must also be conscious of the fact that decisions taken in one country are rarely isolated from those in other countries. Politics aside , Australia for its part I hope will continue to play a constructive role in the development of UNCTAD's work program and its future activities in the financing of appropriate institutions. I have a few comments to make on trade imbalances. Individual countries must collectively unite and search for solutions to the international crisis. Nations are increasingly recognising that each is becoming dependent on the world community-a sick part in one sector has repercussions in other parts. Australia as a major trading nation has a vested interest in assisting quick recovery from this world recession. Sixty-five developing countries receive 60 per cent of their revenue from the export of commodities as such. One of the chief characteristics of this downturn in economic activity includes this low commodity crisis. But other factors are contributing, such as the intensification of protectionist pressures within the developing countries and inflation. To inflation I would also add an associative factor called social inflation. This is a new term but it is very significant because social inflation refers to the struggle of the disadvantaged in such countries to share in development. High interest rates are another problem. A one per cent increase in interest rates costs developing countries $US4 billion per year, so interest rates and the rise or fall of interest rates can have a traumatic effect on the problems affecting developing countries. Another factor is increases in prices of oil and manufactured goods. Another is the problem of heavy debt structures which have been aggravated by problems in capacity to pay and in the shortness of the term to maturity of loans. Of course this capacity to pay has been aggravated by receipt of low commodity prices. Another factor is high unemployment, particularly since the Second World War, with masses of unskilled who are left at the bottom of what can be termed the social structure, missing out on the fruits of development. There has been limited or negative productive growth. All these factors and more manifest themselves in issues such as disturbance to world trade, decreases in economic exchanges, restricted investment growth and the problems of debt and balance of payments deficits. International peace cannot be sustained while the economic position in the developing countries continues to deteriorate. Regrettably, the gap between rich and poor is widening. Economic development cannot be achieved without peace. Many of our Asian neighbours experience border stresses and incursions by belligerent powers. The raising of their living standards under such circumstances is quite remarkable and is to their credit. I point to countries such as Korea, Thailand, Malaysia and so on. The growth in their manufactured products-these newly emerging economic miracles-is creating problems and challenges for Australia. Another factor of great significance is the arms race. This must be stopped in the interest of economic development and world harmony. I think it is of significance that even some of the oil producing countries are suffering as a result of decreased oil volume and decreased prices. They have some debt problems associated not only with decreased oil prices but also increased costs of imported manufactured goods. Countries that are affected in this way include Mexico, Nigeria and Venezuela. They are all producers whose credit ratings are now very marginal because of excessive borrowings and the problems of commodity price reductions and import cost inflation. We in Australia are justifiably complaining about problems which have been inflicted on our nation as a result of the international recession but those difficulties are but a whimper compared with some of the intolerable sufferings of some of the people in the Third World where millions are afflicted by an increase in malnutrition and a deterioration of health standards. The big problem we are facing at the moment is the management of this huge debt problem. In fact the foreign debt of developing countries now exceeds $650 billion, and it is growing daily. The impact has forced debt countries to cancel essential development programs and, all too frequently, to lower standards of living. Individual countries cannot move unilaterally in, say, holding back raw materials in an endeavour to increase prices or, at the other end of the spectrum, to lower protection to the detriment of their own work forces in situations of gross over supply and limited demand. It is important that, through appropriate institutions, they act in concert. I believe it is regrettable that around the world most governments have not reached the target of 0.7 per cent of their gross national product for development aid. There appears to be a high degree of irresponsibility by some leaders who tend to over -borrow and to commit their countries to unacceptable levels of indebtedness. On the other hand, I believe that institutions which recklessly lend, following what might be referred to as the 'herd' instinct, are also equally culpable. The risk of a major international default is high. The world has been warned of the domino effect of a combination of significant countries failing at the same time . We are all aware of the debt problems of Mexico, Brazil, Poland, Yugoslavia, Romania, Equador, Chile, Cuba and Uruguay. But more recently, since August, and closer to home, a new emergency has spilled over into the Asian region. The Philippines is experiencing civil unrest. This has caused a drop in exports and the country is experiencing capital withdrawals. The interdependence of nations is reflected in the Philippines situation. This problem is now indirectly causing some difficulties to our close neighbour Indonesia. It is experiencing a new problem, a fall in its credit rating and an increase in the cost of money that it must pay for its borrowings. With three bank failures each week not uncommon in the United States, the problem of debt is indeed severe. Existing international bodies have been unable to meet the requirements for world development and have been unable to meet this crisis. Governments must seek to arrive at establishing a framework for negotiations between debtors and creditors, with interest rates reduced and maturities increased. Fortunately, much has been achieved to avoid a crisis by unprecedented co-operation among banks, governments and international agencies. What are the solutions? Some leading economists and politicians have called for a new economic order to ensure economic justice, to facilitate technological transfers, to improve dialogue and co-operation, to facilitate trade balances and to establish financial institutions appropriate to the needs, especially of the developing countries. Progress will indeed be slow while the world lives under a cloud of an unprecedented build up of arms and growing trouble spots around the world, encouraged by the widening mistrust between the super-powers. Nations naturally turn to UNCTAD as an organisation capable of finding solutions to world structural and trading problems. Developing countries themselves, for their own part, I believe, have a role to play in the control of demographic growth, respect for the rights of minorities, sound management resources and control of inflation. Clearly, countries, both developed and developing, will not be able to avoid careful domestic management involving difficult decisions in order to take advantage of the recovery that now seems to be under way in some industrialised countries. I commend the Bills to the Senate. Senator BUTTON(Victoria-Minister for Industry and Commerce)(6.27) —I thank honourable senators who have spoken in this debate on the International Development Association (Special Contribution) Bill 1983, the International Monetary Fund (Quota Increase) Bill 1983 and the Asian Development Bank ( Additional Subscription) Bill 1983 and for their general support of them. Without being in the least patronising, I thank honourable senators for their genuine concern and the bipartisan nature of the discussion which has taken place. It has been an informed debate. I think we can all be grateful for that because it does not often happen here. In closing the debate I refer the Senate to Budget Paper No. 9 and the foreword