Tuesday, 6 March 1984 The PRESIDENT (Senator the Hon. Douglas McClelland) took the chair at 2 p.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 28 citizens) and Robertson (from 32 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned citizens respectfully showeth: That the Sex Discrimination Bill 1983 contains provisions inconsistent with principles of justice and equality which could be used to: Undermine civil liberties and religious freedoms; Entrench abortion funding and render liable to action Hospitals, Doctors and Nurses, who conscientiously refuse to become involved in morally objectionable operations; Deny to parents their rights to insist that the school ''community'' provide an environment conducive to the development, including moral development of their children. Your petitioners humbly pray that the Senate, in Parliament assembled; should amend the Bill so as to prevent the possibility of its use in the manner stated above and urge, because of the importance to society of all principles involved, that a conscience vote on the Bill be permitted to all Members of Parliament. And your petitioners as in duty bound will ever pray. by Senator Peter Baume (from 19 citizens). To the Honourable the President and members of the Senate in Parliament assembled. We the undersigned citizens of the Commonwealth do humbly pray that the Commonwealth government: 1. Uphold the principle that the seeds and cuttings of plants are a public resource and a common heritage to all and that accordingly seeds should be freely available to all, freely multipliable, able to be sold, exchanged, exported and imported by anyone who wishes. This is seen as a matter of national food security. 2. Recognise that plant breeding is a highly co-operative venture often involving private enterprise at the very last stages after basic seed collection , storage, and research has been publicly funded. 3. In view of the aforementioned paragraphs, recognise that any system giving ' property' or ownership rights over seeds to individuals, organisations or enterprises is inappropriate and unjust. 4. Recognise that legislation establishing plant patenting schemes overseas has had serious adverse effects namely: (i) a slowing-down of scientific information exchange and exchanges in basic plant breeding materials, that is, germ plasm, (ii) subordination and/or curtailment of public breeding programmes, (iii) farmer unrest at seed prices, (iv) monopoly control of seed production and sales has passed into the hands of giant petrochemical and drug corporations also marketing crop chemicals, (v) increased uniformity of crop varieties leading to a vulnerability to pest and disease attack. 5. Reject any proposal to legislate for any system such as the drafted Plant Variety Rights Act, which gives exclusive ownership rights over seeds to individuals, organisations or enterprises. And your petitioners as in duty bound will ever pray. by Senator Robertson (from 27 citizens). To the Honourable the President and members of the Senate in Parliament assembled: The petition of the undersigned shows- That, with the exception of the Australian Capital Territory and the Northern Territory, all State Parliaments have enacted chiropractic legislation. That chiropractors provide a safe, effective and economical health care service that is complementary to medicine. That the introduction of a Federally funded health care system restricted to the services provided almost exclusively by the medical profession restricts the freedom to select the health care practitioner of one's choice. That a financial disadvantage will be incurred by those citizens 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. And your petitioners as in duty bound will ever pray. by Senator Robertson (from 10 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned shows our concern of the Industries Assistance Commission's recommendations on Certain Consumer Electronics Equipment and Components; particularly the Colour Television Industry, and the effect it will have on employment in this Industry if accepted. Your Petitioners request that the Senate, in Parliament assembled, should take action to protect the employment and technological expertise possessed in this Industry. The action taken should be that of a Global Quota System maintaining the present 95 per cent of the market to Australian Manufacturers and an increase in the local content factor to at least 55 per cent on large screen (20 '' and above) colour televisions. And your petitioners as in duty bound will ever pray. by Senator Primmer (from 233 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned Citizens of Australia respectfully request: That the establishment of a non-official Post office at Southgate Shopping be not proceeded with and that the existing non-official Post Office at Sylvania and Sylvania Heights be upgraded to provide a greater range of services to the Public. We oppose the establishment of a non-official Post Office at Southgate Shopping Complex on the following grounds: (1) Expenditure by Australia Post on capital costs is not warranted including rental of $40,000 per annum. (2) Inconvenience to residents in Sylvania heights, particularly the aged population who would have a long walk to and from the proposed Southgate Complex . The establishment of a large drop box facility at Southgate, along with stamp sales from the Newsagency would serve the Central Area at virtually no cost to Australia Post. And your petitioners as in duty bound will ever pray. by Senator Gietzelt (from 464 citizens). Petitions received. Notice of Motion Senator GARETH EVANS(Victoria-Attorney-General) —I give notice that, on the next day of sitting, I shall move: That leave be given to introduce a Bill for an Act to amend the Judiciary Act 1903. Senator JONES(Queensland) —I give notice that, on the next day of sitting, I shall move: (a) That the Senate expresses surprise and regret at remarks made by the Queensland Minister for Maritime Services, Mr Goleby, on 1 March, describing the Painters and Dockers Union as 'stupid' for providing employment opportunities at Brisbane's Cairncross Dockyard for a handicapped Vietnam war veteran who lost an arm in the active service of his country, and urges that Government to adopt a more humane attitude toward handicapped persons in the future. (b) That the Senate notes remarks by the same Minister blaming industrial action for retrenchments at the dockyard on 27 February when the Annual Report of the Port of Brisbane Authority, 1982-83, states quite clearly that Cairncross Dockyard was almost free of lost-time disputation in 1982-83 and that this was the result of the implementation on 24 December 1981 of the Brisbane Ship Repairs Industry Industrial Agreement. (c) That the Senate deplores the policies of the Queensland Government that prevent the Cairncross Drydock from competing for Commonwealth contracts for RAN ship repairs, which is one of the genuine reasons 28 workers were sacked there on 27 February and urges that Government to ensure that practices in the management of the yard be changed so that it can compete for Commonwealth work in the future. Senator DURACK(Western Australia) —I give notice that, on the next day of sitting , I shall move: That there be laid upon the Table of the Senate without delay all those portions of the transcripts and transcripts of any tapes delivered by the Age newspaper to the Attorney-General which refer to any conversation between the judge and the solicitor or other conversations referring to the judge or in which he participated, together with the aide-memoire of the Attorney-General's discussions with the judge on 15 and 24 February, subject to the deletion from all documents of any name or identifying characteristics of individuals. Senator GRIMES(Tasmania-Minister for Social Security) —Papers are tabled in accordance with the list circulated to honourable senators. With the concurrence of the Senate, I incorporate the list in Hansard. Leave granted. The list read as follows- 1. Financial Information Furnished under the Airlines Agreement-Pursuant to clause 13 of the Airlines Agreement Act 1981. 2. Consultations on passenger revenue load factors and aircraft utilisation held during 1983, and air fares consultations held during 1983-Joint report of TAA and Ansett-Pursuant to Sub section 13 (3) of the schedule to the Airlines Agreement Act 1981. 3. Charter of Printing and Publishing Responsibilities-Document-Together with the text of a statement by the Minister for Administrative Services relating to the document. 4. Seven years on-Report by Mr Justice Toohey to the Minister for Aboriginal Affairs on the Aboriginal Land Rights (Northern Territory) Act 1976 and related matters-Together with the text of a statement by the Minister for Aboriginal Affairs relating to the report. 5. Health Insurance Commission-9th annual report 1982-83-Pursuant to Section 42 of the Health Commission Act 1973. Senator DURACK —I refer the Attorney-General to the offer which he claims he made in the debate in the Senate last night to make available to selected members of the Opposition on a confidential basis the aide-memoire of his conversations with the judge. When did he make this offer and to whom does he claim to have made it? Will the Attorney-General table the aide-memoire, not on any confidential basis which would prevent action being taken if such were thought necessary, but in a form which, while protecting individual identity, provides an accurate record of what was actually said at the two meetings? Senator GARETH EVANS —I made the offer to the Opposition in the course of the debate last night. I had thought there had been some earlier communication from office to office but on checking I found that the matter that I discussed with the staff member concerned, because of a failure of communication on my part, had not been communicated during the latter part of the afternoon. I do not propose to repeat that offer, given the circumstances that have developed and the way in which the Opposition has behaved; nor do I propose to table the aide- memoire in any fashion, sanitised or otherwise, for all the reasons that I explained last night. Senator BOLKUS —I refer the Minister representing the Minister for Foreign Affairs to the recent decision of the Marcos Government to prevent Filipino poet , Cirilo Bautista, from attending Writers Week in Adelaide last week and part of this week-a decision which had been made on the basis of one of Bautista's poems published earlier this year as a tribute to the assassinated Opposition leader in the Philippines, Benigno Aquino. I ask the Minister whether it has been brought to his attention that a message of protest against this decision, directed at the Marcos Government, has been signed by over 30 leading writers from 12 countries who are currently in Adelaide. In the light of these actions, can the Minister say whether the Australian Government will be making representations to the Marcos Government in support of the poet Bautista and his right to leave the Philippines? Senator GARETH EVANS —I have seen Press reports that, as Senator Bolkus said, the Filipino poet Cirilo Bautista has been denied permission to leave the Philippines to attend Writers Week at the Adelaide Festival. The Department of Foreign Affairs provides assistance for one overseas participant to attend Writers Week. The Department's involvement extends only to the provision of an economy class return air fare. On the advice of the organisers of Writers Week, the Department had approved the provision of such a ticket to Mr Bautista in November 1983. Mr Hayden has advised me that he has asked our embassy in Manila to check out the details surrounding the Philippines Government's alleged refusal to allow Mr Bautista to attend Writers Week. Certainly, I expect it will be the subject of further representations to the Philippines Government once the circumstances of that refusal are known. Senator MESSNER —I refer the Attorney-General to the case in 1974 when a Mr Ramon Sala, who was being held in custody pending deportation while police inquiries were continuing into other matters, was released at the direction of a former Federal Minister and had his passport returned so that he could leave Australia at a time of his own choosing. I ask: When did the Attorney-General speak to the former Minister? Did he see him alone? What did he say? Was any record made of the conversation? Senator GARETH EVANS —I spoke to the former Minister on, I think, one occasion about 10 days ago. I do not believe any formal record of that conversation was kept, apart from handwritten notes by me which I communicated immediately to Mr Andrew Menzies, a former senior officer of my Department, who was asked to pursue this investigation. I might add that a detailed response as to the Government's investigation of the Sala matter was given in writing to Mr Steele Hall half an hour before Question Time yesterday. In those circumstances I find it quite contemptible that Mr Hall should have used the opportunity available to him in Parliament yesterday, without any further reference to me yesterday afternoon, yesterday evening or today, to do what he did on that occasion; that is, to suggest that serious misconduct or impropriety of some form had occurred in 1974. The reality of that matter is otherwise. All the material available to me in the investigation carried out by my departmental officer when this matter first came to the Minister's attention about three weeks ago confirms that. Senator MESSNER —Mr President, I ask a supplementary question. I draw the Attorney's attention to those parts of my question where I asked whether he saw him-that is, the former Federal Minister-alone. What did he say in reply to the Attorney's statements? Senator GARETH EVANS —What did he say in reply to my questions or my statements? Senator Messner —What did he say to you? Senator GARETH EVANS —I will not tell Senator Messner what transpired in the course of a conversation aimed at eliciting a response of a former Minister to allegations made about him. I passed on the circumstances of those responses to the officer of my Department conducting the investigation in question, who reached the conclusion that the nature of the responses, as communicated by me, were entirely consistent with the course of events which, from other extrinsic evidence, and from other material gathered by the officer, he found to have been the case. I will not pursue every last Will-o'-the-wisp floated for reasons of ill motivation by the Opposition down every rabbit hole that Senator Messner or anyone else might try to dig for me. Senator CHILDS —Is the Minister representing the Minister for Immigration and Ethnic Affairs aware of the restrictions imposed by the South African Government on entry to and exit from South Africa? If so, can the Minister advise on the nature and extent of those restrictions? Senator GRIMES —I do not know all the details of entry and exit restrictions placed by the South African Government. In the last couple of days, in light of the discussion about the refusal of entry visas to two South African parliamentarians, certain information has come to light. For instance, the South African Government refuses exit visas to Bishop Desmond Tutu, who is a senior member of the Anglican community in South Africa. We all know that Winnie Mandela has been under a banning order at various times and has been refused permission to exit from South Africa. We know that the President of the South African Council of Sport, Mr Van der Horst, and the Head of the Christian Institute, Mr Beyers Naude, have been refused exit from South Africa. We know that the chances of any of the members of the black community in South Africa getting an exit permit are very slight. Certainly if they were going to criticise the South African Government they would get none. If they did get out and made critical speeches, they would not be allowed back. Many organisations are not allowed entry to South Africa. In particular, a blanket ban has been imposed on all staff of the World Council of Churches. A World Council of Churches official, Mr Russell Rollason, has been granted a limited stay in South Africa; otherwise there is a blanket ban on all the members of that organisation. I am sure that, as we go through various details of what happens in that unfortunate country, we will find that the amount of banning of exit from and entry to that country is far more extensive than we would ever consider to be the case. Senator MACKLIN — I preface my question which is directed to the Minister for Veterans Affairs by making reference to the fact that the Repatriation Act does not permit legal practitioners to appear before the various tribunals that come under that Act. Is it not a fact that briefs are currently prepared for non- legal practitioners who appear on behalf of the Repatriation Commission and that those briefs are prepared by legal practitioners or personnel with legal education within a department? Is it the case that legally trained officers appear for the Repatriation Commission, contrary to the spirit of the Act, in appeals before the Repatriation Review Tribunal? For example, is the First Assistant Commissioner, Legal Services, in the proper and ordinary sense of the word a legal practitioner? Has he completed any recognised degrees of legal studies leading to a legal degree or award? Has he appeared for the Repatriation Commission in appeals before the Tribunal? Senator GIETZELT —Senator Macklin has raised the question of legal representation before the Repatriation Review Tribunal, a matter that does excite some concern from time to time when the Repatriation Commission takes advantage of its rights and obligations to have such legal representation before a final court of appeal . I remind Senator Macklin, as well as the Senate generally, that the Repatriation Commission makes these decisions based upon the legal argument and what it considers to be its legal responsibilities. This is not a matter for the Minister or for the Department. Because the Repatriation Commission is a statutory authority it is able to act in its own right and make its own value judgments about these matters without consultation with the government of the day or the Minister. In those circumstances, whatever private views I might have on the matter, it is not competent for me to express other than a personal view to the Repatriation Commission, which acts on its own authority and under the provisions of legislation which is the responsibility of this Parliament. It is true, as Senator Macklin has suggested, that the First Assistant Secretary in the Legal Services Division and the Assistant Secretary have appeared before the RRT as advocates. I am advised that that happens from time to time because of the lack of suitable staff. That has not happened since November 1983 because, I understand, the Commission has found it necessary to engage legal representation on matters affecting legal interpretation. It believes that it has some responsibility to the Parliament to test these matters in the final court of appeal. As I have said before, many of these cases have taken 800 days to come before the Repatriation Review Tribunal and have run the gamut of all the determining processes. If there were cases which had legal implications, I think the Parliament would be asking questions as to why the Commission failed to avail itself of adequate legal representation before the final court of appeal if it did not do so. Generally speaking, the Repatriation Commission does avail itself of that opportunity. In response to the specific question Senator Macklin asked, I am advised that in only 2 1/2 per cent of the cases before the Tribunal does the Repatriation Commission avail itself of legal representation. Senator COOK —My question is addressed to the Minister for Education and Youth Affairs and concerns delays in processing applications for tertiary education assistance scheme allowances. In 1983 many students experienced long delays in having their applications processed, and delays appear to be occurring in some areas again this year. Can the Minister say what is the current situation in regard to the processing of TEAS applications? Senator RYAN —I am happy to report that, in contrast to the chaotic situation which I inherited last year from the former discredited Fraser Administration, the situation with regard to the administration of TEAS this year is considerably improved. The number of TEAS applications is up this year; in fact, I am advised it is higher by about 10 per cent than the number received in 1983. There are two main reasons for that. One is that our Government liberalised the family means test for eligibility for TEAS. The other, of course, is that the encouragement that our Government is giving to increased participation is having a marked effect and many more young people are seeking to enter higher education and are thus applying for TEAS. So there is a 10 per cent increase on the number of applications received last year. Despite this increase the administration is much more efficient. I am advised that, as of mid-February, some 70 per cent of TEAS applications received had already been assessed. A new system of issuing the actual payment is reducing the average turn- around time by up to two weeks. Under new arrangements adopted by the Department of Finance it has been possible to reduce the waiting time between approval of the application and the first payment to two or three days. In previous years applicants have waited several weeks for their first payments. In Victoria the turnaround time is longer than it should be because of problems associated with the removal of computing facilities from one building to another. This is a temporary problem and my Department has assured me that the processing is now being speeded up. I have instructed the Department to give high priority to the processing of TEAS applications and every possible effort, including overtime and the use of additional staff, is being used to expedite payments to students. Senator HILL —My question is directed to the Attorney-General. I refer again to the Sala case. Was the former Minister involved in the decision to release Mr Sala and return his passport one of the twelve persons interviewed by Mr A. C. C . Menzies, who conducted the investigation for the Attorney-General? If not, why not? If not, did Mr Menzies have to rely on what the Attorney passed on to him of the former Minister's recollection of his actions at the time and other extrinsic evidence that the Minister mentioned today? Perhaps the Attorney- General in his answer would advise us of the nature of that other extrinsic evidence. Senator GARETH EVANS —I have already indicated in answer to a previous question that I was the one who discussed the matter with the former Minister to seek his recollection and conveyed the content of that recollection to Mr Menzies who, to my knowledge, did not interview directly the former Minister in question. He was concerned, rather, to investigate the substance of the relevant departmental files and to investigate particularly the departmental and police personnel recorded in the file who had recorded various notations or who in other ways had participated in the original course of events. The essence of the matter can be very simply described. Without going into all the detail of it-this case is, after all, 10 years old and there is no conclusion whatsoever that justifies any suggestion of illegality, impropriety or anything else of that order-what happened was simply that this gentleman, Mr Sala, who had been the subject of a court prosecution for taking money illegally out of Australia and for being in possession of a small quantity of drugs, was dealt with by the courts, and fined rather than imprisoned, but was kept in gaol for a period of days thereafter, without any outstanding charge existing against him, or with any imminent prospect of any other charge being laid. He was kept there pending deportation following a deportation order that had been made, it seems, as a routine precaution by the Department of Immigration and the relevant Minister some days earlier, pending the outcome of the court case. The matter was the subject of representations to the then Minister, who took the view, quite properly, in my view, that we do not run the kind of system of justice in Australia that justifies people being kept in gaol for open-ended periods pending deportation, and that if there were no outstanding charges against the man he ought to be allowed to leave the country. The circumstances in which he left the country, by way of being given back his passport and buying his own ticket rather than being deported, occupy a further section of Mr Menzies' report to me. Those circumstances are simply as follows: It is quite common and routine practice for persons being deported to be given the option, if the circumstances are appropriate, to not incur taxpayers' expense but to go of their own free will. In this circumstance there was a question mark that had been raised about the validity of the particular passport that the person was holding, as to whether it may not have been a forgery. That matter was brought to the attention of the Minister, who took the view that the police had over four or five weeks to investigate that matter. The police failed to do so to the extent of having anything which would justify their apparently laying a charge against the person in question. Again, we did not operate in this country a system of keeping people in gaol on spec in the hope that some sort of evidence would turn up to justify a person's being the subject of further charge and detention in Australia, and under those circumstances he ought to be given his passport and allowed to leave. I believe that a further consideration that was relevant-and in the recollection of the former Minister was a consideration, although he could not recall how much weight he had given to it-was that the gentleman in question appeared to have Spanish origins and that he had been the subject of disciplinary and police proceedings by the then Franco regime in Spain in 1974. He had suffered imprisonment-this had all been put in evidence during his court case-for a period during which time he had had his genitals smashed by the heel of a Spanish guard as a result of which he believed himself to be sterile and regarded himself as likely to be subjected to further pains and penalties were he to be sent back to Spain, which was, of course, the only option for him as a Spanish national if he were to be deported rather than allowed his passport. Under those circumstances that seems to have been another consideration that was the subject of representations, so far as people can remember, and that seems to have been a further matter of influence, although that would not have been enough by itself had there been enough hard evidence around to justify a charge at that time. The files are noted with the comments of senior departmental officers in the Attorney-General's Department stating that they agreed with the course of action proposed by the Attorney-General. The matter as to the passport was the subject of a reference to the Department of Foreign Affairs to ascertain what would be the attitude of the country whose possible forged passport it was were he to be given back his passport in circumstances where it subsequently proved that it was a forgery. The file was also annotated with the response of the Foreign Affairs Department that in all the circumstances the country in question would appreciate that the decision taken was reasonable. I have gone into a little detail on this matter, perhaps more than was necessary; certainly more than was really demanded by the question. I have done so because I think it is very important in these matters to demonstrate for the umpteenth time that simply because some disgruntled citizen around the place, for whatever motive, chooses to put some half-baked version of a story on the public record, to brief journalists about it and to set them going in a great surge of excitement, to get them asking questions and to get the Toorak Times to run the detail of the story-that publication is utterly without any pretension to morality in these matters-that is not enough to justify the sneers and smears and the innuendoes about particular individuals, the way in which this case was used so blatantly by Mr Hall yesterday and the way it is being used by the Opposition at Question Time today. I have nothing but contempt for those who use this material in this way. I believe Parliament as a whole ought to respond accordingly to these sorts of questions when they are raised in the future. Senator TATE —Has the Minister for Industry and Commerce seen the report that Broken Hill Proprietary Co. Ltd is eliciting reaction to its proposal that Australia produce raw steel products for processing in various Asian countries as part of an international rationalisation of the industry? Does this indicate a further coming together of the thoughts and plans of top management in BHP and that of the Prime Minister during his recent China visit as to the future of the Australian steel industry? Can the Minister inform the Senate of any latest Government reflection or action in pursuance of these exciting possibilities? Senator BUTTON —The visit of the Prime Minister overseas, and particularly his visit to China, resulted in discussions with the Chinese Government about the possibility of some integration between the Australian steel industry and the Chinese steel industry. Following the return of the Prime Minister to Australia that matter was the subject of formal discussions with representatives of the steel industry and the iron ore industry in Australia. As a result of those discussions a joint working party has been set up between the Chinese Government and the Australian Government to examine the possibility of integration of those activities. That working party will be busy for the next month or two and will then report to both governments in respect of that possibility. Yesterday at the seminar in Melbourne the Chairman of BHP, Sir James McNeill, in an address to the conference, referred to the question of there being some degree of integration of the Australian steel industry with the steel industry, such as it is, in various countries of the Association of South East Asian Nations. That statement by Sir James McNeill is a particularly welcome one inso- far as the Government is concerned. It is certainly related to the initiatives taken by the Prime Minister when in China and it is vitally relevant in terms of the Government's approach to trade and industry policy that all those possibilities be explored as vigorously as possible. It is very encouraging from the Government's point of view that, in a situation in which there is world overcapacity in steel, the initiative should be taken in Australia to look at the possible integration of steel industries in South East Asia and Australia as , in a sense, a parcel solution to that overcapacity problem. Senator Peter Rae —It was all looked at years ago. Senator BUTTON —Of course it was all looked at years ago. I suppose the honourable senator will tell me next that BHP has been trading with China since 1891. That is true. The honourable senator has been sleeping in the Senate since 1961, as I understand it. But that does not mean that all these opportunities should not be explored as vigorously as possible, which is the point I was making. I think even Senator Rae would welcome a statement by the chairman of a company such as BHP which is indicative of an increasingly outward looking approach in Australian industry rather than the sort of introspective, inward looking approach which has been present for too many years and which has resulted from various policies of previous governments which have seen Australian manufacturing industry and productive capacity totally concentrated on satisfying a domestic market with very little emphasis on the importance of exports to this country. It is very welcome to see, particularly in an industry such as steel where, as I have said, there is world overcapacity, that within Australia initiatives are being taken in an outward looking way to try to overcome some of those problems and provide a better basis for the development of the industry both in Australia and in South East Asia generally. Senator BOSWELL —Will the Attorney-General table forthwith the report prepared by the former officer of his Department, Mr Menzies, who investigated allegations that a former Federal Minister had in 1974 improperly ordered the release of Mr Ramon Sala from detention and the return of his passport? Senator Gietzelt —Where have you been for the last 12 days? Senator GARETH EVANS —I think Senator Gietzelt's interjection has said it all; where indeed has Senator Boswell been? I have given an indication as to the content of that report. I will give consideration and ask the Government to give consideration to the question of the tabling of the full report. Senator ZAKHAROV —My question is addressed to the Minister representing the Minister for Employment and Industrial Relations. Is it a fact that in 1982-83 the apprenticeship intake was the lowest for 10 years? What steps is the Government taking to increase the number of apprentices trained and so ensure both an adequate skilled work force and a secure future for more young people? Senator Peter Baume —I hope it is not a Dorothy Dix question. Senator BUTTON —Senator Baume points out, with his usually lucid degree of perception, that the question is what might be called a Dorothy Dix question. I congratulate him on that. Senator Zakharov gave me notice of this question because, unlike many other senators, I would not have at my finger tips details of the precise decline in the number of apprenticeship during 1981-82. I plead guilty to that. In 1981-82 there was a decline of 32 per cent in the apprenticeships intake. That has resulted, and of course will result, in a reduction in the supply of skilled labour for particular trades. The decline in the apprenticeship intake in 1981-82 was very much dictated by the recession at the time. I think there is very little doubt that in the environment of the recession employers were not keen to take on apprentices. Probably there was less demand for apprenticeship places than otherwise might have been expected. But, of course, the Government is concerned that as the economy recovers there will be adequate skilled apprentices and tradesmen available for the skilled work force to take part in the recovery and the restructuring of industry in Australia. Because of those concerns the Government has recently offered a package of incentive measures to employers to increase the attractiveness to them of apprentice recruiting. The first thing the package includes-if I might just itemise it briefly-is the maintenance of the real value of assistance under the Commonwealth rebate for apprentice full time training scheme by increasing all rebates by 4.3 per cent. Secondly, a special tax exempt additional apprentice employment rebate of $1,500 is available to employers who increase their apprentice training effort. Employers will be paid that rebate for putting on additional apprentices. Specific action is also being taken under the package to encourage the increased recruitment of female apprentices. Senator Ryan —Hear, hear! Senator BUTTON —Senator Ryan will supply the details if necessary. Assistance to graduates of trade base pre-employment courses is available by way of a $750 tax exempt payment in respect of each graduate employed and subsequently indentured. Those measures contained in the package are in addition to other measures which the Government has taken in relation to technical and further education training . I also remind the Senate that the Government is addressing the question of labour market skills generally by a review of labour market programs which is being conducted under the direction of Mr Peter Kirby, currently a senior officer of the Victorian Government. Senator WATSON —My question is also directed to the Attorney-General. I preface it by pointing out that over the past four days of questioning the Attorney- General has assured the Senate that outside legal opinion and his own meetings with the judge referred to in the Age tapes have convinced him of the correctness of the judge's behaviour. Are there any grounds on which the Attorney-General could be regarded as having a possible conflict of interest in his dealings with this matter? The PRESIDENT —Insofar as the question does not seek a legal opinion, I will allow it. Senator GARETH EVANS —The asking of the question does no more credit to the honourable senator than Mr Howard's contribution to the debate yesterday did credit to that gentleman. No, there is no foundation on which any reasonable person could possible come to the conclusion that there is any conflict of interest in this matter. Senator ROBERTSON —I direct my question to the Minister for Social Security. It refers to programs of early intervention for intellectually and emotionally handicapped children. Is the Minister aware of the education program for infants and children-EPIC-in Victoria which has been a successful early intervention program for some years? Is it the intention of his Department to continue to assist the organisation operating this program? Senator GRIMES —I am aware of the education program for infants and children which is called EPIC and which is conducted at the Phillip Institute of Technology at Bundoora in Victoria. It is an early intervention program for intellectually handicapped children. The Department of Social Security funds several such programs. We have been considering how far this sort of program is related to child care and how far it is related to education. It is most likely, I think, that the Commonwealth Schools Commission will take a major interest in programs which have an education focus, although it will probably not take responsibility for them until some time in 1985, if then. My colleague Senator Ryan may have something to say about that. In the meantime, we are continuing to support the program at the Phillip Institute of Technology through the Office of Child Care. In the next 12 months the grant will increase from $106,000 per annum to $151,700 per annum. EPIC has a very impressive record. Its success rate in the integration of its children into regular services has been remarkable in that 75 per cent of all EPIC graduates and 95 per cent of Down's syndrome children from this institute have gone on to make use of regular children's services in schools. I went to the centre a couple of years ago. I have seen its work. I have seen its early training videos. The encouragement the children are given to develop the full stretch of their physical and intellectual capacities is very impressive. I hope that the enthusiasm of the teachers, the researchers and the parents at this important centre continues. They will certainly have the support of this Government. Senator JESSOP —I ask the Minister representing the Prime Minister whether he recalls that, when justifying the Government's decision to allow offices to be established in Australia for the African National Congress and the South West African People's Organisation, two organisations committed to violent change in South Africa, Mr Hayden said that their activities were 'legitimate and accorded with the operation of a free democratic society'. In addition, the Government has allowed individual ANC representatives to come to Australia for a month, as I understand it, to present their point of view with respect to current affairs in South Africa to the public of Australia. How was the proposed week-long visit to Australia by two moderate elected representatives, Messrs Durr and Rajab, different in principle? In what way does their visit not accord with the operation of a free and democratic society? Does the Minister further recall that a gallup poll conducted last year indicated that 62 per cent of the people said that trade between Australia and South Africa should be encouraged, 72 per cent said that official sporting contacts between the two countries should be encouraged, and 75 per cent wanted Qantas Airways Ltd to resume services between Australia and Johannesburg? In view of this significant public demonstration of feeling on this subject and in view of the fact that the Prime Minister is the champion of consensus and fairness and a person who desires to bring people together, I ask the Government to issue those visas immediately. Senator Gietzelt —Mr President, I take a point of order. It is clear that the honourable senator is giving information to the Senate. He is not asking a question, and as such he ought to be called to order and asked to question the Minister in the appropriate way. The PRESIDENT —Order! A lot of information was given in the honourable senator's question, which has now been asked. I ask the Leader of the Government in the Senate to respond to the question. Senator BUTTON —I have been a member of the Senate for only 10 years now, but in the whole of my time here that is the most confused question I have heard. The first thing it confuses is Senator Jessop's alleged commitment to high principle . He supports his commitment to high principle by citing gallup polls as if the two questions were intimately connected. I am not the least surprised that the majority of Australians expressed the views which they expressed in those gallup polls, but to confuse those answers in the gallup poll with the sorts of arguments of high principle which the honourable senator began with seems to me to be bordering on the bizarre. The second bizarre thing about the question, of course, is that it really should have been directed to the Minister for Foreign Affairs. If the honourable senator is asking me whether I recall what the Prime Minister recalled-and that is what he did ask-about what Mr Hayden said last year about these matters, I only have to answer no, I do not recall what the Prime Minister recalls about what Mr Hayden said last year. I am sorry, I have no recollection of that at all . A further part of the question asked whether the Prime Minister, being a popular figure, the champion of civil liberties, the most successful Prime Minister in the history of this country, and all those things which Senator Jessop-- Senator Gareth Evans —If not the world. Senator BUTTON —If not the world. With the Prime Minister being all those things to which Senator Jessop refers, I am asked whether the Prime Minister will intervene in this matter to give a visa to these couple of people who are coming here for some conference, the added motive being to teach the left wing a lesson , for goodness sake. Will the Prime Minister do all these things? I will ask him . I am sure that, in answer to that ludicrous question, Senator Jessop will get an answer which he deserves. Senator COLSTON —I direct my question to the Minister representing the Minister for Health. Has the Minister's attention been drawn to today's editorials in the Courier-Mail and the Daily Sun? Is it correct, as stated in the Courier-Mail, that when the Queensland Government signed the Medicare agreement yesterday it did so on virtually the same terms as it was offered a month ago? Is it also correct, as stated in the Daily Sun, that Mr Bjelke-Petersen's stand against Medicare was a tactical blunder? Has Mr Bjelke-Petersen claimed that Queensland 'won' agreement for a special Commonwealth Grants Commission on its case for additional funds? If so, did not the Commonwealth state many months ago that Queensland should take its case to the Grants Commission? Senator GRIMES —Yes, my attention has been drawn to the editorials in the Courier -Mail and the Daily Sun. I think Senator Colston drew them to my attention actually. In the Daily Sun the headline is 'Medicare row is Jo's big blunder'. It is interesting that both papers take the same line, as Senator Colston has said-they reflect the indignation felt by many Queenslanders about the thoughtless and petty game playing in which the Premier of Queensland has been indulging to the detriment of not only his own Government but all the people of Queensland. Mr Bjelke-Petersen has procrastinated