Tuesday, 26 March 1985 The PRESIDENT (Senator the Hon. Douglas McClelland) took the chair at 2 p.m., and read prayers. The Clerk —Petitions have been lodged for presentation as follows: To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned citizens of the Commonwealth of Australia respectfully showeth: That in the light of the Labor Government's failure to act to correct the anomalies in the Assets Test on pensions bring to its notice and due to have effect from the 21 March, 1985 the Labor Government's legislation should be repealed before it has an unduly unfair impact on pensioners, and calls upon the Australian Democrats to support Senator Messner's bill for the abolition of the Assets Test. Your petitioners most humbly pray that the Senate in Parliament assembled should immediately seek the passage of the Social Security and Repatriation Assets Test Abolition Bill to repeal the Labor Government's iniquitous and unfair Assets Test. And your petitioners as in duty bound will ever pray. by Senators Kilgariff (from 27 citizens) and Messner (from 220 citizens). To the Honourable the President and members of the Senate in Parliament assembled. We the undersigned citizens of the Commonwealth do humbly pray that the Commonwealth Government: 1. Uphold the principle that the seeds and cuttings of plants are a public resource and a common heritage to all and that accordingly seeds should be freely available to all, freely multipliable, able to be sold, exchanged, exported and imported by anyone who wishes. This is seen as a matter of national food security. 2. Recognise that plant breeding is a highly co-operative venture often involving private enterprise at the very last stages after basic seed collection, storage, and research has been publicly funded. 3. In view of the aforementioned paragraphs, recognise that any system giving 'property' or ownership rights over seeds to individuals, organisations or enterprises is inappropriate and unjust. 4. Recognise that legislation establishing plant patenting schemes overseas has had serious adverse effects namely: (i) a slowing-down of scientific information exchange and exchanges in basic plant breeding materials, that is, germ plasm, (ii) subordination and/or curtailment of public breeding programs, (iii) farmer unrest at seed prices, (iv) monopoly control of seed production and sales has passed into the hands of giant petrochemical and drug corporations also marketing crop chemicals, (iv) increased uniformity of crop varieties leading to a vulnerability to pest and disease attack. 5. Reject any proposal to legislate for any system such as the drafted Plant Variety Rights Act, which gives exclusive ownership rights over seeds to individuals, organisations or enterprises. And your petitioners as in duty bound will ever pray. by Senator Zakharov (from 35 citizens). To the Honourable the President and members of the Senate in the Parliament assembled. The petition of the undersigned shows: That we condemn that Australia should assist the United States of America by participating in the testing of MX Peacemaker missiles, or any similar weapons, from Australian shores. Your petitioners request that the Senate, in Parliament assembled, should: 1. Seek to reverse this deplorable decision and, 2. Ensure that Australia's commitment to a nuclear free zone in the South Pacific be maintained. And your petitioners as in duty bound will ever pray. by Senator Reynolds (from 37 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth: That indirect taxes such as sales tax inflate prices, reduce sales, and hence restrict employment opportunities; that land value taxes stimulate the effective use of sites. Your petitioners therefore humbly pray that the Parliament of Australia will carefully consider the desirability of replacing indirect taxes by a land value tax in order to stimulate Australia's economy. And your petitioners as in duty bound will ever pray. by Senator Chipp (from 20 citizens). To the Honourable the President and members of the Senate in Parliament assembled: The petition of the undersigned Australian citizens respectfully showeth that- (i) The financial situation of students enrolled at Australian post-secondary institutions is already extremely difficult and any increase in the financial commitments of students would gravely worsen their financial difficulties. (ii) The imposition of post-secondary tuition fees of comparable levels to those imposed prior to 1971 would force many currently enrolled students to discontinue their studies and may deter many persons willing and able at present to undertake post-secondary study from doing so. (iii) Those students and potential students from social groups currently under-represented and disadvantaged in the education system would be most severely affected by the reintroduction of fees for post-secondary education. Your petitioners therefore pray that: 1. Post-secondary tuition fees not be re-introduced for any category of students. 2. Any form of Stamp Duty or similar system of the 'user pays' principle in education not be introduced. 3. Emphasis should be on increasing access to education by, among other things, increasing student financial assistance. 4. The visa charges upon private overseas students be removed immediately. 5. The Minister for Education and Youth Affairs immediately clarify the government's attitude to the reintroduction of post-secondary tuition fees. And your petitioners as in duty bound will ever pray. by Senator Button (from 219 citizens). Petitions received. Senator MASON(New South Wales) —I give notice that, on the next day of sitting, I shall move: That leave be given to introduce a Bill for an Act to alter the Constitution with respect to the qualification and disqualification of Members of the Parliament and Parliamentary Candidates. Senator GRIMES(Tasmania-Manager of Government Business) —I table papers in accordance with the list circulated to honourable senators. With the concurrence of the Senate, I incorporate the list in Hansard. Leave granted. The list read as follows- 1. Australia-China Council-Annual Report 1983-84. 2. Construction of Additional Administrative Accommodation at the Australian National Gallery-Proposal-Pursuant to section 5 of the Parliament Act 1974. 3. Killings in South Africa-Text of a Statement by the Minister for Foreign Affairs made in the House of Representatives on 22 March 1985. 4. Serving Multicultural Australia-The Role of Broadcasting-Report by the Committee of Review of the Special Broadcasting Service-Parts 1 and 2-Together with Appendixes to the report and Synopsis and Summary of Recommendations. 5. Ringing in the Changes-Telecom's Zonal Charging Policies-Text of a Statement by the Minister for Communications made in the House of Representatives 25 March 1985. 6. Standing Committee on Environment and Conservation-Government Response on the Inquiry into Australia's Participation in Environmental Organisations-Text of a Statement by the Minister for Arts, Heritage and Environment made in the House of Representatives 25 March 1985. Senator BUTTON(Victoria-Leader of the Government in the Senate) —I inform the Senate that the Minister for Resources and Energy, Senator Gareth Evans, will be absent from the chamber today. Any questions which would normally be directed to Senator Evans in relation to his portfolio should be directed to Senator Walsh. Those questions relating to the portfolios which Senator Evans represents in the Senate should be directed to me. Senator CHANEY —My question is addressed to the Leader of the Government in the Senate. I preface it by saying that I wish I was with Senator Gareth Evans in Perth, the most beautiful city in Australia. We can all take pleasure in the fact that he is today being asked questions about drills in holes and all those other things about which he was anxious to be questioned. I refer the Leader of the Government to the uncertainty and confusion which prevails because of the Attorney-General's apparent inability to make up his mind on the question of indemnities for members of the New South Wales police force who have been asked to give evidence to Mr Justice Stewart. Given that Mr Bowen's indecision has impeded the fight against crime for some months, can the Minister now give the Senate an assurance that indemnities will be granted so that the fight against organised crime can proceed? Further, will the Government agree to make public the advice received from the Director of Public Prosecutions, Mr Temby, and Mr Justice Stewart on the indemnity question-action which could be taken with very minor editing of the reports? If not, why not? Senator BUTTON —I will direct myself to those aspects of Senator Chaney's comments which I regard as a question and leave aside those parts which I regard as a speech. I concede that this issue, as Senator Chaney implied in his question, has led to some uncertainty. Much of the uncertainty has been generated by an Opposition bereft of ideas and policies which has devoted an enormous amount of attention to this issue. The Attorney-General will grant indemnities, if Mr Justice Stewart so advises and recommends, where he is satisfied that a person can give evidence which will lead to the prosecution of a criminal offence. I said that the issue was complex, and the Opposition has sought to derive some comfort from its complexity. Tomorrow the Attorney-General will meet Mr Temby and Mr Justice Stewart to discuss the implementation of these matters. I again refer to the complexity because, for example, there are now, of quite recent discovery, two sets of Age tapes. Indemnities have been sought in respect of the Age tapes which were taken apparently between 1976 and 1981. It is known now that the so-called Age tapes extend to 1984 and that has to be considered with Mr Justice Stewart and Mr Temby. The question Senator Chaney raised, on the possibility of publication, in a general sense, of the Temby report and the Stewart report on the indemnity issue, is a matter for discussion and, if possible, agreement between the Attorney-General and the two law officers concerned. Those discussions, as I have indicated, will take place tomorrow. Mr Justice Stewart has, as I understand it, to this stage been firmly against the publication of his report. I am not sure-I can obtain instructions on this-what precise position Mr Temby has taken in relation to the publication of his report. I heard Senator Chaney on the AM program this morning who, from the tranquil fields of Opposition, made a judgment about this matter. He was satisfied he said-Lord Justice Chaney is satisfied-that the reports ought to be published. Senator Chaney —I am being offered a job. Senator BUTTON —There was another character in the same opera called Pooh Bah and that name might apply equally to Senator Chaney. Senator Chaney has rushed to judgment, for political purposes, on this matter. From the point of view of the Government, it is at least courteous to have a discussion with the two gentlemen concerned and reach some agreement about the publication and, indeed, the manner in which publication should be made. As I said, those discussions will take place tomorrow. Senator CHANEY —I have a supplementary question. Among the many which could follow that answer, I ask the Minister: Is he saying that indemnity will be granted where that could lead to a prosecution? Does that mean 'may lead to a prosecution', or is Mr Justice Stewart required, in effect, to certify to the Government that prosecution will follow? What is the level of certainty required at this stage prior to the actual evidence having been obtained by Mr Justice Stewart? Senator BUTTON —It is my understanding that any police officer who gives evidence to a royal commission at present is not liable to prosecution in respect of matters arising from that evidence. I think that is probably common ground among the amateur lawyers, such as myself, who are in this Parliament. That being so, I think the question asked by Senator Chaney has a somewhat different character about it. What he is, in effect, asking me is whether Mr Justice Stewart has to certify that the giving of a particular piece of evidence will lead to a prosecution. I would have thought that would be an immensely difficult thing for him to do, as a matter of opinion. The Government will act, given those general parameters, on the advice of Mr Justice Stewart. I would prefer not to attempt to answer the question further until the discussions to which I have referred have taken place tomorrow because there are a number of nuances and so on in this matter which I think have to be thrashed out between Mr Justice Stewart, the Deputy Director of Public Prosecutions and the Attorney-General. Senator McKIERNAN —Can the Minister for Community Services inform the Senate whether the Queensland Government applies a means test to home care and aids for the disabled programs? Senator GRIMES —The answer, very briefly-but which will require some explanation, you will be surprised to hear, Mr President-is yes, the Queensland Government does apply means tests to its own schemes to provide aids for disabled people and for their home help and home care schemes, which it funds partly from Commonwealth funds through the States Grants (Home Care) Act. The interesting thing about these means tests, in the light of complaints about the assets test from Queensland National Party senators and from Queensland Government members and Ministers during the last election campaign, is that these tests are, indeed, means tests. The Queensland Government assesses people as to their income and their assets, and the upper limit of asset holdings in Queensland before one loses the free home care help assistance is a total of $5,000. So if people, in fact, have more than $5,000 worth of assets they have to start paying for the home help services and the home nursing services, which of course are partly funded by the Government. The situation with aids for disabled is even more interesting. There are two schemes of this type in Queensland. The Queensland Government, like other State governments, administers Commonwealth funds under the aids for disabled program-the PAD scheme-and in administering those funds it applies no means test. It also has its own State scheme for the supply of aids for the disabled and in those it supplies not only an income test but also an assets test. The upper level of the assets test is, again, $5,000. I think this demonstrates the absolute hypocrisy of people such as the Queensland National Party senators who come in here and say that we should pay full pensions and full fringe benefits to people with assets in excess of $500,000, but their own State Government, in applying assets tests and means tests to home help, et cetera, put an upper limit of $5,000 on their own benighted citizens. The hypocrisy is typical of the Queensland representatives on the other side of this place and absolutely typical of the Queensland Government. Senator TEAGUE —My question is directed to the Leader of the Government in the Senate. I refer him to Premier Wran's disclosure of the possibility that the New South Wales police tapes extend back to 1967. If, as now seems to be indicated, the Government after months of indecision may at last agree to indemnify the New South Wales police involved, will he give the Senate an unequivocal assurance that Mr Justice Stewart's terms of reference regarding the tapes and the powers available to him are sufficient to investigate all aspects of the tapes and effectively to explore all aspects of organised crime that they disclose, including crimes which fall outside terms of reference of the National Crime Authority? Senator BUTTON —The answer to that question is no, of course I will not give the Senate an unequivocal assurance on that matter. Senator Teague floats into Question Time in this chamber with a bit of ad libbing from the Premier of New South Wales, as I understand it-it is not much more than that-that the tapes go back to 1967. I do not know of any formal statement that has been made to that effect. However, if that is so, it is a matter which the government would want to consider. It is probably a matter which the Opposition's former government would have wanted to consider in a great deal of detail. Senator Chaney —That even covers your former government and the former Attorney-General. Senator BUTTON —That is absolutely right. I certainly do not give any unequivocal assurances about that, but it becomes a sensible and necessary step. The Government will consider it and consider it favourably. Senator BOLKUS —I refer the Minister for Education to the long-standing proposal to introduce modern Greek at Flinders University in South Australia. I ask: Is it a fact that Federal funding was both promised and allocated for this project and that the South Australian Government and the local Greek community are prepared to contribute to the establishment of a chair of modern Greek? Is it also a fact that the Commonwealth Tertiary Education Commission recommended funding for this project in its report of September 1984? Will the Minister now indicate why there is a delay in the inception of this much needed course? Senator RYAN —It is the case that the Commonwealth has expressed support for the establishment of a chair of modern Greek at Flinders University and will, in due course, make funds available for that purpose. The project, in its early stages, is to be funded jointly by the Greek community and the State Government and later by Commonwealth support. I think they were the terms in which the election undertaking that initiated this project was made. The Commonwealth Government's commitment was made against the background of the significant community and State Government support which is now forthcoming. The Tertiary Education Commission addressed this matter in its Volume 2 advice but did not recommend Commonwealth funding for 1985. Pages 19 and 20 of that report state: On the basis that the community and State Government financial support were forthcoming, no Commonwealth funds will be required in 1985. The University's Council has not provided the $100,000 for 1986 and the $150,000 for 1987 within the University's grants for those years as it considered the Government's broader intake objectives should have priority. However, both the South Australian Government and the Greek community have now given undertakings to provide financial support in 1985 for the initial establishment of the chair. As I said, Commonwealth funds will not be available for 1985. The question of the level of Commonwealth support required for 1986 and beyond to maintain the chair will be addressed by the Commonwealth Tertiary Education Commission in its supplementary report for the triennium, which I expect to receive shortly. Senator HAINES —My question is addressed to the Minister representing the Attorney-General. In answering a question from Senator Chaney earlier in Question Time, the Minister indicated that the granting of indemnity to the police officers mentioned in Mr Justice Stewart's eighth interim report would be determined according to recommendations from Mr Justice Stewart. Is the Minister saying that it is likely that not all the 31 police officers mentioned will be or could be given indemnity? If that is the case, that is, if Mr Justice Stewart does not recommend indemnity for all 31 police officers, does this mean that those police officers not granted indemnity will be or could be prosecuted? Can the Minister say whether the New South Wales Premier, Mr Wran, will also be granting indemnity only to some of the policemen? If so, will it be to the same police officers, that is, will the New South Wales and Federal governments reach some agreement regarding which police officers will be granted indemnity and which will not? Senator BUTTON —As distinct from Senator Chipp, who has been locked in earnest conversation with Senator Haines in the last few minutes, I do not have the advantage of having read Mr Justice Stewart's report. However, let me say that there are two situations. As I understand it-certainly there is a rumour about-Mr Justice Stewart has embraced the view that a blanket indemnity should be granted for the 31 officers concerned. It is perfectly true to say, as Senator Haines puts it in her question, that if Mr Justice Stewart does not recommend the granting of an indemnity in respect of the circumstances which I dealt with in my answer to Senator Chaney, particular officers will not be granted an indemnity because there will not be a recommendation from the judge to that effect. As I said in my answer to Senator Chaney, the fact that indemnity is not granted does not necessarily render any officers not granted an indemnity liable to prosecution if they are giving evidence to a royal commission. It does not render them liable to prosecution at all. I make the comment that the 31 policemen have a fairly high ambit claim on this issue. Insofar as I am asked about what the Premier of New South Wales, Mr Wran, might do, I am not in a position to answer that part of the question. Certainly I cannot say what the New South Wales Government might do about indemnities at this stage. Of course, we can try to find that out for the honourable senator but I do not know what that Government's position is. If I can obtain further information I will make it available to Senator Haines in due course. Senator HAINES —I ask a supplementary question. Does the Minister then believe that it would be advisable for the New South Wales and Federal governments to grant indemnities to the same police officers? Senator BUTTON —My belief about that matter is totally irrelevant. It has to be determined on the facts in each case and, as I have said in answers to previous questions here, the Government will act on the recommendation of Mr Justice Stewart. It is the recommendation of Mr Justice Stewart which is the relevant fact, not the belief of the Leader of the Government in the Senate. Senator AULICH —I ask the Minister representing the Minister for Health whether he has seen reports in the Advocate indicating that he has said that the Federal Government would be prepared to give approval in principle to the establishment of a private hospital in Burnie. Can the Minister say whether he has been quoted accurately by Mr Talbot of Australian Hospital Care Pty Ltd? Senator GRIMES —Yes, my attention was drawn to an article in the north-west Advocate in Tasmania which said that I had given the representatives of Australian Hospital Care Pty Ltd to believe that the Federal Government would approve in principle a private hospital on the north-west coast. There are no private hospital facilities on the north-west coast of Tasmania and at the moment there are at least two competing organisations which wish to set up a private hospital-one in Burnie and one, I understand, in Devonport. The State Government, wishing of course to divest itself of public facilities, would prefer that such a private hospital be in Ulverstone by its selling the Ulverstone hospital to private interests. When I was Acting Minister for Health I saw representatives of Australian Hospital Care Pty Ltd and told then two things. First I said that the Federal Government would consider giving approval in principle to the establishment of a private hospital on the north-west coast of Tasmania. I said that I did not favour any particular site and I did not suggest that we would favour any particular site. I also told them that such recommendations would be considered when the State Government made recommendations to the Federal Government on where that hospital should be and by whom it should be operated. I can understand the difficulties and the frustrations of the various groups involved which want to set up a private hospital, but those difficulties and frustrations are not the fault of the Federal Government. The difficulty is that the State Government-and particularly Mr Cleary, the State Minister for Health, who has great difficulty in making up his mind about anything and, when he does, has to go back to the Premier and seek the Premier's permission before he can give a view on anything-will not make a decision. The great difficulty which governments of that type have in Tasmania is that they cannot make up their minds whether they should please the voters of Burnie, the voters of Ulverstone, the voters of Devonport or none at all. When the State Government makes a recommendation, the Federal Government will consider it. But until that happens, I am afraid that Australian Hospital Care Pty Ltd, and other such organisations, will have to remain frustrated. In this competitive situation, I can understand that the organisation may have misstated what I said, but I am in no doubt about what I said at all. I made those statements to that organisation after having been fully briefed on the situation by the Department of which I was Acting Minister at the time. The ball is at the feet of the Tasmanian Government, not the Federal Government, at present. I hope that the Tasmanian Government will eventually make up its mind as to just what it wants to do. Senator PETER RAE —I refer the Minister for Finance to the answer that he gave to me last week, in which he denied being committed to any particular mix of taxes, including a capital gains tax, as part of a package involved with a move to greater emphasis on indirect taxation. Does the Minister agree that he was rather more definite in a speech that he made to the Commonwealth and State women's advisers in Canberra on Friday last, when he said that it would be difficult to see how desired changes to the tax system could be achieved 'without some form of capital gains tax'? Will the Minister now explain what he sees as the virtues of a capital gains tax and indicate, without committing himself of course, whether he has now a personal preference for this means of obtaining extra revenue in the same way as has the Leader of the Government in the Senate expressed his personal preference? Senator WALSH —Half of this Senate-people such as Senator Peter Rae, the Liberals, the National Party, the Australian Democrats and Senator Harradine-continues to pursue a policy which allows people who plunder the public purse to keep the money that they have already pinched after they have been found out, but says: 'We will take it off them if they keep pinching money from the public purse', as distinct from the policy of the present Government, which says: 'If you are found out pinching money from the public purse you will have to pay it back; you have got to pay back what you have pinched, as well as that which you may pinch the next day'. In other words, Senator Peter Rae and his ilk refuse to pass effective legislation which will take back from tax evaders the money that they stole yesterday as well as that which they may have anticipated stealing tomorrow. As long as they continue to pursue such a policy it is difficult to see how blatant tax avoidance schemes of the type endorsed by just over half this Senate last week can be closed off in any way other than by putting in place a mechanism which ensures that receipts or cash flows which are, in fact, income, but which are disguised as something else, are taxed as income. Senator Peter Rae correctly quoted my answer of last week. I said that I do not see how it is possible to close off tax avoidance without some measure which changes the definition of capital gain, as it has been laid down by the courts and is accepted, and converts it to income. If Senator Peter Rae can suggest some way of dealing with that problem and thereby closing off the conversion of income into capital for the clear, explicit purpose of avoiding taxation, I should be very pleased to hear it. But at this stage, I cannot think of any other way of doing it. I can only assume from the implicit criticism-explicit criticism often comes from the Liberal Party and other Opposition parties on this question-that their favouritism towards tax evaders and tax avoiders is more general than that which they normally express; that is, not only will they refuse to issue a credible threat of retrospectivity to close off tax avoidance, but also they will stop any other means of closing off tax avoidance. Senator PETER RAE —By way of supplementary question, will the Minister, instead of abusing his colleagues in another place who have engaged in tax avoidance and calling them plunderers of the public purse, answer the question I asked him, which was: Will the Minister, without committing himself necessarily, state whether he has a personal preference for a capital gains tax as a means of obtaining extra revenue? Does he or does he not have such a personal preference? Senator WALSH —I have a very strong personal preference for putting a steel trap under tax avoidance and tax evasion. I just wish that members of the Opposition shared that preference. Senator HEARN —I address my question to the Minister for Veterans' Affairs. Has he seen the article in today's Canberra Times headed 'Doubts over financial advice to pensioners', which is based partly on his response yesterday to Senator Black's question regarding avoidance of the pension income test? Do the reported comments by various bank managers to the effect that it is not their responsibility to advise pensioners one way or the other on the wisdom of investing large sums of money in non-interest-bearing accounts partly explain the prevalence of such accounts under the previous income test? Senator GIETZELT —Yes, I have seen the article in today's Canberra Times in which both Senator Grimes and I have been quoted, following Question Time yesterday. I am somewhat appalled by the laissez-faire attitude with which the particular bank managers regard their responsibilities and obligations to the customers' welfare and interests. I was particularly interested in the comments attributed to the Australian Capital Territory Manager of the Australia and New Zealand Banking Group Limited who is reported as saying that it is the customers' prerogative to deposit funds in non-interest-bearing accounts in order to qualify for the pension or fringe benefits. He went to some lengths to say that that was a proper course of action. He also said that in the circumstances the bank accepted the money and the customer was not advised one way or the other, to use his words. I find this statement rather odd in view of the claim made by the bank's brochure promoting its retirement service, a copy of which I have here, under the heading 'Advice you can trust'. It goes on to say: . . . a great help when it comes to organising things like a regular income, security for your future, your pension eligibility and tax aspects of your investment programme. The brochure, under the heading 'The Pension. Your eligibility' also says: Your eligibility, or more importantly, your potential to realise your full eligibility is crucial to you. Our advisers are constantly updating on the relevant entitlements and qualifications. I also find it somewhat ironical that the service pensioner to whom I referred in replying to the question that I was asked yesterday with assessable assets of $356,000, including $354,000 in a non-interest bearing account, had his money in the ANZ Bank. Just this morning another case involving a service pensioner, a customer of the ANZ Bank in Queensland, was brought to my attention. This single home-owning pensioner had $135,000 in the bank, $100,000 of which was earning no interest at all. I have calculated that, after allowing for his pension entitlement, fringe benefits, tax and income test threshold and so on, he was being deprived of at least $3,000 a year by poor advice or, more likely, no advice whatsoever. Honourable senators will, of course, be familiar with this sort of advice from people in banking institutions, in particular from the ANZ Bank, which claims in its retirement services brochure to be 'the bank that serves you best'. It ought to change its slogan and call itself 'the bank that serves itself best' in view of the advice it is giving pensioners. Senator SHORT —Has the Minister for Finance publicly canvassed the possibility of a considerable tightening of the taxation of employee fringe benefits? What return to Commonwealth revenue would he expect to result from greater scrutiny of benefits such as discounted air fares, subsidised canteen services, entertainment expenses, free beer for brewery employees at their work breaks and free weekend meat for butchers' apprentices, which is common? If the Minister believes such benefits should be taxed, does he foresee any practical difficulties in light of comments such as those of the New South Wales Secretary of the Transport Workers Union, Mr Harry Quinn, who, in reacting to suggestions that members employed by Qantas Australia Ltd might be hit by the taxing of discounted air fares, said: 'There'd be the biggest industrial upheaval in years'? Senator WALSH —I was asked whether I had publicly canvassed the taxation of fringe benefits. I do not claim that my memory is infallible, but I do not remember having done so. The second part of the question was about what revenue it is estimated would be obtained if all fringe benefits were taxed. I think there are some rough Australian Taxation Office estimates around. I will try to obtain them from the Treasurer. The definition of what is a fringe benefit is, at least at the margin, somewhat arbitrary. For example, I discovered recently that there is a $1.3m loss on the operations of the dining room in this Parliament once all wage costs are taken into account. That averages out at something like $5,000 for each member of Parliament. That then raises the question of whether we each should have added on to our taxable incomes $5,000 to cover the notional loss to the dining room. I do not know whether Senator Short is suggesting that that should be done. If he is, I am certainly willing to consider it and to propose to the Treasurer either that it be taxed as imputed income or that dining room charges be increased so that the loss is reduced. With respect to other fringe benefits, it has been suggested by some people that former Treasury officials who leaked documents obtained the fringe benefit of Liberal Party preselection for seats in 1975, but I do not know how we could quantify or tax that benefit. The concept of a fringe benefit being that of having access to Treasury documents which can be leaked, with the reward of Liberal Party endorsement for a seat, is one that is hard to grasp. Senator COATES —Has the Minister for Community Services seen the reported complaints from the Tasmanian Minister for Community Welfare, Mr Cleary, about the Commonwealth's failure to approve funding for a child care centre at Lower Gagebrook? Is there any basis for Mr Cleary's complaint? What are the facts about the delay for this centre? When will construction begin? Senator GRIMES —Yes, I have seen those reports. Mr Cleary has been very active in that regard this week. Mr Cleary is the Minister responsible for children's services, among other things, in Tasmania. As I said in answer to a previous question, he is a very difficult person to negotiate with for two reasons: First, he has trouble making up his mind; secondly, when one does come to a position with Mr Cleary, that is not the end of it because he has to go back to the State Premier, Mr Gray, and find out whether what he has done is okay, and if it is not okay he comes back again, and the negotiations tend to be endless. But he is always very quick to criticise the Federal Government, particularly when the Federal Government is not at fault. There is in fact an occasional care centre at Gagebrook, as there is at nearby Bridgewater, which is funded by the Federal Government through both salary subsidies and fee relief. The Gagebrook people have put in an application for the funding of a child care centre. Under the Commonwealth-State arrangements, that application is considered by a Commonwealth-State committee. That Commonwealth-State committee is still considering the matter of funding for the Gagebrook child care centre. Mr Cleary knows that all funds for Tasmania for this budgetary year have been expended. He also knows that the committee is considering this matter and that the first opportunity to fund the Gagebrook centre would be after the next Budget. Despite that, Mr Cleary has the cheek to get up in the Tasmanian Parliament and say that the fault is with the Federal Government because it will not consider the centre and will not fund it. Mr Cleary knows that this is a matter of co-operation between the State and Federal governments. We have had agreements with the States to assist us in the planning and funding of child care centres. Most States are willing to provide some financial assistance, some land and, in some cases, buildings to increase the number of child care centres that are available. In the last two years of office of this Government we have increased the number by 70 per cent. Sometimes Tasmania provides land and sometimes it provides buildings. In Gagebrook the Tasmanian Government is willing to provide the land. But the Tasmanian Government is unwilling in this area as in others to provide any finance; all we get is carping criticism from the inadequate Minister in Tasmania. I dare say this will go on week after week and occasionally I will have to answer it. However, the simple fact of the matter is that this matter is before a Commonwealth-State committee which is considering it. Mr Cleary, I believe, does know it is before that committee. If he does not know, he is incompetent. However, as I believe he does know, his statement to the Tasmanian Parliament was deliberately misleading. In fact, it was a deliberate lie, and I hope that the people of Gagebrook know that. Senator Peter Baume —Mr President, I raise a point of order. I draw your attention to standing order 418. The Minister said that a certain statement was deliberately misleading. I believe that he has contravened the Standing Orders and I ask that he withdraw. The PRESIDENT —Clearly the Minister was out of order in relation to standing order 418. I ask him to withdraw the imputation against a State Minister. Senator GRIMES —I withdraw the statement that he is deliberately misleading the Tasmanian Parliament. The obvious implication, if he is not deliberately misleading the people, is that he is incompetent. Senator MacGIBBON —Did the Minister representing the Prime Minister see the comments by the President of the Australian Council of Trade Unions, Mr Dolan, that the Prime Minister and the union movement may have bitten off more than they could chew in the tax reform debate? Senator Cook —Make it sensible. Senator MacGIBBON —I could not get down to the honourable senator's level. Since the Government must have the support of the union movement to hold and implement the findings of the tax summit, and considering the Prime Minister's views in Ottawa on the tax summit that his Government is not in the business of committing political suicide on this or any other issues, I ask: Is the Government unequivocally determined to hold this summit, which now has the sole purpose of legitimising further tax increases, or is the Government wobbly on this issue too? Senator BUTTON —Again, I will ignore the speech not only because this is Question Time but also because the speech had very low intellectual content. I am aware of the comments made by Mr Dolan and I take them for what they are worth. A lot of people have made comments of a similar kind. If one embarks on any significant changes in this country and sees that those changes are, as far as possible, accomplished in the open, in an atmosphere of free discussion, inevitably one will get that sort of comment and criticism. Whether it comes from newspapers, Mr Dolan or honourable senators does not matter very much as one gives it the same sort of weight. The Prime Minister said in Ottawa, in answer to a question about the tax summit, that this Government was not in the business of committing political suicide, and I assure honourable senators that that is correct. It is a view that I substantially share. Senator Peter Rae —Are you going to withdraw the assets test? Senator BUTTON —The assets test was there at the last election. Of course, the Government could do what Senator Peter Rae has been doing in the last 12 months, and what other honourable senators opposite have been doing, and ignore the major issues facing this country and go around collecting a grab-bag of constituencies which are concerned about particular vested interests which they have. That is one way one could probably do reasonably well in politics. After all, the Australian Democrats have been pretty good at that. One can do well in that style of politics, but if one is addressing major issues which are a matter of common consensus-and the taxation review is a major issue-then, of course, there will be difficulties along the way. When that taxation review is accomplished, we will be judged on how we have done it. We are prepared to face that risk and I suppose we are very much comforted by the fact that, at the same time as the electorate judges us, it will be judging the Opposition as well. That will make it much easier for us. Returning to the nub of Senator MacGibbon's question, yes, the process of consultation, including the summit, will proceed. Senator FOREMAN —My question is directed to the Minister for Industry, Technology and Commerce. As unleaded petrol is to be introduced in Australia this year, and the technology required to produce engines which can run on unleaded petrol has never been used in this country, will this mean that the high technology engines and high technology fuel delivery systems will need to be imported? Will this bring about a virtual dominance of Japanese engine design in local vehicles? Will this threaten the plans that have been made for the restructuring of the motor industry and how will this, in turn, affect job prospects in the vehicle industry? Senator BUTTON —Local engine manufacturers will need to undertake only minor design modifications in order to make their engines suitable for use with unleaded petrol. A number of companies have already established plants or facilities in order to provide that conversion process. It is not anticipated that there will be any significant increase in imports of engines because of the introduction of unleaded petrol. In the Government's view, the introduction of unleaded petrol will not bring about a virtual dominance of Japanese engine design in Australian vehicles, but let me say that that is a risk that this industry in Australia has always run, irrespective of leaded or unleaded petrol. That is a matter to which the motor car plan is, in part, addressed. It is trying to get some resolution of the difficult problem of local sourcing of engines and the joint ventures, in a sense, to produce local engines. The second part of the question related to whether the introduction of unleaded petrol threatens the Government's passenger motor vehicle plan in any way. In part I have answered that. The question also related to employment in this industry. The plan is devoted to long term stability in the motor vehicle industry and the capacity of that industry to expand and provide secure employment. As I have said in the Senate on numerous occasions since the plan was announced, inevitably there will be reductions of employment in the motor vehicle industry. That is happening throughout the world and there is no reason why Australia should be immune from that process, unless we wish to continue with production measures which were relevant 10, 15 or 20 years ago but which are not relevant to the production of contemporary motor cars using contemporary technology. That process will happen. I have said from the beginning that employment in 1992 at the end of the period of the motor vehicle plan will, in my view and in the view of all the car manufacturers, be less than it is now. However, it will not be affected by the introduction of unleaded petrol. Having said that, I appreciate Senator Foreman's concern about the changes which affect the motor vehicle industry and the possible impact which they may have on the operation of the motor vehicle plan. Senator Foreman has been continually alert and questioning about these issues, coming as he does from South Australia which has a very important component of its industry tied up with the production of motor vehicles. Senator MACKLIN —My question is addressed to the Minister representing the Minister for Aboriginal Affairs. Is the Minister aware of the Burke Labor Government's latest moves in Western Australia effectively to destroy the already inadequate Aboriginal land rights legislation being introduced there? What is the Minister's response to Premier Burke's extraordinary attempt to usurp the Federal Government's proper authority in this sensitive area by introducing a new clause into its legislation, the effect of which would be to abolish all Aboriginal land rights grants if the Federal Government ever sought to assert its power to grant a reasonable level of protection for Aboriginals in this country? Senator RYAN —I am not aware of the accuracy of the claim that Senator Macklin has made with regard to changes to the Western Australian land rights legislation but I remind him that the process of consultation going on between the Federal Minister for Aboriginal Affairs and the Western Australian Government is aimed at securing agreement about the principles which should be incorporated in all land rights legislation throughout Australia. It is important to point out that the Commonwealth has not abandoned its land rights policy and we hope, by further discussion and negotiation with the State Government, to ensure that the principles set out on a number of occasions by Mr Holding as being principles that our Government would require will be implemented, either through State Government legislation or ultimately through comprehensive Federal legislation. Senator JONES —My question is addressed to the Leader of the Government in the Senate. Has his attention been drawn to a statement in yesterday's Courier-Mail in which the Premier of Queensland hinted at further strike Bills in Queensland and to a number of statements in which the Premier said that Mr Hawke was reluctant to criticise the new Queensland anti-union legislation because he was jealous of it? Sir Joh Bjelke-Petersen went on to say that Queensland would secede from the Commonwealth of Australia if it did not get a