Wednesday, 22 May 1985 The PRESIDENT (Senator the Hon. Douglas McClelland) took the chair at 10 a.m., and read prayers. The Clerk-Petitions have been lodged for presentation as follows: Defence Security To the Honourable the President and members of the Senate in Parliament. The undersigned are convinced that an alliance, including full military co-operation, between Australia and the United States is indispensible to the defence security of the Australian Commonwealth; that every alliance involves co-operative arrangements of a practical nature; and that the following arrangements are indispensible to the effective conduct of A.N.Z.U.S. and any similar agreement, to wit; the reception of U.S. naval shipping (nuclear and non-nuclear) in Australian ports; the maintenance of the present U.S. installations in Australia; reasonable co-operation by Australia in U.S. missile testing programs. Your petitioners, therefore, pray the Senate, in Parliament assembled, that you will give this matter your earnest consideration. And your petitioners as in duty bound will ever pray. by Senator Reid (from 19 citizens). To the Honourable the President and members of the Senate assembled. The petition of the undersigned respectfully shows that: We, the undersigned electors, are deeply concerned at the possibility of an increase in indirect taxation currently being considered by the government. To pose a broadly based consumption tax would mean a proportionately greater burden on low income groups and worsen their already precarious and impoverished position. Women who are supporting mothers, together with their children, are acknowledged as the largest single group forced to exist below the poverty line. As beneficiaries of an already inadequate government pension, their futures would be even more jeopardised if there were to be a change towards increased broadly based consumption taxation. Your petitioners therefore pray that the Federal Government not adopt the proposed shift towards increased indirect taxation. And your petitioners as in duty bound will ever pray. by Senator Zakharov (from 47 citizens). 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 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 Senator Kilgariff (from 42 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth: That we the undersigned, who have great concern for the protection of the unborn child, call upon the Government to reject the Vinson Enquiry recommendation that an Abortion Clinic be established in Canberra. And your petitioners most humbly pray that the Senate in Parliament assembled will reject this recommendation. by Senator Reid (from 407 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth: That we strongly oppose the 'A.C.T. Smoking and Tobacco Products Advertisements Prohibition Bill' introduced by Senator Jack Evans, because it will adversely affect sporting organisations and small businesses in the A.C.T., it reverses the onus of proof, and represents an unnecessary intrusion by Government into the private affairs of individuals and other groups. Your petitioners most humbly pray that the Senate, in Parliament assembled, should reject this Bill. And your petitioners as in duty bound will ever pray. by Senator Reid (from 114 citizens). To the Honourable President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully shows: That we strongly support 'The A.C.T. Smoking and Tobacco Products Advertisements Prohibition Bill' introduced by Senator Evans, because it represents the first positive national step towards the eventual elimination of wide-spread serious ill health caused by smoking tobacco. And your petitioners as in duty bound will ever pray. by Senator Jack Evans (from 90 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth: Introduction of any additional capital gains taxes, wealth taxes of death duties is opposed on the grounds that: They adversely affect the small and medium size businesses in Australia, destroying incentive and discouraging investment in this important area of the economy; The Australian economy, and employment in particular, is heavily reliant on growth in small businesses; Any capital gains that might result when owners of small businesses finally sell the business are not ''windfall gains'' but the result of many hard years of work and sacrifice, with very little being taken out of the business by way of salaries so that the maximum amount of money can be ploughed back into the business to create growth and jobs; The owners of small businesses often depend on a capital gain-which are simply deferred salaries-when they eventually sell their business to sustain them in retirement; Your petitioners request that the Senate, in Parliament assembled, will protect the rights of private enterprise and reject any inequitable additional taxes. And your petitioners as in duty bound will ever pray. by Senator Brownhill (from 861 citizens). Petitions received. Senator JACK EVANS(Western Australia) —I give notice that, on the next day of sitting, I shall move: (1) That a select committee, to be known as the Select Committee on Public Servants' Rights in relation to Exposing Breaches of the Law, be appointed to inquire into and report upon- (a) injustices suffered by public servants who seek to expose actions detrimental to Australia's interests; (b) public servants being prevented by departmental heads from exposing blatant evasions of the law; (c) threats to the 'national interest' in such circumstances; and (d) public servants being threatened with prosecution on the basis of breaching the oath of confidentiality in such circumstances, and to recommend such legislative and administrative measures which it considers desirable to improve public servants' rights in the circumstances outlined. (2) That the Committee consist of six Senators, as follows- (a) three to be nominated by the Leader of the Government in the Senate; (b) two to be nominated by the Leader of the Opposition in the Senate; and (c) one to be nominated by the Leader of the Australian Democrats after consultation with any minority group or groups of Senators or Independent Senator or Independent Senators. (3) That the Committee proceed to the despatch of business notwithstanding that all members have not been duly nominated and appointed and notwithstanding any vacancy. (4) That the Committee elect as Chairman one of the members nominated by the Leader of the Government. (5) That the Chairman of the Committee may, from time to time, appoint another member of the Committee to be the Deputy-Chairman of the Committee, and that the member so appointed act as Chairman of the Committee at any time when there is no Chairman or the Chairman is not present at a meeting of the Committee (6) That, in the event of an equality of voting, the Chairman, or the Deputy-Chairman when acting as Chairman, have a casting vote. (7) That the quorum of the Committee be three members. (8) That the Committee (and any sub-committee) have power to send for and examine persons, papers and records, to move from place to place, to sit in public or in private, notwithstanding any prorogation of the Parliament or dissolution of the House of Representatives, and have leave to report from time to time its proceedings and the evidence taken and such interim recommendations it may deem fit. (9) That the Committee have power to appoint sub-committees consisting of three or more of its members, and to refer to any such sub-committee any of the matters which the Committee is empowered to consider, and that the quorum of a sub-committee be a majority of the Senators appointed to the sub-committee. (10) That the Committee be provided with all necessary staff, facilities and resources and be empowered to appoint persons with specialist knowledge for the purposes of the Committee with the approval of the President. (11) That the Committee be empowered to print from day to day such papers and evidence as may be ordered by it, and a daily Hansard be published of such proceedings as take place in public. (12) That the Committee report to the Senate by 30th June 1986. (13) That, if the Senate be not sitting when the Committee has completed its report, the Committee may provide the report to the President, or, if the President is unable to act, to the Deputy President, and, in that event (a) the report shall be deemed to have been presented to the Senate; (b) the publication of the report is authorized by this Resolution; (c) the President or the Deputy President, as the case may be, may give directions for the printing and circulation of the report; and (d) the President or the Deputy President, as the case may be, shall lay the report upon the Table at the next sitting of the Senate. (14) That the foregoing provisions of this Resolution, so far as they are inconsistent with the Standing Orders, have effect notwithstanding anything contained in the Standing Orders. Senator MacGIBBON(Queensland) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) deplores the fact the Labor Government failed to maintain a quorum in the Senate on 21 May 1985, that only 3 Labor Senators out of the 35 elected by the people of Australia were present in the chamber to answer the call for a quorum, and that as a consequence the Senate had to be closed down before the business of the day was completed; (b) noting that since the action to call a quorum was initiated by a Labor Senator and that such an action was an act of stupidity, at best, because he exposed the negligence of his colleagues towards the solemn discharge of their duties and responsibilities in the Senate to the legislative process of Australia, and at worst was an act of contempt for the democratic legislative processes of the Australian Parliament, in so far as it denied the Opposition the occasion to debate the matters of importance before the Chair; and (c) noting that this is only the second occasion since 1933 that such an irresponsible event has occurred, calls on the Government to resign, as it has demonstrated its incapacity to govern and respectfully requests the Governor-General to commission a new government for the people of Australia. The PRESIDENT —Order! I have listened carefully to the notice of motion of Senator MacGibbon. Before authorising its inclusion in the notices of motion I will consider whether it may or may not be entirely in order in that it may reflect on the proceedings of the Senate. Senator TOWNLEY(Tasmania) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) recognising that the present Hawke socialist Government is a very big spending government; (b) aware that big spending and big taxes must go hand-in-hand if Australia is to avoid getting even further in debt to overseas banking organisations; (c) convinced that Australia is already too far in debt for the good of future generations; (d) further aware that Australia will spend more on its national debt interest than on defence in the next financial year; and (e) recognising that to stop the escalation of our horrendous national debt interest the Government will soon be forced to make drastic expenditure cuts and/or introduce massive tax increases no matter what is said at the tax summit, calls on the Government to issue a statement explaining to the people of Australia how it intends to solve the national debt interest crisis situation. Senator CHIPP(Victoria-Leader of the Australian Democrats) —I give notice that, contingent on Senator Walsh, in the course of proceedings of the Senate, concluding any speech, statement, answer to a question or comment, I shall move: That so much of the Standing Orders be suspended as would prevent the leader of the Australian Democrats (Senator Chipp) moving a motion of censure of Senator Walsh. Senator JESSOP(South Australia) —I give notice that, on the next day of sitting, I shall, move: That the Senate deplores the action of the Government on Tuesday, 21 May 1985, in- (1) calling a quorum on the adjournment debate; (2) failing to keep the constitutional numbers in the Senate; and (3) stifling the opportunity for Opposition senators to condemn the bullying tactics of the Prime Minister with respect to the pending visit to South Africa by Australian professional cricketers. Senator TOWNLEY(Tasmania) —I give notice that, on the next day of sitting, I shall move: That the Senate is appalled that there were only 3 Government Senators in the Senate, about one-eighth of a quorum, when the Senate was counted-out due to lack of numbers on the night of Tuesday, 21 May 1985. Senator GRIMES(Tasmania-Manager of Government Business) —I table papers in accordance with the list circulated to honourable senators. I seek the concurrence of the Senate to incorporate the list in Hansard. Leave granted. The list read as follows- 1. The Australian Sports Commission and the Office of the Status of Women-Report by the working group on Women in Sport. 2. Queensland electricity supply and related industrial legislation-Report by the Human Rights Commission-Pursuant to section 9 (1) (c) of the Human Rights Commission Act 1981. 3. Relationship between the Ombudsman and the Administrative Appeals Tribunal-Report by the Administrative Review Council. 4. Human Rights and the Migration Act 1958-Report by the Human Rights Commission-Pursuant to section 9 (1) (a) of the Human Rights Commission Act 1981. 5. Joint Select Committee on Electoral Reform-Government response to the committee report. 6. Special assistance for the Northern Territory-Report by the Commonwealth Grants Commission-Pursuant to section 25 of the Commonwealth Grants Commission Act 1973. 7. Royal Australian Air Force Veterans' Residences Trust-Annual Report 1983-84-Pursuant to sections 10 (3) and 10A (2) of the Royal Australian Air Force Veterans' Residences Act 1953. 8. Report on the operation of the Student Assistance Act in 1984. Pursuant to section 35 of the Students Assistance Act 1973. The PRESIDENT —I draw the attention of honourable senators to the presence in the Presidential Gallery of former Senator Ian Wood, who served the State of Queensland in the Senate for a period of some 29 years. On behalf of all honourable senators I extend to Mr Wood a warm and friendly welcome upon his return to Canberra. Honourable senators-Hear, hear! Motion (by Senator Mason) agreed to: That leave be given to introduce a Bill for an Act to prohibit the dumping or disposal of radioactive wastes or other radioactive matter into the sea. Bill presented by Senator Mason, and read a first time. Senator MASON(New South Wales)(10.09) —by leave-I move: That the Bill be now read a second time. I seek leave to incorporate the second reading speech in Hansard. Leave granted. The speech read as follows- The purpose of this Bill is to prohibit the dumping or incineration at sea of any radioactive wastes or other radioactive matter, and the loading of any radioactive wastes or other radioactive matter for the purpose of being dumped at sea or incinerated at sea. The Bill applies to Australian waters, the sea above the Continental Shelf of Australia and the waters of external territories. At present, under the Environment Protection (Sea Dumping) Act of 1981, Section 22 allows the Minister to grant a permit for the loading or dumping of such radioactive wastes off the Australian coast. In June 1981, during debate on the Principal Bill, the Labor Shadow Minister for the Environment moved an amendment to clause 22 which, if it had been passed, would have prohibited the dumping of radioactive wastes under any circumstances. This Bill seeks to do just that, and it also incorporates almost word for word the amendment moved by the then opposition. In introducing this Bill, the Australian Democrats are mindful of a number of facts, including the fact that the World's Scientific and Industrial Community has not as yet developed safe, sure methods of disposing of radioactive wastes. This is many decades after the birth of the Nuclear Industry. We are also aware that, according to our research into United Nations Educational Scientific and Cultural Organisation Dissertations, the behaviour of any radioactive isotope in the marine environment probably will be different at different locations, that the effect of radiation on living organisms is cumulative, and that, unlike other forms of contamination, the effects of radioactivity become more pronounced with time. We all know that the half life of plutonium, for example, is some 24,400 years, so we may expect contamination to continue for literally millenia. Even with low rates of radiation there is an increase in the rate of mutation of genes and, as each individual in the sea, as elsewhere, is after all a highly complex and integrated machine, any mutation is likely to be harmful rather than beneficial. That is basic to any genetic consideration. Further, coastal waters are the most productive areas of our oceans, having the highest biological activity, and where primary production of the organic material which forms the base of the food chain ending in fish, birds and marine mammals takes place. The United Nations educational scientific and cultural organisation agrees that the greatest danger of harmful effects from any radioactive pollution of the oceans would be in coastal waters, including the waters over the continental shelf. Looking regionally, we see that all nations comprising the South Pacific Forum, including Australia, have opposed the dumping of radioactive waste in the ocean. The people of the small Pacific nations face the greatest threat, for it is in the vast areas of the Pacific Ocean that some larger, nuclear nations, are looking to dispose of their poisonous radioactive wastes. This threatens the very life and livelihood of the people whose world is the thousands of islands of the Pacific, for if their waters and their food are poisoned, the Pacific people are poisoned. The London Dumping Convention, an international treaty concerned with the dumping of radioactive waste and signed and/or ratified by over 50 countries, including Australia, announced in 1983 a two-year moratorium on the dumping of radioactive wastes in the ocean. While this moratorium is not binding on parties to the convention, it appears that the moratorium combined with public pressure have forced most, if not all, parties to suspend ocean dumping at least until a scientific study has been completed and discussed at the next London Dumping Convention to be held in September 1985. However, while this is somewhat reassuring, there is strong and continuing international pressure seeking the allowance of the ocean dumping of radioactive wastes. While some of the waste involved relates to low level radioactive waste, there are also plans to load high level radioactive wastes into torpedoes which would penetrate deeply beneath the sea bed. Seven nations, including Britain, France, Japan and the United States comprise the 'Seabed Working Group' which is studying the seabed emplacement of such high level radioactive wastes. Such a proposal would involve unbelievable amounts of long-life radioactive waste ''emplaced'' or dumped in the oceans far away from those nuclear powers who produced the poisons in the first place. I need hardly say that the areas being studied are close to small, non-nuclear countries. It seems unlikely that these studies and negotiations are going to end in the immediate future and it appears that technical issues and attempts to find appropriate wording to meet concerns of the different states involved will delay any final conclusion in the foreseeable future. In the circumstances, Australia could quite legitimately make clear its own position in relation to vessels and areas under its own jurisdiction. Any subsequent international agreement should not detract from this position. Australia would merely be exercising its sovereign rights under International Law to determine for itself what dumping it would allow by its citizens or in its maritime belt. The second report of the Commonwealth-State Committee on the Management of Radioactive wastes, released last evening, recommends the release of low level radioactive wastes into the air and water or buried in landfill areas in Australia. According to the Minister for Resources and Energy, these recommendations have the support of the Commonwealth. As I said at the beginning of my speech, in 1981 the then shadow Minister for the Environment, the Hon. Stewart West, moved an amendment to the Environment Protection (Sea Dumping) Bill 1981, an amendment which has been taken up by this Bill. In the words of the honourable member, 'There is no safe method known to science for the disposal of nuclear wastes'. This remains fact. I commend those words and this Bill to the Senate. Debate (on motion by Senator Grimes) adjourned. Bills received from the House of Representatives. Motion (by Senator Grimes) agreed to: That so much of the Standing Orders be suspended as would prevent the questions with regard to the several stages for the passage through the Senate of the Bills being put in one motion at each stage and the consideration of such Bills together in the Committee of the Whole. Ordered that the Bills may be taken through all their stages without delay. Bills (on motion by Senator Grimes) read a first time. Second Readings Senator GRIMES(Tasmania-Minister for Community Services)(10.12) —I move: That the Bills be now read a second time. I seek leave to have the second reading speech incorporated in Hansard. Leave granted. The speech read as follows- The purpose of these Bills is to amend the National Parks and Wildlife Conservation Act 1975 (Parks Act) and the Aboriginal Land Rights (Northern Territory) Act 1976 Land Rights Act) to enable implementation of the Government's decision to grant the land in Uluru (Ayers Rock-Mount Olga) National Park to an Aboriginal land trust and implementation of the agreement with the Aboriginal traditional owners to lease the area back to the Director of National Parks and Wildlife to be managed as a national park. A number of minor amendments are also being introduced to rectify anomalies which have been identified in the Parks Act relating to proclamation of parks and reserves and preparation of plans of management. The Ayers Rock-Mount Olga area was proclaimed as part of the Petermann Aboriginal Reserve in the 1920. In the area was excised from the Petermann Reserve and proclaimed as a reserve under the Northern Territory Crown Lands Ordinance. It was then managed for many years by the Northern Territory Reserves Board. When the National Parks and Wildlife Conservation Act, which we now propose to amend, was passed by the Parliament during the Whitlam Government, it was envisaged that the area would be proclaimed as a National Park under the Act. Uluru (Ayers Rock-Mount Olga) National Park was proclaimed in 1977. Uluru National Park, which includes Ayers Rock and the Olgas, is of great cultural significance to the Aboriginal people. The majestic splendor of Ayers Rock and the Olgas has also become a magnetic attraction for tourists from within Australia and overseas and during the past year over one hundred thousand people have visited Uluru National Park. This figure is expected to increase significantly now that the magnificent tourist facilities at Yulara Village just outside the park are operational. The real potential of Ayers Rock and the Olgas as a tourist destination was recognised in the late 1960's. Between 1968 and 1978 a number of studies were commissioned dealing with park visitor accommodation, air access, environmental matters and park planning. One report in particular, that in 1969 by Harris, Kerr, Foster and Company commissioned by the then Northern Territory Reserves Board, proposed a development plan which provided the initial stimulus for the development of the park and associated tourist facilities which has taken place in recent years. The concept of a tourist village was developed during the Whitlam Government to the point where a site outside the boundaries of the park was selected and approved by the Central Land Council which represented Aboriginal interests. The site was not proclaimed, however, until 1976. The Yulara tourist village is thus the culmination of 15 years of planning and effort. White Industries, the design and project managers and Philip Cox and Partners the consulting architects, have created a tourist village of world class at Yulara. The Village, which has cost over $150m, includes an international standard hotel, a motel, cabin accommodation and camping facilities providing a wide range of accommodation for visitors. The concept and design of the village display a sensitivity to the natural landscape and climate of the area. the architects, working with the environment, not against it, have incorporated the natural vegetation and the red sand dunes as features in the landscape design. A visitor to the village could only be favourably impressed with what has been created. The amendments to the Land Rights Act are necessary for two reasons: first, to enable the deed of grant to be made by providing a description of Uluru in schedule 1 to the Act and, second, to require the land trust, to which the deed is granted, to lease the area to the Director of National Parks and Wildlife so as to enable Uluru to be managed as a National Park under the Parks Act. Amendments to the Parks Act will introduce cooperative management arrangements for Uluru National Park which will provide the Aboriginals with an effective voice in the management of the park and which will ensure the continuing protection of both the natural and cultural values of the park. The granting of title to the traditional owners of Uluru and the leasing back to the government of that land in order to allow it to continue to operate as a national park is not a new concept. Honourable senators will be aware that the previous conservative government introduced a similar arrangement in the top end of the Northern Territory in respect of Kakadu National Park. In addition, the Northern Territory Government has itself granted freehold title to land to traditional aboriginal owners on the basis that it be used as a national park. The amendments will enable Uluru to be both aboriginal land and a national park. In its latter capacity, it will be available to all who wish to view the grandeur of the rock and the surrounding areas. For traditional aboriginal people, grant of title to the land will be a recognition in law that it is their land, land which holds their spiritual roots and is to them an outward manifestation of their very being. The lease-back arrangements agreed with the traditional Aboriginal owners of Uluru provide for: The traditional owners to lease Uluru to the Director of National Parks and Wildlife for a period of 99 years, and An annual rental of $75,000 plus 20 per cent of gross park entrance fees, to be paid by the Commonwealth. The rental will be reviewed whenever the plan of management is rewritten but, in any event, not less than every 5 years. The Parks Bill provides for the establishment of a board for Uluru National Park or for any other park or reserve containing aboriginal land, as defined in the Parks Act, that may at some future time be declared by regulation to be a prescribed park or reserve as defined in the Bill. Before a board is established the Minister administering the Parks Act and the relevant Aboriginal Land Council agree on the name, composition and specific requirements for membership of the Board. The Minister then establishes the Board by notice in the Gazette. The functions of boards and procedures relating to boards are also set down in the Parks Bill. The agreement reached for Uluru National Park provides for the establishment of an Uluru board of 11 members consisting of 6 Aboriginals nominated by the traditional owners; the Director of National Parks and Wildlife; one other Commonwealth official nominated by the Minister for Arts, Heritage and Environment; a representative of the tourist industry nominated by the Minister for Sport, Recreation and Tourism and two representatives of the Northern Territory. It is significant in regard to the role of Aboriginals in managing Uluru National Park, that they will be in a majority on the Uluru Board and that there is a provision in the Parks Bill, that they should be in a majority at all meetings. The Uluru board will have an important role in both the development and management of Uluru National Park and will advise the Minister on all aspects of these matters. I expect that, when the Board is appointed, it will begin immediately, in conjunction with the Director of National Parks and Wildlife, to draw up a new plan of management for the Park. The new plan will take effect when the present plan expires in 1987, or beforehand if the new plan is ready. The amendments to the Parks Act provide for the resolution of disagreements between the director of National Parks and Wildlife and the Board during both the preparation of the plan of management and the implementation of the plan. The amendments provide firstly for a disagreement to be referred to the Minister administering the Parks Act for resolution. If the Minister is unable to resolve the disagreement, the Minister is required to appoint an arbitrator, suitably qualified to deal with the matter impartially and to report to the Minister. The Minister will determine the matter taking account of the arbitrator's findings. I fully expect that, in practice, a spirit of co-operation will prevail and occasions on which the Minister will need to use these provisions will be very rare indeed. The Government will meet the cost of the rental and certain administrative expenses related to the operation of the Board. The total cost is estimated to be $150,000 per annum. These costs are additional to on-going costs for the management of the park. The payment of rental, which in 1985-86 is expected to amount to $100,000, together with opportunities for employment created by the park and associated tourist facilities, will add substantially to the economic base of the Aboriginal community and further enhance Aboriginal self-determination and self-management. The arrangements being provided for Uluru National Park through amendments to the Parks Act are likely to set a pattern that could be followed, at any time in the future, for the management of other National Parks containing Aboriginal land. I now refer to the minor amendments to the Parks Act which are included in the schedule to the Parks Bill. These amendments clarify the Act as it now stands and allow implementation of what I believe to be the original intention of the Act. The Act, as it is presently written is unclear as to whether land can be added to an existing park, reserve or wilderness zone by varying an existing proclamation. Confusion over the meaning of the Act has prevented, for example, the amalgamation of Kakadu (stage 2) National Park with stage 1 of the park. The amendments remove this unintended barrier. They also clarify the public comment requirement in regard to the declaration, amendment or revocation of a park, reserve or wilderness zone. The Act, as it is now written, does not require public comment in regard to the declaration of a park or reserve within the ''region''. Region, as defined in the Act, includes stages 1 and 2 of Kakadu National Park, and by virtue of this Bill will include Uluru National Park, but excludes Arnhem Land and the Mount Bundy, Gimbat, Goodparla and Eva Valley pastoral leases. Amendments maintain this existing situation. The amendments also provide that public comment is not required for an addition to a park, reserve or wilderness zone within the region, as defined, or the transfer of an area from one park, reserve or wilderness zone to another. The amendments confirm, however, that any proposal to revoke a proclamation or to remove an area from a park, reserve or wilderness zone must be subject to public review and a report to the Governor-General in accordance with the Act. Honourable senators will agree that clarification of this issue is vital to the future security of our national parks and reserves. I commend these Bills to the Senate. Debate (on motion by Senator Reid) adjourned. Bill received from the House of Representatives. Ordered that the Bill may be taken through all its stages without delay. Bill (on motion by Senator Grimes) read a first time. Senator GRIMES(Tasmania-Minister for Community Services)(10.13) —I move: That the Bill be now read a second time. I seek leave to have the second reading speech incorporated in Hansard. Leave granted. The speech read as follows- This Bill continues the practice of introducing an omnibus Bill into each sittings of the Parliament to make a large number of non-contentious amendments. The Bill amends some 65 Acts to remove obsolete provisions relating to the rights of Commonwealth public servants. Those provisions were made redundant by the repeal on 15 March 1981 of the Officers' Rights Declaration Act 1928. Officers' rights are now preserved by section 87TA of the Public Service Act 1922. The Australian Citizenship Amendment Act 1984 which was passed by the Parliament in the Budget Sittings 1984 provided for the repeal of the definition of British subject status in the Australian Citizenship Act 1984 at a date to be proclaimed. Any reference in other Acts to ''British subject'' or to the status of British subject has meaning only by virtue of the definition of the expression in the Australian Citizenship Act. The amendments to 10 Acts remove references to British subject to ensure that the proposed proclamation of the repeal does not cause problems with interpretation of the expression. Administrative changes to the Commonwealth Public Service were made following the elections last year. The changes included the renaming of departments, the creation of a new department and the transfer of functions. Amendments to 25 Acts have been included in the Bill as a consequence of these changes to the machinery of Government. I propose, with the leave of the Senate, to have incorporated into Hansard the full text of the second reading Speech explaining in detail many of the changes to the various Acts which are to be made by this Bill. Amendment of the Airports (Surface Traffic) Act 1960 The amendment of this Act allows proceedings to be taken against a person or persons carrying on a business when a vehicle is registered in that business name. This amendment overcomes doubts whether action can be taken against the owner of such vehicles in respect of an infringement of the Act involving the vehicle. A number of formal and drafting amendments have been made to the Act in accordance with current drafting practice and administrative changes. Amendment of the Antarctic Treaty (Environment Protection) Act 1980 Australia has a long standing policy of support for measures for the conservation of the Antarctic environment and the protection of its fauna and flora. The amendment of the Act enables the ratification of the Convention for the Conservation of Antarctic Seals. Australia has played an active role in drafting the Convention the aims of which include both the protection and study of Antarctic seals and the exchange of scientific data. Amendment of the Australian Citizenship Act 1948 The amendment of this Act will enable the oath of allegiance or affirmation of allegiance to be taken before or after a certificate of Australian Citizenship is issued and will require that those persons who are empowered to administer the oath of allegiance or affirmation of allegiance are Australian citizens. A saving provision ensures that the grant of citizenship is effective even if the person administering the oath or affirmation is not an Australian citizen. The amendment also enables the Minister to administer the oath or affirmation. Amendment of the Australian Institute of Marine Science Act 1972 The amendment to this Act will permit the making of standing acting appointments to the office of Director of the Australian Institute of Marine Science, thus obviating the need for Executive Council action to be taken in respect of every absence of the Director. Amendment of the Australian Meat and Live-stock Industry Selection Committee Act 1984 Sub-section 21 (1) of this Act could lend itself to an unintended interpretation as to the majority required for decisions taken by the Selection Committee without a formal meeting. The amendment removes the possibility that this sub-section could be interpreted as permitting decisions to be taken with the support of fewer members than the number required for a quorum at meetings of the Committee. Amendment of the Australian Security Intelligence Organization Act 1979 The amendment to this Act is made in the light of a recommendation from the Security Appeals Tribunal. The Tribunal reviews, on request, adverse or qualified security assessments furnished by ASIO to Commonwealth agencies in specified circumstances. the Act currently requires the Tribunal, subject to one qualification, to give copies of its findings to the applicant, to ASIO, and to the Commonwealth agency concerned. The Tribunal has recommended that it should have a discretion to furnish copies of its findings to the Attorney-General. The government accepts the spirit of the recommendation, but considers that the Attorney-General should be given a copy of the findings in every case because he is responsible for ASIO and for the administration of the Act and the amendment, accordingly, implements this provision. Amendment of the Australian Tourist Commission Act 1967 The amendment to this Act empowers the Commission to invest its funds, by making the Commission subject to Division 2 of Part XI of the Audit Act 1901, instead of Division 3 of Part XI as at present. This will enable the Commission to make the best possible use of any surplus funds which it may have available and will require it to keep its accounts in accordance with normal commercial practice. Bass Strait Freight Adjustment Levy Collection Act 1984 The amendments to this Act permit adjustment levies imposed under this scheme to be recovered in the same way as if they were excise duties and enables the responsible Minister to notify proposed levy adjustment alterations when Parliament is not sitting. Bounty (Electric Motors) Act 1984 The amendment to this Act will ensure that the value added figure applied to a bountiable motor includes the cost of any process or service (if provided by the manufacturer at registered premises) unless research, development or design costs apply. These latter costs, if incurred in Australia, attract a bounty irrespective of whether or not the work was undertaken on registered premises. Amendment of the Bounty (Paper) Act 1979 The amendment to this Act substitutes a more precise and modern test for the determination of whether paper is to be regarded as uncoated. Since the introduction of the Act, the proposed test has been adopted by the industry as a more precise and accurate test method. Amendment of the Cocos (Keeling) Island Act 1955 One of the amendments to this Act which deserves mention is the insertion of a new section which will enable Ordinances of the Territory of Cocos (Keeling) Islands to be made. These will improve the operation of the Supreme Court of the Territory, and will make access to, and dealings with, the Supreme Court easier for members of the public. Amendment of the Conciliation and Arbitration Act 1904 The amendments to this Act relate to the financial accounting and reporting requirements under Part VIIIAA of the Act, for registered organisations and their branches. Organisations or branches whose annual incomes do not exceed $10,000 will be able to apply to the Industrial Registrar for a certificate of exemption from the existing financial and reporting requirements of Part VIIIAA. This amendment will enable the preparation of accounts to be less onerous and costly. The other requirements of Part VIIIAA will continue to apply to organisations or branches with a certificate, including those dealing with rights of individual members to seek further information and the powers and duties of the Registrar to investigate and rectify deficiencies. Amendment of the Defence Act 1903 Under the common law, members of the Defence Force cannot sue the Commonwealth for moneys owing to them in respect of their service. Section 12 of the Act varies this position to a limited extent by permitting members to sue after leaving the Defence Force. This situation is changed by extending to serving members of the Defence Force the right to sue. Because garnishee proceedings do not lie against the Crown, this procedure is not available to creditors of members of the Defence Force. The amendments create similar statutory rights and obligations regarding garnishee proceedings in relation to members of the Defence Force to those applying to other Commonwealth employees. Amendment of the Defence Force Discipline Act 1982 The provisions of this Act provide for the issue of summonses and warrants on the basis of sworn information or affidavit. The amendments empower authorised officers of the Defence Force to swear informations. Under the Act a commanding officer may direct that a subordinate summary authority is not to deal with a particular charge against a person. The amendments will enable a commanding officer to direct that a subordinate summary authority is not to deal with a class of cases. There is a requirement under the Act that legal officers, to whom convictions by summary authorities are referred for legal advice, should be authorised or appointed for this purpose. The amendments omit the requirement for such authorisation or appointment, as this would create an unjustifiable administrative burden. Amendment of the Federal Court of Australia Act 1976 Following consultation with the Northern Territory government, amendments to the Act will ensure that appeals from the Supreme Court of the Northern Territory will lie to the Northern Territory Court of Appeal instead of the Federal Court of Australia. The amendments are expressed to come into operation on a date to be fixed by Proclamation after appropriate consultation with the Northern Territory Government and the establishment of a Court of Appeal in the Northern Territory. The amendments are consistent with the Northern Territory exercising responsibility for courts established under Northern Territory legislation. Amendment of the Federal Proceedings (Costs) Act 1981 The amendments to this Act enable the court to award costs to a successful appellant where there was no respondent in the appeal, or where the appeal was to the A.C.T. Supreme Court against a criminal conviction in the Court of Petty Sessions and a new trial was ordered. Amendment of the Great Barrier Reef Marine Park Act 1975 In conformity with the general practice in Commonwealth legislation, the Act is amended to apply those provisions of the Crimes Act 1914 relating to conspiracy or being an accessory to an offence committed under that Act, and to allow the court to dismiss a charge or discharge a person upon giving adequate security. Under the present provisions of the Act, Regulations cannot apply to unzoned areas of the Marine Park if more than 2 years has elapsed since the area became part of the Marine Park. The Act is amended to extend this period from 2 years to 3 years, so that there will be some control over activities in areas declared part of the Marine Park in August 1983 and for which zoning plans are unlikely to be in force by August 1985. The Act is also amended to define the Authority's role as manager of the Marine Park and includes in that role the provision of educational, advisory and information services relating to the Marine Park and its management. Further amendments increase the penalty for unauthorised drilling or mining in the Marine Park from $1,000 a day to $50,000 for each day the offence continues. Amendment of the Health Insurance Act 1973 A number of amendments to the Health Insurance Act are being made as a consequence of the replacement of the Capital Territory Health Commission by the Australian Capital Territory Health Authority which was effected by the Health Services Ordinance 1985. Amendment of the Historic Shipwrecks Act 1976 The Act provides a good legislative example of Commonwealth-State co-operation. The Commonwealth is empowered to co-ordinate measures for the protection of the national maritime heritage with the States taking an active role in the survey, identification, protection, recovery, preservation and exhibition of historic shipwrecks and relics. The Minister has consulted the relevant State Ministers on these proposed amendments and there has been general support. There has been growing interest in historic material located beneath Australian waters. Because of its nature and situation this material is particularly vulnerable, and since the commencement of the Act experience has shown that the legislation requires clarification and strengthening. Certain known shipwrecks of historical significance straddle the low-water line. At present only those remains, or articles associated with a ship, which lie below the low-water line can be the subject of a declaration for protection under section 5 of this Act. If part of a wreck situated above the low-water line is removed the historic value of the wreck is diminished. The amendments provide that the remains of wrecks and articles associated with them, including those above the low-water line, can be protected, provided a Minister of the State concerned has informed the Federal Minister in writing that the Government of that State has no objection. The amendments also extend protection to articles washed up, as well as those removed from Australian waters. In addition to the declaration of individual wrecks, the amendments allow a State (defined as including the Northern Territory and Norfolk Island) to seek a general declaration on all wrecks over 75 years old, including a general declaration to cover wrecks situated in waters adjacent to Commonwealth Territories. A power of revocation in respect of individual wrecks is included in the amendments, because detailed examination of a particular wreck could indicate that it did not warrant protection. At present a provisional declaration is limited to one year. In practice this has been found an inadequate period for completion of site explorations, and it is proposed to increase this to five years. The Act limits the area of a protected zone to 100 hectares. A protected zone of up to 200 hectares is necessary because shipwrecks can be widely scattered and 100 hectares is too small an area for accurate fixing by satelite navigation. The Minister's powers under Section 11 are extended to obtain the custody of articles or historic relics for the purpose of placing in collections. This section relates to the power of the Minister to give directions in relation to the custody, preservation, and exhibition of historic shipwrecks and relics. To provide an incentive to people to assist the protection of historic shipwrecks, the Minister's powers are extended to make monetary awards or make a gift of certain memorabilia. The penalties under the Act are brought up to date. Amendment to the Home Deposit Assistance Act 1982 The evidentiary provisions are unsatisfactory because the Secretary is the only officer of the Department who can attest to documentary evidence provided to the courts. The amendments will enable the Secretary to appoint other officers of the Department for this purpose. Amendment of the Home Savings Grant Act 1964 The evidentiary provisions are unsatisfactory because the Secretary and Regional Directors are the only officers of the Department who can attest to documentary evidence provided to the courts. The amendments will enable the Secretary to appoint other officers of the Department for this purpose. Amendment of the Home Savings Grant Act 1976 The evidentiary provisions are unsatisfactory because the Secretary and Regional Directors are the only officers of the Department who can attest to documentary evidence provided to the courts. The amendments will enable the Secretary to appoint other officers of the Department for this purpose. Amendment of the Immigration (Guardianship of Children) Act 1946 Under the Act the Minister for Immigration and Ethnic Affairs is the guardian of minors entering Australia who do not accompany or join, a parent or relative over the age of 21 years who provides care for them. The amendments will enable the Minister to provide guardianship to minors who have entered Australia with a supporting relative, when care arrangements have broken down. The consent of the supporting relative is required. A person affected by a decision made under the amendment may, where the decision is made by a delegate of the Minister, seek reconsideration of the decision by the Minister and may then apply to the Administrative Appeals Tribunal for a review of the Minister's decision. Where the Minister makes the original decision a person affected by the decision may apply directly to the Administrative Appeals Tribunal for review. Amendment of the Independent Schools (Loans Guarantee) Act 1969 The amendment to this Act requires the annual report to be based on a calendar year instead of a financial year. This change conforms with the annual reporting requirements of the other Acts administered by the Commonwealth Schools Commission. Amendment of the Industrial Research and Development Incentives Act 1976 The amendment to this Act puts beyond doubt that public interest projects may be assisted where the projects relate to development in a field of science or technology, as well as industrial research. Amendment of the Insurance Contracts Act 1984 The amendments overcome minor problems relating to the provision of information or advice to insurers and clarify the nature of the information or advice to be provided in particular instances. The amendments should facilitate the operation of the Act when it comes into operation later this year. Amendment of the Judiciary Act 1903 The amendment to this Act is associated with an amendment to the Federal Court of Australia Act 1976 which removes the right of appeal from the Supreme Court of the Northern Territory to the Federal Court of Australia. The proposed amendment confers appellate jurisdiction on the High Court of Australia to hear and determine appeals from judgments of the Supreme Court of the Northern Territory. Appeals from the Supreme Court of the Northern Territory will lie to the High Court only by special leave of the High Court. The effect of the amendment is to put appeals from the Supreme Court of the Northern Territory on the same footing as appeals from State Supreme Courts. There is a transitional provision included, so that the amendment applies to judgments given or pronounced before or after this amendment, which will come into operation on the same day as the amendment to the Federal Court of Australia Act 1976 comes into operation. Amendment of the Life Insurance Act 1945 The amendments to this Act arise from the provisions in the Income Tax Assessment Act 1936 dealing with the conversion of lump sum termination payments to annuities. Under the existing provisions of the Life Insurance Act 1945 the issue of such annuities would need to be transacted as part of the ordinary class of life insurance business of a life office. However, it is essential for a life office to be able to conduct this business as a part of its superannuation business, as both are now treated alike for taxation purposes. The amendments provide the necessary flexibility for the Commissioner to approve this procedure where he is satisfied that it would be appropriate, and would generally assist in achieving the Government's broad objective of encouraging the greater use of annuities as a means for providing income in retirement. Amendment of the Management and Investment Companies Act 1983 The principal amendments to this Act relate to an increase in the time limit allowed for the filing of annual returns by licensed management investment companies, and a consequential change in the expiry date for licences. The changes will allow management investment companies a more reasonable and realistic period of time within which to comply with these requirements. Amendment of the National Gallery Act 1975 A number of amendments to the Act will provide, inter alia, for more efficient administration of the Gallery, give the Gallery additional functions and activities, provide for an Australian National Gallery Fund and give the Gallery a power of investment. The amendments are largely of an administrative and machinery nature and only the more important amendments are mentioned here. The amendments to section 7 of the Act empower it to engage in a number of new activities including- Commissioning works of art for the National Collection and for sale separately; Professional advice and services to both Government and the public; Selling original works of art not in the National Collection, and reproductions; Hire of Gallery facilities and entry charges for special exhibitions and events. Section 10 of the Act is amended to make it clear that exchanges are not limited to one-for-one transactions and provide for exchanges of works which are advantageous additions to the collection. Amendments to section 22 enable the Council to delegate non-staff matters to members of the staff. The power of delegation by the Council may be exercised without Ministerial approval. The position of Administrator has been established in place of Secretary and Manager. The statutory position of Director of the Gallery remains and the powers of an acting Director are specified. The amendment gives the Gallery a general power of investment and establishes an Australian National Gallery Fund into which may be paid moneys received from private citizens and corporate sponsors. The Gallery is declared to be subject to Division 3 of Part XI of the Audit Act 1901. Amendment of the National Health Act 1953 Some of the penalties set out in the Act have not been increased since it was first enacted in 1953 and, as such, have little deterrent value. Following a thorough review, all penalties in the Act are being amended to reflect the community's perceptions of the seriousness of the various offences and to bring them into line with current economic values. A new definition of Secretary is to be inserted into the Act to reflect the joint administration of the Act by the Departments of Health and Community Services Amendment of the Patents Act 1952 The amendments replace the words ''British subject'' with ''Australian citizen'', as a consequence of the amendment of the Australian Citizenship Act 1948 by the Australian Citizenship Amendment Act 1984. The proposed amendments ensure that an abstract of a patent specification will be published at, but not before, the date on which the patent application and specification are published. Other amendments update the penalty provisions for offences under the Act, most of which have not been amended since the Act came into force. Amendment of the Petroleum Retail Marketing Franchise Act 1980 The amendment to this Act corrects a technical inconsistency between one of the grounds for non-renewal of a franchise agreement and the resulting extension of the term of the franchise agreement when that ground is relied upon. The amendment to this Act shall be deemed to have come into operation immediately after the commencement date of section 16 of the Petroleum Retail Marketing Franchise Amendment Act 1984. Amendment of the Public Works Committee Act 1969 The amendment to this Act increases the statutory limit, above which proposals for public works must be referred to the Public Works Committee, from $2m to $6m. The increase takes account of increases in costs since the statutory limit was last amended in 1973. Amendment of the Protection of the Sea (Prevention of Pollution from Ships) Act 1983 The amendments to the Act give effect to minor technical amendments recently adopted by the Marine Environment Protection Committee of the International Maritime Organisation's International Convention for the Prevention of Pollution from Ships, 1973-78. Amendment of the Sex Discrimination Act 1984 The amendment to this Act will enable ''class'' exemptions from the Act to be granted, in certain circumstances, to avoid a multiplicity of applications. Amendment of the Trade Union Training Authority Act 1975 The amendments to the Act overcome administrative problems which have arisen since the Act was extensively amended in 1978. The amendments have the general support of the National Labour Consultative Council. These amendments abolish the present Australian Council for Union Training and the Authority's Executive Board replacing them with a new Australian Council for Union Training responsible for formulating TUTA's policy. A smaller Executive Committee, responsible for implementation of the Australian Council's policy, will be appointed from the Council. State Councils for Union Training will be re-named Regional Councils for Union Training and be given responsibility for ensuring that TUTA's training activities in their State or Territory accord with the policy of the Australian Council. In addition, the responsibilities of the Director of Studies will be made clear by requiring the occupant of that office, subject to the direction of the National Director, to be responsible for the planning, development and implementation of training in accordance with the policy of the Australian Council. Debate (on motion by Senator Reid) adjourned. Bill received from the House of Representatives. Ordered that the Bill may be taken through all its stages without delay. Bill (on motion by Senator Grimes) read a first time. Senator GRIMES(Tasmania-Minister for Community Services)(10.13) —I move: That the Bill be now read a second time. I seek leave to have the second reading speech incorporated in Hansard. Leave granted. The speech read as follows- By this Bill, the Government proposes to amend the National Health Act to effect two changes to the Pharmaceutical Benefits Scheme. The first of these changes relates to the occasional situation where the Minister for Health and the manufacturer of a drug are unable to agree upon the price of a drug. Under the existing legislation, the Government is placed in an invidious situation when a manufacturer unilaterally increases the price of a drug. The Government may either continue to list that drug as a Pharmaceutical Benefit and meet the additional cost imposed by the manufacturer, or it may remove the drug from the list of Pharmaceutical Benefit Drugs. In the latter case, patients must either meet the full retail cost of the drug or forego the treatment recommended by their doctors. Though bilateral agreements on drug prices are extremely desirable, there have been several occasions in the past when agreement could not be reached with a manufacturer. When such disagreements occur, the Government believes that patients should not be faced with a choice between meeting the full cost of drugs-no matter what effect that might have on their own financial resources-or foregoing recommended treatment. I note a further deficiency in the operation of the existing legislation. When a new drug is recommended for listing as a Pharmaceutical Benefit there can be considerable delay in reaching agreement with the manufacturer as to the price of that drug. Under the existing provisions no government subsidy can be available until agreement is reached. Accordingly, by the first of these amendments the Minister for Health will be allowed to determine a price upon which reimbursement to pharmacists is made in respect of those drugs where there is no agreement with a manufacturer. This will apply to drugs which, desirably should be listed as Pharmaceutical Benefits under the Pharmaceutical Benefits Scheme. The proposed amendment to Part seven of the National Health Act would also allow the Minister to determine a special patient contribution in respect of such a drug. The special contribution would amount to the difference between the total reimbursement that a pharmacist should receive, based upon the manufacturers' actual price, and that reimbursement that the pharmacist would have received if the price of the drug had been set at a level acceptable to the Minister. The patient concerned would be required to pay the special patient contribution in addition to the appropriate normal contribution. Concessional beneficiaries and pensioners would be required to pay the same special patient contribution as the rest of the community. The effect would be that the drug would continue to be available as a pharmaceutical benefit and thus to be subsidised by the Commonwealth. Patients would then be able to obtain the drug at a charge less than the full price which would have applied if the drug had been removed from the list of pharmaceutical benefits. The second of the changes is part of the package of measures announced by the Treasurer (Mr Keating) on 14 May. The general patient contribution for pharmaceutical benefits has been increased by one dollar with effect from 1 July 1985. This will bring the patient contribution to $5 from the existing level of $4. This is the first increase in the price of pharmaceutical benefits in the two and a half years since 1 January 1983. Over that period the average cost of a general benefit prescription has increased from $6.03c to an estimated $7.38c, an overall increase of $1.35c. Despite this the Government has decided to limit the increase in the general patient contribution to $1; an action, I might say, in sharp contrast to the 167% increase in the general patient contribution during the seven years of the previous Government. I emphasise that no change is being made in the cost for concessional beneficiaries which is to remain at $2, and pensioners will