Wednesday, 3 October 1984 The DEPUTY PRESIDENT (Senator Hamer) took the chair at 10 a.m., and read prayers. The Clerk-Petitions have been lodged for presentation as follows: Pornography To the Honourable the President and members of the Senate assembled. The petition of the undersigned respectfully showeth: 1. That governments have a responsibility to maintain standards acceptable to society's wishes. 2. It cannot be guaranteed that X rated video material will not be viewed by children. Your petitioners most humbly pray that the Senate, in Parliament assembled should not adopt the X Classification for Films and Video Tapes, nor Category 2 for Printed Material. Further, that tighter restrictions be applied to R rated Films and Video Tapes and Category 1 Printed Material. And your petitioners as in duty bound will ever pray. by Senators Reid (from 14 citizens) and Walters (from 1,015 citizens). To the Honourable President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully shows: That we strongly support The A.C.T. Smoking and Tobacco Products Advertisements Prohibition Bill introduced by Senator Evans, because it represents the first positive national step towards the eventual elimination of wide-spread serious ill health caused by smoking tobacco. And your petitioners as in duty bound will ever pray. by Senators Chipp (from 298 citizens), Jack Evans (from 311 citizens), Haines ( from 294 citizens), Macklin (from 319 citizens) and Mason (from 261 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth: That in November 1978 more than sixty-two per cent of the voters of the Australian Capital Territory in a referendum rejected the introduction of territorial government or local government in the Australian Capital Territory. That until the findings of the Commonwealth Grants Commission inquiry into Australian Capital Territory finances have been made public and there has been a referendum of the voters of the Australian Capital Territory as to their attitude to territorial or local government. Your petitioners most humbly pray that the Government take no further action or legislation in respect of territorial or local government in the Australian Capital Territory. And your petitioners as in duty bound will ever pray. by Senator Crichton-Browne (from 123 citizens). To the Honourable the President and the honourable members of the Senate in the Parliament assembled. The humble petition of the undersigned electors of the Commonwealth of Australia respectfully showeth: 1. We are completely satisfied with the design of the existing Australian national flag. 2. We are aware it properly reflects the immutable characteristics of Australia , namely: The Union Jack-itself the creation of 3 Christian crosses-represents the nation 's historical origin, and the source of its language and law. The Southern Cross on an azure blue background signifying its place in space. The large star depicting the advent of Federation in 1901. 3. We know the flag has been a source of inspiration to generations of Australians in peace and war. 4. We recall that millions of native-born Australians and newcomers to these shores from other parts of the world have become united under its proud symbolism. 5. We are certain that any change to the flag will produce division in the Australian community. Your petitioners therefore pray that your honourable House will propose and pass a motion that 'the existing Australian national flag remains sacrosanct from change'. And your petitioners as in duty bound will ever pray. by Senator Durack (from 370 citizens). To the Honourable the President and members of the Senate in Parliament assembled, the humble petition of the undersigned citizens respectfully showeth their objection to any proposed legislation removing the power of existing Commonwealth law to prevent the importation and sale of hard-core pornography, e .g. x-rated videos, and publications which consistently incite the use of hard drugs. They furthermore petition that, because of the importance of this issue to society, a conscience vote be permitted to all members of Parliament. And your petitioners as in duty bound will ever pray. by Senator Bjelke-Petersen (from 38 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth: That we the undersigned, having great concern because of the spread of moral pollution in our nation call upon the Government to introduce immediate legislation: 1. To provide strict controls over importation, production, sale, hire or mailing of video-cassettes with the open sale of only G, PG, and M rated video- cassettes; and the total prohibition of the sale of R rated video-cassettes so that R rated films can only be viewed in an adult theatre by persons over 18 years. We totally reject the concept of 'X' rated video-cassettes which would allow the legal sale of hard-core pornographic films for screening in the homes of our nation, which endanger our children. 2. To dramatically improve the Federal Attorney-General's Guidelines for Classification of Video tapes/ discs which restrict the importation, production, sale or hire, screening in private homes and mailing by Australia Post so as to include the total prohibition of any pornographic, obscene or blasphemous video cassette, or film containing child pornography, bestiality, sodomy, group sex, violent sex acts with women, such as rape and pack rape, sadism and torture, etc . Your petitioners therefore humbly pray that your Honourable House will protect our society, especially women and children from moral pollution and its harmful effects. And your petitioners as in duty bound will ever pray. by Senator Peter Baume (from 21 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The humble petition of the undersigned citizens respectfully showeth that: 1. They call on the Senate and the Government of the Commonwealth to reject the recommendations of the Commonwealth Schools Commission contained in 'Funding Policies for Australian Schools', concerning proposed increases in State aid to private schools and the proposed community standard for education funding. 2. They call on the Senate and the Government of the Commonwealth to declare a three year moratorium (1985-1987) on increases in State aid to private schools and on grants for new private schools and for increased private school enrolments. 3. They call on the Senate and the Government of the Commonwealth to re-affirm their primary obligation to government schools and to implement all 1983 ALP election promises for increased funding to government schools. And your petitioners as in duty bound will ever pray. by Senator Robertson (from 22 citizens). To the Honourable the President and members of the Senate in Parliament assembled: The humble petition of the undersigned citizens of Australia respectfully showeth their desire to stop the commercial exploitation of the kangaroo. Your petitioners therefore humbly pray that your Honourable House re-apply the ban on the export of kangaroo products. And your petitioners as in duty bound will ever pray. by Senator Robertson (from 11 citizens). To the Honourable the President and members of the Senate assembled. The petition of the undersigned respectfully showeth that: 1. Amendments to the Customs Regulations have removed legal barriers to the importation of hard core pornography into Australia; 2. The introduction of X classification in the Australian Capital Territory, by the Prohibited Publications Ordinance, has removed legal barriers to the sale of hard core pornography within the Australian Capital Territory; and 3. The distribution of pornography degrades women, injures children and undermines family life. Your petitioners most humbly pray that the Senate, in Parliament assembled, should: 1. Disallow the Prohibited Publications Ordinance and the amendments to the Customs Regulations; and 2. Introduce legislation which adequately reflects community standards. And your petitioners as in duty bound will ever pray. by Senator Reid (from 116 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned shows: That we hail as a victory for the not-so-silent majority the decision of the Federal Government to now conduct an inquiry into the effects of hard-core pornography and violence upon people and especially children; That we view with grave concern and deplore the decision of the Hawke Government to allow the sale of this objectionable material to continue and become more widespread during the period of the inquiry. Your petitioners pray that the Senate, in Parliament assembled, should request the Federal Government to immediately re-enact the previous laws which banned the entry into Australia and the sale of hard-core pornography and violence in video and publication form. And your petitioners as in duty bound will ever pray. by Senator Bjelke-Petersen (from 175 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully show that: We deplore and oppose the decision of the Federal Government in legislating to allow the importation and distribution of hard-core pornographic video films and material into Australia and the social consequences of this action particularly for our children. We request the Federal Government to re-enact immediately the previous laws which banned the entry into Australia and sale of this hard-core pornographic material, until the inquiry into the effects of the current legislation in relation to adults and children has reported to the Parliament. And your petitioners as in duty bound will ever pray. by Senator MacGibbon (from 2,131 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully shows that: We hail as a victory for the not-so silent majority, the decision of the Hawke Federal Government to now conduct an inquiry into the effects of hard core pornography and violence upon people and especially children. We view with deep concern, and deplore, the decision of the Government to allow the sale of this objectionable material to continue and become even more widespread during the period of the inquiry. We request the Federal Government to immediately enact laws to ban the entry into Australia and the sale of hard-core pornography and violence in video and publication form. And your petitioners as in duty bound will ever pray. by Senator Martin (from 1,273 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The humble petition of the undersigned citizens respectfully showeth: That the phasing out of the recurrent grant to residential colleges will be detrimental to the ability of disadvantaged and country students to receive a tertiary education. That alternative arrangements to fund needy students will be of no net benefit to those students, owing to the higher costs of administering such arrangements. Your petitioners therefore humbly pray that the recurrent grant to residential colleges be maintained as the most efficient and equitable means of ensuring that all citizens, irrespective of background, have equal opportunity to receive a tertiary education. And your petitioners as in duty bound will ever pray. by Senator Chaney (from 409 citizens). To the Honourable the President and members of the Senate in Parliament assembled: The humble petition of certain citizens of Australia respectfully showeth- 1 The concern for the increasing global crisis 2 The concern for the arms-race and the desire for disarmament 3 The concern for the lack of specialists at a governmental level for non- violent conflict resolution. Your petitioners therefore humbly pray that the Australian Parliament establishes a Ministry of Peace. And your petitioners as in duty bound will ever pray. by Senator Childs (from 17,213 citizens). Petitions received. Senator REID(Australian Capital Territory) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) is concerned about the recent action taken by the Australian Capital Territory Apprenticeship Board in applying a strict interpretation of the relevant catering award for apprentice cooks; (b) abhors the fact that this now means that the intake of apprentice cooks in the Australian Capital Territory will be restricted to a maximum of 15 apprentices every three years; and (c) insists that the Government intervene to prevent further erosion of the rapidly diminishing sources of employment for Canberra's youth. Senator MASON(New South Wales) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) supports the Minister for Science and Technology, Mr Barry Jones, in his attempt to establish a Commission for the Future which would draw up options for future development and public debate on technological change in Australia; and (b) deplores the decision of Cabinet to refuse to consider detailed plans for the structure of the Commission, thus abrogating its responsibility to provide adequately for future development of Australia's technological resources. Senator REID(Australian Capital Territory) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) calls on the Minister for Health to explain the reasons for increasing delays and short notice of cancellation of elective surgery lists in Royal Canberra and Woden Valley hospitals; (b) expresses concern about inadequate nursing staff at Canberra hospitals and the inability of the Australian Capital Territory Health Commission to attract adequate numbers of nurses to staff Canberra hospitals; and (c) calls on the Minister to attend to the Australian Capital Territory section of his portfolio and take immediate remedial action in relation to both cancelled elective surgery lists and nursing staff shortages in the Australian Capital Territory. Senator GRIMES(Tasmania-Minister for Social Security) —Mr Deputy President, papers are tabled in accordance with the list circulated to honourable senators. With the concurrence of honourable senators, I incorporate the list in Hansard. Leave granted. The list read as follows- 1. National Debt Commission-annual report 1983-84-pursuant to section 18 of the National Debt Sinking Fund Act 1966. 2. Responsibilities and Resources of Australian Local Government-report by the Advisory Council for Inter-government Relations-pursuant to section 7 of the Advisory Council for Inter-Government Relations Act 1976. 3. Department of Treasury-annual report 1983-84. 4. Government response to the report from the House of Representatives Standing Committee on Expenditure-The Way We P (l) ay-Commonwealth Assistance for Sport and Recreation-together with the text of a statement by the Minister for Sport, Recreation and Tourism relating to the report. 5. Program presentation of appropriations and outlays-departmental estimates 1984-85-document-together with the text of a statement by the Minister for Finance relating to the document made in the House of Representatives on 13 September 1984. 6. Response to recommendations by Mr Vincent QC in the report of the review of matters affecting the Australian Telecommunications Commission-text of a statement by the Special Minister of State made in the House of Representatives on 13 September 1984. 7. Criminal Injuries Compensation Ordinance 1983-annual report 1983-84-pursuant to section 35 of the Criminal Injuries Compensation Ordinance 1983. 8. The Structure and Form of Social Security Appeals-report by the Administrative Review Council-together with the text of a statement by the Attorney-General relating to the report. 9. Repatriation Commission-annual report 1983-84-pursuant to section 122 of the Repatriation Act 1920. Motion (by Senator Jack Evans) agreed to: That leave be given to introduce a Bill for an Act for the prevention and settlement of disputes concerning the operations of contract carriers and bailee drivers. Bill presented by Senator Jack Evans, and read a first time. Senator JACK EVANS(Western Australia)(10.07) —by leave-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- Background This Government has abandoned the owner-drivers in the road freight transport industry. Earlier this year I approached the Minister for Transport (Mr Peter Morris) seeking government action to relieve the plight of owner-drivers and advising the Minister that, in the absence of government action, the Australian Democrats would act to preserve the owner-drivers' lives and livelihoods. The Minister advised me that the Government would take no action until the matter had been considered by the national road freight industry inquiry. In good faith , the Australian Democrats and the owner-drivers waited for the inquiry report. That report has now been presented and the problems facing owner-drivers have not been addressed. The report reveals that the Minister did not refer any matter to the inquiry for consideration! The inquiry considered only the terms which the Government had given it and, in the absence of direction by the Minister, nothing else. In light of the Minister's prevarication, the Australian Democrats have no alternative but to act. We are merely sorry that this Bill was not introduced earlier. The Bill This Bill seeks to establish tribunals which will enable legally binding determinations to be made with respect to safety, remuneration and other conditions relating to various classes of owner-drivers. It also provides a legal framework upon which owner-drivers can base industrial agreements with their corporate bailors or principal contractors. It does so by recognising and utilising organisations which are representative of certain classes of carriers and contractors. The Bill acknowledges the realities of industrial life: That some owner-drivers are pro-union while others are irrevocably anti-union. The Bill, therefore, does not exclude unions from representing carriers under certain classes of contracts. But a representative organisation does not have to be a trade union. In reality, at any one time, there will probably be at least two representative bodies representing carriers in a class of contracts: A union body and a non-union body. Registration, however, is contingent upon the organisation being an effective representative of its members. The Australian Democrats see no reason in perpetuating the 'us versus them' mentality that has existed in the past. Unions and non-union bodies representing contractors are not necessarily incompatible within an industrial relations system. Consequently, this Bill has not been designed for the exclusive use of either group. It has been designed to stop the death and exploitation of owner- drivers. This century has seen a revolution in the rights and conditions which apply to workers. Employers, governments and society have recognised that they have responsibilities towards workers. Consequently, industrial practice and the legal system has recognised the need for responsible standards relating to health, safety, remuneration and other conditions. However, contractors and sub- contractors have existed outside of this revolution. They have received some flow-on benefits enjoyed by employees. But, in the main, their dual employer- employee status has excluded them from the mainstream of accepted employee standards as a right. Contractors, as distinct from employees, enjoy freedoms and advantages in regard to their conditions of work. Similarly, those contracting to contractors enjoy flexibilities and advantages not experienced by employers or employees. This flexibility and freedom is necessary and desirable. Contracting is a two-edged sword which has rewards which compensate for the disadvantages to the parties involved. It is a practice which is desired by the participating parties and which is an essential component of modern society. In the road transport industry, however, the two-edged sword has turned into a single edged weapon against the sub-contracting owner-drivers. The contract system has been exploited by the advent of certain contractors who are exploiting their sub-contractors. The powerful companies of the road freight industry have found a vulnerable minority: The owner-driver. While big companies may cream substantial profits off the top of the industry, the small owner- driver is frequently forced to drive dangerously long hours and for rates which produce small or non-existent profits for the person who actually does the work. The small owner-driver places his own life at risk but, because of massive competition, he is now at the centre of a profit squeeze with increasing operating costs and low rates of payment from his principal contractors. In such a situation in another industry, the sub-contractor would go elsewhere for business. Owner-drivers are not so lucky. To enter the business they have to make large financial commitments and they are reliant upon a continual stream of work to enable them to maintain their payments on their investment. In addition, they are often bound to their principal contractors in ways which would make market mobility almost impossible. At almost every turn, big companies have small owner-drivers over a barrel. While small owner-drivers are a diverse and heterogeneous group which has difficulty in speaking with a single voice or in finding sympathetic ears, the large companies have found a tacit friend: Big government. While governments have acted to protect exploited employees-and employers-owner-drivers have been dumped into the 'too hard' basket. The answer of big government is to investigate and review and to inquire and to research and to refer to committees , and ultimately, to continue to turn a blind eye. The plight of owner-drivers is not new. It existed under the last Liberal- National Party coalition government and it continues to exist under the present Australian Labor Party Government. The big political parties have refused to stop the exploitation that occurs. They have refused to stop the deaths that occur as a result of the unrealistic deadlines and rates set by transport contractors. This Bill seeks to break the big company-big government-big political party alliance. It seeks to stop the exploitation of owner-drivers. The Australian Democrats have the courage to challenge the cosy alliance which exists. We cannot stand by idly, as have the other political parties, as owner-drivers are killed and exploited. This Bill will not satisfy all parties completely-no Bill will achieve that-however it is a practical means by which the present injustice may be corrected. The Australian Democrats are introducing this Bill in the expectation that senators and members, owner-drivers, transport companies, unions and other interested groups will consider it with an understanding that constructive comment will be welcomed by me. I commend the Bill to the Senate. Debate (on motion by Senator Grimes) adjourned. The DEPUTY PRESIDENT —Is notice of motion No. 132 standing in the name of Senator Missen relating to the powers and proceedings of the Parliamentary Joint Committee on the National Crime Authority formal or not formal? Senator Missen-Mr Deputy President, I say it is not formal because at this stage a message from the House of Representatives is listed on the Notice Paper today which appears to be in the same form as my notice of motion. So it is not formal at this stage. The DEPUTY PRESIDENT —Order! A message has been received from the House of Representatives relating to the powers and proceedings of the Parliamentary Joint Committee on the National Crime Authority. Copies of the message have been distributed to honourable senators. Motion (by Senator Grimes) agreed to: That consideration of the message from the House of Representatives order of the day for a later hour this day. Consideration resumed from 11 September, on motion by Senator Gareth Evans: That the Bills be now read a first time. Senator GRIMES(Tasmania-Minister for Social Security) —Mr Deputy President, may I suggest that we have a cognate debate covering these Bills. The DEPUTY PRESIDENT —Is it the wish of the Senate that that course be followed? There being no objection, it is so ordered. Question resolved in the affirmative. Bills read a first time. [COGNATE BILLS: BANK ACCOUNT DEBITS TAX ADMINISTRATION AMENDMENT BILL 1984 BANK ACCOUNT DEBITS TAX AMENDMENT BILL 1984] Senator GRIMES(Tasmania-Minister for Social Security) —I move: That the Bills be now read a second time. I seek leave to have the second reading speeches incorporated in Hansard. Senator Harradine —Mr Deputy President, I take a point of order. Do I understand that leave has been sought to have the second reading of the Bills forthwith, immediately after the Bills have been read a first time? The DEPUTY PRESIDENT —Yes. Senator Harradine —Leave has not been sought for that. The DEPUTY PRESIDENT —Leave is not required for the second reading debate to proceed immediately as these Bills originated in the House of Representatives. Is leave granted for the second reading speeches to be incorporated in Hansard? There being no objection, leave is granted. The speeches read as follows- INCOME TAX (RATES) AMENDMENT BILL 1984 The purpose of this Bill is to amend the Income Tax (Rates) Act 1982, which declares the rates of tax payable by individuals and trustees generally, to implement the Budget proposal to alter the personal income tax rate scale. Honourable senators will recall that the Treasurer (Mr Keating), in his Budget Speech, announced that there would be a significant cut in personal income tax, particularly for those on low and middle incomes. At a cost of $1,300m in 1984- 85, and over $2,100m in a full year, virtually all taxpayers are to receive a reduction in tax, with the biggest percentage reduction going to lower income earners. With effect from 1 November 1984, there is to be a new five-step tax scale, replacing the old three-step scale, in order to make the tax system more progressive and fairer. At the lower end of this scale, the tax rate for resident taxpayers on taxable income in the range $4,596 to $12,500 is to be reduced from 30 per cent to 25 per cent. A rate of 48 per cent is to apply to taxable incomes in the range $28,001 to $35,000 and the threshold at which the maximum marginal rate of 60 per cent commences is to be reduced from $35,789 to $35,001. These changes to the rate scale will be reflected in reduced pay as you earn instalments from 1 November 1984. Reflecting the commencement date of 1 November 1984, the rate scale for 1984-85 is to be an average of the 1983-84 rate scale and the scale to apply from 1 November 1984-made up of four-twelfths of the 1983-84 scale and eight-twelfths of the new scale. The average rate scale will mean that for 1984-85 the rate of tax payable by residents on income in the range $4,596 to $12,500 will be reduced from 30 per cent to 26.67 per cent, while for that part of taxable income in the range $28,001 to $35,000 and $35,001 to $35,788 the rates of tax payable will be 47.33 and 55.33 per cent respectively. The benefit of the reduced 25 per cent rate of tax will not be extended to non- residents, other than those in receipt of taxable Australian social security and repatriation pensions. The reasons for extending such concessions to residents are seldom relevant to non-residents, and particularly in this case as the reduction in personal income tax is in recognition of the wage restraint exercised by Australian workers. This means that the standard rate of 30 per cent will continue to apply to the taxable income of non-residents up to $19,500 , and the general rates announced in the Budget will apply to the income above $ 19,500. The income tax law currently provides for tax at the rate of 46 per cent or higher to apply to certain types of income derived by some unmarried minors. The $417 income threshold at which those rates become payable, the associated shading-in arrangements, and the minimum rate applicable of 46 per cent are to remain unchanged. The new rates applicable to income above $28,000 will, however , also apply to such income of unmarried minors. The present Bill will also provide that the Income Tax (Rates) Act 1982 will not apply to a trustee of an ineligible approved deposit fund. The rate of tax payable by such a trustee is to be the general company rate of 46 per cent and will be declared and imposed by the Income Tax (Companies, Corporate Unit Trusts and Superannuation Funds) Bill 1984 which I will introduce shortly. Provisions of the Bill are explained in detail in the explanatory memorandum that has been made available to honourable senators. I commend the Bill to the Senate. INCOME TAX (INDIVIDUALS) BILL 1984 This is an annual measure which formally imposes personal income tax rates for the current financial year. The rates imposed by this Bill are those declared in the Income Tax (Rates) Act 1982 as proposed to be amended by the Income Tax ( Rates) Amendment Bill 1984 which I have just introduced. As I explained in my second reading speech on that Bill, the rates for 1984-85 reflect the Budget decision to provide a significant cut in personal income tax, particularly for those on low and middle incomes, by changing the personal income tax rate scale with effect from 1 November 1984. The resulting tax reductions will benefit virtually all taxpayers, and are to be reflected in lower pay as you earn deductions from 1 November 1984. New tax instalment schedules to reflect the changes to be made to the income tax rate scale are being prepared and will be released as soon as possible to enable employers to incorporate the new instalments in their payroll procedures before 1 November. The reduction in tax will be reflected in provisional tax payable for 1984-85, which is also formally imposed by this Bill. I commend the Bill to the Senate. INCOME TAX (COMPANIES, CORPORATE UNIT TRUSTS AND SUPERANNUATION FUNDS) BILL 1984 This Bill will formally impose income tax for 1984-85 on the 1983-84 taxable income of companies, registered organisations and unit trusts treated as companies for tax purposes as well as on the current year taxable income of superannuation funds, ineligible approved deposit funds and trust income of non- resident company beneficiaries. The rates of tax are also declared by the Bill and, except for some changes relating to certain superannuation funds and the imposition of income tax upon the taxable income of registered organisations, they are the same as for 1983-84. The provisions of the Bill follow the same lines as in other years and details of the various rates are set out in the explanatory memorandum that has been made available to honourable senators. I commend the Bill to the Senate. MEDICARE LEVY BILL 1984 The Medicare Levy Bill 1984 declares the basic rate of Medicare levy for 1984- 85 and, until the Parliament otherwise provides, for 1985-86. The basic rate will be 1 per cent of taxable income. The Bill also contains rules for fixing the maximum amount of levy payable and the income points below which people with low incomes will not be called on to pay any levy. In addition, it contains rules for reducing the levy otherwise payable by veterans, war widows, defence force personnel, and certain other prescribed persons who are exempt from the levy for part of a year, or who are required to pay levy because they have dependants eligible for Medicare benefits. From 1 November 1984, the maximum amount of levy payable by an individual or a married couple is to be increased from $700 to $750. This will mean that in 1984 -85, a levy ceiling of $733.32-a pro-rating of the existing ceiling of $700 and the proposed $750 ceiling-will apply. In order to continue to shelter low income earners from the levy, the income thresholds at which levy becomes payable are to be increased from 1 July 1984. For 1984-85, individuals with taxable incomes of $7,110 or less, and married couples and sole parents with family incomes of $ 11,803 or less, will be exempt from the levy. The income threshold for married couples and sole parents will increase by a further $1,330 for each dependent child or student involved. For example, married couples with two dependent children will pay no levy until their combined taxable incomes exceed $14,463. The estimated cost of these changes is $8m in 1984-85 and $12m in a full year. Explanations of each clause of the Bill are contained in the explanatory memorandum that has been made available to honourable senators. I commend the Bill to the Senate. BANK ACCOUNT DEBITS TAX ADMINISTRATION AMENDMENT BILL 1984 The main purpose of this Bill, and a further Bill I will introduce shortly, is to permit three additional exemptions from the bank account debits tax. These exemptions were decided upon by the Government following a review of the tax and were announced by the Treasurer (Mr Keating) in the Budget Speech. A statement outlining the decisions taken by the Government as a result of the review was issued by the Treasurer on 22 August 1984. As indicated in that statement, the Government confined its review of the tax to the exemption provisions pending the outcome of an inquiry into the distribution of taxing powers between the Commonwealth and the States. Honourable senators will be aware of the numerous organisations and individuals who have made representations seeking exemptions from the tax in recent months. Those representations were given very careful consideration by the Government and it was concluded that it would be appropriate to grant three additional exemptions. The Government believes that the new exemptions will rationalise the existing exemption provisions while at the same time retaining the original concept of a broad based tax with few exemptions. The present Bill will grant two new exemptions. First, it will extend the range of exemption to include parents and citizens associations and other support groups for institutions that are themselves exempt from the tax. Secondly, it will exempt local councils and government bodies in respect of any minor business activities they carry on. In addition, the Bill will clarify the operation of the legislation in relation to government bodies whose enabling legislation includes a provision generally exempting the body from Commonwealth taxes. The Bill will also modify requirements relating to the lodgment with the Taxation Office of certain returns by banks. I turn now to discuss in more detail the changes proposed by this Bill. Under the present law, a public benevolent or religious institution, a public or private non-profit hospital and a government or private non-profit school, college or university is exempt from the tax. The Bill proposes that exemption also be granted to organisations whose function is to support one of those exempt institutions. The proposed exemption will thus apply to parents and citizens associations and like bodies which exist to serve the interests of particular schools. Auxiliaries set up to raise funds for a hospital or a public benevolent institution such as an aged people's home will also be eligible for exemption. Exemption will not, however, extent to umbrella support groups whose purpose is to promote in a more general way the interests of schools, hospitals or other exempt institutions not to broadly based support groups such as community service clubs. The new exemption will apply to debits made to accounts on or after the first day of the month following the month in which the amending Act receives the royal assent. The Bill also liberalises the exemption currently provided to certain government bodies. Under the present law, government bodies are eligible for exemption from the tax, except in relation to bank account debits resulting from transactions connected with a business undertaking or if their sole or principal function is to carry on a business. This policy of taxing all business activities of government bodies ensures equality of tax treatment with any private sector competitors but has meant that local councils that carry on business activities such as operating swimming pools, child care centres and caravan parks are subject to the tax in respect of those activities even where they represent an insignificant part of a council's functions and are not commercial in a real sense. Because transactions relating to such business activities are generally conducted through the council's main operating bank account, that account is not eligible for the issue of a certificate of exemption. Instead, the council is initially required to pay tax on all debits to the account and subsequently claim a refund from the Commissioner of Taxation of the tax paid on the non-business debits. The Government believes that the administrative burden in these particular situations is disproportionate to the very small amount of revenue involved. Accordingly, the Bill will extend the scope of the exemption provided to government bodies that do not primarily carry on business undertakings so that such a government body will be eligible for exemption not only in respect of its non-business activities but also in respect of any business activity that forms a minor or insignificant part of its functions. This will mean, for example, that a local council will no longer be subject to the tax in respect of business activities such as operating a swimming pool where, viewed overall, that activity represents a minor part of the council's functions. On the other hand, a council that carries on, for example, a substantial electricity supply undertaking will not be eligible for exemption in respect of debits relating to that activity. The change to the exemption arrangements for government bodies will also operate in relation to debits made on or after the first day of the month following the month in which the amending Act receives the royal assent. This Bill is also to clarify the operation of the bank account debits tax law in relation to government bodies whose enabling legislation include a provision exempting them from Commonwealth taxes. The intended operation of the existing law is that government bodies are entitled to exemption from the tax only if they satisfy the specific tests for exemption of government bodies contained within the bank account debits tax legislation. As mentioned earlier, those tests are designed to ensure that government bodies are not eligible for exemption in respect of substantial business activities. Nevertheless, legal arguments have been advanced that government bodies that carry on substantial business undertakings are completely exempt from the bank account debits tax if they have a general tax exemption provision in their enabling legislation. The amendments will make it clear that a government body will only be entitled to exemption from the tax if it satisfies the specific tests for exemption of government bodies contained in the bank account debits tax legislation. This particular measure will be made effective in relation to bank account debits occurring on or after 22 August 1984 which was the date on which the Treasurer announced that the law would be amended in this way. The final measure proposed by this Bill will vary a machinery provision in the existing legislation which stipulates that banks must lodge an annual return relating to exempt accounts specifying the names and addresses of the account holders in alphabetical order. The Bill will replace the requirement to furnish a list of account holders in alphabetical order with a requirement that the bank furnish the return in an approved form containing such particulars as are required by the form. This is consistent with the existing provision relating to lodgment of returns for taxable accounts and will assist the Commissioner of Taxation in exercising appropriate control over the system of certificates of exemption. As is usual with amendments to the taxation laws, an explanatory memorandum giving technical details of the amendments contained in the Bill is being circulated to honourable senators. I commend the Bill to the Senate. BANK ACCOUNT DEBITS TAX AMENDMENT BILL 1984 This Bill will give effect to the proposals announced in the Budget Speech to exempt debits below $1 from the bank account debits tax and to increase the tax on debits of $10,000 or more from $1 to $1.50. At present, there is no minimum debit below which the tax does not apply. This means that the minimum rate of tax of 10c is charged on very small debits including on small debits for financial institutions duties levied by some States. The Bill will ensure that debits below $1 are not subject to bank account debits tax. In order to offset the cost of the exemption of debits below $1 and the two other new exemptions announced in the Budget, the Bill proposes to increase the rate of tax on debits of $10,000 or more from $1 to $1.50. This increase, like those two changes, will apply to debits made to accounts in the month following royal assent. I commend the Bill to the Senate. Senator Dame MARGARET GUILFOYLE(Victoria)(10.10) —The six Bills before the Senate represent an important part of the Budget of 1984-85. They represent a substantial collection of government revenue for the forthcoming year. The Budget, to which these Bills are addressed, has total outlays of almost $64 billion. That represents 31 per cent of the gross domestic product of Australia and is a 13 per cent increase over the previous year. It has to be noted at the time of dealing with these revenue-raising Bills that this is a new record. It is the first time in the last decade that the 30 per cent level of gross domestic product for government expenditure has been punctured. The figure that concerns us is a figure that has risen from 28.8 per cent in 1974-75 at the height of the Whitlam Government's spending. We were concerned about that figure and that concern was justified. It is important to note that government expenditure this year represents over 31 per cent of gross domestic product. In line with that figure in the Budget, it is important to note that Budget receipts will represent almost 28 per cent of gross domestic product, at a figure of over $57 billion. That is almost an 18 per cent increase in Budget receipts. In this Budget, a record percentage of gross domestic product for government expenditure is established. There is also the substantial increase in Budget receipts as a percentage of gross domestic product. We could contrast the forthcoming year's percentage of almost 28 per cent with that in the Whitlam Budget of 24.7 per cent. It is a record proportion even taking into account those record figures that were established by the Whitlam Government. With this Budget the Government establishes control over a greater proportion of the nation's resources than even the Whitlam Government at its irresponsible peak a decade ago. Among the chief measures announced in the Budget, most of which are the subject of the Bills before us, we find personal income tax cuts of about $7.60 a week for most of the middle and lower income earners. This represents only a partial reduction of or rebate for the estimated $22 a week increase in taxation since the Australian Labor Party came to office. Also proposed in these Bills is the new restructured five-step tax scale. Even with that new tax scale and the much announced tax cuts of about $7.60 a week there is to be an increase overall in income tax collected from individuals of 23 per cent. We note that sharp contrast between a very small reduction and a very large increase of 23 per cent in income tax collections when dealing with these Bills before the Senate. In addition to the increases in personal taxes are the increases in sales tax of 10 per cent on wine and 20 per cent on very low alcohol beer. There is a decrease in assistance to export industries and many other matters which can be dealt with when debating other Bills. But when dealing with this collection of tax Bills it is important to note the figures that I have stressed. With respect to personal income tax, it is worth quoting Mr Eric Risstrom of the Australian Taxpayers Association. On an Australian Broadcasting Corporation program in July 1984 he made the comment: Over the last 12 months the tax for the typical family unit, husband, wife, two kids, who belong to a medical fund, buying a home, their tax has gone up 23 per cent. The fact that the figure I mentioned earlier is substantiated by Mr Risstrom, the representative of taxpayers in that public sense of the Taxpayers Association, bears consideration if the Government, as I am sure it wishes, talks about tax cuts. Other matters come to our attention when we deal with legislation of the type that is now before us. There is a need to look at the structure of the Budget and what it portends for the future. We need to look at Budget requirements of expenditure and then assess what can be done to relieve the tax burden on individuals, companies and businesses. It is fair to say that as part of their election platforms both the present Prime Minister (Mr Hawke) and the Leader of the Opposition (Mr Peacock) should be prepared to state what their proposals are for government expenditure targets over the next three years. When looking at the amount of tax to be raised we cannot ignore what will be the requirements of government as a percentage of GDP or in line with its Budget targets. If we are seriously ever to offer tax reduction in this country expenditure targets are the first thing that need to be addressed. A government which addresses government expenditure seriously and shows any willingness to reduce the burden of tax and cut the deficit at the same time is able to offer something credible. Some indication was given by the present Government that figures showing expenditure targets and even revenue projections would be made public. However, there seems to be some backing away from that. But that does not mean that there cannot be a commitment by government to look at expenditure and to have the objective of controlling the growth of government expenditure if we are to address properly the tax burden. The overall tax and borrowing requirements of government depend ultimately on total expenditure and it is that figure that I think is of prime importance if we are seriously to address tax reform. Expenditure targets can be practicable and can greatly improve the rationality of the budgetary process. I know only too well how locked in a government can be to expenditure requirements that relate to entitlements under various Acts, projects that have a life of some years or arrangements with the States for distribution of revenue. But this does not mean that governments cannot look at expenditure targets and seriously address the problem. The three Budgets introduced by the Whitlam Government between 1973 and 1975 showed an average increase of almost 10 per cent per annum. The Fraser Government's seven Budgets showed an average increase of 2.2 per cent and the Hawke Government's two Budgets showed an average increase of 6.9 per cent in public expenditure. I want to raise this issue when dealing with these tax Bills that seek to raise revenue for the forthcoming year. It is also timely to requote some of the statements which have been made by Ministers of the present Government with regard to taxation review. The comments of the Minister for Finance (Mr Dawkins) are reported in the Sydney Morning Herald of 16 July 1984. The article states: . . . the question of existing taxes on capital was 'firmly part of that review '- That is the review that was being undertaken by the Government- and the Government had to ensure that 'where there are taxes on capital they are effective and they are fair'. When speaking on a television show at around about the same time he said: One question is absolutely clear, that one of the reasons for the great explosion in tax avoidance was partly due to the fact that we don't have effective taxes on capital in this country. That, of course, is another means of collecting revenue by governments. It is another part of the tax mix that we will have. The present Government certainly will have to look at an effective and fair capital gains taxes in any review that it undertakes. It would be of interest to know what comment it would now make with regard to the introduction of a capital gains tax or any other form of new tax that presently does not apply. I quote again from a Minister of the present Government, the Minister for Science and Technology, Mr Barry Jones, who , after the introduction of this year's Budget, said: What I say, if you are talking about a three year Parliament, without any possibility of an early election, it means that in that three year Parliament you can spend money, you can raise money perhaps by increasing taxation, or funding new sources of taxation to do things that are expensive that you would not be game to do, you would not be keen to do, three or four months before an election. He was then asked this question: So, I take it, you are talking about increasing taxation in perhaps next year's Budget to improve the science and technology cake. He said in answer: Well, we have clearly got to look for alternative sources of revenue. That is common ground. Not decided what they will be. But a number of Ministers have said we have got to face up to the fact that we need more revenue. As Senator Robert Ray often says, we have got a Party policy that has got 195 pages on spending money and only about 5 pages on raising it. That is one of the issues that we have got to look at absolutely urgently. This observation is then made to him: It seems to me that a very tough Budget next year is on the cards. He said: Well, it is just possible. Those matters are pertinent to the Bills before us because of comments from other members of the Australian Labor Party, such as those of Mr Gerry Hand as reported in the National Times on 24 August. On 30 August the Prime Minister said: We do not believe that taxation reform will be to Australia's advantage if it involves overall increases in taxation as distinct from greater efficiency and equity in the system. The Labor Government does not believe that higher overall levels of taxation are necessary for substantial reductions in the deficit for improved equity or for enhanced efficiency of our economic system. That comment from the Prime Minister gives no indication that there are to be reductions in overall tax collection. It gives no impression that there is any serious addressing of government expenditure targets. One can only believe that there is to be a rearrangement of taxes with the introduction of some new taxes. One has the feeling that ahead of Australians lie the record figures of tax collections that we see in this year's Budget. Some of the other matters I want to raise in this debate today relate to the Medicare Levy Bill which is also before us. We cannot look at personal income tax without looking at the implications of the Medicare Levy Bill because it provides for a very direct and inescapable personal tax introduced by this Government. It has been stated that the Bill provides for a one per cent Medicare levy. It has been stated often enough by the Government that the Medicare levy is one per cent of taxable income, and that is supposed to represent in some way a Medicare insurance for the people. It is nothing of the kind. It is an identified contribution of one per cent towards health care costs . In no way is it a levy that provides health insurance or the health care that people would expect to find in this country in the forthcoming years. Indeed, the Budget Papers show that the Government is taking more like 1.7 per cent of taxable income to cover the additional costs of the Medicare program. One per cent of this amount comes from the official Medicare levy and another 0.7 per cent comes from a hidden tax increase which is not identified but nevertheless is paid for by the people, as evidenced by the figures contained in the Budget Papers. The Budget Papers show that the additional cost of Medicare is $2,021m this year. The official Medicare levy of one per cent is estimated to bring in revenue of $1,191m and that leaves a shortfall of about $830m. If we apply that calculation to the figures that are used for the calculation of the one per cent levy, we find that an additional 0.7 per cent of personal income tax must be directly required to fund the Medicare costs in this year. These figures come from the Budget Papers. I refer to a 'Health Budget 1984' corrected news release from the Minister for Health (Dr Blewett) on 22 August. He shows the 1984-85 costing of Medicare. Under the heading of additional expenditure is $1,011m in medical benefits, $ 854m in hospital payments to the States, $54m in increased payment to private hospitals, $20m in community health and $114m in administration. That latter figure is taken from the Health Insurance Commission's gross management expenses for administering Medicare. In the same statement from the Minister are figures showing that the one per cent levy will raise $1,191m, the health insurance rebate $630m and the reinsurance pool $80m-a total of $1,901m and a net outlay of $152m. He substantiates the figure of what will be raised by the one per cent levy but it is shown that that is of course a token contribution. I do not wish to use the figures in any precise way in looking at that contribution as a total percentage of health care costs because we would find they are even more of a token. It does not relate to the cost of health care in this country. It is simply an identified contribution. The health care system is of increasing importance. If, as I do, one comes from the State of Victoria and looks at this morning's Press one finds two-page advertisements advising people of the essential requirements for private health cover. In saying that the one per cent levy and the 0.7 per cent additional personal tax that directly relates to Medicare are costs to the individual one needs also to look at the fact that people have to have private insurance in order to have access to the health care that they require. Let us look at the finances of a family which has maintained its private hospital cover after the introduction of Medicare. We can take the case of a man on average weekly male earnings in, say, New South Wales of $384 a week with a dependent spouse or we can take a double income family, or any combination of incomes adding up to $384 a week. The average weekly cost of health insurance on the most commonly used private table of three major funds in New South Wales, after the deduction of the 30c in the dollar tax rebate applying before Medicare and allowing for the consumer price index adjustments to insurance rates to bring them up to an assumed May 1984 level, is $11.64 a week for such a family. After Medicare the average weekly cost of the three funds for the same level of private cover, excluding medical cover which is now covered by the levy, is $8. 