fair deal at the coming Premiers Conference. He said: If they don't want to treat us according to the Constitution, then we will jump into it alone. He confirmed that this meant taking steps to gain independence from the rest of Australia. What is the Federal Government's attitude to the statements made by the Premier and can the Minister inform the Senate as to what legal right the Premier has in relation to Queensland's secession from the Commonwealth of Australia? Senator BUTTON —The statement allegedly made by the Premier of Queensland has been drawn to my attention. Senator Sheil —That is funny. Senator BUTTON —Yes, it is funny. I understand that yesterday Sir Joh Bjelke-Petersen confirmed that he meant that steps would be taken to gain independence for Queensland from the rest of Australia. I believe that there will be further consideration of this matter by the Premier of Queensland. In 1934 Western Australia petitioned the Parliament of Westminster seeking preliminary steps to be taken in respect of the secession of that State from the Commonwealth of Australia. That petition was not greeted with warmth by the United Kingdom and in fact was rejected. I remind honourable senators that the preamble to the Constitution Act of the United Kingdom Parliament, by which the Commonwealth of Australia Constitution Act was established, recites the agreement of the people of the several colonies of Australia 'to unite in one indissoluble Federal Commonwealth under the Crown'. Most of us, except one or two of Irish extraction, would be grateful for that recitation which appears in the preamble to the Constitution Act. Neither the Constitution nor the Constitution Act makes any provision for secession of a State. Section 128 of the Constitution sets out the only practical method of amendment to the Constitution, and that is by referendum. The application of section 128 of the Constitution to the covering provision-namely, the one to which I have referred, the Constitution Act-is a matter on which there are differing views amongst distinguished lawyers. Having drawn attention to the legal difficulties involved, I remind the Senate of the practical consequences which could possibly occur. For example, members of this Government would be buoyed up by the absence of withering attacks on the capacity of our Government from Senator Sheil, Senator Boswell and Senator MacGibbon. On the other hand, I would personally miss Senator Bjelke-Petersen in this chamber. There would be even graver consequences than that, because if the proposal for Queensland to secede from the Commonwealth of Australia were put to a referendum, I remind the Premier that there is a distinct possibility that most Queenslanders would not vote for it, but most people in the rest of the Commonwealth would. The PRESIDENT —I draw the attention of honourable senators to the presence in the gallery of former Senator Gordon Davidson from South Australia. To former Senator Davidson and Mrs Davidson, on behalf of all senators, I extend a warm and friendly welcome upon their return to Canberra. Earlier in the day our former colleague, former Senator Bonner, was here. I should have conveyed the same sentiments to him but, unfortunately, he departed before I had the opportunity so to do. Senator SHEIL —Is the Minister representing the Minister for Foreign Affairs aware that Australian organisations, including the Australian Council of Churches and the Australian Teachers Federation, have collectively donated $15,000 to assist the overthrow of democracy in New Caledonia by the Libyan supported Marxist FLNKS Party? What is the Minister's comment on Australian organisations which finance such terrorism? Senator BUTTON —I am not aware of any official reports to that effect. I have seen television programs-I think, emanating from Queensland-in which it was suggested that some money had been made available by the organisations in question to the FLNKS Party. I think it would be wrong to judge the Kanak movement in New Caledonia, as Senator Sheil does, as a Libyan supported Marxist organisation. It may be Libyan supported; it may be supported also by a wide range of other people who would not fall into the same pejorative category of Libyan supported Marxists to which Senator Sheil refers. I think that is a very simple description of a very complex issue, and I do not think it is helpful in the public discussion to go down that track. I would have thought it inadvisable for any organisations in Australia to be devoting energies to collecting moneys for arms for support of insurgent groups of the Right or the Left, wherever they may be. I commend that view to Senator Sheil and some of his colleagues in the National Party in Queensland. Senator ROBERT RAY —I direct my question to the Minister representing the Minister for Resources and Energy. Has the Minister's attention been drawn to comments reported in today's Press about the Commonwealth Government's planned introduction of a cash bonus bidding system for oil exploration permits? Can the Minister provide the Senate with the background to this decision by the Government? Senator WALSH —I have seen the Press comments. I also have a copy of most of the rather extraordinary speech delivered yesterday by the Premier of Western Australia. Mr Burke displayed a degree of conceptual ignorance of the subject which was matched only by his political impertinence. I say political impertinence because the policy in question is the auctioning of or the seeking of cash bids for oil exploration permits in off-shore areas, which the High Court of Australia decreed in 1975 are Commonwealth territories, apart from it being a Commonwealth policy. So much for the political impertinence. As for the conceptual ignorance, among other things he said: We are strongly opposed to the concept-- that is of cash bids-- simply because it would increase the cost of exploration. How a cash bid increases the cost of drilling a well must remain a matter for wide eyed conjecture. Senator Gareth Evans is to speak at the Australian Petroleum Exploration Association conference in Perth today. I suppose reading this might be sort of breaking the embargo on a small part of his speech, but he will comment on the assertion that cash bidding will reduce the funds available for exploration. He is going to say: The assumption underlying this argument is that the funds available for exploration are fixed, that the Australian exploration industry is a closed shop within which a given amount of funds circulate without either escaping or being topped up. That of course does not describe the actual situation. The Western Australian Premier also said, speaking of cash bidding: It discourages exploration companies from sinking sufficient wildcat wells . . . A wildcat well, by definition, is a well sunk in completely unknown and uncharted territory. In such territory, one would expect the cash bids to be zero and, therefore, the whole issue to disappear off the agenda. I can only presume that Mr Burke does not understand the principle involved in an auction system-if he did he would not have made the comments he did-or, alternatively, that he has fallen victim to propaganda from industry interests who, of course, would rather obtain exploration permit areas for nothing than have to compete with some other company to obtain the right to exploit minerals which may be present. There is, however, one gratifying comment in Mr Burke's speech. Given especially that this Government bent over backwards two or three weeks ago to rescue the Western Australian Government from the consequences of the take or pay gas contract which the previous Liberal State Government had bequeathed it, Mr Burke also said: We do not believe that the cash bonus bid system is an acceptable means of raising government revenue. I anticipate that there will be no claims from the Western Australian Government for any revenue so raised. There are, of course, other very practical advantages in the cash bonus bidding system in terms of providing a more objective means of allocating perceived prospective areas to competing companies. I suggest that those honourable senators who want to know more of the technical details of that read Senator Gareth Evans's speech which is to be delivered in Perth today. Senator Chaney —Mr President, under standing order 363, I ask the Minister to table the paper from which he quoted during that answer, please. Senator WALSH —What paper? Gareth's speech? Senator Chaney —Whatever you were reading. Senator WALSH —I will not table Senator Gareth Evans's speech because I suppose I have marginally broken an embargo on it, albeit on one paragraph. I do not mind tabling this document which has my handwritten notes on it. The PRESIDENT —I take it the Minister is prepared to table one document but claims confidentiality in respect of the other? Senator WALSH —Yes. The PRESIDENT —Thank you. Senator MISSEN —My question is addressed to the Minister Assisting the Prime Minister on the Status of Women. It relates to representations made to the Minister by the National Status of Women Committee of the United Nations Association of Australia in respect of the lack of consultation between the Government and non-government women's organisations and, in particular, to the Government's lack of support for non-government women's organisations' participation in the regional preparations for the world conference to be held in Nairobi marking the end of the United Nations Decade for Women. In the light of the concern expressed by the National Status of Women Committee, I ask the Minister: Firstly, will the Government restore the arrangements put in place by the previous Liberal Government whereby consultative meetings with national women's non-government organisations took place on a regular basis; secondly, will the Government include representatives of women's non-government organisations in the official government delegation to the national world conference as occurred at the mid-decade conference in Copenhagen? Senator RYAN —I am surprised to hear that there are criticisms from the non-government sector regarding the preparations for Nairobi because our Government has taken a very significant step to ensure the participation of non-government women in that forum. In fact, in response to an advertisement placed in the newspaper on behalf of the Government the Office of the Status of Women received well over 200 applications from women in the community who wished to be included in the non-government organisations' forum in Nairobi. The Government has decided to fund fully approximately 20 women to attend that conference, a decision which I think Senator Missen would agree shows a very serious commitment to assisting non-government women to go to Nairobi. It is also the case that there is to be a government delegation which will be led by a member of the Government and which will comprise experts from the various relevant departments and also from the State government level. Edith Hall, a non-government woman who is the convenor of the National Women's Consultative Council, will be a member of that delegation. So, via the Council and the organisations it represents, there will be a voice in the government delegation. At the same time, 20 non-government women will be given full assistance to attend the forum in Nairobi. Senator MISSEN —Mr President, I ask a supplementary question. In view of the fact that I supplied to the Minister, with notice of this question, a copy of the letter from the United Nations Association making these complaints, why is she surprised? Did she read it? Senator RYAN —I think Senator Missen is seeking to make a rhetorical point. I ask him to address himself to the reply I have just given and assess himself whether there are any grounds for criticism of the Government in this matter. I am sure he will find that there are not. The PRESIDENT —I inform the Senate that I have received the following letter, dated 26 March, from Senator Chaney: Dear Mr President, Pursuant to Standing Order 64, I give notice that today I propose to move- 'That, in the opinion of the Senate, the following is a matter of urgency: In light of the kite flying about means testing the supporting spouse allowance in the taxation system and family allowances in the social security system, the need to make it clear to the Government and the pending tax summit that there must be provisions in the tax and social security systems to allow for the additional responsibilities of those with dependants.' Yours sincerely, FRED CHANEY Senator for the State of Western Australia Is the proposal supported? More than the number of senators required by the Standing Orders having risen in their places- Senator CHANEY(Western Australia-Leader of the Opposition)(3.08) —I move: That, in the opinion of the Senate, the following is a matter of urgency: In light of the kite flying about means testing the supporting spouse allowance in the taxation system and family allowances in the social security system, the need to make it clear to the Government and the pending tax summit that there must be provisions in the tax and social security systems to allow for the additional responsibilities of those with dependants. The Opposition brings forward this motion of urgency on the basis that it wants to give a clear message both to the Government and to the tax summit on an issue which will affect many taxpayers and families in Australia and, most significantly I suppose, the pay as you earn taxpayers who support dependants from their earnings. Over the last few weeks we have seen a confusion of signals about taxation and related matters. That confusion has arisen partly because of apparently genuine differences between some members of the Government Party. However, it also appears clear that the Government has been testing the water on some issues. That is, of course, often a prelude to action. We have had reports and direct statements by Ministers recently which make it clear that there is room for concern about the tax and social security provisions which provide for some differentiation in this community between individuals who have dependants and those who do not. I refer to some of the reports. In a weekend newspaper, the Sunday Telegraph, in a front page story headed 'Family allowances means test review', it was suggested that family allowances might become the latest welfare target as the Federal Government casts its net wider in its commitment to tax reform. The report stated: Radical changes to the family allowance structure are being considered, including a means test. The article, as do all the articles I have in front of me, referred to the Minister for Finance, Senator Walsh, and his desire to rationalise some of these areas. In the debate today I hope to touch on the rationale for some of these provisions and why, in terms of the general approach that is adopted, we believe that people who have dependants, at whatever income level they might exist ought to be treated differently from those who have the same level of income but who have not additional responsibilities for dependants. An article in the Australian newspaper referred extensively to the possibility of the dependent spouse benefit, the taxation allowance for dependent spouses, being also subject to income limits. Of course, Senator Walsh weighed into that report in a very derogatory way yesterday. But we do not rely just on newspaper reports. In the Senate on 21 March, just last week, Senator Walsh, in answer to the first of two questions that he has had from Senator Maguire on this and related issues, made the point: It could certainly be argued, I believe, that that provides a prima facie case for means testing. There he was referring to the dependent spouse allowance. He made the point that some of the highest taxpayers receive some of the rebate. He stated that such taxpayers receive one-third of the total amount spent on the rebate to spouses. It was in that context that he said: It could certainly be argued, I believe, that that provides a prima facie case for means testing. It is that so-called prima facie case that appears to be in the mind of the Minister for Finance that I wish to address. I note that in his answer to Senator Maguire yesterday he chose to stay away from the merits and the substance of the issue. He did not really disclose his own attitude; rather, he took refuge in criticising the Leader of the Opposition, Mr Peacock, for a statement which he made on the Sunday television show some weeks ago when he said that there was some possible merit in examining that particular proposition, namely, that the spouse allowance should be subject to some form of means test or income test. In fact, of course, Mr Peacock has made it quite clear in recent statements that, whatever examination might be permitted, we have the clearest possible policy which flies in the face of that-a policy in favour of income splitting for spouses. Mr Peacock has made it abundantly clear that we do not see the abolition or reduction of the spouse rebate as being in any way compatible with the policies we have adopted. We are not seeking in the debate today to get a close definition of precisely how the Government should achieve the support for dependency which we are seeking in either the tax or the social security system. We are not trying to set out to perform a detailed defence of the status quo; rather, what we are saying is that those taxpayers who have dependants and who are prepared to support a spouse and/or children ought to be given some recognition, some acknowledgment, of the additional expenses they incur and the savings which they promote for the Australian people. This is a key matter of public interest on two, and perhaps three, levels. Certainly it is a key matter of public interest in terms of the public interest that there is in the maintenance of families as centres of nurture of children. Most Australian children are born within a family unit. Most are raised within a family unit and most are given support, education and training within a family unit. That matter is of enormous importance to Australia. In asserting that, one is not putting down those for whom that is not a reality. It is simply a matter of acknowledging the value to the whole community of those who meet the emotional as well as financial responsibility of their dependants. That is not some peculiar Liberal view; it is a view which is widely accepted throughout the Australian community. I was pleased to get via Senator Baume earlier today a copy of a paper which was prepared by Dr Don Edgar of the Australian Institute of Family Studies. It is entitled 'Emerging Changes in Family Life and their Effects on the ''Health'' of Society'. I merely want to refer to the views which Dr Edgar puts in the early part of his paper which I suppose are, or ought to be, self-evident to most of us but which can at times come under contest. They are views which are fundamental to our approach to this matter. I will quote a few pieces out of the first two pages of Dr Edgar's paper wherein he states: The family . . . is the basic group unit around which all other social life is organized. He went on to say: The 'nuclear' family comprising husband, wife and children has always been the basic family form. For social control over sexual reproduction is the underlying basis of family life, with different societies in differing historical and economic circumstances choosing their own 'overlay' of social mechanisms to ensure that control. Later on, he said: I venture to suggest that we will see no change in this underlying need. On behalf of the Opposition, I express very strong support for the view that the family will remain a central unit in Australian society for the propagation of human life, the care and nurture of children, the education of children, and the promotion of true Australian values. That is the broad public interest. An interest is maintained by every Australian in the stability and support of the family. I suggest that the second key area which makes this a matter of public and not merely private interest is the interest which accrues to each taxpayer in meeting the problems which arise when there is family breakdown. There is enormous public cost when dependants are not looked after by those who are responsible for them. Again, in saying who is responsible, this is not some narrow Liberal view. The United Nations declaration on the rights of children makes it clear that the primary responsibility for the care of children rests with parents. But we face an interesting situation where we accept wholeheartedly a public responsibility for the care of those families where dependency is not maintained. In looking at the provisions which presently exist to support families, it is interesting to see how heavily the scales are weighted-necessarily weighted-in favour of those families which have suffered breakdown. Take a family of a man, a wife and one child. Under the arrangements which are in place, that family, if one of the spouses is dependent receives a tax advantage of $1,030 a year. That is an advantage of about $20 a week over someone who is without dependants and on the same income. In addition to that, the family receives family allowance of $22.80 a month. So the total assistance which is given to that family in terms of differentiating between it and the family or individual without dependants is about $25 per week. Looking at the pension which is paid should the husband leave the wife with a child or the wife leave the husband with a child, one finds that that advantage of about $25 a week is transferred to an immediate cash payment of $115.90 a week. I make it quite clear that we are not talking about removing the assistance which is provided to those people who find themselves, often through no fault of their own, in necessitous circumstances. What I am saying is that we provide relatively modest levels of assistance at present for those individuals in society who are maintaining their dependants and trying to do their best to ensure that they are not a charge on their fellow taxpayers but that they remain personally responsible. Fundamentally, at present, the assistance which is provided for those families which are comprised of a husband, wife and children is limited to the family allowance which is paid to all such families and the dependent spouse rebate which is paid to those families which have either only one income or one income which is taxable and another income which is relatively small. The issue is quite straightforward, and one would have hoped that it would receive the unanimous endorsement of this Senate. We are simply suggesting that those who have responsibilities for people other than themselves have considerable additional expense. We properly rush to help where there is breakdown. Very limited help is provided where there is no breakdown. I think it is abhorrent that it should be suggested that the very limited assistance which is presently available to those families which have not broken down should be removed on some income test basis. The position can become confused, because it can be presented, in a sense, as a welfare issue instead of as a fairness issue. But the basic point that the Opposition is putting is that if two individuals are on the same income-be it $5,000, $10,000, $20,000 or $30,000 a year-but with quite different responsibilities for the care of other people, those people have a quite different ability to pay tax, and they have a quite different ability to contribute. That difference should be acknowledged in the tax system or the social security system, or both. We are not arguing that there should not be additional assistance for those who are in need. We are saying that where we have taxpayers whose income is equal, we should make some differentiation in favour of those who are maintaining family responsibilities. I hope there will be support for that from the Government. I am fortified in this hope by what Senator Grimes, the then Minister for Social Security, said to the economic summit in April 1983. I quote from page 70 of the transcript of that summit. One finds coming from the mouth of Senator Grimes very similar views to those I have been trying to express this afternoon. He said: On family allowances, there is frequent criticism of the cost of this system, currently about $1.5 billion a year. It is often forgotten, however, that family allowances are not and were never meant to be a welfare program in the strict sense. Rather, they are designed to achieve a broad measure of equity in the tax transfer system between those with and those without dependent children. They recognise that at any level of income- I repeat those words for Senator Walsh: 'At any level of income'. To continue: . . . those with children face higher costs than those without. Senator Grimes continued: Seen in this light, family allowances offset to some extent the tax liabilities of those with children so that their net contribution to revenue is reduced in reflection of their lesser ability to pay. That position, of course, was altered-I believe to the good-by the Fraser Government in 1976 when my colleague Senator Dame Margaret Guilfoyle, who will speak later in this debate, was Minister for Social Security. Until 1976 we had the odd circumstance that higher income taxpayers received greater direct benefit because part of the benefit was delivered as a tax deduction rather than as child endowment. The change which was made by Senator Guilfoyle ensured that high income and low income families received the same net assistance through the family allowance system. That, of course, was a progressive, not a regressive, change. I do not believe that that change should be used to take the further step of then removing all assistance to those families who were, at some point, described as having a high income. Senator Walsh, in some of his contributions, has suggested that any taxpayer with an income of more than $22,000 might be considered to be in that category. We think that would be thoroughly wrong, unjust and unfair. Senator Walsh —They are in the top 20 per cent. Senator CHANEY —That comment flies in the face of the fact, which is well known to Senator Walsh, that those strict cash incomes are, in any event, a very imperfect measure of the resources available to particular families and that many people would still qualify under the sort of test he is suggesting but, certainly, would not be in the category of people who are particularly well off. I do not have time to refer in detail to the policy papers which have been issued by the Opposition in the fields of tax and social security. All I need say is that in those policy papers we have thoroughly acknowledged the differential ability to pay which was stressed by Senator Grimes. I quote one paragraph from our tax policy. We said: A basic characteristic of an equitable tax system is that those with a lesser capacity to pay tax should face a lower tax bill. Clearly there are additional expenses involved in raising children, and families with children have a much reduced capacity to pay tax. In part, this is reflected in the provision of family allowances to all families with children, as well as in the provision of the dependent spouse rebate at a higher rate to one-income families with children than to those without. I believe it would be a help to the tax summit if in the plethora of views which are floating around at the moment we had some indication from this Parliament of what is acceptable and what is not. In bringing forward this proposition, the Opposition is simply putting the view that it is not acceptable to produce a tax and welfare mix which, in the end, will ensure that in Australia taxpayers with equal income but with totally different family responsibilities are treated in the same way. We see that as being a breach of principles of justice which should apply, and as being quite wrong. I stress that in bringing this forward we are not simply relying on newspaper reports. As I said earlier in the debate, on 21 March Senator Walsh, in response to Senator Maguire, indicated that he thought there was a prima facie case for means testing the spouse allowance. In our view that prima facie case has not been made out. The words which I have quoted and which were uttered by Senator Grimes at the summit are far better guides. The tax summit and this Government should not proceed down the track of saying to families that unless they are poor they will receive in the Australian system no acknowledgement of the differential ability to pay. If we place the value on the family that we all claim we do in our flights of rhetoric, we will acknowledge the costly responsibilities which are assumed by people in family circumstances in which they look after dependants and we will differentiate between those who do adopt and maintain those responsibilities and those who do not. Senator WALSH(Western Australia-Minister for Finance)(3.25) —It is a bit of a mystery to me why this motion has come up at all, although it is possible that it has been raised because of the gross distortions and works of fiction disguised as news reporting which have appeared in the Murdoch Press over the last week. I will give some specifics of that later. Essentially, Senator Chaney is proposing that the taxation system ought to contain a principle of horizontal equity and that the social welfare system, which he called the fairness system, of child allowances and family allowances should also take account of horizontal equity. Two things arise from that proposal. First, it is not disputed that horizontal equity is a factor which must be taken into consideration. It could be argued, however, that horizontal equity is not so sacrosanct that it must at all times and in all circumstances be allowed to crowd out any other equity consideration. More importantly, given that Senator Chaney has moved this motion, is the fact that the Fraser Government, I think when Senator Chaney was the responsible Minister, means tested family allowances, only it called them family income supplements. Senator Chaney —It was assistance to low income earners, that is, a welfare proposal. Senator WALSH —It paid those family income supplements to low income families, so the principle of means testing family allowances was not only endorsed by the last conservative Government but actually enacted by it. I believe it did so when Senator Chaney was the responsible Minister. He wants to call family allowances something else and say that they are a form of special assistance to low income families and so on. Is he asserting that the present standard family allowance rate or that which prevailed when he was the responsible Minister is or was beyond all doubt the appropriate family rate? Is he claiming that the increments in the present rate for each additional child are perfectly correct and that there is no case to be put for their being more or less? Senator Chaney shakes his head. He is not arguing any of those things. He is not arguing that by some quasi arbitrary process a figure has been arrived at which is beyond dispute, beyond contradiction, beyond criticism. So I am afraid that my confusion has not been cleared up at all. Of course the principle of horizontal equity should be taken into account. That is the principle that some allowance should be made in recognition to the fact that some people have equal cash flows or equal taxable incomes, but have unequal obligations or responsibilities. We agree with that; nobody has ever suggested otherwise. The motion may have been stimulated, as I said earlier, by some works of fiction described as news reporting from the Murdoch Press in the last week. I will expand on that in some detail. There were a number of false or misleading statements in the Australian and the Daily Telegraph of last Friday, and also in the Sunday Telegraph of last Sunday. I will give details of those in the order in which they appeared. In Friday's Australian it was said that the Government was considering this: . . . sweeping changes to the dependant spouse rebate which could see up to one million families lose the benefit in the August Budget. The fact is that that could only be correct if the rebate were abolished for five-sixths of the present recipients. As far as I know, there has been no suggestion from anybody that that should happen. Another quote from the Australian reads: Under the proposal being examined by the Expenditure Review Committee-or razor gang-the Government is considering withdrawing the rebate from high-income families. Honourable senators should remember that that statement was made in the context of the Australian purporting to be reporting on an answer by me to a question from Senator Maguire. The fact is that the Expenditure Review Committee is not examining any such proposal and, of course, I did not say that it was. The Australian also stated: It is understood the proposal could save about $300 million in 1985-86. When answering Senator Maguire's question I stated that the whole scheme-that is, the dependent spouse rebate-cost about $900m. The figure of $300m appears to be a completely fictional figure which has been plucked out of the air by whoever wrote the story. In any case, if the assumption made in the first quotation about the one million families was correct, the saving would have to be somewhere near $900m. So, skilful writers of fiction though Murdoch journalists may be, they are innumerate. It should be noted that in my answer to the Senate I clearly stated: Should the Government make such a change-I am not suggesting that it will do so . . . That is a quotation from Hansard which, of course, did not appear in the Australian since the quotation relates to reality and fact rather than fiction. The Murdoch Press prefers the latter. I would have thought that that statement would have made it obvious that no decision of this kind has been taken by the Government and that I had been discussing the issue in a detached way in attempting to give an honest and serious answer to an important question. The Murdoch Press's reporting of the matter will not encourage me or any other politician to do so again. The two newspapers-the Telegraph and the Australian-treated the story in a grossly unprofessional manner. There was no basis in fact nor any conclusion which could have been drawn from my statement for the claims made under the guise of being a news report. The last issue of the Sunday Telegraph, which is out of the same stable, ran a story which likewise had no basis in fact. it may be instructive for me to give a somewhat detailed account of what I know about how it happened. The cousin or sister publications, the Australian and the Daily Telegraph, ran their stories on Friday and the Sydney Daily Mirror and Adelaide News ran similar stories on Friday. They are all from the same stable. (Quorum formed) Last Friday, after the various Murdoch newspapers in Sydney and Adelaide had published their creative stories about the dependent spouse rebate, my office received calls from Murdoch journalists seeking comments on whether the family allowance was being considered for means testing. They were told very firmly that no comments could or would be made about that matter. Both journalists stated that they had been instructed by their editors to get a story on means testing the family allowances. One of them even went on virtually to threaten members of my staff that a story would be written whether or not I was prepared to provide any information or comment. Even so, I was still surprised to find thoughts and intentions attributed to me all over page 1 of the Sunday Telegraph. No doubt out of a proper sense of modesty, there was no by-line on the story. It appears that whoever wrote the article-I cannot be certain that the journalists who came to my office and sought comment from me on Friday actually wrote it-had simply made it up. Some illustrative figures which I had used in my examination of the spouse rebate had simply been transferred wholesale to family allowances. I have gone into this matter in some detail in order to demonstrate, firstly, that the creative writing of the Murdoch Press may have misled the Opposition to some extent and therefore helps to explain Senator Chaney's peculiar action in raising this matter of urgency today. However, Senator Chaney said some other things upon which I wish to comment. In a way it makes it even more surprising that the Opposition should have raised the matter that, apparently, it has not determined its views on the very subject which Senator Chaney has raised. On 10 March, Mr Peacock spoke on the Sunday program about the dependent spouse rebate. There was a question cum assertion from Robert Haupt that Mr Peacock had in the past advocated means testing the dependent spouse rebate. He was asked where he stands now. Mr Peacock stated: Yes. In fact we see some merit here. That is, some merit in means testing the dependent spouse rebate. He said that on 10 March. He went on to say: . . . I'm not surprised, in fact a number of us indicated not only when we were in Government but also in the first year that we were in Opposition that we would favour an examination in this arena. It is true that that was in the past tense. In government and in the first year in Opposition, Mr Peacock did not resile from that position. Moreover, on 10 March he said: 'We see some merit in means testing the dependent spouse rebate'. I can only assume that at that time Mr Peacock was expressing his own views and that yet again he was subsequently rolled by the Sydney faction of the Liberal Party of Australia. The Liberal Party had one policy which was enunciated on Sunday, 10 March by its nominal leader and it now has some other policy, presumably because the Sydney faction of the Liberal Party has, once again, rolled Mr Peacock. Perhaps the confusion is such that the Liberal Party cannot tell the difference between Mr Peacock's 10 March policy and the policy which it had advocated at one time in the past-that is, income splitting, which by definition cancels the dependent spouse rebate out of existence and with which I presume Senator Chaney was aligning himself today. I can say one thing for anybody who is concerned about equity. The income splitting proposal is not an effective means of enhancing equity; indeed, it is quite the opposite. Senator Harradine is attempting to interject. His is a case which is highly relevant to the point I am about to make. I am not sure precisely what Senator Harradine's salary is, including tax free allowances and travelling allowances, but it would be in the vicinity of $60,000. A wholly taxable salary equivalent would be in the vicinity of $80,000 or $90,000. Senator Harradine is listed to speak on this matter of urgency. He has a number of children, both his own and those of a step family, if that is the correct term to use. I therefore presume that he receives a very considerable family allowance. I do not know what the figure is, but I invite Senator Harradine to tell the Senate what it is. It is likely to be of the order of $100 to $125 a week tax free. I am not suggesting that people with a number of children should not get assistance for having dependants, but it raises the question as to whether anyone on Senator Harradine's salary should receive additional tax free payments of that magnitude. Senator Harradine —Well, of course, I do not get them. Senator WALSH —I invite you to tell us what they are. You are certainly entitled to some payments. Senator Harradine —I do not receive a cracker, not a brass razoo. Senator Ryan —His wife gets it. Senator WALSH —Perhaps Senator Harradine will tell us how much his wife receives in family allowances if he wishes to push the issue off the agenda in that way. According to the very conventional Christian view of marriage which Senator Harradine advocates and believes in, the couple are inseparable and indissoluble anyway. He believes that a married couple are a legal and almost a physical unit as well- Senator Harradine —Why does the Government not tax them as a family unit rather than the individual? Senator WALSH —There is something to be said for that, but the point I am making is that I believe, this Government believes and apparently the Opposition believes that the principle of horizontal equity in taxation and other policies should be taken into account. It can be argued legitimately that that principle is not so sacrosanct that at all times and under all circumstances it should crowd out every other consideration. I suggest that Senator Harradine's case is one in point. In Senator Harradine's family unit his taxable equivalent income is of the order of $90,000- Senator Harradine —It is not. What are you talking about? Senator WALSH —I said that the fully taxable income equivalent is of that order. Senator Harradine —It is not; it is $36,000 and you know it. Senator WALSH —Perhaps it is $80,000. Obviously I have touched a sensitive nerve because Senator Harradine was about to sermonise and pontificate in his usual way about the morality of this question, yet he does not want to have investigated whether someone on his salary, or a family unit with his family unit income, should receive in addition family allowances of the order of those that I have suggested-moreover, tax free. Anyway, Senator Harradine has obviously taken the point and I invite him to provide the precise details as to what is received by his family unit, by way of both salary and family allowances. I am not having a shot at Senator Harradine. I am drawing attention to a very real issue and the equity consequences involved-whether people on Senator Harradine's salary, even though they have many dependent children, should be entitled to other payments of that magnitude in addition to salary when there are people living in poverty. The figures of the number of people in poverty vary according to the estimate one chooses to use. For example, the Brotherhood of St Laurence-a body which has an emotional commitment to welfare issues and therefore, perhaps, in its judgments it is somewhat swayed by those commitments, so perhaps the figure it has produced is somewhat exaggerated-suggests that about 500,000 children are being reared in poverty. A great number of those, it claims, are suffering actual malnutrition. If that is accepted as being an approximation of reality it raises very serious questions as to whether people-family units, if you like-with the income that Senator Harradine's family unit has, even though it has a large number of children, should also receive tax free family allowances of the order of $100 to $125 a week. The Government certainly will not oppose this motion. I do not expect there will be a division because I do not think anyone will oppose it, but I am still mystified as to why it was moved. Senator HAINES(South Australia)(3.46) —The Australian Democrats will support the urgency motion which is before the Senate today. There is absolutely no question at all about the justice of the concept that there must be provision in the tax and social security systems to allow for the additional responsibilities of those with dependants. That, of course, is the nub of the motion that Senator Chaney has put before us today. The question that arises is not, I would hope, whether these provisions should exist but what the provisions should be. I suggest that that is the source of the kite flying to which Senator Chaney referred in the first part of the motion. If we argue that there is a limited cake to be distributed by governments in the area of tax cuts, social welfare payments and so on-and listening to some Opposition members in a debate yesterday and their comments about deficits I was left with no doubt that they believe that a limited cake is available-the argument stems not from whether provisions should be made but how those provisions should be distributed. The Australian Democrats have always argued that in the case of limited funds being available, those who are in most need should have first access to the available funds. I doubt whether there is anyone in this chamber who would disagree with that. Unquestionable and beyond doubt is the fact that those in most need are families with dependent children and, in particular, pensioners and low income earners with dependent children. Last year the Australian Democrats put forward a notice of motion indicating some areas in which we felt the social security and taxation systems could be used to improve the lot of those people in poverty and in particular those on low incomes with dependent children. Our suggestions included fairly basic things, such as increasing the child allowance for pensioners, increasing the family supplements, additional supplementary rent allowance to families whose breadwinner was unemployed, increasing rent allowances to families with children and tax equity measures including tougher provisions against tax avoiders, a tax on windfall and speculative gains, reduced income tax and increased consumption taxes except, of course, on the necessities of life, which we opposed in 1981-82 and will continue to oppose on the ground that there is no way that we can see of off-setting those costs to low income families, particularly those with children, with any formula of benefit. We costed those not excessive requests to a government which sees as a high priority income support for those in need and particularly income support for families with dependent children. It is fairly well known to most members of this chamber that in the event of there being no additional assistance provided by governments, I have expressed personal support for the redistribution of money that is currently spent on the dependent spouse rebate to family allowances. Again I say that that must be taken in the context of there being a specific and limited cake to be distributed. While I accept that it is abhorrent to have to trade off these sorts of supports, it is nevertheless a fact of life in all budgets that when somebody gets more, somebody else has to get a little less unless there is to be the massive deficit blowout that some members of the Opposition so vehemently decried in the Senate yesterday. I share with people like Senator Chaney a commitment to families with dependent children and believe that they must be any government's top priority. As the parent of two teenage children, I have observed from some years of horrified onlooking at our budget that children are not cheap. I sometimes suspect that if people worked that out before they launched