to absolutely no avail over the signing of the Medicare agreement. His signature on the agreement yesterday was a signature on an agreement giving the same terms as those that the Queensland Government was offered over a month ago. Not only has he made a political blunder, he has involved to an unforgivable extent the welfare of the people of his State in his actions. Because of the refusal to sign the Medicare agreement, Queenslanders were deprived of some $6m a month to upgrade the levels of patient care in the public hospital system. As a result of the Queensland Government's decision, the people of Queensland will now receive the benefits of the $6m per month Commonwealth grant that the Queensland Government had denied them by refusing to sign the agreement before. The Minister for Health advised the Health Insurance Commission-- Senator Walters —Then what is the Minister talking about? It is a lot of rubbish . The PRESIDENT —Order! Senator GRIMES —I really have some difficulty with the high intellectual content of Senator Walters's interjections. I understand that yesterday the Minister for Health advised the Health Insurance Commission that as a result of the signing of the Medicare agreement, the Commission would be in a position to bring down its private health insurance contribution rates and to make appropriate adjustments so that contributors received back any extra payments that they may have made while the Queensland Government refused to sign the agreement. In addition to this benefit, private insurance rates will be able to be based on a charge of $80 a day rather than the $120 a day which was the case without the payment of Commonwealth funds. Mr Bjelke-Peterson apparently says that he has won the case. He has signed an agreement which is exactly the same as the agreement that he has been refusing to sign for the last month. It has taken him a month to sign the agreement, and all the benefits that the Queenslanders would have received will now be received continuously. But, what is more important, the agreed reference to the Grants Commission could have been secured a month ago. It is exactly the same reference as that which the Federal Government offered back in early February. I just think it is a pity that Mr Bjelke-Peterson carries on in this way. But as the Courier-Mail said: Now the agreement has been signed, much of this confusion should disappear. And now the federal money is flowing into Queensland hospitals, perhaps the health Minister, Mr Austin, will find that his Department can employ more nurses. That will give the people of Queensland the services they desire. I think it is quite silly-I always have done-that the Premier of Queensland and his Health Minister should behave in this way to the detriment of patients in Queensland public hospitals and Queenslanders generally. Senator KILGARIFF —I direct a question to the Attorney-General. I note that last Thursday, 1 March, the Attorney-General refused to accept any authority in regard to the case of Michael and Lindy Chamberlain. He said the matter was entirely the responsibility of the Northern Territory Government. In view of these statements, does the Attorney-General consider that since the Northern Territory acquired self-government the Territory has received plenary legislative and executive powers? If so, how does the Attorney-General explain the apparent contradiction between his denial of any authority of the Federal Government to interfere in the Chamberlain case, on the basis that it is a Northern Territory matter, with the Government's stated intention to interfere in another Territory matter, namely, the criminal code? Will the Attorney- General give some indication of when and in what circumstances the Federal Government will in the future seek to interfere in the Northern Territory's affairs? Will the Attorney-General outline the Government's perception of the term 'self-government'? Senator GARETH EVANS —My recollection, although I will need to check this, is that the terms of the Northern Territory (Self-Government) Act retain a residual capacity in the Commonwealth Government through the Governor-General in Council to override or to recommend changes to Northern Territory legislation based on the provisions of that Act. It is my recollection that that does not extend to overriding executive decisions of the Northern Territory Government, even though the case be a good one. As I said, I will have to check that, but in answer to the question my belief, at first blush, is that that is so. More importantly, one has to look at the actual merits of these competing situations. So far as the Lindy Chamberlain affair is concerned, despite its bizarre-to use Senator Button's favourite word-characteristics as a case and the popular attention it has excited-- Senator Button —That is not my favourite word. Senator GARETH EVANS —Well, it is one of the honourable senator's favourite words. He used it a couple of times today. It is a good word-an excellent and very appropriate word. The honourable senator's use of it today reminded me how good a word it is. In circumstances of this case, despite its idiosyncratic characteristics which have made it the subject of such popular attention, it is essentially an ordinary matter to do with the administration of criminal justice by reference to familiar standards of criminal proof in the context of the familiar offence; that is, murder or manslaughter, as the case may be. There is nothing to suggest that the criminal process has been other than followed in a normal and entirely satisfactory manner through all the successive stages of appeal. When, however, we are talking about the Northern Territory criminal code a very different situation confronts us. This criminal code has brand new provisions, many of them highly questionable and highly challengeable but four of which in particular raise absolutely fundamental questions about the terms on which Australia as a nation has adhered to the International Covenant on Civil and Political Rights. It also, in at least one instance, raises fundamental questions about the whole Anglo-Saxon tradition of criminal law that we have inherited and hitherto applied all around the country. There is a head-on challenge to those concepts and those principles in a number of provisions of the code which have been the subject of a quite lengthy process of communication and negotiation between the two governments. The course of action that is proposed at the moment does not yet, I believe, justify the description 'interference' as Senator Kilgariff has employed it. We have made clear our belief that certain aspects of the code ought to be amended. The most recent communication from the Prime Minister to the Chief Minister has indicated that if no satisfactory response to our latest communication is obtained within a short period, we will recommend to the Governor-General that he in turn recommend to the Northern Territory changes to the code. That is still not interfering to the extent of applying different provisions or repealing or disallowing particular provisions of that code. That is a further step that could be contemplated at the end of the road, but all of us hope that will not be necessary. Mr Everingham responded to that last letter of the Prime Minister, I understand a few days ago, saying that he wants to have a meeting with the Prime Minister and me to discuss this matter further. The Prime Minister has today written back to Mr Everingham, having consulted me before sending the letter, saying that he, together with the Attorney-General, would be happy to meet Mr Everingham to discuss the matters in issue. That is where the matter presently rests. I hope that meeting will take place in the near future. I hope that sooner rather than later an appreciation of the fundamental principles involved in this matter will strike Mr Everingham and that he and his Government will behave perhaps a little bit more sensitively that they have to date. Senator CROWLEY —I ask the Minister for Social Security whether he has seen the item in today's Australian Financial Review headed 'Macphee seeks public funding for child care', in which Mr Macphee is reported as saying that the ready availability of cost effective, quality child care was: . . . crucial to the ability of parents to exercise their rights as individuals to equality of opportunity. He called on the Hawke Government to improve on what he said had been a poor performance in this area. Can the Minister set the record right with regard to this Government's performance in the child care area, particularly in light of the Fraser Government's years of principled neglect and Mr Macphee's difficulties in persuading his colleagues to such views? Senator GRIMES —I have not seen the article referred to by Senator Crowley but I will look at it with interest. I find it an interesting and extraordinary statement, coming from a Minister in the previous Government, especially a government that had what was euphemistically known as a year of consolidation and review in the children's services area, which meant that it did not spend any extra money in that year. This Government has had increased expenditure of $ 10m in the children's services area. I am sure that next year we will have more increased expenditure. We have directed those funds to areas of greatest need. We are reforming the system so that we can introduce a planning model for the introduction of new children's services schemes rather than the existing submission model which inevitably, as we all know, favoured those areas where more articulate, wealthy people lived. We have expanded the areas in which we are willing to assist. For the first time 24-hour day care services have been funded. We are looking at innovative areas throughout the whole system of children's services. In particular, in co- operation with the New South Wales Government, we have continued and will expand a program started by the previous Government whereby the New South Wales Government provides land, either through local government or through the Land Commission. That Government has developed standardised plans for children's services and, through its Department of Housing and Construction, is developing standardised techniques for building these children's services so that the costs have come down considerably. Mr Walker, the New South Wales Minister, and I will be announcing shortly another large batch of children's services programs in these areas. Having consulted the various groups concerned with child care in the community, we are in the process of developing a new system of subsidies for the special economic needs in the area so that the system will be more simple, so that we will direct funds more to those who need them and so that we can more efficiently and economically develop the sort of children's services program that this country needs. I do not think there is any justice in Mr Macphee's remarks. I think any comparison between our program and our attitude in this area with that of the previous Government will make it quite clear which government shows the most interest and has developed the most services. Senator LAJOVIC —My question is directed to the Minister representing the Minister for Immigration and Ethnic Affairs. Following the detailed answer given to the question asked by Senator Childs regarding the possibility of exit visas from or for South Africa, could the Minister inform the Senate in similar detail what are the rules of exit visas from the Union of Soviet Socialist Republics; in particular, thousands of Jewish and other USSR citizens who wish to leave the USSR? As the reason given by the Government to deny entry to two South African parliamentarians was given on the grounds of the restrictive policies of the South African Government in relation to its own citizens, I take it, therefore, that since this is the new policy of the Labor Government the same restrictions in respect of visas will apply to all USSR citizens until they are free to travel. Senator GRIMES —I do not even think that was a very good try. I have not said that the decision about the refusal of entry to the two South Africans was justified by the restrictive policies of the South African Government in these specific cases. I answered a quite specific question by Senator Childs. I certainly do not support, and I am on the record many times accordingly, the restrictive practices of the Government of the USSR, the Government of East Germany or any other Eastern bloc government that Senator Lajovic might like to quote. I said in answer to a question yesterday that the decision about the two South African members of parliament was made on the basis of those individual cases. These South African MPs were coming here under the auspices of the South African Government for propaganda purposes. Seminars were organised by the South African Government representatives here. Fares and expenses were paid for people to come to those seminars which were going to be confidential or secret. In the light of the fact that Australia has signed the Gleneagles Agreement to signify that it is opposed to apartheid-all parties in Australia are supposed to be opposed to apartheid-we were not going to have the sportsmen bear the brunt of it. In this particular situation, a decision was made that the members of parliament would be refused entry. Of course, this Government and other governments have refused entry to representatives from the USSR and other countries of that type. I dare say they will again. But to suggest that the refusal of the South African Government to allow critics like Bishop Tutu and others out of the country is the sole reason for the refusal of the entry of these two people is not something I have said, the Minister of Immigration and Ethnic Affairs has said or the Minister for Foreign Affairs has said. Senator PRIMMER —Is the Minister representing the Minister for Foreign Affairs aware that the Department of Foreign Affairs did not contact Mrs Van Dartel during its investigation of her allegations concerning misuse of the diplomatic bag and security breaches? In light of this, can the Minister seriously suggest that the departmental investigation was anything other than farcical? Senator GARETH EVANS —I am not aware of the precise circumstances of the departmental investigations in this particular matter but I will endeavour to find out and give Senator Primmer a reasoned reply. Senator WALTERS —I direct a question to the Minister representing the Minister for Health. Has the Minister for Health instructed the Health Insurance Commission to issue its own receipts to patients who are claiming reimbursement from Medicare of payments to doctors? Has this been hastily arranged following a flood of complaints from Medicare staff who were illegally retaining doctors' receipts? Has the Minister publicly announced the procedure? If not, why not? What are the details? Will patients be able to receive their own receipts, which are legally theirs, from their own doctors? Senator GRIMES —I do not know. I will find out. Senator FOREMAN —My question is directed to the Minister for Social Security. In light of the recently released discussion paper on income support for young people, prepared by the Office of Youth Affairs and the Social Welfare Policy Secretariat, when can we expect some decision to be made in relation to the level of unemployment benefit paid to 16 and 17-years-olds? Senator GRIMES —The discussion paper referred to by Senator Foreman was released by Senator Ryan and me a couple of weeks ago. Its purpose was to inform people about the multiplicity of payments for young people in the community, the complexity of the system we have, and also to point out the very real difficulties we face in trying to reform the system in this area. Neither Senator Ryan nor I, however, is satisfied with a situation where some 66 per cent of young people in this country are either in the work force or unemployed and receiving inadequate benefits, whereas in comparable countries the percentage is very much lower-about 34 per cent of those aged between 15 and 19 years. We would like to see more people remaining in the education system and receiving training and preparation for life in the work force, whatever that life may be. At the moment we are asking interested people to read the document and to contact us with submissions and ideas. We are looking at many options. In the meantime, of course, we will not forget the unemployed aged between 16 and 18 years. Their benefit was increased last year. Whether it will be increased this year and by how much will depend on Budget discussions which will commence shortly. The Budget is the appropriate time to make such increases. We will be able to make more radical changes to the system which, incidentally, now has 36 or 37 different payments to youth for various purposes. Any changes depend very much on how quickly Senator Ryan, I and others can develop policies in this area which are not only desirable but workable. Senator GARETH EVANS —I seek leave to make a statement on the basis that I claim to have been misrepresented. Leave granted. Senator GARETH EVANS —I have just been handed a note describing an exchange at Question Time in the House of Representatives today in which the Leader of the Opposition, Mr Peacock, mounted an attack on me for allegedly suggesting on Radio 2GB this morning that there might be some connection between the bomb attack on the Family Court judge's home in the early hours of this morning and the verbal attacks on the judiciary which, most regrettably, have taken place in this chamber in recent days and, indeed, in the Parliament as a whole. It was suggested that that was a quite outrageous sentiment on my behalf. Let me put it in context and explain my position. As I recall, I was awoken by Radio 2GB at about a quarter to seven this morning, having gone to bed, I add at about half past one. In a rather sleepy and befuddled condition-indeed, I think early morning interviews can count as cruelty to dumb politicians-I heard the news for the first time of the attack on the judge and I was asked to utter some appropriate responses. Of course, I expressed my shock and horror at it. Thinking aloud, really, I said that it seemed to me that the kind of attacks that had occurred in the Parliament tended to encourage the kind of community climate in which crazies would be likely to be moved to perpetrate outrages of this kind. It was an essentially innocuous sentiment and not intended to have any more weight than that. Shortly after I put down the phone it started ringing with a series of calls from other stations. It occurred to me that sentiments of that kind, while perhaps having some objective justification, were likely to be misconstrued. Certainly I did not want to suggest, or to be taken as suggesting, that for all the other outrages the Opposition has perpetrated in recent days it would in any way lend any degree of support whatsoever to the kind of outrage that occurred in this instance. So long as there is any possibility of a misconstruction of that kind being attached to remarks of this kind, I certainly would not make them. Indeed, without revealing the secrets of the Party room, when I was asked a question in the Party room this morning as to whether the Government would make something of the possible connection between attacks of the kind that have occurred on the judiciary and the attack on the judge, I expressed in very strong terms my view that it would be quite inappropriate to do so and that we should make no statement of that kind. I believe my Party colleagues will vouch for that. I assure honourable senators that it was a quite unprompted response on my behalf. Against that background the allegations and suggestions of Mr Peacock assume their proper status. Because other people have chosen to occupy the political gutter in this country in recent days it does not mean that we on this side of the Parliament will go down there and join them. The PRESIDENT —I have received a letter from Senator Chaney proposing that a matter of public importance be submitted to the Senate for discussion, namely: The failure of the Attorney-General to respect the role of the Parliament and to respond properly to the issues raised by the 'Age' tapes. 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)(3.11) —I suppose the personal explanation which has just been given by the Attorney-General (Senator Gareth Evans) is a nice example of why the Opposition has so often had cause for complaint about him. He has a tendency to speak without thinking and certainly a tendency to act without relating his actions to the principles he is so keen on espousing in this place. We bring this matter of public importance forward because we regard the issue before the Parliament as a serious one. We think it is important to remind the Parliament what it is that we face in the issue of these tapes. I take the most down-played version of what has been displayed by the tapes in quoting the opinion of Ian Temby, QC, who said on the basis of the material that it 'is not consistently salubrious'. I think most of us would regard that as a fairly extraordinary understatement. He went on to say: Several of those who have spoken, if they could be identified, would be hard put to deny general involvement in activities including illegal bookmaking, race -fixing, bribery, and prostitution. In the same opinion Mr Temby very gently referred to matters raised about the judge. Even Mr Temby said in reference to the association between the judge and the solicitor: It places a judge in an invidious position if he has frequent dealings with any person of poor reputation. Presumably (the Judge) now realises this and will act more carefully in the future than he has done in the past. If there is doubt in this regard, it may be that he should be approached and advised as to the desirability of not further nurturing the relationship he has with (the Solicitor) if it presently remains on foot. I suggest that that lawyer-like understatement is reflective of the best complexion that one could put on what has been exposed by these tapes. I refer to what a notable lawyer, Dr I. C. F. Spry, said in a letter to the Age last Saturday when he referred to the fact that the 'Federal judge is alleged to have engaged in questionable conduct'. In fact if one looks at the accounts which appeared in the Age newspaper one finds not merely reference to the network of illegal behaviour that is raised by these documents but also a series of allegations about a person who is described as a senior judge-allegations of a sort which I believe no ordinary Australian would regard as in any way appropriate as coming from a judge. I do not believe that in the jury of public opinion there would be any possibility that the behaviour allegedly exposed in these tapes would be regarded as acceptable on behalf of a judge. If this set of tapes stood alone as a simple, single peak on the landscape I suppose the Opposition's concern to press this matter might be regarded as excessive. The reality is that this is just one of a depressing succession of similar revelations. We have had a succession of inquiries and we have had a succession of results. At the moment it is fashionable for Labor politicians such as the Attorney-General and Mr Wran to complain that people are saying that there is fire when there is merely smoke. I remind the Senate that in Australia we have a lot of allegations of smoke and a lot of evidence of smoke. We have had inquiries by such people as Mr Justice Street, Mr Costigan, QC, and Mr Justice Stewart. Those gentlemen have certainly exposed plenty of smoke but the record of recent years shows, I suggest, that there is plenty of fire too. There was plenty of support from the Labor members of this place when the previous Government moved to take action against organised crime and tax evasion . Indeed their complaints were that we were not moving strongly or harshly enough. However, over recent months we have seen people such as Mr Humphreys convicted as a result of one of those smoke inquiries. We have seen Mr Farquhar committed for trial because of one of those smoke inquiries. We have seen Mr Jackson resign from his ministry because of exposure about things which conflicted with what he had said in Parliament. We have seen a senior policeman, Mr Allen, affected by those inquiries. It is short term electioneering and political nonsense on the part of the Labor Party, of Senator Evans and the Government generally to try to reduce this to some suggestion that we are dealing with smear and with matters which are not of great public moment and immediate concern. This is not a matter which the Opposition has suddenly produced on the eve of an election. As I have said before, these matters have been produced by independent journalists in the main. From where did they get their raw material? I cannot be sure of that but I put the very firm view that the great bulk of this opinion comes to journalists because of the frustration of honest policemen who believe that inquiries are not going to be followed through to fruition. In any event there is a real problem which has to be tackled and which goes to the very substance of Australian society and Australia itself. In the instant case the clear tactic of the Attorney-General is to contain and suppress these matters instead of fearlessly pursuing them. That tactic preceded the announcement of a State election in New South Wales. Last week the Attorney- General refused to answer questions which were put to him by the Opposition. He refused to make material available. He made some admissions of fact but he was very careful about what he did. Since the election was announced he has made greater efforts. I believe that the transparency of the Attorney-General's approach is made most evident by his action late in the sitting yesterday. When the question of the adjournment of the tapes debate came up for consideration and the adjournment was moved by Senator Macklin, what did the Attorney-General do? He moved a motion that the matter be made an order of the day, not in the normal course for the next day of sitting, but for the first sitting day after 25 March 1984. It appears on the Notice Paper as an item of business for the first sitting day after 25 May 1984 because that is where the Attorney-General wanted it. He laughed at the time because, of course, his tactic was simple. He wanted to remove the debate from this place until after Mr Wran's hurried election. The main complaint which the Opposition makes about the Attorney-General is that he has been contemptuous of the Parliament's role, although in the ultimate he admits Parliament has a key role, a role which is unique in this area. The Attorney-General now admits that it is the Parliament-not the Attorney-General, not the Solicitor-General, not some QC advising the Government, not the Prime Minister which carries the responsibility for dealing with allegations of judicial misbehaviour. Yet in the face of that admission by the Attorney-General and in the face of the admission of all of his advisers that that is true, he has consistently refused to give to the Parliament the information which he willingly provided to counsel to advise him on these matters. The counsel whose advice he sought has consistently told him that this is a matter which ultimately rests with the Parliament. That is contained in Mr Temby's opinion. On the second page of the opinion he talks about the fact that this is a matter for Parliament. I will quote him since he has been so heavily relied on by the Attorney-General. Referring to the question of the removal of a judge, he said: That is of course a matter upon which only the Parliament could decide, if it chose to embark upon the exercise. That, of course, is the central point which underpins the Opposition's demand for information in this matter, because this is a matter which only the Parliament can decide. Similarly, the Solicitor-General, Dr Griffith, in his opinion, makes it quite clear that it is the Parliament which has the power to decide these matters, although his opinion seems to raise the suggestion that the Parliament could be brought to book if it exercised that power in a way which some external body thought right. I note that Senator Tate shakes his head , but I note also that Dr Griffith said: Parliament would act beyond the power if it sought to apply wider definition or criteria for misbehaviour than the recognised meaning of misbehaviour not pertaining to the office. The reality of the situation is that which was admitted by the Attorney-General in debate yesterday. Judicial misbehaviour is a matter for the Parliament. Judicial misbehaviour and Parliament's decision on it are matters which are not justiciable. They are beyond the reach of the courts. That was an admission by the Attorney-General yesterday which sits ill with his conduct in this matter. The revelations which face the Attorney-General are revelations on which he has taken some action. When finally the Age took the matters to him and when the Age published those matters, certainly the Attorney-General showed some greater urgency than he appeared to show when Senator Archer raised the matter weeks and weeks before that, towards the close of last year's parliamentary session. We know nothing about the inquiries which were put in train then, except that the Attorney-General says that they were continuing and had been subsumed by the new inquiries. The Attorney sent the matter off to his colleague the Minister for Administrative Services (Mr John Brown), who sent it off to the police. He subsequently sought an opinion from Mr Temby and made material available to him. He then established a task force under Mr Temby as the Special Prosecutor. He subsequently sought an opinion from Dr Griffith. The Opposition wonders why it took the Attorney so long to go to the second law officer of the Crown. He even took it upon himself to visit the judge and to talk to him about the matters which were raised in the tapes. The Opposition is simply not satisfied with various aspects of this matter. It is certainly not satisfied with the personal performance of the Attorney. I am sure that the Attorney will respond in vigorous terms about how proper and how appropriate he has been. We say to the Attorney that he stands to be judged by the very high standards which have been set for Attorneys-General and the high standards which have been quoted in debate in this place. Indeed, I again use the words of Lord Shawcross, which I believe are as good as can be found in explaining what sort of duty lies upon Senator Evans in this matter. Lord Shawcross said, after he had been through a period of great difficulty in a matter of great political difficulty, that he had a duty: . . . to be wholly detached, wholly independent and to accept the implications of an obligation to protect what he conceives to be the public interest whatever the political results may be. That is the standard which is demanded of the Attorney-General. That is one of the bases on which we criticise him today and on which we have criticised him in the past. We do not think that he has shown total detachment, that independence and that desire to protect the public interest whatever the political results may be. The simplest and most recent illustration of that is his pushing back of debate until after the New South Wales election when his political colleague, Mr Wran, has to face his political masters. It would be instructive for Senator Evans to ponder upon the context of Lord Shawcross's remarks because Lord Shawcross was talking about a situation in which he had to take action which was not helpful to members of the government of which he was a part. The words of Lord Shawcross were his affirmation of his prior public duty, even in circumstances where it was to the detriment of certain of his friends and political colleagues. That is the standard we expect of the Attorney-General. We think that it is not the standard we have seen from him. I shall touch very quickly on some of the detail as to why we think the Attorney has shown less than the sort of competence that is required in this matter, quite apart from the issue which has been so much discussed already of his refusal to give Parliament the information it needs. We have questioned publicly whether Mr Temby was the most sensible and desirable person for the Attorney to go to for an opinion. That matter has been the subject of comment outside this chamber and in debate here. The fact is that Mr Temby is the putative Director of Public Prosecutions and he has been given a task in this matter which the Attorney told us will become merged with or be carried on along with that role as the Special Prosecutor. The Attorney has conceded that the statutory duties of a Special Prosecutor and the statutory duties of a Director of Public Prosecutions are not the same and that in particular their relationship to the Attorney-General are not the same. We do not believe it is a wise thing for there to be confusion or any possibility of confusion. We also believe it would have been better had the Attorney-General gone to a lawyer without any political affiliations because that again would have avoided any question of that sort being raised. I believe Mr Temby was asked to give an opinion when he was not given all the information available to the Attorney- General. In particular, it is apparent that he was not given the aide-memoires to advise on following the discussion with the judge. In that and other particulars we believe the Attorney has not handled this matter in a competent way. As far as the task force is concerned, the Attorney-General may well argue that the most adequate way in which to tackle the very many allegations of illegal behaviour contained in the tapes is to establish a task force. The Opposition quarrels with the fact that he has excluded any further examination of the actions of the judge, expressing himself satisfied as to that situation in a public statement with his ministerial colleague. We also question whether a task force is adequate to deal with this matter, given the limited powers of police. I am sure that any senior policeman, when asked, would say that in the sort of task which has been set the police by the Attorney-General in this matter their limited powers will make it difficult for them to get to the truth. An inquiry with the wider powers of a royal commission might have some chance of bringing the people involved to justice. The police will have an extremely difficult task indeed. We have made clear in debate that we are not satisfied with the Griffith opinion and that we disagree with it in some respects. We have made it clear that we do not think the way in which Dr Griffith relied upon the Constitutional Convention debates is appropriate. There has been lengthy quotation from those Convention debates which I believe bears out that Opposition viewpoint. The key point which comes through from the discussion in the Convention debates is that the behaviour of judges cannot be left to the judges, because they themselves are involved. This is a matter for Parliament, and it is the Parliament alone which can settle this matter; and it is the Parliament which has been denied information by this Attorney-General. That view was borne out by a radio interview which the Attorney may not have heard because, having just got out of bed, he may have been under the shower. Professor Lane was interviewed on AM this morning and, when asked how misbehaviour is proved, he said: I suppose the proving would be by Parliament, or at least it would be by a proving which is acceptable to Parliament. Senator Gareth Evans —How much reference to his books do you think he made before he made his contribution? Senator CHANEY —The Attorney is mumbling about how much reference to books there has been. I am saying that there has now been consistent agreement, whether from Professor Lane in the interview this morning, from the Attorney-General in the final stages of the debate last night or from his officers, that this is a matter for this Parliament. Senator Gareth Evans —And from me; never any doubt. Senator CHANEY —It is never in doubt, yet the Attorney-General says that this Parliament cannot be trusted with the information which he made available to his legal advisers to let them make a judgment on the matters which he says are the prerogative of Parliament. It is precisely that sort of ridiculous inconsistency in the Attorney-General's attitude which is the gravamen of our chief complaint against him. We also query the Attorney-General's visit to the judge. He was accompanied by the Secretary to his Department. There is an aide-memoire which he offered late in debate yesterday on the run on the basis that it should be confidential to those to whom it was provided. What a ridiculous offer on the part of the Attorney-General. If he were to provide us with a document which went to the duties that this Parliament has, to say that that document should be denied the Parliament would be to fly in the face of our duty to this place. He knows that the offer was ridiculous and that it was a red herring. I note that he withdrew it this morning. I ask the Attorney: In what role did he go to see the judge? Did he go an an inquisitor, as a policeman, as a colleague, as an associate, as what? Did he warn this man that if he said things that would incriminate him, those things would be used against him? What was the status and basis of this talk? What were the results of the talk? That is something which has been denied to this Parliament. Once again, we have had a failure to meet the standards which are required. We have had speed rather than thoroughness from the Attorney-General. He reminds me of Groucho Marx, who read War and Peace in 10 minutes after a speed reading course. When asked it was all about, he said, 'Russia'. The Attorney-General is a man who read 700 pages of transcript in 20 minutes and then gave this Senate the assurance that we could rely on his opinion. We have had a grudging acknowledgment of the role of Parliament, yet a denial to this Parliament of information which it requires to do its duty. It has been typical of the way in which the Attorney-General has carried on his task. The only way that we will get to the truth in this matter is if there is a genuine inquiry, an inquiry which is independent and which has the power to get to the truth of these matters, because I am sure that under the Attorney-General's administration we are very unlikely to do so. Senator GARETH EVANS(Victoria-Attorney-General)(3.31) —With lawyer-like understatement, to use Senator Chaney's phrase, perhaps I may say that his contribution in opening this debate was one of the most tedious and tendentious bits of sanctimony to pass the lips of anyone in this place within my living memory. It was tedious because, of course, it amounted to nothing more than a repetition of themes that have been flogged literally to death in the last few days and, indeed weeks. The allegations that have been made today are allegations that have been made and answered on numerous previous occasions. Because of the obligations upon me as a member of this chamber, I am obliged to answer them again, and I shall do so with such good grace as I can muster in the circumstances. The Government's response to the allegations as they first appeared in the Age just over a month ago and as they have been repeated in this place has occurred at both an Executive and a parliamentary level. In both of those forums or domains, the response has been appropriate and responsible, for reasons which, once again, I make clear. At an Executive level the sequence of events was very specifically recorded in the very full statement I made to this place on 28 February. When the material was presented to me on 1 and 2 February, I made sure , after consultation with the Special Minister of State (Mr Young) that it was immediately referred to the Australian Federal Police for preliminary investigation and report. When that report came to me and the Special Minister of State 10 days later, roughly on 13 February, the decision was made to seek independent advice from a highly qualified legal practitioner whose independence and integrity as well as competence in these matters would be absolutely beyond doubt. Who better in this respect than Mr Ian Temby, who was our Director of Public Prosecutions-designate, and whose appointment had not been subject to anything other than congratulations by other members of this Parliament at the time it was announced. Mr Temby very rapidly fulfilled the task that was asked of him, focusing, as he was particularly asked to do, on the question of the judge which had given rise to most expressions of public concern and media outrage, whether artificial or otherwise. Mr Temby had available to him all the material that was in the Government's possession. I cannot imagine what Senator Bjelke-Petersen was talking about yesterday when she suggested that five or six of the alleged conversations were not made available to him. I can only think that she was referring to the numbered conversations in the National Times article referred to at one stage, which was reference to summaries that had appeared in the printed material unaccompanied by full transcripts. There were many more than five such alleged conversations having that status. I cannot imagine what else she was referring to. All the material available to us was given to Mr Temby. The aide-memoires of the conversation with the judge in question were not made available to Mr Temby because those conversations had not occurred and were not intended to occur until such time as we had Mr Temby's opinion, because the conversations with the judge, as I indicated very clearly in my original statement in this Parliament, were premised upon me being satisfied that neither the police nor Mr Temby took the view that any such conversation that might then take place with the judge would prejudice any ongoing criminal investigation. So, as a matter of the logical approach to this, it was quite inconceivable that any such reference of material to Mr Temby at that stage would have been appropriate. That is to completely misunderstand the sequence of events and the reasons why things were done, which I have already explained very fully in my parliamentary statement. Now that the further step has been taken following the evident need for further investigation of a number of matters-most obviously, the circumstances of the taping itself, which clearly, on any view, to the extent that this stuff is authentic, was illegal, but also in relation to other possible Federal offences, the general character of which I identified in my statement-now that those matters have been referred to Mr Temby's task force, which he is heading up as independent Special Prosecutor, all the material, including the aide-memoires of the conversation, either has been or will be made available to him to make such use of it as he chooses. There is no question of any denial of this material. I might add, in case anyone is in any doubt about this, that the terms of reference of that task force and that reference to the Special Prosecutor, in which capacity Mr Temby is acting for this purpose, have been made in absolutely general terms, and the language of the reference is, again, incorporated in the text of my statement of 28 February. The other executive action that was taken by the Government was the seeking of a second opinion on the questions of law that were concerned about the proper meaning of 'misbehaviour' and the obligations of this Parliament. That opinion was sought by me from the Solicitor-General as soon as Mr Temby's initial response was to hand, and that opinion of the Solicitor-General has been received and tabled in this place. It speaks for itself as the work of a very distinguished lawyer, one whose distinction was amply recognised by the other side of this place by the frequency with which they briefed him in major cases when they were in government. He is a man whose integrity and competence has also hitherto been unquestioned; but I suppose that he, too, given the standards of morality, political and otherwise, that apply in this place, will be traduced by the general approach to this matter