to that Budget Paper. It makes two significant points to which I want to refer. The first is the Government's commitment in this Budget and the increase in funds. Funds have increased from 0 .47 per cent to 0.48 per cent in terms of the ratio between overseas development aid and the gross national product. I concede that that is a modest increase. The Government would have liked to have done more but, in the budgetary circumstances with which we were faced, that was not possible. The second point to which I would like to draw attention in the foreword to that Budget Paper is the fact that overseas aid is now the subject of a review by the Jackson Aid Review Committee. The Jackson Committee will be reporting to the Government later this year. The emphasis of that Committee's activities is on the question of assistance to developing countries in our region. That Committee will report soon. The Government will, presumably, reach a decision about that report early in the new year. The PRESIDENT —The question is 'That the International Development Association ( Special Contribution) Bill 1983 be now read a second time'. Senator Button —Apparently it is a bipartisan view that it would be acceptable to the Senate if you were to put the question for all of the Bills at once, Mr President. The PRESIDENT —Is it the wish of the Senate that that course of action be followed? There being no objection, that course will be followed. Consideration resumed from 20 September 1983, on motions by Senator Grimes: That the Bills be now read a second time. Question resolved in the affirmative. Bills read a second time, and passed through their remaining stages without amendment or debate. Australian Citizens' Allegations: Drug Activities-Advertising of Senate Committee Positions-Outdated Registration Forms for Incorporation of Associations The PRESIDENT —Order! It being 6.30 p.m., in accordance with sessional order I put the question: That the Senate do now adjourn. Senator CHANEY(Western Australia-Leader of the Opposition)(6.31) —I do not wish to detain the Senate for very long, but I wish to raise on the adjournment a matter I raised with the Prime Minister (Mr Hawke) by letter dated 6 July this year. On the day before that, I had representations from a young man and a young woman who had recently returned to Australia from India and Sri Lanka. That young man and young woman put a series of bits of paper in front of me, some of which were papers which had been forwarded to the Prime Minister. They told me a story about their suspicions and concerns about international drug activities and other criminal activities. They told me a story about their view that the Australian consular officials had not properly responded to their requests for assistance and, indeed, had behaved in a way which put them at risk. They told me that they were not satisfied with the way in which the information they were trying to provide to government was being received, and they were also concerned about a personal matter, namely, the recovery of a yacht in which they had sailed from Australia to the port of Cochin. In putting these matters down on the adjournment, I should like just to mention that normally when people make representations of this sort to me I would not make them public. Apart from anything else, they go possibly to the personal security of the people concerned as well as to their privacy. In this case, however, the people who came to see me have made an effort to interest a range of authorities in the matters about which they are concerned, and they have, in trying to follow this through, used the Freedom of Information Act to recover some of the papers which have gone in. Among other things, they have published the letter which I wrote to the Prime Minister on 6 July. So the matter has ceased to be one of great privacy and I raise it because I have not had a response from the Prime Minister, or in any sense a substantive response, and I am concerned as to how this matter has been handled. I should like to read the letter I wrote on 6 July, which will put more shortly than if I were to keep chatting about them the matters that I raised with the Prime Minister. The letter reads: I have received representations from Mr Brian Maxwell Milgate and Ms Alison McGuinness relating to matters which have been dealt with by the Department of Foreign Affairs in India and Sri Lanka and which touch on allegations of illegal activities centred in Cochin. Ms McGuinness has written to you- that is, to the Prime Minister- from Colombo on 24 June. A number of other documents have been submitted by them jointly to the Department of Foreign Affairs. The specific matter which has been raised with me is to enquire what they might expect to be done by the Department to help them recover their assets from Cochin and in particular, the yacht '' Tiger Rag''. I am raising the matter with you rather than the Minister for Foreign Affairs because you are already involved and because I think a number of your Ministers should be concerned about the matters raised. Both Mr Milgate and Ms McGuinness have confirmed that they are happy to provide detailed information to the police or any departmental official and have also advised me that they are making material available to Interpol on the drug trade through Cochin. In light of the sorry history of drug investigations and the frequent allegations of corruption and ineptitude I am concerned that they have an opportunity to provide all relevant information to a representative of your administration who can be relied upon to follow the matters through in an appropriate manner. I would be grateful, therefore, if you would through the appropriate Ministers, arrange for me to be advised: (a) what assistance, if any, is available to them with respect to the recovery of their property; (b) what is the appropriate body or person to whom they should provide information within Australia; (c) whether the complaints about the assistance received by them so far are justified. In retrospect, I suppose that in that letter there is a heavier emphasis on the recovery of their property than might have appeared warranted in the light of the very wide allegations they made and their suspicions of international drug smuggling, and so on. Clearly I was referring all those matters to the Prime Minister, and he had received other detailed information. The only response I have had was a letter dated 22 July, which was signed by Mr Lionel Bowen, the Minister Assisting the Prime Minister, in these terms: The Prime Minister has asked me to reply to your letter of 6 July 1983 on behalf of Mr B. M. Milgate and Ms A. McGuinness, concerning the recovery of their yacht 'Tiger Rag' from Cochin. Mr Milgate's and Ms McGuinness' letter to the Prime Minister was drawn to the attention of the Minister for Foreign Affairs, the Hon. Bill Hayden. I have, therefore, forwarded your representations to Mr Hayden with a request that he co -ordinate a reply to you on behalf of the Government. Yours sincerely. Last week in Perth a rather dramatic story appeared in a newspaper known as the Western Mail. That referred to Western Australian links in a spy and drugs riddle and to an allegation that there had been a seizure of a $250m cargo of hashish off the United States coast. Summarising the story, it suggested that this followed the arrest of a boat which had been identified in the material provided to me and to the Government by the couple whose names I have mentioned. The article indicates that the young couple have been pretty active in trying to follow it up, and on their account they have been in communication with authorities both within Australia and internationally. They had been told that the information they gave had been passed on to the Australian Federal Police and they had understood that it would be sent internationally. Because there was no response from the authorities in Australia, they sent details of their claims to drug enforcement agencies in the United States, Britain and France. Over the recent weeks they claim that the United States Coastguard Service has been in touch with them, obtaining from them the details that they have been able to provide. They are somewhat puzzled by that in the light of the fact that all of these details have been in the hands of government authorities for some time. I do not expect the Leader of the Government in the Senate (Senator Button) to have a full response for me, but I should like to make quite clear what my concern is in raising this matter. This couple were quite worried enough about their personal safety to change their names on their return to Western Australia . As I indicated to them, I had no way of telling whether their story was true or false. I had no means of investigating the quite detailed allegations they made. My real concern, quite apart from the recovery of their personal possessions, was to try to ensure that some appropriate authority would take charge of the information they provided and follow it through in a proper manner . As I said in my letter to the Prime Minister-this is in no sense a crack at the Government, which has only recently become the Government of Australia-we do not have a very good record of investigation in these areas. We are all familiar with some of the problems which have arisen. It is a matter of concern to me that when people believe that they have come across significant criminal activities, there ought to be some source to which they can go with confidence to have these matters followed up. In this case it may seem a little extreme to go to the Prime Minister, but it seemed to me that since the matter had already been put in his hands it was reasonable to send my correspondence to him and ask him to delegate it to some appropriate authority. I am not very impressed by the somewhat perfunctory reply I have had to date. I seek an assurance from the Government that these matters have been dealt with properly. I ask also that, if possible, it be indicated just what has been done to follow up these allegations. I place much greater emphasis on that now than on this question of the recovery of property. We have had great deal of talk in this Parliament and elsewhere about the corruption of Australian society. Much of what these people were reporting on was taking place outside Australia, but I am concerned about whether some proper action was taken. If such action was taken, I would like to know what it was. Senator TATE(Tasmania)(6.41) —I wish briefly to raise two matters. The first relates to a document which quite fortuitously came into my hands only about an hour ago, quite by accident. It is a staff circular of the Department of the Senate. It is circular No. 46 of 1983 and is entitled 'Structure of Offices'. Amongst other things, it says that following a decision by the Senate Appropriations and Staffing Committee to restructure the Department into various offices certain positions will be advertised in the Commonwealth of Australia Gazette, the Canberra Times and the Australian. That did not mean much to me except that I noticed under the heading 'Committee Office' mention was made of the Clerk of Committees, Class 11. That rang a bell, so I made a few inquiries. It turns out that Clerk of Committees is no doubt the correct title for the secretaries of standing committees, but probably one that is never used in this chamber. On making a few phone calls to other chairmen of Senate standing committees, I discovered that they had not been informed of this decision made somewhere within the Department to advertise the position of secretaries to their committees. The circular referred to is dated 1 November 1983, so that is well over two weeks ago. It is a staff circular and chairmen of committees have not even been given the courtesy of a communication of this proposal, which is quite a dramatic one. What was particularly galling for me as Chairman, amongst others , of the Senate Standing Committee for the Scrutiny of Bills was to turn the page to the heading 'Procedure Office' and find mention of Clerk of Committees, Class 11. I am informed that that is a reference to the secretaries of the Senate Standing Comittee on Regulations and Ordinances and the Scrutiny of Bills Committee. I say that it is particularly galling, Mr President, because as you will know, on the resumption of the Budget session, at the first meeting of the Scrutiny of Bills Committee on 24 August 1983 it was resolved: . . . that the Chairman write to the President of the Senate and request that he make immediate arrangements for the appointment of a permanent Secretary to the Committee, such arrangements to include provision for external advertising and consultation with the Chairman during the final selection process. In terms of that resolution I wrote to you, Mr President, and received a reply dated 29 August, the relevant part of which was: In this regard, it is relevant that Dr Uhr applied for and accepted the transfer on the basis that it is temporary. It was because of the temporary nature of the transfer that it was advertised only within the Senate Department, and the selection made from officers who applied on that basis. In other words, the indication from your office, Mr President, was that it was impossible to countenance the advertising of this particular position, even though it was the desire of the Committee that that be done. Having received that reply on 7 September, in lieu of a resolution, it was recorded in the minutes, amongst other things, that: The Chairman undertook to have further discussion with the President and to request that the position of Committee Secretary be resolved (as outlined in the Chairman's letter of 24 August 1983) at the end of the current period of sittings. Within my previous letter, there was a proviso for advertising the position. Quite by chance, as I say, we came across a circular which contains a matter of interest to all Senate committee chairmen. It is of particular interest to the Scrutiny of Bills Committee as it believes that, as with the Senate Standing Committee on Constitutional and Legal Affairs, the secretary's position ought to be advertised. Indeed, we have a preference for that advertisement to include a requirement of legal qualifications, but that is by the way. I raise the matter as one wishing to seek information as to how it was that that staff circular went out without the chairmen of the various committees being informed of this quite unusual and novel procedure. I raise very briefly a separate matter relating to some approaches that have been made to me in relation to incorporation within the Australian Capital Territory of certain associations. Voluntary associations, as honourable senators know, in most jurisdictions can apply for incorporation under various statutes or ordinances. Once that is done there becomes available to them the opportunity to take advantage of various provisions of the law. Therefore, the various documents that have to be filled in in order for them to attain that status are quite important. Because one is dealing with voluntary associations, perhaps without legal or other expertise available to them, it is important that the various forms with which they have to deal be in a very clear and easily understood form. In relation to these matters it has been brought to my attention by some voluntary associations within the Australian Capital Territory that the old forms are well out of date. It is their understanding that new forms have been drafted and that sample copies are being prepared within the particular division responsible for drafting these matters within the Attorney- General's Department. I believe that division must be the corporate affairs division. The necessity of these new forms is shown by the fact that at the present moment the associations are dealing with forms which are xeroxed, totally inadequate and misleading as to the existence of provisions and forms which are no longer part of the law. It is understood that these forms were drafted as early as February this year, but no steps have been taken to promulgate them or to bring them into the public arena for use by these voluntary associations. I certainly wish to be followed up the question of who within the bureaucracy is responsible for this inordinate delay which is causing difficulty to some 200 or 300 such associations which are registered every year. It seems to me that it is something which ought to be attended to expeditiously. Senator PETER RAE(Tasmania)(6.48) —I was both interested and concerned to hear what Senator Tate had to say in relation to the advertising of Senate committee positions. It had been my understanding that under the two preceding Presidents there had been established in the Senate a practice-established, I thought beyond