into having large families perhaps the families would not grow to the extent that some of them do. They are a huge drain, lovely as they are, on the budget of any family and, of course, the smaller the budget the worse the drain. A recent Institute of Family Studies report indicates the cost of children, and it is a substantial cost. The findings suggest a need for governments to rethink the basis on which social security pensions and benefits are made and to take a new look at maintenance awards made for children in the Family Court of Australia and magistrates courts. The media release put out by Dr Don Edgar includes this statement concerning the figures that the Institute released: They are, however, 'basic survival' figures which cannot be challenged on the grounds of being over-generous. Any allowance which falls below these estimates is likely to mean real poverty for the child and the family concerned. The release went on: The study, compiled by Ms Kerry Lovering, Senior Research Fellow at the Institute, shows that basic food costs per week vary from $10.59 for a two-year old to $16.23 for an eleven-year old child. Minimal clothing purchases for children amount to a weekly average of $2.24 for a two-year old, rising to $3.67 per week for an eleven-year old. When some additional costs are added for toys, gifts, pocket money, household provisions, heating and school trips-- all calculated, according to the Institute of Family Studies, at bare minimum figures-- the total costs per week for children range from $16.69 at age two, $21.41 at age five, $26.25 at age eight and $27.86 for an eleven-year old. For 'middle income' families these costs range from $25.11 for a two-year old to $45.90 for an eleven-year old. I repeat that they are per week figures. Not surprisingly, as I have observed myself, teenagers cost even more-ranging from $2,156 per annum for low income families to $3,588 per annum for medium income families. Those are not the sorts of amounts that families, particularly with large numbers of children, can afford to part with easily. Despite all this, the tax and social welfare systems in this country tend to be skewed against families with dependent children. This includes families with a sole supporting parent, who of course does not qualify for the dependent spouse rebate since he or she does not have a dependent spouse for whom to get the rebate. Families with large numbers of dependent children are allowed a pitiful tax deduction for the education expenses of those children, and families with low income levels in which both parents must work-so that they too are not eligible for the dependent spouse rebate though they are still on very limited incomes-are not entitled to claim child care as a tax deduction since that is still not seen by the powers that be as expenditure incurred in earning an income, notwithstanding the fact that those old steadfast businessmen's lunches and so on are classified as expenditure necessarily incurred in earning an income. On the other hand, the husbands of a large number of families with no children receive $830 a year as a direct gift from the Government via that dependent spouse rebate. If we are looking as a top priority at families with dependent children-that is what Senator Chaney indicated the Opposition was looking at, and we fully support that-and if we have a limited budget, we must look seriously at redirecting tax and welfare benefits from those who do not need them to those who do. If, for example, the nearly $1 billion we spend on the dependent spouse rebate were directed into the family allowance that allowance would double. There is no question that families with dependent children would benefit from that. An additional benefit would occur if the allowances were taxed in the hands of the recipient parent. A moment ago Senator Walsh challenged Senator Harradine to indicate just how much he earned from his family via the family allowance and Senator Harradine pointed out, quite rightly, that it is not he who receives any money but his wife. In his particular circumstance, and presuming that his wife is not in receipt of any other income, the family allowance would stay with her. High income earners, such as I would classify myself, or recipients of the family allowance who are able to take part in family trust arrangements thereby cutting back their tax payments, would have their family allowances taxed when they received them. Therefore some of that money would go back to the Government with attendant benefit if it were directed to others. People argue-I think Senator Walsh was implying this-that the simple fact of Senator Harradine's high income should render his wife, or the wife of any other person in the same position, ineligible for the family allowance. I point out to Senator Walsh and anybody else who has that belief that unfortunately there are still families in this country in which the income earned by one spouse is not shared equitably, or in any other way, with the dependent spouse or dependent children. It is deplorable but that situation exists. If we are to look at people in need we have to bear that in mind. Senator Chaney pointed out that the family allowance was never intended to be a welfare payment but I am not sure, if we go back and look at the history of it, that he is precisely right. The family allowance was originally introduced- it was then called child endowment-under the Child Endowment Act which came into force in July of 1941. That Act provided a small payment of 50c a week for each child after the first one under the age of 16 years. There were a number of reasons for excluding the first child, including the fact that the cost of the scheme would have been doubled. Senator Messner —Populate or perish. Senator HAINES —In regard to the populate or perish principle, as Senator Messner points out, this payment was probably another argument for encouraging people to have larger families. The endowment was not means tested and it was available to all parents, employed or unemployed. The child for whom endowment was claimed was required to have been born in Australia or to have resided here for 12 months. There were a number of other eligibility requirements. When the scheme was introduced it offered substantial help to low income families with several children, although as the years progressed inflation tended to eat into it. On 20 May 1976 the then Treasurer of the new Fraser Government, the late Sir Phillip Lynch, announced a number of fiscal policy decisions to be introduced by his Department in the new financial year, including a scheme of family allowances designed, as he said, to improve the lot of the disadvantaged in society at a relatively slight net cost to the Budget deficit. So certainly the Fraser Government in 1976 saw family allowances as some sort of welfare payment. I think we can be forgiven for casting family allowances in that light now. Senator Chaney refers in the first part of his motion to kite flying. He is an experienced politician and one does not have to be involved in politics for very long to know that kite flying, or what is more vulgarly called dead pig floating, is a familiar pre-Budget activity. Senator Walsh —I haven't heard that before. Is it a vulgar Adelaide term? Senator HAINES —It is a good South Australian expression. I would have thought most South Australians were familiar with it from the State Government area. Perhaps it comes from my involvement in State politics. However, I agree with Senator Chaney that it is lamentable that these sorts of stories are floated by whoever sorts them out; they cut right across the spirit of the proposed tax summit. All parties, all groups, have some idea of what they want as far as tax and social welfare concessions are concerned. The Liberal Party has made no secret of its commitment in some areas to income splitting and I have indicated today some of our commitments. Nevertheless, in general these sorts of things do get about. They have to be accepted but they should not be used to sink the tax summit. As I said earlier, the Australian Democrats fully support the urgency motion before the Senate. Senator Dame MARGARET GUILFOYLE(Victoria)(4.00) —The Opposition has brought forward this matter of urgency for discussion today. Information has been given by Senator Chaney, and by Senator Haines on behalf of the Democrats. I think it is fair to say that the matter has been brought forward in the climate of a great deal of discussion, not only in the pre-Budget context, as is usual, but also in the context of matters that will arise at the tax summit to be held in July. Senator Chaney introduced the matter by saying that there were confusing signs in the electorate with regard to statements that have been made by members of the Government. I noted that Senator Walsh is outraged or disturbed at the way in which he has been reported by one section of the Press. I would say to Senator Walsh that, if he checks the Hansard very carefully, he will find that what he has said today has already provided the headlines for tomorrow's Press-not just the Murdoch Press, but all members of the Press-with some of the kites he has flown in this debate. He has described the way in which he was misquoted on statements he made earlier. In the Senate on 21 March, in answer to a question from Senator Maguire, he said: In other words, one-sixth of the highest taxpayers received one-third of the rebate. It could certainly be argued, I believe, that that provides a prima facie case for means testing. The argument commonly cited against means testing such a rebate is derived from the principle of horizontal equity in taxation matters, but whether horizontal equity ought to take priority at all times over all other equity considerations is something which could perhaps be questioned. He made a similar comment again today, when he said: 'It can be legitimately argued that horizontal equity should not crowd out other considerations'. Therefore, I think he places very firmly one attitude he has expressed on these matters as a member of the Government. He described the matters before us as being treated as works of fiction by the Murdoch Press, and he says that no decisions have been made by the Government. That is probably an accurate statement. We know that we are in a pre-Budget context and no decisions have been made, but it is usually wise for members of the Government not to make statements in the way Senator Walsh does in the pre-Budget context. If they make such statements, they should expect to be quoted. As a Minister, I found that if anyone talked of something being reviewed, one could expect a headline that it was going to be cut. 'Review' meant 'cut', particularly with regard to welfare matters. When one makes statements expressing one's own views, and a number of Ministers have made statements on those matters, one can expect to be quoted. There is intense public interest in a matter such as a universal family allowance scheme. The statements made by Senator Walsh today ignore the fact that the family allowance scheme is universal. It was introduced as a child endowment payment and it was changed by the Fraser Government in 1976 to a universal family allowance, which gave recognition to the additional costs of dependent children in a family. We do not argue that the payments are perfect or that there is no way in which family allowances could be changed, but I think there is a fairly substantial view in the Australian community that the universality of the family allowance scheme ought to be protected. It gives recognition to the fact that people on the same income level have different responsibilities with regard to the care of dependants in their families. The whole matter of taxation and social security policy needs to recognise the dependants within the family unit. It was in that spirit that the matter was brought forward by Senator Chaney on behalf of the Opposition. It is timely, in the weeks before the tax summit when issues are being raised and submissions are being received by the Government, that the Senate should look at whether there is to be recognition of dependency and whether families, which may have the same level of income but very different family responsibilities, need to be considered at the time any changes are being made arising from policies that come from the tax summit. Senator Walsh again talked about something which the Leader of the Opposition (Mr Peacock) was reported as having said on 10 March on a television program. Clearly, the Opposition policies on the spouse rebate and tax were set out in the taxation policy of the Opposition parties which was released prior to the last election. I will say more about that later. A restatement on a daily basis by Senator Walsh of something was reported that from the Leader of the Opposition on 10 March ignores completely the public document which has been released by the Opposition and which is the Opposition's policy on these matters at present. An interesting speech was made by Senator Walsh on 22 March to the Commonwealth and State women's advisers on the matter of equity, taxation and government expenditure. I was interested to see the figures he cited, which were, to my recollection, figures I had as Minister for Finance, with regard to levels of tax and the rates of tax which people actually pay, contrary to the beliefs they may hold about what they do pay. Page 2 of that speech-again it gives rise to the sorts of headlines he receives from the Press-stated: Nevertheless, it is the view of the Government-and this view has been formalised-if you like-by our commitment to the 'trilogy'-that there are some existing programs on which public funds are spent; their continuation cannot be justified; they are programs which ought to be eliminated or reduced. Some significant expenditure cuts must be made if we are to meet the 'trilogy' commitments. That is a very public statement. If Ministers of the Government go about making the sorts of statements Senator Walsh makes with regard to horizontal equity and things he believes ought to be means tested, they can expect between now and the summit, or now and the Budget, to receive the sort of Press that has undoubtedly disturbed him. One matter that ought to be commented on is the tax mix and the statements made by all parties prior to the summit. The coalition parties in our released policy have stated that we believe not only that the current overall burden of taxation is too high, but also that the taxation system is in need of reform. We outlined our own policies and made the comment that we believe Australia has an excessive and growing reliance on personal income tax. Labor's Budget figures show that relative to gross domestic product Labor's tax measures will increase personal income taxes to an historically high level in this financial year. Labor is raising significantly more than half-a record 53.1 per cent-of its total receipts from this type of tax in this financial year. It is in that context that people welcome open discussion about the way in which our tax system is to take shape in the future. The growing reliance on personal tax has a number of undesirable consequences. My own Party and the coalition believe that that ought to be reversed. Because of inflation and the way in which more and more people are moving into higher tax brackets people are paying higher tax rates on increased incomes. This means that their real purchasing power or economic well-being is suffering from the inflation creep and the way in which they move into the higher tax brackets. In particular, this affects people who are on a little above average weekly earnings who have family responsibilities and who often have a dependent spouse. In that context, when we are looking at changes to the tax system, we must recognise that the great majority of people who earn a little above average weekly earnings and who have family responsibilities will be looking to the Government and the result of the tax summit to alleviate some of their burden. The rising share of income tax in particular has hit families particularly hard. I think it is fair to say that a basic characteristic of an equitable tax system is that those with a lesser capacity to pay should face a lower tax bill. I do not think anyone could argue with that. Senator Haines and Senator Chaney have given statistics from the Australian Institute of Family Studies that show the real cost of children, quite apart from any hidden costs. The provision of family allowances to all children-that is, a universal family allowance-is one of the ways in which recognition has been given throughout the years to that responsibility that is accepted. The dependent spouse rebate has been a recognition of the dependency of a spouse in a family unit. It is probably timely to note our own policy on that matter. We believe that where changes can be made in that direction primarily they should benefit families with dependent children. It could not be argued that the family allowance, since its inception in 1976, has maintained its level of support, but it is very costly to do that. I think successive governments would always see it as something that would be increased from time to time, however much people might wish to see it increased on a regular basis. To have a fairer tax system would mean that we should be making a significant step towards income tax justice and income tax relief, especially for families with children. There are real social changes that affect many Australian families. Again, some of those statistics have been given by earlier speakers. I do not speak particularly of those who are in a family breakdown situation, but rather those families who are accepting their own responsibilities, trying to meet their commitments and give opportunities to their children. Changes have been made in families in Australia where many Australian mothers have entered a career. It is an important aspect of their lives. It is important because it brings in an income and it is important also because they see a career as a significant element in their individual lives and seek their own fulfilment and potential through their career as well as accepting their family responsibilities. That is why in the tax policy of the Opposition we brought forward a proposal to introduce income splitting and give relief to families in two ways: Firstly, through the introduction progressively of income splitting; and, secondly, through the progressive introduction of tax rebates for child care expenses. That policy is a public document and is there for anyone to look at and to see the way in which the policy would be introduced and progressively dealt with to provide greater equity and recognition of the responsibilities of people with children or those who have some dependants in their family. We are receiving, as are most others, numerous submissions. I was interested in a submission by the Australian Family Association to the national tax summit. That Association believes that the tax summit should: endorse family income splitting for tax purposes, in the interests of both tax equity and economic efficiency; oppose the imposition of a consumption tax, which will severely hit families, especially single income families, while at the same time not touching foreign investors or the savings of the affluent. The Association went on to outline its support for the proposals and noted the present situation whereby only wage and salary earners are denied access to income splitting. It felt that that was grossly unfair. I am sure that in the coming weeks and months we will all receive submissions from all the associations that have an interest in these matters. It was for that reason that Senator Chaney and the Opposition wished to put before the Senate, for an expression of its view today, the proposal that where changes are being considered-either in the Budget context or in the tax summit context-to matters of social security or matters of taxation, recognition be given to the responsibility that is accepted for dependants in the family unit and that this recognition be expressed in the policies that may be adopted as a result of the changes that are decided upon by the Government. Senator MAGUIRE(South Australia)(4.15) —I oppose the motion which has been moved by Senator Chaney. This urgency motion claims that the Government is looking at means testing dependent spouse rebates and family allowances and that, in consequence, those persons with dependants will somehow be hit. I think it is one of the most ill-informed motions I have seen since becoming a member of this chamber. To start with, I can see two gross errors in the motion. Senator Chaney should sack his speech writer for the errors which are contained in this motion. For example, all senators must know already that the dependent spouse rebate is subject to a means test; it has been means tested for many years. Senator Chaney should know that. Also, the motion refers to a supporting spouse allowance. In fact, it is a taxation rebate. It is a rebate against a taxation liability-it is not an allowance. Perhaps there is a little bit of a Freudian content in that slip. Perhaps Senator Chaney supports conversion of the dependent spouse rebate to a cash allowance. He may have recommended that in his previous years as a Minister. I think it is a gross error to come in here and suggest that we are trying to means test the so-called supporting spouse allowance when it has been means tested for many years. Senator Chaney —Get on to the substance. Stop playing like a Philadelphia lawyer. Senator MAGUIRE —Having copped that, Senator Chaney might perhaps listen to some of the points that have been made against this motion. This motion stresses, very much indeed, the concept of horizontal equity; that is, the fair treatment of taxpayers with similar incomes but with different family circumstances. Of course there is another aspect of equity; that is, vertical equity, which is the fair treatment of those with different incomes. That particular equity principle is associated with the ability to pay principle, with progressivity in the taxation system. We, in the Labor Party, do not deny that horizontal equity is one equity principle, but we also say some attention should be paid to the concept of vertical equity as well. We believe that persons on higher incomes should pay more. This motion is very much framed in terms of horizontal equity. There is absolutely no reference to concepts of vertical equity. I only wish that members of the Opposition could be somewhat more consistent in referring to horizontal equity concepts. While they choose to use it as the basis for a motion such as the one we have here today, they certainly do not follow it through. They are not consistent when it comes to various types of income. For example, they parade around the country making noises about alleged taxes on capital gains and so forth-capital gains being one form of income, earned income being another form of income-but the horizontal equity principle does not apply universally, for example, to those persons whose income is in the form of capital gains. They are not taxed as are the rest of the community who receive their income as a result of their labours. As I indicated, this motion is very much about horizontal equity. I find it a surprising motion in contrast to the statement made by Mr Peacock on 10 March, when he stated: The coalition would review the spouse tax rebate to determine whether it should be means tested. I believe Mr Peacock said that on the Sunday program. I read the report in the Sydney Morning Herald on 11 March. (Quorum formed) Before I was interrupted, I was pointing out that Mr Peacock stated: The coalition would review the spouse tax rebate to determine whether it should be means tested. That is a direct quotation from the Leader of the Opposition. We in the Government assumed that that statement was genuine. After all, such a statement by Mr Peacock was consistent with his 1981 resignation statement. When Mr Peacock resigned from the Fraser Ministry, if I recall correctly he indicated in his resignation statement that the income support system should be put more on a needs basis. Essentially, I think he was getting at the concept of vertical equity. Later in the week, on Friday evening, we read in the Adelaide News: Mr Peacock lashed a proposal to means test the dependent spouse rebate. Apparently he could not make up his own mind about what he wanted. In the space of 10 days he contradicted a statement of his own. Of course, it is not new for Mr Peacock to contradict his own statements. It is certainly not new for honourable senators opposite to do so. That is one of the major errors Mr Peacock has made in this field in the last month. The dependent spouse rebate and family allowances, which are the subject of this motion today, are very large Budget items indeed. The dependent spouse rebate costs some $900m to $1,000m annually. That accounts for some 40 per cent of the cost to the Budget of all personal income tax rebates. The dependent spouse rebate is larger where dependent children are concerned; it is $1,030. It is $830 in cases where there are no dependent children. I should point out that, prior to the Whitlam Government, the dependent spouse rebate took the form of a taxation deduction. It had greater value for high income taxpayers than for low income taxpayers because of the effect of high marginal tax rates in combination with tax deductions. The situation which applied under former Liberal governments, whereby the spouses of very rich taxpayers were worth more to them in terms of taxation savings than the spouses of lower income taxpayers, was highly regressive and inequitable. The Whitlam Government changed that situation from 1975. Of course, there were numerous screams and protests from those on the Opposition benches when tax deductions were scrapped and rebates were introduced for personal items. We introduced equal rebates for all taxpayers. I am sure that if the Whitlam Government had not made those changes we still would be facing a situation whereby spouses of wealthy taxpayers were worth far more to them than spouses of low income taxpayers. Despite the reforms made by the Whitlam Government, the dependent spouse rebate is still a tax item which involves a number of problems. For example, as an equal rebate it still reduces the progressivity of stated income tax rates. Also, there is the problem that persons with very low taxable incomes, whose tax burdens are not particularly high, do not get the full value of the dependent spouse rebate. Many taxpayers, with incomes of less than about $8,700, do not get the full benefit of that rebate There are also some glaring anomalies in the income test in respect of the dependent spouse rebate which I referred to earlier. For example, the income test reduces the value of the rebate by $1 for every extra $4 of income earned by the dependent spouse. I ask honourable senators to contrast that income test with the income test for pensions, where $1 is lost for every $2 of other income, and with the case of unemployment benefit recipients where in some cases $1 of benefit is lost for every $1 of extra income. The income test that applies to the dependent spouse rebate is very much more generous than that which applies to other social welfare payments. It seems unfair that such differences exist. The Auditor-General in an efficiency audit recently has referred to problems associated with the dependent spouse rebate. The dependent spouse rebate is one of those elements of taxation which have a number of problems associated with them. The Auditor-General rightly has identified the problem. A number of abuses occur each year whereby many taxpayers fraudulently claim fictitious dependent spouses to obtain rebates against their taxation liabilities. Of most concern, I think, is the fact that the taxation statistics made available to Parliament by the Commissioner of Taxation indicate that a high proportion of the dependent spouse rebate is going to very high income taxpayers indeed. I refer to the income year 1981-82. In that year, only 11.8 per cent of taxpayers had taxable incomes above $22,000. Yet some 36.6 per cent of that group, those with the highest incomes, claimed the dependent spouse rebate. But at lower incomes very few taxpayers claimed the rebate. For example, only 8.2 per cent of the 2.7 million taxpayers with taxable incomes under $12,000 received the dependent spouse rebate. Clearly, as the taxable income rises, the proportion of taxpayers claiming the dependent spouse rebate also rises. I also indicate that the story gets even worse in terms of the dollar value of the dependent spouse rebate which goes to very high income earners. For example, in the 1981-82 income year, the top 11.8 per cent of Australian income earners received 23.5 per cent of the Budget cost of the dependent spouse rebate. The top 11.8 per cent received $192m of the $800m cost to the Budget of the dependent spouse rebate. By contrast with that top 11 per cent, I refer to the bottom 11 per cent. The bottom 11.1 per cent of all Australian taxpayers received a minute 0.4 per cent of the cost to the Budget of the dependent spouse rebate. A paltry $3.4m went to that income group-those Australians most in need. Of all the household categories referred to by the Taxation Commissioner in his 1981-82 taxation statistics, it is very evident that taxpayers receiving the full dependent spouse rebate had the highest average incomes. They had incomes of 30 per cent above the Australian average. That indicates how the dependent spouse rebate is being focused at present on very high income earners. I turn very briefly to the subject of family allowances. It was correctly pointed out here earlier this afternoon that family allowances were introduced in 1976 as a trade-off for the abolition of child endowment payments and taxation rebates for dependent children. I should say that, thereafter, the record of the Liberals in this area is shoddy indeed. It is certainly not a good record. Family allowances were not increased to take account of inflation for a number of years. They were continually eroded by inflation over that period, despite the claims made by the Fraser Government that the introduction of family allowances was one of the greatest social initiatives ever taken in Australia. There was a 50 per cent rise in the consumer price index before the first increase was made in the value of family allowances under the Fraser Government. So let us not believe that those sitting on the Opposition benches, members of the Liberal Party and the National Party, are somehow champions of the family allowances system. They let the system be eroded by inflation over a number of years. In summary, there are clearly problems with the dependent spouse rebate and family allowances. The ACTING DEPUTY PRESIDENT(Senator Jessop) —Order! The honourable senator's time has expired. Senator HARRADINE(Tasmania)(4.30) —I rise to support the motion. I do so because the proposal to abolish or seriously undermine the dependent spouse rebate is a hare-brained idea. It has absolutely no hope of getting off the ground, as everybody knows, and it would undermine the prices and incomes accord. I will read from a Press statement issued yesterday, 25 March, by the largest union affiliated to the Australian Council of Trade Unions. That union indicated quite clearly that the suggestions would undermine the prices and incomes accord. I refer, of course, to the Shop, Distributive and Allied Employees Association, which is the largest union affiliated to the ACTU. Under the heading 'Re: Threats to abolish the spouse rebate' it states: Recent media reports have suggested that the Government is considering the future of the spouse rebate. One report in particular has suggested that a senior Cabinet Minister, Senator Susan Ryan,-- actually, I thought it was the Minister for Finance, Senator Walsh, whom we were talking about but apparently it is the Minister for Education and Minister Assisting the Prime Minister on the Status of Women, Senator Ryan- is advocating the complete abolition of the benefit and disguising the move by phasing out the rebate slowly or by removing it in conjunction with significant tax cuts. The Shop Distributive and Allied Employees' Association supports the retention of the spouse rebate because it constitutes a significant tax concession to single income families, particularly those with low incomes. The spouse rebate is worth $16 per week in the pay packet of a worker with a dependent spouse and $20 a week for a worker with a dependent spouse and children. One can imagine, if it were abolished, that there would be an absolute scream if suddenly the workers found that they were $16 or $20 a week worse off in their pay packets. The SDA went on to state: To abolish this tax concession, whether in one fell swoop or by phasing it out, is an attack on the take-home pay of single income families and is therefore a deliberate and serious breach of the prices and incomes accord. To abolish the spouse rebate and disguise the move by granting significant income tax cuts is equally a breach of the spirit and intent of the accord, particularly if the tax cut is accompanied by an increase in indirect taxes which hit low income earners hardest. Such a double slug against single income families would leave them worse off financially than ever before. Incidentally-Senator Ryan might be interested in this-an interesting feature is that it did make suggestions as to what to do with the spouse rebate and how to put it into the spouse's pocket which deserve further consideration. Senator Ryan —Oh, good. Senator HARRADINE —Yes; it is something that we can talk about. Incidentally, I mention to the Minister at the table, Senator Ryan, that I was not trying to be offensive to Senator Walsh. I was simply trying at the time to ask him, in an innocent way, whether he meant that that equity was a horizontal equity or a vertical equity question? Senator Ryan —I think Senator Maguire answered that question. We are concerned with both. Senator HARRADINE —Yes. But the point I am making is that Senator Walsh then, in his usual fashion, started to personalise arguments about a matter which is of great national interest. It does not matter what Harradine or his wife gets as far as that is concerned. But if that is the name of the game that sort of policy can apply to the de facto debate. I have rigorously avoided personalising that debate. I do not intend to personalise it. It could also apply to many other debates in this chamber. For example, it could apply to those Ministers, of which there are at least two, who have no dependent children but whose total income, with the income of their wives, is in excess of $140,000 a year. But I do not want to personalise those things. Senator Walsh has started that sort of nonsense; I just want to stop it right here. Where is the Senate paymaster? I must ask the Clerk at the table or the Clerk Assistant, Miss Anne Lynch, where the paymaster is. According to Senator Walsh, I am supposed to be getting 90,000 bucks a year. Senator Ryan —The equivalent. Senator HARRADINE —The equivalent? Well, I am not getting 90,000 bucks a year. I can tell the Senate that here and now. I am getting, I think somebody said, $41,000. Senator Lewis —You are getting that car that picks you up at the airport and brings you in here. That is what it is worth. Senator HARRADINE —Oh; that is it, is it? I am getting 41,000 bucks, I think, and it is taxed to the eyeballs-and so it ought to be. I presume that the figure includes the electorate allowance. I do not get that much in electorate allowance. I do not know what it is but I think it is $14,000. But out of that I am supposed to pay my electoral expenses, assist in paying my campaign expenses-bear in mind, of course, that I am an Independent-and help pay for at least one of my office staff. That is the situation. I am perfectly happy to open my books if anyone wants to look at them. I reckon I would probably be the worst off member of parliament. Apart from that aspect on which Senator Walsh was wrong, he went on to say: 'Look at all the family allowance Harradine is getting'. As I have said, I am not getting a brass razoo in family allowance. My wife happens to receive some family allowance. I will do a quick sum. She is receiving about $150 a month less than what Senator Walsh was talking about. But my wife is doing what for her is absolutely the most important job in the world: She is nurturing and raising a very large family. Senator Walsh should not be criticising what she gets or personalising this debate. I should let her have an argument with Senator Walsh; I think he would come off worse. She is up at the crack of dawn and does not go to bed until midnight or afterwards. What are people like her right throughout the country contributing? They are contributing $64 billion to the gross domestic product-and it is not recognised. For Senator Walsh's information, I knew what my wife's work entailed when Barbara died in 1980. I knew what it was when I was left with a family of six. I knew what the mother did in the home. I knew it before she died, but it did not come home to me until after her death. But, my word, one certainly knows what the situation is then, not only in emotional but also in economic terms. Talking about social welfare, we can take the case of a widower with six children receiving the supporting parent benefit and a widow with seven children receiving a widow's pension. When such a couple get married what do they save the taxpayer? Senator Townley —Tell us. Senator HARRADINE —They save the taxpayer an amount of $20,061.60 a year. The Treasurer, Mr Keating, should give me a medal. That is what such a couple save the taxpayer. That is the situation if the widower is receiving the supporting parent benefit. But, of course, I was not receiving that benefit. In my actual case we saved the taxpayer nearly $16,000 a year. Senator Walsh should have another go. He should not personalise these things. It is not a matter of what I get or what anybody else gets. I stand here for the people who believe that it is important to recognise marriage and to recognise the family as the fundamental group unit of society. We have to have equity there. As the motion says, there must be recognition of the additional responsibilities of those with dependants. If Senator Walsh is going on that track, why does he attack the most important business in this nation? Senator Ryan —He did not. Senator HARRADINE —He is attacking it, and so is Senator Ryan. This is not done to business, is it? The Government does not say to a business, 'Oh, you are well off, so we shall charge you an extra amount of primary tax'. The Government imposes the same amount of primary tax whether the business is well off or is not well off. The Government is now attacking the family, the most important business in Australia. Why does the government not take that approach to business and differentiate between well-off business and not so well off business? Let us hear the answer. It will not come, because I do not think that the Government has thought the matter through to that extent. I take the stand of the average family, which is alarmed at these further attempts to undermine its viability. A major part of my concern is the low income families. Unfortunately, time does not allow me to point out what would happen to low income families if the hare-brained idea of abolishing spouse rebate and transferring it into family allowances got off the ground. The lower income families would be the ones affected. I refer, of course, to Senator Walsh's answers to questions Nos 866 and 867 of 7 June 1984. I do not have time to go into them now, but honourable senators should look at them. There it is analysed what families are receiving. The Government should not abolish the spouse rebate. It is a rebate and not a tax concession-with that I agree; it should be a rebate and not a tax concession-and, therefore, to the lower income family it means a heck of a lot more than it does to the higher income family. If the Government is looking at these sorts of things, I invite it to consider for tax purposes the income of the family unit. I should like to proceed with that subject, but my time has almost expired. I just regret that most of my time this afternoon has been taken up by an attempt to defend myself against a personal attack. That attack was totally unwarranted. All that I did was to ask Senator Walsh: 'Will it be horizontal or vertical taxation?' Senator RYAN(Australian Capital Territory-Minister for Education)(4.44) —This has been quite an interesting debate this afternoon. Comments have been made about the way in which the taxation system works, its defects and the possibility of improving it. There has not been a great divergence of opinion on basic matters concerning the taxation system. However, like my colleague Senator Walsh, I find myself somewhat bemused by the Opposition's decision to bring the matter forward. Senator Chaney —You should have listened to your mate; he opposes it. Senator RYAN —Senator Maguire has made it clear that there are some nonsensical aspects to the motion-for example, the reference to 'supporting spouse allowance'. There is no such benefit. It is rather surprising that the Leader of the Opposition (Senator Chaney) is not aware of the fact that there is no such thing as a supporting spouse allowance. But even leaving his little errors of drafting aside- Senator Chaney —Are you going to vote against it? Senator RYAN —Of course we shall not vote against the motion. Why should we do that? There is no substantive element in it against which we would vote. However, I cannot understand why the matter has been brought forward. There is extensive public discussion about taxation and the need for taxation reform. Who in this chamber will say that it is a bad thing, an undemocratic thing or a wrong thing in any way that our Government has initiated public debate about the taxation system? More than any other government in our history the present Government goes to great lengths to consult the public generally and to consult special interest groups about changes before they are formulated and introduced. When we do this and when we say that we shall not proceed immediately to changing the taxation system but will have open debate and will consult and invite submissions from anyone in the community who wants to make a submission to the Economic Planning Advisory Council, that we will have a tax summit at which all major groups in the community will have the opportunity to be represented, including the Opposition-although members of the Opposition have chosen not to take advantage of that invitation-when we go through these proper, open, democratic consultative procedures, which inevitably mean that there will be some proposals for change and some proposals for review, suddenly we are accused of doing something improper because matters are being discussed and reviewed in public. It does not make any sense. Senator Dame Margaret Guilfoyle might agree with me. In her contribution to this debate, she reminded us of how often the decision by a government to review something in the Budget context was represented in the Press as a decision to cut it. That is a distortion of the processes of debate, be they confidential processes, which is the case with Budget matters, or be they public debate, as is the case with the taxation situation. We cannot possibly have an open and democratic debate without examining critically some existing practices and provisions and without engaging in intelligent speculation as to how the system might be improved. But if every such discussion, review and proposal is to be taken up immediately as a threat, a cut or a decision to abolish, it bodes very ill for the continuation of open democratic processes. Senator Walsh, in his contribution to the debate, pointed out how seriously distorted had been several newspaper articles last weekend in regard to views that he might have expressed about the operation of the dependent spouse rebate. I shall not go over that ground again. But I would hope that the Opposition and non-government senators would seize upon the opportunity that the Government has presented us all with to have some intelligent and rational discussion about how we can improve our taxation system. Having sat in the chamber for a lengthy period this afternoon and having listened to the contributions, it seems to me that there is a measure of consensus in some fundamental ways. No one in this place has said that the present taxation system, in all respects, is totally equitable, it is perfect and it cannot be improved. Every speaker, from whichever part of the chamber the speech was delivered, said that there were defects, that there were matters which were of concern, and that there was a need for reform-and so speakers should, because no person elected to represent the people of Australia could come into this place and say that we have a perfect taxation system. One of the great problems of the Australian economy and one of the great problems for those of us who are concerned with equity is the inequity of the taxation system. We have had so many debates in this chamber alone about the attacks on public interest by tax evaders, and the huge amounts of money that are lost to public revenue every year because of tax evasion and avoidance. It is a well accepted fact that as far as the self-employed are concerned the payment of taxation is almost a voluntary act, so great now are the opportunities for tax evasion and avoidance and for tax minimisation. The result of that extensive avoidance and evasion is that those who cannot evade their taxes, the pay as you earn taxpayers, are under an undue burden of taxation. Even within that group of PAYE taxpayers there are distortions and inequities which work against the interests of the low income earners. I think we would all agree about that. Another thing we might agree about is that the shortfall in taxation revenue, because of this imperfect system and because of tax avoidance and evasion means that we are unable to spend on public programs the amount of money that is required if we are to remove the scar of poverty and disadvantage from our community. I do not think that anyone in this place would argue that there is an unacceptably high level of poverty in the community, both in terms of those who have no earned income and must rely on social security