that has now been so amply demonstrated by Opposition spokesmen. There is absolutely nothing the Government's response at an Executive level to this material that has been otherwise than, as I have constantly said, responsible, responsive, proper and prompt. Nothing more could reasonably be asked of any government and nothing more should be reasonably asked of us, even in the overcharged and overheated atmosphere of this nauseously tedious ongoing debate. It appears that the main thrust of the attack today is mounted not so much in respect of the Government's Executive endeavours but, rather, the attitude that we have taken to Parliament's position in this matter and what we have had to say in the parliamentary forum. So let me concentrate yet again on explaining why we have responded as we have in this Parliament. There has certainly been no desire at any stage to remove this debate from the ambit of the parliamentary forum. A very full statement was made on the first sitting day we were back here , on 28 February, and it was a much fuller statement than seemed to have been expected by the Opposition. It was a full statement motivated by our desire to express full respect for the parliamentary institution and its legitimate requests or demands for information from its Executive. It was a full and complete statement and it was made at the first possible opportunity. Senator Durack —It raised more questions than it answered. Senator GARETH EVANS —One of the things that it deliberately tried to do was to answer every question Senator Durack had raised in his rather flatulent series of Press releases in the preceding days. The statement deliberately-not that it would have otherwise not done so-adverted to every one of the matters to do with the handling of the matter that the Leader of the Opposition (Senator Chaney) had called into question and said would be the subject of a strenuous parliamentary attack on the part of his gaggle of troops. Senator Chaney —Tell us about your visit to the judge and the capacity in which you did that. Senator GARETH EVANS —To respond to Senator Chaney's interjection, if there is any feeling that I have omitted to say what I should about the visit to the judge, I say, as I said in my parliamentary statement, that the circumstances were perfectly clear. I have already indicated that that visit was designed to enable the judge in question to have an opportunity to be heard-something that has been demanded in raucous tones and terms by all sorts of people in the context of one other controversial matter within recent memory in the last year. It is a sound principle-that of audi alteram partem-and one that I believe in honouring. I believe it is appropriate, since a judge is involved, that the ministerial head of the department responsible for the Federal judiciary, should have personally accepted the responsibility for having those conversations. The two conversations were conducted at arm's length in the presence of a secretary of my Department. A record of them was kept. The conversations were undertaken for the purpose, I repeat, of enabling the judge to have an opportunity of being presented with the material and making such response to it as he chose both initially and subsequently after he had had a full opportunity to absorb it. Those were the circumstances in which those visits took place. I make no apology for doing it in that way. I equally make clear that I would not have undertaken those visits or had those conversations without first having the clearances to which I referred earlier in this speech. There is nothing more that I can usefully add on that subject. Senator Chaney —Did you just let the judge respond or did you ask questions? Senator GARETH EVANS —I asked a series of questions, as I have made perfectly clear. I said: 'This is the nature of the allegations made. This is this subject , this is another subject, this some other subject. What, if any, response would you care to make to this subject matter?' That is the context in which the conversations took place and that is the context in which the exchanges were recorded. That is the context in which I gave some indication as to the content of those replies and that is the context for which I make no apology whatsoever now nor at any other time. I return to the parliamentary debates in this place. We have indicated, quite apart from my laying down that statement at the first opportunity, a complete willingness to debate this matter at all times that are appropriate and available in the parliamentary calender. We have debated matters of public importance and we have debated the statement. We have debated the statement at rather more extended length than was the subject of agreement from the Leader Opposition before that debate commenced when he said there would be no more than three or four speakers on the Opposition side. Six hours of debate later, he now claims that there has been insufficient debate on the motion to take note of the paper, notwithstanding the numerous other parliamentary opportunities that are, of course, open to him, including this one today, to raise the matter in other ways. We have had some huffing and puffing about the adjournment motion which was moved by the Australian Democrats yesterday and to which I responded by moving that the resumption of the debate be made an order of the day for 25 March, which is in fact a Sunday, as I recalled after sitting down. Nobody expected that debate to be other than wound up at the time that the Democrats leapt to their feet and moved an adjournment motion. Their reason for moving an adjournment motion had, however, been made perfectly clear in the course of the debate; namely, that they regarded it as appropriate that the Parliament look again at this issue, but that it should do so after the hothouse atmosphere of the New South Wales election had exhausted itself. With that in mind and in a way that was entirely consistent with the foreshadowed position of the Democrats , I moved that the adjourned motion be called on again after that election was over. There are ample other opportunities, as we are now witnessing, for this matter to be debated in any way the Opposition chooses. I just note in passing the extraordinary behaviour of the Opposition in the debate yesterday in relation to the question of the aides-memoire. Senator Durack gave notice of a motion today seeking once again the tabling of those aides-memoire. It would seem that he wants to have access to those documents in a way that the Opposition, in voting upon the motion last night, chose not to have. It was perfectly clear from the terms of the motion last night that the Opposition would have had the support of the Australian Democrats in seeking from the Government if not the transcripts in the terms in which it wanted them, certainly the aides-memoire in the terms that it wanted them. What kind of extraordinary, nonsensical hypocrisy we are confronted with today, with a further moving of that motion and a desire, I expect, to have that motion brought on again urgently for debate, I can hardly bring myself to say. That kind of nonsense when the Opposition made an utter mess of its tactics and strategy last night when it had the opportunity available to it, to have to put up with the sort of lumbering rearguard action with which we are now confronted, beggars and staggers the description. I suggest to Senator Withers, who as usual is leering on the halfway to the back benches, that once again there has been ample demonstration of the absence of any kind of credible tactical leadership in the Opposition party which he continues to grace. As to the responsibility of this Parliament in relation to the documents as they concern the judge in particular let me come yet again to the essence of the Government's position in this respect. Of course it is the case that we do not and never have denied the primacy of the role of parliament so far as determining questions of judicial behaviour is concerned. For Senator Chaney to say that I now am accepting this view or am now admitting this, that, or the other about it, is to totally overlook the fact that I have never said anything other than that under the Constitution Parliament has this role. It may be that there are some exceptional circumstances in which the judiciary would claim some residual supervisory role but, putting that to one side, it is clear that Parliament is the body that has the primary determining role in this respect under the terms of the Constitution. But that is a role which must be looked at in the context of this case and in the context of what is being claimed about this case. The role of the Parliament, as I said yesterday, is a very limited one so far as the judiciary is concerned. The principles espoused by the founding fathers, the principles inherent in the very text of the Constitution, make it clear that there must be respect for the concept of the separation of powers and the absolute independence of the judiciary from malicious or half-baked attacks upon it by the Parliament if our Constitution and the Federal system it embodies with the position of the judiciary as the referees of that system is to survive. That principle was articulated over and over again by the founding fathers, and it is perfectly clear that that is the case so far as the proper construction of the constitution is concerned. The only role of this Parliament is not to criticise and generally censure the judiciary or individual members of it in a way that is perfectly appropriate for this body to do regarding the Executive; the only proper role for the Parliament, apart, of course from larger questions of public policy as to the merits or otherwise of particular judgments and the approach of the judiciary to solving particular problems of law which are always a proper subject for public debate, when one is talking about the propriety of the behaviour of judges and whether they are fit and proper persons to stay on the bench, is and must be the narrow one of determining whether there has been misbehaviour within the strict meaning of that expression as it occurs. For all the reasons that I articulated yesterday, that is a narrow concept. It extends to either of two situations: First, the performance of the judge in his judicial capacity, in the conduct of his judicial office, and, secondly, the commission of offences by the judge in question which are unrelated to his judicial office but which are of a character which is incompatible with his continued occupancy of the bench. That is where it begins and ends. The law, the practice and the principles in Australia are quite different from those that obtain in the United Kingdom. The roles of our respective parliaments are very different in this respect. The second point that I make relates to the further argument that will be put to me, namely: If that is so why is it nonetheless inappropriate for the Parliament itself to look at all the material, pass upon it and determine whether there may have been misbehaviour of the kind in question here. Why should the Parliament be asked to rely simply on the views of the police, the views of the Special Prosecutor, however distinguished, or indeed the views of the executive government of the day? This Parliament is being asked to exercise this self-restraint by me and by the government of the day-it is not being told that it cannot do it but it is being told that it should not do it-because of the particular circumstances of this material. To repeat what I have said a thousand times and what we all know to be the case, it is utterly unauthenticated material, as to the whole of it or any part of it. No concession has been made as to the accuracy of it, no admission has been made by anyone in a position to make any such admission and it is simply unauthenticated. Moreover , if it is authentic and turns out to be such it was clearly obtained in circumstances of manifest and spectacular illegality. Thirdly, not only is it unauthenticated and manifestly illegally obtained, but also it is a gross invasion of the personal privacy of lots of individuals. Under those circumstances and given the significance of the course of events that would follow were Parliament to insist upon having this material in the public domain, I believe it is appropriate for Parliament to accept the assurances that have been given by everyone-that whatever else this material might contain and whatever other judgments one might be minded to make about indiscretions or otherwise, if the authenticity of this material could be established it does not establish anything that could possibly give rise to allegations of misbehaviour within the meaning of the Constitution. It does not point to or establish criminal conduct. It does not go in any way to the conduct of the judge in his judicial office. As such it is not appropriate for Parliament to do this. Were Parliament to insist upon having this material put out for all the world's salacious spectators to see we would be creating a precedent which we would long live to regret. All of us receive letters from time to time urging the most extraordinary misbehaviour on the part of individual judges, usually from aggrieved litigants. All sorts of scuttlebut and gossip is bandied about, particularly in the hot house atmosphere of election campaigns. It is quite inappropriate, simply because an allegation of this kind is made, to demand that this sort of material, in all its sordid quality, be laid out. There are occasions when it is appropriate for Parliament, on the basis of the circumstances I have outlined, simply to take some things on trust. Common decency so demands. Senator DURACK(Western Australia)(3.54) —I support the matter of public importance raised by Senator Chaney which is: The failure of the Attorney-General to respect the role of the Parliament and to respond properly to the issues raised by the Age tapes. The Attorney-General (Senator Gareth Evans), in answering the well reasoned case very calmly and rationally put forward by the Leader of the Opposition (Senator Chaney), trotted out his usual abusive epithets about the behaviour of everybody on this side of the chamber. He accused Senator Chaney of being tedious, tendentious and sanctimonious. We have tediously heard these words from Senator Evans over and again. I got so sick of hearing this word 'tendentious' being applied to almost everybody and everything that is said in this place that I decided to find out what in the devil the word meant. I had not taken any notice of it before. In fact I have not taken too much notice of the Attorney-General in recent days because of the manner in which he has been conducting himself. The Oxford Dictionary defines 'tendentious' as 'having an underlying purpose, calculated to advance a cause'. I suddenly found that what I thought was constant abuse of us by the Attorney-General when he accuses us of being ' tendentious' was only praise for us doing our job. Clearly, advancing a cause is what we are all here for. The Attorney-General was quite correct in categorising what Senator Chaney said as 'tendentious' because it certainly was advancing a very good cause and it had a very strong underlying purpose: To reveal the attitude of the Attorney-General and the cover-up of this whole matter in which he seems to have been engaged ever since it hit his desk. The Attorney-General has said that the way in which he has handled this matter from go to whoa has been perfectly appropriate. Indeed, he has answered the sorts of criticisms that were being levelled at him by me before this Parliament sat by saying that I gave him a list of interrogatories. He thinks there must be some exhaustive list of interrogatories that he has to answer. No such thing can be assumed from the questions I asked. I believe that there are some very serious questions to be asked about and criticisms levelled at the way in which the Attorney-General has handled this matter. I agree that in the first place he took the appropriate step in referring the matter to a police task force to get expert advice from expert investigators. At that point I did not criticise what the Attorney-General did although I was asked by the media and almost invited to do so on several occasions. But where the Attorney-General went wrong was the way in which he handled the matter from the time the police report was received by him. He was not under any great pressure at that stage from me or anybody else to rush along with this matter in the way in which he did although clearly he had to have an appropriate response for this Parliament and he got it. I remind the Senate that these matters first came to his table on, I think, 1 February or 2 February. Parliament did not sit until 28 February. On 13 February he got the police report and that was the point at which he really panicked about this whole matter. It was quite clear, having got the police report, that it was not something that he could brush off by saying that he gets frequent complaints from people, allegations about misconduct by judges and so on which really one cannot take notice of. Here was something that he had to take notice of. What did he do? He gave the job to Mr Temby who was then the Director of Public Prosecutions-designate. Mr Temby had just been appointed to that job. He was to take up that appointment on 5 March. Mr Temby's qualifications for the position of Director of Public Prosecutions have not been challenged by the Opposition and are not being challenged by the Opposition. But- Senator Gareth Evans —But what? Senator DURACK —But I do challenge his standing as a constitutional lawyer. That is one of the points I made. In a matter of this kind the Attorney-General should have got the opinion of the Solicitor-General or some other constitutional lawyer of that standing from the word go. Senator Gareth Evans —That is exactly what I did. Senator DURACK —The Attorney-General said that he did not seek his opinion until , I think, 17 or 18 February. The Attorney-General turned to the man who was being appointed Director of Public Prosecutions. This was a major new challenge and responsibility for Mr Temby and for the Government. He had to take up that position on 5 March and establish himself in that role in Canberra. Yet he was diverted from that role by this proposal that he should be appointed Special Prosecutor to oversee this task force. That is another criticism that has been made of the Attorney's handling of this matter. But the most extraordinary thing about Mr Temby's appointment or involvement in this matter is that he was given the task on 13 February. Apparently the Acting Crown Solicitor took all the 524 pages of transcript, plus the tapes, to Perth on 13 February. Mr Temby gave his opinion to the Attorney-General-the opinion we now have-on 15 February. As Senator Sir John Carrick has pointed out, 524 pages of transcript, even if it were read at speed, would have taken Mr Temby 17 hours simply to read, much less to digest it, consider it and look up the law about misbehaviour and whatever. An incredibly rushed job was expected of Mr Temby. I believe, and I am sorry to say so, the opinion bears the hallmarks of a rush job . That is no reflection on Mr Temby's competence as a lawyer; it is a reflection of the Attorney-General's pressure on him to give this opinion under this sort of time limit, which is really quite ridiculous. Mr Temby's opinion was obtained in order that the Attorney-General and the Special Minister of State (Mr Young) could give a statement on 17 February. I wonder why there was pressure to do it on 17 February? I wonder whether it has anything to do with the by-elections that were about to take place on 18 February? I cannot see what other pressure there was. Parliament was not sitting until 28 February and I was not pressing the Attorney-General. I had not said anything up to that stage about what had happened. Senator Evans had to rush in and get this whole matter out, appoint Mr Temby as the Special Prosecutor, set up this task force and so on. The next day, after I had drawn his attention to the inadequacy of his statement on 17 February-the fact that he had relied on Mr Temby and Mr Temby alone for giving an opinion on judicial misbehaviour-and said that he ought to have another opinion, the Attorney-General turned to the Solicitor-General, who was given a bit better treatment than Mr Temby because he was given a week to provide us with his opinion. For reasons that have already been given in this Parliament, again without any reflection on the standing of Dr Griffith or his competence as a constitutional lawyer, we have been critical of aspects of that opinion and will continue to be so. Indeed, the Attorney- General and Senator Tate, by their admissions in this chamber yesterday about the primacy of Parliament's role in this matter, have also qualified the opinion of the Solicitor-General. Let me refer to an aspect of the opinion which was put down by the Attorney-General with his statement on 28 February, last week. Dr Griffith, on page 13 of his opinion, states: Parliament is not at large to define proved misbehaviour by reference to its own standards or views of suitability for office or moral or social character or conduct. The Parliamentary enquiry is whether commission of an offence of the requisite quality and seriousness is proved. That is a very clear warning off of the Parliament by Dr Griffith. That, coupled with what the Attorney-General put into his statement about the interface between the Parliament and the judiciary and the warning again about how Parliament had to be so careful in these matters and so on, indicated an attitude which is quite different from the one which the Attorney-General is now saying he has always espoused. Only yesterday it became clear that he recognised the primacy of Parliament, but he recognised the primacy of Parliament only in a theoretical sense because he will not give the Parliament-that was made clear by his vote and speech yesterday-the material on which it can exercise that primacy role which he says he recognises. The Attorney-General says he has made a full statement to the Parliament and that he has been willing to debate it. He says that he has even been prepared to take part in the discussion of matters of public importance. Is that not a magnificent gesture by the Attorney-General to this Parliament to say that when a matter of public importance is raised he is prepared to debate it? How thankful and how honoured we should be about the attitude of the Attorney- General to this Parliament! Senator Chipp —Do you think he is being tendentious? Senator DURACK —He is certainly being sanctimonious. Really the attitude expressed is quite offensive. He was repeating again today that Parliament is confined to a narrow role. Parliament's role, as our founding fathers made quite clear in the convention debates, is a very wide role indeed. One cannot spell out of the intention of the founding fathers who took part in these debates any very narrow definition of misbehaviour to which the Solicitor-General has tried to confine us. Let me give an example: Is the Attorney-General saying that if there were some serious misconduct by a judge-conduct which has been traditionally accepted as being contrary to the standards of judicial behaviour, even if it is not on the Bench or even if it is not a criminal offence-which does affront the people's perception- Senator Gareth Evans —Like what? Senator DURACK —Such as a problem which has occurred very often in the United Kingdom, remarkably often. If Senator Evans had only read Shetreet, instead of pouring scorn on it as he did yesterday, he might have been enlightened by it. There has been a number of cases in the United Kingdom where judges have been invited to serve-and have accepted-on a committee of a political character. If a judge in this country accepted an invitation by a political party to serve on a committee, even in an advisory capacity, would it not be the responsibility and the right of Parliament to express a view about that sort of conduct of the judge? Senator Gareth Evans —To drum him out of office? Senator DURACK —Not necessarily to drum him out of office. If Senator Evans had only studied Shetreet, instead of adopting the scornful attitude to it which he expressed yesterday, he would see that these problems have arisen time and again in the House of Commons. There have not been motions to remove judges but there has been debate and views have been very strongly expressed by some very leading figures in Britain over 100 years or more. I quoted Sir Winston Churchill yesterday. I can give many other examples of leading British politicians and statesmen commenting on the conduct of judges. This is a perfectly right and proper role for Parliament to pursue even if it did not proceed to seek the removal of the judge in the particular circumstances, but simply admonished the judge. In many cases of this kind the judge has modified or changed his conduct, resigned from a committee or whatever. That is a perfectly proper role for the Parliament, but Senator Evans will deny that if he is consistent in what he has been saying. I think he might ponder on it and maybe we will have another admission from him the next time we come back to this matter, which I am sure we will have to do because the matter is by no means resolved. The Senate must continue to consider and debate this very serious issue of the way the Attorney- General has handled at all times and continues to handle this matter of the Age tapes. Senator TATE(Tasmania)(4.07) —The Opposition has asserted, by way of raising a matter of public importance, that the Attorney-General (Senator Gareth Evans) has failed to respect the role of the Parliament and to respond properly to the issues raised by the 'Age' tapes. It seems to me that the Opposition has utterly failed in its attack on the Attorney-General. It is interesting that it has mounted its attack by way of raising a matter of public importance rather than a censure motion or any other means which would bring the matter to a vote in this chamber. It is quite clear from the paucity of the evidence brought forward this afternoon that members of the Opposition could not persuade a majority in this Senate chamber to vote in a way which would censure the Attorney-General if the claim is that he has failed to respect the role of the Parliament. It seems to me that the role of the Parliament can be thought of in two different aspects; it is a two-fold role in relation to these matters. Firstly, there is the general role of the Parliament, which simply derives from the fact that we live in a democracy where responsible government is enshrined in our institutions, where the Ministry is drawn from and is responsible to the Parliament and has to answer to the Parliament for its actions. If the Attorney-General had, at any stage, tried to evade the consequences of living within that democratic institution where responsible government is the norm, if he had tried to evade answering this Parliament and bringing before the Parliament the information which it properly seeks to put his actions in this respect under scrutiny, there may be some substance in the matter of public importance. Of course, it is utterly the case that the Attorney-General has exposed all his actions to scrutiny without being forced to do so by some draconian exercise of power by this chamber. He has done so quite freely and of his own will by way of statement, by way of response during Question Time and on other appropriate occasions within this chamber. As evidence of that point, one needs only to look at the ministerial statement by the Attorney-General which is dated 28 February 1984, the day on which this Parliament resumed. So at the first possible opportunity, on the day on which this Parliament reconvened, the Minister responsible for this matter, the Attorney-General, laid on the table in this chamber a ministerial statement which gives the fullest possible run down, explanation and catalogue of the events which followed his receipt of the tapes on 1 and 2 February 1984. What is so galling to the Opposition is that when one reads the ministerial statement, one finds evidence only of a prompt and proper handling of the matter by the Attorney-General. I say 'prompt' because there is nothing which the Opposition has been able to bring forward which suggests any impeding, frustrating or slowing down of investigations into this material by the Attorney -General. On the contrary, he reacted in a very timely, speedy fashion to the presentation of the material by the Age. Further, there can be no suggestion, when this matter is exposed-as it has been in the ministerial statement, supplemented by answers supplied during Question Time and so on-of any attempt by the Attorney to circumscribe, restrict or somehow narrow the terms of reference either for the investigation carried out by the Australian Federal Police at the behest of the Special Minister of State (Mr Young) after he was informed of these matters by the Attorney, or any attempt to restrict the terms of reference in seeking an opinion from Mr Temby. We had a speedy response, a response which, as I say, contains no element of trying by those into whose hands the matters to circumscribe, restrict or close off certain lines of inquiry were placed. What is more, they were quite clearly placed in the proper hands. They were initially placed in the hands of the Australian Federal Police and in the hands of Mr Temby, QC, for an opinion. There is no doubt, of course, of the status of Mr Temby, QC. In order to balance some of the matters which have been put by Senator Durack at their most basic, that Mr Temby may have lacked competence or stamina, the fact is that Mr Temby was President of the Law Council of Australia and he is the Director of Public Prosecutions designate. I am sure that, had it not been for this occasion , Senator Durack would have issued Press statements applauding the appointment of Mr Temby as DPP designate and no doubt would have commented on his general fitness, ability, integrity and his high standing with his peers, as shown by his being President of the Law Council of Australia. The matter was put in his hands and I believe he discharged his task, arduous as it no doubt was, with absolute integrity. The real problem is that what emerged from the opinions of both Mr Temby and Dr Griffith fails to support what the Opposition wants to do. That is really what it is concerned about. The second role of the Parliament which the Attorney may have failed to respect sufficiently is in relation to its ultimate role as guardian of the integrity of the Federal judiciary. Once again, I believe the Attorney has discharged his duties very properly in relation to that ultimate role. It is not true that some sort of admission was dragged out of the Attorney-or out of myself, for that matter-to the effect that the Parliament is the ultimate arbiter of these matters. There was a simple recognition by the Attorney that that is the case. Senator Durack —When did he say that in his statement? Senator TATE —He said it yesterday. Senator Durack —But when did he say that in his statement? Senator TATE —He did not need to say that in his statement because it was assumed. There was no difficulty in his making that statement which acknowledges the situation that in relation to these matters the Parliament is supreme and the matters that arise under section 72 of the Constitution, for example, are not justiciable. Senator Evans put to one side an extreme case in which some sectarian bias was exhibited by the Parliament in getting rid of judges who did not share a particular religious or some other outlook. He thought there may be a case for intervention by a bench in that extreme set of circumstances. I do not necessarily share that view. I would have thought that electoral repercussions, rebuke and reprimand, would have followed, and in any case are sufficient and proper. I believe that what goes on within the walls of this Parliament, including this chamber, in relation to section 72 are not justiciable. As I said, this was stated and acknowledged by the Attorney-General as a general principle and in no way was an admission dragged from him. There was a respect for and an acknowledgment of the role of this Parliament in this matter. Having acknowledged that the total responsibility, unreviewable by the courts lies with this chamber, having acknowledged that the responsibility fairly and squarely lies within the Parliament and nowhere else, the Attorney then sought to aid this chamber by the provision of certain legal opinions. I believe he was acting utterly properly and in the way which Senator Chaney indicated was in the English tradition; namely, that the Attorney must set himself apart from his particular political allegiance and set before the Parliament those legal opinions which are necessary to enable the Parliament to come to a proper judgment in any matter. I noted that Senator Chaney quoted Lord Shawcross, who said, in effect, that there is an obligation to protect the public interest, whatever the political results may be. That responsibility, I believe, was well discharged by the Attorney-General who, on 28 February, the first day of the parliamentary session, laid two opinions before us. He was not content with the view of the law taken by Mr Temby, QC, as the basis for his assessment of the material from the Age which had been forwarded to him. He went further than that , despite Mr Temby's eminent qualifications, and sought an opinion from the Solicitor-General. The Solicitor-General was asked, as I understand it, for a simple or purely legal opinion without it being coloured or in any way influenced by any forwarding of the material that the Age had given to the Attorney-General. The Attorney had no way of knowing what legal opinion the Solicitor-General, Dr Griffith, may have forwarded to him. He was not able to control the outcome of that application of an eminent legal mind to the problem with which he was confronted. Yet the Attorney, as I say, laid before us the two opinions, indicating that he had read them and concurred with them. Having come to a certain understanding of them, he concurred with them. The problem for the Opposition is simply that it does not agree with those opinions. But that is not the same as saying that the Attorney-General has not discharged his responsibilities towards this chamber. He has brought those opinions into the chamber and indicated his understanding of them and his concurrence with them. It is open to this chamber to reject those opinions of eminent lawyers. It is open to the chamber to reject the Attorney-General's understanding of those opinions or his adopting of them or concurring with them. I say that it is not open to the chamber to say to the Attorney-General that he failed to lay those opinions before us, that he failed to give his opinion to us , as he is required to do by the English tradition which says that without regard to the political results he must put forward the public interest by making legal opinions available to this Parliament without fear or favour. I believe that that is what he has done. I believe that that distinction is clear. It is unfortunate that the Opposition will not accept that its disappointment in those opinions should not carry over to a charge that the Attorney-General has acted improperly in seeking them and bringing them before us. The problem with those opinions is that they do not support the view of the Opposition that this Parliament is some sort of general censor of the conduct of judges holding Federal office in Australia in the way that the Parliament of Westminster, in relation to the judges of England and Wales, admittedly is. The fact is that those opinions reveal that the framers of the Constitution put a restriction, restraint, on the Parliament, so that if it is to look at the behaviour of judges it is to do so in the context of section 72, praying for removal. Senator Durack —Who is going to be a censor of judges' conduct? Senator TATE —As I understood it, Senator Durack was saying that that was an option, apart from the praying for removal procedure set out in section 72. He was relying on the English tradition for that. I am saying that the opinions do not bear out Senator Durack in this regard. Let us assume for the moment that those opinions are wrong; nevertheless, the Opposition cannot claim that the Attorney has not acted entirely properly in seeking those opinions and bringing them into this chamber. Senator Durack —What I am asking is that: On that basis, who is going to judge the judges? Senator Robertson —Mr Acting Deputy President, I rise on a point of order. It is very difficult to present a case on this side of the chamber with these continual interruptions. The ACTING DEPUTY PRESIDENT(Senator Elstob) —Order! There is no point of order. Senator TATE —In relation to that general conduct which does not fall within the three categories of misbehaviour, which are conveniently summarised as improper exercise of judicial functions, wilful neglect of duty or non-attendance, or conviction for any infamous offence, then the matter has to be dealt with by extra-parliamentary surveillance and dealing with the judge concerned. In other words, I imagine this would be done by his peers on the Bench. That is a restraint, which the Opposition may not like, by which it is unusually and extraordinarily the case that the Australian Parliament is restricted because of the Federal nature of the Constitution and the need to keep the Federal judiciary independent of the sorts of attacks which could be mounted upon any judge from the privileged chambers of this Parliament. The fact is that this whole exercise is premised on the bad faith of the Attorney-General. It is the same sort of prejudice which led Senator Durack and Senator Chipp to claim earlier in this matter that the Attorney had restricted the terms of reference of the Federal police or Mr Temby to the question of the provenance of these materials rather than their substance. That was never true. It is that same incapacity to accept the good faith of the Attorney-General which really underlies this matter of public importance. That particular prejudice and that inability to accept the good faith of the Attorney I think does no credit to the Opposition and is refuted by the facts. Therefore this matter of public importance I believe should receive no accord within this chamber. Senator LEWIS(Victoria)(4.23) —The Senate is debating as a matter of public importance the failure of the Attorney-General (Senator Gareth Evans) to respect the role of the Parliament and to respond properly to the issues raised by the Age tapes. Before I turn to presentation of my case in relation to that matter, I would like to congratulate Senator Tate, notwithstanding the implied criticism of his own Whip, on his valiant attempt to present a case in defence of the Attorney-General. It is quite understandable why most members of the Australian Labor Party now believe that Senator Tate should replace Senator Evans as the Attorney-General. He is clearly much more rational and restrained and he is not continuing to embarrass this Government, as Mr Kitney said over the weekend, by turning difficulties into catastrophies. If Senator Tate would take a little advice from me, I suggest that he should see Senator Richardson and talk to him about joining the correct faction. Then no doubt the Prime Minister (Mr Hawke) will be on his way to the Press Club to make the necessary changes. Section 72 of the Constitution provides that a judge of a Federal Court: Shall not be removed except by the Governor-General in Council, on an address from both Houses of the Parliament in the same session, praying for such removal on the ground of proved misbehaviour or incapacity. It appears that Senator Tate has finally managed to convince the Attorney- General who, as at yesterday, appears to acknowledge that this means proof to the satisfaction of both Houses of the Parliament. The Parliament then has to consider whether it is prepared to make such a prayer. I add that the Attorney- General seems to have ignored totally the other question raised in that section of the Constitution: What would happen if both Houses of Parliament did make such a prayer? That raises the question of whether the Governor-General in Council would be obligated to act on that prayer or whether the Governor-General in Council might be able to refuse to act on that prayer. In any event the Attorney-General apparently now accepts that it is a matter for the Parliament to decide whether there is proven misbehaviour or incapacity. It quite fascinates me to discover that, despite all the debate in this place, the media still has not grasped the simple point that the Attorney-General is endeavouring to circumvent consideration by the Parliament of the material which would enable the Parliament to satisfy itself one way or the other. How is the Attorney-General endeavouring to circumvent the consideration of this matter? He is doing so simply by producing the opinion of a learned lawyer, Mr Temby, which in effect says: 'I have read the material, I have heard the tapes, I have considered the matter, and I believe that there is no evidence of misbehaviour.' The Attorney-General put to the Parliament that it should accept that statement and not bother to consider the material any further. I might say that Mr Temby makes it perfectly clear that the judge's behaviour is questionable. However, the whole point about this is that the Attorney-General is denying the Parliament the right to examine the material, even in a sanitised form. We are not going to be given the opportunity of considering this matter and making up our minds, as the Constitution requires us to do. I have asked the Attorney-General by way of interjections how it is that we should make up our minds on this matter. What we are supposed to do? Are we supposed to sit down and read newspaper reports of the matter? Clearly we are not going to be provided with the actual material. Clearly we will be provided with nothing except an opinion; we ought not to apply our minds to the material to which Mr Temby has been able to apply his mind. No parliament worthy of its name would accept that. That is usurping our role. Certainly the Senate, as one of the greatest Houses of Parliament in the whole of the Westminster system, would not accept such a proposition. This Senate has demanded the right to consider the material, and I am sure that in due course, after the election in New South Wales, that will then happen. Of course, the Attorney-General gave himself away yesterday when he moved that the motion requiring him to table the material be adjourned until after 25 March. Why did he move that motion? He did it because there will be an election in New South Wales on 25 March. Clearly, there is something in that material which has nothing whatsoever to do with the judge but which vitally concerns the people of New South Wales. It is clear, is it not, that after 25 March the Attorney-General will have no care for the judge , whom he will proceed to pour down the drain as quickly as he has poured other of his colleagues down the drain. I ask the Senate to consider what would be its attitude if Mr Temby had come up with a statement to the effect that he had considered the evidence and his opinion was the reverse. In other words what would be the Senate's attitude if Mr Temby had said: 'I find on the basis of the material that the judge is guilty of misbehaviour. Therefore the Parliament should pray for his removal'? What would have happened? Would the Senate have accepted that opinion without looking at the material? Of course not. The Senate would have demanded to see the material so that it could make up its own mind as to what it wanted to do. It is absolute nonsense for the Attorney-General to circumvent the Parliament in this way. The matter of public importance before the Senate today is critical of the Attorney-General because of his actions. The first one is the denial to the Parliament of the right to consider the material and the second is the refusal of the Attorney-General to supply the Parliament with details of his interview with the judge. The Opposition has asked him a whole series of questions about that