Friday, 2 March 1984 The PRESIDENT (Senator the Hon. Douglas McClelland) took the chair at 9 a.m., and read prayers. The Clerk-Petitions have been lodged for presentation as follows: Education To the Honourable the President and members of the Senate in Parliament assembled. The petition from parents representing the government schools in New South Wales respectfully showeth that: 1. They call on the Federal Government to re-affirm publicly that its primary obligation is to government schools. 2. They support the Federal Government's policy decisions which have reduced funding to wealthy private schools and which have broken the nexus between government and non-government school costs. 3. They endorse the Federal Government's opposition to the provision of a 'base grant' to all non-government schools. 4. They ask that the Federal Government create a general recurrent resource base which is adequate for government schools through the provision of increased recurrent funding. 5. They call upon the Federal Government to negotiate agreements with State/ Territory Governments which will ensure a planned program of improvements in government schools throughout the coming decade. And your petitioners as in duty bound will ever pray. by Senators Peter Baume (from 101 citizens), Childs (from six citizens), Gietzelt (from 80 citizens), Richardson (from 33 citizens) and Scott (from 19 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 Bjelke-Petersen (from 16 citizens), Elstob (from 28 citizens) and Harradine (from 70 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of certain elected representatives and officers 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. by Senator Scott (from 102 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 utilising chiropratic 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 chiropratice services are included in Medicare when it is introduced. by Senators Peter Baume (from 62 citizens), Richardson (from 21 citizens) and Scott (from 39 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 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 utilising 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. by Senator Macklin (from 40 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 Senator Peter Baume (from 27 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 to be given in confidence to the Australian Government prior to a request for entry. And that foreign warships and aircraft that carry nuclear weaponry be 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 Macklin (from 118 citizens). To the Honourable the President and members of the Senate in Parliament assembled: This petition of the undersigned citizens of Australia respectfully showeth that the reduction in the subsidy to tertiary student residential colleges of twenty-five per cent announced in the Federal Budget will: 1. Increase the financial hardship already being experienced by Australian students. The cut in subsidies to colleges will undoubtedly increase fees for that accommodation in 1984. Many students will be forced out of teritary education as they will not be able to meet these increased costs particularly as the Tertiary Education Assistance Scheme only gained a maximum increase of $2.80 per week in the Federal Budget. 2. Decrease access to education for country students. Many country students live in college accommodation either to attend tertiary institututions in the metropolitan area or in regional centres. The cut in the subsidy to residential colleges will even further disadvantage this group of students who already have comparatively low participation rates in tertiary education. Your petitioners therefore call upon the Senate to ensure: (1) That the full subsidy to student college accommodation is immediately restored. (2) That the Federal Government assume financial responsiblity for all student college accommodation to prevent the planned closures of colleges in Victoria. (3) That two student representatives are appointed to the committee of the Commonwealth Teritary Education Commission reviewing student housing. (4) That new forms of college accommodation are investigated which would be more appropriate to the needs of the current student population, i.e. accommodation appropriate for students with dependent children. And your petitioners as in duty bound will ever pray. by Senator Macklin (from 45 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth: We have become the innocent victims of your Government's Medicare scheme. We are forced to pay 1 per cent of our wages only to receive less per capita benefits than the people of other states. Without canvassing the rights or wrongs of the dispute between the Federal Government and the State of Queensland the fact is that because of it over one million Queenslanders, who contribute to health funds, are being blatantly discriminated against compared with people in the rest of Australia. Because of the dispute over the introduction of Medicare, Queensland public hospital bed charges are $120 per day compared with $80.00 per day in the other states. This is grossly unfair. As it was the Federal Government which decided to introduce Medicare, we believe it is their responsibility to take action allowing health funds' rates in Queensland to be kept at reasonable levels. Your petitioners most humbly pray that the Senate in Parliament assembled, should use its influence with Government so as to avoid the discrimination (of $ 40 per day) against insured Queenslanders. And your petitioners as in duty bound will ever pray. by Senator Macklin (from 1,168 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 the 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 the 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 Sir John Carrick (from 38 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 freedom. It could also be a means of undermining the traditional family structure of our nation. Your petitioners humbly pray that the Members of the Senate in Parliament assembled: should delay the Bill and ask: That the Government set up a Joint Parliamentary Committee to examine: (a) the implications of the U.N. Covenant for public policy, the extent of Australian commitments, responsibilities and accountability in terms of the Covenant; (b) the full effects of the Sex Discrimination Bill 1983 for public policy in giving effect to the U.N. Convention. The Terms of Reference of the Joint Parliamentary Committee to be widely publicised and oral and written submissions sought from the interested organisations and individuals. And your petitioners as in duty bound will ever pray. by Senator Harradine (from 14 citizens). Petitions received. The PRESIDENT —I inform the Senate that I have received a letter from Senator Jessop resigning as a member of the Council of the National Library of Australia . Motion (by Senator Grimes)-by leave-agreed to: That, in accordance with the provisions of the National Library Act 1960, the Senate elect Senator Martin to be a member of the Council of the National Library of Australia on and from 2 March 1984, for a period of three years. Senator CHIPP(Victoria-Leader of the Australian Democrats)(9.05) —Pursuant to contingent notice of motion, I move: That so much of Standing Orders be suspended as would prevent the Leader of the Australian Democrats moving a motion relating to the order of business on the Notice Paper. The matter which I placed on the Notice Paper and which was declared not formal by the Government is as follows: That, pursuant to Standing Order 358, there be laid upon the Table all documents containing advice from the Commissioner of Taxation to the Treasurer concerning the desirability or otherwise of the provisions contained in the Income Tax Assessment Amendment Bill (No. 5) 1983. I will speak briefly to this matter. This is certainly the most important matter that the Senate has discussed this week. Later today the Senate will be discussing the Income Tax Assessment Amendment Bill (No. 5) which, among other things, will impose a penalty on certain taxpayers who, having arranged a superannuation fund within their business-which means almost every small business person in the country-by some act or other infringe the provisions of this legislation. Let us assume that a family business had six or seven people in a superannuation fund-the directors and the senior employees-and, because of the recession, the number of people was reduced to one or two. Then, the fund is wound up. That is the the sort of circumstance that has happened almost every day in this country in the last ten years. Senator Grimes —We will not oppose this motion. Would you rather wait until the substantive motion to get your arguments across. Senator CHIPP —It would have helped had I been paid the courtesy of being informed of that. I will save up my passion for later. I put this forward as a dry run down the straight. Senator HARRADINE(Tasmania)(9.07) —I support the motion. Senator Chipp has said that this is the most important matter to have been discussed this week. The PRESIDENT —This is a motion for the suspension of Standing Orders. Senator HARRADINE —Yes, I understand that. I would like to see us do something this week. There was one matter last night perhaps but, apart from that, the Senate has done virtually nothing this week. I remind you, Mr President, and the Parliament of what occurred on the very last day of the last session when the gag motion was used against senators who were attempting to debate a very important piece of legislation, namely, the sex discrimination legislation. There would have been nothing to prevent the Senate from giving that mature consideration in the early part of this week when the House of Representatives was otherwise engaged. Therefore, I support Senator Chipp's motion so that we can at least do something this week. Question resolved in the affirmative. Motion (by Senator Chipp) agreed to: That intervening business be postponed to enable the immediate consideration of General Business Notice of Motion No. 35. Senator CHIPP(Victoria-Leader of the Australian Democrats)(9.10) —I move: That, pursuant to Standing Order 358, there be laid upon the Table all documents containing advice from the Commissioner of Taxation to the Treasurer concerning the desirability or otherwise of the provisions contained in the Income Tax Assessment Amendment Bill (No. 5) 1983. I thank the Senate for supporting me in this matter. As I have said, I shall be brief. This is not only the only really important matter that the Senate will discuss this week, but also an extraordinarily important matter. A moment ago I was describing a situation in which many small businesses find themselves after the recession. They have had a number, say, six, employees or directors in a genuine superannuation fund. Because of the recession, the number of employees has reduced, say, to two. The fund is finally wound up because of a bankruptcy or liquidation. At that point, the Income Tax Assessment Amendment Bill (No. 5) 1983 will now, if someone fortuitously has received some sort of 'execessive benefit'-and that is in the discretion of the Commissioner of Taxation-tax that person as if all of the incomes had been received in the year of income and would be taxed at the marginal rate. A simple example would be an ordinary taxpayer who has retired with very few assets, retired perhaps to a village in Gosford or somewhere with no assets to speak of, and who suddenly finds himself landed with a bill for about $50,000 or $60,000, having done absolutely no wrong and having conformed with the law right through. That is because-and now I come to the crux of this matter-this Bill will introduce one of the most evil things that a Parliament can introduce, that is, retrospective legislation. It will make the legislation date back to 1977. For some extraordinary reason-no reason has been given-a clause in this Bill dates the legislation back to 1977. That is notwithstanding the information given to the House of Representatives by the former Treasurer, Mr John Howard, with whom I discussed this matter last night. I refer honourable senators to a fine speech that he made in the House of Representatives on this Bill, as reported in Hansard at page 215. I have in my hand a document that was given to him in his capacity as Treasurer , on 9 February 1980, by the Commissioner of Taxation, Mr W. J. O'Reilly. I thank Senator Jack Evans for assisting me in gaining the former Treasurer's authority to quote from the document. This was written in 1980. It is a minute from the Commissioner of Taxation, in which, talking about this very matter of avoidance of income tax and misuse of the superannuation provisions, he says this to the then Treasurer, in paragraph 19: Because, in revenue terms, we have many larger tax avoidance problems in other areas and also because of the need to make certain that no avoidable difficulties are created for genuine superannuation funds, I would recommend that you await the comments of the Task Force before undertaking any corrective measures to deal with actual or potential misuse of the superannuation concessions. At the beginning of his minute, the Commissioner of Taxation said: It is true that the provisions are open to exploitation and there are some indications that misuse of them is on the increase. Frequently, however, it would not become apparent that a superannuation fund was being used for purposes not contemplated by the law until moneys in the fund are paid out. . . . . . . I hasten to add that the operation of the great majority of the internal funds is above reproach. That is not a politician talking. That is the Commissioner of Taxation, Mr O' Reilly, a man whose integrity is unquestioned and who has had a passion for pursuing taxes that have been avoided over the years. Here this great public servant is saying to the then Government, in 1980: 'It is not urgent. The great majority of these funds are genuine. There are other areas of tax evasion'. Yet the Bill about which we are talking today does not date the application of this vicious piece of retrospectivity back to 1980; it goes further back, to 1977, for some reason that has not been explained by the Government. I do not want to become emotional over this because it is a very difficult question. I was asked on a radio program the other day what was the proudest thing I had done in my 24 years in Parliament. I had no hesitation in answering that it is something which has made me very unpopular with many people. The proudest thing I have done is to defeat retrospective legislation in this Parliament. I believe it is one of the most evil concepts ever conjured up by a politician. It is exactly the way in which Adolf Hitler came to power. He was able to imprison and kill millions of Jews by retrospective legislation, by making acts that were committed at a certain time illegal or crimes against the state 10 years later. Retrospective legislation is a vicious tactic, no matter how noble its intention might be. The Government's intention is noble. It is trying to catch tax dodgers and people who abused superannuation funds in small businesses, but this will catch up so many genuine people. Admittedly, it gives a person the right of appeal, although it is a bit doubtful. But I am not clear on what grounds and to whom an appeal may be made. In any event, my knowledge of taxation matters is that once the Commissioner has exercised his discretion against a taxpayer the onus is virtually on the taxpayer to prove before a board of review that the Commissioner exercised his discretion incorrectly or unjustly . That is a very difficult proposition to put to a taxpayer, particularly a taxpayer in the circumstances I have described, who may have retired or be in small business and not be au fait with the law. All he or she may have done is follow the advice of competent lawyers or accountants. It also goes against the whole concept of fair play as we know it in Australia. This legislation is similar to somebody saying: 'There are 10 people over there . We know that three of them are murderers. Seven of them might be innocent but the way to solve this problem is to shoot the lot. Then we will get rid of the three murderers'. I do not think I am drawing an unfair analogy. The Government is virtually saying: 'Okay, this legislation may sweep up some innocent people who have retired and have done everything correctly, honestly and properly and devastate them in the twilight of their lives-by giving them a bill-- Senator Gareth Evans —Mystification. You should have been on the stage. Senator Chipp —When the Attorney-General was in opposition I admired him enormously for several of his qualities, not the least of which was the way in which he championed civil liberties. Yet I am now trying to make a serious speech about retrospectivity, which is the most massive assault on civil liberties that a politician could contemplate, and the Attorney-General, who apparently champions this concept, chooses to make fun of it. I wonder how he would have gone with the audiences on the university platforms from which I have addressed civil liberties meetings with him if he had espoused the concept of retrospective legislation. As I remember, the whole thrust of his career in championing civil liberties was to oppose such invasions of privacy and uphold the rights of the individual. Unfortunately, this debate is clouded because the Government is properly trying to catch tax avoiders. Not one member of the Senate would not support the Government in its geniune attempts to attack tax avoiders or tax evaders, but something is unjust in this whole concept, something that could bring chaos to people who have done the right thing all their lives. I believe the Senate is entitled to know-this is the thrust of my motion-whether the Taxation Commissioner today still holds the view that he held in 1980. If he still believes that the action in question is not presently a misuse of superannuation funds, I will still vote for the Bill. The Bill cuts out an anomaly and an abuse . I will vote for it without the retrospective clause. I believe all honourable senators are entitled to know whether there is justification for that clause which dates the operation of the Bill back to 1977. The only way in which we can find that out is to have this information before us. This is not something I do lightly. I know, having been a Minister, that the advice that a public servant gives to his Minister should in most cases be sacrosanct. It should not be something about which any honourable senator or member of the House of Representatives can just wave his or her arms, call for it and say: 'Right, we want that document'. If all confidential documents were made available for public scrutiny the kind of advice that public servants give to the Ministers will be necessarily low key. This is an area where we are asked to introduce legislation which will affect the lives of men and women. I believe we are entitled to know whether the Commissioner of Taxation today believes that circumstances have changed essentially since 1980 when he virtually told the then Treasurer this should not be retrospective legislation or it was not a gross misuse at that time of this section of the Act. Senator Dame MARGARET GUILFOYLE(Victoria)(9.22) —The Opposition supports Senator Chipp's motion seeking the tabling of information from the Commissioner of Taxation. Senator Chipp has outlined his reasons why he wishes this information. The debate in the House of Representatives on the Income Tax Assessment Amendment Bill (No. 5) 1983 outlined the former Treasurer's approach, particularly to the retrospective application of the provisions of the Bill. There was, from the former Treasurer, a note of the advice that had been given to him with regard to these schemes. There was, from the former Treasurer, the later advice that he had in 1983 from the Taxation Commissioner with regard to tax avoidance generally. For that reason the Opposition supports Senator Chipp in his quest to have more information before us as we debate the Bill. If we look at the debate on the Bill in the House of Representatives we see that satisfactory explanations for this provision were not provided by the Treasurer (Mr Keating). The Committee debate in that place was brief. If we are seriously to debate the question and the element of retrospectivity, to which we take exception and to which we will be moving an amendment, I believe it would be profitable to have advice from the Commissioner of Taxation on these matters before us. For that reason, quite briefly, I support the remarks of Senator Chipp. Senator WALSH(Western Australia-Minister for Resources and Energy)(9.23) —I will respond briefly and after I have finished, unless somebody else wants to speak to the motion, the Minister for Social Security, Senator Grimes, will move the adjournment of the debate on this motion. The reason is that it would be stretching the Standing Orders if I were to respond in detail whilst moving the adjournment motion, or so I am informed. Last night Senator Jack Evans came to see me. He wanted assurances on two questions: Firstly, where a beneficiary from a fund which has been wound up did not receive anything in excess of normal benefits the discretion of the Commissioner of Taxation would be exercised so that no additional penalty or tax assessment would be issued. I have been advised, althought I have not had a long time to go into it, that under the provisions of the Income Tax Assessment Amendment Bill (No. 5) 1983 such a person would not receive an assessment anyway . Secondly, Senator Jack Evans sought assurance on this matter: Where the beneficiaries of a fund or the manager of a fund had already been through bankruptcy proceedings, they would not subsequently be hit, post-bankruptcy, by an assessment for taxation. I hope I understood correctly the propositions he was putting to me. He was seeking at that stage an assurance in the Senate from me that the Commissioner's discretion would be exercised in that way. I told him I would discuss the matter with the Treasurer (Mr Keating). Subsequently, although it was not known to me until this morning, Senator Chipp gave notice of the motion which he has now moved. I understand that Senator Evans was given a letter last evening by the Treasurer regarding this matter. Senator Chipp —The previous Treasurer. Senator WALSH —No, he also got a letter from the present Treasurer on 1 March 1984. I have got a copy of it anyway. I presume he has a copy of it and a letter from the previous Treasurer. I was going to say something about that. At the time that that letter was written, which was February 1980, the Commissioner of Taxation, in the section that the honourable senator quoted, referred to more pressing tax avoidance or tax evasion matters that ought to be dealt with. That included what is now Part IVA of the Income Tax Assessment Act, the bottom of the harbour legislation which the Fraser Government ultimately introduced in 1982 and the Crimes (Taxation Offences) Act. The Commissioner's view at that time was that all those matters needed to be dealt with on a more urgent basis than the superannuation fund question which is the subject of the current debate or dispute. In 1982-83 evidence began to emerge that the numbers of these superannuation tax avoidance, evasion schemes at which the present legislation is aimed were far greater than had been previously believed as manifested by the New South Wales Supreme Court in the Kelly v. Raymor case and advice from the Federal Police. I am also advised that the conclusion of the Taxation Office is that following the announcement last year of changed arrangements for the taxation of lump sum superannuation payments there has been a rapid move to wind up the schemes at which this legislation is aimed. Senator Chipp also asked whether the Commissioner believes that it is necessary or that it is important that the effectiveness of the legislation be back-dated to 1977. I cannot respond to that now. What I will do is ask the Treasurer whether the Commissioner will supply a letter on that question. On the broader question of the tabling of all documents-I think Senator Chipp in his own speech acknowledged this-it is certainly not customary practice for every piece of advice given by the Taxation Office or by any department to a government to be made public by tabling in the Senate. I understand that a similar request was put to the Treasurer in the House of Representatives to table all the advice which had been submitted by the Commissioner on this matter and the Treasurer declined to make it available. Senator Dame Margaret Guilfoyle —He said he would think about it. Senator WALSH —He said he would think about it. Subject to the Treasurer being available-anybody who has ever had anything to do with these matters knows that it can be very difficult to get hold of the Treasurer for an interview or discussion when Parliament is sitting-I will take up the matter with the Treasurer and see to what extent, if any, he is willing to make the documents available, but with the highest priority being given to the request which seems to me to be quite reasonable that the Commissioner's written advice, as of today , on the relevance and importance of the provision back-dating to 1977 be obtained. I knew nothing of the motion which Senator Chipp has just moved until this morning. Although I did know, because Senator Evans came to see me late yesterday afternoon, I think it was, that a couple of matters concerned the Australian Democrats. But I have had no opportunity to take this matter up with the Treasurer and it seems to me that the best thing to do would be for a motion to be moved to defer discussion on Senator Chipp's motion until some time next week. Senator Chipp —In the meantime you will delay the Bill; you will not bring on the Bill? Senator WALSH —Of course not. Debate (on motion by Senator Grimes) adjourned. Debate resumed from 29 February, on motion by Senator Scott: That the resumption of the debate be made an order of the day for the first day of sitting after 1 May 1984. Senator MacGIBBON(Queensland)(9.30) —In my speech two days ago I was pointing out that the existence of the Live-stock Slaughter (Export Inspection Charge) Validation Bill provides a vehicle by which the Government can increase the meat inspection levy quite dramatically and savagely. It has increased from $1.80 to $5.40. We have the authority of the Treasurer (Mr Keating) that that figure of $ 5.40 represents only 50 per cent of the cost. So we now have a meat inspection levy of $10.80. The point I make is that that is a huge cost for the industry or the community to bear. It is not a matter of saying that the beef producers are paying only 50 per cent of that cost. The point is that the whole community must bear an unreasonably high charge. We, as producers, recognise that we must guarantee the quality of our product on the export market. We have no argument about the need for a meat inspection process. But we do have enormous resistance against and reservations about the very great cost that is involved. When the debate was adjourned two days ago I was putting in perspective the cost of $10.80 to examine a carcass hanging on a hook in an abattoir. It may be one of thousands that are seen in a day. The levy should be compared with the standard consultation fee that a medical practitioner receives for inspecting a patient, because he receives about the same amount-about $10 for a standard consultation-yet a figure of $10.80 is being charged by an inspector to look at one of thousands of carcasses hanging on a hook in an abattoir. There is no way that that figure can be justified. The abattoir provides the premises, lighting and equipment. All that the Government does is to send an inspector in a white coat to look at the carcasses. Live-stock Slaughter Bill The consequences of this meat inspection levy on the industry are profound. They are profound for the beef processors, the abattoirs. Some excellent speakers on this side of the House have outlined in concise detail the effect of this levy on the abattoirs of Australia. They have talked about how a dichotomy has developed between those involved in the export market as compared with the domestic market, because the export producers must pay the meat inspection levy, and how it is necessary, given the structure of Australia, that abattoirs deal with both the domestic and the export trade. The abattoirs have had a hard time. We have come through a major drought. Not the least of their problems has been the industrial relations problem with the meat workers, a matter for which the Australian Labor Party must accept the blame because it has encouraged some of the extreme union demands that the meat workers union has made. The consequence of this is that the productivity of meat workers is not as high as it could be. The net effect has been that the profitability of abattoirs in Australia is very poor. Despite what the Labor Party might think about profits, an organisation must make profits to stay in business. It must make profits to be able to employ people, and the abattoirs are manpower intensive industries. The concern that the ALP is showing for meat workers at present is negligible. It is about as much concern as Senator Gareth Evans shows for human rights. I say that seriously even though there are not too many meat workers in Queensland who vote for me, or other Liberal Party members. Most of them are Labor voters. On the other side of the coin, the beef producers are also having a hard time. Large areas of Queensland deal exclusively with the export market. All beef producers have suffered the effects of a major drought. It has had an enormous effect on all farm incomes. We have had to deal with major increases in farm costs-increases which are greater than those of many industrial enterprises in urban areas. Over the last 10 years we have had to cope also with a big shift in the traditional share of the profit from a beast. Once upon a time the grazier got a very much larger fraction of the profit from a beast. Now the grazier is getting the minor part and the major part is going to the abattoirs and the retailers. The share of the profit on a carcass that the producers once had has been very seriously circumscribed. For beef producers, as for abattoirs, if a profit is not made it is not possible to stay in business. Without profit people will move out of the beef industry into growing grain or, in the worst case, will just walk off their properties. I think it is a tragedy that the Labor Party simply cannot see the large picture of how the rural industries of Australia relate to the whole country. I am at a loss to see why the ALP must be so intensely anti-rural in all its policies and why every Labor primary industry Minister, of which Mr Kerin is the latest, must subscribe to this long line of failures in understanding where Australia's real interests lie. Senator CRICHTON-BROWNE(Western Australia)(9.37) —We are debating the Live- stock Slaughter (Export Inspection Charge) Validation Bill 1983 which seeks to overcome an alleged loophole in the 1979 Live-stock Slaughter (Export Inspection Charge) Act to enable the collection of export inspection charges in respect of stock passing through abattoirs since January 1983. This Bill arises directly from the Government's decision to increase by 200 per cent the fees charged for export inspection. The inspection charge, in terms of the real cost to the grower, for each head of cattle has risen from $2.40 to $5.40, for each pig has risen from 80c to $1.80 and for each head of sheep has risen from 24c to 54c. The real issue at stake here, in my view, is this Government's action in imposing these huge cost increases on an industry which is already in an extremely precarious financial position in order to pay for an export inspection service that is widely recognised as being hopelessly inefficient and in need of complete restructuring. Even this Government must be aware of the situation. The recently released Department of Primary Industry five-year corporate plan for the export inspection service points that out. It states: With the meat-processing industry in 1983 in a depressed state, inspection costs can be a serious burden to processors operating close to breakeven. Despite this the Government is determined to push ahead with these huge increases in inspection charges. Primary industry of course is still the most important single sector in the Australian economy. In the last two years it has accounted for around 43 per cent of Australia's export earnings, compared with, for instance, 26 per cent of total export earnings from manufacturing production . In 1982-83 meat exports were worth $1,678m, some 20 per cent of total rural exports. During that same year meat production was of the order of 2,107 million tonnes. Beef production alone was worth slightly in excess of $2,000m. Australia is the world's largest single beef exporter. In 1983 beef exports in terms of carcass weight were 782,000 tonnes. Our nearest competitor, Argentina, exported 425,000 tonnes in that year. In 1983 beef exports from our major competitors in the world beef market-Argentina, New Zealand, Uruguay and Brazil- plus our own beef exports totalled 2,214,000 tonnes. Australia contributed 35 per cent of these exports. Total production of these major beef producers, again including Australia, was some 7,119,000 tonnes carcass weight in 1983. Exports of 2,214,000 tonnes from these countries represented 31 per cent of the amount produced. By comparison in 1983 Australia produced 1,420,000 tonnes of beef of which 55.5 per cent or 782,000 tonnes was exported. I think that provides some perspective of the importance of the beef export industry to Australia. Australia is relying on the rural sector to lead the economic recovery but it cannot do so while this Government insists on increasing taxes and charges. In the same year the manufacturing industry will receive a 30 per cent increase in the real level of assistance which this year will total something like $257.2m. It is worth looking at the effect of such high levels of government assistance to manufacturing industry in terms of its effect on the rural sector. In 1979-80 the National Farmers Federation examined the effect of manufacturing assistance on the major rural industries. It found that during 1979-80 the additional cost of producing each head of cattle, incurred as a direct result of assistance to manufacturing, was $16. For every sheep the cost added by manufacturing assistance was $3.11. These figures are not absolute but they are highly indictative. The Industries Assistance Commission's annual report for 1982-83 estimates that the net subsidy equivalent of government assistance to manufacturing industry in 1981-82 was $5,843m. The National Farmers Federation estimated that some 80 per cent of this would be borne by the export sector of which the rural economy accounts for around 43 per cent. On these estimates the rural sector is bearing a cost burden of $2,009m to support a manufacturing sector which contributes 26 per cent of Australia's total export earnings compared with 43 per cent which is earned from the rural sector. The increase in export inspection charges will mean that during 1983-84 the Export Inspection Service will cost the meat industry an extra $17.9m. In a full financial year the total cost of the inspection service to the meat industry will be in the order of $40m. The meat processing industry is at the bottom of a severe economic trough and it simply cannot afford additional costs of this magnitude. During the past three years more than 40 abattoirs have been forced to close their doors. In the five years between 1977 and 1982 almost 14,000 jobs were lost in the meat processing industry because of the fall in total beef production over those years. Beef production fell from 2,081,806 tonnes carcass weight in 1978 to 1,523,272 tonnes in 1981-82, a drop of some 26 per cent. The last few years have also seen a decline in cattle herd numbers. 