payments and in terms of those who have an earned income which is very low, too low to enable them to properly look after their families. We know that we need more revenue in order to eliminate proverty and that the shortfall in revenue is, to a very large extent, due to defects in the taxation system; therefore, we must all agree that reforms in the taxation system are necessary. I believe that it will be the major achievement of this Hawke Labor Government that we have initiated this significant reform and that we are proceeding with it in the open, democratic and consultative fashion we have embarked upon. I hope that we will achieve a very large degree of consensus at the tax summit on how to improve the equity and the efficiency of the taxation system, but we will not just move to that achievement of consensus without proper debate and discussion. In the present climate virtually every item that impinges on the tax system ought to be seriously assessed in terms of its equity and efficiency. Having made that generalisation, I must say that it is not the intention of the Government to means test family allowances, and I know of no proposals to do so. Senator Dame Margaret Guilfoyle had quite a deal to say about the benefits of universality in respect to that allowance. I will not disagree with what she said. In the very early stages of the debate Senator Chaney quoted Senator Grimes, who similarly is a supporter of family allowances. Senator Chaney drew the distinction between the universal family allowance and the family income supplement which goes to low income families, a decision of the previous Government and one of which we were not critical. Senator Peter Baume —Do you mean you supported it? Senator RYAN —Yes, but I believe that there are very large benefits in a universal family allowance system. Senator Harradine —Senator Walsh wants to means test it. Senator RYAN —I should like to make it quite clear that there is no proposal before the Government-no proposal from officials nor proposals coming from discussions within various groups amongst Government members-for the means testing of family allowances. As Senator Walsh pointed out, that was a misinterpretation of comments he made about the dependent spouse rebate. Senator Lewis —It is coming from Senator Walsh. Senator RYAN —There is no proposal under consideration by the Government to means test family allowances. Senator Messner —How do you know what Senator Walsh is up to? Senator RYAN —I know very well what Senator Walsh is up to. We spend quite some time discussing matters such as tertiary fees with each other, so I am fairly well informed about what Senator Walsh has under consideration. As distinct from that, there has certainly been discussion about equity and efficiency of the dependent spouse rebate as it is operating. I have participated in such discussions and Senator Walsh has expressed some views on that. Discussion of the dependent spouse rebate and whether it is equitable is certainly not limited to Senator Walsh and me. It is a very widespread discussion. Many women's groups in the community have raised this matter. I believe that it has been a matter for discussion within the Liberal Party. We know that it has been because of the comments that the Leader of the Opposition, Andrew Peacock, has made in public quite recently. Senator Guilfoyle said that that matter has been resolved; but there has been discussion within the Liberal Party, women's groups and the wider community as to whether the particular form of the dependent spouse rebate is the most equitable and efficient use of public revenues. I should like to clarify some of my views which were quoted-from a leaked document I might say-in the Press recently with regard to that. It should be unnecessary to say this but I have to say it because certain non-government senators think they are the only people who are concerned with families, particularly with families with dependent children. The whole thrust of not only the tax reforms we are considering but of Government policies in areas such as education, social security, community services and housing-all our social policies as well as our taxation propositions-has been to alleviate poverty, particularly the poverty that afflicts families. Of course, the poorest of families are the single parent families, a group which I have consistently supported and attempted to assist in all my years in this chamber. I shall start my comments on the dependent spouse rebate by saying that any changes that we would be considering would assist the poorest families in our community, particularly those that have single incomes, be they single income families or single parent families or, indeed, whether they be dual income-but very low income-families. I point out that, in discussing the inefficiency and inequities in the way the dependent spouse rebate works at this stage, I certainly acknowledge that any changes would have to be accompanied by compensatory measures. For example, I drew attention to the fact that although it would be very straightforward to compensate families with children for removing the dependent spouse rebate-one could simply cash out the value of that and add it onto family allowances-that simple means of compensation does not exist in relation to another kind of family which would be badly affected by any abolition of the dependent spouse rebate; that is, the single low-income couple where there are no children. That is a typical circumstance of older people; the wife would have withdrawn from the work force to raise children and then, when the children left home, had no opportunity, because of high unemployment, lack of skills and training, to go back into the work force. We recognise that many couples are in that situation. They are single low-income earners. They could not be compensated by increasing the family allowance, but their circumstances would be greatly reduced should we simply abolish the dependent spouse rebate. I am very conscious that any changes to the way the dependent spouse rebate works would have to take account of couples in that situation. In conclusion, no specific proposals in relation to the dependent spouse rebate or anything else at this stage have been determined by the Government. There has been an open, free and, I hope, intelligent discussion to which I think Opposition senators have made some contribution this afternoon. Senator SHORT(Victoria)(4.59) —Much of what I wished to say has already been covered very well by Senator Chaney, Senator Dame Margaret Guilfoyle and others. In the very limited time available to me I should like, therefore, to confine my remarks to that part of the proposal dealing with the apparent possibility of the Government means testing the spouse rebate. I assume that the Government is flying this kite because it is looking for ways to contain expenditure in the next Budget. Certainly, I would not find fault with the desire to contain government expenditure. On the contrary, I regard it as having the highest priority. The reason that we in Australia now have one of the highest Government taxation and debt burdens in the whole world is the spendthrift approach to government spending which this Government has taken since it came to office. I welcome any attempt by the Government to keep its spending within manageable limits. But the Opposition objects very strenuously indeed to what appears to be a blatant attack on the family which the proposal to means test the spouse rebate would constitute. Senator Ryan —Didn't you listen to anything I said? Senator SHORT —Yes, I did, and I did not learn a great deal. The family, particularly the single income family with dependent children, is already under strong attack in Australia. Only a decade ago, the report of the Henderson Commission of Inquiry into Poverty in Australia, found-this still applies today-that the single income two parent family with dependent children was at greatest risk in our society. So why is the Government now flying kites to suggest that it should adopt a policy which will make more serious the position of those families? With due respect to the Minister for Education (Senator Ryan), I do not believe we have heard a convincing answer to that this afternoon. It would not be unreasonable to speculate that the real reason lies in the apparent view of people like the Minister for Finance, Senator Walsh, and Senator Ryan that everybody somehow or other ought to be in the paid work force and that there is something wrong with parents choosing to remain at home to bring up their children. As Senator Harradine said, that line of thinking totally ignores the enormous contribution which parents who choose to remain at home to bring up their children make not only to the well-being of their own families but to the well-being of our nation. The Opposition opposes what it sees as an attack on the family in this kite flying. We oppose it on other grounds as well. We oppose it for two reasons in particular. It restricts the freedom of individuals to choose and it confuses a welfare payment with the simple recognition that it costs more to support two people than one. Means testing of the spouse rebate restricts a family's freedom of choice because it treats single income families unfairly, compared with two income families. It ignores the fact that it costs a one income family just as much to live as a two income family. The tax system should take account of this. That is why we have the spouse rebate. If it is removed or severely additionally means tested, the Government in effect will be saying that the single income two parent family should be penalised because one member of that family, for whatever reason, has chosen not to be in the paid work force. It is quite wrong to penalise that decision and to limit the family's freedom of choice. The spouse rebate is not a welfare payment. It is simply a recognition of the obvious fact that it costs more to support two people than one. The proposal is also totally inconsistent with the Opposition parties' policy of allowing single income families to split their income for tax purposes. That policy was developed by the coalition parties because of their recognition that single income families are disadvantaged by our existing tax system. To means test the spouse rebate would mean that the tax system would be changed to disadvantage those families still further. At a time when the tax summit is being foisted on us, it seems crazy for the Government even to contemplate tinkering with the system in this way. The summit appears to have enough difficulties as it is. It will be in even more difficulty if a proposal such as that to means test the spouse rebate is introduced in a vacuum and without regard to all those other elements of tax reform which may arise over the next year or so. We all agree that tax reform is very desirable and necessary, but it must be looked at as a package and not in a piecemeal way. A proposal such as that which we now have floated as a kite before us would certainly contribute only in a piecemeal way. The matter raised in the motion brought forward by Senator Chaney today is an urgent matter. It deserves the support of all members of this chamber if they believe in freedom of choice, in a fair go for single income families, in an equitable tax system and in tax reform being introduced in a logical and consistent fashion. For those reasons, I move: That the question be now put. Question resolved in the affirmative. The DEPUTY PRESIDENT —The question now is: That the motion be agreed to. All those of that opinion say aye, against say no. I think the ayes have it. Senator Chaney —On a point of order, Mr Deputy President: We heard noes from the other side and we had a clear demonstration from speakers on the other side- The DEPUTY PRESIDENT —There was only one no, Senator Chaney. Senator Chaney —No, there were two, Mr Deputy President. The DEPUTY PRESIDENT —Even if there were more than one no, there is no challenge from those who called no. Senator Chaney —It is typical of the pathetic approach of members of the Government that they should speak against, but refuse to vote against, the motion. They are not prepared to divide. Original question resolved in the affirmative. Senator COOK(Western Australia)(5.06) —I move: That the Senate take note of the paper. This report is important. I know every senator who stands to speak to a paper says that, but the report of the Australia-China Council indicates that Australia is coming to terms with the fact that our region includes Asia and that we need to develop our relationships in this area so that we are able not only to live in harmony with our neighbours but also to deal culturally and in trading terms with them. In the case of the People's Republic of China, a Labor government has a lot to be proud of in that the former Whitlam Administration was first to recognise the People's Republic. The then Prime Minister, Gough Whitlam, visited that country in 1975. The activities of the Australia-China Council in 1983-84, the subject of this report, have been important in broadening and consolidating Australia's relations with that country. The Council itself has been a catalyst in developing bilateral relations. It has initiated new exchanges between the people of Australia and the people of China. More recently, it has developed means to support projects that will benefit both Australia and China. A range of activities have been initiated in the areas of science and technology, the social sciences, the arts, sports and the media. There has also been the development of Chinese studies in Australia. Of particular importance has been the encouragement of Australian studies in China and the study of China and Chinese languages in Australia. I think that is an important point. Certainly, if language is the bridge between cultures, that development has been a most welcome one. The Council has also continued to support a Chinese language text book for junior secondary students who are learning and beginning to understand the Chinese language. The Council has also taken action to meet a need which has been evident for some time, namely, the need for professionally trained Australian interpreters of the Chinese language. In the science and technology and social science areas, the Council has continued to support, by providing fellowships for a number of Chinese scholars to study in Australia and by sending Australians to study in China, collaborative research with China in new areas. That has been particularly emphasised in the report. In the last couple of years, Australia has had a number of important contacts. The report refers to the visit to Albury-Wodonga of the Chinese acrobatic troupe which worked with Australian gymnasts to learn from skilled masters in China the art of gymnastics as developed by that country. The assault on the north face of Mount Everest was launched from Tibet. Australians participated in that expedition, which has been a much publicised media event. It was made possible by virtue of the association between the two countries developed by the Council. In 1983 Australian and Chinese journalists studied together how best to report the facets of and developments in their society. Most of us would have seen the Entombed Warriors Exhibition, the Chinese exhibition of terracotta warriors that travelled around Australia. Those are some of the positive achievements that have come from the development of ties between our countries. I understand that the Inter-Parliamentary Union of this Parliament just last sitting week made a decision to invite the establishment of an Australian-Chinese bilateral friendship group. I hope that what the Australia-China Council has been able to do at its level will now be able to be mirrored between the Parliament of this country and representatives of the people of the People's Republic of China. I commend the 1983-84 annual report of the Australia-China Council. Senator HARRADINE(Tasmania)(5.10) —I will be very brief in speaking to the 1983-84 annual report of the Australia-China Council because I notice that there are a number of papers about which honourable senators want to speak, including the paper on Telecom Australia and the Special Broadcasting Service. I spoke on the Australia-China Council report last year. I have recently written to the Minister for Foreign Affairs (Mr Hayden) about the matter on which I spoke last year and I intend to take that matter further along the line. We should not have a kowtowing attitude to China. We should approach it in an intelligent fashion. That entails, where necessary, raising matters of genuine concern. The debate on the report of the Australia-China Council is one opportunity to point out some matters of general concern which could be raised by the Council as well as by government. I refer to a recently published book, Broken Earth, which was written by Steven Mosher. It was reviewed by Robert C. Morrison, who wrote that it was a compelling study of life in rural China today, where 80 per cent of the people in the People's Republic actually live. He wrote: Mosher's message is simply this: the image of China's vast peasantry as liberated, well-fed, well-clad, and well-cared for by 'barefoot doctors' is a grotesque lie. The other night there was an interesting speaker at an Amnesty International function, former Senator John Wheeldon, who, I believe, made the same comment. Mosher also details and exposes the compulsory birth control programs in China. Morrison, in his review, stated: In a campaign called 'High Tides' which began in 1980 (and which continues today), pregnant peasant women, many in their last stages, are forced to undergo abortions. All over rural China, party leaders called cadres, ordered mothers to report for 'family planning sessions'. Mosher details substantially the forced 'family planning' activated in China. It is a matter of serious concern, it is a matter of the fundamental rights of the people concerned and it is a matter which the Australia-China Council should refer to as a matter which is disconcerting to the Australian side of the Australia-China Council. Indeed, the Australian Government could exercise some influence in this area. The Executive Secretary of the United Nations Fund for Population Activities visited Canberra in January seeking an increase of $1.125m in the Australian contribution. The Executive Secretary of UNFPA was the subject of successful pressure last year by the United States Government, which sought an assurance that it would not fund abortion or coercive population policies such as exist in China today. The Australian Development Assistance Bureau-an aid organisation-on 2 October 1984 in a Senate Estimates committee hearing stated that it was unaware of the United States move and it had not sought similar assurances. A large amount of the UNFPA fund goes to China. The UNFPA has now given an assurance on that matter. But the International Planned Parenthood Federation, which also receives Australian funds, has not given a similar assurance. I take this opportunity of suggesting to the Government that it ought to obtain such an assurance from IPPF in order to preserve the fundamental human rights of persons in China as well as anywhere else, particularly the less developed countries. Senator COONEY(Victoria)(5.15) —I wish to make some remarks apropos of what Senator Harradine has said. I will not be long because I know that honourable senators want to talk about the Sharpeville incident. Senator Harradine has said that he does not agree with certain aspects of life in China. I certainly agree with what he says. I add that I disagree with the large scale executions of criminals, which I find abhorrent given my views on capital punishment. But it would not be a positive act for people to look simply at those aspects of China with which we do not agree. The thing to do especially in the field of foreign policy, particularly with China, is to look at the positive aspects we can use to engender understanding of a nation with which we once experience hostility. Fortunately that hostility has faded away; it has now disappeared. As my colleague Senator Cook said, a lot of that is due to the efforts of Mr Whitlam. In foreign policy we should never proceed on the basis of hate; we should certainly proceed on the basis of caution and on the basis of aspiring towards an understanding so that we appear to the people with whom we have relationships as reasonable people and they appear to us as reasonable people. That is one of the objectives that the Australia-China Council has and is one of its objectives that has been successful. It is to be noted and commended that the relationship between Australia and China has improved. Hopefully, it will improve to the extent of our relationships with countries such as Italy-with which we fought in the last war-Japan and West Germany. Even taking into account what Senator Harradine has said, it nevertheless remains that this is a most worthy organisation and ought to be commended. Question resolved in the affirmative. Senator CHANEY(Western Australia-Leader of the Opposition)(5.18) —I move: That the Senate take note of the paper. I do not wish to speak at any great length on the statement which is before us. I think that the whole of the Senate would be appalled at what occurred recently in South Africa and would wish to endorse the Government's statement and express very great regret at what has occurred. We have been going through a period in which there have been some signs of change in that country. Some of those changes have been in the direction which would have been sought by most Australians, a direction towards some reduction in the rigours of apartheid. However, the fundamental checks and balances of that system-perhaps I should not use that expression because it suggests something positive-or the fundamental structures of apartheid remain in place and that is a matter which has received unanimous criticism in this Parliament. In moving that the Senate take note of the paper, I confirm the Opposition's concern about what has occurred and in this case relate the Opposition to the statement which has been made by the Government. I will not seek leave to continue my remarks later because I understand that Senator Sibraa wishes to make some comments. Senator SIBRAA(New South Wales)(5.20) —I welcome the remarks made by Senator Chaney. Earlier this year the Minister for Foreign Affairs (Mr Hayden) appointed me to lead the Australian delegation to the Southern African Development Co-ordination Conference, SADCC, which was held in Swaziland. In order to travel there it was necessary for me to travel through South Africa. At my request the Australian Embassy in Pretoria arranged a program of meetings and visits during the one and a half days that I was there. These included meetings with a number of organisations. I was pleased to find that a number of senators who have taken an interest in human rights, especially Senator Missen, were well known to those organisations. I was driven to Soweto and to Sharpeville and saw for myself the misery and degradation that exist in these townships. Soweto is not really a township but a city-one of the largest black cities in Africa-yet it does not appear on a map of South Africa. I experienced at first hand the suspicion and tension that existed when the Australian Embassy officials and I drove through the streets. I saw how the children stopped playing and averted their heads when they saw Europeans passing by. One could see the distrust. Within this environment I find it, as the Foreign Minister finds it, almost beyond belief that the South African police should have killed at least 17 people-I think that 19 is the latest count-on the twenty-fifth anniversary of the infamous Sharpeville massacre. What a way to celebrate an anniversary, but at least they are being consistent! The recent incident is yet another example of the current unrest that is taking place in South Africa. At the Crossroads settlement near Capetown 18 people were killed and more than 200 injured very recently. Yet the South African Government continues to talk about constitutional changes aimed at limited power sharing, as if it is making progress towards real democracy in South Africa. At the same time 23 million blacks-that is 77 per cent of the population-are deliberately excluded from the political life of their country. The Australian Government correctly rejects as hollow pretence any claims that democratic progress has been made in South Africa. Let me give some telling statistics about South Africa. South Africa has the highest per capita prison population in the Western world. Estimates are that less than 3 per cent of the inmates are white. Some 95 per cent of the Western world's executions are carried out in South Africa. For example, in 1980, 130 hangings took place and only one of the victims was white. More people were detained by police last year than in a number of previous years. The figures were recently on the front page of the Rand Daily Mail in Johannesburg-a newspaper that has been forced to close because of government pressure on advertisers. The Australian Government will continue to reject apartheid. South Africa is the only country in the world which explicitly enshrines racism in its constitutional provisions and its structures of government. There have been a number of excellent articles recently in the Sydney Morning Herald and the Age about the problems in South Africa which I believe all senators should read. The economy of South Africa is reeling, the black trade unions are flexing their muscles, the cost of the continuing war in South West Africa-about $1m a day-is increasing and the policy of destabilising the surrounding countries continues despite the stated policy of the Government. South Africa is also experiencing the disastrous drought affecting the region and recent reports suggest that South Africa has been purchasing surplus maize from Zimbabwe-an ironic twist of fate. I mention these things because I believe that the time is ripe for Western countries to pressure South Africa, to show their outrage at the recent killings and to call upon the South African Government to act immediately to initiate a process of peaceful transition to democratic government for all races in South Africa. There are a number of issues which could be debated and which the Senate should debate. Unfortunately we do not have time this afternoon. For example, I mention sporting links with South Africa and the proposal for a world rugby cup to be held in Australia and New Zealand. I was pleased to see that both the Prime Minister (Mr Hawke) and the Foreign Minister stated unequivocally that no South African team would receive visas to come to Australia to play. Another example is South African Airlines, which has one of the most lucrative airline routes in the world into Australia. This Government should look seriously at giving SAA one year's notice to get off the route. I am convinced that if Qantas were to fly people who wish to travel to South Africa into Mauritius and Harare, South African Airlines would be forced to pick them up. I look forward to having a full debate in the Senate on the tragedy that is occurring at present in southern Africa because I believe that what is likely to occur in South Africa in the future will make events in other African countries look like a Sunday school picnic. Senator MASON(New South Wales)(5.25) —I rise to support the Government paper and on behalf of the Australian Democrats to express our dismay and anger at the recent events in South Africa. These have the most unhappy implications for the future and very clearly point out that the policy of apartheid does not work. Nor is it any longer possible in the world, if it ever was, for a minority indefinitely to keep a majority subservient. It shows us that attempts to do so inevitably lead to suppression in a physical sense, to a growing confrontation and ultimately, as we now see, to atrocity. Indeed, the deaths of 19 people in Uitenhage last week must be only an episode, unfortunately, in what looks like a continuing period of crisis. Just as Sharpeville preceded Uitenhage, so another such incident must ensue if the policies of the South African Government do not change, and as far as we can see from the statements of Mr Botha and others there is no indication that it will change. It worries me that apologists for the South African Government, including at times apologists in this Parliament, talk about unrest and violence among the black majority as if these were matters which justified continued repressive policies and that there was some reason for this, instead of perceiving that the real truth is that they are the consequence of repressive policies. While those repressive policies go on this can be only an increasing problem. It is worth noting that Uitenhage was only one part of a protest which goes back to some very important basic matters-a rent and education protest, which has now become a general challenge to the Government and which has, since it began, involved the deaths of more than 240 black people. Uitenhage is really just the tip of the iceberg. Beyond this, there have been very disquieting aspects of South African society for some considerable time. There have been repeated incidents in which people have died while in police custody such as the notorious one involving Steve Biko, which can indicate only continued disquiet and a breakdown of the legal processes in South Africa. South Africa can no longer be regarded as a society in which there is equality of its citizens before the law. There never has been that, but at least one might have hoped there was equality of citizens according to the law as South Africans interpret it; that is, the apartheid-type law. However, I think that even that has been lost now and that the police in South Africa have been guilty of the murder of people in prisons. They have continued to do that and it has become a policy which is part of the system of repression of black people and it can lead only to tragic consequences in the future. As Senator Sibraa mentioned, yesterday the Sydney Morning Herald had some interesting things to say. Yesterday's editorial is worth quoting briefly. It points out that there will be more than lives and property at risk. It then says: The already dangerous erosion of moderate black support for peaceful reform will accelerate. And the growing violence will swell the numbers of white hardliners who will, no doubt, interpret what is happening as the consequence of Mr Botha's tentative reforms. That is perhaps one of the most tragic consequences of the whole thing. Whatever leeway Mr Botha has to ease the lot of the blacks will now perforce be a great deal narrower. Commenting on the events of last Thursday, Mr Botha said: We are going to keep order in South Africa. And nobody in the world is going to stop me . . . That intention will cause appalling problems in the future. Some action is necessary from our Government. It is not sufficient that we should tolerate this situation. We should not be friendly with a country which does this; we should not have contacts with it. It is a country which has a heritage from the Western democratic system-- Senator Peter Rae —Would you abolish contacts with Russia and China? Senator MASON —These people are different. I agree that Russia is a dangerous, unstable and repressive society; it is that. But we should have expected more from people of European and Western antecedents than the South Africans are capable of mustering. They have a moral obligation and a past which should give them the ability to deal with this situation in a better and fairer way than they have. The fact that they have not done so places a greater moral burden on them. Senator TOWNLEY(Tasmania)(5.29) —I did not realise that so many people would want to speak on this subject. There are so many aspects of this matter that I feel it deserves much more time than the few minutes that we have available today. This is something we must look at in total perspective. I do not believe that what Senator Sibraa said is correct; that the police in South Africa are consistent. That is what I think he said. In other words, he was trying to imply that this was almost done on purpose by the South African police. Senator Jones —It has been happening for 25 years. Senator TOWNLEY —I am not making apologies for the fact that it happened; I am just trying to keep this debate in some perspective, because if we force South Africa into a situation where it is entirely by itself we will not be helping the blacks of that country at all. I have been advised that if we help ruin the economy of South Africa the people who will suffer first will be the black people. As I see it, the only way things can be improved in South Africa is gradually and sensibly, and certainly by countries of the world admonishing occurrences such as we have just seen. When attempts are made in a genuine way to improve the situation, it is about time that some of the leaders of the world made some comments. They are only too pleased to criticise something that is obviously deserving of criticism, but how often do we hear them trying in a genuine way to assist the process of change that we all know has to happen in South Africa? I feel that this matter is one on which we should have a thorough debate. It is time that people showed some encouragement to the country to change rather than force it into a position whereby too rapid change will result in a very dangerous situation. Senator COONEY(Victoria)(5.32) —I express my sentiments along the same lines as Senator Chaney, Senator Sibraa and Senator Mason. I listened to what Senator Townley said, and of course outrageous interferences with rights in other parts of the world ought to be condemned. Earlier I condemned the executions in China, even though the people executed were criminals. The fact of the matter is that it is outrageous that 19 people were slaughtered-that is not too emotive a word in this situation-on the basis that they were of a different colour. Senator Townley —Did you know that the police who actually shot them were in fact white? Senator COONEY — Senator Townley has misunderstood what I said. They were shot because they were black; I did not say whether the police were white or black. I had not turned my mind to that. If they were shot by blacks, in my view that is more outrageous. The fact of the matter remains that they were shot because they were black. I do not say that that was the specific thought in the minds of people who did it, but I do say that that sort of result has come about because there is division in the nation. That just cannot be tolerated. I thought Senator Chaney put it well. He made very few remarks, but did so quite properly because little can be said that has not already been stated about the South African situation. Nevertheless, nothing seems to come from the statements we hear; so I say to the people who suggest that we take it slowly that it has been taken slowly over the years but we have got nowhere. Other people might want to speak: I simply want to rebut the suggestion that we should not feel outrage at what has happened in South Africa. Senator PETER BAUME(New South Wales)(5.34) —I want to pick up a point made by Senator Mason. I do not believe it is proper or appropriate to try to attribute degrees of morality to nations depending upon their cultural heritage. I agree with Senator Cooney that the denial of civil liberties and the murder of people, wherever it occurs around the world, is of equal gravity. Senator Mason should read his own speech in Hansard tomorrow. He will find that his moral outrage fell unduly upon one country. Like him, I am a member of Amnesty International; like him, I feel that what happened in South Africa was outrageous. I have refused ever to accept an invitation to the South African Embassy; I will not visit the country or have anything to do with it. Many members of my congregation have fled from South Africa. What has happened there is outrageous, but it is no more outrageous than what is going on in other countries. We have just had the report of the Australia-China Council, and I agree with Senator Cooney that we need to say a lot more about what is going on in China, about arbitrary executions and the denial of human rights. We have to talk about the one-party states in Africa and about the dictatorships in South America. The Amnesty International group tries to play it fair right around the world. Sure, what is going on in South Africa is outrageous, but it is only one of the outrageous things occurring in many countries around the world. I just wish some of these people who are properly outraged about South Africa would be equally outraged about other countries where equally bad things occur. Senator PETER RAE(Tasmania)(5.36) —I wish to support what has been said by Senator Baume and to add very briefly that I believe that what is happening in Iran, Afghanistan and so many parts of the world is worthy of a debate in this place and is worthy of condemnation. I think also that if steps are taken in any of those countries to improve the situation, those steps are worthy of encouragement. I would like to hear occasionally somebody say something about the encouraging steps that are being taken in South Africa as well as the things that are discouraging. There has been a lot of change and we should be glad that that has taken place. So while we are discussing these matters, let us try to keep them in perspective; let us try to keep a world perspective and keep in perspective in relation to South Africa what changes there have been for the good as well as what examples there have been of the extremely bad situation which exists. The DEPUTY PRESIDENT —Order! The time allotted under sessional order in relation to Government papers has expired. Senator REID(Australian Capital Territory) -by leave-I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator LAJOVIC(New South Wales) —by leave-I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator JONES(Queensland) —I seek leave to move that the Senate take note of paper No. 3 so that it can be brought on for debate on Thursday. The DEPUTY PRESIDENT —Paper No. 3 will automatically appear on the Notice Paper because the debate was interrupted. Anything can be done with the leave of the Senate. I draw the Senate's attention again to the fact that, if no motion is moved relative to any of these papers, any senator may move on a General Business Thursday to bring up any of these papers about which no motion has been moved. It is perfectly proper to move that motion if one wishes it to be on the Notice Paper, but it is not necessary to do so to be able to debate it. Senator CHANEY(Western Australia-Leader of the Opposition) —by leave-The deficiency which bothers honourable senators in the procedures we currently have is that there is no list on Thursday or on General Business day to show the papers still available for comment. Honourable senators would be more inclined to follow the procedure which you have drawn to their attention three or four times, and which I agree reflects the sessional order, if the practice were adopted of re-issuing the list of papers on the day. We are all trying to do 15 things at once. We are not as efficient as we would like to be and it is terribly easy for something to slip out of sight. If we had that practice of re-issuing on that day a list of all the papers which have not been dealt with, it would encourage people to follow the procedures of the Senate. It would not mean a lot of work because we would use the old list. The DEPUTY PRESIDENT —Such a paper is available to the Chair. I will raise with the President whether it would be possible to circulate that to all senators. That would solve the problem. Otherwise we will have a succession of motions every time papers are not dealt with. It would probably solve the difficulty. The DEPUTY PRESIDENT —I inform the Senate that the President has received letters from the Leader of the Government in the Senate and the Leader of the Opposition in the Senate nominating senators to be members of Senate Estimates committees as follows: ESTIMATES COMMITTEE A Senators Cook, Cooney, Hill, Jessop, Robert Ray and Short ESTIMATES COMMITTEE B Senators Crowley, Elstob, Giles, Messner, Sheil and Walters ESTIMATES COMMITTEE C Senators Boswell, Brownhill, Childs, Maguire, Parer and Primmer ESTIMATES COMMITTEE D Senators Aulich, Baume, Colston, Puplick, Watson and Zakharov ESTIMATES COMMITTEE E Senators Black, Sir John Carrick, MacGibbon, Reynolds, Sibraa and Teague ESTIMATES COMMITTEE F Senators Georges, Hearn, Reid, Richardson, Townley and Vanstone Motion (by Senator Gietzelt)-by leave-proposed: That the senators indicated, having been duly nominated in accordance with the provisions of standing order 36AB, be appointed members of the Senate Estimates committees. Senator PETER RAE(Tasmania)(5.43) —I would not want the motion moved by the Minister for Veterans' Affairs (Senator Gietzelt) to pass without it being noted that consideration has been given to improvements in the operation of the Senate Estimates committees by a bi-partisan committee of the Senate and by individual senators including some Opposition senators. They include the constitution of the committees, the grouping of the committees and other matters. Whilst the motion moved by the Minister is not opposed at this stage, I would not want it to be taken that it is writ in stone that the current procedure should be followed. For the coming Estimates the composition of Estimates committees A to F will be as it has been in the past. I hope some discussions will take place at an early stage in relation to possible changes to make more effective and efficient the utilisation of time of senators, the staff of the Senate and the staff of the Public Service. A statement will be made by the Leader of the Opposition (Senator Chaney) in the near future in relation to that. I foreshadow a number of matters which he will be referring to in relation to the committee system, including some proposals which we hope can be considered by the Senate, the Standing Orders Committee and others in the party rooms for further development of the Estimates committee proceedings. I take the opportunity to mention that at the time of agreeing to the motion the Minister has moved. Question resolved in the affirmative. Senator McINTOSH(Western Australia)(5.45) —I move: That the following matters be referred to the Standing Committee on Foreign Affairs and Defence: (1) The Australian Army's rapid deployment capability. (2) The United Nations Educational, Scientific and Cultural Organisation. I take this opportunity to inform the Senate that the Standing Committee on Foreign Affairs and Defence has resolved to resume its inquiry into Papua New Guinea, first referred to it on 3 May 1984. The Committee has received a number of submissions on Papua New Guinea and will decide its future program on that subject in the light of the issues raised in those submissions. In the meantime, the Committee will move immediately to the consideration of the two matters which have just been referred to it. Question resolved in the affirmative. Debate resumed from 22 March, on motion by Senator Ryan: That the Bill be now read a second time. Senator CHANEY(Western Australia-Leader of the Opposition)(5.47) —The Senate has before it the Bounty (Commercial Motor Vehicles) Amendment Bill 1985. The Bill extends an existing bounty from 1 January 1985 to 30 June 1985, and makes provision for a further extension to 31 December 1985. The reason for the possible need for further extension is the failure of the Government yet to respond to the Industries Assistance Commission report which has been in its hands for some time, but on which it has yet to announce a decision; a report which relates to the assistance, long term or otherwise, that ought to be provided to this industry. I make it clear from the outset that the Opposition does not oppose this Bill. I make a number of comments about the industry affected by it and the reasons for the Bill being necessary. Before doing that, I acknowledge the very useful debate on the Bill in the House of Representatives. I think we will see a series of quite lengthy debates-provided the Government does not gag them, of course-on industry policy and I acknowledge the contributions to the issues arising from this Bill which were made in the other place only last week. We are dealing with an industry which has a complex assistance package. I am speaking rather slowly because I had hoped the Minister for Industry, Technology and Commerce (Senator Button) might be here to consider the Bill-no doubt he will turn up eventually. Senator Peter Rae —He is in the wings watching and waiting. Senator CHANEY —I am glad he is there. He is probably smoking. I am quite happy for him to finish his cigarette and I will carry on in his absence. There are tariffs on imported completely built-up vehicles and some components; there is by-law entry for original equipment components in general purpose vehicles and prime movers; and there is bounty assistance for locally sourced original equipment components for use in general purpose vehicles and prime movers. This Bill affects only the bounty part of that assistance, which expired on 31 December. The bounty is paid at the rate of 20 per cent of the inter-store cost to the assembler of certain components. Bounty assistance is not available if those components are produced in-house by the assembler or of the local content is less than 65 per cent. On any description, that is a fairly complex set of arrangements. Clearly, that complexity must affect the business decisions made by people in this industry. There must be a tendency for them to make decisions which relate to the assistance package rather than to the most efficient way of going about any particular task. The very complexity of the system-for which I do not blame in any way the present Minister or the present Government-stands as a problem to be dealt with after due consideration. We are dealing with an industry which has seen a pretty severe downturn. As a result of that downturn in the industry's performance a reference was forwarded to the Industries Assistance Commission in May 1983. There seemed to be a degree of urgency in the matter, because the Government requested an interim report within two months. It did, in fact, receive an interim report. The report recommended that temporary