matter. Initially he indicated to us that he would supply us with information because after all, that cannot be subject to some sort of protection . The Attorney-General, the first law officer of the Commonwealth and a senator in his own right, spoke to the judge. We have asked him questions about the conversations which he had with the judge. But of course the Attorney-General, with all his usual manoeuvring, has endeavoured to avoid the important questions which we have been putting to him. I ask him: What was the nature of his call on the judge? Was it an informal or a formal call? Was it made on the basis of an old boy, in-club discussion? If so, why was it necessary to have Mr Brazil accompany him? Has the Attorney-General considered what problems that created for Mr Brazil? What would have happened if, in the course of that discussion, the judge had conceded that he was involved in some sort of conspiracy? Where would that have placed the Attorney-General? Where would that have placed Mr Brazil? The Attorney-General has now refused to table the aide-memoire which Mr Brazil made as a result of those conversations. I ask the Attorney-General: Did he warn the judge that any statements he might make may be used in evidence against the judge or in any proceedings? After all, if the task force interviews the solicitor and the solicitor says 'Yes, the judge and I were involved in a conspiracy to bribe a Commonwealth officer' and as a result the task force decides to prosecute the solicitor and the judge, of course the link connecting the judge with the solicitor will be the evidence of the Attorney-General, Senator Gareth Evans. I ask the Attorney: Has he given any consideration to those problems? In other words I am asking the Attorney-General: On sober reflection of his actions, does he now consider that it might have been wiser not to have interviewed the judge but rather to have conducted his interviews by correspondence so that there would have been a written record as to precisely what was said, by whom, and what was meant. I have not the slightest doubt that the judge believes that it would have been wiser for the Attorney-General not to have interviewed him. I understand that that is the judge's main complaint to his colleagues-that what he is really concerned about is the Attorney-General. I turn to the procedure which should have been adopted by the Attorney-General in this matter. The Attorney-General had an obligation. As Lord Shawcross has said, the obligation is to act without fear or favour. Lord Shawcross's precise words were: . . . it was the duty (however personally unpleasant of His Majesty's Attorney- General to represent the public interest with complete objectivity and detachment, and that to refuse to discharge that duty in a particular case in which the public interest might be suspected to conflict with the interests of certain of his friends or of his political colleagues would be tantamount to saying that the office itself was inadequate to represent and protect the public interest against whosoever might challenge it. With that in mind, a proper Attorney-General acting properly, in accordance with the obligations of an Attorney-General of the Commonwealth would have put the material, perhaps in a sanitised form, before the Parliament. He also, of course , would have put legal opinions with that material. He might then have argued the reasons why the Parliament should not pray for the removal of the judge. He might have argued that with all of the strength that an Attorney-General is entitled to argue that case. He would then have been allowing that decision to be made by the Parliament. He would not have been doing what he has endeavoured to do-circumvent the role of the Parliament by telling us that we do not have to consider the material; all we have to do is consider the opinion of Mr Temby and the other people he has put before us and that we should accept their decisions on the matter. That is not a role which this Senate will allow to happen to it. This Senate will refuse to allow the Attorney-General and his advisers to usurp its role. Finally, I refer to the Attorney-General's response to Senator Chaney earlier today. To use his own words, the Attorney was 'tedious and sanctmonious.' He sounded very much to me like a naughty boy attempting to explain the unexplainable to a headmaster. But the Attorney-General, with his usual hypocrisy, excused his own actions for a series of reasons all of which he acknowledges will become insignificant after the New South Wales election on 24 March. That is what this debate is all about. I ask the Senate to support the matter of public importance criticising and condemning the Attorney-General. Senator ROBERT RAY(Victoria)(4.37) —I am sure that tonight the boys at 234 George Street, Sydney, will be disappointed because the backroom boys who are planning the New South Wales State election campaign would have hoped that today their big brothers in Federal Parliament could provide them with at least an element that they could go on in the New South Wales campaign. People here are lucky that there is an industrial dispute and the Hansard will not get to New South Wales for weeks. The Opposition will be bitterly disappointed because it will probably get no coverage in the Press; this debate will make no splash at all. The Opposition's performance today has been nothing short of pathetic. It has been very lay-back, very low profile and absolutely abysmal. I will start with Senator Chaney. Apart from picking up the Notice Paper five or six times and throwing it down rather majestically, most of his points were completely invalid. First of all he quoted from a letter by a Dr Spry to the Age. He later questioned Mr Temby's qualifications. Dr Spry always takes a conservative line. As the honourable senator knows he always supports the Liberal Party of Australia. So what an impeccable source he is! Senator Chaney —Is that how you label your lawyers? Senator ROBERT RAY —I am just about to come to that. The Government has not commissioned Dr Spry-neither has the Opposition ever commissioned him-to put forward an opinion. If, as a government, the Opposition had commissioned Dr Spry I would respect his opinion because he is probably a person of integrity. He is probably not putting his political views first but the honourable senator would find that hard to understand. When the former Government appointed Mr Costigan to the Royal Commission on the Activities of the Federated Ship Painters and Dockers Union, Mr Costigan was a member of the Australian Labor Party. Did the former Government ask him about his integrity? When Mr Barwick went to the High Court of Australia did the Opposition immediately assume that his integrity had to be in question at the time? Of course not. However, because Mr Temby has some connection with the Labor Party-I believe he ran as a candidate against Mr Court 's son; he is a friend of Senator Chaney's-- Senator Crichton-Browne —I think he is on the State Executive. Senator ROBERT RAY —I think he may be. But is Senator Chaney saying that Mr Temby has no integrity in his profession? Is he saying that Mr Temby is biased? That is what he implied here today. Senator Chaney —Rubbish! Senator ROBERT RAY —Senator Chaney should go back and read his speech; he will find that that is what he implied. Senator Chaney appealed to the jury of public opinion in this place. Does Senator Chaney really believe that it is the jury of public opinion that makes a decision on this matter? I have never heard a more ridiculous concept. The honourable senator said that independent journalists had raw material and asked if one could possibly doubt them. The honourable senator must know what the insurance bill is for newspapers for defamation. Journalists are not always right. They are not infallible. They could be wrong in this case. So let not the honourable senator come into this chamber and quote them saying: 'Independent journalists have written this, so ipso facto everything there has to be true'. Senator Chaney said that his main complaint was that the Attorney-General was contemptuous of the parliament's role. I think that is quite good coming from the other side, considering how that side has debased democracy in this country, especially if one goes back to 1975 when a lot of pompous hypocrisy came from that side about how glorious is the role of parliament. One only ever hears this from Opposition senators when they are in opposition. When they are on this side they could not care less about it. They invoke freedom of information when sitting on the Opposition side but when they were sitting on the government side they did absolutely everything they could to block it. Freedom of information does not mean that every bit of information which is received by a government should be available to everyone. Surely honourable senators opposite would concede that certain information and discussions which Ministers have are internal to the government are not suitable for publication. If one were to make everything that a government said and did available for publication everything it did would be restricted and ineffective. Finally, Senator Chaney accused Senator Evans of being like Groucho Marx. I take that as a compliment to Senator Evans. At least Groucho Marx had a successful career spanning four decades. Senator Chaney reminds me of Zeppo Marx who lasted two years and disappeared. The curtain came down on his career and that was it. One of the other contributions made by the Liberals here today was that of Senator Durack who again reinforced the fact that Mr Temby's view is probably not the best sort of view. He does not agree with it. That is typical of the Liberal Party, especially of the lawyers opposite. If they get an illegal opinion they agree with it; it is fine. If they disagree with it it is just to be thrown out. But Senator Lewis really let the cat out of the bag, did he not, when he complained about Senator Evans putting off the debate until 25 March? I would have thought that Senator Evans's actions came as a result of the challenge by the Australian Democrats, who said that they wanted to raise this question after the New South Wales State election. We have only another two days of sitting. We all know that the matter was not to be debated again in the next two days and Senator Evans responded in that way . But it certainly peeved Senator Lewis because the whole motivation of the Opposition in this matter is to bring up issues to try to help the boys-and girls, I should add-in New South Wales in the New South Wales State election. And boy, do they need some help. There are 13 Liberals in the Lower House in the New South Wales Parliament-the equivalent to a rugby league side. The real trouble however is that the Liberal Party has no front-rowers, no wingers and no five-eighths. They have only 13 orange boys. They are out of their league so they have to call in help from honourable senators opposite to try to win them an election. The Liberal Party has probably very little chance of winning the election because it has no issues to go on other than some nebulous claims and assertions, the sort of thing with which Senator Baume disgraced himself in this place yesterday. He read out a whole list of allegations irrespective of the fact that many of them had been answered already by inquiries and by courts. Nevertheless, the allegations were repeated here, allegations which harm innocent people. No one is arguing here that there is absolutely no corruption anywhere within Australia. Senator Chaney —That is big of you; very big. Senator ROBERT RAY —I thank Senator Chaney. No one is arguing that. If we had to argue that Australia was riddled with a certain amount of corruption we would have to ask members of the Opposition, who were in government for seven years, what they did about it if they believed that to be the case. They did absolutely nothing. The New South Wales Liberal Party has tried many formulas for success. The first formula was called Lewis. The second formula was called Willis. The third formula was called Coleman. The fourth formula was called Mason. It then proceeded to McDonald-and if we are talking about dubious practice, I had better not delay by considering him-to Dowd and now to Greiner. Presumably in April it will be Foot or someone else. The New South Wales Liberal Party might have a chance of winning the New South Wales election if it goes to the central issues in politics in Australia, gets out of the sewer and stops making allegations which it cannot back up. Senator Crichton-Browne —You should be lecturing Senator Walsh, but he is not here. Senator ROBERT RAY —When we consider Senator Crichton-Browne's road-to-Damascus conversion to concern about the judiciary we find that he was silent when a leader of the National Party appeared in the chamber opposite and attacked the credentials of a Supreme Court judge. Where was Senator Crichton-Browne then? He was not even sighted. It embarrassed his political party to have to defend Mr Sinclair. There is not doubt about that. But out of some sort of mob or tribal loyalty all his people in that House voted in favour of Mr Sinclair. Mr Sinclair attacked in this Parliament the decisions of a judicial inquiry. He impugned the impartiality of Mr Justice Cross and would not accept the decision. He attended a National Party meeting in Canberra and made these allegations. I understand that. I am not bitterly critical of Mr Sinclair for coming out in the way he has done. Many stories about corruption are going around. Mr Sinclair got excited. He went to the conference. He met all the fellows there and suddenly came out with the allegation that two people had attempted to bribe him. Having said that , the police interviewed him and he backed off. He appeared before the inquiry and backed off even further. Having backed off, he went into the chamber opposite and attacked the judiciary. Yet Senator Chaney says that Senator Evans is being contemptuous of the role of parliament. Members of the Opposition rip it up as often as they can. I move on to the opinion of Mr Temby. There are two or three rather clear aspects of it. I think that the Attorney-General has put very lucid reasons as to why the tapes at this stage have not been tabled in this chamber. On page 2 Mr Temby said: The first general point to be made is that the material I have seen could not of itself warrant the laying of charges against anybody. Neither the tapes nor the documents are original, and it may be that they have been fabricated. The first step, if any aspect of the matter is to be taken further, is to establish their authenticity. On page 6 Mr Temby goes on to say: There is nothing in the material I have seen, assuming its authenticity, which would prove or in any way support the conclusion that (the Judge) has been guilty of misbehaviour within the meaning of section 72(ii) of the Constitution. Yet Opposition senators come into this chamber wanting us to table tapes which most people concede were gathered illegally, cannot be authenticated and may well, because of their salacious nature, ruin the careers of certain people. They want to do that not because of their concern for this institution or their concern with the basic issue; they want to do it only for short term, politically expedient reasons-to try to get some benefit for their poor, bedraggled colleague in New South Wales, Mr Greiner, who, as I said, is struggling, with 13 figures, to get a majority in that State House. Motions condemning the Attorney-General have been moved before and they always follow the same pattern-failure to establish a case against the Attorney-General and generalisation based only on trying to undermine the Attorney-General's reputation. I say in conclusion that the Opposition will live to regret many of the statements it has made in the debate yesterday and in the debate today. I remind it that when in opposition we have sometimes learnt the lesson about opening our mouths and trying for the most opportunistic reasons to generalise in regard to a case-the words are quoted back when in government. I say to members of the Opposition that many of the statements that they are making now will come back to haunt them in the unlikely event that they are ever re-elected to sit on this side of the House. I defend the Attorney-General not only because I regard him as a friend but also because I regard him as a good performer in this House. I believe that in any objective sense he has handled this matter with integrity and correctness. How the jackals on the other side, the lawyers on that side, became lawyers I do not know. Senator Chaney said yesterday that even if it took 50 years he would not be as politically or as legally qualified as Dr Griffith. I think that he is being conservative as usual. I think that Billy the goose would know more about the law than he. Members of the Opposition will live to regret those sorts of generalisations. Before this place descends any further into a rabble I move: That the business of the Senate be brought on. Question resolved in the affirmative. Senator WATSON(Tasmania)(4.50) —I move: That the Senate take note of the papers. Clause 13 of the Schedule to the Airlines Agreement Act 1981 governs the financial information furnished under the Airlines Agreement. The Schedule provides that the accounts shall be governed by the Victorian Companies Act. That being so, there is still a tremendous variation between the two operators in the manner of presentation of their accounting information. When one compares a bottom line performance-the profit or loss before abnormal items and income tax expense-with the approximately comparable revenues, one can see that the profit of Ansett Airlines of Australia at $14,740,830 compares very favourably with the loss for Trans Australia Airlines of over $19m. That indicates that one airline is far better managed than the other and that it utilises equipment and resources far more efficiently, but the matter of real concern to this Senate is the difference in the treatment of depreciation. The two airlines do not depreciate on the same basis. One amortises its interest and adds that to the capital costs of the equipment. There are differences between the two operations in their treatment and disclosure of depreciation, their treatment of interests, their inclusion of audit fees and their superannuation costings. I would think that governments interested in a fair comparison between the airlines would ensure that there was comparability in the way expenses are outlined and disclosed in the annual reports. Another matter of great concern is the delay in presenting these reports. For example, the report of the Auditor-General in which he qualifies TAA's accounts is dated 24 February; that is, in respect of accounts up to 30 June 1983. I just cannot understand how modern-day accountants and governments are prepared to allow interest, a period charge incurred year by year, to be added to the cost of the asset and then amortised according to the flying life of the respective aircraft belonging to TAA. A few years ago a land investment company did this in South Australia. It amortised its internal costs to such an extent that the valuation of the assets was above their estimated realisation value, and consequently it ran into financial difficulties. TAA is certainly on a collision course in using this sort of technique. I am very pleased that the Auditor- General has brought this to the attention of the Parliament and qualified the accounts accordingly. There was some criticism at the time of Mr Bridgen's appointment because he did not come from the recognised schools from which Auditors-General are usually appointed, but I must say that he brought in his own way to that office a high degree of professional expertise. His contribution has been very much appreciated by the Public Accounts Committee which, as honourable senators know, was responsible for bringing to this Parliament its 199th report. Many of its provisions were adopted by this new Government as a means of upgrading the financial presentation of statements by statutory corporations. I hope that the Government puts pressure on TAA to make sure that it changes its attitude to depreciation and interest, because it is certainly unsatisfactory. Its hypothesis of matching costs and revenue may be relevant in the normal sense, but in relation to TAA's very highly geared operation I think it is most unsatisfactory. A 'highly geared operation' is something like a motor vehicle going up a hill. A car that is highly geared runs into difficulties if it has a heavy load. An operation that is low geared-in other words, has high capital in relation to its borrowings-is in a much more satisfactory position to encounter financial difficulties on the way. The ACTING DEPUTY PRESIDENT(Senator Haines) —Order! The honourable senator's time has expired. Debate (on motion by Senator Peter Baume) adjourned. Senator ARCHER(Tasmania)(4.55) —I move: That the Senate take note of the papers. The charter of printing and publishing responsibilities is a very welcome document to those of us who have been involved in this for some considerable time. When I say 'some considerable time', it was at a meeting of the Publications Committee on 15 September 1976 when this matter was first put in train. As a result, the Publications Committee did an investigation and produced a report which was ordered to be printed on 23 November 1978. From then until today, 6 March 1984, we have been trying to get these guidelines into operation. That goes a long way towards bearing out the fact that, if one wants to see something not done, one should commit it to a committee. Anyway, we now have these guidelines. I trust that they will be taken in the manner in which they were intended to be taken. I am not normally one who favours regulation in any form unless it is necessary , but I require responsibility. I have to say that that has been noticeably absent from some departments and authorities at various times. As a result, this document had to be produced. The Committee, over the period of this document and the previous one, laid down standards; and it was decided that those standards should be adhered to. I remember that, in spite of those conditions, at various stages various client departments took upon themselves to ignore those standards totally. I am not sure whether I remember rightly, but I think the National Capital Development Commission at one stage, in spite of the conditions, produced a magnificent product with which it won a national championship or competition-completely contrary to the wishes of the Committee. The whole basis of having these regulations is so that the Australian Government Publishing Service can operate effectively and efficiently and do the job for which we provide considerable expertise. We want to to be able to organise and to regulate the work that goes through from the various departments . We want it to be of benefit to the private sector, too, in knowing what is coming and seeing that it is adequately and evenly distributed. For the other members of the Committee at its various stages, particularly Senator Elstob who is still a member, this must be a matter of some satisfaction. The secretary of the day, Mr T. H. G. Wharton, would also, I think, have given up long ago had it not been for the odd little needles that he was getting and giving at various times. It is also appropriate to say that we appreciate the co-operation that we have had from Mr John Thompson, the Government Printer, for his professionalism and the way in which he has dealt and still deals with us and the Committee at all stages. The main difficulty that I have is that I do not like regulations, and I regret that it becomes necessary, when people do not do the right thing, to have to produce them in a manner such as this. Senator ELSTOB(South Australia)(5.01) —The Charter of Commonwealth Printing and Publishing Responsibilities presented today by the Minister for Administrative Services, Mr John Brown, represents the final statement on the formalisation of relationships between the Australian Government Publishing Service and the Parliament, departments and statutory authorities. I was a member of the Joint Committee on Publications which, under the chairmanship of Senator Archer, identified the need, in 1978, for the establishment by charter of the respective printing and publishing roles and powers of the Government Printer, the AGPS, departments and statutory authorities. The Committee, in 1978 in its sixth report, stated that: The lack of clarity in government decisions in this area is such that confusion of responsibility between the various Commonwealth publishing agents has become a significant problem. As a consequence, there has developed a considerable amount of inter-departmental bickering over each other's functions. Often departments and statutory authorities ignore or resist AGPS circulars. In other areas, client departments consider that the AGPS has overly asserted its role to a degree where it has been labelled as a policeman and regulatory authority rather than a service agent. In chapter 18 of its report, the Committee laid down, in the form of a charter of responsibilities, what it believed to be the role of the various Commonwealth printing and publishing agents. This was, however, not acceptable to the former Government, which gave the task of formulating the charter to a standing inter- departmental committee. It is necessary to mention the delay taken in the finalisation of the charter. The sixth report of the Publications Committee was presented in November 1978; so the charter, which was stated by the former Government as being a priority task, has taken over four years to be finalised. When the Government response to the sixth report of the Publications Committee was tabled in the Senate in October 1979, I expressed my disappointment in the large number of recommendations that were not accepted by the former Government. In particular, I pointed out that the Government Printing Office was not operating as efficiently as it should because the Executive Government did not provide the Printer with a continuous flow of work. The position has deteriorated since I made that speech to the Senate. In 1978 departmental 'in-house' printing facilities operated at a cost to the Commonwealth of $7.6m. Last year the Public Accounts Committee estimated that the amount has grown to $14,688,000m in 1981-82. Evidence over the years has suggested that there is a need to co-ordinate government printing throughout the Executive departments properly in order to ensure the continued competitiveness and viability of the Government Printer. The expansion of 'in-house' printing has resulted in the underutilisation of plant and equipment at the Printing Office, especially during 'fill-in' periods between parliamentary sittings. It has been an issue of concern to me and to the Joint Committee on Publications for some time that the Government Printer be equipped to ensure that the best possible service is provided for the Parliament and the Executive Government. I feel that the growth of 'in-house' printing in conjunction with the advancement of printing technology could place the economic operation of the Printing Office at some risk and will have implications concerning the redundancy of printing tradesmen. The Joint Committee on Publications has drawn this matter to the attention of the Prime Minister (Mr Hawke) and the Minister for Administrative Services and is presently awaiting a reply. While the charter tabled today by the Minister lays down formal guidelines for printing and publishing activities of the Parliament, departments and statutory authorities, I would suggest that there is an obvious need for a board of review with a permanent secretariat, as recommended by the Joint Committee on Publications, to report at least annually to the Committee on such matters as significant departures from AGPS circulars and from the charter of responsibilities by Departments and statutory authorities. Debate (on motion by Senator Martin) adjourned. Senator CHANEY(Western Australia-Leader of the Opposition in the Senate)(5.06) -I move: That the Senate take note of the paper. I welcome the fact that this report is now tabled in the Parliament and available for our examination and comment. I note with approval the fact that the Minister for Aboriginal Affairs (Mr Holding) has quoted some words of Mr Justice Toohey in the brief statement which accompanies the report. I should like to quote those words now. Mr Justice Toohey said: The number of amendments recommended to the Land Rights Act may be thought to suggest substantial defects in the legislation. It would be a mistake to draw that conclusion. Given the legislative novelty of subject matter of the Act and the need to marry complex notions of traditional Aboriginal law and culture with European institutions and administrative procedures, the Act has worked surprisingly well. But it is inevitable that after 7 years cracks in the edifice have started to show. This report seeks to show how those cracks might be mended while leaving the overall structure intact. It is worth remembering, too, that Mr Justice Woodward in one of his reports which were at the foundations of the legislative action which was taken by the Fraser Government in 1976, stated that there were elements in what he had recommended that were matters of judgment. He said that he thought the Act would need to be reviewed after some years of operation. Those who have been strong supporters of trying to give secure land tenure to Aboriginals-whether one calls it land rights or any other name-ought to be prepared to examine the actual workings of the structures that have been put in place and to admit to the possible need for some change. My perspective on the matter has always been from the viewpoint of Aboriginal affairs. My recent translation into having some responsibilities in the Opposition for resources and energy matters has put me in more regular touch with a very substantial body of people, many of whom I had known before, namely, the miners. They have found very great difficulties with the legislation which we passed in 1976. Mr Justice Toohey's report deals with the sort of difficulties which have been raised with me. This subject has probably been the most frequently raised subject in any of the conversations that I have had with industry over the last 12 months, be it the mining industry or the petroleum industry. The reality for those industries is that they have found in the Northern Territory that the procedures which are laid down to obtain exploration entitlements are such that in fact no exploration licences have been granted on Aboriginal land. Given that something like half the Territory either has that status or soon will have it, it is understandable that they are expressing concern. Further south, in South Australia, I have had similar expressions of concern about the operation of the Pitjantjatjara land rights legislation, the difficulties faced by miners, and the fact that one major explorer, Hematite Petroleum, which I think is now known as BHP Petroleum, took its exploration proposals away because of the difficulties it was experiencing in coming to arrangements under the Act. In the very brief time I have I merely wish to flag that as a matter which I think warrants parliamentary attention. In the period of change we are going through-the Labor Government in Western Australia has undertaken to legislate in this area, there is further legislation in South Australia and there is the possibility of some change in the Northern Territory- I think we need to address ourselves to the practical problems which have arisen and which I believe have caused a very considerable amount of disquiet in those States where, as in Western Australia, legislation is proposed. I believe, as I expressed in a newspaper article last week, that it is possible to find a workable solution which will protect genuine Aboriginal interests and ensure that they have secure tenure and which at the same time will admit to the very real need in Australia in 1984 to see national development that will produce the economic growth on which most of our social and other programs depend. In this very brief comment I welcome the report. I hope we will subject it to careful consideration and that there will be some improvement in the rules which have been produced to date to produce situations which will be better for the interests of both Aboriginals and non-Aboriginals in Australia. Senator COLEMAN(Western Australia)(5.12) —As Senator Chaney has said, the report of Mr Justice Toohey is very interesting. We have already had in the Parliament this week the introduction of the response to the report of the Standing Committee on Aboriginal Affairs on the proposal for town camps. I read with interest this recommendation of Mr Justice Toohey: . . . the adequacy of existing leases for town camps be the subject of further investigation. I think this can only improve the lot of the majority of Aboriginal people. The other area in Mr Justice Toohey's report that I found particularly interesting was the representation of women on land councils. He states quite clearly that there has not been sufficient representation of that sex on the majority of the land councils but points out that a woman was recently elected to the Northern Land Council. I draw the attention of the Senate to the fact that International Women's Day occurs on Thursday of this week, 8 March. I hope that the Aboriginal women will not be forgotten in the celebrations that will be going on throughout this country and throughout the world. It is interesting to note that Mr Justice Toohey says: The experience of the land claims has been that in each community there have been women prepared to speak out on matters relating to the land or, by performing song and dance, to demonstrate their knowledge of the land and their affinity with it. In other Aboriginal organisations women exercise forceful and effective leadership. . . . while it is true that in Aboriginal society some matters are regarded as 'men's business' and some 'women's business', too much emphasis on this distinction can obscure the fact that many matters are important to both men and women. I think it has to be recognised that since the advent of women in such large numbers in this place it has become a much more reasonable place for debate. I do not think that my male colleagues would dispute that. It is interesting also that I make these statements, Madam Acting Deputy President, while you are in the Chair. Senator Sir John Carrick —Hear, hear! Senator COLEMAN —Senator Sir John Carrick agrees with me. I think we have brought a measure of stability to the Senate, as I am sure Aboriginal women would bring a measure of stability to some of the actions of the land councils that operate around the country. It is always of concern to me that in some communities, not necessarily those in Aboriginal society but more particularly in white society, women are progressively being pushed to the tea-making rather than the decision-making area. I am sure that I do not need to tell you, Madam Acting Deputy President, that that occurs particularly at Party branch meetings, where it is anticipated that the women will make the tea and the men will make the decisions. I found the entire report of Mr Justice Toohey to be a very important one. Senator KILGARIFF(Northern Territory)(5.15) —I wish to make a few remarks regarding Mr Justice Toohey's report, 'Seven Years On'. I think Senator Coleman would be happy to see what is now occurring in the Northern Territory with the participation of Aboriginal women. They are playing much more of a leading part in the councils and in matters relating to Aboriginal affairs throughout the country. It is quite interesting to see the way Aboriginal women are developing now. Very many fine leaders are coming forward. As the report states, it is now seven years since the introduction, through Federal legislation, of land rights in the Northern Territory. It is a unique piece of legislation which relates only to the Northern Territory and not to any other Territory or State. In the early days of the legislation, in 1976, I was a member of the Aboriginal Land Rights Committee which was set up by the then Minister for Aboriginal Affairs, Mr Viner. The Committee was directed to look at a number of issues such as the closure of waters on the northern coastline and supplementary legislation through the Northern Territory Legislative Assembly. This Committee had no authority to review any matters in relation to the Aboriginal Land Rights (Northern Territory) Act except those which were directed to it by the Minister for Aboriginal Affairs. As a senator for the Northern Territory, I found this regrettable because the Act is a massive piece of legislation with considerable effect on the land and the people of the Northern Territory. I believed, and still do, that Parliament should always have had an on-going committee to watch the workings of the legislation and make recommendations to the Parliament regarding proposed amendments which could have helped to overcome any problems which have arisen. Indeed, problems have occurred, and that is not surprising, considering the complexity of the legislation and the fact that it has had no overall review. Some amendments have been made but, in the main, these have been directed at a narrow field, mainly to permit land councils to operate smoothly and to assist them with their financial affairs. I believe the real problem with the legislation has come mainly as a result of interpretation by the courts following challenges regarding the land rights Act. Many of these have resulted in principles which were not, I believe, the intention of the legislators in 1976 now being accepted. I refer to the very many contentious matters regarding the interpretation of what is alienable land and what is not alienable land. The High Court's decision has opened up a great deal of new land to claim. Originally, Mr Viner, the then Minister for Aboriginal Affairs, stated that he thought it would cover about 18 per cent of the Territory. That estimate became 28 per cent, and now it has grown to 45 per cent to 50 per cent. I have known Mr Justice Toohey for some years in his capacity as Aboriginal Land Commissioner. I believe that in conducting many land claims in the Territory he has earned himself a reputation as a man of integrity. However, with regard to the tabled report, I believe Mr Justice Toohey's terms of reference were far too narrow, and I am disappointed that an open hearing was not conducted. I believe that after seven years in operation the Act is due for a complete public review. However, under the terms of reference of the inquiry, Mr Justice Toohey was asked to review the Act only within the confines, as I understand it, of the five Australian Labor Party principles in relation to Aboriginal affairs. The inquiry provided him with an opportunity to review in general the progress of the Act. We could have considered whether the original objectives of the Bill have been fulfilled and, if not, why not. However, the Minister for Aboriginal Affairs (Mr Holding) chose instead a restrictive and almost secretive approach to the inquiry, making a general review impossible. I find particularly disappointing the fact that members of the public, the people most affected by the Bill, were not given an opportunity to put forward their views. The Government, apparently deliberately, kept the inquiry on a narrow and somewhat private level. Only selected people and groups appear to have been invited to give evidence. When the report was completed only a limited number of editions were made available. The Minister evidently handed them out to the people who were perhaps in favour of the report's findings. I, for instance, was not given a copy of the report although I certainly requested one. The honourable member for the Northern Territory (Mr Reeves) received a copy of the report. The report came into my hands only a short while ago. It will require considerable time to come to grips with Mr Justice Toohey's thinking and recommendations. As time is short and there is no opportunity to take this matter further I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator PETER BAUME(New South Wales) —I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. The ACTING DEPUTY PRESIDENT(Senator Haines) —The time allotted for the debate of ministerial papers has expired. Debate resumed from 5 March, on motion by Senator Button: That the Bill be now read a second time. Senator Sir JOHN CARRICK(New South Wales)(5.22) —The Senate is debating the Liquid Fuel Emergency Bill 1983 which is an important piece of legislation. I think the background of this Bill is of considerable interest. I have a personal interest in it because I happen to have had the privilege of being the Minister at the time of its origin. On the international scene, I happen to have been the minister at the time that the International Energy Agency, in Paris in 1978-79 and specifically, in 1979, looked at the questions of how to face up to a shortage of oil throughout the world, and how to get a sharing of oil, not just within any one nation but within the international scene. Indeed, the IEA set up a scheme called the emergency oil sharing system. This was of particular interest because some 22 nations were invited to join in working out a system of orderly sharing of petroleum products should there be a crisis. This was done against the background of the Organisation of Petroleum Exporting Countries oil crisis which had extended from 1973, when the price of oil was quadrupled, to 1979, when we had the Iraq-Iran situation. We had the Iranian revolution and the great fall in the output of oil from Iran and subsequently the years of turbulence in the Middle East. The International Energy Agency therefore decided that it would need to have an emergency oil sharing system. Each nation was asked to participate. Australia agreed that it had a responsibility in this regard. The Fraser Government decided that it would be necessary to have an orderly system of sharing of petroleum products should such an emergency arise. It set up in, I think, September 1979, what was called the National Petroleum Advisory Committee. It was a committee very representative of the whole community. It had representatives from agriculture, fishing, manufacturing, mining, shipping and transport. It had representatives from the motorists organisations and, very importantly, from the Australian Council of Trade Unions. From recollection, it was chaired by Sir Frank Espie, a very distinguished Australian. I commend the Committee for its long and very valuable work. Again, from recollection, the Committee deliberated for some two years. In October 1981 it produced a report entitled 'The Management of a National Liquid Fuel Supply Emergency', a very comprehensive document, which formed the basis of government thinking both by the Fraser Government and the present Labor Government and formed the basis of the emergence of this legislation. The document itself was then studied in great depth by the States, Territories and organisations. I should add that, in addition to all those who were represented on NPAC, the States and the Territories were of course represented. That document-'The Management of a National Liquid Fuel Supply Emergency'-was tabled in, from memory, 1982. Both at the Commonwealth level and the State level it was accepted as being a basis for future planning and development. It meant that there needed to be very detailed discussions with the States and the Territories to try to get a basis for a working partnership between the two. The States, of course, were very jealous of their own rights and great responsibilities in any crisis; the Commonwealth would be the first to acknowledge that. The discussions were very difficult therefore under certain circumstances. The aim of those discussions was: to get a system of distribution in the case of an emergency in which there would be equity of distribution; that is, nationally a uniform proportional reduction in the level of supplies-in other words, petroleum products should be shared equally throughout the Commonwealth. That in