1978 to 1980 cattle numbers in Australia averaged 27.5 million. In 1981 the number of cattle dropped to 25.2 million and by 1983 there were only 22.5 million cattle in Australia, a fall of 8.5 per cent from the 1982 figure of 24.6 million. During 1984 the number of cattle is expected to decline by a further 2.2 per cent and the Bureau of Agricultural Economics predicts that it will be 1987 before herd numbers regain the levels of March 1983. This means that slaughterings will also decline especially after allowing for restocking after the breaking of the recent drought. Preliminary estimates by the Bureau of Agricultural Economics puts the number of slaughterings during 1983 at 8 million , more than 2 million below the average annual slaughterings of 10.34 million during 1978 and 1980. In 1982, 9.25 million cattle were slaughtered so in one year alone-from 1982-1983-the meat processing industry has seen a 15.3 per cent decline in the number of cattle slaughtered. This trend is also expected to continue through 1984. The Bureau has estimated a further 6.3 per cent decline this year in calf and cattle slaughterings to 7.5 million. During the next five years meat production is estimated to be 40 per cent below the peak levels of 1978. Between 1978 and 1980 Australia was producing around 1,812,000 tonnes of beef and veal a year. In 1984 it is expected that only 1,375,000 tonnes of beef and veal will be produced, a reduction of 437,000 tonnes. Undoubtedly therefore, there will be a further shutdown of abattoirs and meat processing workers will be laid off. Huge costs increases in the form of export inspection charges in my view can only further exacerbate the problems of an industry already in a very precarious position. In the Adelaide Advertiser of 29 November 1983 Mr Kerin was quoted as saying: The case of the abattoirs is reasonably weak in my opinion, because the charge will be passed back 70 to 80 per cent to the producer and eventually to the consumer. That, of course, was an attempt to justify the inspection levy increases. As I have already pointed out, over half of Australia's beef production is exported, so there is very little comfort. It is very difficult to see how beef exporters can pass their costs on to overseas consumers. As Mr Kerin well knows, they do not control the export price of beef. Furthermore, the producers are certainly in no position to absorb any cost increases. The beef industry, of course, has been conspicuously unprofitable in recent years. In 1982-83 farm income for a family beef farm averaged at around minus $1,711. The rate of return on capital investment for beef producers excluding capital appreciation has been negative for every year since 1976, except for the 1979-80 season. In 1982-83 beef producers received an average return on capital investment of minus 3.2 per cent . If the real rate of capital appreciation is included, that is, the measure of capital appreciation adjusted to remove the effects of inflation, the rate of return to beef producers in 1982-83 was minus 6 per cent. In a letter to the Australian newspaper, published on 21 December 1983, Mr Kerin claimed that the increased charges represented only a small percentage of the average value of the beast for slaughter. This, of course, is quite irrelevant. What should be taken into account is the percentage of the producer' s profit which is represented by the increase in export inspection prices. At a time when profit margins are so narrow, and even negative, there is no logical basis for arguing that producers can sustain any cost increases because they represent only a small part of the value of the beast. Pig producers are also experiencing very low or negative profits, a situation that is expected to get worse before it gets better. In 1983 pig producers were first faced with increased feed costs which were coupled with a 20 per cent to 25 per cent decline in pork prices, with the result that few, if any, producers were making a return on their investment. Pig slaughterings during 1984 are also expected to decline by 1.4 per cent. However, the final irony for pig producers must be that whilst 85 per cent of animals are killed in export-registered abattoirs and therefore incur export inspection levies, only 2 per cent of pigs slaughtered go for export. Pig producers are therefore forced into the invidious position of paying around $6m a year for export inspection services, while export earnings from pig meat are around $4m a year. This Government cannot be totally unaware of this anomaly. In 1975 the Industries Assistance Commission's interim report 'Financing Promotion of Rural Products (Export Inspection of Rural Products)' pointed out: Financing inspection costs by an export levy penalises some types of meat more than others . . . The smaller the proportion of output that is exported the larger is the burden imposed on producers relative to the revenue collected, since the levy depresses not only export prices but also the price received for locally consumed meat. Clearly, this Government is indifferent to the double burden it is expecting meat producers to carry. Not surprisingly, abattoirs are now starting to hand in their export licences. Two major meat processors in Western Australia, Watsons and George Chapmans, have already done so. No doubt many more will follow. Some States are already considering building pig only abattoirs, at a time when it is recognised that there is over-capacity in the meat processing industry. I turn to the state of the Export Inspection Service. The total cost of the service in 1980-81 was $42.2m. This financial year, 1983-84, the total cost of the service is expected to reach $70.1m. This is an increase of almost $30m during four years when meat production was actually declining and the numbers of abattoirs fell significantly. The inefficiencies of the dual system of meat inspection, whereby State governments are responsible for inspecting meat for domestic consumption and Commonwealth inspectors deal with meat intended for the export market, are well documented. In 1978 the Prices Justification Tribunal report into beef marketing and processing noted the: . . . universal complaint had to do with the duplication of State and Commonwealth inspectorial services at many abattoirs. Two very obvious results of the dual inspection service spring to mind immediately. The first problem that arises is that meat intended for the domestic market will incur the higher export inspection levy if it passes through an export registered establishment. As I have already noted, 85 per cent of all meat produced in Australia is processed at an export registered abattoir. Secondly, the dual system necessitates State and Commonwealth inspectors working alongside each other. The ill-feeling between the two groups is such that they even demand separate facilities in the same abattoir. Again, this is a long- standing problem noted by the Prices Justification Tribunal in 1978. It stated: Abattoirs are burdened with additional capital costs because Federal and State inspectors refuse to share accommodation except for showers and toilets. This Government is now attempting to restructure the meat inspection service and a five-year corporate plan for the Export Inspection Service has been produced by the Department of Primary Industry. Nowhere does it tackle the over-staffing and misallocation of labour resources that is rife in the Export Inspection Service. This Government has made no progress in overcoming this basic problem. It ought to be remembered that labour costs represent something like 54 per cent of the total cost of the Export Inspection Service. Overmanning was again noted by the Prices Justification Tribunal in 1978. I quote from its report of that year into beef marketing and processing: The management of some abattoirs expressed the view to us that the complement of Federal inspectors . . . was excessive. Explanation for the seemingly excess number-that is, of inspectors-at some plants ranged from the need to provide relief in the case of fatigue or absenteeism and the necessity to provide for leave entitlements, to the requirement to keep inspectors normally located at seasonal works in Northern Australia in continuous employment . . . Members of the Tribunal became accustomed to seeing a number of meat inspectors sitting in the sun or located in places other than where they would be expected to be, while the beef chain was in motion. The report also noted that although the number of export licensed abattoirs fell from 460 to 442 between 1974 and 1978, the number of Commonwealth meat inspectors increased from 1,562 to 1,787 in the same period. The explanation given for this increase by the Department of Primary Industry was that it was required to provide inspectorial staff to any processing plant which asked for them. Evidently the situation has not changed. Between 1980 and 1983 the numbers of livestock slaughtered fell by 8 per cent. There was, of course, no decline in the number of meat inspectors. It is quite clear that Public Service pay awards and employment conditions are not appropriate for an industry that is both seasonal and cyclical. Frequently inspectors are required for work in the early mornings for which they receive overtime rates of pay. The meat industry will pay almost $6m in overtime payments for inspection services this year. For much of the year there is a surplus of inspectors because of the seasonal nature of the industry. This was noted by the report on the cost structure of the Export Inspection Service, which was carried out by Coopers and Lybrand on behalf of the Department of Primary Industry in 1983. This report also expressed the view that if utilisation of staff was unacceptably low, and there would seem to be little doubt that this is the case: There would be a case for industry not having to meet the full commercial cost of these additional staff. This report examined the average number of livestock inspected per inspector day , relating to the use of inspectors in the slaughter floor inspection area, who form the substantial part. It found that the average number of cattle inspected in the sample of establishments examined ranged from 45 to 58. However, 30 per cent of establishments were below this average, and only 20 to 36 beasts were examined by an inspector per day. The report also looked at staff utilisation, which it defined as productive time, that is, the total time booked or charged to an establishment in accordance with the staff loading standards for that establishment, divided by available time which is the total time less public holidays, annual leave, sick leave and formal training time. The report estimated that the total commercial cost of operating the export inspection service, after registration fees, was $62m in 1982-83 which represented a 75 per cent utilisation of field staff. It went on to estimate the revenue effect of an increase in the utilisation percentage, based on a 50 per cent recovery of costs through the inspection levy. The report found that a mere one per cent increase in the utilisation of field staff would benefit the taxpayer and the industry by over $400,000 in one year-a total saving of $827, 000. Over five years a 2 per cent increase in field staff utilisation would save the taxpayer and the industry a staggering $6,475,000. The Coopers and Lybrand study pointed out that the average annual salary of a meat inspector, including allowances, compensation and superannuation in 1982-83 was $26,481. For a veterinary officer the average salary in the same year was $35,317. Superannuation costs for export inspection staff represent some 20 per cent of salary costs-compared with the Australian industry average of 8.5 per cent. The current system of financing the inspection service by using a slaughter levy provides no incentive for more efficient manpower usage. Poor staff utilisation represents a huge cost for the meat processing industry, and until this problem is tackled, and demonstrable progress in overcoming it is made, it is quite unrealistic to expect the industry to pay more towards the export inspection service, especially at a time when the Government itself is asking for cost restraint from all sectors of the economy. I have already demonstrated the importance of meat exports to the Australian economy. By imposing additional costs of some $40m in a full financial year, the Government is threatening the viability of one of our major exporting industries . Most of our major competitors do not pay for their inspection services. New Zealand and Canada, for instance, have their export inspection services totally funded by their governments. The cost of converting a live beast to boneless beef in a carton currently accounts for around 20 per cent of the price received for the meat in the United States. The Bureau of Agricultural Economic recently pointed out: These costs compare most unfavourably with meat processing costs in South America, largely because of differences in plant utilisation labour costs and productivity . . . (the) heavy cost burden . . . can only be supported because we do not have to compete with the major low cost producers. If Australia ever loses its foot and mouth disease free status, or if the South Americans find a way to control the diseases, or if for other reasons the US, Korea and even perhaps Japan, decide to accept imports from these countries, we will find it impossible to compete with our current cost structure. Mr Kerin has said: It is the livestock and meat industry which is the prime beneficiary of the meat inspection service- implying, therefore, that the industry should finance the inspection service. This clearly disregards the fact that it is the entire community which benefits from the export earnings of the industry. Furthermore, there is the point made in the Industries Assistance Commission interim report of 1975 'Financing Promotion of Rural Products (Export Inspection of Rural Products)' which states: If the export charge were abolished, there would be a transfer of income back to meat producers. . . .These transfers would encourage a flow of resources to the meat industries. This in turn would result in an economic gain to the nation if the . . . additional resources devoted to beef would otherwise have been employed in less efficient industries. The Commission judged that this would indeed be the case when it stated: Meat industries (and in particular beef) are, and have been low cost, compared with other industries which are alternative users of the same resources. So it concluded: If resources are encouraged to flow into the meat industries through a Government subsidy of the cost of export inspections, there will be a net gain to the Australian economy. Of course, it can be argued that the cost of inspecting meat which is intended for export will be borne by the Australian taxpayer, as it cannot be passed on to the overseas consumer. Once again, however, we come back to the point made in 1975. By encouraging an efficient, low cost industry which receives a fraction of the government assistance paid to manufacturing industries, which it would be hard to describe in the same terms, there will in fact be a net economic gain to the community. Furthermore, the meat inspection service protects the health of the community and, in that context, benefits the whole community. Even if one accepts the findings of the 1983 Industries Assistance Commission inquiry into the abattoir and meat processing industry which stated that the inspection service was a commercial cost which should be borne by the abattoir, we still come back to the point that the meat industry is being ordered to support a service that is nowhere cost efficient. Finally, I make the point that the meat industry has not been properly consulted with regard to the decision to increase inspection levies. Indeed, the Australian Meat Exporters Federal Council offered to provide experienced members to make up a finance committee with the export inspection service to examine ways in which the service could be made more cost efficient. In return, it asked the Government to delay the inspection charge increases until this committee had reported. The Government at that time chose to take no action on this proposal. It is interesting to note that the Department of Primary Industry's corporate plan for the meat inspection service, talks about greater consultation with industry, which is listed as a fundamental initiative to improve the inspection service. If this Government had not ignored this and had consulted more widely with the industry before raising the export inspection levy, it would have been better equipped to make a more sensible decision on this issue. As it is, the meat industry is now expected to make an increased contribution to the costs of running an inspection service over which it has no control. This is equivalent, of course, to taxation without representation. The costs incurred in the inspection service were incurred without an opportunity being given for the industry to identify economies or more cost effective procedures, which all other sections of the industry are required to adopt in order to survive commercially. Mr Kerin, in his statement of 24 August 1983 to the House of Representatives, admitted: Industry is entitled to be provided with an efficient inspection service if it is paying part of the cost. If the Government can recognise that fact, surely it must understand that until the meat inspection service is operated as efficiently as the industries themselves are expected to operate, an already struggling meat industry cannot be asked to support the financial burden of increased export inspection levies. Senator KILGARIFF(Northern Territory)(10.08) —I want to make a brief point. I think it would be most inadvisable for the Government to go ahead with the proposal to increase the levy until the Interim Inspection Policy Council has had time to report to the Minister for Primary Industry (Mr Kerin). I would then expect a report to the Senate. I note that the Interim Inspection Policy Council had its inaugural meeting, set by the Minister, on 14 February and that at that meeting the Minister asked the Council to carry out as a matter of priority an examination of the financial and economic aspects of the current recovery of inspection charges in the export meat industry. It is just common sense that this Bill be not proceeded with until the report has come from this Interim Inspection Policy Council. The particular point I wish to make is that I note that the Council has set up a plan for the working party to visit Brisbane, Sydney, and Hobart during the week commencing 12 March 1984 and to visit Perth, Adelaide and Melbourne during the following week. There may be a good reason for it, but I do not see a mention of the Council going to Darwin. The pastoral industry in the Northern Territory is a huge industry. It plays a major part in meat production in Australia. One would think that if the Council was going to the major cities for these hearings it would have planned to go to Darwin, too. Perhaps the Minister will advise me on this matter. I ask that the Council reconsider its planning to ensure that the Council or, at least, the working party visits Darwin to take evidence from pastoral associations of the Northern Territory. Question put: That the resumption of the debate be an order of the day for the first sitting day after 1 May. The Senate divided. (The President-Senator the Hon. Douglas McClelland) Ayes . . . . . . . . . . . 31 Noes . . . . . . . . . . . 27 —— Majority . . . . . . . . . 4 —— Archer, B. R. Kilgariff, B. F. Bjelke-Petersen, F. I. Lajovic, M. E. Boswell, R. L. D. Lewis, A. W. R. Carrick, Sir John MacGibbon, D. J. Chaney, F. M. Macklin, M. J. Chipp, D. L. Martin, K. J. Collard, S. J. (Teller) Mason, C. V. J. Crichton-Browne, N. A. Missen, A. J. Durack, P. D. Rae, PeterEvans, Jack Reid, M. E. Guilfoyle, Dame Margaret Scott, D. B. Haines, J. Townley, M. Hamer, D. J. Walters, M. S. Harradine, B. Watson, J. O. W. Hill, R. Withers, R. G. Jessop, D. S. Coates, J. McClelland, DouglasColeman, R. N. McIntosh, G. D. (Teller)Colston, M. A. Maguire, G. R. Cook, P. F. S. Primmer, C. G. Crowley, R. A. Ray, RobertElstob, R. C. Reynolds, M. Evans, Gareth Richardson, G. F. Foreman, D. J. Robertson, E. A. Georges, G. Ryan, S. M. Gietzelt, A. T. Sibraa, K. W. Giles, P. J. Tate, M. C. Grimes, D. J. Walsh, P. A. Hearn, J. M. Zakharov, A. O. Jones, G. N. Messner, A. J. Childs, B. K. Question so resolved in the affirmative. Motion (by Senator Grimes) proposed: That the Income Tax Assessment Amendment Bill (No. 5) 1983 be postponed until the next day of sitting. Senator CHANEY(Western Australia-Leader of the Opposition)(10.13) —I want to make just a couple of remarks, in part because this motion, unexpectedly, will bring on the Customs tariff legislation and I note that Senator Peter Rae, who will be handling that for the Opposition, is not yet present. I welcome the fact that the Government has responded to Senator Chipp's notice of motion, which the Opposition has indicated that it will support, which notice of motion suggests that the Government should give the Senate the benefit of access to the advice which the Commissioner of Taxation has given to the Government about this legislation. We are, course, particularly interested in that proposition because the advice which was tendered to the former Government by the Commissioner of Taxation is an important factor in determining the Opposition's attitude to the legislation that we are currently adjourning. In the light of that advice, we have taken the view that the legislation should be amended, for reasons which are supported by the Australian Taxation Office itself. Of course, it is always possible that other information is available and that there have been further and better thoughts on the matter. I believe that in this very difficult area of trying to get the tax law into a form which is both fair to taxpayers and reasonable to that legion of taxpayers who actually pay their tax in full, we should have the benefit of all of the advice of the Commissioner that might be available. I had some doubts about Senator Chipp's proposal when he originally mentioned it to me. I mention that now because I am sure that the Government will share those doubts. After all, what we are asking for is for the advice from the senior taxation official in Australia to be made public. It might be useful to remind the Government that, I think the year before last, the previous Government made a vast amount of advice from the Taxation Commissioner available to the public and to the Opposition. I seem to remember that the then Opposition found that to be a very useful source of information in putting the case that it wished to put before the Australian people on the issue. On the basis of that precedent-I think the present Government would agree that it was in the national interest to make the advice of the Taxation Commissioner available-I believe that the Government should give consideration to the request which has been made by Senator Chipp and should agree to it. In this area, as in so many others, we are faced with very real problems Those problems, however, impact on taxpayers who have honestly and properly-(Quorum formed) I am glad to have a larger audience for this speech. In any event, I hope that in the time which the Government is now permitting itself for consideration it will seriously consider the suggestion made by Senator Chipp and enable the Senate to make a decision on this important legislation which will effect many small businesses, hence employers of labour in Australia. I hope it will give the Senate a positive response which will enable us all to deal with the Bill in a more intelligent fashion. Senator HILL(South Australia)(10.18) —It seems to me that this motion to adjourn the debate provides an opportunity to raise a few questions to which the Government might like to give consideration before next week. I hope Senator Chipp's action this morning will enable the Senate to be better prepared for the debate next week. I wish to raise a number of matters that the Government might consider. The second reading speech of the Minister for Social Security (Senator Grimes) referred largely to abuses of the nature of fraud. I would like to know next week how many such cases the Minister is aware of. Mention was made in the other House of one case in New South Wales. Is this legislation based simply on one case of a fraudulent nature? I would also be interested to learn next week how much tax is being lost through these so-called abuses. If the Minister is simply relying on this one case or several cases of fraud, I would be interested next week to know also whether the Commissioner of Taxation and the Government have taken any action, either about offences under the Commonwealth Crimes Act or, alternatively, under Part IVA of the Income Tax Assessment Act since it has been in force. I will also be interested to learn next week why 1 July 1977 has been chosen as the cut-in date, the date from which assessments are to be made. Why is that date so critical? Will it be suggested to the Senate next week that these cases did not exist in the previous month? Why has the middle of 1977 been chosen as the date to which this tax should operate retrospectively? I will be looking particularly next week for some explanation of why, if these funds did not qualify because excess benefits were allocated during the last seven years, that allocation has been allowed in those years. I cannot understand that. In other words, as Senator Chipp knows, if excessive benefits have been allocated under a section 23F fund the commissioner has a responsibility not to allow it. The party that has paid the sum in could not get a deduction for it. If income is earned by the fund it could be taxable; it might not get the taxation exemption under section 23F. If the Commissioner has been carrying out his role responsibly and in accordance with his obligations under the Act I cannot see why it is now necessary to legislate retrospectively in this form. Senator Chipp —You can bet that he has been doing that. Senator HILL —Of course he has been doing it. If he has been doing it, why are we to have this legislation before us at all? It seems to me that there is just no purpose for it. This debate has been a handy opportunity for me to raise these few matters to which the Government might give consideration before next week when the matter again comes on for debate. Senator HARRADINE(Tasmania)(10.23) —The motion to adjourn consideration of the Income Tax Assessment Amendment Bill (No. 5) 1983 is to enable the Government, as far as it is possible, to consider providing to the Senate the advice that it has received or which was available to it in respect of the subject matter of the legislation. I take this opportunity to point out that I support the delay of this measure for that purpose. The Minister representing the Treasurer in this place, Senator Walsh, said on 16 December 1983 that he received from the Australian Taxation Office advice in relation to the interpretation of the Acts Interpretation Act. I do not suggest for one moment that Senator Walsh deliberately misled the Senate on 16 December. I think he genuinely believed that he was correct. I invite honourable senators to read Hansard of 16 December to see how totally incorrect he was on that occasion. The fact is that in making totally incorrect statements and giving totally incorrect advice to the Senate he indicated that this was what he was advised by the Taxation Office. It might be useful for the Senate to receive that information as well as the information we are seeking at this time. Question resolved in the affirmative. Debate resumed from 1 March, on motion by Senator Gareth Evans: That the Bills be now read a first time. Question resolved in the affirmative. Bills read a first time. Senator GRIMES(Tasmania-Minister for Social Security)(10.25) —I move: That the Bills be now read a second time. I seek leave to have the second reading speeches incorporated in Hansard. Leave granted. The speeches read as follows- Customs Tariff (Anti-Dumping) Amendment Bill (No. 2) 1983 This Bill and the Customs Tariff (Anti-dumping) Miscellaneous Amendments Bill 1983 which I propose to introduce in a few moments, from a package of legislative changes arising from a review of Australia's anti-dumping and countervailing legislation. The Government's election platform included a commitment to strengthen anti- dumping procedures to ensure that goods are not landed in Australia at unrealistically low prices. A wide ranging review of the legislation was announced on 10 April 1983. A green paper was subsequently published and an opportunity was afforded state governments, industry and commerce organisations, trade unions and all other interested parties to submit their views on ways in which the anti-dumping and countervailing legislation and procedures might be improved. Some 150 submissions were received, canvassing a very wide range of views and various proposals for change. Dumping occurs when the products of one country are exported to another country at less than their normal value. Normal value is defined as the price of like goods sold in the ordinary course of trade for consumption in the country of export. Dumping is condemned internationally as unfair trading if it causes, or threatens, material injury to the industry producing like goods in the importing country and a dumping duty, equal to the difference between the export price and the normal value, may be levied on dumped imports. Where any subsidy, bounty, reduction or remission of freight or other financial assistance applies to the production, export or carriage of goods exported to Australia and those goods cause or threaten material injury to an Australian industry, countervailing duties, equal to the amount of subsidy or other assistance received, may be levied. Australia's international rights and obligations in respect of anti-dumping and countervailing action are coverned by its membership of the General Agreement on Tariffs and Trade and the relevant GATT Agreements negotiated in 1979 during the Tokyo round of multilateral trade negotiations. These agreements are known as the GATT Anti-dumping code and the GATT code on subsidies and countervailing duties. The provisions of the GATT and the Codes are designed to ensure a balance of rights and obligations between exporting and importing interests by attempting to ensure that the use of dumping and subsidy practices do not adversely affect or prejudice the interests of any signatory and that offsetting measures, whilst providing relief to local industry suffering injury, do not unjustifiably impede international trade. The Customs Tariff (Anti-dumping) Act 1975 was enacted in that year to give effect to Australia's decision to become a signatory to the GATT Anti-dumping Code. The act was revised in 1981 to enable Australia to become a signatory to the revised GATT Anti-dumping Code and the GATT code on subsidies and countervailing duties arising from the Tokyo round of multilateral trade negotiations. Before I explain the specific changes in this Bill I will take a few minutes to outline some changes to administrative procedures for processing dumping or subsidisation complaints which emanate from the review. The government considers it is fundamental to effective anti-dumping and countervailing action to ensure that complaints are dealt with expeditiously and that all parties to a complaint have an opportunity to provide information relevant to the issues in the complaint within a reasonable time frame. It is proposed, therefore, to require the Department of Industry and Commerce, in other than exceptional cases, to arrive at a preliminary finding on whether there is a case of injurious dumping or subsidisation within 45 days of accepting a complaint. The suppliers of the imported goods and the importers as well as the complainants will be given an opportunity to provide information relevant to the complaint within a specified period, usually 30 days, during this inital examination. Questionnaires will be provided to all interested parties to simplify the process. If a preliminary case of injurious dumping or subsidisation is determined, the department will also be required, in other than exceptional circumstances, to complete its investigation of the complaint within a further 120 days. This is the normal period of validity of provisional security action. Consultations required under the GATT Code on subsidies and countervailing duties and Australia's bilateral trade agreements would occur during these periods. The time limits I have just mentioned apply to normal complaints but must remain flexible to deal with cases which require a speedier preliminary finding or where the complaint is of a particularly complicated nature and where as a consequence the timetable just cannot be met. If information requested from interested parties to a complaint is not forthcoming within the requested time frame decisions will be made on the evidence available to the Department at the time. To counter import source switching to countries not named in the original complaints, it may be necessary to take preliminary action on the basis of tentative normal values established as a result of previous investigations or other information available to the Department. This will be done if it is necessary to extend a complaint where significant quantities of goods are imported from countries not named in the existing dumping notices and where there is reasonable cause to believe such shipments are at dumped prices. To ensure that the effects of provisional security action are not eroded, securities will not be returned automatically to importers when dumping or subsidisation complaints are suspended on the basis of acceptance of voluntary undertakings by exporters in respect of future exports. The Government believes that these administrative initiatives will significantly strengthen the procedures for dealing with complaints of dumping or subsidisation, while ensuring that overseas suppliers and importers are given ample opportunity to supply information and submit rebuttal arguments against any allegations of unfair trading practices. I now turn to the major changes proposed by this bill. By clause 3 of the existing definition of business associates in section 4 of the Act is being aligned with the similar defintion of ''related persons'' in the valuation provisions of the Customs Act. Currently, the Customs Tariff (Anti-dumping) Act includes provisions which enable the Minister to disregard the invoiced export price for certain import transactions between business associates and to determine the export price for those transactions on the basis of the price for the first arms length sale of the goods in Australia by the importer less prescribed deductions covering all costs normally incurred beyond free-on-board level. This enables action to be taken to counter sales dumping, or so called hidden dumping. Hidden dumping occurs when the parties to the transaction arrange to set the export price shown on the invoice at or above the normal value but also arrange to subsequently share the profit on the export sale. An importer can then sell the goods at a loss to gain market share. The provisions of clause 4 will permit the Minister to determine the export price in such transactions which involve parties who are not business associates . The provisions of clause 4 will also enable the Minister to accept the invoiced export price for transactions between associates once it has been determined that the relevant parties trade at arms length, notwithstanding their association. Under the provisions of the Act, where the exporter does not sell like goods to those exported in the ordinary course of trade for home consumption in the country of export in sales that are arms length transactions it is necessary for the minister to initially seek to obtain pricing information from other sellers of like goods in that market, before applying any other criteria for establishing a normal value. For example this may be a constructed price based on the exporter's cost of production, selling and administration expenses and a reasonable profit. The amendments proposed by clause 5 will mean that, in future , where the minister is satisfied that it is not practicable to obtain within a reasonable period of time, pricing information in relation to sales by sellers other than the exporter, the normal value may be assessed using other provisions of Section 5. Where the minister so directs, the Customs Tariff (Anti-Dumping) Act currently provides for normal values to be determined on the basis of the highest price paid for like goods sold in the ordinary course of trade in the country of export for export to a third country. In conformity with the Gatt Anti-Dumping Code Clause 5 of the Bill will allow the highest export price to a third country selected for normal value purposes to be a representative price. Another very important provision relates to the minister's powers to determine the normal value of goods in circumstances where prices for like goods to those exported are sold for consumption in the country of export and have been, for an extended period, sold at a price level which would not permit recovery of all costs incurred in the production and sale of the goods. In other words domestic sales in the exporting country are being consistently made at a loss. The provisions of Clause 5 provide that such sales will not be regarded as having been made in the ordinary course of trade if they have been made over an extended period of time and in substantial quantities and are not at prices which permit recovery of all costs within a reasonable period of time. The normal value may then be established having regard to any remaining sales of like goods that are not at a loss made in the domestic market of the exporting country during the period subject to investigation, if they are made in sufficient quantities to be representative. In the absence of such sales a normal value will normally be constructed on the basis of the cost of production of the goods, selling and administration expenses plus a reasonable profit margin. The European Economic Community and the United States have legislated to give effect to these concepts. Where sales are not made in the domestic market of the exporting country, normal values may at times be assessed on the basis of prices for export sales to third countries. The amendments proposed by Clause 5 will enable such sales, when made at a loss, to be disregarded for normal value purposes. Clause 6 of the Bill proposes the inclusion of an indicative but not exhaustive listing of those factors to which the minister may have regard when determining, for the purposes of the Act, whether material injury has been caused, or threatened, to an Australian industry. This provision is designed to give effect to the requirements of Article 3 of the GATT Anti-Dumping Code and Article 6 of the GATT Code on subsidies and countervailing duties. The Customs Tariff (Anti-Dumping) Act currently provides that the dumping duty is a sum equal to the amount by which the amount of the export price of goods is less than the amount of the normal value of the goods. The minister