still be able to obtain pharmaceutical benefits free of charge. For the first change, only a small number of drugs are involved in price disagreements between manufacturers and the Minister. The cost to the Government of the proposal to list drugs as pharmaceutical benefits where there are price disagreements will be insignificant. However, the economic benefits to individual patients who require a price disagreed drug will be considerable. With the second change, the increase in the general patient contribution for pharmaceutical benefits will result in an estimated saving of $40.3m per annum. I commend the Bill to the Senate. Debate (on motion by Senator Reid) adjourned. Bill received from the House of Representatives. Ordered that the Bill may be taken through all its stages without delay. Bill (on motion by Senator Grimes) read a first time. Senator GRIMES(Tasmania-Minister for Community Services)(10.15) —I move: That the Bill be now read a second time. I seek leave to incorporate the second reading speech in Hansard. Leave granted. The speech read as follows- As part of its cost saving measures, announced by the Treasurer earlier this evening, the Government has decided to increase by a lesser amount than is currently provided for under the Local Government (Personal Income Tax Sharing) Act 1976, personal income tax sharing grants payable to local government in 1985-86. The purpose of this Bill is to give effect to the changes that are necessary to that Act. At present the Local Government (Personal Income Tax Sharing) Act 1976 provides for local government to receive every year 2 per cent of personal income tax collected in the previous year. Had this arrangement been continued, grants for local government in the states in 1985-86 would have increased by nearly 20 per cent or by some $97m. The Government considered that this increase was excessive in the current circumstances and that local government authorities should share in the expenditure restraint that will need to be exercised by other spheres of government in order to lay the foundation for sustained economic growth. It is therefore proposing a special arrangement, for 1985-86 only, whereby local government will receive an amount equal to the grant in 1984-85 increased in real terms by 2 per cent. On the basis of available estimates it is anticipated that this new formula will result in local government receiving $531m in 1985-86, an increase of $45m on grants made available in 1984-85. This means that, as compared with a situation under which the present arrangements would have continued to apply, the saving to the Government will be $52m. It is important to note that this new arrangement will be applicable for 1985-86 only. The arrangements to apply after 1985-86 will be determined by the Government following its consideration of the report of the national inquiry into local government finance. This inquiry, which I announced in May last year, has been conducting hearings throughout the country and is undertaking a particularly thorough examination of the Local Government (Personal Income Tax Sharing) Act and other aspects of local government finance. Its Chairman, Professor Peter Self, has indicated that he will present his report to the Government by the end of September. On this basis, I would expect the Government to have considered the report, considered the views of all interested parties on the report and introduced any necessary changes to the Act in time for them to be effective for the 1986-87 financial year. The arrangements that are to be introduced for 1985-86 adhere fairly closely to those which had previously applied. The process will begin before the end of August when the Treasurer, at the time of his Budget announcements, will publish the estimated movement in the consumer price index in the year to the March quarter 1986. The States will be advised of this estimate together with an estimate of the grants they will receive for distribution to local government. As is the case at present, the States will then advise me of the proposed allocation of grants to local government together with an assurance that the allocations have been made in accordance with the Act. I will satisfy myself that the Act has been complied with and then advise the Treasurer of my views. The Treasurer immediately authorises payment to the State concerned. The Bill provides that the payments made to the States for local government can be adjusted if the actual change in the consumer price index is different to that which was estimated in August. This adjustment would be made following the release of the consumer price index for the March quarter 1986. If the estimated increase in the consumer price index for the year exceeds the actual increase, the States will be required to repay to the Commonwealth the difference. If, on the other hand, the actual increase exceeds the estimated increase, the Commonwealth will be required to increase its payments to the States. If a State is required to repay the Commonwealth, the Bill permits this to be deducted from payments in future years. If a State is entitled to additional payments the Bill requires that they be distributed among local governing bodies in the same way as the first payment was distributed. The Act does not apply to payments the Commonwealth Government makes to the Northern Territory Government for the five local government authorities in that Territory. However the memorandum of understanding with the Northern Territory Government requires that those payments are to be made on a similar basis to those for local government elsewhere in Australia, and this will be reflected in payments to the Territory for local government in 1985-86. In concluding I would like to emphasise that the grant that will be provided to local government in 1985-86 represents an increase of some $45m. It is the largest increase since 1982-83. It is also important to recall this Government's commitment to local government. In 1983 we established the first Ministry of Local Government. We strengthened its role under the revised administrative arrangements that were introduced last December by combining it with related functions of regional development and Commonwealth property. We have ensured that local government is represented in the highest economic forums of the land. We have supported the constitutional recognition of local government. We have introduced the local government development program to assist local authorities to strengthen their efficiency and capacity. We have expanded and introduced other programs involving local government, such as the Australian land transport program and community services programs. Overall Federal Government grants, both tied and untied, to local government now total nearly $1 billion per annum. This represents a 50 per cent increase in the first two years of the Government on the last year of the Fraser Government. These facts emphasise that the Government is firmly committed to raising the status and strengthening the capacity of local government throughout Australia. We have put in place the basis for a fuller national recognition of the importance of local government and are building upon it. Our commitment to local government is enduring. It is a commitment which the Government will continue to work towards. Debate (on motion by Senator Reid) adjourned. Message received from the House of Representatives acquainting the Senate of the following resolution which was agreed to by the House of Representatives: That the House of Representatives, recognising the desirability of a thorough review of the Australian Constitution in the light of experience since its establishment and of modern day requirements, agrees that the Commonwealth Parliament continue its participation in the Australian Constitutional Convention established to review the Commonwealth of Australia Constitution and accordingly resolves: (1) That, for the purposes of the Convention- (a) a delegation from the Commonwealth Parliament take part in the deliberations of the Convention, and comprise 12 members of the Parliament of whom 4 shall be members of the Senate and 8 shall be Members of the House of Representatives; (b) the 8 Members of the House of Representatives comprise 4 members of the Australian Labor Party, 3 members of the Liberal Party of Australia and one member of the National Party of Australia. (2) That- (a) the Prime Minister and 3 other Members of the House of Representatives, being members of the Australian Labor Party, nominated by him; (b) the Leader of the Opposition and 2 other Members of the House, being members of the Liberal Party of Australia, nominated by the Leader of that Party; and (c) the Leader of the National Party of Australia or another Member of the House, being a member of the National Party of Australia, nominated by the Leader of that Party, be members of the Delegation. (3) That the Prime Minister or his nominee be the Leader of the Delegation, and the Leader of the Opposition or his nominee be the Deputy Leader. (4) That a member of the Delegation cease to be such a member if- (a) he ceases to be a member of the Commonwealth Parliament; (b) the House of the Parliament of which he is a member terminates his appointment; or (c) he resigns as a member of the Delegation by writing addressed to the President of the Senate or the Speaker of the House of Representatives, as the case requires. (5) That where, because of illness or any other cause, a member of the Delegation is not available to attend a meeting, or part of a meeting, of the Convention, the Leader or senior available member of that member's Party may nominate an alternative member and the member so nominated shall be a member of the Delegation for that meeting, or that part of that meeting. (6) That, in the event of a member of the Delegation ceasing to be such a member, the Leader of that member's Party in the House from which that member was drawn may nominate another member (being a member of the House of which the first-mentioned member is or was a member) to replace the first-mentioned member. (7) That the Leader of the Delegation from time to time make a report for presentation to each House of the Parliament on matters arising out of the convention, and that the Deputy Leader of the Delegation may make an accompanying Motion report. Motion Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(10.18) —On behalf of the Manager of Government Business (Senator Grimes) I move: That the Senate, recognising the desirability of a thorough review of the Australian Constitution in the light of experience since its establishment and of modern day requirements, agrees that the Commonwealth Parliament continue its participation in the Australian Constitutional Convention established to review the Commonwealth of Australia Constitution and accordingly resolves: (1) That, for the purposes of the Convention- (a) a Delegation from the Commonwealth Parliament take part in the deliberations of the Convention, and comprise 12 members of the Parliament of whom 4 shall be members of the Senate and 8 shall be members of the House of Representatives; (b) the 4 members of the Senate comprise 2 members of the Australian Labor Party, one member of the Opposition and one member of the Australian Democrats. (2) That- (a) 2 Senators being members of the Australian Labor Party, nominated by the Leader of the Government in the Senate; (b) one Senator being a member of the Opposition, nominated by the Leader of the Opposition in the Senate; and (c) one Senator being a member of the Australian Democrats, nominated by the Leader of that Party in the Senate. be members of the Delegation. (3) That the Prime Minister or his nominee be the Leader of the Delegation, and the Leader of the Opposition or his nominee be the Deputy Leader. (4) That a member of the Delegation cease to be such a member if- (a) he ceases to be a member of the Commonwealth Parliament; (b) the House of Parliament of which he is a member terminates his appointment; or (c) he resigns as a member of the Delegation by writing addressed to the President of the Senate or the Speaker of the House of Representatives, as the case requires. (5) That where, because of illness or any other cause, a member of the Delegation is not available to attend a meeting, or part of a meeting, of the Convention, the Leader or senior available member of that member's Party may nominate an alternative member and the member so nominated shall be a member of the Delegation for that meeting, or that part of that meeting. (6) That, in the event of a member of the Delegation ceasing to be such a member, the Leader of that member's Party in the House from which that member was drawn may nominate another member (being a member of the House of which the first-mentioned member is or was a member) to replace the first-mentioned member. (7) That the Leader of the Delegation from time to time make a report for presentation to each House of the Parliament on matters arising out of the Convention, and that the Deputy Leader of the Delegation may make an accompanying report. (8) That a Message be sent to the House of Representatives acquainting it of the Resolution agreed to by the Senate. Earlier this year the Executive Committee of the Australian Constitutional Convention decided that the Brisbane meeting should go ahead as planned from 29 July to 2 August, notwithstanding the failure of the 1984 referendums. Most of the Parliaments have now passed their resolutions and all have accepted the principle of equal government and non-government representation and a reduction in the size of the delegations. If the principle of equal representation is in fact carried through to fruition that should remove one of the major sources of dissension at the Adelaide conference and that state of affairs is much to be welcomed. The resolutions of the Commonwealth Parliament also provide for equal government and non-government representation. As in 1983 they make provision for representation of the Australian Democrats. The Brisbane meeting will be the sixth meeting of the Convention and will be a smaller gathering than any of the previous meetings. Agreement has been reached to reduce the size of the Convention with a view to allowing individual delegates more opportunities to speak and generally improving the Convention's procedures. The Commonwealth delegation has been reduced from 16 to 12, each State delegation has been reduced from 12 to eight and each local government delegation has been reduced from three to two. Representation of the Northern Territory and the Australian Capital Territory remains at two each. The total size of the Convention has been reduced from 112 to 78. So far as the composition of the Commonwealth 12 is concerned, the motion before us and that which has just been transmitted from the House of Representatives propose that there be eight delegates from the House of Representatives and four from the Senate, this formula being consistent, as I understand it, with discussions which took place between the Attorney-General, Mr Lionel Bowen, and the shadow Attorney-General, Mr N. A. Brown, at the time of the executive committee meeting. On the basis of a six-six split between Government and Opposition the numbers would fall out for the Government as four delegates from the House of Representatives and two from the Senate. For the non-government six it would mean, as the motion sets out, four representatives from the House of Representatives, and two senators, one of whom would be from the Opposition and the other from the Australian Democrats. The Opposition has now indicated that it would prefer that the non-government six were, in fact, divided three-three between the House of Representatives and the Senate, thus making it possible for there to be three Opposition delegates from the House of Representatives, two Opposition delegates from the Senate and still one Australian Democrat. I understand that Senator Durack will move an amendment to accomplish that state of affairs while leaving untouched the Government side of the delegation. The Government has no opposition whatsoever to that proposed course. We see it as entirely a matter for the non-government parties to sort out among themselves how they would like their part of the delegation to be comprised. We certainly will not stand in the way of this amendment. I further add that provision is made for alternative delegates to be appointed in circumstances where a delegate is unavailable. However, the executive committee has recommended, again for the better operation of the Convention, that the number of alternates should be limited to six in the case of the Commonwealth and four in the case of each State. The Government believes that this recommendation should be observed by the Commonwealth and that Government and non-government leaders should exercise restraint by nominating only three alternates each. The Government is hopeful that despite the reversal suffered by the Constitutional Convention in recent years the Brisbane meeting will prove to be a worthwhile exercise. Perhaps it is the last opportunity for the Constitutional Convention to prove its worth and we will all be hoping that something constructive will emerge from it. Much work of a constructive nature has been done, as I and other senators here can testify, in the Convention sub-committees since the Adelaide meeting and there is a full agenda for Brisbane. The modest achievement of three referendum successes in 1977 shows that progress is possible on a wide range of issues if a cross-party approach to constitutional reform can be developed and maintained. There is much I could say on this theme in the light of recent history but I do not think that the speedy passage of this motion would be facilitated by my doing so. I simply indicate that constitutional reform remains an important priority for this nation and I, on behalf of the Government, certainly look forward to cross-party co-operation in achieving it. I commend the motion, with Senator Durack's foreshadowed amendment, to the chamber. Senator DURACK(Western Australia)(10.25) —The Opposition is, of course, entirely in support of the basic thrust of the motion that has been moved; namely, that this Commonwealth Parliament should participate in the Australian Constitutional Convention which is to be held at the end of July this year in Brisbane. This will be the first plenary session of that Convention since the Convention which was held in Adelaide at the end of April 1983, just over two years ago. At that time an offer was made by the Queensland Government to hold the next plenary session in Brisbane in 1985. Even though the Government seemed to have had a fit of pique after the failure of the referendums on 1 December, and at that stage was talking about abandoning the Convention, the Opposition is pleased that the Government decided in the end to continue its support for the Convention. A great deal of work has been done by a number of committees which were established as a result of the Adelaide Convention. Very extensive valuable reports have been prepared and will be available for the next Convention. In my view, the forthcoming Convention in Brisbane will be better informed, by these reports, than previous Conventions have been, although I do concede that there have been valuable reports at previous Conventions. One of the achievements of the Adelaide Convention was the establishment of a number of special sub-committees to study various subjects. The support which has been given by governments, members of the Convention and members of those committees to that work has been an outstanding feature of this whole process of constitutional reform through the Convention; a process which this Opposition, both when it was in government and now in opposition, has supported. The Minister for Energy and Resources, Senator Gareth Evans, has referred to the fact that amendments have been made to the Constitution as a result of these Conventions and that is always to be seen as a possible achievement for any Convention, but it does have a wider value than that. A number of steps can be taken by governments to improve the working of the Constitution short of actually having constitutional reform. Discussion about constitutional reforms is another valuable aspect of the Convention process, so there are good and sound reasons for continuing the Convention. I forbear from debating with Senator Gareth Evans why the Government failed last year with the referendums, but the mere fact that some referendums fail is no reason why the process should be abandoned. Senator Robert Ray —Trust is alive and well in 1985. Senator DURACK —If Labor senators want to start a debate, I am very happy to have it. I will not stand here and be provoked by Labor senators who were largely responsible for the miserable performance of the Government on constitutional reform because of the backing and filling that went on in the Government last year. I am happy to call it quits on that. I warn Labor senators that any more interjections or comments on that matter will provoke me to a lengthy speech. The commitment of the Government to the Convention is not as strong as its rhetoric might have led us to hope. The way in which this motion is being dealt with is a good example of that. The Opposition supports the Government's commendable restraint in negotiating for smaller delegations for this Convention. I think it will help the process of the Convention to have fewer people present, and it is also a sensible financial saving. Apparently, all participating governments have agreed with this proposal. The Commonwealth delegation, which at previous conventions amounted to 16, is to be reduced to 12. The Opposition supports that. The Opposition believes that as the Australian Democrats were represented at the last Convention in Adelaide they should also be represented at this Convention. Our only problem lies in the proposed division of the 12 members of the delegation between the two Houses. The Government waited until right at the death knock of this session to bring forward this motion or even to give notice of it. It was introduced in both chambers at a late hour on Monday night. Of the 12 delegates, it provided that eight should come from the House of Representatives and only four from the Senate whereas, under the previous arrangement, of a delegation of 16, 10 came from the House of Representatives and six from the Senate. This proposal has created a disproportion between the proposed representation and that which the Senate enjoyed in the past. Although the Executive Committee resolved some months ago that there would be fewer members on the delegation, the Government managed to get around to putting this proposal to the Parliament in the last week of the sittings of the House of Representatives. It did this at a late hour on Monday night and then expected the Opposition to deal with the matter yesterday. Unfortunately the Government insisted on proceeding with this matter in the House of Representatives and passed the resolution in the form to which the Opposition objects. I appreciate Senator Gareth Evans's co-operation in having the matter deferred in the Senate until it could be resolved. We have achieved that now. The Opposition has proposed that the membership break up between the two Houses will be seven from the House of Representatives and five from the Senate. So the Opposition will have one less representative from the House of Representatives and one more from the Senate. That is the purpose of the amendments that I propose to move. They have been circulated. I do not propose to read them out, but that is their effect. In the light of the message we have just received from the House of Representatives, after the final paragraph of the motion moved by Senator Gareth Evans dealing with the transmission of a message to the House of Representatives, we should add the words 'and requesting the House to reconsider the resolution transmitted to the Senate by message No. 111'. This message has recently been read to the Senate by the President. For the reasons that I have outlined, I seek leave to move four amendments together. Leave granted. Senator DURACK —I move: (1) Paragraph (1) (a), leave out '4', insert '5', leave out '8', insert '7'. (2) Paragraph (1) (b), leave out '4', insert '5', leave out 'one member', insert '2 members'. (3) Paragraph (2) (b), leave out 'one Senator being a member', insert '2 Senators being members'. (4) Paragraph (8), at end of paragraph, add 'and requesting that the House reconsider the resolution transmitted to the Senate by Message No. 111'. Senator MACKLIN(Queensland)(10.34) — The Australian Democrats support the motion moved by the Government. We agree with the rearrangement that the Opposition proposes regarding the composition of its representation on the delegation to the Australian Constitutional Convention. I believe that the decision of the Executive Committee, of which I am a member, almost two months ago to reduce the numbers on the delegation will facilitate the operations of the Convention. I must admit that I am nowhere near as sanguine as Senator Gareth Evans or Senator Durack as to the possible outcome of that Convention. Having in mind the operation of the Adelaide Convention, I think one must approach the Convention in Brisbane with a great deal of fear and trepidation lest, by holding such a convention, we put back the cause of constitutional reform rather than advance it. I hope that this time around people will be more reasonable and more sensible in terms of what goes on and also that they will actually adhere to the resolutions once they are passed rather than proceed to campaign against them. That type of exercise not only brings the Convention into disrepute but also brings political life in Australia into disrepute. It is little wonder that following such exercises the people of Australia vote against any type of referendum that comes up on the basis that the whole thing looks like a cynical exercise in power manipulation. I would hope that if there is a sensible debate in the Convention and if certain resolutions are supported by the majority of people there, those who have voted for them on the floor of the Convention will actually proceed to convince their own parties to support those resolutions out in the electorate. Ultimately that will be the only way in which any exercise in constitutional reform in this country will be able to take place. There is a fair amount of unease that the Convention as it is currently structured, made up entirely of politicians from parties that themselves have vested interests not only in regard to constitutional change but also in regard to election matters, probably will be unable ultimately to come up with a satisfactory resolution of the types of constitutional problems that Australia faces. So some type of restructuring of the Convention is probably in order. It is interesting to see that the Government itself has moved from the position it took while in opposition to one which is more accommodating of viewpoints other than political viewpoints put forward at Constitutional Conventions. The Brisbane Constitutional Convention will probably be the make or break of any activity in this area. If the performance of Adelaide is repeated in Brisbane there will probably not be another Constitutional Convention held during the lifetime of anyone here. I say that for one very good reason: To further perpetuate that cynical exercise would do untold damage to the aspirations of the Australian people to bring their Constitution constantly up to date when new problems are met. Unfortunately we have built up in Australia the view that the Constitution must be left entirely alone. I believe that that is totally unsatisfactory. The Constitution was written before the types of communications and transport system that we all know so well and accept as ordinary parts of our lives-I refer to the advent of radio and television as mass media, the supply of telephones to every home and the use of aeroplanes-had come into operation. In other words, we have a totally different type of society now to the one we had when our Constitution was drawn up. With all respect to the people who did draw it up-it has served this country well-there are things that they were not at that stage able to take into account. For example, the Governor-General, whilst having control over the army and the navy, in fact does not have control over the air force simply because there was not an air force at the time the Constitution was drawn up. The country moves on, history moves on, and because of that it is necessary for the Constitution to change to take account of that. Some unfortunate situations have arisen. For example, in Adelaide there was another excellent debate on the operation of laws governing the custody and control of children and the breakup of marriages. That related particularly to the custody of children following a marriage breakup. We had innumerable lists of decisions of the High Court of Australia, the Federal Court of Australia and lower courts indicating that the law in this area is an absolute mess, that people's lives are being dragged through one jurisdiction after another with no regard to the individuals concerned and certainly with no regard to the children who have been massively disadvantaged by our inability to agree about who has jurisdiction in certain areas. Whilst there was an excellent debate, absolutely no action was taken and nothing was followed through because it seemed that if any follow-through were to take place it would have been actively opposed in the context of an election campaign. I presume that the Government has learnt its lesson at least on one thing-it will never again hold a referendum in conjunction with an election. I suppose if we can put down the enormous cost of the campaign and say we have learnt something from it, that at least is useful. I sincerely hope that the Convention in Brisbane will be a genuine attempt by the people going there to bring about some agreed position in this area, but I must say that in my heart of hearts I have little hope at all of that occurring. Senator MISSEN(Victoria)(10.40) —At this stage it is obviously game, set and match so far as the Constitutional Convention is concerned. The Opposition has agreed with the Government, and the Australian Democrats are happy with their one person on the Convention and we will now go along with this with a whistling of hope which Senator Macklin has given us. I think, honestly, that he has also given us reasons for a great deal of doubt about whether it will happen. I make a few comments about this matter, even though it appears to be too late, because we are here concerned with a motion which will reduce the Commonwealth contribution to 12 people instead of 16-which should be no great cause for cheering in the streets-and even that is to be split up 7:5 between the House of Representatives and the Senate. The Opposition has agreed to that. Senator Macklin —The State delegations have been reduced too. Senator MISSEN —Yes, but not, I think, to the same degree. Senator Macklin —Yes, the same degree. Senator MISSEN —The same degree. Well, we have fewer people looking at the whole question of constitutional change, and therefore there will be a smaller variety of views among the people considering this matter. I do not regard that as a reduction of any value. If it were a reduction which allowed people to be elected to the Convention so that there were worthwhile representatives, from outside the parliaments, it would be worth reducing it. But that is not happening. In fact, it will be just a more cosy gathering of State and Federal members getting together and chloroforming the problem of constitutional reform. That is what I think it will do. Senator Macklin —We could not convince your Government and we have not been able to convince this Government. Senator MISSEN —No, I know that we have not been able to convince them, and I intend to plug on trying to convince the people of this country that we need at least an elected component of people who are elected because they are interested primarily in constitutional reform and not just interested because they are members of parliament and are able to have a weekend away every two or three years to discuss these matters. Therefore, I look on the record which the Constitutional Convention has had as being very dismal. On the last occasion on which we passed a resolution in regard to the exchange of powers, it was regarded as an innocuous one, but it was one which the Government completely ruined by bringing it on with an election campaign and using it as a foil for another proposal which was not nearly as popular. That has meant that the resolutions unanimously carried by the last Convention in Adelaide have been totally ignored by the people. So how one can proceed with a Convention of the same type but now with fewer members and expect it to be a success, I do not understand. In my view, the cause of constitutional reform is at a very low ebb, and it is likely to get lower if, as Senator Macklin fears, this Constitutional Convention in Brisbane is unsuccessful. Therefore, I make a plea to the people of Australia to think about having a Constitutional Convention which includes an elected component, which is not just made up of a few members of parliament-and mostly State members at that-and which distorts the idea of representation throughout this country. Little is to be gained by this Convention. So far as the amendment is concerned, apparently a deal has been done whereby the ratio is to be 7:5 between the representatives and the senators. I cannot see why there is not equality of representation between the House of Representatives and the Senate, because the Senate, if anything, has taken a more intelligent view on constitutional matters than has the House of Representatives. I am not claiming that there should be more Senate representatives than there are from the House of Representatives, but I think that there ought to be at least the same number. However, the Opposition has achieved some success in reducing that disproportionate number of 8:4 to 7:5, and I suppose that we must be thankful for small mercies. I certainly do not oppose the amendment or the motion to carry on this Convention in the way that is proposed, but I express the view that this is really a sham in our dealing with constitutional change and that we are not achieving the effect that we might have. It is true that coming from the Convention have been reports of committees which involve excellent work. If that alone were the reason for having the Constitutional Convention, that would be some justification for having it meet every three years, because in the meanwhile its sub-committees are doing some good. But I think it is a very small and inadequate reason. The day must come when constitutional change is looked at sensibly instead of in the stupid way it has been looked at by this Parliament in the last couple of years, over which one must despair. I therefore take the view that we are going ahead with a new convention, having learned nothing for the experience of the last two years. I fear the consequences for constitutional reform in this country. Senator PETER RAE(Tasmania)(10.45) —I support the proposal for the Australian Constitutional Convention and the amendments which have been moved by my colleague Senator Durack. I have greater faith in constitutional review than have other senators who have spoken. I believe it is something which of necessity is slow. It ought to be slow. It ought to be the subject matter of very deep consideration and lengthy debate by those who are concerned to motivate change in the Constitution and to achieve understanding by the general populace of what is likely to be the result of any change proposed. The fate of so many of the earlier proposals for change has been determined by one of two things: Either there has been inadequate prior public debate on the proposals or the proposals have been openly and cynically party political or political in terms of the achievement of political objectives by the executive of the day. The public, God bless them, have had sufficient sense to realise that there have been reasons for concern and reasons for saying: 'No. Let's wait and hear a little more about this proposal'. I believe we have succeeded, in a short period, in having a greater number of amendments made to the Constitution than has been the record previously over the period since Federation, that is, a greater number since the Constitutional Convention came into being. We could have achieved more if we had spent less time on some of the controversial political issues and on the political issues which would have had advantage to an executive, to one House, to one parliament or to one section of government. There is a large cross-section of areas for review. As my colleague Senator Missen has said, the committees of the Constitutional Convention have done a great deal of very valuable work during the periods between the holding of convention. That forms part of the ongoing consideration and debate which I regard as so essential an aspect of constitutional review. I do not adopt the term used, for instance, by the Minister for Resources and Energy, Senator Gareth Evans, when he talks about constitutional reform being necessary. I regard constitutional review as necessary. What is necessary within our total populace, within our democracy, is that we keep our Constitution under review and that the public be aware of those areas where some change may be needed, where there is debate as to whether change should take place. That should be distilled, as a result of the process of public debate, into a consensus view whereby a majority of people in a majority of States are prepared to support the change. History has shown that it is possible to have sensible and desirable change take place. A number of constitutional amendments could be put up at this stage which would effect improvements to the Constitution and which would be carried without any difficulty. The proposals that do not get carried are those that are cynical. When a proposal for an amendment is put before the people of this country which has the history of, for instance, the proposal which has been the most controversial and which has been put backwards and forwards by various parties for what may be seen to be the advantage of the executive of the day, it is no wonder that the public of Australia have expressed their concern and their querulousness about it. I simply wish to support warmly the desirability of the ongoing constitutional review process. I hope that it does not falter. I hope that people who are anxious to see a speedy change do not lose heart and, because we have not been able to achieve a magical reform either by 1988 or some other time, pack up and go home and leave the process altogether. It is desirable that the Constitution be reviewed. It is desirable that the review take place after full public consideration and full public debate and upon the basis of what is seen clearly to be a desirable change. So that we can identify these matters, it is desirable that the Constitutional Convention provide a focus and forum for that review on an ongoing basis. I warmly support the continuation of the Constitutional Convention. Amendments agreed to. Motion, as amended, agreed to. Debate resumed from 13 May, on motion by Senator Ryan: That the Bills be now read a second time. Senator DURACK(Western Australia)(10.51) —The Senate is debating cognately the Excise Tariff Amendment Bill 1985 and the Customs Tariff Amendment Bill 1985. These Bills propose to amend the Excise Tariff Act and the Customs Tariff Act. I will deal, firstly, with the amendments to the Excise Tariff Amendment Bill. The Opposition is entirely in support of the proposals in this Bill. It proposes a number of alterations to the Excise Tariff Act, the principal one being the introduction of a new intermediate excise duty scale for crude oil. It also alters the rate of excise duty payable on liquefied petroleum gas and on fortified spirit. These alterations, particularly the latter one, give effect to earlier Budget decisions. I do not propose to take up the time of the Senate today going over that ground again. However, the introduction of the new intermediate excise scale for crude oil is important. The crude oil levy has been a major aspect of the import parity pricing policy which was introduced by the Fraser Government and has been continued by the present Government. It has been a major source of revenue for governments for some years. The crude oil levy was originally introduced when the import parity pricing policy was adopted, to prevent the windfall profits which would have been received by the oil companies. These profits were creamed off and taken in the form of revenue by the Government. The method by which that was done was the crude oil levy. At the time of the introduction of the import parity pricing policy there was a very large discrepancy between the price that had been received by Australian crude oil producers and the world price of oil because of the oil shocks in 1973 and 1979. In order to correct the major windfall in profits that would have been received the excise duty was struck at a very high rate. I think the highest rate is about 87 per cent. The result was the very large revenues which governments have been receiving and are still receiving. Indeed, in the current year the crude oil levy will return about $3,700m to the Government. This is a very sizable share of revenue. As a result, a number of oil fields were subjected to that very high rate of levy. Pools of oil which had been discovered and which were subjected to that tax were simply not economic to develop. They were just left lying there and were being wasted because of the excessive nature of the levy. This particular proposal introduces what is called the intermediate rate which is a significantly lower rate, although it varies in scale. The maximum level is 55c a barrel. This has already resulted in the major oil producers of Bass Strait investing heavily in the development of a number of these pools of oil which were not commercial propositions under the previous scale. They plan to invest a total of nearly $2 billion in the development of those pools. This will greatly increase Government revenues as well, but it is also a very profitable transaction for the oil producers. This is a satisfactory policy and one which the Opposition certainly supports. I take the opportunity of mentioning that at the time that this was evolved the Government also abandoned the previous Government's policy of applying no excise or levy on new oil discoveries. That had been a very important feature of the import parity pricing policy of the Fraser Government in that although a high levy was struck on oil that had already been discovered, there was to be no levy on new discoveries or what is called new oil, both off-shore or on-shore. Because of that policy we had the very high level of exploration for oil both off-shore and on-shore in the late 1970s and early 1980s. Australia's self-sufficiency in oil was forecast to run out in the mid-1980s. Back in the late 1970s it was assumed that our self-sufficiency would last only until the mid-1980s. That has been extended into the early 1990s. The introduction of a new oil levy takes some of the shine off the incentive to explore for new oil. The Opposition is very concerned that the Government introduced that levy. It did that by separate legislation; it is not part of this Bill. I mention it because although we are welcoming this provision in this Bill we are not happy at all with the Government's approach to the exploration for oil. Another example of that approach this session was the Government's proposal for cash bonus bidding for new oil exploration or new oil leases to be granted in the future in some areas. The Government was apparently banking on that as a revenue raising measure. It will raise another $40m or $50m from that levy. We are still awaiting the full details of the Government's resource rent tax proposals which were announced a year or so ago. They created a good deal of concern and uncertainty in the industry and are having only a negative effect on the exploration for oil. Although we support this measure we certainly express our opposition to and concern about other aspects of the Government's oil industry policy. I turn to the Customs Tariff Amendment Bill. The amendments to the Customs Tariff Act are very extensive but the Opposition will support most of them. In summary, changes include giving effect to recent reports by the Industries Assistance Commission on separate articles direction No. 1; Government policies in relation to textiles, clothing and footwear; the motor vehicle plan and the steel plan. There are also a number of administrative amendments, the implementation phasing duties under the closer economic relations policy with New Zealand and some tariff simplification and the updating of the names of certain countries that are accorded preferential treatment in the Customs Tariff Act. There is one segment of the Bill dealing with certain consumer electronic equipment with which the Opposition has some concern. We believe this should be referred to a Senate committee for further investigation. In relation to most of these proposals, the Bill will result in a reduction of protection and a simplification of the tariff. Without going into details, the Opposition, for those good reasons, will support it. The Government has decided to remove the 2 per cent revenue duty on components for use in ship repair and construction, which is subject to bounty provisions. This could be beneficial to the shipbuilding industry, which has been declining over a number of years. The Fraser Government introduced a bounty for that industry but under the bounty the expected rationalisation did not occur. There has been amended bounty legislation which it is hoped might alleviate this problem. The removal of the 2 per cent revenue duty will reduce the industry's costs and should help to make it more competitive. I do not propose to debate again the textile, clothing and footwear policies which are implemented by this provision, the motor vehicle plan or the steel industry, except to say that the Opposition supports the provision that have been made in this Bill. I turn to those provisions with which the Opposition is not happy-indeed it is concerned sufficiently to suggest that they need further consideration by the Senate Standing Committee on Industry and Trade. We believe that there should be a report by that Committee in respect of colour televisions sets, which are dealt with in these provisions. Again, this has been the subject of an IAC report and the Government has endorsed the thrust of the IAC recommendations for most of the goods that were under reference. However, it rejected a specific recommendation on colour television sets. The Government decided to increase duty on colour television sets from 35 per cent to 50 per cent for one year and then phase it down to 20 per cent after three years; to introduce a quota of 50,000 on colour television sets measuring 47 centimetres or more when measured diagonally across the face of the picture tube; to introduce a concessional rate of duty of 30 per cent on quota imports; and for colour television sets less than 47 centimetres, to introduce a 25 per cent duty on implementation, phased down to 20 per cent after three years. The overall effect of the Government's decision is the reduction of protection for all goods that are the subject of this category, but in the case of colour television sets of 47 centimetres or more, this reduction in protection will occur only after an initial increase in tariffs plus the quota. The imposition of the quota is designed to ease possible adjustment effects following the cessation of licensing agreements and a voluntary export restraint agreement with Japan. Although the industry generally supports the Government's decision, there is concern that the measurement criterion of the 47 centimetres diagonally across the face of the picture tube for quota purposes is not in accordance with international standards, which measure screen sizes according to viewable screen diagonal. So the effect of this definition will mean that 18-inch colour television sets will now come under quota whereas they were excluded under the previous voluntary export restraint agreement to which I have already referred. From the evidence available to the Opposition it appears there is a case for an alteration in the definition of the measurement. We are concerned about the effect of this and so is the industry. We think it is suitable for a reference to and quick report from the Senate Committee, which should investigate the facts of this matter. For those reasons the Opposition will move an amendment to the second reading motion in the terms that have been circulated. That amendment will have the effect of referring the Bill to the Senate Standing Committee on Industry and Trade. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(11.08) —I note what Senator Durack has said about the Excise Tariff Amendment Bill and I do not think there is much that I can add, except to say that our sentiments are probably different. Nevertheless, I thank him for the Opposition's general support of that Bill. It may be appropriate for me to wait until the foreshadowed amendment to the Customs Tariff Amendment Bill is moved before I deal with it. I understand that the Opposition otherwise supports the Bill. The DEPUTY PRESIDENT —The Minister may speak to that now if he wishes. Both Bills are before the Chair. Senator BUTTON —As long as the Opposition spokesman regards himself as having dealt with the amendment. Senator Durack —Yes. The DEPUTY PRESIDENT —The only matter remaining for Senator Durack is, as I understand it, to formally move the amendment. Senator BUTTON —The Opposition has indicated that it generally accepts and supports the provisions of the Customs Tariff Amendment Bill. The question of the so-called capture of 18-inch colour television sets in the tariff quota has been the subject of a specific amendment. I wish to make it clear at the outset that the Government does not accept that amendment. This issue has been very carefully examined by the Government. I think Senator Durack said in a moment of inadvertence that the industry supported his amendment. I am not sure whether that is correct. Senator Durack —I said that it was concerned with that provision in your Bill. Senator BUTTON —I am concerned about what Senator Durack means by 'the industry'. I concede that perhaps one or two companies may have expressed concern but I do not think that that means the industry is concerned. In fact, I think the industry is well satisfied with the provisions of the legislation. Any alteration of the quota arrangements at this stage would not be in the best interests of and acceptable to importers and the industry generally, as distinct from perhaps one or two particular complainants. The referral of this question to a Senate committee would resolve absolutely nothing. I do not know whether there is any point in my explaining the technical matters associated with the statistical key which is used in the Customs tariff to determine quota arrangements. However, let me make one or two points. There is no formal definition of an 18-inch set. The term is generic and refers to the approximate diagonal measurement of the tube. Importation of sets having a tube of greater than 47 centimetres was arguably outside Australia's understanding of the application of the voluntary restraint arrangement with Japan. For many years importers have knowingly or unknowingly classified their sets to the wrong statistical key. I make the more important point that any reference to a Senate committee and a changing of the definition of the set subject to the quota would cause up to three months delay in informing importers of their advised allocation of quota and would subject importers and the whole of the manufacturing industry in Australia to unnecessary costs and uncertainty during this period. As the penalty rate of imports outside quota is being drastically reduced, the problem has to be seen in that perspective. The very fact that the quota arrangements have a relatively low penalty rate of duty for import outside quota provides considerable flexibility to individual importers. I make the point that this reference to a Senate committee is suggested in the context of the fact that the quota arrangements expire in October this year anyway. So at the end of May one would have a reference to a Senate committee in respect of a matter which is highly technical, which is not in the interests of the industry as a whole and which would lead perhaps to some deliberation and conclusion by a Senate committee in the Budget session which would not be relevant, in any event, from October when the quota arrangements expire. There is a wide range of other reasons which make this proposed amendment inappropriate. However, the suggestion that a highly technical matter such as this should be referred to a Senate committee is wrong. It is wrong in the implications it would have for industry. It would be highly disruptive. It is wrong because of its timing in terms of the expiry of the quota in October this year. For those reasons the proposed amendment will not be accepted by the Government. The DEPUTY PRESIDENT —By leave of the Senate I will separate the second reading motions of the two Bills. The question is: That the Excise Tariff Amendment Bill be now read a second time. Question resolved in the affirmative. The DEPUTY PRESIDENT —The question now is: That the Customs Tariff Amendment Bill be now read a second time. Motion (by Senator Durack) proposed: Leave out all words after 'That', insert: 'the Bill be referred to the Standing Committee on Industry and Trade for report by that Committee on the designation of colour television sets under reference No. 85.15.11 of Schedule 3 of the Customs Tariff Act 1982 as proposed to be amended by the Bill.'. Senator JACK EVANS(Western Australia)(11.15) —It needs to be recognised that timing is the essence of this amendment. The referral would go to a Senate committee, the Senate Standing Committee on Industry and Trade. It would be considered during the recess. The Committee would report back to the Parliament following the recess and recommendations would come forward either to accept the Government's proposals as contained in the Customs Tariff Amendment Bill or to reject those proposals. Senator Durack —Or propose otherwise. Senator JACK EVANS —Or propose otherwise. As the proposals contained in the Bill only take us through until October it is quite evident that the effect of Senator Durack's amendment would be to deny the Government this Bill. As the Australian Democrats have indicated that we will be supporting the Bill, I believe that to support the amendment would be in contradiction of our general support of the legislation. So the Australian Democrats will not be supporting the Opposition's amendment. Question put: That the words proposed to be left out (Senator Durack's amendment) be left out. The Senate divided. (The President-Senator the Hon. Douglas McClelland) Ayes . . . . . . . . . . . 30 Noes . . . . . . . . . . . 37 —— Majority . . . . . . . . . 