77. Of course, there is no tax rebate. We need to add to this the one per cent Medicare levy of $3.84 a week plus the additional levy of increased personal tax of 0.7 per cent, which is $2.69, and we therefore get a weekly outlay in total of $15.30 as against the original $11.56 which that family would have been required to pay. So for that family there is an additional cost of $3.74 a week. In those figures I have not taken into account the likely additional cost of meeting the uninsurable gap between the schedule fee and the Medicare rebate for medical services which could add quite substantially to the extra costs if there was chronic illness in such a family. Again and again we hear of concern about the availability of or access to hospitals in some States being worse than in others. In Victoria it is of extreme concern. In that State about one-third of the hospital beds are in the private sector so it is essential for people who require access to hospital to have private cover. It is pointless for the Government to look at a one per cent levy, talk about that as the cost of Medicare, and say that it has fulfilled a promise given that health care will be cheaper for Australian families. It is a claim that was made but which has not been substantiated, and the people know it . The claim that nine out of 10 Australians will pay less for the same cover was always misleading. The Government had no capacity to deliver on that promise and it should not have made it. It is certainly no pleasure to point out that Australians have been deluded by the Government and that they have serious concern about their health costs, their health cover and their access to the health services that they require. The claim in the Medicare leaflet states: Medicare will be paid for by a one per cent levy on your taxable income. To state that baldly without saying that there will be an added increase to personal taxes to cover it, that there is a gap between what that one per cent will provide and the Minister's own figures on the additional expenditure for Medicare, shows that that token one per cent is not something that can be substantiated as being important. The Budget Papers tell us that medical and hospital benefits have risen by over $2,000m compared with the old scheme. The levy that brings in the $1,191m does leave that shortfall that I mentioned. I think that the Government's future proposals with regard to the funding of the Medicare program are very important in terms of personal taxes that are required from the Australian people. The Minister's commitment to maintain the levy at one per cent is quite meaningless because the one per cent is paid as an identified contribution to it but that in no way meets the requirements of the additional cost. At the same time we find that people have to pay additional personal taxes that are directed towards Medicare, as well as the additional cost of their private health insurance. We could raise the point at this stage as to why we need to stress the cover that people will require for private hospital insurance when the Medicare leaflet tells us: If you go to a public hospital, Medicare will provide free accommodation and treatment by doctors appointed by the hospital. It has been obvious throughout the whole of the health debate over the last decade that one reason why people want to maintain private cover is that they wish to choose their own doctor or to change their doctor if they were dissatisfied. Anyone who has gone through a period of serious illness and has not been totally satisfied with the attention that he or she has received will understand why so many people consider that being able to choose their doctor is worth the extra insurance cost. However, those who have met the cost rightly become infuriated when they find that a person on equal or greater income, who has not insured privately, is charged nothing for a public hospital bed, while the insured person, through his or her insurance fund, is charged $80 a day by the same public hospital for the same kind of bed. That is one of the real questions that need to be addressed in the way in which the structure of the Medicare program has been developed by the present Government and the objectives of the Government in structuring it in that way. The real question to be asked is: Will a bed be provided if a patient is uninsured, as promised by Medicare? The answer, of course, must be that the bed may be free but it is available only at the end of the queue. In Victoria at the moment there are something like 8,000 patients on waiting lists for public hospitals. I think I heard my colleague Senator Reid this morning introducing a matter that is of concern to her with regard to elective surgery in the Australian Capital Territory. There are two-year waiting lists for orthopaedic work in public hospitals in Victoria, and this is quite reminiscent of what happened in the British national health scheme. It provides free health at the end of a queue for the poor and the inarticulate. The organised and the articulate will manipulate the system to get ahead of the queue. There can be the use of influence, and influence is being used every day already in Australia to get around the Medicare rules. This is not the kind of health system that there should be in this country. Those who can afford private health insurance are occupying the beds that the poor and the inarticulate cannot obtain, and those who are most in need are left out in the cold, because those who are in need and who are subject to the levy in some cases are unable to find the extra funds that are required for private health insurance. The Health Minister, in his letter to those compulsorily enrolled, congratulated them on becoming members of this compulsory health scheme and said : 'You are now enrolled with Medicare, the simplest and fairest health insurance scheme Australia has ever had'. There are several matters that could be questioned in that statement by the Minister. The first one is: Is it simple? Previously Australians could get all their health insurance in the one place, at the one shop. It they now wish to continue with private health cover they have two-stop shopping. They have to go to the private health insurance office and also to a Medicare office. Medicare offices are few and far between in some locations. The second question is this: Is Medicare fair? The chronically ill cannot insure for the gap and they find it difficult to pay for the gap. There is a $ 150 limit, but that applies only to individual patients. If there are a number of children in the family it is necessary for each one to get to the limit before claiming the 100 per cent rebate. In addition, it is administratively complicated to deal with this system because unless one pays the full bill and receives a receipt before going to the Medicare office, it is complicated to get that gap recorded in the computer and if it is not recorded it does not apply. One must also ask: Is it fair when the elderly and chronically ill, after years of membership of funds, find that because of the reduction in the Government reinsurance subsidy of $80m they are denied the private cover they expected? When they are most in need they find that there are limits to the number of days that they are privately covered, even though they have paid into funds for years . That raises the question whether it is fair when the long term sick, many of them elderly, are forced out of public or private hospitals under the 35-day rule or have to pay a great deal out of their own pockets for additional insurance. There are many other matters that could be raised about the fairness of the scheme that has been introduced by the Government, but those are matters that can be raised at another time and perhaps in another debate. But in dealing with the Medicare Levy Bill before us, I think it is important to say that Medicare can damage the whole system of health care delivery, built up to a very high standard over the last century. It is destroying the motivation of those working in the system to provide good service and to achieve excellence. Public hospital budgets have been squeezed to the point of inefficiency, poor patient service and loss of staff morale. Private medical practitioners whose contribution to health care is a vital ingredient of the quality of the Australian system have been attacked professionally and financially and are subjected to unwarranted abuse by the Prime Minister (Mr Hawke), who compared them with members of the Builders Labourers' Federation, by the Federal Health Minister and Labor State Ministers. It is fair to say that in all States there is concern by State Ministers and Premiers about the provision of hospital services. There are instances of difficulties with staff, whether they be nursing staff or other staff. There have been disruptions in hospital service to individuals, particularly in Victoria, where it has been of continuing concern and remains so . The claim that Medicare has provided a simple system and that nine out of 10 people are having a cheaper health cover is something that could be refuted on almost every count. Medicare-the whole program and the cost to the individual-is not something to make us rejoice as we deal with these Bills. The other Bills that are before us relate to companies' superannuation funds, bank debits, tax and other matters in the cognate debate and I address no remarks to them, other than to say that they are revenue-raising matters of the Government's Budget. Because these Bills represent such a substantial increase in taxes and are such an important part of the Budget, we do not oppose them. We point to the difficulties that individuals will have in meeting the increases in taxes and we point to the anomalies that there are in the introduction of the Medicare system which we believe will be a lasting problem unless some of the matters which have become self-evident to the Minister, I am sure, are addressed in the near future. With these comments, I say that these Bills are not opposed by the Opposition. Senator PETER BAUME(New South Wales)(10.40) —Like my colleague, Senator Dame Margaret Guilfoyle, I address my remarks to the Medicare Levy Bill 1984 which is one of the Bills in this package now being considered. The Medicare Levy Bill is part of a package of income tax measures which, taken together, combine to make this Government, the Hawke Labor Government, the highest taxing government in Australia's peace time history. The public should be aware of and remember that- it is the highest taxing government in Australia's peace time history. The one per cent levy which this Bill imposes upon household incomes allegedly to cover the costs of Medicare provides only part of the revenue required to cover the costs imposed by this system of health insurance. It is true that this levy will cover some of the costs but it will not cover them all. It is a further measure of the deception which this Government so happily practises that it would have us believe that the one per cent levy meets the costs of Medicare, or that the costs of Medicare can in some way be related to or thought to be equivalent to what the levy returns. The fact is-the Government's own Budget Papers demonstrate this-that 1.7 per cent of taxable income is being taken from Australian taxpayers to cover the additional costs of Medicare. One per cent is being taken by way of the levy and another 0.7 per cent is being taken from Consolidated Revenue, from general taxation. So the Australian taxpayer is paying twice-once by way of a levy, which is identified, and a second time out of his or her general taxation, which is not identified as part of the cost of Medicare. It is what one might call the imposition of a secret additional levy of 0.7 per cent of personal income tax. Of course the whole Medicare exercise has been an example of further tax imposition upon the Australian people, and when one talks about the taxation measures of the Hawke Government, as my colleague Senator Dame Margaret Guilfoyle says, one must look at the taxes in the Medicare area as part of the personal income tax package, as part of the personal income tax burden. The Budget papers show that the additional cost of Medicare is a bit over $2,000m. The official Medicare levy of one per cent is estimated to bring in revenue of just under $1,200m, leaving a shortfall of about $830 which still has to be found from the pockets of taxpayers, still has to be found from revenue and of course has to be found by way of other taxation. It is meaningless for the Minister for Health (Dr Blewett) to claim that the Medicare levy can be maintained at one per cent and that this will go any way towards covering the costs which this system of health insurance imposes. This is as meaningless a claim as any other of the claims made by the Hawke Government in respect of Medicare. In the policy speech of the Prime Minister (Mr Hawke) in 1983, voters were told, quite explicitly: . . . nine out of ten Australians will pay less for the health needs of themselves and their families. That is what Mr Hawke promised to the people when he wanted their votes, when he wanted their support. Of course it was never possible. It was never on. It was never an accurate promise and it did not take Mr Hawke long to resile from that commitment. In the letter to all Australians sent out before the introduction of Medicare we had a good example of the mathematical acrobatics that this Government is so fond of practising. We were told in that letter: Two out of three families will be paying less for the cover that they now enjoy. However, in the policy speech we were promised that the figure was nine out of ten families, because it was necessary in the policy speech to make the promises extravagant and attractive, whether or not they were truthful. It did not take long for the Government to go from a promise of nine out of 10 families to a promise of two out of three. Of course in practice the Prime Minister has delivered on neither of those promises. Individual families which have decided to maintain their private health insurance-many have found it necessary to do that as they witness the mediocrity and inadequacy of the provision of services under Medicare-are, in the majority of cases, worse off than they were before. It is a simple matter of arithmetic. They are worse off. Yet this Government promises that two out of three would be better off. It is true only if they are prepared to take a lesser standard of service or lesser access to medical and hospital services. These people pay their one per cent levy. On top of that they pay their private health insurance premium. They have lost the tax rebate which they previously enjoyed on basic health insurance contributions. They are prevented by law from insuring to cover the gap between the schedule fee and the Medicare benefit. So in four areas they are paying. Therefore, they have to meet all those costs from their own pocket each time they visit their doctor. There are now restrictions on the number of days one can spend in hospital without incurring very heavy out of pocket expenses. This is a matter of particular concern to the elderly and the chronically ill. It is simply quite fraudulent of this Government to claim that Medicare is cheaper, it is simpler and it is fairer. It is not cheaper, it is not simpler and it is not fairer. How can it be cheaper when the levy raises only part of the costs? I suppose one could set the levy at a tenth of what it is now and claim from that that it is cheaper. The only point is that one would still have to make the difference up from Consolidated Revenue. The estimated total cost of the health systems in Australia to State and Federal governments is somewhere between $9,000m and $10,000m. Of this the Commonwealth will provide about $5, 500m from taxpayers' funds this financial year. I just give ball park figures to set the scene. The Medicare levy of one per cent pays for only about one-eighth of total government expenditures on health, both State and Federal, and about one-fifth of the Federal expenditures on health. To try to equate the level of the levy with the costs of medical services is an exercise in futility. The balance of the cost is paid by taxpayers. It is just not made explicit to them. Unless it is brought to people's attention they may not realise that not only are they paying the one per cent levy but also part of the tax which they pay each week, as pay as you earn taxpayers, is going to make up what the levy does not cover. The Government would have us believe that the levy covers all health costs. It does not. Mr Hawke and Dr Blewett claim that Medicare is simpler. This claim also sits strangely with the facts. Two-stop shopping is required if one wants private cover to be maintained. That is not simpler; that is more complex. Medicare offices are not widely distributed. One could even say that they are few and far between, particularly in non-metropolitan Australia. That does not make it simpler. Medicare confiscates one's doctor's bills. That does not make it simpler. The Government would claim that Medicare is fairer. Let us consider a few facts. The chronically ill cannot take out gap insurance. Is that fairer? Is that fairer for the chronically ill? Let us consider the fact that the hospital reinsurance subsidy has suffered a cut in real terms of about 6 per cent. As a result health funds have been forced to limit hospital cover of contributors to a set number of days each year. Is that fairer? Not only is Medicare grossly unfair to those using the system; it is unfair to those responsible for health care delivery. To appreciate this one has only to refer to the unprecedented strike action by members of the medical profession over conditions which were being imposed upon them quite unfairly by the Hawke Government and through the State governments and the confrontation which took place in my State of New South Wales and which led to the Wran Government retreating in the face of what was justified and united opposition from doctors. These conditions would have been totally unsatisfactory for any member of a trade union. This Government, which is thought to represent people who work, seems to have a set against the medical profession. I have heard honourable senators opposite frequently propose that doctors should settle for the 85 per cent rebate and consider themselves well off by so doing. I have yet to hear them asking members of the Amalgamated Metal Workers and Shipwrights Union to take a 15 per cent cut in their gross income. Senator Dame Margaret Guilfoyle —Or the BLF. Senator PETER BAUME —Or, as my colleague Senator Dame Margaret Guilfoyle says, the Builders Labourers Federation. This Government is selective in those it asks to bear the burden. Because of its own ideological hangups it has decided to have a go at the doctors through Medicare. I must say that the confrontation in New South Wales had the Labor governments retreating, and in full flight. It was not a bad thing to see. What has been so outstanding since the Australian Labor Party came to office has been the way in which it has sought to denigrate the medical profession at every opportunity. By extending the system of bulk billing the Government is also asking the profession to settle for the rebate and to take an effective pay cut of 15 per cent. The Medicare Levy Bill is only one of this package of Bills, but it is a Bill which makes quite clear that the Hawke Labor Government is a high taxing government. It is a high taxing government in the area of income tax. It is a high taxing government because of its failure to deal with fiscal drag and because of what it has done in the Medicare area. Although, as my colleague Senator Dame Margaret Guilfoyle said, we will not be opposing the Bills, we draw these matters to the attention of the public as we believe the Government has many things to answer for and many things which should be brought to the judgment of the people. Senator WALTERS(Tasmania)(10.52) —I find it very interesting that the Government has not put up the names of any speakers for the speakers list on this legislation. A package of taxation Bills is before the Senate and so far the only speakers have been Senator Dame Margaret Guilfoyle, Senator Peter Baume and me. I note that only one member of the Government is prepared to speak in support of the Government's taxation Bills. Only one Government back bencher is willing to speak in support of the Government's taxation Bills. We will see how far the Bills get. I find it very interesting that Government members are not prepared to support the Government on its taxation levies. I too will speak to the Medicare Levy Bill. Senator Dame Margaret Guilfoyle covered the taxation Bills in the other areas very effectively. We were told that the Medicare levy was to be one per cent of taxable income. It was thought that meant the levy was to be imposed on all income over and above $4,595 per annum, at which point income becomes taxable. That is not so. Income for the levy is taxed from the first dollar. We were also told that provision would be made for low income earners and that once they earned above a certain figure the shading in would be done in a very just and sensible way. I will point out some of the anomalies that exist. The levy in some situations is not one per cent but 20 per cent. We do not hear any great noise from the Government members or indeed from the Minister for Social Security, Senator Grimes, on this. The Parliamentary Library has given us a paper-- Senator Maguire —Twenty per cent? Senator WALTERS —Yes, 20 per cent. If Senator Maguire does not understand the situation he should not be the back bencher who is to speak to this Bill on behalf of the Government. Let us look at how that situation arose. I refer to the situation in which a single person with a taxable income of $7,000 is exempt from the levy. When the taxable income reaches $7,450 the levy is increased considerably. As this paper points out a levy amounting to 20 per cent of the difference between $7,110 and $7,450 is applied to that single income person. On an additional $340 earned that single person pays $68 on the levy alone. This does not include other income tax. We on this side of the chamber will be interested to see whether Senator Grimes will deny these figures. I will be most interested to see whether he will deny them. We then find that if this person's income goes up a little more, indeed if that single person earns an additional $375, he pays $74.85 out of that $375. That is a 20 per cent levy. That amount covers the levy alone not the total tax paid. We find that a married couple on a taxable income of $12,300 pays 20 per cent on the difference between the non-levy amount, which is $11,803. So if an additional $497 is earned the family pays a levy of $99.40. That is nearly $100. That, I stress again, is not the total tax; it is purely the Medicare levy. Senator Giles —It is a figment of your imagination. Senator WALTERS —Senator Giles obviously does not have a clue. She says it is my imagination. I have just pointed out to her that this is a paper put forward by the library of the Parliament, headed 'Medicare Levy-How it Works'. The paper was not prepared by me or the Opposition. It was prepared by the library, which I presume Senator Giles and Senator Grimes have faith in. If they do not have faith in the library of this Parliament they had better stand up in this place and say so and not do so by interjection. We will see whether the Minister will deny that these figures are correct when he gets on his feet. I will be asking the Minister for permission to table some of these papers. Senator Grimes —You can table what you like because we want to see the interpretation that you are putting on them. Senator WALTERS —I thank the Minister. I shall be tabling them by leave. The Minister is now backing off and agreeing that the library papers are indeed accurate. We will be interested to see how he goes. I will refer to the anomalies created by this levy. As I have said, at times the levy amounts to 20 per cent. Let us have a look at how the Government deals with families in this regard. I will take an example in the paper that I wish to have incorporated, not tabled. Senator Grimes —You can incorporate your whole speech, if you like. Senator WALTERS —Fine. I seek leave to have this paper incorporated in Hansard. Leave granted. The paper read as follows- PARLIAMENT OF AUSTRALIA The Parliamentary Library LEGISLATIVE RESEARCH SERVICE MEDICARE LEVY-HOW IT WORKS EXEMPTION FROM LEVY FOR LOW INCOME EARNERS Taxpayers whose taxable incomes fall below a certain level are not required to pay the levy. Those levels are known as low income thresholds and are singles $7,110; married couples (or de facto couple) and single parents $11,803; The low income thresholds are increased by $1,330 for each dependent child or student. A ''shading in'' mechanism operates on incomes slightly in excess of the low income thresholds. The ''shading in'' ranges are: Single-$7,110 to $7,484; Married couples and single parents $11,803 to $12,424. Therefore if the income of the individual or couple is within their shading in regions the levy payable is 20 per cent of the excess of taxable income over $7, 110 and $11,803 (adjusted for dependent children) respectively. People whose only income is the aged pension fall below the low income thresholds. THE FAMILY INCOME THRESHOLD The Family Income Threshold (FIT) is calculated to see whether (1) couples, married or de facto, and (2) single parents who are entitled to an income tax rebate as a sole parent, or for a daughter-housekeeper or a housekeeper, are required to pay none, some or all of the Medicare levy. for example, the FIT for a couple or single parent with one dependent child is $11,803 plus $1,330 = $13,133; in this case the upper limit of the shading in region would be $12,424 + $1,330 = $13,754; therefore if combined income is: below $13,133, no levy is due; between $13,133 and $13,754, a levy of 20 per cent of the amount in excess of $ 13,133 is payable; more than $13,754, a levy of 1 per cent of taxable income is payable Examples-1. Single person: taxable income: $7,000; levy: zero. 2. Single person: taxable income: $7,450; levy 20 percent of ($7,450-$7,110) = $68. 3. Single person: taxable income : $7,485; levy: $74.85. Examples 4, 5 and 6 concern couples with only one income earner and no dependent children. 4. Couple: combined taxable income: $11,700; levy: zero. 5. Couple: combined taxable income: $12,300; levy: 20 percent of ($12,300-$11, 803) = $99.40. 6. Couple: combined taxable income: $12,425; levy = $124.25. MARRIED TAXPAYER (ONE OF COUPLE ONLY EARNS INCOME) AND SOLE PARENTS 1984-85 No One Two Three Four dependent dependent dependent dependent dependent children child children children children or students or students or students or students or students $ $ $ $ $ Family Income Thresholds Phase in Range 11,803 13,133 14,463 15,793 17,123 to to to to to 12,424 13,754 15,084 16,414 17,744 Taxable Income of Income Earner or sole Parent 12,000 39.40 . . . . . . . . 13,000 130.00 . . . . . . . . 14,000 140.00 140. 00 . . . . . . 15,000 150.00 150.00 16.80 . . . . 16,000 160.00 160.00 160.00 82.80 . . 17,000 170.00 170.00 170.00 170.00 . . 18,000 180.00 180.00 180.00 180.00 180.00 19,000 190.00 190.00 190.00 190.00 190.00 20,000 200.00 200.00 200.00 200.00 200.00 VARIATIONS IN LEVY The following is based on an annual income of $15,000. The examples below show how the Medicare levy varies from household to household according to a number of factors: the number of income earners; the number of dependent children or students; if there are two incomes, how the total income is composed. (i) Single person: income: $15,000; levy: $150. (ii) Couple: one income: $15,000; levy: $150. (iii) Couple plus one dependent: one income: $15,000; levy: $150 (iv) Couple-no dependents: one income $7,500; other income $7,500; total income $15,000; levy: $150. (v) Couple-no dependents: (a) one income $10,000; (b) other income $5,000; Total income $15,000; levy on (a) = $100; levy on (b) = zero; Total levy = $100. (vi) Couple-no dependents: (a) one income $8,000; (b) other income $7,000; Total income $15,000; levy on (a) = $80; levy on (b) = zero; Total levy = $80. (vii) Couple-two dependents: one income $15,000; Family income threshold = $14, 463; phase in range $14,463 to $15,084; levy is 20 per cent of ($15,000-$14,463) = $107.40. (viii) Couple-two dependents: one income $7,500; other income $7,500; as singles both income earners would have to pay a levy of $75 each, but as a couple with two dependent children, their FIT is $14,463. The couples total levy is $107.40. (ix) Couple-two dependents: (a) one income $10,000; (b) other income $5,000; as singles, income (a) would face a levy of $100 and income (b) would pay no levy- total levy $100. FIT is $14,463 and as couple they would face a levy of $107.40; the single levy rate is therefore, applied. Education and Welfare Group 2 October 1984 Legislative Research Service Senator WALTERS —I thank the Senate. This paper refers to incomes of $15,000. The levy on a couple with one dependant and one income will be $150. I now take a couple with no dependants. One income earner in that family earns $8,000 and the other $7,000. Their combined income is $15,000. This couple has no dependants and a total income of $15,000. Because one person earns $8,000 and the other $7,000 the levy is $80. It is not $150 but $80. A couple with no dependants on a total income of $15,000 pays $80 a year. A couple with one dependant child and the same income pays $150. Let us have a look at a few more anomalies. I take now a couple on a single income of $15,000 a year, with two dependants. That couple's levy is $107.40, whereas the previous couple I mentioned on the same income but with no children is paying $80. That is exactly the sort of thing that this Government is doing to families, and is doing so repeatedly. Senator Giles, Senator Maguire and Senator Grimes not only could not care less but also try to deny it. Senator Maguire raises his eyebrows and seems to be saying to me: 'Paying 20 per cent, you must be mad'. Senator Maguire —I said nothing. Senator WALTERS —He said that because he is not aware of what is going on. That is why he has been hoodwinked. He has not done his work. He has not asked the library to do an independent paper that will tell the people of Australia the truth. He just absorbs all the guff from Senator Grimes and the Minister for Health, Dr Blewett. Let us have a look at just what this levy is. We have been told that Dr Blewett does not believe that there is any need to increase the levy. He made that very clear. He said so in a news release. The article was headed 'Medicare levy rise unlikely'. It continued: Australia's Medicare levy was unlikely to rise from the present 1 per cent, the Federal Health Minister, Dr Blewett, said in Brisbane yesterday. Of course it is unlikely to rise. The increase in Medicare expenditure in the last Budget was $2,021m. The levy raises $1,191m. Therefore there is a shortfall of $830m. That is a shortfall for additional Medicare costs, and Dr Blewett says he will not increase the levy. Why should he? All he has to do is take the additional amount out of Consolidated revenue, out of ordinary taxes. Indeed, that is exactly what he is doing. We were promised by Dr Blewett, in his second reading speech, that the levy would be identified on every one's pay slips. That has not been done and it will not be done. I have sought answers and I have been told there were technical difficulties in carrying out the Minister's promise in his second reading speech . These technical difficulties mean the Government would lose the opportunity honestly to put before the Australian people just what is happening and to inform them just what they are paying in the way of the Medicare levy. The Medicare levy has indeed gone up-to 1.7 per cent. The additional 0.7 per cent has been taken out of Consolidated Revenue, if you like, or the levy has been increased. We really do not know which, because the Medicare component is not identified on pay slips as the Minister told us it would be. Indeed, we have been told that nine out of 10 Australians would be better off under this new system. Ask the Queenslanders. They have always had a free hospital system. Ask the Queenslanders. They know they are not better off. They are well aware of that. Ask the people who privately insure for private hospitals so that they can at least get into the hospital and have their surgery done. They represent over 50 per cent of the community so ask them. They know they are paying the levy as well as private hospital cover. They know they are paying 15 per cent of the schedule fee and they know that they are not better off. The Government also knows they are not better off but the Prime Minister ( Mr Hawke) and indeed Senator Grimes and Dr Blewett still say that nine out of 10 Australians are better off under Medicare. We will see what Senator Grimes says in answer to that. I wonder whether he will answer that point. He will not answer that. He will pick the bits he does want to answer and he will not answer that. Let us consider the waiting lists that this great Medicare system has created. We know that in Senator Grimes's own area in Launceston the Examiner reported the hospital backlog in Tasmania is now 3,500, as reported by the Examiner. Senator Robert Ray —Do you believe that? Senator WALTERS —We know it is a fact because Tasmania has at least done its figures. We also know that Dr Blewett said that if that figure of 3,500 is accurate there is a lot of bed wastage in Tasmania because Tasmania has many public hospital beds. The Minister is so lacking in understanding of the situation in Tasmania that he believes that because we have a tremendous backlog and waiting list at the main hospital in Hobart we ought to be able to send patients up to Burnie to fill the public hospital beds there because they are not full. This demonstrates the stupidity and lack of knowledge that the Minister has of the various States. We cannot ease the backlog using that sort of method. I find some of the other headlines most interesting. In the Australian of the 22nd of this month is a headline 'The wait for surgery now up to 12 months'. That article reported that in Victoria up to 30,000 people are now waiting for elective surgery. Thirty thousand people cannot get into hospital to have hip replacements, cataract removals or any of the surgery that creates a better quality of life for the people of Australia. The Government talks about elective surgery as though it is not the sort of surgery that is necessary, that people just want it and do not really need it. The article in the Australian reported: Dr Horvath said people seeking elective surgery could wait up to 12 months. Lists were re-arranged daily to give precedence to emergencies. 'For example, if you are a little old lady with cataracts, you may have to wait between six and nine months . . . Members of the Government laugh at the fact that little old ladies with cataracts have to wait six to nine months to have their cataracts removed because Medicare is forcing people into the public hospitals and emptying the private hospitals. The situation is such that the Victorian Minister of Health, Mr Roper, is making contracts with the private hospitals to alleviate the position by taking in some of the public hospital patients because the flood that this Opposition warned the Government about is occurring. I refer to the flood of people into public hospitals because the Government is forcing them to pay the levy and they are unable to take out private health cover as well. It is a tragedy. Although we received congratulations from the Prime Minister on our entry into the best health system ever devised, his own Health Minister is not willing to abide by that system for his own family. He did not consider it good enough for his daughter. I do not blame Dr Blewett one bit for demanding a better system for his own daughter to have her appendix out. I do not blame him one little bit because that is exactly what I would do. I would want the doctor of my choice for my daughter if she needed to have an emergency operation. I do not blame Dr Blewett for that, but I do blame him for saying that what is good enough for the rest of the people is not good enough for him. That is the tragedy of this Government. We should consider also the one per cent levy we did not realise was to be put on lump sum superannuation payments. Did the people of Australia realise that the money they have put away for their superannuation, perhaps for 40 years in the work force, would attract a one per cent levy? Did they realise that a one per cent levy would be put on their lump sum superannuation payment? Of course they did not. They had no idea that these are the sorts of things that Mr Keating's people are gradually pulling to bits. The people are gradually wheedling these facts from the Treasurer and Dr Blewett. If we consider what people in other countries around the world pay for their health care, we find that in the United Kingdom-and nobody in this place would suggest that the United Kingdom is a country we should follow in the health sphere-people pay 6 per cent of gross national product on health. I wonder whether Government members know what we pay. Do they have any idea? There is complete silence from the Government benches. Government members have no idea what we pay for health as a percentage of our gross national product. The figure, for their interest, is 8.6 per cent. We are well above the United Kingdom figure. We pay 8.6 of our gross national product for the honour of a health system that does not allow people to get into hospitals for elective surgery such as hip replacement or cataract removal in under 12 months. It is the sort of health system that the Minister for Health does not consider good enough for him and his family but considers good enough for Australia. Let us consider how Dr Blewett handled Medicare. A headline in the Australian reads 'Government's figures that caused doctors' strike were wrong'. The Government gave the Penington Inquiry into Rights of Private Practice in Public Hospitals which it set up completely wrong figures. I cannot hear any interjections now. We are told that there was a 100 per cent increase in the use of pathology services. The article states: Commonwealth Department of Health documents presented to the Penington Inquiry into rights of private practice in public hospitals grossly overstated the use of pathology and doctors' income derived from the service, it was confirmed today. The article pointed out that the figures on pathology utilisation indicated an increase of over 100 per cent between 1975 and 1983 and a substantially greater income for doctors in that area. What was the true figure? It was not 100 per cent. The true increase was 39.6 per cent. I think that that claim by the 800 was either deliberate or there was gross irresponsibility and maladministration. Someone should be called on to answer such a charge. We had a situation where doctors had to go on strike for the first time in the history of this country. The Government gave the Penington inquiry figures which were not just a bit wrong. The Department of Health told the Penington inquiry that the use by doctors of pathology services had increased by 100 per cent between 1975 and 1983 and that as a result their incomes were increased. But the figure was really 39.6 per cent. That is an absolute disgrace. Is it any wonder that the report of the inquiry said that the whole thing was wrong, that changes must be made to Medicare. Another newspaper article carried the headline 'Penington calls for Medicare changes'. Is it not a tragedy that we are finding this sort of thing? Apart from that sort of doctor bashing we find that the Government has also been doing some doctor bashing, as the whole of Australia knows, in respect of fraud. We have a situation in which the Department says that the doctors have been defrauding the country of millions of dollars. Then a professor of statistics at Macquarie University comes out and says: 'As a scientist I object most strongly to public policies being formulated on the basis of improper studies'. He says that the only basis for the figures that the Government had put out was 'expert opinion' of members of the Department of Health. We all know what 'expert opinion' means in respect of the Department of Health. Anyway, he says that the only basis for the figures is expert opinion of members of the Department of Health supported by a statistical calculation that is both irrelevant and misleading. So we have a professor of statistics coming out and saying that the Government is putting out figures that are irrelevant, misleading and have no basis and that as a scientist he objects very strongly to this situation. This is only one more area in which incorrect figures are being put out by this Government. We have the Penington inquiry saying that it was given figures that were wrong. The figures were so disastrously wrong that the inquiry came out and said that Medicare has to be changed. We have a professor of statistics at Macquarie University coming out and saying that the Government is being misleading and that as a scientist he objects very strongly to this sort of abuse. The people of Australia know that they have been hookwinked in respect of the Medicare levy. Unfortunately they are committed to it. But we have promised that we will change it. As I said, we have told the people of Australia that Mr Hawke's statement that nine out of 10 people will be better off is obviously a falsehood. We have told the people of Australia that after the next election we will alter the system. Senator MAGUIRE(South Australia)(11.20) -I wish to speak today on the Income Tax (Rates) Amendment Bill and the Medicare Levy Bill which are being debated cognately. In doing so, I first welcome the major initiative of the 1984-85 Budget to introduce the five-step income tax scale. This scale replaces the former three-step scale which prevailed from 1978 until this year as a result of changes made by the former Fraser Government. One of the really major features of the new income tax scale is that we will now have a 25c in the dollar marginal tax rate. According to my research, this is the first time since 1977- 78 that we will have a marginal tax rate of income tax below 30c in the dollar. It was only after February 1978 when the Fraser Government introduced the three- step tax system that tax rates went to 30c in the dollar and above. Prior to that time 27c in the dollar was the prevailing tax rate. In four weeks time, from 1 November, Australian taxpayers will benefit from reductions in income tax brought about largely as a result of the initiative in this Budget to restructure the scale, to introduce five steps in the tax system and particularly to introduce the all new 25c in the dollar tax rate. That rate will apply on all taxable incomes up to $12,500. Of course, it will mean significant tax cuts for lower and middle income earners. The new rate on the first $12,500 of income will also apply to much higher incomes as well-to the first $12,500 of higher incomes. From 1 November Australian taxpayers with taxable incomes of up to $28,000 will receive, as a result of this legislation that is now before us, tax cuts of $7.60 a week. Of course, $7.60 a week in income tax cuts will benefit, as I said earlier, lower and middle income earners . This seems to be the reverse of the policies of the Fraser Government which tended to structure its tax changes so that the only advantages really went to the high income earners who tended to get much larger absolute tax cuts than did lower and middle income earners. As a result of this Budget the 25c in the dollar tax rate will prove to be a great advantage to lower income earners in particular. I am surprised that members of the Opposition have not highlighted the 25c in the dollar tax rate because for years I have listened to them both in this place and outside talking about the need for incentive in the community. Here is a tangible move in the 1984-85 Budget to reduce the tax rate to a low figure. Yet, members of the Opposition are silent on this matter of a new tax rate which, for the first time since 1977-78, is below 30c in the dollar. The Income Tax (Rates) Amendment Bill seeks to structure the reductions in income tax so that the largest benefits proportionately go to those on the lowest incomes. It is possible to calculate that as a result of the changes in the 1984-85 Budget brought down by the Hawke Government people on the lowest taxable incomes will receive a 17 per cent reduction in their taxation liability this financial year compared with last financial year. I think that all honourable senators will agree that a 17 per cent reduction in income tax liability is a very large reduction indeed. When we look at the aggregate global figures for Australia, it can be calculated that in this financial year the tax changes as a result of this legislation will cost the Budget revenue $1,300m, a very large sum indeed, and in a full financial year-because the tax cuts operate only from 1 November this year-the cost to revenue of the taxation changes will be over $2 billion; in fact, $2,100m. So it can be seen that the taxation changes as a result of the legislation bring about very real tax cuts. It is possible to calculate that the $7.60 a week reduction in taxation for most taxpayers is equivalent to about a four per cent nominal wage rise for wage earners. In one Budget, by reducing taxation and increasing disposable incomes, we have in effect granted a 4 per cent nominal wage rise. That is quite a significant increase in one move. The tax cuts, of course, provided for by this legislation are part of the overall prices and incomes policy, known as the accord, which was agreed between the Government and the Australian Council of Trade Unions. These taxation reductions are designed to give further life to and a further strengthening of the prices and incomes policy which has proved so successful in this country. In effect the taxation reductions to some extent are in place of the money wage rise which would have otherwise resulted from the consumer price index, had there been a rise in the index in the last six months. The important thing about the accord is that it is enabling the Australian economy to expand, but with lower inflation than applied under previous governments. That is the essential difference between this Government and the Fraser Government which had contractionary economic policies, rising unemployment and very high levels of inflation. The taxation reductions of $7.60 a week, equivalent to a 4 per cent money wage rise, should be seen in the context of the prices and incomes policy. One of the really important effects of the new 25c in the dollar tax rate is that it means that existing taxation rebates go further in freeing taxpayers from tax liabilities. I simply instance the dependent spouse rebate which has been the subject of some discussion this morning. That rebate of $830 for a married couple and $1,030 where children are involved will now free more taxpayers from a taxation liability as a result of the introduction of the 25c in the dollar tax rate. According to my calculations, under the previous Government the dependent spouse rebate cancelled out taxation liabilities for those with taxable incomes in the vicinity of $8,000. But as a result of this new tax rate of 25c in the dollar which has been introduced in this Budget, people with taxable incomes of up to $8,700 per annum will no longer pay tax. That is a very large reduction. I think most honourable senators would agree that there would be many hundreds of thousands of Australians whose taxable incomes would be in the range of between $8,000 and $8,700. That, of course, is a very big step forward in freeing many Australians from taxation liabilities. In relation to the $250 pensioner tax rebate which is in existence, the 25c in the dollar tax rate will also mean that more pensioners will no longer be liable to pay income tax. It is very easy to calculate that the 25c in the dollar tax rate, in concert with the $250 pensioner tax rebate, will mean that pensioners with incomes of up to $106 a week will now no longer pay tax. Senator Messner —Have you done the sums on that and found out how many pensioners will be paying more tax? Senator MAGUIRE —We have certainly done our sums and I wish Senator Messner would do his on occasions. I will repeat the figures. Senator Messner —Madam Acting Deputy President, I raise a point of order. Senator Maguire has referred to documents which he has in his possession which set out these sums on taxation. I call upon him to table those at this stage. The ACTING DEPUTY PRESIDENT(Senator Coleman) —There is no point of order. Senator MAGUIRE —I repeat that the $250 pensioner tax rebate and the 25c in the dollar income tax rate mean that pensioners with incomes of up to $106 a week will no longer pay tax under this Government. I think it is possible to calculate that together those two factors will mean that about 85,000 Australians will cease to be liable to pay income tax. That is a big step forward and obviously a step which is of great advantage to those Australians. The taxation reductions to which I have referred this morning, costing over $2, 000m in a full financial year, have been made possible, of course, by our rapidly growing economy. I simply refer again to the fact that in the period from June 1983 to June 1984 Australia experienced real economic growth of 10 per cent-the highest among all of the developed countries in the world and the best record in this country for 25 years. That is one of the key reasons why we have been able to finance these major tax cuts. There are now 60,000 fewer unemployed Australians than there were 12 months ago. That is one of the results of the rapid economic growth we have had in Australia. The end of the recession, with more Australians at work, fewer unemployed, the end of the drought and also importantly the introduction of the prescribed payments system for taxation have meant that revenues have been very strong and also importantly that a number of Australians who were not paying tax before and who should have been paying tax are now paying tax. This morning I heard Senator Peter Baume claim that this Government was a high tax government. I simply put on the record the figures for net pay as you earn tax collections in relation to Australia's gross domestic product. In 1982-83, the last financial year of the Fraser Government, Australian net pay as you earn tax collections were 11.5 per cent of Australia's gross domestic product. In this current financial year, 1984-85, net pay as you earn tax collections will be less than 11 per cent, in fact 10.9 per cent, of Australia's gross domestic product. So it is absolute nonsense for Senator Baume and others to claim that this Government is a high tax government. Clearly, if there has been a high tax government in Australia in recent times it was the Fraser Government, under which net pay as you earn tax collections amounted to 11.5 per cent of gross domestic product. I simply refer to a recent opinion survey published in the Melbourne Age which clearly shows that the Australians people know that the Hawke Government is not a high tax government. Senator Boswell —That is rubbish. Senator MAGUIRE —Senator Boswell should read that survey. Perhaps it has not been circulated north of the Queensland border. But let us look at some of the figures which show that the Australian people clearly believe that this Government is not a high tax government. Twenty two per cent of the population polled in that survey said that they felt they would be better off as a result of the Hawke Government's 1984 Budget. That figure should be contrasted with the 13 per cent of Australians who felt they would be better off following the Fraser Government's Budget in 1982 and a mere 2 per cent who felt they would be better off as a result of the Fraser Government's 1981 Budget. Let us look at the people who felt that they would be worse off as a result of recent Budgets. Nineteen per cent thought that they would be worse off as a result of the Budget this year compared with 60 per cent who thought that they would be worse off as a result of the 1982 Budget under the Fraser Government, and a staggering 73 per cent who believed that they would be worse off as a result of the Fraser Government's 1981 Budget. The Australian people believe they will benefit from this Budget. From those figures it is possible to draw a very strong inference that they can see that this is not a high tax Government. I turn briefly to the Medicare Levy Bill 1984 and refer to the changes which are proposed in this legislation. Under this legislation the exemption level for payment of the Medicare levy will be increased quite significantly. For instance a married couple will be exempt from the one per cent Medicare levy if their income is $11,803 or below. For every dependent child there will be a further exemption of $1,330. Therefore a two-child family whose income is below $14,463 will no longer be liable for the Medicare levy. This morning we have heard an absolute diatribe from Opposition speakers claiming that the Medicare levy will have to rise beyond one per cent to pay for the system. Here is proof that it will not. This legislation will free many Australians from paying the levy. With a one per cent levy we can afford to free many thousands of Australians from paying the Medicare levy. On 11 September I asked a question in this place of the Minister for Social Security (Senator Grimes) as Minister representing the Minister for Health (Dr Blewett). I asked him how many Australian families would no longer be liable for the one per cent Medicare levy as a result of this legislation. He said that on the best available calculations 120,000 Australians without dependants would no longer pay the levy and a further 35,000 Australians with dependants would no longer pay the levy. It is estimated that 155,000 Australians will not be liable for the one per cent Medicare levy as a result of this legislation. That represents a tremendous increase in disposable income for those Australians. It is possible to calculate that as a result of the various measures introduced by this Government-the tax cuts and the lower cost of medical care as a result of Medicare-the average Australian family is now about $21 a week better off in terms of real disposable income. That is as a result of the cost of health cover being reduced by Medicare, the $7.60 a week reduction in income tax and also, importantly, the 2 per cent reduction in housing interest rates from the 13 1/2 per cent level which applied under the Fraser Government in early 1983 to the 11 1/2 per cent level now applying in Australia. Those factors together have resulted in the average Australian family being $21 a week better off in terms of real disposable income. We would like to be able to make bigger reductions in income tax than are provided in this legislation. As I have said, $7.60 a week is a significant cut in income tax. We would certainly like to be able to do better but one of the problems that we face, of which I am sure you, Madam Acting Deputy President, are as well aware as other honourable senators, is the fact that on four occasions we have found it impossible to get through this place legislation to collect taxation from those who have participated in bottom of the harbour taxation avoidance schemes. On four occasions this Government has tried to extract that revenue by trying to pass legislation to crack down on those involved in tax avoidance or tax evasion through bottom of the harbour activities. On four occasions this Government has been defeated in this place in trying to get that legislation passed. Not only did senators from the National Party of Australia and the Liberal Party of Australia oppose that legislation but also Senator Harradine from Tasmania and three of the Australian Democrats senators. Senator Haines from my State of South Australia, Senator Chipp and Senator Macklin are the three Democrats who have not supported this Government in trying to extract more revenue from tax cheats. The gross amount of revenue that was lost as a result of the defeat of the first of those four Bills was $570m. That $570m in revenue was not extracted from tax cheats as a result of the defeat of the legislation proposed by the Labor Government. That represents $570m which cannot go into the Budget, which cannot provide for various expenditure schemes or for larger reductions in income tax. I call on Senator Haines in particular, who is from South Australia, to come clean on tax avoidance and help us get important legislation through the Parliament to crack down on tax cheats in Australia. If we could get that extra revenue we could certainly provide much larger taxation reductions for Australian taxpayers. With those remarks I commend the legislation to the Senate. Senator BOSWELL(Queensland)(11.41) —I welcome the opportunity to enter this debate, particularly on the Medicare Levy Bill. I wish to put Queensland's position on this Bill. Before I do that I want to take Senator Maguire to task as I believe he gave some misleading figures. I seek permission of the Senate to incorporate in Hansard a table prepared by the Parliamentary Library on the tax levels of pensioners. Leave granted. The table read as follows- 1982-83 TO 1984-85 Additional income weekly 0 5 10 15 20 25 30 35 40 45 50 Additional income per annum . . 260 520 780 1,040 1,300 1,560 1,820 2,080 2,340 2,600 1984-85 pension 4,771 4,771 4,771 4,771 4,771 4,771 4,771 4,641 4,511 4,381 4,251 Total income 4,771 5,031 5,291 5,551 5,811 6,071 6,331 6,461 6,591 6,721 6,851 Tax (1984-85) 47 116 186 255 324 394 463 498 532 567 602 Pensioner rebate 250 250 250 248 215 183 150 134 118 102 85 Net Tax Nil Nil Nil 7 109 211 313 364 414 465 517 *1983- 84 pension 4,445 4,445 4,445 4,445 4,445 4,445 4,445 4,315 4,185 4,055 3,925 Total income 4,445 4,705 4,965 5,225 5,485 5,745 6,005 6,135 6,265 6,395 6,525 Tax (1983-84) Nil 33 111 189 267 345 423 462 501 540 579 Pensioner rebate . . 250 250 250 243 210 178 162 146 129 113 Net Tax Nil Nil Nil Nil 24 135 245 300 355 411 466 *1982-83 pension 4,012 4,012 4,012 4,012 4,012 4,012 4,012 3,882 3, 752 3,622 3,492 Total income 4,012 4,272 4,532 4,792 5,052 5,312 5,572 5,702 5, 832 5,962 6,092 Tax (1982-83) Nil Nil 21 101 181 261 340 380 420 460 500 Pensioner rebate . . . . 167 167 161 129 96 80 64 48 31 Net Tax Nil Nil Nil Nil 20 132 244 300 356 412 469 * Actual Pension Income: Department of Social Security. Economics and Commerce Group 7 September 1984 Legislative Research Service Senator BOSWELL —I thank the Senate. As I have said, I wish to put Queensland's case on the Medicare debate. We have had misinformation in this place from the Minister for Social Security, Senator Grimes, aided and abetted by Senator Reynolds and Senator Colston, who I see is in here to interject. If Senator Colston has a position to put he should act like a man, and stand up and place it before the Senate as I am doing now. In answer to a question from Senator Reynolds, Senator Grimes said that the Queensland Government was not spending its Federal Medicare allocation on health in Queensland. That is a gross misrepresentation of the truth. Senator Grimes and the Labor Government should be very careful before making such accusations. I believe that Senator Grimes has not studied the Medicare position of Queensland. Much of what he has said in the Senate has been said on the run. I believe it is time that the facts are spelt out for his benefit and for the benefit of Senator Colston, Senator Reynolds and all other honourable senators in the Government. I will spell out the facts exactly. Queensland has been cheated-I use the word cheated-of $62m a year. That is the amount owing to the Queensland Government if it is to be paid at the same rate as every other State in Australia. I state that figure again for the benefit of Senator Colston: $62m is the amount that Queensland is owed, what Queensland should be paid if it is not to be discriminated against. Queensland receives $46.60 per person under the Medicare outlays, under Commonwealth Government grants. The other States receive $65 per person. That represents a shortfall of $20 per person in Queensland. That is the fraud that has been perpetuated by the Federal Government. It is defrauding Queensland taxpayers of $62m a year-$20 for every man, woman and child. The justification for this is that Queensland had a free hospital system at the time of the introduction of Medicare. The Government's justification is that because Queensland had a free hospital system it has always paid the medical costs. What an absolute fraud. Does Senator Colston not think, as he is sitting over there, that he should be standing up for Queensland? He should be saying that Queenslanders pay the same rate of tax as every other Australian. Senator Colston is sitting there and letting the people he represents be defrauded of $ 62m. He must not come here in the Senate and tell me I do not know what I am talking about. Senator Colston —You wouldn't have a clue, you old fool. Senator BOSWELL —I think that remark should be withdrawn. Senator Colston —I am quite happy to withdraw the word 'old'. The ACTING DEPUTY PRESIDENT(Senator Coleman) —Order! Senator Colston, there has been an objection to the remark that Senator Boswell is an old fool, and I must request that you withdraw it. Senator Colston —I am quite happy to withdraw, Madam Chair. Senator BOSWELL —Thank you. As I was saying, every Queenslander pays the same amount of tax as every other person in Australia and should receive the same benefits. On 10 September, in answer to a question, the Minister for Social Security, Senator Grimes, said that Queensland had done well out of Medicare. He said that the Queensland Government had misused $20m of Queensland's funds. If Senator Grimes was in the Senate at the moment I would call for a withdrawal of that statement too. The Courier-Mail contained a Press release entitled: ' Medicare cash spent properly in Queensland'. The Courier-Mail is the premier independent newspaper of Queensland. It said: 'We are not spending the money unwisely or wrongly'. Queensland received an allocation from the Federal Government of $79m plus a $35m special grant. That is a total of $114m. The $35m that was allocated to Queensland in the Federal Budget on 22 August was promised at the July 1983 Premiers Conference when the big hearted Federal Government gave us $15 a head and everyone else $50 a head. The Premier had to go in there and fight tooth and nail for the people of his State. Senator Colston could take a page out of his book and fight for the people who put him down here instead of trying to rob them. The Premier fought for a $35m special grant and got it. Now the Medicare subsidy has moved up to $46.60 per head compared with the other States. The Australian people are receiving $65 a head but Queenslanders are still $20 behind the eight ball. After the Federal Budget on 22 August Queensland's share of the Medicare funds, including the $35m grant, came to $114m. I want to tell honourable senators exactly what the position is at the moment in Queensland. The facts are that last year Queensland spent $743m through the Hospital Administration Trust Fund on health services for the people of Queensland. Last year $720m was allocated for these services in the Budget. Of the $23m, $15m came from the special grant and the remaining shortfall was made up by the Queensland Government. Senator Grimes told us in the Senate that a special subsidy was given to Queensland to make up Queensland's pre-existing free health service. The Queensland Government had to fight to get that subsidy up to $50m, which is paid in monthly instalments over 17 months, or $35m this financial year. That is still not proper compensation as it should be much more. It should place Queensland on an appropriate equal footing with the other States. The Queensland Government has spent every cent of that grant on its health services and, what is more, it will always be able to account for every cent that it has spent on its health Budget. Why has the Australian Labor Party spread this story? The reason is so that it can hide the fact that the people of Queensland are being short changed to the tune of $62m a year. That is why this misrepresentation is being spread around the Senate. Thankfully it is not going any further than here because the people of Queensland realise exactly what this Government is doing to them. In essence it is taking one per cent of their wages, which it promised to do, but it is also taking one per cent of investments on people's savings for a service that every Queenslander previously got for nothing. I reiterate that the whole of Queensland is not only being discriminated against because the people are not being subsidised $65 a head under the Budget but also the people are paying for a service that is costing them one per cent, which they got for nothing for 30 or 40 years. I ask honourable senators: What do they think the people of Queensland think about that? Of course they are upset and honourable senators should understand exactly why. The Medicare monster is now out of financial control. It is running rampant. No one on the Government side can control it. No one knows what is going to happen to it. Medicare ran $109m over the Budget last year. The 1983-84 Budget deficit for the Medicare scheme was $134m. In 1983 Dr Blewett said that the Department of Health estimated a $25m deficit. No one has been able accurately to pinpoint the cost of Medicare. We have become used to revision upon revision of the actual cost of the scheme. For example the Treasurer (Mr Keating) said that the net effect of the introduction of Medicare on the 1983-84 Budget would be $35m from February 1984 and $80m in the full financial year. However, two days later the Minister recalculated his figures saying that the deficit would be $25m for that period and, for the full financial year of 1984-85, it would be $62m. Government senators will have to admit that they do not know where Medicare is taking them. It is a monster that is out of control and someone ought to do something about it very quickly because 9 out of 10 Australians are not receiving the benefit, as the Prime Minister (Mr Hawke) said they would. I believe that probably six or seven out of 10 Australians-as Senator Walters pointed out-have been hurt by Medicare. Even Dr Blewett, who prescribes what we should be doing, makes rules for the whole of Australia but cannot abide by those rules when it comes to his own family. What can be expected if the Minister cannot even stand up for a Bill he has brought in? No wonder everyone in Australia has lost complete faith in he Medicare system. What is Medicare? It is only another Labor control on doctors' incomes, which we have seen time and again since this Government came to office. Mr Willis has now brought down another system to control engineers' wages. It will not be long before accountants' wages are controlled. The Government says: 'We will do it through the prices and incomes accord, through the Economic Planning Advisory Council and through the National Economic Summit Conference'. What a giant fraud we are facing. All the Government wants to do is control incomes, and it is doing that successfully. Senator Childs —Thanks. Senator BOSWELL —Is the honourable senator acknowledging that the Government wants everyone on one level? Senator Childs —We want to control incomes so that unemployment will be soaked up. Senator BOSWELL —The Government will not soak unemployment up if it keeps adding on costs, such as redundancy and superannuation payments to the running of a business; but that is another area that we will come to later. I am very glad to be able to put Queensland's position on the record- Senator Colston —The Queensland National Party position. Senator BOSWELL —I stand up for Queensland; Senator Colston knocks it. He never says one decent thing about it. Queensland has openly disclosed its honest accounting of the Medicare funding and Queenslanders look forward to the Federal Government treating them equally with their fellow Australians and stopping the present rip-off of Queenslanders in unfair Medicare funding. Senator JACK EVANS(Western Australia)(11.56) —This is a series of Bills aimed at carrying through a number of measures, including new tax scales, that the Government gave notice of on Budget night. There has been one fairly radical move taken in the legislation before us-the introduction of five-step tax scales . That is an improvement. It certainly alleviates the tax burden on a number of people. However, it does not provide the alleviation that was sought and is desperately needed by people at the lower end of the tax scale, as would the raising of the threshold. I speak on behalf of the Australian Democrats in indicating that we feel that the Government muffed this