itself was a useful basis. But there were two other important things to be considered. Firstly, there was the important principle that essential industries or activities might need to have more fuel than others and, secondly, there was the principle that there were high priority users. I commend not only NPAC for the work it did and, in particular, Sir Frank Espie , but also the State Ministers and State officers who took part in these complex and difficult discussions which finally brought this basic Bill before the Parliament. No one ever suggested that this would be the final solution to what is a massively difficult problem. There were the ordinary difficulties of State rights. It was agreed in general that the Commonwealth would pursue a particular line, as it is doing in this legislation, and that there would be continual discussions in the months and years immediately ahead to see whether both the States and the Commonwealth could produce alternative legislation which, in the end, would supplant this legislation and which would be more tidy. The magnitude of this legislation is very real when one is confronted with it. A sunset clause of some three years was envisaged so that one would have a target for getting alternative legislation. It was thought that it may take more than three years and that the legislation may have to be extended. That is the basis for the legislation and one would not, therefore, cavil about it. One would want to wish it a happy passage and hope that the discussions for the future on alternate legislation will be full and fruitful. At the moment there is temporary quiet in the general environment of petroleum supply. I was at the International Energy Agency when we decided upon this emergency oil sharing system and had discussions with the OPEC partners on the matter. Throughout the world, both in the Organisation for Economic Co-operation and Development and the IEA, there is a strong understanding that the present doldrums period is a temporary lull. The understanding-if one looks at IEA reports, attends its meetings and has discussions with OPEC-is that down the track some three, four or five years ahead there will be future oil crises primarily because of two factors: Firstly, we are using oil, even now, faster than we are finding it. We were in fact using it at twice the rate we were finding it, but there has been good conservation. Secondly, as the developing countries lift themselves up, they must look to oil as the first line of energy since they have no other basic resources. So there will be a demand for petroleum fuels from the developing countries and that will increase competition. No matter how strenuously the developed countries may strive to conserve and to use alternative fuels-they have done better than one dreamed in that regard-nevertheless the pressure on petroleum products will be very real indeed. That is a primary situation to keep in mind. I point out that one tends to be rather complacent in a declining oil price situation and when there is a glut, as there is at this moment, of oil in the world. One needs to remind oneself of the various situations that will emerge. The world will be burning up and using one of its two non-renewable fossil fuels, oil. The other is coal. It must watch coal too in the longer term because it is a precious hydro-carbon, a precious store of chemicals. Oil may well get some reprieve in the sense that we may, by intensive exploration, find more petroleum products, particularly gas, and so extend the frontiers, but in the decades ahead crises will occur. I have failed to point out the more terrifying spectacle, the perilous situation in which the world finds itself with regard to the Middel East. I was privileged to be a guest of those countries, to visit them and to have discussions with their governments. One realised just how close one was to the frontiers of war, the frontiers of revolution. In terms of OPEC oil supply the world is walking on a knife edge. There is the threat of war. I would like to make one or two other comments in that regard. During the 1970s there was a confrontation between the world of consumers of oil, the IEA type world, and the world of providers of oil, OPEC, as though the two has vastly different self-interests. They virtually had a running verbal war. In fact, both realised that they depended upon the prosperity of a stable world in order to have any kind of prosperity. All too late in the journey they realised that there may be a community of interest in having stability in oil production and distribution and oil price. Indeed, some of the OPEC leaders, including Sheik Yamani, realised this and gave leadership in the world. What was not understood was that OPEC is not a homogenous group of 13 nations, all of them oil rich, all of them looking to a long term future. Within the OPEC structure there are two groups of nations. A small number of nations have great potential supplies of oil in the ground, long term prospectivity and a long term hope of providing very large amounts of oil to the world. They have a different outlook from the more numerous nations, many of them smaller, which are very dependent on oil. There is the likelihood of their oil running out in 10, 15 or 20 years' time. They face the conflict of whether they should go for a high price and a quick price now in order to stabilise their industries in other ways, or whether they should spin it out. So there is considerable difficulty within OPEC. I would like the Australian people to understand not only the problems of the consumers but also the problems of the producers and distributors. Some of those countries are close to us. Indonesia is just such a country. At the moment Indonesia faces a very finite, short term future in her capacity to supply oil. She is faced with the need to diversify and the knowledge that she will not continue getting export earnings of a considerable magnitude in the future from oil. She may of course, and I wish her well in her journey. She may make discoveries that will prolong the situation. It is important to understand that some nations inside the OPEC structure have very real problems indeed. It is important that we should have dialogues with them and not only with the consumers. To form rigid cartels entirely of producers and consumers is, in my judgment, not an intelligent situation. When one looks at the world around us no one can predict how long we can keep a reasonable self-sufficiency. At the moment we are about two thirds self- sufficient. We import one-third or 30 per cent of our requirements. The Minister for Resources and Energy (Senator Walsh) has said, and I agree with him, that it is not just a question of producing more oil to become 80 per cent or 90 per cent self-sufficient because the kind of oil that we have found in Australia, and are likely to find, is at the light end of the barrel, the light end of the fractions. It is the gasoline and kerosene type, not the lubricating oil and bitumen type or end of the barrel. Australia needs very much the heavier end of the barrel; it needs the heavier fractions and it cannot readily produce those fractions from the fractionation of its Bass Strait or on-shore oil. It is true that given an emergency we can do other things. We can not only recycle lubricating oil, but we can also use the lubricating oil much longer than we tend to use it now. Nevertheless, it is true that, even if we produce the lighter fraction oil at two-thirds or more of the present volume, we will still have to import the heavier fractions. There is no certainty that Australia will be able to continue for any indefinite period to provide two-thirds of its oil needs. We have been able, by the tremendous increase in exploration during the years of the Fraser Government , to extend the frontiers. I said in the Senate only a few days ago that in 1977 it was common for the authorities to say: 'We are now 67 per cent self- sufficient. Unless we find major discoveries, by 1985 we will be 50 per cent self-sufficient, by 1990 we will be 40 per cent self-sufficient and by the turn of the century we will be 20 per cent or even 10 per cent self-sufficient'. That would be an enormously difficult situation and not only in terms of supply. I will give one example. Every 10 per cent increase in the necessity for us to import oil-supposing we had to lift our imports from 30 per cent to 40 per cent of our needs-means a drain of another $1 billion on our foreign exchange earnings. Quite clearly, it is impossible for us to earn sufficient money for us to import oil in unlimited amounts. It is worth saying that the substantial reason for the recession during the 1970s was a gradual and imperative shrinking in the ability of nations to trade because they had to pay more and more of their valuable foreign exchange earnings for the same volume of oil. The Indian Government told me several years ago that it was using as much as 80 per cent of its export earnings simply to import oil. Clearly, Australia would be in a profoundly difficult situation if that were so in our case. We are one of the large trading nations of the world, particularly in regard to our wheat, wool and minerals. Nevertheless, from time to time we have acute, even chronic difficulties with out balance of trade and our balance of payments. There is no way in the world in which we could look towards making up, by way of imports, for the significant falls if we did not make oil discoveries. It is true that the figures for 1977 are no longer relevant. We are able to say that by 1987 or 1988 we could be about 77 per cent self-sufficient in out oil needs. But the experts now say that as we enter the 1990s there will be a fall in our output unless we can produce new fields of considerable substance. Fortescue has given us a reprieve. One can only hope that the testing of Jabiru will give us another great encouragement. I hope that because of the siting of Jabiru in the Timor Sea, and its relationship to the Northern Territory, it will prove a highly successful field. I hope that that whole area will prove highly prospective. Even if Jabiru should come good and even though we are now finding more oil on shore than we believed would be the case, we walk perilously in regard to self-sufficiency. It is true that we may have to reshape our thinking. In the Cooper Basin we acted on geological advice that we would not find oil in a particular stratum. The Strzelecki oilfield taught us that if we looked in another stratum we might find the oil. It is a great tribute to the free thinkers that we found oilfields such as Strzelecki and we opened up great possibilities. I commend particularly those who were in partnership to build the pipeline from the Cooper field to Stony Point and Whyalla. I commend that initiative because the actual and potential gain of the pipeline that has the capacity at this moment, not under pressure, of 35,000 barrels a day-under pressure it could produce 80,000 barrels a day-would add greatly to Bass Strait, which produces about 440,000 barrels a day. To back up the Liquid Fuel Emergency Bill, we need to keep the pressure on our exploration and development and to keep the incentives deeply embedded in Australian society to attract capital from overseas so that exploration can go ahead. One of the threats to Australia is the danger of accidents or terrorism in regard to our installations. We are very fortunate that Bass Strait is such a highly prospective field and that it is so closely situated to our great developing areas of Victoria and New South Wales. But the fact is that all the oil wells in Bass Strait have been linked until now to one main pipeline coming through one main platform to the shore. Alternative arrangements have been made. Nevertheless, there is a vulnerability. That vulnerability will be somewhat relieved, but not overcome, by alternative pipelines situations. The danger of an accident to an oil platform in Bass Strait is very real. Bass Strait experiences storms and poor visibility. It is situated in a very busy traffic stream, particularly in regard to container and ore vessels. That danger will always be there. So there always has been a need to take the precautions which have been taken in recent years. I was privileged to be able to make a number of decisions in that regard. The present Government will no doubt want to carry them further. We do run risks because our fuel supplies are concentrated in a very tight spot . Also, it is possible-sadly, we have seen it in the past-for industrial unrest to tie up the oil industry. If there were to be a congestion at the end of a liquified petroleum gas pipeline or at another point, it would be possible for that to slow down or even bring the fields to a stop. All of these things are understood. I sketch them simply to say that a Bill of this nature of course, it is universally supported by both sides of the Parliament-is more than it appears on the surface. It is certainly a sign of very welcome teamwork between the Commonwealth and the States. It is certainly a sign of useful input of a host of different industries. It is certainly proof that when this Bill is passed we will have in place a capacity to act quickly if an emergency should occur. Again , I pay tribute to the States for their willingness to let that happen in what is still an imperfect world of legislation and arrangements. I commend the Bill and all those who have worked on it. When this Bill is passed Australia will be somewhat better equipped to deal with emergencies, wherever they may occur. The States, the Commonwealth and industry will need to apply themselves to make a much tidier situation of alternative legislation. It would be wrong now to say that because we have this legislation we do not need to do more. This is the very point; we do need to do more. Against all that, the best liquid fuels emergency situation we can put into practice is to keep on with exploration of maximum intensity so that we can find more petroleum products-be they gas or liquid fuels-on-shore and off-shore. The best emergency system is to store our oil gas underground so it can be called on when needed. That is the best of all the emergency systems. In the many discussions that the Senate has had and will have on incentives, whether they be resource rental taxes or whatever, the focus must always be on the fact that this country would grind to a halt if it did not have petroleum. It is worthwhile bearing in mind that in the mid-1970s there was a real view that this country's industrial progress could stagnate because it would not have the necessary petroleum products. In my time as Minister I was privileged to have a magnificent Department of very fine advisers. Again, I pay tribute to those advisers within the Department who helped in the shaping of this legislation. When I was Minister I came to the conclusion that there were three main ingredients which needed to be put in place if one were to overcome such an emergency in the development of Australia. The first was that we needed an assurance of a continuity of petroleum products. The second was that in order to get alternative fuels we needed to use properly the fuel-coal- that is most abundant in Australia. We needed to have in Australia a widespread development of power stations so that we had considerable more power than we urgently needed for the moment. This was so we could use alternatives. The third point was that we needed water supplies, both in towns and country, to continue that development. I take these points as a parcel and commend the legislation. Senator KILGARIFF(Northern Territory)(5.53) —It is worth noting the remarks of Senator Sir John Carrick, who was previously the Minister for Resources and Energy. He is a man of considerable experience and a man who in the previous Government, chaired international organisations relating to the matters before us. It was most interesting to hear his remarks. I think the Minister for Resources and Energy (Senator Walsh) is to be commended for introducing the Liquid Fuel Emergency Bill 1983. It is a most necessary piece of legislation. The Bill has been developed after discussions with various oil companies, the Australian Institute of Petroleum and Senator Chaney, the Leader of the Opposition. Therefore, this effort by the Government, which has consulted the various people I mentioned appears to have resulted in the introduction of a Bill that will go quite a long way towards improving the position. I note that when we talk about liquid fuel emergency legislation the explanatory memorandum to the Bill states that the Bill: . . . provides the Commonwealth Government with the powers to enable it, in consultation with the State and Territory Governments to effectively coordinate the management of a national liquid fuel emergency. The Bill, it continues: . . . is based on the cooperative approach between Commonwealth, State and Territory Governments recommended by the National Petroleum Advisory Committee ( NPAC). All Governments have endorsed the NPAC report. The Bill will enable an effective response to a national liquid fuel emergency to be made. The powers in the Bill are complemented by powers in existing or prospective State and Territory legislation. There is much that could be said regarding this matter of liquid fuel, its future in the world and the importance that it plays in our lives today. I could not help but think, when listening to Senator Sir John Carrick today and Senator Mason yesterday when they said that the world was fast running out of liquid fuel, that that is not quite accurate. I think that while we have to conserve our liquid fuels throughout the world-certainly in Australia-we have to do much more in exploration. Liquid fuels still have a very major part to play in the world. I do not think that they are fast running out. I, too, have had the opportunity to spend some time in Arab countries. It was interesting to ascertain their reserves of oil for the future, having in mind the amount of fuel produced, processed and sold today. It was a subject that very few people in the Arab countries cared to discuss. It seemed to be, without any exaggeration, almost a taboo subject. It was easy for some people to give guesstimates of 50 years of fuel remaining. I am talking of the Middle East area . There are other people who are prepared to go much further because as Senator Sir John Carrick has said, there are many areas in the world-surprisingly so in the Middle East-which are still untapped and unexplored in regard to oil. One would think that there are such considerable reserves in the Middle East that if we continue to use fuel at the rate we are now one could imagine those oil reserves lasting far longer than 50 years. Senator Sir John Carrick would think too, I am sure, of the empty quarter. The empty quarter is perhaps an area which has vast resources that are as yet untapped. That does not mean that while we are taking a much more generous, call it that, view of the situation, if we could that fuel should be wasted; far from it. It is easy to imagine too that perhaps when we have a national emergency it will not be brought about by the shortage of fuel in the ground, but as a result of some other situation. It is only in the last couple of weeks that we have seen the threat to supplies of oil through the Straits of Hormuz as a result of the conflict between Iraq and Iran. I had the opportunity to see the enormous tankers passing through those straits. It is an incredible scene to see several tankers pass by each hour of the day. However, this source could be cut off in an instant as a result of war. If that was so, Australia and many other countries could be seriously affected. At present Australia is still importing 30 per cent to 35 per cent of oil requirements. I think that legislation for a national emergency situation is an excellent idea. The legislation ensures that with the co-operation of the States and the Territories we can bring about, at least on paper, a plan to conserve liquid fuel in an emergency. I believe that other things must be done. It would only be window dressing if this legislation was passed-as it quite obviously will- without other action being taken. We must look to advisers within the petroleum industry-for instance, the Australian Petroleum Exploration Association Ltd-to see what advice is given. I refer to a media statement issued on 3 February 1984 by the Australian Petroleum Exploration Association which discusses its development activities for 1984. This is quite alarming. It is all very well to pass legislation, but other things must be done to ensure the security of Australia in the future. The media statement reads in part: Australian petroleum explorers' initial drilling programmes for 1984 rival those of the past two years-but the industry is seriously concerned that political events may impair what could be a record-breaking effort. The Australian Petroleum Exploration Association announced details today of its annual survey of industry exploration and development activity. Key features of the survey are: Wildcat and appraisal well programmes show that explorers expect to drill some 240 wells, mainly onshore Seismic work remains severely depressed A projected decline in offshore drilling activity and a large reduction in onshore rig rates will have the effect of reducing exploration expenditure to some $100 million below the $950 million estimated for 1983 Programmes are highly sensitive to changing circumstances, particularly the Federal Government's proposed resources rent tax. Commitments to contractors at this stage are only 113 exploration wells. The Australian Petroleum Exploration Association continues to indicate its concern regarding the resource rent tax, and we have heard much from Senator Walsh about his feelings on the matter. The problem the Association sees is that if the resource rent tax is pursued too vigorously, or at all, it will affect investment, investment which is so necessary at this time. The statement goes on : On 3 February the Government indicated that it had abandoned-at least for the time being-its attempt to impose RRT onshore. However it continues to seek to apply the new tax to petroleum production offshore. The 100 companies which make up the Association have provided background briefing notes to people who are interested in the matter, that is, those who are opposed to such a tax. The Association continued: Briefly, APEA believes the RRT is theoretically unsound, unworkable in practice , will further distort investment if applied to only the offshore sector of the industry. It is certain to deter exploration for the 200 million barrels of oil Australia needs to find each year to maintain its self-sufficiency at current levels. In seeking to understand the potentially damaging effects of this additional tax on Australia's economic interests, you should know that the nation's commercially proven oil reserves are now 300 million barrels less than they were in 1979 despite recent discoveries. I come back to the local situation. There are some matters we should take note of; indeed, where we should endeavour to improve the situation to safeguard the nation in the event that this emergency legislation is brought into force. While it is essential to ensure a maximum level of exploration, we also have to ensure maximum development of existing supplies. There are many areas in the Middle East which as yet are untapped. Surely this is also the situation in Australia. Senator Sir John Carrick has indicated the situation off the north-west coast of Australia at Jabiru. One would expect that there is much more oil in that area. However, that brings up a particular worry that I have. I have been following the negotiations and conferences that have been taking place between Indonesia and Australia on the maritime boundary. While these talks have been going on for some considerable time now, little progress has been made in an agreement between Indonesia and Australia regarding the maritime boundary. Of course, there is a lot of oil in the maritime boundary area, and it would certainly be in the interests of Australia to give more stimulus to these negotiations in an endeavour to reach some finality with our nearest neighbour. Another matter that concerns me is that this legislation is merely window dressing if we do not ensure that the nation has considerable fuel reserves. What fuel reserves does Australia have? When a tanker cannot come into Darwin, or when there is industrial strife at a refinery for one or two weeks, immediately there is fuel rationing. This does not indicate that there are any huge reserves which can be used to back us up in a national emergency. These days one hears-I have not been able to ascertain whether or not it is correct- that the fuel reserves in our defence forces, in the Royal Australian Navy, are depleted and that our fuel reserves are dwindling because we are not keeping up the stocks which Australia is capable of holding. We are debating national emergency legislation, but it could well be that we are allowing our reserves to dwindle alarmingly. If this is the case we could well be in very severe trouble. Imagine the national emergency that could occur if our Navy were required to do something particular and there was insufficient oil. Perhaps we do not have the oil reserves to ensure that we could go through a period when no further fuel is forthcoming. I think we have to take note of that. Overall, I support the legislation. I look forward to giving more stimulus to exploration, both off-shore and on-shore. When I was home at Alice Springs last weekend I spoke to people from the Magellan Petroleum Corporation Northern Territory. Honourable senators will recall that the Corporation is developing an oil field in the Mereenies, which is on the way to Ayers Rock in a direct line from Alice Springs. There is considerable activity there now and more exploration is taking place, which is very good. The wells there now are being developed and in a reasonable time oil will be brought in to Alice Springs from the Mereenies. Having oil on the spot will help people in inland Northern Territory. Quite obviously, if we are to take a genuine interest in this legislation and in protecting our future we must ensure that our development and exploration go along at a certain pace. But to do this, of course, we have to give stimulus to the people who will carry out this exploration. It is a huge risk area. I think that it would be of considerable benefit to the Government of Australia to give every encouragement to explorers these days. Senator WALSH(Western Australia-Minister for Resources and Energy)(6.11) —in reply-As other speakers have noted, during the Committee stage of the consideration of the Liquid Fuel Emergency Bill 1983 I will be moving some 14 or 15 amendments on behalf of the Government, most of which are of a quite trivial nature. However they encompass a couple of important amendments which are the product of a series of discussions and negotiations involving Senator Chaney in particular, departmental representatives, various people from the industry and me. One would hope that this Bill will never be needed. I think that at least during its lifetime, which is limited to three years by the insertion of a sunset clause, it probably will not be needed. Nevertheless, as everybody has recognised, it is a matter of considerable importance that, in the unlikely event of a major emergency occurring, legislation is in place to ensure that the damage inflicted by a shortage of fuel can be minimised. I make just two comments on what Senator Chaney and Senator Kilgariff said. Firstly, with respect to Senator Chaney's comments on the tortuous language in which the draft guidelines have been written, I too would like to see all Bills and legislation written in more simple English. I previously believed-and I am surprised that Senator Chaney should have made this sort of criticism-that lawyers ensured that regulations and legislation were written in that language in order to guarantee employment for other lawyers through litigation, although that is a view which I know some lawyers dispute. They assert that for the purposes of certainty of interpretation if questions do come to court it is necessary that legal documents be written in that sort of legal language. If Senator Chaney, as a trained lawyer, finds it somewhat difficult to understand I am sure that he will appreciate that those of us who are not trained as lawyers find it almost completely incomprehensible. The other comment I make briefly concerns Senator Kilgariff's reference to the forecasts by the Australian Petroleum Exploration Association Ltd of exploration activity in calendar year 1984. In making those comments, Senator Kilgariff seemed to imply that the Government's policy on resource rent taxation was a factor influencing the prediction that there would be a reduction of some $100m- even in money terms-in the amount of money spent on exploration. I dare say that that is something which other people will assert. It is not that simple, of course, because the decline in exploration activity forecast by APEA at the beginning of 1983 before the announcement of the Federal election was firstly much more significant and much greater quantitatively than the decline being forecast now. But even more importantly, perhaps, it was much greater than the actual very moderate decline in on-shore exploration activity only, which, in fact, occurred during 1983. In other words, the actual level of exploration in 1983-in spite of weather-induced problems on-shore-was greater than APEA had forecast at the beginning of 1983. So if Senator Kilgariff was implying what I though he was implying, the facts, for 1983 at least, are incompatible with his implication. That is, the facts for 1983 are that the actual level of exploration was higher following the election of the Labor Government with a resources rent tax policy than had been forecast by APEA prior to the election. I would not draw the reverse conclusion, which is that the election of the Labor Government was responsible for the increase in exploration effort above that which had previously been forecast. I think that it demonstrates very clearly, however, that there are many factors involved. I make one final comment. It concerns the low level of seismic activity actually recorded in 1983, although not as low, I hasten to add, as that which was predicted by APEA at the beginning of 1983, and the predicted-low again by 1982 standards-level of seismic activity for 1984; in other words, two years of fairly low seismic activity in succession. If that should actually happen it does carry a significant risk that there will be a consequential downturn in exploration activity some time in the future, although not with a lag of 18 months to two years and not a rigid lag. But it is disturbing that seismic activity decreased last year to the extent that it did, to a level which current predictions from the industry say will not be increased in the present calendar year. I do not propose to say any more at this stage. When we move into the Committee stage I will seek leave to move en bloc the Government's amendments suggested by a number of people and to which the Government has agreed. It is quite clear that they are not controversial and they will not be contested. Question resolved in the affirmative. Bill read a second time. The Bill. Senator WALSH(Western Australia-Minister for Resources and Energy)(6.18) —by leave-I move: (1) Page 3, clause 3, sub-clause (1), line 40, leave out 'of a', insert 'of'. (2) Page 16, clause 16, after sub-clause (2) insert the following sub-clause: '(2A) Without limiting the generality of the matters to which the Governor- General is to have regard for the purposes of paragraph (2) (a), he shall have regard to the question whether the shortage, or the likelihood of a shortage, of the liquid fuel concerned is likely to be averted by the voluntary augmenting of supplies of the liquid fuel by relevant fuel industry corporations.'. Page 34, clause 41, paragraph (3) (a), line 19, leave out 'fifth', insert ' fifteenth'. Page 34, clause 41, paragraph (3) (b), line 22, leave out 'fifth', insert ' fifteenth'. Page 34, clause 41, paragraph (3) (b), line 24, leave out 'fifth', insert ' fifteenth'. Page 34, clause 41, sub-clause (4), line 25, leave out '5', insert '15'. Page 34, clause 41, sub-clause (5), line 29, leave out '5', insert '15'. Page 35, clause 41, sub-clause (5), line 1, leave out 'this section', insert ' sub-sections (3) and (4)'. Page 35, clause 41, at the end of the clause add the following sub-clauses: '(6) Where an instrument to which this section applies is made during a period of national liquid fuel emergency- (a) the instrument comes into force forthwith; (b) sub-sections (3), (4) and (5) do not apply to the instrument; and (c) sub-section (8) applies to the instrument. '(7) Where- (a) an instrument to which this section applies is made otherwise than during a period of national liquid fuel emergency; (b) a period of national liquid fuel emergency is declared to exist; and (c) on the commencement of that period the instrument had neither come into force under sub-section (3) nor been disallowed under sub-section (4), then, on the commencement of that period- (d) the instrument comes into force; (e) sub-sections (3), (4) and (5) cease to apply to the instrument; and (f) sub-section (8) applies to the instrument. '(8) If either House of the Parliament, in pursuance of a motion of which notice has been given within 15 sitting days after a copy of an instrument to which this sub-section applies has been laid before that House, (whether the notice was given for the purposes of sub-section (4) or of this sub-section), passes a resolution disallowing that instrument, the instrument so disallowed shall thereupon cease to have effect. '(9) If, at the expiration of 15 sitting days after notice of a motion to disallow an instrument to which sub-section (8) applies has been given in a House of the Parliament, being notice given within 15 sitting days after a copy of the instrument has been laid before that House- (a) the notice has not been withdrawn and the motion has not been called on; or (b) the motion has been called on, moved and seconded and has not been withdrawn or otherwise disposed of, the instrument specified in the motion shall thereupon be deemed to have been disallowed. '(10) If, before the expiration of 15 sitting days after notice of a motion to disallow any instrument to which sub-section (8) applies has been given in a House of the Parliament- (a) the House of Representatives is dissolved or expires, or the Parliament is prorogued; and (b) at the time of the dissolution, expiry or prorogation, as the case may be- (i) the notice has not been withdrawn and the motion has not been called on; or (ii) the motion has been called on, moved and seconded and has not been withdrawn or otherwise disposed of, the instrument shall, for the purposes of sub-sections (8) and (9), be deemed to have been laid before that first-mentioned House on the first sitting day of that first-mentioned House after the dissolution, expiry or prorogation, as the case may be. '(11) Where an instrument to which sub-section (8) applies is disallowed, or is deemed to have been disallowed, under this section, the disallowance of the instrument has the same effect as a revocation of the instrument. '(12) Where- (a) an instrument to which sub-section (8) applies (in this sub-section referred to as the ''relevant instrument'') is disallowed, or is deemed to have been disallowed, under this section; and (b) the relevant instrument revoked, in whole or in part, another instrument to which this section applies that was in force immediately before the relevant instrument came into operation, the disallowance of the relevant instrument has the effect of reviving that other instrument from and including the date of the disallowance as if the relevant instrument had not been made. '(13) Where an instrument to which this section applies comes into force, the Minister shall cause a notice to that effect to be published in the Gazette. '(14) The Minister shall, before 1 July 1984, make at least one instrument to which this section applies under each of the sub-sections referred to in sub- section (1) of this section.'. Page 35, clause 43, sub-clause (3), lines 28 and 29, leave out ', being an instrument that is in force,'. Page 37, clause 45, sub-clause (2), lines 7 to 10 (inclusive), leave out sub- clause (2). Page 37, clause 45, sub-clause (3), line 12, leave out 'Act', insert 'section'. Page 37, after clause 45 insert the following clause: Compensation for compliance with directions under Part II or III '45A. (1) Subject to this section, where a person suffers loss, injury or damage by reason of the compliance by the person with a direction under Part II or III, there is payable to the person by the Commonwealth such amount of compensation in respect of that loss, injury or damage as is agreed between the Commonwealth and the person or, failing agreement, as is determined by a court of competent jurisdiction. '(2) In assessing the amount of compensation payable under sub-section (1) in respect of loss, injury or damage suffered by a person, account shall be taken only of so much of the loss, injury or damage- (a) as is greater than the loss, injury or damage suffered by the community at large, or a substantial part of the community at large, in connection with dealing with, or in preparation for dealing with, a shortage or likely shortage of liquid fuel during a period of national liquid fuel emergency; and (b) as the person is not, and is not likely to be, in a position to make good from the market supplied by the person. '(3) Compensation is not payable under sub-section (1) in respect of loss, injury or damage suffered by a person unless the person lodges a claim for compensation with the Minister within 12 months, or such longer period (if any) as is prescribed, after the loss, injury or damage was suffered. '(4) Any damages or compensation recovered or other remedy given in proceedings that are instituted otherwise than by virtue of this section shall be taken into account in assessing compensation payable in proceedings that are instituted under this section and that arise out of the same event or transaction.' (14) Page 37, clause 47, sub-clause (3), line 42, leave out 'section 45', insert 'section 45 or 45A'. Senator CHANEY(Western Australia-Leader of the Opposition)(6.19) —I have no wish not to see these amendments expedited. In my speech during the second reading debate I acknowledge the positive way that the Minister for Resources and Energy (Senator Walsh), his office, and his Department responded to various matters which were raised with them. Rather than address the merits of these amendments, I suggest to the Committee that the first page of the explanatory memorandum to the amendments be incorporated in Hansard. That will set out the position of the Opposition. I seek leave to incorporate in Hansard the page headed 'Amendments to the Liquid Fuel Emergency Bill 1983' on the basis that I think it accurately sets out the reasons the Opposition has sought amendments to this Bill and why the Government has agreed to them. Leave granted. The document read as follows- AMENDMENTS TO THE LIQUID FUEL EMERGENCY BILL 1983 The Liquid Fuel Emergency Bill was considered by Legislation Committee on 23 August 1983 against the background of Cabinet Decision 1962 (LEG) of 23 August 1983. The Bill was introduced into the House of Representatives on 24 August 1983 and passed on 8 September 1983, without amendment. It received its second reading in the Senate, and debate was adjourned, on 13 September 1983. Amendments Proposals have been received for three amendments. The Leader of the Opposition in the Senate sought changes to: clause 16, to require that, before declaring that a liquid fuel emergency exists, the Governor-General shall have regard to, inter alia, the likelihood of the shortage being averted by the voluntary augmenting of supplies by relevant fuel industry corporations; clause 41 and related provisions, establishing a period of 15 sitting days of each House of the Parliament for disallowance of proposed Guidelines, except during an emergency in which case proposed guidelines would have immediate effect, as do Regulations. Following discussion with the Attorney-General these amendments were agreed on 17 November 1983. The third and principal amendment responds to representations from the oil companies, the Australian Institute of Petroleum and the Leader of the Opposition in the Senate seeking provision for compensation where a company, as a result of acting on a direction of the Minister under the Bill, suffers loss, injury or damage substantially greater than that suffered by the community generally, or sections of the community, in dealing with, or preparing for, a liquid fuel shortage. Directions which may result in such loss, injury or damage may be issued only to relevant liquid fuel industry corporations and the principal source of possible loss identified to date is the power under clauses 12 and 17 to direct the maintenance of fuel reserves. Office of the Parliamentary Counsel have advised that the existing clause 45, providing for ''acquisition of property'' to be on ''just terms'', while necessary and sufficient to meet constitutional requirements, would not necessarily provide the appropriate basis for compensation to be sought in the circumstances identified in representations. The amendment to clause 45 proposed to resolve this issue has been raised in correspondence with the Attorney-General and provided for information to the Prime Minister and the Minister for Finance. All have responded with support for the amendment. A fourth amendment, relating to Clause 3 (Interpretation) is of a minor technical nature only. Amendments agreed to. Bill, as amended, agreed to. Bill reported with amendments; report adopted. Bill (on motion by Senator Walsh) read a third time. Sitting suspended from 6.20 to 8 p.m. Bills received from the House of Representatives. Motion (by Senator Grimes) agreed to: That so much of the Standing Orders be suspended as would prevent the questions with regard to the several stages for the passage through the Senate of the Bills being put in one motion at each stage and the consideration of such Bills together in the Committee of the Whole. Ordered that the Bills may be taken through all their stages without delay. Bills (on motion by Senator Grimes) read a first time. Second Readings Senator GRIMES(Tasmania-Minister for Social-Security)(8.01) —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- Shipping Registration Amendment Bill 1984 The Bill before the Senate will substantially amend the Shipping Registration Act 1981. The Bill, though important to Australia's maritime industry, is certainly not a controversial one. I am hopeful that it will receive bi-partisan approval of senators generally, as was the case with the Shipping Registration Act 1981 which the present Government supported when in opposition. It is appropriate to refer briefly to the reasons for amending an Act which has been in operation for only a little over two years. Honourable senators will recall that the Act enabled Australia to determine conditions for the grant of nationality to ships and replaced the ship registration provisions of a British statute, the Merchant Shipping Act, 1894. Until Australia Day 1982, the registration of this country's ships was subject to British legislation enacted towards the end of Queen Victoria's reign. The Act of 1894 was itself derived from a statute of forty years earlier. The task of enacting a new legislative framework was a formidable one and it was only to be expected that operational experience would demonstrate where improvements can be made. Practical experience gained over the last two years has shown that the administration of the Act can be improved in several respects. The Government is concerned to ensure that the Shipping Registration Office's practices are kept as flexible and as responsive as possible to the commercial obligations of the Australian maritime industry. The proposals to be implemented by this Bill have been referred to the States and the Northern Territory through the Marine and