may however, by notice published in the Gazette, direct that the dumping duty in respect of goods is to be an amount ascertained by reference to the value, or to the weight or other measure of quantity of the goods provided that that amount does not exceed the difference between the export price and the normal value. The provisions of Clause 7 will make it clear that under the latter provision the minister may determine the amount of dumping duty on goods to be a sum sufficient to prevent injury to industry. Clause 10 proposes a complementary change to the provision in relation to the determination of countervailing duties. Other necessary machinery amendments of a technical nature, which are included in the Bill are set out in the explanatory memorandum which has been circulated. I said earlier that it is this Government's firm policy to deal quickly and effectively with unfair trading practices by exporters to this country which cause or threaten injury to Australian industries. The Government believes that the measures in this legislative package when combined with the improved administrative procedures will ensure that the Government's policy in this matter is fully met. At the same time it is considered that the changes will ensure that the necessary investigations of complaints are conducted in accordance with Australia's international rights and obligations and in a manner preserving the rights and interests of all interested parties to those complaints. During the review a wide range of proposed modifications to the legislation were submitted by various interested parties. I commend all parties contributing to the review for their extremely detailed and constructive submissions. For the information of honourable senators I will comment on some issues upon which proposals for change were submitted but, where, after careful consideration the Government has decided not to adopt the proposals. One such issue is secondary dumping-the inclusion of dumped components or raw materials into a manufactured product which is subsequently exported. Complex problems of definition and interpretation of inputs to the manufacturing process in other countries would be involved in any anti-dumping action. For this reason an investigation of secondary dumping in other countries would be complex, protracted and extremely difficult in terms of access to evidence to prove any allegations. It is also unlikely that the countries supplying dumped components or raw materials would agree to customs officers conducting the necessary investigations in their countries. The Government will however, continue to pursue the matter in the GATT with a view to having a satisfactory formula developed internationally on this issue within the GATT anti-dumping code. On the question of goods purchased by tender, Commonwealth purchasing procedures are being examined to determine whether, at the time of evaluation, tender documents should require all relevant information to be supplied by the tenderer to enable normal values to be assessed for any imported goods to be supplied under the contract. The last issue on which I will comment, is freight dumping, involving the remission or reduction of overseas freight. In this regard countervailing duties may be imposed where freights are less than normal freight as defined in the Customs Tariff (Anti-Dumping) Act, and injury is thereby caused or threatened to an Australian industry. The Government believes the existing provisions to be sufficient and has decided to make no alterations. The amendments proposed by this Bill are expected to have little effect on revenue collections for 1983/84. When dumping or countervailing duties are imposed, overseas exporters normally increase their export prices to levels which avoid any additional impost on goods at the time of importation. The measures are designed to ensure that Australian industries continue to be protected from unfair trading practices relating to imported goods. I commend the Bill to the Senate. Customs Tariff (Anti-Dumping) Miscellaneous Amendments Bill 1983 This Bill is complementary to the Customs Tariff (Anti-Dumping) Amendment Bill (No. 2) 1983. It proposes to amend the Customs Act 1901 and the Industries Assistance Commission Act 1973 to introduce new provisions resulting from the review of Australia's Anti-Dumping and Countervailing Legislation. To complement the powers provided to the Minister in the Customs Tariff (Anti- Dumping) Act to combat sales dumping, or so called hidden dumping, part two of the Bill adds a provision into the Customs Act empowering a collector of customs or an officer appointed by him to enter certain premises on a warrant and also to request persons, by written notice, to furnish documents and information and to attend and give evidence in respect of goods subject to anti-dumping action. These additional powers are necessary to enable effective investigation of practices such as secret rebates and package deals, which are part of hidden dumping schemes between parties to import transactions. Clause 7 in this part of the Bill introduces new provisions into the Customs Act to enable the Minister, or his delegate, to authorise the convening of meetings of the Australian industry which is party to a complaint of dumping or subsidisation for the sole purpose of providing advice as to non-injurious prices or quantities which might be incorporated in any voluntary undertakings by exporters or by governments. The Gatt Anti-Dumping Code, the Gatt Code on Subsidies and Countervailing Duties and the Australia/New Zealand Closer Economic Relations Trade Agreement encourage the resolution of complaints through consultation and the acceptance of undertakings. The Customs Act will also be amended by clause 7 to provide that the Trade Practices Act specifically applies to meetings convened under the new provision and that all parties to such meetings must comply fully with that Act. The provisions of proposed section 269V will require interested parties to a dumping or subsidisation complaint to submit written information that they may wish to provide relative to the complaint verified by statutory declaration or witnessed by a notary public. This will require persons supplying written information they wish to be taken into consideration to be satisfied as to the accuracy of that information. The Customs Tariff (Anti-Dumping) Act provides an opportunity for the Industries Assistance Commission to review dumping and countervailing decisions. The Government takes the view that such reviews should be confined to the facts of the particular case and that as the question at issue is one relating to unfair trading practices and is not an Industries Assistance matter, then the policy guidelines in the Industries Assistance Commission Act on Industry Assistance issues are not relevant. The measures in part three of this Bill propose to amend the Industries Assistance Commission Act to provide that the reviews by the Commission are conducted as reviews of the facts relating to dumping or countervailing issues. The measures contained in this Bill will have no direct financial impact. I commend the Bill to the Senate. Senator PETER RAE(Tasmania)(10.26) — The question of anti-dumping provisions is one which has no novelty. It is one which, over a period, has concerned successive governments. I am glad the present Government is taking measures to improve the anti-dumping procedure. I do not think there is a need to go as far as attempting to throw away one of the rights about which the Attorney-General ( Senator Gareth Evans) spoke as recently as 28 February 1984. As reported on page 27 of the Senate Hansard, he said: The most worrying aspect of this whole matter is, I believe, the massive illegality and invasion of privacy which appears to have been involved . . . That is a statement which could have come from either side of the chamber in the period since the late 1960s, a period of which I am aware. In the late 1960s there was a recognition, particularly in relation to primary industry legislation, that the bureaucracy was trying to make life easy for itself by ensuring that it had a right of entry and search without warrant even though it was only to enforce something which was perhaps less criminal than most of the criminal law with which we and the States deal. Members of the police forces have to have warrants and normally have to obtain justification for entry into premises and the right of search. I thought the Senate had established in the late 1960s and early 1970s that it would never permit legislation to go through this place, unless there was some absolute justification which transcended all the normal requirements of natural justice, without requiring that, where a right of entry and search was given, it would be upon a warrant issued by at least a justice of the peace. A former leader of the opposition and a former leader of the government in this place, the present Mr Justice Lionel Murphy, was one of may people who pursued such a requirement. We seek, by amendment a similar requirement. I do not need to quote from the many speeches Mr Justice Lionel Murphy made asserting the need, the right and justification for this chamber to protect the rights of individuals by ensuring that excessive powers were not given. I find quite extraordinary the idea that, in order to make effective anti- dumping provisions, one should strengthen the powers of investigating officers and give them more power than a police officer has in pursuing a murder. I am sure that the Government, upon giving some consideration to this matter, will agree to an amendment which I propose to move which will require the normal provisions to apply; that is, that the right of entry and search should be upon warrant after a prima facie case has been made out to a justice of the peace and a warrant has been issued. I hope that the amendment which I propose to move is being circulated. I understand that not every honourable senator has received a copy of it so I will speak on some other aspects of the legislation to enable people to look at it. Then I will come back to the amendment. Anti-dumping legislation is a bipartisan matter. There is no doubt whatsoever that Australia and a number of other countries have been subjected to dumping particularly during the world trading recession. Probably one of the most offensive things that has happened-one of the things which makes even the representatives of the European Economic Community feel a little shamefaced-is when the EEC dumped its subsidised sugar in Papua New Guinea. Having produced sugar from sugarbeet, with a vast subsidy at an absolutely impossible price in world competitive terms, that sugar was dumped on the doorstep of a country of whose budget we provide a significant percentage. Of all the examples to demonstrate how rude dumping can be I think that example is probably the one that takes the bun. It is not a matter of just making a wild assertion. Australia's objections to Europe's dumping of sugar have been upheld by the General Agreement on Tariffs and Trade. The legislation which the Government has introduced is certainly supported by the Opposition. It is the sort of measure which we indicated in government that we would undertake. I could be pedantic and go through this legislation and say: 'We might have done this or that differently'. I do not think it is particularly helpful to adopt that attitude. There are provisions in the legislation for the Minister to deal with hidden dumping or sales dumping. He may construct a normal value where such a value is not available. He may disregard sales at a loss for normal value purposes. An indicative definition of the factors which constitute material injury to Australian industry is given. The Minister has discretion to determine the amount of countervailing duty where insufficient information is supplied. There are a number of measures in this legislation which entirely accord with what the previous Government was doing. They have been picked up by the present Government and are being carried forward as bipartisan policy. They will make effective, faster and more efficient the measures which Australia can take to defend itself. The position in which we find ourselves in Australia is an extraordinary one. We have had some debates on this matter in the past and I do not intend to take much of the time of the Senate to reiterate the points that were made. Let me just state them very briefly. When the GATT ministerial meeting took place in late November 1982 the former Minister for Trade and Resources and Deputy Prime Minister, the Rt Hon. Doug Anthony and the former Minister for Primary Industry, the Hon. Peter Nixon, both attended part of that meeting. Both addressed not only that ministerial meeting but also people in Australia at considerable length about their objections to the way in which so many members of GATT were blatantly avoiding GATT and any real determination to get on with what everybody -when I say 'body' I mean it in the plural sense-every national and international body had been passing resolutions about. If this matter had not come on quite so quickly this morning I had intended to quote from some of the resolutions of the Council of the European Parliament and of the North Atlantic Assembly. Let me assert, without being able to quote, because this matter came on rather quickly this morning, that each member of GATT in September, October last year carried resolutions asserting that one of the major problems in the world today was the increase in protection, in the non-tariff barriers and in the measures being taken by various countries to endeavour to protect their own employment to the net destruction of employment world-wide. I was pleased that Senator Button on his recent return from overseas in an interview reported in the Australian Financial Review said the things which I certainly have been saying for a long time and with which I would completely agree; that is that Australia has the capacity and the opportunity but it has really to bring itself into line with the trading practices of the rest of the world and try to get the rest of the world to bring its trading practices into a form which is most conductive for the expansion of trade and not the contraction of world trade. One of the sad things of the recession has been the extent to which hypocrisy and blatant avoidance of international obligation have become a part of international practice. We have seen countries using thousands of measures. Recently I obtained from the Minister for Trade (Mr Lionel Bowen) a list of some 2,000 measures which are identified by his Department. I am informed, but have not as yet received, that there is a United Nations Conference on Trade and Development list of some 22,000 measures which are used to avoid GATT and to limit trade. What we are concerned about in relation to this legislation is an attempt by the Government, which is a bipartisan approach, to say: Why should this country be a victim for dumping and a victim for trade practices which are avoided or banned by other countries? France was concerned about the extent to which Japan was exporting video machines to France. So France required those videos to be imported through the Customs office at Poitiers. Anyone who knows his European geography will be aware that Poitiers is not exactly a port, it is not exactly close to any major distribution centre and it is not the sort of place that one would expect all of the video tape machines to be-- Senator Button — How many customs officers have they there? Senator PETER RAE —As I understand it, one customs officer inspects every machine. The equivalent of that would be for Australia to require no tariff on imported vehicles, no quotas on imported motor vehicles but every one of them to be imported through Port Hedland and driven to its point of sale. That is the sort of thing we could do if we applied the principles. Senator Button —Alice Springs. Senator PETER RAE —The Minister suggests Alice Springs. I am prepared to accept that as an alternative. Air freighting them to Alice Springs would make it even more an application of the Poitiers principle. It is not something which is fair trading. It is not something which our economy and the people who make our economy tick should have to put up with. I believe that it is necessary for this Parliament to support the sorts of measures that the Government has introduced. There will be the introduction of some discretions to the Minister to enable the anti-dumping provisions to work more efficiently. I point that out to those people who might otherwise be concerned that the Opposition is not taking its usual very keen line in relation to ensuring the protection of the rights and privacy of individuals. The discretionary powers being given by this legislation to the Minister are subject to the Administrative Decisions (Judicial Review) Act 1977, are therefore reviewable and are not simply authoritarian actions which can be taken without people who are concerned being able to object. In the Australian Liberal and National Party policy overview with regard to industry and commerce, it is stated: . . . we shall fearlessly use such measures as are necessary to protect Australia from the damaging effects of dumping, improper transfer pricing, and other unfair de-stabilising trading actions by other nations. With that policy how could one not support this legislation? I have dealt with both of the Bills as composites because I think they are complementary. I can, if the Minister wishes me, deal in a little more detail with them separately but , as I understood it, I thought we were dealing with them together as a composite package. I shall move in the Committee stage that amendments be made in the terms which have been circulated, which will be simply to introduce into the proposed legislation terms which have been introduced into innumerable Acts by this Senate to require that the right of entry and search be only upon warrant issue. In other words, a prima facie case has to be made out before officers with particular functions under Customs legislation, under primary industry legislation or whatever it may be, should certainly not have greater powers than the police, they should be required to obtain the warrants and to make out a prima facie case before they can barge into somebody's place and search. I do not wish to take up time having a combative debate with the Minister in relation to some aspects because I think a couple of other opportunities will come up later. I think I could suggest that these measures are not as expeditious or as detailed as they might have been. I encourage the passage of these Bills. I encourage the Minister's co-operation and that of other honourable senators in regard to the amendment which I will move during the Committee stage. I think other comments can be made about some aspects of fast track anti-dumping procedures which have not been taken, which are not included and which, hopefully, this Government will deal with or else move aside in the not too distant future and let us get on with it. Senator WATSON(Tasmania)(10.44) —The Senate is currently at the second reading stage of two Bills which are aimed at preventing dumping of goods on the Australian market at artificially low prices. Those two Bills are the Customs Tariff (Anti-Dumping) Amendment Bill (No. 2) and the Customs Tariff (Anti- Dumping) Miscellaneous Amendments Bill. The Liberal Party has foreshadowed through its shadow Minister, Senator Rae, a significant amendment which refers to a need to protect civil liberties by virtue of requiring a warrant. Necessary preliminary, initial investigations must take place before that warrant can be issued. We believe that the passage of an amendment of this kind is necessary for the protection of civil liberties within this country. We abhor actions taken by this Government which pretends to be the champion of civil liberties. We deplore, therefore, the inclusion of provisions that take away people's civil liberties. Therefore, I hope that the Senate will agree to the amendment that has been proposed by Senator Peter Rae. The two Bills reflect a review of Australia's anti-dumping and countervailing legislation. All parties basically agree with the tenor of each of the Bills. We believe that in relation to this major element, a warrant should be required before officers can inspect books and records. A significant feature of the Customs Tariff (Anti-Dumping) Miscellaneous Amendments Bill is Part III, which requires: . . . that inquiries conducted by the Industries Assistance Commission in relation to dumping or countervailing issues, are to be conducted without reference to the policy guidelines in the Industries Assistance Commission Act. Such inquiries will thus only relate to the question of the existence of facts relating to dumping or countervailing issues. We basically support this legislation. There is a need, therefore, to have a definition of normal price and normal transactions to prevent prices being artificially lowered or lowered on account of subsidy. It is therefore necessary to place a levy on the price to bring it to a normal price. Basically, Australia follows not only the spirit but also the letter of the General Agreement on Tariffs and Trade. Because of our honesty and integrity in following international agreements-whether a Labor government is in office, as is the case today, or a Liberal government as has been the case in the past-there is a genuine acknowledgment of the need to follow the GATT arrangements. One of the problems of the world today is that far too many representatives of countries pay lip service to the GATT provisions but then go back to their countries and develop a wide range of artificial barriers to trade, actions which cause tremendous problems in the world today, particularly for the developing countries. Under the proposed legislation all parties are given a reasonable time to provide information. This is accepted. The Department of Industry and Commerce must arrive at preliminary findings within 45 days. This provision is welcome. Suppliers of goods have 30 days to reply and after preliminary findings, if a case is proved, the Department must complete its action within 120 days. Some people would like that time interval to be somewhat shorter. I understand there are practical considerations for the length of that time interval. However, many industries in Australia believe that we should be looking to other mechanisms because, despite all the good intentions of past legislation-even this legislation-goods are still arriving in this country and selling at artificially low prices because the time interval for findings is still too great. Industries are required to prove damage. However, in some cases the local industries can loose a contract. Because it is known that goods will enter the country in two or three months time, there is immediate damage to the productive flow of Australian manufacturing enterprises even before the arrival of overseas goods. The legislation does not cover situations where a local Australian manufacturer is aware of the loss of his contract, the goods have yet to arrive in the country, but it is known that they will arrive in several weeks or several months time. The cutback in manufacturing can therefore occur in advance, the lay offs may have already taken place. Governments will have to exercise their minds to overcome these sorts of situations. It is not very satisfactory to the men who have been dismissed, to the owners who have lost their profits, when their business is facing bankruptcy, to get a judgment at the end of the day, stating, in effect: 'After all, we did think you were right'. Governments must exercise their minds to overcome these sorts of disruptions that can occur that are not covered by present legislation. Senator Peter Rae spoke very eloquently of the problems in relation to clause 4 , which deals with the export price involving parties which are not normally associates, which could be interfering with trade. Another aspect to which I draw the attention of the Government is the penalties in the Act. The Act contains a number of penalties. I wonder whether, in relation to the profits that can be made as a result of such activity, fines of $1,000 are adequate. It is true that in relation to a small business $1,000 might be seen to be an excessive penalty. But in relation to transnational companies, one might ask whether the $1,000 penalty is adequate. I wonder whether we should be looking at a sliding scale relative to the benefit or the profit that could be gained as a result of dumping if the company fails to follow the legislation as is required. Senator Peter Rae —If somebody is going to make a million he is not going to worry about a thousand. Senator WATSON —Yes. Senator Peter Rae has quite appropriately interjected that if a company makes $1m on the transaction-certainly if it is a once-off transaction, and we will never see that particular company trading in Australia again-the $1,000 woul be petty cash in relation to that transaction. Another feature is that the disruption to international trade and to manufacturing in Australia is not necessarily coming in on a consistent basis from one particular sphere. Because of the international recession, some overseas companies see Australia as a convenient dumping ground for one-off transactions. The tragedy is that they move in, and take their profit. They may take a few consequences as a result of it, but using a marginal costing basis, they can make a fortune by temporarily pushing the goods into Australia rather than elsewhere in the world. As world trade picks up they move back to their more traditional markets. Other companies which lack conscience consistently are picking off countries such as Australia, and particularly the under-developed world. It is for that reason that the United Nations Conference on Trade and Development has held successive meetings around the world to try to overcome the situation and to try to get some balance of sanity and establish, where possible, a new international economic order. Australia is in a difficult position in relation to trade. It finds its primary industries continously locked out of export markets by various artificial protective devices. On the other hand our own manufacturing industries are suffering assaults on domestic trade as a result of the dumping of goods on the Australian market at lower than normal prices or at subsidised prices. Sometimes it is the national governments outside Australia which are at fault, where they subsidise in a gross and manifest way the exports of their countries' products to places such as Australia. All nations are really part of an international family-a global community. With the growing sophistication of trade there is an interdependence of one economy on another. There are complex linkages amongst different sectors of the world economy. Therefore, a breaking down of trade barriers is needed. While in one sense it is unfortunate that we have to introduce this sort of legislation against dumping there is unanimous agreement around the world that anti-dumping legislation is not really a protective device in the normal sense of raising protective barriers. On the other hand we must not create an environment whereby we set up artificial devices which restrict world trade and closet our economy in such a way that it becomes uncompetitive. I believe we must look for practical measures which will remove obstacles to the development of world trade and thereby try to set up mechanisms that will usher in effective international economic co-operation and which will find fair solutions to the serious problems affecting not only the developed countries of the world but also the developing countries of the world. The serious economic crisis the world is facing today can be overcome only by mutual co-operation between all governments; between those of the North and South and between those of East and West. A serious economic rift is developing which is accentuating the disparities between rich countries on the one hand and developing countries on the other. Even within the rich countries, there is an increasing disparity between the rich and poor. It is an unfortunate feature of Australian life in 1984 that we are witnessing a growing gulf between the rich and poor and between the 'haves' and 'have nots' in our society. This is unfortunate. However, magnified on a world basis it leads to greater difficulties. If we are not careful economic wars can lead to hot wars, hot wars can lead to holocausts which would be beyond people's comprehension in relation to wars of the past. We have to overcome some of the disparities which include the rapid increase in debt of the Third World countries. As a result of the increase in debt of Third World countries which include countries of South America, Africa and now, increasingly, countries of the Pacific Basin, the Philippines and Indonesia, international indebtedness unfortunately is not improving. Borrowers in developed countries are having to pay an increased price for their money, a higher rate of interest, to offset the loss incurred by the developing world because a significant number of countries fail to meet interest commitments and loan repayments. The last few years have witnessed a fall in commodity prices, a deterioration in the terms of trade and growing protectionist measures. Both within this domestic parliament and when our Ministers go overseas all must espouse the principles of an open world economy. Let us not forget that 85 per cent of our export income principally comes from the mining and primary sectors of the Australian economy. Those sectors are largely unprotected by barriers. Those are areas which feel adversely every pinch and every wage increase particularly in an environment where commodity prices are dropping or where they are depressed. Therefore the people in this sector are not in a good position to suffer any increase in the cost of living. I can see a lot of problems facing Australia when, as a result of the spiral of wages and prices, each chases the other to the point where we have a high inflation rate, while our competitors lower their interest rates to more moderate levels. The action taken by New Zealand which resulted in its inflation rate dropping from 17 per cent to around 4 per cent was significant. I think it is necessary for us to recognise the importance of manufacturing industry in Australia. Appropriate and adequate measures need to be taken by this Parliament to ensure that goods are not dumped in this country at artificially low prices which will affect employment and the stability of Australian industries. I acknowledge that all parties regard dumping as quite abhorrent. Australian manufacturing industry is a major generator of wealth in this country. It produces 23 per cent of gross domestic product. Manufacturing is a significant employer of labour. We cannot stand by and allow such an industry to decline further. By research measures and by encouraging technology and competition we have to make Australian industry very much more competitive and raise the Australian standard of living. I think it is regrettable that we now find only 18 per cent of Australians employed in manufacturing industry. It was not all that many years ago when the figure was about 30 per cent. We wonder why we have an employment crisis in this country. We wonder why the young women of Australia are finding it difficult to get jobs. I think of all those people, who used to be employed in textile industries, now out of work. The bureaucrats say that those people can be redeployed and the industries restructured. If we go to the outer suburbs of Melbourne and Sydney and to all those small non-metropolitan towns in Australia that support perhaps one mill, we see the tragedy occurring. We see not only an economic tragedy but also a social tragedy affecting the framework of our society. It is a social tragedy because not only does a person lose a certain amount of self-esteem when he is displaced or put on the dole but also in some cases the health of that individual is affected quite markedly. I think we have to look at the question of unemployment very seriously not only in a local context but as a global problem because we are all part of a great family of nations. If we are to improve our standard of living, if we are to lessen this widening gap between the rich and the poor, we must recognise that a decision taken in one country can have widespread implications throughout the rest of the world. I support the measures and the amendment which will be moved by Senator Rae in the interests of civil liberties in Australia. Senator HILL(South Australia)(11.06) —The Senate is debating the Customs Tariff (Anti-Dumping) Miscellaneous Amendments Bill 1983. I think it is fair to say that we have just heard two excellent contributions from Liberal Senators Rae and Watson, who are acknowledged experts in the fields of international trade and industry and commerce. Both of them have eloquently put the problems facing Australian industry and the need for effective anti-dumping legislation. I do not think there is any dispute in this chamber about the need for such legislation; it is certainly not in question on this side of the chamber. I wish to raise a matter that Senator Rae mentioned in passing, about which at the Committee stage he will move an amendment. A matter that stands out-in fact it glares at anyone who peruses this Bill-is the provisions that allow for officers of the Australian Customs Service to enter premises without warrants and to demand answers to questions. As Senator Rae said a little time ago, these are powers which extend beyond those of a normal police officer exercising his duties. In such circumstances one must, of course, be extermely cautious and concerned about the reasons and justifications for this major extension of what would be regarded as reasonable powers for a Customs officer to enable him to carry out his duties. The amendments are contained in new clause 6 of the Bill, which will be section 214B of the Customs Tariff (Anti-Dumping) Act. They are divided into two parts. First, section 214B (1) states: For the purposes of the Customs Tariff (Anti-Dumping) Act 1975 an authorized officer may, at all reasonable times- I think it must be queried what 'at all reasonable times' means- enter premises where there are kept any accounts, books or other records relating to goods exported to Australia or manufactured or produced, or sold, in Australia and may inspect any such accounts, books, documents . . . All a Customs officer need do to be permitted to so enter premises is to show that he is an authorised officer. He may be required to show written evidence that he is an authorised officer. What that means, in effect, is that at any reasonable time a Customs officer can enter someone's business premises and demand to see all the books and accounts. If he is not given all reasonable facilities to do this a penalty of $1,000 is provided in the legislation. Secondly, he can require a person whom he believes to be capable of giving evidence that is relevant to the Act to attend before him and be examined, to answer questions and to produce to him all the relevant books and accounts that I mentioned a moment ago. He is given quite extensive powers, such as a power to administer oaths. Again, any person who, without a reasonable excuse, does not comply with that provision can suffer a penalty of $1,000. It might be thought a reasonable excuse that an answer would incriminate a person. It is of some concern to honourable senators on this side of the chamber that when we peruse this provision we find that a person is not excused from answering a question or producing books and accounts on the basis that to do so might incriminate him. Obviously for that to be so in legislation of this kind surprises us. No doubt it will be said by some honourable senators on the other side of the chamber that there is some protection in that such a person's immediate answer or the immediate content of the books and documents cannot be used in any prosecution against him. That is half an answer. It does not mean that evidence that can come to light as a result of answering such questions or producing such documents cannot subsequently be used against him. It is the old story. The example that is most often quoted is that of a person being examined in a murder inquiry. He says: 'I threw a gun in the river'. A provision such as this means that that answer cannot be used against him in a subsequent murder trial. But, of course, the police officer or the relevant officer under this Act can go to the river get the gun, carry out ballistics tests on the gun and, if it turns out to be as he suspected, he can use that evidence in a subsequent action that is brought against the person in question. So that is only half a justification for such a position. In relation to serious charges some people will argue that that is fair enough. It is a question that obviously is being considered by the Senate Standing Committee on Constitutional and Legal Affairs now that it is looking at the Government's proposed national crimes authority. It is argued by some that in the context of major organised crime such powers are reasonable. I concede that in that context it is arguable, but are such powers reasonable in the context of the Customs Tariff (Anti-Dumping) Miscellaneous Amendments Bill? I think that is very questionable. I turn to the second reading speech of the Minister for Social Security ( Senator Grimes) and look for the evidence to substantiate the need for such extravagant powers. I find that this part of the Bill is dismissed in two small paragraphs. The first paragraph states as a matter of fact what the provision is designed to do and the second paragraph, which is 3 1/2 lines, gives the basis of the necessity for such extraordinary powers. It states: These additional powers are necessary to enable effective investigation of practices such as secret rebates and package deals, which are part of hidden dumping schemes between parties to import transactions. No evidence whatsoever of necessity has been put before the Senate. We are simply told, in a few passing lines, that it is considered that these powers are necessary. In the Minister's speech no evidence is being put to the Senate of avoidance of responsibility in the past and of the extent to which there has been any loss to revenue or damage to Australian industry as a result of the officers coming under this section not having these extreme powers. These are questions to which I think it is more than reasonable for this Senate to require answers. One must ask: 'What is going to be lost if we protect civil liberties in the normal way and require that such an inspector obtain a warrant?'