particular shot because by raising the threshold it really would have benefited something like three million of our citizens who are living on the poverty line or below it. We have a desperate plight to contend with, and this Government has missed this opportunity with this Budget to meet the problems of at least some people-the low level wage earner group. Instead, this Government, like all governments when they are coming up to an election, has once more directed the benefits of the Budget to those in the middle income level because that is where it perceives the swinging voters to be . Middle income earners will benefit, as will upper income earners because they also get some benefit from these new tax scales. They will benefit at the expense of those on lower incomes. That is a very unfortunate thing for a Labor Government to have carried out-a revision of tax scales which gives benefits to those at the top and those in the middle but does not give all the benefits which it had available in this Budget to the people at the very bottom of the scale. I would have thought also that this Government, with this Budget, would change its emphasis. It has indicated for some time that it has recognised the need for reducing its revenue derived from personal income taxes. We have had speech after speech, particularly out on the hustings and particularly prior to the last election, from members of the Australian Labor Party who have indicated that the Government is changing its emphasis and is planning to change the tax system. One would have hoped that during the life of this Parliament we would have had that change implemented. The change would have brought about some increases in indirect taxes, particularly consumption taxes for luxury items and items that are not categorised as necessities of life. At the same time, the increased revenue from that area could be directed towards the reduction of personal income taxes. That would have had a very dramatic effect on the whole economy because it would have given small businesses particularly the opportunity to pay lower increases while their employees received the same take home pay as a result of reduced income tax levels. That would have flowed on right through the system and would have increased productivity throughout Australia as a result of reducing costs of production. Those are simple measures that could have come about as a result of this Budget. Instead, as I said, the Government has muffed it. It has thrown the issue to a few committees and other people to think about it and, who knows, in the next parliament or the parliament after that we may have a revised tax system. One thing we can be certain about is that in the next Budget we will have some new tax rates. The Government will not sit pat on this new set of tax scales. That means that the benefits that flow from these new tax scales will probably not even run for a full year. The scales will probably be amended in the next Budget, and nobody can be sure when that will be; it may be next August, but most pundits have indicated that the next Budget will be a mini-Budget round about March next year. Whenever it comes about, it will ensure that these new tax scales do not run for a full year. So anybody who is under the false impression that he or she will benefit from at least one year of earnings at the new tax rates will be disillusioned. People will be particularly disillusioned when they assess their tax for the year ending 30 June 1985 because that will be a pro rata tax rate, partly based on the old tax rates and partly based on the new ones. Therefore, the benefits they thought might be applicable to the whole of this financial year will certainly not be so applied. I put in a fervent plea to the Government as it runs into the next election to make a promise which we, the Australian Democrats, will help it to keep. I plead with this Government to promise that we will have a radically changed tax system . Part of that radical change, I beg the Government, should be the changing of our tax laws, to simplify them. Later this week we will be debating a series of amendments to our tax laws which are so complex that Australia's leading tax lawyers and tax accountants are having great difficulty coming to grips with them. Those are just the amendments, never mind the existing legislation which everyone is supposed to know because there is no acceptable plea of ignorance of the law. As I have said previously to this Parliament, there is not a person living in Australia at this moment who fully understands the tax laws of this country. There is not one undisputed point of view on the tax laws of this country. Yet everyone of us, every taxpayer in Australia, is expected to know, to understand and to be able to conform with tax legislation which this Parliament has passed over the years and continues to pass amendments to year after year. We need a better tax legislation program and concomitant with that we need a much improved tax plan overall. I believe that the only way we can achieve that is to get all the political parties in this country to agree to a long term tax plan. We must all put aside the party rhetoric, the political rhetoric, and agree to what will benefit all Australians in the next decade, the next 20 or 30 years in terms of a long term tax plan. This is possible; it is done in other countries and it can be done here. It is probably easier to do it in Australia because of the existence of the Australian Democrats, who are a binding force and who tend to pull the parties together and even allow the extremists in the other parties to have their say but not to dominate those parties so that we can achieve consensus. That is possible provided the Government which comes through the next election as the government of 1985 and for the following couple of years, is willing to seek consensus with the other political parties in the tax system and in the tax laws. This consensus would lead to a stable tax system, that not only pay as you earn taxpayers but business taxpayers, those who have to plan a long way ahead, can accept as a basis for the next decade or so. I was very disappointed to hear a scathing attack by a member of the Government on the Australian Democrats over our attitude to bottom of the harbour legislation. I am the first to acknowledge that the loss of that legislation had an impact on the Bills before us and therefore is relevant. I am the first to acknowledge that that legislation was contested around Australia, with very strong arguments for it and equally strong arguments against it. The principle of retrospectivity, a vital principle in the view of some, was upheld by those people as an absolute principle in tax legislation. Those who have maintained that anti-retrospective stance right the way through, whether in relation to the bottom of the harbour legislation introduced by the Fraser Government or similar legislation introduced by the Hawke Government, and to be admired and not admonished, because they have fought against a principle which, if left unleashed in this Parliament, could result in draconian measures being implemented against pay as you earn taxpayers or against any taxpayer in this country at any time in the future, particularly if the government of the day controlled this Senate and was able to plough unimpeded through this Parliament and inject into Australia's taxation system any measures on a retrospective basis. We have a number of measures coming before the Parliament later this week which could, if applied retrospectively-and such a provision could be sought by the government of the day-have people around this country imprisoned because of misdemeanours, errors of judgment or other simple errors they have made. That could have been the case now if this Senate was controlled by the government of the day and it decided that it had carte blanche to apply retrospective tax laws to any tax legislation coming through this Parliament. Not all the Australian Democrats agreed with that point of view. It is interesting that, just as half the people of Australia agreed that the retrospective principle should remain inviolate, the other half agreed with me and another Australian Democrat, Senator Colin Mason, that legislation covering the collection of taxes avoided through dubious means, including illegal means, should be passed. I make it very clear that I voted for the Hawke Government's retrospective tax legislation. I say that unashamedly because I believe that, despite its retrospective application, as long as I am a member of this Parliament there will be a very clear distinction between that kind of legislation and any other form of retrospective tax legislation. I believe that the Democrats will remain in this Parliament as a balance of power to ensure that retrospective provisions of any sort are very rigidly controlled by the Senate. So I have no apology to offer to this Government. I have supported all of its bottom of the harbour legislation, subject only to amendments that I have put to the Treasurer (Mr Keating) and which he was willing to accept. Given that there has been an interference by the Senate with the Government's tax program and therefore that these Bills have been influenced by the rejection of the bottom of the harbour legislation, one would have expected this Government, as a fighter of people who avoid paying their taxes, to embrace warmly legislation which has been passed through this Senate to claim taxes from the so called cherry-pickers, operating under the section 23F provisions of the Income Tax Assessment Act, and rapidly to pass that legislation through the House of Representatives. Mr Acting President, I know your opinion of this Senate and the role that it has to play in this Parliament. You hold it in very high esteem, as I do. I know that members of the Senate will share my dismay that the Income Tax Assessment Amendment Bill 1984 (No. 2), passed by this chamber on 4 May this year, is sitting in the House of Representatives waiting for the Government to pick it up and pass it through that House. It is a Bill which attacks the cherry-pickers who are operating at this moment unimpeded because the Government has not passed that legislation. Let me make it quite clear: The Government has no problem with the principles of the Bill, because the Bill is identical to the Government's own legislation on cherry-pickers. Let me explain this cherry-pickers legislation. It concerns those people who have deliberately distorted the provisions given to genuine superannuitants and companies which introduced superannuation schemes for their employees. The cherry-pickers are those who have used that legislation to avoid any payment at all of tax on the funds which were channelled into a mock superannuation scheme, a superannuation scheme which was set up by these people with a deliberate intention of avoiding, through the tax loophole that existed, the payment of any tax. The Government drew it to the attention of the Senate and the Senate, I believe quite correctly, referred the retrospective aspect of that legislation to its Standing Committee on Finance and Government Operations. Its report to the Senate contained three recommendations. The recommendation the Senate adopted was that the Commissioner of Taxation be given 12 months to endeavour to claim the tax avoided under the cherry-pickers scheme through the provisions already existing in tax legislation. The Senate believed that the provisions were adequate without introducing retrospective legislation to reclaim that lost tax, and that belief was demonstrated in our reference back to the Taxation Commissioner for him to apply alternative measures to pick up the tax which he claimed has been lost. We went beyond that and adopted almost identical legislation. It had only one clause omitted, and that was the retrospective clause, the clause which backdated the Bill. We did that quite deliberately because we believed that the Government needed as quickly as possible a new Bill which protected this country from the cherry-pickers who exist today and who are still using the cherry- pickers scheme to avoid their tax obligations. So I find it incredible that a government which hits out at the people in this Senate who have on principle objected to its retrospective legislation and which claims that this objection has cost it revenue ignores the opportunity which the Senate handed to it on a plate. A piece of legislation has gone through the Senate and through all of the problems with tax Bills that are associated with the Senate and the changing balance of power. It was handed to the Government on a plate and the Government left it lying idle in the House of Representatives. The Government could pass the legislation today if it wanted to do so. One has to ask oneself the question : Is this Government dinkum? I put it to you, Mr Deputy President, that this Government has proven that it lacks credibility when it comes to collecting taxes that have been avoided in the past. The evidence is about to be produced for us. I throw down the gauntlet to the Prime Minister (Mr Hawke) and the Government which is in office at the moment. If the Prime Minister is genuine about the Government's concern, which was expressed through Senator Maguire today, that the Senate has rejected the retrospective bottom of the harbour legislation then he has a remedy. Senator Robert Ray —What's that? Senator JACK EVANS —He can call a double dissolution tomorrow. The Prime Minister has it within his power right at this moment to call a double dissolution. He knows, as we all know, that his Government will be re-elected. He knows also that the balance of power in this chamber will not be enough to win a joint sitting on the subject of the double dissolution which would be the bottom of the harbour legislation. He knows that that is within his power at the moment. If he is dinkum let him call a double dissolution. I put it to the government of the day that it is not genuine. It is not willing to call a double dissolution because all it wants, when it goes into the election, is a whipping boy. It wants three of the Australian Democrats, some members of the Liberal Party and Senator Harradine to be the subject of attack as they were in this simple bit of legislation based on the bottom of the harbour legislation. The Government is not dinkum. Honourable senators heard the reaction from a couple of honourable senators in this chamber-two of the three honourable senators on the Government side who are sitting in the chamber at the moment-to the proposition. That is an involuntary response which we could expect from them . I will await, as I know the people of Australia will await, the response by the Prime Minister. If he is genuine he will announce a double dissolution and not a half Senate election. That way he can retrieve what he claims is the lost $550m. If he is not dinkum we will have a half Senate election. He knows that the effect of that will be that whilst he will win government the balance of power will be maintained by the Australian Democrats in the Senate and the Australian Democrats will hold firm to our principles. I have already enunciated those principles. The Australian Democrats will pass this package of tax Bills unamended. We have no complaint. We believe the Government has conducted itself, as far as it has gone, in terms of the mandate for this legislation given to it by the people of Australia. I would applaud some measures contained in the legislation, including the fact that the exemption for bank accounts debits tax has been allowed to include educational, religious and benevolent institutions, which was the very provision I requested at the time of the last Budget. I thank the Government for including those items as exempt items under that tax provision. Regarding the other Bills, whilst we would have preferred to have been redirected towards indirect taxes, we accept that at this stage the Government is not willing to go down that path and that it has no alternative but to introduce these Bills. We applaud the five-step tax scale provisions and believe they will provide for a fairer tax system in Australia than previously existed. Senator COLLARD(Queensland)(12.20) —We are discussing a package of six tax Bills which are part of the Government's Budget strategy. The Budget is a series of documents brought down once every year. The documents really are an indication of the Government's financial blueprint for the ensuing financial year. In latter years Budgets have become more and more a media event. We have the buildup to the Budget, the rumours and the predictions, then we have the Budget Speech and its prognosis by the instant experts as they hurry to catch the next day's headlines. This year the Government quite skilfully used the fact that the Budget can be a media event. Indeed I think it was the first time since Federation, or since the invention of television, that we have seen the Budget Speech as a television event when it was broadcast live from the other place. It is very easy to be critical of those who have to be the instant experts, but we have to realise that they go into the lockup room late in the afternoon on the day the Budget Speech is to be delivered and they have deadlines to meet. In reality it is pretty hard to criticise them. As well as the Budget Speech there are at least 11 volumes to go through, so at best the immediate reactions are only from a cursory glance as they seek to make those deadlines. So on the night of the Budget we have the electronic media and their prognosis and the next day we have the headlines in the print media. Of course, that is the one avenue by which most people out in the streets receive the reaction to the Budget. When a Budget and a Budget Speech are designed around that fact there is a certain degree of success. That is what happened with the recent Budget. I have never seen a Budget Speech that said so little. It received the predictable electronic media reactions. There were the predicable headlines in the print media the next day such as '$7.60 tax cuts'. As a media event it was quite successful. I acknowledge that. We must acknowledge it. Senator Maguire alluded to the opinion polls. The polls have indicated that the people were taken in by this media event. They have not had a chance to see through the facade to where the sting really is in this Budget. I do not think I have ever denied that Labor governments are big spending governments. When the Australian Labor Party came into government, government spending was 29.9 per cent of gross domestic product. In this 1984-85 Budget it has already gone up to 31.1 per cent of GDP. I have had a table prepared which shows the real increase in Budget outlays from the Whitlam years through to the Hawke years. I seek leave to have that table incorporated in Hansard. I showed it to the Attorney- General (Senator Gareth Evans) when he was present in the chamber. Leave granted. The table read as follows- COMMONWEALTH OUTLAYS *Real increase in Budget Government Year outlays (%) Whitlam 1973-74 5.6 1974-75 19.8 Average (3 Budgets) 10 per cent p.a. 1975-76 5.1 Fraser 1976-77 -0.8 1977-78 2.4 1978-79 1.7 1979-80 -0.5 Average (7 Budgets) 2.1 per cent p.a. 1980-81 4.0 1981-82 1.9 1982-83 6.3 Hawke 1983-84 8.2 1984-85 (est.) 5.0 Average (2 Budgets) 6.5 per cent p.a. * Allowing for the inflation factor. Senator COLLARD —The table brings out my point of Labor governments being big spending governments. For the three Whitlam Budgets the real increase in Budget outlays was 10 per cent per annum. For the seven Budgets of the Fraser-Anthony years the real increase was 2.1 per cent per annum. We have had two Budgets from the Hawke Government and their increase in real terms is 6.5 per cent per annum. Those figures are shown in the table which I have just incorporated. Labor governments are naturally big spending governments. When there is a financial problem, it can, but does not necessarily mean that a big spending government can get out of the trouble. It depends on how that money is spent. Unfortunately , it is being spent by beefing up the public sector, and this is not a recipe for retrieving the situation in which the Government finds itself. I think everybody realises that as the private sector starts to make profits it will start to employ people in real jobs, not in funny jobs such as those being created now, such as the increase in jobs in the Public Service at both the Commonwealth and State level, particularly I understand in New South Wales and Victoria. So this is one of the problems with increasing government spending if the money is not being spent well. It must also be understood that where wages are applied without relevance to market forces they will eat up an inordinate amount of increases in government spending and they will not have any real effect on the unemployment situation. Senator Peter Baume mentioned Medicare, and quite rightly. The enormous cost that Medicare is imposing on our Budget is something that we cannot afford and something that no country which has ever gone down the track of developing a similar health scheme has been able to afford, but it is there. It is quite interesting to look at the figures. I have had another table prepared which I would like to have incorporated in Hansard. I spoke to Senator Gareth Evans about it when he was at the table. I seek leave to have it incorporated, Mr Deputy President. Leave granted. The table read as follows- BUDGET OUTLAYS ON HEALTH Nominal percentage change from previous Government Year $m year Whitlam 1973-74 947 + 7.7 1974-75 1 283 + 35.6 (Medibank) 1975-76 2 953 +130.1 Fraser/Anthony 1976-77 2 543 - 13.9 1977-78 2 698 + 6.1 1978-79 2 901 + 7.5 1979-80 3 169 + 9.2 1980-81 3 645 + 15.0 1981-82 2 912 - 20.1 1982-83 3 425 + 17.6 Hawke (Medicare) 1983-84 4 411 + 28.8 1984-85 6 184 (est.) + 40.2 Senator COLLARD —This table shows Budget outlays on health and their nominal change from the previous years. It is quite interesting that in 1975-76, which was the year Medibank was really introduced into this country, we had an increase from $1.283 billion in 1974-75 to $2.953 billion in the one-line health item in the Commonwealth Budget. That is an increase in nominal terms of 130 per cent. Since Medicare has been introduced we have seen an increase in nominal terms of 28.8 per cent in the 1983-84 Budget and in the 1984-85 Budget there is an estimated increase of 40.2 per cent. In money terms there is an increase from $4.4 billion to $6.1 billion. I suggest that this country cannot afford that sort of increase. As Senator Baume has pointed out, everybody thinks that the one per cent levy covers the increase in health costs, when in actual fact it does not. This enormous increase is being topped up out of Consolidated Revenue. When my friend and colleague Dr Glen Sheil was in the Senate-he will be back here very shortly-he used to have a saying that when something is free at the point of demand consumption rises astronomically. That is shown to be very true when we look not only at the increase in health costs with the introduction of Medibank and Medicare but also at the figures which have been issued on the usage of those schemes. The recuperative powers of the human body seem to degenerate quite markedly when people think there is a 'free' health scheme, not realising that somewhere somebody is paying. Australia, which was a fairly healthy nation when Medibank was introduced, became quite a sickly nation. I am quite sure that is happening under Medicare. I do not like bulk billing. It is not that I am against helping the lower socio -economic groups or those people who are not able to afford good health care-by right any government should look after those whose means are such that they cannot provide themselves with adequate health care-but the minute we go down the track of bulk billing people become unaware of the actual cost to somebody else, in this case the taxpayer. That is one thing that I dislike intensely about the bulk billing syndrome. People are not aware of the cost of the system. There should be a means by which they are made aware of the cost and are then helped to pay it. A big spending government is of necessity a high taxing government, and that is the situation with the Labor governments. We cannot look at the 1984-85 Budget in isolation. We have to look at the May mini-Budget of last year and at the 1983-84 Budget to get a total idea of how this Government is increasing its tax take. We have heard all about the tax concessions that will be granted on 1 November, yet the income tax collection this year will show an increase of 23 per cent, an increase of $5.6 billion, over that of last year. We have lost concessions such as the rebate for contributions to, for example, the Medical Benefits Fund of Australia Ltd and, the housing loan interest refund. As I said, we have to look at previous Budgets to see that built into the Labor Party Budget philosophy as well as its socialistic philosophy is the concept of increasing the income tax take year by year without its necessarily showing up, except in the raw figures at the end of the day. The average taxpayer is already worse off by $22 a week because of a loss of these concessions and all of the other Budget philosophies that have been brought down by this Labor Government. Yet this Government touts around the fact that on 1 November there will be tax reductions of an average of $7.60 per week. It is not a case of Peter being robbed to pay Paul; Paul has already been robbed to pay Paul. We now have the introduction of a five-tiered tax scale. That means that with any slight wage increase over the next 12 months that $7.60 will basically be lost. Having already paid for it people will lose it very quickly. Another point about that five-tiered tax scale is that the $19,501 point at which the 46c in the dollar rate becomes operative has not been indexed. Another thing that people should know about this five-tiered scheme is that when a person earns $28 ,001 a new rate of 48c in the dollar becomes operative. So one need receive only a slight increase in wages and the $7.60 which has already been paid for is lost . The fuel excise has been indexed, but it does not show up in the Budget. It does not show up as a new tax, yet it is there. The people should understand that a part of the fuel excise has been applied to the Australian Bicentennial Road Development Trust Fund, which we brought in to provide funding to bring all national highways up to at least an acceptable standard by 1988 and also to provide funds for urban transport. This Labor Government has indexed that excise and the additional money raised is going into Consolidated Revenue, not into the ABRD Trust Fund. So the extra excise that motorists are paying, that should be going towards bringing the roads of this nation up to an acceptable standard, is going into Consolidated Revenue and not to where the original legislation intended it to go. In the last Budget we have seen an increase in aviation fuel excise. This Labor Government seems to think that aviation is still a tool of the rich instead of being part of the development of this nation. With our vast distances we probably need aviation more than most other nations. Australia has contributed much to world aviation in opening up long distance international air routes, in opening up this country and in the design of aircraft since Bernoulli developed his theory that enabled an aerofoil to operate in the way it does. Australia has made a tremendous contribution, yet the Labor Government still seems to think that aviation is an area that we can tax to blazes, that it is a tool of the rich man. Not only has it played a very vital part in opening up this country; it still plays a very vital part in the areas of communications and transport within this country. This Government is by nature a big spending government. To fuel that big spending it is also a high taxing government. It is not coming to grips with the real problem. We are not addressing the problems of the high cost structure in this country. We are continually losing our international trade competitiveness and we survive only because we are a trading nation. The Government has not addressed the problem of youth unemployment. It is unfortunate that in the last few years wages for young people in this country have risen to a point where they are almost, if not completely, that for adults. Thus vast numbers of young people are on the unemployment files. This is a tragedy. They are growing up believing that they will never get a job. A graph could be drawn showing the relation between the increase in youth wages and the increase in the number of young people on the unemployment files. This Government is not addressing the problem. It hides behind the prices and incomes accord. That still does not come to grips with the problem that our wages are not set in a market atmosphere. They do not bear any relation to the cost of production or the productivity of the workers. We cannot continue to go down that track and expect Utopia to be just around the corner. If this Government does not address the problems it faces, they will be the Hawke Government's Achilles' heel. It cannot keep talking up the economy and hiding behind the breaking of a drought and the previous Government's wage freeze. If the Government does not address the problems that are facing us we will be in for a severe time in the ensuing years. It is no wonder this Government wants to head down the track of an early election. It is a big spending government; as a result, it is a high tax government. Ultimately, it will bear that cost. Senator WALSH(Western Australia-Minister for Resources and Energy)(12.37) —I will comment briefly upon two or three matters of substance which have been raised in the course of the debate. First, Senator Jack Evans and some earlier speakers put forward the argument that the taxation cuts announced in the Budget and now being legislated for here should have been made by way of increasing the tax free threshold of income instead of reducing the rate of tax which is the course the Government has chosen. Superficially that is an attractive argument because it would seem that people who have low taxable incomes are people in need. That, however, is not necessarily the case. We know with certainty that not all people who have low taxable incomes are people in need. That is so for a variety of reasons. The income may be a second income or a part time income in a household. It may be that of a person who has entered the work force only midway through the taxation year and therefore has a low income for the whole year. One could delve into a number of other possibilities. We know for certain that not all people with low taxable incomes are people in need. Therefore, we know that the belief that they are in need is not correct. What we do not know is the degree to which that belief is not correct. Senator Evans made a valid point when he suggested that there ought to be a review of the whole taxation system. I suggest that review should be integrated with the social security system. A case could then be made out for that review. Before rational decisions can be made on such a review or on an alternative policy it would be highly desirable to have a good deal more reliable knowledge and information than we now have. Other arguments against the suggestion that the threshold of tax free income should have been increased instead of most of the rates in the income spectrum being reduced is that any increase in the threshold of tax free income, other things being equal, provides exactly the same quantitative benefit to all taxpayers regardless of their level of income. To be precise, that would disregard that small range of incomes between the previous tax free threshold and the one which has now been set. The Government regarded that as inequitable. It would have been possible at much the same cost to attain a reduction of the order of $4 to $5 in tax payable by virtually all income tax payers simply by increasing the threshold. It would not in the Government's view have been equitable to have approached the matter in that way. The policy adopted by the Government was to maximise, within the overall constraint of the amount of income which it was judged could be forgone, the benefits of the tax cuts in the range of incomes between $12,500 and $28,000, that being judged to be the range of incomes through which people were in full time employment and most likely to be dependent on the incomes they earned for their support. They may or may not have had other dependants. That was an equity consideration. Like all judgments based on equity, it is liable to some valid, but more often invalid, criticism. The tax cut throughout the range of incomes between $12,500 and $28,000 is $7.60 a week. The absolute amount reduces at either below $12,500 or above $28,000. That again was the intention of the Government at the lower end of the income range for those below $12,500 for reasons I have stated earlier, and at the upper income range on the ground that people with taxable incomes above $28,000 are clearly not in need of tax cuts of the magnitude provided throughout the lower and middle income range. That was an equity decision. The Government's decision was also closely related to the need to cement the prices and incomes accord and the representations that were being made by the Australian Council of Trade Unions to have substantial reductions in income tax throughout the range of incomes covering people in full time employment as, if you like, a trade-off for not attempting to recover through the wage indexation system the effect on the consumer price index of the Medicare levy. I make no apology for that policy in either a personal sense or as a representative of the Government. As a result of that policy the accord has now been cemented and there is a guarantee that there will be no increase in award wages between April 1984 and April 1985. Because of that it follows inexorably that the rate of inflation which has already been brought down by some 40 per cent since this Government came into office will continue to fall and that the significant but moderate reduction in interest rates which has so far taken place will continue, other things being equal, sooner or later commensurate with the fall in inflation rates. Because of the interaction between the level of the tax cuts and the target area, the area of incomes in which they were targeted, and the cementing of the accord, we can now be confident that inflation will continue to fall. this will assist in a vital way the continuation of the sorts of rates of economic growth which are required to restore full employment. I submit that ultimately the restoration of full employment provides the best chance of relieving poverty whether it be the poverty of the unemployed or the need of other social security recipients. The restoration of full employment brings a consequent increase in the national product. Therefore, the amount which is available for redistribution is increased and in that way those people's needs can most effectively be met. Sitting suspended from 12.45 to 2 p.m. Senator MacGIBBON —I address my question to the Attorney-General. Is the National Crime Authority investigating in any way the material passed to it by the Costigan Royal Commission on the Activities of the Federated Ship Painters and Dockers Union or is that material still in the process of being sifted through by Mr Phillip Cummins and his team of part time helpers? Senator GARETH EVANS —As I have said on numerous occasions, the National Crime Authority has two levels of functioning. One is the conduct of investigations not involving hearings or the use of other forms of coercive power. The second is investigations pursuant to references formally vested in it by the Commonwealth Government or through the intergovernmental committee which do imply the use of coercive powers. It is not the case at the moment that any references have been given to the Crime Authority. So in that sense there are no investigations currently proceeding pursuant to those particular powers. There are, however, a number of forms of investigation proceeding in relation to the Costigan material. That investigation essentially is taking the form of sifting and processing the Costigan information in order to determine priorities and to determine what is appropriate to pursue further by the use of formal references or by other means. There are other investigations proceeding which involve the weighing and sifting of other evidence relating to other matters that have been provided by the Australian Federal Police and other law enforcement agencies around the country. It is early days yet. We are still in a transitional process. The Crime Authority is not, as I have said, fully staffed yet and will not be until the Costigan Commission completes its report writing. But that process of transition and developing the investigative role is proceeding apace and proceeding very satisfactorily. Senator ZAKHAROV —Is the Minister for Education and Youth Affairs aware that a delegation of students from various tertiary campuses has travelled to Canberra today in order to protest at the Government's decision to phase out the subsidy to student residential colleges? Can the Minister give some further explanation of the Government's reason for phasing out the subsidy to the colleges? Senator RYAN —I am aware that there are students from residential colleges in Canberra today and I am hoping to find time to meet some of them or some of their representatives this afternoon. When I do I will explain again to them, as I have explained to students from residential colleges throughout Australia and their administrators, what the change in the form of assistance to student accommodation means. The most important thing to say about it-and this does not seem to be well understood by some students and some administrators-is that disadvantaged students living away from home to study will benefit from the changed way of allocating the subsidy. Those students who have to live away from home, who come from remote areas, who are living in residential colleges or in any other form of accommodation that they can find for themselves will benefit from the new arrangements. I remind honourable senators that of students in higher education institutions living in residential colleges, 71 per cent must live away from home, 11 per cent are overseas students and 40 per cent receive tertiary education assistance scheme benefits. There are 87 residences at universities but only 20 residences at colleges of advanced education. So it is quite clear that there is a variety of circumstances in which students who must live away from home to study have to live. Some live in student residences. Some of them cannot live in student residences because in the case of many of the CAE, there are no student residences to live in. So when our Government wanted to look at a better way of assisting students who need to live away from home, we could not support the maintenance of a system which assisted only those students in those institutions that had residential colleges and who were in those residential colleges. Under the previous scheme only 6 per cent of tertiary students received any accommodation assistance at all and that assistance was not given on a needs basis. It was simply a per capita subsidy to the residential college of something in excess of $9 per week per student. That subsidy will be phased out over the triennium but about $10m will be available to all CAEs and colleges by way of an emergency fund which the institutions themselves will administer according to guidelines we are currently working out with them which will require them to give priority to accommodation assistance to students from needy backgrounds who come from country areas. In that way we believe that many more such students will receive assistance than under the present scheme. It is very important to point out also that needier students living in halls of residence-they are the students whose cases we are sympathetic to-have already benefited in terms of the Budget because the TEAS living away from home allowance has been increased by more than $6 a week. The phase out of the subsidy will not require any increase in fees of more than between $3 and $4 a week. So the truly needy students, those on full TEAS, will receive in their TEAS increase more than enough to pay for any increases in college fees caused by the phase out. So their needs are being more than adequately met. What is of great importance to our Government and, I believe, to people who understand the circumstances of students is that under the new arrangement that $10m fund will be available to all students on a needs basis who have to live away from home. I hope that that explanation will clarify finally what the changing policy will mean, how it will be of greater benefit to students from disadvantaged backgrounds and how it will be able to be administered in a way that should not disadvantage any students. Senator COLLARD —My question to the Attorney-General concerns the totally unsatisfactory transition process between the Costigan Royal Commission into the Activities of the Federated Ship Painters and Dockers Union and the National Crime Authority, about which Mr Costigan has expressed much concern. If the Government's original plan was to have had the Authority up and running much earlier this year so that there would have been time for a transition similar to that envisaged by the Fraser Government, why did the Government not respond more flexibly when, because of delays imposed by disputes in Caucus and the need for a Senate committee investigation to strengthen the original legislation, the Authority could not be set up until the beginning of July? Why, in those circumstances, did not the Government agree to extend the Costigan Commission to the end of the year so that there would have been time for full briefings in a genuine transition period rather than the farcical two weeks which was available before Mr Costigan and his team had to concentrate on writing the final report? Senator GARETH EVANS —The Government has responded extremely flexibly and extremely sensitively to the requests that have been made for the extension of the duration of the Costigan Commission. We have been concerned throughout the whole life of this matter since we came into government with implementing arrangements which would both result in a transition from the Costigan Commission to a new crime authority armed with the powers and the capacity to continue the work that the Costigan Commission was doing and to ensure that that particular transition took place smoothly and effectively. It was always acknowledged by us that there would be certain loose ends remaining to be picked up and taken over by the National Crime Authority when it was in fact put into place. It is not surprising that any particular transition period occurring at any particular time would demonstrate the existence of those loose ends. In this respect, I think it is about time that there was put on the record the views of the Fraser Government about just this question of the transition process and the inevitability of there being loose ends of one kind or another which would have to be picked up by the Crime Authority or the National Crimes Commission, as the Fraser Government wanted, and which would not be able to be completed by the Costigan Commission. I believe that the most graphic demonstration of that obvious state of affairs was in a letter written by Mr Fraser, the then Prime Minister, to Mr Cain, the Victorian Premier, on 25 October 1982, which letter was one of a number of letters that were released publicly earlier this week by Mr Cain. I am happy to read all of that letter if Senator Chaney is keen for that to occur. The most relevant parts read as follows: The Commonwealth recognises the need to allow for an orderly transition between the Royal Commission and the new body. I have advised Mr Costigan that the Government would, if necessary, consider extending his Commission beyond 1 July 1983 to ensure that this occurs. A little further in the letter there appears the following passage which is squarely pertinent to the sort of question that has now been raised for the umpteenth time today: The Commonwealth notes that Mr Costigan foreshadowed the need for an extension of some two to three years to enable him to complete his inquiries. Obviously, considerable work will be outstanding at 1 July 1983 as indeed it would be at the end of 1983. We would have in mind that the outstanding information which the Royal Commission has gathered would be made available to the National Crimes Commission to be dealt with pursuant to the legislation establishing it. So in 1982 Mr Costigan then claimed, as he still claims, that the nature of his investigations were open-ended and required a substantial additional period to be completed. The Fraser Government decided in exactly the same way as the present Government has decided that, in the words of Mr Temby recently, royal commissions cannot go on forever, particularly, royal commissions with limited terms of reference and inappropriate powers and structure cannot go on forever. There has to be a transition period. That transition process has to be set in place at some time and it is inevitable that whenever the transition process is completed and whenever the Costigan Commission is finally wound up, there would be loose ends and unfinished business. Against that background it is nothing but hypocritical humbug for us to hear the kind of nonsense being uttered-- Senator Chaney —Six months. Senator GARETH EVANS —Six months from 1982 takes us to early 1983. It is now, in case Senator Chaney has not noticed the date, late 1984. The reality of the matter is that whenever the transition process was set in train, there would be demands of this kind for further periods. The Costigan Commission has had a succession of extensions over the last 18 months, as it had a succession of extensions under the previous Government. The time has come to case this nonsense, to case this humbug and to cease this hypocrisy and let the National Crime Authority get on with the job which it is so well established to do. Senator Chaney —Mr Deputy President, I ask the Minister to table the paper from which he has quoted. Senator GARETH EVANS —I am delighted to put it on the record. Senator COLEMAN —The Leader of the Government in the Senate will be aware of comments on the current state of the economic recovery in Australia. Will he comment on the recent Australian Bureau of Statistics production figures and the state of the main economic indicators and whether they suggest that the economy is still recovering? Senator BUTTON —I am glad to have the opportunity that Senator Coleman has given me by her question to comment about the economy. It is something which the Opposition has singularly failed to do, particularly in this chamber, on the last two or three weeks. Senator Coleman mentioned the recent ABS production figures which, as I said yesterday, are not in the Government's view a good guide because one needs to look at all the indicators which are available. Even the ABS production figures show that in the three months to August this year, compares with the figures for last year, production rose for 20 items and fell for only seven. Real gross domestic product growth in 1983-84 in this country was a rate of 5.7 per cent. The rate of inflation fell substantially from the figure of 11.5 per cent in 1982-83, despite the announced commitment and announced policy of the previous Government to fight inflation first. In spite of fighting inflation first, inflation reached a figure of 11.5 per cent in 1982-83. Eighteen months later it is now down to 6.5 per cent. Unemployment was a matter which the previous Government was not committed to fighting first, or even second. It rose considerably to a figure in excess of 10 per cent in March 1983. The unemployment rate is now down to 8.9 per cent. Although that is not a satisfactory figure for any government, it is one which is gratifying in the circumstances of the last 18 months. There has been strong employment growth, with over 237,000 new jobs created between April 1983 and August 1984. Consumer spending is high and it rose by 2.5 per cent in 1983-84. The latest survey of consumer confidence conducted by the Melbourne University's Institute of Social Research shows consumer optimism at near record levels for this country. The prices and incomes accord, similarly, has contributed greatly to wage stability and industrial harmony. I remind the Senate that last year was the best year in terms of the level of industrial disputation in this country for 16 years. In summary, the broad range of indicators suggest that things are definately looking up. There is a mood abroad which contrasts sharply with that in the seven years of the previous Government. I make the point that none of this information seems to make Senator Chaney, the Leader of the Opposition in the Senate, particularly happy. Indeed, only recently Senator Chaney in his capacity as Leader of the Opposition in the Senate, sent a telex to the Prime Minister. If I might say so, it was a somewhat churlish telex, probably written on a Friday afternoon. That telex sought to make some sort of crude link between organised crime and the taxation policies of the present Government. One of the highlights of Senator Chaney's telex-and he asked a great number of questions-was that he asked the Prime Minister in particular whether he would guarantee that interest rates would not rise in 1985. I would have thought that that was an extraordinary question. Senator Chaney —Because some of your Ministers are taking credit for reduced interest rates. Senator BUTTON —The question that Senator Chaney directed to the Prime Minister was this: Will there be a guarantee that interest rates will not rise in 1985? I recall Ministers in the previous Government making some undertakings about interest rates. Indeed, Deputy Prime Minister Anthony, in 1977 I think, said that if interest rates did not fall by 2 per cent in the following year he would eat his hat. Senator Messner —They did come down. Senator BUTTON —Interest rates in fact rose during the following year, Senator. No politician, and certainly no statesman such as the Prime Minister, would give the sort of guarantee which Senator Chaney seeks. On the other hand, in discussing indicators generally, there was one indicator which I did not mention and that was interest rates, which have fallen. The anticipated outlook by a number of commentators is for a further fall in interest rates during 1985. The telex from Senator Chaney asked a number of other hypothetical questions about government taxation policy. Senator Chaney —Is this the Prime Minister's answer? Senator BUTTON —No, it is my answer. I was asked a question by Senator Coleman. Senator Chaney's telex asked a number of questions about government taxation policy. Let me say this: It is all very well to ask questions about these things , but I suggest that Chaney and his colleagues get their heads down and produce a taxation policy for the Opposition because time may be of the essence. Senator Chaney —Are you threatening us with an early election? Senator BUTTON —Not at all. I said time may be of the essence. I am thinking about Christmas. People are entitled to know before Christmas what the Opposition's taxation policy is likely to be. I assure the people of Australia that there will be no Christmas present because if they add up the promises made by the Opposition to date, there would be no room for any reductions in taxation . I expect that policy to be presented shortly and I expect it will receive a bagging similar to that received by the rest of the Opposition's policies. Senator MASON —My question is addressed to the Minister representing the Minister for Health. Did the Minister note that two people were killed in house fires in Sydney on Saturday night and that in each case fire authorities were reported to have attributed the fire to smoking. They were only the latest two of hundreds of fatal house fires and serious bush fires attributed to the tobacco industry. Does the Government know that for the past two years there has been strong pressure on the tobacco industry in the United State of America to market a self-extinguishing cigarette which goes out- Opposition senators-Oh! Senator MASON —I feel that the sounds coming from my right from Liberal Party Senators indicate that they have no sympathy for those people who indeed die in hundreds every year as a result of such fires. Senator Boswell will recollect that he is a member of the National Party. His constituents would say that bush fires caused in that way are a matter of grave concern. The DEPUTY PRESIDENT —Senator Mason, will you please put your question to the Minister? Senator MASON —Thank you, Mr Deputy president, I will return to my question. Does the Government know that for the past two years there has been strong pressure on the tobacco industry in the United States to market a self- extinguishing cigarette which goes out when dropped or discarded, and that such a product is perfectly feasible technologically? Does the Minister recall that 18 months ago I suggested that the tobacco industry develop such a self- extinguishing cigarette by self-regulation? This was a similar call to that being made to the industry in the United States. I ask the Minister: Since the industry has failed to do so, will the Government now institute an inquiry into this matter with the aim of compelling the tobacco industry to make cigarettes which are not a regular, fatal and completely avoidable life and property hazard to the community? If the Government does not wish to do this, will it acknowledge that it regards the tobacco industry as beyond all accountability for the enormous total of damage, death and disease that it causes? Senator GRIMES —I am afraid that neither I nor the Minister for Health were aware of the two cases mentioned by the honourable senator. However, I am aware that each year there are many fires in this country, resulting in death, which have started from cigarettes, frequently from people smoking cigarettes in bed. We are aware that there has been strong pressure from some groups in the United States of America for the tobacco industry to market a self-extinguishing cigarette. However, I think it is worth pointing out that the United States Government does not support this project at the moment and I do not know whether it will in the future. I am completely unfamiliar with the technology involved in the manufacture of such cigarettes and neither I nor the Minister for Health can comment on the feasibility of such cigarettes. I am sorry that neither I nor the Minister for Health are able to remember Senator Mason's making this suggestion some 18 months ago. Senator Chaney —Smoking ruins your brain cells and your memory. Senator GRIMES —Senator Chaney says that smoking ruins your brain cells and your memory. That is why I gave it up, I think, a couple of weeks ago. It is important to realise that this Government- Senator Walters —Too late. Senator GRIMES —We wonder what caused Senator Walter's trouble. Given that the Government is in fact committed to inhibiting the promotion of cigarettes with an aim of reducing tobacco consumption generally, one might think it a bit incongruous that we should institute an inquiry as suggested by Senator Mason into producing a fire-safe or any sort of safe cigarette. The simple fact is that there is no such thing as a safe cigarette. Tobacco related disease kills about 16,000 people a year in this country and accordingly the Government and the Department of Health will continue to direct their efforts towards educating the community on the dangers of smoking. That does not mean that I do not think that, if the tobacco industry could develop a fire-safe cigarette, it would not be a worthwhile thing for those unfortunate people in the community who find that they cannot give up cigarettes . I do not mean to suggest by that that the Government would do anything to inhibit the development of such a cigarette. I do not know that Senator Mason's comments on the tobacco industry are entirely justified but I must say that in my experiences with that industry in the past it has certainly been reluctant to put money into anything which suggests that its products are anything other than safe. That is unfortunate but I suppose it is an understandable part of that industry. I will refer to the Minister for Health the other matters raised by Senator Mason, if I have not answered them, and will get a full answer for him as soon as possible. Senator PRIMMER —My question is directed to the Attorney-General. Is the Minister aware of the serious disability caused to Canberra people imprisoned in New South Wales corrective services institutions? Will the Minister ensure that only criminals, not honest people fighting injustice, are sentenced to gaol? Can he provide an assurance that in future adequate transport and legal aid facilities will be provided to Canberra citizens unfortunate enough to interface with the New South Wales legal and prison systems? Senator GARETH EVANS —I as Attorney-General cannot ensure who goes to gaol and who does not. That is of course a matter for the courts in their sentencing processes. I have some considerable role in determining how long Federal prisoners stay in gaol and that is a matter of continuing anguish in the conduct of my portfolio as to how to apply the criteria and standards of imprisonment, particularly given the absence in the Australian Capital Territory of a gaol to house in this Territory Federal or Territory offenders. It has been a long- standing matter for public debate as to whether the Australian Capital Territory should have its own gaol, given the enormous cost that would be involved to the community for what one could expect to go on being a small prison population. It is the subject of investigation and report at the moment, I believe by the Human Rights Commission or some review body somewhere whose report I am awaiting in due course. In the meantime I will ensure that all steps that can be taken are being taken to follow up the particular matters to which Senator Primmer also referred about costs of transport and legal aid. The problem to which he adverts is not a new one but it is one that deserves the most serious attention and it is getting it. Senator ARCHER —I ask a question of the Attorney-General who will recall my asking questions on 30 November and 8 December last year following the publication of allegations in the National Times based on bugged telephone calls . When the Attorney answered those questions was he aware of a file note prepared by Detective Chief Inspector Moller of the Australian Federal Police as the basis for a possible parliamentary question and which referred to the payment of money for the upkeep of an interception facility used to make the recordings and the conclusion that it was doubtful that the interception was authorised? Senator GARETH EVANS —I have no recollection of any such file note but I will certainly check my files and records on that and see what further information I can give to the honourable senator. Senator CROWLEY —My question is directed to the Attorney-General. I have received a number of representations from scientists and medical researchers involved in epidemiological research. They are concerned that proposed privacy legislation which has received support from the Australian Law Reform Commission will effectively prevent proper and sufficient epidemiological research if medical records are unavailable to researchers without the permission of the patients. Can the Attorney-General say whether the proposed legislation will allow for necessary exemptions to permit adequate epidemiological research, guaranteeing anonymity of patients involved, to continue? Senator GARETH EVANS —The Australian Law Reform Commission's report on privacy addresses the very difficult problem of balancing the individual's right to privacy with the community need for medical research. The Commission recommends as one of the general principles of privacy protection that private information including private medical records should be available to researchers only if collected expressly for research purposes or if disclosed under requirement of law or with the consent of the subject of the records. There has been a great deal of concern among researchers, as Senator Crowley indicates, that the Commission's general principle may impede epidemiological research, that is to say study particularly using statistical surveys of patterns of illness and health problems across the community as a whole. The Government has received representations from researchers at the South Australian Health Commission, the Commonwealth Scientific and Industrial Research Organisation and ANZSEARCH, that is the Australia and New Zealand Society for Epidemiological Research in Community Health, among others. The most I can say at this stage is that my Department is currently engaged in consultations with the Department of Health and the National Health and Medical Research Council on the reconciliation of the Commission's proposed general principle and the needs of medical research. Certainly the Government's response to the ALRC recommendations will ensure that privacy legislation does not hamper the proper conduct of research. Senator REID —My question is to the Attorney-General. I refer to the meeting between the Attorney and State Ministers responsible for censorship which was held in Melbourne last Friday and which was called because of the shambles that has been