assistance was not necessary. The Government accepted the IAC recommendation and amended the reporting date for the full report by bringing it forward from May 1984 to 29 February 1984. I suppose that this, in itself, applied a degree of urgency on behalf of the Government and on behalf of the industry. I do not think there is any doubt that the industry was in a state of some decline. There are a range of reasons for that. Notwithstanding the assistance which has been given in the various ways I have described since 1978 when the existing assistance measures were introduced, the level of local assembly has, in fact, declined quite markedly. There has been a slight growth in the overall market for heavy commercial vehicles since 1978, but imports have rapidly increased their share, particularly at the lighter end of the market, going from 45 per cent to 68 per cent in 1983. There has been a decline in registrations and I suppose that has had something to do with the economic conditions generally, but there has been a position of real difficulty for the industry. Over five years jobs in the heavy vehicle assembly industry have been reduced to less than half of what they were. So we had a situation of some difficulty-the facts are fairly stark-and we had the Government calling for a quick response from the Industries Assistance Commission. It is a little puzzling, therefore, to find that, notwithstanding that request for an earlier report and bringing it forward to February 1984, there has been a very long delay in addressing what package ought to be provided for this industry. There is a very great readiness in government to identify problems. One finds, of course, that they are rather more difficult to tackle in practice than they are to define. We have certainly had a definition of a problem here and, as yet, whilst there may have been an attempt at a solution, certainly no solution has been produced. The Opposition and the industry expressed concern late last year over the delay in making an announcement on the future arrangements for the industry. Eventually the Minister announced that the bounty would be extended to 30 June 1985. That announcement was made on 7 December, 24 days before the bounty was due to expire. In light of the Minister's views about the need for predictability for industry-views with which I concur-I think he would agree that that is not the best way to be dealing with the industry and the best basis for planning that can be given to it by government. We have a position, therefore, where we are considering this legislation after the Government has now had the final IAC report for over 12 months. Early in February a decision was made to release the report, so it was released when it was nearly a year old. One can imagine that that has been a source of some embarrassment for the Department and perhaps also some embarrassment for the Minister. The Opposition expresses the hope that there will be no further unforeseen delays in dealing with this matter and that the bounty period will not need to be extended until the end of this year because no decision has been taken, but we accept that given the history of the matter it may well need to be extended and we, therefore, will not oppose that or any other part of this Bill. I think the history of this matter sits oddly with some of the Ministers who have expressed concerns about how industry should be approached. I think also that the structure of this particular industry does not sit particularly well with some of the criteria the Minister has laid down generally for industry, and the car industry in particular if one wants to take a comparable area. It would appear from the growth of imports and from the declining share of the market that the local industry is not competitive with the international industry. There are, of course, a very large number of participants in this industry. I have seen nothing which would suggest that the Australian industry is outward looking and seeking to expand its horizons to overseas markets. I would have thought, again given the Minister's approach to some of the other industry matters we have been dealing with, that he would see these as real difficulties which need to be addressed in determining what the long term protection situation for the industry should be. We are dealing with an industry which continues to be important, directly and indirectly, in the Australian economy. Employment, indirectly and directly, is estimated to be about 13,000 people. The turnover is about $540m. The Bureau of Transport Economics estimates that road transport accounts for 80 per cent of the total freight carried throughout Australia. The IAC estimates that the value of freight movement activity accounts for about 3.5 per cent of our gross domestic product. I think these figures illustrate the important role that the industry plays in the economy. I hope that the Government will take long term decisions which will enable the industry to become more efficient. We have some very stark international comparisons. Sweden has a domestic industry that supports two internationally competitive manufacturers, Saab-Scania Australia Pty Ltd and Volvo Australia Pty Ltd. Those companies have substantial export markets, including Australia. I suppose they demonstrate that a small market need not be an inhibitor to growth, nor to export potential. Whilst I would not suggest that the position of Sweden is parallel in many respects to our own-it is much closer to the very large European market-I am sure that on the Minister's own statement he would be concerned that the present fragmented Australian industry is in a condition which does need some change. It will be interesting, I am sure, to the industry and I think to Australia, if in the debate today the Minister can give us some indication of his thinking in these matters. Indeed, if there could be perhaps-- Senator Button —I am sorry. I did not catch that. Senator CHANEY —We would like an indication of how the Minister sees the future of the industry, the present shape of it and what his objectives are in the longer term decisions which undoubtedly he will be taking over the coming months. I cannot see any particular need for that to be a matter of enormous secrecy and privacy, and some public debate on the issuses which face this particular industry may be of assistance to the Minister and to the industry itself. I would have thought, in looking at the ultimate decisions which will have to be made, that those decisions should acknowledge that we have, at the moment, something less than the ideal of a truly internationally competitive potentially exporting industry. The potential may not be very great in the immediate future, but one would hope that the directions that are going to be set by the Minister would be in the direction of encouraging that possibility. The Opposition points out to the Minister that the Australian industry in this area, and indeed in other areas, still carries many burdens which help to keep it uncompetitive. Many of these have been acknowledged by the Minister, but there has not actually been much change. In the labour market, for example, where work practices often relate to history rather than present productivity, there seems to be a difficulty in achieving change. I do not know whether the Minister is able to tell us what, if anything, the Government is seeking to do about that. Senator Peter Rae —He hasn't done much about penalty rates, has he? Senator CHANEY —Senator Rae interjected on a point that I had intended to mention-another problem that has been acknowledged by the Minister; that is, the problem of penalty rates and so on and the on-costs which afflict most sections of Australian industry. Again, although they have been acknowledged by the Minister, there is not much sign that they are, in fact, being tackled. We remain in a situation where substantial sections of industry are brought to a halt by strikes and there have been some very significant examples of that affecting areas of industry and commerce in Australia over the last couple of months. It remains true that the cost of many local inputs is inflated by other elements of inefficiency within the economy. I noted that Senator Button's ministerial colleague the Minister for Communications (Mr Duffy) had some very caustic things to say about the Australian Postal Commission and its contribution to efficiency in the Australian community in a speech just a couple of weeks ago. The cost of government services and government instrumentalities is high and has expanded much more quickly than the inflation rate for other areas of the economy. I simply wish to say that in any future that this industry might have it will be important that the Government is seen to be tackling some of these problems which are acknowledged by the Minister but where we have seen a lack of any positive action over the two years of this Government. I hope that the Minister is aiming at decisions which will, in fact, encourage a more efficient industry in Australia. I ask the Minister to use the opportunity of this debate to give us some indication of the ways in which he thinks that can be encouraged. It is not enough, each time these matters are raised, for the Minister to chronicle the fact that there are many issues to ask would the Opposition kindly stop concentrating just on wages policy. On this occasion I invite the Minister, after two years in office-he has had time to consider these matters very fully, to discuss them with his colleagues and to urge the Government to tackle some of these problems-at least to give us some indication of what signs of progress he sees and where he thinks there can be other areas of progress in the not too distant future. Another area that I would like the Minister to address is the extent to which he and his Department have engaged in dialogue with this industry to get it thinking, as well as to get its thinking for the benefit of the Government and to get its views on the possibilities that face it for moving towards more efficient and more competitive production. I raise that point because I think the Minister has been successful in having a very useful dialogue with the car manufacturers in Australia which I believe they have appreciated and which undoubtedly has helped the Minister in his shaping of the car industry policy. I listened with interest to the comments the Minister made in Question Time today when he reminded the Senate yet again that the success of the car industry policy probably will involve a reduction in employment in that area. The policy involves a reduction in the number of car manufacturers in Australia. I confirm what the Minister has, I think, told the Senate on occasions-a point that has been made by many commentators-which is that there appears to be quite a high degree of acceptance in this important industry of the fact that there are to be quite substantial changes over the period of the car plan. The commercial motor vehicles industry is perhaps not a critical industry. However, it is an important industry. It has direct links with the car industry. It is the large end of the market. I would be interested to know the extent to which the Minister has, through his Department or otherwise, been able to engage in the same sort of constructive dialogue with the many manufacturers and assemblers which are members of this industry. This Bill is just an interim measure and, as I say, is not being opposed by the Opposition. I say to the Minister that we would welcome it if he would use debates such as these to deal with some of the common problems which afflict all areas of the manufacturing industry and to describe some of the problem areas where changes are being made, which, as I say, he has been quick to identify during his first couple of years in his portfolio. The concern of the Opposition is that, with some exceptions, the record has been one of identifying the problems rather than necessarily being able to remove the very substantial barriers which exist to change in the many areas where change is required. I hope that Senator Button will do something to inform us this afternoon of the extent to which some of the factors which make this industry uncompetitive are being tackled by the Government and the extent to which the Government is working with the industry to encourage thinking about ways in which the industry can be rationalised to Australia's and to the industry's advantage. Senator SHORT(Victoria)(6.03) —I join the Leader of the Opposition, Senator Chaney, in this debate on the Bounty (Commercial Motor Vehicles) Amendment Bill 1985 to make just a few comments. The proposal before the Senate is for a holding operation to extend the existing bounty to the end of June with the possibility of a further extension to the end of December this year. I guess that the appropriate time for a full debate on the industry and the subject matter generally would be when the Government has made its decision on the final report, rather than at the moment. As Senator Chaney did, I welcome the opportunity I will have at that time to debate the very real issues facing industry in Australia generally. There is a much greater recognition now on both sides of the Parliament, throughout the community generally and, gratifyingly, throughout industry itself, that we have some real problems in Australia in terms of the development of industry policies to create a vibrant and viable manufacturing sector which we all want and which collectively we will have to do a lot more than we have done in the past to achieve. I would like to register a few points today on the subject. Senator Chaney has outlined the background to the Bill, which I will not go over. I reiterate his point, though, which I think is important, that the Government has now had the final report of the Industries Assistance Commission on heavy commercial motor vehicles, parts and accessories for more than 12 months. It has not yet announced a decision on the report. That is the reason we are debating the interim or holding measure now. It is a matter of regret that it has taken so long for the Government to reach a decision. If the Government really wants to encourage business confidence in Australia it will have to do a better job than it has done in terms of getting out decisions for industry more quickly. Unless industry has a clear idea of the environment which the Government will set for it and, therefore, the environment in which it is to operate over a lengthy period ahead, it is disruptive of business confidence and that flows through to all sorts of other things, such as business investment, not only in this industry but also in other industries because it will be seen as a reflection of the difficulty the Government is having in taking decisions in various areas affecting industry. So business confidence is a very relevant aspect in terms of the timing of government decisions on these types of matters. As I said, it is perhaps a typical reflection of the Government's inability-I understand the problem, I think-to come to grips with the very many problems facing this industry and industry generally. So I hope the decision will be forthcoming shortly. The longer the delay, the more uncertainty will be generated. Although this Bill is only a holding measure, it deals with a very important industry because of its relevance to the road transport industry in Australia. Australia is very heavily reliant on the road transport industry. We have a huge land mass. We have huge distances to traverse in the carriage of goods, materials and freight. An efficient and cost effective source of heavy commercial vehicles is of great importance to our whole cost structure because freight costs are an important element of our overall cost structure, more so than in most other countries. In addition, the transport industry is an important contributor to our gross domestic product. Some estimates of its contribution to our GDP, when everything is added, put it at what seems to me to be the staggeringly high figure of 25 per cent. It has been estimated that 25 per cent of gross domestic product is involved in some shape or form in the transport industry. Whether that figure is right or not, it is certainly a fact that the transport industry is a very important contributor to our GDP. Given the importance of an efficient heavy commercial vehicle industry to Australia, of all countries, it is a sad reflection on our industrial expertise and competitiveness that we do not have such an industry in Australia. As I understand it, since the Rockwell company moved its manufacturing base from Australia in the last couple of years, there is now not one heavy vehicle manufacturer in Australia. We have a number of importers and assemblers which do nothing much more than put together components, either imported or local, almost as in a Meccano set. That is not only a sad reflection on our industrial expertise and competitiveness but also, perhaps, an apt example of what is wrong, to an important degree, with Australian manufacturing industry today. It is, as I am sure everyone in this chamber believes, a serious situation. I cannot believe that anyone in this chamber would not agree that a healthy, efficient manufacturing sector in this country is of vital importance to our future. We ought to be able to manufacture heavy commercial vehicles in Australia at a cost and price competitive with overseas manufacturers. Although we are a small market, we are the largest per capita user of heavy commercial vehicles in the world. Vehicles made here have a natural freight advantage compared with imports. The freight costs associated with the importation of heavy commercial vehicles are very heavy, so we have a natural advantage. The industry does not rely on a volume throughput or economies of scale. Virtually all the heavy commercial vehicles are custom built to meet user requirements, and there again the Australian manufacturer ought to have a natural advantage because he is on the doorstep of the user. With the degree of custom built characteristics of these vehicles, that ought to be a very significant advantage. In this respect, the industry differs completely from the passenger motor vehicle industry. I say to the Minister for Industry, Technology and Commerce, Senator Button, that I assume that the Government's passenger motor vehicle plan will not have any relevance to the final decision that the Government takes on this industry. I would be interested in any comments he may have on that. It seems to me that the two industries are very different. When the final decision is made, I hope the Government will act on what seem to be some serious defects in the present arrangements confronting the industry. Although I have read the report and can see the history of how it has happened, it surprises me and I think it is an unsatisfactory situation that the bounty applies only to some components. It applies to only a very limited number of components. Even within these, in-house components, as I understand it, are not bountiable. That seems to be a questionable situation in logic. It appears that the industry is saddled with too many assemblers. There is a small domestic market but I wonder what the industry has done, if anything-I would be interested in any information that the Minister may have-to attempt to export. I would not have thought it was beyond the wit of an efficient industry in Australia to be able to export some of these vehicles given our experience particularly in their usage and manufacture. The industry obviously suffers from heavy labour and other costs. It appears that some of the main problems facing the industry are those which face manufacturing industry as a whole. There are some specific questions I wish to put to the Minister if he can deal with them in terms of this report. It is not clear to me who are the main beneficiaries of the protection being accorded. I wonder whether the assistance that has been granted over a lengthy period has in any way improved the industry's viability. One would have to question that. Given that there is not a single manufacturer as such in Australia, that the component manufacturers are very diverse and the manufacture of components for the heavy commercial vehicle industry is only a small part of their production, I wonder whether any cost-benefit analysis or similar analysis has been done by the Government in respect of the extension of the bounty. Although it may be a little premature for the Minister to comment on this, I wonder what he thinks about the long term prospect for this industry. They are a few specific questions about the industry. I think they reflect overall the need for policies to improve industry generally. In recent days we have heard from the Minister, in the form of answers to questions and otherwise, about the range of problems facing industry in Australia. I agree with him that there is a wide range of problems. It is not just a matter of wage rates, protection or any other individual thing, although my personal view is that wages and wage related costs is the major factor. But there is obviously a range of problems. There are wage costs, the whole question of technology and its application to an industry such as this and, above all, the question of productivity in the industry and in Australian industry generally. I think that we know most of the problems confronting an industry such as this, which are typical of those in many other Australian industries. We know the problems and we have identified many of them. We may not have got their weighting quite right but overall I think that we know most of the problems. The question that the Government really has to face in the first instance is how we actually come to grips with solving those problems in a practical way. I will leave my comments there. I have posed some questions. I do not expect that the Minister will necessarily be able to answer them all at the moment but they are the sorts of questions that we ought to be asking ourselves and putting to industry. I hope that this type of vehicle for debate that we have here today will reappear on other occasions because a wider, fuller and rational debate on-and exposure of-some of the problems and the opportunities facing Australian industry is needed. It is one of the critical issues that we as Australians have to face. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(6.16) —I appreciate the comments made by honourable senators and particularly the way in which Senator Short put his remarks at the beginning. He showed a recognition of the size of the problems which the manufacturing sector generally faces. I noted with interest that Senator Chaney drew a comparison, by way almost of a rhetorical question, between why Swedish industry had two major manufacturers of heavy commercial vehicles which exported and why Australia did not. I do not seek to make a glib political point. Senator Chaney —Nor was I. Senator BUTTON —I did not say that you were. It is an enormous problem. I am not seeking to make a good political point but I do have to make the point that I suspect that one of the reasons is that Sweden in the relevant period had 30 years of social democratic government while Australia in the same period had 30 years of Liberal-National Party government. I qualify that by saying that it could have been a bad Labor government or Liberal-National Party government here compared with a Swedish social democratic government which, on a wide range of issues fundamental to the success of a manufacturing industry, developed consensual mechanisms which were tremendously important to the success of the industry-consensual mechanisms basically concerning wages and conditions in manufacturing industry but also a whole range of supplementary issues such as the importance of productivity, design, quality and so on in workmanship. These sorts of things were developed on a highly consensual basis in Sweden over 30 years. In Australia over the same period there was always the great debate-again, I am not being party political about this-about whether we should or should not impose on the then most efficient sectors of the Australian economy, such as the agricultural sector and later the mining sector, the burden of a fairly heavily subsidised manufacturing industry. That debate went on for a very long time and was never really successfully resolved. The questions which that debate engendered were filled with sort of cargo cult stuff about a resources boom and things of that kind which would sustain El Dorado here to the year 2000 and beyond and that we did not really as a society have to address serious questions about the importance of a manufacturing sector in the economy as a whole. Those issues have changed, not so much because of things that we have done here but because the world environment has changed. We find ourselves, in terms of agricultural products, resource-based products and so on, in a highly competitive international environment. Very significant changes in the economies of countries such as Japan will lead to less and less demand for resources from this country. A whole range of issues which affect the international environment bring the debate to which I have just referred into much sharper focus and make it much more important to the overall economic well-being of Australia. The industry which is the subject of the Bill-again, I am not seeking to make a party-political comment-is a classic example of everything that went wrong. Currently, we have 17 manufacturers-or assemblers, to use Senator Short's term, which is much more precise-of heavy motor vehicles in Australia. They have been allowed into this country to manufacture without any question of the desirability or otherwise of fragmenting the market to that extent. Sixteen of those assemblers producing heavy commercial vehicles in Australia are 100 per cent foreign owned. There is one classic exception-a gentleman called Mr Whitehead. I do not wish to be unfair to his manufacturing establishment, but I understand that it is described as a tin shed. In a tin shed in Sydney he produces custom-built, dedicated heavy commercial vehicles for the mining industry. He is the only Australian producer. Over many years-I was about to say that he has cut his coat according to his cloth-he has built his vehicles according to the specific needs of a particular market in Australia, and I think that he has been quite successful. Otherwise, there has been none of that, and we have all the successful international manufacturers assembling here in operations with various degrees of success and various degrees of local content, but ranging up only to about 65 per cent local content. Amongst those companies, there has been very little attention to questions such as quality control, indigenous design, and so on. Why should there be? They are 100 per cent foreign owned. In a sense, this industry provides a convenient case history of what has gone wrong with the development of a manufacturing sector in this country. There are two ways of dealing with it. One is that one says that the Government will adopt a totally hands off policy, and the market will sort things out amongst those 16, and so on. If we went to that extreme, probably none of them would be here within a few months. All sorts of considerations are involved, such as the desirability of having some capacity in this country in respect of a very important industry, as Senator Short points out, in terms of its relationships with the transport industry and so on. Employment consequences and a wide variety of matters of that kind must be considered in the context of this industry. Senator Short addressed a couple of more specific questions to me. He asked what was the possibility of this industry becoming more outward looking and exporting. My frank view of the answer is none. There is no possibility of that-except to New Zealand; one or two companies send stuff across the Tasman from time to time. But if I were asked for my frank answer about the possibilities in the foreseeable future, that is, during our lifetimes, of this industry exporting its product, my view would be none. The reason is as I have said, that it is a classic colonial culture industry, foreign owned, fragmented, with no attention to the issues in the past which make a strong indigenous industry. We can do that in Australia; we have done it in some other area. Secondly, I was asked how the bounty relates to the passenger motor vehicle plan. I think that the relationship, as Senator Short himself suggested, is tenuous indeed. Senator Short asked me who the main beneficiaries of the bounty were. I have a list of who the main beneficiaries of the bounty have been up to 30 June 1984 but, rather than seeking leave to incorporate it in Hansard, as it would be totally boring for any reader of the Hansard, I merely table it. In that list, Senator Short will see all the names with which he is totally familiar-Volvo, Saab, Daimler, Mercedes-Benz; and International Harvester, until that company had a slight flutter downwards a couple of years ago, internationally as well as in Australia, which led to the demise of Rockwell in Australia, in my view, as a manufacturing operation. I was asked whether there has been any cost-benefit analysis on the extent of the bounty. I do not think that I am in a position to answer that question at this stage. However, I make the point, as I did previously, that all sorts of costs, hidden and otherwise, must be taken into account in assessing whether one wishes to retain an industry such as this in Australia and in what form. I was asked about the long term prospects for the industry. As I indicated previously, they are not particularly good in the industry's present form. Senator Chaney invited me to deal with a wide range of issues about labour market on-costs, labour market rigidities, strikes, cost of inputs, and a number of things. I am not running away from the invitation. I do not want to deal with them tonight. In this industry so many other factors impinge on its latent competitiveness. I never have disagreed with the view that all those factors are relevant to competitiveness; they are relevant. But so many specific problems impinge on this industry that I do not know whether it is appropriate to say that those things may contribute to making this industry less competitive. However, if one fixed up all those things, as one would like to do across the range of manufacturing endeavour, one would probably still have enormous problems with this industry because of some of the factors I mentioned earlier. I have to address myself to two other questions. On the first, yes, we have been slow about this matter; I concede that. It is enormously complex. One of the reasons for delay was that last year there was an important inquiry into the national road freight industry. A lot of material was given to that inquiry, which we felt might well impinge on what we ought to do about heavy commercial vehicles. That inquiry reported in September 1984, and then the election campaign started in October. The two reports, as it turns out, are not of great relevance to each other, but that was something about which we were concerned at the time. We have tried as much as possible to consult with the industry. There have been numerous consultations with my Department. They have taken place with all major assemblers, through the Federal Chamber of Automotive Industries and through the Automotive Industry Advisory Council. The Automotive Industry Advisory Council will be providing its final view on this matter-there is a lot of conflict about it-by the end of March, and I hope then to provide a more expeditious solution to the problems that this industry faces. There was, perhaps, one other question, but I do not recall it at this stage. I thank honourable senators for their support for the Bill. I welcome the contributions to the debate, which have all been about serious issues. But I again repeat that there are particular problems concerning this industry which put it in a pretty special category and perhaps require some very powerful medicine, which I am not sure is totally mixed at this stage. Question resolved in the affirmative. Sitting suspended from 6.30 to 8 p.m. Bill read a second time, and passed through its remaining stages without amendment or debate. Debate resumed from 25 March, on motion by Senator Aulich: That the following Address-in-Reply be agreed to: To His Excellency the Governor-General May it please Your Excellency- We, the Senate of the Commonwealth of Australia in Parliament assembled, desire to express our loyalty to our Most Gracious Sovereign, and to thank Your Excellency for the Speech which you have been pleased to address to Parliament. upon which Senator Chaney had moved by way of amendment: That the following words be added to the Address-in-Reply 'but the Senate is of the opinion that the Government's program outlined in the Governor-General's Speech fails to address critical problems facing Australia in that- (a) it fails to reassure the Australian people that the country's defence arrangements within the western alliance will be preserved and strengthened following: (i) the Prime Minister's capitulation to internal party pressures on the issue of Australia providing logistical assistance to the United States for its testing of the MX missile, and (ii) increasing uncertainty as to the future of the ANZUS Treaty fuelled by members of the Labor Government, including a Cabinet Minister; (b) it contains no coherent economic strategy at a time when recovery is threatened by: (i) record government taxation and spending, (ii) continuing pressure within the Government for new taxes on assets, (iii) growing demands for higher wages and other extra cost burdens on industry, (iv) the level of public debt repayments, and (v) loss of value of the currency reflecting world concern about Australia's competitiveness and government instability; and (c) it endorses a rigid, centralised wage determining structure which imposes the same cost burdens on commerce and industry regardless of ability to pay.' Senator RICHARDSON(New South Wales)(8.01) —I rise to speak in the debate on the Address-in-Reply to the Governor-General's Speech made in this chamber on 21 February 1985. I congratulate all honourable senators elected to this place in December 1984, in particular those elected for the first time. Having listened to a number of their maiden speeches I am certain that we can rely upon this being a livelier place for their presence. I look forward to hearing their dulcet tones more often in the weeks and years to come. I take us back for a moment to the 1983 election campaign because the Governor-General in his Speech gave something of a resume of the Hawke Government's achievements during that first two years before looking with vision to the next two. During that campaign under the leadership of Bob Hawke, the Australian Labor Party put to the Australian people an ambitious and energetic program designed to place Australia on a path of sustained economic recovery. The program was to embark us on a course of national reconciliation, recovery and reconstruction. Unlike our opponents, we had a vision of Australia as a place of equal opportunity where all Australians might fulfil their hopes and aspirations. That vision was translated into an ambitious program, which we outlined in 1983, based on creating a government for all Australians irrespective of their economic position or their political persuasion. We envisaged that a Federal government would work with the people, not against them, and would work to unite them not to divide them. On 5 March 1983 the Australian electorate heartily endorsed those lofty sentiments and gave the Hawke Government a clear mandate for the pursuit of policies designed to restore a tattered economy and to put an end to the politics of divisiveness. The Australian people, as they have so many times before throughout our history, turned to Labor at a time of trouble. Let there be no mistake about it: Australia was indeed in real trouble. We were in the midst of our worst economic recession since the Great Depression of the 1930s. There was little sign of relief in sight. Those problems were further compounded by restrictive, ad hoc economic policies advocated by the coalition Government. To illustrate the depth of that recession, the depth of the mire into which Australia had sunk, let us look at some of the statistics of our economic crisis at the time the Hawke Labor Government assumed office. Unemployment had risen to 10.3 per cent and was continuing to rise. By April 1983, 731,000 people were looking for work. For every week that the Fraser Government was in office, 1,000 more people joined our dole queues. Australia's inflation rate was more than twice that of other Organisation for Economic Co-operation and Development countries. When the Fraser Government came to office in late 1975, the inflation rate was around 12 per cent. When it left in 1983, the rate was 11.5 per cent. We must not forget the first Budget of the Fraser Government in 1976-77. The then Treasurer, Sir Phillip Lynch, said: As we have stressed from the outset, we have made our first priority, the absolute necessity, to combat inflation. What is the record? After seven years of this absolute necessity to combat inflation the former Government had managed to drop the rate by one-half of one per cent. Even worse was its record in economic growth. In the seven years to June 1983 real economic growth averaged 1.75 per cent per annum. Worst of all, in the last two years of the Fraser reign the economic growth rate was minus 1.2 per cent. We had negative growth. The economy was shrinking. The task before the present Government was clear. As the Governor-General stated in his Address: The Government's major task in its first term was the revival of the nation's economy. Our mandate was to try to sort out that troubled economy. If one wants to put it in cruder terms, it was portrayed as 'jobs, jobs and jobs'. That task was made more difficult and complex by the fact that most Australians had little confidence in their own country and little confidence in business, as shown by investment figures. Australia was floundering. To the relief of the Australian people and Australian business, this Government has been able to arrest many of the problems that beset our economy. We have placed it on the path to recovery. Since we assumed office only two years ago we have created almost 400,000 jobs, well on the way to the election promise of 500,000 jobs in the first three years that all the critics thought we could not deliver. The unemployment rate stands at 8.3 per cent, compared with the peak rate of 10.4 per cent. We have halved inflation. It is now comparable with that of other OECD countries although, of course, we intend to do even better. The most recent figures indicate that over the years to the December 1984 quarter the inflation rate was 2.6 per cent. That is a phenomenal effort when one looks at the position only two years ago. The last financial year saw real gross domestic product increase by almost 10 per cent. According to official forecasts economic growth in Australia over the first two years of the Hawke Government will total around 14.5 per cent. In two years we will have achieved more growth than the Fraser Government did in seven. All these things speak for themselves in a comparison between the previous Government and the current one. Other important economic indicators-private consumption expenditure, private business fixed investment, new dwelling and finance approvals-have also shown healthy improvement in the last two years. The electorate's faith in the Hawke Government was not misplaced. That ambitious program of national reconciliation, recovery and reconstruction was now well into its third stage. We were elected to arrest the problems of the economy and we will be judged by our performance. I suppose that our performance in managing it was the main reason why, on 1 December 1984, the Hawke Government was overwhelmingly re-elected. However, just so the Senate does not have to take my word as to how well the economy is doing and why the Australian people consider the Labor Party to be the most capable and competent economic managers I shall quote from the National Australia Bank's monthly summary entitled 'Economic Outlook-1985': Last year was a good one for the Australian economy. The last 12 months have seen strong growth in economic activity with real gross domestic product . . . estimated to have risen by around 4.5 per cent. The main impetus has come from real consumer spending which grew at a faster pace than expected, while housing activity built up progressively throughout the year. The farm sector also experienced near-record levels of output. Even more significantly, the levels of business profits increased solidly while inflation eased. The Prices and Incomes Accord was substantially adhered to and wage cost pressures were kept to a minimum. For example, award wages are estimated to have risen by only 4.3 per cent over the year. That is not a bad endorsement from one of Australia's major banks. Just to look at another independent, highly respected authority, the Reserve Bank in its economic review said: On balance, recent indicators point to continued expansion of the Australian economy in 1984-85. It is a far cry from the days of 11 1/2 per cent inflation, from 10 1/2 per cent unemployment and from minus growth of more than one per cent. Confidence, which was at an all time low just a couple of years ago, has been restored. Institutions such as the National Australia Bank and the Reserve Bank of Australia show just how much confidence the Australian Government now enjoys. Gallup polls indicate that the majority of Australians believe that the Labor Party is a better economic manager than the Liberal and National parties. As a student of polls over many years, I have noticed a change over the last five years. When one looked at polls five years ago, one saw that a great majority of the Australian people believed that the Liberals could better manage the economy. But now the pretender to the Liberal throne, John Howard, finds himself trailing well behind the Treasurer, Paul Keating, in opinion polls about who might be the better Treasurer. The Bulletin of 4 December 1984 published the results of its regular Morgan gallup poll. When asked which was the best party to manage the economy, 52 per cent of respondents said Labor, while only 26 per cent said the Liberal-National Party coalition-a 2 to 1 majority for the Australian Labor Party which, only a few years before, had fallen way behind in such polls. I turn now to some of the specific issues raised by the Governor-General in his address. The first and most important one is the problem of youth unemployment-the ugliest, the most frustrating and the most frightening statistic to come from Australia's economic recession. A disproportionate share of the burden of any economic recession has always fallen upon the young, but in the Australia that we have witnessed in the last decade that share of the burden has been even more disproportionate than history has shown it ought to be. When the Fraser Government took office, the unemployment rate of people between the ages of 15 and 19 was 12.9 per cent. When we assumed office in early 1983, just seven years later, that rate was up to 27.1 per cent. More than one in four young Australians was looking for work and standing at the end of dole queues. Their chances of finding a job were very slim indeed. They stood at the end of the dole queue, collected their cheque, and then looked at the board to see what jobs were offered. At the time 28 people were registered as looking for a job for every job that was available. They suffered from the obvious disadvantage of being underskilled and undertrained because of their inexperience. Unfortunately, some geographical factors contributed to some of the worst aspects of youth unemployment. There are large pockets of youth unemployment now in Australia. In New South Wales, for example, in the far western suburbs of Sydney there is a great concentration of unemployed young people, with all the attendant social problems that brings. It has spread to large country and regional towns as well. To take one example, the city of Lismore in northern New South Wales has an unemployment rate of over 30 per cent and a youth unemployment rate of around 50 per cent. Half the young people in Lismore cannot get a job. Senator Button —Whose electorate is that in? Senator RICHARDSON —I think it is in the electorate of Mr Blunt, a National Party member. If we consider youth unemployment, we see that in that very short period of history in which the Fraser Government occupied the treasury bench, it did enormous damage to the chances of any young person finding a job in Australia. This Government has made very significant inroads into unemployment. Its job creation programs are going very well. However, we have to concede that so far, after two years, after one term, the Hawke Government has made only a small impact on youth unemployment figures. The unemployment rate for young people is still way too high at 23 per cent. As the Governor-General indicated in his Speech, solving this devastating economic and social problem will be this Government's highest priority in its second term. We are not prepared to throw Australia's youth on the scrap-heap. We intend to give them some dignity. Most importantly, we intend to give them a job. We will not simply gamble as did the coalition Government, that one day in the dim, dark or distant future there might be a pickup in the economy which might solve part of our problem. It is obvious that we will have to do a bit more than that. The previous coalition Government did something worse than simply increasing the percentage of young people who were out of a job during the period of its reign from 13 per cent to 27 per cent. It managed to label as dole bludgers those who suffered from its weak economic policies that so eroded confidence in Australia. Time and again speeches coming from senior Government spokesmen of the day, in particular the Prime Minister, displayed the dole bludger syndrome. This myth was perpetuated and it largely concealed those hideous, immoral policies that led to so much youth unemployment. In our first term, we took some positive action to rectify this problem. We adopted some policies to benefit directly young unemployed. There were