. Is it being suggested that if the inspector must get a warrant from a magistrate he will not be able effectively to carry out his obligations under the Act? I must admit, after considering the matter, that it is hard to imagine how one could possibly argue that that is the case. Therefore it is not surprising that today the shadow Minister, Senator Rae, will move an amendment to the Bill which would require an inspector, when he does not have previous consent to enter premises, to go before a justice of the peace and apply for a warrant. One would think that that is a very reasonable protection of civil liberties. Such a person must show that it is reasonably necessary to have a warrant. I presume that he would be able to do that, otherwise he would not want to be on the premises in the first place-at least one would hope so. Senator Rae will detail his amendment in due course. It seems moderately drawn. It does not seem to have been drawn in a way which in any way can hinder the effective operation of the anti-dumping provisions. Of course we do not want to hinder the effective operation of such provisions. The amendment is sensibly drawn. It provides for the issue of a warrant which would set out for the officer the time that he was able to enter, whether he could enter during the day or night, the kinds of things that he may be authorised to inspect or copy and for how long the warrant was to operate. In this second reading debate it is important to stress that we on this side of the chamber, although, as I said, we are particularly interested and concerned that anti-dumping provisions are effective, are also equally concerned that there is not unreasonable abuse of civil liberties when such abuse is not absolutely necessary. No evidence has been put to us to show that it is absolutely necessary. I hope that when we get to the Committee stage the Government will be reasonable and will see that the amendment to be moved by Senator Rae provides a sensible safeguard and will be prepared to support it. Senator GRIMES(Tasmania-Minister for Social Security)(11.16) —in reply-I thank honourable senators opposite for the thoughtful and careful contributions they have made to this debate. In essence, it seems to me-not pretending to be an expert in this area-that although we are all concerned about the problems of dumping and concerned to introduce anti-dumping legislation of this type Opposition senators are particularly concerned about what they see as potential breaches of civil liberties in this legislation. It is my understanding that the Government does not agree with this attitude. Senator Rae will move an amendment to cover this aspect of the legislation during the Committee stage of the debate . I think that the most sensible and sane debate will result if I thank honourable senators for their contributions and allow Senator Button to deal with the amendment during the Committee stage. Question resolved in the affirmative. Bills read a second time. The Bills. Senator PETER RAE(Tasmania)(11.18) —To the Customs Tariff (Anti-Dumping) Miscellaneous Amendments Bill 1983, I move: Page 2, clause 6, proposed sub-section 214B (1), lines 13 to 19, leave out the proposed sub-section, insert the following sub-sections: (1) For the purposes of the Customs Tariff (Anti-Dumping) Act 1975 an authorized officer may, with the consent of the occupier or in pursuance of a warrant issued under sub-section (1B), enter premises where there are kept any accounts, books or other records relating to goods exported to Australia or manufactured or produced, or sold, in Australia and may inspect any such accounts, books, documents or other records and make and retain copies of, or take and retain extracts from, any such accounts, books, documents or other records. (1A) An authorized officer may make application to a Justice for a warrant authorizing the authorized officer to enter the premises to which the application relates. (1B) If, on an application under sub-section (1A), the Justice is satisfied, by information on oath or affirmation, that it is reasonably necessary that the authorized officer should, for the purpose of exercising the powers of an authorized officer under this section, have access to the premises to which the application relates, the Justice may grant a warrant authorizing the authorized officer, with such assistance as he thinks necessary, to enter the premises. (1C) There shall be stated in a warrant issued under sub-section (1B)- (a) a statement of the purpose for which the warrant is issued, which shall include a reference to the matter in respect of which the authorized officer is conducting an investigation; (b) whether entry is authorized to be made at any time of the day or night or during specified hours of the day or night; (c) a description of the kind of things authorized to be inspected or copied or from which extracts may be taken; and (d) a date, not being later than one month after the date of issue of the warrant, upon which the warrant ceases to have effect. I refer honourable senators to my speech during the second reading debate and I will summarise the amendment. I will not take the time of the Committee to read it in detail. I thought-I am indebted to another honourable senator for drawing my attention to certain failures in the legislation, apparently last year, to ensure that the procedure was followed-that the battle had been fought in the late 1960s and the early 1970s to ensure that when the right of entry and search was given a warrant was required to be issued. Insofar as the former Government may have failed to do that I simply say that it was an act of negligence on the part of the Senate as a whole and on the part of some individual senators-one of whom I have to say is me-for having missed the fact that it slipped through the net. I thought that we had established that procedure by deferment. I remember in particular the Mapping Surveys Bill of 1969. We were told that if we insisted on an amendment to provide that the right of entry and search in relation to national mapping surveys should require a warrant, the whole mapping survey of Australia would break down. At that stage we were nasty enough to insist by a majority in the Senate that we wanted that amendment. That Bill has never seen the light of day. As far as I am concerned the national mapping survey of Australia has never faltered. I would have thought that a fairly fundamental right of every citizen of a free democratic country would be that before his privacy is invaded a prima facie case for doing so should be made out to some judicial or quasi-judicial officer. I would have thought that that was a fundamental right. It was certainly warmly supported by the former Leader of the Opposition and Leader of the Government in the Senate, now Mr Justice Murphy. It was warmly supported by a cross-section of members of the Liberal Party and, as it was then, the Country Party, later the National Party of Australia. I will be bitterly disappointed if the Government does not accept this amendment without question. If there is something wrong with the form, I am quite prepared to accept any suggestions for its amendment. But the principle is one which the present Government firmly argued for in opposition and which, I thought, was established by a clear majority of the Senate. I hope that all honourable senators will support its introduction in this instance. If the Minister for Industry and Commerce (Senator Button) has some objection to the amendment I am quite happy to consider it. But as far as I know, the amendment is in a standard form. Senator JACK EVANS(Western Australia)(11.23) —The Australian Democrats are quite sympathetic to the principles enunciated by Senator Rae. I feel that it is appropriate to compliment the earlier speakers from the Liberal Party who participated in this debate. It has been an extremely useful debate which has contributed to an awareness not only by the Senate but also, because proceedings are being broadcast, by the public at large, of the principles that are involved in establishing anti-dumping practices. I must express very serious concern on behalf of all of the Australian Democrats at the potential for the invasion of civil rights in this Bill. That concern is not ameliorated by the fact that many other Acts have been passed by this Parliament over recent years which give similar access to officers, in particular, to Customs officers and trade practices officers to premises to investigate potentially illegal or harmful acts by the occupants of those premises. However, it has been very well expressed by each of the speakers from the Liberal Party that there is a major problem because of the weak attitudes of Australian governments compared with governments of other nations towards dumping practices by other nations. The Bill picks up a great number of weaknesses and remedies them. The Government is to be complimented for its introduction of those modifications to our tariff legislation. Senator Rae's amendment falls down regrettably because it will tie the hands of the investigating Customs officers behind their backs and will allow overseas corporations to take advantage of the Australian weakness for being so fair to all Australians that we give an advantage to the importers of overseas goods. That is taking fairness to an extreme where Australians suffer. I do not believe that should be allowed to influence the actions that we take in this Parliament today. We need to recognise that it is time that Australia grew up in the international scene and equipped our officers to fight, to contest, the practices that are taking place. If it were simply a matter of Customs officers investigating invoices when goods come into the country and being able to take at face value the details of those invoices, we would not need this amending legislation. This legislation is required because there are shoofty acts, under-the-counter acts, unscrupulous acts, taking place which allow dumping to take place without the knowledge of the Customs officers or of anybody in Australia apart from the participants in the act of dumping itself. Therefore, with great regret, I will be opposing the amendment because I feel that we can no longer hamper our officers in fighting the practices of overseas corporations in dumping goods on this country to the detriment not just of the producers of this country but also of the people as a whole. As was very well expressed by Senator Watson in his speech, the sufferers are the manufacturers, the producers and the people whose rights are denied and whose cost of living is increased as a result of these malpractices. With regret I will be voting against this amendment, the regret being because the legislation comprises to a degree an invasion of privacy but that at least we can say in this case the invasion is limited because it can take place only at reasonable times. It is an invasion only of commercial offices or buildings containing commercial documents and it is in effect an audit of a practice which is destructive to the interests of Australia. Senator BUTTON(Victoria-Minister for Industry and Commerce)(11.28) —The amendment is not acceptable to the Government. In listening to what I genuinely believe is the heartfelt rhetoric coming from some Opposition senators, I was reminded of the fact that if one reads the constitution of the Soviet Union one could never believe that an infringement of civil liberties could occur in that country. In listening to Senator Rae's historical analysis of the role of the Senate in allegedly rejecting provisions of this kind in Australia's legislation one would think that, because of the existence of this chamber, nothing like that could happen here either. The burden of the observations of Senator Rae and , to a lesser extent, Senator Watson is that the Senate and the Liberal Party would never countenance provisions such as this. This amendment seeks to amend proposed new section 214B of the Customs Tariff ( Anti-Dumping) Act. I ask members of the Opposition to look at Section 214A of the Customs Tariff Act, introduced by the Liberal Party when in government in 1982. Its provisions and effects are identical with the clause of the Bill which the Opposition seeks to amend on the basis of high principle. That legislation is one section removed from the clause now the subject of debate. That was inserted in the Act in 1982 for very valid reasons. The Trade Practices Act contains almost identical provisions with these in respect of the operations of the Trade Practices Commission in ascertaining facts in respect of the Trade Practices Act. Section 263 of the Income Tax Assessment Act states: The Commissioner, or any officer authorized by him in that behalf, shall at all times have full and free access to all buildings, places, books, documents and other papers for any of the purposes of this Act, and for that purpose may make extracts from or copies of any such books, documents or papers. Since the early 1960s, 19 pieces of bounty legislation have been passed by the Senate which contain almost identical provisions-power to enter premises, inspect books, ascertain facts, et cetera, without warrant. Senator Peter Rae —How many were amended or rejected? Senator BUTTON —It is in all of them. Senator Peter Rae —How many pieces of that type of legislation were either rejected or amended? Senator Chipp —They were all passed by your Government. Senator Peter Rae —No, Senator Chipp, I can remember when you were the Minister and we held up some of your legislation and you eventually agreed to the amendment. Senator BUTTON —I should explain to listeners, and to viewers if they be of the Magoo variety, that, when people talk about Opposition benches being in disarray , this is a fine example of it this morning. Australian Democrats and Opposition senators are debating their sordid past with each other and very little serious attention is being given to the provisions of this very important Bill. The argument based on some sort of alleged civil liberties principle is spurious. The argument of need in respect of this sort of provision which the Opposition amendment seeks to take out of the legislation, of course, was well expressed by Senator Jack Evans in the least alarming part of his speech, the second part. The important point is that he realises that it is a practical necessity in the legislation. The powers sought in this provision relate only to the operation of the Customs Tariff (Anti-Dumping) Act. The purpose of this provision, as with all other provisions of a similar kind passed by the Senate over many years, is to enable officers to establish facts or the truth of alleged facts in relation to a particular set of circumstances, namely, a dumping complaint, and to establish those facts by means of examination of books. As a result of the alleged intrusion into business premises to examine books no individual is prejudiced by being liable to a penalty. The worst prejudice or detriment that an individual can suffer in these circumstances is that it may contribute to a finding that he is party to dumping detrimental to Australian industry. That is the prejudice which Senator Rae's amendment seeks to support. All I am saying to Opposition senators is that the amendment is misconceived. One can conjure up pictures of officers of my Department, benign gentlemen as they are, entering premises in uniforms and crashing down the doors and so on, in order to inspect books. That is a lot of rubbish. Senator Watson —What is wrong with getting a warrant? Senator BUTTON —Why should the books not be inspected in order to establish a set of facts, as distinct, in terms of the legal principle, from the situation where a person incriminates himself in respect of a penalty as a result of providing information? The purposes of the enforcement activity in relation to this, identical as they are to other provisions, are simply to ensure that the provisions of this legislation can be carried out effectively, with no penalty accruing to any individual in terms of a prosecution, a fine or anything of that kind from the fact that books are examined to ascertain facts. The purpose of the provision is to provide officers undertaking inquiries into dumping complaints with full access to commercial documents or records for the purposes of this legislation. It is necessary if one is to discover instances of hidden dumping. All that it provides is for the production of appropriate documents, records and so on, or, where documents are not provided on request, for the officers to enter and examine them. As I have said, this is identical to provisions in many other Acts. The other point I make is that I would ask Opposition senators, before they vote on the amendment, which I have described as misconceived, to consider the appropriateness of obtaining a judicial warrant. What does one do? One goes to a judge and says: 'There has been an allegation of dumping by an importer. We believe that hidden dumping is taking place. Your Honour, can we have a warrant to look at this man's books?' Senator Peter Rae —You might even take a statutory declaration. It would at least prevent abuse. Senator BUTTON —Well, one is not clear about what one would take. There will not be any abuse. No abuse has been complained of under the provisions of the legislation introduced by the honourable senator's Government in 1982. No one has complained about customs officers in respect of his Government's legislation entering premises to examine books. They do it regularly. They do it in respect of excise matters, as well as in respect of other matters. Senator Peter Rae —There have been books written on the objections-not just simple complaints, but books written on the subject. Senator BUTTON —That is an interesting interjection on the quality of imports. Books have been written, of course. It is a very academic point that the honourable senator is making. It is an academic legal point which has no relevance to the factual situation with which officers are confronted in administering this legislation. Senator Peter Rae —You have just made a very quotable quote. Senator BUTTON —In order that Senator Peter Rae does not forget that quotable quote, I had better sit down. The Government does not accept the amendment, which is totally misconceived. Senator WITHERS(Western Australia)(11.38) —As one who was involved with this matter many years ago, I hope that former Senator Lionel Murphy does not read the remarks of the present Leader of the Government in the Senate (Senator Button), because it was the then Senator Murphy, who was then the Leader of the Opposition, who joined with a number of Liberal senators, among them Senator Peter Rae and myself, in the 1960s, who started to force on the then Liberal- Country Party Government a more civilised attitude to the right of entry and search. Senator Button —It did not work, though. You did not take any notice of it. Senator WITHERS —I thought that we had basically come to that view. The fact that we have been passing legislation since then just highlights the need for the Senate Standing Committee for the Scrutiny of Bills because everyone does not pick up everything. That was one of the things that so many of us had in mind when we supported the setting up of a Scrutiny of Bills Committee, because these things do get through. It has always been the excuse of the bureaucrat that he wants life made easy for him. If every bureaucrat, every public servant, every officer is so marvellous, as Senator Button would have us believe, and never abuses his authority and always exercises his discretion so magnificently, what about our getting rid of the Ombudsman and the Administrative Appeals Tribunal? They are but parts of the checks and balances which it has been necessary to set up in recent years, due to what is perceived as bureaucratic arrogance, bureaucratic sloth and bureaucratic misconception of the exercise of discretions. Why do we have ombudsmen? Why do we have an Administrative Appeals Tribunal? It is because people were dissatisfied with the working of the administrative practice of government. What Senator Peter Rae is proposing this morning is but another check on the exercise of bureaucratic discretion. Of course, the Department will always say to a Minister: 'If you should accept this, the whole of the administration will break down'. Senator Peter Rae may well remember that back in, I think, about 1968 a Bill was before this Parliament concerning the mapping and surveying of Australia. Senator Peter Rae —I have referred to that Bill. Senator WITHERS —The honourable senator has referred to it. We were told that if this provision went in, the whole of that would stop. Of course, that Bill was never passed, but the mapping and surveying of Australia has proceeded ever since. However, that has always been the bureaucrat's argument. Senator Peter Rae —But in those cases the Australian Labor Party was concerned about these issues. Senator WITHERS —Yes, and at least it was going to vote with us. But it was in Opposition. I must admit-I say this quite frankly-that once in government one becomes more concerned about administrative convenience than about the rights of electors. That is a normal government attitude. I have been in opposition, in government and in opposition again, and I have seen the change in myself. I admit it freely. I used to have people from my Department pleading with me that if we did not do this or get this power or get this Bill-most of it was absolute humbug and nonsense, of course-- Senator Button —Senator, could you address yourself to the issue of how you find hidden dumping without such a provision? Senator WITHERS —I have no objection to people going in and inspecting the books . Of course one has to do that. But Senator Button will not meet the threshold question. Why should his officers just have an absolute discretion? Senator Button —Tell me what you would say to the judge. Senator WITHERS —One would not be asking the officers to do much. All that one would be asking would be that the officers go before a justice of the peace or a magistrate, the normal people who issue warrants, and say: 'We have cause to believe that we should inspect these books'. The justice of the peace or the magistrate should satisfy himself that they have a reasonable excuse for doing so. He does not have to be satisfied beyond reasonable doubt, or anything like that. He is not put to that standard of proof. But why are the departmental officers so reluctant to apply for a warrant? It is mainly because they do not want to be inconvenienced, and maybe, also, they do not want to be able to be examined as to why they want this power. I suppose that in 1984 this is a very good subject for us to argue about. We are supposed to be in the Orwellian year. Senator Peter Rae —We now have to listen to Buttonspeak. Senator WITHERS —Buttonspeak, is it? I can well understand why the Minister has no doubt been given all that material by his Department. Every attack on the individual's liberty in the last 10,000 years during which man has been on earth has all been in the name of administrative convenience. Senator Button —You are making the Western Australian tax avoiders' speech all over again. Senator WITHERS —Oh, no. Most of the tax avoidance in this country occurred through bureaucratic laxity. If that laxity had not been so rife, tax avoidance would have stamped out years previously as a result of the Brinsden opinion. It was bureaucratic laxity and lack of proper supervision that let that horse out of the stable. But why should the officers be so reluctant to go before a justice of the peace? Why are they so afraid of that? I can understand Senator Evans wanting to stamp out dumping. I thought that we all did. That is why we are supporting this legislation. No one is opposed to departmental officers having the capacity to discover this thing. All we are saying is that before they knock on a person's door, at whichever time they choose and within fairly broad parameters, they should go before a justice of the peace. Senator Button says that there have been no complaints about this. Perhaps Senator Button lives in a different world, but I would have thought there was a general community complaint about too many nosey little bureacrats being able to barge into people's houses. In my own State, for far too many years the health inspectors have had a right of entry and search. There have been some quite interesting cases of how they have abused that power at times. I know that some of the statutory marketing board inspectors abused their rights of entry and search. Senator Button should know as well as anybody else that anbody who is given too much power will eventually overuse it. I think it is shame that, after a mere 12 months as a Minister, Senator Button has now been submerged into bureacratic convenience. He used to be a man who stood up for civil liberties, the rights of the individual, et cetera. But now he does not care. All he wants is for his Department not to be fussed. Evidently, the Australian Democrats do not mind either. They say they believe in the right of small businessmen and all the rest. I know what I will do with all of the complaints who come to me in Western Australia. I will just refer them to Senator Jack Evans. I will say to the people who have been harrassed and annoyed: 'Put your complaint at his door because it is due to him that you were harassed.' Senator Button —You won't get any, because you are never there. Senator WITHERS —They will get complaints. Senator Button —You won't. Senator WITHERS —No, I am never there. Thanks very much! Senator Jack Evans —Have you had any complaints about section 214A of your own legislation? Senator WITHERS —I get a number of complaints about the way in which the Customs Service handles people. The problems generally are able to be solved. Of course there will be complaints. How many officers does the Minister have? Some hundreds? Senator Button —Have you had any complaints about section 214A? Senator WITHERS —I cannot recall under which section people have complained. I get complaints about most governments departments-about their inertia, their stupidity and their incompetence-and any senator who does not is obviously not in touch with his electorate. That is why we are so keen to do something about this legislation. Senator Jack Evans —I was wondering whether you were going to send me complaints about 214A as well as 214B. Senator WITHERS —The main complaints I receive in Western Australia are about Senator Jack Evans. People just wish he would lift his game. In conclusion, I hope that Senator Button will re-read the speeches made by his predecessor some time back, Senator Lionel Murphy. He may then not altogether think that we on this side are chasing some stupid sort of rainbow and that we do not know what we are talking about. Senator MACKLIN(Queensland)(11.48) —If one could ask a question of Senator Withers one would ask where he was in 1982. He referred to his Government's legislation and he raised the issue of the Scrutiny of Bills Committee. I have with me the Scrutiny of Bills Committee report dated 24 March 1982, when Senator Withers's party was in government. It relates to the Customs and Excise Amendment Bill. The Scrutiny of Bills Committee, which was lauded by Senator Withers because it was going to draw attention to these types of things which, he said, unfortunately slipped through, in dealing with clause 24 for which Senator Withers, Senator Peter Rae, Senator Hill and Senator Watson voted-- Senator Watson —How did you vote? Senator MACKLIN —I will tell Senator Watson how I voted in a minute. The report states: This proposed section allows a Collector of Customs to enter a depot at any time without the necessity of first obtaining a warrant. That matter was raised by the Australian Democrats but the then Government gave a whole series of excuses and refused to do anything about it. But Senator Withers says: 'Do not worry about that; that is why we have all the appeals tribunals'. But the Scrutiny of Bills Committee, dealing with the same Bill under the heading General Comment, said: A number of provisions are included in this amending Bill which will not be subject to . . . right of appeal-see amendments included in clauses 7, 12, 14 and 31. Clauses 18 and 24 also propose the vesting of non-appealable discretions in the Minister by amendments to sections 83 and 108 . . . Not only did Senator Withers not read the report of the Scrutiny of Bills Committee, which he had lauded, but also he managed to support a Bill which did not allow the vaunted appeal about which he was just talking. I think it is unfortunate that when elections occur and we change governments everybody seems to change advisers, underpants and views. It seems to me that the view put by Senator Rae is a good one. I believe it is useful to consider a progressive change in all of these Acts. I support that change. I support this amendment. I remind Senator Watson that I have supported it in the past, against his Government, and I will continue to do so. I believe that this is the way we ought to go. We ought to remove from the Customs officers their ability, without a warrant, to engage in precisely what they are now able to engage in. I have moved amendments in the past against the legislation of the previous Government. Indeed, I have before me one such amendment on precisely the same matter, which was defeated. It seems to me that this is a useful device. I am very pleased to see that Senator Rae, when drafting his amendment, did something else that the Liberals did not do when they were drafting Customs legislation. He has actually learned a lesson and provides in paragraph (1C) (d) of his amendment for a date to be put on the warrant, which the Liberals never managed to do in their own legislation and about which I was constantly moving amendments. The last amendment I moved was to four Bills relating to dairy products, edible oils, eggs and honey. They finally accepted my amendment to clause 9 (3) which read: A warrant under sub-section (3) shall specify a date after which the warrant ceases to have effect. The previous Government at least got to the stage of accepting that after three or four vain attempts on my part to get it to put a date on its warrants. I am glad to see that Senator Rae proposes to put a date on the warrants, as his Government did not do for so many years. There is, however, a difficulty in this area on which I would like the Minister for Industry and Commerce (Senator Button) to comment. I find it difficult to know precisely what the warrant specified in Senator Rae's amendment would consist of. As I understand the dumping laws I am not sure that one would be looking at an offence when one was seeking evidence on which to proceed in relation to dumping. It is a technical point and I imagine the Minister has some brief on it. I am not sure whether one could get a warrant before a justice. If that is possible, although the Government agrees that it does not want to do it, I would still be happy with Senator Rae's amendment, but I must admit that I have a certain amount of confusion as to what precisely one would be arguing before the justice. As I understand it a prosecution could not necessarily be launched as a result, although if anti-dumping were discovered action could be taken, as a result of those investigation, to prevent the events from occurring. I ask the Minister: What precisely is the situation in relation to any warrant that may be issued pursuant to Senator Rae's amendment? What precisely would be going on in that area? As these are Senator Rae's amendments he might like to comment on that too. Senator PETER RAE(Tasmania)(11.56) —I think the short answer to the question Senator Macklin has just raised is just two words: Big brother. What is happening continuously throughout not just our society but our type of society is that we seem to find it necessary to regulate more and more of the activities of individuals and to give more and more power to people to enforce that form of regulation. Dealing with the matter to which Senator Macklin has just specifically referred, if, for instance, a person refuses or fails without reasonable excuse to attend before an authorised officer to make an oath or affirmation, to answer a question, or to produce an account book, document or other record when required to do so in pursuance of the section of the legislation, that person could be fined $1,000. In no way am I endeavouring to take away from either the importance of the function which Customs officers fulfil or their capacity to fulfil it, but if we find in our society that it is not necessary to give such powers to the police investigating cases of murder I find it hard to understand why we should give them to officers of the Australian Wheat Board or some other primary industry board, the National Mapping Council, or Customs officers. We are suggesting that there be a little inconsistency. I accept the criticism which has been made that , inadvertently, I and a number of other honourable senators, apparently without objection, permitted a provision similar to this to go through in 1982. All I can say is mea culpa. That does not mean we did not vote against it time and time again in the late 1960s and the early 1970s, until we thought, foolishly I now realise, that we had established a principle that governments would not attempt to legislate in this way, that they would introduce the requirement for a warrant, that they would not simply say: 'This type of legislation is to be given greater powers in relation to enforcement than is the major criminal legislation of the country'. I can only say in response to the criticism that has been made that a Liberal- National Party government in 1982 inserted section 214A, which gives right of entry and search without a warrant and provides only that the authorised officer who proposes to enter any premises shall, if requested to do so by the occupier or person in charge of the premises, produce for inspection written evidence of the fact that he is an authorised officer. If we allowed that to go through, as apparently happened, it is simply a case that two wrongs do not make a right. I hope that the Australian Democrats will come together a little more on this matter and support the attitude of Senator Macklin. I do not wish to be making a point out of a legitimate difference of opinion, but I am amazed that members of the Australian Labor Party, who fought for years to establish this principle, should now turn round and argue in support of their bureaucrats. Senator Macklin —They are in government. Senator PETER RAE —Because they are in government they will support their bureaucrats rather than their principles. I need say no more. The vote on my amendment will simply be that those who wish to support principles will support my amendment and those who wish to support bureaucrats will vote with the Government against the amendment. Senator BUTTON(Victoria-Minister for Industry and Commerce)(12.01) —Senator Peter Rae's description is a very charitable description of what the vote on this issue is about, but one might expect it to be so. In answer to Senator Macklin's question, no investigation could be carried out under the provisions of this proposed new section which would uncover, reveal or result in an offence in any way. Where Senator Rae confuses this-I hope not deliberately-is to say: ' If you do not co-operate in respect of this power you commit an offence'. That is absolutely true. But that is not the point of Senator Macklin's question as I perceive it. His question was: If the investigation to discover certain facts reveals an offence, is any person in jeopardy as a result? No offence can be revealed. It is purely for the purposes of the Customs Tariff (Anti-Dumping) Amendment Bill (No. 2) 1983 to deal with the question, to discover as a matter of fact whether hidden dumping is taking place. There is a weakness in Senator Rae's analogy that one needs a warrant in order to investigate a murder but one does not need a warrant in order to investigate facts under the dumping legislation. A warrant is needed to investigate a murder because the presumption is that an offence has been committed. The police have to establish that an offence has been committed in order to get a warrant in the case of a murder. A prima facie case has to be established before a judge or a magistrate in order to get these powers to investigate a murder. In that case an offence is presumed to have been committed; in this case