7 —— Archer, B. R. MacGibbon, D. J. Baume, Peter Messner, A. J. Bjelke-Petersen, F. I. Missen, A. J. Boswell, R. L. D. Parer, W. R. Brownhill, D. Puplick, C. J. G. Carrick, Sir John Rae, PeterChaney, F. M. Reid, M. E. Collard, S. J. Scott, D. B. Durack, P. D. Sheil, G. (Teller)Guilfoyle, Dame Margaret Short, J. R. Hamer, D. J. Townley, M. Hill, R. Vanstone, A. E. Kilgariff, B. F. Walters, M. S. Lajovic, M. E. Watson, J. O. W. Lewis, A. W. R. Withers, R. G. Aulich, T. Hearn, J. M. Black, J. R. Jones, G. N. Bolkus, N. McClelland, DouglasButton, J. N. McIntosh, G. D. Childs, B. K. McKiernan, J. P. Chipp, D. L. Macklin, M. J. Coates, J. Maguire, G. R. Colston, M. A. Primmer, C. G. Cook, P. F. S. Ray, RobertCooney, B. Reynolds, M. Crowley, R. A. Richardson, G. F. Devlin, R. Robertson, E. A. (Teller)Elstob, R. C. Ryan, S. M. Evans, Gareth Sibraa, K. W. Evans, Jack Tate, M. C. Foreman, D. J. Vigor, D. Georges, G. Walsh, P. A. Giles, P. J. Zakharov, A. O. Haines, J. Coleman, R. N. Knowles, S. C. Gietzelt, A. T. Crichton-Browne, N. A. Grimes, D. J. Teague, B. C. Mason, C. V. J. Jessop, D. S. Question so resolved in the negative. Amendment negatived. Original question resolved in the affirmative. Bills read a second time, and passed through their remaining stages without requests or debate. Debate resumed from 20 May, on motion by Senator Grimes: That the Bills be now read a second time. Senator PETER RAE(Tasmania)(11.24) —The Opposition supports part of this package of Bills, consisting of the Sales Tax Laws Amendment Bill and related Bills, and is concerned about other parts of it. In summary, we believe that there are parts which were foreshadowed by the former Treasurer in the previous Government more than two and a half years ago and which this Government has been somewhat lethargic in taking up, and that there are other parts which are entirely new, the ramifications of which certainly concern a significant section of a significant industry in Australia. We are concerned to see that those parts are properly studied and that the industry has a proper opportunity for consultation before the Bills are passed by this House and brought into effect. We therefore propose a measure which I will outline in detail a little later, by means of which the House could pass the whole of the legislation. We propose that the legislation be divided into those parts upon which we are agreed-those which would overcome fraud and avoidance of existing sales tax requirements and which would come into force immediately-and those parts which would introduce new laws and for which we believe an opportunity for consideration should be given. I believe it is just to say that after this Government's lethargy in relation to sales tax over nearly two and a half years there is now a rush to introduce new sections in what I regard as almost indecent haste. I find it in passing curious that the Government is prepared, through the Minister for Immigration and Ethnic Affairs and Minister Assisting the Treasurer, Mr Hurford, on behalf of the Treasurer (Mr Keating), to see at I think 4.30 this afternoon sections of the industry concerned. He has an appointment to see them to discuss the problems in relation to the proposals, yet the Government wants these Bills to go through before the industry has had a chance to make its representations to the Government in relation to the problems it sees, which I will explain in a moment. Let me go through the package of Bills and give an overall explanation of them as I understand them. They will curtail certain sales tax evasion practices that have developed by the misuse of sales tax certificate numbers allowing people who should not be able to purchase goods tax free to do so. This evasion practice is presently estimated to cost up to $200m annually. The Opposition supports the measures which are proposed to prevent that from taking place. There is no question about it, we wholeheartedly support that. The Bill will close off a practice whereby wholesalers who technically become retailers under an agency of a similar retail selling plan and avoid paying sales tax on their wholesale profit margin and any royalties payable-that is, pay sales tax on their purchase prices, not their selling prices and thus pay less sales tax than they should. These are measures which aim to ensure that the wholesalers pay a fair wholesale market value on goods sold under such arrangements known as agency schemes and floor-plan arrangements. It is estimated that this practice also involves revenue losses of the order of $200m annually. The measures also will implement a number of reforms to the sales tax system which the former Treasurer foreshadowed in August 1981. They include enabling the Commissioner of Taxation to recover up to $1m in sales tax avoided by manufacturers who, since that date, have sought to take advantage of a weakness in the present definition of the word 'manufacture' and putting an end to certain avoidance schemes where royalties payable are excluded from the sale value of goods and tax is not paid on them. The cost to revenue has been estimated at approximately $25m and the legislation will prevent further losses. I do not think I need to take up the time of the chamber in dealing with the misuse of sales tax certificates, but let me summarise by saying that the Australian Taxation Office claims that more often than not the vendors turn a blind eye to the false quotations which are given. The measures in this Bill to prevent this include: The level of security for compliance with the conditions of registration is to be increased to a maximum of $25,000 from the present level of $2,000, which was set some 55 years ago; the Commissioner will be able to call for security if he thinks revenue is at risk; the Commissioner will be given the power to refuse or revoke a sales tax registration where the information is false or misleading or where security is not provided when required; the Commissioner will be able to withdraw permission to quote if he believes the procedure has been abused by the person in the past; the Commissioner will be able to publish a list of those who have had their certificates revoked, et cetera; and the vendor will need to be satisfied that the purchaser is a registered person, that the quotation is authorised by law, that the quotation is not false or misleading and that the Commissioner has not notified that the certificate number has been revoked, and if the vendor sells the goods tax free despite having reasonable grounds to believe that any of the above grounds were not met the vendor will be liable to pay the tax. In relation to this there may be some practical difficulties with regard to the onus of proof and other matters. I believe that at the Committee stage we need to pay some attention to certain aspects of the way in which notification will be available to people so that they can obtain the information which they are required to have to ensure that they do not place themselves in a position of being liable to pay tax. I now refer to sales tax minimisation by indirect marketing methods. The sales tax law is structured so that the sale to the retailer-that is the taxable sale-is for a price that includes all the costs incurred by and the profit margins of each party in the distribution chain up to, but not including, the retailer. Indirect marketing arrangements seek to eliminate the wholesaler's profit margin from the sale value of the goods. One arrangement-an agency arrangement-moves back the point in the marketing chain at which the taxable sale takes place. This arrangement eliminates the wholesaler's profit margin from the sale value of the goods sold by retail and the sales tax payable is, accordingly, that much lower. In another equally artificial retail marketing arrangement the wholesaler could acquire an interest in a section of a traditional retail store from which goods might be sold direct to the public. Again, the wholesaler technically acquires the mantle of a retailer and the wholesaler's profit margin is not subject to sales tax, as it should be. In practice, indirect marketing arrangements mean that goods can be sold to the public at considerable savings in sales tax. Those who engage in these arrangements can therefore achieve an unfair competitive advantage in the market-place, to the detriment of the revenue and those taxpayers who, on principle, choose not to be a party to such arrangements. On the other hand, some businesses have, for many years and for genuine commercial reasons, sold their goods to the public through indirect marketing arrangements, such as agency arrangements. Although sales tax reduction is not a motive for these agency sales, the revenue is affected in precisely the same manner and to the same extent. The Bill proposes to counter these practices by inserting a new definition of the words 'wholesale merchant' which includes as wholesalers those who sell goods by retail under an indirect marketing plan. In this way a deemed fair wholesale mark-up in such cases will be included. Other measures are the measures to tighten up to which I have referred. The main area of concern which we have about this large and complex package is that a considerable section of the industry involved believes that it has reasonable grounds for concern as to the impact which the legislation will have on legitimate business. Whilst cleaning up business which, it is agreed by everybody, pursues undesirable practices and tax avoidance measures, the legislation could also have a major impact on direct selling-one of the major growth areas in the retail marketing sector. That is not, possibly, the intended impact, but it could put out of business a number of major sectors of industry to which I will refer in a moment. So, the problem is the practical implementation of the measures. We express our concern that not sufficient opportunity has been given to legitimate business to express its concern to the Government and other people involved in the consideration of this legislation, including the Opposition, the other non-government party-the Australian Democrats-and the Independent senator. One expression of very considerable concern comes from within the recording industry. Basically, that industry, representing the record and tape manufacturing interests, believes not only that the whole industry, employing some 2,500 people in the manufacturing and marketing sector, is in jeopardy but also that significant sections of it could fold completely if this legislation is implemented in its present form. That industry's concern has been expressed in telegrams, telexes and written representations which have been made in the past few days. As I mentioned earlier, only later this afternoon will it be given by the Government a chance to put its case to the Government. By that time, if the Government's program is achieved, these Bills will have been through the Senate and they will already be law. Further representations have been made by the Direct Selling Association of Australia, which has expressed its extreme concern. It says that, whilst it does not hold with fraud and the fraudulent misuse of the sales tax provisions, it believes that the present method of implementation will destroy the direct selling industry in the process. I will quote briefly from today's Australian to give some idea of what we are talking about. On page 14 an article headed 'Direct Marketing. Age of sophisticated sales' states: Direct marketing across the world is outgrowing and, in many instances, out-performing traditional methods of promoting corporate products and services in the marketplace. . . . A growth rate of 25 per cent is expected to be attained this year through established clients expanding their budgets and also those which have been lured by direct marketing. Manufacturers and people in the industry are gearing up for a major expansion of a new and vital part of the retail sector. They believe that they will be adversely affected very seriously as a result of the way in which these measures are being implemented. A paper which I believe summarises the situation extremely well-because it has been well considered I will read it rather than summarising the situation myself-has been prepared by Arthur Young and Co. It is headed 'Indirect Taxes Bulletin' and dated 10 May 1985. It summarises the major sales tax changes. Under the sub-heading 'Indirect Marketing Arrangements' it states: The Sales Tax Laws Amendment Bill 1985 introduces a new concept of 'indirect marketing arrangement'. Essentially, the relevant amendments are designed to impose a new sales tax on the retail sale of goods sold through such an arrangement. This legislation will take effect from the date of Royal Assent. Although the Treasurer has identified two arrangements on which the legislation will impact, that is 'agency' arrangements and what he refers to as 'floor plan' arrangements, the new law will impact on many retailers not currently liable to sales tax and is clearly designed to significantly boost the revenue. The new legislation extends the definition of 'wholesale merchant' to 'a person who sells goods under an indirect marketing arrangement'. A new sub-section 3 (4A) in Sales Tax Assessment Act (No. 1) will define an indirect marketing arrangement in the following way:- 'A reference in this Act to a person selling goods under an indirect marketing arrangement is a reference to a person (in this sub-section referred to as the 'vendor'), who is not the manufacturer of the goods, selling goods by retail- (a) under an arrangement that provides, directly or indirectly, for the sale of goods (whether ascertained or not) by the vendor through another person acting for and on behalf of the vendor, whether in the name of the vendor or in any other name, but not being an employee of the vendor; or (b) from premises that- (i) are used principally for the sale of goods by retail by any other person or persons; and (ii) are held out to be premises of, or used by, the other person or persons.' A person who is a wholesale merchant by virtue of selling goods under an indirect marketing arrangement will be required to be registered for sales tax purposes and to pay sales tax in respect of retail sales on a sale value determined as the amount which would be the fair market value of those goods if sold by him by wholesale. The amending legislation, as presented by the Treasurer, is incomplete and requires complementary amendments to the Sales Tax Regulations, as foreshadowed in the Explanatory Memorandum. The impact of this legislation is, again, very broad. Every retailer who sells goods through agents or independent representatives (not being employees) may be required to be registered and to pay sales tax in respect of his retail sales. Similarly, a person who sells his own goods by retail from another person's retail premises may be deemed to be a wholesale merchant and required to pay sales tax on his retail sales. Mr Keating has introduced this new sales tax on retail sales under the general banner of anti-sales tax avoidance legislation, but it is clearly intended to impose a new tax on many commercial transactions not previously taxed and which were never intended to fall within the ambit of the sales tax legislation. That quote from the paper by Arthur Young and Co. sets out the situation in fairly precise terms. What it boils down to is that we have a situation in which people such as Avon ladies will be adversely affected. In fact, it is claimed-and I am not in a position to make an assessment of the accuracy or otherwise of the claim-that it will put them out of business. It is claimed that Tupperware parties, a well known feature of Australian society and Australian marketing, will become a thing of the past. This will have unfortunate implications for both our social arrangements and the marketing which is able to take place through that method. They are just two examples of the sorts of problems that it is believed will arise. I have here a telegram from the Corporate Affairs Manager of Amway of Australia Pty Ltd. It reads: The proposed Sales Tax Amendment Bill 1985 has recently been brought to our attention together with the fact that the Bill is scheduled to be reviewed in the Senate tomorrow Wednesday May 22nd. As provisions in the Bill would force upon this company an excessive tax burden which would necessarily result in a substantial increase in the price of our products, jeopardise the occupations of tens of thousands of Amway distributors and threaten the jobs of about 200 permanent employees, we urgently request that you seek reference of the Bill to a Senate Committee for detailed review so that the full impact of its provisions can be properly assessed. That sets out Amway's concern. I do not propose to go through all of the representations that have been made, but just to give some examples. I am informed that overall the direct selling industry has some 120,000 distributors in Australia. There has also been a large investment by people who have tooled up factories to produce goods and staffed offices under the development to which I referred and which is referred to in the Australian today. This major expansion has taken place in this area of retailing in Australia. The records industry has also made representations. I read a telex which I received from the Executive Director of the Australian Record Industry Association. It states: The Australian record industry urgently requests your support in opposing passage of this Bill in the Senate until opportunity to consult with record industry regarding seriously damaging effects of legislation on our industry and ancillary industries. Legislation as drafted will create destructive long and short term problems for the industry including: 1. immediate increase in price to consumer of up to 25%. 2. irreparable harm to TV record companies . . . and direct mail companies . . . budget record companies and record clubs. 3. legislation will inevitably lead to loss of employment in the record manufacturing industry and ancillary industries. 4. damage to the industry would severely jeopardise the development opportunities of local recording artists and composers. Given the damaging effects of this legislation the record industry is dismayed at the absence of Government-industry consultation which could reasonably have been expected to precede such legislation. ARIA has consistently adopted the view that sound recordings as 'culture carriers' should not be levied at the luxury level of 32.5% for the purposes of sales tax. In levying this amount the Government discriminates in its treatment of sound recordings when compared to other cultural items such as books, sheet music, musical scores and films. Given complete lack of consultation by the Government on this damaging legislation, the record industry urgently requests that representatives of the industry be given the opportunity to discuss the legislation with you before it is enacted. I indicate, as I have indicated before and will indicate again, that I do not believe that we are in a position to assess accurately and in detail, with the notice we have had, whether the claims are valid, or the significance and ramifications of what has been put forward to us. These are matters which the Government, had it been more diligent, could have introduced in time for the industry to be consulted and to make representations. I read from a telex from the Record Retailers Association, which states: On behalf of Australia's 2,500 record retailers, we wish to register our deepest concern regarding the introduction of the above legislation. That is, the Sales Tax Assessment Bill (No. 10). It continues: If it is passed not only are our members livelihoods affected but also the very existence of the entire music industry including record companies, manufacturers, recording artists, publishers, printers, and writers. The total music industry employing tens of thousands of people is in jeopardy. We request you meet representatives of the music business to discuss the drastic repercussions from such a Bill. I give one other example from a different section of the industry, and that is a telex from the General Manager of Jafra Cosmetics, which states: Am amazed firstly at the direction and secondly at the speed with which the Government is proceeding regarding the Sales Tax Laws Amendment Bill 1985. As a company which provides income for technically untrained people from all walks of life we respectfully ask that you consider the serious implications to these people's livelihoods. Representation will be made through the Direct Selling Association of Australia. Please grant them a hearing before taking further action. That is what the sections of the industry which are affected have been asking us all: Can they be heard before these Bills proceed? The answer from the Government is yes, they can be heard, but after the Bills have proceeded. The Opposition does not believe that is good enough. Senator Grimes —I bet you don't believe all those claims you have just read out. Senator PETER RAE —I am not expressing a personal view of acceptance or otherwise of every claim that has been made. What I am objecting to is that I have not had the opportunity to consult and find out whether I should accept all of the representations that have been made, or parts of them, or none of them at all. I believe we have within this Parliament a system whereby in such instances we can permit people who are genuinely concerned about the ramifications of legislation which comes before the Parliament to have an opportunity to be heard and to put their case. That is what the Senate committee system is for. That is why we have a legislative and general purpose standing committee system; so that we can refer Bills to committees to be considered and reported upon by people who have had the opportunity to consider the ramifications. I find it a matter of great concern that this industry, significant as it obviously is, employing large numbers of people in Australia, which has very large investments and very significant implications for various aspects of other socio-economic activities in the country, will not be heard before the Government proceeds with the Bills. We have attempted to provide a solution. I foreshadow that in the Committee stage I will move amendments firstly, to enable the whole of the legislation to be passed and secondly, to differentiate between the commencement dates of the legislation. That is not something novel which I propose. There are already within this legislation differentiations between the commencement dates of various portions of it. We propose that those parts which deal with the avoidance, as to which notice has been given, should commence as proposed; retrospectively, either from the date of the announcement or the date of the passage or proclamation. The other parts, on which concern is expressed in relation to the ramifications, which I have not dealt with at any length because I do not have time-that is, the royalties aspects and indirect or direct selling aspects-should come into force by Act of Parliament. The Bill will be passed but the coming into force of those parts on a certain date will require a further Act. In other words, what we are proposing is rather different from a sunset clause; it is a sunrise clause. We propose that the legislation be considered after it has been approved and that the date on which it will come into force be subject to the approval of both Houses of Parliament. That would enable those parts of the Bill which have caused concern to be referred to the Senate Standing Committee on Industry and Trade for consideration and report. If the Opposition amendments are supported, I propose to move a motion which I foreshadow, that the following matter be referred to the Standing Committee on Industry and Trade: The provisions of the Sales Tax Laws Amendment Bill 1985 relating to sales tax on royalties and on goods sold through indirect marketing schemes, and the provisions of the Sales Tax Assessment Bill (No. 10) 1985, the Sales Tax Bill (No. 10A) 1985, the Sales Tax Bill (No. 10B) 1985 and the Sales Tax Bill (No. 10C) 1985. The notice of motion which was circulated in my name erroneously refers to the Standing Committee on Finance and Government Operations and should not do so. I take the opportunity to make it clear that I propose that the matter be referred to the Standing Committee on Industry and Trade. The Opposition supports measures to cut out fraud and the avoidance of sales tax. We support the steps which were proposed by us when we were in government. We criticise the Government for being somewhat lethargic in implementing our proposals. We also criticise the Government for proceeding with somewhat indecent haste with the new sales tax measures. Their full ramifications have caused concern to a very significant section of the industry and the possible implications are not necessarily those which were intended by the Government when introducing the legislation. We believe that an opportunity should be given for such matters to be considered after the legislation has been passed but before it comes into effect so that the Parliament will have a report from the Senate Committee to consider before the legislation becomes fully operative. On that basis, the Opposition will support the second reading of the Bill but will move amendments at the Committee stage. Senator WALSH(Western Australia-Minister for Finance)(11.53) —I am not sure whether I should go into the details of Senator Peter Rae's proposed amendments and the Government's response to them at the second reading stage or the Committee stage. There are basically two objectives in the sales tax Bills: Firstly, to end the straight-out sales tax evasion practices through false quotation of numbers, which has the Opposition's unqualified support; and, secondly, to put a stop to the variety of avoidance measures which have recently been detected. The revenue effects if the Bills are passed would be an increase of $200m. The Opposition seeks to defer the implementation of the measures relating to tax avoidance until the Standing Committee on Industry and Trade has had a chance to hear representations from the industry. There has been a good deal of misunderstanding about the way in which the relevant amendments in the Bill would operate. There is, I presume, an inadvertent error in the amendments forecast and circulated by Senator Peter Rae. I do not know whether I should go into this matter now or later on but the effect of the proposed amendments would be to erode entirely, until such time as the legislation was proclaimed, the taxation base for royalties and similar payments. That is because the royalty provisions in sub-section 3 (3) of the Sales Tax Assessment Act (No. 1) are being repealed by paragraph (d) of sub-clause 4 (1), which I think is on page 3 of the Sales Tax Laws Amendment Bill. The Opposition amendments leave the repeal of the existing provision unaffected but defer the enactment of the replacement and tightened up provisions. I assume that that was not the intention, but that, I am advised, will be the effect. Even from a fairly superficial examination and to an untrained eye, it seems to me that that would certainly be the case. That is the most substantial matter. On those grounds alone the proposed amendments would not be acceptable to the Government. Even without that inadvertent effect, the amendments proposed by the Opposition are still not acceptable. Essentially, the tax avoidance practices which have been operating in recent years relate to transfer pricing. Companies not truly at arm's length arrange that the recorded wholesale sales price on which the tax is levied is not in fact the true arm's length price, and the profits are effectively transferred from the wholesale section of a company or a related group of companies into the retail section. Senator Peter Rae —And we support cutting that out. Senator WALSH —Senator Rae has acknowledged that the Opposition supports that principle. There are businesses that quite genuinely operate wholesale and retail components in an integrated way without any intention necessarily of avoiding tax in the process. That seems to have been the substantial point raised in the letters from Arthur Young and from others that Senator Rae quoted. The alarmist predictions of the effect of this legislation, even if it were to operate in the way that Arthur Young and others apparently believe it will, cannot be taken seriously. Those predictions are not endorsed by Senator Rae, who has said that he will reserve his judgment. The alarmist tone of the letters from which Senator Rae quoted reminds me of the alarmist tones of representations which were received by and read out in the Senate about eight months ago when the Government introduced a 10 per cent wholesale tax on wine. The predictions of doom and disaster about the effect of the wine tax on the wine industry have not been realised any more than the predictions of doom and disaster for Amway of Australia and others, and for whole industries, will be realised if the Bill presently before the Senate has the effect that people who sent those letters to Senator Rae believe it will have. The point is that the Bill will not have that effect. Where there is a genuinely integrated wholesale and retail component within a business, it has long been a matter for the discretion of the Commissioner of Taxation to deem a wholesale price upon which tax will be levied. People may raise doubts about resorting to that means of enforcing the sales tax laws, but it seems to me that there is no alternative other than to give the Commissioner the discretion to deem a fair and reasonable wholesale price. By definition it is entirely an in-house transaction and the only other alternative would be to deem that what is intended to be a wholesale sales tax be levied on the retail price. It appears that Arthur Young and the other people who have sent letters to Senator Rae believe that that will happen, but it will not. The sales tax will be levied not on the retail price but on what the Commissioner deems to be a fair and reasonable wholesale price under those circumstances. To go back to the wine industry precedent, precisely that was done for wineries, which are both wholesalers and retailers and in many cases original producers as well. The Commissioner deemed a wholesale price which I understand is generally in the order of 60 per cent to 70 per cent of the retail price. Most of the objections to the immediate implementation of this legislation have been based on the false premise that in the case of a genuinely integrated business the tax will be levied on the retail price. If the enforcement of these provisions is delayed in the way Senator Rae intends them to be delayed, the revenue loss will be of the order of $550,000 a day, based on an estimated total cost of these sorts of avoidance practices of $200m a year. If the unintended effect of Senator Rae's proposed amendments is to wipe out the whole tax base for royalties and similar payments, the revenue leakage will very very much greater than that. It might be possible for Senator Rae to fix up technically the unintended effect of his proposed amendments, but the fact remains that there is an estimated leakage of $550,000 for every day that the proclamation of the amendments in this Bill is delayed. If there were sufficiently sound reasons for taking the action he recommends the Government might contemplate it, but the reasons advanced so far, as far as I can tell, are based entirely upon the false premise that a sales tax will be levied, at whatever the appropriate rate is, on the retail figure instead of the deemed wholesale figure in the case of a genuinely integrated business. Question resolved in the affirmative. Bills read a second time. (Quorum formed) The CHAIRMAN —The Committee has before it six Bills. Amendments have been distributed in connection with the Sales Tax Laws Amendment Bill 1985 and the Sales Tax Assessment Bill (No. 10) 1985. Would it suit the convenience of the Committee if these Bills were considered first? There being no objection, it is so ordered. SALES TAX LAWS AMENDMENT BILL 1985 SALES TAX ASSESSMENT BILL (No. 10) 1985 The Bills. Senator WALSH(Western Australia-Minister for Finance)(12.06) —by leave-I move: Sales Tax Laws Amendment Bill 1985, page 32, Schedule, before the amendment of the Crimes (Taxation Offences) Act 1980 insert the following amendment: Administrative Decisions (Judicial Review) Act 1977 Schedule 1- Omit from paragraph (e)- ''Sales Tax Assessment Act (No. 1) 1930 Sales Tax Assessment Act (No. 2) 1930 Sales Tax Assessment Act (No. 3) 1930 Sales Tax Assessment Act (No. 4) 1930 Sales Tax Assessment Act (No. 5) 1930 Sales Tax Assessment Act (No. 6) 1930 Sales Tax Assessment Act (No. 7) 1930 Sales Tax Assessment Act (No. 8) 1930 Sales Tax Assessment Act (No. 9) 1930'' Substitute- ''Acts providing for the assessment of sales tax''.'. Sales Tax Assessment Bill (No. 10) 1985, page 2, clause 3, lines 1 to 4, leave out the definition of 'goods', insert the following definition: ' ''goods'' includes- (a) commodities; and (b) goods or commodities which have gone into use or consumption in Australia, but does not include goods or commodities in respect of which a person has become liable to pay tax before 10 May 1985 (whether or not the tax has become due and payable before that date) under an Act providing for the assessment of sales tax;'. The amendments are understood, so I seek leave to incorporate in Hansard speeches on the amendments to the Sales Tax Laws Amendment Bill 1985 and the Sales Tax Assessment Bill (No. 10) 1985. Leave granted. The speeches read as follows- SALES TAX LAWS AMENDMENT BILL 1985 This amendment is of a technical nature. The Sales Tax Assessment Bill (No. 10) 1985 (together with the 3 complementary Taxing Bills) will counter certain sales tax avoidance practices concerning the payment of royalties. The proposed new Sales Tax Assessment Act (No. 10) 1985 necessitates a number of consequential amendments of other Commonwealth Statutes that refer to the existing nine Sales Tax Assessments Acts. Clause 61 of the Bill effects these amendments. Under Schedule 1 to the Administrative Decisions (Judicial Review) Act 1977 decisions under certain acts, including certain decisions under taxation acts, are precluded from review through the system of review provided for by that Act. Decisions under the new Sales Tax Assessment Act (No. 10) are also to be excluded from the purview of the Administrative Decisions (Judicial Review) Act, consistent with the position that prevails in relation to decisions under other taxation laws. However, a person liable for sales tax on a royalty who is dissatisfied with an assessment or decision by the Commissioner affecting the sale value of the royalty will have available full rights of objection and appeal ultimately, if the matter warrants it, to the Federal and High Courts. Other taxation laws administered by the Commissioner of Taxation that provide similar rights to contest liability are also excluded from review under the Administrative Decisions (Judicial Review) Act. However, the relevant provision of the Administrative Decisions (Judicial Review) Act 1977 was inadvertently not included in Clause 61 of the Bill and this amendment will correct that oversight. I commend the amendment to the Committee. SALES TAX ASSESSMENT BILL (No. 10) 1985 The Bill as introduced will ensure that royalties paid in connection with the manufacture, sale or lease of goods, but under arrangements that have the effect of excluding such royalties from the taxable sale value of the goods, will not escape the payment of sales tax. The measures contained in the Bill are intended to apply to royalty payments made after 9 May 1985, that being the date the measures were announced when the treasurer introduced the Bill into the Parliament. It has been drawn to the Government's attention that the Bill could have a potentially retrospective operation in cases where royalties are paid in arrears. To the extent that a royalty, paid on or after 10 May 1985, is paid in respect of goods sold before that date, the tax payable on the royalty would not have been recovered as part of the price for which the goods were sold. It is fundamental to the concept of the sales tax that it is 'passed on' to the ultimate purchaser as part of the purchase price. In the situation I have just mentioned the tax on the royalty would, because it was not recovered in the selling price of the goods, have to be borne by the person paying the royalty. It was always intended by the government that these particular measures would operate on a wholly prospective basis. The amendment will, therefore, remove any possible element of retrospectivity. The amendment will mean that the proposed tax on royalties paid in respect of goods will only apply to royalties paid on or after 10 May 1985, where the goods on which the royalties are payable pass the taxing point on or after that date. I commend the amendment to the Committee. Senator PETER RAE(Tasmania)(12.07) —I indicate that the Opposition has had notice of these amendments. They are corrections to matters which are part of the whole package. We have no objections to them other than those I outlined previously. So we will not be opposing these amendments. Amendments agreed to. Senator PETER RAE(Tasmania)(12.08) —I indicated at the second reading stage that I would be moving amendments to the Sales Tax Laws Amendment Bill 1985 and the Sales Tax Assessment Bill (No. 10) 1985. Amendments to achieve the objective to which I referred have been circulated. These amendments enable the whole of the legislation to be passed but change the date upon which those parts of the legislation about which we are concerned, because of their implications on employment and on inflation, because of equity grounds and because of the representations made by a wide cross-section of the involved industry, come into force. We believe that the matters should be given further consideration and that opportunities should be provided for representations to be made and considered. We therefore propose that the Bills be divided into parts as to the dates on which they come into operation. Some parts will come into operation as already proposed-that is, either retrospectively from the date on which it was announced that they would be introduced or from the date of proclamation-and the other parts about which we are concerned will come into operation on a date fixed by the Parliament by an Act. In effect, this forms a sunrise provision which means that although passed their actual operation will not come into effect until a further Act has gone through the Parliament. This will ensure that the Parliament has an opportunity to give further consideration to the general question. If my amendments are accepted the Parliament will have this opportunity after the legislation is investigated by a Senate committee. I have already foreshadowed that I will seek to move a motion to refer the deferred portions of the Bills to the Senate Standing Committee on Industry and Trade so that during the recess period it can investigate those provisions, hear the representations from the affected sections of industry, make an assessment and report to the Senate. Upon the resumption of the Parliament we could proceed immediately with determining whether the Acts come into force immediately unamended or whether some amendments are required in the interests of equity and in the interests of economic efficiency. Finally, I refer to the fact that Senator Walsh said that some unintended effects may arise. I do not think that there are unintended effects, but, as the matter stands, I will move the amendments which have been circulated in my name. I do so with the belief that we shall be legislating to enable sales tax avoidance to be struck down straight away, as it should be, and for revenue to be obtained, as it should be, but, for the areas about which there is some concern, not proceeding with indecent haste and providing an opportunity for the affected sections of the industry to be heard. The CHAIRMAN —Is leave granted for the four amendments to be moved together? There being no objection, leave is granted. Senator PETER RAE —As amendments to the Sales Tax Laws Amendment Bill 1985, I move: (1) Page 1, sub-clause 2 (3), leave out 'shall be deemed to have come into operation on the commencement of the Sales Tax Assessment Act (No. 10) 1985', insert: 'shall come into operation on a date fixed by the Parliament by an Act'. (2) Page 2, sub-clause 2 (4), leave out 'shall be deemed to have commenced to have effect on the commencement of the Sales Tax Assessment Act (No. 10) 1985, insert: 'shall come into operation on a date fixed by the Parliament by an Act'. (3) Page 2, after sub-clause 2 (5), insert the following sub-clause: '(6) The amendments made by paragraphs 4 (1) (a), (c) and (e) shall commence to have effect on a date fixed by the Parliament by an Act.'. As an amendment to the Sales Tax Assessment Bill (No. 10) 1985, I move: Page 1, clause 2, leave out 'shall be deemed to have come into operation on 10 May 1985', insert: 'shall come into operation on a date fixed by the Parliament by an Act'. Senator WALSH(Western Australia-Minister for Finance)(12.11) —Perhaps now that I have had a chance to look at the Bill I can explain what I am advised, and what, even to an untrained eye, seems to be fairly clear is the case, the unintended effect of the amendments would be. Clause 4 of the amending Bill, on page 2, says: Section 3 of the Principal Act is amended-- Then on the next page, at line 19: (d) by omitting sub-sections (2) and (3) and substituting the following sub-sections . . . Sub-sections (2) and (3) in the principal Act are those which established the base for the taxation of royalty and similar arrangements. But independently of that, and for the reasons which I stated in the second reading speech, the Government will not accept the amendments. Senator JACK EVANS(Western Australia)(12.12) —The Australian Democrats will not be supporting the amendments. This is another part of a series of stalling amendments-the reference of matters to various committees of the Senate with the object of ensuring that the implementation of the proposals, which are anti-tax avoidance proposals, would be delayed, thus giving either deliberate or accidental tax avoiders the opportunity to continue to avoid their obligations under the legislation. The message must go out loud and clear from all parties that on the day that a tax avoidance avenue is discovered within our existing tax laws, and from that day forward, there will be legislation to overcome that tax avoidance opportunity. By watering down this Bill by having it referred to a Senate committee, and by giving people time to reconsider and adjust their affairs-whilst it might under certain circumstances be appropriate to help individuals-the overall impact, regrettably, would be to help a great number of people and industries that have-I repeat, deliberately or accidentally-been avoiding their tax responsibilities to the community. For those reasons the Democrats will not be supporting the Opposition amendments. Senator PETER RAE(Tasmania)(12.14) —I thank the Government and Senator Jack Evans, who spoke on behalf of the Democrats, for indicating their intention in relation to our proposed amendments. As to what Senator Jack Evans said, I simply indicate that the Opposition, strongly, clearly and as firmly as we can, joins with him in saying that we believe that when tax avoidance avenues are discovered there should be an immediate announcement by the government of the day that measures will be taken to strike down those opportunities and that those measures should date from the day on which that announcement is made loud and clear. Let there be no mistake: This Parliament is united in that view. In no way do I want what has been said about these amendments to be capable of being misconstrued to indicate that what the Opposition is doing here is giving succour to the tax avoidance that has been taking place. What we are concerned about-this is why I have moved the amendments-is that we believe that there is a case in relation to the innocent and to significant sections of industry which ought to be heard and investigated. Senator JACK EVANS(Western Australia)(12.15) —We need to realise that the passage of these amendments would present the potential for continuing tax avoidance. I repeat, it is not necessarily a deliberate tax evasion scheme that we are talking about; it is avoidance. The estimates have been fairly broad but we are talking about no less than $50m and up to $90m which would be denied to government revenue and which other taxpayers would have to make up in their pay as you earn taxes. They would have to make up the shortfall. We cannot say that we are all united against tax avoiders and that on the day that the tax avoidance means is discovered, and proclaimed to be a tax avoidance means, we will eliminate that tax avoidance opportunity if, at the same time-I am speaking specifically now of sales tax avoidance, Senator Rae-we say: 'On this occasion we are going to put it back a few months and let a Senate committee have another look at it'. Even if this Parliament had the will to make this legislation retroactive, it is not possible to make retrospective sales tax legislation apply. I think that Senator Rae understands that as clearly as I do. No matter what Senator Rae is endeavouring to do by his amendments, we would in fact be enabling a tax avoidance system to continue for a number of months whilst a Senate committee looks at it. Senator PETER RAE(Tasmania)(12.17) —I simply reiterate that the fact that these Bills have been reintroduced in the last two days of the sitting of the House of Representatives is not our fault. I do not propose to accede to the idea that the Senate should agree to having legislation bludgeoned through because the Government, through its dilatoriness, has placed itself in a position where proper scrutiny of the legislation would result in a cost to consolidated revenue. I do not accept the argument that by taking the action that we are suggesting, because the Parliament is not able to sit, there will be a cost. That is not a tenable argument in a proper parliament. If the Government has the need, the Parliament should sit so that the legislation can go through after it has been properly considered. We are not in the business of rushing legislation through this place ill considered simply because it suits the convenience of somebody to lift the Parliament. If that is the argument, I am most unimpressed. I simply pursue the amendments that I have moved. Question put: That the amendments (Senator Peter Rae's) be agreed to. The Committee divided. (The Chairman-Senator D. J. Hamer) Ayes . . . . . . . . . . . 29 Noes . . . . . . . . . . . 37 —— Majority . . . . . . . . . 8 —— Archer, B. R. Messner, A. J. Baume, Peter Missen, A. J. Bjelke-Petersen, F. I. Parer, W. R. Boswell, R. L. D. Puplick, C. J. G. Brownhill, D. Rae, PeterCarrick, Sir John Reid, M. E. (Teller)Collard, S. J. Scott, D. B. Crichton-Browne, N. A. Short, J. R. Guilfoyle, Dame Margaret Teague, B. C. Hamer, D. J. Townley, M. Hill, R. Vanstone, A. E. Kilgariff, B. F. Walters, M. S. Lajovic, M. E. Watson, J. O. W. Lewis, A. W. R. Withers, R. G. MacGibbon, D. J. Aulich, T. Hearn, J. M. Black, J. R. Jones, G. N. Bolkus, N. McIntosh, G. D. (Teller)Button, J. N. McKiernan, J. P. Childs, B. K. Macklin, M. J. Chipp, D. L. Maguire, G. R. Coates, J. Mason, C. V. J. Colston, M. A. Primmer, C. G. Cook, P. F. S. Ray, RobertCooney, B. Reynolds, M. Crowley, R. A. Richardson, G. F. Devlin, R. Robertson, E. A. Elstob, R. C. Ryan, S. M. Evans, Gareth Sibraa, K. W. Evans, Jack Tate, M. C. Foreman, D. J. Vigor, D. Georges, G. Walsh, P. A. Giles, P. J. Zakharov, A. O. Haines, J. Knowles, S. C. Coleman, R. N. Sheil, G. Gietzelt, A. T. Jessop, D. S. McClelland, DouglasChaney, F. M. Grimes, D. J. Question so resolved in the negative. Bills, as amended, agreed to. SALES TAX (No. 5) AMENDMENT BILL 1985 SALES TAX (No. 10A) 1985 SALES TAX (No. 10B) 1985 SALES TAX (No. 10C) 1985 Bills agreed to. Bills reported with amendments; report adopted. Bills (on motion by Senator Ryan) read a third time. Debate resumed from 15 May, on motion by Senator Grimes: That the Bill be now read a second time. Senator PETER RAE(Tasmania)(12.28) —The Taxation Laws Amendment Bill 1985 contains a package of a variety of taxation measures which I shall briefly outline. It includes a measure to abolish the 30:20 rule which requires life assurance companies and two categories of superannuation funds to hold at least 30 per cent of their assets in public securities, including at least 20 per cent in Commonwealth securities, in order to be eligible for special tax concessions; the proposal to abolish that was announced in September last year. The Bill contains a measure to counter further tax avoidance schemes of the expenditure recoupment type. It contains a measure to phase in personal income tax and to introduce full company tax and the Medicare levy on Christmas Island from the commencement of the 1985-86 income year, which decision was announced on 10 April 1985. It includes a measure to permit the Commissioner of Taxation to make available to the Australian Statistician for statistical purposes certain information in respect of business taxpayers and a measure to achieve consistency between the provisions of the pay as you earn and the prescribed payments systems by extending the objection and appeal rights available in relation to certain PPS penalties to corresponding penalties under the PAYE provisions. Further, it corrects a drafting error in the provisions extending eligibility for the dependent spouse rebate to de facto couples, which had the unintended effect of denying a part-year entitlement to a daughter-housekeeper rebate where the taxpayer contributes to the maintenance of a spouse, whether legal or de facto, during some other part of the year of income. An inadvertent amendment to the taxation legislation had an effect of disqualifying a section from something that was intended. Without casting aspersions reflecting on the vote of the Senate, I refer to the debate we have just had on the sales tax amendments. I express the hope that we do not find that the same sort of inadvertence has the effect that we have to bring in legislation at a later stage to try to patch it up. Also included in the package are measures to exclude payments of social security family income supplement from the separate net income of a dependant for concessional rebate purposes and to make a number of formal amendments to reflect changes in the machinery of government to effect some minor drafting changes and to repeal redundant provisions relating to Commonwealth and State public servants appointed to Taxation Boards of Review. The position is that the Opposition either supports these measures or does not oppose them. In other words, we will not be voting against the Bill, whilst we have some reservations on some aspects. We say it is a matter for the Government. There are other aspects which we warmly support. Let me deal with them. First, the abolition of the 30:20 rule is very near and dear to my heart, having advocated this for very many years. I believe the justification for the 30:20 rule which required a quid pro quo for the taxation concession which was given for the purpose of encouraging savings and encouraging people to make life assurance provision for their families should be subject to a taxation incentive; that is, a taxation expenditure for the Government and the taxpayer and a taxation benefit for the person who was benefiting from the rule. The quid pro quo was that some of the funds had to be lent back to the Government to ensure that in a capital short country-as we were and still are, but to a much lesser extent-there was a flow of this form of personal savings back into the market where it would be available for the purposes of loans to government. That, I believe, was an eminently sensible provision at the time it was introduced. However, things have changed. It was interesting to note that the Campbell Committee of Inquiry into the Australian Financial System, in its final report at page 335, referred to the 30:20 requirement. Paragraph 20.33 states: It has been argued that, to a degree, the 30/20 requirement may have helped maintain the quality of the assets held by some life insurance companies, particularly the smaller ones. If a policy with a twenty-year run to maturity is matched by government securities of similar maturity, it is suggested that fluctuations in the market price during the time to maturity are immaterial. Paragraph 20.34 states: The Committee does not accept this view. The matching of assets and liabilities by term would be of little comfort if, in times of high interest rates, large numbers of policy holders sought to surrender policies backed by government securities issued in the past at low interest rates. It should also be recognised that, by forcing life offices to accept something less than a market rate on a substantial proportion of their investments, the 30/20 requirement has impacted adversely on the competitive position of life offices in financial markets. This may, in at least some instances, have led them to undertake more risky but higher yielding investments. The comments I made a moment ago I believe are particularly apposite to that reference. What was a very thin capital market is still a relatively thin market. It is developing and the measures which were recommended, the implementation of which had commenced under the previous Government-I compliment the present Government for having continued with the measures for deregulation of our financial markets-are a reflection of the increased depth and the increased sophistication of our markets. Australia has reached a stage where it can avoid the sorts of restrictions and special channelling of funds and the imposition of relatively restricted lower interest rate earnings with regard to these funds which were reflected in the requirements of the 30:20 rule. I have not taken as long as I would have liked to talk about the implications of the 30:20 rule and the capital market, but perhaps we ought to be paying a little more attention than we have in the past to some other areas of the market such as the unit trust area, which has some considerable difficulties which need attention, rather than to the life and superannuation funds area. This is basically covered by fairly clear regulatory systems-a prudential system of sufficient validity to enable the Campbell Committee and the Opposition to recommend the abolition of the 30:20 rule and to enable the Government to put forward this measure, which we happily support. I refer to measures to counter expenditure recoupment schemes of tax avoidance. The former Treasurer on 24 September 1978 announced the crackdown on various types of tax avoidance schemes involving round robins and the artificial creation of losses. The general thread of these schemes was for a taxpayer or associate to be compensated in a non-taxable way for loss or outgoing sought to be deducted. These schemes have become known as expenditure recoupment schemes. The announcement of 24 September 1978 was as follows: . . . further schemes emerge that feature elements common to the schemes covered by this statement . . . further legislation will be introduced . . . effective as from today. This warning has been acted upon since that date at least once by the former Liberal-National Party coalition Government. The announcement that was made in September 1978 was part of the crackdown by the former coalition Government on tax avoidance which led the Commissioner of Taxation to say in his report for the year 1983-84 that one of the great success stories of the last decade has been the elimination of the artificialities of the tax avoidance industry. I believe the coalition Government can be justly proud as it started to identify the avoidance measures. There was a range of talent of very considerable magnitude against Government. It became a major industry which employed some of the best brains in the country in devising schemes for tax avoidance. The government of the day was determined that action would be taken to crack down on this, as was said by the then Treasurer, Mr Howard, in September 1978. Measures were steadily taken to crack down. As the Commissioner of Taxation said in 1983, at the start of the new Government, the great success story over the past decade was the crack-down that had been achieved by the former Government. The Bill acts on the warning which was given by the former Treasurer on 24 September 1978 to catch variants of the scheme that have recently come to light. The amendments apply to agreements entered into after 24 September 1978 and before the introduction of Part IVA of the Act on 27 May 1981. The amendments are consistent with our approach to retrospective taxation as they apply only after the date of an appropriate warning announcement. The potential revenue from this measure is estimated to be $25m. I emphasise that the Opposition is opposed to retrospective legislation where people have no reasonable basis for knowing what the law was or would be. Where a clear warning has been given that it is the intention to legislate with respect to certain matters, it is fair to date the legislation from the date of the warning being given. The warning was clear and unequivocal, so we support this particular provision. We do not oppose the introduction of income tax on Christmas Island. At present the residents of the Territories of Christmas, Norfolk and Cocos (Keeling) Islands are exempt from income tax on income derived from sources outside mainland Australia. This includes income of companies or trusts, as long as they are incorporated, owned and controlled by Territory residents. In practical terms, genuine residents of the Territories are subject to tax only on income earned in mainland Australia. After this Bill has been passed, Christmas Island residents, including companies and trusts, will be treated like residents of mainland Australia for tax purposes as from the current income year, 1985-86. Income tax will be phased in over three years but company tax and the Medicare levy will apply in full as from the end of 1985-86. The amendments will not affect the residents of Norfolk Island or Cocos (Keeling) Islands in respect of incomes from those two Territories or sources outside mainland Australia, but it will mean that any income they earn from sources in Christmas Island will be taxable. These amendments are part of a package to integrate Christmas Island with the rest of Australia. Revenue from these changes is estimated to be $1m in the first year, rising to $4.4m and then to $6m in 1988-89 when the three-year phasing-in period is completed. This will be offset by other aspects of the island integration package. The package is well known and the general proposals in relation to the integration of Christmas Island with mainland Australia have been debated in the Senate recently. Of course it is understood and expected that, as part of the package, Christmas Islanders would be treated as are other Australians for taxation purposes. The next measure concerns disclosure of information to the Australian Statistician. I do not wish to say anything in detail on that matter other than that there will be a significant additional administrative cost, estimated at some $400,000 in a full year. In not opposing that, we would hope that there will be benefits obtained as a result of the provision of information which will offset and justify in any cost-benefit analysis the extra cost involved. The amendment on the matter of objection and appeal rights in relation to certain penalties is reasonably straightforward. The amendment is designed to correct an oversight which has existed. It will not extend the objection and appeal rights to the remission decisions in relation to the 20 per cent per annum late payment penalties imposed for breaches of either PAYE or the prescribed payments provisions of the law. It is arguable that they should be extended in this way and that all decisions of the Commissioner to remit or not remit penalties should be subject to objection and appeal. I raise that matter but I do not intend to press the point by way of amendment. I draw it to the Government's attention because it is a matter which should certainly be taken into account. Whilst we do not oppose the measure, we point that out. The provisions on interest on refunded prescribed payments or PAYE penalties will include those prescribed payments and PAYE penalties that are to be made subject to objection and appeal procedures by other parts of the Bill in categories of taxes where interest is payable by the Commissioner of Taxation and where refunds are made available following a successful objection or appeal. That is obvious and of course we support it. The amendment on rebates for dependants is a measure to correct a drafting error in one of the provisions of the Income Tax Amendment Act of last year. I will not detain the Senate to discuss that in detail other than to point out that it is a correction of something that was unintended. There are also changes concerning the family income supplement. As the law now stands the supplement, which is an income tested allowance payable to low income families with children and which is exempt from tax in the hands of the recipient, is not excluded from the separate net income test for purposes of dependant rebates. This would result in an unintended reduction in the amount of rebate that would otherwise be allowable to a taxpayer for a dependent spouse compared with the situation that existed previously. Debate interrupted. Sitting suspended from 12.45 to 2 p.m. Senator MESSNER —My question is addressed to the Minister representing the Minister for Social Security. In light of the uncertainty and confusion surrounding the pensions assets test, has Cabinet yet decided on changes to remove at least some of the anomalies and inequities in the test? If so, can the Minister tell the Senate what those changes will be? Does the Government intend to bring amending legislation into the Parliament before the winter recess? Senator GRIMES —As I intimated the other day, Cabinet has considered some modifications to the assets test as it affects rural pensioners. Some changes have already been made. The speed and effectiveness of valuations are increasing. Changes are being made to the hardship provisions. The matter has not been finalised, as I understand it, by the Minister for Social Security. Any changes will be announced by him. I am not sure of the exact date. There is no need for legislation to bring about such changes. Senator BLACK —Is the Minister for Resources and Energy aware that Press reports of his recent statements to the Australian Institute of Petroleum have caused concern among petroleum refinery workers who fear that their refineries might be closed as a result of the imminent deregulation of the petroleum industry? What are the long term prospects for the job security of Australian refinery workers? Senator GARETH EVANS —I am, of course, aware of Press comments stemming from my recent address to the Australian Institute of Petroleum, particularly with regard to the possible further rationalisation of the Australian refining industry in the event of the introduction of a free market for crude oil. Let me stress at the outset that the Government has not made any decisions on this matter as to whether a free market should be introduced and, if so, in what form and when. It will do so only in light of the responses we receive to the discussion paper which I released canvassing all the relevant issues in detail following that address to the Institute of Petroleum. That discussion paper of a couple of weeks ago identified numerous issues that will have to be resolved before the Government considers a decision on a modified free market. One of those issues is, of course, the effect on the Australian refining industry. I should say that views differ greatly about what the likely effect of the free market would be on the refining industry. Some hold the view that there would be increased pressure on refineries such as those in Brisbane and Perth from product imports in particular, because those cities are furthest from Bass Strait, our major oil-producing area, and equally are closest to import supply lines. However, others within the oil industry argue strongly that both Perth and Brisbane refineries would continue to be perfectly viable in a free market situation. The Government has not made up its mind. We have asked as to the merits of these competing arguments. We have not had enough information before us to be able to do so. What we have done is to ask people with an interest in this matter to make submissions to us, not only the refiners and producers but also the State governments and the Australian Council of Trade Unions. My comments to the AIP were in the context of that discussion paper, designed quite deliberately to stimulate discussion and response on this very difficult and sensitive issue. I certainly make no apology for them. The employment effects of this whole question will undoubtedly have to be considered very closely in light of the comments we receive from interested parties and, in particular, from the ACTU. Senator PARER —My question is directed to the Minister for Finance. In light of the confusion and uncertainty surrounding the Government's plans to change the taxation system, confusion which was added to by his answer to me yesterday on income splitting, I ask: Is the Minister aware that, at about the same time he was refusing to tell the Senate whether the question of income splitting would be covered in the White Paper on taxation, the Prime Minister was telling the House of Representatives that the pros and cons of the proposal would be canvassed in the White Paper? As the Minister spent so much time yesterday on the cons of income splitting, we will now give the Senate a rundown on the pros? Senator WALSH —I refuse to disclose the contents of the White Paper. Apparently, the Prime Minister disclosed some of its contents. I suppose that is one of the prerogatives of being Prime Minister. I do not feel particularly embarrassed by it and there is no reason why the Government should be embarrassed by it. If Senator Parer wants me to say a bit more about income splitting, I shall. Income splitting means different things to different people. It meant at least three different things to three members of the Opposition when it was proposed before the last election. As proposed by Mr Howard, if I remember it correctly, it allowed a maximum transfer from one income to the other of some $9,000. As proposed by Mr Sinclair, it meant allowing anybody at all, no matter what his income, to transfer up to 50 per cent of it to a spouse. Mr Peacock's view as usual was somewhere in between the two. He did not know where he was and probably did not understand the issue. However, as seriously proposed by Mr Howard, the so-called benefits of income splitting would be very limited to households on low incomes because, in splitting the income, the dependent spouse rebate would be wiped out. As each dollar of income is transferred, after $282 the dependent spouse rebate would be wiped out at a rate of 25 per cent, which is very close to the marginal tax rate paid by someone on a median income. So the advantages of a transfer of up to $9,000 or thereabouts in that sort of household, that is, a household on a median income of around $17,000, are negligible. The advantages, however, for a household on, say, a $50,000 income are quite substantial, particularly if the spouse already has some income which has thereby disqualified the other taxpayer from claiming a dependent spouse rebate. For example, let us assume that one taxpayer has a $50,000 income and his spouse has an income