three fronts to this action to combat youth unemployment. First, we did the obvious in successfully stimulating the economy so that some of this unemployment could be soaked up. Where the private sector had been reluctant to invest or develop, the Government took up some of the load. Most notably on this front, the Government attempted to stimulate the economy via its housing programs. It is well known now that expenditure on public housing has risen 65 per cent to $623m, an all time record. By this financial year our first home owners scheme will have helped 135,000 young people into their first home. Through our community employment program, again we managed to get many young people jobs. Through the various road works programs, the Government increased road funding by $1,300m. In job creation and assistance programs, particularly the CEP, we tried to assist long term unemployed, to give them at least some kind of dignity and a pay packet. By the end of this financial year, the Government will have spent $698m on the CEP and will have assisted 65,000 unemployed Australians in the process. The scheme has other benefits, such as providing training for unemployed people to help them in the future to get a job. It provides the community with some vital projects that normally would not be funded and it generates additional wealth. We are now beginning to reap the benefit of some of these policies. More importantly, we have been implementing a package of training and apprenticeship schemes designed to provide the unemployed with the necessary skills and to encourage employers to employ apprentices, something which even the previous coalition Government had attempted to do for some time but with which it had little success. We hope that we will provide industry with a more skilled work force. We will all benefit from that, but it is hoped that those programs will benefit young unemployed the most. The Government is spending $435m on the schemes. I will just list a small number of them and the moneys allocated to them. An amount of $122.2m was allocated for trade training support programs. There has been a $36m increase in the non-trade skills training program and $108.9m has been allocated for the special youth employment training program. An amount of $50.9m is to be spent on employment and training assistance for Aborigines and $26.2m will be spent on the community youth support scheme. These schemes, although not solving the entire problem, contribute in their own small way to doing something about youth unemployment. Far more significantly, the Government has looked at two reports on this problem of long term young unemployed people. The first is Peter Kirby's report of the Committee of Inquiry into Labour Market Programs. Peter Kirby is from the Victorian Government and was seconded to do that report. In it there are a number of recommendations which the Government is now considering. I think they will go a long way to alleviating the problem, even in the longer term. The second inquiry is the Organisation for Economic Co-operation and Development Review of Australian Youth Policy. A number of conclusions in these two reports are common. They show that no matter which end of the scale we look at the problem from, no matter where we come from, some things have to be acknowledged if we are to begin to tackle the problem. The first and by far most important point is that we must realise that our existing training arrangements, our existing colleges for improving skills, are totally inadequate to service the needs of the people seeking employment in Australia today. The second point is that in order to remedy that we will need substantial funding to upgrade the training and educational facilities so that a better and more appropriate service can be offered. The third point is one we have neglected for too long. Both reports conclude that we need immediate support services for the people who have just left school. Too often we rely on some sort of reliable home environment to provide school leavers with support. Very often in some areas that reliable home environment is just not available. The Government is currently considering its responses to the recommendations and it has promised to try to make some of those decisions in the very near future. They will have a profound effect on young Australians and, I hope, their ability to develop as a fully integrated and expanding part of the Australian economy. If the Government fails to reduce significantly the unemployment rate for the young unemployed in particular, it really will have failed. That is our great challenge for our next term in office and, hopefully, it is the one on which we can embark as soon as possible. I turn to the last election. Much has been made of the changes to the Commonwealth Electoral Act that were put through the last Parliament. Changes were made to clear up an archaic system and, hopefully, to solve all the problems. When one looks in March at the December election results one sees that perhaps not all the problems were cleared up. I was a member of the Joint Select Committee on Electoral Reform, which looked at the Act for a long time and came up with a number of recommendations. The overwhelming majority of them worked very well indeed. However, we must acknowledge that there were some errors. Some of my colleagues who are not back in this Parliament today bear graphic testimony to that. Obviously the very high informal vote in the House of Representatives was not foreseen by us and each parliamentarian in this place could find a different reason for that. Looking back at the election results, I have no doubt that the advertising program upon which the Government embarked to show people how to vote formally in the Senate had a shocking effect on the informal vote in the House of Representatives. A House of Representatives informal vote of over 6 per cent is an extraordinarily high figure for this country. It is much higher than has previously been the case. While we do not have the final reports from the Australian Electoral Office, it is fairly clear that the great majority of the informal votes-certainly two-thirds of them-came from people who put the number one next to either the Australian Labor Party or the Liberal Party of Australia or whoever the preferred candidate of their choice was and then failed to allocate the rest of their preferences. As I have said, that is something that we did not foresee. However the Committee, which is again back in business, will be looking at submissions on this question over the next year or so and, hopefully, it can either change the system of voting or change the advertisements. We should make sure that when we next go to the poll the informal vote will be kept right down. I do not think that we should be concentrating simply on the 6.8 per cent informal vote for the House of Representatives and not looking at how much we got the informal vote down for the Senate. Informal voting for the Senate in New South Wales has been as high as 17 per cent. That figure has fallen dramatically to 5.6 per cent, which is a phenomenal drop. So the Government was successful in what it had seen as its major task, that is, to make certain that there was a formal vote by the electors who had for the last decade made as good an attempt as they could to vote formally but failed either through lack of education in the case of many millions of migrants who simply had difficulty in understanding our system or, in the case of the elderly in our society, simply a problem with their eyes. At one time New South Wales had 73 candidates in a ballot for the Senate. Generally speaking, we have had about 50 and it has been a mammoth task for anyone to cast a formal vote. In that respect, the Government was absolutely successful and I hope that people will acknowledge at least that. During the election campaign and since we have heard on a number of occasions in this place Senator Mason of the Australian Democrats talk about the allocation of preferences in New South Wales by the Australian Labor Party. This matter caused considerable consternation in my Party during the election campaign. All that needs to be said about it is that those people who reckoned that the Labor Party would contribute to electing the Liberals to the last spot were not being realistic. I always knew that that would not be the case; otherwise I doubt very much whether I would have agreed to what happened. I can recall hearing Senator Mason saying in a radio interview during the campaign how terrible it was that that situation would occur. The reality of the matter was, of course, that the Australian Labor Party's preferences elected Senator Mason and that was the obvious result from the very beginning. Senator Mason and the Democrats ought to consider that the real pressure within the Labor Party when one looks at the next election is whether to direct preferences to the Democrats or to the Nuclear Disarmament Party. We will all be intently watching the Democrats over the next two or three years to see whether the Government made a correct decision at the last election and to determine whether it would be appropriate to make the same decision for the next election. Despite the celebrations that I saw on election eve in the Southern Cross Hotel in Melbourne, it is a fact that the Labor Party won the election and won it very clearly. I will clear up some misconceptions that have been around about the Liberal Party's performance. I think that the Liberal party was in the grip of some false euphoria. The two party preferred vote for Labor remains at 51.7 per cent. There was a swing of 0.3 per cent against the Liberal Party in the metropolitan areas and in Victoria, the home of the Liberal's leader, Andrew Peacock, it suffered a 0.2 per cent swing against it. I thought that the Tandberg cartoon just after the election summed it all up pretty well. It depicted someone slapping Mr Peacock on the back at the celebrations and saying: 'Congratulations, Andrew. They said you couldn't do it and you didn't'. Senator Dame MARGARET GUILFOYLE(Victoria)(8.27) —I congratulate the honourable senators who have joined us for the first time and also those who were re-elected at the last election. We have heard some fine speeches from the new honourable senators. I wish them well in their parliamentary careers. I hope that we will have the benefit of the diverse experiences and backgrounds which they have brought into this place and that they will find their parliamentary careers are of interest and fulfilment to them in their aspirations. I have listened with some interest to Senator Richardson and his observations on the last election. His reference to a cartoon reminded me that there were not very many cartoons that suggested the Leader of the Australian Labor Party had won the election. They made one wonder why the polls had predicted there would be a 50-seat majority for the incumbent and how it was that, although Senator Richardson claims there was a formal vote of over 50 per cent for Labor on the two party preferred voting system, there was such a feeling of devastation among members of the Government Party at the result. As for Senator Richardson's observations about the election of senators from New South Wales, nothing that Senator Richardson has told us would indicate that he was predicting that the Nuclear Disarmament Party would achieve the vote that it did. It will be interesting to see the outcome for a single issue party of that kind at any future election and the effect that it will have on the support that the Australian Democrats can attract. I imagine that the Labor Party in New South Wales and in other places where there was a strong NDP vote will be observing, in the same way as the Liberal Party of Australia will be observing, just how consistent the support would be for a single issue party, given the broad range of responsibilities that rest with the national Parliament and the decisions the major parties have to make on a whole range of issues. We are speaking to the Address-in-Reply following the election of the new Government. I particularly want to address my remarks tonight to the matters that are raised in the Opposition's amendment that was placed before the Senate by Senator Chaney. There are a number of factors in that amendment to which I wish to speak briefly. First, I want to highlight the point that the Governor-General's Speech contains no cogent economic strategy at a time when recovery of the economy in this country is threatened by a record level of Government taxation and spending as a proportion of the gross domestic product, by growing demands for higher wages and other extra cost burdens on industry and by loss of value of the currency, reflecting world concern about Australia's competitiveness and the stability of the Government. Those matters are in the amendment that has been moved by the Opposition. The Governor-General's Speech really seemed out of date at the time it was delivered. It might have reflected attitudes that were felt towards the end of last year, but by the time we got well into February there were many concerns about the Australian economy and the level of our currency and these things were ignored in the address given to us by the Governor-General on the opening of Parliament. For this reason, the Opposition is drawing attention to the fact that there does not seem to be any cogent economic strategy in the speech and it is important at this time to look at the state of the Australian economy and the matters which should be considered by all of us. There were some pledges in the Governor-General's Speech and some of them were pledges from the Government towards strong economic and employment growth, particularly in the private sector. An attitude was expressed that the prices and incomes accord would continue to be the centrepiece of the Government's economic strategy. Explicit commitments were made by the Government on the deficit, relating to expenditures and revenue collections. There was, of course, a pledge for a major review of the taxation system in the principles that had been stated by the Prime Minister (Mr Hawke) at the end of October. These were quite strong pledges which had arisen throughout the election campaign and since the campaign. There was another interesting pledge, to move further unnecessary controls in the financial system and to increase the efficiency of the financial and business sectors. That pledge is of interest when one looks at some of the other regulatory approaches that are taken by the Government, for example in regard to wages. In the Governor-General's Speech the trilogy was highlighted-the commitment of the Prime Minister on the Budget deficit, Budget expenditures and taxation. He gave a commitment that those three areas of Government responsibility would not be increased as a proportion of the gross domestic product in 1985-86 and over the Government's term. The promises were dragged out bit by bit, but eventually we finished up with that situation. Then, on 26 February the Treasurer (Mr Keating) gave a further promise when he made the statement that we would see a money reduction in the deficit in 1985-86 over 1984-85. This was an important tightening of the commitment by the Treasurer and he also promised that there would be no increase in the Medicare levy. Therefore, we have an agenda of the trilogy and significant promises about the levels of expenditure, the deficit and taxation as we go into the Budget period. It will be of great interest to all of us to see whether these goals are achievable, and if so how they are achieved, because of the way in which the deficit will have an effect in the economy and the way in which the level of budgetary expenditure needs to be curtailed in order to fulfil the elements of the trilogy that have been announced. It was particularly interesting that, instead of showing firm control over monetary aggregates to re-establish market confidence in the Australian dollar, the Treasurer said on 26 February that the Government was not advocating a contractionary fiscal policy but that it was a government with a policy cast for growth. It seems to me that the growth we could well be talking about in the economy is a growth in unemployment, a growth in inflation and a growth-- Senator Button —You are one to talk; you would not know what economic growth was. Senator Dame MARGARET GUILFOYLE — It could well be a growth in interest rates, too. Those are the growth factors that are now introduced into the Australian economy. If we are honest and look at it rationally we will acknowledge that fact. It is one thing to have talked last year about a trilogy that had that effect; it is another to ignore the international effect on the currency, the way in which other people now view our economy. A position in February which showed a combination of a loose monetary policy, a falling dollar, full wage indexation still being demanded and supported by the Government and further wage demands still being supported by the Government leads me to say that the growth we see could be a growth in inflation, interest rates and further unemployment. Senator Button —And you are an expert on all three. Senator Dame MARGARET GUILFOYLE —There were two problems associated with the Government's move in January to abandon the August Budget's monetary targets, however difficult monetary measurement had become. Firstly, in the short term an impression was given in the market that the Government had discarded an objective discipline because it had become politically uncomfortable for it to exercise that discipline. The second perception which developed was that the Hawke Government was not prepared to see interest rates rise to maintain a firm monetary policy. Senator Button may not like those things being said, but that is the perception and that is the effect of the policy as we have seen it this year. In the Treasurer's statement in which he gave us the growth in the monetary aggregates, the release of the January M3 statistics, he said that the Government had decided against the further tightening of monetary policy which would have been required to achieve the Budget time M3 projection. In announcing that decision, he emphasised that the monetary aggregates did not appear to be providing a reliable guide to underlying monetary conditions. He said: The Government remains committed to non-inflationary monetary policy and the authorities will be maintaining an appropriately firm stance; and the whole range of monetary aggregates and other indicators of monetary conditions, as well as trends in the economy generally, are being monitored in the setting of monetary policy. That was his statement and I have made reference to it. The effect of it on the market place was one of concern and one that was fairly expressed in the remarks that I have just made. I turn now to another point in the Governor-General's Speech-the prices and incomes accord. The Governor-General said that this would continue to be the centrepiece of the Government's economic strategy. I think it is pertinent to link with this the statement, also in the Speech, that the Government would move further unnecessary controls in the financial system and increase the efficiency of the business and financial sectors. It is significant that over the period of the Hawke Government the Australian wages system has become rigidly centralised under the prices and incomes accord. This is not helpful to job creation or to combating youth unemployment. However much we might put forward policies which are part time solutions to unemployment for youth and which might create some temporary jobs, with the wages system as rigidly centralised as it is and with the conditions that apply to employment in this country, it is extremely difficult for us to overtake the youth unemployment which is of such grave concern. It is curious to see the deregulation of the financial system, which has been one of the Government's pluses, and yet find such a regulatory approach to the wages system. There will not be sustained economic recovery and more jobs in the private sector if the terms of the accord are continually applied. The Australian Council of Trade Unions has acknowledged that its concern is for those who are employed and not those who are unable to find employment. It is also acknowledged by the ACTU that full wage indexation is a luxury not enjoyed by any other trade union movement in any other country. It is curious to me that there should be an insistence on wage indexation in this country, despite its economic effects, when it is an advantage on anything enjoyed in any other country. Yet the ACTU wants more. As well as having full wage indexation, a benefit beyond that enjoyed in any other country, it wants superannuation, job redundancy improvements, supplementary wages, and now equal pay for comparable work. Australia still has 9 per cent unemployment. 50 per cent higher than that of most of our trading partners, and it is those included in the 9 per cent unemployed who are of concern. When one looks at the provisions of the accord and considers that it is central to the economic policy of the Hawke Government, one must express concern at the Speech made at the opening of the Parliament. These words appear on page 412 of the document containing the accord: Accordingly it is agreed: A centralised system of wage fixation is desirable for both equity and industrial relations reasons and will be advocated by both parties. To protect the purchasing power of wages and salaries the adoption of a system of full cost of living adjustments will be strongly supported in tripartite consultations and before industrial tribunals. Other points in this section of the accord include: In formulating claims for improved wages and conditions at the national level the unions will have regard to government economic policy and will consult with the Government on the amount of such claims. Both parties recognise that if the essential conditions of the centralised system are met that there shall be no extra claims except where special and extraordinary circumstances exist. The no extra claims provision will apply to both award and over award payments. That is the part of the accord that ought to be stressed, not what more we can receive out of the wages system and for what more can we ask. It is pertinent for anyone to ask at this time whether the Government will stand up to the unions and argue its economic policy at the national wage hearings that are to take place. The record shows a Public Service dispute that was very debilitating to the economy and that the Minister for Employment and Industrial Relations, Mr Willis, dealt with it in a way that led us to believe that it was an anomaly case. As I said earlier, the claim for equal pay for comparable work is now being proposed by the ACTU. That is of grave concern to employers as they look to how they are to move to the profitable employment of those to whom they are able to offer permanent work. It is somewhat of a moveable feast on the Government's approach to wages policy resulting from the devaluation of the dollar. We find various quotes from the Prime Minister, Mr Hawke, the Treasurer and the Minister for Finance, Senator Walsh, on these matters. For instance, when on 25 February the Australian Labor Party-ACTU accord was locking the Hawke Government into an economically irrational approach to wages, the Opposition asked the Prime Minister in the other place: Is the Prime Minister aware that any benefit to the competitive position of Australian industries from the recent devaluation of the dollar will be irretrievably lost if resultant cost increases are passed on by means of full wage indexation? Will the Government argue before the Australian Conciliation and Arbitration Commission that any future national wage increases should be discounted to take into account the effect of the devaluations on the consumer price index? The Prime Minister said that this was a valid question and yet the response in this place from Senator Walsh was that it was an audacious question. There seems to be very little consensus in the Government in the handling of a key economic question concerning wages policy. It is of concern to those interested when the Government approaches something as central to our economic health as the wages policy in this sort of way. It is no wonder that the headlines on 26 February indicated that business was bewildered by the Hawke wages view. Naturally, that sort of approach was felt by those who were looking to the Government for leadership on matters of such grave importance as the economic viability of their own businesses. Another matter highlighted in the Speech of His Excellency the Governor-General was the tax summit. This has probably been the most discussed matter since the Prime Minister stumbled on it as a solution during the campaign. He was unable to deal with questions relating to the Government's tax policy and so stumbled into a commitment to a tax summit. The tax summit is occupying the minds of many at the moment, including the Prime Minister. Business also is interested in what will occur at the tax summit. It is one thing to say that the tax summit will look at the mix of tax-at whether we will have more personal tax or more indirect tax-but business is interested, as far as tax policy is concerned, in whether the summit and any changes that might arise from it will focus narrowly on tax and ignore the level of government expenditure. I was interested to read and hear Senator Walsh's comments on this matter. It would seem that the Government is giving very serious consideration to the level of government expenditure, and it would be hoped that the trilogy commitment at least will be able to be achieved by the Government. Business is interested to know what focus on company tax will arise from the summit. The costs of wages and wage conditions and government regulation all impinge on corporate growth. As inflation rises when the effects of the dollar devaluation become evident, the dollar could weaken even further and, if we accept the Prime Minister's approach to wage fixation under the accord, the lack of confidence in this Government already evident in the commercial sector will intensify. Unless there is a real effort by the Government to recognise and ensure that high standards of living depend upon a solid dollar, a solid currency, and keen competitiveness as well as low inflation and realistic wage levels, the future can only look bleak. The Government cannot ignore these factors at a tax summit because again they are central to economic policy. The only sound we seem to hear from the Government at the moment with regard to the tax summit is the sound of a tax reform package. I would argue that the tax summit must focus on the level of government spending and on the political will that the Government can show in the structure of the 1985-86 Budget. The February 1985 edition of the Business Council Bulletin makes this interesting comment: The Governments Trilogy of commitments for the 1985-86 Budget are supported by the Business Council as the minimum necessary contributions to sound economic management. Analysis of projected receipts and expenditures in current or already announced programs made by the Business Council is presented. It suggests that these commitments will require a cut in expenditures (including payments to the States) of about two and a half billion dollars, with any new initiatives being offset by further cuts. A deficit outcome, on this early analysis, would be $5.5 to $6.0 billion. While the expenditure reduction task is admitted to be extremely difficult in political terms, understanding is called for from the whole community including all who will be affected in the short term. The social as well as the economic benefits outweigh the costs, and unless action is taken now more traumatic decisions will be required in later years. That is its view with regard to the casting of this Budget. It is also of interest that there is confusion in the sounds that come from the Ministers of the Government and the Prime Minister. The Prime Minister, a week or so ago, commented along the lines that it may be more damaging to abandon the summit than it will be to have it. That seems to be a fairly shallow way for the Government to approach something so central to its proposals for the future. Today, the Melbourne Herald talks about the Prime Minister's visit to Canada. It states: The Canadian Prime Minister had invited Bob Hawke to explain how his economic summit had steered Australia down the road to recovery. But the main thing Mr Mulroney heard from our master of consensus was a reading from the Hawke theory of political pragmatism. Not that Mr Hawke was not enthusiastic about the Canadian summit, although he did warn Mr Mulroney that they don't always work. For example, Mr Hawke said Australia's national tax summit in July would not necessarily lead to tax reform. Such words are not new from Mr Hawke, but they are a fresh indication of what is to come. We wonder how serious the Government is with regard to the tax summit; whether it will put something forward which it hopes will be accepted, or whether it is looking for some consensus, particularly in view of the further reporting today in the Australian Financial Review and other newspapers which speak of the ACTU position paper on tax reform. The headline in the Australian Financial Review is 'ACTU Position Paper Sets Scene for Hard Talking. Tax Reform: Now the Negotiating Begins'. This article and others today point to the fact that the ACTU has become a crucial element in tax reform because negotiations will need to be held with it on indirect taxes. The article states: As a key player in the poker game atmosphere developing in the run-up to the July national tax summit, the ACTU's position on such issues as indirect taxation-and a host of other issues canvassed in the paper-have taken on added weight. We are facing a tax summit with no agreed position from the Government on changes to indirect tax. There is no message from the Government on the way it will deal with corporate tax. The Prime Minister is telling people in Canada that 'you do not really get results out of summits' and we heard the comment from him a week or so ago that 'it may be more damaging to abandon the summit than to hold it'. If we are to set ourselves to any realistic taxation reform, it will obviously not be achieved in the way in which the Government is approaching the summit. I hope that, if it is not approaching taxation reform in a realistic fashion, it is facing that casting of the expenditure side of the Budget in a realistic way. I quote again the figures given by the Business Council of Australia in its review of what ought to take place in the Budget, that is a cut of something like $2.5 billion to achieve a deficit of about $5.5 billion to $6 billion. The Governor-General's Speech at the opening of Parliament outlined some of the reasons why the Opposition felt that it should move an amendment along the lines of some of the points I have raised this evening and the other points that were made on foreign affairs and defence matters. It was of concern to us that the Governor-General's Speech failed to reassure the Australian people that the country's defence arrangements within the Western alliance will be preserved and strengthened following, firstly, the Prime Minister's capitulation to internal party pressures on the question of Australia providing logistical assistance to the United States for its testing of the MX missile and, secondly, increasing uncertainty on the future of the ANZUS Treaty, fuelled by members of the Labor Government, including a Cabinet Minister. Those matters of foreign affairs and defence are of concern to us and we draw attention to them in our amendment. The other matters I have mentioned, such as the lack of cogent economic strategy, are important and deserve serious debate in the months leading up to the tax summit and the Budget for the forthcoming year. I commend the amendment moved by Senator Chaney. I hope those matters raised by me and by other Opposition speakers will have the attention of the Government. They focus on what we regard to be serious issues in the new Parliament. Senator TEAGUE(South Australia)(8.55) —I support the Address-in-Reply and the amendment moved by the Opposition. The Governor-General's Speech at the opening of Parliament on 21 February was prepared for him, as at the opening of all parliaments, by the elected government of the day and sets out that government's objectives, policies and programs for the course of this the Thirty-fourth Parliament. Accordingly, in the Senate in our speeches responding to the Address, we are responding to this presentation of the Government's program. I will direct my remarks this evening centrally to one significant item; the cause of peace, arms control and disarmament. The Governor-General set out the Government's program in these terms: The Government remains deeply committed to advancing the cause of peace, arms control and disarmament. At the Review Conference of the Nuclear Non-Proliferation Treaty to be held in Geneva in August and September this year, the Australian Government will make efforts to stop the spread of nuclear weapons and will continue to urge the nuclear weapon powers towards a complete ban on all forms of nuclear testing. It will actively promote programs for the International Year of Peace in 1986, and will advance the South Pacific Nuclear Free Zone proposal . . . the Government expects to continue to enjoy a mature relationship of mutual respect and close co-operation with our major ally the United States of America. The relationship between Australia and the United States under the ANZUS Treaty remains as firm as ever, and Australia's rights and obligations assumed under the Treaty are undiminished. As I see it, there are some seven commitments in that part of the Speech. The first is the general deep commitment to advancing the cause of peace, arms control and disarmament. That statement is entirely bipartisan because we on the opposition benches have a similar profound commitment to these goals. Secondly, we in the Opposition share the view that the Nuclear Non-Proliferation Treaty should be strengthened. I add only the rider that we should not put our faith in princes. We should not put our faith in treaties. Every time a war has broken out over the last centuries it has been because of the arrogant abuse of a treaty. We must not get too bound up with the legalisms and phrases, however well thought out the terms of a treaty may be. We must still look at the strategic reality of our defence. A third aspect is the commitment of the Government to a complete ban on all forms of nuclear testing. I concur with that and I believe it is long overdue that the French should desist from nuclear testing in the South Pacific. I would also like to see a complete end to any nuclear testing by the super-powers and China and, of course, any further proliferation to new countries, whether they be India, Israel, the Arab countries, or whatever. In these commitments is a bipartisan approach to the goals set out in the Speech. In the International Year of Peace, declared for 1986, there will be many initiatives. My remarks will look towards the argument, which I believe ought soundly to be put by the traditional strengths of the coalition parties, and which should have a profound grasp and understanding amongst the people of Australia. The fifth point is the South Pacific nuclear free zone. What does that mean? If it means forbidding nuclear test explosions and forbidding the dumping of wastes from the uranium or nuclear fuel cycle, I concur; but if it means our allies' ships being unable to come to Australia and, for that matter even New Zealand and other countries in the South Pacific, I do not agree and neither does the Government. The Government has not clarified its terminology when it says it will advance a South Pacific nuclear free zone. There is no doubt that even the New Zealand Government agrees to its naval ships taking part in naval exercises that include United States of America nuclear-powered ships, and even nuclear-armed ships, and that have tactics in manoeuvres which are based upon the eventuality of nuclear arms being used. Mr Lange has not precluded New Zealand from naval exercises involving that country and no doubt these will take place in the South Pacific. Therefore, there is a need for definition. I suspect that given the stated policies of the Government they will not be very far from the policies of this Opposition. The sixth point is the importance of Australia maintaining close co-operation with our major ally, the USA, and to build a mature relationship with mutual respect. Again, I concur with that, but I can only say that we in the Opposition believe that the present Government is not living up to those goals. I will come to that in a moment. With regard to the seventh aspect, that is the ANZUS Treaty, it is tragic to see the way events have swallowed up this Government in this area. The Prime Minister (Mr Hawke) is now on record as saying that ANZUS is hollow and that it is no longer effective. The Australian Democrats have gone much further and have said that ANZUS never was up to much and that, therefore, nothing is lost. I believe that the spirit of the ANZUS commitment which is calling for rights and obligations involving Australia, the United States and New Zealand has substance. It is tragic that the decisions of the Government, particularly over the MX testing in early February, have dealt such a major blow to the continuation of ANZUS. I concur with the Government in encouraging a continuation of the relationship between Australia and the United States. Senator Grimes —Have you any comments on what Mr Fraser said in London last week about ANZUS and its problems? Senator TEAGUE —My view is that we should continue to live up to the full meaning of all the words contained in the Governor-General's Speech and that this Government is failing in those respects. I agree with the commitments that I have mentioned, but I am sceptical about and disagree with the performance of this Government in the ways that I have mentioned. There are two matters in particular in which I believe the Government has let Australia down. The first is the failure to live up to our obligations as an ally to service United States ships and especially aeroplanes in the testing of the MX projectile that would have required Australian assistance recently off the coast of Tasmania. I believe that was an hysteria that swept the Prime Minister aside. I continue to support the views expressed throughout that time by the Minister for Defence (Mr Beazley), the Minister for Foreign Affairs (Mr Hayden) and other senior Ministers who wished to maintain the logic and soundness of the arguments which had led the Government to agree to live up to the obligations of being an ally in these matters. One of the arguments that was put by the left wing of the Australian Labor Party at that time and by hysterical minorities around Australia was that we should not be associated with the MX testing because it was an instrument of first strike, that it was a weapon of offence and that the acquisition of those weapons by the United States had given it a superior capability to initiate nuclear war. Senator Childs is in the chamber tonight. I remember in early February he made that view known publicly and within his own Party, arguing that this was a principal reason why Australia should not, in any way, be associated with this test flight. I will only acknowledge that if there were at least 280 MX missiles in the United States armoury they could be used as an instrument of first strike. Twenty-one of these MX missiles have been approved in the US. Negotiations by the President this week in Washington are to gain the concurrence of Congress for a further 21. It would be madness for the United States to fire the 42 MX missiles at the Union of Soviet Socialist Republics or any other country as a first strike. Each MX missile has 10 warheads which are designed, as I understand it, to land in a concentrated way on one target. They are highly accurate, some 70 feet long and 7 feet wide or, in modern language, 20 metres long and 2.3 metres wide. With their 10 warheads they can create a huge impact which will break hardened areas around missile launching sites in the Soviet Union. They are certainly the most powerful weapon that the United States owns in terms of strategic defence. If the United States were to fire all 21 MX missiles or if, should Congress approve the acquisition of another 21 as expected, it fired all 42 it could not eliminate the more than 1,000 strategic weapons, the SS18s and others, which are aimed back at the United States. I assert again that it would be madness for the United States to use such a weapon as an instrument of first strike. Therefore, I regard that claim by the left wing of the ALP as irrelevant, wrong and misinformation. The Australian public, and indeed the Government parties, were led astray by the claim which has been made by the left wing. The second offence occurred one year ago when the Foreign Minister, Mr Hayden, threatened the United States in Geneva in a very lame, immature and ineffectual threat. It does not live up to the words of the Governor-General's Speech, which I have applauded already. Immaturely he put the view that if the United States did not concur with the demands of Australia we would ban the United States bases in this country. I regard that as a nonsensical statement by our Foreign Minister. What are the American bases doing? It is well known that Exmouth is a means of communication with United States submarines, but that Pine Gap and Nurrungar are essentially satellite receiving communication stations. What are the satellites primarily doing? They are monitoring any kind of nuclear test and deployment of strategic arms. Insofar as it is essential that there be verification of the agreement between the super-powers-indeed, between any nuclear armed countries-these satellites are an essential part of deterrence. So what a nonsense it was when the Foreign Minister said to the United States: 'If you do not agree to our present demands we will deny you'. We would be denying ourselves by taking away the extra arm of deterrence of verification through the satellites provided by these bases in Australia. Australia and the world would be worse off. There would be potential for the destabilisation of the present relationship in strategic arms between the super-powers. When one looks at the nonsense of the Government's decision on the MX missile or the nonsense of the Foreign Minister's statement about the bases, one finds that we are right to move by way of our amendment to the Address-in-Reply: At end of motion, add: ', but the Senate is of the opinion that the Government's program outlined in the Governor-General's speech fails to address critical problems facing Australia in that- (a) it fails to reassure the Australian people that the country's defence arrangements within the western alliance will be preserved and strengthened following; (i) the Prime Minister's capitulation to internal party pressures on the issue of Australia providing logistical assistance to the United States for its testing of the MX missile, and (ii) increasing uncertainty as to the future of the ANZUS Treaty fuelled by members of the Labor Government, including a Cabinet Minister . . . Senator Ryan —Oh, yes? Senator TEAGUE —I hear Senator Ryan's interjection. It is no secret that the Cabinet Minister referred to is Senator Ryan. I shall briefly note the situation of the disarmament debate in Australia. The nuclear race in armaments began in 1945 when the United States, having developed the bomb, dropped it on Hiroshima and Nagasaki. I note that the bomb's use in 1945 is the only use of nuclear weapons that has ever occurred in the world. Forty years of non-use of nuclear weapons have followed because of the commitment-bipartisan in this Parliament and in most countries of the world-to take every step towards arms control and disarmament. The only use of nuclear weapons was to end a war. The sense of gratitude and relief in Australia and, indeed, throughout the whole of the Pacific was enormous when hostilities came to an end in 1945. Does anyone doubt that that war would have continued for months and months had there not been that, however tragic, loss of life in Japan as a result of the dropping of those bombs? A few years later the Soviet Union developed and tested such a bomb. In the 1950s France and the United Kingdom did so. Indeed, Australia was involved with the United Kingdom as an ally in the testing of its nuclear bombs in this country. In the mid 1960s China developed a bomb. At that point it was possible to see the nations of the world, not least Australia, limiting the so-called horizontal proliferation of nuclear weapons to a few countries. There was potential for more countries but, nevertheless, it stopped with the five countries I mentioned: The United States, the USSR, France, the UK and China. Whilst speculation about India, Israel and other countries existed, horizontal proliferation has not continued since the efforts made towards its end in the 1960s. What we have seen is a continuing vertical proliferation, especially at the hands of the two super-powers. In the period from 1945 until now, Australia has gone through three phases. First, it was the benefactor of the dropping of the bomb which ended the war in the Pacific. Secondly, we were a facilitator of UK tests during the 1950s. Thirdly, we became, to quote again the Governor-General's Speech, 'deeply committed' and, in a bipartisan way, an initiator of arms control and disarmament. However, the urgency is unrelieved. We must continue to take every initiative towards maintaining the urgency of achieving arms control and disarmament. I am on record in the past for welcoming the appointment of Ambassador Butler as a representative of this country, so ably putting arguments by way of public statements all of which I concur with. I agree with the goals of this Government in terms of the nuclear test ban and the renewal of the nuclear non-proliferation treaty set for this year. However, what has transpired, particularly in the last Parliament, has been the formation of a parliamentary disarmament group-a voluntary, informal association of persons from every party. The fact that I have spoken