any doubt-that in relation to appointment of committee staff, and in particular, committee secretaries, that there would at all times be consultation with the chairman of the committee who would as necessary report to the committee, and that there would not be the situation which had been the source of considerable irritation over a period of time of people finding that appointments and rearrangements had been made without their knowledge. I am conscious of and acknowledge the point made that there is a necessity to ensure that there is not politicisation of the staff of the committees of the Parliament. However, opposed to that there is also a need, which I thought had been determined, to ensure that there is consultation. I recall that when the appointment of the secretary of the committee of which I was chairman during the preceding parliament-the Senate Standing Committee on Finance and Government Operations-was being arranged, when out of some 80 applicants it had got to a final five or so, I was present at the interview of the final five and was able to report to the Committee in relation to that. Whilst I did not at any time suggest that the Chairman of the Committee or the Committee as a whole should select and appoint, there should be consultation and it was my understanding that that would happen. I can only say that that was the view of the chairmen of all of the standing committees. It was a unanimous view, a view which I understood was accepted and which I understood was put into practice. It would be regrettable if that did not continue, and if any of the correspondence passed in relation to that matter is of any assistance in relation to this matter, then I would be happy to seek the approval of those whom I represented when I was involved in the correspondence to make it available. Senator BUTTON(Victoria-Leader of the Government in the Senate)(6.51) —Mr President, I am not able to offer any enlightenment on the matters raised by Senator Tate and Senator Peter Rae but Senator Chaney did advise me of his intention to raise a matter relating to Mr Milgate and Ms McGuinness. I have been able to obtain some information, not all of which I think thoroughly deals with the concerns which Senator Chaney expressed. There are really two issues- first, the way representations concerning narcotics made by Mr Milgate and Ms McGuinness to Australian consular officials in India and Sri Lanka were handled, and secondly, the disposal of their property including the yacht which bore the name Tiger Rag. Regarding the first matter, I am advised that when complaints or information were passed by Mr Milgate and Ms McGuinness to the consular officials in India and Sri Lanka it was decided by the Department of Foreign Affairs that the matter should be independently investigated by a senior officer who had no responsibilities in the consular area of the Department. In the course of this investigation, an officer subsequently flew to Perth to give Mr Milgate and Ms McGuinness the opportunity to relate their story and their complaints in the fullest possible manner. At the end of a six-hour interview they both acknowledged that they had been given every opportunity to present their case. The investigation into this matter has now concluded and it has been determined that on no occasion did consular officials in India and Sri Lanka dismiss any written or verbal allegations that the complainants made concerning narcotics intelligence and on no occasion did they fail to pass on these allegations fully and promptly to the appropriate Australian and Indian authorities. The Department of Foreign Affairs has been passing promptly to the Australian Federal Police all allegations and information relating to narcotics that it has received since Ms McGuinness first contacted the Australian Consulate in Bombay on 21 April this year. Similarly, I am advised that there is no indication that Australian consular officials overseas rendered any less than the full consular support called for under the circumstances. I think that in relation to that matter Senator Chaney really couched his concern in terms of the need for an apparently appropriate authority to take charge in respect of the allegations or complaints made by these two people. On the basis of the information I have at this moment, it appears that as far as the Department of Foreign Affairs is concerned an independent officer was appointed to investigate the matter and on the basis of the instructions I have, all the complaints were conveyed immediately to the Australian Federal Police. I do not know what happened to them after that; I have no information about it. It may be that the Australian Federal Police was in touch with the United States authorities. It may be that the defects were rather in the failure of somebody from the Australian Federal Police or elsewhere to speak to the two complainants as the United States Coastguard did, and maybe it goes no further than that. If further information is sought on that aspect I will certainly endeavour to obtain it. Once again, it may be a question of the Australian Federal Police desiring to maintain anonymity in respect of any discussions it might have had with international authorities. On the question of the yacht, the Tiger Rag, I am advised that it was first explained to Mr Milgate and Ms McGuinness while they were still in India that the Australian Government is unable to provide physical protection for Australians and their property abroad. That remains the province of local authorities. However, Australian officials did make such inquiries and representations on behalf of the two concerned to the local authorities as were appropriate. I am advised that the couple entered into a private commercial arrangement with a boatshed in Cochin for the repair of the yacht, the Tiger Rag , and any dispute arising from this arrangement has to be settled by recourse to local law. I am further advised that included in a folder of papers addressed to the Prime Minister (Mr Hawke), the Minister for Foreign Affairs (Mr Hayden), Department of Foreign Affairs officials and Ms McGuinness's father was a copy of a letter signed jointly by Milgate and McGuinness, undated and addressed to the Foreign Affairs Department, which stated, inter alia: We suggest that 'Tiger Rag' can be scrapped and the remainder of our assets returned to Australia . . . In a further letter dated 13 June 1983 addressed to a Mr M. A. Menon, Superintendent of Intelligence, Customs Branch, Willingdon Island, Cochin, Mr Brian Milgate states: . . . this letter will give the authority and cover the necessary permissions regarding 'Tiger Rag' and her equipment under seizure by Customs Department. The Australian Government has been advised that 'Tiger Rag' is to be scrapped where she is. As far as Foreign Affairs officials can determine, this decision was made quite voluntarily by Mr Milgate and Ms McGuinness. So in respect of the yacht there are two items of correspondence-one addressed to the Foreign Affairs Department and undated, including the comment which I quoted, that Tiger Rag be scrapped and the remainder of the assets returned to Australia and, in corroboration of that, another letter dated 13 June 1983 in which the Superintendent of Intelligence at Customs House in Cochin is advised that this decision in the undated letter has already been communicated to the Australian authorities and that it is the intention of the owners that the boat be scrapped where she is. That is the only information with which I am able to assist Senator Chaney at this stage. I share his concern, as I think every responsible citizen would, that these two people had gone to the lengths of changing their names and so on in order to avoid any possible victimisation as a result of telling their story, and that there did seem to be a greater courtesy in the United States Coastguard than perhaps in the appropriate Australian authorities, though that may not necessarily be a fair judgment on what took place. As I have indicated, Senator Chaney indeed said that in his view now the question of the recovery of property was subordinate to those other matters and I think the material which I have been able to give regarding the recovery of property issue is fairly conclusive. Senator Chaney —Will you follow up whether any effective action was taken with respect to the allegations about drugs and so on, because