of $5,000, thereby disqualifying the taxpayer from claiming any dependent spouse rebate. If $9,000 of income were transferred under the existing Schedule there would be a gain of the difference between the two marginal rates, that is, above $5,000 and above $40,000. The marginal rate in the latter case is 60c in the dollar. The marginal rate in the former case is 25c in the dollar for almost the entire range of the original $5,000. It rises for almost the entire extra $9,000 split, to 30c in the dollar. A quick calculation from that example shows that the gain to that sort of taxpayer from that sort of income splitting would be of the order of $3,000, whereas the gain to a median and single income household would be negligible. Senator TATE —My question is directed to the Acting Minister for Foreign Affairs. Has Mr Pacifico Castro, the Acting Foreign Minister of the Philippines, criticised the provision of Australian aid to the Philippines as fostering 'rather uncomfortable feelings of dependence' and described Australian missionaries as 'trained political agitators'? Will the Australian Government take steps to relieve the Philippines Government of this discomfiture immediately in the case of military aid, running at several millions of dollars per year? Does the Australian Government accept Mr Castro's description of Australian missionaries as trained political agitators? Does it consider them, therefore, to be in any danger, given his regime's tolerance of torture and death squads used against those perceived as being political dissidents? Senator GARETH EVANS —The Government is aware of comments about activities of Australian missionaries in the Philippines purported to have been made by Mr Castro, the Acting Foreign Minister of the Philippines, in an interview with the Australian Financial Review. The Government of the Philippines has, however, never officially complained about the activities of Australian missionaries in the Philippines. We are simply not in a position to comment on the accusations contained in the article in that respect. The Australian Government takes the view that a healthy trading relationship between the Philippines and Australia is desirable and is endeavouring to encourage it. We also wish to assist in the promotion of development in the Philippines and the Philippines Government has welcomed this assistance. Part of Australia's development assistance effort is in the Northern Samar integrated rural development project. There has been criticism of that Northern Samar project from various sources, including Australian Catholic groups. The members of the insurgent group, the New People's Army, who contacted project personnel on 12 April were aware of this criticism, but their objection to the project appears to have stemmed somewhat from their own wider ideological aims. There was no threat to project personnel. The Northern Samar project is designed to do something effective for a needy area of the Philippines. Its emphasis is on raising agricultural output, which is the source of livelihood for the bulk of the population, and community development. Senator CHANEY —My question is addressed to the Leader of the Government in the Senate. I refer to the uncertainty and confusion which surrounds the Government's wages policy and the recent evidence of that when the Minister, two days ago, said that the Government had not yet decided whether to argue for discounting at the time of the September national wage case and would not make that decision until much closer to the hearing. I further remind him that last Thursday the Minister for Finance said that the Government would not argue for discounting in September and Senator Walsh confirmed that answer in the Senate only yesterday. Does the Minister agree that it is not possible for both him and Senator Walsh to be telling the truth? Will he clear up the confusion by telling the Senate whether or not the Government has made a decision to argue for discounting in September and, if it has made a decision, what that decision is? Senator BUTTON —On the day in question I did not say that the Government had not yet decided. I said that the Government was cool about the issue. If Senator Chaney wants to place that interpretation on what I said, no doubt he will do so. What I did draw attention to in the answer I gave to the question was the Government's view, which has been often repeated, that the effects of devaluation will not be at all marked in the September quarter and will not be particularly relevant in the context of the September 1985 wage case. What I did leave open quite explicitly was what could happen in the March quarter for 1986, when the Government anticipates the full effects of the devaluation will have flowed on to the consumer price index. It was, of course, said by way of interjection at the time I gave that answer, I think by Senator Chaney- Senator Chaney —Senator Durack. Senator BUTTON —Senator Durack interjected that we had not made up our minds yet, or something like that. Senator Chaney —No; he just said that you were confused. Senator BUTTON —He said I was confused. Well, that is very helpful. Having drawn attention to erroneous information in the question, I will now deal with it. As I said on the previous occasion, the Government does not anticipate any significant impact on the CPI relevant to the September 1985 wage case. We will look at that question of the effects of the devaluation at the time but, as has already been said, it is not considered that it will be appropriate at that time to discount in the way which has been suggested by some commentators. Senator CHANEY —Mr President, I ask a supplementary question. Let me quote the exact words from the two Ministers to counter Senator Button's blurring of this issue. Senator Button said to the Senate: . . . we will examine the position with regard to that hearing at that time. He was referring to the September hearing. On the other hand, Senator Walsh said: . . . the Government will not argue for discounting of the devaluation induced consumer price index effect in the March and June quarters . . . I again ask the Minister: Is he saying that a decision has been made by the Government with respect to what will be argued, or is he saying that that is a matter that will be decided in September or closer to the September hearing? Senator BUTTON —The Government's clear disposition is not to discount the effects of the devaluation at the September quarter hearing. If, on the other hand, we are wrong about the impact on the CPI by September, of course we will have to examine that question at that time. What we have said on numerous occasions is that we do not see any likelihood of its being important that we do it in the September wages case; we do see the strong possibility that it will be important in the March case of 1986. If I have to go on playing verbal tootsies on this issue, let me say- Senator Durack —Perhaps you could tell us what your disposition will be in regard to March next year. Senator BUTTON —All the Commonwealth can do is to put a position to the wages case this year and to put a position again next year. If Senator Durack is trying to strap us up to saying a long way in advance of every national wage case what the Government's submission to it will be we will not accommodate him, and he would not accommodate us in such a situation either. Senator HEARN —My question, which is addressed to the Minister for Resources and Energy, concerns the production of and demand for uranium. I understand that Canada is now considered to have the largest and richest deposits of uranium in the Western World. In fact, a recent discovery appears to be the greatest concentration of uranium ever found. What effect, if any, is this having upon the sale of Australian uranium and what effect is it likely to have in the future? What is the present price received for Australian uranium compared with that received in each of the last three years? Senator GARETH EVANS —I believe the honourable senator is referring to the Cigar Lake project in northern Saskatchewan. Reserves of 110,000 tonnes of contained uranium at a grade of 12 per cent uranium have been reported. A western extension of the ore body is believed to contain reserves of 39,000 tonnes of uranium at a grade of 3.9 per cent uranium, making Cigar Lake the richest deposit of this size in the world. For comparative purposes, Ranger has approximately 110,000 tonnes of contained uranium at an ore grade of 0.25 per cent. However, Australia has the largest low cost ore reserves in the Western World, with reasonably assured resources of 463,000 tonnes of uranium recoverable at a cost of less than $US80 per kilogram, while Canada has only 176,000 tonnes in the same category. The Canadian figure that I mentioned does not include Cigar Lake, as this is not a low cost reserve. It cannot be mined using existing technology. If this 400m deep deposit is to be developed at all, new remotely controlled mining equipment will be needed as a consequence of the radiological hazards presented by the richness of the ore, and we consequently do not expect output from Cigar Lake to appear on world markets before the middle 1990s at the earliest. I am not aware that the discovery at Cigar Lake has had any discernible impact on the sale of Australian uranium, nor is it likely to in the absence of a firm commitment to development. It may be, of course, that the mere discovery of such a deposit has added to the general level of long term consumer supply assurance, especially in the current market, which is characterised by excess supply, surplus inventories and depressed prices. As to the last part of Senator Hearn's question about prices, official trade statistics published by the Australian Bureau of Statistics note that the average value of Australian uranium exported in 1984 was $A42.79 a pound of U308, compared with $A41.02 in 1983, $A34.48 in 1982 and $A33.50 in 1981. I will not attempt to forecast the future movements of the price of this commodity. Senator BROWNHILL —My question is directed to the Leader of the Government in the Senate. In light of the confusion and uncertainty surrounding the Government's plans for changes to the taxation system, I ask: Has the Government yet decided whether the tax White Paper will contain a preferred position? If so, what is that position? Senator BUTTON —The tax White Paper will, I believe, be publicly available within a week. I suggest the honourable senator take time to read it when it is made available to him. Senator BOLKUS —My question, which is addressed to the Acting Foreign Minister, follows on from the question asked earlier by Senator Tate. Is the Minister aware of the recent arrest of five human rights lawyers in the Philippines, all members of the Free Legal Assistance Group which defends clients against government and the military in that country? Is it a fact that the lawyers were arrested and detained by the military without applying to civilian authorities such as the law courts? Has it also been claimed that this action is part of the Marcos approach to intimidate human rights lawyers and frighten opponents within the Philippines? Can the Minister say whether the Australian Government is taking any action to register its disapproval of this form of action? Senator GARETH EVANS —The Government is aware that five lawyers affiliated with the Free Legal Assistance Group, FLAG, in the Philippines, have been arrested. Two of those lawyers, Romeo Astudillo and Alberto Benesa, were arrested by presidential detention action orders in Abra in northern Luzon at the end of April. On 10 May two more lawyers, Laurente Ilagan and Antonio Arellano, were arrested in Davao City in Mindanao, reportedly under mission orders signed by the Minister for Defence. A fifth lawyer, Marcos Resonar, was arrested too in Davao City on 13 May, reportedly under a mission order signed by the regional military commander. National lawyers' organisations have filed a petition of habeas corpus for the three lawyers most recently detained in Davao City and have claimed that the arrests were illegal. We understand, however, that the privilege of the writ of habeas corpus remains suspended in that region. The Australian Government has on many occasions reaffirmed its commitment to the international protection and promotion of human rights and takes a very close interest in aspects of human rights in the Philippines. The Australian Embassy maintains continuing contact with human rights and civil liberties groups in the Philippines. I have asked the Embassy to provide further information on those arrested, and the circumstances of their arrest, and to follow developments affecting the lawyers in question. Senator KILGARIFF —I direct a question to the Minister representing the Minister for Aboriginal Affairs. In light of the confusion and uncertainty which surrounds the Government's policy on Aboriginal land rights-confusion which has been worsened by the Prime Minister's meeting yesterday with Aboriginal representatives in Canberra-I ask: Has the Government decided not to bring in national land rights legislation this year? Is it true, as claimed by some of the Aborigines who met Mr Hawke yesterday, that the Prime Minister is reconsidering his opposition to an Aboriginal mining veto? Senator RYAN —I do not have a briefing following the meeting of the Prime Minister with Aboriginal representatives yesterday so I cannot answer specifically. But I repeat to Senator Kilgariff what I have said to him many times in this chamber; that is, our Government is committed to achieving land rights for Aboriginal people. Available for comment and consultation at this stage is a model which the Minister for Aboriginal Affairs, Clyde Holding, has developed as a result of many discussions with Aboriginal people, other parties and interest groups. That model is available for discussion and negotiation. Some spokespersons for Aboriginal organisations have expressed disappointment in the model; others are prepared to discuss and negotiate it. Obviously, a period of further discussion is necessary before the matter is settled but I can only repeat-- Senator Chaney —This year, next year, some time, never. Senator RYAN —It is very interesting that Senator Chaney should choose to interject in this smart-Alick fashion when it was his Party, the Liberal Party in Western Australia, which carried out the most scurrilous anti-land rights campaign that this country has ever seen. The Liberal Party in Western Australia published racist booklets, full of inaccuracies and designed to cause prejudice within the Western Australian community. Unfortunately, those booklets have had an effect on the electorate in Western Australia. The performance of the Liberals in Western Australia in relation to land rights has been absolutely disgraceful. Every Aboriginal in Australia would agree with me, on that point at least. In contrast to the provocative and racist behaviour of the Liberal Party in Senator Chaney's State, our Government, ever since taking office, has discussed how we can achieve, nationally, land rights which incorporate the principles which have been set out throughout Australia. It is a complex matter on which progress has been disappointingly slow. Nonetheless, our commitment to uniform land rights throughout Australia remains. The Minister for Aboriginal Affairs, Clyde Holding, the Prime Minister and the Government generally will continue to pursue that objective until we achieve it. Senator KILGARIFF —Mr President, I have a supplementary question. We are fully aware of the preferred model, and the situation until yesterday. As the Minister has not been briefed by the Minister for Aboriginal Affairs, will she obtain a briefing as to what the Prime Minister has said to the Aboriginal people and what assurances he has given them? Will she bring that information back to the Senate? Senator RYAN —I am very interested to know the outcome of discussions that were held yesterday. If there is any development in terms of policy I will inform the Senate of it as soon as possible. Senator ELSTOB —Is the Minister representing the Minister for Primary Industry aware of the 'Electronics in Agriculture' report that claims great potential in the development and export of high technology agricultural equipment? Is the Government likely to respond to the report and initiate industry interest in what appears to be a very lucrative area? Senator BUTTON —I am not the Minister representing the Minister for Primary Industry. The question contains two elements, one relating to electronics and one relating to agriculture. Senator Walsh —Besides, he has got the brief. Senator BUTTON —Senator Walsh says that I have the answer and he does not. Firstly, I am aware of the report 'Electronics in Agriculture' recently released by the New South Wales Minister for Technology. An officer of my Department recently attended a conference on this report held in Armidale in New South Wales. The Government has already been participating in the promotion of electronics in agriculture through the research and development support provided by the Commonwealth Scientific and Industrial Research Organisation and other generally available assistance programs. I expect that this report will be an important on-going aid to the Government and this country in the development of policies for the encouragement of increased use of electronics in agricultural industries. Senator WALTERS —My question is to the Minister representing the Prime Minister. In view of Mr Hawke's trenchant criticism of the United States intervention in Grenada in October 1983 I ask the Minister: Has the Government noted the results of the recent democratic elections in Grenada? Is it a fact that 95 per cent of Grenadians voted for politicians of political parties who supported President Reagan's intervention with only 5 per cent voting for the pro-Cuban revolutionaries who ran the country before the marines went in? Does this not underline the absurdity of the Hawke Government's critical stand at the time of the intervention? Senator BUTTON —The results of the recent election in Grenada have been noted by the Government. They do not underline anything in terms of the absurd proposition that Senator Walters put to me in the question she has just asked. Senator MAGUIRE —What information can the Minister representing the Minister for Local Government and Administrative Services provide on the new Commonwealth office centre to be constructed at Port Pirie in South Australia? What is the timetable for the development of this project, which is of significance to the local building industry? Will attention be paid to Australian heritage questions in the development of the project? Senator RYAN —The Port Pirie project was approved by the Government as part of a nationwide office construction program aimed at stimulating the building industry, generating employment and reducing the Commonwealth's annual rent bill. The project will provide 800 square metres of space to meet the immediate needs of the Australian Customs Service and the Department of Social Security. The site is being purchased from the State Government by the Commonwealth for $21,000. As the building will be located within a heritage precinct the selected design meets the requirements of the Australian Heritage Commission and the Port Pirie Council. The final contract and price negotiations are in progress with the developer and it is anticipated that the construction will begin by mid-1985. Senator PETER BAUME —My question is directed to the Minister for Education. It concerns the participation and equity program described by the Prime Minister and the Minister for Education in times past as 'the centre piece' of Labor's policy to youth. I remind the Minister of the mini-Budget decision to cut this program in half in 1986 and of the Government's statement that the cuts which were presented to Parliament represent Labor's priorities. I ask the Minister: Does this expression of Labor's priorities envisage cutting out parts of the participation and equity program directed towards disadvantaged schools, or do Labor priorities envisage the ending of programs for the long term unemployed youth, the handicapped, the isolated and the non-English speaking students who presently use the technical and further education component of the PEP? Senator RYAN —It is the case, as Senator Baume's question pointed out, that the Government has decided to slow down the participation and equity program. In fact, the funds appropriated for 1986 will be halved and those funds will be available in 1987. Regrettable as this is, this decision was brought about as a result of the necessity faced by the Government to achieve some savings off the Forward Estimates. Although I regret that the program has had to be affected in this way, I should make it quite clear that the decision does not mean that the Government is resiling from its objective of increased participation, nor from its concern that participation in education be extended to previously disadvantaged groups. The effect of the decision will be this: The amount of money allocated to the program for 1986 will be halved and that will affect in proportion the TAFE and schools components. They will each be slowed down the to extent of losing for 1986 half of the funds that had been appropriated. However, the program will continue into 1987, so that it will be a four-year program instead of a three-year program. The effect of this will be to spread out the program and some projects under the program will start up more slowly, but it will not mean an overall loss to the program of any financial support. I will not pretend that I was anything other than reluctant about this decision, but having admitted that, frankly, I will say that the slowing down of the program will have some benefits. It will enable the Government, the Commonwealth Schools Commission and the Tertiary Education Commission to assess how far the program has already met its objectives and whether the procedure of targeting schools for involvement in the program is meeting the objectives. It will give us time to review the operation of the State committees-and I admit that there have been some administrative problems stemming from the State committees. The program will operate more slowly and new projects will be taken up more slowly, but I hope that the money will be better targeted and the outcomes-which are, after all, what we are interested in-will continue to be very effective. I say in conclusion that the Government considers that the participation objective has already been successful. If Senator Baume turns his attention to the statistics, which I am sure he has already done, relating to participation rates in upper secondary schools in all States and Territories of Australia, he will see that already there has been considerable improvement. Similarly, the participation in TAFE by disadvantaged groups has shown a marked improvement. I believe both of those trends of improvement will continue with a very clear direction of funds and the most efficient possible use of resources. Senator FOREMAN —I draw the attention of the Minister for Resources and Energy to the recent comments by Professor Derrick Sewell, a world expert on river systems. During the launching of Professor Sewell's publication Who Owns the Murray? he suggested that the Australian Federal Government could do much to facilitate negotiations on the management of the River Murray by imitating the Canadian central Government and acting to bring interested parties together. I ask the Minister: Does the Federal Government see itself in the role of co-ordinator and mediator and does the Minister agree that such an arrangement might be of benefit to South Australia which, although it does not have as much power as the up-river States, stands to suffer most from the problems resulting from salinity? Senator GARETH EVANS —I have seen reports of Professor Sewell's remarks about the desirability of better co-operation on water matters and his suggestion that the Commonwealth could do much to facilitate negotiations on the management of the River Murray by imitating the Canadian central Government and acting to bring interested parties together. I think that perhaps Professor Sewell in making those remarks was not fully aware of the provisions of the existing River Murray Waters Agreement, which, in the Government's view, fully meet his objectives. The Government believes that the River Murray Waters Agreement is the appropriate mechanism for Commonwealth-State collaboration in River Murray matters. Under the new agreement the River Murray Commission is empowered to take account of water quality, which is South Australia's overriding concern, and it is now preparing a long term river management plan. In preparing this plan the Commission is having regard to public comment on its recent discussion paper dealing specifically with River Murray salinity problems. The Government believes that the passage of some time is necessary before a reasonable conclusion can be reached as to whether the new agreement is effective in improving water quality in the Murray. If deficiencies are identified which impair the objective of the new agreement, I can assure Senator Foreman that the Government will consider appropriate courses of action, including that flagged by the professor to whom Senator Foreman referred. The PRESIDENT —Order! I draw the attention of honourable senators to the presence in the President's gallery of members of a parliamentary delegation from the Bundestag of the Federal Republic of Germany, led by Mr Richard Stuecklen, who are on an official visit to Australia. On behalf of all senators I extend to our guests from the Federal Republic of Germany a warm welcome to Australia, to Canberra and to the Senate. Honourable senators-Hear, hear! Senator SHORT —My question is addressed to Senator Button in his dual capacities as Leader of the Government in the Senate and Minister for Industry, Technology and Commerce. I refer Senator Button to his answer yesterday to Senator Chaney's question, which followed on from my question of 7 May, as to whether the forthcoming White Paper on taxation will address the issue of business tax reform. In his answer yesterday the Minister said that it would. I now ask the Minister whether he is in a position to answer the second part of my question of 7 May; namely, whether the issue of business taxation will also be considered at the July tax summit? If so, I ask whether he, as the Minister responsible for industry policy, of which business taxation is an essential element, has had negotiations with the business sector over the handling of business taxation issues at the summit, in the same way as the Government has been engaging in constant negotiations with the tax negotiating committee of the Australian Council of Trade Unions over the taxation issues of concern to the trade union movement? Senator BUTTON —I am asked essentially whether the question of business taxation will be considered at the July taxation summit. I am not on the agenda committee for the July taxation summit but there will be, of course, substantial representations from the business community at that summit and I think that they will wish to raise issues of business taxation. Therefore, my answer to the question as to whether it will be on the agenda is probably yes, because I would anticipate that a significant group of participants at the summit would so wish it. I am asked also whether I have had negotiations with the business community in the same way as Senator Short suggests the Government has had negotiations with the ACTU regarding issues more associated, I believe, with the direct taxation system. The answer is that I have not had any publicised negotiations with the business community. I have had numerous discussions from time to time, as I always try to do, with representatives of the business community about business taxation issues. In due course, if they request, I will be quite happy to meet with them on the agenda for the summit, if that proves necessary or desirable. Senator SHORT —I ask a supplementary question. Does the Minister's answer mean that his understanding is that the business taxation issues at the summit, for which there has already been much planning, will be treated in a different context and dealt with in a different manner from other taxation issues? Senator BUTTON —No, it does not mean that at all. Senator ZAKHAROV —My question is addressed to the Minister for Industry, Technology and Commerce. Does the Government have a policy of giving preference in purchasing to goods made in Australia? If so, what guidelines are issued to government departments to ensure that such a policy is implemented? Senator BUTTON —Yes, a 20 per cent margin of preference for locally produced goods is applied to all Commonwealth purchases. Preference does not apply to services purchased separately from goods, since naturally in the great majority of cases these services are automatically performed or provided in Australia. Where the 20 per cent general margin would result in an additional cost to the Commonwealth of $200,000 or more, the preference ceases to be applied automatically at that point and such cases are then determined by the responsible Minister. Ministers also review all purchases valued at over $100,000 where application of preference is insufficient to give the contractor a suitable offer of higher Australian content. In that situation, a group of departments advises Ministers whether a margin of preference of more than 20 per cent is warranted. I should say that there are a number of supplementary matters that are relevant to these preference arrangements. For example, purchasing procedures also provide that government specifications may not exclude suitable or adaptable Australian made products, alternative solutions offered by Australian manufacturers must be considered, as far as practicable ordering patterns must be scaled to the minimum economic order requirements of Australian industry and briefings must be made available to unsuccessful tenderers on the reasons why they failed to win orders. The operation of the purchasing arrangements is kept under review. Aspects currently under examination include payment of duty on Commonwealth imports. At present, duties apply only on a notional basis, usually the 2 per cent revenue duty. Exemptions from the preference arrangements are also under consideration. Some statutory authorities are currently exempt as a result of provisions in their own enabling legislation. The general answer to the question is: Yes, the margin is a 20 per cent margin and there are a number of sub-plots, if I may call them that, involved in working out a system of the kind that I have indicated in my answer. Senator BJELKE-PETERSEN —I refer the Leader of the Government in the Senate to comments made by an Australian Council of Trade Unions industrial officer, Mr Ian Court, who is the co-ordinator of illegal blockades of Queensland, that the ACTU was about to renege on its agreement with the Hawke Government to lift the blockade of services and transport to Queensland in exchange for the Government introducing the Conciliation and Arbitration (Electricity Industry) Bill 1985 and reimpose the blockade. In the light of this somersault and clear breach of promise, which a more realistic government would have expected, will the Government withdraw its proposed Bill? Senator BUTTON —Did Mr Court really say that? If he did, we will look at his statements and decide what we will then do. The blockade has been lifted. It has been the intention and the wish of this Government all along that the blockade be lifted. That result has been achieved, unpalatable as it may be to some of those people associated with the Queensland Government. The blockade has been lifted, and this Government will do all that it can to see that there is a sensible industrial situation, both now and in the future, in the State of Queensland. If we do not do that, the level of industrial disputes in Queensland will continue to be the brightest jewel in the crown of Senator Bjelke-Petersen's State. The level of industrial disputation in that State is something like five times the level in the rest of the Commonwealth. We want to help to avoid that situation in Queensland, and this Government will take every step it can to see that that happens. Senator HARRADINE —Has the Minister representing the Minister for Communications had drawn to his attention the decision in the High Court of Australia which upheld an appeal by television stations against the Australian Broadcasting Tribunal's perceived right to ensure that children's television programs fitted in with the guidelines as laid down by the Tribunal before those programs went to air? Is it a fact that the Government made great play of the Australian Broadcasting Tribunal having that power to ensure the standards of programs for children on all Australian television stations? What action does the Government propose? Does it propose to introduce legislation to enable the Australian Broadcasting Tribunal legally to ensure that its program standards are observed before programs go to air? Senator WALSH —I do not know anything about that matter. I will see what the Minister for Communications, Mr Duffy, has to say. Senator CRICHTON-BROWNE —I remind the Minister representing the Attorney-General of a report by the Standing Committee on Legal and Constitutional Affairs on the reversal of the onus of proof that was tabled in the Senate some two or three years ago. In my view, it was quite a compelling and persuasive document and had some notable authors. When might we expect to receive a response from the Government on that document, particularly as many questions on this subject have been raised in recent times at meetings of the Senate Standing Committee for the Scrutiny of Bills? Senator GARETH EVANS —The vigour and intelligence which Senator Crichton-Browne contributed to writing the report, regrettably, was not carried through in his reading of Hansard last year because he would have noticed that not only had the Government given interim responses on 2 June 1983 and 15 December 1983 but also on 22 October last year a more substantial response was given by the Government. The points made in that response are still applicable. First, Mr Justice Watson is presently reviewing the aspects of the criminal law of the Commonwealth and is examining the Committee's report with a view to improving the onus of proof and the averment provisions in line with the Committee's recommendations. Secondly, the Attorney-General's Department, conscious as it is of the existence of the report, whenever an onus of proof issue arises, as it often does in the drafting and preparing of legislation, draws that report to the attention of departments administering statutes which may give rise to these problems and applies the principles in the report in endeavouring to redress them. As was said in the Government statement last year: The Committee's recommendations, and the principles underlying them, have already proved influential in resolving problems on a case-by-case basis, and no doubt will continue to do so in the future. It is believed by the present Attorney that the measures that I have outlined are an adequate response to the report in the light of other competing priorities. It is acknowledged by the Government that it would be desirable to have a full scale review of all existing legislation in the way in which it treats onus of proof issues. Basically, we will be relying upon the report of Mr Justice Watson to do that for us and to lay a foundation for further action in the future. Senator CRICHTON-BROWNE —I ask a supplementary question. Inasmuch as Senator Gareth Evans cannot answer a question without being impertinent, no matter who the questioner is-- The PRESIDENT —Order! The honourable senator will ask his supplementary question. Senator CRICHTON-BROWNE —Does the Minister accept and acknowledge that it is an inordinate time since that report was first tabled and that we still do not have an absolute and definitive response from the Government but rather an ad hoc application by the Government to various parts of the report? Senator GARETH EVANS —It is just that Senator Crichton-Browne brings out the beast in me. I will do my best to respond, as always sensibly and unflappably, to his question. I do not believe there was excessive delay in the Government's response to that report, given the enormous difficulty and complexity of the issues involved. I believe that the Government has gone as far as it reasonably can to pick up the threads of what was a very significant contribution to jurisprudence by Senator Crichton-Browne and others and I am sure history will remain indebted to him for his efforts. Senator DEVLIN —I refer the Minister for Resources and Energy to an article in yesterday's Melbourne Herald in which it was claimed that the United States Naval Research Laboratory had information that there were significantly high levels of radioactivity in the thyroid glands of Victorian and Tasmanian sheep soon after the explosion of a South African-Israeli nuclear device in 1979. Did the article also state that the Australian Radiation Laboratories did not pick up such information? How efficient are monitoring systems such as the one at Cape Grim in Tasmania? Can the Minister say what action the Government will take in order to ascertain the truth of the matter? Senator GARETH EVANS —The question is relevant to me both in my own portfolio capacity and as Acting Foreign Minister, and I will give as good an answer as I can wearing both those hats. I am aware of Press reports originating from Washington concerning the release of additional information on the event, registered by a United States Vela satellite on 22 September 1979, which has led to speculation that South Africa may have detonated a nuclear explosive device. I have sought additional information on those reports but it has not yet come to hand. Reports of high iodine levels registered in the thyroid glands of sheep slaughtered in the Melbourne area in October and November 1979 are not new. Reports to this effect, citing the results of tests conducted by Dr L. Van Middlesworth of the University of Tennessee, were carried, as aficionados of Brian Toohey's contributions to freedom of information will be pleased to record, in the National Times of 2 November 1984. The Government understands that Dr Van Middlesworth regarded his analysis of sheep thyroids as interesting but inconclusive-an entirely plausible response. The prior history of the sheep was not known-I draw attention to the fact that these were Melbourne sheep and not Tasmanian sheep, so some of the guffaws we hear are misplaced-and there were problems in the analysis process as a result of cross-contamination, equipment instability and lack of sensitivity. Australian experts examined the issues in 1981 and considered that the evidence was insufficient to enable a firm conclusion to be reached. For example, separate air and water samplings conducted at the time by the Australian Radiation Laboratories in Melbourne did not provide a basis to conclude that a nuclear explosion had taken place on 22 September. A panel of non-government scientists convened by the science adviser to President Carter to conduct an inquiry into the event concluded in 1980 that it was probably not a nuclear explosion. The panel judged that it was more likely to have been caused by the impact of a small meteoroid on the Vela satellite. A United Nations expert panel reached similar conclusions. The Government knows of no evidence to support claims of Israeli collaboration with South Africa in the event, if there was such an event, of 22 November 1979. It would be of the utmost concern if in fact South Africa or any other country had contributed to the spread of nuclear weapons by exploding a nuclear device. Such action by any additional state would obviously endanger regional and international security and stability. Senator Devlin asked me another question about the efficiency of monitoring systems such as the one at Cape Grim in Tasmania, and about the performance of the ARL. I will have to take those parts of the question on notice. Senator Chaney —I ask that the papers quoted from by the Minister be tabled. The PRESIDENT —Will the Minister table the papers? The papers are tabled. Senator JACK EVANS —My question is addressed to the Minister representing the Minister for Employment and Industrial Relations. I ask whether the Government proposes to act on this recommendation of the Hancock Committee of Review into Australia's Industrial Relations Law and Systems to facilitate an arrangement whereby: Parties who wish to make their own arrangements for the prevention and settlement of disputes by conciliation and arbitration may do so. Does the Minister agree that many small businesses would be able to provide more long term jobs if they could reach agreement with their employees on awards and conditions of work outside the centralised arbitration system? Senator WALSH —I do have a note here on the matter Senator Evans raised. The Government does acknowledge the increased flexibility that such a provision could bring to the system. It should be noted that the report doubts whether in practice the proportion of the labour force that would be covered by such agreements would be large, and the recommendations stand somewhat at odds with the overall thrust of the Committee's recommendations which favour a strengthening of public interest in economic considerations in the deliberations of the Australian Conciliation and Arbitration Commission. I will refer the question to Mr Willis to see whether he has a more definite response. I understand that he made a quite detailed response to the report in the House of Representatives on Monday. I do not know whether Senator Evans knew that. Senator JACK EVANS —I ask a supplementary question. As honourable senators did not have the opportunity to respond to the statement presented by Mr Willis I ask the Minister: Do his reply and Mr Willis's statement in the House of Representatives mean that the Government will now support the Australian Democrats' Bill on collective agreements which meets the recommendations of the Hancock report on collective bargaining? Senator WALSH —Frankly, I do not know. I will seek an answer from Mr Willis. Senator GILES —My question is directed to the Acting Minister for Foreign Affairs. Australia's trading relationship with South Africa having been used by Australian cricketers to justify their rejection of the principles of the Gleneagles Agreement, can the Acting Minister give any indication of Australia's intentions should there be any resolution calling for mandatory economic sanctions against South Africa at the United Nations Security Council in the foreseeable future? Senator GARETH EVANS —Successive Australian governments have expressed strong opposition to the apartheid policies of successive South African governments. Australian governments have not always been followed by their troops, in relation to the opposition, but the record has been long and consistent so far as governments are concerned. The present Australian Government maintains this consistent and total opposition to apartheid while maintaining nonetheless correct diplomatic relations with South Africa. In keeping with the Government's strong stand against apartheid and its wish to give effect to measures that would strengthen pressure on South Africa to dismantle apartheid, Australia would support and vote in favour of mandatory economic sanctions in the United Nations Security Council. In the absence of such sanctions the Government's policy is to permit normal commercial relations with South Africa to continue, but without avoidable official assistance. Consistent with this policy there is no governmental promotion of Australian trade with or investment in South Africa. In line with this policy the Government has recently introduced, as people will be well aware, a draft code of conduct for Australian companies with interests in South Africa. Such codes of conduct have broad international acceptance. The Government does not consider that unilateral action by Australia would be an effective means of increasing economic pressure on South Africa. We are sometimes asked why the boycott on sporting contacts is not also applied in the trade area. The short answer is that the Government gives full support to the Gleneagles declaration on apartheid in sport and the Brisbane code of conduct. The obligations arising from these documents are similarly endorsed by Commonwealth countries and members of the international community. There are not as yet similar international obligations in the trade and economic area which are observed and implemented by South Africa's major trading partners. Senator WATSON —My question is directed to the Minister for Finance. Is there a higher than usual rate of issuing of income tax assessments this month compared with those issued in the month of May in previous years? Is this enthusiasm on the part of the Australian Taxation Office designed to maximise revenue collections to ensure that the Government meets its trilogy commitments to the electorate? Is the Minister aware of reports of a high element of inaccuracy in many of these assessments? Senator WALSH —I do not know whether a higher number of assessments is being issued this May than is normally the case. However, it would not surprise me if there were, because the sabotage campaign run during late January and February delayed the collection of tax. I would have expected that it would also have delayed the issuing of assessments. Indeed, there is some expectation that more assessments are being issued now than normally. But I will check the facts and have them sent to Senator Watson or report in some other way. Secondly, there is no manipulation by the Government about the number of assessments that are being issued. That matter is left to the Commissioner of Taxation and determined by the resources available to him. Senator GARETH EVANS —Yesterday in the Senate, Senator Sir John Carrick asked me a question about anti-ballistic missile research by the Soviet Union, in relation to my answer of 15 May to an earlier question by him on this subject. I have a substantial supplementary answer which I would be happy to read, Mr President, but I seek leave to have it incorporated in Hansard, if that is acceptable. Leave granted. The supplementary answer read as follows- First, the Government has never said that the Soviet Union is well advanced in SDI-type research; it has simply said, as I did on 15 May, that it is conducting such research. In recent testimony to the Disarmament and Arms control Sub-Committee of the Parliamentary JFADC, the Department of Foreign Affairs has, I understand, commented in further detail on the matter and the record of that testimony when available may be of interest. Secondly, the fact that Australia endorsed neither SDI nor its Soviet counterpart was made clear to both superpowers during the recent separate bilateral disarmament discussions with the United States and the Soviet Union. While I cannot of course go into detail of what were confidential discussions I refer Senator Sir John Carrick to the text of a summarised on-the-record briefing by the Department of Foreign Affairs to the Australian media of the Australia-Soviet bilateral talks on disarmament which was given on 22 March and reproduced in issue No. 9, dated 29 March 1985, of the Department of Foreign Affairs disarmament newsletter. Page 14 of the newsletter contains the following extract: 'We have confirmed for our part that there is no Australian endorsement of SDI or its Soviet counterpart'. Thirdly, I repeat what I said on 15 May, namely that the ABM system deployed around Moscow and the improvements being made to it, including the new phased array radar at Pushkino, are within the limits established by the 1972 anti ballistic missile treaty and its 1974 protocol. Senator Carrick's reference in his question to the nature and direction of the radar system indicates he may have in mind the large phased array radar under construction near the city of Krasnoyarsk, some thousands of kilometres to the east of Moscow. The United States has charged that by its siting, orientation and capability the Krasnoyarsk radar is prohibited by the ABM treaty. The Government is concerned about this and will continue to examine this and other US allegations of Soviet non-compliance with arms control agreements. There appears to be a case to answer and the Government hopes that the Soviet Union will take appropriate steps to respond to western concerns and demonstrate its compliance with all these important agreements. Senator Sir John Carrick —Will you send me a copy? Senator GARETH EVANS —Certainly. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce) —For the information of honourable senators, I table the final reports of the Royal Commission on Australia's Security and Intelligence Agencies. I seek leave, Mr President, to make a statement on the reports, to incorporate the text of the statement in Hansard and to move 'That the Senate take note of the statement'. Leave granted. The statement read as follows- INTRODUCTION On 17 May 1983 the Government appointed a Royal Commission, conducted by Mr Justice Hope, to undertake a major review of Australia's security and intelligence agencies. Having reported to the Government on the Combe/Ivanov affair in December 1983 and the Sheraton Hotel incident in February 1984, the Royal Commission presented its final Reports to the Government in December 1984. I now table certain of those Reports in edited form. Before commenting on the Reports, I should like, on behalf of the Government, to express my sincere thanks to Mr Justice Hope for having completed with distinction a very difficult task. His Honour is no stranger to the intelligence and security community having previously inquired into and reported on it in a series of major reports in 1976 and 1977. Those reports led, amongst other things, to the enactment of a new Act governing ASIO, a Security Appeals Tribunal, the establishment by legislation of the Office of National Assessments, the public acknowledgement of the Australian Secret Intelligence Service and Defence Signals Directorate, and the creation of a Cabinet Committee and supporting Committee of Departmental Secretaries to oversight the activities of the intelligence community. I should also like to thank the New South Wales Government for releasing Mr Justice Hope from his duties as a Judge of Appeal of the Supreme Court of New South Wales. THE REPORTS On 21 December 1984 the Royal Commission presented the Government with a General Report, individual Reports on the Australian Security Intelligence Organisation (ASIO), the Australian Secret Intelligence Service (ASIS), and the Defence Signals Directorate (DSD), and a combined Report on the Office of National Assessments (ONA) and Joint Intelligence Organization (JIO). While the nature of the subject matter of these Reports rules out, on the grounds of national security, publication of some material, the Government has decided to publish as much as is possible of the Reports within these constraints. It has taken account of the views about possible publication expressed by His Honour in each of the Reports, and has consulted with him further in reaching a decision on publication. As suggested by Mr Justice Hope, the Government is tabling edited versions of the General, ASIO, and ONA/JIO Reports. As also recommended by His Honour, the ASIS and DSD Reports are not being published, but some general comments about the legality, propriety, effectiveness and efficiency of each are to be found in the published General Report and I will have something further to say about each in this statement. I mention also that in accordance with established practice on intelligence and security matters, the Leader of the Opposition has been provided with copies of unexpurgated reports. The Government in this statement responds in broad terms to the principal recommendations raised in the published Reports. It has not yet reached a final position on all of the hundreds of recommendations and suggestions made: many raise complex issues; many are intertwined; many, if adopted, will require the introduction or amendment of legislation. Detailed examination of all the recommendations has commenced and will continue over future months. MAJOR FINDINGS AND RECOMMENDATIONS Evaluation of the Performance of the Agencies Mr Justice Hope has reiterated his views, formed during his earlier review, that Australia needs intelligence of quality, timeliness and relevance, and for this purpose requires a highly professional system of intelligence and security services (Gen., 2.43). He has concluded that Governments should continue to ensure that the intelligence community is able to fulfil its important role in helping to advise on and protect Australia's national interests (Gen., 2.44). This Government endorses those views. The inquiry by Mr Justice Hope has been a most comprehensive review of Australia's security and intelligence agencies. It has also examined a number of complaints. It has exposed deficiencies in some agencies. But while noting that there will always be room for improvement, His Honour concludes that the agencies are generally performing effectively and efficiently. He finds that: In ASIO, much work has been done, and is continuing, to restructure and revitalise the Organization, making it a service more responsive to predetermined policies (Gen., 2.21). ASIO has been concerned to ensure that its operations and actions are within its charter, and has been substantially successful in this (Gen., 2.5). Its record as to legality and propriety is good (Gen., 2.6). However, His Honour has pointed to a number of areas, particularly in management and administration, where improvement in performance is necessary. ONA, although a relatively small body, has established its independence and authority by the quality of the work it produces, and is held in high regard (Gen., 2.34, 2.36). Its national assessments have been of high quality and it also produces valuable reports on matters of current significance (Gen., 2.36). JI0 is a competent and professional agency (ONA/JI0, 4.9). It fulfils an important role in providing the Defence organisation and other areas of Government with a range of data and assessed intelligence on international, military and defence related developments (ONA/JI0, 2.18). It handles a vast amount of intelligence, and issues assessments and reports, many of which are of a high standard. Its product is well regarded by those who receive it (Gen., 2.40). ASIS has achieved success over the last decade in organising and reorganising to achieve its goals (Gen., 2.26); its effectiveness and efficiency, and its contribution to Australia's intelligence, will continue to grow as a consequence of the closer relationship with other areas of Government which it now has (Gen., 2.28). The Sheraton Hotel incident was not representative of the quality or professionalism exhibited by ASIS in performing its principal tasks (Gen., 2.28), and firm and clear steps have been taken to ensure that there will be no repetition of such an incident (Gen., 2.15). Just to expand on this point (as Mr Justice Hope suggests the Government might), the Report on ASIS recommends that ASIS's Directive be amended to exclude ASIS from carrying out covert action in the form of either special operations or special political action, and from undertaking training for such action. Special operations can be defined roughly as unorthodox, possibly paramilitary, activity in foreign countries designed to be used in case of war or some other crisis. Special political action is clandestine action against another country designed to further the foreign policy aims of a government, also in time of war or crisis. The development in ASIS of such a covert action capability had been accorded a priority well below that given to the development of ASIS's main intelligence gathering function, and had in practice consumed only a very small proportion of the organisation's manpower and resources. Development of this capability (as a contingency planning measure) had not proceeded very far at the time of the Sheraton incident, and-apart from such training-any action at all of this nature, either special operations or special political action, would have required prior Ministerial approval. The Report also recommends that the use by ASIS of weapons be terminated and that ASIS's stocks of weapons, including explosives, be disposed of. The Government has accepted and acted upon these recommendations. ASIS will not hold weapons and will not maintain a capability for special operations or special political action. Returning to the evaluation of agencies' performance, Mr Justice Hope finds that DSD is impressive (Gen., 2.30). Its activities have expanded since 1974, and its skills and technology have thus far substantially kept up with this expansion (Gen., 2.32). It complies with the obligations which law imposes upon it (Gen., 2.17). The Government has accepted and welcomes these generally reassuring findings in relation to the agencies. The Reports naturally contain recommendations aimed at further improving the performance of the agencies and at ensuring that they continue to act with legality and propriety. Other recommendations are directed to making the agencies more accountable. The Government endorses most of these and is pleased to note the ready support of the agencies for the additional measures which I will now outline. General Oversight and Accountability Principal responsibility for oversight and accountability will, naturally, continue to rest with Ministers. The Prime Minister, the Ministers for Foreign Affairs and Defence, and the Attorney-General-each of whom has direct Ministerial responsibility for one or more of the agencies-together with the Special Minister of State and Minister for Resources and Energy constitute the Security Committee of Cabinet. The Security Committee was established in recognition that there should be a small number of Ministers collectively tasked with developing policies for, and oversighting the performance of, the security and intelligence community. During the course of the Royal Commission the Committee deliberately, and properly, refrained from taking initiatives which would in any way have cut across His Honour's inquiry or anticipated his findings. Now, with the material contained in comprehensive reports before it and with other matters held in abeyance for the period of the Royal Commission, the Committee confronts a significant and challenging workload. The Government has responded with a number of initiatives. It has instituted a regular program of meetings for the Security Committee which will bring to the security and intelligence community a more rigorous oversight than ever before in this country. The Government believes that the agencies must benefit from having the clear guidance and directions on Government policy which will emanate from these regular programmed meetings of the Committee. To ensure that material comes before the Committee in a regular and orderly fashion, a suitably staffed, full-time Secretariat will be established in the Department of the Prime Minister and Cabinet. To strengthen its ability to advise the Security Committee on security matters, the Secretaries Committee on Intelligence and Security (S.C.I.S.) has been expanded to include the Secretaries of the Attorney-General's Department and the Department of the Special Minister of State. The Government has also affirmed the mandate of the S.C.I.S., its individual members, and other relevant agency heads for ensuring that the Committee of Ministers is kept regularly and fully informed of all relevant matters. Mr Justice Hope has made a number of recommendations also aimed at assisting Ministers in the discharge of these functions. I now wish to set out the Government's reaction to these recommendations. As the principal recommendation in the General Report, Mr Justice Hope recommends that there be created an Office of Inspector-General of Intelligence and Security which would perform the role of independent watchdog assisting Ministers in looking after the public interest in the proper functioning of the security and intelligence agencies. The Government accepts the recommendation, believing the proposed Office-covering as it does most of the functions of the Security Commissioner, including in particular the audit function, proposed in the ALP Submission to Mr Justice Hope-to be a valuable addition to the existing machinery. While the details will need to be finalised in legislation, the Government agrees with the thrust of what is proposed for the Office in the General Report (3.19-26) and ASIO Report (16.76-102). Basically, the Office will comprise an Inspector-General of appropriate standing, appointed after consultation with the Leader of the Opposition, and a small staff. For administrative purposes the office will be attached to the Prime Minister's portfolio. In relation to ASIO, the Inspector-General will be able to act on his or her own initiative, or at the request of the Attorney-General, or in response to a complaint, and will report his or her findings to the Attorney. The Inspector-General's functions and powers will also include: enquiring into and reporting to the Attorney-General on ASIO's compliance with the law and propriety; and, if required by the Attorney-General, on the appropriateness and effectiveness of particular internal procedures; having full access to ASIO's files and other