created in regard to uniform laws for censorship of video material. Why are the Attorney and the State Ministers now fiddling around with proposed new classifications for violent material and even proposing a special classification of R+ for certain erotic material in the absence of any proper inquiry into public views on the matter? Why is the Government not proceeding with the joint parliamentary committee to inquire into these questions which was forced upon the Government by its back bench six weeks ago? Does the Government intend to set this committee up or is its tactic to stall the issue until the dissolution of the House of Representatives for the unnecessary early election prevents the committee being established? Senator GARETH EVANS —The Government is proceeding with the establishment of the committee. It certainly hopes to have it off and running within the next fortnight or so. If the honourable senator can give us some guarantee that her parliamentary colleagues will not use the occasion of setting up the committee for another four, five or eight-hour debate in which prejudices are rampantly paraded through this place, it might be possible to give her an undertaking about bringing that debate on in both the Houses rather earlier than might otherwise be the case. Of course there are difficulties with the time-tabling of legislation and other government business which make it difficult to give priority to something which is going to take a massive amount of time. It is certainly our intention to establish the committee because, as both I and other spokesmen have indicated in the other place, there is a job to be done in this area. The Government is not fiddling about with this issue in terms of trying to wrestle with the difficult problems of creating accurate guidelines. We do not adopt the robust approach of some members of the Opposition, that everything in sight ought to be banned without regard to any principles of free speech, free expression or the right of adults to view material in private. There are, of course, a number of competing public policy considerations which are relevant here. They are not easy questions to resolve but they are not helped in their resolution by the kind of pig-headed, narrow-minded attitude which so many people on the Opposition side have brought to bear in what is obviously a very sensitive and difficult matter for public debate. Senator CHILDS —Has the Minister for Veterans' Affairs seen criticism by ex- service organisations that no increases in war disability pension rates were provided in the latest Bugdet? Why were disability pensions not increased at the time even though other pensions were increased significantly? What is the legal basis upon which disability pension rates are set and adjusted? Senator GIETZELT —There has been some minor criticism by some of the smaller ex- service organisations about the failure of the current Budget to provide increases in war disability pensions, even though social welfare pensions, war widows pensions and other allowances were increased. I believe that criticism to be entirely misplaced. The Government has accepted that its prime responsibility at this stage is to increase social welfare based pensions to its objective of representing 25 per cent of average weekly earnings. The Government has also recognised that, as some pensioners were already entitled to free medical treatment, due to the impact of Medicare on the consumer price index and the automatic adjustments that followed there was particular need to provide for increases in those social welfare based pensions. The disability pension that Senator Childs referred to is a compensatory pension-it is not social welfare related-and therefore it is paid according to the assessed degree of Service related incapacity. This means, of course, that it is tax and means test free and is not treated as income as far as Service pensions are concerned. The Government's emphasis in this Budget was designed to meet its obligations and responsibilities in respect of social welfare type payments. I draw the Senate's attention to the fact that until 1977 the disability pension was adjusted by Government decision. Since then it has been automatically adjusted at six-monthly intervals according to movements in the CPI. That is laid down in section 35AAA of the Repatriation Act. I can say that recipients of disability pensions have not been disadvantaged in any way by the Budget increases to other pensions which are social welfare related. Their turn will come when the appropriate CPI adjustments are made. Senator DURACK —My question is directed to the Attorney-General and refers to his answer to a question yesterday in which he dismissed concerns that have been expressed by former royal commissioners and Justices Moffit and Woodward by claiming that the National Crime Authority was a more powerful body than a royal commission. Is it not a fact that the real or effective powers of the Authority or a royal commission are those requiring witnesses to answer questions and produce documents? Is it not further a fact that Mr Justice Stewart himself, the present head of the National Crime Authority, strongly argued in his report on the Mr Asia drug syndicate, as royal commissioner, that any national crime fighting body should be able to exercise these powers on its own initiative? Why will the Government not give the Authority the right to act of its own initiative in the exercise of its coercive powers? Is the reason that suggested by the former Mr Justice Moffit, in the article to which the Attorney-General was referred yesterday? When talking about the dangers of a political veto he said: They-- meaning politicians-- want to keep control so that they can have a look first and see whether it will be good politically to pursue such an inquiry. Senator GARETH EVANS —The Opposition and Senator Durack in particular really are gluttons for punishment on this issue. The Opposition felt so strongly about the lack of teeth in the Crime Authority as far as this particular matter of its having powers to vest in itself on its own initiatives that when it moved this matter in debate in this place by way of amendment to the National Crime Authority Bill it did not feel strongly enough about the issue even to take the matter to a division. Senator Missen at that stage, I recall, in response to that very decision by the Opposition that it was not important enough to divide on, lifted up his books and marched out of the chamber saying what a lot of weakies the Opposition senators were and made no further contribution to that debate. What a lot of humbug, what a lot of cant we are hearing on this issue. What better demonstration of it than that sally that has just been made by the purported shadow spokesman on legal affairs. Senator DURACK —Mr Deputy President, I have a supplementary question. I repeat the question-which was simply not answered-because of the Attorney's refusal always to answer questions: Why will the Government not accord this Authority a power which Mr Justice Stewart himself has said a proper crime authority should have, namely the power to act of its own initiative? Is it not a fact that the Opposition has at all times in this debated strongly advocated that proposition? Senator Grimes —You have succeeded in raising the dead. Senator GARETH EVANS —As Senator Grimes said, I have succeeded in raising the dead, so at least this exchange has had some contribution to make, whether to the public wheel or not I am not sure. To the extent that Senator Durack is relying on Mr Justice Stewart, I think it would be more appropriate and more honest for him to refer to the contributions Mr Stewart has most recently made to the public debate about the powers of the Authority when he said at various points along the way in a very lengthy Press conference a few weeks ago that he was perfectly satisfied with the powers of the NCA as they presently exist and believed that the Authority and everyone else should allow it a fair trial to get on with the job that it is carefully constructed to do. As to the matter of being able to vest coercive powers in itself of its own initiative, Senator Durack ought to recall that that was one of the most fundamental issues that was debated last year in the context of civil liberty protections and safeguards and questions of accountability to government, both Commonwealth and State. Do we create a royal commission type body with open- ended terms of reference, able to wander at large-to use the terminology of Mr Cain the other day-or do we circumscribe its sphere of action so that it has to justify itself to the democratic political process and to governments before it embarks upon the use of coercive inquisitorial powers that are quite unprecedented as far as police investigations are concerned and which obviously do involve very serious and large questions of principle? I know that the Opposition is totally insensitive to that aspect of the public debate and has been all along, but it is a very important policy matter that has to be taken into account and a very important consideration, along with all the other constitutional constraints upon vesting open-ended power in the Authority, particularly to deal with State matters, that were part and parcel of the construction of the Authority with the powers, functions and structure that it now has. I repeat that there is no substance whatsoever in the allegations about lack of effective teeth for the Authority and I believe it is about time that the Opposition went back to the sleep from whence it came on this matter, because it is doing nothing but damage to itself in attempting to pursue this particular issue. Senator SIBRAA —My question is directed to the Minister for Resources and Energy and concerns the new pricing and subsidy arrangements for liquefied petroleum gas announced by the Minister in March this year. It refers specifically to the 1 October adjustments that are part of these new arrangements. Can the Minister advise the Senate of the details of LPG price and subsidy to apply from this week? Senator WALSH —In conformity with the policy that the Government announced at the end of March this year, the price of LPG, be it the subsidised price or the non- subsidised price, will be slightly reduced as from 1 October. The basis of the policy announced on 1 March is that the wholesale price paid for Australian LPG, whether it be refinery LPG or oil field LPG, would be adjusted from a base in accordance with either the movement in the consumer price index fuel and light component or the export parity price, averaged over a period, whichever was the lower. The price has been reduced because the fuel and light component of the consumer price index fell slightly during that six-month period and the wholesale price paid to producers, the subsidised price paid by consumers and the non-subsidised price paid by consumers will all be reduced. The order of magnitude of the reduction is just over $3 a tonne. That is a small reduction and I would not want to make too much of it, but the more important point to be made-and one cannot expect that the fuel and light component of the CPI will continue to fall quarter by quarter or six months by six months-is that as a result of the pricing policy introduced in March of this year there will no longer be violent fluctuations in LPG prices in either direction, but there will be stability. That fact will be well appreciated, particularly I might add by local government organisations in Senator Sibraa's State of New South Wales. Senator MISSEN —My question is addressed to the Attorney-General in his capacity representing the Minister for Defence. It relates to the future use and ownership of the land at Point Nepean in Victoria, which is currently being occupied by the Army's Officer Cadet School. As the cadet school is to be moved to Canberra in two years time and the Defence Department will have no further need for the area, I ask the Minister: First, does he agree that it is vital that Point Nepean, one of the most scenic and historically significant areas of land in Victoria, be preserved for the enjoyment of future generations of Australians? Secondly, has the Army advised the Federal Government what it envisages as the future use of the entire Point Nepean area? Thirdly, what response has the Federal Government given to the stated wish of the Victorian Government, the Victorian Opposition and conservation groups to see the land is used as a carefully managed national park? Senator GARETH EVANS —The response I have from the Minister for Defence enables me to answer Senator Missen's questions as follows. First, I was asked whether or not I agreed that it was vital that the Point Nepean area be preserved for the enjoyment of future generations. Yes, I do, because the present historical and scenic value of the Point Nepean area derives partly from its long association with military activities and the intention given by its military tenants to preserve the environment there. Secondly, the army has proposed that its School of Health, presently at Healesville, and units of the Reserve should use facilities at Portsea after the Officer Cadet School transfers to the Australian Defence Force Academy in 1986. With regard to the response of the Federal Government to the stated wish of the Victorian Government and others who want to see the land used as a national park, the Minister for Defence has recently discussed the possible future uses of buildings and the present training areas at Point Nepean with the Victorian Government and he has asked his Department to undertake a thorough and comprehensive study of options for uses of the various facilities at Portsea after 1986. The Minister has indicated that the studies should take account of local considerations and State Government wishes. Senator JONES —My question is directed to the Minister for Veterans' Affairs. The Minister will be aware of my longstanding concern over mustard gas experiments involving service personnel in North Queensland during World War II, any subsequent ill effects suffered by these servicemen and whether they are receiving proper treatment and fair compensation for the ill effects. Can the Minister advise what progress has been made in identifying those who have experienced medical problems arising from the tests, and how many claims for compensation have been accepted? Senator GIETZELT —It is true that about 40 years ago the chemical warfare unit of the armed forces carried out experiments associated with mustard gas in Proserpine, Queensland. As the records are old it is rather difficult to be precise in this respect, but about 387 ex-servicemen were exposed to gas or liquid contaminants and of that number at least 137 have submitted claims to the Department of Veterans' Affairs. It is becoming a bit of a practice for volunteers to be called for in wars, whether they be major or minor ones, to take part in experiments. Many young men volunteer, as they did in that period, as they did again in the 1950s for the atomic tests in South Australia and as they did in Vietnam in the 1960s, not appreciating the effects that their actions may have on their general health. Subsequently claims are then submitted to the Department of Veterans' Affairs in which these men seek to show some relationship between their health and war service, requiring not only medical treatment but benefits. But of the 137, only 24 have so far been accepted as having health problems related to those particular experiments in Queensland, although many others are still within the system, which we are trying to improve as a result of the adoption of new determining legislation that has been passed by both the Senate and the House of Representatives. Senator JACK EVANS —My question is addressed to the Minister representing the Minister for Transport. Did an application by the Western Australian Government for about $1m of Australian bicentennial road development program funds for an extension of Farrington Road include an assurance that first, little or no environmental damage would result and, secondly, there would be no interference with Aboriginal sites? Is the Minister aware that this application was demonstrably misleading, that the environment is fragile, of great ecological significance and includes four listed Aboriginal sites? Is the Western Australian Premier currently investigating allegations that two of his Ministers , plus the head of the Environment Protection Authority, plus councillors of the Melville City Council have been duped into endorsing a false application for ABRD program funds? Will the Minister freeze these funds until a full inquiry has taken place and the whole proposal reviewed, including selection of an alternative non-destructive road plan? Senator GIETZELT —It is true that representations have been received by the Federal Minister for Transport from a number of Western Australian organisations and individuals concerning the proposed extension of Farrington Road in the cities of Cockburn and Melville, Perth. It appears that this particular road was approved under the Australian Bicentenary urban arterial roads project in October of last year after assurances were given by the Western Australian Minister for Transport that no sensitive environmental issues were associated with the project. Although the road extension was approved by the Western Australian Department of Conservation and the Environment, as well as the Environment Protection Authority as referred to by Senator Evans, it has aroused considerable local opposition and of course concern is being expressed by Federal Ministers about the project, which was approved by the Federal Government based on submissions from the State Minister. The basis of the opposition is damage to local wetlands and that the road is superfluous to traffic needs in the area. What complicates it from the Commonwealth's point of view is that of the two municipal authorities involved, Cockburn City Council is in favour of the project and the Melville City Council is opposed to it. However, as there are indications that some ecological damage may occur as a result of the construction of the road, the Federal Minister for Transport has telexed his counterpart asking for his urgent advice on the matter . As to the question of whether there has been duplicity, I am not in a position to comment upon that. As the Senate will be aware, roads selected for consideration under the Australian bicentennial road development program is a matter for the States. However, if it is shown that environmental problems have not been adequately considered, the Commonwealth will very seriously examine that matter on the basis of representations to it in response to the telex we have sent to the Western Australian Minister. Senator JACK EVANS —I ask a supplementary question, Mr Deputy President. The Australian Bicentennial Road Development Trust Fund has as one of its criteria the avoidance of environmental impact such as this, so I ask the Minister: As this natural heritage areas is still under daily threat, will the Minister ask the Western Australian Government to stop all road making activities on the Farrington Road extension until a review is undertaken by Federal, State and relevant local governments? Senator GIETZELT —I am certainly happy to refer that matter to the appropriate Federal Ministers, the Minister for Transport and the Minister for Home Affairs and Environment, because we would not want to be party to any irreparable damage that could be done. As I have indicated to Senator Jack Evans, the Federal Minister for Transport today has telexed his counterpart in Western Australia and if it is confirmed that there are problems associated with the project, we will certainly take urgent steps to see that all of the factors raised by Senator Evans are seriously considered by both the State and Federal Ministers concerned. Senator COOK —My question is to the Minister representing the Treasurer. Has the Government monitored the public's response to the 1984-85 Budget to ensure that the measures contained therein are well understood? Is the Government satisfied that opinion polls on the Budget published in the Sydney Morning Herald and the Bulletin have properly reflected public understanding of the issues, and is the Government satisfied that the televising of the Treasurer's Budget Speech and the Leader of the Opposition's reply has helped contribute to an improved understanding of the Budget and economic issues generally? Senator Chaney —Mr Deputy President, I take a point of order. All that the honourable senator is seeking is a series of political opinions for electoral purposes. It is an absurd question which has nothing to do with the administration of any government department, and to permit a question like that would reduce Question Time to a farce. I object to it. The DEPUTY PRESIDENT —The point is a valid one. The Minister representing the Treasurer must confine himself to responsibilities of the Treasurer and not to the responsibility of magazines. Senator WALSH —Very well, Mr Deputy President. Apart from the point of order, the answers to many of the questions asked by Senator Cook would be highly speculative; for example, to what degree the televising of the Treasurer's Budget Speech contributed to the Australian electorate's appreciation of the Speech itself and the Budget. People may believe whatever they like about that; it is difficult to know what they believe. On the substance of the Budget, the evidence-evidence as objective as one can get-indicates that the Budget has been quite well appreciated by the Australian people. Surveys conducted by commercial organisations before the Budget showed that some 12 per cent of the population expected to be better off as a result of the Budget about to be brought down and 30 per cent expected to be worse off. After the Budget, the number who expected to be better off had doubled, to 24 per cent, and the number who expected to be worse off had almost halved, having fallen to 19 per cent. Those figures for 1984 contrast sharply with the public perception of the 1982 Budget brought down by Mr Howard, following which, according to the same commercial survey, over 60 per cent of the people thought that they would be worse off. Of course they were correct. Members of the public displayed a great deal of perspicacity in their assessment of the 1982 Budget, 60 per cent believing they would be worse off. In fact, probably something more than 60 per cent were finally worse off. In conclusion, the commercial survey to which I have referred and which was published in the Bulletin on 18 September has shown that the 1984 Budget has been the best received Budget of any Budget for 10 years. Obviously that includes the Budget of 1982, and I think the public should be commended for its perspicacity in its assessment of the current Budget. Senator CHANEY —My question is addressed to the Attorney-General. I refer him to his answer to a question from Senator Collard earlier in Question Time today in which he referred to a letter dated 25 October 1982 from former Prime Minister Fraser to the Premier of Victoria concerning the Fraser Government's plans for the transfer of the work of the Costigan Royal Commission on the Activities of the Federated Ship Painters and Dockers Union to the proposed National Crimes Commission and his attempt to use that letter to justify the Hawke Government's handling of the transfer of investigations from the Costigan Royal Commission to the National Crime Authority. I refer the Attorney in particular to the second paragraph of that letter, and ask him: Does not that letter propose that the extension of the Costigan Commission would be to 1 July 1983, on the express assumption that the National Crime Commission would commence operation early in 1983? Does this not indicate a transition period of approximately six months? Further, I ask the Attorney whether Prime Minister Fraser said in the letter, in reference to ensuring an orderly transition: I have advised Mr Costigan that the Government would, if necessary, consider extending his Commission beyond 1 July 1983 to ensure that this occurs. Is it not clear from the letter from Mr Fraser to Mr Cain that the Fraser Government contemplated an adequate period of six months or more for this orderly transition by contrast with the Hawke Government's closing down of any investigation by Mr Costigan on 30 June this year, before the National Crime Authority was constituted on 1 July this year, leaving only three months with a belated extension to four months for briefing the new Authority and writing a report, and with no overlapping of investigations at all? Senator GARETH EVANS —No, there is no foundation for the series of assertions that has just been made. The truth of the matter concerning the proposal being hawked about by the Fraser Government in its legislation is best described in a further telex from the then, I presume, Acting Prime Minister, Mr Anthony, to the Premier of Victoria on 4 January 1983, in which the proposal was that the life of the Costigan Commission be extended until six months after the establishment of the National Crimes Commission or 31 December 1983, whichever occurred first. The logic of that, in case it has not occurred to the Leader of the Opposition, is that in the event that the Crimes Commission took longer than the middle of 1983 to get established and running, the transition period in fact would have been shorter than six months. That was just the logic of the particular formula that was adopted. I think it may have turned up in the statute. Certainly it was the executive formula that was being hawked around. A time period of around six months was contemplated by the previous Government, but there was no irrevocable commitment to it being six months or more than six months. The one irrevocable commitment in the then Government's position was that, come what may, the Costigan Commission would be terminated by 31 December 1983. It is now, in case nobody opposite has noticed, October 1984. Still the Costigan Commission is going and still it is going as a result of a series of extensions that were given to it by the Hawke Labor Government. The transition is proceeding. It is an orderly one. Nobody has anything to hide . It is exactly the kind of process that was anticipated by the previous Government. Yet again, it is cant, hypocrisy, humbug and disinformation for the Opposition to be claiming otherwise. Senator CHANEY —Mr Deputy President, I ask a supplementary question. In light of the Attorney-General's florid and inaccurate response, will he agree to the incorporation in Hansard of the letter which he produced so that his answer can be judged against the facts? I ask him to agree to the incorporation of this letter in Hansard. Senator GARETH EVANS —Yes, provided I can also incorporate the full text of the telex to Mr Cain from Mr Anthony which concludes with a copy of his Press release which he proposed to issue and which, for the record, is expressed in the following terms: Mr Anthony said that following its creation the National Crimes Commission would, for a limited time, operate in parallel with Mr Costigan's Commission during which time Mr Costigan would be able to finalise his inquiries and furnish his report. The Government intends that Mr Costigan's final report should, in any case, be made not later than 31 December 1983. I am delighted to have that incorporated, along with the text of the other matter, in Hansard. I seek leave to have the documents incorporated in Hansard. Leave granted. The letter and telex read as follows- Prime Minister Canberra 25 October 1982 My dear Premier I refer to our earlier correspondence concerning an extension of time for the Costigan Royal Commission. As the Acting Attorney-General has discussed with you, the Commonwealth has agreed to extend the Royal Commission to 1 July 1983 on the assumption that the National Crimes Commission will be available to commence operations early in 1983. As the Acting Attorney-General informed you by telex on 13 October, the Commonwealth is introducing legislation to establish this body. The Commonwealth recognises the need to allow for an orderly transition between the Royal Commission and the new body. I have advised Mr Costigan that the Government would, if necessary, consider extending his Commission beyond 1 July 1983 to ensure that this occurs. In response to a request by the Royal Commission for guidance as to its future planning, the Commonwealth is indicating that, while it does not seek to direct the Commission as to how it should carry out its functions, it sees certain areas of priority for action by the Commission in the remainder of its term. These priorities would be action to facilitate the efforts of the Special Prosecutors and their Task Forces in prosecuting the offences highlighted in the interim reports and action to finalise discrete segments of the investigations, particularly those relating more directly to the Painters and Dockers Union. The Commonwealth notes that Mr Costigan foreshadowed the need for an extension of some two to three years to enable him to complete his inquiries. Obviously, considerable work will be outstanding at 1 July 1983 as indeed it would be at the end of 1983. We would have in mind that the outstanding information which the Royal Commission has gathered would be made available to the National Crimes Commission to be dealt with pursuant to the legislation establishing it. You may wish to consider whether the National Crimes Commission should be authorised to investigate breaches of Victorian law arising from that information. The Acting Attorney-General will be discussing with you the Commonwealth's intention to establish the Crimes Commission and the general question of participation by the States. I am asking the Acting Attorney-General to speak further with Mr Costigan and with you concerning the future of the work of the Royal Commission and the transition to the National Crimes Commission. I have written to Mr Costigan advising him of this. Yours sincerely Malcolm Fraser The Hon. John Cain, M.L.A. Premier of Victoria, Melbourne, Vic. 3000 FROM DEPT PRIME MINISTER AND CABINET 475 4.6.83 PK TO THE PREMIER OF VICTORIA FROM THE ACTING PRIME MINISTER IMMEDIATE RRRRRRRRR RESTRICTED My Dear Premier COSTIGAN ROYAL COMMISSION I propose to announce that the Governor-General has approved the extension of the reporting time for the Costigan Royal Commission into the Federated Ship Painters and Dockers Union until six months after the establishment of the National Crimes Commission or 31 December 1983, which ever occurs first. I have asked the Attorney-General, Senator Durack, to consult with you early in the new year about the future work of the royal commission and arrangements for transition to the National Crimes Commission, as foreshadowed by the Prime Minister in his letter of 25 October 1982. The text of the Press release is as follows: 'Extension of time for Costigan Royal Commission into Federated Ship Painters and Dockers Union activities The Acting Prime Minister, Mr Anthony, announced today that Mr Costigan, Q.C. had been given an extension of time to make his final report on his inquiry into the activities of the Federated Ship Painters and Dockers Union. Mr Costigan, who had been required to make that report by 31 December 1982, will not be required to do so until six months after the establishment of the National Crimes Commission, or 31 December 1983, whichever occurs first. The Government's intention to establish the National Crimes Commission as soon as possible was announced by the then acting Attorney-General, Mr Brown, on 15 December after the Bill to establish the commission had passed all stages in the Parliament. Mr Anthony said that following its creation the National Crimes Commission would, for a limited time, operate in parallel with Mr Costigan's Commission during which time Mr Costigan would be able to finalise his inquiries and furnish his report. The Government intends that Mr Costigan's final report should, in any case, be made not later than 31 December 1983.' Yours Sincerely (J. D. ANTHONY) ENDS: 10.20 AM PREMIER AA32636 PRIMIN AA61616 Senator GARETH EVANS —Yesterday Senator Teague asked me two questions about the Perry matter, another piece of Opposition humbug. I would like to supplement the answers I gave to clarify and complete the public record. His first question was whether I or anyone from my office had advised Mr Perry of approaches made to me by the Age on 18 June concerning the representations I made to the Minister for Immigration and Ethnic Affairs on Mr Perry's behalf which were, of course, the subject of a full statement in this place on 13 September last. As to that question, yesterday I said 'no', as to myself, and 'I believe not' as to my staff. I can now confirm, having checked with my present and former staff, that no such communication of any kind was made. The second question put to me by Senator Teague was whether I knew of approaches to the Age by Mr Perry himself with respect to the Age story, which approaches may have led the Age, as Senator Teague said, to change its security system. Yesterday I said that I had a recollection of reading somewhere, perhaps in the Age, about such an approach by Mr Perry but I could not give any details as to it. I am now able to say that where I read this was not, in fact, in the Age but in two statements by Mr Peacock. First of all, there was Mr Peacock's infamous little crook speech on 13 September, which he will now have a nice long retirement to regret. At page 1,255 of the House of Representatives Hansard of 13 September Mr Peacock stated, referring in the first instance to me as Attorney-General: Did he speak to Chadwick or to Perry? He did. That is a lie, as I have made clear in my own statement in this place. He continued: Is that why Perry went to the Age and menaced- Senator Chaney —I raise a point of order. It is still unparliamentary in this place, if not in the other place, to use that kind of language. I suggest that it be withdrawn. The DEPUTY PRESIDENT —The Attorney-General should withdraw that remark. Senator GARETH EVANS —I withdraw the expression 'lie' and substitute 'untruth'. I proceed as follows with the quotation: is that why Perry went to the Age and menaced reporters, threatening them, the day after Senator Evans spoke to editor Burns? The second passage I have turned up was in an interview conducted by Mike Willesee with Mr Peacock on 24 September in which the following exchange occurred. Mr Willesee said: . . . you're talking about Mr Stuart Perry, I presume? Mr Peacock replied: That's right. Mr Willesee continued: You call him a 'hit man' without giving evidence of him being a 'hit man' which is against our natural approach to justice. You specifically said that he'd threatened and menaced 2 Age reporters who went to the Age and the Editor. Mr Creighton Burns, said that was not true. Mr Peacock replied: Well let me say in answer to that, Michael, that the evidence led at the Royal Commission itself described him ''as a totally professional criminal''. Now you can interpret that any way you like, but that was before the Costigan Royal Commission . . . Mr Willesee said: Yes, he admits that he was a criminal . . . Mr Peacock continued: . . . beyond that you might ask the editor of the Age whether he wrote a letter regarding statements made by Mr Perry to his journalists, to the Victorian Police and you might ask whether there was any upgrading of the security of the Age after that call by Mr Perry on one of the journalists. I'll say no more because we're both constrained somewhat here . . . That is what I vaguely recalled having seen yesterday. There we have two statements on the public record, one quite explicitly, the other impliedly, saying that Mr Perry had gone to the Age threatening and menacing journalists. To complete the public record on this matter and to demonstrate once again the incapacity of Mr Peacock even to begin to lie straight in bed when it comes to these matters, I put on the public record the following communication from the Age to the Willesee program on 17 September. I put that communication on the public record with the consent of the editor, Mr Burns. The statement, which was communicated to the Willesee program, reads: The editor of the Age, Mr Creighton Burns, said tonight that Mr Perry came to the Age office and spoke to reporter, Lindsay Murdoch, and the day editor, Patrick Boyce. Lindsay Murdoch had some days earlier spoken to Mr Perry on the telephone in relation to a story he was working on. Mr Perry explained to Murdoch and Boyce the reasons for his approach to Senator Evans through Storeman and Packers Union official, Mr Ron Chadwick. He made no threats and did not menace them. However he said that he would be unhappy if the Age would have published a story which he saw as unfairly prejudicing an application for a visa. That was signed 'Creighton Burns'. I think, yet again, that places on record the utter incapacity of Mr Peacock to stick to the truth and to anything resembling decency and fair play when it comes to smearing, innuendoes and claims about Australian Labor Party associations with organised crime. I hope that Senator Teague will accordingly express his regrets for having raised the matter in the way that he did yesterday. Senator GARETH EVANS —Earlier in Question Time Senator Archer raised with me a matter that was the subject of a question to me on 30 November last year. I have now had an opportunity to refresh my memory on that matter which was no doubt raised by Senator Archer following certain evidence that was given to the Senate Standing Committee on Privileges by the editor of the National Times a few days ago. The situation is this: I have no reason whatsoever to amend anything I said in my answer in the Senate on 30 November of last year. Neither my Department nor I was briefed on or was aware of Chief Inspector Moller's file note referred to in Mr Temby's report, which note raised the question as to whether the alleged intercepts, the subject of the Age tapes affair, were in fact authorised ; nor was, I understand, the Special Minister of State briefed on the existence of contents of that file note. My speculative reference in my answer to Senator Archer to the possibility that the source of the transcripts of the material may have been a listening device was based on a briefing that was provided to me at the time by the Australian Federal Police and the Department of the Special Minister of State. I add to that that I understand now that an investigation is being made as to why the information obtained by Moller was not acted upon. The existence of that note was fully disclosed in the Temby report on the Age tapes affair. Senator CHANEY(Western Australia-Leader of the Opposition)(3.08) —by leave-I move: That the Senate take note of the answer given by the Attorney-General (Senator Gareth Evans) this day, to a Question without Notice asked by Senator Teague on 2 October 1984 relating to the immigration status of Mr S. J. Perry and approaches to the Age newspaper. The Attorney-General (Senator Gareth Evans) has just indulged himself in his usual verbal gymnastics when he is pouring abuse on the Opposition and anyone who happens to disagree with him. I would like the Senate to contrast his behaviour this afternoon with his behaviour yesterday when he tabled a police report relating to papers tabled in this place by his colleague Senator Walsh. Those papers were thoroughly discredited by the police report. They were described by the police as probably a malicious fabrication. I heard none of the wrath; I heard none of the wonderful, vigorous speech that we have heard today when the Attorney-General was attacking the Leader of the Opposition (Mr Peacock ). Senator Grimes —What do you think he is-stupid? Senator CHANEY —In reply to the interjection by the Minister for Social Security , yes; I think he is stupid. I thank the Minister for putting that question to me. I think he is utterly stupid. His behaviour in this place is completely standard. I just want to remind the Senate that for month after month the Attorney-General tolerated the blackening of names of people from this side of the chamber and the moment Mrs Murphy's name was mentioned he scurried off, got a report and brought it into this place to show that this allegation was malicious fabrication. All I can say is that the standards of this Attorney- General are so patently and absurdly inadequate for the office that he holds that he stands yet again condemned out of his own mouth. I seek leave to continue my remarks later. The DEPUTY PRESIDENT —Is leave granted? Senator Gareth Evans —No. Senator CHANEY —Well, I will keep on talking. Senator Gareth Evans —The Leader of the Opposition has been denied leave to continue. Senator CHANEY —That is right. In that case I will keep going. Senator Gareth Evans —I take a point of order, Mr Deputy President. If the honourable senator has been denied leave to continue his remarks, he can hardly now continue. The DEPUTY PRESIDENT —There is no point of order. Asking leave to continue one's remarks is a special way of adjourning debate in the Senate. Senator CHANEY —I wish therefore to speak in more detail on the matters that I have been talking about. We had a little display here this afternoon from the Attorney-General when because his activities were being challenged, once again he showed a great deal of nervous and other energy in tracking down the facts. He was very anxious to bring into this place a statement which explained his position. We all know the delicate position that is adopted by the Attorney- General in these matters. We all know that he is as man who is beyond reproach. He carries the proud title of Attorney-General. He is the defender of the public interest. He has acknowledged to me that that is his role as Attorney-General. I simply wish to say that there has been no evidence in this place in the last year and a half of the Attorney-General accepting that acknowledgement and understanding the role that he is supposed to play. I wish to refer to the report which the Attorney-General brought into this place yesterday when he dealt with the allegation that there was some link between Mrs L. Murphy and Christo Moll. We heard the pathetic sorts of excuses that were put out by Senator Walsh when this matter came up for debate. Senator Walsh tried to suggest that there are a lot of L. Murphys in the phone book and not many N. Crichton-Brownes. That was his attempt to excuse himself from the smear evidence. But the Attorney-General really got himself off his tail on this occasion and got the Australian Federal Police to report to him, and it was found that the allegations which linked the wife of Mr Justice Murphy to a Christo Moll cheque stub could not be substantiated and could be malicious fabrications. We heard no protest at all from the Attorney-General in regard to his ministerial colleague Senator Walsh, who brought into this place not on one occasion but on a series of occasions unsubstantiated allegations. He attempted to smear members of the Liberal Party in Western Australia, using documents which were unable to be verified, and the Attorney-General who has voiced such outrage here this afternoon about the behaviour of the Opposition is himself guilty of the most appalling double standards. I have said in this place before that the standards which are required of the Attorney-General are different from the standards required of Senator Walsh or of the Minister for Social Security, Senator Grimes or indeed of any other Minister. The Attorney-General has a role which is acknowledged even by him as giving him obligations which go beyond the obligations of partisan politics. What I am saying is that in his conduct in this place Senator Evans shows no understanding at all of those basic obligations. The fact of the matter is that yesterday he allowed without comment a smear to be lifted, a smear which had been repeatedly put down by his colleague, and today he comes in and in his usually extravagant way proceeds to throw a farrago of words at the Opposition to justify his own mean-minded and petty performance. The Opposition is contemptuous of this behaviour on the part of the Government. We were able to censure Minister Walsh for his behaviour when we met a fortnight ago. I think that Senator Evans is moving to the stage where he deserves similar treatment. Senator GARETH EVANS(Victoria-Attorney-General)(3.14) —I will speak very briefly on this motion. There are lots of things I can say but I should not burden the Senate with the full force of my reply. I will simply make a couple of points. The Crichton-Browne allegations that were made in this place about his connection with the cheque stubs in question were not at any stage, as I recall, the subject of an express or explicit request from either the senator concerned, Senator Crichton-Browne, or from Senator Chaney, that there be an immediate specific police report. Senator Crichton-Browne —Because there was already a police inquiry under way, and the Attorney-General knows it. Says so; tell the truth for a change. Go on, Red Beard. Senator GARETH EVANS —That may be the reason why the honourable senator was happy to wait. That may be the reason why he felt that his reputation was not so much at risk that he did not want to pursue the matter immediately. I simply draw the Senate's attention to the difference between that state of affairs when no such request was made for any immediate report, inquiry or vindication, if such were possible, of the honourable senator's name, and the situation which confronted me when I was requested for such an immediate investigation and an immediate police report, a request which I put before the Senate within minutes of its having been made to me. When that request was received I specifically asked that there be a report made back to me through the Special Minister of State (Mr Young) on the progress of the ongoing police investigations in relation to the Moll affair, both in relation to the Ingrid Murphy allegation and to the extent that the same factual questions seemed to be raised by it on the matter of Senator Crichton-Browne. When that report was received by me I put the answer down yesterday in language that was moderate in the extreme-I believe even Senator Chaney will acknowledge that-to the extent that I did not in any way seek to calumnify Senator Chaney for dragging into the Senate under cover of privilege the Murphy affair. Senator Chaney —I did not. That is a misrepresentation. Senator GARETH EVANS —Senator Chaney was the person who raised the Murphy diamond matter and expressed indignation about that state of affairs and wanted to know what was being done about it. Senator Chaney was not content to let the matter rest in the Press where it had been mentioned that morning. He was the one who wanted to raise it as a national issue in this Parliament. Obviously the motives for doing so are exactly the same as the motives that have led the Opposition to raise the matter of Sala, have led the Opposition to raise the matter of Saffron and have led the Opposition to raise accordingly the matter of Moll. Anything is good enough to throw against the name of Mr Justice Murphy. There are matters in which that learned gentleman is now defending himself before processes established by this place, and I make no comment about those. I do however make a comment about the way in which systematically that man's name has been attempted to be dragged through the mud by smear and innuendo of the kind that has proved in the past to be utterly unsubstantiated. The Sala affair and the Saffron affair have both been the subject of full investigations. Now, too, the Moll diamond affair has been the subject of investigations. But intensely or as passionately as I may have felt about the squalid character of Senator Chaney's introduction of that issue into the parliamentary forum, I made no adverse comment about that yesterday in putting down my reply. It would not have been appropriate under the circumstances to make an adverse comment about anyone else whose allegations might equally have been thought to be the subject of that investigation. The charge is utterly without substance and utterly without foundation. The difference between my reaction to this matter and the performance put on by the Leader of the Opposition in hurling around smear, innuendo and filth is plain for all the world to see and needs, I believe, no further elaboration. Debate (on motion by Senator Reid) adjourned. Senator CRICHTON-BROWNE(Western Australia) —by leave-I claim to have been misrepresented by the Attorney-General (Senator Gareth Evans). I will be brief on this occasion. I was out of the chamber at the time that the Attorney-General commenced his speech but I understood him to be saying as I left my office that I did not ask for a police report in respect of the allegations made by Moll and Walsh collectively because I was not game. Senator Gareth Evans —I did not say that. Senator CRICHTON-BROWNE —I say to the Attorney-General that he did. I will check Hansard tomorrow and if I am wrong I will withdraw it. You said words to that effect, and that implied that if I was not game I must have believed that there was some truth in the allegations. It therefore follows necessarily that the results of yesterday's finding come as some surprise to me. Either I know whether I am innocent or I know whether I am guilty. I knew all along that the truth would be well out. I knew there was a police investigation under way and that I could expect no special assistance or support from the Government in having that matter clarified and brought forward as quickly as possible, as was the case with Mr Justice Murphy. Senator Gareth Evans —Why didn't you ask? We are all heart when it comes to you. Senator CRICHTON-BROWNE —I would not expect to interfere in a police investigation. I expect the normal processes of the law to take place. That is what ultimately happened. I add that I was aware of the cheque stub and cheque relating to Mr Justice Murphy, as I have been for many months, but I refused to table that in the Parliament. I refused to make reference to it because I believed it had the same status as the documents that had been tabled by Senator Walsh previously, namely that they were scurrilous documents without foundation. I could find no justification-- Senator Gareth Evans —Why didn't your Leader have the same scruples? He couldn't stop himself rushing in here after it appeared in the Press. The DEPUTY PRESIDENT —Order! Senator Crichton-Browne is entitled to make his personal explanation. Senator CRICHTON-BROWNE —I could find no justification for dragging in the name of Mr Justice Murphy or his wife to try to muddy the water to demonstrate my innocence or the status of those cheques. All it would have done was damage his reputation in a way that Senator Walsh sought to damage my reputation. Thus I very conscientiously ensured that the information which was in my possession was not made available not only to the Parliament but also to my colleagues. The thanks I get for that is the sort of abuse I have had to put up with in the last few minutes from the Attorney-General. Month after month I have listened to what Senator Walsh has said about me. He has said that there was a prima facie case for the claim that Crichton-Browne was associated with Moll. On a number of occasions he interjected: 'Tell us about Moll'. On one occasion when that was raised and I responded to it the Attorney-General said: 'I thought you would keep your head low now after what has been alleged about you'. This is the man who claims to act with decency and who takes great exception to any suggestion of allegations against him. He sat here very bemused and amused, smiling and smirking when I was attacked. I sat here and put up with it month after month, when I could easily have got up and dragged Justice Murphy's name into it and also the names of other members of the Australian Labor Party who are well known to the ALP and to the police. Senator Grimes —On a point of order, Mr Deputy President, I suggest that this is getting a bit beyond a personal explanation. It is now more like a tirade. The DEPUTY PRESIDENT —Order! Senator Crichton-Brown claimed to have been misrepresented. He is covering that matter at the moment. Senator CRICHTON-BROWNE —As has been seen, some notable names are known to the police. They are closely linked to the ALP. There are senior financial members of that Party with whom Moll has claimed association, yet I have refused also to name them. The DEPUTY PRESIDENT —Order! Senator Crichton-Browne, you may not progress into that area. The DEPUTY PRESIDENT —I have received a letter from Senator Messner proposing that a matter of public importance be submitted to the Senate for discussion, namely: The Hawke Labor Government's revised assets test which continues its attack upon the retirement security of aged Australians. 