that is not at all apparent? Senator BUTTON —The honourable senator will appreciate that it may be one of those spooky areas where it is intended to be secret. Senator Chaney —But we need to know and you need to know, I think, whether it just ran into the sand or was dealt with in a proper way. Senator BUTTON —I think that the Department of Foreign Affairs has seen that it was dealt with as expeditiously as possible and so on. But I will follow up the remaining area of concern and see whether I can obtain the appropriate answer. The PRESIDENT —Before I adjourn the Senate I shall try to shed some light on the matter that was raised by Senator Tate and was added to by Senator Peter Rae. As I understand it, the history of the matter is briefly as follows: As a result of a meeting of the Senate Standing Committee on Appropriations and Staffing, which was chaired by my predecessor, Sir Harold Young, there was a reorganisation of the senior structure of the Senate staff. As a result of that reorganisation four distinct offices were created within the Department of the Senate. Arising from that reorganisation other positions were created within the Department of the Senate. That reorganisation reflected the new structure of the Department arising from the creation of the four distinct offices. That new structure basically involved the reclassification of a number of positions and also the creation of a few more positions. The new structure was put to me. I assure honourable senators that I gave it a lot of thought. After much consideration and a lot of discussion with the senior officers, I approved of it. From recollection, I approved of it about four or five weeks ago. I am told that in accordance with normal procedures the reclassified positions have been drawn to the attention of present staff, seeking from them any expressions of interest in the available positions, and that similar action for public advertisement is being completed this week. I understand that, whilst it is not a requirement, it has always been the rule that when there is a reclassification of positions those reclassified positions are advertised. That has happened in this case. Naturally, any staff changes that occur will depend on the results flowing from the applications that are received in response to the advertisements. At this stage it is only a question of the filling of the reclassified positions and it does not involve the personnel who may fill those positions. There is no proposal to change in any way the previous course of action that was adopted by my predecessors. I assure Senator Tate and Senator Rae that, in accordance with that longstanding practice, when staff changes might involve committee secretaries the views of committee chairmen will be sought. In other words, the position of committee secretaries has been reclassified from class 10 to class 11. It is not an automatic promotion for any of those people. If when the applications are dealt with it is proposed that there be an adjustment of committee secretaries the views of committee chairmen will be sought. That is as much light as I can throw on the matter at this stage, but I invite Senator Tate, Senator Peter Rae, or for that matter any honourable senator, to have a discusson with me and the Clerk on the subject at any time. Question resolved in the affirmative. Senate adjourned at 7.04 p.m. The following answers to questions were circulated: Question No. 16 Senator Bolkus asked the Minister representing the Treasurer, upon notice, on 21 April 1983: (1) Do the following anomalies exist under the Income Tax Assessment Act: (a) the maximum penalty for failure to keep sufficient records (section 262A(1) ) is $200 irrespective of the level of taxable income; (b) the maximum penalty for failure to lodge a return is $200 (section 223) whereas the maximum penalty for omitting income is double the tax payable on omitted income section 226(2)), which leads to a situation, where taxable income is high, in which taxpayers aware of the provisions might deliberately court prosecution under section 223 so as to avoid prosecution under section 226(2) in respect of the same matter; (c) the maximim penalty for failure to deduct withholding tax is $200 (section 221ZL(4A)) whereas the maximum penalty for failure to remit such tax which has been deducted is $1,000 or 6 months imprisonment (section 221ZN(2)), which means that taxpayers face a heavier penalty for deducting it in the first place; (d) penalties are expressed in fixed dollar terms and these are likely to lose their signifiance over time unless they are adjusted to take account of inflation, and such penalties are unlikely to differentiate adquately between less serious and very serious offences; and (e) section 226(2) imposes a penalty where a taxpayer, inter alia, 'includes in his return as a deduction expenditure incurred by him in excess of the amount actually incurred' and that the taxpayer would be liable for penalty only if he claimed a deduction in excess of expenditure actually incurred although he would not incur a penalty if he claimed a non-allowable deduction. (2) What action has the Government taken to assess and eradicate any such anomalies. (3) Would penalties expressed as a percentage of, for example, the delinquent tax, and not in fixed dollar terms as indicated in 1(d) above, differentiate between different offences and maintain their real impact over time. Senator Walsh —The Treasurer has provided the following answer to the honourable senator's question: (1) and (2) The Government realises that, with the passage of time, some of the penalties contained in taxation laws have lost their effectiveness. The Government expects to receive the results of a general review of the whole range of taxation penalties soon. When that is received the Government will give careful consideration to proposals for upgrading relevant penalty provisions. (3) Yes, but a number of penalties prescribed in the taxation laws are already expressed as a monetary amount plus a percentage of the tax avoided. For instance the penalty prescribed for the offence of making a false return or statement is a maximum fine of $200 together with a sum not exceeding double the tax attempted to be avoided. Question No. 64 Senator Bolkus asked the Attorney-General, upon notice, on 22 April 1983: (1) How many prosecutions under section 260 of the Income Tax Assessment Act are currently before the courts. (2) How many prosecutions have been considered under the above section. (3) How many have not been proceeded with because of the inadequacy of the section. Senator Gareth Evans —The answer to the honourable senator's question is as follows: The strict answer to each of the honourable senator's questions is 'nil' as section 260 does not create an offence. The following information is provided, however, with a view to assisting the honourable senator. Section 260 is a general anti-avoidance provision. The section makes void, as against the Commissioner, any contract, agreement, or arrangement that has the purpose or effect of avoiding the liability of a person to pay tax. The section does not apply to any contract, agreement or arrangement made or entered into after 27 May 1981. Part IVA of the Act contains the general anti-avoidance provisions that apply to schemes entered into after that date. Section 260 was construed by courts as not affecting the view expressed by the House of Lords in Inland Revenue Commissioners v. Duke of Westminster that ' every man is entitled if he can to order his affairs so as that the tax attaching under the appropriate Act is less than it otherwise would be.' As a consequence, the section has not frequently been found to justify contested assessments. The Commissioner's reliance on the section has been recently upheld by the Supreme Court of Western Australia in relation to a scheme involving the sale of a medical practice to unit trusts (Watson v. Federal Commissioner of Taxation 83 ATC 4336 and Gulland v. Federal Commissioner of Taxation 83 ATC 4352 ). I have been advised by the Commissioner of Taxation that there are no statistics relating to the number of matters in which the assessor relied upon section 260 in making the assessment or in respect of which an assessment might have been issued for a greater amount had the courts given section 260 a wider field of operation. He estimates that there are currently 4000 cases subject to