materials and power to require answers to questions; and reviewing ASIO'S performance in opening, maintaining and culling files. In respect of the other agencies, the Inspector-General's functions will include: checking, as occasion requires, the legality and propriety of the activities of ASIS and DSD; Investigating and reporting upon matters referred by the Prime Minister and Minister for Defence in respect of ONA and J10 respectively; investigating the appropriateness and effectiveness of particular internal procedures of any agency if so required by the relevant Minister. The Inspector-General will produce an Annual Report which will be made available to the Parliament with such editing only as would be consistent with national security, privacy and other public interest considerations, and in an unexpurgated form to the Leader of the Opposition. Parliamentary Committee Mr Justice Hope has also given consideration to the need for a Parliamentary Committee and has concluded that it is neither necessary nor appropriate that a special Parliamentary Committee be established to improve accountability (Gen, 3.28, ASIO, 17.34). He does, however, emphasise that this is ultimately a matter for Parliament to decide. The Government has given a great deal of consideration to the question. It has weighed His Honour's comments about the adequacy of existing oversight and accountability measures-particularly when supplemented by the new office of Inspector-General. The Government accepts that these measures will be improved by the creation of the Office of Inspector-General. Nevertheless, it believes a further improvement can be obtained by directly involving the Parliament-on both sides and in both Houses-in imposing the discipline of an external scrutiny of the intelligence and security agencies quite independent of the Executive. While the Government has been conscious also of the need to carefully protect intelligence and security information, it believes that appropriate arrangements can be made to ensure that a small but informed Parliamentary Committee would operate effectively in the public interest. It notes, in this regard, relevant overseas experience of Parliamentary scrutiny of intelligence and security agencies. Although the Government will be consulting on the details of the Committee's operation, it would propose to establish the Committee by amendment to the ASIO Act, to oversight prescribed activities of ASIO relating to domestic security. The Committee would not act as a grievance mechanism-that role being given to the proposed Inspector-General-and appropriate safeguards for national security classified material would, of course, have to apply. In relation to ASIO this Joint Parliamentary Committee would supplement, not replace, the arrangements already in place for official briefings on national intelligence and security matters, on a personal and confidential basis, to nominated members of the Opposition (an approach which Mr Justice Hope has endorsed). Impact of Archives Act There is one final matter affecting the general accountability of the security and intelligence agencies which requires comment. In June 1984, this Government brought into operation the Archives Act to govern public access to Commonwealth records. Mr Justice Hope, in his General Report, has made recommendations relating to the impact of the Archives Act on the intelligence and security agencies. His Honour has raised a concern that the 30-year time limit which is applied to records under the Archives Act may be insufficient for many intelligence community records because release even after that lapse of time could still reveal sources, modus operandi and other security-sensitive information. His recommendation is that consideration be given to legislative amendments to remove operational records of security and intelligence agencies from the mandatory requirements of handover to Archives and public access after 30 years, leaving discretion with agency heads to hand over records when appropriate. The intelligence community has strongly supported Mr Justice Hope's recommendations and has raised with the Government its concerns about the adequacy of, and feasibility of applying, the safeguards in the Act against compromising the large volume of sensitive documents held, many of which have been provided in confidence by overseas sources. At the same time, the community acknowledges both that its records contain documents of major historical significance, and the Government's commitment to ensuring that these records are preserved and, where possible, made available for public access. The Government takes very seriously its duty to protect the confidentiality of intelligence, its sources and the means by which it is obtained. However, it believes that safeguards in the Archives Act have been appropriately designed and have not been shown to be deficient: the provisions of Section 29 of the Archives Act were developed to have the effect of exempting the intelligence agencies from the 'mandatory transfer' provision referred to by His Honour (Gen., 4.31); and beyond this, in the event of a request for access, the Act provides a range of exemption provisions and for conclusive Ministerial certificates to protect security sensitive information. The Government will ensure, however, that the intelligence community's concern and experiences are specifically addressed in the review of the Archives Act which is scheduled for 1987. ASIO Report Turning now to the Report on ASIO, I primarily wish to address four main groups of recommendations: those directed at strengthening Ministerial control; those relating to amendment of the ASIO Act to redefine ASIO's jurisdiction; those affecting the role of the Security Appeals Tribunal; and those proposing the gathering together of a range of protective security measures under the Special Minister of State. Strengthening of Ministerial Control Mr Justice Hope has recommended that the Attorney-General's control over ASIO be significantly expanded and his Department be given a larger role in support of him. He has proposed that the Director-General of Security, in the performance of his functions, be subject to the direction of the advice he should give (ASIO, 16.46). The proposal includes appropriate control mechanisms. The Government endorses his recommendations. His Honour has also recommended that the Attorney-General be given power to issue guidelines relating to a number of areas of ASIO activity. The guidelines will have the status of administrative directions; where appropriate will be tabled in Parliament; and will be given to the Leader of the Opposition. The areas to be covered will include intelligence collection, targetting, review of file holdings, and the extent of ASIO involvement in investigating activities which might involve the hindering of the Defence Force function (ASIO, 16.52). The Government endorses these recommendations, and has also decided that the Security Committee will approve the guidelines to be issued by the Attorney-General. Amendments to ASIO Act His Honour has recommended significant changes to the definition of 'security' contained in the ASIO Act. The effect of the changes proposed is to allow ASIO's functions and activities to be more carefully defined and limited (ASIO, Chapters 3, 4, 5). The Government accepts the main thrust of these recommendations. I don't intend repeating all of the details-I invite honourable Senators to give them careful study in the lead up to the future introduction of amendments to the ASIO Act. I will comment that the Government is particularly pleased that the general direction of the changes would: give full recognition to the policy that ASIO should not be concerned with the activities of persons which involve only lawful protest or dissent (ASIO, 4.91 (H)); see the term 'subversion' deleted from the definition of 'security' (ASIO, 5.54 (B)) in favour of a concept of 'politically motivated violence' which covers a much narrower definition of the contentious notion of 'subversion'; make separate provision dealing with activities directed to promoting violence between different communal groups (ASIO, 4.91(F));and delete the term 'active measures of foreign intervention' from the definition of 'security' and substitute a more tightly defined definition of 'acts of foreign interference' along the lines suggested by His Honour. Concern has been expressed in some quarters about the ambiguities and potential dangers inherent in the term 'agent of influence'. By changing the emphasis in the concept of 'foreign interference' from activities designed to advance the interests of a foreign country to activities that will have a result detrimental for Australia, this recommendation should allay those concerns. The Government also accepts Mr Justice Hope's recommendation that there should be separate provision dealing with activities directed to obstructing, hindering or interfering with the performance by the Defence Force of its Activities (ASIO, 4.91 (D)). The Government proposes to add to this provision as proposed by Mr Justice Hope a further requirement that the acts concerned be not only intended to, but likely to, obstruct, hinder or interfere. I reiterate that these provisions will be subject to the policy on lawful dissent. Another significant amendment of the ASIO Act would result from Mr Justice Hope's proposal that ASIO, under warrant, collect foreign intelligence in Australia-that is, information concerning the capabilities, policies and activities of foreign powers or bodies (ASIO, 6.82, 6.84, 6.87). His Honour concludes, and the Government agrees, that it would be highly advantageous for Australia to provide for the collection of such intelligence (ASIO, 6.80). The Government also agrees that if this is to be done it must be regulated by legislation (as is the case in the United States and Canada and as is being introduced in the United Kingdom), and any such legislation would need to ensure, as His Honour recognises, that no Australian person or corporation would be the target of operations involving such collection (ASIO, 6.84). We will be giving further consideration to the complex issues raised by this recommendation. Security Appeals Tribunal Mr Justice Hope recommends a number of procedural and jurisdictional changes for the Security Appeals Tribunal (S.A.T.). These stem from the requirement to report on whether there is adequate provision for effective redress for persons who may be unjustifiably disadvantaged by action of the agencies. With an exception I will now address, these recommendations will be the subject of a further Submission by the Attorney-General. As already mentioned, the Inspector-General of Intelligence and Security will be empowered, as part of improved redress procedures, to investigate complaints by individuals. Beyond this, Mr Justice Hope has recommended that in any case where a report by ASIO may result in action adverse to the interests of an individual, and where the individual does not already have a right to review of that report, the Attorney-General may refer the matter to the S.A.T. for advice on the appropriate procedures to be followed by the Government having regard to the interests of the person who is exposed to possible prejudice (ASIO, 17.58). It is suggested that the Tribunal could be asked to consider whether the person should be given notice and an opportunity of testing the ASIO information on which the Government is proposing to act or has taken interim action (ASIO, 17.58). The Government accepts the desirability of being able to draw on independent advice in the circumstances outlined. However, it is concerned that the recommendation may place the S.A.T., a quasi-judicial body, in the position of giving advice to Government on aspects of the handling of a developing security matter. The Government intends, therefore, to incorporate this advisory role in the functions of the proposed Inspector-General of Intelligence and Security. Protective Security Chapters 9-12 of the ASIO Report deal with protective security matters. Key recommendations set out at Chapter 12, paragraphs 77-79, are that the Special Minister of State be given responsibility for protective security policy and co-ordination, and that a high level committee be convened by the Department of the Special Minister of State to co-ordinate protective security measures, with representation from ASIO and other agencies with specialist security expertise, and from the major user departments. The Government recognises that under existing arrangements responsibility for protective security policy is vested in a number of departments and agencies. There is, therefore, some attraction to the idea of bringing protective security policy under one department and developing the machinery for co-ordination. Such a rationalisation inevitably carries with it resource and cost implications. Accordingly, the Government is carefully examining whether the benefits of centralisation outweigh these costs. ONA/JIO Report ONA After making his favourable findings about ONA, to which I referred earlier and which the Government endorses, Mr Justice Hope went on to suggest that there was scope for ONA more actively to encourage departments to recognise and use its analytical skills and to co-operate with it in its work (ONA/JIO, 3.163). To this end he suggested the establishment of a National Intelligence Committee, or N.I.C. (Gen., 2.38, ONA/JIO, 3.169-170, 5.47), chaired by ONA and including senior representatives of policy departments and JIO, with representatives of the intelligence collection agencies present as observers. The Government agrees with His Honour, and accordingly accepts the recommendations of paragraphs 3.169 (A) and (B) of the Report on ONA and JIO. Appropriate administrative action is being taken to give effect to that decision. Mr Justice Hope suggests four functions for the N.I.C., involving it in: the development of ONA's work program; monitoring ONA's product; advising ONA on intelligence needs and priorities; and considering all ONA's assessments. The Government agrees with the first three suggested functions for the N.I.C. Policy departments are already drawn into these things in a variety of ways, but it would be a useful improvement to have them done more formally, and in a multilateral way, in an N.I.C. The Government does not accept that the N.I.C. should be given the fourth recommended function-that of considering all ONA's assessments. In the Government's view this would result in a most unwieldy system, would greatly reduce ONA's output, would make very difficult the preservation of ONA's independence, and could quite easily lead to the introduction of departmental policy preferences into ONA's assessments. JIO As with his recommendations on ONA, Mr Justice Hope's main recommendations in respect of JIO are directed towards improving the process of consultation between JIO and its main customers. He also makes suggestions for improving JIO's organisation, manning, training, and some aspects of its co-ordination and forward planning. The Minister for Defence will be advising the Government on what action to take in response to the detailed recommendations and suggestions on the JIO. DSD Report As I have said, the DSD Report is not being published but it is appropriate at this stage to make some comment about the DSD charter. Following consideration of the reports of the earlier Royal Commission on Intelligence and Security, the then Prime Minister in 1977 broadly outlined the role and functions of DSD. Mr Justice Hope has now recommended that the Government consider making public the DSD Directive with amendments where necessary for security reasons. This Government has issued DSD with a new Directive which differs only slightly, and not in matters of substance, from the previous Directive under which DSD operated. We agree with Mr Justice Hope that publication on the Directive will allow the Australian public to obtain a clearer appreciation of DSD's role and functions and may allay misconceptions about the organisation. Concluding Remarks As I have indicated in this statement, the Government has accepted and welcomed His Honour's findings, and has accepted most of his principal recommendations. More work remains to be done in responding to his other recommendations and in the area of implementation. The Government will ensure that there is no delay to this work, and that its results will be made known as appropriate. When all is finished, I have no doubt that Australia's intelligence and security services will be more efficient and effective than they now are, that they will be run with even greater regard for legality and propriety, and that their accountability and oversight will be further strengthened. These will be worthwhile gains-to the Australian people, to the Australian Government, and to the Australian security and intelligence community itself. Defence Signals Directorate Directive 1. The Commonwealth Government requires the maintenance of a capability to collect, produce and disseminate foreign signal intelligence and to advise the Government on all matters pertaining to the security of signal communications and related equipments. 2. The capability will be located in: a. the organisation in the Department of Defence known as the ''Defence Signals Directorate'' (DSD); and b. specialist units of the Defence Force. FUNCTIONS 3. In respect of signal intelligence, the functions of DSD and the specialist units of the Defence Force referred to in paragraph 2 above shall be: a. to develop and maintain a capability to provide signal intelligence in support of the Defence Force; and b. to collect, produce and disseminate foreign signal intelligence to meet the national requirements of the Commonwealth Government. 4. In respect of communications security, the functions of DSD shall be: a. to provide materials, advice and assistance to Commonwealth Government departments and authorities and the Defence Force on matters relevant to the security of their communications and electronic and related activities; and b. through the Secretary to the Department of Defence, to keep the Secretaries' Committee on Intelligence and Security generally informed on the state of communications security. Organisational Principles 5. Policy control and managerial oversight over the national intelligence community, external and internal, is exercised by the Security Committee of Cabinet in respect of targets, priorities, activities, organisational requirements, broad allocation of resources, performance and co-ordination and inter-relationships of the various agencies. In the performance of its functions DSD, as a component of the national intelligence community, shall accept the guidance on targets and priorities issued from time to time by the Security Committee of Cabinet. 6. The Australian capability in signal intelligence shall be maintained in DSD and the Defence Force for national purposes generally. DSD shall be the national communications security advisory authority and as such shall maintain the expertise required to carry out those functions detailed in paragraph 4 above. 7. DSD shall be an outrider organisation in the Department of Defence. The Director, DSD shall control DSD and shall be responsible to the Secretary to the Department of Defence. 8. Specialist units of the Defence Force, and Defence Force personnel engaged in signal intelligence and communications security tasks, shall be subject to the command arrangements made by or under the authority of the Chief of the Defence Force. Members of the Defence Force may be loaned or seconded for service with DSD. Operating Guidelines 9. DSD and units of the Defence Force engaged in signal intelligence and communications security functions shall operate in conformity with Australian law. 10. DSD shall maintain direct contact with appropriate Commonwealth Government departments and authorities and the Defence Force as regards signal intelligence and communications security matters. 11. DSD shall be the Australian national authority on signal intelligence and communications security matters. DSD shall conduct liaison on signal intelligence and communications security matters on behalf of the Australian Government as appropriate with counterpart agencies or authorities in other countries and shall maintain overseas technical representation as is necessary. 12. The Director, DSD shall furnish to the Secretary to the Department of Defence and to the Chief of the Defence Force an Annual Report which shall include an account of the performance of DSD in relation to the functions stated in paragraphs 3 and 4 above. Senator BUTTON —I move: That the Senate take note of the statement. Senator DURACK(Western Australia)(3.02) —The Opposition welcomes the tabling of the report of the Royal Commission on Australia's Security and Intelligence Agencies by Mr Justice Hope, in discharge of his commission to investigate Australia's security and intelligence agencies. The report, of course, not only deals with a most important subject but also is delivered by a man of very high authority on that subject who has, in these reports, again demonstrated his deep understanding of the problems of intelligence and security and the need for such organisations and his ability to make valuable contributions about their work and role and about the legislation governing them. Mr Justice Hope was first appointed a royal commissioner for the Royal Commission into Intelligence and Security in 1974. His final reports to the Fraser Government in 1976 and 1977 were a thoroughgoing review of Australia's intelligence and security bodies which made a large number of recommendations about them and about legislation in respect of them, which were largely implemented by the Fraser Government in succeeding years, particularly with the Australian Security Intelligence Organisation Act in 1979 and the establishment of the Office of National Assessments, known as ONA. It was certainly always the view of the former Government that from time to time there should be a judicial audit, namely, an external review by a judicial officer, of the way the organisations were working. That was made clear when the present Director-General of Security, Mr Barnett, was appointed in 1981. Therefore, when this Government decided to appoint Mr Justice Hope as a royal commissioner on Australia's security and intelligence agencies in May 1983, that decision was welcomed and supported by the Opposition, despite the fact that his appointment was somewhat accelerated and a lot of his early period as the royal commissioner was taken up with investigating the Combe-Ivanov affair. This exercise has now culminated in these reports, which were made to the Government in December last and which are now tabled in this Parliament together with a statement by the Prime Minister (Mr Hawke), which has been tabled and incorporated in Hansard by the Leader of the Government in the Senate (Senator Button). This completes the work of a general review of Australia's security and intelligence agencies and, as I have said, it makes a large number of important and interesting recommendations. Of course, they will have to be the subject of a great deal of attention by the Government and the Opposition and by this Parliament in due course. No doubt, legislation will be brought forward and will be debated in this chamber. Also, numerous recommendations can be given effect to by administrative action. No doubt the Government and the intelligence agencies will be directing their minds to those matters. The overwhelming matter which emerges from this report is the very favourable bill of health that Mr Justice Hope gives to intelligence agencies in Australia. Of course, these include not only the Australian Security Intelligence Organisation but also the Australia Secret Intelligence Service, the Office of National Assessments, the Joint Intelligence Organisation and the Defence Signals Directorate. In the time available, I will concentrate my remarks on ASIO, but it is important to recognise that the findings of Mr Justice Hope were made in relation to all the intelligence and security agencies. In his general report, under the heading 'Value of intelligence services', Mr Justice Hope says, referring to the Royal Commission into Intelligence and Security-that was his earlier inquiry: . . . I reported that Australia needs intelligence of quality, timeliness and relevance, and that for this purpose it requires to have a highly professional system of intelligence and security services. These needs are as important now as they were a decade ago, and indeed the matters in respect of which Australia requires intelligence have expanded considerably. The product of Australia's intelligence services is of great value to the nation. No doubt there will always be room for improvement, and no doubt their need for resources will always have to be measured against the proper claims of other national interests. I am satisfied, however-- this is Mr Justice Hope's final conclusion- that Australia's investment in its intelligence services is well justified, and that governments should continue to ensure that they are able to fulfil the important roles they play in helping to advise and protect Australia's national interests. That finding by Mr Justice Hope after his second inquiry into Australia's intelligence services and agencies, that conclusion by a man of his experience and proven record, is of the utmost importance. Of course, it is in great contrast to the sort of rubbish that is constantly expressed in the media and in this Parliament including, I am sad to say, in this Senate from time to time, about Australia's intelligence agencies, and to the muck-raking, cynicism, abuse and snide remarks that so frequently emanate particularly from the left wing of the Australian Labor Party and sections of the media about these vitally important bodies. It is very valuable, sobering and important that we should have a contribution of this kind from a man such as Mr Justice Hope. I and the Opposition greatly welcome the way in which he has expressed his conclusions and emphasised the importance of the work of these agencies and the need for them. It is very interesting, for instance, that, after so much unfavourable publicity in recent times about ASIS, the statement that the Leader of the Government has put down refers to ASIS as having achieved success over the last decade. In referring to Mr Justice Hope's conclusions, it states: ASIS has achieved success over the last decade in organising and reorganising to achieve its goals . . . its effectiveness and efficiency, and its contribution to Australia's intelligence, will continue to grow as a consequence of the closer relationship with other areas of government . . . I particularly wish to quote this part: The Sheraton Hotel incident was not representative of the quality or professionalism exhibited by ASIS in performing its principal tasks. As I have said, the intelligence agencies, particularly ASIO and ASIS, are always good for a headline when something goes wrong or extravagant claims are made about them. Unfortunately, the public is always served with criticism, and often quite extravagant criticism, of these agencies. Yet here we have a report, following close investigation of these agencies over a period of 18 months, by a man of the highest authority, in which he puts into perspective the true position of these agencies and explains the true value of their work. It is very heartening to read conclusions of that kind. As I said, the Sheraton Hotel incident was not representative of the quality of the work of ASIS. I wish to turn now to deal particularly with the Australian Security Intelligence Organisation, which certainly figures in the major report that has been tabled. There are confidential reports about the other agencies but the Australian Security Intelligence Organisation, the body on which the most information has been made available and which seems, sadly, always to attract the greatest attention and suffer the greatest misrepresentation, is the subject of a very substantial report that has been tabled today. Mr Justice Hope has made some very interesting and important remarks and has drawn conclusions about ASIO which we welcome and which I think put ASIO in a proper perspective. He makes the point, and this is a very important point, that he investigated ASIO in 1974-75 and reported upon it in 1976. He returned to look at it again in 1983-84. Of course, in that time so much of his earlier recommendations have been implemented and the Organisation has changed considerably. He recognises this when he states: The ASIO that I have reviewed is very different from the ASIO that I got to know during the RCIS. that was his earlier royal commission-- It has broken away from the rather unthinking pursuit of old targets, and the laxity of standards that characterised the Organisation then. ASIO as it operates now under the present Act is more focussed in its activities and much more conscious of the sensitivities pertaining to, and the proper limits of, its activities. Later in the report he states: My overall view is that ASIO has properly served the interests of the Australian people and Government in recent years and that it has done so with a fair degree of effectiveness. Those are very welcome conclusions. It is very welcome to have the work of such an important body as ASIO put into this proper perspective by a man with the authority to do so. I hope that this will go a long way to providing ASIO with a much more responsible Press than it has received in the past, and that it will go a long way to eliminating the sort of unthinking criticism which has been directed at the organisation, particularly in the last couple of years. Unfortunately, we cannot escape the conclusion that ASIO has suffered by this constant attack which it is unable to answer. In Mr Justice Hope's general report he states: Morale is an important factor in achieving effectiveness and efficiency. ASIO's morale is not high at the present time. There are several reasons for this. One of the more important reasons is the battering (in my opinion quite unjustified, except in relation to a limited number of mistakes which it made in its reports of facts) which it took from the media at the time of the inquiry into the Ivanov-Combe affair. Time will heal that scar, but it is incumbent on those responsible for leading the organisation to restore the firm belief which its officers must have in ASIO's purpose, and in the importance of that purpose to the nation. It is a worrying finding that morale in the Organisation is not high at present. There may be reasons for it. Undoubtedly, that comes not only from the battering to which Mr Justice Hope refers but also, as I have said, from the constant snide remarks, cynicism, extravagant complaints and claims that have been made about it and have been fuelled by the media. These have led ultimately to this loss of morale. This report by Mr Justice Hope will, if properly reported and properly understood by the critics of ASIO, go a long way to restoring morale. As I have said, since Mr Justice Hope's previous report, a great deal of work has been done since to build up the Organisation, to give it better leadership and better resources and thereby to increase its morale and effectiveness. That was certainly being achieved and had been largely successful until the events of a couple of years ago. I hope that, by the Government acting on Mr Justice Hope's expressions of concern about these matters and maintaining the Organisation's resources, that problem will be overcome. It is interesting to note Mr Justice Hope's summary of the increased resources, both financial and staff, that were made available to the Organisation over the years following his previous report, principally during the term of the Fraser Government. This is mentioned in his report on ASIO, in which he states: Its expenditure grew from $7.8m in 1976-77 to $27.176m in 1983-84 . . . In real terms there has been an increase of 122% over this period. This represents a significant increase in resources. Staff numbers have increased by 42% between 1 July 1977 and 1 July 1984. During the period, ASIO improved its recruitment processes and attracted large numbers of young graduates for whom it devised a 'generalist intelligence officer' career program, involving training and experience throughout the organisation. This recruitment process has given ASIO staffing a noticeable 'new look'. That summarises, in a very practical way, the changes that have been made to ASIO in recent years and the very great increase in its professionalism. Elsewhere in Mr Justice Hope's report he recognises-I would like to add my own comment in support of this recognition-the leadership that was given to the organisation by Mr Justice Woodward during his term as the Director-General of Security. This work has been carried on successfully-this is also recognised by Mr Justice Hope-by the present Director-General of Security, Mr Harvey Barnett. I turn from the discussion of the general findings about ASIO and the changes that have been made to the Organisation and the professional standing it has been able to achieve despite various batterings that it has received, to some of the more specific recommendations that Mr Justice Hope has made. Clearly, one of the major problems for a secret intelligence organisation is the way in which it can defend itself or it can be defended in public and at the same time not be compromised in its very nature as a secret intelligence organisation. The problem has been that extravagant complaints and criticisms are made which mostly cannot be answered. We are all familiar in this chamber with the rule that successive governments have adopted of not commenting on matters relating to security where some of the most extravagant and untrue allegations are made. This puts a strain on the Organisation and does add to the problems of morale. Mr Justice Hope recommends that this policy should be continued. He states: I have concluded that the interests of Australia would be best served by an adherence to the traditional practice except in very special circumstances, whether the allegations are correct or incorrect. The only question I raise is whether there should ever be any exceptions to that rule because once exceptions are made the question will always be asked, if the Government has made a statement in respect of one particular allegation and refuses to make one on another, whether it is perhaps thereby indirectly admitting that such an allegation was correct. It is a very awkward problem. A much greater understanding is required by members of parliament, who should be exhibiting a great degree of responsibility in regard to these questions. Mr Justice Hope has tackled some of the major issues. His recommendations cannot be gone into now because time does not permit it. But he has faced up to the very sensitive questions of the accountability and relationship of ASIO to the Minister responsible for it and the government of the day. He has faced up to the questions of the nature of its charter, problems relating to definitions of subversion and matters of that kind. There are recommendations on all these matters. He has recommended the creation of a new body or office of Inspector General of Intelligence and Security. That recommendation is in lieu of the sort of regular judicial audit which he has conducted on this occasion. He suggests that there should be the appointment of an office of this kind and that that should be an ongoing process-an ombudsman for the security and intelligence agencies. I think that is one of the major recommendations that he has made. The recommendation is certainly one that the Opposition can understand and it has merit. We will give great consideration to it. The concern we have, as Mr Justice Hope appreciates, is whether a body of that kind would interfere with the important relationship between the Director-General of Security and the Attorney-General who is in charge of the Organisation. It sometimes involves the Prime Minister. That constant line of communication and that very important responsibility must be preserved and the creation of a new office of Inspector General of Security could cause problems in that regard and, therefore, it will have to be given closer consideration. Mr Justice Hope, however, rejects the proposal for an external review by a parliamentary committee. In that respect the Opposition will certainly welcome Mr Justice Hope's recommendation. We would be opposed to the Government's rejection of that recommendation. In the ministerial statement the Government has rejected Mr Justice Hope's recommendation that there should not be a parliamentary committee. It has done so obviously because of the ideological pressures that have been brought to bear by the very elements in the Australian Labor Party which have done so much to create the sorts of problems for ASIO which I have been dealing with, which are set out in Mr Justice Hope's report. In relation to the discharge of ministerial responsibility in relation to ASIO, Mr Justice Hope recognises the fact that there must be some limits on ministerial control. As I understand it, the Labor Party's submission to Mr Justice Hope was to give unlimited ministerial control over ASIO. Mr Justice Hope has rejected that and has made other suggestions, all of which are very valuable and must be given further consideration. He recognises this great danger that unlimited, unfettered ministerial control of ASIO could lead to the misuse of ministerial power, for political reasons, by the Minister or the government of the day. That is one of the sensitive areas of the present Act, which provides mechanisms to prevent that occurring and to prevent a Minister being able to demand information about an individual or to order inquiries to be made in relation to an individual. I think that is a very important protection of individual rights. It is a protection for the Minister who is responsible for ASIO and a protection for the Organisation itself against a Minister who may be tempted to use it for improper purposes. Very great care must be taken in how that relationship is defined. Mr Justice Hope is well aware of that problem and his recommendations for making some further changes in the Act in that respect, as in many other areas, deserve close and sympathetic consideration. In conclusion, these are most valuable and important reports which deserve a great deal more study and attention by the Government and by members of this chamber and the other place. The legislation which no doubt will be brought in will be another opportunity to debate them here. The Opposition is very relieved indeed by the findings of the report in relation to the way in which these organisations have performed and their importance. I hope that a number of the comments and findings that Mr Justice Hope has made, particularly where he reports the investigations that he made of complaints he received, will be noted. He shows how little substance-in fact, in most cases no substance-there seems to have been in almost all of the complaints that he received. The only thing that surprises me is that he did not receive more complaints in view of the sort of misrepresentation and the extravagant comments that are made so much of in the media about these organisations. Mr Justice Hope has gone to great lengths to investigate these complaints and to lay to rest the concerns that have been created in many people's minds because of them. This is very satisfactory and I think we can all take great satisfaction in the findings that he has made, the very sober reports that he has given us and the very strong support that he has given to the need to have well resourced and effective intelligence and security organisations. (Quorum formed) Senator HAINES(South Australia)(3.34) —I begin my comments today by commending the work of Mr Justice Hope in producing the report of the Royal Commission on Australia's Security and Intelligence Agencies and by welcoming the contents of the documents that we have before us. In general I must say on behalf of the Australian Democrats that we are favourably disposed to many of the recommendations contained in the documents, but I must stress that it is important that time be given for detailed evaluation. We have been given some four hours between the receipt of these reports and the debate coming on today and that is hardly time enough for any political party or any senator to come to definitive conclusions and make definitive statements. Senator Button —Don't be so modest, I think you can handle it. Senator HAINES —Thank you, Senator. I am not so sure that that confidence is justified. Nevertheless, I repeat that it is important that time be given for detailed evaluation so that we do not rush into decisions that could be seen as purely political, particularly if they run contrary to recommendations made by Mr Justice Hope in the report. The most significant features of the documents before us today undoubtedly include the appointment of the Inspector-General as a sort of ombudsman, the disarming, so to speak, of the Australian Secret Intelligence Service, after the unfortunate Sheraton incident, the whole question of whether there should be a joint parliamentary committee to oversee the operations of our security organisations-a committee that presumably would operate in a similar fashion to the Joint Parliamentary Committee on the National Crime Authority-the change to the Australian Security Intelligence Organisation requiring a more clearly defined attitude to lawful political dissent, the tightening of the concepts of 'agent of influence' arising of course out of the Combe-Ivanov affair, and finally, the removal of the covert operations capability of ASIS. It is unquestionable that if the work that Mr Justice Hope has done is brought to fruition through government action and if the majority of the recommendations are taken into account the result must be a better intelligence operations system in Australia. The Hope Royal Commission was established, as has already been indicated by Senator Durack, in May 1983 to undertake a major review of Australia's security and intelligence services. It reported in December of that year on the Combe-Ivanov affair. It reported again in February 1984 on the Sheraton Hotel incident and its final report of December last year is the report that has been tabled today. It speaks volumes for the experience and ability of Mr Justice Hope that so much has been achieved by him in such a relatively short time. These final reports comprise a general report and individual reports on ASIO, ASIS and the Defence Signals Directorate and a combined report on the Office of National Assessments and the Joint Intelligence Organisation. I understand the Government consulted with Mr Justice Hope about the publication of these reports and it is tabling an edited version of the general, ASIO and combined ONA-JIO reports but not the ASIS or the DSD reports. The Government has not yet reached a final position on the hundreds of recommendations and suggestions that have been made, and nor should it in view of the comments that I made a few moments ago. But it has responded to the major findings and recommendations and these have been outlined in the statement by the Leader of the Government in the Senate (Senator Button) today on the final report of the Hope Royal Commission. As the Minister has already said, Mr Justice Hope reiterated in the report his view that Australia needs intelligence of quality, timeliness and relevance and requires a highly professional system of intelligence and security services. That is something which I suspect a lot of people thought we lacked, as a result of that Mickey Mouse incident some months back. The Government endorses this view, as do the Australian Democrats and, I suggest, as do most reasonable people. Mr Justice Hope concluded that, while there are deficiencies in some agencies-and I suspect that our previous Attorney-General who had to field questions over this last year would endorse that-generally they are performing efficiently and effectively. According to him, ASIO has improved its structure, making it more responsive to pre-determined policies and ensuring that it operates within its charter. He has, however, called for improvement in its management and administration. Among other things, Mr Justice Hope notes that ONA is held in high regard by other intelligence agencies-although I am not sure whether that says a great deal sometimes-and produces valuable intelligence reports. He notes that the JIO is competent and professional and produces work of a high standard and that ASIS has achieved success in its reorganisation. He asserts that the Sheraton Hotel incident was not representative and that firm steps have been taken to ensure that there will be no repetition of the incident. It is worth noting that Mr Justice Hope recommends that the ASIS directive be amended to exclude covert actions in the form either of special operations or special political action and the undertaking of training for such action. Development of this capability had not proceeded very far at the time of the Sheraton incident for which, one presumes, we must be all duly thankful. Mr Justice Hope also recommends that the use of weapons by ASIS be terminated and that current stocks be disposed of. The Government, not unreasonably, has accepted this suggestion. Mr Justice Hope also notes that DSD is impressive and that it complies with its legal obligations. Again, I am sure that all people listening will be pleased about that. Turning to the detail of the report, Mr Justice Hope acknowledges that the principal responsibility for general oversight and accountability will continue to rest with Ministers, as indeed it should. I understand that the national security committee of cabinet is to look at the recommendations, that a full time secretariat is to be established and that the secretaries' committee on intelligence and security will be expanded. The principal recommendation in the general report concerns the creation of an Office of Inspector-General of Intelligence and Security to act as an independent watchdog. We support this recommendation, as does the Government. Mr Justice Hope concluded that a special parliamentary committee was not necessary or appropriate. However, apparently the Government believes that a joint parliamentary committee of the sort which was established in tandem with the National Crime Authority is desirable. This is far too important an issue for us to comment on at the moment. It is impossible to evaluate whether a joint parliamentary committee is desirable or whether it would be effective without proper and serious considerations. I trust that the Government is not going to rush into any action on this matter without taking the proper amount of time over it and without giving other members of parliament and organisations the opportunity to give it the same sort of consideration. On the question of public access to Commonwealth records via the Archives Act, Mr Justice Hope considers that the 30-year time limit may be insufficient as far as intelligence community records are concerned. On the other hand, the Government appears to believe that the safeguards in the Act are adequate as far as exemption provisions with regard to sensitive material and so on are concerned. Again, I say that further considerations are needed before action is taken. I cannot stress enough that precipitate political action in security areas such as this can only do more harm than good. As far as ASIO is concerned, there are four main groups of recommendations within the reports. These are the strengthening of ministerial control, with which the Government concurs; amendments to the ASIO Act to define more carefully its functions, again the Government agrees with this; and that procedural and jurisdictional changes to the Security Appeals Tribunal be implemented. I gather that these are to be the subject of a further submission by the Attorney-General (Mr Lionel Bowen). There is a separate recommendation with regard to the advisory role of the SAT. I understand that the Government believes that this role should be given to the proposed Inspector-General. Again, I suggest that some time be taken before a decision is made. The fourth group of recommendations concerns the responsibility for protective security which is to go to the Department of the Special Minister of State and that a committee be convened. The Government is still considering this recommendation. As far as the joint ONA-JIO report is concerned, Mr Justice Hope suggests the establishment of a national intelligence committee, chaired by ONA and including senior representatives of policy departments and JIO, with representatives of the intelligence collection agencies as observers. The Government agrees with three out of four of the suggested functions of the NIC but not with the fourth recommendation, namely, that of considering all ONA's assessments. In regard to JIO, Mr Justice Hope's suggestions are directed towards improving the process of consultation between that organisation and its main customers. I understand that the Minister for Defence (Mr Beazley) is in the process of advising the Government with regard to this matter. To this stage the Defence Signals Directorate report has not been published. Mr Justice Hope has recommended making the DSD directive public, with amendments where necessary for security reasons. I gather that the Government will do so. In conclusion, for the time being I endorse the Government's expression of thanks to Mr Justice Hope for having completed what was undoubtedly a very difficult task, with distinction. As I said a moment ago, no doubt as a result of his work and the implementation of all or some of his recommendations, Australia will have better, more efficient intelligence organisations at work. Mr Acting Deputy President, I seek leave to continue my remarks later. Leave granted; debate adjourned. The ACTING DEPUTY PRESIDENT(Senator Townley) —I advise the Senate that Mr President has received a letter from the Acting Auditor-General responding to comments in the reports of Estimates Committee A and Estimates Committee B on the timing of the presentation of the Auditor-General's report on audits completed at 31 December 1984. I table a copy of the letter for the information of honourable senators. I indicate that Mr President has forwarded copies to the Chairmen of all Estimates committees and to the Manager of Government Business in the Senate. The ACTING DEPUTY PRESIDENT(Senator Townley) —I have received a letter from Senator Haines proposing that a matter of public importance be submitted to the Senate for discussion, namely: The need for the Commonwealth Government to fund programs to counteract the increasing social problem of violence against women and children. I call upon those senators who approve of the proposed discussion to rise in their places. More than the number of senators required by the Standing Orders having risen in their places- Senator HAINES(South Australia)(3.50) —I think it is rather ironic that I have just finished speaking on Australia's security and intelligence agencies and now am about to launch into a discussion about the lack of security and very limited intelligence that we have on behaviour, particularly violent behaviour, towards women and children. I do not think it is excessive to say that one of the more disturbing elements of modern society is unquestionably the matter of violence towards women and children and the fact that in some 80 per cent of those incidents of violence the perpetrator is a close relative or friend. This is not to say that violence against women and children has been unknown in the past, because that is not so. What is so disturbing about the incidents of assault, sexual assault, rape and incest, as well as various forms of psychological and emotional trauma visited on women and children by the men closest to them, is the fact that we are allegedly living in a civilised society where men and women are supposedly equal and where the vulnerability of children should be recognised. Yet we are currently faced with a situation in which the majority of victims in cases of domestic murder are women. An estimated 30,000 to 100,000 cases of incest occur in Australia every year. In fact a total of 1,578 sexual assaults on children were reported to a single agency last year, namely, the Department of Youth and Community Services child protection hotline in New South Wales. An article in Police Life of March this year in Victoria said that 83 per cent of sexual abuse cases were committed by a trusted friend or family member, and there is still a deplorable tendency for some sections in the community to pretend that a lot of this does not happen, but that if it does the victims themselves were largely responsible because of some form of inappropriate behaviour on their part. I acknowledge that the extent of violence against women is very hard to assess. Inadequate statistics, under-reporting, arrest avoidance and a reluctance to take legal action for a variety of reasons, including the horrors sometimes of court proceedings, are just some of the factors that make an accurate assessment of the situation practically impossible. But the statistics which are available indicate that the problem is widespread, that it occurs across all age, social, economic and ethnic ranges and that it is a huge drain on resources, ranging from law enforcement to social welfare, to health care. The most useful indicators as far as the widespreadedness, so to speak, of this problem come from accommodation figures in women's refuges and crisis care accommodation centres, although some States, such as New South Wales and South Australia, are keeping reasonable statistics through collating police and crime statistics. Nevertheless, community, police, legal and government responses to the problem leave much to be desired. It would surprise no one to hear that law enforcement agencies are frequently called to situations involving family violence. It has been reported for many years that the only mention of domestic violence made to police officers in training situations has been a negative one. They are told that, as far as possible, they should avoid becoming involved in domestic arguments. They are told that the parties are likely to unite again and generally to unite against the well-meaning police officer. In fact, of course, many women who are victims of criminal assault at home put up with the violence rather than call the police. Yet as it is a crime to beat, bash and abuse another human being, presumably including the human being to whom one happens to be married-although I understand there are some people who would question that-the question which arises is: Why, when police are called by a victim, do they still fail in some States to take action which they would otherwise have taken if a stranger beat, bashed or abused another person on the street? There is no question that a regrettable double standard exists in this situation. An extract from the book Even in the Best of Homes typifies this sort of situation. The woman wrote: I called the police several times. Sometimes I went to the police station. They didn't come every time I called. They told me they didn't like being involved in domestic violence. They told me there was nothing they could do. They told me to tell my lawyers to get off their-- expletive deleted- and do something . . . She pointed out at that stage that she had a court injunction to protect her from violence but that it was not very satisfactory. She said: Often my husband had fled the scene by the time they arrived. He conveniently came back every time . . . they left . . . I was usually sporting huge bruises whenever I saw them, and once my step-daughter came home in the middle of it and rang the police herself, but even that didn't make any difference. They still said they couldn't arrest him, or charge him with anything or do anything at all. I begin to wonder what the police are for. When we consider the difference between the police action in that sort of case and what it would have been if two strangers had been indulging in one-sided fisticuffs, we realise she is probably quite right. Again, there is probably no need in this place to canvass the sorry history of laws which, for a long time, enshrined the traditional right of a man to rule his household, including the euphemistically described right of chastisement. There are still men today who argue that a man has every right to give his spouse a clip around the ears when she does not do what he wants, and that may range from getting his tea on the table when he comes home to providing sexual services whenever he demands it. Wife beating, of course, is no longer explicitly condoned by society or by the law, but the persistent belief that it may be justifiable has frequently rendered such legal sanctions as do exist ineffective. There is an obvious legislative and judicial reluctance to place a wife's safety before the liberty of the husband. In fact, it is often said in rape cases that it is better that 10 women be raped and the rapist be not caught than that one innocent man be unfairly tried. I do not know that that ever applies to crimes against property. It certainly seems to apply to crimes against women. The requirement of proof beyond a reasonable doubt in criminal law is inherently difficult to achieve in situations of family violence because witnesses are rare and those witnesses who are present are often very young children and counter allegations are common. A review of the legal remedies available to victims of family violence reveals several glaring weaknesses, including the lack of immediate protection for threatened victims, the inadequate enforcement of existing sanctions, the limited legal protection available to people not legally married but whose relationship exposes them to the same threats, the inability of the court system to direct the parties to support services-indeed, the limited number of support services which are available-and of the courts to require the parties to negotiate a constructive resolution to the problem, and, finally, the enormous social, emotional and financial costs to the victims of family violence. The ultimate goal of legal reforms, I would suggest, must be the embodiment of the two aspects of protection: First, to remove immediate sources of danger, and to deter future resort to violence as a secondary measure. Only strong law enforcement will demonstrate that society opposes the use of physical force as a means of resolving disputes, whatever the circumstances. Unfortunately, all too often society is presented with, for its approval, quite the reverse of that. An article in the West Australian of 13 April this year, headed 'Macho figures take some blame', states: Macho heroes such as actor Clint Eastwood have a lot to answer for . . . The ideals they stand for-male dominance, female subjection, violence as the way of dealing with most problems-provide a social climate in which rapists thrive. Indeed, it is a climate in which violent men can justify their behaviour. The courts also have a case to answer as far as their treatment of incest is concerned. I refer to an article in the Sydney Morning Herald earlier this year headed 'Pity for the ''poor'' molester, but no justice'. The reporter notes: The criminal justice system has all but broken down in incest cases, according to experts in this field . . . the Family Court is also far too lenient in granting access to victims. One of the cases reported said that a mother was distraught because she discovered: . . . her husband had been committing bizarre sexual practices on their two young children, both under the age of seven. She then discovered, to her concern, that that man will get off scott-free and will still have access to the children. Many people are concerned that many offenders found guilty even of the serious crime of rape are released on bonds and are given access to their families. Julie Stewart, the co-ordinator of the Women's Legal Resource Centre, said: When offenders can rape their children usually with impunity and can get access to their children through the Family Court, as now happens on a large scale, it shows just how hopeless the system is. That also contradicts a comment that was made in Adelaide recently by a gentleman from the Central Methodist Mission who said that even when there is a hint of violence husbands are not given access to their children. That is patently false. We also need to challenge the myth of the Lolita figure-the argument that girls, in particular, entice or encourage their fathers to assault them sexually. One wonders after one has been to a place such as the Adelaide Children's Hospital or talked to anybody else who has had dealings in this area how an 18-month old baby girl can entice anyone to do anything. Society needs to assess the myths that it throws up to justify its frequent lack of action in this area. We also need to end the myth that if women behaved appropriately the bashings they are sometimes forced to undergo would not occur. The Age in April ran a story entitled 'The blind distress of deserted wife-bashers' in which it is said: These men often insisted that everything would be fine when their partners returned home. The article stated that the men felt that their wives tended to over-react and that it would all get sorted out if the two could only get back together again. They would behave in an embarrassed way and describe their behaviour as a regrettable loss of control, usually associated in their minds with drinking; or deny it; or dismiss their actions as just a shove or a clip over the ear. The article continued: Generally they seemed to believe that it was up to their partners to behave in a way which would not incite them-that is the men-to violence. They often thought, however, that their partners had problems ranging from over-sensitivity, to being unable to control the kids, or failing to learn to stay out of the man's way when he had had a hard day-- A classic case of blaming the victim. Where do we go from here? That the problem is there is undeniable. That resources are limited and often inappropriately extended is also undeniable. It is important then that the services that we offer women and children to whom violence has become a way of life are orientated towards the family as a whole. Two crucial aspects I think need to be stressed when considering the sorts of services that governments should be providing. First, they must not be developed as a replacement for the refuge system or used as an excuse to curtail the much needed extension of that system. There is no question at all in my mind or those of many other people that when women are fleeing from an intolerable and violent situation what they need most is the psychological, emotional and counselling support of other women who understand what they have been through. They do not need to be immediately judged, questioned or asked to consider how they have exacerbated or brought on the problem. Those services must not only be maintained; they must also be expanded. We must also recognise the inequalities of power within domestic relationships and acknowledge that they themselves bring on many of the problems. Various reports have argued for a range of services to assist families in crisis. These reports always stress their support for refuges as well as advocating more broadly based community crisis intervention services. These centres would act as a focus for information and contact with government and voluntary services. The services need to encompass counselling and support to the family as a whole or to violent men independently. They need to incorporate referral to legal and other welfare services, as well as mediation, and they need to provide 24-hour crisis counselling such as, for example, in South Australia's crisis care unit which aims to cater for all personal emergencies in consultation with other services where necessary. Mr David Wehner, a clinical psychologist who founded the South Australian domestic violence response team, was reported in an article in the Canberra Times. The article stated: . . . if the Government investigated the causes of and solutions to wife and child battering as eagerly as it did for AIDS and cancer research, answers could be quickly found. 