in this way and the reference to disarmament in the Governor-General's Speech demonstrate that the disarmament debate has become a reasserted debate in this country over the last year or so. In my first six years in the Parliament I have made a speech on disarmament, having done so in March of last year, and I was the Liberal representative and co-convener of the disarmament group. We sought to alert the Parliament to disarmament issues. However, it has been only in the last six months that this alert has been taken up. Despite the long record throughout the Menzies period and the Fraser Government's period of Australia having been an initiator in the area of arms control and disarmament and despite moves by individuals in all parties during the last Parliament, a new factor emerged during the last election, which was the enormous Press coverage given to one tiny element of the disarmament debate. That tiny element was the battle among the Nuclear Disarmament Party, the Australian Democrats and the left wing of the Australian Labor Party for some four, five, six or seven per cent of the public's vote. The attitude of each party to this issue was: 'We will unilaterally act to create a practical agenda of so-called disarmament which will outdo all the others'. In that battle and what I think was a very superficial but highly publicised debate we had the NDP, the Democrats and the ALP Left all clawing at the same ground, saying to each other, 'We will toss the American bases out quicker than you. We will stop nuclear ships quicker than you. We will do all that we can to make sure that the MX missile is not acquired by the United States', and so on. I believe that that clawing at the ground, that minority aspect of the disarmament debate, has, by its prominence in the last election, led to a skewing and a distortion of the public's perception of what this Parliament is saying about the way ahead for arms control and disarmament. I, along with the Opposition, continue to advocate a responsible approach to arms control and disarmament and the prevention, by better information and argument, of the misinformation and nonsense that has been put about by the NDP, the Democrats and the left wing of the Labor Party as the way of salvation ahead. Therefore, I draw attention to the policy statement of the Liberal Party on disarmament and arms control which was put forward in October last year during the election campaign. It referred to confidence building measures, verification and compliance, strategic arms reduction talks, intermediate range weapons, North Atlantic Treaty Organisation-Warsaw Pact force reduction, chemical weapons, radiological weapons, the importance of a comprehensive nuclear test ban, arms control in outer space, nuclear non-proliferation and, indeed, the importance of the United Nations Conference on Disarmament. In this statement the Liberal and National parties addressed themselves to the importance of United States facilities in Australia and related them to armaments and the prevention of war. We maintain that it is not armaments in themselves that create war; it is the decisions to precipitate conflict that do so, and these are made by men. We should not put our trust in treaties, the lack of armaments or any unilateral arms reduction as the ground for a secure peace. Rather, we should get to the causes of war and ensure by deterrence, mutual reductions in arms, encouragement of mutual understanding and, indeed, by realistic measures to prevent the use of any nuclear weapon, that we prevent war and the destruction of the world. In the statement we also mentioned community involvement, the Western alliance and the high world costs of defence. This was the most comprehensive policy of disarmament and arms control put forward by any party during the recent Federal election yet, as I have said, the whole debate was distorted by the media concentration on the superficial aspects of this three-cornered clawing at the ground between the NDP, the Democrats and the ALP Left. As one member of the coalition and a Liberal senator from South Australia I wish to say that we must go a long way to more detailed and specific statements in this area of policy than even this, the most substantial of the policies that were put forward in the last Federal election. We must go on to take up the strengths in the Governor-General's Speech and the references to this area with substance and argument. In this brief half-hour I have had the opportunity only to introduce that subject. I would have liked to go on to analyse the use of words, the rhetoric used by the Democrats and the left wing members of the ALP in the recent debate in this chamber on nuclear ships. I certainly welcome the acceptance by both the Government and the Opposition that the initiative from the Democrats is nonsense. It is appropriate for us to live up to our obligations under the alliance with the United States of America. Had I the time I would have referred to the central argument that Senator Chipp put forward at that time, which was that the United States must take the initiative to disarm. He claimed-I believe falsely-that this is the initiative which led the USSR to disarm. I believe that thesis is wrong. History in the 1970s in terms of SALT I and II shows that while the United States was restrained and involved in those negotiations the Soviet Union took every opportunity to build up its stockpiles, to develop its research and to create new weapons, culminating in the deployment of the SS18s and SS19s as strategic weapons and the enormous departure from the spirit of those arms negotiations with the deployment of the SS20 as an intermediate weapon in Europe. One could go on to talk about the details of the MX, the lessons to be gained from the 1970s arms control and so on. This will be the subject of future discussion and debate in the Senate. Senator BJELKE-PETERSEN(Queensland)(9.25) —In speaking to the Address-in-Reply to the Governor-General's Speech at the opening of Parliament I wish first to congratulate the new senators and compliment some of them on the excellent speeches that they have made in the Senate. I take this opportunity to speak about some issues that I feel are of great importance. The Governor-General said that the breaking of the drought has enabled our primary industries to regain some of the momentum of the good years of the 1970s, although I am sorry to say that it is too late for many of our primary producers. I do not believe that we can overemphasise the importance of primary industries to our Australian economy and, of course, in my own case, to the State of Queensland. However, all too often the Government has had the tendency to highlight the so-called glamour industries, which comprise tourism, mining and high technology industries. But when all other industries have been fully exploited or have simply expired we will still need our pastoral and agricultural industries, irrespective of the low image that they have with this Government. Of course, compounding this problem is the fact that many people think of the agricultural industries as heavily subsidised even though the reverse is the truth. Whilst agriculture funds a substantial part of general industry assistance elsewhere in the economy, assistance to the farming sector comprises only a small part of overall government subsidies. Basically, increases in farm costs well in excess of upward movements in the consumer price index are jeopardising the viability of our agricultural sector. Indeed, this conclusion is supported by the evidence contained in the Livestock and Grain Producers Association's farm costs submission which has been forwarded to both State and Federal governments as part of a major farm cost campaign being conducted by the National Farmers Federation. The Bureau of Agricultural Economics has estimated the average 1984-85 income per farmer as approximately $6,598 including the return to invested capital. This is only one-third of average national earnings and has put into jeopardy the livelihood of thousands of farmers and their families. The National Farmers Federation's detailed case to the Government showed that the farm sector employed one million people and produced $10 billion in annual export income. It stated that government meddling, unfair taxes and massive protection to other industries hobbled the farm sector. It went on to say that the ability of the Australian farmers to sell overseas had never been worse than over the past 12 months, partly as a result of government charges. Since 1980-81 Australian farm costs have risen 41 per cent-more than twice the 17 per cent increase faced by farmers in the United States of America. It also added that costs of imported machinery spare parts were 216 per cent above United States prices. The Farmers Federation argues that an immediate across the board tariff cut of 10 per cent is needed. Is it any wonder that the average income for farmers is only $6,598 per annum? I am quite sure that not many workers in Australia would like to do a seven-day week, in many cases from early morning until late at night, and receive a return like that. Significantly, the number of Australian rural producers dropped from 232,000 in 1964 to 196,000 in 1984. The Federal Government really must face up to some hard decisions concerning the future of Australia's rural industries. Even though our rural industries registered an all time high aggregate value of production last year and will produce just below that record this year, our farmers are still in dire straits. The real net value of rural production in 1984 was 17 per cent below that of the previous year. Yet, if the shackles of high costs and low world prices could be removed, our primary industries could and would act as the catalyst for a tremendous national economic recovery. At the recent National Farm Outlook Conference, the Minister for Primary Industry, Mr Kerin, indicated that farmers need not 'come running to the Government for financial assistance'. It seems incongruous to me that whilst the United States Government and the European Economic Community have taken strict measures to ensure protection of their primary industry sectors by stepping up subsidisation measures for farmers, the Australian Government has, sad to say, reduced its level of assistance. Indeed, it has taken measures to thwart any attempts at recovery, through such imposts as excessive tariffs on imported goods, excessive spending and borrowing, promotion of an inflexible labour market, over-regulation of service industries, and government taxes and charges. High costs and low world prices must be addressed by this Government for the rural sector to be able to realise its enormous potential. It is a sad fact of life for the farming community that farm costs are much higher in this country than those which are faced by our competitors, and, of course, consequently, we are suffering very much in the competition stakes. We need to look only at the level of taxation rises over recent years to see the effect that they have on farm costs. Tariffs are crippling our primary industries. The impact of the tariff on imported harvesters alone has meant adding five figures to the cost of every new harvester that a farmer purchases-and I do not think that anyone would say that a harvester was a luxury item. The Government should be looking specifically at implementing initiatives in the areas of tariffs and taxes, wages, interest rates, transport costs and fuel, in order to set the wheels in motion towards a flourishing rural economy. Besides the removal of tariffs and sales taxes, we need greater flexibility in the wage fixing process, reductions in interest rates for public sector borrowing, the removal of monopolies in rail transport used in the transport of primary products, and a commitment to remove all excise paid on diesel fuel for off-road purposes and that used by the railways in the transportation of primary products. At Kingaroy, if one wants to get a rebate on the cost of one's diesel fuel, one has to fill out forms. One is supposed to fill them out, I guess every month, but sometimes it takes a lot of effort to get them organised and get them in, so many farmers throughout Queensland probably think that it is hardly worth the bother. But my Scottish blood demands that I complete those forms, submit them and get my rebate for the diesel fuel. It was much easier in the days before these rules and regulations were introduced. With regard to petroleum products, I have received a letter from the Royal Automobile Club of Queensland, and I would not be surprised to learn that all Queensland senators have received the same letter. I am sure that Senator Boswell has received it. He is in the chamber tonight. I would not be surprised if our Acting Deputy President, Senator Jones, had received it also. It is a letter to Queensland's Federal parliamentarians about the current import parity pricing policy for petroleum products. The RACQ says that it is unrealistic and it must be changed. The letter was written on behalf of its 487,000 members protesting strongly against the Federal Government's present import parity pricing policy for indigenous crude oil. I would not blame the RACQ for one minute for writing such a letter. It states: Already this year that policy has added 2.5c per litre to the wholesale price of petrol and further rises of up to 5c or 6c are expected within the next two months. It is quite a long letter. It went on to say: The RACQ believes that the price of Saudi Arabian light crude oil is no longer appropriate as a benchmark for the pricing of Australian crude which should reflect- (i) the price which Australian refiners would have to pay for comparable crude on world markets if no indigenous crude were available, and (ii) the price which Australian producers are able to obtain for exports of indigenous crude. This is a very sensible approach to the problem. When the present Government is collecting all the money from the extra fuel excise, I sometimes think back to some of the things that were said during previous election campaigns. At the 1983 election, the present Treasurer, the Hon. Paul Keating, when he was shadow Minister for Resources and Energy, said: When we win government we will guarantee the public much cheaper fuel, and LPG will be reduced to its original price. That is a promise that the Treasurer has not kept. I wonder whether the cheap fuel has evaporated, like his promises. Senator Peter Baume —Did he ever intend to keep them? Senator BJELKE-PETERSEN —He might have meant well before he started, but when he became Treasurer he could see that he was getting a great big rip-off from the fuel pricing policy, so the Government thought that that was fair enough. I have a cutting of a letter that Mr Goodluck, the honourable member for Franklin, had published in a newspaper in the last few days. He produced a form of advertisement that was used by the Australian Labor Party during the 1980 election campaign. It said: From January 1, 1981, a Labor Government would freeze the price of locally produced crude oil. After 12 months petrol would be 2.4c a litre cheaper than if overseas price rises continued to be passed on at their present rate of increase. Apparently what one says in opposition is quite different from what one does when in government. Recent talks in Brussels between the Prime Minister, Mr Hawke, the Minister for Primary Industry and the EEC have failed to result in absolute guarantees for Australia's beef, sugar and dairying industries. We are all aware that over the past 10 years the EEC, because of its surpluses, has been dumping its primary products on to the world market. This is very sad from our primary producers' point of view. The EEC replaced Australia as the world's major beef and veal exporter in 1984, and that situation is expected to continue this year. Having cattle people in my family, I think that that is rather sad, because beef producers are a very important part of our primary producing people. The Prime Minister and Mr Kerin held discussions in Brussels concerning the plight of Australia's sugar industry and the low world sugar prices. This is a matter that should affect not only Queensland senators and members but also every member of our Senate and the House of Representatives. The EEC subsidies to sugar producers last year totalled $1,100m, or $500 per tonne when the free market price was about $140 per tonne. Sugar subsidies have led to so much beet sugar being grown that Europe, only recently a net importer, is now the world's largest exporter, pushing up to 4 million tonnes on to the world market. Queensland's 6,200 cane farmers had very little reason to celebrate after our Government's talks in Brussels. On the other hand, over the past two years the Queensland Government has provided $31m in positive assistance to the sugar industry through several avenues. It provided $15m towards carry-on finance in 1983-84 under the rural adjustment scheme. It gave $5m carry-on finance to cane growers in 1984-85; $10m in Treasury loans to six co-operative sugar mills; $175,000, being half the cost of the sugar industry review which is expected to take up to two years; and $800,000 towards the interest component to raise the first delivery payment from $160 to $180 per tonne. The Hawke Government has provided only $16.5m assistance to the sugar industry, one-half of the total of the Queensland Government's assistance, despite a pledge by Mr Kerin that support for the sugar industry would be a first priority. Sugar was Australia's eighth largest export commodity in 1983-84, earning $619m export income for this country. I view very cynically the fact that our Federal Government can find $176m for the steel industry and $150m to prop up Australia's car assembly plants but cannot find the amount of money required to help our sugar industry. That is very sad indeed. The Federal Government receives every year $80m in excise on potable spirits. These are some of the points I want to bring to the Senate's attention this evening. When I was speaking in the debate on the sugar industry I mentioned that 1,200 cane growers descended on Brisbane last year to voice their concern to the Prime Minister when he was there. He said that he would undertake a financial commitment to assist them on the basis of a review. Unfortunately, a review takes a long time-it is very slow-and in the meantime the poor sugar farmers are going to the wall. About 20,000 Australians are employed directly in the sugar industry with an indirect flow-on of another 100,000 jobs, all of which are affected very detrimentally by the problem of the sugar industry. The livelihoods of thousands of cane growers and their families are threatened by the inaction of this Government. Coming from the State which is responsible for about 95 per cent of our total sugar production, I find the situation intolerable. Another rural industry with severe problems at present is the dairying industry. The Minister for Primary Industry, Mr Kerin, has rejected out of hand two years of effort by the Australian dairy industry to produce a national dairy plan to rationalise the industry. The scheme was one of co-operative self-help which involved the transfer of resources to the manufacturing milk producers, mostly in Victoria, from the liquid milk sector. The plan announced by the Minister will cut production by more than 20 per cent by 1990 rather than the gradual fall of about 10 per cent envisaged under the modified Australian Dairy Industry Council plan. The shadow Minister for Primary Industry, Mr Hunt, said that the dairy farmers of Australia had been sold out through one of the most cynical and disgraceful political stunts ever played on any section of the community. There has already been substantial adjustment in the dairying industry with the numbers of producers having fallen from 49,000 to 19,700 in the last 20 years. In Queensland alone, we used to have 25,000 producers whose numbers were reduced to approximately 5,000. That is a big reduction if ever there was one. I feel that the dairying industry has certainly rationalised its operations. The dairy farmers in Queensland are very concerned about the whole proposal. I point out that Australian farmers are among the least protected in the community. The level of effective protection has fallen from 28 per cent to 9 per cent in recent years. I feel that this Government's dairying plan is a virtual declaration of war on farmers generally. Not only has the sugar industry been hoodwinked by pre-election promises, but, I regret to say, the dairying industry has been dumped also. As a matter of fact, the Minister, Mr Kerin, said recently that, whatever happens to the dairying industry, quite a few farmers will go broke. Whether there is deregulation, or whatever happens, many farmers will go out of the industry because production has increased beyond what can be sold at a profit. That seems to me to be very bad news for the dairying industry. One aspect of the debate over the viability of our primary industries which I do not think has been given enough priority is the devastating effect that industrial disputes are having, not only on our production performances, but also on our reputation as a reliable trading partner. Strikes which have occurred recently, and are still occurring and are looming on the horizon, are likely to send farm input costs soaring and will certainly cripple the once-reliable supplies of farm exports. In the past two years, the amount of industrial unrest affecting agriculture has hit an all-time high, despite the industry supposedly having a truce with the unions-in some States anyhow-and the accord which was achieved by Mr Hawke early in his term of government has seriously cracked and looks as though it could self-destruct at any tick of the clock. I believe that the majority of Australians want the Government to take some permanent action to halt union attempts to undermine this nation's future stability. I am quite sure that rural producers and all Australians are sick and tired of strikes. The slump in our dollar has created concern about a possible flow-on to wages, which will surely test the Government's prices and incomes accord. Even though the Hawke Government has reaffirmed its pre-election promise not to allow increases in the deficit, taxation or government spending, some Ministers have now forecast new and increased sales taxes, capital gains taxes, death duties and gift taxes, not to mention Senator Walsh's startling admission of the possibility of a means test for the spouse rebate. Despite our traditions of being a hardworking nation of people, industrial disputes seem to be becoming part and parcel of our way of life. We cannot afford the tremendous costs that strikes inflict on the community, on business interests and on our relationships with our trading partners-Japan, the United States, and the European Economic Community. Even Mr Nakasone on his recent visit stressed that Australia's reliability as a supplier was essential to future trade. Already, a Swiss-based report by the internationally-recognised European Management Forum indicates that Australia has slipped from twelfth position to sixteenth in overall competitiveness. I will not go into all the details about the industrial unrest in Queensland and the problems that it has caused. We had a very interesting matter of public importance debate yesterday. Because of the strike, the Queensland coal industry lost $9m a day in export income. That is a lot of money in anybody's language, and the bill has already topped $100m because the Queensland Colliery Employees Union joined the strike in sympathy with the Electrical Trades Union. However, Queensland is not the only State which has had problems with strikes. New South Wales has had lots of strikes, including railway stoppages and silo workers strikes. In the past year alone, they were estimated to have cost grain growers $100m in lost contracts. On an Australia-wide industrial front the year 1985 certainly looks very worrying for industrial relations. I want now to talk a little about the assets test and the effect that this test will have on some sectors of the aged population. The process of farm valuations is a scandal. I do not need to remind honourable senators that many people in the community feel that they are being victimised in the course of the valuation of assets. As a matter of fact, I have heard of some cases in the South Burnett area of assets test inspectors having valued land at about six times the amount the accountants said that the land was worth, the accountants' valuation being 10 times more than that of the Valuer-General. That is one of the problems that I have heard about. I think that Senator Boswell intends to tell the Senate quite a deal more about that matter. I am assured that pensioners who have had small land holdings in the family for generations are being advised to sell up and move to the city because their pensions would be cut because of the high valuations of their family properties. No doubt the Government is sincere in trying to weed out the people in receipt of pensions who are not really entitled to them, but it has really gone too far. I wonder where our sense of initiative and enterprise will end up after so much government interference, which is having the effect of making people ask: 'Why should I bother?'. This country was built on the principles of hard work and determination, with the thought of reward for enterprise at the end of it. Nowadays, if the Government actually allows us to go ahead with some venture the unions will get at us; if they do not, the tax man will. That is how it works out. Is it any wonder that we are beginning to breed a race of Australians who see that there is no point in having a job or earning a decent wage for an honest day's work when they see their fathers struggling to hold on to a small business, their mothers out working to try to supplement the family income and their friends finding it almost impossible to obtain a job? I think the idea that is being promoted of doing some work for the dole is an excellent idea. I have been saying that for years, but unfortunately nobody has said they can do anything about it. There are think tanks all over the place in Canberra. I think it would be a very good idea if somebody came up with a scheme whereby young people, or indeed anybody in receipt of the dole, did something for it. I can remember the man who used to live over the road from us during the Depression. He could not earn any money to keep his family of four girls. He had to go to work on the Kyogle railway before he could draw his dole. It was not called the dole then, it was called the unemployment benefit. His Excellency, the Governor-General, referred to the fact that this country, under this Government, was embarking on a course of national reconciliation, recovery and reconstruction. I cannot agree with that. I am afraid for the very heart of our economic strength and our national identity-our primary industries. I fear for the employer of some 60 per cent of the Australian workforce-small business-which is defenceless against the unions' might and all consuming quest for power. I fear for our young Australians who see a future filled with excessive government charges and taxes and who think to themselves: 'Why should I even bother to try to make a go of it? They'll never let me'. Senator REID(Australian Capital Territory)(9.54) —The Governor-General's address to the Parliament, written by the Government, gave a glowing account of many areas of government activity. I want to analyse exactly where we are going in Canberra, how we are going to get there and what the present signs indicate for the future of this Territory. Is it, I wonder, that the people of Canberra are being taken for granted by this Government, or does the Labor Government really just not care about the people of Canberra? The honourable member for Fraser (Mr Langmore) gave his maiden speech in the other place just recently. It was reported in some detail in the Canberra Times under the heading: 'Major Problems in ACT Administration'. There seems to be a number of problems in a number of areas which give us good reason to wonder exactly what the future holds. We are entitled to expect that self-government will occur. It ought to occur quite soon if one is to believe the statement in the Governor-General's address to the Parliament on 21 April 1983, when he said: My Government is committed to bringing self-government to the Australian Capital Territory. As a first step, a broad range of local government powers will be transferred to the House of Assembly. In twenty months that did not occur. It is strange indeed that in the Governor-General's Speech which we heard just recently there was not one reference to self-government. The Governor-General did not refer to the Australian Capital Territory at all. If it is a fact that the Government is not proceeding to self-government for the Australian Capital Territory, we are entitled to know what arrangements will be put in place for the future of this community. If it is proceeding to self-government, as seems likely, we are also entitled to know what the arrangements will be. We have had the report of the National Capital Development Commission. We have had the Grants Commission report, which perhaps raised more questions than it provided answers. We have had the report of the Task Force on Self Government. We are told there is to be a paper presented on options. We have had a paper relating to options in education. The whole question of self-government certainly seems to have generated a great deal of paper, but not yet the answers as to what is to happen to this community in future years. If one looks at what is happening and the rundown in so many areas, one becomes concerned about the growing list. I am in no sense suggesting that the present Minister for Territories (Mr Scholes) is responsible for this. He has had the job for only a very short time and for about four weeks of that time he was in ill health. There are signs that he takes quite seriously the job that he has, but prior to his becoming the Minister a number of things occurred which gradually added up to a picture which gives us cause for concern. We can analyse some of the things to which I have alluded. In the area of housing we saw in August 1984 the sudden and dramatic demise of the Commissioner for Housing loans scheme. It had been a scheme that had been, one might say, talked up by the previous Minister. He had spoken frequently about his aspirations for providing housing. While that is very commendable, he ought not to have allowed his words and his encouragement, especially to low income earners, to exceed his potential to deliver. It transpired that within a few days of the presentation of the 1984 Budget the Commissioner for Housing loans scheme was dry of funds. It had to receive an additional $7m even to honour those commitments which very clearly legally had to be honoured. Of course, there were many other people on the list for the loans who had very high expectations, as they were entitled to have, and had taken steps that they reasonably could have been expected to take towards getting a house. They were not only disappointed but in many instances also quite shattered. Many had made moves in expectation of what they would be able to do. Just the other day we learned that there had been no sale of government houses since September 1983, and they were only ever sold to lower income earners. The qualifications for buying one of those were such that nobody in rented government accommodation was eligible to purchase. What possible scheme could exist which would preclude people in that category from purchasing? It was supposed that if they could not purchase on the open market they would be able to purchase a government house. Eventually, there was no money left for this possibility in any event. We have had problems with young people, in particular, in need of accommodation which has not been available. Young people have had sit-ins in a number of dwellings in an attempt to demonstrate their need for accommodation. I am not suggesting that their action was right, nor am I condoning it; but it does highlight the problem. Last year we were told by the previous Minister for Territories, in announcing the community housing expansion program to which he pledged $669,000, that the program was a model that could well be taken up nationally. It seems that the program is now being abandoned. Only $400,000 of the allotted sum has been given to the program and it seems that the balance of the funds has been withdrawn. We have had a proposition from a private sector developer to turn a drive-in theatre site into a mobile home park. This could be done quite quickly and would provide lower cost accommodation. It would provide, in the short term and quickly, accommodation for those who wish to come to Canberra to work in the building industry. As a result of the new Parliament House project, the Australian Defence Force Academy project and other projects, the building industry in the Australian Capital Territory is fairly buoyant at the moment. For some reason that I fail to understand, the NCDC appears to have rejected that proposition out of hand. If it has good reason for doing so, it does not seem to have made it apparent. Another matter to which I refer is the question of making good use of government money which is spent in the Australian Capital Territory. The previous Minister certainly embarked upon a project of land development by the private sector of which the Liberal Party of Australia had previously approved and adopted as a policy but had not got under way. It is not necessary for vast amounts of government money to be used for land development. Of course, the cost of land development is recovered from the sale of land and in the last couple of years millions and millions of dollars from the sale of land in this community have gone into Consolidated Revenue. However, the problem with the presentation of figures means that on the one hand money spent by the National Capital Development Commission on developing and servicing land is shown as a cost and something that is spent on our behalf, but the money that is recovered by the Government appears in some other set of papers as income and the two are not related. Certainly the profits that are taken out of this community in relation to land development show up nowhere as something which has been contributed by this community. Recently the Government embarked upon the development of the Chisholm shopping centre. It was delayed considerably but it is finally under way. Both the land servicing and the development of the shopping centre are to be a private sector development. I think it is very clear to everybody that when the Tuggeranong town centre development goes ahead it also ought to be a private sector development. No taxpayers' money should be diverted to that project. At present it seems that the Canberra Commercial Development Authority has been given the go-ahead but has received no money. A recent article indicated that the Chairman of that Authority still believed that it ought to be another government shopping centre, as is the Belconnen Shopping Mall. I totally disagree with taxpayers' funds being used to provide anything towards shopping centres in the Australian Capital Territory or elsewhere and it is not too late to see that this development is done properly. Any honourable senators who do not know the exact site of the Tuggeranong town centre will be amused, no doubt, to find that it is situated close to the Murrumbidgee River, right on the edge of the Tuggeranong development, given the commitment by Mr Uren not to develop the west bank of the Murrumbidgee, a decision which I support. Perhaps the siting of the Tuggeranong town centre-if it is to be town centre-ought to be seriously reviewed. These are just some of the matters of concern in the area of housing which perhaps come under the heading given to the report in relation to the speech of the honourable member for Fraser; that is, 'major problems in Australian Capital Territory administration'. We have also had a pretty sorry history in health. We now have waiting lists for elective surgery. I could hardly count the number of times in the last couple of years that elective surgery lists have been cancelled at short notice for one reason or another relating to industrial disputation. We have experienced delay in the opening of Ward 12B-the mental health ward-at the Woden Valley Hospital. We have waited many years to get the mental health ordinance and finally- Senator Grimes —Margaret, this is the national Parliament. We don't want any of this council stuff. Senator REID —I am very disappointed that the Minister for Community Services is not more sympathetic to the plight of my constituents. About 14 Ministers have responsibilities for areas of administration in the Australian Capital Territory. Perhaps the Minister missed my reference earlier to the developments concerning self-government. The Government needs to decide whether the various Ministers are going to look after the Australian Capital Territory or whether there will be self-government. At present we seem to have the worst of all worlds. The opening of Ward 12B was delayed for a variety of reasons, including a variety of industrial disputes and lack of staff. It was alleged that our nursing staff were paid less than those who worked in other places and staff could not be recruited. Recently we had a similar problem with the detoxification unit at the Woden Valley Hospital, although an article in yesterday's newspaper indicated that it may yet open on time. It is to be hoped that it will. Had there not been the delays, perhaps it could have been opened sooner. We had a hospital strike. It is a bit hard to describe what it was all about. It started when the unions attempted to have defined the role of nursing and non-nursing staff and to get adequate staff numbers. It is certainly a pity that the matter developed into the sort of dispute that it did. It was dragged on even further by the actions of the Hospital Employees Federation of Australia. I think that the Royal Australian Nursing Federation had a great deal to say, and rightly so, about the claims that were being made, but it was certainly the patients who came off second best as a result of the dispute and as a result of the Government not taking steps to see that people were working and doing the job that they were supposed to be doing. In the end the Government's solution seemed to be to abolish the Capital Territory Health Commission overnight without giving any thought whatever to having an appropriate administration to take its place. A few days later some temporary authority was put in place and, hopefully, it is running the hospital system at present. One can hardly imagine why anyone would abolish the Health Commission without having thought through the arrangements which would be needed to be made by the authority which would take its place. As is well known, we have had problems in Canberra in relation to the care of the aged. I remind the Senate that in the election campaign in 1973 we were promised the establishment of the Office of Aged Care. We were again promised it in the recent election campaign and the Minister may tell us soon exactly when it will come into being. It is certainly an office which would be of interest to the Australian Capital Territory. A number of elderly people in the Australian Capital Territory-about 109-have been classified as being in need of nursing home care and are not able to obtain beds. For more than a year one bed at Morling Lodge has not been able to be occupied. I told the Senate the sorry story about that bed on a previous occasion. Because one more bed ended up in the place than the number for which it was licensed, it was not able to be used. At one stage when a patient was in it as a result of the Department's approving it, Morling Lodge was told to get the patient out of it. Senator Grimes —Now, now, that is not right and you know it. Senator REID —I think that if the Minister reads the correspondence he will find that it is. There are many areas in which people in the Australian Capital Territory have been unhappy about the way their health services have been affected. One area I would like looked into is the cost of providing health centres in relation to the services which they provide in a community which is well served by doctors; it is not an area where there is a shortage. I am not for a minute suggesting that we need to have more money spent in the area of health, but I would seriously question, as I did in the area I dealt with previously, whether money is being spent wisely and the best use is being made of it. We have had considerable union activity for the last couple of years. It seems that every time a union wants to have an argument about something the first thing it does is place some kind of a ban on Radford College one way or another. That sort of thing seems to bob up regularly. The newspaper headlines seem to recur: 'Work bans to hit schools'-that related to the development of the Belconnen college-'TLC told of threat by Government on schools'; 'BLF bans, roadway blocked by builders'; 'Parliament House site picketed'; 'Union bans housing concrete deliveries'; 'Unions row seen behind strike'. That related to a building site in Civic. There is another one 'Disputes threatening Australian Capital Territory milk supplies', but that referred to a dispute outside the Australian Capital Territory. Somehow people seem to think it is convenient to pick on those within the Australian Capital Territory in order to resolve their problems. The linen dispute has recurred from time to time. The one in relation to the Belconnen college development is interesting. The Teachers Federation and the Trades and Labour Council introduced bans because they did not like the site on which the college was to be built. There are other arguments in relation to whether the college was needed. There can be no doubt whatever that a shortage of places for years 11 and 12 is coming up in the near future. It seems there was argument between the National Capital Development Commission and the Australian Capital Territory Schools Authority as to whether the college was needed. The NCDC now seems to have agreed that it is, but it leaves the community with an uncertain feeling as to whether it is in Canberra's long term interest to expand the existing colleges so that in 10 years we will have viable colleges or to build another one now. The decision is to go ahead with the fourth college in that area, but banning the site because it was not liked by the Teachers Federation and the Trades and Labour Council displayed an unacceptable way to governing of this community and determining the way in which things will be done in the Australian Capital Territory. I cannot let this debate pass without mention of the fire-fighters union and its activities. A commissioner was appointed many months ago now and there has been dispute with the union ever since. Its members have refused to acknowledge this man as commissioner and there seems to be a stalemate. The union makes accusations that five of the fire trucks are really unsafe. I raised this matter yesterday in Question Time and got a most unsatisfactory answer from the Government. All I sought to do was to get an assurance for constituents in the Australian Capital Territory that if anyone needed a fire engine to come to a fire at his or her house the units which are provided are, in fact, in proper condition to do the job that they are supposed to do. I did not get such an assurance. Whatever disputes there may be between the Government and the fire-fighters, I hope that we can have an assurance from the Government that the units are serviceable. I have criticised the fact that the Government has delayed the appointment of a Chief Magistrate for over a year. The previous Chief Magistrate, Mr Hermes, resigned on 29 February 1984, having given considerable notice of his intention to do so. Still no Chief Magistrate has been appointed. The Chief Justice of the Supreme Court gave notice some weeks ago of his intention to resign this coming Friday, 29 March, and as yet there has been no announcement of an appointment of a replacement. At this stage I pay tribute to Sir Richard Blackburn and the contribution that he has made to the workings of the Supreme Court and to this community. He has been pro-Chancellor and now Chancellor of the Australian National University during the time that he has been in Canberra. He is a person for whom I have a special place in my heart because he was Dean of the Faculty of Law when I was a student in Adelaide some years ago. I do not know that that is something that he would boast about but certainly it is a relationship that has meant a lot to me over the years. I was very pleased indeed when he came to be appointed to the Australian Capital Territory Supreme Court and I certainly value the contribution that he has made. In the area of our schools there are a number of issues of concern. Suffice it to say that 23 or 24 per cent of students are in non-government schools and now we have a report that indicates that another 24 per cent of parents would prefer to have their children educated in non-government schools if they could. It is a pity indeed for our government school system that it is not providing what parents want and what they are entitled to. In the main we certainly have good school buildings in Canberra and I regret very much indeed the findings of this report which show that so many of the parents are unhappy with what is going on, especially in secondary schools. I will not go over again matters such as the postal service in Canberra, but certainly there have been comments about that on a number of occasions. I reiterate how poorly we were treated over the international sports facility grant. An amount of $1m was granted under the 1981 scheme which last year was withdrawn by the Minister for Sport, Recreation and Tourism (Mr John Brown) after the then Minister for Territories and Local Government had not advised him as to how the money should be spent. I am critical of the new scheme which gives us only $460,000. Under the previous scheme involving $25m, the Australian Capital Territory was to receive $1m; under the new scheme of $32m, we are getting only $460,000. It seems to me that we miss out both ways. I regret that