there is no offence at all which an investigation can reveal. Senator Peter Rae —There can be very significant financial consequences if there is no offence. Senator BUTTON —Senator Rae came into this chamber during the second reading debate and made an impassioned speech about how important it was for Australian industry to be protected against dumping, yet when he gets to his amendment he says that dumpers should be facilitated, and he says that on the basis of a very spurious analogy with the criminal law. The Government does not accept this amendment. Senator MASON(New South Wales)(12.03) —I would not have been impelled to rise and speak in this debate, although I propose to vote against the amendment moved by Senator Rae, had it not been for Senator Rae's histrionics, in which he depicted those of use who would vote against it as being on the side of the bureaucrats and himself as being on the high side of principle. The basic point here is that if we support this amendment we will be simply contributing to a situation in which it is proposed to nobble the Customs Service to the extent that it cannot really act efficiently in the anti-dumping cause. I tend to agree with the point made by the Minister for Industry and Commerce (Senator Button) and his accusations against Senator Rae in his speech in the second reading debate, when he pointed out the necessity for us at least to have reasonable anti-dumping legislation. People who are carrying out these sorts of illegal operations will have papers, of course they will. They will look perfectly legitimate. That is the whole point. As I see it, that is all the Customs Service could take before a judge, and how could a judge say that he would issue a warrant on those documents? Senator PETER RAE(Tasmania)(12.04) —I am amazed that neither the Minister for Industry and Commerce (Senator Button) nor Senator Mason can see the difference between the facilitation of proper laws against dumping and assuring the right of privacy of individuals. We are simply saying that a prima facie case should be made out to a magistrate or a judge, as it would have to be made out in relation to aspects of the criminal law, before one could get the right to go into somebody's premises and look at the books and do whatever else one would wish. Those books may be in the home of an individual or they maybe in some other person's premises-for instance, the premises of an accountant. Senator Macklin —A prima facie case on what? Senator PETER RAE —Firstly, that a dumping investigation is under way; secondly, that books in the possession of somebody or another are relevant to that dumping case. That is all one would need to do. But what it does is stop a nosey customs officer, if such a creature exists. I do not suggest that there are such officers but I think we must legislate on the basis that human nature has, in the past, thrown up some examples of people who do not always behave completely rationally, properly and with due consideration for the interests of other people-making a totally unauthorised wide sweep investigation. If honourable senators just think back to a month or two ago and about the Sheraton Hotel in Melbourne, it will bring to their minds fairly quickly a concern that officers given authority sometimes behave in a way which the general public would not regard as entirely reasonable and responsible. I would not like my accountant's home to be entered at 9 o'clock on Sunday morning because some Customs officer though that some document of mine in relation to some imported goods happened to be in my accountant's home that weekend or he just thought it would be interesting to go and see whether the pool had water in it. That is the sort of thing I am talking about. I really am amazed that Senator Mason confuses the situation. I am extremely disappointed that this Government, which made such a point of it some years ago, is not now prepared to support the assurance of the right to privacy about which Senator Evans spoke on 28 February 1984 when he said-- Senator Jack Evans —Which Senator Evans? Senator PETER RAE —Senator Gareth Evans. I am very conscious of the problem of identification. Senator Gareth Evans said: The most worrying aspect of this whole matter is, I believe, the massive illegality and invasion of privacy which appears to have been involved . . . If we cannot preserve the reasonable privacy of people I believe we have not earned the right to be legislators. Senator Hill —Very moderate, cautious and reasonable. Senator PETER RAE —As Senator Hill has interjected, it is a very moderate, cautious and reasonable amendment which has a tremendous bulk of precedent behind it. All those who would oppose it can say is that on one occasion in recent years we apparently did not notice a similar amendment being put through to facilitate the work of bureaucrats. Not only will I move this amendment but also I will move an amendment whenever I get the opportunity to section 214A to provide the same requirement. I thank those honourable senator's who have drawn my attention to the fact that it has slipped through. I think it justifies the existence of the Senate Standing Committee for the Scrutiny of Bills. I hope the Senate makes a practice-I attempt to-of looking at the Scrutiny of Bills Committee reports to see whether these sorts of things are taking place and on any occasion where a right of entry and search without warrant is being given-- Senator Macklin —Will you do it when you are in government? Senator PETER RAE —I will do it at any time I get the opportunity. I can only go back to my record, which is that I crossed the floor on a number of occasions to ensure that amendments were carried to legislation of the then Government. As Senator Reg Withers has already said, a number of us crossed the floor. I do not think honourable senators can accuse us of lack of bona fides. Senator Button —You must have been asleep on a few occasions. Senator PETER RAE —Senator Button says we may have been asleep on a few occasions. If so, I can only apologise to the people of Australia that some slipped through, but we will try to correct it. As soon as we are back in government we will certainly correct it. Question put: That the words proposed to be left out (Senator Peter Rae's amendment) be left out. The Committee divided. (The Chairman-Senator D. J. Hamer) Ayes . . . . . . . . . . . 28 Noes . . . . . . . . . . . 32 —— Majority . . . . . . . . . 4 —— Archer, B. R. Kilgariff, B. F. Baume, Peter Lajovic, M. E. Bjelke-Petersen, F. I. Lewis, A. W. R. Boswell, R. L. D. MacGibbon, D. J. Carrick, Sir John Macklin, M. J. Chaney, F. M. Martin, K. J. Collard, S. J. (Teller) Missen, A. J. Crichton-Browne, N. A. Rae, PeterDurack, P. D. Reid, M. E. Guilfoyle, Dame Margaret Scott, D. B. Haines, J. Townley, M. Hamer, D. J. Walters, M. S. Hill, R. Watson, J. O. W. Jessop, D. S. Withers, R. G. Bolkus, N. Harradine, B. Button, J. N. Hearn, J. M. Chipp, D. L. Jones, G. N. Coates, J. McIntosh, G. D. Coleman, R. N. Maguire, G. R. Colston, M. A. Mason, C. V. J. Cook, P. F. S. Primmer, C. G. Crowley, R. A. Ray, RobertElstob, R. C. Reynolds, M. Evans, Gareth Richardson, G. F. Evans, Jack Robertson, E. A. (Teller)Foreman, D. J. Ryan, S. M. Georges, G. Sibraa, K. W. Gietzelt, A. T. Tate, M. C. Giles, P. J. Walsh, P. A. Grimes, D. J. Zakharov, A. O. Question so resolved in the negative. Senator PETER RAE(Tasmania)(12.16) —The Opposition, with the aid of two of the Australian Democrats senators, but not with the aid of Independent Senator Harradine, has made the point that it would like to see upheld the principle of no entry and search without warrant. The division having taken place, we do not propose to call for any further division in relation to the matter. I hope we have made the point and that the Government will give it consideration in relation to future legislation. Bills agreed to. Bills reported without amendment or requests. Motion (by Senator Button) proposed: That the report be adopted. Senator HARRADINE(Tasmania)(12.17) —This debate has proceeded for a considerable time and various opinions were expressed. Yet I think it is fair to say that every honourable senator is concerned about dumping for two reasons. One reason, of course, is the effect on employment that dumping has in Australia . The other reason concerns Australia's various bi-lateral and multi-lateral trade agreements which dumping undermines. I was conscious of the arguments that were advanced and I am sure other honourable senators were conscious of the arguments that were advanced by Senator Peter Rae. He unfairly described those senators a moment ago. The Committee considered Senator Rae's proposals and rejected the amendment. It is not appropriate for him to categorise those honourable senator's in the manner that he has just done. Senator PETER RAE(Tasmania)(12.18) —I can only express my amazement that Senator Harradine, who took no part in the discussion and who had nothing to contribute towards consideration of the legislation, then made an unspecified accusation that I said something unreasonable and unfair. All I did was simply say that the Opposition did not intend to divide further in relation to the matter, it having been determined by a vote in a division. That was all I said. I simply leave it at that. The way in which honourable senators voted was identified. The majority of the Committee supported the Government. That is the end of the matter. We made our point and endeavoured to pursue an enthusiasm for ensuring that dumping does not take place to the disadvantage of Australian business and employment and that unreasonable invasion of privacy does not take place in Australia. Question resolved in the affirmative. Bills (on motion by Senator Button) read a third time. Debate resumed from 29 February, on motion by Senator Button: That the Senate take note of the statement. Senator CHANEY(Western Australia-Leader of the Opposition)(12.20) —The statement which the Senate is being asked to take note of was put down a few days ago by the Leader of the Government in the Senate (Senator Button) and is in the same terms as the statement made by the Prime Minister (Mr Hawke) on the same date. The statement might be described as spare. I do not say that in any disparaging sense. It is appropriately spare, given that it touches on matters relating to Australia's security services. The Opposition would not wish to see anything done which damaged the efficiency and effectiveness of those services. The Government has provided a copy of the report on the Sheraton Hotel incident to the Leader of the Opposition and the statement was provided to us in the usual way before it was put down in this Parliament. I do not believe there is very much that I need to say on behalf of the Opposition at this time. However, I express our regret that the incident did occur. Of course, it is an incident which must have had an unsettling effect in a number of ways. None of us can be satisfied with a situation in which members of the Australian public, various individuals, were inconvenienced and no doubt made to feel threatened. I am sure the regret which I express would be a regret which would be felt throughout the bureaucracy and, indeed, the service that was involved in this matter. We note that the Government has accepted Mr Justice Hope's recommendations, and we have no quarrel with that. I simply say on behalf of the Opposition that the Government will be supported by the Opposition when it takes action which is in the national interest and which is necessary to ensure that we have effective, efficient and respected intelligence services in this country. That is a matter which I hope as far as possible can be a matter of bipartisan support in this chamber. Senator MASON(New South Wales)(12.23) —The Australian Democrats would agree with the general principles which the Leader of the Opposition (Senator Chaney) has put forward in this matter, although I feel he has somewhat understated them . We feel that this sorry incident of smashed doors and affronted guests in the Sheraton Hotel in Melbourne requires some comment which one might encapsulate by simply saying that nothing like that must ever happen again in Australia in the particular circumstances in which that event happened. In saying that, I do not in any way want to say that there might not at some time be the necessity for such an incident. We are fortunate that we are a peaceful country. It could happen at some stage that that type of incident could happen in reality. That is something we must bear in mind. It is reasonable that we should have persons who are trained to carry out that kind of operation, as long as they are trained in a proper and reasonable way. For an incident to happen purely in the course of training is completely inexcusable and unpardonable. Page 3 of the original typescript of the statement by the Leader of the Government in the Senate (Senator Button) sets out the background to the incident. It states: A minor function, specified in the directive, requires ASIS to maintain a special operations capability for wartime and other very special situations. Of course, I mentioned those situations when I first spoke. The Minister's statement continues: As Mr Justice Hope notes, that capability is maintained only on a contingency basis. The Government notes that the whole question of ASIS's special operations function will be dealt with in the Royal Commissioner's report on ASIS due later in the year. I hope that that function will be regularised in the general review, because one of the major lessons of this incident must be that the performance of this kind of operation-if we are to have that capability-ought to be a proper one which will work with a minimum of fuss and nonsense and which will not create the kind of situation that happened at the Sheraton. If that incident were for real it would really have been burlesque and in the circumstances it might have been quite tragic for this country if the issue which had prompted it has been a large one. On page 3 of the original typescript of the ministerial statement it is revealed: The Minister for Foreign Affairs has made it clear that he was not aware of the planned exercise . . . That is something that seems inexcusable in all the circumstances. In view of the ambiguous overtones of the Australian Secret Intelligence Service-that is not a criticism of the organisation as such-the authority of the Minister for Foreign Affairs (Mr Hayden) ought to be absolute where time and circumstances permit. They certainly did permit in this case. Also in the ministerial statement Mr Justice Hope is reported as saying: . . . identifies as an obvious deficiency in the planning of the exercise the failure to notify either the Victorian Police or the manager of the Sheraton Hotel. I find the use of the word 'notify' in that circumstance absolutely staggering. It makes me wonder whether indeed we are not all living now in a 1984-type dictatorship without knowing it. The use of the word 'notify' would seem to assume no special need to obtain the authorisation or permission of the management of the Sheraton Hotel to have this violent, illegal and dangerous game played on its premises to the physical detriment of those premises and the overall detriment of the business. That is a matter which I hope the Attorney- General (Senator Gareth Evans) will clarify later in this debate, as I know he will do. I feel really left up in the air by the words relating to disciplinary action where it is stated: While His Honour touches on the question of disciplinary or other action for those involved in the exercise, he has not made recommendations as to what disciplinary or other action, if any, should be taken. Those questions have been left for the responsible authorities to resolve. I believe it would be useful for the Senate to know in due course just who the responsible authorities are and what action they take. It is vital to the community interest that this issue is followed up and resolved and the resolution made public. I think it is also vital for the people who work for ASIS that that should happen. If a degree of blame is to be attached to this matter I would say that it would be at least partially a very messy system under which ASIS operates. It is the business of the Government to see that this messy system is not perpetuated. But while it is one can hardly blame people if they take advantage of it or think that they can operate under guidelines that are not sufficiently strict. I will turn now to Mr Justice Hope's Report on the Sheraton Hotel Incident. On page 2, paragraph 1.7 of the report it is stated: It was intended to conduct the exercise without publicity and without involving persons other than those directly taking part. In the event, members of the public did become involved and it was publicly revealed that the trainees had been carrying weapons, had threatened members of the public with them and had forced an entry into a room of the hotel causing damage to the hotel. It seems a very naive assumption on the part of those concerned that an operation of that kind could actually be carried out at a major hotel in one of our major cities without rocking the boat very considerably indeed, as of course , was the case. We are also concerned about the carrying of weapons and the nature of those weapons. In this situation one would have thought that if this were merely a mock-up, a situation where indeed the later injections of the so- called security guards were simulated, there really would have been no need to be waving weapons around. A description of the weapons is contained on page 7 of Mr Justice Hope's report which states: The list of equipment included four Heckler and Koch submachine guns, two of them silenced, and six Browning 9 mm automatic pistols. Senator Chipp —Were they loaded? Senator MASON —We do not know whether they were loaded. That is an interesting point of Senator Chipp's. There is no statement that I can find on that. Senator Lewis —Yes, they were loaded. Senator MASON —I gather from the interjection by Senator Lewis that they were loaded. Senator Lewis —They were loaded with plastic bullets. Senator MASON —Thank you. That is a matter which the Attorney-General may like to take up later. The presence of any kind of loaded firearms in a public situation of that kind-- Senator Gareth Evans —They were loaded with plastic blanks. Senator MASON —Of course, that information alters the situation substantially. Nevertheless there is no way that people terrorised with the firearms would know that. Again even weapons which are believed to be loaded with blanks are frequently known not to be. In fact, I think that such a situation might be even more dangerous. Perhaps one of those guns could even have been fired on the understanding that it was loaded with blanks even though it was not. That situation has occurred tragically many times. Cogent to this point we have a description on page 14 of Mr Justice Hope's report-a point which I think ought to be recorded in Hansard-of just how the weapons were actually used. The report states: One of the team members lowered his submachine gun and pointed it at the Hotel Manager. A trainee held his hand gun in the air so that it could be seen. Seeking a way out of the hotel, the team advanced into the kitchen with some hotel staff, including the Manager, retreating before them. There is a conflict of evidence about whether guns were pointed at hotel staff in the kitchen. Hotel staff maintain that submachine guns were pointed directly at them, and that a hand gun was waved about. The trainees contend that the submachine guns were held across their chests and that one hand gun was held up, but not pointed at anyone. I think a relevant point concerning the question of liquor is made on page 55 of the report. It states: Although John-- John was the hostage who was to be rescued from the hotel room- and the two 'foreign intelligence officers' had consumed about $70 worth of liquor over the 3 day duration of their stay in the hotel, this was not regarded by hotel management as excessive. I will leave that point without further comment. Senator Chipp —Not at those prices. Senator MASON —Senator Chipp makes an excellent point. One would want to know the prices of the liquor to see how far the $70 went. Nevertheless I think if there is any evidence that there was an unreasonable amount of liquor consumed in that time that is something that ought not to have happened. I mentioned the recommendations made on page 69 of the report. Mr Justice Hope recommends: (a) no ASIS officer, trainee or agent be permitted to carry any type of firearms in any public place in Australia. I hope that the Attorney-General will comment at this stage giving us his view and that of the Government on these recommendations if he can. The recommendations continued: (b) no ASIS exercise, conducted outside ASIS' own facilities, which may attract the attention of the police or members of the public, should be undertaken without clearance from the police, from the local military district . . . and from any private citizen whose property may be affected or who may become in some way involved in the exercise; (c) no exercise should be conducted by ASIS which would harm or alarm members of the public, and ASIS trainees should be so instructed. I think those are the most important recommendations except for recommendation ( f) which states: (f) ASIS training manuals should be amended or completed as a matter of urgency to incorporate the above recommendations; Perhaps that is the most important recommendation of all. The Sheraton incident has revealed the necessity of not going in for this cloak and dagger activity as if it were some kind of game, as if it were an operation to be done light-heartedly. It is a very serious matter and should be subject to the most stringent planning and supervision. Senator LEWIS(Victoria)(12.33) —I rise to say a few words about the report on the Sheraton Hotel incident. I open my remarks by congratulating His Honour Mr Justice Hope for the balance and perspective which I believe he has shown in the report. I also congratulate the Government for making the report available to the Parliament and to the public because there is no doubt this matter has caused grave concern right throughout the nation. The availability of the report has, to those of us who have read it, at least allayed some of that concern. The pity of it all of course is that this fiasco-it can be described as nothing else -- Senator Chipp —I have a better word for it. Senator LEWIS —Senator Chipp has a better word. Senator Chipp —But I am not prepared to use it. Senator LEWIS —No doubt Senator Chipp will tell me later. The pity of the matter is that it has tended to bring Australia's Secret Intelligence Service and intelligence organisations into discredit. Scorn has been heaped on the Service. I have no doubt that officers serving in our security forces are most concerned that their reputations have been tarnished as a result of this nonsense. I think that is a great pity because notwithstanding its size Australia is a small nation. Small nations have shown time after time that really the only way to survive in this world is to have excellent intelligence information. Israel has shown the enormous benefits of its intelligence organisation. Any analysis of what went on prior to the Second World War will show the folly of allowing one's intelligence organisations to be run on small budgets and for people in important positions, such as Prime Ministers and Foreign Ministers, not to take notice of intelligence organisation reports. I draw attention to Lord Carrington 's resignation over the Faulkland Islands crisis. Clearly he was not taking proper notice of the reports and material which was being supplied to him and he recognised this. It is a great pity that our organisation has perhaps been tarnished by this nonsense which, on any analysis as Mr Justice Hope's report reveals, was probably unnecessary at that stage and was planned too early bearing in mind the concept of what it was all about. I will talk about the concept. Mr Justice Hope says that the primary function of ASIS is the collection of foreign intelligence. He then pointed out the ASIS is also required in a minor way to maintain a covert action-a secret action- capability. This has been the case since August 1982. One of the minor projects of ASIS is to develop this covert action capability. I am not sure of the reasons, but I think I can understand why there is a need for a covert action responsibility. However this would not be taken in Australia. I am sure very few people realise that the people involved in this action were not permanent officers of ASIS; they were civilians, part time agents, who came together for periods of training. At other times they pursued their normal civilian occupations. I take it that when the need arose they would be called together. That need was clearly to be seen as something which would take place only in a dire emergency, perhaps in war time or if some four overseas officials were being held hostage. Let me state Mr Justice Hope's recommendation in which he sums it up: I have concluded that the exercise was poorly planned, poorly supervised, and poorly run. That is undoubtedly a conclusion which one must draw from any analysis of the report and the nature of what went wrong. Although I recognise that the officers who conducted this exercise must be held responsible for their own actions, I heard the Premier of Victoria, Mr John Cain, pleading the Nuremberg defence, in other words, the officers were ordered to do this. One must have great sympathy for them and little sympathy for the person who organised the exercise. It was a surveillance exercise right up until 29 November when John-the person who was being watched-was in the hotel. At 4 o'clock on the afternoon of 29 November the team leader was informed that the team was now required to rescue this person using the minimum force necessary. What a lot of nonsense! What force? some force would have had to take place at that stage if there was to be any sort of entry into the building. Were they going to use grappling hooks and come down the wall, break window or smash down a door? Force would have had to be used unless the so-called foreign agents who were guarding John were prepared to let these people in through the door. When an attempt was made to enter the door as a waiter, the people guarding John refused to open it. The moment they refused to open the door, of course, force was inevitable. The whole thing was a disaster from thereon in. Mr Justice Hope, quite rightly, condemned it. Some of the points which Mr Justice Hope raised which cause me some concern are his future recommendations on how such an exercise should be carried out in the future. I am running short of time and I do not want to delay the Senate, but it seems that on the basis of his recommendations it will be practically impossible for ASIS ever to conduct such an exercise again except perhaps on Commonwealth- owned property. If those recommendations have been adopted by the Government the result will be that Senator Mason's concerns will not bother us because the incident will never happen again in Australia. Therefore we will not have to bother about this sort of thing. Mr Justice Hope raised the question of ministerial responsibility. At paragraph 3.8 he stated: It is convenient to deal with the question of ministerial responsibility for the incident at this point. There was no suggestion that the Minister responsible for ASIS, Mr Hayden, should have been informed of the kind of special operations training which was being undertaken in November, nor of the specific exercise which concluded at the Sheraton Hotel. The Acting Director- General had no duty to inform the Minister of the training proposed. For his part, the Minister had no duty to inquire into what specific training was proposed or proceeding in the special operations field. Having given his general approval for the projects ASIS had commenced, the Minister was entitled to believe that the Acting Director-General would ensure that special operations activities were conducted legally, properly, and safely. That seems to have been passed over the Parliament and been accepted. However, I wonder what would have been the result had this fiasco gone further astray? In my interjection to Senator Mason I drew attention to the possibility that perhaps a security officer at the hotel, a policeman, or the hotel manager may have responded to the waving of a pistol, submachine gun or other armaments, by firing a shot as a result of which one of the trainees may have been killed or wounded or even an innocent bystander may have been killed or wounded. What would have been the ministerial responsibility in that event? I raise this question because it seems to me, as a senator and member of this Commonwealth Parliament, that the situation in regard to ministerial responsibility has become very fluid. What concerns me is that Mr Justice Hope seems to have accepted the situation that a Minister is not responsible when he did not know what was happening in his Department and perhaps could not be expected to know. Senator Gareth Evans —Do you remember the position you took on the bottom-of-the -harbour legislation last year? Senator LEWIS —I have been reminded of an incident which occurred last year. I recall what Senator Gareth Evans said when he was in opposition. On 25 August 1982 at page 466 of Hansard he stated in relation to the former Attorney-General of this Parliament: . . . even if he did not know, and even if . . . he could not be expected to have known what was going on, then he should offer to resign anyway, because of the magnitude of the disaster involved for the Australian nation as a result of his purported performance of his ministerial duties. The only reason this matter is not being raised by all and sundry in this debate is that this fiasco turned out with no one being injured and only minor property damage. Debate interrupted. Sitting suspended from 12.45 to 2 p.m. The PRESIDENT —I inform the Senate that a meeting of the Joint Committee on the Broadcasting of Parliamentary Proceedings earlier today resolved that the proceedings of the Senate shall be broadcast on Monday, 5 March 1984. This is an interim arrangement. A change to the allocation of broadcast times beween the Senate and the House of Representatives has yet to be agreed upon by the Committee. For the information of honourable senators, the interim arrangement means that, for next week, the Senate will be broadcast on Monday and Wednesday, and the House of Representatives on Tuesday and Thursday. Senator DURACK —Has the Attorney-General seen the report in today's Age which details the checks that that newspaper carried out before publication of the tapes and particularly the transcripts? Is he also aware that the Age had audio tests done on the tapes before it satisfied itself that the material was authentic? Does the Attorney-General stand by his view of Tuesday that the material is completely unauthenticated in the light of this detailed information . I ask, further, whether he still maintains that: . . . the role of the Age newspaper in this whole affair has not been a very proud one . . . Senator GARETH EVANS —I have seen nothing in the Age this morning which leads me to vary that initial judgment. Of course it is the case, as the Age says, that checks have been done on a number of things that are checkable in the written material, the summaries and the transcripts-such things as the location of telephone numbers and of particular people at places they are said to be at the time that the purported conversations were recorded. I think that even Senator Durack, however, would appreciate that the status of the material is not advanced one iota by virtue of checks of that kind. Anyone minded to fabricate the material in whole or in part would hardly be likely to put together a document which contained erroneous telephone numbers or easily checkable matters of the kind that were an issue in the Age report. I do not say that in any spirit of wanting to denigrate what the Age has done by way of doing such checks as it has, but it certainly cannot take the matter any further so far as the status of the written material is concerned, and certainly not as to the accuracy of the detailed matters contained within it. As to the authenticity of the electronic tapes, I continue to repeat what I have said previously, that is, that there are grounds for believing that there are problems about the authenticity of the material in question. I note what Mr Wran said yesterday in the New South Wales Parliament in that respect. The material on which he drew in that answer was, in fact, also available to me and I can confirm the accuracy of that. However, the Commonwealth has not as yet had reports from its own consultant audio engineers in this respect. Until it does we will not be in a position to make any final judgment to our own satisfaction as to the authenticity of the electronic material. Senator DURACK —Mr President, I ask a supplementary question. I asked the Attorney, and I repeat: In the light of the information that has now become available and, indeed, in the light of some of the things he said in answer to other questions this week, does he still maintain the view he expressed on Tuesday, that the material is completely unauthenticated? Senator GARETH EVANS —Yes. Senator ROBERTSON —My question is directed to the Minister for Social Security. It is in four parts. What was the trend in total unemployment benefit paid in February 1984 compared with January this year? How does this compare with the movement between January and February 1983? Does the Minister have information on trends in unemployment benefit paid in the various States and Territories? Do the unemployment figures tend to confirm other indicators which suggest that an economic recovery is under way in Australia? Senator Lewis —It is a waste of five minutes of Question Time. Senator GRIMES —Maybe Senator Lewis does not like the figures. The latest available figures on the number of unemployment beneficiaries are, in fact, most encouraging, although neither I nor anyone else in the Government says that they are indicative of sudden or increased recovery. But they are, in fact, very encouraging. I hope Senator Lewis likes them. As at 24 February, 667,000 persons were in receipt of unemployment benefit, compared with 674,000 on 27 January. This represents a reduction of 7,365 over the past month, or a decline of 1.1- odd per cent. If we look at what happened during the same period last year we find that the figures are even more encouraging. During the same period last year the number of beneficiaries actually increased by some 5 per cent or 31,000 . Senator Lewis —We are aware of that; that is why we are sitting over here. Senator GRIMES —Indeed. In the next month I think the number increased even further. I think that, as Senator Lewis has admitted, it is indicative that there is a great difference between this Government and the previous Government in the fact that we have had such a success in getting down the number of people on unemployment benefit. With respect to the States the decline is spread quite evenly, with all States genuinely experiencing a decline. The largest decline occurred, in fact, in South Australia, where there was a reduction of 1,828 or 2.8 per cent. As I have said, this trend is the opposite of the trend last year. It is consistent with the downward trend in these figures, particularly since last August or September . It also has the beneficial effect that, quite clearly, the numbers receiving the unemployment benefit this year will be considerably lower than the 680,000 average anticipated in the Budget last year. Hence the Budget expenditure in this area will be considerably reduced, increasing our capacity to provide benefits to other people who are in need. It is certainly indicative of the optimism in the economy generally. So, as I say, although one always takes figures such as these with caution, they are certainly very encouraging and they must be encouraging to the whole community. Senator REID —My question is directed to the Attorney-General. I refer him to the answer he gave to Senator Chaney in response to his first question on the Age tapes yesterday, when he corrected his answer of the previous day by referring to the aide memoire and said that he now felt it accurate to say that: The judge said he may have spoken to the solicitor about the appointment. As in his answer of Wednesday, he indicated that the judge not only referred to the possibility of such a conversation but also indicated the content of such a conversation. Is it not clear that such a conversation did, in fact, take place? Senator GARETH EVANS —I really believe that the Opposition has drained the last drop out of this matter concerning the judge. The truth of the matter is that what we have here are transcripts and summaries of what are, if they are authentic, private conversations illegally monitored which, even if they are authentic and accurately reported down to every last detail in them, in the view of the Director of Public Prosecutions on the basis of the statement of the law of the DPP designate and the Solicitor-General, which largely agree with each other, are not such as to establish or point to criminal misconduct and are not such as to be related in any way to the judical activity of the judge in his judicial role. As such, they are not something which could properly, under any circumstances on whatever assumptions or even ultimately proof of authenticity, amount to misbehaviour such as would justify