litigation before the courts or the taxation boards of review where the nature of the issues in dispute could conceivably lead to the court or board being asked to consider the application of section 260. It is not possible to provide figures in relation to the number of these cases in which the Commissioner will in fact rely upon section 260 to support the assessments. Question No. 184 Senator Maguire asked the Minister representing the Treasurer, upon notice, on 19 May 1983: (1) How many taxpayers (broken down into available income brackets) obtained the dependent spouse rebate for (a) 1981-1982, (b) 1980-1981 and (c) 1979-1980. (2) What proportion of the total number of taxpayers in each bracket do each of these taxpayers represent for the above years. (3) What proportion of the total cost of the dependent spouse rebate went to people earning more than $30,000 in (a) 1981-1982, (b) 1980-1981 and (c) 1979- 1980. (4) What was the total cost to the Budget of the dependent spouse rebate in (a) 1981-1982, (b) 1980-1981 and (c) 1979-1980. Senator Walsh —The Treasurer has provided the following answer to the honourable senator's question: (1) and (2) The available statistics relate to taxable and non-taxable individuals with rebates for dependent spouse or daughter-housekeeper included in returns assessed within 12 months of the year of income. The relevant statistics for the 1981-1982, 1980-1981 and 1979-1980 income years are summarised below. (a) 1981-82 INCOME YEAR Number with rebates as Number with percentage rebate for of total dependent number of spouse or tax payers daughter in each Grade of taxable income housekeeper grade $ $ Percentage TAXABLE Under 6,000 19,816 2.9 6,000- 8,999 78,657 8.0 9,000-11,999 125,058 11.9 12 ,000-15,999 300,058 20.4 16,000-21,999 391,555 30.9 22,000-31,999 220,398 38. 8 32,000 and over 48,422 29.0 Total Taxable 1,183,964 19.1 NON-TAXABLE* 93,915 7.1 TOTAL 1,277,879 16.9 * Classification by grade of taxable income is not available (b) 1980-81 INCOME YEAR Number with rebates as Number with percentage rebate for of total dependent number of spouse or taxpayers daughter in each Grade of taxable income housekeeper grade $ $ Percentage TAXABLE Under 6,000 23,434 2.9 6,000- 8,999 98,687 9.1 9,000-11,999 201,871 15.4 12 ,000-15,999 369,889 26.5 16,000-21,999 337,138 35.9 22,000-31,999 130,713 39. 0 32,000 and over 25,907 24.4 Total Taxable 1,187,639 19.9 NON-TAXABLE* 89,473 6.7 TOTAL 1,277,112 17.4 * Classification by grade of taxable income is not available (c) 1979-80 INCOME YEAR Number with rebates as Number with percentage rebate for of total dependent number of spouse or taxpayers daughter in each Grade of taxable income housekeeper grade $ $ Percentage TAXABLE Under 6,000 31,672 3.5 6,000- 8,999 125,745 10.3 9,000-11,999 278,994 19.3 12,000-15,999 363,348 30.6 16,000-21,999 245,400 37.8 22,000-31,999 70,517 35 .3 32,000 and over 14,393 20.5 Total Taxable 1,130,069 20.0 NON-TAXABLE* 69,441 5.3 TOTAL 1,199,510 17.2 * Classification by grade of taxable income is not available (3) Of the total cost to the Budget of the dependent spouse and daughter/ housekeeper rebates, the percentage in respect of those taxpayers with taxable incomes of $30,000 or more is estimated at: (a) 1981-82 5.5 per cent; (b) 1980- 81 2.9 per cent; (c) 1979-80 1.6 per cent. (4) The total cost to the Budget of the dependent spouse and daughter/ housekeeper rebates is estimated at: (a) 1981-82 $893m; (b) 1980-81 $880m; (c) 1979-80 $642m. Question No. 236 Senator Hearn asked the Minister representing the Minister for Immigration and Ethnic Affairs, upon notice, on 2 June 1983: (1) How many people within the community unable to speak or read English are waiting to learn the language through the Adult Migrant Education Service. (2) What has been the increase of this backlog over each of the last five years . (3) What has been the increase of this backlog in each State in each year since 1977. Senator Grimes —The Minister for Immigration and Ethnic Affairs has provided the following answer to the honourable senator's question: Courses conducted under the adult migrant education program are divided into two phases, those for newly-arrived migrants and refugees (on-arrival program) and those for other than new arrivals (on-going program). All new arrivals are given the opportunity of participating in appropriate information and language courses, and classes are arranged in accordance with needs. The Department does not keep ongoing records of those on waiting lists. Information was, however, collected in 1981 and again at the end of September 1983. The following table indicates those people recorded as waiting to attend classes. As at 15.12.1981 As at 30.9.1983 On-arrival On-going On-arrival On-going program program program program New South Wales 537 1,838 294 4,462 Victoria 205 1,270 . . 2,295 Queensland . . . . 8 27 Western Australia 289 983 25 700 South Australia 37 265 130 1,744 Tasmania . . . . . . . . Australian Capital Territory 14 95 39 . . Northern Territory 61 245 . . . . 1,143 4,696 496 9,228 Waiting lists have limitations as an indication of the total number of people needing to learn English. For example the figures may vary from day to day depending on when particular types of courses are scheduled to start. As part of the administration of the program, most migrants register for courses and remain registered until they are offered a place in a suitable course; however, some people may not wish or be able to attend courses at the time they are offered a place. Question No. 247 Senator Messner asked the Minister representing the Treasurer, upon notice, on 3 June 1983: (1) Did the Treasurer refer on 30 May 1983 to a period of service being apportioned in order to determine that part of the proceeds of superannuation benefits falling after 30 June 1983 which is subject to the new 'super tax' arrangements. (2) Is the Treasurer aware that many superannuation schemes have periods of qualifying service which are pre-conditions to entitlements and in which partial or no benefits may accrue and that only after the completion of that pre- entitlement period does the superannuation benefit accrue to the employee; if so , and given these circumstances, will the starting date for the period of calculation of the period of service prior to 30 June 1983 be the date of the qualifying service or the entitlement date. (3) Will the starting date apply from 30 June 1983 or from the entitlement date , for those persons still serving the qualifying period as at 30 June 1983. Senator Walsh —The Treasurer has provided the following answer to the honourable senator's question: In my statement of 7 August 1983 I announced that the basic apportionment rule in relation to employees covered by employer-supported superannuation schemes will be the period, or aggregate of the periods, of employment to which the lump sum relates. Where this includes any period of qualifying employment prior to membership of a superannuation fund it will not be a test that the qualifying period be required by the fund rules. It may also include, in appropriate circumstances, any period of membership of an unsupported fund where there has been a transfer of accruing benefits between superannuation funds of different kinds. In relation to periods after 30 June, it may also include any period during which moneys were held in an approved deposit fund. In general where, either in the past or the future, an employee has fully preserved entitlements to lump sums when changing jobs or when moving from one fund to another, periods of employment or, where appropriate, membership of a fund and lump sums will both be aggregated when applying the before/after formula. Where none of the lump sum has been preserved, there will be no aggregation of either the amount of that lump sum or the period to which it relates. Where there is partial preservation, and transfer of less than the entire benefit from fund to fund, there will be aggregation with an adjustment related to the unpreserved amount. Question No. 268 Senator Macklin asked the Minister representing the Treasurer, upon notice, on 23 August 1983: (1) Are school fund and school council accounts, sporting funds, et cetera associated with schools exempt from the Bank Account Debits Tax Act 1982. (2) Are school parents and citizens associations, welfare clubs, ethnic parent committees, et cetera which provide for the children's