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 MESSNER(South Australia)(3.23) —The matter of public importance which I have brought forward today is as follows: The Hawke Labor Government's revised assets test which continues its attack upon the retirement security of aged Australians. We bring this matter before the Senate today in the absolute knowledge that the vast majority of Australians of all age groups strongly support the sentiments that are included therein. Recent opinion polls across the age spectrum continue to demonstrate that Australians oppose the assets test. They also feel that this Hawke Government is intent on destroying their retirement security by various means which I will develop later in my remarks. Suffice it to say at this point that in a recent Age poll it was shown that 62 per cent of people thought that the recent Budget, which has been so heavily extolled in this place and in the other place by members of the Government, did not do enough for pensioners. It is interesting to speculate on what the result of that poll would have been had the question asked been: 'Do you agree with the Government's attempts to harass pensioners through increased taxes on pensions announced in the Budget?' The last Budget, of course, put very significant imposts on pensioners. In fact we find that figures provided by the Parliamentary Library show that a single pensioner, with $20 a week other income, instead of paying $20 a year in tax as was the case last year, this year will pay $109. In the case of a pensioner on the full pension with $30 a week additional income that figure goes from $244 to $313 this financial year. This comes from a Government which has claimed it is doing more for pensioners in this Budget. However, the 62 per cent of people polled in the Age poll know the truth and know that that is totally false. The new assets test arrangements which have been the subject of debate in this place for many months and, of course, have been the subject of debate in the public arena as well, are still not clear and are still generating considerable concern in the community. For instance, the recent recognition of the fact that occupiers of granny flats at the back of homes are now to find themselves caught in the provisions of the assets test whereas people who own their homes in other circumstances would not be so caught is of concern. This is another addition to the growing list of anomalies and injustices that have been caused by the assets test legislation which is now law. This comes on top of the other very significant imposition of taxation on lump sum superannuation payments. We know how that has generated such terrific concern in the community, not only amongst pensioners and retired people but also amongst the trade union movement itself and industry. The number of people who oppose the assets test should include Senator Grimes, the Minister for Social Security. We have only to remember his lines in Labor Essays written before the election in 1983 when he said: To be consistent, those who argue for a pensions assets test should also argue for the personal income tax to be supplemented by a substantial tax on personal assets-in other words, a wealth tax. Two or three things can be said about that. Senator Grimes may believe that having introduced an assets test we should now have a wealth tax. If that is so, why does he not stand in this place and say so? Why does not the Government make the point before the election that it intends to introduce a wealth tax and a capital gains tax so that people can make a decision on that matter when they go to the polls? The second point that can be made is that he obviously had very little support in his own mind for the idea of an assets test. That was later borne out by his remarks at the famous National Economic Summit Conference when he said quite clearly to the assembled multitude-those from the trade union movement and industry-that if an assets test were brought in the effect on the general pensioner would be such as to produce very little extra revenue which could be distributed to the needy, that in fact in that way there would be very little extra money available to the community for the most needy in the community. What then was Senator Grimes's reason for introducing this assets test? At one point along the way he said that it would be part of the introduction of a national superannuation scheme. How can that be so? How does that make sense when he starts with the proposition that in order to introduce a national superannuation scheme, which implies that there will be general availability of a universal pension for all, he must start by taking money away from pensioners who are presently in receipt of it? That just does not make sense. Obviously there needs to be a very clear statement by the Minister as to his objectives in this area. The only obvious objective that can be divined from the actions of the Government in recent weeks and months is that it is concerned about the so- called issue of double dipping. That, of course, is the situation where people so arrange their affairs as to circumvent the present incomes test. The theory goes that an assets test would be able to catch those people and so ensure that the benefits went to the most needy. Indeed, that may have been the Minister's objective. But if that is so, why does the Government not examine that issue in depth? Why does it not examine the reason people arrange their affairs in the way they do? We in the Liberal and National parties would be quite confident that if it went to that trouble it would find that the main reason people so arrange their affairs is the eligibility requirements for the pensioner health benefit card. In fact, people as a result of receiving a pension become eligible for a pensioner health benefit card. Recent studies by the Department of Social Security indicate that fringe benefits add maybe up to $100 a week to the income of pensioners. Is that not a mighty strong and powerful incentive for people to arrange their affairs to circumvent the present income test? I once again draw that matter to the attention of the Government. I urge the Government to examine in very considerable detail the fundamental issues that are involved here rather than trying to attack the issue at the top by seeking to cut off what it would term to be the 'tall poppies'. The question of just who are those tall poppies also is very important. The Minister for Veterans' Affairs, Senator Gietzelt, is very keen to call these people pension cheats. In fact, a list of the top 124 pension cheats was published in a newspaper some six or eight months ago. Those names were clearly drawn on the wrong information. But the Minister sought to use that information in such a way as to create scares in the community. People came to look upon those in the list as committing some kind of fraud on the community. However, in fact I put it to you, Madam Acting Deputy President, that even if these people were involved in the so-called double dipping operation, the reasons for their involvement need to be examined closely, and it is the very point about the national health benefit card that I have just mentioned which is at the core of that problem. To hear members of the Government carry on at great length about a welfare system that should be needs based one would think that there is no needs based system presently in existence and that, of course, is absolutely wrong. We already know that the income test is applied very stringently against people receiving full pensions. We know that over the last 10 years or so the proportion of full pension received by people has declined from around 90 per cent to around 70 per cent. So, in fact, the income test has been successful in reducing people's reliance on the Government for a pension and in that way there is already in place a needs based system which is very effective. The second point is that there is a vast misunderstanding in the community about that fact. Because the Government has sought to equate the idea of an assets test with a needs based system, the two have become synonymous and, indeed, one cannot talk in general terms about needs based welfare these days without talking about the assets test. That, of course, is absolute nonsense which was perpetuated even in an article written in today's Age newspaper by a commentator called Claude Forell who has picked up all the old hackneyed stories and bits and pieces about welfare. Without analysing any of the information he has come down with the proposition that in fact the assets test seems to be a good idea. He does not analyse any information. He said he seeks alternatives. But in fact, as far as I know, he did not seek information from the Opposition in respect of its position . He claims that we apparently have no alternative. That, of course, is absolute nonsense. Indeed, I think I have demonstrated those clear alternatives in the course of the remarks that I have been making. But let us then look at the broader picture of the retirement income. I must say that there has been very little debate in this Senate chamber on the question of occupational superannuation. The Government seems to have run away with the idea that somehow there is a vast pot of money going down the drain to the very rich in the community by virtue of some 45 per cent of the work force being included in employer sponsored superannuation. That percentage, of course, is absolutely true and we on this side of the chamber would like to see that 45 per cent increased rapidly as it has, of course, in the last 12 years. In fact, since 1972 the proportion of the work force in occupational superannuation has almost doubled. We see employer sponsored schemes in which employees as well as employers contribute to future benefits as the best way for members of the work force to build up a future sum which they can live off quite reasonably in their retirement. This partnership or incentive, if one likes, offered through the tax system gives people the opportunity to save for their retirement. We believe that that is a very powerful and strong incentive for people to build up their own nest eggs during their working lives and we want to encourage it. The Government has introduced a tax on superannuation which is received in such circumstances. The Government says that people should not receive lump sum superannuation payments, that superannuation payments should be made by way of an annual or weekly pension. We, of course, object to that because we believe that people should have the option of choosing either form of superannuation. The next point is that the Government-and this was repeated in the article in the Age this morning-says that there is a cost to the taxpayer of $2,500m because of the taxation incentive for people in superannuation funds. It is argued that this money would be better used for people who receive pensions, that is, the more needy members of the community. I suppose that is a fine argument except that it ignores the facts. In fact, if we take into account the amount of income tax that is received by the Treasury as a result of the investment of lump sum payments, that figure of $2.5 billion falls to something under $1,000m. Will the Government tell me how many needy people in the community it could help with that very small amount of money. So that argument is totally fallacious and without foundation. However, it keeps getting repeated in the newspaper articles and deserves to be knocked on the head. Probably the most significant thing that the Government has done since it came to office in respect of those in retirement is the introduction of the Medicare arrangements for the aged. We now have situations where people who live in aged person's hostels and other age accommodation run by community based organisations are having to insure themselves privately outside of Medicare arrangements simply because there are no public hospital beds available for them . Of course, we are seeing the start of a decline in the availability of private hospital beds as well because private hospitals are being forced out of business as a result of the Medicare arrangements. This Government has not realised that we will be facing a crisis or, if it has, it has failed to do anything about it. It is an absolute disgrace that the aged, and particularly the frail aged, are the ones who are being cast onto the streets by this Government. This is at the core of our concern on this side of the House when we raised this issue today. I must reiterate that the challenge in dealing with the problems of the aged lies in dealing with the problems of the frail aged, those who are suffering from Alzheimer's disease and senility. It is that problem which this Government is failing to address and doing absolutely nothing about. I know that bits and pieces are being started by some departments in this area, but there is no comprehensive plan. If one wants to define the needy amongst the aged in the community, they are to be found in that category. The Government should be acting to make sure that it helps that group of people. Instead, it goes about destroying the security which people have currently developed under retirement income plans which are already available in the community. The objective of the Government is to make as many Australians in retirement as possible totally dependent upon the Government. That is in total opposition to the position of the Liberal and National parties which seek to encourage independence so that people can build up nest eggs for their retirement and put money aside so that they can use it for the purposes which they deem to be important. I make another point which I think is terribly important. The Government, by making people dependent upon it, is putting those people in a most insecure position. The reason is that governments change and rules change. Pensioners have learnt that lesson to their cost since April 1983 when the Hawke Labor Government was elected and so many benefits have been withdrawn. It is for that reason that the kind of proposition which the Government is seeking to perpetrate on the retired people of Australia is leading to a greater sense of dependency, and a greater sense of insecurity rather than the reverse. There is no security in relying on government pensions as one's only source of income. The only security will come from a diversified field of investment so that people can draw upon many sources for their freedom of action to invest, work and save. That is the Australian way. Indeed, one would have to have some doubt about the credentials of the Prime Minister, Mr Hawke, when he says that he is looking after the most needy when he has introduced these various measures. Finally, I make this point: At the meeting of the Economic Planning Advisory Council the poor were treated as the pariahs. They were treated by the Government, in the words of Mr Bruce McKenzie, the Chairman of the Australian Council of Social Services, as being irrelevant to the discussions and they were not treated as part of the economy. That is the proposition which this Government has regard for when it talks about the needy-they are not a part of this economy, and that is not the position of the Liberal and National parties. Senator GILES(Western Australia)(3.43) — We are debating this afternoon a matter of public importance, the first part of which reads: 'The Hawke Labor Government's revised assets test', which I agree is a matter of public importance. But the second part rather spoils the effect when it goes on to state, 'which continues its attack upon the retirement security of aged Australians'. I take up initially the final point made by the previous speaker, Senator Messner, who insists that this Government is treating non-earners in this community as pariahs. Of course, that is totally incorrect. What we have seen over the last 18 months is strenuous attempts by this Government to try to overcome the years and years of neglect of the previous conservative Government which did not treat its elderly, its non-earners and its other disadvantaged as pariahs; it just shelved them and refused to face up to the very serious problems that were developing in the community. Over those years we asked, as members of the Opposition, time and time again what was to be done about the increasing evidence of rorting of the social security system, the amazingly contrived arrangements that were being perpetrated by insurance and other financial institutions around the nation to persuade elderly people to avoid declaring income over those years by placing what in many cases were small amounts of capital in non-interest bearing accounts. This was becoming a scandal and the previous Government was simply unprepared to do anything about it. Perhaps we have not as yet hit on the perfect solution to these problems. But at least we are moving, at least we are facing up to these difficult questions, and at least we are trying to introduce some equity into the system. I say to Senator Messner that Claude Forell is not an orphan in believing that this policy is at least an improvement on the neglect and the head-in-the-sand attitude that was taken by the previous Government towards this problem. There was an inevitability about the fact that some action would have to be taken. It needed a government with some intestinal fortitude to take it. The needs criteria had been agreed between the two main parties. They were issues on which we never argued. But the means by which needs could be identified and by which justice could be introduced into the system have certainly been a matter of severe disagreement over the years. We have seen, of course, a greatly escalated demand on governments of all complexions for income maintenance; not only for pensioners of course, but also for other people in the community who depend upon the Government for the maintenance of their standards of living. I do not believe, as has been suggested by Senator Messner, that there is something scandalous, something immoral or something not quite right or just about depending on the Government for income maintenance. It is a matter which is considered to be one of the central tenets of social justice, surely, that those who are unable to support themselves, to maintain a dignified standard of living as a result of their own efforts, should be assisted to do so by governments. Over the last 40 or 50 years we have seen a great change in what is known in Australia as the dependency ratio. In fact it is members of that group within the community who are very largely dependent on governments and the philosophies of particular governments for the standard at which they will live, the standard of education they will receive as young people, the standard of income maintenance they will experience when they reach old age, when they become invalids or are for some other reason unable to contribute to the economy of the country. Projections were made for Australia during the Borrie National Population Inquiry about what this dependency ratio might be during the next few years. It is a matter for debate, I suppose, as to how the dependency ratio should be actually equated. But the usual and accepted method on the whole is to add the percentages of that group in the population whose members are under 14 years of age and the other group in the population whose members are over the age of 65 years. The projections indicate that the numbers of those aged over 65 will rise very slowly as a percentage of the population, from 9.6 per cent in 1981 to 11 per cent in 2001-not a very dramatic increase when one looks at what has actually happened over the last 20 years. For example, in 1966 the dependent age ratio was 61.25 per cent, which was not even as high as in 1961 when the dependent age ratio was 63.46 per cent. At this stage we can look at a dependent age ratio of about 52 per cent, which will drop over the next few years as a result mainly of the fairly low birth rate during the late 1960s and 1970s and the very low birth rate during the late 1920s, 1930s and the early 1940s. So the dependent age ratio which exists now of about 53 per cent will still be only about 53 per cent in the year 2021. The implication of this, of course, is that we do not as a nation have a great deal to fear in regard to our economic resources in relation to the standard of living that we can guarantee to the aged people in our community over those years. In fact the period in which there was a very marked escalation in the number of aged people as a proportion of the population was during the 1960s. As far as very old people are concerned, according to Professor Borrie, even in the year 2031 the relation of young old people, that is, old people between the ages of 65 and 75, to old old people, that is, those over the age of 75, will be 64: 36; a negligible change from the ratio today which is 65:35. Of course, what we see with the aging of the population is a greatly increased level of activity and a higher level of health generally amongst aged people. I am sure there are many honourable senators here this afternoon who have every intention, as I have, of becoming a very healthy 80-year-old, in not too many years time. Of course, our insistence on a decent method of administering pensions in this country is not simply a matter of cost; it is a matter of equity between particular groups in the population who have a claim, and we believe a thoroughly justified claim, on the public purse. As I have said, this is a matter which has the agreement not only of the majority of educated and thoughtful writers commenting on the assets test but also of a great number of pensioners, both individuals and pensioner associations, who are very well aware of the fact that there have been manipulations of assets over the years that simply are not available to the vast majority of pensioners who have nothing to live on except their age or invalid pensions. I am grateful for the opportunity this afternoon to air this matter, especially in view of the fact that this debate is being broadcast, because I believe it is an opportunity to provide some light and some accurate information for those people in the community who have been seriously misled, and very deliberately misled I believe, over the period since we started seriously discussing the necessity and the desirability of introducing an assets test. I believe that the very modesty of the recoupment that we expect immediately is evidence of this Government's bona fides in its approach to the issue. We have acknowledged all along that the direct savings will be relatively small, perhaps in the vicinity of only $50m in the first year, and will of course affect only the pensions of a very small percentage of aged people. However, other implications of introducing this assets test go back to those issues that I discussed earlier in relation to equity, the fact that it will affect very few pensions. I believe the Department of Veterans' Affairs was able to show exactly how the system could be engineered by people who had means, and significant means, and who were able to dispose of those means so that there was no apparent income from them. They had the advantage of those means, as would their families subsequently, without any effect on their pensions. However, the principle of a social wage or a social income applies just as much to the aged as to any other group in the community. It is a principle which, in addition to making certain to the extent it is possible that pensions and other income supplements from the Government are set at economically feasible levels, also provides to the extent that it is possible a decent and dignified standard of living. Actual incomes are not the only way in which governments can greatly enhance the quality of life of particular groups in the community. Measures that have already been taken by the Labor Government have made great differences, for example, to the level of inflation. Of course, this is of grave concern to the elderly who live only on pensions and who are concerned greatly at the price of staple items such as food and clothing that they must buy out of those pensions. Surely the fact that interest rates have come down must affect not only young people in the community and those of middle age who are still buying homes but also at least some pensioners who have been forced to borrow money in order to buy necessities and in whose interests the lower interest rates certainly operate. Our concern to provide housing for all of the lower income sectors of the community must surely also be an advantage to aged people. Our great concern to increase the stock of public housing-a stock which was allowed to fall in a quite catastrophic and scandalous manner during the last 7 or 8 years-is another matter which is of considerable and crucial importance to many pensioners. Despite Senator Messner's lack of acknowledgment of this fact, a recent meeting of Ministers for Social Security, Health, and Veterans' Affairs announced a major program to which the Commonwealth will contribute $300m over the first three years, a not inconsiderable amount, and one which it is rather difficult to ignore. This amount will be substantially increased when the State and Territory contributions are included as they maintain their commitment to the programs. Of course, community care under existing cost-share programs is contributed to by State and Territory governments as well as the Federal Government, but has been lacking badly in some States. Like housing, over the last eight years community services have not increased to anywhere near a level which would provide access to them for more than the current small proportion of the aged community. This package of measures being introduced under our home and community care program includes expansion of existing services to the aged at home, delivered meals, home maintenance, home nursing and paramedical services. Additional services which will be considered for funding include personal care, transport, linen and laundry services and community based respite care. There are already models for all these measures which are humane and efficient methods by which the quality of life for the aged can be substantially enhanced within the home and which add to the range of options available to the elderly and to their carers who may be in need of regular or occasional assistance. Total government spending on general home care services in 1984-85 will rise to over $90m, an increase of nearly 50 per cent. Measures of great importance to significant groups and individuals amongst the aged include an increase of 10 per cent in recurrent subsidies to approved hostels for the frail aged and an increase in the respite care subsidy to approved hostels. There will also be assistance with bed retention fees in nursing homes to keep beds for patients who are temporarily absent and to provide for admission to those beds of aged who can be cared for at home but whose carers are in need of respite, or those aged who need only a few days or weeks of nursing in the sense of constant trained attention. These initiatives will go a long way to ensuring peace of mind. They are measures the need for which should have been obvious to the previous Government but about which no action was taken. Hostels caring for elderly patients with dementia, Alzheimer's disease, as referred to by Senator Messner, are to receive increased special assistance. This should avoid the necessity for at least some of the substantial proportion of aged suffering from this disease to be admitted to nursing homes simply because of the extra supervision and security that they need. The home community care program will also involve the development of inquiry and information services within the Department of Health. These services, in conjunction with the development of assessment teams, will ensure that elderly people receive services appropriate to their needs and to their preferences. I will return briefly to the assets test and the criticism that has been made of it by the Opposition and by other people in the community who simply cannot or will not understand what is being advocated and how we will implement it. I think I can do no better than to quote briefly an excellent article by Philippa Smith, published in the Sun Herald on 30 September, headlined: 'And now to fill in the assets test form'. It is simply stated, and I strongly advocate that people who are still feeling puzzled or worried about the assets test should try to get hold of this article. I will quote as much as I can in the time that is left to me. Senator Martin —What is the source? Senator GILES —The Sun-Herald of 30 September, an article by Philippa Smith. It states: From November information about the assets test will be sent to all pensioners in Australia. There will be two sets of information and forms. The first will go to 85 per cent of pensioners, and gives details of the test and the threshold limits. It will have to be completed only-- I repeat, only- if the pensioner believes that his or her assets are over the threshold. If not the pensioner is advised to 'do nothing' and the pension will continue uninterrupted. If the amount is over the threshold they are asked to request an assets test statement form. About 300,000-or 15 per cent-of pensioners will be asked to complete and return a four-page statement of assets. At first glance the form may appear a little daunting, but it has been designed to lead the pensioner through each question step by step. The forms have been redesigned and simplified after market research and consultation with pensioner groups. As one pensioner said 'all forms are bad-but this one is better than most'. The department said its decision to have this two-pronged approach was designed to reduce the intrusiveness and the numbers of people who need be worried by filling in the forms. The 15 per cent who will be asked to fill in the assets statement form have been identified by the following criteria: Pensioner homeowners who receive income from real estate holdings: . . . . and pensioner non-homeowners who receive income from real estate . . . In conclusion, I do not think I can do better than quote a pensioner who, when asked 'How do you, personally, feel about the proposed changes?' replied 'The only thing I have to worry about is that if I had the money I would worry. I don 't have any assets to worry about now'. In that respect that pensioner is very similar to the vast majority of pensioners in Australia today. Senator SCOTT(New South Wales-Leader of the National Party of Australia)(4.03) -I rise to contribute to the debate on the matter of public importance this afternoon concerning the Hawke Australian Labor Party Government's revised assets test which continues its attack upon the retirement security of aged Australians. Indeed it is exactly that, a revised assets test. It has been revised I think two or three times, clearly because of the concern that basically exists in the very people to whom it is directed, to whom it is supposed to be a contribution. The measure of doubt and inconsistency and the measure of concern are very considerable and certainly genuine. Consequently it is little wonder that it has been revised many times. One of the fascinating things about this is that the legislation, when it is eventually put into effect , will have little capacity to raise any significant amount of money. It will have an insignificant capacity to raise funds that might be properly and hopefully directed to people whose need is the greater. Indeed there is almost a boastful measure in the assertion that it will affect only 2 per cent of pensioners. That is a figure that is widely disputed. Some would have the figure at 15 per cent and some would have it at 20 per cent. The variation ranges from 40,000 to perhaps half a million people who will be affected. So there is a great deal of variation and that, in itself, is the evident background of doubt and concern that the community has about the assets test legislation. I make the point that in the first place the actual contribution in terms of money in regard to this much discussed and debated legislation is almost nothing to the people that it purports to aid in their various circumstances. So there must be another objective. I want to look at that objective rather than at a range of statistics, which I am sure the community from time to time becomes a little tired of. What could the other objective be? It could be found in an examination of the philosophical base of the legislation that was put before us. The philosophical base of it is that there is no reason to have a society in which there is an element of reward for initiative, in which there is an element of reward for people who seek to provide for themselves the capacity to enable them to pursue in their retirement years the type of lifestyle that they want. That is the very essence of a free society and, I believe, the very essence of the sort of Australian society that we seek to pursue. Indeed, on the philosophical angle, there can be no doubt that the assets test has been watered down because in the relatively near future an early election appears to be part of the program of this socialist Government. Consequently it is reasonable to assume that the legislation, which is philosophically socialist legislation, needs to be watered down, at least in the short term. I suggest that that is exactly what has happened. The philosophy of this Government quite clearly is socialism. It has every right to pursue its philosophy, as that is the right of us all, but let us be aware of it. Around the world today, in most of the developed countries, the philosophy of socialism is being or has been very largely rejected. For instance I think of recent elections in Canada where one of the most enormous majorities was achieved by basically an anti-socialist government-if I recall, 211 out of 280 seats, or something in that area. The socialists in the United States of America are not prominent but the political party that represents them more closely than any other has not been doing remarkably well in recent times. The situation of the socialist dominated Labour Party in the United Kingdom is probably worse today than it has been for many years. I could go on to mention West Germany or I could refer honourable senators to Mitterand's France. He had to do a complete about-face within 12 months in order to keep a few of his industries within the boundaries of his home country. The point I make is that quite clearly this legislation is the product of a socialist government, a government that sees that government should be the master and not the servant of the people. That is the basic question that confronts all Australians. It is clearly to the fore in this legislation, reduced as it has been. The amount that is to be saved by this difficult and complicated intrusion into the privacy of people-the ultimate result of this in a financial sense-is virtually negligible as far as the Australian retirement population is concerned . On the other hand it intrudes into this field a socialist philosophy which I do not believe Australians en masse promote or believe in. The whole history of this country-the whole of its tradition and its exercise-has been far removed from socialist theories and it is my view at least that it is still that way. So , on grounds of financial contribution and certainly on the ground of philosophical contribution, this legislation is of little or no benefit to the Australian community. I confine some of my remarks to a couple of sections of the community-the range of ex-servicemen and women, the veterans' field. These people are dramatically involved because 80 per cent of their numbers are now in the over-60 age group. In 15 more years it is estimated that 150,000 of Australia's veterans will be over 75 years old. Consequently, they have an enormous concern with the measures that are brought about by Australian governments in relation to retirement incomes. It seems to be totally wrong that a retirement income should have so many conditions surrounding it that any attempt by people to provide the circumstances, in the form of assets, for their retirement in order to have that extra capacity to lead the lifestyle they might seek, is to be denied them. To some significant degree that is the circumstance in this proposed legislation. Indeed, there is a cut-off of $100,000. On the surface that appears to be generous, but if a person exceeds that by just $21,000 he or she stands to lose about $42 a week. In those circumstances, it is rather farcical to try to promote the view that this is of no consequence, that only 2 per cent of the population will be affected. Of course it is more than 2 per cent of the people and of course it is of significance and widespread consequence. That is just one simple example-$21,000 extra and one is cost $42 a week in retirement income. There is a fallacy around that this legislation affects virtually no one and that it will provide more money for those who really need it. That is certainly not the case. Indeed, the real danger is much more important and people should take note of it. The real danger is that the assets test in its relatively small circumstance at this stage is the base and the absolute and clear foundation for an assets tax, which indeed is a wealth tax. Senator Messner —Senator Grimes agrees with that. Senator SCOTT —Of course Senator Grimes agrees with that; he has said so many times. People are rapidly realising that it is not the legislation before us today-the proposition that affects the retirement population in Australia, 2.5 to 3 million people-that is so important. The proposition that is important is its nature as the thin end of the wedge-the imposition of a wealth tax in this country. There can be no doubt about that. The assets tax can be seen purely and simply as the basis for a wealth tax. That is what it is all about. In philosophical terms a wealth tax has the capacity to deny people a real opportunity to pursue whatever they seek to pursue within the laws of the land and to benefit from the production, to gain reward from the initiatives, and indeed in some cases from the privations, that they observe during their lifetime. I have in mind particularly the Australian soldier settler who may have been settled on a relatively small block of land. With his family he has not only cleared the block, fenced it, developed it and cultivated it but has battled to make something of it. Very often those are the people who went through the Depresssion years in their teens and, having converted their relatively small asset into a unit which is productive for its size, they are now to be faced with the fact that increased land valuations and so forth will create a value on that, 10 per cent of which is presumed to be income when the fact is that the return to capital in Australia's primary industries is something like 2 per cent . It is assumed that someone in the retirement age group who has battled on a property for most of his or her life is to be granted 10 per cent of that value as income and consequently put outside the field of a retirement income capacity . That is an impossible situation. If one looks at that particular group of people in another field-the repatriation-hospital-medical area, for example-one finds that the Medicare legislation has given them an alleged alternative or option between Medicare and repatriation, yet no one is choosing the public hospital in the Medicare area. Recently the 60 days in hospital was reduced to 35 before the imposition on these people of $11.85 a day as a nursing home payment if they wish to remain in hospital. This legislation is totally in-- The ACTING DEPUTY PRESIDENT(Senator Collard) —Order! The honourable senator's time has expired. Senator RICHARDSON(New South Wales)(4.17) —I rise to speak on this matter of public importance and like many senators on this side of the House I am offended by the words 'attack upon the retirement security of aged Australians'. I belong to the Australian Labor Party, a party with a proud history, a history of innovation and commitment in the field of social welfare; commitment to raising the standards of those weaker members of our society who have for so long been raped and attacked by those on the other side of the House. Over the past 12 months we have witnessed in Australia a deliberate campaign of misinformation, of fear and scaremongering from the Liberal Party of Australia and the National Party of Australia, in an attempt to convince the aged and the frail aged, to whom Senator Messner referred, that this assets test will affect them in great numbers. Yesterday the Prime Minister (Mr Hawke) referred to the efforts of the Liberal and National parties in the last election campaign in March 1983 when they attempted to take that fantastic 'put your money under the bed' line during the campaign. That was one of Malcolm Fraser's great contributions. Senator Boswell —They should have done so. Senator RICHARDSON —Senator Boswell probably thinks that they should have but unfortunately for him three-quarters of the Australian population do not agree with him. When one looks at the rating of our respective leaders, one sees that 75 per cent of people think that the Prime Minister is okay and only 25 per cent think that Andrew Peacock is. That is the way that Australia has gone in the last 12 months because that 'put your money under the bed' line, that pathetic scaremongering, was just an insult to the intelligence of the Australian people. They threw the Liberal and National parties out in March 1983 and when we have an election in the near future, be it November, December or March, they will throw them out again. This is just another chapter of this recently written novel of desperation by the panic-stricken, leaderless rabble opposite that masquerades as a political force. This Liberal-National Party coalition's disintegration was witnessed yesterday. Who could forget the headline in the Sydney Morning Herald today, referring to Andrew Peacock's performance yesterday, of 'Death in the Afternoon'. Now, on the second afternoon of these two weeks, we witness another rather ordinary attempt, hardly one of the coalition's spectacular efforts-though we do not see many of those nowadays-to discredit this Government that has done so much for Australia' s aged in such a short time, and which will do so much more given the certainty that the Australian electorate will entrust to it in the near future the running of the country for another three years. Let us go back to the assets test and see how many people it may effect so we can begin to debunk the myth that the Opposition is trying to create that in some way the Government is prepared to attack the aged people of Australia. Of course the huge majority of Australian pensioners will be exempt from the test. That is being found out now as the Department of Social Security sends out the assets test forms to millions of Australian pensioners. A basic form will be received by 85 per cent of pensioners, and they need do nothing because as they read it they will find out that nothing is expected of them. They are not even required to fill in anything; no extra information is wanted from them. The Government accepts that they are, without any test, exempt. So we come back to the 15 per cent of pensioners who will receive a form which will require them to make some declaration of their assets. Even in that group the vast majority will not in the end be affected. It is estimated that less than 2 per cent of Australian pensioners can ever be affected by this test. The Government got to that stage over a long period of again showing the Australian people that it believes in consensus and that it can listen to them. I received, I am sure like every senator here, many representations from pensioner groups and individual pensioners who were concerned about the assets test as proposed in its original form and the Government in its wisdom, after considering all those representations over such a long period, came to the view that the family home should be excluded. When we exclude the major asset that most Australians can ever acquire, of course we eliminate from the net many of the people who may have been worried in the first place. So now we have a test in which only the wealthy among pensioners can possibly be hit. Married pensioners would need to have assets in excess of $100,000 before they were affected, and before the pension cut out completely they would have to have $177 ,000 worth of assets. That is a significant amount of money and I do not really believe that those who have such assets are not able to have a secure retirement in any case. The claim that every aged Australian is under attack is shown by these figures to be nonsense. It is not just the family home that has been excluded from the test. Also to be excluded are permanent fixtures, whether they be a garage, swimming pool or whatever, special aids for the disabled, pre-paid funeral expenses, and an interest in an estate not yet realised. The list goes on. These things are all excluded. When we look at what is included in these very high asset amounts, which I will get to in a moment, we come firstly to holiday homes . I know that some pensioners have made representations, and certainly some trade unions have made representations to me on behalf of members, be they railway or municipal employees, for instance, who have bought holiday homes on the coast. The Government looked at that situation and made sure that it set levels so that the great majority of those pensioners who have holiday homes still will not be affected by this test. Other real estate and boats, et cetera, are included but I am not sure that many of our pensioners are running around in huge cruisers so I do not know that it will be such a great problem for them. A value of $10,000 has been placed on personal possessions and household items. That has been done not just so people can believe the promises of politicians but also to have it down in black and white so they know that all this empty talk of inspectors tramping through the houses of ordinary Australians is nonsense. Indeed, 85 per cent of pensioners will be excluded automatically and there will be no reason for them to have that fear. Assets disposed of in excess of $2,000 a year for a single person or $4,000 a year for a couple without adequate financial return will be taken into account. Such a provision will apply but the assets limits are very high indeed. Again they were set after consultation with trade unions and pensioner groups and after listening to the voices of the average pensioners, the little people, who came forward in their thousands to express their concern. Not nearly so many are expressing their concern now. We have gone from a period where all our offices were besieged with telephone calls to a period during which, in my office, there has not been one call on the assets test for quite some time. Senator Messner —They have given up on you. Senator RICHARDSON —They managed to come to me when they were worried about their family home. I think I had a role in ensuring that the home was deleted from the test. The great difference between Senator Messner and me is that I can have an effect on Australian Government policy; he can have none. The assets limit is, for a single pensioner, $70,000. Fringe benefits are not lost until $ 80,000, and the limit reaches $117,000 before the pension cuts out. For a single pensioner renting and not owning his or her own home, the levels are $120,000 worth of assets, $130,000 before fringe benefits cut out and $167,000 before the pension cuts out altogether. Again the figures for couples are very high. I have already mentioned the figure of $100,000 for couples owning their own home but for renting couples the figures are $150,000 before the pension is affected, $ 165,000 before fringe benefits are lost and $227,000 before the pension cuts out altogether. Given those high figures, no one can paint this as some sort of draconian test. Of course when one talks about an attack on aged Australians one has to look not just at the assets test but also at the benefits that the Australian Labor Party has sought to give to those who are getting on in their lives. We have looked at only one aspect here today but we have to look also at what the Government has done for pensions overall. When this Government came to office, as in so many significant areas of need in Australia, it acted immediately to redress just some of the neglect. We have only to look at what the Fraser-Howard Government failed to do for so long. For instance, its $2 increase in supplementary rent assistance in 1982-83 came at a time when rents were going up $10 a week. It was typical of what happened during that period. But it is the actual pension rate that really counts. We lifted pensions, and from November this year they will rise $2.50 a week for single pensioners and $4.20 for couples. The pension rate has increased from 23.2 per cent to 23.8 per cent of average weekly earnings, and we have to remember that 18 months ago, under Fraser and Howard, it was at 22 per cent. The Australian Labor Party is committed to raising the level higher still, to 25 per cent, and with each opportunity presented to us we will continue to increase those levels. The Government has put an enormous amount into the home and community care package to ensure that we have a wide range of initiatives in community care for the aged-a much wider range than has ever been available in the past, and a comprehensive range that is integrated with community care services. The Commonwealth contribution will be $300m in the next three years. It behoves all honourable senators opposite who speak in this debate to tell us just what they did during their period in office. In the 1975 election speech of Malcolm Fraser, at the start of that reign that will long be infamous in Australian history, he began by saying: We stand by our commitment to abolish the means test on pensions. In 1978 the Fraser Government reapplied the means test for over 70-year-old pensioners. When we look at the claims in 1984 of what the Liberals might do we have to look at what they did do when they had the chance. In 1975 Malcolm Fraser said: The real value of pensions will be preserved. When Labor left office the level of pensions had gone up to 24.5 per cent of average weekly earnings. When Malcolm Fraser left office the level had gone down to 22 per cent. I might say that we have done the very best we can to ensure that pensioners are informed. The hotline that has been set up to handle queries from pensioners on the assets test to try to ensure that our elderly are not taken over by this fear campaign took 22,000 calls prior to May and has taken 10 ,000 calls since. I turn to some of the support that has been given for an assets test. It is not just the Australian Labor Party that has welcomed it. The Confederation of Australian Industry, in a long statement of 18 April this year, came out in support of the reintroduction of an assets test. The CAI said to the Senate Standing Committee on Social Welfare: If the present system continues unchanged then the demands on community resources to support the provision of retirement income will increase dramatically over the next few decades, possibly to unmanageable proportions. We all remember Sir William McMahon. Only a few weeks ago on Michael Schildberger's program in Melbourne he said that while 'assets' was an irritating word-'means' was better-the Government's decision was right in principle. In a statement that must go down in the annals, I might say, of hopefulness, he said: Mr Peacock won't be opposing it 'when he gets there'. Of course, the Young Liberals have opposed it. In conclusion, I think we should turn to the comments of Michelle Grattan from the Age. In an article published only a few weeks ago, in August, she ran a quote from Senator Chaney-- The ACTING DEPUTY PRESIDENT(Senator Collard) —Order! The honourable senator's time has expired. Senator MARTIN(Queensland)(4.32) —Senator Richardson, when opening his speech, referred to the proud history of the Australian Labor Party on the subject of welfare. I think that the behaviour of this Government in its attitude towards the elderly must be the sorriest chapter in that history. Nothing is more important to a society than how it treats its aged and nothing is more revealing of the socialist philosophy than its policies towards the retired. Today we are debating a matter of public importance which refers to this Government's assaults on the aged. I, as have many other members of parliament in the last few months, have been approached by many elderly people distressed about the policies of this Government towards them. How have the elderly been treated by the Labor Party? It was Senator Giles, a Labor senator from Western Australia, who, on speaking earlier this afternoon, said that people have been seriously and deliberately misled. As I recall, Senator Richardson used that as part of his theme. I ask the Labor senators who are so willing to support publicly the Government's policy on the aged to look back at a few other statements that have been made by their Ministers. I ask them to look at the assault made by the Minister for Veterans' Affairs (Senator Gietzelt) on the so-called millionaire veterans a few months ago. I ask them to look at the assault that the Minister for Social Security, Senator Grimes, has made on the elderly generally in orchestrating a campaign that this country cannot afford the future burden of the elderly. Those two Ministers are grossly guilty of deliberately, seriously misleading the Australian public as, for some time, have a number of newspapers. Senator Richardson, towards the end of his speech, referred to the statements made by the Confederation of Australian Industry in April this year and those made by Sir William McMahon. I have no doubt that Senator Richardson could have trotted out a litany of references along the lines that he mentioned were made in April of this year. He will find that they are getting a little thinner on the ground now as people know what this assets test involves and as people understand how they, their elderly relatives and others they know are actually affected by this test. People are discovering that this is not at all an issue of equity-that is the latest buzz word in this debate apparently-but a question of the inevitability of inequity in an assets test. Senator Giles accused the Liberal-National Party governments of doing nothing, of not being prepared to look at the issue. I remind Senator Giles, who was a senator at the time and who should remember it, that there was a time when the Fraser Government looked at an assets test for the elderly. While the Fraser Government was looking at it, Senator Giles and all the other Labor senators beat drums loudly-we had not even announced at that stage that we were going to have one-terrifying people about how they would be affected. The Fraser Government looked at an assets test. It took all the advice-I daresay it was the same advice as was given to the Hawke Government-and rejected the assets test. We looked at the implications of an assets test and realised that far from being a matter of equity and welfare it led inevitably to great inequities and the social cost, not to mention the financial costs, that we all now face, was not worth it. In fact, those who had been claiming that such a test was necessary for various reasons were in error. I recommend to people that they cast their minds back to the statements made by Senator Gietzelt and Senator Grimes. The line that has been peddled so assiduously by Senator Grimes, who will speak later in this debate-he has not been present for any of this; probably he is listening to some of it in his office, but nevertheless he is not here to hear all of it-is that the country cannot afford the alleged burden of welfare and particularly the supposed future burden of the elderly. At the beginning of my speech I said that nothing is more important as a measurement of a society's worth than its attitude towards the elderly. For months now the word that repeatedly has come out of Labor mouths and has been printed in Labor Press statements on the subject of the elderly has been 'burden'. There is an element of burden in the elderly just as there is an element of burden in babies. They do require assistance. They are not as capable as those in the prime of their life of ordering their affairs. There is that element, but the government or the country that is not prepared to face that burden is a government or a country which has no basic human decency. Part of the effect of this campaign on the alleged future burden has been to intimidate and isolate the elderly. Since this whole sorry business arose, I have encountered many elderly people, who are not frail aged people but who are vulnerable as most elderly people are, who have been made to feel that they are somehow unworthy of the society in which they live, that they have been cheating it; they have been defrauding it. That is how they have been made to feel. It has been a clever campaign in that sense. Every time the Minister says 'Oh, but it is only a small percentage' those people feel more isolated and more vulnerable, because most of them do not know to which percentage they belong-the small percentage or the large percentage. Even worse, many of those who had assumed, because their assets and incomes are so modest, that they were part of that larger percentage that would be untouched have found that by the very nature of this test they are the ones who are the special target of this massively expensive bureaucratic exercise. I give Senator Giles credit for the fact that in her speech she gave some facts about the demography of this country. What she said utterly accorded with what Senator Messner, the shadow Minister for Social Security, and other Opposition members have been saying all along. She said that we do not have a great deal to fear as a community from the aging of the population. Of course, Senator Messner was not on his own in promoting that concept in recent months. He was amply supported by the Gruen Panel of Review of Proposed Income and Assets Test. The Gruen Panel found that we would not have a future burden of the dimensions which have been parroted for months by the Minister for Social Security and other members of the Hawke Government. I recommend to Labor senators that they read Senator Giles's speech and go to the references she gave. I also recommend that they read the Gruen report. It will not be easily available to them, but I also recommend the information given to the Government by the Department of Social Security. It has been given to the Senate Standing Committee on Social Welfare. It has been given limited reporting in the newspapers and the Department's findings coincide with those of the Gruen Panel. Labor senators and members of the Hawke Government will find that the expert advice available to the Government when it took its decision was that an assets test was not necessary. It is not even a question of a minor burden, but it has been easy to fool a few people. As I have said, the term 'equity' is a buzz word these days. Senator Giles used it quite a few times. I waited throughout her speech to take note of her explanation of the equity of the assets test, but I did not get one. There has been some reference to an article in the Melbourne Age of today, written by Claude Forell. I will read a small part of it. He supports the Government's line and criticises the Opposition. He says: The reasons for adding an assets test to the income test are twofold. One is that the proportion of people in the community paying taxes most of their lives is diminishing-- This has already been refuted by Senator Giles-- while the proportion dependent on welfare has increased dramatically and will continue to rise. That is fudging. There is a higher proportion of people dependent on welfare in Australia today compared with some few years ago and there is a higher proportion of age pensioners in the population than there was some few years ago . But Senator Messner has stated over and over again in the Senate and in his Press releases, which Mr Forell presumably receives even though he apparently does not read them, that the highest proportion of people dependent on welfare are those on unemployment benefit. We admit that the welfare vote has increased, but Labor people trot out this increase and say: 'Ah, we cannot afford the elderly. We have got to put them through this assets test. We have got to get personal information from them and put it on a computer'. There are no assurances as to what will happen there. Forell goes on: There is a simple and equitable alternative to the assets test, and that is to let the elderly enjoy their assets without worries, so long as they live and then impose Federal death and gift duties on their heirs . . . I have no doubt that sooner or later a Federal Government will take it up, as most other advanced nations have done, as a matter of fiscal necessity and social equity. That is the first explanation of what equity is and that notion of equity is very much the notion of socialist equity. Socialism is hostile to private property and private investment, conditions essential in a community for individuals to have the discretion to make decisions that affect their lives. The assets test has a very direct effect on the economic behaviour of those who are 50-plus, and the superannuation tax has an effect on the economic behaviour of us all. That notion of social equity is very much revealed in this test, and the subject of death duties arises. When Mr Forell says that the simple and equitable alternative to the assets test is to let the elderly enjoy their assets, that is the essence of what the Government is doing. It is saying: 'If your assets are such that your pension would be so reduced that you could not be expected to live on it or you would lose it, we will give you a loan and we will let it accrue'. I wonder what would happen to someone, say, in his late 60s who takes on that loan, with no knowledge of his life expectancy, with that loan and all that goes with loans compounding year by year and with the worry as to whether he will run out of time. In any event, apart from that worry, that loan is a death duty because the Government will claim its interest in that person's assets when he dies. We already have gift duties and the only people in this country who pay it are age pensioners. Part of this assets test includes a tax on gifts made by those receiving the age pension. The tax applies annually on gifts in excess of $2,000 per person so pensioners cannot give their assets away without being penalised by the Government. Mr Acting Deputy President, you and I can give away our assets. We can make gifts to certain close family members with no penalty, but age pensioners will now be penalised. I would love to hear the equity of that situation explained. I utterly reject the argument put by Senator Richardson about the proud history of the Labor Party. In the end that claim and the performance of the Hawke Government are totally hollow. Today we are talking about the elderly. In the next few days we will be talking about families. Some time ago Mr Forell wrote an article that I well remember. He pointed out that the poorest people in our community are those on welfare and with dependent children. Yet this Government has given no attention to those people. There has been no increase in family allowances or in family support. The ACTING DEPUTY PRESIDENT(Senator Collard) —Order! The honourable senator's time has expired. Senator GIETZELT(New South Wales-Minister for Veterans' Affairs)(4.48) —When the Labor Government came to office 18 months ago it was faced with a massive national deficit, massive unemployment and massive inflation, and it set about creating the condition for economic revival. It has reduced the deficit by something like $2.5 billion. Some 250,000 new jobs have been created in Australia and the inflation rate has been halved. In light of that very impressive economic performance we have seen the Opposition parties concentrate on criminality, on Mr Costigan, on High Court judges and the like, seeking desperately to establish an issue on which to fight the coming election. Here today, for the first time for months, we have a bread and butter issue being debated. I want to spend my time defending the Government's decision to establish an assets test in order to have a fair and equitable social welfare system. It is interesting and significant that whilst Messrs Peacock and Messner and some of the other members of the Opposition parties have spoken on this issue, we have had no contribution from previous Ministers for Social Security, Senator Chaney and Senator Dame Margaret Guilfoyle. When we look at a comment made by Sir Phillip Lynch, who was a Treasurer, we can see why former Treasurer Howard has remained silent on this issue. There is clearly an ideological division within the opposition parties on this problem of having a needs-based welfare system. It is true that in 1971, for example, 65 per cent of those eligible for social security pensions received such pensions. In a decade, in 1981, that figure has risen to 87 per cent of persons of pensionable age receiving funds from the Commonwealth Government. We have seen the social welfare budget rise from 28 per cent to 40 per cent in that period. That information comes from figures supplied by the Australian Mutual Provident Society. I want to spend the limited amount of time available to me in showing the duplicity of the Opposition parties. Mr Peacock has said that when he is elected Prime Minister he will abolish the assets test. He has as much chance of being elected Prime Minister as I have of living to the year 2100. He knows as well as I do that he will never be put in the position of implementing that promise. In any case, he is on the public record with respect to social services as saying that there was: . . . a clear duty of government . . . to protect and assist those in genuine need. He made that statement when he retired from the Fraser Government in 1982. Senator Messner has on several occasions discussed the question of the assets test in this place and asked numerous questions of his counterpart, the Minister for Social Security (Senator Grimes). For example, in a statement in the Mercury of 22 February 1982 he is reported to have said: The Minister for Veterans' Affairs, Senator Messner, has warned of conflict between demand for tax cuts and middle class welfare. He said recent surveys suggested Australians wanted social security welfare benefits for everyone, however well-off. Yet apparently oblivious to the massive public cost, they also expected lower taxes, he said. All welfare, whether in aged or repatriation areas, should be based on need . . . That, of course, was his view. It was the view of the Liberal-National Party Government. Senator Chaney was quoted in the Age of 27 August 1982 when he was the Minister for Social Security as having said: I think we cannot escape the fact that there are some genuinely needy pensioners in this country who do not receive enough help, while some other people, by the advantageous arrangement of their assets, are able to draw on the system to a greater extent than their real degree of need would seem to justify. The Young Liberals on 4 July last year also have come on to the public record calling for the means testing of all social welfare payments. It is fairly clear that major divisions of opinion exist within the Opposition parties. That is why Maximilian Walsh, on 7 June this year, wrote an article drawing attention to the damaging articles against Andrew Peacock. He suggested that he had better take up some issues. He took up the assets test, as in recent times he took up the question of criminality, both of which have been proven to be of little consequence to the consciousness of the Australian people. There is no doubt that the Opposition parties, desperate because of the economic revival that has taken place in our country and because of the success of the policies being pursued by the Labor Government, have taken the step of activating in the pensioner groups of Australia a fear concept and complex in an attempt to gain some public support for the policies of the Opposition parties. However, I remind the Senate that in an editorial on only 18 September last, the Australian Pensioner, which is the voice of the pensioner movement of Australia, said: Opposition politicians, certain sections of the media and certain so-called pensioners' representatives have resorted to just about everything in their campaign against the assets test-even to the point of suggesting that a type of social security Gestapo will be created to body-search pensioners and ransack their homes to make sure they are not hiding any valuable assets. Of course, the matter of public importance put forward by Senator Messner criticises the revised pensioner assets test which took into account some of the defects in the original scheme. The editorial in the Australian Pensioner went on to say: So how do those opposed to the proposed test justify their hysterical outpourings? They do it, they say, in the name of pensioners' rights. Well, pensioners do have rights, and the first of those is the right to be told the truth; the right to be informed, not misinformed. If those opposed to the assets test have a legitimate case to put, then let them put it honestly and openly. Don't play on the ignorance, fear and insecurity of this most vulnerable group. Yet that is exactly what the Opposition parties have done over the last year or so. They have failed to appreciate that the Government set out, in its desire to reduce the deficit and establish confidence in the Australian business sector, to create conditions that would lead to the creation of jobs, thereby overcoming the grave difficulties of unemployment benefits. It set out to establish a needs -based welfare system so that those people in the Australian community who require and live solely on the social security payments would have a decent and adequate living standard. This Government has committed itself to raising the pension to 25 per cent of average weekly earnings. It has moved very strongly in the direction of lifting the amount of payment to pensioners to a more acceptable level. It is interesting that the Opposition talks about means testing assets. In