the attention of this Parliament. Under those circumstances-- Senator Chipp —Does it compromise the judge in any way, or could it? Senator GARETH EVANS —Not in any way that could bear upon the performance of his judicial office, nor upon anything which could remotely be described as criminal -on the assumption, that is, that it is authentic and on the assumption, which is not accepted, that every element in that conversation, to the extent that it may have occurred, was accurately reported. What I am saying is that even on the worst possible case assumptions, even on the assumption of complete authenticity , which is denied and certainly not established, and even on the assumption of complete accuracy as to every point of detail in it, there is absolutely nothing that justifies the scrutiny or the attention of this Parliament. We have here an Opposition going around like a collection of half-starved political Micawbers waiting for something to turn up to rescue them from their present impossible dilemma of their incapacity to make any impact on this Government. There is nothing here except political adventurism combined with malice, and I do not propose to answer further questions of this kind. Senator ZAKHAROV —Has the Minister for Education and Youth Affairs noted the appointment of Hylda Rolfe to chair the Prices Surveillance Authority, as reported in yesterday's Age newspaper? Can the Minister inform the Senate of the number of women appointed by the present Government to the boards of statutory authorities and the positions to which they have been appointed in line with the Government's policy of redressing the imbalance of the sexes at senior levels of government and semi-government bodies? Senator RYAN —Of course, I am aware of the decision of the Government to appoint Ms Hylda Rolfe as chairperson of the Prices Surveillance Authority. I think that appointment will be welcomed throughout the community as a sign of the involvement of competent women in this new initiative of government which will be of so much importance in terms of the average woman's ability to manage the family budget, I suppose, because the Prices Surveillance Authority will be a key part of our anti-inflation strategy. The appointment of Hylda Rolfe is a very important appointment. Senator Zakharov asked for details of the names of women who have been appointed by our Government to boards and statutory authorities in line with our policy of redressing the previous imbalance of women at senior levels of government and semi-government authorities. Because there has been to date such a large number of such appointments-in fact there were 62 as at the end of January and there have been several since then-I seek leave to have the list incorporated in Hansard. Leave granted. The list read as follows- WOMEN APPOINTED TO STATUTORY AUTHORITIES-MARCH 1983-JANUARY 1984 Authority Position Name Aboriginal Development Commission Deputy Chairman Shirley McPherson A.C.T. Schools' Authority Member Audrey Duke A.C.T. Schools' Authority Member Meredith Edwards A.C.T. Schools' Authority Member Clare Hughes A.C.T. Schools' Authority Member Joan Kellett A.C.T. Schools Commission C. O'Connor Administrative Appeals Tribunal Non-Presidential Member Mary McLelland (re-appointed) Administrative Appeals Tribunal Non-Presidential Member Helen Pavlin Administrative Appeals Tribunal Non-Presidential Member Joan McClintock Administrative Appeals Tribunal Non-Presidential Member Joyce Billings Advanced Education Council Member Rhonda Galbally Advanced Education Council Member Maureen Bickley Advisory Council for Inter-government Relations Member Jeanette McHugh, M.P. Advisory Council for Inter-government Relations Member Meredith Crome Advisory Council for Inter-government Relations Member Prudence Myer Advisory Council for Inter-government Relations Member Joy Oakley Aussat Pty Ltd Director Helen Hughes Australia-China Council Member Caroline Launitz-Schorer Australia Council Member Betty Churcher Australia-Japan Foundation Member Cynthia Menadue Australian Broadcasting Corporation Deputy Chairman Wendy McCarthy Australian Broadcasting Corporation Director Jan Marsh Australian Broadcasting Corporation Director Patricia Brady Australian Broadcasting Tribunal Member Julie James-Bailey Australian Film Commission Commissioner Gil Appleton Australian Institute of Aboriginal Studies Council Kate George (student) Australian Institute of Multicultural Affairs Member Betty Con Australian Institute of Multicultural Affairs Member Helen Cattalini Australian National University Council Member Georgina Carnegie Australian Telecommunications Commission Commissioner Margaret Jackson Australian Tourist Commission Commissioner Elfie Graham Australian War Memorial Council Member Elaine Darling, MP Canberra College of Advanced Education Member Helen Williams Canberra Commercial Development Authority Member Karen O'Cleary Commonwealth Accommodation and Catering Services (Ltd) Director Kathleen Bourke Economic Planning Advisory Council Member Jan Marsh Economic Planning Advisory Council Member Llois Cutts Family Law Council M. A. Edwards Family Law Council R. Wighton Film Censorship Board Member Mary Rose Liverani (re-appointment) Housing Loans Insurance Corporation Judith Yates Institute of Family Studies Professor L. Joyce Institute of Family Studies C. P. Petre Institute of Family Studies M. M. Finn Museum of Australia Council Member Lyndall Ryan Museum of Australia Council Member Mary-Anne Bin Sallick Museum of Australia Council Member Carol Serventy Interim Commission for Australian Sports Commissioner Elizabeth Darlinson National Australia Day Committee Member Ella Stack National Australia Day Committee Member Roma Burns National Australia Day Committee T. Young Schools Commission Member Denise Desmarchelier Schools Commission Member Joan Brown (re-appointment) Schools Commission Member Lindsay Conners Special Broadcasting Service Member Grada De Lacy (re-appointment) Technical and Further Education Council Member Denise Bradley Tertiary Education Commission Commissioner Andrea Hull Tertiary Education Commission Commissioner Pat O'Shane Trade Practices Tribunal Non-Presidential Member Maureen Brunt (re-appointment) Qantas Airways Ltd Director Mary Beasley Universities Council Member Hillary McPhee Universities Council Member Di Yerbury Senator RYAN —I will make sure that the list is updated regularly as the Government continues to implement this very important policy. Senator MACKLIN —My question is addressed to the Minister for Education and Youth Affairs. I refer to the decision of the Government to grant $5,000 to the organising committee of the Fifth International Congress on Mathematical Education which I understand the Minister has been invited to open. Is it not an insult to the mathematics community and to the Congress sponsors and organisers that such an amount has been offered? Does it not effectively deny any validity to the well-publicised recent statements of the Prime Minister during his overseas visit and to the statements by other Ministers in Australia concerning the importance of education in maintaining the viability of the Australian economy in the immediate future during a time of forced technological change? Is it not also the case that $5,000 is approximately half what the Federal Government may expect to recover from airport departure taxes payable by overseas visitors to the Congress and is equal to the amount recently announced by the Minister for Sport, Recreation and Tourism in support of baton swirling in Australia? Senator RYAN —It is the case, as I recall, that the Government has agreed to support this international mathematics competition with a grant of $5,000. I do not have a brief before me and, as we make a number of decisions to assist conferences of this kind, I cannot confirm that the sum is $5,000. Senator Macklin seems to have interested himself in this matter in some detail, so I presume that that figure is right. As to that being an insult, I really think this is a rather gratuitous piece of grandstanding by Senator Macklin. He must be aware that the Commonwealth Government has numerous calls on its revenues to assist conferences of a worthy kind within the education portfolio. As Senator Macklin would be aware, literally hundreds of conferences must be held every year, some with national and some with international components, virtually all of which, I would think, make a contribution to the educational standards of Australians and, therefore, to our capacity to contribute to economic recovery. For Senator Macklin to single out this particular grant, and to claim in the rather colourful terms he used that it is inadequate, I think is uncalled for. As Senator Macklin would be aware, we are dealing with an economic situation which we inherited and which is enormously difficult. The capacity for our Government in its first year in office to make very generous grants to all sorts of good causes just was not there. We have had to allocate priorities very carefully so that worthy causes get some assistance. Obviously we, like Senator Macklin, would like to see greater assistance, but greater assistance to such events can be forthcoming only when the economy is in a stronger state and when revenues available to us are greater. I remind Senator Macklin that, as well as assisting this conference, we are assisting the development of mathematics teaching and learning in a number of ways, including our assistance in tertiary education, special projects within the Schools Commission and a number of research grants covering development of better mathematics teaching in our schools. The area of mathematics teaching is certainly of great concern to our Government because, generally speaking, mathematics has been badly taught in our schools in recent years. We are concerned about this and, in consultation with our advisers, the Schools Commission and the Tertiary Education Commission, we have a number of ways in which we will overcome it. I conclude by saying that in this matter, as in all matters of assisting education in this country, our record already outstrips that of our predecessors very handsomely. I think Senator Macklin must have some reason of his own for wishing to grandstand in this way at Question Time today. Senator MACKLIN —Mr President, I ask a supplementary question. I refer to the last part of my question, to which the Minister did not respond. Is it not the case that $5,000 is half what the Government would expect to get from the departure tax? Secondly, is it not equal to the amount that the Government has given to baton swirling? Senator RYAN —I will have to refer those two specific questions to the Ministers responsible and get further information for Senator Macklin. Senator HEARN —I address my question to the Minister representing the Minister for Communications. Great concern has been expressed in Tasmania about the Telecom plan to centralise the 000 emergency service into the Hobart exchange. Following a recent total breakdown of Telecom services in the Ulverstone area due to fire and the subsequent disorder, what assurances can the Minister give to Telecom users that a similar occurrence in the Hobart area would not cause State-wide chaos and put a considerably large number of people at risk. Senator BUTTON —Senator Hearn was kind enough to give me notice of this question, which requires a detailed answer. I have obtained an answer from the Minister for Communications. First of all, in summary, the fears expressed in Senator Hearn's question would, on the advice given to the Government, not be realised in the circumstances which she suggests. Senator Walters —What about the jam? Senator BUTTON —You will get caught in the jam if you have sticky-- The PRESIDENT —Order! The Leader of the Opposition will address his answer to the question that has been asked. Senator BUTTON —There are three centres in Tasmania-Hobart, Launceston and Burnie. Telecom has no intention at this stage of concentrating that 000 service in Hobart on a full time basis. Currently, only Hobart provides a 24-hour service and all calls are switched to that centre between the hours of 11 p.m. and 7 a.m. this practice has been in operation for some time and no difficulties have been encountered to date. Nonetheless, over the years telephone subscribers in Tasmania have been encouraged to call direct their local fire, police or ambulance services rather than the 000 service. I am advised that in the unlikely event of any breakdown in the Hobart area interrupting the emergency service during the hours between 11 p.m. and 7 a.m., all customers other than those directly affected by the breakdown-that is, in the immediate region of the exchange-would have access to these emergency services through the other routes. Senator ARCHER —I ask a question of the Attorney-General. In his statement to Parliament on the Age tapes, he indicated that the conversations between the judge and the solicitor were recorded on both tapes and transcripts. How many conversations purportedly involving the judge are contained on the tape recordings? How many telephone conversations or alleged telephone conversations involving the judge are recorded in the transcripts? Senator GARETH EVANS —I am not sure that I can recall off-hand but my recollection is that one alleged conversation only is on the tape and perhaps another 10, or something of that order of magnitude, transcripts, purported transcripts or summaries of transcripts are in the written material, none of which is coextensive. I had better explain that word for Senator Archer. Senator Archer —Oh yes; please do. Senator GARETH EVANS —None of the material on the tape is in the transcripts and vice versa. Senator COOK —My question is directed to the Minister for Resources and Energy. I refer the Minister to his comments in the Senate last year to the effect that he was planning to inspect a number of solar and wind technologies on his overseas visit. Will the Minister advise the Senate whether he has drawn any conclusions from his inspections? If so, what are they? Senator WALSH —The conclusion that I have drawn from the information given overseas is that, with isolated exceptions-one of which I shall detail later-and with present technology, the cost of either wind power or solar power is vastly in excess of that of the alternative supplies which are available for the overwhelming majority of Australia, that is, any part of Australia which has access to cheap coal. For example, in Denmark wind generated power is estimated to cost 4c per kilowatt hour. That is at the point of production, not the point of delivery. Sydkraft, in Sweden, manufacturers of wind generating machines, estimate a cost of between 3c and 4c per kilowatt hour with the improved machine that it intends to produce shortly. The cost with the existing machine is higher than that. The wind speeds at those locations are close to the best known average wind speeds at an Australian site. Solar electricity is very much more expensive. Again, these figures come from the manufacturers of the equipment, so one would be surprised, to say the least, if the figures erred on the low side. The estimated cost of generating electricity at the McDonnell-Douglas thermal solar power plant at Bairstow, a 10 -megawatt power plant, is between 25c and 30c per kilowatt hour. The Arco photovoltaic plant, also in southern California, has an estimated cost of 60c per kilowatt hour. So, while the wind generated electricity in raw costs is not within a factor of one, anyway, of the cost of coal generated electricity in most parts of Australia, the cost of solar power, be it thermal or photovoltaic, is higher than Australian generating costs by a factor of 10 or even 20. In both cases, of course, the supply of electricity is discontinuous-that is, electricity can be produced only when the wind is blowing, in the first instance, or when the sun is shining, in the second. The major exception to that general conclusion is that, pending the production of relevant technical data, it may be possible that where a limited amount of wind generated electricity could be economic in Australia is in north-western Tasmania, where it is known that wind velocities are about eight metres per second. There is a possibility that there may be some locations where it is higher than eight metres per second and where any power produced would be fed into what is basically a hydro grid which can be turned on and off very quickly. In other words, for those periods when the wind is not blowing, instant or virtually instant power can be produced from other sources. I also visited some impressive experimental work-I shall not go into any depth on this-which the Swedes are conducting at Stripa, an abandoned iron ore mine, experimental work relating to the ultimate disposal of highly active nuclear wastes. I shall not go into the details of that. Some of them are given in the report of the visit which has been prepared, and which I now table. Senator PETER BAUME —My question is directed to the Attorney-General and follows the question asked just now by Senator Archer. As the Attorney-General himself has had at least two conversations with the judge allegedly involved, will he say whether he is satisfied that the voice on the tapes is the voice of the judge referred to? Senator GARETH EVANS —I explained earlier today that I am not going to nurture and nourish further the exploratory adventures in which the Opposition is now engaging. Whatever the truth of the matter may ultimately prove to be-and we shall be a better position to judge that when we have had a report on the authenticity of the tape material-the fact of the matter, as I have constantly repeated, is that even if the material, both tape and transcript, is absolutely authentic, even if every single word recorded in those tapes and transcripts was actually said and is recorded accurately, nonetheless, at the end of the day, one would be left with the conclusions that I believe were quite properly produced by Mr Temby on his analysis of the law and supported as that was by the Solicitor-General's analysis of the law, which is that nothing in this material either established or pointed to any criminal misconduct on the part of the judge; nor did any of this material, if authentic, if accurately recorded, in any way relate to the judicial conduct of the judge. As such-and I repeat again what I have said earlier today and at numerous times previously-there is nothing in the material which could possible or justly give rise to consideration as to whether the judge may have been guilty of misbehaviour within the meaning of section 72 of the Constitution and as such, particularly given the manifest illegality and privacy invading character of this material, I do not propose to nourish further the Opposition's desire to make some sort of capital-it clearly knows not what-out of this matter. Senator PETER BAUME —Mr President, I ask a supplementary question. I understand what the Attorney-General has said in his answer, but I ask him again: Is there not a simple answer to the question that I have asked, as to whether he is satisfied that the voice on the tapes was that of the judge referred to? It is a perfectly simple question. Senator GARETH EVANS —I have my own views on the subject, but I do not propose to share them with Senator Baume. Senator ELSTOB —Does the Minister representing the Minister for Communications know when the Homestead and Community Broadcasting Satellite Services will become fully operational? How many of those people living in outback communities throughout the Commonwealth will benefit from the services? Will the people in each of those outback communities be able to view television and receive radio broadcasts from and within each of their own State's television and radio facilities? Senator BUTTON —If the satellite has better fortune than the recent Indonesian satellite, it will be up in September 1985 and will be operational in December 1985. It is said that 300,000 people will potentially benefit from the services provided by the satellite. In Western Australia and Queensland, I believe, everybody will be able to get benefit from the satellite in terms of television and radio services provided, in the case of Western Australia, essentially from Perth. In Victoria, New South Wales and Tasmania, services will be provided via the satellite, originating in Sydney. I understand that the radio and television services in the Northern Territory will be provided from Darwin. The up-link to the satellite will come through Darwin and will be able to provide services to much larger areas of the Northern Territory than are currently eligible for service. In South Australia, which is the honourable senator's home State, I understand arangements are being made to investigate the use of 12-watt transponder to ensure a local South Australian-originated television service to South Australia. On the other hand the position of radio in South Australia is not yet clear. Investigations are taking place as to how a State-originated radio service will be provided. There is no conclusion in this respect at present. If the satellite goes up successfully it will provide a much wider range of services. In addition to television and radio media services, it will provide services both in the capitals and the outback to business and other concerns which require data transmission and things of that kind. Senator LEWIS —I also ask the Attorney-General a question about the Age tapes. I point out to him that my question relates to the conversation which he had with the judge and not to what was on the tapes. Earlier the Attorney-General said that one of the tapes involved the judge. I ask: Has that tape been played to the judge in the Attorney's presence? If so, did the judge agree that it was his voice on the tape? Senator GARETH EVANS —No, the tape was not played to the judge in his presence but it was made available to him to make such use of or take such tests of as he chose. Had he played it-indeed, had I played it-it may well be that he would not have been able to tell whether it was his own voice or that of Max Gillies or Mike Carlton. Senator LEWIS —Mr President, I ask a supplementary question. When was the tape played to the judge in relation to the conversations which the Attorney had with the judge. In those conversations which the Attorney had with the judge, did the judge concede that he thought it was his voice on the tape? Senator GARETH EVANS —Senator Lewis seems to be something of a slow learner, since I made it clear that I did not play the tapes in the judge's presence. Senator Lewis —No, but you had a conversation with him. Senator GARETH EVANS —I had a conversation with him. The question simply did not arise as to whether the judge had any view as to whether the voice he was hearing-his own or someone else's-was his own. It is not a matter that I pursued with him and it is not a matter that I propose to pursue with the honourable senator now. Senator CROWLEY —Has the Minister representing the Minister for Employment and Industrial Relations seen the report in today's Australian Financial Review headed 'Australia has third worst work safety record says NSC'? It reports that according to recent assessments by the National Safety Council in New South Wales alone, 300 people die each year through industrial accidents and diseases and each year there are 145,000 accidents from which workers are incapacitated for more than three days. Will the Minister comment on these figures compared to the claims for the same figures being the Australia-wide figures for last year? Will the Minister agree that these figures are quite appalling and that any reduction in the number of industrial deaths and accidents would contribute to a considerable reduction in on-costs to industry and to increased productivity, apart from the great saving to human pain and misery? Will the Minister comment on the need for rapid implementation of the Government's occupational health and safety program and adequate industrial data collection? Senator BUTTON —I have not seen the report in this morning's Australian Financial Review. Senator Crowley might be surprised to know that in those circumstances I have not discussed it with the Minister. On my recollection of the figures provided by Senator Crowley and which are apparently published in the Financial Review, they are consistent with the figures which were published last year and with the figures which have been published in Australia over many years in relation to industrial health and safety matters. I think those figures have been seen by all honourable senators from time to time, even in the worst years of industrial disputation in Australia. I am making the point that the time lost in Australia through industrial accidents has always been enormously high compared with time lost through industrial disputation and a variety of other matters. It is a problem which has not ever been addressed adequately by governments. In that historical context, it is sad that the present Government is now giving major attention to these problems at a time when the nature of industrial activity is changing significantly both in terms of equipment used and so on and in terms of the technological upmarketing of industry which makes accidents and disease of this kind probably less likely. All I am saying is that we are tackling the problem and it is sad that it has happened late in the day. Nonetheless, it is a problem which has to be tackled. The honorable senator and other honourable senators will be aware of the Government's proposals in respect of the national commission and the priority which the Government is giving to this question. It is difficult to estimate whether it means a reduction in on-costs to industry. I am sure it does. When I say that it is difficult to estimate, I mean that it is difficult to quantify what it means in terms of the reduction of on-wage costs to industry. It is difficult to quantify because it is not only a question of the time lost by employees but also a question of the relationship between the time lost and the compensation which is provided to individual employees in respect of accidents in which they are involved. The Government has for some time had under review the question of rationalising compensation for accident and injury. Whether we can reach a satisfactory solution to that question in co-operation with the State governments remains to be seen. Of course, compensation for industry is enormously costly as an on-cost. The two things are very much related. That is all I can say in answer to the honourable senator's question. I will refer the question to the Minister for Employment and Industrial Relations to see whether he has anything further to add to the answer I have given. Senator CHANEY —Does the Attorney-General agree that the Parliament has responsibilities in regard to the conduct of members of the judiciary? Will he arrange for the relevant Age tapes and transcripts to be tabled in the Senate in a form which would protect the identity of the individuals concerned to enable the Senate to make its own judgment about these matters? Senator GARETH EVANS —Parliament's responsibilities in relation to the conduct of the judiciary begin and end with Parliament's role in relation to section 72 (ii ) of the Constitution. There are excellent reasons for that, given the principle of the separation of powers which, particularly in a federation such as our own, as we are constantly being reminded by honourable senators on the other side, it is crucial to maintain. The Opposition, motivated as it undoubtedly is at the moment by the kind of political adventurism I described before rather than anything which could be dignified as public spiritedness, is not advancing any legitimate cause but is simply trying to make something out of an issue which does not justify that kind of attention. I repeat, as I have done twice already today, because it does not seem to have sunk in: Even on the worst case assumptions in the sense of fully accepting the authenticity of the material, both electronic and written, and even on the most complete acceptance of the accuracy of every last detail as transcribed and recorded in the Age and as might be read were this material to be tabled, the conclusion of two very distinguished Australian lawyers is that that is the relevant law. Those two Australians are the Director of Public Prosecutions designate and current President of the Law Council of Australia, who is respected by his peers and his inferiors all around the country, and the Solicitor-General, a man who was briefed regularly on all sorts of important cases by the Opposition when it was in government and whose integrity, independence and legal ability is unquestioned. Mr Temby, who is highly experienced in applying the law to particular facts, has reached the conclusion that there is no conceivable foundation upon which this Parliament, or anybody applying the proper standards of misbehaviour which are referred to in section 72 of the Constitution, could come to the view either that there was anything here bearing upon or relating to this man's role in his judicial office or in any way establishing or pointing to criminal misconduct. Under those circumstances there is no question, as I have repeated twice already , of nurturing further the exploratory urges of this bereft Opposition. Senator CHANEY —I ask a supplementary question. I note the Attorney-General's answer which is that our only responsibilities relate to section 72 of the Constitution. I remind the Attorney that, in his statement on Tuesday, he referred to his own intervention about the High Court of Australia in a very lengthy address which he gave in this place. I ask him: Was his attack on the High Court at that time related to his responsibilities under section 72, or was it related to his broader responsibilities as a member of this Senate to watch the public interest? Senator GARETH EVANS —I am very happy that Senator Chaney asked me that supplementary question because it is the case that that speech, which related to Sir Garfield Barwick, the affairs of his private company and the possible conflicts of interest in which he was involved, was very squarely directed to the judge's performance of his judicial office. What was squarely in issue in the Mundroola affair and in the matters that I drew to the attention of the Parliament were the potential conflicts of interest which arose from the fact that the Chief Justice, against all convention, had continued to maintain, over a long period, an active directorial role in a private land and investment company, which company in turn had shares in CSR Ltd, Brambles Security Group Ltd and Ampol Ltd, three major Australian companies which had been the subject of litigation on several occasions before that judge in the High Court, without that judge not only not disqualifying himself but also not even disclosing to the parties that he had that financial interest or indirect business interest. That was absolutely squarely related to the proper performance of judicial function. Had there been anything in this material which raised similar questions of bias or conflict of interest, had there been anything which in the view of Mr Temby had possibly given rise to that, then there would be no question but that that matter would have to be conceded by me to be squarely relevant to a potential application of section 72. I assure the Senate-I stand by this-that there is nothing in that material which justifies any such description. I do not propose to trail before the salacious eyes and ears of the Opposition and indeed the Australian public, as nurtured by an equally salacious Press in this instance, material which, at the most extreme assumptions about its authenticity and the most extreme assumptions about its accuracy, neither of which assumptions is accepted, is material which could give rise to an action of that kind. I hope I have made myself clear. Senator COLSTON —Has the attention of the Minister representing the Treasurer been drawn to a complaint made by the Premier of Queensland in the Queensland Parliament this week that he and his spouse have to pay a 1 per cent Medicare levy? Will the Bjelke-Petersen household be paying a 1 per cent levy on their parliamentary salaries or, because of the levy's $700 a year ceiling for families, will their total levy payment be about one half of one per cent? Senator WALSH —According to the Australian Associated Press transcript that I have before me, the Premier actually said that the Bjelke-Petersen Family or, rather, Mr Bjelke-Petersen and Senator Bjelke-Petersen, will be paying one per cent of their salary in the Medicare levy. Their total salary is above $122,000. So the answer is: No, they would not pay one per cent of their combined salary in the Medicare levy. They could not pay more than 0.57 per cent of their total salary in the Medicare levy. In context the claim by the Premier was wrong. It is of course possible that 'salary' and 'taxable income' are not the same because the Medicare levy is struck on taxable income and not on salary. Although for most people that are roughly equivalent it is possible that the Bjelke-Petersen's could be paying 1 per cent of their taxable income in a Medicare levy. For that to be the case, however, some $52,000 of the salary would have to be in some way removed from the taxable income base. I do not know whether Mr Bjelke-Petersen would care to correct the error he made when he asserted that one per cent of the combined salary would be paid in the Medicare levy because that cannot be done. It is possible that one per cent of the combined taxable income is paid as a Medicare levy. If that is the case he might care to explain to everybody else how $52,000 of combined salary was somehow got out of the taxable income base. Senator HAMER —My question is addressed to the Minister representing the Minister for Defence. In view of recent statements, including answers to questions yesterday by the Minister for Defence concerning dry docking of allied warships in Australia, statements which have caused understandable confusion and alarm to our allies, I ask the Minister: If HMS Invincible arrived in Australia again in precisely the condition she was in last December and a dry dock was available, would she be permitted to be dry docked without being required to de- ammunition? Senator GARETH EVANS —Mr President, I think on balance I would rather answer questions about tapes. I can understand, appreciate and indeed accept Senator Hamer's interest in this matter. It is the case that guidelines had not been formulated last year, as I described to the Senate, to deal with the particular situation of dry docking of ships which may or may not contain non-conventional weapons. It has been the subject of a sustained review since that time, involving consultations with our respective allies, the end result of which was to produce the conclusion which is set out in the Press statement of the Minister for Defence dated 26 February, to which I am really unable to add. What the Minister for Defence said was simply this: . . . consultations between Australian, United States and British officials over recent weeks addressed the question of an allied or friendly warship possibly needing to dry dock in an Australian port in the future. It was agreed that each request would have to be considered on its own merits taking into account technical and safety factors, and the strategic and operational circumstances obtaining at the time. The statement goes on to place particular emphasis on the question of safety considerations which obviously must remain paramount so far as Australian interests are concerned. So it is a question. It appears also to be one that is being accepted by our respective allies of simply looking at the situation in the circumstances of each time it arises. I do not propose, notwithstanding that Senator Hamer is dragging himself to his feet, to answer any hypothetical question as to what the situation would now be were the Invincible to arrive in dry dock dangling its propellor in exactly the same way as it did at the end of last year. That is a circumstance that would have to be addressed by reference to these considerations at the appropriate time. Senator JONES —Has the attention of the Minister for Resources and Energy been drawn to a claim made in a telex that was issued yesterday containing allegations that the Federal Government was raising a smoke screen for an unknown reason over its part funding of the Burdekin Dam scheme in North Queensland? These allegations were made by the State Minister for Water Resources and Maritime Services, John Goleby. Further, a dispute has broken out over the State Government's proposal concerning the break-up of a large land holding and the buy back scheme it proposes for those land holders. I ask the Minister: Has the Federal Government attempted to develop a smoke screen in relation to funding in that area? What dispute has broken out in relation to the buy back scheme proposed by the State Government in the State of Queensland? Senator WALSH —Yes, I have a photocopy of an AAP news release or report. Yes, the situation has been misrepresented by the Queensland Government. I might add, it is not the first time this has happened. Two things ought to be noted. The funding of the dam was guaranteed, and legally guaranteed, by the present Government after it came to office. The previous Government had not entered into a legal commitment to continue funding the construction of the dam. So there is no question about funding the construction of the dam. However, it had always been intended that the associated