'If the community gave resources into the area of spouse abuse in proportion to the population seriously at risk . . . we probably would not have such a big problem,' he said. Mr Wehner . . . was very critical of the Government for failing to recognise the cost and extent of domestic violence. He said research in South Australia had shown that 10 per cent of Adelaide families were affected by domestic violence and the total cost to the State was between $7 million and $10 million. Police were called to 20,000 domestic conflicts a year, general practitioners were seeing three or four battered women every two weeks and women's shelters were overrun. Something similar was thrown up in an investigation in the Australian Capital Territory last year. The article went on to state: Mr Wehner said successive governments had ignored the problems and the situation had been compounded by the criminal justice system which had abdicated its responsibility by either not charging or not punishing offenders . . . 'If the Government was serious they would not only be funding shelters and increasing the number of shelters they would be addressing the men, the offenders, systematically. 'There is no excuse for not coming up with a systematic analysis of the problem and designing and implementing an intervention system . . . I would say that most of us would heartily agree with that. It was very disappointing therefore to note a few weeks ago that one of the very few access hand-over centres in Australia is in danger of folding for lack of Federal funding. It was a pilot project which operated in Adelaide and which had proved its effectiveness in assisting women to hand over their children to husbands who had a history of violence. It has got to the stage where some organisations in South Australia are actually encouraging women not to comply with access orders if it means that they or their children are likely to be placed in a vulnerable position. There are means by which governments can provide services and assistance to these people. For example, it has been done in Santa Clara in California and in other parts of the world to assist children who suffer from incest and women who suffer from domestic violence. There is no reason why, with good will and sufficient funding, similar assistance could not be provided to Australian women and children. (Quorum formed) Senator WALTERS(Tasmania)(4.11) —I am delighted that the Australian Democrats have highlighted as a matter of public importance this very important subject of the increasing social problem of violence against women and children. Senator Haines spoke at length on it, but she did not speak at any great length-indeed, less than five minutes-on the need for the Commonwealth Government to fund programs to counteract this problem. I understand that, because it is a very difficult area. I will come to it later. The problem is largely a hidden one; it is rarely spoken of. Families do not like airing their private problems in public, so we find that counselling services rarely get the information they need before the problem is well developed. Whilst we recognise that this is an area which is of growing concern to the community, there are only a handful of reports from State governments and there are none from the Federal Government on the subject. Even though the awareness is increasing, the reports should be more plentiful. The lack of reports is not surprising, I suppose; how can we legislate for decent human behaviour? Senator Haines, in her desire to alleviate the problem, has suggested that it can be overcome by Commonwealth funding to counteract that violence. I think 'alleviate' may have been a better word to use than 'counteract'. I have spoken to groups of women who are affected by this tremendous problem, and even they find it very difficult to come up with sensible legal solutions with which they would be happy. Indeed, Al-Anon, which is one group of women which is very active in Tasmania, has said that most violence is associated with spouses who have an alcohol problem. The women are very definite about the fact that they will not accept money from any source at all. They have a rule that they raise any money they need, because they underline that they are a self-help group and it is only through self-help that this problem can be overcome. It is through encouragement to the members of their group that they are able to educate each other on how to alleviate the problem. Last year the then Attorney-General signed a reference to the Australian Law Reform Commission to inquire into the legal and non-legal problems of domestic violence in the Australian Capital Territory. That sounded all very good, but the Australian Capital Territory is the last jurisdiction in Australia to look at this problem of domestic violence. The reference to the Commission limits the inquiry to violence between adults, whether or not they are married or living together, and ignores completely the area of children. I believe that is a great pity. A report in the Canberra Times of 23 October 1984 gave us some indication of the findings of a phone-in that was held last year in the Australian Capital Territory. It states: Preliminary findings of a recent phone-in on domestic violence have blown away the myth that such violence occurred only in lower-class families . . . The findings had shown that of about 120 people responding to the phone-in, 40 per cent of offenders came from professional, managerial or senior administrative positions, and 32 per cent came from trade and manual positions. The survey response (0.05 per cent of the Canberra population)-- so not a very big percentage of the Canberra population used the phone-in- had been ''comparatively high'', and represented double the number who had responded to a similar survey in Victoria . . . The phone-in was conducted by the Australian Law Reform Commission . . . The preliminary findings showed also that a quarter of the callers had put up with violence for 15 or more years, and over one third for more than five years; that the advent of children in marriage might be a critical feature in precipitating the violence, and in one third of the cases children had witnessed the violence; that alcohol was involved in 42 per cent of the violent incidents, and that 10 per cent of assaults involved sexual assault. Of the 33 per cent of the women who had called police to an incident, a great number reported dissatisfaction with police response . . . We find similar reports in other areas. The Institute of Family Studies has gone into this area in quite some detail. It says that the number of cases of children battered each year is as many as 13,500-that is, 37 children physically injured each day-and that is considerable assault, not minor assault. In Brisbane it has been estimated that fatal child abuse is now the third major cause of violent death in Australia for pre-school children-I believe that is a very worrying figure-with 3.77 per 100,000 at risk. It is also the fifth major cause of violent death of all children up to 15 years, so those figures are pretty horrifying. In a survey of about 300 parents presenting for marriage guidance counselling in New South Wales, it was estimated that in 27 per cent of the cases the husband had beaten his wife; in 4 per cent of the cases the woman had beaten the man; and in about 4 per cent of the cases both spouses were violent. The major causes, according to the response from the spouses, were drink or jealousy. I believe that there are other reasons, and I am quite sure it would not be denied that the frustrations of unemployment must well be considered one of those reasons. In 1974 there were 155,600 unemployed and in April 1985 there were 614,200. One does not wonder at the increase in violence. There is also the additional problem of the duration of unemployment, which went from an average of 6.5 weeks in 1974 to an average of 45.5 weeks in 1984. I was Chairman of the Senate Standing Committee on Social Welfare which inquired into homeless youth. The members of the Committee travelled to each State and Territory and we came to a very early conclusion that the majority of the youth had been abused and turned out by their parents; not only abused by the father but also abused by the mother. As we toured around and spoke to boys and girls and those in charge of them, it became very obvious that a group of young unloved Australians was growing up in the saddest situations one could possibly imagine. Their parents were either unable or unwilling to look after them. We were told by a social worker that families did not like taking court action against fathers in cases of incest because that upset and disrupted the whole financial stability of the family. We were told by one teacher that an eight-year-old boy and his seven-year-old sister went home after school to find that mum and her de facto spouse had gone-just moved away, lock, stock and barrel. The children did not know what to do. They went back to school and slept under the building that night. When the teachers realised something was wrong the children were taken into care. The Committee heard many other very sad reports. It is not just a case of only men indulging in violence. That was stressed by Senator Haines today. In cases of violence involving a husband and wife, the man is the violent one in the majority of cases. Mothers, in their frustration, also indulge in dreadful violence towards their children. I shall give some figures that indicate either a tremendously rapid increase in such incidents or greater acceptance of reporting them. Since 1977 the medical profession in New South Wales has been required to make reports of serious forms of child abuse. In 1980 there were 921 incidents, in 1981 there were 1,528, in 1982 there were 3,000 and in 1983 there were 6,442. One report that was drawn to my attention in which I was certainly interested was commissioned by the Tasmanian Government. It is the report of the Hopcroft Review into Domestic Violence in Tasmania. The Government has taken up three of the recommendations that that report put forward. The first recommendation was that amendments be made to the Justices Act. Tasmania is one of the States that have proposed law reforms relating to domestic violence. The other States are New South Wales, Queensland, South Australia and Western Australia. I am not sure whether legislation is the total answer. The second recommendation proposed the establishment of crisis intervention centres throughout the State. Members of the crisis intervention service have been recruited and are presently being trained at the Police Academy at Rokeby. When the police answer a call of a crisis nature, such as a request to come to a home to restrain a parent or a husband, a police officer plus a member of the crisis intervention team, who will have been trained specifically in that area, will go to that home to do what they can and to provide short term counselling. Members of this team are being trained only in relation to short term crisis counselling. The third recommendation that the Tasmanian Government adopted should be looked at in light of the criticism that is often so easily levelled at the police force. I believe that the police are often in a very difficult position, not having actually witnessed an incident. Police in Tasmania are presently being trained in crisis intervention in cases of domestic violence. I believe that that will go a long way in providing help in the situations that Senator Haines talked about. John Edis Hospital in Tasmania is setting up a program under the responsibility of the mental health division. It is co-ordinating and training voluntary groups of men in long term counselling. I guess women will become involved later. It is hoped to tie in the work of those counsellors with the legal system making counselling a condition of a suspended sentence or bail. Education in this area has been suggested for the schools in Tasmania. In April this year a course was provided in Victorian schools. I refer the Minister in the chamber, the Minister for Resources and Energy (Senator Gareth Evans), to one matter. He was told of and given the recommendations from the Hopcroft report. As far as I know, he has done absolutely nothing about them. I refer to the recommendations in the area of family law. Because time is rapidly running out, I ask for leave to have those recommendations incorporated in Hansard so that I can get a response from the Minister as to what action he may have taken. The recommendations have been sent to him and it would be of great assistance if the Government would look at them. Leave granted. The document read as follows- That S114 AA (6) providing that the power of arrest cease to have effect six months after the date specified in the order, include the additional phrase ''or until further order'' to cover intractable harassment likely to exceed six month's duration. That all actions for contempt be the responsibility of a Federally appointed law officer. That where appropriate the complainant alleging that the non-molestation order has been breached be able to provide evidence of this by affidavit to avoid appearing in court. That the regulations concerning the attachment of a power of arrest direct that the judge attach a power of arrest to all ''ex parte'' orders concerning personal safety attach a power of arrest once a complaint has been filed that a personal safety or exclusion order has been breached attach a power of arrest automatically once it is established that a personal safety or exclusion order has been breached that the judge in all other cases when exercising his discretion as to whether or not to attach a power of arrest: to give priority to the victim's need for protection and the utility of the arrest power in clarifying the enforcement function of the State police should any violent incidents subsequently occur. to treat it as exceptional not to attach a power of arrest in all cases other than where the violence is an isolated instance of abuse, where the injury and threats were not serious, and where there is a formal undertaking by the offender, acquiescenced by the victim that such behaviour will not be repeated and there appears to the Court highly probable that the violence or offending behaviour will not be repeated. That caution be exercised in deeming an ''ex parte'' application ''unmeritorious'' and consideration be given to the extreme difficulties faced by the victim of family violence who seeks to invoke the law's protection while still cohabiting with her violent spouse. Senator MASON(New South Wales)(4.26) —The Senate is discussing a proposal from my colleague Senator Haines that funding by the Commonwealth for programs to counter increasing violence against women and children is a matter of public importance. I support that proposition. Having listened to the appalling, quite harrowing and horrific statistics that Senator Walters mentioned-for example, that in Queensland child abuse is the third highest cause of death among children of pre-school age-I have cause to wonder about only one thing and that is the apparent reluctance of our society to recognise this problem for what it is. One of the most amazing things about domestic violence is that it continues and figures continue to be released by the media and in government reports, yet precious little is done about it. We discuss many things in this place. Often enough they relate to the financial interests of large or even small groups, or to fine points of law. Seldom do we devote time to the urgent problems of the largest minority group in the community-children-who because they are generally smaller than adults, because they have virtually no rights, because they have no electoral clout whatsoever, suffer a wide variety of bad treatment and deprivation and often repeated and protracted injury and abuse. It is historically true, for the reasons that I have stated, that children have always been victims, but one would hope and expect that in a society which is becoming better educated and which, hopefully, is becoming more enlightened, that there would be better understanding of the fact that children do inherit the earth. They take over everything from their elders, no matter how unwilling their elders are to surrender their influence and possessions. Violence to and abuse of children, with the attendant warping of mind and body, cast dark shadows of many kinds into the future. I believe that many of these problems stem from the Victorian concept that children are somehow the property of their parents or guardians. Another concept, in itself respectable enough, is that the home should be a place where privacy and the rights of householders are respected. That these principles should be extended to a stage where people starve, abuse and generally mistreat their children with impunity seems to me quite intolerable. There seems to be another regrettable notion, held even by government, that somehow the importance of children increases with their age and, presumably, their size. Hence, in the last few weeks the Australian Labor Government has cut assistance to pre-schools, presumably, with the idea that it is a justifiable economy and that small children and their education do not matter. The fact is that pre-school children are by nature probably at the best and most efficient learning phase of their lives. After all, this is the time when children learn a language which is foreign to them-although their native language-simply by observation. It has been appreciated and proved in many experiments throughout the world that children can learn many other things with great facility at that age. This is not an argument for forcing education on them-let me make that quite clear-but it is certainly an argument for allowing them access to the forms of education they would naturally wish to acquire. An intelligent community or government would recognise this fact and see that proper pre-schools are very much in the interests of the community and that child minding centres, which do not provide a significant and expert educational input, are correspondingly less than satisfactory. Child abuse is not a new phenomenon, despite major increases in reporting of such incidents in recent years. In the last century practices such as baby farming were rife, and children worked long hours in terrible conditions in factories, as chimney sweeps, and in mines. Many children died as a direct result of being over-laid in bed by drunken parents. Others suffered a variety of inflicted injuries and were exposed to all kinds of physical and mental torture. It was against this background that public awareness and indignation were aroused in the United States following the case of a young child who had been seriously abused over a long period. A volunteer missionary trying to get help for her finally turned in desperation to the Society for the Prevention of Cruelty to Animals in New York, having been told: 'The parents have a right to correct the child. You will be arrested if you interfere'. On the bringing of the case before the Society the statute books were searched in vain for some law which would justify the rescue of the child. There were none. Animals were protected but children were not. Finally it was decided, incredible though it may sound now, that the child should be treated as a little animal of the human race. Officers of the Society seized the child and the scissors with which she had been beaten about the face and body, and brought her before the Supreme Court. The ensuing public outcry led to the first Society for the Protection of Children in New York and the first Bill of Children's Rights in the United States. In most developed countries there is now an awareness by professionals of both the problem of child abuse and the identification of some of its causes. As a result there has been a variety of treatment programs for children and parents, training programs for workers and a growth of self-help groups in the community. Nevertheless child abuse continues. We have no evidence to show that despite increased knowledge and awareness of it, it is on the decline. Child abuse takes some bizarre forms indeed. Some years ago I was told by professionals in the child care area that, among other things, a practice exists which goes by the name of zonking out. Zonking out involves women, who perhaps because they have a boyfriend or do not want to look after their children properly, go to the doctor and get a prescription for valium, panquil or a similar tranquilliser which they say they need. They then use that tranquilliser to keep their small children in a state of permanent tranquillity or stupor simply because they do not want to go to the trouble of looking after them. I was assured that a number of cases of this kind were known. They are probably a good deal more common in the community than is understood. I heard of the case of one child who had been treated in this way. The single mother had a boyfriend and the child was given tranquillisers every day. This child was occasionally given water and crusts of bread. I think it was a boy. When he was taken into care he was stunted to the extent that he was virtually half the size of a normal child of the same age. I raise this point because I believe it is symptomatic of the submerged nature of this program to which Senator Walters has referred. It is terrifying, for instance, to think that doctors hand out tranquillisers to people apparently for no reason whatsoever other than that they are asked for. They are handed out without any kind of investigation or insurance in regard to what they are to be used for. It is terrifying that we have instances of this zonking out, which is a known phenomenon to those people who work in this field although it may not be well known to the community. I believe there is a certain resistance in the community even to recognise the fact that this sort of thing actually happens. We must also consider other forms of child abuse-institutional, socio-economic, political and legal-because they are real, large scale and essentially preventable. There have been significant advances in the last 10 years or so concerning children's rights and welfare, with dedicated work being carried out by top notch people in many fields, new services for children, the beginnings of legal representation and a growth in skilful advocacy. But a great deal more needs to be done. Basically those things are good and are useful, but they do not recognise the fact that society itself has much to do with the problem of child abuse. The patterns of life that we are developing in our communities are largely responsible. I once talked to a group of people from a high-rise housing commission home unit block in a suburb of Sydney, which will remain nameless for the time being. I was told that there was a pretty high rate of child abuse there. I was not surprised to hear it. The reason, on the account I was given, was that a young mother may well be rearing a child in one of these places, which are more like beehives than anything else. They contain huge numbers of people stacked on top of each other, family after family. The units have thin walls and no proper soundproofing. The child cries; the mother has people beating on the walls, shouting 'Can't you shut that kid up?'. If we persist with this kind of pattern it will be surprising if we do not have more child abuse rather than less. One can sympathise with the problems of such a person living in isolation, among neighbours who are not particularly friendly and may well be hostile. She does not even have a piece of bare ground to walk on because some of these blocks of units are built on very small allotments. The situation is so bad that we could not contrive worse if we tried. I saw something of a contrast to this 10 years ago when I visited China. I will not idealise China or its developments but I saw a block of high density accommodation in Peking which had been built deliberately in the style of townhouse development. It was no more than two storeys high and anybody could quite easily walk down to ground level where there were garden and trees. Although bathroom, kitchen and toilet facilities were shared I thought it was more important sociologically and socially to have contact among people. It provided a more human environment than giving everybody their own bathroom and kitchen in a block of home units in which there was no real outlet for the family and no answer to the problems created by bringing up children inside such blocks. Another point which we as a society could look at is that grandmothers, particularly in China, are very closely associated with the care of children. The natural relationship between the very old and the very young is recognised and used. It is traditional and something that we ought to look at more. Several other courses of action in this direction are desirable. The international exchange of information on what is a good social background for people and what is being done to ameliorate this problem of child abuse should be expanded and strengthened because it is a world-wide problem, not just an Australian problem. All governments, even those with existing services such as ours, must recognise the need for services to abused families and abusing families and afford them appropriate political priority. Any senator who has been, as I have, to a number of women's refuges cannot fail to be struck by the irony of their environment. Women's refuges are the final refuge from violence of abused families-Usually there is a locked gate, apparently to keep abusers out because they might come and repeat their offence. Inside they have the most pathetic makeshift furniture; they are always short of money and they have none of the facilities that one would expect a refuge of that kind, which is after all basic and fundamental to have. It is a surprise to me that society tolerates that situation too. I gather from what I have heard recently that that situation is not improving but is becoming worse as time goes on. It should be recognised that the majority of children who are abused become victims of that abuse when they are very young. Consequently, by the time many of these children reach school age they have been emotionally damaged and thus later become the next generation of abusing parents. This link has been demonstrated and proved. Parents who have been abused as children are likely to abuse their own children. They see this as a normal pattern of life. In a family in which a male child has seen his mother beaten by the father, he will see that behaviour as his right and responsibility in the next generation. As a result, the problem is self-perpetuating. Because of that, it has an even greater demand on our attention. This is not a single isolated set of circumstances which has been created; rather, it is a set of circumstances which is doomed to perpetuate itself generation after generation. Naturally, the worse they become, the worse they will be again in the succeeding generation. It is essential that there be provision of services for children under the age of five as much as possible. In the light of that, I return to my earlier criticism of the Federal Government's recent withdrawal of subsidies to pre-schools. It is particularly disturbing in the light of that situation, since pre-schools at least provide a period of separation, and thus a breathing space, for potentially abusing parents and their children. The young mother in the home unit block that I mentioned can at least get away from the problem for a time if there is a place to which the child can go, where that child can be in its own peer group, and the mother is given some chance to be away from the problem. Community support services for parents must be developed further. The Royal Alexandra Hospital for Children in Sydney has had a marked degree of success in involving non-professional volunteers in early intervention in abuse cases. Often a potentially abusing parent is reluctant to seek professional advice about problems because of fear of repercussions from involving the 'authorities', as they are called, and partly because the parents find it easier to share their anxieties with other parents who might be in a similar situation. Such self-help advisory services are of the utmost value. Finally, I urge the Government to give them all the support it can. Senator GILES(Western Australia)(4.42) —The topic of the matter of public importance this afternoon is: The need for the Commonwealth Government to fund programs to counteract the increasing social problem of violence against women and children. This matter has hardly raised a clamour of dissent. In fact, it would be difficult to argue against such a statement. However, I do not believe that what we have heard so far really substantiates the notion that simply funding programs is the way to deal with this extremely pervasive and still largely hidden problem. Initially, I will address a comment made by Senator Walters about recommendations from a conference in Tasmania on domestic violence and, specifically, recommendations about changes to the Family Law Act. I simply state that I have been assured that a response will be given to the points in that document which refer specifically to changes that need to be made to the Family Law Act. It would be interesting to know just what response the Tasmanian Government has made to the very many recommendations directed from that conference to the Tasmanian Government. The recommendations about the Family Law Act can be reduced to four points: The need for access centres; a national agency for the collection of maintenance; power of arrest to be extended past six months after an original order in cases of molestation or threatened molestation; and all actions for contempt to be dealt with by the Federal Court of Australia. As I said, responses to those points have been promised. The matter before us is of topical importance. However, I would much rather be addressing a topic of even more pressing importance, which relates not to private violence, but to the dreadful public violence which has just been perpetrated against the people of Queensland, particularly against women whose medical records have been confiscated. But perhaps we can deal with that in some other way. I feel, though, that when we are addressing a matter which is of very personal importance, it would be remiss of me not to refer to that quite startling occurrence about which we have just heard in the last couple of days. Awareness in the Australian population has been rapidly growing over the last 10 years in relation to domestic violence of all types, much as a result of the activities of the women's movement. Domestic violence is as old as humanity itself, but it has remained largely hidden from history-a private matter about which society at large has been loth to concern itself. In the past, refuges were commmonly provided by religious institutions, but only as a last resort, and they would often be to the women concerned a great humiliation and a symbol of defeat and of worthlessness. The emergence of the second wave of feminism in the late 1960s was predicated on the identification and, more importantly, articulation of all sources of women's oppression, both public and private. For the first time, domestic violence was discussed publicly. Society was forced to recognise its existence, not just in homes where it might be written off as an inevitable response to poverty and deprivation, but right across every spectrum. This is a phenomenon in which there is no discrimination on the grounds of race, religion or social origin. However, most of the victims are, by definition, relatively powerless, within households and elsewhere, women and children. The notion that personal and private business was of no concern to the community generally was the first enormous hurdle that had to be overcome. More importantly, we had to overcome attitudes of police and politicians and public perceptions. The police, with very good justification, were often very frightened to interfere in what were known in those days as 'domestics' and, in fact, I understand that involvement in household fights of one sort or another has been the greatest cause of injury and even death in the police force in the past. Police simply lacked the expertise to deal with these very difficult situations. They were often extremely frustrated when, having intervened, they then found that the charge was dropped. The attitude of politicians generally was that it was an extremely dangerous matter to involve laws of one sort or another in domestic situations. There were even accusations that those who did try were encouraging the break-up of families; that simply to provide refuge for women under threat, or their families as well, was in fact somehow destroying the family. This attitude existed despite evidence of the most dreadful physical and sexual abuse. The public perception of battered women was that they were somehow deficient, at least, or at worst, actually deserving of such treatment. At the United Nations level it was notable, but not surprising, that at the International Women's Year Conference in 1975 in Mexico, the document produced, 'World Plan of Action', included no mention at all of violence of any type against women. However, the mid-decade document in 1980-the Program of Action produced in Copenhagen-carried a strong statement on the subject, as will the Forward Looking Strategy, which is the document which will emerge looking towards the year 2000 and which will be worked on at the United Nations Conference in Nairobi in July of this year, celebrating the end of the United Nations Decade for Women. Most nations now recognise the need for the judiciary and enforcement personnel to be trained formally and deliberately, first to deal sensibly and sensitively with the victims of domestic violence and, secondly, to deal with the offenders no less severely than with the perpetrators of any other category of assault. This shows that, as in many spheres of social progress in Australia and elsewhere, the early work of the women's movement has been translated into political action, predominantly, in this country, through the policies of the Australian Labor Party. As one who has been closely involved with these developments over the past 15 years, I can see in most States enormous improvements in many aspects of official and legal procedures: Facilities such as refuges and sexual assault referral centres which did not exist 10 years ago; more political awareness among women generally of their rights and of the support structures available; and a much better understanding in the community generally of the extent and the destructiveness of domestic violence. There is little reliable data, as every speaker has already commented. We do not know how many people are injured at home. Of course, fatalities are recorded but injuries are rarely recorded as domestically produced and are rarely so reported. To quote an injured woman: 'Medicos side-step the issue. They don't know how to recognise domestic violence. They certainly don't know how to handle it'. Any sort of documentation about incest, an even more recently uncovered and, shall we say, discovered domestic phenomenon, is even less well known. To quote an American publication of the Bureau of Justice Statistics: Various studies have produced widely varying estimates of the magnitude of the problem of family violence. A major reason for the divergence of such estimates, aside from any methodological issues, is the perspective from which the problem is examined. Family violence is a criminal justice issue as well as a social, moral, and psychological issue. An estimate of the number of persons who have suffered psychological as well as physical abuse will be larger than an estimate of persons who have been criminally abused as long as some forms of abuse are thought to be outside the scope of the criminal justice system. Closer to home, we have a report of the New South Wales Task Force on Domestic Violence which reported to the New South Wales Government in July 1981. As a result of a study in the western suburbs this report comments: In all areas domestic complaints calls exceeded those about other assault, in some areas three times as many. It makes reference to more comprehensive figures from the United States as follows: In the United States, according to the few studies so far completed, 50 to 60 percent of the nations 47 million married couples have had at least one violence incident and 10 to 25 percent suffer violence as a common occurrence. I do not know that the figures would be very different in Australia. There have been considerable initiatives by the Federal Labor Government to deal with this and allied problems. The funding of refuges through health commission money in 1974 was a completely new initiative. It could not be reversed by the coalition Government, so apparent was the need. It engendered varying degrees of acceptance by and of co-operation from the States. The services barely expanded but managed to survive during those years. Recently, as a result of another Labor Government, we have seen greatly increased funding under the women's emergency services program of 1983-84. More recently, in 1985, the supported accommodation assistance program has provided a great deal more flexibility in funding. It has allowed refuges to bring their workers' wages up to award rates, it has allowed a considerably expanded level of services and it has introduced migrant services into the women's emergency services program. Children's services are absolutely essential to any reasonable approach to the sorts of problems that develop within families and which can erupt in violence. In 1972 the McMahon Government introduced an Act which for the first time, provided children's services with Federal funding. Following that, there was greatly increased emphasis by the Whitlam Government. In those days funding went largely to the establishment of pre-schooling in many States. We now believe this responsibility should be taken over by the States. The story with children's services is very similar to that with refuges: The services survived during the lean years of the coalition Government; in 1983 the Labor Government came to power with a promise of greatly increased funding for children's services; by 1989 we will be able to double the number of children's services places that we inherited from the Fraser Government in 1983. Other extremely important aspects of our initiatives towards increasing the security of families, towards the better functioning of families and towards dealing with the inevitable problems of families were the introduction of the Family Law Act in 1975 and some extremely important amendments to it that were made in 1984. Our Royal Commission on Human Relationships in 1977 allowed much better articulation of the needs of families. Let us not forget the vitally important role of housing in providing the means by which people are able to get away from intolerable domestic situations. As any refuge worker will tell us, there is a crucial need for affordable housing, public if necessary, to which women and their children can be directed in the event that the family home becomes absolutely intolerable. Constitutionally, the States must accept much of the responsibility for the services that go to making family life valuable and tenable. The role for the Commonwealth Government seems in many respects to be that of providing an overview, providing direction and providing evaluation which currently does not exist in the plethora of services which are available, some of them very good and some of them not so wonderful. What we are doing, which may be of news to some people and which is particularly relevant to the subject of this matter of public importance, is organising a national conference on domestic violence which is planned for November this year. The conference will be held in Canberra and will be followed in February next year by a second conference on child abuse. We intend to bring expert speakers from overseas. It will be an opportunity for a thorough overview of all types of domestic violence in Australia in 1985 and, we hope, an opportunity for sensible forward planning to be made so that funds that are made available, as suggested by Senator Haines in her MPI, are valuably used and so that all other services are expanded in the interests of developing the best possible environment for families to flourish. The DEPUTY PRESIDENT —Order! The discussion on the matter of public importance has concluded. Senator PETER BAUME(New South Wales)(4.57) —I move: That the Senate take note of the paper. This paper on women, sport and the media has been in our possession for only a short time and it has not been possible to do any more than look at the recommendations. They seem to me to be sensible and will reward further reading. Although I have only had a short time to read the report, I wish to give my congratulations to the members of the Group, including my political opponent Senator Crowley, who was the convenor of the Group, and to the members of the Group, some of whom we noticed were in the Senate earlier today, for the work that they have done and the information that they have given us. The critical recommendation that emerges concerning women and sport is recommendation 8, which reads: That government assistance to sports associations should be equitable. It goes on to expand on that recommendation. As I have gone around Australia as Opposition spokesman for the status of women and have talked to groups of women, and as those women have set out for me what they see as problems facing them in society, among the issues raised has been the apparent discrepancy in the access of women and women's sports associations to a fair share of public funding. I just went back and had a look at the policy of the Liberal and National parties and the summary of our policies affecting women. It states that we have: Commitment to equality of opportunity for all Australian individuals and their families and opposition to discrimination of any kind . . . It states further: We are committed to policies and approaches which will give women genuine freedom of choice, whatever their age and circumstances, to pursue the life-style that suits them and their families best and allows them to realise their full potential as citizens, wives, mothers. What Senator Crowley and her Group has been doing is entirely consistent with that thrust. The point that has been put to me by representatives of women's groups-I am reminded particularly of a meeting I had in Western Australia; I am sure the particular woman has in fact appeared before Senator Crowley's Group-is that there does seem to be gross inequity in the way in which public money is made available on a gender basis for the support of sport. It does not seem equitable or fair. The question arises: Is funding for sport in fact funding to allow participation by the greatest number of Australians in pursuit of a healthy lifestyle, or is it in fact simply to ensure that we win more medals at some Olympic Games? Is it merely for the support of elitist sportsmen and sportswomen? If it is the former-I hope that that is what it is and that a considerable amount of money goes to the support of many Australians-what this Group has sought to lay down in its report is entirely fair. Before Senator Crowley came in I was congratulating the Group on its work. The question of a fair go for Australian women is at issue. If what the Group is seeking is generally what is set out in recommendation 8-that is, that government assistance to sports associations should be equitable-it will find complete acceptance from the Opposition of that recommendation and of the sentiment that is behind it insofar as it seeks equality of opportunity for all Australians, including the 51 per cent of Australians who happen to be of a particular gender. If one looks at the figures for the allocation of money to sport, it does seem that there has been an imbalance. It is hard sometimes to make an exact judgment. Some sports associations that receive money may have men and women members and it is hard to determine how the money is distributed. But the clear impression which one gets from looking at the way in which Commonwealth money goes out is that it has gone disproportionately to sportsmen. If this report can assist in achieving equality of opportunity for all Australians, and what our policy sets out as our belief, that there should be absolute equality of opportunity for both sexes, we will be well pleased. I will need to read the detail of this quite voluminous report now to see whether its reasoning bears out what I have just said. But on the surface and on a first examination it seems an admirable report and one which will be extremely helpful to the Opposition. Senator CROWLEY(South Australia)(5.04) —Rarely do I rise to speak on a report about which I have such comprehensive understanding. I am pleased to say that this report is one that-- Senator Peter Baume —You weren't here. We would have let you speak first. Senator CROWLEY —I appreciate that. I thank the honourable senator for his comments so that I am able to speak to this report myself. I take this opportunity to put on record my thanks to my colleagues-one man and a number of women I worked with on the Group. In particular, I thank the Government, which acted on one of the many recommendations that were part of its policies for women. This was a program of the Labor Government when it came to office in 1983. On an initiative from the Office of the Status of Women in the Department of the Prime Minister and Cabinet, Prime Minister Hawke asked that the Minister for Sport, Recreation and Tourism (Mr John Brown) and the Minister for Education and Minister Assisting the Prime Minister on the Status of Women (Senator Ryan) establish a Working Group on Women in Sport. It fell to my fortunate lot to chair that Group. The Group was set up in June last year and had its first meeting in September. We were charged to bring our report in within six months. We are just over time but well within budget. We received 118 written submissions, we held public meetings in every State and Territory and we had hearings with the media and sporting organisations. We heard evidence from journalists and staff of the Australian Broadcasting Tribunal in Melbourne, Sydney, Darwin and Perth. All of the evidence and the submissions from the public hearings confirmed the very reason for our existence. The problem for women in sport was that they received, and have ever received, very little recognition in the face of quite remarkable achievements. They still have very insufficient media coverage and they draw very uneven and insufficient funding-a point to which Senator Peter Baume has referred-and they are still victims of prejudice and ignorance in the media. The report further illustrates and records evidence that some of the difficulties facing women in sport pertain to the insufficiency of training for women in administration and coaching, access to facilities, support equipment and so on. It is not the business of this Group to devote most of its time to carping or to criticising. It feels that it was very important to record the prejudice and the insufficiencies that I have just listed, but the point of our recommendations is to address the ways in which all those problems can be overcome. The first recommendation addresses the establishment of a women's sports promotion unit to be established within or under the auspices of the Australian Sports Commission and answerable to the Minister for Sport, Recreation and Tourism. We recommended that the women's sports promotion unit comprise five people with a majority at least of women, although this might seem to contravene the sex discrimination legislation. Under that legislation exemptions to promote equality of opportunity are allowed. We would argue that, under those terms, it was a useful recommendation. The women's sports promotion unit should draw from women with experience in sport and sporting administration, a knowledge of sport, a knowledge of media and also from the Office of the Status of Women. It should address the many recommendations that are listed under that first significant reference. In our examination of the media we encountered any number of examples of what we could only call perpetual prejudice against women in sport. Remarks such as 'women's sport is second rate'; Ian Chappell's claim as reported in the Clancy part of the National Times recently, that we had to get these equal rights women back in their places, illustrate in a classical way that there is a prejudice amongst some sports journalists and many people in the community against women's sport. They have insisted that it is not excellent. If honourable senators read the report they will find any number of examples that it is excellent. In my final minute, I would like to mention the wonderful piece of serendipity that we have established a women's sports promotion unit with the letters WSPU. I refer to the women's social and political union headed by the Pankhursts to establish voting rights for women in England. Those votes have been won, but the struggle for rights for women and for their voice to be heard in public office continues. We feel it is a very fortuitous piece of serendipity that the women's sports promotion unit will continue the struggle for the rights for women, for the recognition of their ability, their achievements, and public acknowledgment of same and, as Senator Baume said, their equal access to opportunities in this country. Question resolved in the affirmative. Senator PARER(Queensland)(5.08) —I move: That the Senate take note of the paper. We are debating the report by the Human Rights Commission on the Queensland electricity supply and related industrial legislation. Regrettably, the Human Rights Commission is a totally denigrated body. It is being used blatantly as a propaganda arm of the Government paid for, yet again, by the overburdened taxpayer. It has served one useful purpose in that as the servant of government it has exposed this Government. Queensland is a sovereign State. Its Government has a right and a responsibility to make laws on behalf of all its people. As with any government, not everyone agrees with laws introduced, amended or repealed by it. However, under our democratic process a number of procedures can be followed by those who dissent. Senator Reynolds —What, in Queensland? Queensland doesn't know the meaning of the word. Senator PARER —Senator Reynolds dissents. These are the procedures she should follow. If considered illegal, the laws can be tested in the courts; if legal but unpopular, opposition can be expressed in the ballot box at the appropriate time. Any bully-boy Mafia-type stand-over tactics, as we have seen in the recent blockade of Queensland and the black listing of innocent companies, have the potential to undermine and destroy our democratic process. Neither the Australian Council of Trade Unions nor the trades and labour councils were elected by the people to govern Queensland or Australia, yet they attempt to act as de facto governments. At the request of Senator Reynolds, the Human Rights Commission-what a misnomer-rushes up to Queensland and comes up with a quickie report which was just as predictable and is just as shonky as its report on the Community Services (Aborigines) Act 1984. The Human Rights Commission pays scant attention to the rights of the people of Queensland to be able to obtain essential services, or the resultant hardship to the community when those services are removed. At a recent forum Professor Lachlan Chipman stated: It is important to realise that bodies like the Human Rights Commission cannot be dismissed as a collection of well meaning, concerned, responsible citizens. Perhaps they are, that is not the point. The record of the Commission has been quite appalling when it comes to the protection of fundamental individual rights and the Commission itself has been party to the most serious violation of such rights. Perhaps the Commission could be more usefully employed investigating the infringement of individual rights of the majority by those unions involved in industrial blackmail, bullying and blockades. At no stage does the Commission recognise the right of a sovereign State to make its own laws. Instead, it urges the Federal Government to denigrate State rights by passing laws that override the State. This hits at the very heart of our Constitution and I am amazed, as will all the people of Queensland be amazed, that this report to diminish our States rights was initiated by a Queensland Labor senator. The result is that we have the Labor Government introducing a Bill which, it is generally considered, may be found to be unconstitutional. It is being introduced simply to appease the Government's masters, that elite group in Melbourne who are the political power brokers of the Labor Party-the ACTU. We have a non-elected group attempting to destroy our democracy. In any struggle between the elected Government and a non-elected power group, the Government cannot afford to lose for the sake of people of this country and our State. Senator REYNOLDS(Queensland)(5.13) —I am extremely disappointed that Senator Parer should speak along the lines he did. His is the kind of speech that I would have expected from a member of the National Party, but it is not the kind of speech that I would have expected from a member of the Liberal Party. I wonder whether Senator Parer has even bothered to read the recommendations of the Human Rights Commission report on the Queensland Electricity (Continuity of Supply) Act 1985. I am certainly very proud to be associated with the Human Rights Commission and I certainly endorse its recommendations which I will read to the Senate: The Human Rights Commission, having found that the Queensland Electricity (Continuity of Supply) Act 1985 is inconsistent with Article 8 of the International Covenant on Civil and Political Rights, which prohibits forced or compulsory labour . . . recommends- (a) that the inconsistencies be brought to the attention of the Queensland Government with the object of persuading that Government to repeal the Act or at least amend it to limit its operation to emergency situations and in a manner consistent with the observation of human rights. Of course, the Queensland minority Government-and I stress that it is a minority government, although everyone on the other side of this chamber gets up and talks about democracy-- Senator Missen —Not everybody. Senator REYNOLDS —I am glad that Senator Missen agrees with me about what is going on in Queensland, both industrially and in human rights generally. Furthermore, the Human Rights Commission said that if the Queensland Government did not repeal the Act or bring it into line with Australia's obligations, the Commonwealth Government should consider introducing legislation which would make the provisions of Article 8 applicable as part of the law of Australia. Apparently unknown to the Queensland minority Government, Queenslanders want to be considered part of Australia-- Senator Boswell —Not if you are running it. Senator REYNOLDS —Senator Boswell is not aware of the basic numbers game in regard to support for the Queensland senators in this place. The Australian Labor Party attracts more support than the National Party at Federal level and it certainly attracts far more support at State level. Senator Townley —Wait until the next election. Senator REYNOLDS —We are waiting for the next election because we know just how much Queenslanders are absolutely fed up with being dictated to by the Queensland minority Premier. He has only 39 per cent of the vote and yet he can dictate to Queenslanders. Before I finish I wish to say how disappointed I am that the Queensland Governor, Sir James Ramsay, did not see fit even to read the report which Queensland Labor senators sent to him. I hope that his successor might look on this report a little more favourably. In a letter to me, his aide said merely that he acknowledged receipt of my letter, signed by myself and other Labor senators, containing a copy of the Human Rights Commission Report No. 12. The letter says: The Report has been put before His Excellency and he feels that a meeting with you is not required. I know Sir James Ramsay and I have always admired him. I am most disappointed to find that he is not concerned about the basic infringement of human rights in Queensland, in terms of both this industrial legislation and events this week. Senator MISSEN(Victoria)(5.17) —I rise to express my appreciation of this report from the Human Rights Commission. I do this as a member of the Queensland Council for Civil Liberties, among other things. I am surprised by the speech made by Senator Parer. Obviously he is one of the people who, unfortunately, have not been able to get a copy of this report, which is in very short supply at the moment. I regret that the report is not in sufficient supply to be read by all honourable senators. I believe that the report is a good one. It follows a report that the Commission made on the Queensland Electricity (Continuity of Supply) Act 1985 and is a reference to the number of Acts-five in all-which have been passed by the Queensland Government. One may not agree with some of the courses that have been taken by unions and by governments, both Federal and State, in this matter, but at the same time it is important to look at the particular points of human rights associated with the legislation that has been passed. Senator Peter Baume —It is a bit like our Scrutiny of Bills Committee, isn't it? Senator MISSEN —Yes, but unfortunately there is no Scrutiny of Bills Committee in Queensland. Senator Reynolds —Or a Public Accounts Committee. Senator MISSEN —Or a Public Accounts Committee or a second chamber of the Parliament. This is very regrettable and it perhaps accounts for the quick and rather foolish legislation which is sometimes adopted there. I commend the Human Rights Commission for having passed judgment on these matters. When we created the Human Rights Commission and the legislation was before this Parliament, I endeavoured by amendment to ensure that questions of State laws, which might offend against the implementation of a Commonwealth-honoured covenant to which we were committed were dealt with. Unfortunately I did not succeed, but at that time I referred to Mr James Crawford, lecturer in law at Adelaide University, who pointed out that under the powers which the States had and which they still have it can be said: As to matters presently governed by State laws, the only relevant head of jurisdiction is section 9 (1) (c) which refers to 'laws which should be made by the Parliament . . . on matters relating to human rights'. Now it is quite clear that this is not restricted to matters on which the Commonwealth has already legislated, which are covered by section 9 (1) (a). Therefore