all the years it was in government it never concerned itself with lifting the maximum amount of income able to be earned without affecting pension entitlement -$30 for a single person and $50 for a couple. Pensioners on the maximum pension earning the maximum allowable amount of income would still be earning less than $200 a week. Is that adequate? Do the Opposition parties really believe that that is an adequate remuneration for the aged persons in the Australian community? Of course it is an inadequate amount. If the Opposition were genuinely concerned about a decent standard of living for aged persons, it would have taken steps when it was in government-that is 30 of the last 35 years in the post-war period-to raise the income level which has been in operation for many years. What has this Government done? Not only has it assured the great majority of pensioners that they will not be affected, but also it has taken special steps in relation to the way in which the forms have been prepared and to inform the pensioner communities. Its success has been such that the Australian Pensioner editorial has appeared, indicating that the pensioner organisations and their spokespersons, in the wake of the revised assets test legislation, accept the equity of the assets test proposals. What has this Government done in addition to raising the basic living standards of the overwhelming majority of those who are in receipt solely of a pension? We have taken steps in this Budget to provide $4.5m in the immediate sense for aged care persons, to keep people out of institutions and nursing homes, to keep them in their own homes with home help schemes and other geriatric assessment arrangements. All these measures are designed to provide a better living environment for our aged and frail citizens. During the winter recess, I took the opportunity to visit five of the six States. I visited five electorates. I addressed pensioner groups and veterans' groups. As late as last Friday week I addressed a group at Ramsgate of some 60 of the executives of 12 sub-branches of the Returned Services League of Australia about the Government's policy in respect to veterans' affairs. In all of those experiences, I have heard no criticism of the Government's proposals in respect of the assets test legislation. Slowly but surely, the Australian people are coming to accept that the Government's endeavours with the revised pension assets test are fair and equitable. With the home no longer counted, how many pensioner couples do we really believe have assets of $100,000? How many single pensioners, in addition to owning their own home, have $70,000 just lying around in accounts? We know, of course, that that is not Mr and Mrs Average Pensioner. Mr and Mrs Average Pensioner do not have anywhere near the asset maximum that has been placed in the legislation which is the subject of the matter of public importance we are debating this afternoon. The Labor movement has always showed intense concern for disadvantaged people. We are a compassionate party and a compassionate government. It is just ludicrous to suggest that the considerable sum of money that will be saved as a result of steps taken by the Government- between $50m and $100m-will not be used to raise the living standards of the overwhelming majority of those who rely upon government payments to sustain a decent standard of living. I believe that the fears that the Opposition has sought to exploit in respect of this issue will prove to be as much a damp squib as, indeed, have been its endeavours in respect of criminality as it affects the Federal Labor Government. I believe that this debate will prove once again that this Government is pursuing economic policies which are designed to establish the environment for an equitable welfare system based upon need, which even Opposition spokesmen in their more sober moments concede has validity in the way in which any government accepts its fiscal responsibilities. Senator WALTERS(Tasmania)(5.02) —We have heard very little about the assets test from Government senators. Indeed, I believe that they do not like to talk about it much. They spoke about anything but the assets test. They criticised the elderly and complained bitterly about the burden that they are to society. Senator Martin referred to this criticism in some detail. Senator Giles said that age pensioners were making a rort of the age pension. The Minister for Veteran's Affairs, Senator Gietzelt, told us about the tremendous increases in the welfare budget. He did not mention, of course, that the age pension represents only 31 per cent of the total welfare bill. He talked about the tremendous increases in the welfare budget and used this as an excuse for the Government's attack upon the elderly. We are debating a matter of public importance regarding Mr Hawke's assets test and the Government's attack of aged Australians. As I said, the age pension represents 31 per cent of the welfare bill. Expenditure on the elderly between June 1979 and June 1984 increased by 7 per cent. In the same period expenditure on the supporting parents benefit increased by 146 per cent, the unemployment benefit by 109 per cent and sickness benefits by 41 per cent. As I said, the increase for the elderly was 7 per cent. Yet, Senator Gietzelt talks about the tremendous increase in the welfare budget being the cause for the Government introducing the assets test. Senator Richardson, of course, said that he was responsible largely for excluding the home from the test. We on this side of the chamber were led to believe that the Minister for Social Security, Senator Grimes, had something to do with that. Senator Gietzelt claimed that he helped a little. Each honourable senator on the other side is saying: 'Look, I did not like the first assets test that Senator Grimes put up, but I was primarily responsible for the decision to exclude the home'. This is what they were saying . Each jumped quickly and said: 'I was the prime mover-I take credit for it'. What a tremendous insult that is to the people of Australia. Let us have a look at the cost of this new assets test. The Government has admitted now that it has already spent $24.7m on setting up the assets test and it intends to spend another $30m. So nearly $55m is involved in setting up the test Indeed, we will be paying this immense amount in the first two years following the Government's first suggestion of an assets test. Eventually what amount will the assets test bring in? It will not bring in as much as it costs the taxpayer to set up the scheme. The Government says that the scheme will bring in $45m. The fact that it will cost nearly $55m is quite beside the point as far as the Government is concerned. What is the assets test all about? According to Senator Gietzelt, Senator Richardson and Senator Giles, it is to get the wealthy, the tall poppies, in the community. I will give an example of the people it will get. A woman came into my office the other day and said: 'It is just not fair, Senator. My husband and I did not go on overseas trips. We did not take the luxury trips that some of our fellow pensioners took. We saved and with the money we saved we bought a holiday home for us and the kids to enjoy for the rest of our lives'. What is going to happen to that couple? What is going to happen to that woman when she is a single pensioner? She will be forced either to sell her holiday home or go into debt with the Government. Senator Gietzelt asked: How many pensioners will have $70,000 worth of assets? What was so deceitful was his remark that those assets were just lying around in accounts. What single pensioner would have $70,000 just lying around in accounts ? Senator Gietzelt knows that is untrue and every pensioner in the community knows it is untrue. An amount of $70,000 does not have to be lying around in accounts. The only asset that is excluded is the home. When the value of the contents of a home, a holiday shack or holiday home and a car are added together , the sum can easily come to over $70,000. What woman would consider her engagement ring, bought for her perhaps 70 years ago by her husband, an asset? Not many. I would never have considered my engagement ring or other jewellery my husband bought me an asset. This Government considers those items an asset. Senator Grimes —That is a lie. Senator WALTERS —All personal effects will be considered an asset. The DEPUTY PRESIDENT —Order! Senator Grimes, you will withdraw that remark. Senator Grimes —I said: 'That is a lie'. I did not say she was a liar, although she is. The DEPUTY PRESIDENT —Senator Grimes, you will withdraw that. You will have a chance to rebut the claim when you speak in this debate. Senator WALTERS —Mr Deputy President- The DEPUTY PRESIDENT —Order! Senator Grimes must withdraw those words. Senator Grimes —I withdraw. You are of the same standard as your friend Hodgman. Senator WALTERS —Mr Deputy President, the papers that Senator Grimes's office handed out to me do not mention that personal jewellery is exempt. There is no mention that personal jewellery is exempt. Because it is not exempt, of course, it is included. We have been told by this man opposite us that pensioners do not have to fill in the form if they think their assets do not amount to $70,000. Many pensioners will not fill in the forms which are sent to them because they will not take their very personal effects into account. According to the document sent out to them, these items should be included. Because they will not fill in the form accurately they will then be subject to penalties. According to the document that Senator Grimes has given to us, they will be subject to a penalty of $2,000 if they do not fill it in correctly. If Senator Grimes queries the fact that jewellery is not included, I refer to the document, which provides for, 'the value of household contents and personal effects' to be stated. If my personal effects do not include my clothing, the jewellery I wear, or anything else, Senator Grimes had better make that clear and make it clear now, because it will enable every pensioner or every person in Australia approaching pension age to put their money into jewellery. If they put their money into jewellery, they will have those assets to leave to their children. If Senator Grimes is saying that I am not telling the truth by including jewellery as an asset I will finish my remarks early to enable him to say so. I am not frightened of his attacks on me. He has attacked me in this Parliament on every occasion possible. If he is not prepared now to say to the Senate that jewellery is excluded from the assets test-because that is what I am saying; he tells me I am not telling the truth-everything he has claimed by way of interjection is a complete untruth . I will close my remarks now to enable Senator Grimes to tell the people of Australia something that nobody else is aware of-that all the personal effects are not included, that jewellery is exempt, and that people of Australia who are approaching pension age can convert all their money and all their other assets to jewellery, so the jewellery can then be left to their children and the assets that the Government is taking from them will be able to be bequeathed in their wills to their relatives. Senator GRIMES(Tasmania-Minister for Social Security)(5.12) —I thank Senator Walters for giving me this bonus of a couple of extra minutes. I will deal with the last point that Senator Walters made in a moment. The speech that she has just made is typical of her behaviour since any suggestion of an assets test came up. But some things in her speech were even more typical. As I entered the chamber Senator Walters was saying that Senator Richardson, Senator Grimes and Senator Gietzelt- Senator Walters —No, I did not mention you. You had not spoken. I said 'Giles'. Senator GRIMES —She was saying that Senator Richardson, Senator Giles and Senator Gietzelt all claimed that they had something to do with the exclusion of the family home from this assets test as distinct from the first assets test that was introduced in this place. That is the sort of typical nonsense we have had. The two versions of the assets test which have been proposed by me and by this Government have excluded the family home. This Government has never intended, and never said that it would intend, to include the family home in an assets test. Senator Walters knows it and has always known it. Yet since the whole thing started she has tried to put the fear of God into pensioners in this country by saying to them that the assets test includes the family home. That is what I meant when I talked about lies. Let me talk about her second lie. Let me talk about the elderly person in Tasmania who went to Senator Walters's office before the first assets test was introduced. She told the person that he had better go away and sell up his assets. She said: 'You had better go and do that because if you do not, Senator Grimes and that nasty government will take them away'. That was a lie. Senator Walters, by that sort of behaviour and misrepresentation-along with her close colleague and personal friend, the honourable member for Denison, Mr Hodgman- goes around repeating the lie that gold in people's teeth will be included in the assets test, and never denies it. It is that sort of behaviour which frightens pensioners. It is that sort of behaviour which I think is beneath a member of this Parliament and should not occur. It is that sort of behaviour which makes a sensible debate on this issue impossible. Senator Walters said that I should say in this place that pensioners will be able to convert all their assets to jewellery, that all of that jewellery will be excluded and therefore they would be able to leave it to their children. Of course, they cannot do that. I have never suggested by way of interjection or in any other way that they could do that. Senator Walters —Oh, you fraud. Senator GRIMES —I have never said that. I find it interesting that Senator Walters is advocating that that should happen because that was one of the criticisms of the first assets test that she, Senator Messner and others complained about. Now under the present assets test she says that people ought to be able to convert all their money and assets into jewellery so they can leave it to their children. They cannot do that by using that artificial device; of course, they cannot do that. That would give them a collection of expensive jewellery. To allow people to evade an assets test, an income test or anything else like that is not fair. I have only a few moments left in this debate, so I will say a couple of things as briefly and succinctly as I can. It is simply not fair that if we have a needs-based social security system-and everyone on both sides of the House claims that we should have a needs-based social security system-that those needs are measured only in income and that assets are excluded. We said that in 1976 and we say it now. Senator Messner —Well, why didn't you say it in your Labor essays? Senator GRIMES —We said it in 1976 and we say it now. I said in 1976 that if assets are excluded in the way in which they were, artificial schemes would be created. When those artificial schemes are created, large numbers of people will avoid the income test to the disadvantage of their brothers and sisters who are in receipt of small weekly superannuation payments, small fixed incomes, who get small amounts of interest from the bank or who, like the vast majority of pensioners in this country, rely on the base rate of pension. Any government, be it Labor or conservative, will be limited in the capacity in which it can increase pensions if that inequity continues to exist and large amounts of money are leeched out of the system in that way. We looked, as did others, at all sorts of methods. We speculated, like Senator Chaney, the Leader of the Opposition, Mr Peacock, and others have done over the years, as to how to overcome this system. We decided, like many members of the conservative parties, that the only thing to do was to incorporate those assets in the means test- something which previous Liberal and National Party Ministers for social security matters had administered for years without any difficulty and without any hassle. Senator Messner —That is why they got rid of it. Senator GRIMES —They only got rid of it because of pressure from the National Party, and Senator Messner knows it. Even Senator Messner, when he was Minister for Veterans' Affairs, dearly wanted to introduce it and he knows that that is true, too. Since it was introduced there has been a whole series of misrepresentations and people, even amongst pensioner organisations, are getting fed up with those misrepresentations of the assets test. They are getting fed up with the sort of lies and deceptions which are being perpetrated by the likes of Senator Walters. I remind honourable senators of the editorial which appeared in the Australian Pensioner which stated: Opposition politicians, certain sectors of the media and certain so called pensioners' representatives have resorted to just about everything in their campaign against the assets test-even to the to point of suggesting that a type of social security Gestapo will be created to body-search pensioners and ransack their homes to make sure they are not hiding any valuable assets. I interpolate to say that is not so. Senator Messner knows it is not so and Senator Walters knows that it is not so. But they will still try to perpetuate those myths. The editorial continued: If those opposed to the assets test have a legitimate case to put, then let them put it honestly and openly. Don't play on the ignorance, fear and insecurity of this most vulnerable group. Today in the Age Claude Forell said, and put it very well: The hysterical froth of fear and loathing whipped up against the Federal Government's assets test on pensions has been wondrous to behold. The campaign has been waged not so much by those with a genuine concern for the poor and needy but the politicians eager to garner votes and by a newspaper anxious to win readers. It is that base motive, that cynical motive, which has driven the sorts of deceptions that we have heard in this place in the five or six matters of public importance on this subject and in the four or five matters of public importance brought up by Mr Peacock in the other place. It is with this base motive, this desire to stir up the fear and ignorance that may exist among some pensioner groups, that the Opposition is carrying on in this way. In none of the long and repeated debates in this place have we had any concrete suggestions from Senator Walters, Senator Messner, Senator Martin or Senator Sir John Carrick who have been the main bit players in this. All we have heard is: 'All you have to do is wait for the Senate Standing Committee on Social Welfare to come down with its report. All the answers will be there. Do not do anything until that report comes down. You will not have to do any policy development because it will all be in that report'. I have been in this place a long time and I have seen many Senate committee reports. None of them has come down with the answers of that type. We have had all the information and for many years we have had endless reports on retirement incomes, taxation and national superannuation in this country. What was needed was a government that had the political will to do something, knowing that when it did something it would be attacked in the most dishonest way that this Government has been attacked. But despite the nonsense and the fuss that we have in this place almost every week when such an MPI is brought down, I ask Senator Messner and Senator Walters to go away and look at what the people of Australia say in the public opinion polls. They should look at what the people say about their Leader, who has made such an issue of this, who almost every week, when he is not going on about the latest little issue that he has been going on about, has been running the equivalent of an MPI on the assets test. They should look at what the people of Australia think of him, his tactics and his policies. Maybe then they will go away and think what the people of Australia want. What they want is a government that is willing to take steps to remove inequities in the system, willing to take steps to improve the system in the future. The simple facts are these: This is a very generous assets test. Pensioners who own their own homes will not be affected until, if they are single, they have $ 70,000 worth of assets, and if they are married, $100,000 worth of assets. To each of those sums can be added $50,000 if they do not own their own homes. In those circumstances the vast majority of pensioners in this country will be excluded because that majority, if they own their own homes, have only a few bob in the bank after that. People will not be going into pensioners' homes looking at their wedding rings, their dresses or their personal effects. Senator Walters knows that. People will not be going around putting on computer lists of people' s personal effects, as Senator Boswell and Senator Messner have suggested in recent times. They know that. The pensioners of this country know it. Quite frankly, I suggest to the Opposition that until it can come up with a viable alternative proposal and a viable alternative policy it should stop boring us every Tuesday, Wednesday or Thursday that this Parliament sits by repeating this MPI with different wording. Opposition senators must do it only to hear their own voices because the words they use never change and the speeches never change. It must be just to hear their own voices that they carry on in this way. The DEPUTY PRESIDENT —The time allotted for this debate has expired. Senator WALTERS(Tasmania)(5.24) —Mr Deputy President, I seek leave to make a personal explanation as I believe I have been misrepresented. Leave granted. The DEPUTY PRESIDENT —The honourable senator may proceed, but only on the matter of misrepresentation. Senator WALTERS —Of course. Today the Minister for Social Security, Senator Grimes, has forgotten that the Senate's proceedings are being broadcast. It is no use trying, as he has today, to slither out from- The DEPUTY PRESIDENT —Senator Walters, you must confine your remarks to where you have been misrepresented. Senator WALTERS —I am, particularly to what Senator Grimes said. It is no use trying to slither out from under from what he interjected and what I took up while I was speaking. Senator Grimes tries this so often. The DEPUTY PRESIDENT —Senator Walters, you must explain just where you have been misrepresented. Senator WALTERS —What I was saying when he interjected was that women have never viewed their engagement rings as assets, as they must now be. I have never considered my engagement ring as an asset, nor have I ever considered and nor do women consider their personal jewellery that their husbands have given them as assets. They do not look upon those as part of their personal effects. Senator Grimes said: 'Lies'. The DEPUTY PRESIDENT —Order, Senator Walters! You are only entitled to make an explanation of misrepresentation of something said in debate. Interjections do not qualify under this heading. I ask you not to go on too long on this aspect. Senator WALTERS —I enabled Senator Grimes to enter the debate. He said 'lies' and he was asked to withdraw. It was because he said 'lies' after I said that engagement rings are included as assets that I believe I have been misrepresented. I sat down and gave him time to say to the people of Australia that engagement rings were not included. However he claimed that it was not engagement rings but other things that he was talking about. Senator Grimes —I did not say that at all. Senator WALTERS —Hansard will report that he said 'lies' when I was talking about engagement rings. In addition, he accused me of saying to people who come into my office: 'Sell up your assets'. He accused me of going around Tasmania telling pensioners to sell up their assets. I have never told people or vaguely suggested to people that they sell up their assets. Indeed there is a great deal of penalty in doing so. I would never tell anyone to sell up his or her assets because I do not believe this Government will be in power long enough to enforce its assets test. That is the last thing I would do. Yet this man has misrepresented me in the most vile fashion by saying that I go around Tasmania advising pensioners to do something that would be completely in opposition to their best interests. I refute everything that that man ever says about me in this place. He always tries through intimidation to stop me from speaking. The DEPUTY PRESIDENT —Order, Senator Walters! I think that is a fair explanation of the misrepresentation. Senator GRIMES(Tasmania-Minister for Social Security) —Mr Deputy President, I seek leave to make a personal explanation as I claim to have been misrepresented by Senator Walters. Leave granted. Senator GRIMES —Hansard will show that Senator Walters said: 'I am sitting down early so that Senator Grimes can get up and explain, if he believes it, that people can put all their money into jewellery and that therefore it will not be counted as personal effects and they can leave them for their children'. Hansard will show that. I will not go on with it. That is what she said. We will certainly not send inspectors in to value people's engagement rings. She knows that. As to the second matter she raised, I quite specifically said, when the previous assets test was proposed, that at least one or two couples had claimed that they went into Senator Walters's office and were told that the best thing they could do was to sell up their assets because if Senator Grimes and his Government got hold of them they would be counted in and they would lose their pensions. Senator Walters —What verification have you got for that? Senator GRIMES —Senator Walters should wait a minute. We wanted verification of it. What we did was to get someone to ring Senator Walters's office to see whether that was the sort of advice that she was giving. That is what happened. Senator Walters —You are not telling the truth. Senator GRIMES —Senator Walters knows that that is true. She knows the sorts of things she was saying. I suggest that she ask some of her colleagues what she was saying. Maybe she does not know what she was saying at the time. It was the same in the debate this afternoon. Senator Messner —Mr Deputy President, I raise a point of order. I do not think beyond any shadow of doubt it can be said that Senator Grimes is not debating the issue. He is certainly not making any kind of personal explanation. All he is doing is arguing the point about what facts were or were not in the matter that Senator Walters raised. For that reason I ask you to rule him out of order. The DEPUTY PRESIDENT —There is a danger of these personal explanations turning into debate. I was fairly lenient with Senator Walters. I am extending the same level of leniency to Senator Grimes. I ask him to keep it in the level of where he has been misrepresented. Senator GRIMES —Mr Deputy President, I just say in passing that I agree with you entirely. I think the number of personal explanations that are being made in this place, in an effort to answer debating points, is ludicrous. With due respect, it is only a recent phenomenon since the present Opposition has been in opposition. I make one final point. Hansard will also show that Senator Walters said this afternoon that Senator Richardson, Senator Gietzelt and, she now says, Senator Giles were taking credit for removing the family home from the latest assets test, whereas it was in the first assets test. I point out that the family home has never been included in any assets test proposed by me or the present Government. If Senator Walters is that confused, it demonstrates how she can be confused in other areas. Senator WALTERS(Tasmania) —Mr Deputy President, I claim that the Minister for Social Security (Senator Grimes) has again misrepresented me and I seek leave to make a personal explanation. Leave granted. The DEPUTY PRESIDENT —Senator Walters, before you speak I inform you that I do not want this to continue into an indefinite debate. It will have to be strictly on the narrow issues of misrepresentation. Senator WALTERS —Mr Deputy President, I understand that but I will not allow Senator Grimes to say in here that he arranged for someone to ring my office, and that the advice coming out of my office was that pensioners should sell up their assets. That is completely untrue. No one has ever rung my office and been given that advice by either my staff or me. I will guarantee the Senate that. I ask Senator Grimes to give the name of the person whom he asked to ring my office and who got that information so that we may have the matter cleaned up as to who is telling the truth, Senator Grimes or me. I will not have my integrity or the integrity of my staff besmirched by Senator Grimes who in this place continually attempts to besmirch the integrity of honourable senators on this side. Senator MESSNER(South Australia) —I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator Dame MARGARET GUILFOYLE(Victoria)(5.34) —I move: That the Senate take note of the paper. We have an interesting paper before us, together with the statement of the Minister for Finance (Mr Dawkins). The paper outlines the program presentation of appropriations and outlays for departmental estimates for 1984-85. Its intention is to assist Parliament and the general public in their examination of the 1984-85 figures in the Budget Estimates. This paper presents a reconciliation between appropriations in the Consolidated Revenue Fund and outlays that actually occur. This is the second time that it has been published, as it was published for the first time last year. I believe it is of assistance, in the manner in which it has been described to be, in that it does present functional classifications of outlays in 18 or more major categories. The Minister mentioned in his statement a pilot study to explore implementation of program budgeting. As I anticipated, the report of that pilot study is expected shortly, and I look forward to its reaction on the matter of the implementation of program budgeting. Another matter that is of interest in the papers before us is the financial management improvements program and the way in which the Department of Communications, the Department of Health and the Department of Immigration and Ethnic Affairs are assisting in developing guidelines for that program. All of these matters lead to greater accountability in Public Service management and in public expenditure. I was interested to see them and I feel sure that they will be of interest in the wider community. Question resolved in the affirmative. Senator MESSNER(South Australia) —I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator MESSNER(South Australia)(5.38) —I move: That the Senate take note of the papers. We do not have the advantage of having this paper before us for discussion here today, but I did want to ensure that the matter came up on the Notice Paper since it is an important paper, no doubt paying a lot of attention to the state of play with Social Security Appeals Tribunals. This is a matter which from time to time causes a great deal of concern in the community and certainly a great deal of concern as to the length or otherwise of delays in processing appeals through the Tribunal's system. While I was Minister for Veterans' Affairs I had a great deal of interest in the way in which the repatriation system operates. We have since seen legislation on that matter introduced by the Minister for Veterans' Affairs (Senator Gietzelt) as a result of reports brought down on former occasions. I believe that as a matter of general policy there is a very real need to examine the Tribunal's system and the social security appeals system. I think the Government could well be advised to implement a total review of the procedures of the tribunal system as it operates at present. Nevertheless , we look forward to the report so we can examine it closely with a view to discussing the matter at some later time. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator SCOTT(New South Wales-Leader of the National Party of Australia)(5.39) —I move: That the Senate take note of the paper. I notice that the 1983-84 annual report of the Repatriation Commission describes the year as a year of review, and indeed so it has been. The review stems basically from the reports of committees and councils which had been sought by the previous Government and which fortunately, I believe, have been followed and in large measure to this point, implemented by the current Government. Those changes cover a very important field. Probably the most important section refers to the new system of pension determination which evolved through the Bill which passed through this Parliament towards the end of last session. It is quite a radical change, designed to meet circumstances which were becoming totally unacceptable-delays in this area were so great and so many that the position was rapidly deteriorating. The alteration, which seeks to establish 75 initial determining individuals, should in the course of time-beginning hopefully early next year-significantly alleviate the problems of delay in the area of the Repatriation Commission involvement. Those delays were caused by a number of factors, such as the impact of certain judicial interpretations. To a degree they were caused by staffing problems and perhaps the need for more sophisticated technological equipment. Of course the clear and obvious reason was the continuing increase in the number of people in Australia who were approaching and passing the age of 60 and therefore becoming involved in the pension area. The report also mentions the preparation of the Entitlements Bill, which will be a large piece of legislation. It seeks to rationalise the Repatriation Act, 1920. It has an enormous task and the Opposition will observe the progress in that field, which I hope will be rapid because it covers an immense number of important areas. The Entitlements Bill will make reference to the onus of proof and a whole range of matters that are of particular concern to the ex-servicemen and women of this country. I am sure that that Bill needs to be hastened on its way and needs to be observed very carefully by both the Government and the Opposition alike and indeed by the whole cross section of the ex-service community. I close by saying that the repatriation hospitals are regrettably, in many senses, almost overloaded but their need for development continues. It is an interesting observation that the alleged alternative of Medicare has not seen great numbers of people moving towards care under the Medicare system in the public hospitals. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator CROWLEY(South Australia)(5.46) —by leave-I move: That the Senate take note of the paper. This paper addresses the Commonwealth Department of Sport, Recreation and Tourism and recommendations in this area. I take this opportunity to make a few remarks about this matter and explain why I have a particular interest in it. The report made a number of recommendations to be taken up in this portfolio area and the Minister for Sport, Recreation and Tourism (Mr John Brown), in tabling the Government's response to that report, was pleased to note that the recommendations largely confirmed this Government's priorities in the area of sports and recreation-that is, that there should be much wider participation. While there is continuing support for high performance sport, there is also support and effort to provide leadership, innovation and research to facilitate the participation in sport and recreation of the Australian community as a whole . The Government in many areas of its portfolio areas has supported the notion of community participation and development and of course this fits very well within the portfolio area of sports and recreation. The reason the Government argues this is not only because of the notion of equity and participation by the community but also because fit and healthy people contribute to the general well being of the Australian community and sports and recreation allow people to become fit or to enjoy getting fit. At least most of us enjoy that exercise-I know that some people complain about it. On the whole sport and recreation is a matter of enjoyment for Australians, and while the Government appreciates the importance of promoting excellence and world success in all our sporting facilities, it also addresses the aspect of broad participation. In this report it also addresses the specific needs of certain groups in the community, in particular Aborigines and the disabled. Although our Aboriginal community is not perhaps sufficiently represented in sports and recreation, our disabled people are increasingly more represented. It was not so long ago that Australians featured so successfully and splendidly in the recent Paraolympic Games. I will speak of that later. Another reason I wish to talk to this paper is because of another Government initiative. I have recently been appointed convenor of a working party for the Women in Sport Committee. The main aims of this Committee are to look at increasing the participation of women in sport and in particular to look at ways in which the participation of women in sport is not only promoted, but also recognised by the media. It was quite clear to the Committee, even after its first meeting, that media coverage of women in sport is insufficient to say the least. A survey done in 1981 of the major Australian daily newspapers' sporting coverage for a week, which was fairly exactly examined and measured in column inches, showed that 2 per cent of their sporting coverage was devoted to women's sport. We feel that that is insufficient; in fact, if I were given to legal phrases I would say that our case rests. In the light of that sort of evidence we intend to take steps and make proposals and recommendations to improve the situation. I have an excellent committee working with me and one of its members is Elizabeth Kosmala. I mention her in particular because of my previous comments about the Parolympic Games. Elizabeth Kosmala has recently returned from those Games where she gained four gold medals in shooting events. These were the World Parolympic Games and Elizabeth was not the only representative or gold medallist from Australia at those Games. I do not only commend people who get gold medals as, I think the significant thing in world games is for any Australian to reach the standard that allows him or her to qualify to represent this country overseas. I am very pleased that the working committee on Women in Sport is underway. Our report should be tabled by the end of April. We hope to consult broadly with women's groups, media groups, radio, newspapers and television, as well as magazines around Australia. We hope to talk with groups in all States and we hope to receive a wide range of submissions from anyone with an interest in this area. Question resolved in the affirmative. Senator TATE(Tasmania) —I present the tenth report of the Standing Committee for the Scrutiny of Bills concerning the Bank Account Debits Tax Administration Amendment Bill 1984, the Bounty (Agricultural Tractors) Amendment Bill 1984, the Bounty (Tractor Cabs) Amendment Bill 1984, the Bounty (Computers) Bill 1984, the Bounty (Electric Motors) Bill 1984 and the Income Tax Assessment Amendment Bill (No. 2) 1984. I also lay on the table Scrutiny of Bills Alert Digest No. 12, dated 3 October 1984. Ordered that the report be printed. Senator REID(Australian Capital Territory) —On behalf of the Joint Committee on the Australian Capital Territory I present the Seventy-eighth Series, third report, and Eighty-third Series, first report, on proposals for variations of the plan of layout of the City of Canberra and its environs. I also table extracts from the Committee's minutes of proceedings, and I seek leave to make a statement relating to the reports. Leave granted. Senator REID —The first report I have tabled on the Seventy-eighth Series of Variations reports on traffic problems in Deakin and Forrest, a matter that has been before the Committee for approximately two years awaiting a solution from the authorities involved. It was the previous Committee which first looked at these problems when making its first report on the Seventy-eighth Series in October 1982. That Committee approved an extension to Melbourne Avenue as part of the access road system to the new Parliament House. It is in relation to access to the new Parliament House that this report is significant. However, the Committee made it a condition of approval that a workable system be produced to deter through traffic from the north from using the parliamentary perimeter roads and Melbourne Avenue as an alternative route to the south, exacerbating long-standing traffic problems in Deakin and Forrest. The traffic problems in Deakin and Forrest have been of tremendous concern to local residents. During its consideration of these problems the Committee has received many submissions from residents asking the Committee to ensure that a solution be found to the problems. In addition to the many individual submissions, two petitions were presented to the Chairman in July 1983 and February 1984, signed by 183 and 165 residents respectively, asking the Committee to ensure the reduction on traffic on this unintended alternative through route to the south. The Committee was aware that a solution acceptable in total to all residents could not be found, because of the conflict in views of residents. However, the Committee believed there was a commonly shared problem to which a solution acceptable to most residents could be found. Joint Committee on the ACT Joint Committee on the ACT In October 1982 the National Capital Development Commission undertook to provide a workable solution to this problem by the next variation hearing. However, no proposed solution was presented to the Committee until October 1983, despite the establishment of a joint task force consisting of officers of the Commission, the Department of Territories and Local Government and the Australian Federal Police to find a solution, and despite the expressions of concern by the Committee that no solution had been put to it. When the NCDC's proposal was considered by the Committee in December 1983 it was clear that it was not acceptable to both the NCDC and the Department, nor was it acceptable to most residents in the area. The NCDC asked the Department to accept responsibility for pursuing the necessary consultation and developing a workable solution to the problem. The Department, following further study, developed a proposal which it believed would assist in preventing the growth of through traffic in Deakin and Forrest, a brochure incorporating a questionnaire on the proposed solution was sent to householders in the area and the Department conducted a shopfront for a period of a week to explain its proposal and obtain public response. Some minor modifications were made to the proposal as a result, but the majority of respondents to the questionnaire and those who attended the shopfront supported the proposal. The Department then put its proposals to the Committee. The proposals involved two elements. Firstly, traffic arrangements were proposed at the intersection of State Circle and Melbourne Avenue which would prevent cross-movement between the new Parliament House and Melbourne Avenue. This measure was designed to ensure that there was not a tremendous growth in Melbourne Avenue traffic as a result of traffic generated by the new Parliament House. Secondly, the Department proposed a series of roundabouts in Deakin, Forrest and Red Hill residential streets to reduce the overall speed of traffic to improve road safety and to deter through traffic from using these residential streets. The Committee supports the Department's proposals as an acceptable solution to a difficult problem. The Department's proposal to prevent direct access from Melbourne Avenue to the new Parliament House is essential to minimise the through traffic using Melbourne Avenue and residential streets further south in Deakin and Forrest. The proposals for a series of roundabouts must be considered as working effectively to deter traffic and reduce speeds only if implemented as an integrated package of measures and the Committee supports them as such. While these proposals may not significantly reduce the existing traffic in Deakin and Forrest, they will assist in reducing the growth of traffic, reducing the speed of traffic and improving road safety. There is public support for, and expectation of, the implementation of the proposals in total. Apart from the particular problems with the design of the Melbourne Avenue- State Circle intersection and the cost of the Kent Street-Carruthers Street roundabout which are discussed in detail in the report, the Committee recommends that the Department's proposals be implemented as an integrated package. While realistically the proposals can only be implemented progressively because of budgetary considerations, the Committee wishes to see the entire package implemented by the end of the 1985-86 financial year. The measures will only be fully effective once they have all been implemented. The Melbourne Avenue-State Circle intersection proposal, which will involve little cost, should be implemented as soon as the design problems can be overcome. The second report I have tabled reports on eight items in the Eighty-third Series of Variations which the Minister for Territories and Local Government (Mr Uren) has indicated to the Committee have priority. There were no public objections to any of these proposals. A number of these items to which the Committee has given priority are part of the land development program which is attempting to overcome the problem of a shortage of land and housing in Canberra . Variation No. 1 in Florey is particularly important in this regard as part of the development of Florey will be undertaken by the Housing Industry Association with the aim of providing house and land packages for low and middle income earners. This involvement enables the acceleration of land servicing and the construction of housing. The development in Florey will be subject to detailed guidelines which will ensure that standards of land development and housing construction which apply elsewhere in Canberra are met. The NCDC will make regular inspections to ensure that the standards as set out in the deed of land development are met. The Committee approves this variation and the other seven variations which are included in this report. The Committee hopes to consider the other variations in the Eighty-third Series, including those to which there were objections, as soon as possible. Senator GARETH EVANS(Victoria-Attorney-General)(5.59) —I present the final report of the Joint Select Committee on Parliamentary Privilege, together with minutes and a letter of advice from the Secretary of my Department to Mr Spender , the Chairman of the Committee. I seek leave to move that the Senate take note of the report. Leave granted. Senator GARETH EVANS —I move: That the Senate take note of the report. This is a long and important report which has been two and a half years in the making, during the last Parliament and this. It is a systematic and comprehensive review for the first time in the history of the Commonwealth Parliament of the whole law and practice of privilege. It comes forward with a series of recommendations for change, most of them unanimous-certainly none of them the product of a vote on party lines-which recommendations are proposed to be implemented partly by statute, partly by amendments to the Standing Orders of the respective Houses and partly by resolutions of the respective Houses. Most of our recommendations were set out in the exposure draft report which was tabled in June and they have had the benefit of a number of very useful comments by senators, members and others. I seek leave to incorporate a document which sets out briefly the principal recommendations as they appear in the final report. Leave granted. The document read as follows- PENAL JURISDICTION That the penal jurisdiction be retained in the Parliament itself. There have been a number of suggestions that the capacity to deal with breaches of privilege and contempts should be transferred to the courts or some other tribunal. However, after careful consideration the Committee believes that the arguments in favour of retaining the exercise of the penal jurisdiction within Parliament outweigh those in favour of transfer; That the penal jurisdiction should be exercised as sparingly as possible and only when necessary to prevent substantial interference with the work of the Parliament, i.e. it should never be exercised in connection with complaints of a trivial character; That with one major exception there be no substantive change in the law concerning contempt, but that the Houses adopt a set of guidelines which will indicate those matters which may be regarded as contempts. This action would serve to advise the community of Parliament's thinking but would not result in Parliament losing its capacity to take action against matters which may not fall under any particular headings; The exception is that the capacity for Parliament to take action against a person for what is known as a defamatory contempt should be abolished, or failing that, defences, including that of truth, or an honest or reasonable belief in the truth of the statement, should be available. TREATMENT OF COMPLAINTS That complaints should be raised in writing with the Presiding Officer, instead of the present early public raising, with the Presiding Officer subsequently giving a decision in his House if a matter was to be accorded precedence; That hearings of the Privileges Committees, and the rights of parties involved in inquiries, should be reconstituted to meet requirements of natural justice, in particular, that there should be a right to full legal representation; That the Houses should, by statute, be given the powers to commit to prison for a period not exceeding 6 months and to impose fines; That, where it is proposed that a penalty be imposed, 7 days notice be required ; That the power to expel Members be abolished; That where a person is committed, the resolution and the warrant should each state the grounds of the commitment, thus permitting a very limited involvement by the High Court which would ascertain whether there was, in fact, such a ground. PROCEEDINGS IN PARLIAMENT That, for a trial period, there be a limited right of reply to non-Members who believe that they have been subjected to unfair or groundless attack in Parliament. The proposal is that such persons could refer complaints to the Privileges Committee of the relevant House. There would be certain ground rules, for example, that the complaints should be confined to factual answer and not contain an attack on the Member involved. The Committee would be able to recommend that the rebuttal be incorporated in some form in the parliamentary record; An expanded definition of proceedings in Parliament; That the laws of qualified privilege as they apply to reports of proceedings of the Parliament be modified to produce uniformity throughout Australia in the publication of fair and accurate reports of proceedings; That the practice of requiring leave to be granted for reference to be made to parliamentary records (usually Hansard) in court proceedings and before Royal Commissions and other specified tribunals be abandoned and that, for the limited purpose only of enabling it to be proved as a fact that certain statements had been made, permission be given for reference to be made without leave, without in any way permitting Article 9 of the Bill of Rights to be infringed. PARLIAMENTARY COMMITTEES That Parliament enact a Witnesses Protection Act, which would make it a statutory offence to threaten, punish or injure, or attempt to do so, a person on account of evidence given or to be given before a parliamentary committee. Witnesses would also be given a right to initiate civil proceedings for damages; That a detailed series of guidelines for the conduct of ordinary committee (i.e . non-privilege) inquiries be adopted. Other recommendations include modifications in respect to the immunity from attendance as a witness, and the immunity from civil arrest. Senator GARETH EVANS —If there is any single theme running through the report it is that parliament should never take itself in its own role so seriously that the rights and liberties of others are threatened in the process. It is important that parliamentarians retain an unfettered right of free speech and that they be completely unhindered in the exercise of their public duties, but it is not right that in the guise of protecting these privileges there should be severe limits imposed on the capacity of others to express views about parliament and parliamentarians. It is not right that there should be a capacity within parliament to injure reputations carelessly and indefensibly without any form of redress or at least a reply being available. It is not right that when defending rights and privileges, parliament and parliamentarians should be able to run kangaroo courts wholly indifferent to the principles of natural justice. I believe probably the most important of all the recommendations in the report are those dealing with so-called defamatory contempts on which recommendation the Committee was divided, but where the majority view was that the right of parliament to punish people for defaming the institution or members of it should be wholly abolished. I refer in this respect to what I said in the Senate on 29 April 1982 when the Committee was first being established. I made particular reference in the course of those remarks to the Laurie Oakes privilege proceedings, the conduct of which by the House of Representatives was, I believed then and I believe now, something that did more to bring parliament and parliamentarians into disrepute than anything that occurred in the now notorious article that was the subject of those proceedings. What I said on that occasion was this: . . . we have tended to lose our way, to lose our sense of bearing in dealing with privilege matters, particularly insofar as we have continued to treat as actionable breaches of privilege actions or statements, which merely offend our dignity or are perceived to affect our reputations, which can be regarded as defamatory in some way but which do not interfere with or obstruct in any meaningful fashion, any understandable fashion, the operations of Parliament itself. Later on I said: I believe that the content of breach of privilege should be completely redefined so that anything that really does obstruct or interfere with the proper working of Parliament, such as bribery, corruption or physical interference, is briskly and severely dealt with while anything that merely offends our dignity, whether individually or collectively, or pricks our self- importance in some way is outside its scope. I believe that in our final report we have gone some way down this particular path as well as, of course, quite a number of other paths. In the process we have shown the way for action to be taken which will give some real weight in practice to the values of free speech in respect of individuals about which we constantly talk in terms of principle. Finally, I pay tribute to the work put into the production of this report by a great number of people, in particular a number of parliamentary officers led very ably by the Secretary to the Committee, Mr Bernard Wright, and by members of the Committee themselves, most of whom served the Committee over the whole two-and-a-half-year period of its existence. I believe the person deserving the most credit for bringing the report to fruition in its final form is the Chairman of the Committee, Mr John Spender, QC, the member for North Sydney who with, it must be said, the active consent of the Government retained his position as Chairman notwithstanding the change of Government in March 1983. John Spender and I have quite profound personal and political differences on almost every conceivable subject, but on the question of privilege we have been, as Chairman and Deputy Chairman of the Committee respectively, of very similar mind, much to the alarm of Senator Peter Rae-not to mention Senator Jessop- throughout the whole exercise. I pay tribute on this occasion to the energy, the industry and the capacity with which John Spender has stuck to the task and has welded together, out of all of the disparate strands of opinion which exist on this subject, a report which will, I believe, if it is implemented, as it should be by this Parliament, stand the test of time for a good many decades to come. Senator JESSOP(South Australia)(6.06) —I too wish to make a few comments on the report of the Joint Select Committee on Parliamentary Privilege and indicate that generally I am quite pleased with the thrust of the report. I wish to refer to one or two matters associated with the dissent that has been included in the report. Madam Acting Deputy President, you will recall that Senator Peter Rae and I drew the attention of all senators and members of the House of Representatives to one or two things that we thought required their consideration. It might be appropriate for me to seek to have the document entitled 'Matters requiring your attention' incorporated in Hansard so that it will be on the record. Leave granted. The document read as follows- AUSTRALIAN SENATE Canberra A.C.T. TO ALL SENATORS AND MEMBERS OF THE HOUSE OF REPRESENTATIVES Dear Colleagues, DRAFT REPORT OF THE JOINT SELECT COMMITTEE ON PARLIAMENTARY PRIVILEGE Matters Requiring Your Attention The Joint Select Committee has decided to present a draft report to both Houses and allow time for Senators and Members to comment upon the recommendations contained in the draft before a final report is presented. We support most of the Committee's draft recommendations. In particular, we support the conclusion of the Committee that there should be no general transfer of the powers of the two Houses to the courts. In relation to some of the draft recommendations, however, we have reservations . One of these recommendations involves a quite unjustified extension of parliamentary privilege to matters unconnected with parliamentary proceedings, and two other recommendations would have the effect of undermining the Committee 's intention not to transfer powers to the courts, and would allow an avenue for a de facto transfer. These recommendations we regard as unnecessary and unduly restrictive of the powers of the Houses and, in the instances referred to, quite dangerous. Our reservations are indicated in the relevant parts of the draft report. There cannot be any more important subject for the Parliament than the powers and immunities of the two Houses; if they are undermined the Parliament cannot function effectively and will wither as an institution. All Senators and Members are therefore strongly urged to consider the draft report and, in particular, the matters we have raised. We would be pleased to receive any views of Senators and Members on the draft report and on those specific matters. The following are our reservations about the draft report. Proposed Definition of Proceedings in Parliament We do not consider that, because there are no court judgments on specific questions in the area of parliamentary privilege, it should be assumed that the answers to those questions are 'doubtful' and therefore require statutory treatment to remove the supposed doubt. In particular, there is no basis for the supposed doubt about whether parliamentary committees meeting outside the precincts have privilege: it is clear that parliamentary privilege is not a geographical concept. The proposed statutory definition is therefore unnecessary in our view. We consider that it is unnecessary and dangerous to extend absolute privilege to correspondence with Ministers. Such correspondence is already covered by qualified privilege, and this is sufficient in our view. To give it absolute privilege would allow a member to be malicious in his dealings with Ministers without fear of legal redress. Absolute privilege should be restricted to proceedings in the Houses and their committees and matters closely connected therewith. The proposed definition deals only with the meaning of 'proceedings in Parliament' in the context of defamation actions, but the immunity contained in the Bill of Rights applies to other actions as well. The definition could create an anomaly in that the expression 'proceedings in Parliament' could be taken to have one meaning in defamation actions and a different meaning in other legal proceedings. Immunity from Civil Arrest and Attendance as Witnesses We consider that there is no need to alter the duration of the immunities; the practical effect of the common law rule as to their duration is that they are permanently in existence. We consider that the proposed statutory provisions would create more anomalies and uncertainties than exist at present; for example , it may be difficult for a court to ascertain when a parliamentary committee is meeting, and a member could extend the duration of the immunity simply by ensuring that he is involved in a large number of committee meetings. Defamatory Contempts We consider that it is unnecessary and undesirable to 'abolish' the category of contempt by defamation. If this is to be done by resolutions of the Houses ( which would be logical, since the Committee has not recommended the transfer of the contempt jurisdiction to the courts), such