things are going the way they are in the Australian Capital Territory. Senator Grimes —It is a real ghost town! Senator REID —I wish to raise a few matters and place them on record. I ask the Minister to have greater regard for the benefit of tourism in this year's Budget and not do as his predecessor did and tie down the Government's contribution and commitment to developing tourism, to diversifying this economy. Senator Grimes says that Canberra is a real ghost town and I know that he is being cynical. But I do not want this place to become merely a Public Service town. I want it to have an economy that is more diverse-as diverse as is possible. I want opportunities in this town for young people to have careers. I want them to be able to stay here in jobs other than just in the Public Service. Senator Grimes —Who brought Wang here? Senator REID —I think you did, alone and unaided! Senator Grimes —Yes, and who else? Senator REID —The Canberra Development Board was involved in bringing Wang here and Senator Grimes opened its office in Technology Park. There is a plaque to that effect and I was there to witness it. Senator Grimes —It was a good day, was it not? Senator REID —It was a good day. I am glad the Minister remembers it. I am glad that he thinks so fondly of Canberra. I ask the Minister to consider the benefits to young people and the future of this community in diversifying the economy and getting more companies like Wang into the area. I do not want to proceed in a way which will make Canberra more and more a Public Service town. The things I am talking about are not things on which vast sums of money need to be spent. I am not asking for additional moneys to be spent in Canberra. I want the moneys available to be spent wisely in the best interests of the community. I do not want the Budget figures to be exaggerated as they were last year. I do not want this year's Budget to give on the one hand and on the other take away during the year, as happened with the community housing expansion program. What about the small business assistance program which was to have received $300,000? Nothing has happened at all on that. I would suggest that of the moneys that go into the community employment program some could be diverted to boosting the funds of the Canberra Development Board because-and the Minister has just reminded us of this by raising the question of Wang Computer Pty Ltd; not that Wang received money from the Board-by creating businesses one can create jobs that are long lasting. Some jobs created through the community employment program are of value to those who get them but to a greater extent I suggest they are of benefit to the recipients of the money. I would like to see the money spent more in a way which creates capital and businesses so that there are real jobs with long term prospects available. I believe better use could be made of the $2m allocated for the community employment program when one considers how much the Canberra Development Board has been able to do with the jobs from the little it has received. Its jobs are created at the cost of about $6,700, spent in capital, and the cost under the community employment program was $11,500 for a 45-week job. I believe it has now dropped to about $10,000 but it is for a lesser period. These are some of the things that I hope the Government will address in the weeks and months ahead because they are matters that relate to the long term wellbeing of the Australian Capital Territory. Debate (on motion by Senator Grimes) adjourned. Motion (by Senator Grimes) proposed: That the Senate do now adjourn. Senator BOSWELL(Queensland)(10.21) —I wish tonight to address some problems being faced by elderly Queenslanders as a result of the assets test. The assets test is placing many country people at great disadvantage compared with other people in the community. It appears that the Government has given an assurance that it will not send valuers into homes or onto properties, but the Department of Social Security valuers have been way off the beam when valuing properties. The Department of Social Security values are absolutely ridiculous when compared with the valuations carried out by the Valuer-General. I give the Minister for Community Services (Senator Grimes) a couple of examples of valuations which have been carried out in the South Burnett district. The market value of 590 acres of uncleared land in fairly worthless country is approximately $30,500, the Queensland Valuer-General's value is $13,600 and the Department of Social Security has valued this piece of land at $365,000. I would be happy to give the Minister the property description, the rate notice and the name of the owner of this land after the debate if he is interested. I offer the Minister another example, of 213 acres of land with 20 acres under cultivation. The market value is approximately $21,000, the Queensland Valuer-General's value is $4,000 and the Department of Social Security valued the property at $225,000. Again I can give the Minister details of the property and the rate notice if he is interested. I am sure the Minister will agree that the Department's values are completely inaccurate. They are only a couple of examples but I can assure the Minister that hundreds of elderly people in rural areas are in the same boat; they all are worried about the loss of their pensions. Obviously the properties have been valued at Canberra real estate rates with no regard for the return that the properties can generate or their true market value. I ask the Minister whether he can give the Senate an assurance that the elderly people of rural Australia will receive a realistic valuation on their properties when they are being valued for the assets test. Clearly this is not being done at the moment, as these two examples show. Senator Grimes has only to ring some accountants in Queensland country towns to find a number of these examples. I would like the Minister to investigate urgently another problem. A Mr Petty of Mains Road, Sunnybank, purchased a block of land behind his home for $35,000 and spent $45,000 on building a home for mentally retarded adults. The $80,000 Mr Petty spent on that home and land is regarded as an asset. The home contains accommodation for six residents and two house parents. The Social Security Department has claimed that the house is an asset and Mr Petty has lost all his rights to a pension. He wishes to give the home to the Lutheran Church of Australia in trust but is worried that if he does so he will be seen as divesting his $80,000 asset to the church and that it will work against him. Mr Petty's act of charity in providing a home for six mentally retarded adults has rendered him ineligible for the pension. I ask the Minister to investigate urgently this travesty of justice and see whether he can rectify it so that Mr Petty gets the pension due to him. Senator Grimes —Is Mr Petty married? Senator BOSWELL —I will talk to the Minister after. Senator MISSEN(Victoria)(10.26) —I wish to address the Senate on a matter which has become very topical but which has been pending, unfortunately, for a long time. It relates to the dangers to the Great Barrier Reef arising from the risk of accidents. As honourable senators will know, an accident occurred only yesterday. I think there is still on the reef the bulk carrier TNT Alltrans. It is high and dry on the reef off Gladstone. I do not make this speech just because of that; I have had for some time material which has led me to believe that there was great danger from the present position concerning particularly the fact that it is not compulsory in areas of the reef to have a pilot. Many ships are travelling up and down the reef unpiloted. This has for some time constituted a danger which the pilots have been drawing to the attention of the authorities and the Government. Accidents such as the one I have mentioned are likely to recur. The reef is a great international feature and something for which Australia has responsibility as it is an item of world heritage. It is a most important feature of Australia. I intend in a couple of days to move a motion of which I have given the Senate notice in regard to certain other dangers to the reef and investigations which should be undertaken, but tonight I relate my remarks to the information I have received on the failure to have compulsory pilotage in this area. Pilotage is compulsory in most ports but outside those ports and in the very dangerous and intricate areas of the reef it is not necessary. Consequently many ships go there unpiloted. I have here a statement forwarded to me by Dr D. J. Grant, a spokesman for the pilots. It is a set of statistics and I seek leave to have it incorporated in Hansard. Leave granted. The document read as follows- 98 Kenmore Road,Kenmore, Queensland 4069 30th July, 1984 NAVSPOK MEMO 168. Gentlemen: Unpiloted Ship's Register-1983-1984 The following is a summary for this financial year. A more detailed report has been sent to the Secretaries and is also on file at Thursday Island. Unpiloted transits of Torres Strait, North East Channel and Inner Route 240 Piloted transits as per Joint Secretaries Annual Statistics 1,204 Total known transits 1,444 Percentage of known unpiloted transits 16.62% Out of all known foreign flag transits Percentage of known unpiloted transits 20.3 The 240 unpiloted transits break down according to flag: Panama, 57; Dutch, 28; U.S.S.R., 25; German, 22; Singapore, 21; Japan, 17; Liberia, 7; Korea, 4; Denmark, 4; Philippines, 3; British, 3; Greek, 3; Sweden, 2; Australia, 2; China, 1; Hong Kong, 1; Italy, 1; Fiji, 1; Israel, 1; Tonga, 1; India, 1; Vanuatu, 1; Papua New Guinea, 1; unidentified, 43. V.H.F. Communications- Calls answered 110 Calls not answered 96 Not called 34 From a total of 206 calls 46.6% were not answered. PREVIOUS YEARS Total Known Unanswered known unpiloted V.H.P. transits transits calls 1978-79 1,463 144 (9.8%) 79 (60.3%) 1979-80 1,499 77 (5.1%) 28 (42.4%) 1981-82 1,531 231 (15.1%) 58 (47.5%) 1982-83 1,362 225 (16.5%) 53 (48.2%) 1983-84 1,444 240 (16.6%) 96 (46.6%) (Continued) The percentage of known unpiloted transits appears to be averaging about 16% over the last three years. It is significant to note that Panama with the largest number of observed unpiloted ships is not a signatory to the I.M.O. Convention for the Standards of Training and Certification of Watchkeepers (S.T.C.W. Convention). At a Maritime Services Advisory Committee Meeting, August 1978, the Australian Chamber of Shipping signified inter alia their intention of strongly advising use of pilots in Torres Strait and the Inner Route, especially in ships with limited under keel clearance. This recommendation was promulgated at that time and more recently in November 1983, at the Parliamentary Works Committee hearing in Mackay, the Australian Chamber of Shipping stated their ongoing confirmation of this recommendation. With this in mind, recent observations of some unpiloted transits by vessels such as the Japanese Tanker ''Diana'' of 81,273 Tonnes and the Mobil Tanker ''Mobil Endurance'' and numerous loaded bulk carriers, for whom A.C.O.S. members are representatives, creates an enigma. Pilots have reported instances where some agents and owners who are prominently associated with the A.C.O.S. have actively influenced masters to proceed unpiloted and the service can only abhor this action. D. J. GRANT (Naval Spokesman) Senator MISSEN —I want to draw the attention of the Senate to two or three features of these statistics. In the period 1983-84 there was a total of 240 unpiloted transits of the north-east channel and the eastern route of the Torres Strait. According to the records of the joint secretaries of the pilot organisation, there were 1,204 piloted transits, so 16.62 per cent of all the journeys known-there may have been others-were unpiloted. In previous years, the degree of unpiloted vessels, as indicated in the document I had incorporated, is very similar. Senator Collard —This is from the Torres Strait Islands Service? Senator MISSEN —Yes, most of my information comes from the Queensland Coast and Torres Strait Pilot Service. Its records indicate that for VHF communications to ships 110 calls were answered, 96 calls were not answered and 34 were not called. From a total of 206 calls, 46.6 per cent were not answered-another serious concern of the pilots. I propose to summarise briefly the complaints made and give some extracts from letters which pilots have written to the Queensland Coast and Torres Strait Pilot Service in the last year. The complaints of the pilots fall into various categories. Many make predictions of accidents and show that near misses and dangerous situations have arisen during journeys when they have been piloting ships and have come close to unpiloted vessels. Many unsafe vessels travel on this route. Some of them are described in graphic terms in the letters written by the pilots as unsafe and lacking in equipment and adding to the danger they are being navigated in this way. In many places the passage is dangerous with many turns and variations of route, which again adds to the particular danger in this area. Another complaint is the greed displayed by many of the shipowners who persuade the masters very often not to take pilots, even though the reef ought to be piloted, and they contribute some moneys so they will not incur the costs of pilots. I propose to read from some of the extracts from these letters. I will not mention the names of the pilots, but the documents are available for the Minister to inspect. As they were making their complaints to the pilot service, I do not think I should mention the names of the particular pilots, only the dates and the occasions. Pilot A writes on 23 September 1984 about an occasion when he was piloting a vessel called the Marine Leo. He described the journey he took and then he said: I then observed the lights of a ship approaching Hammond Rock light from the West and showing a deep drafting signal. As it was apparent that the two ships would pass on the ''Turn'' at Turtle Head, I was able to reduce speed and pull away to the North. He later said: Whilst there was no danger of a collision at any time, the Mobil Endeavour proceeded, as I expected, in the middle of the White sector of Turtle Head lead light, and it would have been very difficult to pass him in this position. It was fortunate that we were able to slow down at such short notice and it did leave me in a rather awkward position as I had a five knot tide setting me down on Nardana Shoal. The second complaint of 22 March 1984 comes from a pilot who was piloting the Russian vessel, Stepan Artemenko. He referred to the fact that many Russian ships do not engage pilot assistance. He said: . . . any Russian master who considered that his knowledge of the Inner Route was sufficient for him to perform his own pilotage could undergo an examination conducted by his company. After passing the examination, the company accepts the master as being suitably qualified and, thereafter, pays him 10 per cent of the pilotage fee for every passage through the Inner Route. It would seem, that in effect, Russian ''shipping companies'' are issuing their own form of pilotage exemption certificate. Captain Grushevsky also informed me that there was a similar arrangement for passage of the Dardanelles and Bosphorus in Turkish waters where, apparently, pilotage is also on a non-compulsory basis. A third pilot complained to the navigational spokesman of the Pilot Service in a letter dated 30 August 1984. He referred to his misfortune to pilot MV Jasmine II, which he later described as 'a rust bucket'. The condition of the ship is another serious situation. He pointed out: ''Jasmine II'' was, in a phrase, a rust bucket looking for a place in which to have an accident and, it is probably superfluous to add, the proud flag of Panama fluttered from her stern. The glass in four of the nine wheelhouse windows had, at some time or other, been replaced by plastic sheets which had weathered to the extent of making them completely opaque. Forward visibility was, therefore, severely limited. Only one of two radar sets was operative. He went on to advise of other conditions of this ship and in his conclusion said: This ship was a prime example of the type with which every pilot is only too well acquainted. It is a sobering thought that such vessels, with all their shortcomings, could transit Barrier Reef waters without pilotage assistance. The existence of these ships makes a mockery of the STCW Convention and any other IMO recommendation. Many shipmasters have told me that most reputable maritime countries now have regulations whereby safety inspections are made of ships, particularly those under a flag of convenience, before a port clearance is issued. These checks cover officers' qualifications, charts and publications, navigational and engine room equipment, communications etc. It seems to be high time for Australia to follow this example. At present, it would appear that any ship, no matter how decrepit or how much of a potential hazard it represents, can enter or clear an Australian port without let or hindrance provided, of course, no specific complaint is lodged against it by one or more of the maritime unions. That is a graphic expression of what is obviously not just a single instance, but one of many. Another pilot wrote on 22 April of last year of a near collision with a container vessel. He was then piloting the Japanese bulk carrier, MS Ocean Monarch, south bound on 16 April between Bow and Heath reefs. He stated that he observed this vessel displaying lights approaching. After describing its movements he went on to say: Satisfying myself that vessel had not made a mistake in his alteration of course, I blew two blasts on the siren and altered appreciably to port as altering to starboard would have caused a collision and a possible grounding. We passed each other at about 1 1/2 cables distance at about 0633, observing in the dawn half light that the vessel was a USSR container vessel obviously unpiloted. This incident has all the ingredients for a collision caused through a late alteration of port blatantly contravening the International Collision Regulations, no sound signal . . . Yet another pilot made a complaint to the service, dated 30 October 1984. In this case he complained about the way in which some lines dispense with the service of a pilot. He stated: On two occasions the Master received a telex from K.Line advising that they wished him to proceed via Palm passage to Japan but without Pilot. He advised that he did require a pilot. Their very swift reply was to offer him $500US to proceed unassisted by a pilot. There is financial inducement for people to create further danger to the reef. Yet another pilot wrote on 24 June 1984-these complaints were all made in 1984-of the vessel MV Silver Star. He said: Our vessel, the M.V. ''Silver Star'' . . . was westbound through the P.O.W. At about 2330 on the 12/6/84 the lights of an eastbound vessel were observed and I attempted to contact her by VHF. This went unanswered, as did my further calls. By observation the approaching vessel was well north of the usual track to Goods Island and as it was apparent we would meet in the vicinity of Harrison Rock, I shaped to pass close north of the buoy, if required. At midnight when the vessels were one half a mile apart, the other ship came up on VHF. I told him my intentions and remonstrated on his failure to answer my earlier calls, to which the reply was . . . ''very sorry''. He also made no attempt to give me more sea room. He finally said: Whilst I had this situation under control, the conditions existed for a potentially dangerous situation. This was exacerbated by his refusal to answer my initial calls and again illustrates the need to stress on all Masters the importance of maintaining an efficient VHF watch in Reef waters. I turn to the expressions which have been made by the responsible organisations. Captain T. J. Grant, the navigational spokesman, writing to the secretaries of the Queensland Coast and Torres Strait Pilots Service, has a number of things to say in a letter of 13 February 1985, which of course was very recent. I will read just a few extracts from this letter. He said: The Service is primarily concerned with the safe navigation of vessels within the reef and the adoption of adequate measures to protect both the safety of navigation and the Barrier Reef itself. In November 1983, the Service lodged a submission regarding the Far Northern Section of the G.B.R.M.P., and the general views expressed therein remain unaltered. Since that time, the Australian Government's Department of Transport has prepared draft submissions for I.M.O. recommended pilotage in certain areas of reef waters. It is believed that an approach is to be made to I.M.O. in 1985. He then refers to Hydrographer's Passage, which I will refer to later, and to the fact that investigations are going on to determine the risk analysis of various areas. He refers to a number of the areas under the headings 'High Risk areas' and 'Medium Risk areas'. There are quite a number of them in both categories. In regard to Hydrographer's Passage, which of course is a fairly new passage opened up for shipping, he states: No notations were made on the appropriate B.A. Chart, because the detail of the chart was considerably in error, and at that time, the Australian Chart Aus. 821 had not been published. Det Norske Veritas were also in the process of compiling a risk analysis of the passage. * * * Using similar parameters to those used in marking up the other charts for the inner route; Hydrographer's Passage would be a High Risk area from the pilot ground off Blossom Bank to the Southern extremity of Bugatti Reef, and a medium risk area from there to the Western edge of Stephens and Cole Reefs. He then makes a general comment on the non-use of pilots by some vessels. He states: The reasons for non-use of pilots by some vessels are varied and complex. A large percentage of ships are not operated directly by their owners. They are frequently time chartered then subchartered for either a single voyage, several voyages or a fixed time. Whilst on charter, pilotage costs are usually to charterers account, and in the case of non-compulsory pilotage, there is frequent disputation on who will pay for pilotage; also the need for a pilot to be engaged. One sees from these things that there is an economic reason why these risks are taken. He continues: This situation in turn, leads to considerable pressure on ships masters to proceed unpiloted. The rationale behind this is that a master may lose his employment, if he insists on engaging a non-compulsory pilot. It is also a well known practice for some owners or charterers to offer some financial reward to a master to proceed unpiloted in non-compulsory areas. I have already given one example of that. He then speaks of a conference which he had with Japanese owners in Sydney in September 1984: The Japanese in recent years have declared compulsory pilotage zones in a number of areas of Japanese waters, apart from ports, such as Tokyo Bay, Kobe and Osaka Bay, Ise Wan and the Inland Sea. The Japanese shipping company representatives expressed the view that declared compulsory pilotage zones removed any doubt about the need for engaging a pilot, also who was responsible for payment, and finally any pressure on masters to proceed unpiloted. I emphasise those statements. I believe that the Japanese are acting soundly here and we and our Government are acting unsoundly in not taking the same forthright attitude in Australia. I have seen the minutes of the meeting which was held by the pilots organisation with the Japanese on 6 September last year. In the discussions about compulsory pilotage this is said: The Japanese representatives suggested that a declaration of compulsory pilotage could well remove any doubt about proceeding unpiloted and further remove any possibility of masters being subject to influence to proceed unpiloted. It appears that the Japanese did not place great concern on the legalities of this subject but more on the point that if pilotage was really considered essential then it should also be compulsory. That is also the view of the pilots. Ideas on this subject have also been expressed by the Great Barrier Reef Marine Park Authority, which is very concerned at the danger of exposure of the reef-not only of the blockage of the reef and passage through it, but also dangers of spillage of deleterious substances which go up and down with the tides and could destroy great quantities of the reef. Mr Graeme Kelleher, Chairman of the Marine Park Authority, had this to say when writing to Mr N. R. Rogers of the Queensland Coast and Torres Strait Pilots Service on 15 August 1984: As you are aware your concern regarding the potential hazard caused by unpiloted vessels in the Great Barrier Reef waters is widely shared. I understand that you have been involved in the development by the Department of Transport of the proposal to go to IMO regarding a recommendation on pilotage in Torres Strait and the Great Barrier Reef. It appears that the recommendation if adopted by IMO would provide an increased level of navigational security in the Great Barrier Reef waters. It would cover the majority of cargo vessels and should cover cargoes which might be hazardous if spilled. A measure of risk would remain from unpiloted vessels which would by definition be generally small and carrying non-hazardous cargoes. The remaining risk would attach largely to the risk of collision between a piloted vessel and an unpiloted vessel and that risk exists in any event with the small craft such as fishing and tourist charter vessels which are working in the region. There is a clear support and concern by the Great Barrier Reef Marine Park Authority in this matter. The whole matter has been discussed by a committee of this Parliament. Indeed, the eleventh report of 1983 by the Parliamentary Standing Committee on Public Works was related to the provision of navigational aids for the newly opened Hydrographer's Passage. The Committee was very firm. Paragraph 68 of the report states: Compulsory pilotage presently exists in Australian ports-for the protection of the port facilities as much as to protect the ships concerned. There is a similarity between the protection of port facilities and Hydrographers Passage, because in this instance the aim is to protect the Great Barrier Reef, rather than the ships concerned. The Committee was concerned in that report with the Hydrographer's Passage and not with the overall situation. Paragraph 69 states: A precedent exists in the international scene for compulsory pilotage. Canada has declared its Arctic waters to the north as a compulsory pilotage zone. Although evidence was given that the international shipping community was not supportive of this unilateral declaration, there have been no legal challenges to its validity. The Committee then reported on the 1958 Convention on the High Seas and the fact that, if that were applicable, the Great Barrier Reef could be declared a special area. It deserves special protection measures. Paragraph 72 states: The Committee therefore favours a system of compulsory pilotage in Hydrographers Passage, with a system of exemptions, on examination, for suitably experienced masters. That certainly has been considered and recommended by the Committee of this Parliament in the instance of a new passage being set up. If this country has not yet adopted the United Nations Convention on the law of the sea, in which there is provision for special areas to be determined, that should have been done by now. In conclusion, I want briefly to mention that there has been correspondence between the Queensland Coast and Torres Strait Pilots Service and the Minister for Transport (Mr Peter Morris). In a detailed letter written by the Pilots Service on 25 October 1984 the Pilots Service referred, among other things, to the report I have just read and indicated its support for it. It stated: The report further indicated that if the matter is not resolved by the time the navigational aids are completed, the Committee would recommend that the Australian Government consider making a unilateral declaration for compulsory pilotage, subject to a favourable opinion being received from the Attorney-General's Department on the legality of such a course of action . . . It refers to Canada's unilateral declaration of its Arctic areas and states: This Service suggests that before an approach to I.M.O. is initiated-- that is for a declaration which is not binding- it would be helpful if the Australian Government were to declare an unqualified recommendation on the use of pilots within their licensed area. This would add strength to the I.M.O. submission. I will not read all the details of that letter. In reply the Minister says various things. I find his reply to be very unsatisfactory indeed. The Minister, in his reply to Mr Rogers on behalf of the Pilots Service on 28 November 1984, wrote: The Government's commitment to the protection of the Reef is unequivocal. He then speaks about navigational aids having been provided and a risk analysis study having been commissioned. He says that the Government is also seeking an International Maritime Organisation resolution recommending pilotage and the continuation of the previous Government's policies in zoning the Great Barrier Reef. He then refers to the Public Works Committee report concerning Hydrographers Passage. He then says: Advice received from the Attorney-General's and Foreign Affairs Departments confirmed my Department's view that there was no provision for compulsory pilotage on the High Seas in the 1958 Geneva Convention and that the unilateral imposition of such a measure would be regarded most unfavourably by other governments. Australian Government policy remains committed to the observance of international law and to refraining from unilateral actions which would interfere with the long established principle of freedom of the High Seas. It is also recognised that to do otherwise would lower Australia's standing in international forums and invite retaliatory measures which could harm Australian interests. One must remember what has been done by Canada and Japan, which have areas which they gravely need to protect. The Minister's response is very weak indeed. The Minister continues: The United Nations Convention on the Law of the Sea, which has not yet been ratified, does open up the possibility that compulsory pilotage in special areas may eventually receive favourable consideration at IMO. One asks why that has not proceeded, why we have not acted with urgency in respect of that. The Minister goes on to say: Your suggestion that an unqualified recommendation on the use of pilots would assist Australia's proposal at IMO is noted. However, such a move could be interpreted by some countries as an attempt to pre-empt discussions on the issue and might prove counter-productive. I put it that the Minister's response is disgracefully inadequate. The fear of upsetting one or two countries is not an adequate answer to this problem. I put it that the example we have had now of a collision has responded to all the fears which have been expressed for years by the pilots, by the Marine Park Authority and by other citizens and has shown that the Government's policy is a most unwise policy. I ask the Minister and the Government to be at least wise after the event and to introduce a unilateral declaration so that there is compulsory pilotage in order that we in this country are able to protect to the greatest possible degree the absolutely irreplaceable benefits and values of the Great Barrier Reef which are obviously now under risk and challenge. Senator TOWNLEY(Tasmania)(10.53) —I take time tonight to bring to the notice of the Senate a news bulletin that was brought to my notice earlier today about the setting up in this country of an office of the South West African People's Organisation, which occurred today. I will read some of the Australian Associated Press bulletin. It states: Two senior SWAPO officials arrived today to set-up office in Australia, seeking finance and the Hawke Government's condemnation of the South African regime. Their arrival follows the decision last October to allow the South West African People's Organisation to have information offices in the country, a decision they say acknowledges that Namibia (South West Africa) is unjustly occupied by South African forces. Hadino Hishongwa, 41, will be SWAPO's chief representative for Australia and the Pacific. He has represented South West Africa since 1969 in Zambia, Senegal, Sweden and Angola. With him is Peter Mueshihange, SWAPO's foreign affairs secretary. Mr Mueshihange will not be staying in Australia. They said monetary aid collected in Australia would be used to feed, clothe and educate Namibians in their homeland and refugees in neighbouring countries and would not be used to arm SWAPO fighters. Arms used by their forces were paid for by the Liberation Committee of the Organisation for African Unity, they said. They wanted Australian businessmen to sever links with South Africa and the Government to condemn the apartheid regime. Although the United Nations and many individual nations had often voiced their disapproval, Mr Mueshihange said he felt Australia's voice would make a difference. I think the pressure is almost breaking through. The white people in South Africa are getting tired. I take those words to be the words of Hadino Hishongwa, although they are not enclosed in inverted commas. The bulletin continues: 'I think the parents are fed-up. They don't see why their sons should be recruited and sent to the battlefields-they don't come back, they are dying out there. I think they will put pressure on their own Government'. However both men said a major blood-bath was probable and pointed to the recent killings on the 25th anniversary of the Sharpeville massacre. 'The blood-bath is going on now but the thing about it is it is one-sided, it is the black people's blood,' Mr Mueshihange said. 'I don't know how you react to a regime like that (apartheid). Peace doesn't work. If you are oppressed you have to resist. 'Once you have been bitten you have to reply in any way you can. It says in the Bible if you are bitten on the cheek, you turn the other side. I don't think this is right. Your body is supposed to be your temple and should be respected by other human beings,' he said. 'Perhaps now it will spill the other way,' Mr Mueshihange said. The bulletin goes on for a little longer but it does not need to be quoted because it does not have any relationship to what is said. I think it is disgraceful and a sad day for Australia when a situation such as this arises in this country. I want to know who is to be asked for money. Is the Hawke Government going to give money voluntarily to this self-professed terrorist organisation which is collecting finance in this country? To me it seems quite remarkable this situation has been allowed to occur. I was very much against SWAPO being allowed to enter Australia. Now it is coming in, not to give information but to collect money, which it says-can one trust a terrorist-it is not going to use for arms. On whose say-so? I for one do not believe it. This Government should immediately say that any money collected by that group will not be allowed out of Australia. Too much Australian money goes overseas for one purpose or another. When it goes overseas to finance terrorist organisations, I think we are becoming embroiled in a situation every right-thinking Australian should be downright ashamed of. It is quite obvious that this Government is becoming more extreme than that of Mr Whitlam. I would not be surprised if, one way or another, this Government got finance to this group so it could send it over to Africa for whatever use it decided. I believe that if it collects any money we will, in one way or another, be helping to finance the arming of this group. I repeat: We should never have allowed this self-professed terrorist organisation into this country. It is quite ridiculous not to let in a supporting team but to let in terrorists. I cannot see any justification whatsoever for the action this Government is taking Senator GRIMES(Tasmania-Minister for Community Services)(10.59) —in reply-It has been a long night. I was very interested in the long speech by Senator Missen. I certainly would be a bit worried about travelling down the Great Barrier Reef if all the things that he has said tonight are true. I will refer all those matters to the Minister for Transport (Mr Peter Morris) for further attention. I take seriously the matters raised by Senator Boswell. I will certainly refer them to the Minister for Social Security (Mr Howe). However, I shall make a couple of comments on them. The figures Senator Boswell presented tonight are quite fascinating. He tells us of a situation of someone who has 590 acres of land in Queensland with a market value of only $30,500. That is a bit contrary to the sort of nonsense we get from the Queensland representatives in this place. I do not know of any 590 acres of land in Tasmania that would be worth only $30,500. The valuation of that land by the Valuer-General is only $13,600 yet the Department of Social Security values it at $365,000. Quite obviously, there are considerable differences there. I will certainly ask the Minister for Social Security to look into that. We also heard of the 213 acres of land worth, on market values, $21,000. The Valuer-General values it at only $4,000-again, extraordinary values in Queensland-yet the Department of Social Security values it at $225,000. That is obviously worth looking at. I remind Senator Boswell of what I said today. We have an assets test to which he objects strongly. He believes that people who have land worth $365,000 or $225,000, even in real value, should still be able to get the full pension and fringe benefits whereas his colleagues in Queensland say that people who have assets worth more than $5,000 should not receive home care or domiciliary care. I ask him some time, perhaps on the adjournment-but, please, not tonight-to explain those differences. I find Senator Townley's speech extraordinary. Senator Townley is well known in this Parliament as an apologist for the South African Government. In fact I remember meeting Senator Townley on three occasions when he was swanning around representatives of the South African Government in this country. He will apologise for the actions of the South African Government at any time. In fact he has been to South Africa and had his fare paid by the South African Government. He has had his fare and his living expenses in South Africa paid by the South African Government. It is extraordinary that, on the twenty-fifth anniversary, as he said, of the Sharpeville massacre-two days after there has been another massacre in South Africa; a massacre of black people who were shot down-he gets up in this Parliament and says that the representatives of those black people should not be heard, that the words that they wish to speak on behalf of their own people should not be heard in this country. He has the gall to get up to suggest that what this Government is doing is in some surreptitious way passing money to terrorist organisations for their use. Senator Townley is the great supporter of the South African Government. He is a great supporter of South African business in this country which takes its money back to South Africa and uses it to suppress the great majority population of that country. I have met Senator Townley in streets in Tasmania where he has been swanning around representatives of the South African Government who take him to South Africa and do what is known in this country as duchess him-look after him very well. He comes back here and is second only to Senator Sheil in supporting the apartheid regime in South Africa. A couple of days after there has been a terrible slaughter of black people in South Africa, almost on the anniversary of the Sharpeville massacre-even the American Secretary of State Mr Shultz condemns the apartheid regime in South Africa-Senator Townley decides to speak. Alone in this Parliament Senator Townley says: 'The South Africans are perfectly right in suppressing their black majority'. According to Senator Townley, we should not even allow into this country an organisation which wishes to speak for black majority rule. I think Senator Townley should remember that he is a senator for Tasmania and not for South Africa. He should remember that if he takes his trips to South Africa, swans around that country and is treated there in a way that no black citizen of that country would be treated, he does not have the right to come in here and go on in the way he did tonight. If he does it again I will again get up and condemn him. I will not refer Senator Townley's remarks to the Minister for Foreign Affairs (Mr Hayden). If the Minister for Foreign Affairs wishes to read those remarks and read the scurrilous nonsense that Senator Townley went on with tonight about the actions of this Government he can, but I will not take the trouble to refer them to him. I make it perfectly clear that that is so. I have heard Senator Townley go on in this way in the past. I dare say that now Senator Sheil is back he will do the same thing. I do not think that this chamber, at any time of the day let alone at this time of the night, should have to put up with such rubbish. As I said last night, I think we all should go home to bed. Senator Townley —Mr President,- Senator Grimes —Mr President, Senator Townley has spoken already. The PRESIDENT —Yes, I know. Senator Townley, are you seeking leave to speak? Senator Townley —I seek leave to make a brief statement. Leave not granted. Senator Townley —Mr President, on a point of order, I suggest to the Minister for Community Services that I wish to make only a very brief statement. It might save a lot of time in this place on future days if leave were granted. Senator Grimes —No. The PRESIDENT —Leave has been sought by Senator Townley to make a statement and leave has been refused. Therefore, I have to put the question that the Senate do now adjourn. Question resolved in the affirmative. Senate adjourned at 11.07 p.m. The following papers were tabled: Fisheries Act-Fisheries Notice 1985 No. 138-Minimum Mesh Sizes for Certain Trawl-nets. Quarantine Act-Determination-Notice under Section 86E, dated 22 March 1985. The following answers to questions were circulated: (Question No. 2) Senator Bolkus asked the Minister representing the Minister for Science, upon notice, on 22 February 1985: (1) What proportion of the 50 post-doctoral research fellowships announced by the Minister for Science and Technology on 24 October 1984 were awarded to women. (2) What proportion of the applications for such fellowships were made by women scholars. Senator Button —The Minister for Science has provided the following answer to the honourable senator's question: Applicants for National Research Fellowships are not required to state their sex. Based on the information available: (1) 4 per cent. (2) 9 per cent. (Question No. 48) Senator Puplick asked the Minister representing the Minister for Science, upon notice, on 28 February 1985: (1) Did the Report of the Organisation for Economic Co-operation and Development (OECD) Examiners, who recently visited Australia to examine science and technology matters, recommend, inter alia: (a) 'increased support for university research'; (b) 'a sustained effort to improve the quality of university equipment'; and (c) that 'support for basic research under the ARGS should be increased'. (2) Has the Australian Research Grants Scheme (ARGS) Committee, in each of its last two annual reports, complained to the Government about the reduction in funds made available to the Committee and the fact that such reductions in funds have left many worthy research projects unfunded. (3) Did the ARGS Committee Report on Grants Approved for 1985 specifically draw attention to the fact that 'the level of funding for research is not sufficient to allow the ARGS to provide adequate equipment to outstanding researchers', and that much of the major equipment available in universities is 'either obsolete or rapidly approaching the end of its effective life and is thus impeding the progress of high quality research'. (4) What does the government propose to do to overcome the glaring failure of its own policies in research support funding which has been exposed by the ARGS Committee and the independent analysis of the OECD Examiners. Senator Button —The Minister for Science has provided the following answer to the honourable senator's question: (1) The report referred to is a draft report prepared by the OECD Examiners and released in January 1985. The final report of the Examiners will be released following the forthcoming Review Meeting between the OECD Examiners and Commonwealth and State Ministers in early April. In answer to the Senator's specific questions: (a) Yes. (b) Yes. (c) Yes. (2) There has been no reduction in funds to support the ARGS. In its report on grants approved for 1984 the Committee 'welcomed the increase in funding' (17 per cent in dollar terms from the previous year), but considered that the funds available were appreciably less than the amount required to maintain an adequate level of activity. In 1985 the Committee acknowledged that funds had increased by 6.5 per cent in dollar terms from the previous year but was dissatisfied with the level of funding because of its inability to support many worthy projects. (3) Yes. (4) The comments made by the ARGS Committee and in the draft OECD Examiners' Report relate to support for university research and non-directed basic research supported by the ARGS. Support for university research comes from a wide range of sources apart from the ARGS, including a number of mission-oriented schemes. Total identifiable research expenditure in universities has increased significantly since 1977 in real terms. During this period, there was a growing contribution in mission-oriented areas such as medicine, energy and marine science. Both the current government and the previous government have in recent years given priority in research funding to mission-oriented and tactical research. The Government recognises the importance of non-directed basic research (such as ARGS), and will take into account the comments made by the ARGS Committee and the OECD Examiners in framing this year's Budget.