Ports Council of Australia. No objections were raised. Let me now refer to the principal provisions of this Bill. An important change will be the removal of the need to register, and have measured for tonnage, ships of less than 24 metres in length. The Act at present exempts 'small craft' which is defined to mean ships less than 12 metres in length. This stipulated length can lead to problems because of anomalies which arise in relation to individual ships. For example, the owner of a 15 metre harbour-bound tug is now obliged to incur the expense of tonnage measurement and registration, while an 11 metre trading vessel, which plies on the high seas, is exempt from these charges. This expansion of exemptions accords with the International Maritime Organization's International Convention on Tonnage Measurement of Ships, 1969 to which Australia is a party. The Convention does not apply to ships less than 24 metres in length. The elimination of the expenses associated with the compulsory registration and tonnage measurement will therefore benefit the owners of small commercial ships. I should make it clear that ships less than 24 metres will continue to be entitled to be registered for nationality and title purposes or to fulfil the requirements of mortgagees or other third parties with an interest in the ship. A ship outside Australia, when it becomes entitled to be registered under the Australian legislation, must at present at least obtain a provisional registration certificate from a consular officer before leaving a foreign port. A new provision in the Act will allow the Registrar to issue a provisional certificate to any ship entitled to be registered that is overseas or about to proceed overseas. Provisional certificates are of limited duration and are used mainly by owners of pleasure craft. These owners are frequently unaware of international obligations and have not made necessary preparations for registration, often a lengthy process, before an overseas voyage. A further problem identified has been to ensure that the correct markings are placed and maintained on a registered ship. These relate to such matters as its name, official number, registered tonnages and length. The amendments stipulate that a ship will not be registered until it has been marked as directed by the Registrar of Ships. A provision is added to cover the situation of a ship or a share in a ship being subject to two or more mortgages. In future, a mortgagee in possession will, before disposing of the ship, have to notify the Registrar of his intention. The Registrar will be required to give immediate notice to successive mortgagees. Another new provision relating to mortgages will enable discharge where the original mortgage instrument cannot be produced. The Bill will introduce a caveat system into ship registration. These caveats will be similar to those incorporated in State and Territory land title laws. Any person claiming an unregistered interest in a ship or share thereof may lodge a caveat with the Registrar of Ships. The Registrar will notify the owner or owners of the lodgment and, unless otherwise ordered by a Court, the caveat will be deemed to have lapsed 14 days after the caveator has been notified of a proposed dealing with the ship. A provision is included to enable a person who has wrongly sustained damage because of a caveat, to institute legal proceedings for the recovery of damages from the person who lodged the caveat. Another amendment will end the present administrative problem where a ship's registered owner or agent fails to verify any matter relating to the registration of the ship. The new provision will now empower the Minister to direct the Registrar to close a ship's registration where no response is received to a notice. This will also apply where a shipowner fails to reply to a notice published in the 'Commonwealth of Australia Gazette'. The Senate will appreciate that it is desirable to close off obsolete entries in the Register. I am told that the Register, which was taken over from the British authorities, contains a reference to a ship owned by one John Batman, merchant of Melbourne. I think that we can all forgive the Registrar if he has experienced a little difficulty in contacting Mr Batman about his ship. The administrative function of issuing the notice and receiving the reply shall be carried out by the Registrar. The decision as to removal of an entry from the Register will continue to be one for the Minister. A further amendment will clarify the application of another old British Act ( Admiralty Court Act, 1861) in order to ensure that an aggrieved mortgagee is able, under that Act, to have a mortgaged ship arrested if the ship is subject to the Shipping Registration Act. Other provisions of the Bill relate to: the clarification of the meaning of ''Australian national'' in relation to persons and bodies corporate who wish to register a ship on long-term charter; the inclusion of a specified time limit for the lodgement of various documents required by the Act; the strengthening of the requirement for a ship to have a registered agent with an address in Australia. The other amendments to be made by this Bill relate to technical and administrative matters. These provisions are described in an explanatory memorandum which is being circulated to honourable Senators. I should explain that the financial implications of the proposed amendments will be minimal. The small commercial ships which this Bill will exempt from registration requirements, oil pollution levy and lighthouse dues contribute less than 1 per cent of the total revenue derived from these imposts. The basis of exemption from these charges will be altered from the tonnage to the length of a ship. This change may exclude some ships now liable for those payments but any loss of revenue will be largely offset by reduced administrative expenses. I commend the Bill to the Senate. Protection of the Sea (Shipping Levy) Amendment Bill 1984 This Bill is complementary to the Shipping Registration Amendment Bill 1984. It is required in consequence of an alteration to the requirement for tonnage measurement of ships. At present, the Protection of the Sea (Shipping Levy) Act 1981 applies the levy to any ship exceeding 100 register tons. The Shipping Registration Amendment Bill 1984 proposes to exempt all ships under 24 metres in length from the necessity to register. It is intended that the Shipping Registration Regulations will exempt ships under 24 metres from the necessity to be measured for tonnage if they are registered voluntarily. Because ships under 24 metres would no longer have evidence, in the form of a tonnage certificate, of their tonnage for the purposes of the Protection of the Sea (Shipping Levy) Act 1981, it is proposed to amend the Act so that it will apply only to the same ships to which the compulsory registration provisions of the Shipping Registration Act 1981 and the compulsory measurement provisions of the International Convention on Tonnage Measurement of Ships, 1969 apply. I commend the Bill to the Senate. Debate (on motion by Senator Kilgariff) adjourned. Bill received from the House of Representatives. Ordered that the Bill may be taken through all its stages without delay. Bill (on motion by Senator Grimes) read a first time. Senator GRIMES(Tasmania-Minister for Social Security)(8.03) —I move: That the Bill be now read a second time. I seek leave to have the second reading speech incorporated in Hansard. Leave granted. The speech read as follows- This Bill proposes to amend the Automatic Data Processing Equipment Bounty Act 1977 to extend the period of that Act until the Government announces its decision on the longer term assistance arrangements to apply to the computer hardware, software and related industries. The Act, due to cease on 28 March 1984, provides bounty assistance to the production in Australia of certain ADP equipment and parts at the rate of 7.5 per cent of the value added in Australia by ADP equipment manufacturers. The Government received the Industries Assistance Commission's final report on these industries on 10 February 1984 and expects to be able to announce its decision by 6 May 1984. In the absence of extended bounty assistance, the computer industry would have been left with minimal assistance. This would have placed the industry in a difficult position, particularly in tendering for contracts during the intervening period. The proposed extension of the bounty scheme is therefore intended to create a stable environment within which the industry can continue to operate. The Government recognises the importance of ADP equipment manufacture in Australia. This industry and the computer software industry are considered to be activities that can improve the competitiveness of Australian manufacturers and commerce generally. The Government's decisions on these important industries will take into account these factors and the close inter-relationship with other industry sectors, including robots and metal working machine tools. The cost of the extension of the ADP bounty until 6 May 1984 is expected to be less than $200,000. I commend the Bill to the Senate. Debate (on motion by Senator Kilgariff) adjourned. Debate resumed from 29 February, on motion by Senator Grimes: That the Bill be now read a second time. Senator CHIPP(Victoria-Leader of the Australian Democrats) —by leave-By arrangement with the Australian Labor Party and the Liberal Party, we thought this would be the most expeditious way of discussing briefly the notice of motion I have on the Notice Paper, No. 33 on page 2923, before the debate on this Bill ensues. On 2 March I presented the following notice of motion: 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. In moving the motion later I quoted, with the authority of the former Treasurer, some parts of a memorandum dated February 1980 from the then Commissioner of Taxation to the then Treasurer, which, not to put too high a point on it, suggested that at that time, namely, February 1980, firstly, there were more urgent aspects of tax avoidance to be tackled and, secondly, there seemed to be no evidence that there had been massive evasion of tax through the scheme which this legislation sought to arrest. Therefore, I, with my Party and with the support of the Opposition, believed it was reasonable, if in February 1980 it was not considered by the then Commissioner of Taxation to be an urgent matter, to ask why clause 5, I think, of this Bill dates the legislation back to 1 July 1977. I think that is the crux of the matter. Therefore, I put down that notice of motion asking the Treasurer (Mr Keating) to produce that information. Today I received from Senator Walsh, who represents the Treasurer in this chamber, a letter from the Treasurer to him dated 5 March 1984 in which the Treasurer predictably said, for what in the past were regarded as good reasons by the Liberal Party when it was in government, that he could not comply with that request of the Senate and will not do so because of the long-established convention that these matters, namely, the advice of a public servant to a Minister, should not be disclosed. The Treasurer then gave some reasons why the Government felt impelled to insert clause 5 in the legislation. For the sake of the record I seek leave to have this letter from the Treasurer to Senator Walsh dated 5 March incorporated in Hansard. Leave granted. The letter read as follows- Treasurer PARLIAMENT HOUSE CANBERRA 2600 5 March 1984 Senator the Hon. Peter Walsh Minister for Resources and Energy Parliament House Canberra, A.C.T. 2600 My dear Senator I refer to our discussion on Friday afternoon concerning the motion moved by Senator Chipp calling for the tabling of documents containing advice to the Government by the Commissioner of Taxation as to the need for the measures contained in clause 5 of the Income Tax Assessment Amendment Bill (No. 5) 1983. The Government is not prepared to table all documents received from the Commissioner of Taxation tendering advice to it in relation to this matter. These include Cabinet and other materials which are properly kept confidential. The former Treasurer asserted during the debate in the House of Representatives that he had received advice from the Commissioner of Taxation just before the change of Government to the effect that Part IVA had wiped out all blatant, artificial and contrived tax avoidance schemes and that therefore these particular superannuation practices could not be in that category. On this premise Mr Howard claimed that the practices could not therefore meet the criteria necessary to satisfy the Government's retrospectivity policy confirmed by the Minister for Finance in his statement of 28 April 1983. By long established convention the Commissioner of Taxation cannot inform me what particular advice he tendered to the former Government, but I have no reason to doubt that the former Treasurer quoted accurately from written advice he received from the Commissioner. Of course, the particular context in which the Commissioner made his remarks may place a different emphasis on them than did the former Treasurer in his speech. I think, however, that what the Commissioner had in mind when giving his advice to the former Government just prior to the election was those schemes which were known as ''paper schemes'', that is those which were quite artificial and, in reality, devoid of any fiscal effect other than the attempted avoidance of tax. If that, as I suspect, was the case, then there is nothing inconsistent with the Commissioner's advice to me and to the former Government in relation to these particular superannuation tax avoidance schemes. they are not of the extremely artificial variety, nor are they of a kind at which Part IVA was directed. That does not, however, mean that they are not blatant or contrived or even artificial in terms of the application of the Government's policy on retrospective tax amendments. In the Government's view they are clearly in that category of schemes which we intended would be covered by Mr Dawkins' statement on the Government's retrospectivity policy. Mr Dawkins' statement specifically referred to schemes which might not be caught by Part IVA. Not only are they of a most blatant kind, but they contain elements of fraud against employees, many of whom stood to benefit from many years' membership of a superannuation scheme which has been afforded substantial taxation benefits. The Government's retrospectivity policy was clearly not intended to operate only against purely paper schemes. The nature of the schemes in question was set out in my press statement of 14 November 1983 (copy attached). During the debate on the Bill in the House of Representatives, I drew attention to a judgment by Mr Justice Wootten which vividly described the type of scheme involved. One of the employees in that case was sacked on a Friday, re-employed as a casual on the following Monday and, as a result, denied a superannuation entitlement of over $53,000. If Opposition Senators do not regard schemes of that kind as blatant or contrived, then that is a view I cannot share. The decision to propose that the measures in clause 5 should have a retrospective operation from 1 July 1977 was taken by the Government after full consideration of the nature of the schemes, and after noting the essentially fraudulent nature of the activities involved, both in relation to employees of the business concerned and the revenue. The overall monetary effect on the revenue was not the critical consideration, given the unsavoury nature of the practices involved. I am confident that our decision to propose that the legislation be made retrospective was the correct one in this case and the Government proposes to press ahead with the Bill in its present form in the Senate. Yours sincerely P. J. KEATING I have under my own hand circulated to the Leader of the Opposition (Senator Chaney) and Senator Dame Margaret Guilfoyle a copy of that letter, albeit just before the dinner suspension. I hope that I did not offend any confidentiality, but Senator Walsh did not indicate that any confidentiality attached to the letter. So the Opposition is armed at least with the reasons given by the Treasurer. I can understand the Treasurer's hesitation in not tabling documents received from the Commissioner because they include Cabinet material properly kept confidential. However, in this instance I believe the Treasurer could well have made an exception and would have been wiser had he done so. The Government is attempting to introduce this legislation retrospectively to 1977. Even those in this chamber who favour retrospective legislation-and they do not include me, Senator Haines or Senator Macklin-would realise that it sets dangerous precedents and undermines the rule of law. Therefore, they must be prepared to make out a very good case as to why legislation should be made retrospective. The Government's case for retrospectivity in this instance has been brought into question by the former Treasurer's statement in the House of Representatives on 29 February that the advice that he received from the Commissioner of Taxation in 1980 indicated that this type of tax avoidance was not a major problem then and that an attempt to remedy the situation might create many problems for the large number of funds that are completely genuine and, therefore, for the many small businesses that operate them. As I said in my speech the other morning, we have suffered an economic downturn in this country. Let us consider what would happen with a small business that had genuinely started a superannuation fund for its 20 employees, including the directors and, through the business having gone badly because of the recession 14 of them, say, had been sacked, for very good legal and proper reasons, and then finally the business had gone into liquidation and the superannuation fund had to be wound up. As I understand it, according to the definition in this legislation, the residual beneficiaries of that fund would have received 'an excessive benefit'. Because they have received a benefit, this legislation will give the Commissioner of Taxation power to deem that they have received an excessive benefit and to tax them in the year in which they receive that benefit or the year in which it accrues to them. He would deem that to be income and that would be assessed, in many cases, at the marginal rate of over 60c in the dollar. Today we received firm positive assurances from a senior officer of the Australian Taxation Officer, which gave me a great deal of satisfaction, that this would not be the Commissioner's intent, and that the Commissioner will be zealous in applying this Act only in those cases which he regards as barefaced, where an obvious attempt was made way back in 1977, or since then, to avoid taxation by a totally artificial scheme. I respect and believe everything that that officer said to Senator Jack Evans, Senator Macklin and myself in Senator Walsh's office. We just express the view, the five Australian Democrats, that while we honour that sort of assurance and respect it from a respected taxation officer, we would prefer it to be written into the legislation to give that sort of safeguard to the genuine cases. The officer went on to say that the aggrieved taxpayer can well appeal against the use of the Commissioner's discretion, either through a board of review or, sometimes, a court. But he acknowledged when I pointed it out that, under our taxation law, at that point of time the taxpayer has the onus on him to prove that he was innocent of any misdoing. I have already quoted in this chamber from the document which the Commissioner of Taxation furnished to the then Treasurer. It seemed to me to require a similar response from the Treasurer showing us why the Commissioner had now brought further evidence that the proposed section 26 AFA ought to be made retrospective to 1 July 1977. The Treasurer has not given me, therefore, an adequate response to evidence that fundamentally undermines his case for retrospectivity in this instance. I have some sympathy with what the officer said to us today: That a great number of these schemes were entered into by employers as far back as 1977 but at the time the then Commissioner of Taxation gave the then Treasurer, Mr Howard , the memorandum the mischief had not surfaced-namely, the employers acted on the advice of those despicable creatures who live on the fringe of the accountancy and legal professions and who make a living out of advising people how to go into these schemes. Senator Hill may laugh, but I hope that he joins me, as a distinguished lawyer himself, in condemning those despicable creatures who live on the fringe of his profession, the legal profession, and of the accountancy profession, who make a fortune out of the tax avoidance industry. They were advising their clients to go into these schemes in 1977, but to make them look fair dinkum until about 1982-83. Senator Hill —But that is very rare. Senator CHIPP —What is rare? Senator Hill —It was very rare that an accountant or a lawyer advised anyone to go into a scheme of that nature and make it look real. Senator CHIPP —Senator Hill must be talking with his tongue in his cheek in saying that. As a former member of the accountancy profession, I often cringe with shame at some of the advice that I hear is given to taxpayers by qualified accountants in relation to schemes which, when I practised accountancy, I would not have touched with a 40-foot pole. Senator Hill —What I am saying is that it has to be put in its right perspective . They are very rare exceptions, advising people to enter into totally artificial schemes. Senator CHIPP —I admire the stand that Senator Hill takes against retrospectivity. I am still against retrospectivity. I do not want that to be misunderstood. However, if Senator Hill were to have a discussion with the admirable taxation officer with whom we spoke today, I am sure that he would be persuaded that many wilful schemes were entered into on the advice of crooked lawyers and crooked accountants in 1977 which did not become manifest as rorts until 1982-83. That is the excuse, apparently, that the present Government uses to date this legislation back to 1977. It is a plausible excuse. If one believes in the principle of retrospectivity, it is a reasonable excuse. I will not have a bar of the principle of retrospectivity at any price. Therefore, notwithstanding how good the reason is, I reject it. To complete this matter, at about five minutes to eight-I say this with no criticism of Senator Walsh-Senator Walsh handed me a letter addressed to the Treasurer, dated 6 March, from the Acting Commissioner of Taxation, Mr Boucher, pertinent to the point. I have not even had time to make a copy to give to my friend and colleague Senator Dame Margaret Guilfoyle. It would have been extraordinarily valuable had this letter been circulated to the Opposition before the debate proceeded. Senator Walsh —That will be done shortly. Senator CHIPP —Perhaps Senator Walsh will make the arrangements. I do not know whether the Government can delay this debate for a quarter of an hour so that Opposition senators can look at the letter before they speak. It contains some pertinent facts. The Commissioner states that the practices are 'brazen and barefaced' and involve 'abuses of the tax law', and so on-with which the Australian Democrats agree. I think that Liberal senators agree about that. We agree with this legislation. The only part of the legislation with which we disagree is its retrospective aspect. Senator Harradine —What is meant by 'abuses of the tax law'? Senator CHIPP —The Commissioner does not go on- Senator Messner —He uses the word 'artificial'? Senator CHIPP —Yes, and I am persuaded that this is an artificial practice which ought to be stamped out, and therefore I agree with the thrust of what the Government is trying to do. Senator Watson —Not in all cases. Senator CHIPP —Before Senator Watson came into the chamber, I had been at pains to cover those aspects about which he now says 'not in all cases', and I absolutely agree with him. We were assured today by a senior officer of the Taxation Office that the genuine cases will not be touched by this legislation. In response to that, I then said that I would prefer to see those safeguards written into the bill rather than being left to the Commissioner's discretion. So Senator Watson and I are at one. Senator Hill —Why cannot the assessment simply be overcome by section 172? Senator CHIPP —I am informed that the assessments of those years-say, between 1977 and last year-cannot be reopened because the payments by the employer into the fund constituted at that stage genuine premiums on behalf of employees. The only assessment that can be reopened, as I understand the information given today, is that which was made in the year in which the rort was discovered or deemed to be discovered by the Commissioner. That is the reason given to me. It is a pity that this valuable advice from the Commissioner will not be available to people such as Senator Dame Margaret Guilfoyle, Senator Hill and Senator Watson before the debate ensues. Senator Walsh —It will be soon. Senator CHIPP —I thank the honourable senator. With the authority of Senator Walsh, I seek leave to have this letter also incorporated in Hansard. Leave granted. The letter read as follows- 6 March 1984 The Treasurer,Parliament House,Canberra, A.C.T. 2600 INCOME TAX ASSESSMENT AMENDMENT BILL (NO. 5) 1983 You have asked that I provide you with further advice as to the nature of the practices against which clause 5 of the Bill is directed and, in particular, whether they can be categorised as blatant and contrived. In terms of general usage, as I understand it, they can-as I now explain- be so described. We have a situation where a superannuation fund has been set up ostensibly for the benefit of the employees of a particular firm. The fund is governed by a trust deed the terms of which will have been looked at by the Taxation Office with a view to ensuring its compliance with the law, section 23F in particular. Tax-deductible amounts will have been contributed by the employer for the employees, both those who are proprietors and those at arm's length. The contributions will have been invested and income from the investments accumulated tax-free. What then happens is that steps are taken with a view to moneys in the fund being re-directed, solely to those employees who are proprietors of the business . This re-direction involves the premature dismissal of the arm's length employees and is either in breach of the trust deed or involves the payment of benefits far in excess of permissible levels. That kind of thing involves clear elements of raids against the revenue and also against the unsuspecting ordinary employees concerned. It may well have been that there was this intention from the outset, but if that is so the intention is one that is kept masked from ordinary employees and the Taxation Office. The practices seem to me to be brazen and bare faced and involve abuses of the tax law which, in the superannuation area, contains generous concessions intended for the benefit of the employees on whose behalf contributions are supposed to have been made. The arrangements are ingeniously planned to give the appearance of bona fide superannuation arrangements. In providing this advice, I am aware of the comments made by the former Treasurer in the course of debate in the House of Representatives. As you would appreciate, there is difficulty in my providing you with comments on or explanations of advice given to the former Government by the Commissioner on the matter. It is, I hope, enough for me to say that, when the advice that Mr Howard has referred to is read in its context, it is not at variance with the advice now provided. As to the revenue effect of the proposed measures, identified cases of the kind to which clause 5 applies, involve revenue of some $15m. T. P. BOUCHER Acting Commissioner of Taxation Senator CHIPP —I thank the Senate for its indulgence. I have no standing in this situation. I am speaking by leave and with the indulgence of the Senate. I do not know what Senator Walsh's view on this matter is but I think that this information is so crucial to an intelligent debate that the debate ought to be delayed for at least a quarter of an hour. If the Government has any other business perhaps it could be called on. Senator WALSH(Western Australia-Minister for Resources and Energy) —by leave-I do not want to make a second reading speech on this matter but there are a number of matters which I think I ought to try to explain and clarify. The first item before the Senate relative to the Income Tax Assessment Amendment Bill (No. 5) 1983, as I understand it, is the motion that Senator Chipp moved the other day. Senator Chipp —No, that is not before the Senate. Senator WALSH —It is not before the Senate? Senator Chipp —Not at the moment. Senator WALSH —I would like to make a couple of comments about that, anyway. As Senator Chipp has explained, he sought to obtain all or at least a substantial part of the memoranda and advice which the Commissioner of Taxation has provided to the present Treasurer (Mr Keating) on this question. The Treasurer has refused to make that information available except in a very limited form-I will come to that later-first, on the grounds that there is no precedent, with one exception to which I will return later. Indeed, there is an objection in principle to advice of this nature being tabled in the Parliament because if that became a standard practice, the Commissioner of Taxation and a number of other public servants would be very seriously constrained in the advice they could give to a Minister or to a government. Secondly, I am advised that the first communication that the present Treasurer received from the Commissioner on this matter was in the form of a draft Cabinet submission. I do not think anyone would suggest that draft Cabinet submissions, under the Freedom of Information Act or anything else, ought as a matter of practice to be made available to the Parliament. Thirdly, in the memoranda that the Treasurer has received from the Commissioner of Taxation a number of matters were normally canvassed-perhaps five or six separate issues-one of which may be this issue. Fourthly, those same memoranda frequently contained discussion or suggestions-speculation perhaps-as to tax legislation which the Government may consider contemplating not only in respect of these cherry picker schemes which are the subject of a portion of the Bill but also in respect of other matters. The letter written by the Treasurer to Senator Jack Evans on 1 March which Senator Chipp has had incorporated in Hansard explained- Senator Chipp —No. Senator WALSH —The honourable senator has had the letter of 1 March incorporated , has he not? Senator Chipp —No, only the letter from the Treasurer to you of 5 March. Senator WALSH —I am sorry; I have that wrong. A letter was written to Senator Evans on 1 March-copies of it, I think, have been provided to the Opposition-in which the Treasurer explained the basic reason why legislation is required to deal with these cherry picker schemes. That basic reason is that superannuation funds are established and contributions are made to them, usually exclusively by employers, but those funds can continue for a number of years. The employers claim deductions from their taxable income for the employer contribution and the earnings of the funds, as is the case with all superannuation funds, are exempt from taxation in the hands of the fund. Under the existing law, only in the last year of a fund, that is, when it is improperly wound up or terminated in a way that seeks to advantage the manipulators of the fund or the owners or managers of the company and not the employees for whom it was ostensibly established, may the Commissioner disallow the deductions claimed by the employer, who is the ultimate beneficiary in most cases of these types of artificial schemes of the taxation exemption for the employer contribution. The existing law does permit the Commissioner to go back and deny exemptions in all of the previous years for which exemptions or deductions from the employer's taxable income has already been allowed. I note-I think this is important, even though it is perhaps more of a second reading debate matter-that the former Treasurer, the honourable member for Bennelong (Mr Howard) in the House of Representatives on 29 February quoted from a letter or a memorandum sent to him just before the last Federal election by the Commissioner of Taxation. He quoted the Commissioner as having said: Firstly, as a result of your new Part IVA all the blatant artificial and contrived schemes are a thing of the past. An amendment was also moved by the Opposition in the House of Representatives, and notice of the same amendment has been given here, to provide that the date from which this provision becomes operative, stated in the Bill as 1 July 1977, be altered to 7 December 1983. In other words, the Opposition has argued by way of that amendment that there should be no retrospective application of this law and has simultaneously argued in quoting the Commissioner that 'all blatant artificial and contrived schemes are a thing of the past' following the proclamation of Part IVA. It seems to me that it follows that the Opposition has declared total opposition to legislation with retrospective application-even though I note in passing that that inhibition was not apparent among the same people in 1982-and also argues that the legislation presently before us is superfluous following the proclamation of Part IVA in 1982. The only logical outcome of those two propositions-I hope I have interpreted them correctly; I certainly have not intentionally misinterpreted them-is that the Opposition ought to be opposing the entire section of the Bill and not just seeking to alter the date on which it becomes relevant. Senator Chipp commented on the letter from the Commissioner to the former Treasurer written in February 1980. I would like to add a couple of comments. First, that letter from which he quoted, I think on Thursday of last week, was written in early 1980 when the Commissioner's top priority from the documents which had been tabled in 1982 by the former Treasurer, among other sources, was clearly to terminate the bottom of the harbour schemes. At that time the Commissioner gave a relatively low priority to the schemes at which the relevant section of the Bill before us is aimed. Since that period, however-this is additional-- Senator Chipp —He also said most of them appeared to be genuine. Senator WALSH —Yes, I was coming to that. A great deal more evidence has come to the Commissioner's notice since that time. A particular and very blatant case- the Kelly v. Raymor case upon which Mr Justice Wootten delivered a verdict on 18 November 1982, a copy of which has been circulated to all honourable senators- showed how blatant some of these schemes were. There have been some Federal police investigations and the Commissioner or the Australian Taxation Office also believe that as a result of the proposals and later policy of the present Government to alter the tax arrangements for lump sum superannuation payments, a number of those schemes have been wound up. In other words, the importance of these schemes, as a result of later evidence coming to light, is much greater than the Commissioner had believed at the time he wrote that letter to the former Treasurer in February 1980. I should like to refer to one paragraph at the end of the letter dated 6 March 1984, which I think Senator Chipp has incorporated, where the Taxation Commissioner, writing to the Treasurer, says: In providing this advice, I am aware of the comments made by the former Treasurer in the course of debate in the House of Representatives. As you would appreciate, there is difficulty in my providing you with comments on or explanations of advice given to the former Government by the Commissioner on the matter. I interpolate that I am sure we are all aware of that problem. The Commissioner continues: It is, I hope, enough for me to say that, when the advice that Mr Howard has referred to is read in its context, it is not at variance with the advice now provided. The advice now provided in that same letter says, among other things, in a description of the type of funds at which this section of the Income Tax Assessment Amendment Bill (No. 5) 1983 is aimed: We have a situation where a superannuation fund has been set up ostensibly for the benefit of the employees of a particular firm. The fund is governed by a trust deed the terms of which will have been looked at by the Taxation Office with a view to ensuring its compliance with the law, section 23F in particular. Tax-deductible amounts will have been contributed by the employer for the employees, both those who are proprietors and those at arm's length. The contributions will have been invested and income from the investments accumulated tax-free. The letter goes on to state that what then happens is that the employees who are ostensibly the beneficiaries of the fund are in one way or another deprived of their entitlement. The entire proceeds are ultimately distributed to the effective managers of the fund, usually the owners of the company. I should like also to refer to the Treasurer's 5 March letter which Senator Chipp incorporated. This is a letter from the Treasurer to me and which I had previously made available to the Australian Democrats and the Opposition. The Treasurer says: I think, however, that what the Commissioner had in mind when giving his advice to the former Government just prior to the election was those schemes which were known as 'paper schemes', that is, those which were quite artificial and, in reality, devoid of any fiscal effect other than the attempted avoidance of tax. Schemes of that type are virtually one-day round-robin schemes in which cheques are handed around and claims are made for deductions from taxable income for contributions to a fund and the money is paid out on the same day. They are a quite different type of scheme from those at which the legislation presently before the Senate is aimed. The schemes at which this legislation is aimed have in all cases been in existence for a number of years. They have operated more or less in a normal way, with the exception that the employees rarely made any contribution. The employees were frequently ignorant of the existence of the scheme. Contributions were accumulated over a number of years and those contributions earned interest and compounded. The schemes only became clearly fraudulent at the time they were wound up or at the time that various devices were employed to defraud the employees, for whom the schemes were ostensibly established, from their entitlements. The Treasurer goes on in the 5 March letter: If that, as I suspect, was the case, then there is nothing inconsistent with the Commissioner's advice to me and to the former Government in relation to these- I interpolate, 'these' being those schemes which are covered by this Bill- particular superannuation tax avoidance schemes. They are not of the extremely artificial variety, nor are they of a kind at which Part IVA was directed. I am afraid that this is a very complex issue. If I have explained it imperfectly I apologise. It is difficult, even after one has spent some time studying it. In summary, the legislation presently before the Senate is essential in order to recover the tax deductions improperly claimed on schemes which were wound up between 1 November 1977 and May 1981, when Part IVA of the principal Act was proclaimed. It is also probably necessary to recover tax on deductions improperly claimed in that post-May 1981 period for the reasons that Treasurer gave in that 5 March letter to which I have just referred. That is, the schemes at which this legislation is aimed are not of the kind at which Part IVA was directed. It may be arguable that Part IVA could recover the tax improperly evaded through the manipulation of these schemes following proclamation of Part IVA, but I am advised that there is no certainty that that could be done. Finally, Senator Chipp asked a couple of questions towards the end of his speech about the operative date for the legislation, that is, 1 July 1977, and the reason for it. The reason is that the first instance known to the Taxation Commissioner, not of the existence of funds of this type but of the disgorgement of benefits from those funds in an improper way, was in August 1977. Senator Harradine —What do you mean by 'an improper way'? Senator WALSH —A way in which the employees of the company, for whose benefit ostensibly the fund was established, are deprived of their entitlements in that fund and the contributions on which exemption from taxable income has already been claimed and on which income earned within the fund has been tax exempt, are ultimately directed or harvested, if you like. I understand that the colloquial term is 'cherry-picked'. Senator Chipp —Cherry what? Senator WALSH —The cherries are ultimately picked by the managers of the fund, who are usually the owners of the company, the employers. Senator Harradine —That is the problem that ought to be solved, is it not? Senator WALSH —That is what the legislation will do. Senator Harradine —No, it does not do that. The employee gets nothing and the Taxation Office get everything. Senator WALSH —In most cases the employee was not aware of the existence of the fund. These are artificial, contrived, blatant schemes, the intent of which was at all times to defraud the Taxation Commissioner of revenue. Senator Harradine was not in the chamber yesterday so he may not have had an opportunity to read Mr Justice Wootten's judgment, which I circulated to most honourable senators initially last week and finally yesterday. Under this legislation the employer is required to pay tax on the contributions to the fund which were allowed on the presumption that the employee would benefit from the fund. Since the employee does not benefit from the fund the rationale for the original tax exemption disappears. It is that fraudulent intent by the managers of these funds which this legislation sets out to correct. Senator Harradine —I will be moving an amendment later. Senator WALSH —Well I dare say the honourable senator will move any amendment which he thinks will protect tax evaders; he has habitually done so in this place. Finally, the estimate of revenue which is contained in the last sentence of the letter which Senator Chipp has tabled is at this stage $15m. That is a minimum figure and the ultimate figure could-although this is getting into the realm of speculation-be a great deal higher than that. Senator HARRADINE(Tasmania) —by leave-This statement follows the statement made by the Leader of the Australian Democrats, Senator Chipp, and the statement made by the Minister for Resources and Energy, Senator Walsh. I am disappointed that the motion by Senator Chipp for all of the information to be supplied from the Australian Taxation Office has not been successful. I, like Senator Chipp, do not wish to impugn public servants because they are dedicated officers, but what we want to see is the actual advice that is given and the detailed information on which this advice has been formed. We do not have that. We have some examples -- Senator Dame Margaret Guilfoyle —One example. Senator HARRADINE —We have one example. We do not have other examples. I reiterate that what the Government is doing here is virtually saying: 'Well, there have been these schemes. They have been devised improperly'. That is why I asked Senator Walsh what he meant by the word 'improperly'. He said that ' improper' in that context meant that employees who were supposed to be the beneficiaries of these schemes have been deprived of the benefits and those benefits have been cherry-picked by the managers of the schemes. The answer of the Government to that problem is: Tax the cherry-pickers. Well, where does that leave the employees? Where does that leave the workers who have been deprived of the benefits of these particular superannuation fund schemes? It is no satisfaction at all for them to see the Taxation Office get a bit of extra money . I would have liked to have had, and expected