resolutions would not be binding on the Houses in the future in any case. If it is to be done by statute, this would allow the courts to review virtually every contempt case, because most contempts hinge on publication in some form, and an action could be brought in the courts to establish that any contempt fell within the statutorily prohibited category. The Committee has already rejected such review by the courts elsewhere in the draft report. It may not be possible in particular cases to clearly distinguish between contempt by defamation of the Houses and their members and contempt by intimidation of members. Warrants of Committal We do not consider it is necessary to adopt the recommendation concerning warrants of committal. In our view, if the Houses are to be trusted with the power to deal with contempts, as the draft report proposes, there is no point in inviting the High Court to rule on particular cases of contempt. Expulsion of Members In our view there is no justification for abolishing the powers of the Houses to expel members. The contention that the House of Representatives abused the power on one occasion is no reason for its abolition. It is irrational to say that the Houses can be trusted with their powers in relation to contempts but not with this power over their own members. (Don Jessop) (Peter Rae) Senator JESSOP —The Attorney-General (Senator Gareth Evans) mentioned the question of defamatory contempt. In the document which I have just incorporated Senator Rae and I drew attention to the following points: We consider that it is unnecessary and undesirable to ''abolish'' the category of contempt by defamation. If this is to be done by resolutions of the Houses ( which would be logical, since the Committee has not recommended the transfer of the contempt jurisdiction to the courts), such resolutions would not be binding on the Houses in the future in any case. If it is to be done by statute, this would allow the courts to review virtually every contempt case, because most contempts hinge on publication in some form, and an action could be brought in the courts to establish that any contempt fell within the statutorily prohibited category. The Committee has already rejected such review by the courts elsewhere in the draft report. It may not be possible in particular cases to clearly distinguish between contempt by defamation of the Houses and their members and contempt by intimidation of members. We went on to talk about warrants of committal and expulsion of members. Senator Evans mentioned the Laurie Oakes case. The House of Representatives Standing Committee on Privileges took umbrage at what was said by Laurie Oakes at that time. The Senate Standing Committee on Privileges, of which I was the Chairman, decided that it would not dignify the gentleman in any way and certainly would not want to bring him before the Senate Privileges Committee. I think the results prove that that exercise was futile in any case. I am very pleased with one aspect of the report which I think will be of quite considerable value to both the Houses of this Parliament, and that is in respect of proceedings in parliament. The report recommends: That, for a trial period, there be a limited right of reply to non-Members who believe that they have been subjected to unfair or groundless attack in Parliament. The proposal is that such persons could refer complaints to the Privileges Committee of the relevant House. There would be certain ground rules, for example, that the complaints should be confined to factual answer and not contain an attack on the Member involved. The Committee would be able to recommend that the rebuttal be incorporated in some form in the parliamentary record; An expanded definition of proceedings in Parliament for the purposes of defamation proceedings; That the laws of qualified privilege as they apply to reports of proceedings of the Parliament be modified to produce uniformity throughout Australia in the publication of fair and accurate reports of proceedings; I think the matter to which I referred earlier-the right of reply of non-members -is a progressive step because members of parliament seem to be brought into disrepute on some occasions by members or senators attacking under privilege members of the public or of the Public Service. I think this is an unfair way to lodge any criticisms against people outside the Parliament. This recommendation will help to overcome that problem and perhaps persuade senators and members to think very carefully before they attack under privilege people who are outside this House. I believe that it will go a long way to restoring some sense of responsibility among some members of the Senate and the House of Representatives and may help to restore the reputation of members of parliament in the eyes of the community. I sincerely hope it does. We have suggested that this recommendation be carried out on a trial period of 12 months and that either House of the Parliament can continue that practice if it so chooses. Madam Acting Deputy President, I draw your attention and that of the rest of the Parliament and of the Senate in particular to the minority report that has been put forward by Senator Peter Rae and me because we believe that our minority report is more consistent with the general thrust of the total report. In conclusion, I wish to endorse what Senator Gareth Evans said about the chairmanship. Mr Spender worked hard on this matter, as did Bernard Wright of the House of Representatives. Mr Harry Evans, who assisted us in an advisory role, was immensely helpful to me and to other honourable senators in providing advice with respect to this important subject. Senator PETER RAE(Tasmania)(6.13) —I wish also to refer to the draft report of the Joint Select Committee on Parliamentary Privilege and to add to what has been said in relation to the chairmanship of Mr Spender and the work that he put in. I refer also to the unholy alliance which took place between him and the Deputy Chairman, Senator Gareth Evans, but which eventually produced a report which I believe is an extremely important review of the total law of privilege as it relates to the Parliament. I emphasise that when I am referring to privilege, I am not using it in the sense that so many members of the public take the word privilege to mean; rather it is really the law of parliament, the procedures, the protection of the rights of people vis-a-vis the Parliament and the right of parliament to be able to operate with which we are dealing. The concepts with which we are dealing are concepts which have developed since the whole Westminster system, as it is so often called-the British Parliament- developed in the past 800 years. A large number of the traditions and processes which we now apply were built up through the experience of those 800 years and the battles that took place between the Executive and the Parliament during that time. It is important that there be a protection of the parliamentary process and it is important that there be a protection of the people who are affected by that parliamentary process. This is what the report is all about. It includes a number of matters to which reference has been made by my colleague Senator Jessop. As he did, I simply draw attention to the fact that in our report we dissented from a number of matters, but totally accepted the general thrust of the main report that there should not be any undue codification of the law of parliamentary privilege. There should not be any undue transfer of the powers of the high court of Parliament, which Parliament traditionally has been, to other judicial areas under our Constitution. We have therefore made a recommendation which I think reviews very rationally the rights of both parliament and the people who are affected by parliament. It ensures that some of the notions which have in the past been regarded as offending the principles of natural justice are reviewed and are to be applied. One could summarise the report by saying that it has opted for assuring that the rules of natural justice shall be applied to the law relating to the Parliament-the protection of parliamentarians , the institution of parliament and of the people who are affected by parliament . One aspect I want to refer to in particular is the question of enforcement of fines. Whether there is or is not at the moment a power to fine, one of the recommendations of the report is that there should be a power to fine for certain types of contempt of the Parliament. As a member of the Senate Privileges Committee currently dealing with a complaint of breach of privilege, I do not want to comment in detail on that at the moment. For that reason I will be seeking leave to continue my remarks later, as I understand that the debate can then be adjourned and can be resumed after people have had an opportunity to read the full report. I will then feel a little more free to make some further comments. One comment I wish to make at this stage is that if there is to be a power to fine, there needs to be a sanction, a way of enforcement. Enforcement by gaoling , I would have thought, is not a very satisfactory way of enforcement because if it is appropriate to impose a fine in the first place, it is appropriate to ensure that the fine is paid rather than impose a gaol sentence on a person for a breach of what amounts to the original offence. We obtained an opinion which has, I believe, been tabled with the report in the other House. I wish it to be tabled in this chamber as well. It is an opinion from the Secretary to the Attorney-General's Department, dated 18 September 1984 and therefore received just a short time ago, in which he referred to a possible scheme. I commend that scheme to honourable senators for their consideration. That scheme proposes that in effect an order made by a House of Parliament would be registered as a judgment. I suggest it would be appropriate that it be registered on the certification of the Presiding Officer of either House, with the Supreme Court of the Australian Capital Territory, and with the powers of enforcement which a judgment of the Australian Capital Territory Supreme Court would have. That means that the normal processes of the law would then apply in the enforcement of the fine which had been imposed. I do not think that the Parliament is equipped to go through the sorts of processes necessary to enforce the payment of the fine. The only alternative, at least in the first instance, is gaoling, which is too draconian. I draw that to the attention of honourable senators. With those brief remarks, I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator PETER RAE(Tasmania)(6.21) —by leave-I present the official report of the Australian parliamentary delegation to the European parliamentary institutions and to France in 1983. I seek leave to move a motion. Leave granted. Senator PETER RAE —I thank the Senate. I move: That the Senate take note of the report. The delegation which went to the European parliamentary institutions in 1983 went not only to the Council of Europe generally and to the Council of Europe's particular Organisation for Economic Co-operation and Development debate, but also the European Parliament. It also went to the North Atlantic Assembly, which is the parliamentary assembly for the North Atlantic Treaty Organisation members . It took part also in the Strasbourg conference on parliamentary democracies. That was an extremely valuable opportunity for Australia to improve its relationships with Europe. I would like to talk a little of history and to go back to some of the problems that we have had in being a little distant from Europe. After the common agricultural policy and the European Economic Community were developed, Australia tended to be shut out of Europe. It had to find new markets, build new relationships and take new steps. It concentrated on doing that and did it very successfully. We have found that the balance of trade in the 1980s has changed very dramatically from that which applied in the 1950s. We have also found that another change has taken place; that is, that the growth area of the world has moved from Europe. It is now far more related to the Pacific and, in particular, the western Pacific. There has been a lack of realisation on the part of many Europeans and European parliamentarians of the extent to which Australia is part of the western Pacific. It has an opportunity through its traditional relationships with Europe to help Europe to participate in and perhaps better understand the western Pacific. I think it is also extremely important for Australia to remind Europe of some of the problems which the Europeans caused to Australia. In particular, the common agricultural policy produces huge surpluses of subsidised primary products which are then sold at relatively low prices in many of the markets which we have been at great pains to build up. That is a matter of considerable concern to Australia and too often has been forgotten by the average member of the European parliamentary institutions. Over several years we have been able to build up a relationship with Europe whereby there is some contact on a more permanent basis. We have in Australia an Australia-Europe Parliamentary Group. That group has only relatively recently been formed. I hope it will develop a much more permanent relationship with a similar group at the European Parliament . It is called the Australia-New Zealand Parliamentary Delegation of the European Parliament. It is a group of people who have a particular interest in us. It is proposed that once every three years it will visit Australia and New Zealand so that there will be a continuing relationship, a continuing liaison and a continuing opportunity for understanding between the countries making up the European Economic Community and Australia and New Zealand. As that understanding is developed, so too can some of the problems be overcome . Whilst I do not expect to see any dramatic change overnight in the common agricultural policy, it has been interesting that in the three times that I have gone as a member of this delegation, starting in 1978, I have seen the change that has come about in the degree of understanding and acknowledgment of the problems which are created for some other areas of the world by the operation of the common agricultural policy in Europe. I was pleased to see that in 1983 the delegation had the opportunity to circulate at the parliamentary assembly of the Council of Europe a paper which became a formal paper of that Council. That paper is of three printed pages and sets out briefly, but in sufficient detail to be understandable, the problems and some of the concerns of Australia in relation to the common agricultural policy. It was our opportunity to make sure that all members of the Council of Europe have available to them, translated into their languages, our case stated relatively briefly in relation to the damage being done by the operation of CAP. We also had the opportunity to be able to circulate to the Council of Europe a paper in relation to the steel industry in Europe. It was interesting and, I thought, typical that whilst Australia is a relatively big producer of steel, an important producer in the whole steel process in the quantities of iron ore and coal which it exports as well as the steel which it produces and has an important role in the total steel industry of the world, the Council of Europe when looking at the steel industry made no reference at all to the position of Australia. There was no recognition that Australia had a steel industry. It referred to the position of the United States and Japan, but did not refer to Australia. I was delighted to find that such is the degree of co-operation which has now been developed over the years with the Australian delegations visiting Europe that not only did the Council of Europe again accept a paper which it circulated as one of its own papers to each of its members, but it also was prepared to accept a recommendation which we made in the paper which added a paragraph to its resolution. This paragraph read: Bearing in mind that the decisions taken in relation to Europe's steel industry have major ramifications for Australia both as a steel producer but even more importantly as a major supplier of raw materials, will request the governments of its member States and of the EEC. (a) to have regard to those ramifications when taking action pursuant to the foregoing proposals and policies; and (b) to consult with Australia, as an OECD member, when developing new international policies relating to the steel industry. I think that that is an excellent example of the sort of opportunity which arises as a result of the development of this liaison between the European parliamentary institutions and the Parliaments of Australia and New Zealand. We were able there to get the Europeans to say, in effect: 'Oops, sorry, yes we acknowledge that we have not made reference to Australia, we acknowledge that Australia has got an important role to play in relation to steel. We will add that and we will undertake to recommend to the governments of Europe that they should consult'. I am glad to be able to indicate that that is just one of the examples of the positive side. Another example of the positive side is that Australia is able, as a member of the OECD, to speak in the plenary session of the Council of Europe during the debate on the OECD paper which is given by the Secretary-General. It is also able to meet with the committees and the parliamentary groups of both the Council of Europe and the European Parliament. Those meetings with the committees are of particular value. I believe that one of the greatest benefits is the opportunity the delegation had to get down to direct discussion with the committees of those major parliamentary institutions. The interchange which can take place there can do immeasurable good to the mutuality of understanding and, therefore, the solution of what might otherwise be unintentional problems. I refer also to the opportunity which we have now to participate in relation to the North Atlantic Treaty Organisation. I do not think that we would find many people in this country who would suggest that our interests are not very closely interlinked with the interests of NATO. Over the years the parliamentary assembly of NATO, the North Atlantic Assembly, has been limited to members of the NATO organisation and the considerations of the Assembly have tended to be limited to the NATO area. Of more recent times consideration has been given to this matter. Sir Patrick Wall, the President of the North Atlantic Assembly, for one has been extremely interested in developing further the relationship of NATO with its other mutual interest 'allies'. The Assembly has decided to invite annually to its meetings representatives from Japan and also parliamentary observers from Australia and New Zealand. So one of the recommendations which the parliamentary delegation comes back with and places before the Parliament is that the invitation which was extended first in 1982 and then formalised in discussions which took place last year with Mr Deshormes, the Secretary-General, and Sir Patrick Wall, the President of the North Atlantic Assembly, for Australia to become a permanent parliamentary observer at the North Atlantic Assembly, should be accepted. The extent to which a change is taking place in the attitude of the North Atlantic Assembly is, I think, signified by the fact that next year the Assembly proposes to hold its conference for the first time outside the North Atlantic area. The conference will be held on the west coast of the United States of America and inevitably the Pacific will be looked at during the discussions that take place. There has been, therefore, a recognition that defence of the North Atlantic area is a global matter. A clear interest has been expressed by some of the western Pacific countries, particularly Australia, New Zealand and Japan, to participate in the consideration of the very wide and broad matter which are considered by the Northern Atlantic Assembly. The Assembly does not consider only military aspects but also the social and economic aspects of the defence of the western democracies. We have been invited to participate in the economic, military and political committees of the Assembly. We have also been given the opportunity to speak during the plenary session of the Assembly. I think it is a very major step forward for Australia to be invited to participate. This again brings us closer to the parliamentary institutions of like mind and like kind democracies that continue to exist in this world. It is for that reason that I believe we should most certainly accept the opportunities and invitations and continue to take very great care to ensure that we develop the relationships which have been started. We look forward to the visit early next year by the Australian-New Zealand delegation of the European Parliament. We look forward to its visiting Australia and to being able to have discussions with its members to ensure that they are brought up to date. I hope we will be able to look after them as well as they looked after us when we visited them in Strasbourg. I would like to refer briefly to Mr Bill Morrison, the leader of the delegation last year, who referred to a number of these matters when he tabled the report of the delegation on 13 September in the House of Representatives. His speech is set out on pages 1270 to 1272 of Hansard. I will not repeat the matters to which he referred. However, I would like to indicate my thanks to him for his work as leader of the delegation. In fact, the roles we played on this occasion were reversed because the year before I had been the leader of the delegation and he had been the deputy leader. I believe that we worked extremely well together and co-operatively on both occasions. I would also like to express my thanks, as he did to the Australian Ambassadors to France, Mr Peter Curtis and to Belgium, Mr David Anderson, for the work they did in providing the various forms of assistance to us during our visit. I would also like to express our thanks to various members of the staff of the embassies including, in particular, Godfrey Santer who was of great assistance to the delegation. I would also like to refer to the work that was done by Rob Diamond who was the secretary to the delegation. Rob Diamond, who accompanied the delegation, had the very dreadful task of trying to draw it together, make sure that people turned up on time and were in the right places at the right time, that the right sorts of papers were available and all the rest of the jobs that had to be performed. All I can say is that it is a job that I would not have for anything. I congratulate him on having done it extremely well. I am glad that he is in the chamber at the moment to hear me say that because he did an excellent job in that capacity. I support the continued participation of the Australian parliamentary delegations in European parliamentary institutions. I hope that this will become a permanent feature and that we shall also be able to accept the invitation which has been extended by the Pacific Forum meeting in Hawaii to meet with the Japanese and other parliamentary democracies to consider issues concerning the Pacific area, along with those of NATO. That invitation of course, has been extended to Mr Morrison and me to participate at the beginning of January next year. I hope that ways will be found for us to be able to accept that invitation . Finally, I pay tribute to the friendliness and co-operation of the other members of the delegation to whom I have not made specific reference and thank the French Government which also entertained the delegation for a period after the conclusion of the visit to the European parliamentary institutions. I thank the French Parliament-the French Senate, in particular-for an extremely pleasant luncheon and an interesting time. One was amazed to view the splendour of the Parliament in Paris. I also thank the Prefect at Macon who looked after the delegation and even the French national railways which took us on its magnificent train, the TGV, from Paris to Macon at an average speed of about 260 kilometres an hour with a smoothness which was remarkable. I think we could give further thought to the introduction of such a magnificent service in Australia. I thank the Senate. Question resolved in the affirmative. Debate resumed from 12 September, on motion by Senator Reid: That the Senate take note of the report. Senator REID(Australian Capital Territory)(6.43) —The report was presented on 12 September. I think it is fair to say that it has been well received by the individuals and groups who are interested in it. It now awaits the response of government and I guess to a significant extent the response of the National Capital Development Commission in planning decisions to be made in the future. I guess it will be discussed again when responses are received. Question resolved in the affirmative. The DEPUTY PRESIDENT —I inform the Senate that I have received a letter from Senator Georges submitting his resignation as a member of the Council of the Australian National University and a letter from the Leader of the Government in the Senate (Senator Button) nominating Senator Zakharov to be a member of the Council of the Australian National University. Motion (by Senator Ryan)-by leave-agreed to: That, in accordance with the provisions of the Australian National University Act 1946, the Senate elect Senator Zakharov to be a member of the Council of the Australian National University until 18 July 1986 to fill the vacancy created by the resignation of Senator Georges. Bills received from the House of Representatives. Motion (by Senator Ryan) 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 all or several of the Bills being put in one motion at each stage and the consideration of all or several 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 Ryan) read a first time. Second Readings Senator RYAN(Australian Capital Territory-Minister for Education and Youth Affairs)(6.46) —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- Income Deposits Legislation Income Deposits Legislation LOAN (INCOME EQUALIZATION DEPOSITS) AMENDMENT BILL 1984 [No. 2] The Government is resubmitting to the Parliament two Bills, which were not passed by the Senate during the autumn sittings, to give legislative effect to changes to the Income Equalization Deposits Scheme. These changes had been previously announced in ministerial statements. The two Bills are the Loan ( Income Equalization Deposits) Amendment Bill 1984 and the Income Tax Assessment Amendment (Income Equalization Deposits) Bill 1984. The Government is also introducing, for the first time, the Income Equalization Deposits (Interest Adjustment) Bill 1984. I need not dwell on the provisions of the two Bills which have been previously submitted to the Senate. Details were given in the second reading speeches at that time and were also described in the explanatory memoranda then circulated. The provisions of the Bills the Government is now introducing are identical to the earlier Bills. In essence, the aim of the income equalization deposits scheme is to encourage primary producers to deposit monies in years when their incomes are high, so as to provide funds which can be drawn upon when incomes are lower. The scheme, as amended, will have no taxation consequences other than the normal taxation of interest on deposits as income. The new tax averaging arrangements generally remove the inequity, which would otherwise be experienced by primary producer taxpayers with fluctuating incomes, without the need for income equalization deposits. The averaging provisions have the effect that tax in both high and low income years will be calculated at the average rate corresponding to average income. Over a run of years that gives a comparable result to taxpayers who have similar, but not fluctuating, incomes. While the removal of the in-out option under the various averaging provisions removed much of the possible manipulation associated with the interaction of the former IED and averaging schemes, continuation of the former IED arrangements would still have allowed the possible manipulation of provisional tax payments. The old arrangements also provided the greatest benefits to primary producers with the highest marginal tax rates. Hence depositors in the IED scheme with the highest incomes benefited most. All primary producers using the new scheme are eligible to receive similar benefits. The incentive to make deposits will be an attractive interest rate, set quarterly at two percentage points above the short term Commonwealth Treasury bond rate. The eligibility criteria which determine whether this high rate is received on deposits will be broadly the same as under the former arrangements. Only primary producers are eligible for the higher rate. Deposits up to a limit of $250,000 deposit stock will be eligible for the concessional interest rate. Any deposits made above $250,000 would be paid interest at a rate of three percentage points below the short term bond rate. A primary producer may make in any income year new deposits eligible for the higher rate of interest, up to an amount equivalent to the lesser of: sixty per cent of his or her gross receipts from primary production in respect of that year; and his or her taxable income in respect of that year, other than income derived from property. An eligible deposit made at the higher rate will continue to attract interest paid on that basis as long as the depositor continues in the business of primary production. Withdrawals from the scheme will be possible on a similar basis as in the past. That is, deposits may be withdrawn at any time after 12 months, or within twelve months on grounds of financial hardship. The Income Tax Assessment Amendment (Income Equalization Deposits) Bill 1984 which I shall introduce shortly provides for amendments to the Income Tax Assessment Act so as to remove the provision that income equalization deposits made by eligible primary producers attracted income tax deductions. As a result of that Bill, deposits made after 1 September, 1983 will attract no special income tax consequences and in particular the income tax deduction previously allowable for eligible deposits will be withdrawn. I have outlined the provisions contained in the Bill on a previous occasion. I again point out that the Bill will enable depositors under the former income equalization deposits arrangements or the previous drought bonds scheme to convert those instruments to the new scheme so as to take advantage of the special rate of interest payable. Further explanations of the features of the Bill are contained in the explanatory memorandum that was made available to honourable members when the previous Bill was introduced on 10 June, 1984. When the Senate failed to pass these two Bills, to which I have now referred, the Treasurer announced on 29 June, 1984 that the Government intended to maintain its policy on the scheme-as had been announced in 1983 and as had been operating since September 1983. Because of the failure of the Senate to pass the Government's legislation however, primary producers, in the absence of any action by the Government, could have gained unintended benefits. That is, deposits lodged since 1 September, 1983 would have remained tax deductible and would also have earned the higher, concessional interest rate intended to apply under the revised scheme. Having regard to the unintended benefits, the Government lowered the rate of interest applying on or after 29 June, 1984 to deposits made since 1 September, 1983. The rate was lowered to 7.5 per cent per annum, to apply pending reconsideration by the Parliament of the legislation which is now being resubmitted. Thus, the purpose of the Income Equalization Deposits (Interest Adjustment) Bill 1984 is to provide for backpayment of interest in respect of income equalization deposits made since 1 September, 1983. The backpayments will relate to the period between 29 June, 1984 and the commencement of this Bill and will be calculated as the difference between the interest actually paid during that period at the rate of 7.5 per cent and the interest which otherwise would have been paid had the Senate passed the IED Bills when they were presented to it. If the legislation as resubmitted by the Government is agreed to on this occasion, eligible deposits will receive the higher interest rate as if the Loan Amendment Bill had been passed in the first instance. As for the revenue costs of the new incentive arrangements; they are not expected to be very different to the cost of the former scheme-but the benefits will be spread more equitably. In conclusion, I remind the Senate that the new IED scheme has been designed to allow primary producers to deposit funds with the Commonwealth at interest rates higher, and on conditions more favourable, than those on Commonwealth securities offered to the general public. This assistance is intended to motivate primary producers to prepare for lean years. However it does not enable the wealthy to benefit more per dollar deposited, as did the former scheme. Therefore this scheme should be particularly welcomed by smaller primary producers and those concerned with equity in our community. I commend the Loan (Income Equalization Deposits) Amendment Bill 1984 to the Senate. INCOME TAX ASSESSMENT AMENDMENT (INCOME EQUALIZATION DEPOSITS) BILL 1984 [No. 2] In introducing the Loan (Income Equalization Deposits) Amendment Bill 1984, I outlined the general purpose of this Bill. Its detailed provisions were described when it was previously introduced to the Senate and those provisions remain unaltered. I commend the Bill to the Senate. INCOME EQUALIZATION DEPOSITS (INTEREST ADJUSTMENT) BILL 1984 In the second reading speech on the Loan (Income Equalization Deposits) Amendment Bill 1984, I described the purpose of this Bill and its relationship to the Loan Amendment Bill and the Income Tax Assessment (Income Equalization Deposits) Amendment Bill. I commend the Bill to the Senate. Debate (on motion by Senator Reid) adjourned. Bills received from the House of Representatives. Motion (by Senator Ryan) 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 Ryan) read a first time. Second Readings Senator RYAN(Australian Capital Territory-Minister for Education and Youth Affairs)(6.47) —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- STATES (WORKS AND HOUSING) ASSISTANCE BILL 1984 The main purpose of this Bill is to authorise payments in 1984-85 arising out of two decisions, taken at the recent Loan Council meeting, which fall outside the provisions of the Financial Agreement Act 1928. Specifically the Bill seeks to authorise the continued payment of: general purpose capital grants to the States; and such amounts as the States and the Northern Territory nominate from their approved 1984-85 borrowing programs as being for the purposes of public housing on concessional terms and conditions. To provide scope for continuity of payments the Bill also provides for the payment of capital grants and concessional housing loans in the first six months of 1985-86. The amounts to be advanced under these provisions are limited to an amount equal to one-half of the grants to be paid in 1984-85 in the case of the grants and an amount equal to one-half of the approved borrowings in 1984-85 in the case of funds nominated for public housing. Grants amounting to $521.5 million, equal to one-third of the approved Loan Council programs for the States in 1984-85, were agreed to at the 21 June 1984 Loan Council meeting. These Grants are made in accordance with arrangements originally adopted at the June 1970 Premiers' Conference, whereby the Commonwealth Government provides a portion of the States' Loan Council programs as interest-free non-repayable grants, instead of what would otherwise be interest-bearing borrowings by the States. The effect of the grants is to relieve the States of debt charges (that is, interest payments and sinking fund contributions) which they would otherwise have to pay, and the grants accordingly have a substantial beneficial effect on the States' financial positions. The States are free to apply these grants as they choose. The arrangements whereby the States and the Northern Territory are able to nominate part of their approved borrowing programs for public housing were introduced in 1982-83. As a condition of the payment of these funds, the Bill contains a provision that a State or the Northern Territory must be able to meet its matching requirements for the purposes of the Commonwealth-State Housing agreement. Subject to that, the nominated funds will be provided to the States and the Northern Territory at the loan terms and conditions set out in the Commonwealth- State Housing agreement, and hence will bear interest at the highly favourable rate of 4.5 per cent per annum and will be repayable over 53 years. The object of providing concessional loans for public housing is to provide an incentive to the States to increase the amounts that they would otherwise direct to public housing. This is in addition to the various direct forms of Commonwealth assistance to the States for housing purposes which in 1984-85 are being provided under a new Commonwealth-State Housing agreement currently being concluded with the States by my colleague the Minister for Housing and Construction. Payments under the new agreement will amount to $623 million in 1984-85, an increase of 19 per cent over expenditure on similar programs in 1983-84 and an increase of 77 per cent on the amount provided in the last year of the previous government. The assistance being provided under this Bill forms part of the State Governments' new money programs for 1984-85 as approved by loan council and the analogous general purpose capital payments to the Northern Territory. In 1984-85 , these general purpose capital funds amount to $1702 million, an increase of 6. 5 per cent over the amounts for 1983-84. This Bill forms an important part of the Commonwealth's overall financial assistance to the States and Northern Territory. I commend the Bill to the Senate. HOUSING ASSISTANCE BILL 1984 A year ago when introducing the First Home Owners Bill 1983 my colleague, the Minister for Housing and Construction, said that the Government had an ambitious and innovative program, for action in housing, designed to achieve the dual objectives of ensuring that housing plays a key role in our economic recovery and in ensuring that Australian families can gain access to adequate housing at a price they can afford. Mr Hurford identified the objectives of our programs as being: to provide more effective assistance to low income families seeking to buy a first home and to ensure an adequate supply of housing finance at affordable interest rates to generate additional activity in the housing industry in order to stimulate job creation and economic growth-to re-establish confidence in this vital industry and to increase the availability of public housing and other innovative forms of low cost housing for the large number of needy households in the community. The Hawke Labor Government was elected with a firm commitment to renegotiate Federal housing arrangements with the States. This Bill, the Housing Assistance Bill 1984, honours our commitment to revamp public housing policy and assistance in Australia. This is an important piece of social legislation. No honest person can deny the success of the Government's measures to date. In the short time since coming to office the government's policies have led to a rejuvenation of the housing industry, and to a large number of Australians acquiring their first homes. Housing finance has increased by some 30 per cent, and housing starts have risen from a low 105,000 in 1982-83 to an estimated 135, 000 in 1983-84. Some 55,000 first home buyers received assistance under the Government's First Home Owners Scheme during 1983-84, and an additional 80,000 first home buyers are expected to benefit from the scheme in 1984-85. The housing industry is now set on a firm footing for the future, housing finance is readily available at affordable interest rates and in recognition of these facts measures announced in the Budget have enabled FHOS to be better targetted. Housing commencements in 1984-85 are expected to be in the range of 140,000 to 145,000. With regular reports from the Indicative Planning Council and through wide consultation with the industry, the Government is determined to avoid the costly 'boom and bust' syndrome of recent years, and will be seeing to ensure that commencements continue at sustainable levels in the future. A year ago the Minister said that, with the introduction of the First Home Owners Scheme, we would not be resting on our laurels. Mr Hurford indicated that the Government had commenced work on the renegotiation of the Commonwealth-State Housing Agreement, and that a key feature of the renegotiation would be a focus on more innovative approaches to the provision of public housing. It was indicated that discussions would be held with the State Governments, local governments and community groups on measures to expand the range of low cost rental housing for people with an acute need for housing, and to expand community housing. These negotiations and discussions have now been completed, and the Housing Assistance Bill 1984 authorises the Commonwealth Government to enter a ten year agreement with each State and the Northern Territory for the provision of home purchase and rental assistance housing for low to moderate income earners. This legislation sets the stage for our ten year assault on housing poverty. It will be the largest housing assistance package ever undertaken in Australia. Taken together with the related increase in the Budget in the level of supplementary assistance for pensioner households in the private rental market, it reaffirms this Government's intention to improve the housing circumstances of those least able to help themselves. The new Agreement is an important social document. It sets out principles to guide the development of public housing over the next ten years. The twin objectives are to alleviate housing related poverty and to ensure that housing assistance is, as far as possible, delivered equitably persons resident in different forms of housing. All State Housing Ministers have endorsed these objectives. The legislation recognises that housing assistance provided under the Agreement should be available to all sections of the community provided that priority in granting assistance is determined by the need for assistance. Programs under the Agreement will be developed so as to increase progressively the availability of public housing to a level commensurate with the need for it in the community. This will be done in such a way as to avoid the social stigma and related problems so frequently associated with past housing assistance. All Housing Ministers agree that it is essential to provide a viable and diversified choice of public housing. The Agreement covers programs of assistance to tenants and home purchasers. These programs are structured so as to ensure that those unable to obtain or afford housing in the private market have considerable flexibility in choosing the form of assistance that suits them best. The spirit of the new Agreement is that every Australian has a basic right to adequate and affordable housing. There are currently some 137,000 people on waiting lists for public-rental housing, and many thousands of others discouraged from applying because of the lengthy waiting times for assistance. Most of those applying for assistance are pensioners and beneficiaries currently paying high proportions of their income in rent or staying in overcrowded or sub-standard accommodation. The Government recognises that the massive housing problems facing low income earners cannot be overcome in one or two years. This is why the Agreement is placed in a ten year framework. We have entered into a long term commitment to those in housing need. Currently throughout Australia, there are some 250,000 dwellings in the public housing stock. This Agreement will cover rental and tenancy policies for these dwellings and others progressively added to that stock. Rents for dwellings will be related to the cost of provision and not to so- called market rents which are outside the influence of the public sector. Over the life of the Agreement this should result in a decline in real terms in the level of rents for public housing which will provide long-term tenants with some of the benefits of home ownership. Those tenants who are unable to afford the asking rents will continue to pay rents which are related to their incomes. About 60% of public tenants pay reduced, or rebated, rents. As a means of further enhancing the position of tenants, the Agreement provides for tenants to be actively involved in the management of their dwellings. Co- operative housing arrangements, for instance, are encouraged through both administrative and financial practices. The Agreement also provides for specific housing assistance programs including Pensioner housing Aboriginal housing Crisis accommodation Mortgage and rent relief Local government and community housing Even with ongoing programs, such as Aboriginal housing, there will be a new approach. For example, under the new arrangements agreed with the States, Aboriginals will be closely involved in the provision of Aboriginal housing assistance and a number of States have or are moving to set up Aboriginal Housing Advisory Boards to assist in the administration of these funds. The Crisis Accommodation Program will rationalise a number of small unco- ordinated programs. The aim is to provide emergency accommodation where needed. This program will link in with the proposed Supported Accommodation Assistance Program. Mortgage and rent relief assistance was previously provided outside the CSHA. The Mortgage and Rent Relief Scheme is now properly brought within the CSHA to ensure that assistance is fully co-ordinated with other public housing assistance. One innovative feature of the new Agreement will be the new Local Government and Community Housing Program which will aim to give local communities a bigger say in public housing. The focus of the program will be on providing alternative forms of public housing and on developing tenant participation in the management of public rental housing. Local Governments and community groups will be able to develop projects such as co-operatives, group housing and boarding house accommodation, which will assist in meeting needs in their areas. Financial assistance will be provided to local governments and community groups to buy, build, lease or upgrade dwellings for low cost rental housing. Local communities will also be able to borrow from the private sector with government assistance. The net effect of this will be to expand and diversify Australia's stock of housing available for low income earners. The dwellings will be managed by local governments and community groups. Most Australians aspire to home ownership. The home purchase programs in the Agreement are structured to make this achievable. Borrowers will be provided with low start loans. Repayments will be linked to income. Interest concessions available in the early years will be repaid where possible. These arrangements will mean that should a borrower face a reduction in income, loan repayments will not become crippling. The home purchase assistance arrangements also make provision for new rental purchase arrangements, as a means of further ensuring that those wishing to buy a home are able to do so. The arrangements will provide a safety net to both public housing tenants and those renting privately who wish to purchase but are uncertain about their financial ability to do so. To achieve this, title of the dwelling will remain with the housing authority. Thus in a case where the purchaser does get into financial difficulty the household can remain securely in that dwelling. However, in order to maintain the stock of public rental dwellings, rental housing assistance funds will not be allowed to be used to finance rental purchases. These purchases will instead be financed in the same way as other assistance for home purchase under the Agreement. Mr President, the principles and policies incorporated in this legislation will benefit many thousands of Australians. However, funding commitment is required to back up these fine principles. This Government is providing the necessary funding commitment. In 1984-85, some $623m will be provided for public housing. As part of the financial arrangements, $569m is being appropriated in the Budget and will be supplemented by $54m appropriated by the Housing Assistance Act 1981. Funding this financial year will be about 9% higher than comparable funding in 1983-84 under various programs including the special employment assistance provided under the wage pause program. The following table shows details of comparative funding for public housing in recent years: FEDERAL ASSISTANCE TO THE STATES AND THE NORTHERN TERRITORY FOR PUBLIC HOUSING 1981-82 - 1984-85 Loans Grants Total $m $m $m 1981-82 146.0 118.1 264.1 1982-83 146.0 260.2 406.2 1983-84 146.0 420.9 566.9 1984-85 . . 623.3 623.3 All Federal funding in 1984-85 will be provided by way of grants. This is not necessarily a precedent: in future years some 75% of Commonwealth funds will normally be provided as grants, and the remainder will be provided as loans on the highly concessional terms of 4.5 per cent per annum interest repayable over 53 years. This generous assistance recognises the cost pressures being faced by the State Governments in housing very low income persons. The State Governments will be expected to continue to play their parts. In 1984 -85 States will be expected to match $450m of the Federal funding. In later years they will be expected to match all Commonwealth untied funding on a dollar for dollar basis. As an additional incentive to the States to provide funding for this vital area of social need, in 1984-85 the Government is continuing to permit States to nominate funds from their Loan Council borrowing programs for public housing and receive these funds on the concessional CSHA loan terms and conditions, i.e. interest of 4.5% per annum repayable over 53. Some $227m was nominated by the States under this arrangement in 1983-84. In all, it is expected that over $1,500m will be made available for public housing in 1984-85 from Commonwealth and State Government sources. The legislation provides for base funding of $500m in 1985-86 and 1986-87. It also provides for $10 m. in each of these years for the Local Government and Community Housing Program. This compares with minimum funding of $200m per annum under the 1981 Agreement. The Bill provides for Commonwealth funds to be allocated between the States and the Northern Territory on the basis set out in the 1981 legislation. This maintains the move to per capita funding over the period to 1990-91 subject to minimum provisions to protect the smaller States. There will be an Annual Report to be tabled in Parliament each year which will include an assessment of housing needs and a summary of assistance for housing being provided by governments. This Bill reaffirms this Government's commitment to ensuring that all Australians, no matter what their station in life, have access to adequate and affordable housing. It is the result of inputs from a wide range of interested organisations and individuals. It has been moulded after considerable discussion with State Housing Ministers. It is a consensus reflecting their assessment of how best to deliver an effective and equitable program of public housing assistance. I commend the Bill to the Senate. Debate (on motion by Senator Reid) 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 Ryan) read a first time. Senator RYAN(Australian Capital Territory-Minister for Education and Youth Affairs)(6.48) —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- On 2 May 1984 the Government introduced into this chamber a bill identical in all respects with this Bill. That Bill resubmitted measures contained in the Income Tax Assessment Amendment Bill (No. 5) 1983, which the coalition parties in this place and some other senators combined to reject outright. Honourable senators will recall that the Bill introduced on 2 May 1984 was effectively rejected by the decision to defer consideration of the measures contained in it. The government is not prepared to let the matter rest there. As was clearly described in second reading speeches on the introduction of the earlier Bills this legislation is aimed at the shabbiest of schemes. Some proprietors of businesses, after establishing Superannuation funds purportedly to provide Superannuation benefits for their employees, wind-up the funds in circumstances where the accumulated assets of the funds are paid out, not to the employees, but to the proprietors themselves. This happens after advantage has been taken of the considerable tax concessions provided for Superannuation contributions and the income of the funds. One technique adopted is to terminate the unsuspecting employees' employment under some pretext or another shortly before they would otherwise become entitled to substantial Superannuation benfits from the funds. Even some long serving and loyal employees have been dealt with in this fashion. Another variation is to make tax deductible contributions to a fund for workers who, in the ordinary course of events, do not stay long with their employer. Typically this can occur in relation to people who engage in seasonal work-hence the notorious label ''Cherry Picker'' schemes that has been attached to these arrangements. The benefits that are ''forfeited'' are then allocated to the proprietors who, technically as the sole remaining employees, take the whole of the accumulated assets. The funds, having been wound-up in this way, are not then able to meet any tax liability which, under the existing law might fall to be met by them once all the facts have emerged. Not only does the revenue, and therefore the Australian taxpayer, suffer by these particularly distasteful practices, but the unsuspecting ordinary employees of companies are deprived of Superannuation benefits accumulated in their name and ostensibly for their benefit. As we have said before, it is difficult to imagine a more brazen abuse of the taxation law and no sympathy should be wasted on those who have sought to take advantage of devices ingeniously planned to give the appearance of bona fide Superannuation arrangements but hollow in reality. The intended losers are the taxpayers of Australia while the intended winners are those who would seek to enjoy the benefits and privileges of living in this country without meeting their rightful share of the fiscal burden. A carefully defined policy of retrospective application of anti-tax avoidance legislation was one which we put before the people of Australia on 5 March last year and on which we were elected to government. Yet the Opposition parties continue to frustrate the government's attempts to give effect to a clearly stated and endorsed election commitment. While the Commissioner of Taxation is vigorously seeking to challenge these schemes under the existing law the appropriate response, the only response certain to be wholly and speedily effective, is that proposed once more in this Bill. A technical explanation of the proposed section 26AFA is contained in the memorandum that was circulated to honourable senators at the time of introduction of the Bill containing the original measure. I commend the Bill to the Senate. Debate (on motion by Senator Reid) adjourned. Messages received from the House of Representatives intimating that it had agreed to the amendments made by the Senate to the following Bills: Australian National University Amendment Bill 1984. Canberra College of Advanced Education Amendment Bill 1984. Senator REID(Australian Capital Territory) —by leave-I give notice that, on the next day of sitting, I shall move: (1) That a Select Committee, to be known as the Select Committee on Video Censorship, be appointed to report on the operation of Regulation 4A of the Customs (Prohibited Imports) Regulations and the A.C.T. Classification of Publications Ordinance 1983 in relation to videotapes and videodiscs and in particular- (a) the effectiveness of such legislation to adequately control the importation , production, reproduction, sale and hire of violent, pornographic or otherwise obscene material; (b) whether the present classification system, as applied by the Film Censorship Board, is adequate as a basis for import and point of sale controls; (c) whether video retailers are observing the conditions of sale or hire attached to classified material, particularly in relation to children under 18 years; (d) whether Regulation 4A of the Customs (Prohibited Imports) Regulation is adequate in identifying categories of prohibited material, and operating effectively in preventing the importation of videotapes/discs falling within the prohibited categories; (e) examine the extent to which video tapes and discs containing pornographic and violent material are available to the community in general; (f) whether children under the age of 18 years are gaining access to videotapes /discs containing violent pornographic or otherwise obscene material; (g) whether the A.C.T. Classification of Publications Ordinance 1983 should be amended to make it an offence for persons purchasing or hiring 'X' classified videotapes/discs to allow, suffer or negligently permit children to view such material; (h) whether cinemas should be permitted to screen for public exhibition 'X' classified material, subject to prohibition from entry of persons under the age of 18 years; (j) whether films which would merit an 'X' classification are being produced in Australia and if so whether Australian men and women are adequately protected by existing law from pressure to act in such films; and (k) the likely effects upon people, especially children, of exposure to violent , pornographic or otherwise obscene material. (2) That the Committee consist of six Senators, as follows: (a) three to be nominated by the Leader of the Government in the Senate (b) two to be nominated by the Leader of the Opposition in the Senate; and (c) one Independent Senator, to be nominated by the Independent Senator. (3) That the Committee proceed to the despatch of business notwithstanding that all members have not been duly nominated and appointed and notwithstanding any vacancy. (4) That the Committee elect as Chairman one of the members nominated by the Leader of the Government. (5) That the Chairman of the Committee may, from time to time, appoint another member of the Committee to be the Deputy-Chairman of the Committee, and that the member so appointed act as Chairman of the Committee at any time when there is no Chairman or the Chairman is not present at a meeting of the Committee. Select Committee on Video Censorship Select Committee on Video Censorship (6) That, in the event of an equality of voting, the Chairman, or the Deputy- Chairman when acting as Chairman, have a casting vote. (7) That the quorum of the Committee be three members. (8) That the Committee and any sub-committee have power to send for and examine persons, papers and records, to move from place to place, to sit in public or in private, notwithstanding any prorogation of the Parliament or dissolution of the House of Representatives, and have leave to report from time to time its proceedings and the evidence taken and such interim recommendations as it may deem fit. (9) That the Committee have power to appoint sub-committees consisting of three or more of its members, and to refer to any such sub-committee any of the matters which the Committee is empowered to consider, and that the quorum of a sub-committee be a majority of the Senators appointed to the sub-committee. (10) That the Committee be provided with all necessary staff, facilities and resources and be empowered to appoint persons with specialist knowledge for the purposes of the Committee with the approval of the President. (11) That the Committee be empowered to print from day to day such papers and evidence as may be ordered by it, and a daily Hansard be published of such proceedings as take place in public. (12) That the Committee report to the Senate by 31 March 1984. (13) That, if the Senate be not sitting when the Committee has completed its report, the Committee may send its report to the President of the Senate or, if the President is not available, to the Deputy-President, who is authorised to give directions for its printing and circulation and, in such event, the President or Deputy-President lay the report upon the Table at the next sitting of the senate. (14) That the foregoing provisions of this Resolution, so far as they are inconsistent with the Standing Orders, have effect notwithstanding anything contained in the Standing Orders. [COGNATE BILLS: BANK ACCOUNT DEBITS TAX ADMINISTRATION AMENDMENT BILL 1984 BANK ACCOUNT DEBITS TAX AMENDMENT BILL 1984] Debate resumed. Senator WALSH(Western Australia-Minister for Resources and Energy)(6.51) —I had almost finished speaking in the cognate debate on these taxation Bills before the suspension of the sitting for lunch. I wish to make only one other comment and that is in relation to Senator Jack Evans's suggestion that in order to overcome the resistance in the Senate to the passage of tax Bills which have retrospective clauses, he put what I think he called a challenge to the Government to call a double dissolution of the Parliament on those Bills. I shall pass that suggestion on to the Prime Minister (Mr Hawke) and seek his reaction to it. But I note for the record that one of the consequences of the Government's doing that is of course that it would be easier for Australian Democrat senators to be re-elected in a double dissolution than under a half Senate election. I thank the Senate for the indicated support by everybody for the passage of the Bills. Question resolved in the affirmative. Bills read a second time. The Bills. Senator COLSTON(Queensland)(6.53) —I wish to address my remarks to certain clauses in the Medicare Levy Bill 1984. Earlier today Senator Boswell informed the Senate that he would outline Queensland's view of Medicare funding. Senator Boswell was being less than honest. What he was outlining was the Queensland National Party's view of Medicare funding which in no way can be taken to represent the views of the Queensland people. I intend to outline factors which indicate that Queensland has been well treated by the Hawke Labor Government. I also mention that in the course of his convoluted remarks Senator Boswell made a statement that I never do anything for Queensland. That is a measure of the nonsense that Senator Boswell brings into this place. I dare say that on most days before Senator Boswell rises I achieve more for the State that I represent than he does in the rest of the day. But I will leave Senator Boswell's churlish remarks and return to the important area of Medicare funding. Queensland is reimbursed under Medicare on the same basis as all other States, that is, on a reimbursement basis. In addition, Queensland, and Queensland alone , receives a special grant of $35m per annum. The Queensland Government has persistently claimed that under Medicare it is disadvantaged on a per capita basis compared with other States. This is the approach that Senator Boswell used today. This approach is a spurious one. I will outline two basic facts about Medicare reimbursement to the States. Firstly, Medicare funding is unrelated to per capita funding. Therefore the per capita argument is at least misleading if not irrelevant. Secondly, Medicare funding is related to reimbursing each State for revenue it would otherwise have collected by way of hospital charges had Medicare not been introduced. Thus, in simple terms, the more revenue a State forgoes, the more it is reimbursed in dollar terms. In overall terms Medicare funding is a relatively small component of Commonwealth payments to the States. Nevertheless as the Queensland Government has, for simplistic political purposes, persisted with the irrelevant notion of per capita inequities, it is reasonable to look at the overall per capita position concerning the disbursement of total general tax sharing and significant health related grants to the States. Unfortunately, members of the National Party cite only the amounts that Queensland receives by way of Medicare grants. To make their arguments more attractive they fail to mention funds which come from other sources. I wish to refer to a table for 1984-85 which clearly shows that once again Queensland is more generously treated than the two most populous States. The table is based on data provided by the Australian Bureau of Statistics and is contained in one of the 1984-85 Budget Papers. I showed this table to a front bencher earlier and I now seek leave to have it incorporated in Hansard. Leave granted. The table read as follows- ESTIMATED PAYMENTS FOR 1984-85 BY THE COMMONWEALTH HEALTH RELATED AND TAX SHARING GRANTS N.S.W. Vic. Qld S.A. W.A. Tas. N.T. Total Est. Population Dec. 1983 ('000) 5,378.3 4,053.4 2,488.0 1,347.0 1,373.7 434.7 136.8 15,211.9 Tax Sharing Grants $m 2,693.7 2,013.6 1,890.0 997.1 1,044.6 415. 