it must relate to proposed reforms on matters within the Commonwealth power but presently governed by State law. It follows that the Commission can investigate, with a view to proposing reforms of any subject matter of State law provided that the Commonwealth can legislate for it. So the question becomes: What is the extent of Commonwealth legislative power over matters covered by the Convention. I commended that view and I am glad to see that the Commission is adopting it and is rigorously coming forward and pointing out defects in the Queensland law. Senator Reynolds spoke of the conclusions which have come from the Commission. I think we should refer to the important findings in this document. In the briefest of terms one can say that there are records there of breaches in the five Acts that the Queensland Government has carried-breaches of human rights, of freedom of expression, which is covered in the international covenant, of matters of presumption of innocence, which is something that should be ensured to the Australian people, and also of freedom of association, which has been restricted. The various sections of these Acts are referred to in the report. It is important that in the dog fight that is now going on in Federal and State affairs, we should not forget that this legislation represents a blow to Australia's character as a human rights nation, that we have expressions in our Acts which reverse the onus of proof and which have the effect of inhibiting union officials from making statements relating to industrial disputes and that certain expressions in the media have been presumed to be conclusively true. That is a disgraceful performance by any government which should be highlighted as has been done in this report. The presumption of innocence is completely struck down by section 14 of the Industrial Conciliation and Arbitration Amendment Act. Section 5 of that Act erodes the financial stability of unions. The DEPUTY PRESIDENT —Order! The honourable senator's time has expired. Senator CHANEY(Western Australia-Leader of the Opposition)(5.21) —This debate on the report of the Human Rights Commission on the Queensland electricity supply and related industrial legislation has been very interesting. Unfortunately it has been a truncated debate, as debates on papers always are. One is forced to deal with complicated matters in a very brief compass. I must say, however, that the report which has been brought down by the Human Rights Commission has the very obvious disadvantage that it represents the examination of only a tiny segment of the issues which are raised by the Queensland disputes. Looking at the functions of the Commission which are set out in the report, we find that it has the power to examine enactments. It also has the power to inquire into any Act or practice that may be inconsistent with or contrary to any human right. I suspect that many electors in Queensland would rather regret that Senator Margaret Reynolds was so selective in the reference she sent to the Commission. In particular, they might have wondered why she did not ask the Human Rights Commission to examine the extent to which the interference by trade unions with the rights of an authority to employ sub-contractors and with the supply of electricity to the people of Queensland were actions which trespassed upon the human rights of the people of Queensland. I think there is a widespread dissatisfaction in the Australian community with the way that trade unions so often trample upon the rights of their fellow Australians. We know of the closed shop. We know of the disruption of the supply of essential services. We know of the blackmail of small businesses by transport unions which will not enable them to ply their business. We know that one of the greatest fetters on human freedom in this country is the activities of some trade unions which choose to act often in defiance of the law as indeed the unions were acting with respect to the blockade to Queensland. It is a very sorry fact that the private employers who were the subject of this industrial blackmail in the blockade of Queensland would not have been game to exercise their legal rights under the Trade Practices Act for fear of further trade union action against them. If the Human Rights Commission really wishes to be taken seriously in this country it ought to look to a more balanced approach and examine the infringement of human rights across the board and not just narrow matters which are referred to it by Senator Margaret Reynolds. The great majority of people in Australia, especially those in Queensland, would regard this report as singling out the aspect of the trampling on human rights which least concerns them. They would be much more concerned by the absolutely scandalous behaviour of trade unions in this dispute and would be very interested to know why that matter was not put before the Human Rights Commission. I believe that if the Human Rights Commission wants to be taken seriously as a body it will have to do much better than it has done in this report. It will certainly have to look more widely at ways in which freedom is being trampled on in this community. I do not believe that most people would regard this report as focusing on the matters which are most reducing human rights in this, our country. Senator BOSWELL(Queensland)(5.24) — The report of the Human Rights Commission on the Queensland electricity supply and related industrial legislation clearly is a pathetic beat-up, an attack on the Queensland Government by some Federal Government quasi-body. The Human Rights Commission which, incidentally, costs the taxpayers $5m, is a great example and living proof of how bodies such as these do not protect human rights in a democracy which must reflect a balance of the various rights of the individual. The report bases much of its comment on the International Covenant on Civil and Political Rights. This Covenant is not even part of our Australian law. The Australian people have never adopted this Covenant as an Australian law. Australia is a signatory to the Covenant. However, I hope that the Federal Government, and Senator Reynolds in particular, understand that before a treaty can have any effect it must be enacted into a law through this Parliament. The Covenant is written in very general terms designed to cover a wide range of countries, many of which do not enjoy the same freedoms as those enjoyed by Australia. Yet the Human Rights Commission has decided that it has overriding authority and is even overriding our law. Like all treaties, it is written in vague and rather imprecise terms. It is meant to express principles rather than precise meanings. For example, the term 'public order' used in the Covenant is largely unknown in the common law world. What an insult to the people of Australia to have it said that we are bound by a covenant which we have not even voted upon and which contravenes many accepted common law terms. I will point out how ludicrous and out of touch this report is. The report found that a section of the Covenant headed 'Slavery and the Slave Trade' had been contravened. How ridiculous! All the Queensland Electricity (Continuity of Supply) Act 1985 does is to allow the Electricity Commissioner to direct any person who, in his opinion, is capable of restoring and maintaining electricity supplies. How any reasonable, thinking Australian could consider that as an onset of slavery is honestly beyond my comprehension and it should be the comprehension even of Senator Reynolds. All the Queensland Government is trying to do is to guarantee Queenslanders an essential service. The motives of this report are all too clear. The Australian Council of Trade Unions and the Australian Labor Party did not like the widespread Queensland public support the Queensland Government was getting so it called this inquiry in an attempt to legitimise its criticism. The Human Rights Commission flew to Queensland and flew out on the same day. Apparently it thought that was enough time. It did not even interview the Queensland Government. Where was the Human Rights Commission-- The DEPUTY PRESIDENT —Order! The time allotted under Sessional Orders for the consideration of Government papers has expired. Senator MISSEN(Victoria) —by leave-Mr Deputy President, I claim to have been misrepresented by the statement that was made that the International Covenant on Civil and Political Rights was not adopted by this Parliament. I was present in the Parliament and moved the amendment that read as follows: Approval is given to ratification by Australia of the Covenant. That motion was carried by this Parliament when we carried the motion to establish the Human Rights Commission. I ask that that be noted on record. The DEPUTY PRESIDENT —I do not see where the honourable senator himself was misrepresented. Nevertheless, perhaps as a statement of fact it is useful to have Senator Missen's explanation recorded. Senator TATE(Tasmania) —I present the seventh report of 1985 of the Standing Committee for the Scrutiny of Bills concerning the Australian Land Transport (Financial Assistance) Bill 1985, the Australian Sports Commission Bill 1985, the Dairy Industry Stabilization Levy Amendment Bill 1985, the Dairy Legislation Amendment Bill 1985, the Director of Public Prosecutions Amendment Bill 1985, the Petroleum (Submerged Lands) Amendment Bill 1985, the Sales Tax Laws Amendment Bill 1985, the Snowy Mountains Engineering Corporation Amendment Bill 1985, the States Grants (Tertiary Education Assistance) Amendment Bill 1985, the Superannuation Legislation Amendment Bill 1985, the Taxation Laws Amendment Bill 1985 and the Telecommunications (Interception) Amendment Bill (No. 2) 1985. I also lay on the table the Scrutiny of Bills Alert Digest No. 6 dated 22 May 1985. Ordered that the report be printed. Senator FOREMAN(South Australia) —In accordance with the provisions of the Public Works Committee Act, I present the report relating to the construction of facilities for the Australian frigate project, Williamstown Dockyard, Melbourne, Phase B. Ordered that the report be printed. Senator GRIMES(Tasmania-Manager of Government Business) —by leave-I move: (1) That the President of the Senate and the Speaker of the House of Representatives be authorised to permit, at their discretion, Professor Gordon Reid to examine and copy the records of the Joint Library Committee subsequent to 22 May 1975, in the case of non-confidential material, and subsequent to 22 May 1955 in the case of confidential material. (2) That the foregoing Resolution has effect notwithstanding anything contained in the Standing Orders. (3) That a Message be sent to the House of Representatives acquainting it of the terms of this Resolution and seeking its concurrence. Senator Harradine —Is it subsequent to those dates or prior to those dates? Senator GRIMES —It is subsequent to those dates. For confidential information it is subsequent to 22 May 1955 and for non-confidential information it is subsequent to 22 May 1975. Information prior to May 1955 and non-confidential information prior to May 1975 is already available. This motion is to give Professor Reid permission to have confidential information subsequent to 1955. Question resolved in the affirmative. Debate resumed. Senator PETER RAE(Tasmania)(5.33) —When this matter was adjourned earlier in the day I was just completing my contribution to the second reading debate and indicating that the Opposition either warmly supports or does not oppose the package of various taxation amendment provisions which are contained in the Taxation Laws Amendment Bill. I had reached the stage of making reference to rebates for dependants and had said that the measure will be backdated to 1 May 1984. That is retrospective. Notwithstanding our general objection to retrospective legislation, this retrospectivity is to correct an error rather than to impose a liability and as such, it is something which is supported by the Opposition. Senator WALSH(Western Australia-Minister for Finance)(5.34) —I just want it to be noted that I have no response, Mr Deputy President. Question resolved in the affirmative. Bill read a second time, and passed through its remaining stages without amendment or debate. Consideration of House of Representatives amendment. House of Representatives amendment- Clause 11, page 10, line 16, omit 1'3', substitute 1'4'. Motion (by Senator Walsh) put: That the amendment made by the House of Representatives be agreed to. The Committee divided. (The Temporary Chairman-Senator M. Townley) Ayes . . . . . . . . . . . 33 Noes . . . . . . . . . . . 37 —— Majority . . . . . . . . . 4 —— Aulich, T. Hearn, J. M.Black, J. R. Jones, G. N.Bolkus, N. McClelland, DouglasButton, J. N. McIntosh, G. D. (Teller)Childs, B. K. McKiernan, J. P.Coates, J. Maguire, G. R.Colston, M. A. Primmer, C. G.Cook, P. F. S. Ray, RobertCooney, B. Reynolds, M.Crowley, R. A. Richardson, G. F.Devlin, R. Robertson, E. A.Elstob, R. C. Ryan, S. M.Evans, Gareth Sibraa, K. W.Foreman, D. J. Tate, M. C.Georges, G. Walsh, P. A.Giles, P. J. Zakharov, A. O.Grimes, D. J. Baume, Peter MacGibbon, D. J.Bjelke-Petersen, F. I. Macklin, M. J.Boswell, R. L. D. Mason, C. V. J.Brownhill, D. Messner, A. J.Carrick, Sir John Missen, A. J.Chaney, F. M. Parer, W. R.Chipp, D. L. Puplick, C. J. G.Collard, S. J. Rae, PeterCrichton-Browne, N. A. Reid, M. E.Durack, P. D. Scott, D. B.Evans, Jack Sheil, G.Guilfoyle, Dame Margaret Short, J. R.Haines, J. Teague, B. C.Hamer, D. J. Townley, M.Hill, R. Vanstone, A. E.Jessop, D. S. Vigor, D.Kilgariff, B. F. (Teller) Watson, J. O. W.Lajovic, M. E. Withers, R. G.Lewis, A. W. R. Coleman, R. N. Knowles, S. C.Gietzelt, A. T. Walters, M. S. Question so resolved in the negative. Resolution reported. Adoption of Report Senator WALSH(Western Australia-Minister for Finance)(5.43) —I move: That the report be adopted. In so doing, I give notice to the Senate that the Government will not accept the ill informed obstruction of wimps on the other side. The House of Representatives will not accept the Bill as amended by the Senate and if this obstructionism continues there will be no Australian Wheat Board as from 1 October this year. I serve notice on the wimps and wankers on the other side that the Government will not accept their ill informed meddling and grandstanding. They will have to accept the responsibility, if they persist with this attitude, for there being no Australian Wheat Board as from 1 October. Question resolved in the affirmative. Consideration of House of Representatives message. House of Representatives message: The House of Representatives transmits to the Senate the Bill intituled ''A Bill for an Act to amend the Australian Dried Fruits Corporation Act 1978', and for related purposes'', and acquaints the Senate that the House of Representatives has disagreed to the amendment made by the Senate, for the Reasons shown in the annexed Schedule. SCHEDULE OF THE AMENDMENT MADE BY THE SENATE TO WHICH THE HOUSE OF REPRESENTATIVES HAS DISAGREED Pages 1 and 2, clause 3, line 11 (page 1) to line 37 (page 2), leave out the clause. Reasons of the House of Representatives for disagreeing to the amendment of the Senate The Senate amendment is not acceptable because- This amendment does not take account of the fact that increasing competitiveness, and complexity, of international marketing in dried vine fruit due to intervention by governments and technological advances dictate the need for wide in-house expertise for the continued effective performance of the commercial functions of the Australian Dried Fruits Corporation (ADFC). The Government proposal that there be 2 additional members from the business community, with specialist skills in areas such as finance and marketing outside the industry, would bring fresh insights and considerably broaden the experience and expertise within the Corporation membership and strengthen its decision making base. The Corporation's functions are commercial and therefore its membership should be capable of meeting the full spectrum of commercial demands placed upon it. The Australian Dried Fruits Association (ADFA) comprises both growers and packers. The Government's proposals would ensure that the industry, through the ADFA, would continue to have a direct influence on the appointment of 6 of the 10 members. The ADFA provides nominations for the 4 grower members and is consulted on the existing 2 specialist members who have traditionally been from the packing sector. The ADFC would be consulted in regard to appointment of the 2 specialist members from outside the industry. The amendment is not acceptable to the Government. It is the wish of the Government that Clause 3 of the original Bill be restored. The House of Representatives desires the reconsideration by the Senate of the Bill in respect of the said amendment. Senator WALSH(Western Australia-Minister for Finance)(5.46) —I move: That the Committee does not insist on the amendment of the Senate to which the House of Representatives has disagreed. What has happened is similar to what happened on the Wheat Marketing Amendment Bill that has just been dealt with. There has been ill informed meddling by people who think they can attract a few more votes by doing a bit of grandstanding, while simultaneously sabotaging the interest of the very people from whom they hope to get votes. The Government is equally adamant on this question. Senator Chipp —The Labor Party's lowest rural vote was when you were the shadow Minister. Senator WALSH —Senator Chipp should go and wash the blood off his hands. He should preside over a few more national service ballots and send a few more conscripts to Vietnam. The TEMPORARY CHAIRMAN(Senator Townley) —Order! Senator Walsh, I do not think that kind of outburst is required. Senator WALSH —Whatever I may or may not have been guilty of, I did not send any conscripts to die in Vietnam. I did not preside formally over the ballots that sent them there. The TEMPORARY CHAIRMAN —Order! Senator WALSH —The Government will not accept the ill informed amendment which meddlers in the Senate have moved, as I said, for no reason other than a bit of populist grandstanding. The Australian Dried Fruits Corporation is different from the Australian Wheat Board in that it will continue to exist whether this Bill is agreed between the two Houses or not, but the additional expertise which the Minister for Primary Industry (Mr Kerin) sought to make available to the Board by this Bill will not be available to the Board and the dried fruit producers will be commensurately disadvantaged. Senator COLLARD(Queensland)(5.47) — The Opposition will vote against the motion moved by Senator Walsh. Our vote is not ill informed. Senator Messner —It is most informed. Senator COLLARD —It is a most informed vote, as Senator Messner said. It represents the wishes of the people whom the Bills affect. After a lot of consultation with the various organisations-something the Government has not had-they have asked us to move an amendment. We have done that. It is not an ill informed vote. The comments of Senator Walsh are a reflection on a vote of the Senate. We do not accept the motion that has been moved and, if the Australian Wheat Board ceases to exist after 1 October, be it on the Government's head. The TEMPORARY CHAIRMAN —Order! We have dealt with that legislation. We are now dealing with another piece of legislation. Question put: That the Committee does not insist on the amendment made by the Senate to which the House of Representatives has disagreed. The Committee divided. (The Temporary Chairman-Senator Townley) Ayes . . . . . . . . . . . 33 Noes . . . . . . . . . . . 38 —— Majority . . . . . . . . . 5 —— Aulich, T. Hearn, J. M. Black, J. R. Jones, G. N. Bolkus, N. McClelland DouglasButton, J. N. McIntosh, G. D. (Teller)Childs, B. K. McKiernan, J. P. Coates, J. Maguire, G. R. Colston, M. A. Primmer, C. G. Cook, P. F. S. Ray, RobertCooney, B. Reynolds, M. Crowley, R. A. Richardson, G. F. Devlin, R. Robertson, E. A. Elstob, R. C. Ryan, S. M. Evans, Gareth Sibraa, K. W. Foreman, D. J. Tate, M. C. Georges, G. Walsh, P. A. Giles, P. J. Zakharov, A. O. Grimes, D. J. Archer, B. R. Lewis, A. W. R. Baume, Peter MacGibbon, D. J. Bjelke-Petersen, F. I. Macklin, M. J. Boswell, R. L. D. Mason, C. V. J. Brownhill, D. Messner, A. I. Carrick, Sir John Missen, A. J. Chaney, F. M. Parer, W. R. Chipp, D. L. Puplick, C. J. G. Collard, S. J. Rae, PeterCrichton-Browne, N. A. Reid, M. E. (Teller)Durack, P. D. Scott, D. B. Evans, Jack Sheil, G. Guilfoyle, Dame Margaret Short, J. R. Haines, J. Teague, B. C. Hamer, D. J. Townley, M. Hill, R. Vanstone, A. E. Jessop, D. S. Vigor, D. Kilgariff, B. F. (Teller) Watson, J. O. W. Lajovic, M. E. Withers, R. G. Question so resolved in the negative. Resolution reported; report adopted. Debate resumed from 20 May, on motion by Senator Grimes: That the Bills be now read a second time. Senator WALSH(Western Australia-Minister for Finance) —by leave-Prior to the commencement of the debate on the Dairy Produce Market Support Levy Bill, the Dairy Legislation Amendment Bill, the Dairy Produce Market Support Bill and the Dairy Industry Stabilization Levy Amendment Bill, I wish to draw to the attention of the Senate a matter of great importance. Senators will be aware that a number of amendments to these Bills have been circulated. These amendments are a misguided attempt by certain parties to assist the dairy industry. In particular, I understand that one of the amendments is directed at retaining export pooling for an interim period, yet export pooling is the single biggest contributor to the sorry state in which the industry now finds itself. The Government showed its vehement opposition to these proposed amendments in the other place. At a Press conference this morning, the Minister for Primary Industry (Mr Kerin) reaffirmed unequivocally the importance that the Government attaches to the package of dairy marketing arrangements proposed by these Bills, and in particular the immediate termination of export pooling. The Minister stated that the Government is not prepared to implement these Bills with the amendments which have been suggested. Rather, the Government will allow the existing arrangements to continue to operate. This option would surely see adjustment of the dairy industry, which all parties agree is necessary, but it would be a brutal adjustment with no certainty that the industry would be better off with this adjustment. Senators should note also the Minister's observation this morning that while the legislative framework of the present arrangements will continue to operate, underwriting which is at present provided by the Government pursuant to administrative arrangements will cease to operate on 30 June 1985. Nor would the Government propose to provide underwriting as long as the old arrangements continue. As well, the Minister would, of course, need to weigh carefully other decisions on key elements of the present arrangements if these were to continue. Senator CHANEY(Western Australia-Leader of the Opposition) —by leave-I will not delay for long the long awaited debate, but the rather extraordinary procedure which the Minister for Finance (Senator Walsh) has followed in giving us a mini-second reading speech and holding us all in terrorem is very unusual. I have to say that the record of this Government in dealing with the dairy industry is such that it is beyond me how we are supposed to take seriously any such comments. The attitude of this Government to the dairy industry was quite different when there was a Victorian election pending. All of a sudden the Government has developed a totally new approach because the election is out of the way. Quite frankly, we just do not take seriously the sorts of comments that have been made. We will put our views about the dairy industry. There will be a long second reading debate. We will move our amendments and I hope that they will be carried. Senator COLLARD(Queensland)(5.58) — What a fascinating few minutes we have just had in this chamber. In all the time I have been here I do not think I have seen a similar situation. In this chamber we have Standing Orders, a Constitution and privilege so that we can do and say things without fear or favour. Yet here we have a Minister of the Crown, the Minister for Finance (Senator Walsh), with the Dairy Produce Market Support Levy Bill, Dairy Legislation Amendment Bill, Dairy Produce Market Support Bill and Dairy Industry Stabilization Levy Amendment Bill threatening us-- Senator Missen —Browbeating us. Senator COLLARD —Browbeating us, blackmailing, whatever one likes. What a fascinating experience it has been for all of us. Senator Harradine —We are a House of review. Senator COLLARD —As Senator Harradine has just said, we are a House of review. We know how much attention the Australian Labor Party pays to the review capabilities of this House. We have had three short outbursts from Senator Walsh reflecting on the prospective votes in this chamber. In all rural legislation we have seen the attitude of the Labor Party to the rural sector. We have seen it not only in legislation that the Government has introduced but also in the innuendos in its mini-Budget. The rural sector is one of the great export earners at a time when this Government is in trouble, when international attitude towards this Government is reflected in the value of the dollar and when our balance of payments is in all sorts of problems. It is the one bright spot. It can pull us out. Yet if ever a sector has been singled out for special treatment by this Government, it is the rural sector. We listened to comments relating to the Wheat Marketing Amendment Bill and the Australian Dried Fruits Corporation Amendment Bill. The Opposition wants to maintain a majority of growers on their own boards. We want them to handle their own money and products. It is on record now that after 1 October the Minister for Primary Industry, Mr Kerin, will be the biggest wheat seller in the world. Be that on his head. These four Bills deal with milk that is generally entitled manufactured milk as against market milk, which is the milk that is produced for human consumption, supplied through home deliveries and sold in cartons and bottles. Manufactured milk goes into cheese, butter, casein and whole milk powder. There has been a dramatic rationalisation in the dairy industry over the last few years. It has had problems and it is well aware of them. The number of farms has decreased from 49,000 in 1964 to 18,300 in 1985. In terms of direct employment that means a reduction from 115,000 in 1964 to 50,000 in 1985. In the last 10 years there has been a drop from 388 factories employing 21,700 people to 264 factories employing 17,900 people. So over time the dairy industry has come to grips with its problem. That can be seen in the figures I have just mentioned. Milk production has fallen from 7.2 billion litres in 1970-71 to 6 billion litres in 1984-85. The dairy industry recognises that the optimum production which it needs at this point is about 5.3 billion litres. For all its troubles the dairy industry is still a great contributor to our overseas earnings and to our gross domestic product. In 1983-84 it pumped into the Australian economy $1 billion and was responsible for $350m in export earnings. If only those figures could be reflected in the amount of money that has been earned by the farmers. Farm income per work year of family labour in 1983-84 was only $4,325 for dairy farmers. I have two tables which I seek leave to incorporate in Hansard. Leave granted. The tables read as follows- PRICE CHANGES IN DAIRY PRODUCE COMPARED TO OTHER ITEMS, USING 1970 AS A BASE OF 100 Milk 341 Butter 260 C.P.I. 389 Average Earnings 535 Farmers' Costs 489 DOMESTIC PRICES OF DAIRY PRODUCTS IN SEVERAL COUNTRIES, IN US$/kg Country Butter Cheese Australia 2.87 4.30 Canada 3.99 6.00 United States 4.51 5.58 United Kingdom 3.22 4.37 France 4.54 5.17 Australian prices for these commodities have been frozen since 1982-manufactured products account for 50 per cent of farmers' incomes. Senator COLLARD —From the tables, one can see that dairy farmers' prices have increased but at a lesser rate than the consumer price index and their costs have increased at a greater rate than their incomes. On top of that we still produce the cheapest products of any of the countries mentioned in the second table. That puts into perspective the contribution that the dairy industry makes to our economy and to the CPI, vis-a-vis other countries. Our products are still cheaper than those of most other countries. Indeed, they are still cheaper than the countries we are competing against that are dumping those products on the world markets. The industry calculates that if the Kerin plan were implemented it could cost, giving the worst scenario, the jobs of up to 25,000 industry people. In reality, that would cost the Australian taxpayer $100m in welfare payments as well as the $20m promised in reconstruction funds. The Minister for Primary Industry has put up little defence or denial that the main thrust of this package is to force domestic prices of dairy products down close to export prices. Export prices are corrupt prices in that they are obtained through the dumping of milk products on the world market by the European Economic Community in particular. Mr Kerin, in his second reading speech, admitted that world export prices are grossly distorted because of subsidised production, especially in the case of the EEC and, to a lesser extent, the United States of America. The level of subsidies can be gauged from a table I seek leave to incorporate in Hansard. Leave granted. The table read as follows- A COMPARISON OF PRICES RECEIVED BY FARMERS FOR MANUFACTURING GRADE MILK, IN USc/KG (ACTUAL BUTTERFAT CONTENT) New Zealand 11.7 Australia 14.2 United States 27.8 United Kingdom 21.6 France 20.6 Senator COLLARD —The higher prices paid in these countries are in addition to other support mechanisms such as the threshold price for imports, import restrictions and import subsidies. New Zealand is the only country that has an efficiency advantage over Australia, and this is estimated at 22 per cent. Because of the artificially low export prices, it is estimated that there is a consumer transfer to dairy farmers of $96m. In the National Farmer Mr Kerin said: We must face fundamental international reality in terms of market and fundamental economic reality in terms of the state that our economy is in. This statement would have to be the ultimate in political hypocrisy. This Government now expects the farm sector to face reality and compete against subsidised exports being dumped on our markets. More importantly this Government refuses to deregulate that part of the community which most governs our cost. I refer to the labour market, which is the most overregulated and protected cartel outside the communist countries. This whole exercise smells of a shady deal that has been done with the Australian Council of Trade Unions. The Government will force down food prices under the guise of economic reality so that it can artifically lower the consumer price index in order to do a wages deal with the ACTU. Of course it is the farmers' livelihoods that are being treated with such cynicism. The four dairy Bills the Senate is discussing are the Dairy Legislation Amendment Bill, the Dairy Produce Market Support Levy Bill, the Dairy Industry Stabilization Levy Amendment Bill and the Dairy Produce Market Support Bill. The Dairy Legislation Amendment Bill gives the Australian Dairy Corporation more flexibility to borrow money to meet shortfalls in any particular fund. It will be able to shift money from one fund to another or borrow on the international money market. Most importantly, it will end export pooling by 1 July 1985. The Dairy Produce Market Support Levy Bill sets out the amount of levy put on milk to support the export of prescribed products. A three-year average for exports is to be calculated and domestic prices will be set at 130 per cent of that. A levy will then be applied to support exports. Any market underwriting collections will go into such a support fund. The Dairy Industry Stabilization Levy Amendment Bill provides for a levy on butter, butter oil and cheese. This levy is to provide support further to that provided by the all-milk levy and is designed to safeguard milk prices if they fall rapidly. The Dairy Produce Market Support Levy Bill sets for support purposes a variable levy with a maximum rate of 45c per kilogram of milk fat. This replaces the other levy system which applied to certain products only. It is estimated to work out at about 1.5c per litre, to be paid by the milk producer. The Government has also indicated that it will underwrite export returns at a level of 90 per cent of a three-year average. That is in case prices collapse below the General Agreement on Tariffs and Trade minimum. There will also be $40m adjustment assistance for the whole industry, not just for the farmers. There is a sunset clause that will cut off in 1990-91, with a review in four years. The industry has expressed quite a few concerns about this legislation and, as everybody will be aware, there has been a lot of consultation over the last few days. The cutting out of export pooling after July 1985 will cause some difficulties. The fear is that if this goes through before production levels fall people currently exporting will flood the domestic market or will cut each other's throat on the high return export market. If I may put that in another way, if a farmer had had a cow joined or artificially inseminated yesterday, depending on how he carries out his herd breeding, he would be looking at a commitment of at least 19 months by the time he gets through the rest of this lactation period and the next lactation period. Finishing the pooling system by July 1985 is too soon a cut off to allow the industry, and more particularly individual farmers, to adjust. That 19-months period is an absolute minimum. The industry is asking for a further two years of the existing system to allow for a less traumatic adjustment. One of the other concerns is that the cutting of support levels by reducing product levies will cause a quick depression of domestic prices, which of course is what the Australian Labor Party is all about. The Kerin plan is for the existing system to operate for 12 months and then be adjusted downwards by a formula which the industry estimates will reduce levies by 50 to 60 per cent in one year. The industry wants the present system to continue for two years and then be phased out in four equal steps by 1991. Another concern is the determination of export support payments. The industry is not happy about the three-year averaging, with one year being a forward estimate, and is not happy about the inclusion of whole milk powder in the prescribed products export scheme. The argument is that because of the high value-added content of whole milk powder there will be a bonus levy for this product. The whole milk powder manufacturers deny this. The industry wants the ADC to determine the amount of levy payable by relating it to the milk content of exported products. I will deal with that a little further when we are considering the proposed amendments in the Committee stage. Following consultation with the industry, the Opposition will move to amend three of the Bills in the Committee stage. The proposed amendment to the Dairy Legislation Amendment Bill provides for the carrying on of export pooling for a further two years, for the reasons I have indicated. There are other amendments which are basically sequential upon that proposed amendment. We propose an amendment to the Dairy Produce Market Support Levy Bill. This amendment will more closely define prescribed products, and is mainly to remove whole milk powder from the prescribed list. I will give more reasons for that proposed amendment when we deal with it in the Committee stage. There are consequential amendments to that proposed amendment also. The other proposed amendment, to the Dairy Industry Stabilization Levy Amendment Bill, will ensure that the present domestic pricing arrangements will continue for another two years and then be phased out in four equal steps by 1991. I foreshadow that those amendments will be moved in the Committee of the Whole. They have been circulated. Even though the dairy industry as a whole does not like the Kerin plan and does not want it to be instituted, and in spite of all the invective we heard from Senator Walsh, the industry basically accepts the thrust of the plan. The proposed amendments basically allow the Kerin plan, except for the provisions pertaining to whole milk powder, to be phased in over a longer period so that the industry will have more time to adjust. I will explain those provisions in a little more detail when the Bills get to the Committee stage. The Opposition will not be opposing the second readings of the Bills but will be moving the amendments circulated in my name when in the Committee of the Whole. Senator COONEY(Victoria)(6.17) —Senator Collard has criticised in fairly round terms the approach the Australian Labor Party has taken to rural industries, in particular to the dairy industry, and has criticised the present Government for its attitude expressed, as he says, through these four dairy Bills. If one takes a quiet and proper approach to these Bills it will be seen that they create a scheme which is essential for the well-being of the dairy industry. The Bills deal with the way in which payments made for milk and milk products are to be distributed amongst producers and manufacturers. Accordingly, they affect the dairy industry profoundly, as has been illustrated by the interest the dairy industry has taken in the Bills. As Senator Collard says, many people from the industry have come to Canberra to put their case. They have put their case properly, with force, and most impressively. The fact is that payments can be distributed by an untempered market, by detailed regulation, as is presently the situation, or by both market forces and regulations operating in various degrees. It is a matter of looking at these various means of distributing the income raised from the dairy industry and seeing in what way it can most fairly be distributed, having regard not only to the producers and the manufacturers of milk-though they are of great importance-but the public. The present situation in the dairy industry has arisen in circumstances in which it has been heavily regulated. That is accepted. The situation is an unhappy one. Farmers who work hard and efficiently are denied adequate rewards for their efforts and Australian consumers pay substantial subsidies for overseas consumers of Australian products. Australian consumers pay substantially more for similar products. In those circumstances there is general agreement that extensive change is required to the industry in the interests of both that industry and the consumer of its products. There is agreement as to the general thrust of what the reforms should be. In contrast to what Senator Collard has said, the dairy farmers and all the people in the dairy industry agree that the general thrust of the reforms put forward by this Government are correct. The argument does not go to the general thrust of the plan; the argument is about the timing and the details of the reforms suggested. In dealing with the present legislation it is important to keep some things in mind. First, the reform of the dairy industry is necessary, and is seen as being necessary by those connected with it. People who have come to see members of parliament in Canberra or in the electorates in the various States have said that. They understood that reform was necessary and they praised the general thrust of the scheme put forward by this Government. Reform of the dairy industry is seen as necessary, and is, in fact, necessary. Secondly, the reform of the industry has been widely and responsibly discussed within industry and by government. This is certainly not a scheme that has been brought forward out of the dark and revealed suddenly in a flash of light. It has been discussed within the industry and extensively by those responsible in the Government, and it has come forward as a result of those discussions. Thirdly, the general approach of the legislation before the Senate has wide acceptance in the industry following those discussions. Fourthly, unless something is done, and done quickly, the present situation, with all its faults-and they are numerous-will persist. Something has to be done. We cannot simply remain static because the industry is in need of overhaul. Unless that is done quickly the whole situation will drift on. It has been suggested here that we wait for two years before we do something. What will happen over those two years? What will motivate the industry to move to a situation where it becomes viable in all its dimensions-not only some of them-unless something is done quickly? To delay is simply to delay the inevitable. Fifthly, few changes are ever introduced which do not give rise to the argument that the interests of at least some people are prejudiced. That argument has been put forward in this case; that some people will be affected adversely. It is proper that those arguments be listened to and be considered. Those arguments have been listened to and have been considered by the Government. The sixth point is that this legislation will bring benefits to the consumers of dairy products and to the large-- Senator Boswell —What about the farmer? Senator COONEY —And to the large majority of people in the dairy industry. Senator Boswell says: 'What about the farmer?'. That is a very legitimate question. Of course the farmers should be kept very much in mind, and the fact is that farmers have been kept very much in mind. As I said before, farmers have given approval to the general thrust of the scheme to be brought forward by this legislation. Senator Boswell —I don't know what farmers you were talking to. You must have been in Queen Street, Melbourne. Senator COONEY —There are very few farmers in Queen Street, Melbourne. No doubt Senator Boswell will put the argument that farmers are put at risk by this legislation. That is a fair proposition; but that will be a minority of farmers. I would be interested to hear whether Senator Boswell has evidence that more than a small minority of farmers will be put at risk by this legislation. Of course, it should be a matter of concern to all that people are put at risk. However, an argument that the risk is universal or is faced by a majority of farmers is ill-founded. Further, to argue that some farmers are put at risk by the proposed scheme and to ignore the risks that those very farmers face under the present one is to argue selectively. In other words, it is not good enough to say that a significant number of people are adversely affected if the honourable senator cannot then go ahead and say that the alternative that he suggests will benefit them and others as well. The honourable senator cannot simply produce an argument that there are some unfortunate effects of a particular piece of legislation, and say that responsibly, without putting forward an argument and producing evidence to show that alternative legislation, or the failure to put that legislation into operation, will give greater benefit to the people whom the honourable senator purports to represent. He must produce evidence and an argument other than one of simply condemning the legislation and saying that some people may be adversely affected by it. The fact is that the dairy industry as a whole, and the Australian people who purchase its goods, will gain mightily by this legislation. Provision has been made to accommodate the adjustment of those adversely affected by the scheme. Senator Collard mentioned the fact that $40m has been made available to facilitate the adjustments that may occur in the industry. Senator Boswell —That is the farmers' money. They put that in. It is not a government grant. Senator COONEY —I do not see where that argument gets Senator Boswell. All I am saying is that $40m- Senator Boswell —Don't talk about the Government being so magnanimous as to put in $40m. Senator COONEY —Does Senator Boswell want to hear an answer? The ACTING DEPUTY PRESIDENT(Senator Colston) —Senator Boswell, you are on the list to speak after a few other speakers. I suggest you keep your comments until then. Senator COONEY —I want to answer that, Senator Boswell. Of course the $40m may come from the farmers. But that was not the argument. The argument was whether money is available to facilitate the adjustments. I am simply saying that it is. If the honourable senator is saying that the $40m is not there to facilitate the adjustments that may be necessary as a result of this legislation he may say so during his speech. But it is not to the point to simply say: 'Look, even though there is $40m, that comes from a source from which I would prefer it not to come'. That is no argument at all. I agree with the honourable senator that a decision to reform ought to be made after balancing the advantages and disadvantages that will flow from it. There are usually perceived disadvantages to some following reform, but if the reform is worth while, the advantages that flow from it make it essential. In the present instance the advantages that will flow from the reforms encompassed by this legislation are absolutely essential. Why? The fact is that there is an overproduction of milk. There is a distortion in the sale and distribution of milk products. Senator Collard, in a speech in which he put his arguments strongly and firmly, nevertheless failed to address the central issue in this matter-the question of the market and what the market demands. There is presently a distortion in the sale and distribution of milk products and in the money that comes from those products which has been brought about by mechanisms including those over which entities other than the Commonwealth has control. That is to be remembered. The Commonwealth has only part control over the milk industry. For example, the European Economic Community has created circumstances in which surplus milk has been produced in floods. Senator Collard said that the EEC has acted irresponsibly. I agree with that. But what can this Government and this country do in that situation? Honourable senators opposite may be able in this debate to give some assurances about what they believe the States can do. For example, State governments have regulated the dairy industry under their jurisdiction so that some of those in it profit greatly and others lose. It would be interesting for people here to go to States like New South Wales and Queensland and talk to them to see whether those States would allow the flow of Victorian milk into their States. That is something we could do-deregulate the State markets to allow Victorian milk, the milk most efficiently produced in this country, to flow north. Victorians produce about 60 per cent of Australia's milk. Of that amount, 87 per cent forms the basis of manufactured products. Those manufactured products are exposed to severe competition from other countries, and it would be very helpful if there were markets available for them in this country. Given the keenness of honourable senators opposite to see something done about the industry, here is one way in which they could show that they are intent upon doing just that, by going to the States from which they come and influencing those States to open their markets to Victorian milk. I have spoken about the limited role the Commonwealth Government can play in the bringing of order and profitability to the dairy industry. But the Federal Government has a significant potential to effect reform of the dairy industry through its power over the returns received for exported milk products. This legislation will carry forward much needed reform by abolishing the present pooling of returns from the sale of dairy products whereby the returns for exported products are subsidised. At the moment, levies are raised on domestic sales of certain products and distributed across all production, including production for export sale. At the moment there is no levy on milk which is used to produce products for export sale or on the sale of goods so produced. This means in fact that the returns from the sale of milk products on the domestic market subsidise Australia's export of such products. Australia's exports have been mentioned. It has been pointed out that the rural industry, and the dairy industry in particular, contributes mightily to our export earnings and that the industry should be praised highly for that. The fact is that, as things now operate, Australians are subsidising very substantially the price paid for Australian milk products used overseas. It also means that all producers get the same return, irrespective of their ability or industry. On the other hand, the scheme to be introduced by this legislation will ease the burden presently placed on the Australian consumer. Further, it will reward the farmer who displays greater ability and industry than his fellows. It has to be kept in mind that this scheme will continue to support the dairy industry. It will ensure that producers will receive at least 130 per cent of the average financial returns for milk products exported over three years, including the current year and the two immediately preceding. The means of financing the necessary mechanisms will be raised from a levy to be paid by farmers on the sale of their milk. The scheme will include all milk and not, as formerly, only milk used to produce milk products. In the beginning a levy will be paid by the consumer on the purchase of certain milk products, specifically butter, oil and cheese. The levy paid by the consumer will be phased out according to a formula provided for in the legislation. There has been some concern about this from the farmers who have come to Canberra and who have approached members of this place. Provision is also made, as I have said, to facilitate adjustments which are required in the industry. It is said that there ought to be a two-year delay in the introduction of this scheme. The fact is that a delay in instituting this scheme would be a delay in bringing order and profitability to dairying and the manufacture of dairy products and, at the same time, a delay in bringing relief to the Australian consumer. The reality, whether it is perceived as a grim reality or otherwise, is that any delay is a delay in achieving the inevitable. Inevitably reform must be introduced. If it is put off, that simply means that the cure for the industry is delayed. It has been suggested that the scheme could be improved by making certain amendments to it. The suggestions include the continuation of the pooling system for two or more years-Senator Collard touched on this-instead of cutting it off from 1 July 1985. A suggestion also was made that the method used to calculate the market support payments under the scheme should be altered. Another suggestion was the use of a formula different from that contained in the legislation, to phase out levies on milk products. I wish to make some comments on those three suggestions. The first was that the pooling provisions be continued for two or more years. The reality of pooling is that it is the central cause of the industry's present problems. Amongst other things, it has caused the following difficulties: Firstly, it has augmented the costs, in particular of milk products; secondly it has encouraged over production of milk; thirdly, it has provided the greatest degree of assistance to the otherwise least viable part of the market; fourthly, it has stopped or hampered the development of new products and new markets; and fifthly, it has directed the minds of manufacturers towards production rather than marketing. Indeed, that was the situation to which Senator Collard referred. He argued his case in terms of the efficiency with which the Australian industry produces its milk. There can be no doubt that he is correct in saying that. Indeed, his analysis is a worthy one. His speech will be worth reading in Hansard. But what he ignored is efficiency in the market-place. One can have the efficiency in production and efficiency in the market-place. In my view, what honourable senators opposite must turn their minds to in the arguments which will follow is the question of how one can make the marketing of milk an efficient exercise. There can be no argument that the milk is efficiently produced; indeed, that is one of the great tragedies in this situation. As Senator Collard has pointed out, farmers in this country produce milk and milk products much more efficiently than elsewhere, but they do not receive from the market the sorts of returns that they should receive. As he said, the markets are distorted. Among others, the European Economic Community creates problems, the ramifications of which are tragic to many farmers. That is unfortunately the situation that they face. The second suggestion was that the method of calculating market support payments be changed from that provided in the scheme presented in this legislation to one based on a milk yield formula. That suggestion diminishes too greatly the part that the market should play in the industry. The Government intends to give the market its proper place in this scheme. It should not be the sole determinant but it has a proper place in the determination of where the industry goes. It is the Government's intention through this legislation, to give the market its proper place in the scheme of things. The third suggestion was that the phasing out of the levy on milk products should be accomplished by a number of equal steps rather than according to the formula set out in the scheme. The fact is that the scheme is based, and based correctly, on the proposition that there be flexibility and sensitivity to the adjustments that occur in the industry. Senator Macklin —Unpredictability, as well, though. Senator COONEY —I follow what Senator Macklin is saying, but the fact is that it is expected that this scheme may work in different ways; in other words, that the effect on the industry may be different-- Senator Boswell —It is a loser every way you look at it. Senator COONEY —I will answer Senator Macklin first. I put it this way: The scheme should be so arranged that it is able to meet whatever eventualities develop, whereas if we have, as it were, a fixed phasing out, that fixture makes the whole scheme too rigid to accommodate the problems that may arise in different situations. If there is a fixed means of phasing out the situation may be held too rigidly, which may not operate to the benefit of the whole scheme. I understand that honourable senators opposite say that there ought to be a number of equal steps to phase it out; if we do not have that the scheme becomes too uncertain. As the scheme operates there will be more flexibility, which will be to the benefit of industry and the consumer. These Bills will replace the legislation on which the dairy industry presently operates. The legislation, when enacted in 1977, contemplated a scheme of assistance to the industry to be introduced in three stages. It is an indication of the difficulty that we have in wrestling with the problems that have occurred in this industry and is illustrative of those problems that only one stage of the three proposed stages has ever been brought into operation. That scheme has been found wanting. I have not heard any suggestion that the scheme which was introduced by Mr Sinclair should be maintained in its pristine form. The industry is constantly changing. One can understand that, given the effects of world and local markets and the fact that many people have come into the industry and have increased production recently. All these things make a very fluid situation within which the dairy industry operates. Given that the scheme is not working at present, other schemes must be looked at. In that context this scheme, which unashamedly is based very largely on a consideration that the market place ought to decide issues in terms not only of the-- Senator Watson —Which market? The overseas subsidised market? That is an unreal market. Senator COONEY —That is true. After proper consideration, this Government has gone ahead to look for an alternative to the scheme which has been found wanting. Senator Watson says that overseas products are subsidised. That is so. Senator Watson —It is not a true market. Senator COONEY —Of course it is not a true market; it is unjust and unfair. I am willing to agree with all those propositions, but the difficulty is: What do we do now? Senator Collard gave a series of figures to indicate the situation regarding Australian farmers. It is a tragic one. Something has to be done. The Opposition says: 'Look at these farmers. Look at how they suffer as a result of the activities of European countries'. I can only agree with the Opposition there, but it is only a step along the path. What do we do about it? We cannot declare war on the European countries and blow up their vast lakes of milk. We have got to look at what can be done in the real situation. That is what this legislation does; it looks at the real situation. Certainly there are tensions and problems in trying to adjust to the real situation, but unless we adjust we will get nowhere. The whole thing just goes further and further down the hill gathering speed until there is complete disaster. We have faced that problem and we have found what we want. On coming to office we found the scheme wanting. It was not sufficiently oriented to the market. I take the point that the market has been distorted, nevertheless that is the market we have to face. To ignore the proper part the market should play in the scheme contained in the legislation presently being considered would be to retreat to failure. That is the reality of the matter. If we retreat, we retreat to failure. Such a retreat would be irresponsible. Senator Watson —You had a better alternative. Senator COONEY —No doubt the honourable senator will be able to talk about the different alternatives. In looking at those alternatives he must remember that the Minister for Primary Industry (Mr Kerin) and this Government have looked closely, and sympathetically-I use the word advisedly-at all those alternatives. No matter which way they looked, the reality is that none produced as good a scheme as the one presently before the Parliament. As I said, the general thrust of that scheme has been accepted. Senator Boswell —In whose opinion is that? Senator COONEY —Senator Boswell may be speaking to different farmers and farmer organisations from the ones that I have spoken to. The general thrust has been accepted across the industry. Senator Brownhill —You listened to the ACTU but you don't take any notice of the dairy farmers. Senator COONEY —I will say something about the Australian Council of Trade Unions and the workers. Senator Collard said a few things about the ACTU and the workers. I am sure it was simply the puff of debate. To try to place the problems of the dairy industry on the backs of workers and on the ACTU is really irresponsible. I am not saying that Senator Collard is irresponsible; I am saying that the effect of that is irresponsible. The workers have nothing to do with this. Senator Boswell —They won't have a job after you have finished with them-20,000 will be out of work. Senator COONEY —The fact of the matter is that the workers and the ACTU have contributed mightily to this country. If the honourable senator reads the report of the Hancock Committee of Review on the Australian Industrial Relations Law and Systems which was tabled in this House yesterday he will see the contribution that both the workers and the ACTU have made to this country. It is just not right to criticise decent, honest Australian workers and their peak organisations for problems which have nothing to do with them, problems which this Government has responsibly tried to cure. Debate (on motion by Senator Grimes) adjourned. Bill received from the House of Representatives. Ordered that the Bill may be taken through all its stages without delay. Bill (on motion by Senator Grimes) read a first time. Senator GRIMES(Tasmania-Minister for Community Services)(6.49) —I move: That the Bill be now read a second time. I seek leave to have the second reading speech incorporated in Hansard. Leave granted. The speech read as follows- This Bill implements two decisions of the Government which were announced a short time ago. Nursing Homes Assistance Act 1974 The first decision is that there will be no Commonwealth funding of any new or additional services provided in nursing homes to other than nursing home patients, where those services are not approved or approved-in-principle prior to 21 August 1985. Commonwealth funding for services which have been so approved before that date will be maintained, with adjustments for necessary cost increases. At present, the Commonwealth funds a number of services which are provided in nursing homes, for both nursing home patients and aged or younger disabled persons in the surrounding community. To date, the Government has considered it reasonable that the Commonwealth should fully meet the costs of these services. However, the direction of Commonwealth funding in this field is changing rapidly. Further decisions in this area will be announced at a later date. It is expected that this measure will save $0.5m in the remainder of the 1985-86 financial year and $0.5m in the 1986-87 financial year, and that savings will accumulate at the rate of $0.5m in later years. Social Security Act 1947 The second decision is to discontinue, as from 1 November 1985, the payment of family allowance in respect of student children who have attained the age of 18 years. There will be some limited exceptions to the new rule. In general, these are designed to ensure that groups of people in needy circumstances will continue to receive family allowance. This decision will enable scarce welfare funds to be directed to the many impoverished and needy members of our community. It is expected that savings from this measure will be in the order of $20m in the remainder of the 1985-86 financial year and $30m in the 1986-87 financial year. I commend the Bill to the Senate. Debate (on motion by Senator Sheil) adjourned. Bill received from the House of Representatives. Ordered that the Bill may be taken through all its stages without delay. Bill (on motion by Senator Grimes) read a first time. Senator GRIMES(Tasmania-Minister for Community Services)(6.50) —I move: That the Bill be now read a second time. I seek leave to have the second reading speech incorporated in Hansard. Leave granted. The speech read as follows- The purpose of this Bill is to amend the Defence Re-establishment) Act 1965 to provide that no further loans or guarantees are to be granted under the Defence Re-establishment Loans Scheme in respect of applications received after 14 May 1985. The Defence Re-establishment Loans Scheme was designed to assist eligible veterans to make the transition to civilian life by providing finance for them to establish business or agricultural ventures. Decisions by successive Governments not to increase the loan amounts have meant that the loans no longer provide a useful contribution to the cost of establishing a business or agricultural venture. The maximum value of the loans has not been increased since 1975. Budget restrictions will not permit increases in the loans. The Scheme has been managerially inefficient because of legislative and public accountability requirements. The cost of administering the loans is high and in the financial year which ended on 30 June 1984, approached 20% of the value of the loans issued during that year. The Re-establishment loan, at $10,000 for agricultural ventures and $5,000 for business ventures, is simply a cheap alternative source of a small part of the finance required to re-establish a serviceman or woman in civilian life. The Government believes this scheme is now out of date, because its objective as a re-establishment measure is not being met and it is inefficient to administer. This is reflected in the fact that only about 200 loans are approved each year. Applications for loans and guarantees under the scheme, received on or before 14 May 1985 will be processed normally. Loans and guarantees which have been granted will not be disturbed by this amendment. 