to have had, the benefit of further information which would be available to the Commissioner of Taxation and which would now be available to the Senate if Senator Chipp's motion were adopted. Failing that information I am proposing an amendment to the motion for the second reading of the Bill, most certainly not for the purposes about which Senator Walsh has made comment, but to ensure that those who have been deprived of the benefits are, in some way, compensated for the loss of those benefits. There are various ways of doing this. Senator Walsh said that the employees in many cases did not know of the existence of the superannuation fund. That is very true. I know that for a fact. Senator Watson —Every trustee should know. There is a requirement that the Commissioner will approve, that every trustee must be informed. Senator Archer —Only if he contributes. Senator HARRADINE —No, it is not only if one contributes. The Taxation Office will inform one that in the appropriate forms there must be, as I understand it, a provision which refers to the fact that the beneficiaries, the employees covered, have been advised of the existence of the schemes. As I understand it- the Minister can correct me if I am wrong-that is the situation. Senator Elstob —They are all supposed to be advised about all the dangerous chemicals and those sorts of things, but you know they are not. Senator HARRADINE —The point I am making is that here is a situation where we have had the managers of the scheme acting-I do not know whether fraudulently is the word-- Senator Dame Margaret Guilfoyle — Improperly. Senator HARRADINE —Certainly acting improperly and the workers who are supposed to be the beneficiaries getting nothing. They are still going to get nothing if we pass this legislation. Therefore, I will now have to retire and consider what will be the appropriate amendment to the second reading motion so as to ensure that the workers get something, and not just the Taxation Office. Senator Dame MARGARET GUILFOYLE(Victoria)(8.48) —The Income Tax Assessment Amendment Bill (No. 5) does a number of things with regard to taxation proposals . I do not wish to make any long comment on some of those issues. Such things as the withdrawal of the investment allowance where property is used in tax exempt activities, leverage leasing about which I would like to have time to say something, special concessions for Australian trading ships, deductions for investment in qualifying Australian films and exemption of payments of special benefits to victims of major disasters are, in many cases, tax issues that have been announced either in whole or in part by the former Government or have been the subject of Budget announcements or other announcements by Ministers of the present Government. There are three matters to which I would like to address some attention. One of the matters is that which we have been discussing since 8 o'clock this evening, that is, the tax avoidance practices in relation to employees' superannuation funds. Our interest in this matter started with the debate in the House of Representatives in which the shadow Treasurer moved an amendment on behalf of the Opposition relating to the retrospectivity of the proposal before us. The matter has been developed further in the Senate by Senator Chipp's motion requiring information from the Treasurer (Mr Keating) with regard to the advice that he had received from the Commissioner of Taxation. It will be recalled that the shadow Treasurer in the other place made reference to his advice from the Commissioner in 1980 and then later in 1983 with regard to matters of tax avoidance or legislation that may have been required by the then Government. With regard to employees' superannuation funds, about which we have been talking , there are some queries in my mind arising from what has been said this evening . I have now the benefit of the letter from the Treasurer to Senator Walsh of 5 March. The advice that he has- Senator Walsh —I am sorry, did you not have that before? Senator Dame MARGARET GUILFOYLE — I had the letter of-- Senator Walsh —The letter of 5 March. I though you had it yesterday. Senator Dame MARGARET GUILFOYLE —Yes. I said I have the benefit of that letter. I have it here. The letter that I had earlier was the one dated 2 March which Senator Walsh addressed to me and which gave the judgment of Justice Wootten. Senator Chipp made available to me this evening the letter to Senator Walsh from the Treasurer dated 5 March. We now have the further letter from the Commissioner to the Treasurer dated 6 March. It was made available this evening. Senator Walsh —I am sorry, I meant to give you the letter of 5 March. Senator Dame MARGARET GUILFOYLE — I did not have that one earlier. However, I have been able to read what was in that letter. The thing that has confused many of us is the lack of information as to the need for the proposals that are now before us. If we look at the existing tax Act, with regard to section 23F funds we find that what is now before us to counter tax avoidance seems to lack some continuity. If we look at the tests that are made by the Commissioner to determine whether funds are properly section 23F funds, we must wonder why the Commissioner could not simply deal with the tax avoidance that we are now discussing under the Act as it exists. Proposals and tests are applied as to whether the funds are genuinely set up for the benefit of the employees and the trust deeds are such that if at any time the payments are not in accord with them the Commissioner may act. What we want to know precisely is why it is thought that the Taxation Commissioner could not operate under section 23F with regard to abuses that are now referred to. Senator Harradine made statements with regard to the employees not gaining benefit. I can understand that a tax amendment Bill may not be the place in which such benefits would be protected. But it is known that the industrial commissions in the States can order the payment of entitlements to employees under some of the legislation which now exists, particularly the New South Wales Employment Protection Act of 1982. Those matters would relate to some of the things that were referred to by Senator Harradine earlier tonight. But in the case of a proper section 23F fund I would want to have absolutely precise information as to why the Commissioner feels that he needs to reach back to 1977 in order to deal with a payment improperly made out of that fund at any particular time, and why he would need to go back to 1977 when a fund fails to meet the test at any point of time. The Commissioner may determine that that fund is not an exempt section 23F fund for the income year. In circumstances where the Commissioner contends that blatant tax avoidance has occurred, or that fraud upon the revenue and unsuspecting employees has taken place, it is open to the Commissioner to contend that the fund was not a section 23F superannuation fund and had never been such. As such, all contributions to the fund which had been deducted from the employer could be disallowed. Senator Walsh said earlier tonight that that would not be the case; that he could only refer to the last income year in which the abuse of the fund had been detected. I would wonder why the Commissioner would not look at some of his powers to disallow deductions which had been granted to the employer in cases where the discretion of the Commissioner, exercised at the time, is considered erroneous. We would want to know why the power contained in section 170 (8) could not be used at any time that there had been a payment in abuse of the trust deed of a particular fund. Senator Walsh —I am sorry; what power is that? Senator Dame MARGARET GUILFOYLE — I refer to his power under section 170 (8). In cases in which deductions had been erroneously granted by him, he should be able to use that power instead of requiring a new power under the provisions that are before us. After all, the determination of whether it is a section 23F fund is subject to very precise tests by the Commissioner. The Commissioner has the power to look at those funds to determine whether they are superannuation funds set up for the benefit of employees. That would include investigating the work and non-working directors and their dependants. A fund would not qualify for exemption unless it satisfies the tests which are prescribed in section 23F (2). In particular, the fund must be indefinitely continuing and must be exclusively established and maintained to provide benefits for the employees and/or for the payment of death benefits to their dependants. That would come under the sole purpose test of section 23F (2) (a). Further benefits being provided by the fund for any employee must be reasonable, having regard to a number of factors considered relevant by the Commissioner. That is provided under section 23F (2) (i). Unless the benefits being provided are considered reasonable, the employees ' fund will not qualify for exemption under section 23F. In regard to the failure of any of the tests that the Commissioner may use at any time to determine the proper use of section 23F funds, it is of interest to me to hear further argument on why the Commissioner needs these retrospective powers to deal with a particular case, only one of which has been referred to us , the judgment that was given by Justice Wootten. As I understand it, that case was subsequently settled. There was a family argument within a company and it quite blatantly contravened section 23F. As I understand it, it was settled. I regard this judgment as being no substantiation of the requirment to go back to 1 July 1977 to prove the new powers which the Commissioner now seeks. Senator Walsh read some parts of the advice that was given to the former Treasurer with regard to Part IVA and blatant and contrived schemes. I am interested in this because one minute these schemes are being called blatant and at another it is said that they could not be caught under Part IVA. It would be one thing if Senator Walsh was talking about the period from 1 November 1977 to 1981 when Part IVA was included in the Income Tax Assessment Act. But we are talking about bringing in an amendment in 1984 that reaches back to 1977 without , as Senator Harradine, Senator Chipp and I would contend, having any idea of the numbers of funds which will now become evident as not meeting the requirements under section 23F. I will leave that matter and perhaps return to it later. I believe that some of my colleagues want to refer to it also. There will be a debate on it during the Committee stage because of the amendment which the Opposition proposes to move. I turn now to another matter which is referred to in the amendment Bill before us. This relates to short term life assurance policies. The Government, in its own words, is extending the proposal announced by the former Treasurer in August 1982 to subject to tax bonuses from life assurance policies under four years duration to those which are under a duration of 10 years. The advice that I have is that the life assurance industry did not have strong objections to the proposals of the former Treasurer when he was relating these matters to policies of under four years duration. However, there are strong objections from the life assurance industry now to the proposal of the Government to extend this period to 10 years. This places normal insurance business at a strong disadvantage where it is heavily investment oriented as against other investment mediums, such as unit trusts and property trusts. A unit holder in a trust who could receive profits on realisation of his units after 12 months without paying tax on those profits, provided he is not classified as a trader, would be in a position of substantial advantage in comparison with someone who had a life policy of something under 10 years duration. The life assurance industry provided a table to the Opposition-I know the table was also made available to the Government-showing the extra benefit to a unit trust or property trust investor on the same investment of, for example, $40,000 compared with a typical single premium life policy over terms under 10 years with the difference representing in effect the loss of taxable revenue. The Treasurer contends that the rebate provision will ensure that policy holders will not be doubly taxed on capital gains. This is clearly incorrect as many policy holders will pay double capital gains tax because, firstly, they might be in the 46 per cent or 60 per cent marginal tax bracket and the rebate is 30 per cent. They could be normally in the 30 per cent tax bracket but because of the aggregation of capital gains tax in a single year they become 46 per cent or 60 per cent taxpayers in the year of cashing in their policy. Therefore it is not just a simple little extension from four years to 10 years of a proposal that was mentioned by the former Government. It is an extension which makes it much more likely that a taxpayer who is paying at the rate of 30 per cent will suffer a double capital gains tax. I say quite briefly that changing from four years to 10 years alters the underlying nature of the measure previously announced because of the practical effect of the change. I am told that no consultation took place with the industry as a whole on that change. The Treasurer justified this by alleging that life office management would have made the discussions public or would otherwise have made use of privileged information, thus resulting in the loss of some tax because people would have rushed to place money in policies of four years before the new arrangement was introduced. The industry is somewhat concerned about that sort of lack of trust because at the time of the discussions concerning the four-year proposal with the former Government confidentiality was fully maintained. The industry has challenged the present Treasurer to provide any evidence to the contrary. The Treasurer, in a letter to the industry, said that the legislation is directed at essentially short term investments dressed up as policies of life assurance to exploit taxation incentives intended for long term life assurance and that there was a need to take decisive action to put an end to this form of tax avoidance. It is probably defensible to say that in respect of policies for two years, three years or four years, but if it is a policy of up to 10 years it would seem to be drawing a very harsh distinction compared with other forms of investment. I would think that in the case of the 10-year policy and the disadvantage that will now arise from this proposal there will be a continuing belief that it is unfair competition as far as other methods of investment are concerned. It certainly is something that could have been discussed with the industry and may have resulted in something that was not as incompatible with what it would have believed could have been achieved in comparison with other forms of investment. The other matter to which I wish to refer is the matter of leverage leasing. Again there is some concern with regard to this matter. I know that this is a measure that was announced in 1981 and 1982 by the former Treasurer to curb the use of certain leverage leasing and similar arrangements. I think we are all aware that the use by tax exempt organisations of leverage leasing as a means of financing their business or their capital requirements had become something that was eroding the revenue that could properly be expected to be received by the Commonwealth Government. With the introduction of the leverage leasing legislation we have the general effect of the denial of all tax deductions in circumstances where the use of a leveraged arrangement will benefit non- residents using property outside Australia or owners of existing plant or tax exempt bodies. The investment allowance and the accelerated depreciation write- off are intended to provide tax incentives to private enterprise investing in new plant in Australia. In such circumstances we believe the use of leverage leasing to be admissible in that it is providing an encouragement for private enterprise to invest in new plant. We are also in agreement that the investment allowance and accelerated depreciation benefits should not be allowable in other circumstances. We are concerned, however, about the scope of the legislation. We are particularly concerned that its effects could be far more far-reaching than the intent of either the former Treasurer or even the present Minister. The legislation is extremely penal in that it denies all deductions to the owner of property in certain circumstances. At the same time it does not remove from assessment any income which the owner derives in respect of the use of the relevant goods. In other words, the owner pays tax on the income and receives no deductions in respect of the particular business. Accordingly, it is essential that this legislation apply only where it is in the absolute interests of public policy that it does apply. I think we all recognise that we have a mixed economy in this country and that there are cases where industry and government work together. In these circumstances it is only to be expected that there will be a substantial interchange of goods and services between the private and public sectors. It is in this area that the Opposition is particularly concerned about the far-reaching effects of the legislation. In particular, we are concerned about instances where, for example, private enterprise supplies goods or services to an exempt body to the precise specification of the exempt body. Let us take as an example a railway authority which requires private enterprise to manufacture and supply a product. Private enterprise might purchase the required manufacturing plant to the specification of the authority. The manufacture might then be supervised by the authority. It would seem in this circumstance that the legislation will apply. Similar concerns relate to proposed section 51AD4 (a) (ii), which deals with plant which is leased. We have no difficulty with the general thrust of the legislation, but we do believe that in certain areas it goes too far. For instance, under sub- section (10) of that provision basically all deductions are denied to a taxpayer at any time that this legislation applies. The Commissioner has in most circumstances no discretionary powers. Just a partial use of something-a matter of a day, a week or a month in which leased equipment could be used-would then deprive that person of any tax benefit. I am told that a lot of industries would be affected by this legislation because of the far-reaching consequences of it and the neglect to take into account partial use in giving benefits. Plant hire to public authorities would be caught under section 51AD (4) (a) (ii). It could apply to contract services to public authorities-for example, truck operators employed by a State mine. Privately-owned plant could be used in construction work by public authorities- for example, in the construction of buildings, houses, dams and road works. Private plant could be controlled by State enterprises-for example, a mine rail car on State railways. We could have private plant being supervised by a public authority-for example, the specification and supervision of private enterprise manufacturing plant. We could have privately-owned plants supplying services to private enterprise-for example, privately-owned electricity, sewerage treatment, water treatment and harbour facilities. If the relevant services form part of a State reticulation system, effective control may be present. It is the words ' effective control' within the amendment that is of concern. The industries include privately-owned plants supplying services to both private enterprise and public authorities-for example, privately-owned electricity plant, sewerage treatment plant, water treatment plant and harbour facilities. If the relevant services form part of a State reticulation system again, effective control may be deemed to be present. I seek leave to have incorporated in Hansard a list of the sections of the Act under which it is believed that these industries could be affected by the proposals that are before us. Leave granted. The document read as follows- Industries affected Section Plant hire to Public Authorities Section 51AD (4) (b) (ii) Contract services to Public Authorities (e.g. truck operators employed by a State Mine) Section 51AD (4) (b) (ii) (B) Section 51AD (4) (b) (ii) (C) Privately owned plant used in construction activities by Public Authorities (e.g . Construction of buildings, houses, dams, roadworks, etc) Section 51AD (4) (b) (ii) (B) Section 51AD (4) (b) (ii) (C) Private plant controlled by State enterprises (e.g. a mine railcar on State Railways) Section 51AD (4) (b) (ii) (C) Private plant supervised by a Public Authority (e.g. specification and supervision of Private Enterprise manufacturing plant) Section 51AD (4) (b) (ii) (C) Privately owned plant supplying services to private enterprise (e.g. Privately owned electricity, sewerage treatment, water treatment, harbour facilities etc. If the relevant services form part of a State reticulation, ''effective control' ' may be present) Section 51AD (4) (b) (ii) (C) Privately owned plant supplying services to both private enterprise and Public Authorities (e.g. Privately owned electricity, sewerage treatment, water treatment, harbour facilities etc. If the relevant services form part of a State reticulation system, ''effective control'' may be present) Section 51AD (4) (b) (ii) (B) Section 51AD (4) (b) (ii) (C) Senator Dame MARGARET GUILFOYLE — I thank the Senate. The three matters to which I wish to refer particularly are leverage leasing, about which I have just spoken, the proposals with regard to superannuation and the short term life policies. Whilst the Opposition did announce similar proposals and would have put them into effect had it continued in government, there are changes to some of those proposals to which I have drawn attention. I believe that in the comments to be made later by my colleagues and the comments that we will make at the Committee stage of the Bill we may be able to draw out some of the other arguments that will be important. Senator HILL(South Australia)(9.13) —I wish to deal with two aspects of the Income Tax Assessment Amendment Bill (No. 5) 1983. The first, and more important so far as I am concerned, is that relating to section 23F, superannuation funds. I also want to deal briefly with the new tax consequences on what has been described as short term life policies up to 10 years. I think I will be briefer than I intended because I understand significant amendments will be put before us tonight which I have not had the opportunity to see but which I gather will substantially change the provisions of this Bill. I return to the matter I mentioned that is of particular concern to me, that is, the new tax that will be imposed tonight and which will be retrospective to 1977. The other day I spoke briefly on this matter before the debate on the Bill was adjourned because it appeared from my perusal that it was an unnecessary piece of legislation, that there were adequate powers in the taxation Acts to ensure that section 23F funds are not used for the purpose of tax avoidance. I take it from the second reading speech of the Minister for Resources and Energy (Senator Walsh) that that is the purpose of this legislation. Also it follows that to make it retrospective to 1977 is totally without justification and should be rejected out of hand. The Leader of the Australian Democrats, Senator Chipp, raised a number of questions that have been put by the Deputy Leader of the Opposition in the other place principally seeking information on why the Deputy Commissioner of Taxation appeared to have changed his mind since 1980 when Mr Howard, then Treasurer, was given advice that legislation in relation to alleged abuses of these funds was unnecessary. That is a question that particularly interested me. I do not believe from what I have heard tonight-I have not seen anything before tonight from the Minister-that there is evidence that circumstances have substantially changed in the meantime. My fear was that this legislation was being based upon one case which the Minister, I concede, has distributed to honourable senators, Kelly v. Raymor ( Illawarra) Pty Ltd. It is a New South Wales case which, upon anyone's perusal, presented a most unsatisfactory state of affairs. It is a very big step to take one bad case and produce retrospective legislation to 1977. Therefore the other day I asked how many cases were involved. Regrettably as yet I have not had an answer to that question. I am also interested to know how much tax has been lost by these alleged abuses. Again, unfortunately, I do not have any information on that question. Senator Walsh —Fifteen million dollars. Senator HILL —I do not think that answers the question that I asked. I will explain. Tonight Senator Chipp tabled, with the Minister's consent, a letter from the Commissioner of Taxation dated 6 March which states in its last paragraph that the identified cases-the kind to which clause 5, the clause about which I am speaking, applies-involve revenue of some $15m. However, I do not know how that $15m is calculated. Is that $15m, which will now be taxed, revenue that can be raised under new clause 5 if it is brought into law? That is very different from the tax that would have been lost under the law as it exists at the moment. For example, I do not know whether it takes into account the possibility of the Commissioner reopening assessments in relation to contributions that have been made by employers. It appears to me from the extreme case of Kelly that clearly assessments can be reopened and disallowed. Am I to presume that all these figures are taken into account-the new tax that is imposed by clause 5; the tax that can additionally be gained by the reopening of assessments? If it is a case of fraud-'fraud' is a word stressed in the Minister's speech-the Commissioner can go back without time limit. If all this is correct, the figure of $15m becomes rather meaningless. It is not informative for my purposes and I suspect not particularly informative for the Senate. At this stage I do not know how widespread this abuse is. I have a suspicion that the contrary is the case, that it is a very rare abuse. Apparently today Senator Chipp had discussions with an officer of the Department of the Treasury and he has been convinced that at least some cases are involved apart from this very unsatisfactory one. Senator Walsh —Senator Messner had a briefing last night from the same officer. Senator HILL —I understand Senator Messner had a briefing also. No doubt that will be helpful to Senator Messner but it is not particularly helpful to me. Senator Walsh —I understood that he was speaking for the Opposition. Senator HILL —The shadow Minister has already spoken on this matter, and I do not think she had a briefing. These are questions that I raised two days ago in this place and I thought they should be answered and could be answered in the meantime. I regret that they have not. I also asked whether it could be explained why Part IVA could not be used in relation to the abuses of the type described by the Minister that have taken place since 1981. I know that the Minister briefly touched on this matter tonight, but I think it is fair to say that he has not explained to the Senate why it cannot be used. If I recall correctly he said there could be some practical difficulties. There are often difficulties in enforcing provisions of taxation Acts. Surely not every case in which we encounter difficulties demands further legislation particularly of this nature. Surely the Senate has the right to see that enforcement under existing provisions is not possible. That is why I asked the other day: Why not Part IVA? I have not had an answer to that. I asked why the Deputy Commissioner could not use other provisions he has under the Act. In an interjection to Senator Chipp tonight I mentioned section 170 of the Act. I cannot see, and it has not yet been explained to me, why assessments cannot be reopened. As I said, if they are of the nature of fraud they can be reopened at any time. In any other case they can be reopened as far back as six years. That has not yet been explained to me, and I hope that it will be explained before I have to vote on what appears to me at the moment to be highly unsatisfactory legislation. Senator Walsh —It will be explained. Senator HILL —I am pleased that it will be. I also asked: Why the critical date of 1 July 1977? That has not yet been satisfactorily explained. I think that when one considers that problem one has to take into account the advice that was given to the then Treasurer, Mr Howard, in 1980. Apparently this legislation was not designed simply to go back to something that has happened since 1980, when the advice was given to the then Treasurer. This legislation goes back three years prior to when the advice was given to him. On its face I find that to be quite unsatisfactory, and I trust that we will get a better explanation of it before this debate is concluded. I have read the letter from the Commissioner of Taxation, which I have only just received tonight and which purports to detail the types of abuse involved. I am somewhat surprised by the wording of that letter. References to raids against the revenue and matters of that nature appear to me to be more suited to a different type of correspondence. In relation to the type of abuse he outlines in that letter-we know of one case which has occurred; the premature dismissal of employees simply for the purpose of gaining a benefit under a superannuation fund, particularly in the circumstances that are stated in the Bill-the Commissioner said: It may well have been that there was this intention from the outset. This, I would concede, is a highly unsavoury affair and certainly nothing that anyone on this side of the chamber would condone. We say that, short of evidence being put before us, that is a very rare situation. We have been told of only one such case. Furthermore, we suggest to the chamber that adequate powers are available to the Commissioner under existing laws to do something about it. I mentioned the other day, for example, the fraud provisions of the Crimes Act. If we are talking about a scheme that has been set up with the intention from the outset of defrauding either the revenue or employees, I cannot understand why action cannot be taken under the provisions of the Commonwealth Crimes Act. I asked that question the other day and have not yet received an answer. I hope that the Minister will be able to deal with it later in this debate. Senator Walsh —Who did you ask? Senator HILL —I asked Senator Walsh, but he had left the chamber. At the end of Senator Chipp's speech the other day I used the opportunity to list in this chamber a number of questions. I think, in fact, that the Minister was attempting to answer some of my questions to Senator Chipp tonight, but the answers are not in full and, I regret, are not as yet to my satisfaction. I think it might be of some benefit if I give some background on the structure and purpose of section 23F, which relates to superannuation funds, for those in the Senate who have not had a lot of experience with taxation Acts or superannuation funds. Section 23F does, of course, relate to one form of employee fund. Its purpose is to provide for superannuation payments for the benefit of employees upon their retirement. Such payments are made into the fund by an employer. The employer is obliged by the provisions of the Act to do this on an annual basis. Payments may also be paid into the fund by the employees concerned. The incentive for the employer to make contributions is that they are tax deductible. The incentive for the employee to make payments is that in certain circumstances they may be rebatable. Provided the fund complies with the rules as to reasonableness contained in section 23F and the rules as to the type of investment, the income from that fund is exempt. I think that section 23F can reasonably be described as a measure that gives considerable legitimate taxation advantage. The rationale obviously is that it is worth while to provide incentives to enable employees to retire in reasonable comfort without being a drain on the state. So the state contributes at the time of the employee's employment through forgone revenue rather than theoretically after his retirement through increased provision of pensions and benefits. Those of a socialist persuasion may not like the rationale for schemes of this nature, but to me, and I think to those on this side of the chamber, it is sound and wise. Obviously there must be provisions in the Act to ensure that the tax- exempt quality of funds is not abused, that funds are not used simply as taxation avoidance measures, and that they do not take from the state an unreasonable proportion of revenue. So the rules of fair play which have been contained in the Act since the start of this scheme in 1964 have been varied from time to time. I think they were varied most substantially in 1982. The rules of fair play, if I might call them that, are that the fund must be continuing indefinitely. It must be exclusively established and maintained to provide retirement benefits for employees and/or for the payment of death benefits to their dependants. The right to receive benefits must be fully secured and forfeited benefits must be applied to the benefit of other members of the fund. The benefits to any member of the fund must be reasonable, having regard to such matters as salary, period of service, and matters of that nature. The Commissioner has developed a scale of reasonable benefits. Other provisions are included to ensure an arm's length relationship between the employer and the fund. Although the fund may be a qualifying fund, exemption, as I mentioned, is conditional upon compliance with a particular rule of investment which is commonly referred to as the 30:20 public securities investment rule. So the first test is whether the fund is a qualifying fund. If any of these tests of reasonableness is not complied with in any year it ceases to be a qualifying fund. The consequences of that are that the contribution may not be allowed as a taxation deduction and the income of the fund may be duly taxed. Therefore, if in any year it becomes a fund that allows an excess benefit to an employee there are severe taxation consequences. That, I think, is a question which those on this side of the chamber cannot understand and which requires an answer. In the years going back to 1977, why have the funds not ceased to be qualifying funds, which gives the Commissioner all the powers he needs both to disallow the contributions that have been made and to tax the earnings of the fund? Unless there is an answer to that-I cannot see it and I see my learned colleague Senator Watson nodding his head-this legislation simply is unnecessary . To continue my brief summary as to how funds operate, it is not surprising also that the principal of the business, if the business is a company, can also be an employee for the purposes of such funds and take benefits. It is supposed to be a fund for retirement and, therefore, under the deed it certainly may be the situation that if somebody retires early, that which has been placed in the fund for his benefit can go back into the fund for the benefit of those who remain, until retirement. The benefit in effect goes to the other employees, who may include the person I referred to as the principal. Often if a person who has been an employee has been dismissed for impropriety one will find under the terms of such funds that his benefit is forfeited. Rarely in my experience, if a person is dismissed because of economic circumstances or for some reason that does not relate to impropriety on his part, does he lose a benefit. However, with the loss of some employees it becomes obvious that the benefit to those who remain may become excessive under the rules. That is usually dealt with by most deeds. Certainly all deeds that I have ever come across have provided for an excessive benefit fund which runs in conjunction with the normal section 23F fund in order that anything which becomes excess can be siphoned off and taxed as it should be taxed under the Act. Every prudent trustee or employer who is setting up such a fund obviously wants to draw his trust deed in such terms because he does not want to risk the losses to the fund if it becomes an excessive benefits fund. When I say 'losses' I mean the taxation consequences that I mentioned earlier. No mention has been made so far in the Minister's comments of that usual type of fund. As far as I am concerned, that covers the vast majority of funds of this type. I do not doubt that on very rare occasions there is abuse. In fact I now know that there is abuse because I have read the one case that the Minister forwarded to us tonight. Unfortunately the answer of this Government is to take to the very rare abuse with a big stick and to affect detrimentally the interests of those who are innocent, not purely the interests of those who have acted in what we might loosely call a fraudulent fashion. It is clear that the Government found at least this one case of dismissal for the purpose of gaining a benefit for the employer. As I have indicated, that is clearly a highly unsatisfactory business. But as I said to Senator Chipp, that must be put into perspective and without further and better information from the Minister I retain the view that that would be a very rare occurrence. Instead of dealing with it under existing laws-and, as I indicated, I believe there are adequate powers for that purpose- this Government has decided to label all those who have gained an excessive benefit in quite honourable circumstances, a number of which I will mention in a moment, as being involved in practices 'involving clear elements of fraud', and it quite unnecessarily imposes upon them a new tax. It obliges them in effect to pay what amounts to a massive penalty, no matter what their bona fides. It does not purport to tax the excessive benefit. It purports to tax the whole of the payment out. Faced with somebody who back in 1977 gained a considerable excessive benefit, quite innocently because a number of employees retired from a fund that might have been in existence for 20 years or because his salary was reduced over the last few years as a result of poor economic circumstances so that his benefit, which had been largely earned in previous years became excessive, what does this Government do? It does not attempt to tax that excessive benefit in some way. Instead, it imposes a new obligation upon the total payment he received from that fund and adds it on to his income for that one year in question, so that he probably pays at the highest of the marginal rates. To me that is quite disgraceful. If there is an explanation for it, we are waiting to hear it. That is why I asked questions the other day, and I have not yet had a satisfactory explanation. It is true, I concede, that under this Bill a person in such circumstances can say to the Commissioner: 'Look, my circumstances are such that you should exercise your discretion in my favour'. That provision is included in this Bill, but I suggest to the Senate that it is not included in satisfactory terms. There are in the Bill no real guidelines as to what the Commissioner is to take into account in deciding to exercise that discretion in the taxpayer's favour. Basically the Commissioner can take into account whatever he considers to be relevant. I ask the Minister what that means. I hope he might tell us in due course what are these relevant factors that the Commissioner of Taxation can take into account. That is not in my opinion good tax law. It is not the type of tax law that this Senate should be passing tonight. It is casting the net unreasonably widely. It is putting an unreasonable onus on innocent taxpayers to persuade the Commissioner to exercise a discretion in their favour. As was said the other day, once it is shown that the Commissioner has complied with the form of his obligations, it is practically impossible, on appeal, to have that changed. So, inadequate protection for the taxpayer is contained in that provision. It gives the taxpayer and the Commissioner insufficient guidance as to the basis upon which the discretion should be exercised. In concluding, might I make a few other points. I mentioned that it is not simply a tax upon the excess benefit; it is a tax upon the whole of the benefit received which, if received as a lump sum, at the moment incurs only 5 per cent tax. So, it is a massive new tax. I do not think it can be described in any other terms. It is a disincentive to proper, fair and reasonable section 23F employee schemes being set up, and that will not be in the best interests of employees in this country. The 1982 guidelines have tightened up the obligations considerably, and I have heard it said by many that the standards are now sufficiently tough that there can be no possible justification for further legislation from 1982. As I said, I believe the few cases of fraud or impropriety before that date can be otherwise dealt with. Retrospective action, as has been mentioned tonight, will not assist any employee who has been harmed by those few cases of impropriety. The person who has actually been harmed, under this legislation gets no benefit whatsoever. I think the Senate should bear that in mind. If it is said that the purpose of the legislation is to dissuade those who are of a mind to commit fraud, the provisions of the Crimes Act and other provisions which deal with fraud, specifically Part IVA of the Act , will be much more effective in dissuading that type of unsatisfactory action. I am concerned about genuine employers who should not be classified with fraudulent cases and who will be wrongly caught within this Government's net. That is totally unsatisfactory. The proposed legislation will seek to recover a tax that was not legally payable and the payment of which has not been illegally evaded. As I said, now that the stricter guidelines are in force, it is totally unnecessary. I have mentioned section 170. I do not know why the Commissioner of Taxation is not out there reopening these assessments. I do not know why the Commissioner did not act in relation to funds that failed to comply with the guidelines years ago, so that definitely even this Government would appreciate that this provision was unnecessary. Senator Messner —The old section 260. Senator HILL —As Senator Messner says correctly, there was the old section 260 of the Act, before we had the Part IVA. Why was action not taken under that section? Failure in the past is not a justification for bringing before the Senate legislation of this type. Now auditors' certificates are necessary, and they include an obligation to show that the fund is being conducted in accordance with its constituent documents. Why has that not been mentioned to the Senate tonight? All in all, it is clear that the existing law is adequate to handle the few cases of fraud that apparently exist. This is a new, massive and unfair tax. There is no justification for it now and there is certainly no justification for it being backdated to 1977. Senator MISSEN(Victoria)(9.41) —In speaking on the Income Tax Assessment Amendment Bill (No. 5) 1983, I wish to deal not with the general matters about which my colleagues have spoken tonight but with one of the many different provisions in the Bill which provide some reforms of the tax law. The provision to which I wish to refer is the provision made in section 3 in respect to special benefits for disaster victims. Honourable senators will have no trouble in recollecting that early last year saw a disastrous period of bushfires in Victoria and South Australia. There was enormous loss of life and loss of property, and there was a great deal of hardship. Many people in those States are suffering from that hardship to this time, such as people who lost their properties and have had great difficulty in having them replaced, and the people who lost relatives. During that holocaust and after it, a number of people made provision and made gifts to others. The generosity for which