works downstream from the dam would be the financial responsibility of the State Government, for which the State Government from time to time would be making application for special borrowing entitlements . The borrowing entitlement sought by the State for the current financial year was approved by the Treasurer some time last year-I do not remember precisely when-and the Premier was notified, I believe in December but if not in December in January, by the Prime Minister that there were matters relating to further Loan Council approvals for special borrowings in 1984-85 and thereafter which we wished to discuss with the Queensland Government. There were two major points. The first was the compensation which was to be paid to the existing occupiers of the land which is potentially irrigable. It is clear from the information supplied by the Queensland Government that those compensation payments are related not to the value of the land in present use, that is, as dry grazing land, but to its value after it has been irrigated. The difference between its present value as dry grazing land and the compensation payments forecast by the Queensland Government is that the latter is about twice as high as the former. The second point was that all the larger landholders, defined as those with present holdings in excess of 100 hectares, will receive a 100 hectare irrigated retention block without paying the capital charge of $180,000 for the irrigation infrastructure which all the new entrants into the irrigation area will have to pay. In other words, I am advised that a number of large landholders, some 60 in all, presently owning more than 100 hectares and anything up to 3,000 hectares, will be paid well above market value-roughly double the market value as dry grazing land-for the land which is to be resumed and in addition will receive 100 hectares of irrigated land as a retention block without paying the $180,000 capital charge which all other new entrants will have to pay. We see those conditions as being inequitable. They doubly disadvantage the potential new entrants to the irrigated farming area, firstly, because the new entrants will not receive the very generous compensation and, secondly, because the new entrants will have to pay for a 100 hectare block the $180,000 irrigation infrastructure capital charge which the existing large landholders will not have to pay. In other words, the economic viability of the new settlers will be seriously jeopardised because they will have to pay $180,000 that their competitors, already having been treated generously by the Queensland Government , will not have to pay. Mr Goleby in this report states, and states correctly, that the waiving of the capital charge on the retention block for existing landholders is required by existing Queensland legislation. That is correct. But Queensland legislation can from time to time be changed. Indeed, I think I recall one or two instances when the Queensland Government actually wanted to change legislation and did it in about 15 minutes. Senator Chaney —Mr President, I raise a point of order. The Minister's answer has been long and fact laden, but it is very discursive and I believe is getting away from the point of the question. I ask you to bring the Minister to order. The PRESIDENT —The Minister has been relevant to date. I ask him to keep his answer to the point because Question Time is just about to a conclusion. Senator WALSH —Thank you, Mr President. My answer is to the point because the question refers to this statement from the Queensland Minister which contains a reference to the Queensland Act. Insofar as I have commented on it his statement is correct; however, the Act could be changed-if the Queensland Government had the will to do so. But it is quite apparent that the Queensland Government, at this stage at least, does not have the will to change the Act. It is equally apparent that the Queensland Government is happy to jeopardise the economic viability of the new settlers into this proposed irrigation area by imposing a $ 180,000 capital charge which the existing landholders will not have to pay. It is the view of this Government that it would be more equitable and would make more economic sense if the costs and benefits were distributed more evenly. Senator CHANEY —Has the Attorney-General had any conversations with the judge referred to in the Age tapes since the conversation of the 24th, that is, the second conversation he has already told us about? If he has had any further conversation or conversations with him, for what reason? Senator GARETH EVANS —There was one conversation lasting about two minutes the day before the statement was made, in which the judge asked me what material, if any, I proposed to table at the time of making the statement, and I told him. Senator FOREMAN —Has the attention of the Minister representing the Treasurer been drawn to an article in the Adelaide News on 29 February in which Senator Messner accused the Hawke Labor Government of taxing families an extra $17 a week? Will the Minister inform the Senate of the true situation in relation to changes in the level of taxation since March 1983 and how the record of this Government, especially in the area of family welfare, compares with that of the previous Government of which Senator Messner was a member? Senator WALSH —I am afraid that I have not seen that item in the Adelaide News, nor do I have any information about it. I am not even certain that I heard the question correctly, but I think it stated that Senator Messner had alleged that families were being taxed at an extra $17 a week by the present Government. Off the top of my head I could not comment on the accuracy of that. I must say though that, given its source-both the publisher and the alleged originator of the statement-I would be surprised if it were accurate. Senator Peter Baume —Mr President, I raise a point of order. Senator Walsh has just said that if a statement originated from Senator Messner he would have some doubt as to its accuracy. I believe that under standing order 418 that is a reflection upon the honourable senator and should be withdrawn. The PRESIDENT —It is a statement that is attributing improper motives to an honourable senator. I suggest that the Minister withdraw. Senator WALSH —If it is taken that way, Mr President, I will withdraw it. Since Senator Baume is interested in this matter, I also gave an opinion about the reliability of the Adelaide News as a source of information. Apparently Senator Baume, since he did not raise that, has no objection to my assessment of the Adelaide News. Two comments could be made: Firstly, the present Government inherited from its predecessors a desperate financial situation, a chaotic financial situation, and a prospective deficit of $9.5 billion. Because of that, and because the facts of that chaotic financial situation had been deliberately concealed from the Australian Labor Party and from the public by the discredited former Treasurer, it was not possible to proceed with the tax cuts which the Labor Party had envisaged making on coming to government; therefore the tax schedule which had applied in the previous year was substantially maintained for the present financial year. Of course there have been other significant benefits because of the election of this Government, particularly to people paying off housing loans. There has been a substantial decline in interest rates, which for people holding a loan of $30, 000 or more would substantially offset the $17 a week figure which Senator Messner has alleged. I have no idea of the basis upon which Senator Messner calculated that claim. But if Senator Foreman cares to supply me with a copy of the Adelaide News-I think he gave me that date, 29 February, a couple of days ago-I will see whether the Treasurer has any comment to make about the allegations as reported. Senator MacGIBBON —I ask the Leader of the Government in the Senate whether he saw an article in the estimable journal the Queensland Sunday Mail of 12 February 1984 dealing with the Richmond by-election. The article talks about the Australian Labor Party candidate, a Mr Carmont, and states: . . . but their dual offices in the Tweed and Lismore are working smoothly and with the aid of a Federal Government press officer, Mr Shane O'Connor, who is running the media campaign. This is a prima facie case of public funds being used for blatant party political purposes, namely, the conduct of an election campaign. I ask: To what Minister's staff is Mr O'Connor attached? If he is part of that notorious propaganda unit operating under the Orwellan title of the National Media Liaison Unit, whose budget was increased by the Labor Party in the last Budget by well over 100 per cent to fulfil its Goebbels-type functions? Is this what Australia can expect under the new Labor public funding of elections laws-a denial of funds to its opponents so they cannot get out their message, coupled with a plundering of the public purse to put out Labor propaganda? Senator BUTTON —I am not in the habit of reading the paper to which Senator MacGibbon referred, even on 12 February. I have not read the article in question . I do not know Mr O'Connor. The PRESIDENT —I have been informed by the Principal Parliamentary Reporter that , as a result of an industrial dispute in the Government Printing Office, the availability of the daily Hansard for today and for the early part of next week is likely to be delayed. The PRESIDENT —I have received a letter from Senator Chaney proposing that the following matter of public importance be submitted to the Senate for discussion, namely: The continuing uncertainty being created by the Government's proposal to introduce a resources rent tax. I call upon those senators who approve of the proposed discussion to rise in their places. More than the number of senators required by the Standing Orders having risen in their places- Senator CHANEY(Western Australia-Leader of the Opposition)(3.03) —I suppose that this matter of public importance could more accurately have been worded by referring to the discredited former resource rent tax proposals of the Minister for Resources and Energy (Senator Walsh) because it is quite clear that the proposal he originally put forward has been severely deserted by the Government of which he is a member. He is left holding but one remnant of the garment that he held out to us in such attractive economic terms. The Opposition is concerned about the fact that the Government in this matter is giving rise to very great uncertainty. That is causing concern to an industry which is of great importance to Australia and an industry which affects the long term stability of our fuel supplies and our independence from that point of view. I do not know what aspect of the matter Senator Walsh will choose to address. But I hope that he will not try to argue that there has not been continuing uncertainty about the matter that he has in hand-the imposition of a resource rent tax. Not very long ago he told Australia and the Parliament that he would impose a resource rent tax on coal and oil and that that tax would apply throughout the country and, of course, it would apply off-shore, where most of our oil resources are won. We now know that the Government has stepped back from the coal industry. Senator Walsh has indicated that he does not see that the Government could introduce the tax on-shore. He is now saying that he confidently expects a tax to be imposed from 1 July on off-shore oil and gas. But the certainty in all the public expressions which I have seen from the Minister does not seem to be shared by all of his colleagues. It certainly does not seem to be shared by the Premier of Western Australia. The other night, on one of the rare occasions when I was able to watch television, on the Australian Broadcasting Corporation news I saw Labor Premier Burke speaking to an audience of New York businessmen, obviously trying to say things that would please them. I quote from the transcript of Mr Burke's remarks: My quite frank view is that the tax is unlikely to be imposed as from July 1st. Although the announcement of its application has been made, I am sure that it is with much less joy that the National Government embraces the concept than it embraced it from the Opposition Benches. I sometimes wonder whether Senator Walsh, who has been handed this thorny task, looks at the present Treasurer, Mr Keating, and thinks of him as the now discredited shadow Minister for Minerals and Energy for having run so hard with the proposition which has proved so difficult, if not impossible, to implement. But Premier Burke, a Labor Premier who shares the views of Labor and non-Labor Premiers alike about this tax, namely that it is a tax which should not be imposed, was expressing, perhaps, no more than a pious hope. I hope that Senator Walsh will be able to enlighten the Senate a little more about just what are the Government's present intentions. I certainly do not expect him to give us the sort of specific information that he has been promising and which he has been unable to deliver so far, which would tell us just what effect this tax will have on the industry. I do not know whether Premier Burke was acting as an agent for the Hawke Government when he set out to ease the fears of his audience. But I must say that, from the looks on people's faces as they were shown on the television screen, they did not look too reassured. The same lack of reassurance is evident on the faces of the people who are responsible for the oil industry in Australia . There is dual uncertainty-uncertainty in the Government and uncertainty in the industry. I think there is still uncertainty in the Government about just what to do. I was very taken by a comment from someone who met Senator Walsh while he was overseas recently. He said: 'There is no doubt about Senator Walsh. He knows that he wants to do something, but I do not think he knows what it is'. I suspect, from the sort of information which Senator Walsh has been putting out, that that is a fairly accurate summary. He knows what he wants to do. He wants to put in a more rational tax, something which is profit based. He wants to put in something which will not deter investment. But he does not really know what to do. The attempts he has made to explain the matter-I welcome the fact that the Minister has put out some discussion papers and invited public comment-have still left very great areas of uncertainty. The fact is that the Government has backed and filled. Senator Walsh has backed and filled. The minerals to which the tax is to apply and the locations to which it is to apply have varied and that, of course, is of great concern to the Opposition and to Australia. The second area of uncertainty I mention is in the industry itself. I will refer to some of the recent statements which have been made by industry sources which make it very clear what is the attitude of the oil and gas industry to what the Government has been proposing. As recently as 3 February APEA-the Australian Petroleum Exploration Association Ltd-issued a detailed statement in which it put its view that the tax was one which should not be imposed. I quote in part from the Press article reporting that statement: The Federal Government's proposed resources rent tax was already seriously affecting investment in petroleum exploration and development, the Australian Petroleum Exploration Association Ltd said yesterday. The article continued: Offshore drilling is expected to fall from 49 exploration wells last year to 32 this, . . . more offshore wells had been expected to be drilled in 1984, so the logical conclusion to be drawn from the 1984 survey was that the Government's proposal to apply the tax offshore initially was already causing investment caution. Mr Orchison, on behalf of the Association, stated: 'Exploration programs are highly sensitive to changing circumstances such as the proposed resources rent tax-commitments to contractors at this stage are only 113 exploration wells'. I do not want to go into all the figures which APEA has given. I know Senator Walsh is likely to point to the fact that quite a substantial number of wells have been drilled over recent years. However, I think Senator Walsh would also agree that over this current year and last year there has been a very significant decline in the amount of seismic work done. That of course is the forerunner to drilling. It is quite clear that there is a downturn in that area and it is quite clear that the industry is expecting a further downturn in drilling. I have heard Senator Walsh in this place before saying that that is all very well but that that downturn is related to changing conditions in the oil industry world-wide. I do not wish to mask the fact that, since the world price of oil has stabilised and at times dropped in real terms and since demand has dropped and supply become readily available, of course interest in exploration has declined. That fact does not detract from the argument I am putting, rather it supplements and buttresses it. Of course it is in Australia's continuing national interest to maintain oil self-sufficiency. It does not matter what the immediate market conditions are. The fact is that Australia, with a current high degree of self-sufficiency, faces a significant decline in self-sufficiency. Australia faces the fact that this is not a particularly prospective area for oil exploration and that in the world there is always the risk of shortage because of the instability of many of the areas from which oil is taken. It must be in the national interest to maintain a high level of self-sufficiency. That means a high level of exploration. If there are external economic factors working against the search for oil in Australia it ill becomes the Government to take steps that will buttress and further that trend. The more Senator Walsh points to external conditions as augmenting the decline in interest in exploration the more he argues against the sorts of changes that he is proposing, which clearly present a disincentive to the people engaged in this industry. I quote again from the APEA statement in which Mr Orchison, on behalf of the organisation, is reported as saying that he: . . . believed the RRT was unsound and impractical. They feel there is little value in replacing the present tax arrangements for the petroleum exploration industry with a tax that is complex . . . The present arrangements have encouraged exploration, so there is no point in giving away a system that works for one that may not work . . . . . . . The shelving of the Government's RRT plans is essential to sustain exploration effort. I am sure Senator Walsh is familiar with many other statements of people in the industry. I will mention only one other statement, that of The Broken Hill Pty Co. Ltd, a major company with interests in this field. On a couple of occasions we have had spokesmen from that company pointing out that if there had been a resource rent tax when Jabiru was being considered BHP would have decided not to drill. The Minister is entitled to say that he takes with a grain of salt the views of these people and that after all Senator Chaney is citing the views of people who will be affected by this tax. That is correct of course. I think it is abundantly clear that the people in this industry who are required to make investment decisions believe that the incentive for exploration will be diminished by what Senator Walsh is proposing. I think that is the reality faced by Senator Walsh and the Government. I do not believe there is any escaping that reality. The problems of the tax have been perceived to be problems outside Australia. I have already mentioned that the Premier of Western Australia saw fit to deny the words of Senator Walsh and to suggest that in fact the tax would not be in place by 1 July. I draw the Minister's attention to the reference in Australian Business to the American mining magazine Engineering and Mining Journal which recently comprehensively reviewed the Australian mineral scene. It pointed out the anguish of the mining and exploration industries over resource tax initiatives by Canberra. I do not think there is any doubt that there is uncertainty. There has been continuing uncertainty in the mind of the Government and in the mind of the industry. It is the uncertainty in the minds of the people that make up this industry that is creating potential problems for Australia. I believe that the premier and very heavy responsibility that Senator Walsh carries is to maintain an environment conducive to encouraging oil self- sufficiency in Australia. I do not believe that it is an easy task. I believe that in a government where there will be a very heavy scramble for revenue to enable it to meet the sorts of reductions in personal income tax that are no doubt needed as a pre-election sweetener the pressures on Senator Walsh and his Department will be heavy indeed. I think if he takes his duties seriously and in the national interest-I am sure he does-he will agree that one of his premier responsibilities, if not his premier responsibility, is to maintain a high exploration effort, thus maintaining the highest possible oil self-sufficiency in this country. I have never accused the Minister of insincerity or of having a lack of a purely theoretical base for the propositions which he has advanced. I say that because I think he has tried to put the case in terms which are logical. He has talked of the need to lift non-profit related taxes because of their potentially deleterious effect. He has talked of imposing this new tax only above the ceiling which is required to bring about investment in this essential industry. I acknowledge that in that sense he has put forward arguments which take into account the sorts of concerns which I have expressed. I think it is now abundantly clear that there are very great problems with the theory he has put forward. Those problems arise both on a theoretical and a practical level. I believe the first problem that the Minister cannot overcome is that relating to the ceiling point. The point at which the tax begins to apply is a judgment. Senator Walsh has to try to find a figure which is the figure at which people will be prepared to put money into this very risky industry. I think if a very careful analysis were done of the actual workings of companies it would be possible to divine that figure at a particular time. I ask Senator Walsh to concede that that calculation is a calculation of a moment. It is a calculation based on circumstances on a particular day in a particular month and in a particular year. The ceiling which he is pursuing is in fact a moving target. The sort of stable tax regime which he is recommending cannot meet the theoretical model for multiple projects and at the same time maintain the sort of stability he has talked about. The second problem for Senator Walsh and the Government is that if they are going to go down the theoretical path outlined by Senator Walsh they have to base the cut-in point for the tax on the figure required to maintain investment rather than a particular revenue target. It seems quite clear from Senator Walsh 's recent statements that the Government has to tailor this tax with revenue targets in mind. Senator Walsh has begun to be quite explicit about that. Senator Walsh has said that we need to raise the same money out of old oil and that we need to raise additional money out of new oil, say an additional 10 per cent. Once he starts setting the threshold figures and the tax rates on the basis of some revenue target it seems to me that the theoretical attractiveness of this tax disappears because the threshold is being set not from the point of view of trying to make an inspired guess at the magic figure at which people will continue to invest but of making a rather more prosaic stab at the figure that will return 300, 400, 500, or whatever number, of hundreds of millions of dollars extra revenue is required. Another problem for the Minister is that the figure is simply not going to be static and that varying conditions will prevail. The oil price situation of course is something which is very variable. There will be variable returns with this sort of resources rent tax approach of Senator Walsh. Again it is not a matter that will be of very great practical assistance to his Government. Of course the major obstacle and the obstacle which has already caused the Government and Senator Walsh to withdraw from a great deal of this area-that is, to withdraw as far as coal and on-shore oil is concerned-is that the model which he has constructed ignores the realities of the Federal system. On this occasion Senator Walsh cannot rail against Premier Bjelke-Petersen and say that it is all his and Premier Gray's fault and ascribe to them the demonic qualities that he likes to ascribe to non-Labor politicians because he faces the fact that his Labor colleagues from the States have the same low opinion of what he is trying to do as do the non-Labor Premiers around Australia. We face the situation where the Government has made backdowns, where the Government has indicated that it will depart from the theoretical base that Senator Walsh outlined. The Government will have to pursue revenue targets and perhaps, most importantly, the economic logic that Senator Walsh sought to embrace will be totally absent from the fact that one will have one sort of tax regime on-shore and a different tax regime off-shore. That means, of course, that there will be a major distortion of the investment decisions which are made about oil exploration in Australia. I believe it is quite clear that it is not in the national interest for the Government to continue to pursue this mirage. I do not believe it is in the national interest, if the Government is to back down further, that that back down should be further postponed. I believe that the disquiet which is evident in the industry should be put to bed. If the honest reality is that this Government is determined to tax oil more, it ought to do so in a simpler manner which is more acceptable to the industry than to go through the hoops which Senator Walsh is at present trying to jump, to no good effect at all. In what is a very limited time of debate on a very important subject, I simply close by saying to the Senate that I believe it is the primary task of Senator Walsh, his Department and his Government's activities in this area, that they maintain an exploration effort which will best possibly ensure Australia's self- sufficiency in liquid fuels. The Government cannot escape that primary obligation; it cannot escape that primary duty. The course which is being followed by Senator Walsh at the moment is not in the national interest because it cuts across that fundamental objective. I ask the Government to withdraw this proposal and to deal with the matter in a more sensible way which will avoid some of the problems which are currently being created. Senator WALSH(Western Australia-Minister for Resources and Energy)(3.23) —I have agreed to limit my speech to 15 minutes so I probably will not have time to cover all the points that have been raised. Senator Chaney at the end of his speech and earlier seemed to be implying that the sole objective of an oil policy should be to maintain a level of exploration sufficient to maintain self- sufficiency. If that is his belief-if that was the belief of the previous Government-it begs this question. Why was there any tax at all, under the previous Government's policy, on new oil? Even on new oil the previous Government's policy imposed a 10 per cent ad valorem levy in certain circumstances, probably a 12 1/2 per cent ad valorem levy and company taxation. If the only objective which was worth pursuing was to maximise the exploration activity for new oil the previous Government should not have imposed any tax at all. I would welcome from subsequent speakers an explanation. What they would have to acknowledge, of course, ultimately is that it is a matter of judgment as to what tax regime is consistent with an optimum level of exploration activity and that is a matter of judgment. Senator Chaney has claimed that the Government has continually backed away from the proposal. He claimed, quite wrongly I believe, that I had said a tax would be applied on coal. I certainly do not remember ever saying that. If I did I would be obliged if Senator Chaney could refer me to it. What I have said on many occasions is that the two obvious candidates for the application of a rent tax are export quality coal and oil because they are two commodities in respect of which in many cases the economic rents are high. This is particularly so in the case of oil. I have always acknowledged that it was not feasible to introduce a rent tax on export quality coal unless the States co-operated. I have also acknowledged the possibility that they would not co-operate. Likewise I have always acknowledged the possibility that the States would not co-operate in the application of a rent tax on petroleum products on-shore where they have the primary taxing right. At least six months ago I publicly made statements to that effect. I said that if the States will not co-operate in respect of on- shore oil the Commonwealth, reluctantly, will be forced to proceed off-shore only. That will still achieve some 90 per cent of our objective because 90 per cent of petroleum products are produced off-shore. That is a ratio which is likely to be maintained. The reason why the Australian Labor Party, way back in 1977, initially adopted this policy-I am sure Senator Chaney is at least broadly aware of it-is that it is a superior tax. A rent tax, in terms of economic efficiency, is a superior tax to any other form of taxation. The major technical reason for that is that a properly structured rent tax imposes no tax on a marginal project and no tax on the marginal production or output of an above marginal project. It also improves the cash flow of a project in its early years as against any other alternative. Therefore it has been in the Labor Party platform since 1977. It was canvassed heavily by my predecessor the present Treasurer, Mr Keating. I will quote just a couple of the many statements Mr Keating made on the subject. On 25 March 1980 in a speech to the Australian Petroleum Exploration Association he said: It would be the intention of the Labor Party in office to scrap the existing levy system and replace it with a resource rent tax. This would mean that all existing Bass Strait production would receive a uniform price and be subject to a resource rent tax . . . In the same speech he said: A Labor Government would price new oil . . . at the full import parity price, but this oil would be subject to a resource rent tax. A resource rent tax therefore would operate on all Australian oil production, both old and new. On 29 April 1982, in the House of Representatives, Mr Keating stated: . . . the Opposition has supported a resources rent tax which is a much fairer, more equitable and more stable form of taxation which does not discriminate against marginal production or from the draining of reservoirs and which would, of course, be non-distortionary and produce the right kinds of production decisions which we will not see produced from the existing levy system. One point I would like to add in the limited time available to me is that the existing system imposes nothing more than corporate tax and the ad valorem levy on new oil and maximum rates as a primary tax, a levy, of up to 87 per cent on old oil. From those facts it is obvious that the distinction between new and old oil is a very important one and one which cannot in all circumstances be made with certainty. Indeed the possibility of new geological evidence emerging which could lead to informed geological opinion changing on whether a particular pool of oil should be classified as new or old is present. At the margin, even without new geological evidence coming forward, it becomes a matter of judgment rather than a matter of certainty. There are many other factors which could be mentioned but I do not have the time to do it. Since the election of the present Government, in addition to repeating the justifications for the tax which my predecessor had stated over many years, assurances were given in conformity with the general policy of this Government that there would be wide consultation with the industry and other interested parties. In 1977 the Fraser Government considered the application of a resources rent tax and publicly announced it. Mr Anthony went through his typical arm- twisting act and the Liberals displayed their usual dearth of political courage and caved in to the National Party of Australia as it has always done. The proposal was revived again, at least to some extent, in 1980 and the then Liberal Fraser Government backed off, I suppose for the same reason. The present position, so far as this Government is concerned, is that for this week and the next two weeks an intensive study is being conducted within the three departments which are involved to a considerable extent-or four departments if one counts the Australian Taxation Office as a separate department-the Taxation Office, the Department of the Treasury, the Department of Resources and Energy and the Attorney-General's Department, with a view to producing a paper with figures in it. In the past the absence of specific figures has been a criticism levelled at the Government by the industry although the Government, of course, was caught to some extent in a chicken and egg situation whereby it was not possible to put figures in the paper until other information had been supported by the industry. Following that three week period, or a little over two weeks from now, that paper will be taken to the States and to the industry for further discussion. Under existing Commonwealth legislation it will be necessary to reach an agreement with Victoria and Western Australia regarding present royalty sharing arrangements and compensation in the form of a percentage share of the rent tax or some other form of compensation to which they have a present legislative entitlement. I think that it ought to be noted for the record that in constitutional terms the payment of any amount to the States from off-shore areas is ex gratia, that is, the States have no constitutional entitlement to any payment from off-shore resources beyond the territorial sea. Under present legislative arrangements they do have an entitlement. Senator Chaney implied that the industry was monolithic in its opposition to the rent tax proposal. That is not correct. For example, on 23 February, Woodside Petroleum Ltd-I have been given authority by the company to quote this- commenting on the choice between a rent tax or some other form of tax said: However we also believe that if the choice is between the imposition of a profit based tax and a production based tax the former is to be preferred. Thus a soundly based RRT would be less damaging to the industry than an extension of the levy system which presently applies to 'old oil'. Production based taxes are arbitrary and ignore capacity to pay. Bridge Oil is reported in the Age on 24 November in similar terms. Perhaps most significant of all are the words of Mr Robert Holmes a Court published in the Business Review Weekly on this subject. In view of the time I will not read both quotations. The first states: . . . he-- that is, Mr Holmes a Court- speaks almost glowingly of Resources Minister Senator Peter Walsh's resource rent tax proposal. ''I think it's absolutely clear that a resources rent tax is a very sensible philosophy-a tax based on profits, provided they get the figures right and provided it (the profit) is properly determined.'' Mr Holmes a Court has spoken to me privately in similar terms. Indeed, he said that in principle no rational businessman could oppose this tax. He was, of course, correct, which helps to explain why other business managers in Australia less rational than Mr Holmes a Court sometimes feel threatened by him and perhaps are sometimes threatened by him in a managerial sense. So, the industry is not monolithic on this question. Indeed, there have been some recent-I do not know whether I should say 'reporting', 'rumour mongering' or whatever-approaches from at least one producer that discussions should be held about a levy on new oil rather than a rent tax. Such a proposition has been put forward. In response to that even APEA said in a discussion paper circulated, I think, to all members of the Federal Parliament a few days ago: However, APEA is strongly opposed to any additional tax on the petroleum production industry and its concern about the impact of the RT would also apply to other forms of tax including an excise on 'new' oil. In a statement put out at the same time APEA repeatedly made that reference. Just in case there was a view that while there was opposition to a rent tax a levy on new oil would be acceptable or at least preferred. APEA made it perfectly clear that at this time both were equally unacceptable. I should have mentioned that the proposal was discussed at the meeting of the Australian Minerals and Energy Council on 3 February. At that time the State Ministers present agreed when I put the question: 'Would any State Government under any circumstances contemplate or consider increasing the existing State royalties on on-shore production if extremely high producing high profit fields should be discovered? If any State Minister believes that any State Government would ever increase State royalties under those circumstances please say so.' Nobody said so. There was agreement by all the State Ministers that under no circumstances would they increase State