schooling not exempt from this tax; if so, why is this the case. Senator Walsh —The Treasurer has provided the following answer to the honourable senator's question: (1) and (2) The Bank Account Debits Tax Administration Act 1982 exempt from the tax debits to cheque accounts of certain organizations including non-profit schools. Debits to a cheque account in the name of a non-profit school are exempt if they relate to transactions carried out by or on behalf of the association or body which conducts the school and the transactions are wholly and exclusively in furtherance of its objects. Cheque accounts of school support bodies such as parents and citizens associations, mothers' clubs, ethnic parent committees and similar auxiliary bodies are not exempt from the tax. Whether cheque accounts in the name of school funds, school councils or sporting funds are within the scope of the exemption for non-profit schools depends on whether the account in question is one operated by the association or body that carries on the school. The Government will shortly be reviewing the operation of the bank account debits tax. Representations have been received from school support bodies and other non-profit bodies seeking exemption from the tax and these will be carefully considered in the course of the review. Question No. 318 Senator Kilgariff asked the Minister for Resources and Energy, upon notice, on 6 September 1983: (1) Will the 9 cents per litre increase in fuel oil excise increase the price of fuel oil by 15 per cent to $96.14 per tonne. (2) Did the Government give consideration to the impact of this excise on the users of fuel oil when considering the excise in the pre-budget deliberations; if so, why is it necessary to re-examine the facts; if not, why is it now imposing an enormous cost burden on these industries. Senator Walsh —The answer to the honourable senator's question is as follows: (1) and (2) The Government has decided to reduce the excise on fuel oil, heating oil and kerosenes from 9.027 cents per litre to 1.872 cents per litre. This is equivalent to an excise of between $19.10 and $20.80 per tonne, depending on the gravity of the fuel oil. The changes, and the details of circumstances surrounding the changes, were announced by the Treasurer in his press statement No. 85 of 26 August 1983. Question No. 340 Senator Peter Rae asked the Minister for Industry and Commerce, upon notice, on 8 September 1983: (1) Has Australia been criticised in some international forums for its anti- dumping practices; if so, are these practices in contravention of an international code or memorandum of understanding to which Australia is a signatory; if not, then what steps are being taken to rebut any such criticism. (2) Will the promised 'fast track' anti-dumping arrangements for the steel industry contravene or be in accordance with Australia's international obligations. (3) When and where will the promised 'fast track' anti-dumping procedures for the steel industry be announced. (4) Will these 'fast track' arrangements apply to any other industry as well as steel; if so, why; if not, why not. Senator Button —The answer to the honourable senator's question is as follows: (1) Australia is a signatory to the General Agreement on Tariffs and Trade anti -dumping code. Our anti-dumping legislation and administrative practices accord with the principles contained in that code. As a code signatory Australia attends meetings of the GATT Anti-Dumping Committee which meets regularly to discuss dumping issues. These meetings provide the opportunity for members to review other countries' implementation of the codes. At such a meeting earlier this year Australia was requested to provide clarification of some aspects of Customs Tariff (Anti-Dumping) Act which was amended in 1982. At the next meeting of the Committee, later this month, Australia will formally respond to this request. (2) The 'fast track' anti-dumping arrangements for steel will not contravene Australia's international obligations. (3) There is no intention to announce the new 'fast track' anti-dumping procedures in relation to the steel industry. They will be activated by the steel industry authority when it is appointed and following the introduction of the steel industry plan on 1 January 1984. (4) No. A 'fast track' mechanism is appropriate in the steel industry because of the plan to operate for the industry after 1 January 1984 and in particular because of the involvement of the proposed steel industry authority. These circumstances do not apply for other industries. Question No. 384 Senator Peter Rae asked the Minister representing the Treasurer, upon notice, on 22 September 1983: (1) Is Ardmona, the manufacturers of 'Rippa' fruit juice drinks required to pay sales tax of 22.5 per cent; if so, what is the reason for this sales tax. (2) Are 100 per cent fruit juices based on imported concentrates free of sales tax. (3) Does this situation apply to the same products produced locally. (4) Why does this differential occur. (5) Will the Government review the situation with a view to removing this anomaly. Senator Walsh —The Treasurer has provided the following answer to the honourable senator's question: (1) Express provisions in the sales tax law preclude the disclosure of information about the affairs of individual taxpayers. The sales tax law provides that manufacturers of fruit juice products which do not qualify for exemption are required to pay sales tax at the rate of 20 per cent. Exemption applies to certain fruit juice products, other than carbonated soft drinks, which are not alcoholic and which consist of specified percentages by volume of juices of Australian fruits or vegetables. A limited range of exemptions also exists for some imported fruit juice products consisting of specified percentages of juices of New Zealand and Papua New Guinea fruits. In the August 1983 Budget the exemption for New Zealand fruit juice products was widened to give effect to Australia's obligations under the Australia-New Zealand Closer Economic Relations Trade Agreement (CER Agreement). (2) and (3) Generally speaking fruit juice products consisting of 100 per cent fruit juices reconstituted from imported concentrates are not exempt from tax. The only exception occurs in giving effect to the CER Agreement. Some fruit juice products consisting of 100 per cent fruit juices reconstituted from New Zealand concentrates, whether the fruit juice products are manufactured in New Zealand or in Australia, may qualify for exemption. Fruit juice products produced in Australia and consisting wholly of juices of Australian fruits or vegetables are exempt from sales tax. (4) and (5) There is not any anomaly in this matter in the sales tax law. Question No. 388 Senator Chipp asked the Minister representing the Minister for Foreign Affairs, upon notice, on 4 October: (1) Does the Minister for Foreign Affairs' answer to question with notice ( Hansard, 20 September 1983, p. 820) mean that the Government accepts that deployment and endorses the deployment of Cruise and Pershing missiles. (2) Has the Government made its own assessment of the situation using Australian intelligence agencies or has the Government relied on a United States assessment of the situation. (3) Has the Government considered alternative viewpoints such as that provided by the Centre for Defence Information in Washington, a research group staffed by retired senior US military officers, which stated in its publication Defence Monitor (v.XII No. 4, 1983): The fact of the matter is that the Soviet Union for more than 20 years has been able to devastate all of Western Europe with nuclear weapons just as we have been able to devastate the Soviet Union. The SS20 missile has made no substantial change in the nuclear threat to Europe. (4) Is the Government aware that the Centre for Defence Information has stated that not only are the Cruise and Pershing missiles unecessary but also that: The small size and mobility of cruise missiles will make it almost impossible to verify nuclear arms reduction agreements. The similarity between conventional and nuclear armed cruise missiles exacerbates the verification problem. Cruise missiles threaten and end to effective arms control. (5) What is the Government's assessment of these extremely serious critiques of United States nuclear policy which have been raised by eminently qualified United States