Australian people are noted came to the fore. Many people wanted to give some assistance. Unfortunately, those people have been somewhat blighted in their sense of national duty by the way in which the Commissioner of Taxation has operated in the treatment of the gifts that they made. This has been a matter of considerable discussion in the Parliament, but it is not a matter that is covered in the Bill. The Bill provides a special benefit for disaster victims. As the second reading speech says: After the disastrous bushfires and floods . . . the Prime Minister announced that the income tax law would be amended to exempt from tax the first two weeks' payment of social security special benefit to the victims of those and any similar future disasters. That was a generous little help, but a lot more should have been done. This Bill is very defective because, although it presented the opportunity to do so, it does not clear up a defect which has been brought very clearly to the Government 's attention over the last year. Perhaps I can give a particular example of the position in which people who desired to be generous to the victims of bushfires found themselves when they made their donations in goods, in kind rather than in money. They found themselves treated by the Commissioner of Taxation in a completely different way . I should like to read from a letter from one of my constituents who wrote about this matter in July. He said: The Commissioner of Taxation has decided to interpret the Tax Act so as to require donors of farm produce and stock to charitable appeals to pay tax on the value of such gifts-a tax which would not be paid if these were sold and the proceeds of sale handed to the charities. Take the case of two farmers who each donate 1 tonne of potatoes to the Salvation Army. One sells the potatoes and hands the proceeds to the Salvation Army while the other ships the potatoes to the charity for its direct use in providing meals to the needy. Both farmers have made the same sacrifice of their property at the farm gate but one must pay tax on the value of his gift and the other pays no tax. It is self-evident that this is: (1) Illogical to the point of utter absurdity; (2) Unjust and contrary to the fundamental policy of tax legislation which requires impartial treatment, that is, equal taxes on persons in like circumstances. People produce these goods and, as part of their produce, they pay tax on them, but they are actually giving the goods to the same charitable cause. Many people discovered this anomaly after they had given the gift. The same writer, in a later letter and referring to the same sort of example, said that these factors could be cited in regard to the different farmers: First , they have made the same sacrifice of their property at the farm gate; secondly , both have claimed as a tax deduction their expenses incurred in producing the potatoes; thirdly, both are required to include the value of the gift as income, one as an actual sale and the other as a notional sale; and fourthly, only one, the farmer who sells the potatoes and hands the cheque to the Salvation Army, can claim the deduction. I should have thought that this being produced and shown to the Commissioner of Taxation, it would long since have produced a remedy, particularly as we live in a country which is prone to disaster and in which such things will happen quite often. One should not in any way discourage the desire of the people of Australia to give generously. This matter was raised in the House of Representatives by Mr Bruce Lloyd on 21 April 1983. He said this to the Government: The first point I want to put to the Minister for Finance (Mr Dawkins) is that one of the forms of tremendous generosity that were provided during the fires was donations in kind by other farmers in areas already drought stricken. One of those forms of donation was the provision of fodder. Fodder was needed more than money to keep livestock alive in southern Victoria in the days immediately following the fires. Because of the greatest drought in our history there was already a shortage of fodder. However, those donations were not tax deductible. I appeal to the Minister to consider that situation because that was a donation far more generous than money. Money would have been useless in the circumstances . I understand there is still the problem of what happens to the advances made to people as fire relief and whether that is tax deductible. However, the main point I want to concentrate the Government's attention on is whether it is possible to do something about donations in kind, particularly when they are given with such generosity. Of course, he did not get any satisfaction from that. In addition, Senator Harradine, on 25 May 1983, asked a question about bushfire relief donations as tax deductions. He wanted to know whether the Treasurer (Mr Keating) and the Minister for Finance (Mr Dawkins) were aware of the different attitudes being taken by the Australian Taxation Office in relation to donations of cash as distinct from donations in kind for the victims of the Victorian and South Australian bushfires. He pointed out the effect that this would have on gifts. In reply to the question, Senator Walsh said that he was not aware of what distinctions, if any, the Taxation Office was drawing between donations of cash and donations in kind. He said that he would seek a definitive answer from the Minister. Senator Walsh —When was that? Senator MISSEN —That was on 25 May 1983. We have almost reached the anniversary of when the complaint was made directly to you. Following that, I had correspondence with the Treasurer. I wrote to him on 28 July 1983 making the same complaint. I have had acknowledgments and I have been told that the matter is being considered by the Treasurer and that in due course some answer will be given. But I have received no definitive response. I wrote again on 28 November 1983 pointing out that I had received further representations and further approaches. I pointed out then that Senator Don Chipp had a private members Bill to remove this serious anomaly. He brought it before the Parliament in this chamber on 24 August 1983. That Bill has not yet come on for debate. In November I asked the Government, because I was anxious to know, what was happening with this Bill and whether appropriate action would be taken by the Government to rectify the law to allow more people to make donations of produce and stock to those adversely affected by national disasters without being punished for their generosity and trouble. I have had no reply whatsoever to that letter. That is a not untypical reaction by this Government to correspondence in which one makes serious complaints. Here we have legislation that would have been the obvious vehicle in which to incorporate a sensible amendment to remove this anomaly, an amendment which would give the people who wish to act generously in cases of dire need in Australia the opportunity to do so. It is a shame that the Government has not taken the opportunity in this Bill to do it. I regret that the private members Bill has not yet come on for debate. I hope that Senator Chipp proceeds with it. It seems to me that it is important that this Parliament do justice to the people of this country whose warmth of heart and generosity of spirit have been let down badly by the Government. Senator COOK(Western Australia)(9.51) —The Income Tax Assessment Amendment Bill (No. 5) 1983 introduces a number of amendments to Australian tax law which are categorised under seven headings-withdrawral of investment allowance where property is used in tax exempt activities; leverage leasing and similar arrangements; special concessions for Australian trading ships; bonuses and other amounts received in respect of certain short term life assurance policies; deductions for investment in qualifying Australian films; exemption of payments of special benefit to victims of major disasters; and-this is the part which has incited the most comment in this chamber this evening-tax avoidance practices in relation to employee superannuation funds. All of these amendments, of course, are supported. Some are controversial and some are not. Some were mentioned by the former Government. Naturally, I support all of the amendments. I think that in tonight's debate the Opposition has been deliberately obtuse. It has not been prepared to come to grips with exactly what is before the Senate in that part of the legislation referred to as covering the cherry picker scheme . I want to concentrate on that last group of amendments. I think it is quite reasonable that the Government should proceed in this area. The cherry picker scheme is a most outrageous and reprehensible tax avoidance mechanism. It is referred to in a letter received today from the Acting Commissioner of Taxation as 'blatant and contrived'. Later in the letter the Acting Commissioner stated: The practices seem to me to be brazen and bare faced and involve abuses of the tax law which, in the superannuation area, contains generous concessions intended for the benefit of the employees . . . I do not think anyone in this chamber would in any sense wish to defend the type of scheme known as the cherry picker scheme. It perverts the real purpose of superannuation by the creation of sham funds and it manipulates and victimises workers at the point of termination of their employment and in terms of their benefit entitlement. It avoids taxes properly due and, in doing so, deprives the revenue of a considerable amount of money to which it would otherwise be entitled. The Acting Commissioner of Taxation in his letter of 6 March has indicated the amount to be of the order of $15m. Senator Walsh —At a bare minimum. Senator COOK —At a bare minimum. Of course, that means that ordinary taxpayers are treated as suckers by the perpetrators of these schemes. Ordinary taxpayers pay more because people in this country are prepared to resort to such schemes in order to avoid their proper tax liability. As I have said, I do not think anyone in this chamber would argue that such schemes are reprehensible, but it has been argued tonight that such schemes are not widespread. It has been taken on the bases of that assertion, which I hope to demonstrate later by resort to some documentation, that therefore we ought not to move in this area as we have proposed to move. I suggest that, even if the schemes were not widespread, that would be no argument for not moving to stamp out reprehensible practices of this nature. But, of course, it is not true to say that they are not widespread; they are. They are anecdotally well known by anyone associated with the broad range of business activities, in particular proprietary companies in the small business area and people who have been employed by those companies. It is my regret that the scheme is known by the somewhat flamboyant and colourful title of the cherry picker scheme, because something as distasteful and tawdry as this type of manipulation ought not to have such an attractive title. I think it is essential to put on the record briefly and, I hope, succinctly the nature of these schemes. Essentially, the features of a classic cherry picker operation is that a bogus or not genuine superannuation scheme is established. Usually it is established in a proprietary company, but that is not necessarily the case. However, the companies are usually small businesses. From my experience and from reports that I have from reliable sources, the people who establish such schemes are those who flirt with or are constantly involved in all other forms of tax avoidance and evasion. It seems that once the mind sets upon methods of tax avoidance and tax evasion the cherry picker scheme comes into the imagination and, unfortunately for these types of companies, is later put into practice. The principals who establish these schemes cite themselves as employers and usually pay the maximum superannuation payment into the fund on their own behalf and on behalf of the genuine employees of the company. The workers in a classic cherry picker scheme have at best only a vague idea of its existence. Often the scheme is concealed from them so that they are not aware of it and thus cannot front up later and claim what they regard as their entitlement. To my knowledge, where the scheme is only vaguely known there is obfuscation and deliberately misleading information is given in order to put workers off the scent, to confuse them or to intimidate them about inquiring further as to the existence of the scheme. That, of course, brings forth the whole set of reprehensible employer-employee relationships. The key aspect of the cherry picker scheme is that if the employees knew of such a scheme and were able to claim their entitlements the scheme as it was designed would not operate . It cannot operate effectively where workers become beneficiaries of the scheme . I wish to return to that point later because some play has been made about that aspect in earlier debate in this chamber. Classically, in the cherry picker scheme the principal lends his funds back to the company involved, usually at a very low interest rate, for the benefit of the founders of the scheme. Of course, it does not return a rate on investment to the scheme that would maintain its benefits if it were a genuine scheme. The provision is always that the superannuation payment is payable to fund members upon retirement. That provision is usually so constructed as to provide that in other circumstances the trustees of the scheme, who are of course the perpetrators, are in a situation of exercising discretion as to whether payment should be made other than when workers retire. Classically, they always exercise that discretion so as to avoid making payment. The other classic aspect of such a scheme is that a company frequently keeps a list such as that described in the case of Kelly v. Raymor (Illawarra) Pty Ltd by Kelly's counsel as a death list of workers who are approaching retirement and who are duped into retiring earlier so that they do not qualify under the provisions or who are sacked or retrenched before retirement. Alternatively in a cherry picker scheme the company, but not the superannuation scheme, may be transmitted to another company. Therefore the shell company folds and pays out the remaining benefit to the directors who are cited as employees. The end purpose of the whole operation is that the company owners who list themselves as employees become sole beneficiaries to the fund of the scheme and deprive the taxation authorities of revenue. Taxes are avoided by profits being diverted into the scheme. Once excess benefits are paid out and the fund is wound up no money is left to pay any other tax liability and the proprietors, as beneficiaries of the scheme, are often classically in a situation where they pay only the 5 per cent tax on termination. As I have said, I think the bones and structure of the type of scheme we are talking about-this practice that I believe can be demonstrated as being much wider spread in the community than the Opposition will allow in the debate in this chamber tonight-should be placed before the Senate. As has been referred to by other senators, the Minister for Resources and Energy (Senator Walsh), representing the Treasurer, has been kind enough to have circulated to us a decision by Mr Justice Wootten of the New South Wales Supreme Court in the case of Kelly v. Raymor (Illawarra) Pty Ltd. I refer those who wish to pursue the argument that these schemes are not widespread, that this is somehow an oddity of a case, to page 598 of the findings of His Honour Mr Justice Wootten. His Honour Mr Justice Wootten is referring to the fact that the litigant in this case, Mr Paul Kelly, called a superannuation consultant in order to adduce evidence from an expert witness as to the type of superannuation schemes that operate. Because of the context in which His Honour Mr Justice Wootten has quoted the matter-as an approving quotation-one must agree that His Honour accepts this as a reasonable statement of fact from an expert. He states: A superannuation consultant called by the plaintiff, in the course of his evidence, said that from his experience he would classify superannuation funds into two categories, genuine superannuation funds and tax avoidance superannuation funds. He said that the most extreme category of tax avoidance funds would have the following characteristics. He goes on to cite the typical characteristics of a cherry picker scheme and concludes: In the ultimate example the benefits on resignation are never paid and few retirement benefits are paid, and the fund simply rolls on as a fund of money. There can be no doubt that the Raymor superannuation fund was of this extreme tax avoidance category. I conclude the quotation at that point and simply state for those who want to labour the argument that this is an oddity of a case, a rare example not typical of the type of thing that in fact happens, that we have in the Kelly and Raymor case expert evidence that establishes that there are other schemes and that this is a well known fact in terms of superannuation. Senator Messner —Who won the case, Senator? Senator COOK —If the honourable senator asks that question he should also know that the case was withdrawn by agreement. But the judge goes on to describe what can only be the moral turpitude of the type of people who operated the scheme and he took certain actions to bring it to the attention of the authorities. The honourable senator asks the question: 'Who won the case?' Essentially, no one won. Therefore, this legislation is necessary in order to make sure that the type of fraudulent activities that were engaged in here are not continued. As I have said, I believe that anyone who moves in the normal commercial world with his or her eyes open will be aware of the existence of these schemes. From the point of view of putting another piece of information on the record, I am indebted to my colleague in the House of Representatives the honourable member for Newcastle, Mr Allan Morris. Mr Morris has brought to my attention a scheme which has all the classic definitions of a cherry picker scheme. It is operated by a company that a constituent of Mr Morris, a Mr Hadley, has complained about. Mr Morris and Mr Hadley have given me permission to quote from their description of the scheme to establish that, in this debate, we are not merely talking about a one-off case, Kelly v. Raymor. I wish to quote from a letter-Mr Morris has authorised me to do so-from him to the Treasurer (Mr Keating). It describes the scheme to establish the bona fides of my statement. Mr Morris states: I write concerning the operation by a company known as Carnaby Sales Pty Ltd . . . a superannuation/ Pension Fund. I have been approached by a previous employee of the Company, who advises me that he discovered that monies from the Company were being paid into this fund, purportedly on his account. He was never formally advised of this, nor, he claims, were other employees. I have been led to believe that significant sums of money were placed in this Fund, tax free, employees were dismissed, etc. without ever being advised of the Fund's existence, and the Principals of the Company have closed the Fund and received all monies accrued. I understand the device is called 'cherry picking'-- I think we can labour the point that these things do not occur because we do not want to recognise that they do occur. My point is: I do not believe that argument can be put in all seriousness if we look at the case of Kelly and Raymor, if we read that decision of the judge, if we move in the commercial world with our eyes open and if we take account of the type of example that Mr Allan Morris, the honourable member for Newcastle, has presented. I think the issue to which we should pay some attention is that millions of dollars are lost to the Taxation Office each year. Honest taxpayers are taxed more heavily as a result. We cannot be in a position of defending the tax avoidance industry. We find in the Kelly and Raymor case several very pithy quotations. But since the question was asked earlier in the debate in this chamber: 'What about the workers involved; what about their fate?', I draw the attention of honourable senators to page 597 of the document which has been circulated by the Minister. From lines 15 to 45 four cases are set out in which workers lost amounts of $50,000, $48,000, $53,639 and $40,000 to which they were entitled. All the circumstances are set out there. Had they known of their entitlement and had they been in the position to pursue a claim-a matter that His Honour Mr Justice Wootten makes it clear they were confused about or at the very least misled about and, in some cases, deliberately not informed of-they would have had an entitlement. But the point is this: This scheme operates so as to deny that information because it is not a scheme for the benefit of the workers at all; it is a scheme to avoid taxation. The whole purpose of the scheme is not to confer a benefit but to accrue an advantage to the perpetrators of the scheme. I do not argue that any honourable senator in the debate in this House would support such a scheme. But I believe it is essential that, if we are clear on the question of not supporting it, we should be clear on what steps are to be taken to prevent it. In order to do that, in terms of tax law, the fundamental principle that has to be looked at-a principle that I have mentioned in previous debates on all the tax Bills of a controversial nature that have come before this chamber-is that there is no incentive for tax avoidance or tax evasion if there is a clear understanding in the mind of all would-be perpetrators of such avoidance and evasion that the Government, upon discovering deliberate avoidance and evasion, is prepared to legislate retrospectively to stamp out that avoidance and evasion. If they know that a government can do that, tax avoidance becomes a back number. The unfortunate aspect of the previous debates on tax avoidance measures has been that the Opposition, some Australian Democrats and Senator Harradine have not been prepared to confront that principle squarely and , as a consequence, tax avoiders have escaped their obligations. I think it is about time we confronted that principle and moved to put the tax avoidance- evasion industry to flight by enacting at least this legislation and, since the Government has foreshadowed further bottom of the harbour Bills those when they come before the chamber. A matter that has been raised in earlier discussions is I think worthy of a particular comment from me. It has been asked: 'What about the workers who lose their benefits'? Essentially and fundamentally, although it is trite in this context to argue it, it also ought to be mentioned that the only way of protecting workers in the long run is the enactment of a national superannuation scheme. Workers who are the victims of cherry-picking schemes are typically in small enterprises that are not unionised and, therefore, have no industrial protection and are exploited by employers in those circumstances. That is cause for genuine outrage, but a tax Bill is not a way in which that outrage can be remedied because a cherry-picking scheme becomes illegal only when it has been wound up and the benefits have been taken. Prior to that point it is, from all outward appearance, a genuinely operating superannuation scheme. It may be that aspects of superannuation are not previously reported, deliberately delayed or avoided, but nonetheless it appears as a genuine scheme. The problem is that we cannot prove in advance that it is intended to be illegal. If we could, we could do something about it, but we cannot. The surest way of preventing these sorts of schemes is the preparedness to tax them as this Bill contemplates, because if they are then taxed properly there is no advantage in establishing a false scheme. If there is no advantage in so doing, those schemes will not be established and workers will be able to obtain genuine superannuation. The whole purpose of this type of practice is not to confer a benefit but to reap an advantage. I commend the Bill to the Senate. Senator WATSON(Tasmania)(10.14) —The Senate is debating the Income Tax Assessment Amendment Bill (No. 5) 1983. This Bill contains many provisions and covers a wide range of topics. It adds, in some cases we feel quite unnecessarily, to the already voluminous nature of the Income Tax Assessment Act , which now contains over 1100 pages. For that reason I will concern myself with only a few of the amendments which have been proposed by this Bill. Although not necessarily in order of importance, they include bonuses and other amounts which are received in respect of certain short term life assurance policies, covered in clauses 6 and 25, and tax avoidance practices in relation to employees superannuation funds covered in clause 5. In addition, the Bill gives effect to some of the decisions which were taken by the previous Government, the Fraser Liberal-National Party Government. Some of these changes, such as changes to leverage leasing, are generally welcome. However, we vocally and earnestly condemn two principal areas-the changes in relation to employee superannuation funds, and the retrospective provisions which attach to those sorts of funds under this legislation. The previous Treasurer, John Howard, was attacked because of his intention to proceed on leverage leasing tax avoidance arrangements by none other than the Premier of New South Wales, the Honourable Neville Wran. As he said at the time, it would affect a financing arrangement with a New South Wales power station. Yet today we do not hear that same criticism coming from that same Premier when a similar matter is introduced by a Federal Labor Government. However, I think I can detect that it is not quite the leverage leasing arrangements that John Howard introduced. As Senator Dame Margaret Guilfoyle mentioned earlier in the evening, it is foreseen by certain private contractors who are doing business with certain statutory bodies that, the income of those bodies being exempt, they could be in difficulty under this legislation. The Minister for Finance (Mr Dawkins) and the Attorney-General (Senator Gareth Evans) in the early days of the Hawke Government said that the retrospective legislation would be used only in limited circumstances and only for the schemes of a blatant, artificial and contrived nature. I might not have summarised their words completely, but certainly that was the notion that was given to Australian taxpayers at large. It certainly appears from this legislation and from earlier retrospective legislation introduced into this House that, in the words of my colleague the honourable member for Denison (Mr Hodgman), the Hawke Labor socialist Government has now changed its mind. The Senate should be reminded of what I will refer to as open and complete disclosure in the form of papers that were presented to this chamber by the former Government upon request from this chamber in relation to bottom of the harbour schemes. A voluminous set of documents was presented, and some members of the then Opposition believed that they were being snowed by the volume of information by way of documents that was given to the Senate. A similar request was made by Senator Chipp but we find no more than a letter coming back explaining the situation in not very convincing terms. In support of the legislation I also have a letter from the Minister for Resources and Energy (Senator Walsh), who sent along the Kelly v. Raymor ( Illawarra) Pty Ltd case. This case gives some indication to the Senate of the blatently contrived schemes the Government is trying to prevent. The previous speaker, Senator Cook, referred to this sort of operation as a cherry picker scheme; in other words, the final beneficiaries were the directors. Let us look at the essential ingredients of this case. There is a superannuation fund, ostensibly a section 23F fund. The first clue to the Commissioner of Taxation, when he should say: 'Yes, we should be on the lookout', is a maximum contribution to the fund by the employer. That is the first signal that something may be wrong. The second clue is that the contribution is loaned back to the company, to the directors. These are disclosed in the superannuation returns and in the balance sheets that are presented with the company accounts. Again, the second clue is that there is no attempt by the trustee to discharge the duties towards the members. The third clue concerns a trustee being removed and another one being appointed-a sure sign that there is trouble. I submit that , as the letter says, there was a deliberate policy of keeping employees in the dark about the existence of their rights under the superannuation scheme. I submit that the Commissioner has not been doing his job and in not doing his job he has thrown the onus upon this Parliament to try to tidy up the mess for him. All the signs were there. Let us go through the terms and conditions that are required under section 23F. Before doing so, I draw the attention of the Senate to Part IVA. It is a relatively new provision which came into being in the early 1980s. Part IVA was designed to replace an earlier provision which was designed to catch all tax evasion and avoidance measures that had escaped the tax collector's net as a result of a number of High Court decisions. We have not been given evidence by the Minister that Part IVA is not working in this area. We have not been given evidence that the Commissioner was doing everything in his power, by virtue of his having to look at and approve of the trust deed, and receive the annual accounts of the company and the accounts of the superannuation funds. He has seen what has been going on, but he has not been discharging his duty as required and as set down by the Act. I believe the Minister has a responsibility to convince the Senate-- Senator Walsh —The Taxation Office was starved of staff for years by your Government. Senator WATSON —We have an interjection from the Minister at the table. He said that the Australian Taxation Office was starved of staff. If that is the reason, it is further proof that this legislation should not be before us today. All that the Commissioner has to do is to start to discharge his duties. A very interesting point was raised tonight by my colleague, Senator Hill, a lawyer. Why has not the Commissioner started to invoke section 170 of the Act where there has not been a full and true disclosure? Whichever way he tries to look at the matter, there are plenty of provisions in the Act which permit the Taxation Commissioner to take action in relation to these matters. I mentioned that I believe section 23F contains all the safeguards which are needed by the Commissioner to be able to discharge his duty. What has been said in this Parliament tonight would indicate that because of a lack of staff and for other reasons he has not sufficiently looked into and examined these superannuation schemes in approving them in the first place and then in not watching the progress of those superannuation schemes over the years. One of the conditions under section 23F is that there must be a communication to the employees to make sure that those employees' rights are safeguarded. I ask: What sort of piece of paper did the Taxation Commissioner ask the trustees of these funds to submit to him as proof that there had been adequate communication to the employees? We all know that bigger companies have a little book wherein the terms and conditions of the provident or superannuation fund are set out. The usual procedure with public companies is that this booklet is forwarded to the Taxation Commissioner. In relation to the private superannuation funds, which have probably not gone to the expense of having a written booklet produced, I ask: In those circumstances does the Commissioner sight a certified copy of that letter from the trustees to the employees? This was the worry of Senator Harradine in the debate tonight. He believes that it is all very well for the Taxation Commissioner to get his chop, but what about the employees? We see in the cherry picker scheme that has been referred to tonight that the rights of the employees have been totally forgotten. Senator Messner —It is a breach of trust. Senator WATSON —I wonder whether the employees should now be waking up to themselves and starting to sue the trustees. My colleague Senator Messner said that there has been a complete breach of trust. Mr Deputy President, I seek leave to continue my remarks later. Leave granted; debate adjourned. Bill received from the House of Representatives. Ordered that the Bill may be taken through all its stages without delay. Bill (on motion by Senator Gareth Evans) read a first time. Senator GARETH EVANS(Victoria-Attorney-General)(10.26) —I move: That the Bill be now read a second time. I seek leave to have the second reading speech incorporated in Hansard. Leave granted. The speech read as follows- The purpose of this Bill is to amend the Wool Industry Act 1972 to broaden the borrowing powers of the Australian Wool Corporation and to widen the opportunities for investment of Wool Research Trust Fund moneys. The present provisions of the Act limit the Corporation to borrowing moneys from an approved bank or another lender. Under clause 4 of the Bill the Corporation's borrowing powers are to be broadened, specifically to include power to deal in securities. The Bill also provides that the Commonwealth may provide appropriate guarantees in respect of such borrowings. Clause 5 of the Bill repeals section 72 of the Act which specifies the investment options open to the Wool Research Trust Fund. The effect of this amendment is to make the Fund's investment procedure subject to the Audit Act which permits Commonwealth Trust Funds a broader range of investment options than is currently available to the Wool Research Trust Fund. The Bill is consistent with the Government's policy to enhance the efficiency and effectiveness of the operations of the primary industry statutory marketing authorities. The Australian Wool Corporation operates in an increasingly difficult and competitive environment and needs to be able to take advantage of the best borrowing rates available. To date, restrictions on the Corporation's borrowing powers have effectively limited its borrowings to term loans or overdrafts from banks. These sources of finance can be considerably more expensive than other avenues and impose unnecessary costs on woolgrowers. This is especially so at present when, because of depressed market conditions, the Corporation has had to borrow significant sums to finance the Reserve Price Scheme for wool. The provisions of the Bill give the Corporation borrowing powers comparable with those of other major statutory authorities and place it in a position where it can commercially evaluate alternative sources of finance for its operations. In summary, the amendments proposed in the Bill will allow for better management of woolgrower funds for market support operations and for wool research. I commend the Bill to honourable senators. Debate (on motion by Senator Reid) adjourned. Senate adjourned at 10.27 p.m. The following answers to questions were circulated: (Question No. 367) Senator Colston asked the Minister representing the Minister for Health, upon notice, on 15 September 1983: Does the Department of Health accept a reverse charge telephone call after country nursing homes have been telephoned by STD or by way of a booked call in relation to information required by the Department and where the nursing home personnel are obliged to return the call with the information required. Senator Grimes —The Minister for Health has provided the following answer to the honourable senator's question: No policy has been laid down with respect to this matter and so the practice varies between States. However, the costs of such telephone calls are recognised by my Department as costs incurred in providing nursing home care. In the case of nursing homes approved under the National Health Act, the cost is therefore reflected in the approved fees and the Commonwealth benefits rates are determined having regard to the levels of these fees. In the case of deficit financed nursing homes, the cost is taken into account in calculating the approved budgeted deficit which is met by the Commonwealth. (Question No. 482) Senator Peter Rae asked the Minister representing the Minister for Health, upon notice, on 3 November 1983: (1) What was the average age of persons who died in Australia in 1980 (a) from respiratory cancers; (b) from Ischaemic heart disease; and (c) from all other causes, according to the Australian Bureau of Statistics measurements and classifications. (2) What was the average age of people who died between the ages of 35 and 64 in 1980 (a) from respiratory cancers; (b) from Ischaemic heart disease; and (c) from all other causes. Senator Grimes —The Minister for Health has provided the following answer to the honourable senator's question: (1) (a) 67.3 years. (b) 70.7 years. (c) 66.2 years. (2) (a) 56.6 years. (b) 55.1 years. (c) 54.6 years. Spokesmen from the tobacco industry have recently used statistics such as those given above in claims that deaths from diseases caused by smoking are not premature. Such deaths are premature, not in the sense that they are concentrated at young ages, but in the sense that they occur in individuals who would otherwise have lived longer. (Question No. 512) Senator Jack Evans asked the Minister representing the Minister for Science and Technology, upon notice, on 15 November 1983: (1) What is the expected capital cost, when completed, of the new national oceanographic vessel now under construction in Queensland. (2) What is the expected annual operating cost of the vessel which is to be met by the Department of Transport. (3) What annual operating costs will have to be met by the Commonwealth Scientific and Industrial Research Organisation in order to fully utilise the vessel and how many extra staff will be required. (4) What is the estimate of the annual costs to be associated with the use of the vessel by scientific organisations (including non-CSIRO personnel). (5) Will the vessel, after completion, be accepted as having a vital national role, and will its construction not give rise (as in the case of the Australian National Animal Health Laboratory) to doubts as to its utility, with the possible consequences of its operating costs being withdrawn. Senator Ryan —The Minister for Science and Technology has provided the following answer to the honourable senator's question: (1) The oceanographic research vessel (ORV) is being designed and constructed by North Queensland Engineers and Agents Pty Ltd, Cairns at a contract price of $12.2m. This sum is subject to changes directly attributable to variations in overseas currency exchange rates and includes $1.5m for scientific instrumentation and equipment. Other variations to the cost allowed for under the contract are: modifications requested by owner substitutions where cost savings may accrue to owner incentive payments to the builder in respect of fuel consumption (if applicable ) liquidated damages to the owner in respect of speed, fuel consumption and deadweight (if applicable) Total additional costs arising from all allowable variations to date amount to $328,000. (2) The Government is currently considering the options available for operation of the ORV as part of a general review of the operation of Commonwealth vessels. The costs, if any, to be met by the Department of Transport depend upon the Government's decision on the outcome of this review. (3) Exact annual operating costs will depend upon the mode of operation finally chosen. CSIRO's current estimate of total operating cost is of the order of $3m. Included in this estimate is provision for an additional eight technical personnel required to maintain and operate the vessel's scientific instrumentation. (4) It is intended that the vessel will be operated as a national research facility. The general principles governing charges for the use of such facilities are currently being examined by the Australian Science and Technology Council and the Australian Marine Sciences and Technologies Advisory Committee. (5) The vessel is being acquired on the basis that it will operate as a national facility. ASTEC has indicated its support for this decision in its 1979 report 'Marine Science and Technologies in Australia: Immediate Issues'. There has been extensive consultation with potential users in the Australian marine science community regarding the selection of scientific instrumentation of the widest possible utility within the overall funds provided for the vessel. I am not aware of any disquiet within the marine science community as to the utility of the vessel. It will certainly provide a means for strengthening the Australian marine science research effort. (Question No. 520) Senator Archer asked the Minister for Social Security, upon notice on 18 November 1983: (1) What new authorities, committees, bureaus, or other such groups: (a) have been established; or (b) are proposed, by or within this Department, since 5 March 1983. (2) How many additional staff: (a) have been, or are being, appointed; or (b) are proposed to be recruited, as a result. Senator Grimes —The answer to the honourable senator's question is as follows: (1) (a)-National Advisory Council on Social Welfare-Disability Advisory Council of Australia-Handicapped Persons Review Secretariat-Commonwealth/State Management Committees on Emergency Relief. (b) Nil. (2) (a) Additional staff were appointed to my Department on a part-time basis to assist in administration of the Commonwealth State Management Committees on Emergency Relief. The total number is the equivalent of 3.5 full-time staff nationally. (b) Nil. (Question No. 607) Senator Coates asked the Minister representing the Minister for Health, upon notice, on 14 December 1983: (1) Has the Minister for Health seen the Royal Australian Chemical Institute report 'Why Doesn't Australia have a Research-Based Drug Industry'. (2) What is the Government's reaction to the report and its recommendations. (3) Will the Government set up a national medicinal and agro-chemical research and development council along similar lines to the National Energy Research Development and Demonstration Council. Senator Grimes —The Minister for Health has provided the following answer to the honourable senator's question: (1) Yes. (2) The Government has noted the report and recommendations with interest. A detailed submission on the matters raised is being developed by my Department. The Government is aware of benefits that might arise from development of a national research-based drug industry and that many of the necessary resources exist in Australia. However, in any consideration of such a development, account will need to be taken of the difficulties in establishing a position in the international market, the very high cost of research required to develop a new drug and the need to assess expenditure in this area against other priorities. The Industries Assistance Commission, in its 1976 report on pharmaceutical and veterinary products, noted the international character of the pharmaceutical industry, the concentration of research overseas and the relatively small size of the Australian market. The Commission considered that the local industry will continue to be predominantly based on compounding and packaging operations. Because of the high cost of developing a new drug, currently about $100m, the limited market for many such products and intense overseas competition, development of a viable research-based industry in Australia would seem to require the active support of established pharmaceutical industry. The Government has undertaken to review its pricing policies for drugs available under the pharmaceutical benefits scheme this year. This review process will have regard to the influence these policies might have on encouraging pharmaceutical industry to support Australian-based drug research programs. (3) The Government may consider establishment of a national medicinal and agro- chemical research council but the utility of such a body would need to be carefully appraised in view of the factors outlined above.