14 May 1985 was the date of the Government's statement of the intent to abolish Defence Re-establishment loans. I commend the Bill to the Senate. Debate (on motion by Senator Sheil) adjourned. Bill received from the House of Representatives. Ordered that the Bill may be taken through all its stages without delay. Bill (on motion by Senator Grimes) read a first time. Senator GRIMES(Tasmania-Minister for Community Services)(6.52) —I move: That the Bill be now read a second time. I seek leave to have the second reading speech incorporated in Hansard. Leave granted. The speech read as follows- The purpose of this Bill is to give effect to certain savings proposals announced by the Treasurer on 14 May 1985 which affect the Repatriation pension system. The Bill now before the Senate makes amendments to the Repatriation Act 1920, the Interim Forces Benefits Act 1947, the Repatriation (Far East Strategic Reserve) Act 1956, the Repatriation (Special Overseas Service) Act 1962 and the Seamen's War Pensions and Allowances Act 1940. Standard of Proof As the Treasurer stated, the Government has recently reviewed the conditions applying to the grant of Repatriation pensions as part of its overall economic review of forward estimates of expenditure. In this review the Government paid particular attention to a recent decision of the High Court which involved an interpretation of the onus and standard of proof required under section 47 of the Repatriation Act 1920 to be applied by the Repatriation Commission when it determines a claim for a disability pension by a veteran or a claim for a war widow's pension in respect of a veteran's death. Section 47 of the Repatriation Act, which was inserted in 1977, states that the Repatriation Commission must grant a claim for pension unless it is satisfied, beyond reasonable doubt, that there are insufficient grounds for granting the claim. In February this year the High Court, by a majority of 3 to 2, gave its decision in the case of Repatriation Commission v O'Brien. In this decision, the High Court confirmed a view previously expressed by the Full Court of the Federal Court of Australia that section 47 of the Repatriation Act 1920 could require that a disability pension or war widow's pension be paid even in a case where there is no evidence which points to there being a reasonable possiblity of a connection between the veteran's incapacity or death and the veteran's war service. On this view, in order for a pension not to be granted it would appear that the Repatriation Commission would have to demonstrate conclusively that the cause of a veteran's incapacity or death was not contributed to in any way by anything related to the veteran's period of war service. Honourable Senators will appreciate that such an onus of disproof at the criminal standard is virtually impossible to satisfy in almost all cases, particularly where the origins and development of the disease that cause the veteran's death are not fully explainable by medical science. Before the 1977 amendment, section 47 had required Repatriation determining authorities to give the claimant the benefit of any doubt as to the existence of any fact, matter, cause or circumstances which would be favourable to the claimant and as to any question which arose for decision under the claim. Determining authorities were also directed to draw from the evidence furnished to them, including medical opinions, all reasonable inferences in favour of the claimant. The legislation also stated that the onus of proof lay, not on the claimant, but on the person or authority contending that the claim should not be allowed. While there was a good deal of confusion about the exact meaning of this ''benefit of doubt'' provision, it was understood that the ordinary civil standard was to be applied to the proving of material facts. Mr Justice Toose, who conducted the Independent Inquiry into the Repatriation System, thoroughly examined the standard of proof issue. In his report in 1975 he said (at p. 254) ''I am of the view that matters, such as the criminal burden of proof beyond all reasonable doubt, do not arise in pension proceedings. 'Benefit of doubt' in the Repatriation legislation arises only in the matter of adjudicating if the determining authority is in doubt''. His Honour concluded that the provisions of the then section 47 had proved unsatisfactory and should be amended. His Honour then recommended (at p. 256) that ''the Act should provide that a determining authority, when considering the evidence, should draw all reasonable inferences in favour of the claimant and accept as proof any credible evidence of the claimant which is not contradicted. In weighing the evidence, if there is any doubt, that doubt should be resolved in favour of the claimant''. When the Second Reading Speech to the 1977 amendments of the Repatriation Act is examined, it is clear that the then Government intended to clarify the meaning of section 47 consistent with the views expressed by Mr Justice Toose. There is no indication that the Government intended that section 47 be so substantially modified as to impose a standard of disproof at the criminal standard to the determination of Repatriation pension claims. It would seem that the Government of the day was intending to clarify that the 'benefit of any doubt' in section 47 meant the benefit of any reasonable doubt. Since section 47 was amended in 1977 there has been a good deal of judicial consideration of the present standard of proof contained in section 47. In October 1981, in Repatriation Commission v Law, the High Court stated that the standard of proof in Repatriation pension matters required that ''in relation to any fact necessary to establish entitlement, the Review Tribunal must be satisfied beyond reasonable doubt that the fact does not, or did not, exist before it could refuse an application or dismiss an appeal by a claimant''. In 1982, in Lennel v Repatriation Commission, the Full Court of the Federal Court of Australia indicated that there was to be no automatic grant of pension when a veteran died of a disease, the cause of which was unknown. However, in 1984, in O'Brien v Repatriation Commission, the Full Court of the Federal Court of Australia said that, in order to satisfy the criminal burden of proof applied by the Act, the Commission would not necessarily satisfy the Tribunal beyond reasonable doubt that there are insufficient grounds for granting a claim even if there was no material which pointed to a connection between incapacity or death and war service. This view was confirmed by the majority decision of the High Court in O'Brien's case in February this year. In his minority decision in that case, Mr Justice Brennan described the present section 47 as ''a piece of administrative legerdemain'', because it ensures that in the administration of the Act the prescribed conditions of eligibility should not be required but that claims be granted unless it appears beyond reasonable doubt that those criteria are not fulfilled. His Honour suggested that section 47 needed to be applied on the following basis: if the facts of a case supported a reasonable hypothesis of requisite connection between incapacity or death and war service then the Commission must grant the claim; if a reasonable hypothesis of entitlement arises on some of the facts then the Commission must grant the claim unless other facts dispel the hypothesis; if however, the Commission is satisfied that there is no reasonable hypothesis of entitlement on the known facts or that any such hypothesis contended is dispelled by other facts, then there are insufficient grounds for granting the claim. I remind Honourable Senators that the Parliament legislated as recently as last year to set up a three-tiered determining system. This was hardly a sign that the Parliament believed that there was to be virtually automatic acceptance of disability and war widows' pension claims. It has always been accepted that the Repatriation pension system should be generous. Nevertheless generosity seems to have gone beyond reasonable bounds in a situation where a pension must be granted in respect of a veteran's incapacity or death even if there is no evidence raising a reasonable possibility of a link between the incapacity or death claimed and the veteran's period of eligible war service. This in fact is the position because the effect of section 47, in the light of its interpretation by the Courts, is to bring the determination of disability pension claims close to one of automatic acceptance for the vast majority of claims. It is not surprising that claims for disability pension are pouring into the Department of Veterans' Affairs and that expenditure on disability pensions and war widows' pensions is increasing rapidly-by 55 per cent and 70 per cent respectively over the past three years. The Bill I am now introducing draws on Mr Justice Brennan's proposition. It provides in respect of all claims for pension that where the Repatriation Commission is reasonably satisfied that the material before it does not raise a reasonable hypothesis of a connection between the death and incapacity of a veteran and the veteran's war service, or that any such hypothesis which has been raised, has been dispelled, a pension shall not be granted. The requirement that there be established such a reasonable hypothesis of a war service connection is intended to ensure that a pension is not payable merely because there is a theoretical connection which is of a remote, fanciful or tenuous nature. In addition, it is proposed to continue to apply the criminal standard of proof to claims for pension in respect of: first, a disability where a veteran had overseas war service or where, during service in Australia in World War II, the veteran was personally engaged in direct combat against the enemy; second, a disability where a veteran was allotted for operational service in Korea, Malaya/Borneo or Vietnam; third, a disability suffered by a member of the Defence Force where he served on peacekeeping duties overseas or where the member is involved in hazardous duties so designated by the Minister for Defence; and fourth, death for these three categories except where the veteran or member died or dies 40 years or more after eligible service. In respect of claims in relation to the four categories I have just mentioned, I want to make it clear that a claim must be granted unless the determining authority is satisfied beyond reasonable doubt that there are insufficient grounds for doing so. This is the standard of proof, subject to the proposed requirement that there be a reasonable hypothesis of a link between death or incapacity and service, that presently applies. Apart from these types of claim for pension I have specified, all other pension matters arising for determination under the Repatriation legislation will be determined on the civil standard of proof in the ordinary way i.e. that the determining authority is not to grant a pension unless it is reasonably satisfied that there are sufficient grounds for doing so. As far as the change in respect of a war widow's pension is concerned, Honourable Senators will accept that there are very few conditions which would take 40 years or more to manifest themselves. This is why it is proposed by the Bill that in cases of death more than 40 years after a veteran's war or other qualifying service, a claim for war widow's pension will be determined on the civil standard of proof as I have described it. At present it is not unusual for deaths of veterans aged over 80 to be accepted as war related in circumstances where common sense suggests that the ageing process or normal causes of death in the community were reasonable explanations. The inequity of the law as it stands is evident if we consider two groups of widows. On the one hand are those widows whose husbands, on whom they were usually financially dependent, were killed during service or died as a direct result of injuries or disease suffered during war service. On the other hand there are widows receiving war widow's pensions who are not in financial need, whose veteran husbands had full working lives, were available for the period since war service to help with family responsibilities but whose deaths did not disclose evidence of a direct connection with war service. In both cases, war widows' pensions are payable and precisely the same tax free and means-test free pensions and treatment entitlements apply, although it is often difficult to see any evidence linking the deaths of recently deceased veterans to their war service. I emphasise that in future a war widow's pension will continue to be payable to a widow of a T &PI pensioner. Assessment of the Rates of Disability Pension The Bill, by amendments to the Schedules to the Repatriation Act 1920, proposes changes to clarify the circumstances in which disability pensions are to be paid at a rate higher than the general rate. Since 1920, there has been a special rate of disability pension payable in circumstances where, because of total and permanent incapacity resulting from war service, a veteran has been unable to resume or to continue in civil employment. The Special or T&I rate pension was designed for severely disabled veterans of a relatively young age who could never go back to work and could never hope to support themselves or their families or put away money for their old age. It was never intended that the T&I rate would become payable to a veteran who, having enjoyed a full working life after war service, then retires from work possibly with whatever superannuation or other retirement benefits are available to the Australian workforce. Determining authorities have found the application of the present legislative provisions difficult because the provisions, unchanged since 1920, contain outmoded and imprecise terms. The amendments clarify the eligibility criteria and make it clear that, to qualify for T&I pension, a veteran must be eligible for the 100% general rate pension. In addition, the T&I rate pension can become payable only when a veteran is totally and permanently disabled by accepted disabilities and is thereby precluded from continuing to engage in remunerative work. If a person has had the usual span of a working life or has retired voluntarily or has left employment for reasons other than accepted disabilities, a T&I pension is not payable. It would be in only very rare cases that any veteran beyond the normal retirement age could be eligible for this pension. Special provision is made by the Bill to cover veterans who are under 65 years of age, are unemployed, and are genuinely seeking to engage in remunerative work. An intermediate rate pension may be payable where a veteran is prevented by accepted disabilities from engaging in other than part time or intermittent work. The Bill clarifies the test for this rate of pension in a similar way. Part time work is to be less than 20 hours work a week. Dependant's Pension The Bill also contains amendments to delete from future grants of disability pension the provision of separate nominal benefits to the wives and children of such pensioners. The rates of dependants' pensions have not changed for more than 20 years. Some entitlements are as low as 28 cents per fortnight and cost more to pay than the benefits themselves are worth. It is also intended to delete some now outmoded provisions whereby small pensions are payable to those members of a deceased veteran's family, other than a wife or child, e.g. the parents or grandparents of an unmarried veteran. These people are now provided for in the general social security system. It is proposed that no new grants of these dependants' benefits be made. Existing beneficiaries will have payments frozen at current levels. I emphasise that the dependants' pensions referred to in this context do not include war widows' pensions and orphans' pensions. Savings Provisions The modifications proposed to the application of section 47 and the criteria for the assessment of Intermediate and T&I rate pensions will apply to future determinations of pension claims and the assessment of pension increases. Pensions already granted will not be affected by these amendments. The amendments relating to Special Rate and dependants' pensions and to the O'Brien decision will apply as from the date of effect of this legislation. Where the amendments relating to the application of the civil standard of proof are proposed to apply to claims for pension, they will apply to all such claims and applications for review lodged from 15 May. Because of the backlogs in the determining system, it is most unlikely that any claims or applications for review lodged from tomorrow onwards will be determined before the amending legislation comes into effect. In any event claims and applications for review will be determined as closely as possible to the order of their lodgement in the Department. Financial Impact Since the High Court's decision in Law's case in October 1981 there has been a dramatic increase in the number of disability pension claims lodged which goes far beyond what might have been expected, even allowing for the ageing of the overall veteran population. In 1980-81, 22,000 claims for pensions and applications for increase were lodged. In 1984-85 there are likely to be 33,500 entitlement claims and 15,000 applications for increase in pension-a total for the year of 48,500. In short the number of claims will have increased by 120 per cent in four years. This increase is despite the fact that the number of surviving veterans will have decreased during the same period from 636,500 to about 560,000. Acceptance rates have also increased dramatically. In 1981-82 the acceptance rate for pension claims at the first level was 50.9 per cent. The acceptance rate following the O'Brien decision is approaching 80 per cent and still rising. At the Veterans' Review Board, reviews of entitlement claims have an acceptance rate of 87 per cent. The acceptance of war widows' claims by the Veterans' Review Board is now close to 100 per cent. The financial impact of this trend is enormous. Whereas in 1981-82 expenditure on disability pensions was $303m and on war widows' pensions $206m, the 1984-85 figures will be $469m and $350m-increases of 54.8 per cent and 70 per cent respectively. In relation to T&I pensions, up to 1981-82 there was a steady decline in the number of pensioners. By early in 1982 there were 14,000. Since then there has been a continual growth in their numbers to the present figure of 21,800. It is estimated that, if the trends in lodgement of claims and acceptance rates for disability and War Widows' pensions were to continue, expenditure in 1989-90 would be $650m a year higher than this year's expenditure. Savings from the legislative amendments in this Bill are expected to be $36.8m in 1985-86 and substantially more in subsequent years. Conclusion Honourable Senators are aware of the Government's intention to rationalise and simplify Repatriation legislation through a new Veterans' Entitlement Bill. That Bill will be introduced later in these sittings but, so that Senators and ex-service organisations, in particular, may study its content, it will not be debated until the Budget Sittings. The changes announced in the Treasurer's statement need to be enacted as soon as possible through amendments to the existing Repatriation legislation. These amendments will be incorporated into the Veterans' Entitlements Bill at the earliest opportunity after passage of this Bill. I repeat that in the determination of claims for disability and war widows' pension the legislation continues to protect the legitimate claims and rights of the veteran community. The Act will continue to provide that the requirement to submit evidence in support of a claim for pension shall not be taken to impose any onus of proof on a claimant. The Department of Veterans' Affairs will continue to have statutory responsibility for investigating relevant matters where a claim for pension is made. The Act will continue to provide that, in determining any claim, a determining authority is required to act according to substantial justice and the merits and all circumstances of a case. The Act will continue to take account of difficulties that lie in the way of ascertaining facts for any reason attributable to the effects of the passage of time, including on the availability of witnesses, or to any deficiency in official records. Finally, let me reiterate the Government's commitment generally to the continuation of generous and effective benefits and treatment for those who suffer because of their war service for Australia. Australia has by far the most comprehensive and generous repatriation benefits in the world. After the Bill I have introduced becomes law this will still be the position but the savings achieved, in addition to helping to meet the objectives of the total savings package, will provide scope for future improvements in repatriation hospitals and in programs to care for our ageing veterans and war widows. I commend the Bill to the Senate. Debate (on motion by Senator Collard) adjourned. Appointment of Committee of Reasons Motion (by Senator Collard) agreed to: That Senators Collard, Macklin and Archer be appointed to a Committee of Reasons to draw up the reasons for the Senate not agreeing to the amendment made by the House of Representatives to the Wheat Marketing Amendment Bill 1985. Senator VIGOR(South Australia) —by leave-I give notice that, on the next day of sitting, I shall move: That leave be given to introduce a Bill for an Act to amend the Broadcasting and Television Act 1942 to clarify the powers of the Australian Broadcasting Tribunal to determine the conditions to be observed by licensees under the Act. Debate resumed. Senator MACKLIN(Queensland)(6.54) —The debate on the Dairy Produce Market Support Levy Bill and related Bills which has just been resumed is on a package of dairy Bills-four all told-which have come to be known in common parlance as the Kerin plan for the dairy industry. I say at the outset that the Minister for Primary Industry (Mr Kerin) is at least a Minister with whom one can debate matters. He is certainly a robust debater, but in such debates and negotiations one knows that one will not be subject to personal abuse and that indeed there is a possibility of discussing the issue, rather than discussing one's individual personal failings or otherwise, as is the case with the Minister who represents the Minister for Primary Industry in this place. We need to note very carefully one important matter in regard to the legislation before us and that is that it has been the result of a very long and difficult process of negotiation. The package, by and large, is accepted by the industry and I shall make some comments about that later in my speech. It has been accepted not without a great deal of heartache and difficulty in bringing together the various dairy industries throughout Australia. The industries in each State have different needs, different outlooks and different structures. The industry is to be commended for seeking to come up with a cohesive and coherent response to the legislation which is before us. It has done that by looking at four amendments. It should be noted that those amendments, unlike some of the comments made by Senator Cooney, do not go to the heart of the plan as it is set out. They go to the way that the plan is to be implemented. One item which changes the plan is the subject of the third amendment by the Opposition and it deals with the milk content. While it changes the plan in terms of the application of money, it is not essential to the plan itself. By choosing either the milk content or the f.o.b. price, one ensures that the plan essentially remains the same. I argue that the industry's position on that is more rational and coherent than the plan currently before us, and as I am given to understand that it is not even the Department's first choice anyway, it is an item that we could dispense with or move to alter as the industry has suggested. This package of Bills will establish a new marketing arrangement for the Australian dairy industry. I would hope that we might be able to debate that without the type of intervention from Senator Walsh, his attempted blackmail and his suggestions that this chamber should not even be engaged in the process of legislation. We were told that to even suggest any amendments was tantamount to overstepping the mark. It is rather interesting to note that when Senator Walsh was in opposition and the Australian Democrats were working with him on various pieces of legislation he was quite happy to take a totally different viewpoint. Indeed, he voted with us to defeat a number of pieces of legislation which became the basis for the double dissolution in 1983. Then it was a different matter. Now that he is in government the whole situation seems to have changed. This is a pity and the types of remarks that he made do not contribute to reasonable debate in the primary industry area and certainly cannot form the basis for a reasonable coming together of minds. I believe that is still possible, provided Senator Walsh is not part of the discussion on these items. I believe that there is still time to come to an accommodation between the industry and this Government so that we can put in place by the end of this week a plan which, while it might not be all things to all people, at least is generally acceptable to both sides. Debate interrupted. The ACTING DEPUTY PRESIDENT(Senator Colston) —Order! It being almost 7 p.m., I put the question: That the Senate do now adjourn. Senator BOSWELL(Queensland)(6.59) —Today I wish to speak about the plight of the haemophiliac and the shortage of blood supplies available for the treatment of his condition. I use the masculine gender as haemophilia is a condition that afflicts only males. The haemophiliac receives his life-saving factor VIII blood products from the Commonwealth Serum Laboratories Commission in Melbourne. Factor VIII is the best and safest treatment available for haemophiliacs. The supplies from CSL are of good quality and the breakthrough with heat-treated factor VIII was welcomed by the haemophiliac community. But the problem is that it is not being produced in sufficient quantity to ensure supplies to all haemophiliacs in all situations. This shortage results in doctors having to compromise their treatment of haemophiliacs because they cannot often give them enough factor VIII, which, in turn, increases the length of recovery time for the patient and also hospital and medical costs. I believe that the production rate at the Commonwealth Serum Laboratories is below the national production rates given by the World Health Authority. I also believe that presently a committee is looking into the CSL's methods of production and its efficiency, and it seems that there is general agreement that there is considered to be scope for improvement in the CSL's operations. My concern is with the haemophiliac who cannot receive sufficient quantities of factor VIII for treatment. I am told that the shortage is more acute in New South Wales than Queensland, but at the moment in Queensland, if a haemophiliac were to be involved in a car accident, for example, and required emergency surgery, all the supplies of factor VIII available in the State at that particular time would be totally used on that one patient. That would throw the whole system into chaos. When a haemophiliac does not have sufficient supplies of the safe heat-treated factor VIII, he must revert to the less safe cryoprecipitate for treatment. The haemophiliac became the unfortunate innocent victim of the acquired immune deficiency syndrome epidemic when he was sent AIDS infected blood products last year. The breakthrough with the safe heat-treated factor VIII was greeted with much delight. One can only feel for the haemophiliac who maybe has been tested positive and the haemophiliac who has escaped this fate so far being forced to inject himself with the not so safe product because not enough supplies of the safe product are being produced. The only safe AIDS-free product is factor VIII. To quote the Red Cross blood transfusion service: There is a great difference in risk between the heat treated production and cryoprecipitate. I ask the Minister for Community Services (Senator Grimes) to imagine how hopeless and rejected haemophiliacs must feel when they cannot get supplies of factor VIII. Firstly, through no fault of their own, they may have to be given a life-saving blood product which may inject AIDS into their systems. They now have to live continually with the knowledge that they have a chance of falling victim to AIDS-a disease which has been described as incurable at the present stage of medical knowledge. Secondly, to compound this problem, they are being forced to inject themselves on many occasions with unsafe blood products. They are denied any choice of blood products. They are denied access to safer products. They are compelled to take the risky product. They feel that the authorities have discarded them. I do not wish to criticise the authorities concerned as they were not to know at the time that the blood they distributed was AIDS contaminated. But surely they do not have to aggravate the plight of positive-tested haemophiliacs by denying them, through shortages in production, the safer blood product for further use. The advent of the AIDS virus in the community has no doubt put a lot of strain on the blood supply services. Donors have been hesitant to donate blood and the need to heat treat the blood destroys 15 per cent of the plasma, meaning that this shortfall has to be made up. However, I am concerned that the haemophiliac is becoming an innocent victim when he is prevented from receiving adequate supplies of life-saving factor VIII because the only source, CSL, is producing inadequate supplies. I would like the Federal Government to involve itself urgently and ensure that CSL lifts its production rate to a suitable level. The shortage may have come about because more donors are needed. The Federal Government could help by, for example, running a public education campaign which specifically allays the fears that are in the community about donating blood. As has often been suggested, more facilities are needed for handling donors at the various State levels. If this is so, Commonwealth assistance could help to provide these facilities. Finally, the Commonwealth Serum Laboratories could lift their production rate to meet the World Health Organisation standards and to meet the need in the community for factor VIII. This may require more equipment or staff, but surely in an industrially advanced country such as Australia, with its high standard of living, a government facility which has vested in it the sole responsibility for the production of an important medical product must be continually monitoring whether it is meeting that need. The supply of factor VIII for the treatment of haemophiliacs is not at a suitable level. I therefore ask the Federal Government to exercise its duty to ensure that the Commonwealth Serum Laboratories remedies the problems preventing it meeting the supply demand, at the earliest possible moment, so that adequate supplies of factor VIII are produced to enable the proper treatment of all haemophiliacs. Senator VANSTONE(South Australia)(7.05) —Last Thursday during the adjournment debate I brought to the attention of the Senate three examples which I thought were very good indications of inaction by government departments and which reflected very poorly upon the concept of open government much promulgated by this Government and the provision of basic information to members of this Parliament. In passing, I recall that on that occasion the Minister for Finance, Senator Walsh, undertook to look at the matters I had raised. I can assume only that the Minister is still looking or alternatively that he has had the misfortune to have sought advice from the departments concerned. Accordingly, he may be, as I am, still waiting for an answer. This evening I again find it necessary to make reference to the Department of Foreign Affairs and its somewhat stunted sense of information distribution. However, before I touch on that matter-later I will also refer to the emerging saga of the International Year of Peace-I address a few remarks to that oft-maligned public authority, Telecom Australia and the Department of Local Government and Administrative Services. In this case, I do not wish to add to the list of those who have had cause to direct many sharp barbs in the direction of Telecom. In this instance Telecom happens to be the innocent victim of the less than efficient performance of the Department of Administrative Services in certain areas. As honourable senators are only too well aware, the Department of Administrative Services has the responsibility of meeting the various needs of Federal parliamentarians. Despite the years-there would be many-of collective experience that the Department of Administrative Services could lay claim to in this area, I venture the opinion that there are significant areas, particularly in the area of parliamentary services, in which that Department demands improvement. On 14 May, some five months after I became a senator, my office in Adelaide, having received numerous complaints from the public that we were difficult to contact by telephone, resolved to take up the matter with Telecom. I should mention at the outset that my Adelaide office has, since the time of my taking up office, been located in the Commonwealth Parliament Offices in the Commonwealth Bank building. The first course of action my office took was to ring directory assistance and put itself in the position of a member of the public wanting to get my telephone number. When my office spoke with Telecom's directory assistance service it was told that Telecom did not have a listing for Senator Vanstone. My office then spoke to a Telecom supervisor and was finally informed that Telecom had received advice from the Department of Administrative Services on 29 April 1985 that the Commonwealth Parliament Offices entry in the directory should be amended to include, amongst other names, my name. That, I am told, was the standard, six-monthly alteration to Telecom listings. I do not think it is unreasonable to criticise the Department of Administrative Services for taking some four months to advise Telecom of a new senator's entry. I should add that I have spoken to the relevant managing officer and I am sure that he will attend to the matter promptly. I know him to be an efficient and sincere public servant. My point is that, given that Telecom is supplying my office with the right information, the public servants below the officer I spoke to are doing a number of things. Firstly, they are causing my office bother and concern. Secondly, they are hindering access by members of the South Australian community to one of their new senators for whom they are paying. Thirdly, they are letting down very badly the officer in charge of that section. Fourthly-perhaps this should have gone first-they are letting down their colleagues because they are adding fuel to the ever-growing anti-Public Service fire. I turn now to the Department of Foreign Affairs. Last week I was critical of the delays in the provision of basic information about Australia's involvement in the International Year of Peace. Having now studied this much prepared reply from the Department, I could be forgiven for suspecting that the Department was, in the very first instance, less than enthusiastic to have a member of parliament gain any information about the International Year of Peace activities as planned by it. In the letter from the Acting Minister for Foreign Affairs (Senator Gareth Evans) the Department makes reference to a structure of national and State co-ordinating committees for the International Year of Peace. I thought it reasonable to ask who constitutes these committees, especially when we consider that some $3m has been allocated to the International Year of Peace program in Australia. Not wishing to experience yet another three months delay in requesting information from that Department, I took a chance and had my office telephone it and ask about the committees. At this stage I should say that on the telephone the relevant officer from the Department was most helpful and I thank him for his co-operation and assistance. It appears that neither national nor State committees have been formalised, but I do understand, if I may use the vernacular, that names are being thrown around for the national committee. I hope that this Government will invite public nominations for the national committee to ensure that a responsible and balanced management of the international year program develops. After all, this Government does a lot of singing and dancing about the need for public consultation. In conclusion, I think membership of this national committee for the International Year of Peace should be drawn from a very wide section of the community and not simply appointed by the Government from the ranks of its own supporters and from fellow travellers. Senator KILGARIFF(Northern Territory)(7.12) —I rise this evening to speak briefly on the matter of the current debate going on within the Australian Labor Party, the coalition, the Government and the Australian community concerning the Australian taxation system. I wish briefly to talk about how a retail sales tax would affect the people of the outback. Listening to discussions these days, it is obvious that people are not considering how such a tax would affect the people in the outback, where freight costs are now extremely high. If we have a retail sales tax the cost of living in the outback will be increased. There has been a good deal of speculation about whether the Federal Government will opt for a broadly based consumption tax in the form of a retail sales tax in its proposed tax reforms. Although there is clearly a lot of disagreement within elements of the Federal Government and the wider community on the desirability of the introduction of such a tax one thing on which there can be no disagreement or doubt is that a retail sales tax would have a relatively heavier impact on people living in remote areas than it would have on people living in the more densely populated parts of Australia. People who live in the outback, including those living in the larger urban communities in the outback, such as Alice Springs and Darwin-I suppose, for that matter, we could include Katherine, Tennant Creek, Nhulunbuy and others-would have to pay proportionately even more than they do now for goods which are more expensive in these areas than they are in the southern States. While I talk of the main towns of the Northern Territory we must remember all of those very isolated Aboriginal settlements, and mining areas-the various places that are extremely remote and have, as I have said, a particularly heavy freight element in their cost of living. The Northern Territory Government has approached me as it is not unnaturally concerned at the prospect of a retail sales tax. It has prepared a briefing note which details the implications of such a tax for the Northern Territory. It shows clearly that Territorians are already paying between 11 and 27 per cent more on average for basic food items than are their southern counterparts. It also shows that people in remote areas could find themselves paying retail sales tax at a rate 50 per cent higher than that paid by a person living in Sydney or Melbourne. Although I am talking about the Northern Territory, this situation applies in the rest of outback Australia. It applies to Western Australia-to the Kimberleys. It applies to the desert areas in northern South Australia, going up towards the border. It applies to the remote parts of western Queensland. In fact, a large number of people live in these areas and will be affected tremendously unless there is recognition of their plight if a retail sales tax comes about. I will seek leave to incorporate in Hansard a briefing note prepared by the Northern Territory Government. I urge all members of the Government, and for that matter all members of parliament and other interested people, to take note of its conclusions and, in particular, its proposal that if a consumption tax is introduced taxation zone allowances be increased to a level commensurate with the incremental consumption tax paid by persons living in the more remote parts of the Commonwealth. I know that most members of the Parliament, and particularly senators, have visited the outback. I ask them to call to mind all of the small settlements which they have visited and the cost of items, particularly food items held in their little canteens and stores, and to note just how expensive they are now compared with those in the towns and cities. One must also consider the increase in fuel prices, of some 4c a litre, that occurred throughout Australia only some two or three weeks ago. The removal of some of the subsidy will also bring about an increased petrol price. This will initially increase freight costs, which will flow on to increase the cost of other articles. It frightens me to think of how some of these aboriginal and white families living in the outback will cope with the tremendous problem of ensuring that their families eat reasonably well. In fact a lot do not eat reasonably well now because already costs are so high. If a retail sales tax is applied without proper consideration, all I can say is that a lot of people in the outback will be severely hurt by it. The Minister for Community Services (Senator Grimes), who is the Minister in charge of the House at the moment, has consented to my incorporating in Hansard the briefing notes titled 'Implications for the N.T. of a Retail Sales Tax (RST)'. As I said before, this applies to people of the outback. I formally seek leave to have the briefing notes incorporated, as well as a spatial price index list which refers to remote communities and which is marked 'Attachment 1'. Leave granted. The documents read as follows- BRIEFING NOTE-IMPLICATIONS FOR THE N.T. OF A RETAIL SALES TAX (RST) In the present debate in Australia on tax reform, the introduction of a consumption tax in the form of a retail sales tax (RST) covering almost all goods and services, has been widely advocated. This tax is seen by its supporters as a means of making possible substantial reductions in personal income tax. Discussion on the equity implications of a RST has focused on its differing relative impact at different income levels. Scant attention has been given to the differing relative impact on persons living in different parts of the Commonwealth. In public finance terminology, the attention has been on vertical equity, but not also on horizontal equity. A RST will have a relatively heavier impact on Territorians than on Australians as a whole because the general level of costs and prices is higher in the Territory than it is at the national level. There is no comprehensive measure available of price differences by location in Australia. However, some indication of general price relativities can be obtained from the ''Experimental Index Numbers of Relative Retail Prices of Food'' produced by the ABS. Taking the weighted average of food prices in the six State capitals as the base (index number=100), the ABS in its most recent compilation (May 1983) calculated the following index numbers for the main Territory centres: Darwin 111 Alice Springs 117 Katherine 117 Tennant Creek 114 Nhulunbuy 127 This means, for example, that food prices in Darwin are 11% higher than the average for the State capital cities. In Territory centres other than those listed above, the price differences are even greater. The N.T. inquiry into freight and related costs produced index numbers showing the extent to which food prices are higher in the more remote communities of the Territory than they are in the main Territory centres. Using Darwin or Alice Springs (as appropriate) as the base (index number=100), the inquiry compiled index numbers for selected communities (refer attachment 1). The inquiry found that the cost of the selected ''basket'' of food items varied from 2% to 50% above the applicable Darwin or Alice Springs price. From this it can be concluded that the average cost of food items in the remote communities of the Territory is roughly between 20% and 70% higher than in the State capital cities. A RST has a compounding effect on the tax burden on persons living in remote areas, where costs and prices are inevitably higher. This can be illustrated in the following hypothetical example: Retail RST 'After Location price ($) (at 10%) tax' retail ($) price ($) Major southern capitals 100 10.0 110.0 Darwin 111 11.1 122.1 Borroloola 148 14.8 162.8 In this example, a person living in Borroloola pays $14.80 in tax for purchasing the $100 item, whereas a person living in, say, Sydney or Melbourne, pays $10.00 for purchasing the same item. Thus, the Borroloola person has an effective tax rate of 14.8%, even though his nominal tax rate is 10%. In other words his RST rate is effectively about 50% higher than for a person living in Sydney or Melbourne. Another way of assessing the higher relative impact of a RST on the Territory is to consider levels of overall consumption expenditure. The '1984 survey of household expenditure, Australia', conducted by the ABS, showed that average weekly expenditure on goods and services by territory households was $446.88-27% higher than the corresponding national figure of $351.40 (it should be noted that this survey did not extend to remote areas, hence the territory figures are probably on the low side). Whatever rate of RST is struck, the amount of RST paid by territory households will be of the order 27% higher, on average, than Australian households generally. For example, if the rate of RST is 12.5% (as has been widely suggested) and the tax covers 90% of consumption expenditure (allowing for some exemptions), on the above figures the average territory household would be paying over $500 more per annum than the average Australian household. The above analysis indicates that an across the board consumption tax in the form of a RST would be inequitable in that it would impose a heavier tax burden on Territorians and other persons living in remote areas of Australia, than on other Australians. It would be impractical to compensate people exactly for the higher effective rates of consumption tax which occur at different localities in Australia. However, a mechanism does exist whereby reasonable redress could be obtained-namely, the taxation zone allowance arrangements. In the event of a RST coming into existence, there is a strong case on equity grounds, for taxation zone allowances to be increased to a level commensurate with the incremental consumption tax paid by persons living in the more remote parts of the Commonwealth. SPATIAL PRICE INDEX-REMOTE COMMUNITIES Basket Community Cost Index $ % Angurugu 641.77 127 Basket Cost-Darwin 506.36 Aputula (Finke) 655.03 134 Basket Cost-Alice Springs 487.40 Areyonga 683.28 146 Basket Cost-Alice Springs 469.21 Borroloola 686.36 133 Basket Cost-Darwin 514.54 Docker River 648.15 141 Basket Cost-Alice Springs 460.66 Gunbalanya (Oenpelli) 570.47 111 Basket Cost-Darwin 513.45 Haasts Bluff 548.32 139 Basket Cost-Alice Springs 395.30 Hermannsburg 509.69 102 Basket Cost-Alice Springs 500.37 Kalkaringi (Wave Hill) 581.81 126 Basket Cost-Darwin 461.28 Lajamanu (Hooker Creek) 631.94 128 Basket Cost-Darwin 494.40 Maningrida 747.54 146 Basket Cost-Darwin 511.71 Milikapiti (Snake Bay) 671.86 135 Basket Cost-Darwin 496.81 Mt. Allan Station 546.44 150 Basket Cost-Alice Springs 364.99 Napperby Station 474.34 125 Basket Cost-Alice Springs 379.81 Nguiu Bathurst Island) 716.42 135 Basket Cost-Darwin 529.58 Numbulwar 589.16 131 Basket Cost-Darwin 449.13 Port Keats 596.67 112 Basket Cost-Darwin 532.58 Pularumpi (Garden Point) 698.87 133 Basket Cost-Darwin 525.48 Santa Teresa 507.57 108 Basket Cost-Alice Springs 471.43 Walanguru (Kintore) 599.02 138 Basket Cost-Alice Springs 435.20 Warrabri 572.10 122 Basket Cost-Alice Springs 468.50 Yuendumu 497.70 131 Basket Cost-Alice Springs 381.06 Senator KILGARIFF —I thank the Senate. Senator GRIMES(Tasmania-Minister for Community Services)(7.18) —I will deal with the matters that were raised tonight one by one, adequately or inadequately, seriatim, and all the other tautologies that we usually use in this place. First of all, Senator Boswell was concerned about the plight of haemophiliacs and the shortage of factor VIII, as he has obviously been informed, available to treat this condition. In his speech he seems to have laid a considerable amount of blame on the Commonwealth Serum Laboratories for its lack of production, for its inefficiency of production and, I think, for its lack of quality of production. Senator Boswell —No, I didn't say quality. Senator GRIMES —I am sorry, I think there is a misconception here and I think I should clear it up. Factor VIII is produced by the Commonwealth Serum Laboratories from plasma supplied to the Laboratories by the Red Cross blood transfusion unit. The amount of factor VIII which can be produced by CSL is limited by the amount and quality of plasma it gets. The issue has been complicated more recently by the problem of the acquired immune deficiency syndrome, as Senator Boswell has said, because the heat treatment of the cryo-precipitate, which is the form of factor VIII that Senator Peter Baume and I used to use, reduces the effectiveness of it by about 15 per cent. I will take up two points that Senator Boswell made during his speech. He said that he believed the production rate at the Commonwealth Serum Laboratories is below the national production rates given by the World Health Organisation and that presently a committee is looking into the methods of production and efficiency of CSL. He said that it seems there is general agreement that there is scope for improvement in its operations. The first thing of which I inform Senator Boswell is that CSL's production yields of factor VIII are considerably higher than world standards and considerably higher than most standards in the northern hemisphere. It was the first laboratory outside the United States to produce in great scale the heat treated precipitate which almost entirely eliminates the possibility of the transmission of AIDS. Any suggestion that in this area of production CSL is less than world standard is quite untrue. Secondly, there is no committee investigating the methods of production and the efficiency of CSL. I think there is general agreement amongst those who have the expertise to understand, and who knows the facts, that CSL performs remarkably well given the quality of the material supplied by the Red Cross. There is a problem with the supply of factor VIII but that problem is predominantly in New South Wales where, for the last six or seven years, the Red Cross blood transfusion service, which has a monopoly on blood collection in this country, has failed for all sorts of reasons-I dare say that the difficulty has increased in recent times-to provide sufficient plasma to the CSL for it to give adequate units of factor VIII to that State. The CSL produces factor VIII and distributes it throughout the country in proportion to the amount of serum it gets from each State. I have no knowledge that Queensland has been unable to produce adequate serum for this purpose. I know that there has been a problem in New South Wales for many years. CSL produces quantities of factor VIII at levels which are determined by the haemophiliac therapy review group in Australia on which CSL has representatives, as have doctors who treat haemophilia. The last time I was able to find out, the only State in which production was inadequate was New South Wales. That was because of its failure to get sufficient of the base product. It is a matter of the Government urging CSL to produce sufficient factor VIII; CSL produces as much factor VIII as it can. We may have to increase the supply of base material, namely, plasma, but that is not the fault of CSL. Its production methods are very efficient. For some reason, in recent months, there has been an attack on CSL over its production of factor VIII. One attack was made in the New South Wales Parliament by a member who is of the same party as mine. He made a long and very detailed speech on the production of factor VIII. CSL replied in great detail and demonstrated that the assertions he made in the New South Wales Parliament were false. In fact, some of those assertions were the sorts of things that Senator Boswell said in the chamber tonight. I am not suggesting that Senator Boswell has made them up but someone with a vested interest may be providing information of this type, which is patently false, to members of parliament around the country in an effort to discredit CSL. Senator Boswell —Mr Acting Deputy President, I take a point of order. I want it recorded in Hansard that I in no way intended- The ACTING DEPUTY PRESIDENT(Senator Colston) —There is no point of order if Senator Boswell merely wants something recorded in Hansard. Senator GRIMES —Senator Boswell may not have intended to attack the efficiency of CSL but that is the gist of his claim that its production rate is lower than world standards and that a committee is looking into the production of factor VIII. There is no such committee. In this day and age, with the possibility of the transmission of AIDS, there is a very real problem for haemophiliacs. Some haemophiliacs have, unfortunately, contracted AIDS from blood transfusions in the past and particularly from the use of the cryo-precipitate which was used before we knew about the problem of AIDS. The cryo-precipitate can be treated and supplies of that are supposed to have gone back to CSL to be heat treated to get rid of the AIDS virus as far as possible. Haemophiliacs should not have to use the cryo-precipitate because no heat treated product is available. I do not know what the situation is in that regard in Queensland. As for assisting people with haemophilia and increasing the collection of serum in these difficult times, as we all know, some people stopped giving blood because they thought, in some strange way, that that could cause a problem with AIDS. The Federal Government, in combination with the State governments, including the Queensland Government, has conducted a considerable campaign to assist through the supply of AIDS testing kits et cetera, not only those who are likely to get AIDS, but also by ensuring that blood, as much as is humanly possible these days, is tested for the possibility of its being contaminated with AIDS. The Government has made grants for education, support and counselling services specifically for haemophilia and it has also supplied the money for the antibody testing of all haemophiliacs in Australia. There are about 1,500 haemophiliacs in Australia. They are spread quite widely through the community. It has not been possible for the Commonwealth to provide a counsellor for each haemophiliac but the Commonwealth has supplied funds. In conjunction with State health authorities it has provided counsellors. The positioning of those counsellors is the responsibility of the State governments. At the same time, the Red Cross has had a considerable advertising campaign to attract more donors, particularly, initially, female donors, so that it can ensure that its blood supplies are sufficient for the treatment of trauma and people having surgery and also for the treatment of haemophilia and the production of factor VIII. As I said earlier, In New South Wales that has been a problem but it has been a continuing problem for a long time. The Government has also sent the President of the Australian Federation of Haemophilia to all States to help in the education campaign and to provide assistance for those with haemophilia. I suggest that if any haemophiliacs are feeling uncertain about what should be done they should contact their Federation and get the counselling that they need. I do not know the truth of the assertion that if one haemophiliac were involved in a car accident his treatment would wipe out the whole of the supply of factor VIII in Queensland. I can remember the days when Senator Baume and I used to treat haemophilia. That probably would have been the case then if we had had to treat victims of very severe accidents. At one stage I had under my care in hospital the two worst haemophiliacs in Australia. They had the lowest level of factor VIII. In exchange for samples of their blood, which the CSL used as a standard, I used to get more factor VIII, fortunately, than I was supposed to get. Those patients had a penchant for being involved in accidents. We would have to use fresh blood, as Senator Baume said. I would be surprised if there was inadequate factor VIII to cope with traumas like that, even in Queensland. I will refer Senator Boswell's speech to the CSL and the Minister for Health (Dr Blewett) to get more detailed answers. Senator Vanstone has experienced problems with the Department of Administrative Services. I have heard similar statements over the last 11 years. We have all been trying to do something about it, but have not succeeded. I will refer her concerns about the national committee on the International Year of Peace to Mr Hayden. I merely make the wry remark-if that is what it can be called-that it always interests me that people on the opposite side of the chamber, when they are in opposition, get up and thump the table and insist that the Government should appoint committees which are broad-based, not only with government supporters or Labor supporters; but when in government themselves they appoint committees which are hardly broad-based and composed of other than government supporters, except in a few token cases. One of those token cases is interesting. I remember that Sir Jack Egerton was kept on the Reserve Bank by the Liberal Government on the grounds that he was a Labor supporter. Senator Kilgariff expressed concern about the effects of a broad-based consumption tax on people in the outback. I can assure Senator Kilgariff that before any such tax is introduced, all those factors he presented, and many others, will be taken into consideration, as I am sure they have been by those vigorous supporters of broad-based consumption tax in his own party. I am sure that such a change will not be made in this community without wide consultation, not only with members of parliament but with members of the community. Senator BOSWELL(Queensland) —by leave-I wish to make a personal explanation. I thank Senator Grimes for his very detailed and complete answers to the questions posed in my speech. I wish to have it recorded in Hansard that I in no way implied criticism of Commonwealth Serum Laboratories in my speech. If the Minister interpreted it that way, I apologise to CSL. Question resolved in the affirmative. Senate adjourned at 7.32 p.m. The following paper was tabled: Commonwealth Teaching Service Act-Determinations 1985-No. 2.