0 475.0 9,529.0 Health Grants $m 521.4 344.2 104.7 182.3 161.9 58.9 27.2 1,400. 6 Medicare $m 320.0 229.1 79.2 106.2 81.3 29.5 10.2 855.5 Total $m 3,535.1 2,586.9 2,073.9 1,285.6 1,287.8 503.4 512.4 11,785.1 Per capita 657.28 638.20 833.56 954.41 937.46 1,158.04 3,745.61 774.72 Source: Australian Bureau of Statistics. Payments to or for the States, the Northern Territory and local government authorities. 1984-85 Budget Paper No. 7. Senator COLSTON —The table indicates that if we take into account tax sharing grants, health grants and Medicare grants to the States the per capita amount received by New South Wales is $657, by Victoria $638 and by Queensland $833. Although Queensland receives a lesser amount per capita than South Australia, Western Australia, Tasmania or the Northern Territory, it does receive an amount greater than the average per capita for the whole of Australia. This indicates that Queensland is not poorly done by when one looks at all funding that goes to that State. Queensland is owed nothing under the Medicare arrangements. The Queensland Premier signed the agreement and by doing so accepted the basis on which Queensland Medicare funding would be calculated. In cash terms Queensland receives monthly advances in the same way as every other State. The Commonwealth agreed that the Commonwealth Grants Commission would consider the Queensland position under Medicare relative to other States as a special reference within its 1985 review of tax sharing relativities. The Grants Commission is expected to report on these matters by March 1985. It is a pity that the Queensland National Party Government continues to use an irrelevant argument for cheap political purposes. Queensland has not been short changed by the Government. Senator Boswell and his National Party cronies would do far better to convince the Queensland Government to use the money provided to Queensland to improve the public hospital system in Queensland. Bills agreed to. Bills reported without amendment or requests; report adopted. Bills (on motion by Senator Walsh) read a third time. Consideration resumed from 11 September, on motion by Senator Gareth Evans: That the Bills be now read a first time. Question resolved in the affirmative. Bills read a first time. Senator WALSH(Western Australia-Minister for Resources and Energy)(6.59) —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- BANK ACCOUNT DEBITS TAX ADMINISTRATION AMENDMENT BILL 1984 The main purpose of this Bill, and a further Bill I will introduce shortly, is to permit three additional exemptions from the bank account debits tax. These exemptions were decided upon by the Government following a review of the tax and were announced by the Treasurer (Mr Keating) in the Budget Speech. A statement outlining the decision taken by the Government as a result of the review was issued by the Treasurer on 22 August 1984. As indicated in that statement, the Government confined its review of the tax to the exemption provisions pending the outcome of an enquiry into the distribution of taxing powers between the Commonwealth and the States. Honourable senators will be aware of the numerous organisations and individuals who have made representations seeking exemptions from the tax in recent months. Those representations were given very careful consideration by the Government and it was concluded that it would be appropriate to grant three additional exemptions. The Government believes that the new exemptions will rationalise the existing exemption provisions while at the same time retain the original concept of a broad-based tax with few exemptions. The present Bill will grant two new exemptions. First, it will extend the range of exemptions to include parents and citizens' associations and other support groups for institutions that are themselves exempt from the tax. Secondly, it will exempt local councils and government bodies in respect of any minor business activities they carry on. In addition, the Bill will clarify the operation of the legislation in relation to government bodies whose enabling legislation includes a provision generally exempting the body from Commonwealth taxes. The Bill will also modify requirements relating to the lodgment with the Australian Taxation Office of certain returns by banks. I turn now to discuss in more detail the changes proposed by this Bill. Under the present law, a public benevolent or religious institution, a public or private non-profit hospital and a government or private non-profit school, college or university is exempt from tax. The Bill proposes that exemption also be granted to organisations whose function is to support one of those exempt institutions. The proposed exemption will thus apply to parents and citizens' associations and like bodies which exist to serve the interests of particular schools. Auxiliaries set up to raise funds for a hospital or a public benevolent institution such as an aged people's home will also be eligible for exemption. Exemption will not, however, extend to 'umbrella' support groups whose purpose is to promote in a more general way the interests of schools, hospitals or other exempt institutions nor to broadly based support groups such as community service clubs. The new exemption will apply to debits made to accounts on or after the first day of the month following the month in which the amending Act receives the royal assent. The Bill also liberalises the exemption currently provided to certain government bodies. Under the present law, government bodies are eligible for exemption from the tax, except in relation to bank account debits resulting from transactions connected with a business undertaking or if their sole or principal function is to carry on a business. This policy of taxing all business activities of government bodies ensures equality of tax treatment with any private sector competitors but has meant that local councils that carry on business activities such as operating swimming pools, child care centres and caravan parks are subject to the tax in respect of those activities even where they represent an insignificant part of a council's functions and are not commercial in a real sense. Because transactions relating to such business activities are generally conducted through the council's main operating bank account, that account is not eligible for the issue of a certificate of exemption. Instead, the council is initially required to pay tax on all debits to the account and subsequently claim a refund from the Commissioner of Taxation of the tax paid on the non-business debits. The Government believes that the administrative burden in these particular situations is disproportionate to the very small amount of revenue involved. Accordingly, the Bill will extend the scope of the exemption provided to government bodies that do not primarily carry on business undertakings so that such a government body will be eligible for exemption not only in respect of its non-business activities but also in respect of any business activities that form a minor or insignificant part of its functions. This will mean, for example, that a local council will no longer be subject to the tax in respect of business activities such as operating a swimming pool where, viewed overall, that activity represents a minor part of the council's functions. On the other hand, a council that carries on, for example, a substantial electricity supply undertaking will not be eligible for exemption in respect of debits relating to that activity. The change to the exemption arrangements for government bodies will also operate in relation to debits made on or after the first day of the month following the month in which the amending Act receives the royal assent. This Bill is also to clarify the operation of the bank account debits tax law in relation to government bodies whose enabling legislation includes a provision exempting them from Commonwealth taxes. The intended operation of the existing law is that government bodies are entitled to exemption from the tax only if they satisfy the specific tests for exemption of government bodies contained within the bank account debits tax legislation. As mentioned earlier, those tests are designed to ensure that government bodies are not eligible for exemption in respect of substantial business activities. Nevertheless, legal arguments have been advanced that government bodies that carry on substantial business undertakings are completely exempt from the bank account debits tax if they have a general tax exemption provision in their enabling legislation. The amendments will make it clear that a government body will only be entitled to exemption from the tax if it satisfies the specific tests for exemption of government bodies contained in the bank account debits tax legislation. This particular measure will be made effective in relation to bank account debits occurring on or after 22 August 1984 which was the date on which the Treasurer announced that the law would be amended in this way. The final measure proposed by this Bill will vary a machinery provision in the existing legislation which stipulates that banks must lodge an annual return relating to exempt accounts specifying the names and addresses of the account holders in alphabetical order. The Bill will replace the requirement to furnish a list of account holders in alphabetical order with a requirement that the bank furnish the return in an approved form containing such particulars as are required by the form. This is consistent with the existing provision relating to lodgment of returns for taxable accounts and will assist the Commissioner of Taxation in exercising appropriate control over the system of certificates of exemption. As is usual with amendments to the taxation laws, an explanatory memorandum giving technical details of the amendments contained in the Bill is being circulated to honourable senators. I commend the Bill to the Senate. BANK ACCOUNT DEBITS TAX AMENDMENT BILL 1984 This Bill will give effect to the proposals announced in the Budget Speech to exempt debits below $1 from the bank account debits tax and to increase the tax on debits of $10,000 or more from $1 to $1.50. At present, there is no minimum debit below which the tax does not apply. This means that the minimum rate of tax of 10c is charged on very small debits including on small debits for financial institutions duties levied by some States. The Bill will ensure that debits below $1 are not subject to bank account debits tax. In order to offset the cost of the exemption of debits below $1 and the other new exemptions announced in the Budget, the Bill proposes to increase the rate of tax on debits of $10,000 or more from $1 to $1.50. This increase, like those two changes, will apply to debits made to accounts in the month following royal assent. I commend the Bill to the Senate. Question resolved in the affirmative. Bills read a second time, and passed through their remaining stages without amendment or debate. The DEPUTY PRESIDENT —It being after 7 p.m., under sessional order, I put the question: That the Senate do now adjourn. Senator CROWLEY(South Australia)(7.01) —I wish, on the adjournment debate, to draw the attention of the Senate to a letter that I received from the Leader of the Opposition, Andrew Peacock. Mr Peacock's letter invites me to consider the following important matters. He challenges me to appreciate that unlike Australian Labor Party politicians he does not have to take instructions from 99 men and women delegates to the Labor Federal Conference, but he adds that he is prepared to listen to 'you', meaning in this case anyone who reads the letter. He adds further that he wants those of us who get to read this letter to support him on a 'very important project'. He wants our personal views on several critical issues. He goes on to say that he has a Strategy Committee that has prepared a 'Special Critical Issues Survey', and he adds: Because I believe you are a person who shares an interest and concern in these matters, I would particularly value your response. He adds further, with great insight: Over the last seventeen months since we lost government, my colleagues and I have been working quietly developing new Liberal initiatives. Now, this is your opportunity to add your personal views to this process. What I find very interesting is that there is no opportunity for people, when they fill in the enclosed questionnaire to decide what are the critical issues. These have been chosen by the Strategy Committee. Honourable senators will be pleased and surprised to know that the critical issues include Medicare, Taxation and Income Support and General, which includes things such as the attitudes to migration in this country, to a secret intelligence organisation, to a prices and incomes accord that addresses the issue of whether union leaders should have a say or an ability to have a say in Federal Government-whether we should change the Australian flag and what we think of the wine tax. I suppose that is a list of critical issues, but I find it quite interesting that nowhere is there mentioned the question of employment, the question of the need to reduce the deficit, the question of addressing the problems created by inflation , or any acknowledgment for instance that inflation has fallen- Senator Giles —Or housing. Senator CROWLEY —And certainly no question addressing housing; I thank Senator Giles for that addition to the list. Social security is reduced to very few items. I am also interested to note that the questionnaire is, I think one could say, designed in a loaded way. Question 1 states: On 1 February 1984 the Hawke Labor Government introduced a new health insurance scheme, Medicare. This scheme involves a compulsory levy of 1% on all income in addition to the costs to those who wish to continue with private insurance. Do you consider that you and your family are better off under these new arrangements? I would not have thought it a matter of consideration; I would have thought it a matter of fact. Of course that fact depends on whether people choose to be in Medicare or whether they choose to add private insurance to that Medicare levy as well. The next series of questions I think are all loaded in the same way. One could only say about this questionnaire that it rather leads the readers. I will not go through all the questions, but I think there are some that are not going to give Mr Peacock much satisfaction, although he may get some very interesting little figures from his computer when all these things are analysed. The last question that really fascinated me, and which is only for those, of course, who have become special contributors by donating money as well as their answers, states: Do you believe Andrew Peacock should launch an advertising campaign to bring these critical issues you have nominated to the attention of the people of Australia? In fact the people do not nominate the issues as they have been nominated for them. I would have thought it was rather curious of Mr Peacock to wonder whether he should advertise his interest in these things, particularly as he claims in the letter to be the Leader of the Liberal Opposition. Presumably leaders of the Opposition do advertise from time to time about matters of concern. I find it such an interesting letter that I think it worthy of bringing to the attention of the Senate, particularly the direction on the envelope which says that when I have filled in this questionnaire I might send it all back to the Strategy Committee. I can only say that if the Strategy Committee of the Liberal Party is dependent on the responses from people on issues such as these, the Liberal Opposition I am sure is bound to remain in opposition. Senator MARTIN(Queensland)(7.05) —I have listened to Senator Crowley's contribution and since Ministers respond only to Opposition senators in this place, I just make the response that I am sure the comments she has put on the record will be fed into the computer and be widely at variance with the other results. I rise today to raise a matter that I raised during Question Time yesterday and to put on the record my concern about the Government's intention in relation to one of the Bills listed for debate. Mr Deputy President, I hasten to assure you that I am not going to canvass the subject matter of the Bills but just outline the progress of them and indicate my concern about them. Yesterday in Question Time I asked the Manager of Government Business in the Senate, Senator Grimes, what the Government's intention was with respect to the Australian Citizenship Amendment Bill 1984, and whether he would, on behalf of the Government, give an undertaking that the Senate will be given an opportunity to complete its debate and to vote on the Bill before the Parliament rises prior to the next Federal election. Senator Grimes replied: The answer is yes. I hope that debate on the Bill will be resumed this week. It depends, of course, on what other activities- I interjected and said: It is not listed. Which was true. It was not on our list of Bills for debate for this week. Senator Grimes then resumed: I am sorry. I can give the honourable senator an absolute guarantee that, unless something catastrophic happens and a bomb falls on the place, the Bill will be debated. It is my intention at the moment that it will be debated this week. The history of this Bill is that on 2 May 1984 it received its third reading in the House of Representatives. The Senate resumed the second reading debate on it on 9 May. We debated it for a couple of hours until the second reading debate was adjourned, as I recall, around five in the afternoon. Since I have a particular responsibility on behalf of the Opposition for that Bill I have had a very close interest in the resumption of debate on it. However, five months have now passed without any resumption of debate or any indication of a resumption of debate. Towards the end of the last parliamentary session I was constantly asking my Whip and scanning the lists of Bills to see whether it was one that was likely to come up. In the end it ended up with a bunch of Bills that were held over from the autumn session to the Budget session-a rather small list of Bills. I was personally disappointed because I thought it was a matter that we could resolve through debate that session because we were a bit light on business on more than one occasion. My reason for asking that question yesterday was obviously to find out whether it was going to be debated because I have to spend some time in the Senate when it is debated, but also because I was interested in ascertaining what priority the Government gave to the passage of this Bill. The Minister for Immigration and Ethnic Affairs, Mr West, has described the Bill in these terms: It is the most significant piece of amending citizenship legislation since 1949 . The process for amendment of this Bill was, of course, commenced in 1982. The Opposition agrees that it is a most significant Bill, but given that it is so significant, that raises further query on why there has been a delay. I remind the Senate of Senator Grimes's reply to my question yesterday, that it was his intention that the debate should be resumed this week. This morning I received a document from my Whip. I believe quite a number of honourable senators now have this document which is headed 'Bills for Passage-Budget Sittings 1984 (not necessarily in order of consideration)'. There are four lists of Bills. There are Bills under the heading 'Essential Budget Legislation'. The second list is 'Essential Legislation'; the third is 'Highly Desirable Legislation'; and the fourth is 'Legislation for Passage if time permits', that is, the Bills that will slide away if Parliament is dissolved before they are debated. It is on that fourth list, the lowest priority list, that the Australia Citizenship Amendment Bill appears, together with the related Aliens Act Repeal Bill. So the Government in fact gives debate on this Bill no priority at all. That is in some contrast to the statement by the Manager of Government Business yesterday. I inquired of our Whip when he received this document and he told me that it was today, 3 October, that he received it from the Parliamentary Liaison Officer . The document itself is dated 2 October, that is yesterday, so this list existed some time yesterday when Senator Grimes was saying that it was his firm intention, barring bomb attacks on Parliament House, to have the Bill debated. That is a very real mistake on the part of the Government, but that is its business. I believe that there is no need for delay. The Bill is a major one and it makes very significant changes on the matter of Australian citizenship. There is major consensus on this Bill. The Opposition has only three points of difference with the Government relating to matters which I will not canvass now. However, I would point out that when we got some little way into the second reading debate on 9 May, Senator Chipp, speaking on behalf of the Australian Democrats, indicated that the Democrats would support one of the three Opposition amendments, the one which would prevent the removal of reference to the Queen from the oath or affirmation of allegiance. In other words, when we reach a vote in the Committee stage on that aspect, the Liberal, National Party and Democrat senators will defeat the Government's intention to remove from the oath or affirmation of allegiance reference to allegiance to Her Majesty the Queen. I rest my case. Senator MISSEN(Victoria)(7.13) —Tonight I bring to the attention of the Senate and I hope to members of the National Crime Authority some errors in their understanding of their powers which it is important should be brought forward. I refer particularly to an article which appeared in this afternoon's edition of the Melbourne Herald. It is the third in a series of articles by Peter Game in relation to the problems of the National Crime Authority, and it consists mainly of interviews with the three members of the Authority, Mr Justice Stewart, Mr John Dwyer and Mr Max Bingham. The quotations in that article indicate that there is a considerable misunderstanding by those members of the problems which face them and of the ways in which they may well be frustrated. It is the concern of this Parliament that we should know these problems. In this afternoon's article there are quotations from statements made first by Mr Justice Stewart in regard to the powers of the Authority and the way in which it may be able to bring to public attention areas where it has been frustrated. Mr Justice Stewart said this: We have made it absolutely clear that we are not the lackeys of any government. We are independent and we intend to remain independent. I greatly applaud those sentiments and I hope that members of the Authority will be in a position to remain independent. Insofar as the Act is deficient, and the Senate well knows that I believe it to be extremely deficient, I hope that it will be changed so that the members will be able to maintain their independence. The article went on to say: Nonetheless, the commissioners already have sought an amendment to their Act which could have the effect of making political interference less likely-they want the legislation changed to compel the Inter Governmental Committee (IGC) to give reasons when it vetoes a particular investigation. As the Senate will recall, under this ramshackle Act that the members of the Authority are saddled with, they can only investigate in the same way as any of us can until they can convince this Inter-Governmental Committee that they need coercive powers to call witnesses and get documents. If the committee agrees and gives them that reference, they have the power. They want the legislation changed so that the committee must give reasons when it vetoes any reference. But the reasons are of little use, unfortunately, if they are not on the public record. Mr Justice Stewart said that he wanted to ensure that the Inter- Governmental Committee's reasons for veto were on the record. It is no good their being on the record if the public does not know about them and these matters cannot be disclosed. This is where the members have been misled. I refer to the statements made by Mr Bingham in the same article. He said: It is true that there is a right to veto that any jurisdiction (minister) on the IGC can exercise if it doesn't want a particular topic examined. But I think it is important to realise that if that happens we have a couple of courses open to us. Most important, we have power under the Act to hold a public hearing for the purpose of informing the public about matters of public interest. We would take the view very strongly that if we asked for a reference on grounds that we thought were appropriate and it was refused, we would use a public hearing to let it be known that it had occurred. I very much applaud those sentiments, but unfortunately Mr Bingham has misread his Act. He has not realised the type of restrictions that are imposed in that Act. It appears clearly that further amendments will be required. Before turning to the Act and showing what is wrong there, I mention that Mr Justice Stewart had last week, on 27 September 1984, as reported in the Australian, referred in very strong terms to the warning that members of the Authority would not be lackeys. That article said: The judge warned the Authority may hold public sessions to announce any refusal by the inter-governmental committee controlling the Authority to make references to it allowing upgraded crime investigations. The statement is a strong endorsement of the stand by the Prime Minister, Mr Hawke, in refuting Opposition charges that the Authority is 'a toothless tiger'. The Deputy Opposition Leader, Mr Howard, reacted by describing the judge's statement as 'gratuitous'. I think that was a very generous description on the part of Mr Howard because as well as being gratuitous the statement also happens to be quite wrong and quite mistaken. I wish to demonstrate just how toothless this tiger unfortunately is. It is wrong that we should hide the fact that this is so. If one looks at the terms of the Act and bears in mind that two members of the Authority think that the public hearing clause will overcome this problem, one sees that this is not so. The public sittings provision, which was put in as a sop to the Senate Standing Committee on Constitutional and Legal Affairs-it was a rather weak suggestion by the Senate Committee which hoped that it would appear to be useful -merely entitles the Authority under section 60 (1) to hold sittings in public ' for the purpose of informing the public or receiving submission in relation to the general conduct of its operations'. It is, as it were, a public relations function. If one looks at sub-section (5) one sees the real problem. Sub-section (5) says: The Authority shall not- (a) divulge in the course of a sitting held under sub-section (1); or (b) include in a bulletin published under sub-section (4), any matter the disclosure of which to members of the public could prejudice the safety or reputation of a person or prejudice the fair trial of a person who has been or may be charged with an offence. So anything that the Authority might want to disclose that might damage the reputation of 'a person', any person, cannot be divulged. It is hard to imagine any reference sought by the Authority that would not damage some person. It is obviously directed against the activities of certain persons. When one turns to section 61, the annual report provisions, which is the opportunity that the Authority might have to disclose information and perhaps to disclose the refusal of permission to embark upon an inquiry, one finds this in sub-section (5). Where the Inter-Governmental Committee resolves that the inclusion in a report by the Authority under this section of particulars of the outcome of a request made by the Authority under sub-section 10 (1)-- that is the sub-section relating to an application for a reference-- might prejudice the safety or reputation of a person, the operations of law enforcement agencies or the fair trial of a person who has been or may be charged with an offence, the Authority shall not include in such a report particulars of the outcome of the request. In other words, the Inter-Governmental Committee always has the power to refuse in those wide terms any reportage of the fact that the Authority has been refused permission to embark on that inquiry. The real ability for the public of Australia to know the way the Authority has been frustrated is not there. That is one of the major reasons for my minority Committee report. The Opposition adopted it almost in full and moved amendments which if carried, would have taken away most of these problems. In my opinion one of the features of this matter is the lack of publicity given to the power of that Inter-Governmental Committee to suppress knowledge of what it has done. I refer to comments made by the head of the Authority in a report in the Age of 27 September. It is a report of the same Press conference I quoted from the Australian. The report states: Mr Justice Stewart said that he would seek extra powers . . . 'if with experience, we find that our powers are lacking in a particular area'. I am saying that they are clearly lacking in a particular area. I do not say this in criticism of the new members of the Authority but it is necessary for this Parliament to set up the Joint Committee on the National Crime Authority which the Government has delayed, so it can assist in seeing that changes are made so that the Authority acts effectively. It is no good Mr Justice Stewart saying, as he did at the Press conference reported in the Age: Let me assure you that nobody is going to tell us what to do. We'll pursue the people and the crimes that we see, don't worry about that. I admire his hopes and intentions but I am saying that it ought to be clear to the Australian public and to the members of the Authority that deadly deficiencies are already coming forward and they will, as they unfold and if unchanged, regrettably lead to the proof of the muzzling of this Authority. I draw these matters to the attention of the Senate as a result of the article which appeared today in the Melbourne Herald which is so defective in this regard. I hope we will have greater concern, and the people of Australia will have greater concern, to see that the wool is not pulled over our eyes by the Government which endeavours all the time to suggest that it has given sufficient powers to the Authority. It has not. The Costigan Royal Commission of Inquiry on the Activities of the Federated Ship Painters and Dockers Union is to be passed away, inadequate powers are to be given to the Authority and muzzling powers are to be given to an Inter-Governmental Committee. This must constantly be drawn to the attention of the public of Australia. Senator GRIMES(Tasmania-Minister for Social Security)(7.23) —I do not feel competent at the moment to reply to matters raised by Senator Missen but I will refer them to the Attorney-General, Senator Evans. Senator Missen —Who was advised that I would make the speech. Senator GRIMES —I am sorry about that. He is not here but Senator Missen knows that Ministers cannot always be here. Unfortunately I was unable to hear Senator Crowley's contribution. Senator Martin —You did not miss a thing. Senator GRIMES —I am afraid we can say much the same thing about Senator Martin' s contribution. I gather the gist of her problem is that I said yesterday that the Citizenship Amendment Bill would be debated this session. Senator Martin —This week. Senator GRIMES —I hope it will be this week. In fact, it is listed for Friday on the list given to the Opposition Whip. The only problem is that with the shenanigans that have gone on in this place in the last couple of days we have not even got through the legislation we expected to get through by today. However, the simple facts of the matter are that yesterday I said in Question Time that at the request of the Minister for Immigration and Ethnic Affairs (Mr West) the Citizenship Amendment Bill had been put down for debate and passage this week, if possible, but certainly in this session. It would be our desire, and I hope it would be the desire of Senator Martin and her colleagues, that the Bill not only go through this place but also, if it is amended, be dealt with by the other place as well. I will be interested to see whether members of the Opposition assist in the expedition of this Bill when it comes up for debate. I still hope that it will come up for debate on Friday. I cannot guarantee that, not because I do not want it to be debated on Friday but because of the difficulty in getting legislation through this place because of, for example, the bringing on of matters of public importance. I think even Senator Martin would realise that any government would like to see its Budget legislation through first. It is the intention of the Government and the urgent desire of the Minister for Immigration and Ethnic Affairs that the Citizenship Amendment Bill go through in enough time so that, if necessary, it can go back to the House of Representatives and so be dealt with not only by the Senate but also by the Parliament. I do not lightly answer questions in the way I answered them yesterday. We do not lightly give lists of business to the Opposition Whip. The list put out which suggested that the Bill was not so essential had not been amended following a meeting of the Cabinet, and the Government, yesterday morning. I say again that it is our intention to debate that legislation, to get it through this place and to get it through the Parliament even if it has to go back to the other place. That is our intention and I repeat that if it is really the intention of members of the Opposition that that be so, I hope that they will assist in such a passage. Let us not have 10 rhetorical speeches full of hyperbole and the other stuff we are likely to get, because nobody can expect us not to want to get essential Budget legislation through. We want to get the Bill through, and I hope we can get it through with the co-operation of the Opposition. Question resolved in the affirmative. Senate adjourned at 7.27 p.m. The following answers to questions were circulated: (Question No. 784) Senator Reid asked the Minister representing the Minister for Health, upon notice, on 30 March 1984: What is the cost per resident in Bruce Hostel for services provided in the following expense categories: (1) wages for (a) nursing; (b) non-nursing; (c) administration; (d) domestic; ( e) cleaning; (f) staff development; (g) professional medical services; (h) paramedical services; and (i) transport; (2) maintenance and electricity; (3) food and consumables (4) equipment (buses, aid, appliances); and (5) Capital Territory administration overheads. Senator Grimes —The Minister for Health has provided the following answer to the honourable senator's question: The following information relates to the costs for the 1983-84 financial year: (1) (a) $15,000; (b) $15,200; (c) $1,500; (d) $1,600; (e) $2,550; (f) Nil. See (5) below); (g) $130; (h) $1,160; (i) Nil. See (5) below. (2) $980 (3) $2,200 (4) $210 (5) Capital Territory Health Commission overheads in respect of the hostel include services provided by the Commission's laundry service, maintenance section, transport section, personnel section, finance section and the Mental Health Branch. Because these services are also provided to other facilities and areas of the Commission it is not possible to satisfactorily identify the costs of the services to the hostel. (Question No. 999) Senator Peter Rae asked the Minister for Industry and Commerce, upon notice, on 22 August 1984: (1) Does the Minister for Industry and Commerce's answer to Question No. 896 state that- In the administration of anti-dumping action the Government's rights and obligations are determined inter alia by the GATT Anti-Dumping Code. Article 10 of that Code provides that provisional measures shall not be applied until there is a preliminary finding of injury and unless the authorities concerned judge that they are necessary to prevent injury being caused during the period of investigation. (2) Has the Department of Industry and Commerce found that outboard motors have been dumped in Australia and are causing material injury as stated in ACN 84/96? (3) Why haven't dumping duties been imposed when dumping is taking place and is causing material injury and the GATT Code allows anti-dumping action to take place? Senator Button —The answer to the honourable senator's question is as follows: (1) Yes. (2) and (3) In accordance with the provisions of Article 6 of the GATT Anti- Dumping Code, the Department has held a meeting of all directly interested parties and has heard opposing views and rebuttal arguments. Further submissions by interested parties have been lodged with the Department since the meeting. Additionally detailed overseas inquiries are being conducted. An assessment of information currently available to the Department indicates that outboard motors have been exported from the United States of America to Australia at export prices less than the normal values. However inquiries have not yet been finalised due to the need to resolve several complex issues raised by interested parties. Provisional measures were not imposed at the time of the preliminary finding but it was stated that imports would be monitored and appropriate action taken in response to changes in import patterns to prevent material injury being caused during the period of investigation. Recently as a result of its monitoring activity, the Department reached the view that material injury is threatened to the Australian industry by imports of outboard motors from the United States of America now on forward order for delivery during the stock build-up period of October to December, prior to the peak summer selling season. Accordingly provisional measures were imposed on imports of outboard motors from the United States of America entered for home consumption after 24 September 1984. These measures took the form of cash securities or documentary securities with surety at the option of the importer. (Question No. 1036) Senator Macklin asked the Minister representing the Minister for Defence, upon notice, on 21 August 1984: (1) Is the Army currently carrying out tests to select a replacement for the FN rifle. (2) When will these tests be completed. (3) What are the criteria used by the Army to evaluate the suitability of rifles tested. (4) Is a report in the Sunshine Coast Daily (Friday 29th July 1984) claiming the Defence Department has refused to test a 7.62 calibre rifle developed by a Mooloolah man true; if so, why did the Defence Department refuse to test the rifle and what criteria were used to make the decision. (5) Who was responsible for the decision not to test the rifle. (6) Is the Minister for Defence confident that the decision not to test this rifle is correct. (7) Have any other similar decisions not to test other rifles ever been made; if so, what are the details of these. (8) Will a report on the rifles tested be released when the tests are completed ; if so, will this report give in full the details of why this Australian- developed 7.62 rifle was not tested. Senator Gareth Evans —The Minister for Defence has provided the following answer to the honourable senator's question: (1) The Army is conducting an evaluation of two 5.56mm rifles, one of which will replace the 7.62mm L1A1 rifle. (2) This evaluation will be completed in March 1985. Source selection is planned for mid 1985. (3) The main criteria used by the Army to evaluate the suitability of rifles tested were that the rifles must be of 5.56mm calibre and also capable of firing the SS109 type ammunition system. In addition other criteria relating to dimension, handling, rate of fire, weight, weapon performance, reliability etc will influence the final choice. The required performance characteristics of the future 5.56mm weapon were established as a result of a comprehensive Army study. (4) It is understood the Mooloolah man referred to was a Mr Doring. The decision not to test Mr Doring's 7.62mm calibre rifle was due to it not being offered in response to invitations to tender for the supply of evaluation weapons. In any event Mr Doring's weapon is of a different calibre from that which for operational reasons has been determined by the Army as the most suitable for the future Army individual weapon, ie., 5.56mm. Improvements in 5. 56mm calibre ammunition technology, weapon design and manufacturing techniques offer a significant reduction in weapon and ammunition weight when compared with 7.62mm weapons. These advantages are achieved without detriment to the lethality or effective range provided by previous 7.62mm rifles. (5) The decision not to test the rifle was made by the Army Project Office for the reasons stated above. (6) The Minister has no reason to doubt the validity of the decision not to test the 7.62mm rifle offered. (7) Tenders for the supply of rifles for evaluation were restricted to 5.56mm calibre. Tenders were advertised nationwide in all major newspapers on 6 April 1983 and closed 26 July 1983. Details of rejected tenders are 'Commercial in Confidence' and are not released. (8) The trial report will be classified 'Commercial in Confidence' and will not be available for general distribution. Content of this report will be restricted to the two 5.56mm rifles under consideration. (Question No. 1048) Senator Jones asked the Minister representing the Minister for Primary Industry , upon notice, on 23 August 1984: (1) Is the Minister for Primary Industry aware of a predilection for goat meat in South East Asian countries. (2) Has Australia tapped this potentially lucrative market; if so, what is the annual value of goat meat exports to Australian producers, and, if not, why not. Senator Walsh —The Minister for Primary Industry has provided the following answer to the honourable senator's question: (1) Yes, I am aware that South-East Asian consumers have a definite requirement for goat meat, especially for consumption during festivals. (2) Australia has developed a small but profitable market for goat meat in the South-East Asian countries of Hong Kong, Malaysia, Singapore and Taiwan. In 1983 -84, 31 per cent of Australian goat meat exports were shipped to these countries at a value of $1.6m. Total goat meat exports were valued at $3.0m. As the honourable senator will be aware, the goat meat industry in Australia is small compared with our beef and sheep meat industries. I understand, however, that in recent years there has been increased interest in the production of goats and this could result in an increased availability of goat meat for export . (Question No. 1049) Senator Jones asked the Minister for Industry and Commerce, upon notice, on 23 August 1984: (1) Is the Minister for Industry and Commerce aware that many Australian overseas travellers are striking difficulty interpreting Australian Customs forms. (2) Will the Minister undertake to have officers of his department simplify the wording of Australian Customs forms to avoid embarrassment by innocent well- meaning travellers returning from abroad. Senator Button —The answer to the honourable senator's question is as follows: (1) No. (2) Officers of the Australian Customs Service regularly review the content of Australian Customs forms as well as the literature that is supplied through airlines, shipping companies and travel agencies to inform travellers of Customs requirements. (Question No. 1065) Senator Childs asked the Minister for Resources and Energy, upon notice, on 24 August 1984: Will the Minister for Resources and Energy, following the statement in the Report of the Committee established to examine an accidental release of uranium hexafluoride at the Australian Atomic Energy Commission (AAEC) Research Establishment that: 'In hindsight it is clear that more attention should have been given to the desirability of an early press release by the AAEC to prevent information on the incident being subsequently exaggerated and public anxiety being caused unnecessarily', institute a system of automatic, detailed media releases on any incidents at Lucas Heights. Senator Walsh —The answer to the honourable senator's question is as follows: No. Careful consideration is always given to whether any aspect of the AAEC's day-to-day activities at the Lucas Heights Research Laboratories warrants a public announcement. Following the exaggerated press coverage of the incident on 6 July 1984, the AAEC has been asked to be more sensitive to the need to make a public announcement after an incident, irrespective of its off-site significance , if the incident could lead to concern in the local community and if it warrants reporting to relevant Commonwealth and State authorities. (Question No. 1080) Senator Bolkus asked the Minister representing the Minister for Primary Industry, upon notice, on 24 August 1984: (1) How many word processors, stenographers and typists are employed in the Minister's Department. (2) As of 1 September 1984, how many such staff have been, or are, off work with repetition strain injury or suspected repetition strain injury. Senator Walsh —The Minister for Primary Industry has provided the following answer to the honourable senator's question: (1) 125. (2) 30. (Question No. 1089) Senator Bolkus asked the Minister representing the Minister for Science and Technology, upon notice, on 24 August 1984: (1) How many word processors, stenographers and typists are employed in the Minister's Department. (2) As of 1 September 1984, how many such staff have been, or are, off work with repetition strain injury or suspected repetition strain injury. Senator Ryan —The Minister for Science and Technology has provided the following answer to the honourable senator's question: (1) In respect of the Department of Science and Technology: word processors- forty-six (46); steno-secretaries-forty-eight (48); typists-thirty-three (33); as well there is one clerical assistant who undertakes 50 per cent typing duties . (2) Twenty-seven (27). (Question No. 1102) Senator Kilgariff asked the Minister representing the Minister for Defence, upon notice, on 24 August 1984: (1) Why is the Government cutting back on operational and training flying time for Royal Australian Air Force pilots to such a degree that those pilots now joining squadrons are receiving insufficient flying time to make them proficient in all aspects of operational flying-particularly considering the Government has indicated its support for the construction of new RAAF bases such as Tindal and the acquisition of new aircraft for the RAAF. (2) Will the Government change its attitude to ensure that Australia has a training program able to provide sufficient pilots to adequately crew RAAF aircraft whether it be fighters, bombers or surveillance aircraft for now and the near future. Senator Gareth Evans —The Minister for Defence has provided the following answer to the honourable senator's question: (1) and (2) Despite the assertions by the honourable senator, the planned total RAAF flying hours for 1984-85 is about 8 per cent higher than that achieved in 1983-84 and this will ensure that the RAAF is able to provide sufficient pilots to crew its range of aircraft. (Question No. 1103) Senator Archer asked the Minister for Industry and Commerce, upon notice, on 4 September 1984: (1) Was a footwear quota fraud involving an amount in the order of $6m detected in 1983; if so, have there been investigations and/or charges and/or convictions in relation to the fraud. (2) What statutory penalties are provided for such actions. (3) What penalties, if any, have been imposed. (4) What restrictions or penalties, if any, on future imports will be imposed on those committing these frauds. (5) Do the penalties appropriately meet the profit involved from the alleged frauds. Senator Button —The answer to the honourable senator's question is as follows: (1) Investigations conducted by the Australian Customs Service beginning in 1982 into footwear imported between November 1981 and May 1982, resulted in the finding of alleged evasion of duty. As a result claims totalling approximately $ 6m have been issued. The investigation culminated in Customs prosecutions being commenced against several importers in the Supreme Court of Victoria. (2) The Customs Act now provides penalties for evasion of duty of up to 5 times the amount of duty evaded. (3) The matters have not yet been heard. As such no penalties have yet been imposed. (4) Upon conviction for an offence, a penalty is imposed by the Court. No additional restrictions or penalties are imposed on future importations by the Customs. However the risks to the revenue posed by manipulating imports under quota are well recognised and appropriate counter-measures have been built into Customs System. (5) Penalties of up to 5 times the Customs duty evaded clearly strike at the profits to be made from evasion of duty. (Question No. 1117) Senator Bolkus asked the Minister representing the Minister for Defence, upon notice, on 6 September 1984: (1) In what countries are Australian troops currently providing training or assistance. (2) Under what Federal Government authority are those troops serving. (3) What international agreements or understandings provide for the presence and conditions of Australian troops serving overseas. (4) Are the terms of such arrangements publicly accessible. (5) Does the Minister for Defence agree that such information should be available on the public record. Senator Gareth Evans —The Minister for Defence has provided the following answer to the honourable senator's question: (1) Australian Service personnel are providing training or assistance under the Defence Cooperation Program (DCP) in Malaysia, Indonesia, Papua New Guinea, Thailand, Singapore, The Philippines, Solomon Islands, Vanuatu, Fiji, Tonga and Kiribati. Australia also maintains a Royal Australian Air Force/Army presence at Butterworth in Malaysia, with periodic RAAF Mirage deployments to Singapore. These units provide training and assistance in the development of the Armed Forces of those countries. (2) With regard to the DCP, Australian Service personnel are posted to provide training or advisory assistance under the authority of the Minister for Defence. In Papua New Guinea, Australian Service personnel are serving in accordance with an undertaking made by the then Prime Minister in January 1977 and which I reaffirmed on behalf of the present Government during my visit to Papua New Guinea in June 1983. The RAAF/Army presence at Butterworth and deployments to Singapore continue under the authority of the Government and the Minister for Defence of the day. (3) In Papua New Guinea, Australian Service personnel serve under conditions laid down in: The Agreement between Australia and Papua New Guinea regarding the Status of Forces of Each State in the Territory of the Other State; and, where appropriate , The Arrangement between Australia and Papua New Guinea on Consultations Regarding the Use of Australian Loan Personnel in Politically Sensitive Situations. The RAAF/Army presence in Malaysia and Singapore is governed by the Exchange of Notes Between Australia and Malaysia and Australia and Singapore of 1 December 1971, under the Five Power Defence Arrangements. These arrangements also cover Australian Service personnel providing training and advisory assistance under the DCP in those countries. In the other countries listed in (1) above, the status of Australian Service personnel providing training and advisory assistance under the DCP is defined in memoranda of understanding between Australia and the country concerned. (4) Where the arrangements have the legal status of international treaties they have been made public. (5) I agree that arrangements having the status of international treaties should be made public. Note: In answering this question, Australian Service personnel serving in peacekeeping forces have not been included as they do not provide training, or assistance in the sense in which the term 'assistance' is generally understood. (Question No. 1131) Senator Kilgariff asked the Minister representing the Minister for Employment and Industrial Relations, upon notice, on 7 September 1984: (1) Is the Minister for Employment and Industrial Relations aware of the News Weekly report of 22 August 1984, detailing the allocation of $413 000 in community employment program (CEP) funds to groups currently blockading the Roxby Downs uranium mine. (2) Are these 'job creation' funds used to provide support to organisations which aim to destroy 18 000 jobs to be generated by the Roxby Downs mine. (3) Does the Minister consider that a misuse of community employment program funds is occurring; if so, what action will the Minister take to ensure that community employment program funds are used for the purposes of job creation and not job destruction. Senator Button —The Minister for Employment and Industrial Relations has provided the following answer to the honourable senator's question: (1) Yes. (2) No. Although a number of groups listed in the article have received CEP funds, any implication that CEP funds have been used to fund the Roxby Downs blockade is incorrect. (3) No. (Question No. 1143) Senator Watson asked the Minister representing the Minister for Science and Technology, upon notice, on 13 September 1984: (1) Will the budgetary allocation of $23.88 million for the Australian research grants scheme only fund 322 new projects out of a total of 1273 applications. (2) Has the Minister been informed that this year will witness the highest termination of grants ever. (3) What action will the Government be taking to minimise, if not prevent from actualising, the very real problem of researchers losing their commitment in the face of constant rejection. Senator Ryan —The Minister for Science and Technology has provided the following answer to the honourable senator's question: (1) The Committee has not yet submitted final recommendations for grants to me. I understand that a total of 1229 grants will be recommended of which 332 are for initial applications and 897 are for renewal applications. There were 1273 new applications and 1037 renewal applications. (2) Yes. (3) There are a number of options open to researchers for obtaining funding other than through the Australian research grants scheme. The ARGS is based on funding excellent research, and the best researchers continue to be funded. However I have asked my Department to consider options for improving the situation. Senator Button —On 13 June 1984 ( Hansard, page 2919) Senator Dame Margaret Guilfoyle asked me, as Minister representing the Minister for Employment and Industrial Relations, the following question without notice: I understand that new guidelines for employment programs were issued last week. As the guidelines have not been released to the public by the Minister, is he able to confirm that, as a general rule, approval will be given to projects involving new employees and not to those funded prior to 30 June? Is it a fact there will be no automatic roll-over of existing programs into the Commonwealth employment programs and that there is wide concern that funding for current programs ceases on 30 June? I understand that all applications for funding will need to be considered in terms of the total program for 1984-85, with consequential gaps in funding until decisions are taken for the approved new projects. Is the Minister able to advise the Senate on these matters, or is any public statement able to be made with regard to funding after 30 June? The Minister for Employment and Industrial Relations has provided the following answer to the honourable senator's question: It is important to recognise that the community employment program (CEP) is a new job creation program and was never intended to be an extension of previous programs by automatically re-funding projects. The wage pause program was structured by the previous Government as a short-term, discrete program to finish on 30 June 1984. In relation to the re-funding of existing job creation projects, the CEP guidelines have always required additional employment to be created on new projects or extensions of existing activities, rather than ongoing operations. The CEP guidelines were not changed but clarified to more fully reflect the Government's intention under the CEP. The clarifications are as follows: there will be no automatic roll-over of existing programs into the CEP any request for further funding of an existing project must be the subject of a new application within the context of the CEP guidelines all applications for CEP funding will be considered as part of a comparative assessment process based on agreed quarterly budgets and rounds of approvals, the CEP guidelines and objectives, other applications, and prioritised by Consultative Committees within the constraint of the funds available for the quarter approval will only be given to projects involving new employees except in circumstances where a participant on a job creation project has received less than 13 weeks' employment. Participants in such circumstances will retain eligibility for CEP placement in circumstances where an application for re-funding is received and assessed while a project is still operational, applications for new projects will have priority over these applications. Administrative decisions relating to the re-funding of projects were issued by my Department on 7 June 1984. There has been wide concern on this issue based on a misunderstanding of the CEP guidelines. Accordingly, I sought to clarify the Government's intentions and on 13 August 1984 I issued a public statement on the re-funding of job creation projects. A major allocation of $410 million was provided for the CEP in the recent Budget. State and Territory Governments have been advised of the CEP funding allocations in 1984-85, and as soon as agreements have been reached between the Commonwealth and State/Territory governments on financial and administrative procedures for this year, the project approval process will get underway.