royalties above their existing levels either in overt or covert form. I am perhaps a little more sceptical of that assurance now but I think that it ought to be put on record that it was given. There has been some considerable or at least very important confusion displayed recently by APEA regarding the current policy enforced upon us, of course, by the constitutional limitations of the federal system of applying the rent tax off-shore. APEA has drawn attention to two things. One is that the exploration offset would apply off-shore and not on-shore and the second is that there is a greater national need to explore off-shore than to explore on-shore because the probability of finding large pools of oil off-shore is considered to be greater, and that latter part is correct. But there seems to be a good deal of confusion in APEA'S present thinking in seemingly on the one hand saying that an exploration offset either by way of tax credit or subsidy payable only off-shore will direct, other things being equal, or will concentrate, other things being equal, exploration activity in off-shore areas, which is a reasonable conclusion . This is also what APEA says would be in the national interest, that is, for exploration activity to be concentrated more in off-shore areas. But APEA seems to reach the point of confusion of being opposed to the policy which, according to its own reasoning with other things being equal, would produce the desired result. I would like to cover many other matters but time does not permit me to do so. There will be-and almost certainly for the reasons Senator Chaney stated-some decline in exploration activity because of the low level of seismic activity in calendar year 1983 and the projected equally low levels of seismic activity in 1984. I stress, however, lest someone attempts to misrepresent this fact and say this is due to the election of the present Government and its policy, that the actual level of seismic activity in the 1983 calendar year was some 30 per cent higher than APEA had predicted at the end of January last year before the Federal election was called. I am not saying that seismic activity increased beyond the expectation because of the election of this Government but it is untrue and it would be completely dishonest to suggest that seismic activity decreased last year because of the election of the present Government. Nevertheless, there are various reasons why it fell. The decline in seismic activity has implications for the future levels of exploration activity. Probably it will fall in the short term, although it did not decline last year to the extent anticipated. APEA this year is forecasting a significant decline in the number of exploration wells drilled in off-shore areas. It is also forecasting a significant increase in the number of on-shore wells drilled. Again, that has nothing to do with the debate on this matter or the present Government's policy on it. Senator Sir JOHN CARRICK(New South Wales)(3.40) —Mr Deputy President, at the outset I ask that the Minister for Resources and Energy (Senator Walsh) table the document from which he read the Woodside Petroleum extract. Senator Walsh —No. I was given authority. I regard that as confidential correspondence. I was given authority to read the three sentences which I read but not the whole letter. Senator Sir JOHN CARRICK —Mr Deputy President, I take a point of order. There is a standing order which makes it clear that if a Minister chooses to quote from a document he knows full well that he is liable for the tabling of that document. Otherwise, it is impossible for us to know whether he was selective in his quotation. The DEPUTY PRESIDENT —The relevant standing order is standing order 363. If the Minister declares it confidential, which Senator Walsh has done, he is not obliged to table it. Senator Sir JOHN CARRICK —I invite the Senate to consider the possible selectivity of the quote. Senator Robertson —You invite the Senate to indicate that you are disagreeing with the Deputy President's ruling. Senator Sir JOHN CARRICK —On the contrary. The DEPUTY PRESIDENT —There is no disagreement with my ruling. Senator Sir John Carrick has the call. Senator Walsh —Mr Deputy President, have you ruled? The DEPUTY PRESIDENT —I have ruled on this matter. The Minister is not obliged to table it as he said it was confidential. Any further action is for the Senate . Senator Sir JOHN CARRICK —The Senate is debating the following matter of public importance: The continuing uncertainty being created by the Government's proposal to introduce a resources rent tax. There is very grave disquiet and uncertainty throughout the community, particularly in the oil industry but also in other resources industries, because of the Government's stated policy on a resources rent tax, because of the stated intention to withdraw, to rescind, the off-shore legislation which provides for sharing between the States and the Commonwealth and, of course, because of the constant repetition of statements by senior Ministers, notably Senator Button, on the possibility of a capital gains tax. Those matters, constantly repeated, create grave uncertainty. Senator Chaney has made it abundantly clear that for the time being there has been a retreat by the Government on the resources rent tax from coal to oil and then from on-shore oil to off-shore oil. But one can never be certain what this means. One can never be certain whether what the Government is doing for the time being will be making some other raid upon the oil industry in the guise of a resources rent tax or some other kind of levy. The fact is that the Minister, in his speech, was notably silent on the one key thing. He said that he inferred from Senator Chaney that the previous Government had regarded the sole test of its policies on taxing oil the goal of self-sufficiency. Quite clearly, one must regard the goal of self-sufficiency in oil as of paramount consideration for this country. Of course, if one is able to achieve that one also must ascertain how much of the resources one can take back for sharing by the public revenue. What the Minister did not say was that at the time that the last Labor Government was in power exploration in this country fell to the lowest it has been-something like 25 wells-and that under the Fraser Government's import parity policies, under its nurturing of exploration, it rose to record heights in 1982-83. He also did not say how fragile is this degree of self-sufficiency. To understand this one must understand that in 1977, when self-sufficiency was 67 per cent, it was generally agreed that, unless there were substantial exploration finds, self-sufficiency would decline to 50 per cent by 1985, to 40 per cent by 1990 and to 10 per cent or 20 per cent by the turn of the century. They were perilous figures. It is a great tribute to the Fraser Government's import parity policy and its nurturing of the industry that it was able to recast those figures more recently and to say that now it is likely that the 67 per cent self-sufficiency will rise in the next two or three years even to something like 77 per cent. One should not be complacent about that, because the prediction is that it will start failing then and will fall very severely from the early 1990s unless exploration is kept at a high point and major discoveries are made. It was extraordinary that a Minister, in debating this matter, did not present the scenario of the degree of self-sufficiency for the next decade or so. Indeed, he ignored the peril of the industry in this regard. The fact is that the industry is in a perilous situation. The Minister also ignored the fact that, whether or not one taxes new oil at import parity, there is a corporate tax which has a habit of taking 46 per cent of profits and distributing it in the community. So there is such an equity in existence. He also failed to stress that the companies themselves have been very keen and zealous in ploughing back the profits that they have made. From memory, in the last four years, during my own ministry and since, BHP-Esso has ploughed back some $1,200m of profits into exploration, thereby giving the community the prospect of greater self-sufficiency. None of this, of course, was said. He also did not say that the world today is on a knife edge because of the Iran-Iraq war , the dangers of the Strait of Hormuz being closed and the possibility of our having to fall back on our own resources. He also did not say that the International Energy Agency, of which Australia is a member, has predicted that, even if the Middle East is not in a military crisis, in five, six or seven years from now there is the prospect of an Organisation of Petroleum Exporting Countries oil crisis, with the demand for oil from the developing countries and the fact that we are using oil at about twice the rate at which we are finding it bringing about a crisis of rising prices. Against that background one needs to ask: Why would one disturb a most successful program? Why would one disturb a program that has taken us from grave danger-under the Whitlam Government's last year, 25 wells and all but one rig gone from Australia-to a great success story? One difficulty that the Minister has failed to mention is that in his dicussions with industry until now he has talked in general terms. It is only today that we have learnt that there is to be a paper with figures in it. The truth of the matter is that company after company has said to the Minister and to the Government that a resource rental tax would threaten their profitability and their ability to plough their earnings back into exploration and development in this country. It is no good being complacent. Jabiru looks as though it may be interesting, but it has not been proven as yet. In any case, if it is proven, we will need more Fortescues and more Jabirus. I see the Government looking for ways to get around the decision on Fortescue and looking for ways to grab more revenue. This is not just a question, as the Minister put it, of the resources rental tax in his view being a superior tax. In point of fact, in the discussions with industry so far the overwhelming majority of the industry has said that this tax, whatever its theoretical value, is a very dangerous and threatening tax if applied to the industry. What are we doing with respect to exploration in Australia at the moment? Australia is on a real knife edge as to whether it will go into recovery or go back into recession. Leader after leader in the industry, whether it be Sir Arvi Parbo or Sir James Foots, all indicate that there are dangers to this country. Indeed, Sir James Foots, in an article that I read from the Australian Director of December-January, indicates that he feels that there is real peril for Australia. He says: What is missing from the economic news so far, is an indication that new investment has begun to increase. Without some early sign that investment is beginning to pick up I am nervous about the fragility of the recovery. He goes on to say that it is foreshadowed that: There is likely to be renewed pressure on interest rates in the second half of 1983/84 . . . He indicates that it is likely that there will be upward pressures on inflation. So he, like other industry leaders, has painted the picture that if Australia is to emerge into recovery instead of back into recession, we must do nothing to disturb the fragility of that recovery, nothing to increase pressures upon industry, nothing to put up costs. The minerals industry in Australia, with the exception of oil, is in a perilous situation. The coal industry is having mines closed down. The prices for our contracts for iron ore and the volumes of iron ore are falling. All these things mean that the minerals industry and energy industry are prospectively likely to earn less and to employ fewer people in the immediate months and years ahead. This is the atmosphere in which a government talks about new taxes. Why does the Government not, for example, put people out of their misery on the question of a capital gains tax? Why does it let the Leader of the Government in the Senate (Senator Button) repeat his view that there ought to be a capital gains tax? The effect of these kinds of things upon industry is threatening. Why does the Government not say whether it will proceed with its attack on the present legislation on off-shore activities, the partnership between the Commonwealth and the States? Why does the present Minister for Resources and Energy remind us gratuitously today that the payments of royalties to the States on oil are ex gratia payments? Why does he do that? It is unnecessary, unless it is in his mind, perhaps, to upset those arrangements. I cannot understand why in this delicate situation anyone would want to put any new elements into the community. Indeed, what one should be saying is: 'Here we have had a most successful oil exploration and a most successful development.' Can anyone deny with figures that the companies concerned have ploughed back their profits in a very reasonable way, beyond reason in many cases, and developed exploration at an optimum level? Is there any suggestion that they are withholding profits and not developing enough, or that exploration and development are not being financed out of profits in this country? Surely all these things would have needed to have been exposed before one said: 'I shall disturb this situation.' Here was a going concern, recognised throughout the world. The world exploration authorities look at Australia and say: 'Australia is a country of poor prospectivity, of great costs for risks. You have developed , as the International Energy Agency has said, the optimum incentives to industry to explore and to develop.' The IEA says that we have done the optimum in developing our incentives. If that is so and if there is no reflection upon the ploughing back of profits, if there is a success story, if what we are doing is, in the eyes of the international community, the optimum, why would we disturb it? Why would we want to spoil a success story? Why would we want to threaten the minerals and energy industries at a time when they are at a perilous stage? The sooner the Government answers the questions on the resources rent tax, capital gains tax and off-shore legislation, the sooner we shall understand what it means and what it has in mind. The sooner the Government says whether it will be doing something about another kind of levy on oil, particularly new oil, the sooner we shall be able to evaluate what it is doing. Senator WALSH(Western Australia-Minister for Resources and Energy)(3.54) —I move: That the time for the consideration of this matter of public importance be extended until 4.15 p.m. Senator CHANEY(Western Australia-Leader of the Opposition)(3.54) —May I say how much I welcome this motion. The Opposition was deeply distressed at the decision of the Government and the Australian Democrats to restrict discussion on matters of public importance on these days to one hour. On the first occasion when we have been subjected to the restriction, I am delighted that the time should be extended. I congratulate the Government for its growing wisdom and yet another change of direction, which I think is very timely. Question resolved in the affirmative. Senator RICHARDSON(New South Wales)(3.55) —In relation to this matter of public importance, I am intrigued by the phrase 'the continuing uncertainty that the Government's proposal is creating'. It should first be noted, of course, that the Australian Labor Party has had a resources rent tax in its platform since 1977. Despite intensive reviews of our resources and energy platform at the two subsequent national conferences since then, that part of our platform referring to a resources rent tax has survived. It has been endorsed by the Party and the Government, and no one in the industry can complain that he is suddenly stunned and shell shocked because the Minister for Resources and Energy, Peter Walsh, would seek in some way to pursue his own Party's policy. The Government has been clear on it all the way through. That is in stark and marked contrast to the Liberal Party's attitude when in government. I would regard it as a fascinating discussion to go through with Senator Chaney his Government's record on its tax promises. In 1977 the industry had every right to be shell shocked and thunderstruck at the announcement that came in the Budget from Phillip Lynch, when he said: The Government is, meanwhile, examining whether the levy should be replaced by a resources tax. That was on 16 August 1977, a big day for the Liberal Party and the National Party of Australia, because on the same day, Doug Anthony, as Minister for National Resources, referring to world parity pricing, said: The new arrangements . . . will result in very substantial increases in the profits of each of the current producers. For this reason the Government is considering the application of a resources tax on these profits. Accordingly, the Government will be seeking early discussions with the relevant oil producing companies in these matters. Any decision on the future of the crude oil levy will be taken in the light of discussions on the resources tax. Mr Anthony again, only a few weeks later on 8 September 1977, in answer to a question without notice, said: There are good and sound reasons for looking at a secondary tax or a resources tax in respect of oil that has already been produced in Australia and in respect of areas in which profits will be greatly increased because of government decisions. The fact that we are pursuing a resources rent tax is not therefore, I would think, an example of the creeping socialism which Andrew Peacock sought to fight by getting donations from Senators Grimes and Crowley. Opposition senators might also remember Ian Viner-it is getting harder to remember him-who, in a speech to the LNG symposium on the west coast on 16 December 1977, had much to say about a resources rent tax, the tax which Opposition senators claim to be so threatening . He said: It should be emphasised that a resource tax can be designed so as not to impede the operation of the profit motive. In particular, the tax would not impinge upon marginal projects or upon projects earning only ordinary rates of return, as it would apply only to profits over and above ordinary levels of profitability, including appropriate allowance for risks in the industry concerned. He continued: A resource tax would then apply only to profits beyond some prescribed minimum level which allowed for risk. Furthermore, a resource tax would take from the community only a portion of profits above the threshold figure-there would be no 'ceiling' on the overall rates of return which companies could obtain from projects, as has sometimes been suggested. Highly successful ventures will therefore be able to earn very high returns. For these reasons, the tax would not discourage new exploration or serve to inhibit the full economic exploitation of known resources. Ian Viner was not known, as far as I am concerned, as one of the great socialists that Australia has produced. He was not known, as far as I am concerned, as someone who terrified the industry. Those words from him, from Doug Anthony and from Sir Phillip Lynch-- Senator Chaney —Well, what did they do? Senator RICHARDSON —How much of it did Senator Chaney attack at the time? I cannot find examples of his criticising them at the time. Those people, as usual , somersaulted with their tax promises. If one goes back to 1977 and that period one may recall other promises they made about tax relief. Great tax reductions could be introduced by the Fraser Government before elections, but how long did they last afterwards? As I recall it, it was a very short time indeed. Honourable senators opposite should be the last ones to talk about the record in regard to tax. Senator Chaney —This sounds like a speech on the means test. Senator RICHARDSON —It is pathetic to listen to that drivel. I wish to press on. Opposition senators-Oh! Senator RICHARDSON —I am pressing on in the same vein as Ian Viner, Doug Anthony and all those on the Opposition side of the chamber did seven years ago. Senator Chaney —You are not a member of the Centre Left if they are the people you are quoting. Senator RICHARDSON —I am uninterested in factions in the Australian Labor Party. I am here to support our policy. Let me talk about consultation with industry. It should be noted first and foremost that no tax can be proceeded with without that sort of consultation. Senator Peter Walsh has over the past few months gone to great lengths to ensure that it has occurred. Throughout 1983 he made a number of speeches on the resources rent tax and its possible introduction. Furthermore, in December of last year he handed down a discussion paper which has, of course, been widely disseminated throughout the industry and, indeed, throughout the public. In January of this year extensive meetings were held between industry representatives both from the Petroleum Exploration Association and from those individual companies which have been engaged in exploration over some years. Those consultations are still proceeding. What is more, the discussion paper, while it pointed out the reasons for a resources rent tax, also pointed out that there were areas of flexibility which the Government wanted to discuss with industry representatives. The case for a resources rent tax has been set out in that discussion paper. Without going through it all, I suppose it can be summed up by saying that anyone looking at it in a fair and reasonable manner must concede that the community should receive some compensation for the depletion of irreplaceable national assets and resources and that the community should share in the super profits that can sometimes be earned from these sectors of the resources industry. The profits can result from natural advantages. They can be high grade deposits, easy access to markets, et cetera and, in some cases, such as those referred to by Doug Anthony only a few years ago, profits can result even from government policy. The economic rent accruing from these projects can be enormous. The Labor Party and the Government seek only to tax those profits in excess of that required for an investor to begin and maintain production from a project That was stressed by Ian Viner in that statement that I quoted from at length just a few moments ago. The current situation is that the States and the Commonwealth are competing in a helter skelter, ad hoc way, each trying to get a cut of this economic rent. At the moment we have royalties, licence fees, freight rates and levies of all kinds on which both tiers of government compete with each other to see how much they can get out of the resources industry. It is inequitable and inefficient to allow that situation to remain. In our view, the only way to clear the air is to reduce or to get rid of those taxes rather than in some way trying to apply an additional tax to replace the existing taxes with a fair tax which is easily understood. To go through the present tax arrangements is probably not possible in the time allotted to me, but the excises on the production of old crude oil and on liquefied petroleum gas levied by the Commonwealth, when they are combined with the freight rates and, generally speaking, the production of well-head taxes in the States, will provide over time a great disincentive to further exploration. Surely a tax based on profits, upon capacity to pay, has to form the basis of any government's look at revenue from this area. As time has shown us in the last few years, Fortescue, that very big profitable field discovered in 1978 at which production began last year, will be the main venture affected by this tax. As far back as 1980 the Liberal Party in government, the industry and the Opposition in a welter of speeches made around Australia both inside and outside the Parliament acknowledged that there would have to be some sort of tax on Fortescue when it came into production. Paul Keating laid it out in his own inimitable fashion back in 1980 and it was one point of agreement between all concerned. Senator Chaney —The discredited shadow Minister. Senator RICHARDSON —In speaking of discredited former Ministers, I speak of the Fraser Budget deficit blowing out from $6 billion to $9.6 billion. The discredited former Minister, John Howard, and Mr Fraser, the architects of that, must have been looking longingly at Fortescue as a way out. While Fortescue cannot solve all the revenue problems of any government now or in the future, obviously any government would be stupid not to look at some form of taxation. As I have said already, it is hardly something new. Let us go back to the industry's response. We have heard it claimed that the entire industry is opposed to this tax. Over the last few weeks I have had the opportunity, as have a number of people in my Party, of being exposed to industry arguments on this problem. After a layoff for a couple of months I had to return to the office late in January so that I could meet with representatives of Esso who wished to put their case against a resources rent tax. I spent some time with them and I hope to spend more time with them over the coming weeks. A formal response from Esso to the Government's discussion paper has been circulated to the Government committees and we will have the opportunity of debating that within the Government's ranks over the coming weeks . Honourable senators heard Senator Peter Walsh in his speech referring to Mr Holmes a'Court and his comments. Mr Holmes a'Court, when he spoke of Senator Walsh's tax proposals, said that it was absolutely clear that a resources rent tax was a very sensible philosophy. The fact that he may well own the Broken Hill Proprietary Co. Ltd in a short period means that BHP's opinion of all this could have a radical change. I think it is also worth noting BHP's response to the Government on this matter. BHP is not exactly the strongest supporter of the resources rent tax, but its response shows that there have been major advances in its thinking. It states: By reducing financial exposure Government full exploration offsets can conceptually make the EMV-- that is, expected monetary values- neutral or positive. However, they cannot lower the exploration risk and by reducing the potential upside return to the successful explorer, RRT-- the resources rent tax- would reduce the reward, and thus explorers willingness to proceed. The fact, however, that BHP can state that full exploration offsets, one of the options currently available to the Government and being looked at by the Government, as being neutral or positive shows that the industry is moving along in its own thinking. Full exploration offsets are, I suppose, the main interest of the industry at the moment in examining how the Government will handle a resources rent tax. Time does not permit me to go through all of that, as I know that Senator Jack Evans is anxious to make a contribution. In conclusion, to try to rationalise what has been a complex and irrational set of taxes on this industry over so long is not something that the Government can attempt in a minute. It has hastened slowly over the course of a year. It has had intensive discussions with industry and right now departments are making a further examination of this question. The fact that the Labor Party has had this as its policy for seven years shows that we cannot be blamed for any uncertainty . The only certainty throughout that seven years has been that a resources rent tax was in our proposal. We never showed any signs in that period of backing away from it. Senator JACK EVANS(Western Australia)(4.10) —This whole area of the development of Australia's resources is of major concern to the Australian Democrats. In fact our policy since 1977 has been in favour of such a tax. We believe that the major cause of uncertainty over the last 20 years has been the refusal by the Australian Labor Party and the Liberal-National Party coalition to agree on a long term policy that puts Australia's interest first. The continuing disagreement between these two parties has been exploited by mining companies in order to promote their interests before the interests of Australia's long term development. This is clear in the consistent, theoretical divisions between the two parties on the question of ownership and control of Australia's resources where no Australian government, since the lessons of 1975, can take a strong stand against foreign interests for fear of the electoral consequences of a concerted anti-government campaign promoted by members of the Opposition of the day, whoever they may be, and supported by these foreign interests. In the interim, of course, Australia is at the mercy of the multinationals. Let us briefly consider this resource rental tax. I do not deny that there are problems with the resource rent tax. I do not deny that there is some uncertainty in the industry. I believe, however, that a lot of this uncertainty is caused by the divisions between the Labor Party and the coalition parties in this important policy area which gives the oil companies the leverage to promote their interests using the current Opposition as their mouthpiece. There is room for compromise between the oil companies and the Government. I believe that the Government is sincerely endeavouring to reach that point. I also believe that there is room for compromise between the State governments and the Commonwealth Government, but most importantly between the Government and the Opposition. The latter is important because resources development, like foreign ownership, is an area which requires a settled policy so that both foreign and Australian companies working in this area know clearly that Australia's interests will come first, whoever is in government. Australia needs to continue to develop its domestic oil producing capacity. I think we all agree on that. Those undertaking the risks of exploration ought to be rewarded financially for ultimate success. The costs of that exploration need to be taken into account when determining an appropriate level of taxation on the profits that are ultimately made. Taxing oil production represents a major source of income to the Government. It is currently at $3 1/2 billion per year. Despite an estimated decline in 1983-84 over the amount of income raised by the crude oil levy in 1982-83 it will still represent 7.2 per cent of the Government's total receipts. I am sure that the Opposition is not suggesting that we simply let that $3.5 billion decline and not replace it with an alternative tax. It seems that the Opposition has no alternative but is simply criticising a resource rental tax because it is something new and untried. I do not believe that Australia's attractiveness in terms of oil exploration and production depends entirely on the mode of taxation used. Certainly that is important. Certainly many firms fear the Government's resource rental tax proposals. But there is room for compromise and negotiation. Even this opposition is not uniform throughout the industry. If Her Majesty's Opposition and the Government were to make some compromises and move towards a settled policy in this area, the other incentives to explore for oil would become paramount. Companies will continue to search for oil if the demand for that product and the costs that they incur enable them to make a profit. Furthermore, as is true with all resources projects in this country, we offer a stable, political, social and economic environment. That is how Australia should sell itself rather than as a divided community. That is how Australia's interests could become the major criteria in determining the development of Australia's resources. The Government is in a bind. One question is: Does it give notice of proposed taxes and invite discussion and, of course, the concomitant criticism, or does it spring all its new taxes on us in one Budget session each August without community debate? In terms of this matter of public importance I prefer the former. I believe that this matter of public importance and the cynical point scoring that we have seen during this debate on a subject which will greatly affect the tax alternatives for all of us in the future may weaken the Government's desire for a democratic approach to such matters. I therefore appeal to the Opposition to withdraw this matter and to enter into a constructive non-partisan discussion with the Government and the Democrats to arrive at a minerals and energy tax policy which will benefit all Australians through to the next century. The DEPUTY PRESIDENT —Order! The time allotted for the consideration of the matter of public importance has expired. The DEPUTY PRESIDENT —Order! It being 4.15 p.m., under sessional order, I put the question: That the Senate do now adjourn. Question resolved in the affirmative. Senate adjourned at 4.15 p.m. The following paper was presented: Navigation Act-Marine Orders-1984-No. 2-Part 30 (Prevention of Collisions). The following answers to questions were circulated: (Question No. 621) Senator Messner asked the Minister representing the Minister for Administrative Services, upon notice, on 15 December 1983: (1) Has the Department of Administrative Services spent any money in connection with the proposed assets test program; if so, on what. (2) From what funds have these moneys been appropriated. (3) Who authorised the appropriations. Senator Gietzelt —The Minister for Administrative Services has provided the following answer to the honourable senator's question. (1) and (2) Yes; annual rental commitments totalling $1,836,605 and $485,021 have been entered into to date for the lease of accommodation for the Departments of Social Security and Veterans' Affairs respectively. The moneys were taken from the Department of Administrative Services rental appropriation, Division 130-4-01. In addition, 155 vehicles earmarked for disposal were withheld from auction for use by the Department of Social Security in connection with the assets test program. The vehicles would have realised an estimated $0. 57m at auction and delayed disposal will decrease their sale value. Revenue foregone would have been paid to the transport and storage trust account revenue item 00/24/20. (3) Appropriation, Division 130-4-01, was authorised in the context of the 1983 -84 Budget. Withholding the 155 vehicles from auction was done with the approval of the Department of Finance. The Minister for Finance has approved additional rental obligation for urgent accommodation requirements for the pensions assets test. (Question No. 635) Senator Mason asked the Minister representing the Minister for Foreign Affairs, upon notice, on 16 December 1983: (1) Does the Government believe it has an accurate assessment of the current situation in East Timor resulting from the Indonesian offensive which began in the wake of the visit of the Australian parliamentary delegation in July/August 1983 in the light of the regular briefings the Minister for Defence acknowledged receiving from his Department on developments of interest in Australia's neighbourhood (see answer to Question No. 469, Hansard, 30 November 1983, page 3082). (2) Is the Government aware of the report broadcast on Radio Australia on 7 December 1983 that Governor Carascalao had called for the restoration of order in the province and asserted that as a result of recent upheavals more than one quarter of the population were in serious need of attention from government agencies; if so, is this report in accordance with the Government's assessment of the situation in East Timor. (3) Are the restrictions imposed on International Red Cross operations in East Timor by the Indonesian Government, and detailed by the Australian Government in recent months, still in force; if so, has the Government made approaches to the Indonesian Government seeking the immediate lifting of all such restrictions; if not, when will it do so. Senator Gareth Evans —The Minister for Foreign Affairs has provided the following answer to the honourable senator's question: (1) Yes. (2) I believe that the Radio Australia report, to which the honourable senator has referred, was drawn from a statement made by Governor Carrascalao in early December 1983. As reported by the Indonesian Government, Mr Carrascalao said that more than 25 per cent of East Timorese still needed serious attention from all Indonesian Government agencies to overcome the difficulties they faced. The Indonesian Government has never denied that East Timor suffers from underdevelopment, as do many areas of Indonesia, and has devoted very significant resources and effort to tackle these problems. On a per capita basis , for example, the development budget for East Timor in recent years has been one of the highest of any Indonesian province. The report of the Australian parliament delegation that visited East Timor in July/August 1983 contains details of the efforts being made by the Indonesian Government to overcome these problems. (3) As a major contributor to the International Committee of the Red Cross operations in East Timor, the Government is naturally concerned by the restrictions which have been placed on relief activities on the main island and has made its concern known to the Indonesian authorities. The Government hopes that negotiations taking place between the Indonesian authorities and the ICRC will result in the ICRC being able to resume the full range of its operations without delay. While there has never been any doubt that relief operations on the main island have been suspended, the ICRC's family reunion and tracing activities are continuing. Also, the ICRC's food and medical program on Atauro Island has continued uninterrupted.