military officials. Senator Gareth Evans —The Minister for Foreign Affairs has provided the following answer to the honourable senator's question: (1) The Government does not see a need for it to endorse decisions other countries make for their defence. In this case it understands the North Atlantic Treaty Organisation decision. The Government is strongly committed to progress on disarmament and arms control especially in relation to nuclear weapons. It has repeatedly stated its hope that the superpowers will be able to reach agreements in the START and INF negotiations leading to qualitative restraints and quantitative reductions in arsenals. In the INF negotiations the Government wishes to see a balanced, equitable and verifiable agreement which reduces and ultimately eliminates intermediate-range nuclear missiles on a global basis. It believes that an agreement which led to the elimination of an entire class of nuclear weapons would be a major achievement. The NATO deployments are scheduled to commence in December 1983. Initial preparations for these deployments are well underway. In the event that it is not possible for the United States and the Soviet Union to reach an agreement in the INF negotiations before deployment , the Government accepts that deployments will go ahead to counter the present Soviet advantage in intermediate-range ballistic missiles. Notwithstanding any such development the Government will urge that the superpowers should continue their efforts to reach an agreement on INF. (2) The Government assesses such issues independently on the basis of all available information and the views of its own advisers. (3) and (4) Yes. (5) The Government is aware that debate within NATO over NATO's nuclear weapons strategy is as old as NATO itself. Eminent persons on both sides of the debate have made substantial contributions to it. The views advanced by the Centre for Defense Information have their supporters but constitute only one side of the debate. For example, the Centre's view recorded in the third part of the question that 'the SS20 missile has made no substantial change in the nuclear threat to Europe' is not shared by the sixteen governments that constitute the NATO alliance. It was the Soviet Union's deployment of the SS20 that provoked NATO's response in the form of its decision to modernise intermediate-range nuclear forces through the deployment of cruise and Pershing II missiles in the event that negotiations to limit this class of weapons proved fruitless. Similar considerations apply to the Centre's views on cruise missiles recorded in the fourth part of the question. Cruise missiles constitute only one part of the superpowers' nuclear arsenals. Although it is generally conceded that cruise missiles pose problems of verification, many hold the view that these are not insurmountable. In SALT II for example, it proved possible for the superpowers to agree on arrangements, accepted by both sides, which imposed verifiable limits on air launched cruise missiles. Question No. 441 Senator Archer asked the Minister representing the Minister for Defence, upon notice, 18 October 1983: Has the Government a plan or projection as to the (a) maintenance; (b) expansion; and (c) reduction of each of the four categories as outlined in Question on Notice No. 440. Senator Gareth Evans —The Minister for Defence has provided the following answer to the honourable senator's question: The basis of our defence planning is the assessment of our strategic circumstances and objectives. Although the nation presently faces no prospect of military threat, the Government is committed to the maintenance of a capable defence force. In the light of our recently established strategic policy the Government will be reviewing the content and priorities of the Defence Force. This review in no way rests on a desire to cut back on our defence effort. The review will be founded on the conviction that peace-time resources will never be enough to meet all the Defence Force's requirements and therefore only careful analysis of these requirements against the Government's fundamental priorities will permit us to meet our responsibilities to the nation. The Defence Department has been directed to systematically examine our major defence capabilities so that the Government can see the options available to it and make any necessary changes. The Government's plans for the Permanent Defence Force, the Defence Reserve Forces and the cadets will be founded on this review process. Some decisions have already been taken. Decisions announced in the 1983-84 Budget or since include: (a) Permanent Defence Force: Reductions in Navy approved terminal strengths during 1983-84 of 450 associated with the phase out of naval fixed wing aviation and the loss of the carrier. An increase in Air Force terminal strength of 200 during 1983-84 to enable recruitment of extra technical personnel for FA-18 acquisition. A small reduction in Army terminal strength during 1983-84 of 173 associated with savings arising from internal restructuring. (b) Defence Reserve Forces: The Government plans to hold the strength of the Army Reserve during 1983-84 at about 30,000, the level set by the previous Government. There will be small increases in the terminal strengths of the Naval Reserve and the Air Force Reserve for 1983-84. (c) Australian Army Cadet Corps: The Australian Army Cadet Corps will be restructured along the lines of existing Navy and Air Force cadet schemes. Army cadet units will be based at Army Reserve depots rather than at schools. There is no planned reduction in the approved strength of the Army Cadet Corps. (d) Naval Reserve Cadets and Air Training Corps Cadets. There is no plan to reduce the approved strengths of either the Naval Reserve cadets or the Air Training Corps cadets. Senator Walsh —On 3 June 1983 (Hansard, page 1280), Senator Coates asked me, as the Minister representing the Treasurer, the following question without notice: Has the Minister representing the Treasurer seen a recent advertisement in the Australian Financial Review headed 'Tax Avoidance is alive and well in Australia '? I ask the Minister: Even if the Government has to live with the decision of this House last night to allow $570m of revenue to be lost, will the Government do something to kill the effectiveness of those who continue to rip off the vast majority of Australian taxpayers and who make a living out of encouraging others to do the same? Alternatively, if tax avoidance is no longer alive and well, can the government take action against Dr Clyne for false advertising? The Treasurer has provided the following answer to the honourable senator's question: The Commissioner of Taxation assures me that he is well aware of the type of tax avoidance advice peddled by Mr Clyne and has expressed confidence that the advocated tax avoidance tactics will prove to be ineffective. Mr Clyne's singular lack of success in his personal attempts to contest actions of the Commissioner before the courts and taxation boards of review are a matter of public record. In this atmosphere I believe that any person who sought to utilise the advice of Mr Clyne to avoid or evade his fair contribution to the revenue would run the very real risk of meeting the full force of the prosecution and penalty provisions of the income tax law. The Government believes that the most effective way to smash the tax avoidance industry is to ensure that the income tax law is safeguarded against tax avoidance arrangements. Accordingly, the Government announced on 28 April 1983 that it will, as necessary, employ retrospective legislation to ensure that tax sought to be avoided under any blatant tax avoidance scheme that comes to light during our term of office will be collected, irrespective of when the scheme was entered into. This policy will ensure that there will no longer be even the slightest possibility that a newly emerging scheme can have its intended effect. Furthermore, retrospective legislation that it becomes necessary to introduce will, as it applies to schemes entered into after 28 April 1983, apply to ensure that the amount to be recovered will be the tax that ought to have been paid at the time, increased to maintain its value in present day terms. That is a more effective and practical Government response to the promotion of tax avoidance than to attempt to ban advertising of the kind indulged in by Mr Clyne.